<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 7, 1998
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
FLOUR CITY INTERNATIONAL, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
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NEVADA 1799 62-1709152
(STATE OR OTHER JURISDICTION (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
OF CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
INCORPORATION OR
ORGANIZATION)
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MICHAEL J. RUSSO
PRESIDENT AND CHIEF EXECUTIVE OFFICER
FLOUR CITY INTERNATIONAL, INC.
915 RIVERVIEW DRIVE, SUITE ONE
JOHNSON CITY, TENNESSEE 37601
(423) 928-2724
(NAME AND ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES AND AGENT FOR SERVICE)
WITH COPIES TO:
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WILLIAM J. LOPSHIRE, ESQ. GARY J. KOCHER, ESQ.
MANNING MARDER & WOLFE PRESTON GATES & ELLIS LLP
707 WILSHIRE BOULEVARD, 45TH FLOOR 701 FIFTH AVENUE, SUITE 5000
LOS ANGELES, CALIFORNIA 90017 SEATTLE, WASHINGTON 98104-7078
(213) 624-6900 (206) 623-7580
</TABLE>
Approximate Date of Commencement of Proposed Sale to the Public: as soon as
practicable after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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PROPOSED MAXIMUM
PROPOSED MAXIMUM AGGREGATE
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED(1) PER SHARE(2) PRICE(1)(2) REGISTRATION FEE
- --------------------------------------------------------------------------------------------------
Common Stock ($.0001 par
value)..................... 2,300,000 shares $12.00 $27,600,000 $9,356.00
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(1) Includes 300,000 shares of Common Stock which may be purchased by the
Underwriters to cover over-allotments, if any.
(2) Estimated solely for the purpose of determining the registration fee.
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
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<PAGE> 2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED JANUARY 7, 1998
2,000,000 SHARES
LOGO
FLOUR CITY INTERNATIONAL, INC.
COMMON STOCK
All 2,000,000 shares of Common Stock offered hereby (the "Offering") are
being issued and sold by Flour City International, Inc. It is currently
estimated that the initial public offering price per share will be between
$10.00 and $12.00. See "Underwriting" for a discussion of the factors considered
in determining the initial public offering price. The Company intends to apply
to have the Common Stock listed on the Nasdaq National Market upon commencement
of the Offering under the symbol "FCIN."
THE COMMON STOCK OFFERED HEREBY INVOLVES A HIGH DEGREE OF RISK. SEE
"RISK FACTORS" COMMENCING ON PAGE 6 OF THIS PROSPECTUS.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
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PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC DISCOUNTS(1) COMPANY(2)
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Per Share................................. $ $ $
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Total (3)................................. $ $ $
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(1) Excludes a non-accountable expense allowance payable to the Representative
of the Underwriters and the value of a warrant to be issued to the
Representative to purchase up to 230,000 shares of Common Stock. The Company
has agreed to indemnify the Underwriters against certain liabilities,
including liabilities under the Securities Act of 1933, as amended. See
"Underwriting."
(2) Before deducting expenses of the Offering payable by the Company, estimated
at $780,000.
(3) The Company has granted the Underwriters a 45-day option to purchase up to
300,000 additional shares of Common Stock solely to cover over-allotments,
if any (the "Over-Allotment Option"). If the Over-Allotment Option is
exercised in full, the total Price to Public, Underwriting Discounts and
Proceeds to Company will be $ , $ and $ ,
respectively. See "Underwriting."
The shares of Common Stock are offered by the several Underwriters, subject
to prior sale, when, as and if delivered to and accepted by them and subject to
the right of the Underwriters to reject any order in whole or in part. It is
expected that delivery of the certificates representing such shares will be made
against payment therefor at the offices of Van Kasper & Company, in San
Francisco, California, on or about March , 1998.
VAN KASPER & COMPANY
MARCH , 1998
<PAGE> 3
IN CONNECTION WITH THIS OFFERING, CERTAIN UNDERWRITERS MAY ENGAGE IN
PASSIVE MARKET MAKING TRANSACTIONS IN THE COMMON STOCK ON THE NASDAQ NATIONAL
MARKET IN ACCORDANCE WITH RULE 103 OF REGULATION M UNDER THE SECURITIES EXCHANGE
ACT OF 1934, AS AMENDED. SEE "UNDERWRITING."
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK.
SUCH TRANSACTIONS MAY INCLUDE OVER-ALLOTMENT AND STABILIZING TRANSACTIONS AND
THE PURCHASE OF COMMON STOCK TO COVER SHORT POSITIONS. FOR A DESCRIPTION OF
THESE ACTIVITIES, SEE "UNDERWRITING."
2
<PAGE> 4
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by the more detailed
information and the consolidated financial statements and notes thereto
appearing elsewhere in this Prospectus. See "Underwriting."
THE COMPANY
Flour City International, Inc. ("Flour City" or the "Company") is a
worldwide leader in the design, fabrication and installation of custom exterior
wall systems (known as "curtain wall") used in the construction of a wide range
of commercial and governmental buildings. The Company works closely with
architects, general contractors and owners/developers in the development and
construction of highly recognizable mid-rise and high-rise office buildings,
public-use buildings such as courthouses and airport terminals, and other
well-known landmark buildings and uniquely designed structures.
Founded in 1893, the Company is known within the construction industry as a
high quality provider of custom curtain wall systems. As one of the few
remaining full-service custom curtain wall providers following an industry
downsizing during the early 1990's, Flour City is invited to submit proposals on
a significant portion of the building projects which require custom curtain
wall. The Company selectively bids on only those projects which best utilize its
management, design and production capabilities, which, in turn, has enabled the
Company to generate strong financial performance. For the year ended October 31,
1997, Flour City had pro forma revenues of $35.2 million, a 41.1% increase over
1996 pro forma revenues, a pro forma gross margin of 41.2% and pro forma net
income of $5.4 million.
The Company is poised to capitalize on the emerging growth trends in the
U.S. office building and governmental construction markets. As the United States
economy has grown vacancy rates have declined sharply from 19.0% in 1990 to
11.6% in the first quarter of 1997. In certain metropolitan areas vacancy rates
have dropped below 5% and nationwide office lease rates are increasing and many
new mid-rise and high-rise office building construction projects are in the
development pipeline. In addition, many public authorities have increased
spending on public-use structures as a result of the aging of many facilities
and the growth in tax receipts generated by an improving domestic economy. The
Company will use a portion of the proceeds of the Offering to increase its
project bonding capabilities, which will allow the Company to undertake more and
larger projects.
The Company participates in projects worldwide and has multiple sales
offices and fabrication facilities strategically located in the United States,
Asia and Mexico. Flour City has several strategic relationships with major
international architects, developers and general contractors which promote the
Company's participation in desirable projects. These relationships include
alliances with Bechtel International, Inc. ("Bechtel"), Turner Construction
Company ("Turner Construction"), Morse Diesel International ("Morse Diesel"),
New World Development Company Ltd. ("New World Development"), Pei Cobb Freed and
Partners ("Pei Cobb"), Skidmore Owings & Merrill and Kohn Pederson & Fox. The
Company has bids outstanding in the United States, Hong Kong, the People's
Republic of China (the "PRC"), the Philippines, Indonesia and Latin America.
The Company intends to build on its reputation as a world-wide leader in
the custom curtain wall industry to support continued growth and increased
profitability. The key elements of the Company's strategy to accomplish these
goals are to: (i) selectively target high margin projects; (ii) maintain and
develop key strategic relationships; (iii) exploit its full service, custom
capabilities; (iv) enhance and exploit its position as a low cost manufacturer;
and (v) capitalize on its global presence.
The Company's management and design staff is comprised of some of the most
experienced and knowledgeable personnel in the business. Flour City's current
management team assumed control of the Company's United States operations in
mid-1994, when operations were experiencing losses as a result of the decline in
construction activity which occurred during the early 1990's. Management
refocused the business and instituted cost containment measures and key elements
of its business strategy which returned the operations to profitability in late
fiscal 1996.
3
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Well-known projects for which Flour City has designed, manufactured and
installed custom curtain wall systems include the Citicorp Center and JFK
Airport Terminal One in New York City, the Rock and Roll Hall of Fame in
Cleveland, the First Interstate Tower in Los Angeles, the Allied Bank Tower
(Fountain Place) in Dallas, the United Airlines Terminal and the International
Terminal at O'Hare Airport in Chicago, the G.T. International Tower in Manila,
the Empire Towers in Bangkok and the IDS Building in Minneapolis.
RECENT DEVELOPMENTS
As of November 30, 1997, the Company had over $53.1 million in project
backlog. At December 31, 1997, the Company had submitted bids on projects with
an aggregate contract value of over $135 million. There can be no assurance that
the Company will be successful in securing any contracts as a result of these
bids or that the Company will recognize as revenue the amounts reflected as
backlog.
THE OFFERING
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Common Stock offered............................. 2,000,000 shares
Common Stock outstanding after the Offering...... 6,252,381 shares(1)
Use of proceeds.................................. For the acquisition of and capital
expenditures at curtain wall fabrication
facilities in the PRC, Mexico and the
U.S.; to increase the Company's bonding
facilities; and for working capital and
other general corporate purposes. See "Use
of Proceeds."
Proposed Nasdaq National Market Symbol........... FCIN
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(1) Excludes 500,000 shares of Common Stock reserved for issuance pursuant to
the Company's 1997 Stock Incentive Plan, of which options to purchase
200,000 shares will be granted to employees and directors of the Company
upon the closing of the Offering at an exercise price per share equal to
the initial public offering price. See "Management -- Stock Incentive
Plan."
Other than in the historical financial statements unless otherwise noted,
all share amounts, per share data and other information set forth in this
Prospectus (i) have been adjusted to reflect a 1 for 7 reverse stock split which
will be effected prior to the consummation of the Offering and (ii) assumes no
exercise of the Underwriter's Over-Allotment Option. Unless otherwise indicated
by the context, references herein to the "Company" and "Flour City" include the
consolidated operations of Flour City International, Inc. and its predecessors
and subsidiaries. Historical financial information of the Company herein
presents combined results of operations and financial position of the following
entities on and after the dates indicated: Flour City Architectural Metals
(Pacific) Limited, a British Virgin Islands corporation ("FCAM Pacific"), from
May 4, 1993; Flour City Architectural Metals, Inc., a Delaware corporation
("FCAM"), from January 1, 1997; Flour City International, Inc., a Nevada
corporation ("FCI"), from January 17, 1997; and International Forest Industries,
Inc., a Nevada corporation ("IFI"), from May 16, 1997. See "The Company,"
"Selected Financial Data," "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and Note 1 of Notes to Consolidated
Financial Statements and the Unaudited Pro Forma Financial Information and the
Notes thereto included elsewhere in the Prospectus. This Prospectus contains
forward-looking statements that involve risks and uncertainties, such as
statements of the Company's strategies, plans, objectives, expectations and
intentions. The Company's actual results could differ materially from those
anticipated in these forward-looking statements as a result of any number of
factors, including the risk factors set forth below and elsewhere in this
Prospectus. The cautionary statements made in this Prospectus should be read as
being applicable to all related forward-looking statements wherever they appear
in this Prospectus.
4
<PAGE> 6
SUMMARY FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)
The following financial data present historical information for the Company
as of the periods ended October 31, 1996 and 1997 and pro forma data reflecting
consummation of the acquisitions by the Company of FCAM and FCAM Pacific (the
"Business Combination") and the merger of FCI with IFI (the "Public Merger") as
if such transactions had occurred November 1, 1996. See the "Company," "Selected
Financial Data," "Management's Discussion and Analysis of Financial Condition
and Results of Operations," Notes 1 and 13 of Notes to Consolidated Financial
Statements and the Unaudited Pro Forma Financial Information and notes thereto
included elsewhere in this Prospectus.
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<CAPTION>
ACTUAL PRO FORMA
------------------------- ----------
YEAR ENDED YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31, OCTOBER 31,
1996 1997 1997
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CONSOLIDATED STATEMENT OF INCOME DATA:
Revenues............................................... $ 6,684 $ 31,875 $ 35,229
Gross profit........................................... 3,019 13,845 14,495
Selling, general and administrative expenses........... 1,353 6,117 6,646
Operating income....................................... 1,666 7,931 8,103
Other income (expense), net............................ 40 (958) (942)
Income before minority interest and income taxes....... 1,706 6,973 7,161
Net income............................................. $ 1,548 $ 5,226 $ 5,414
======== ======== ========
Net income per share(1)................................ $ .43 $ 1.28 $ 1.26
======== ======== ========
Weighted average shares outstanding(1)................. 3,597 4,097 4,293
OTHER DATA:
Backlog(2)............................................. $ 15,957 $ 53,267 $ 53,267
</TABLE>
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<CAPTION>
OCTOBER 31, 1997
-----------------------
AS
ACTUAL ADJUSTED(3)
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CONSOLIDATED BALANCE SHEET DATA:
Working capital.................................................. $ 8,511 $28,081
Total assets..................................................... 22,569 42,139
Total long-term debt............................................. -- --
Stockholders' equity............................................. 9,159 28,729
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(1) Excludes 200,000 shares of Common Stock subject to options to be granted to
employees and directors of the Company upon the closing of the Offering at
an exercise price per share equal to the initial public offering price. See
"Management --Stock Incentive Plan."
(2) Represents revenue anticipated to be recognized in the future on awarded
projects, as evidenced by an executed letter of intent or contract, but on
which (i) work has not yet been initiated or (ii) work is currently in
progress. There can be no assurance that the Company will recognize as
revenue the amounts reflected as backlog. See "Business -- Backlog."
(3) Adjusted for the sale of 2,000,000 shares of Common Stock offered hereby and
the application of the estimated net proceeds therefrom. See "Use of
Proceeds."
5
<PAGE> 7
RISK FACTORS
An investment in the shares of Common Stock offered by this Prospectus is
speculative and involves a high degree of risk. In addition to the other
information contained in this Prospectus, the following risk factors should be
considered carefully in evaluating an investment in the Common Stock. This
Prospectus contains forward-looking statements that involve risks and
uncertainties, such as statements of the Company's strategies, plans,
objectives, expectations and intentions. The Company's actual results could
differ materially from those anticipated in these forward-looking statements as
a result of any number of factors, including the risk factors set forth below
and elsewhere in this Prospectus. The cautionary statements made in this
Prospectus should be read as being applicable to all related forward-looking
statements wherever they appear in this Prospectus.
RISKS RELATING TO THE BUSINESS OF THE COMPANY
Absence of Combined Operating History. In January 1997, FCI acquired FCAM
and FCAM Pacific. Prior to January 1997, FCAM on the one hand, and FCAM Pacific,
on the other, operated as independent entities. There can be no assurance that
the Company will successfully integrate their operations or institute the
necessary controls, systems, and procedures, including accounting and financial
reporting systems, to manage on a profitable basis, any of the operations
individually or collectively, the Asian Companies' (as defined below) operations
collectively, or the entire combined enterprise. While each of the Company's
officers and directors has substantial business experience, they have no
experience in managing all of the different business operations in which the
Company is now engaged. Accordingly, there can be no assurance that the
Company's management group will be able to effectively manage the combined
entity or to effectively implement the Company's internal growth strategy. The
pro forma financial data contained herein cover, in part, periods when the
Company, FCAM and FCAM Pacific were not under common control or management and
may not be indicative of the Company's future financial or operating results.
The inability of the Company to integrate FCAM and FCAM Pacific successfully
could have a material adverse effect on the Company's business, results of
operations and financial condition. See "The Company," "Business -- Strategy,"
"Management" and "Certain Transactions."
Real Estate Development and Construction Industries. The Company's business
is affected by the risks generally inherent to the real estate development and
construction industries, including, without limitation, general market, economic
and political conditions, availability of financing, interest rates, government
regulation, land use, inflation, employment levels, environmental regulations
and fiscal policies and the level of tax collection and disbursement. The real
estate development industry is subject to fluctuations in office and commercial
lease rates, vacancy rates, real estate values and building prices. In addition,
there is a limited amount of land available for commercial mid-rise, high-rise
or campus style development in certain key markets. The foregoing factors (and
thus the commercial development business) have tended to be highly cyclical in
nature. Any economic downturn in the real estate development or construction
industries in markets where the Company is engaged, particularly in the U.S.,
Asia or Latin America or substantial changes in any of the foregoing factors may
have a material adverse effect on the Company's business, results of operations
and financial condition. See "Business -- Industry Background."
Fixed Price Contracts. A substantial portion of the Company's projects are
currently performed on a fixed-price basis. The Company attempts to cover
increased costs of anticipated changes in labor, material and service costs of
long-term contracts either through an estimation of such changes, which is
reflected in the original bid price, or through price adjustment clauses.
Despite these attempts, however, the revenue, expense and gross profit realized
from performance of a fixed-price contract will often vary from the estimated
amounts because of unforeseen conditions or changes in job conditions and
variations in labor and equipment rates and productivity over the term of the
contract. These variations and the risks generally inherent in custom curtain
wall manufacturing and installation may result in gross profits realized by the
Company being different from those originally estimated and may result in the
Company experiencing reduced profitability or losses on projects. Depending on
the size of a project, these variations from estimated contract performance
could have a significant effect on the Company's operating results for any
reporting period. See "Management's Discussion and Analysis of Financial
Condition and Results of Operations."
6
<PAGE> 8
Percentage-of-Completion Accounting. The Company recognizes contract
revenues using the percentage-of-completion method. Under this method, estimated
contract revenues generally are accrued based on the percentage that costs to
date bear to total estimated costs. Estimated and actual contract losses are
recognized in full when determined. Accordingly, contract revenues and total
cost estimates are reviewed and revised periodically as work progresses and as
change orders are approved, and adjustments based upon the percentage of
completion are reflected in contract revenues in the period when such estimates
are revised. To the extent that these adjustments result in a reduction or an
elimination of previously reported contract revenues, the Company would
recognize a charge against current earnings, which could be material to the
Company's results of operations. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations."
Concentration of Revenues. The Company has in the past derived, and expects
to continue to derive, a substantial portion of its revenues in any reporting
period from a relatively small number of major projects. On a pro forma basis,
the Company's five largest engagements accounted for 33.4%, 30.5%, 10.7%, 5.4%
and 3.5% of total revenues in fiscal 1997 and 20.2%, 18.9%, 11.7%, 11.6% and
6.1% of total revenues in fiscal 1996. The termination of one or more of the
Company's key projects could have a material adverse effect on the Company's
business, results of operations and financial condition. See "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Overview" and "Business -- Projects."
Delays in Completion of Construction Projects. Pursuant to the terms of its
custom curtain wall manufacturing and installation agreements, the Company is
required to complete substantially all of its projects by predetermined dates
(subject to limited exceptions). Project contracts often provide that if a
project does not proceed in accordance with a specified schedule due to the
Company's performance, the Company may be required to make penalty payments
according to the extent and timing of the delay or the contract may be
terminated. The Company is also subject to various delay risks, including delays
by general contractors or other subcontractors in obtaining, or their inability
to obtain, zoning and other approvals, unavailability of materials and labor,
possible difficulties with labor unions, ability of general contractors or other
subcontractors to complete work competently and on schedule, surface and
subsurface condition of the land underlying construction sites and other
ordinary risks of construction or force majeure occurrences that may hinder or
delay the successful completion of a particular project. The failure to complete
a particular project on schedule may delay, reduce or eliminate the Company's
projected gross profit or cause losses on a particular project.
Fluctuations in Quarterly Results. The Company has experienced, and in the
future expects to continue to experience, substantial variations in its
quarterly results of operations as a result of a number of factors, many of
which are outside the Company's control. The Company's operating results may
vary because of downturns in one or more segments of the construction industry,
changes in economic conditions, the Company's failure to obtain, or delays in
awards of, major projects, the cancellation of or delays in the progress of
major projects for any reason, including the loss of project financing, the
Company's failure to timely replace projects that have been completed or are
nearing completion, or declines in the amount of the Company's billings in
excess of costs and recognized earnings on uncompleted projects. Any of these
factors could cause the Company's results of operations to fluctuate
significantly from period to period, including on a quarterly basis. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."
Dependence Upon Senior Management and Other Key Personnel. The success of
the Company depends in large part upon the continued efforts, ability and
experience of the Company's management team and other key personnel such as
project managers. The Company has entered into employment agreements with
Messrs. Russo, Tang, Willis and Ulbricht. The loss of any of their services
could have a materially adverse effect on the Company's business, results of
operations and financial condition. See "Management." The success of the Company
is also dependent upon its ability to locate and hire qualified project managers
who are willing and able to relocate to a particular project site. Any delay or
difficulty in the Company's hiring of qualified project managers could impair
the Company's ability to perform its obligations under existing project
contracts and its ability to secure or undertake new projects. See
"Business -- Operations - Project Management."
7
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Dependence Upon Subcontractors and General Contractors. At many of its job
sites, the Company relies upon third party subcontractors for its installation
activities through the use of fixed-price agreements. The Company does not have
any long-term arrangements with subcontractors and there can be no assurance
that the Company will be successful in entering into subcontracting arrangements
in the future on terms acceptable to the Company or at all. The Company also
relies upon each general contractor, and its selected subcontractors, to ensure
timely construction build-out and quality control. The Company's reliance upon
general contractors and subcontractors subjects the Company to a number of other
risks, such as performance delays, inadequacy of installation or construction
undertaken by third parties, financial difficulties of general contractors or
subcontractors, and increased costs if delays or inadequacies occur or
subcontractors need to be replaced. As a result, the Company's business, results
of operations and financial condition is significantly dependent on the
performance of third parties. See "Business -- Operations - Project Execution."
Dependence on Suppliers and Raw Materials. The custom curtain wall business
may, from time to time, experience fluctuating prices and supplies with respect
to raw materials. Aluminum, glass and stone are the principal raw materials
utilized in the construction of the Company's custom curtain walls. In the past,
there have been shortages, and consequently, significant price fluctuations, of
some or all of these supplies in certain markets where the Company manufactures
its products. There can be no assurance that material delays will not occur due
to lack of raw materials or suppliers in the future. The Company's supplier
relationships are typically non-exclusive, and generally terminable by either
party on short notice. The loss or deterioration of the Company's relationship
with a major supplier, an increase in demand by third parties for a particular
supplier's products or materials or delays in obtaining materials could have a
material adverse effect on the Company's business, results of operations and
financial condition. See "Business -- Operations - Project Execution."
Competition. The custom curtain wall industry is highly competitive. There
are a limited number of monumental custom curtain wall projects that are
available for bidding by the Company at any given time. Custom curtain wall
manufacturers compete not only for desirable projects, but also in many
instances for subcontractors, raw materials and labor. A majority of the
Company's projects are obtained through a blind bidding process which is
generally subject to intense competition. Some of the Company's competitors have
greater financial, marketing and sales resources than the Company. There can be
no assurance that the Company will be successful in winning projects for which
it submits bids or that its growth strategy will be successful. See
"Business -- Competition."
Labor Shortages. The Company has been affected by cyclical trends and other
shortages in labor supply in the U.S. and abroad. There can be no assurance that
the Company will continue to have access to sufficient labor supplies to support
its existing or planned operations. In addition, for approximately two weeks
each year there are labor shortages in the PRC and Hong Kong as a result of the
Chinese New Year during which time the Company follows the customary practice of
temporarily discontinuing operations in these regions. In Mexico, manufacturing
operations generally cease from December 15 until January 3, at a minimum. Any
failure to secure adequate labor supplies could have a material adverse effect
on the Company's business, results of operation and financial condition. See
"Business -- Operations - Project Execution."
Need for Additional Financing; Bonding. The custom curtain wall business is
capital intensive and requires substantial up-front expenditures for materials
and production costs. There can be no assurance that the Company will not need
additional financing, particularly to pursue new projects. The Company may be
required to seek additional funds, directly or through subsidiaries, in the form
of equity or debt financing from a variety of sources, including bank financing.
The availability and terms upon which such financing may be obtained are
material to the Company's operations, and there can be no assurance that such
financing, if available, will be on terms acceptable to the Company. The amount
and sufficiency of the Company's capital is the primary component in the
Company's ability to obtain bonding which is often a prerequisite to securing
and performing custom curtain wall construction contracts. If the Company were
unable to secure sufficient additional financing or bonding facilities, it may
not be able to undertake additional or larger custom curtain wall projects,
which could have a material adverse effect on the Company's ability to pursue
its growth strategy. See "Business -- Strategy."
8
<PAGE> 10
Management of Growth and Expansion. The Company's growth and expansion will
depend on a number of factors not entirely within the Company's control
including, among others, the risk factors described herein. There can be no
assurance that the Company will be able to effectively manage its expanding
operations (including the much larger number and scale of certain pending or
future projects) or that such growth will materialize or continue, especially in
the recently volatile economies in Asia and Latin America. Failure to
effectively manage the growth of its business could have a material adverse
effect on the Company's results of operations and financial condition.
Interest Rate Fluctuations. The availability and cost of financing has a
direct effect on the construction industry, including the custom curtain wall
segment. Fluctuations in interest rates, therefore, may have a negative impact
on the number of construction projects, particularly those requiring custom
curtain wall. In addition, fluctuations in interest rates may materially
adversely affect the terms of any debt financing available from banks or other
lenders. Higher interest rates could significantly increase the Company's debt
service, if any, and have a material adverse effect on the Company's business,
results of operations and financial condition. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations."
Potential Liability and Insurance. Substantially all of the Company's
contracts with its customers provide that the Company is responsible for
supervising the installation of its projects at each construction site. As a
result, the Company may be liable for property damage or personal injury which
is directly or indirectly attributable to the actions or omissions of the
Company or its designated subcontractors. The occurrence of such an event could
have a material adverse effect on the Company's business, financial condition
and results of operations. The Company is generally required to maintain
insurance, including insurance for property damage, personal injury and
employer's liability, under its contracts. Although the Company believes that it
currently maintains adequate third party liability and employer's liability
insurance for each of its projects, successful claims against the Company could
exceed the limits of the Company's insurance and could have a material adverse
effect on the Company's business, financial condition and operating results. In
addition, there can be no assurance that the Company will be able to obtain
insurance for itself or its subcontractors on commercially reasonable terms in
the future. See "Business -- Operations - Project Execution" and
"Business - Legal Proceedings."
Government Regulations. Many aspects of the Company's operations are
subject to government regulations in the countries in which the Company
operates, including those relating to currency conversion and repatriation,
trade restrictions, taxation of its earnings and earnings of its personnel,
national or regional environmental policies, work-place safety and the Company's
use of local employees and suppliers. In addition, the Company depends on the
demand for its services from the commercial construction industry and,
therefore, is affected by changing taxes, price controls and laws and
regulations relating to the commercial construction industry generally. The
Company cannot determine to what extent future operations and earnings of the
Company may be affected by new legislation, new regulations or changes in, or
new interpretations of, existing regulations. See "Business."
Litigation. The Company is involved in certain pending environmental and
other litigation. With respect to some of these claims, the Company has a
contractual right of indemnification from Armco, the former parent corporation
of FCAM. No liability has been recorded on the Company's financial statements
with respect to the claims covered thereby. There can be no assurance, however,
that in the event the Company is found liable under these claims that the
indemnities will be sufficient to cover the Company's liability. See "The
Company" and "Business -- Legal Proceedings."
Environmental Matters. The Company's operations are generally subject to
federal, state and local laws and regulations in the countries where it has
established manufacturing facilities which relate to storage, handling,
generation, treatment, emissions, release, discharge and disposal of certain
materials, substances and wastes. U.S. federal and state environmental statutes
impose responsibility on the Company for the clean-up of hazardous materials
that have been generated, stored or disposed of by prior owners or operators of
the Company's facilities. In addition, modifications of existing laws and
regulations or the future adoption of new laws and regulations relating to
environmental matters could require expenditures that may have a material
adverse effect on the Company's financial condition or results of operations.
9
<PAGE> 11
Union Relations. The Company engages workers on a subcontract basis
throughout the U.S. to perform installation services, the majority of whom are
members of the Architectural & Ornamental Ironworkers Union, the International
Union of Operating Engineers and the Glaziers Union (the "Unions"). Although the
Company has historically maintained good relations with the Unions, no assurance
can be given that the Company's satisfactory labor relations will continue or
that its relations will continue without picketing, walk-outs, sit downs,
slow-downs, strikes or the threat of such actions by the Unions. Any such action
could have a materially adverse effect on the Company's business, results of
operations and financial condition.
Adverse Weather and Other Natural Conditions. The Company's timely
performance of its project obligations, including installation, depend in
significant part upon favorable weather conditions. Adverse weather conditions,
including rain, flooding, earthquakes, tornadoes or other natural conditions,
may cause project delays or failures which could materially adversely affect the
Company's operations by reducing productivity in the field installation phase of
a project which could result in a material adverse effect on the Company's
business, results of operations and financial condition.
Adverse Publicity From Failure or Delay. Because many of the Company's
engagements are high-profile, marquee projects, a failure or inability to meet a
project's requirements or a client's expectations with respect to a major
project could damage the Company's reputation and affect its ability to attract
new business. Such a failure could also result in significant financial exposure
to the Company. The inability of the Company to meet a project's requirements,
satisfy client expectations or attract new business could have a materially
adverse effect on the Company's business, results of operations and financial
condition. See "Business -- Operations - Project Execution."
RISKS RELATED TO THE COMPANY'S INTERNATIONAL OPERATIONS
In addition to the risks described above, the Company is subject to the
following risks of doing business in locations outside the U.S.:
Recent Volatility in Asian Economies and Financial and Currencies
Markets. The recent volatility in the Southeast Asian economies and financial
and currencies markets may have a material adverse effect on the Company's
operations and expansion plans in the region. For example, recent interest rate
volatility in Hong Kong and other regional financial markets could negatively
impact Asian real estate property developers who depend upon Asian financial
institutions to finance new construction. In the event of a prolonged economic
crisis, the real estate development and construction industries in which the
Company operates could be disproportionately affected. Continued volatility in
the Southeast Asian economies and financial and currencies markets could have a
material adverse effect on the Company's business, results of operation and
financial condition. See "Business -- Industry Background."
Foreign Exchange Risks. On a pro forma basis, approximately 36% of the
Company's revenues in fiscal 1997 were derived from projects outside the U.S.
Consequently, changes in the value of foreign currencies could adversely affect
the Company's financial condition and results of operations. For example, in
July 1997 the Thai Baht was devalued and allowed to float against the U.S.
dollar and other currencies. As a result, the Company recognized an exchange
loss of $1.3 million in connection with an ongoing project in Thailand. The
Company generally attempts to mitigate foreign exchange risk by entering into
contracts providing for payment in U.S. dollars instead of the local currency
where possible, except for local currency necessary to pay locally-sourced
labor, raw materials or other costs of operations. There can be no assurance
that the Company will be successful in securing payments in U.S. dollars, or
that fluctuations in foreign currencies and other risks will not have a material
effect on the Company's financial condition or results of operations for any
fiscal period. See "Selected Financial Data," "Management's Discussion and
Analysis of Financial Condition and Results of Operations," and
"Business -- Industry Background" and Note 2 of Notes to Consolidated Financial
Statements.
Political Uncertainties. One of the Company's key manufacturing facilities
is located in the PRC, and the Company intends to increase its manufacturing
base elsewhere in Asia. As a result, the Company's operations and assets are
subject to material political, economic, legal and other uncertainties. Changes
in policies by the PRC or other governments resulting in changes in laws,
regulations, or the interpretation
10
<PAGE> 12
thereof, high rates of inflation, taxation, restrictions on imports and sources
of supply, currency devaluations or the expropriation of private enterprise
could materially adversely affect the Company. Economic development in such
countries may be limited as well by the imposition of measures intended to
control economic conditions, the inadequate development of an infrastructure and
the potential unavailability of adequate transportation, adequate power and
water supplies, satisfactory roads and communications and raw materials and
parts. If for any reason the Company were required to move its Asian
manufacturing operation outside of the PRC, where it enjoys beneficial labor
wage rates, the Company's gross margin and results of operations could be
adversely effected.
Uncertain Legal System and Application of Laws. The legal system of the PRC
and many other Asian nations relating to foreign investments is both new and
continually evolving, and there can be no certainty as to the application of its
laws and regulations in particular instances. The PRC does not have a
comprehensive system of national laws. Enforcement of existing laws or
agreements may be sporadic and implementation and interpretation of laws
inconsistent. Even where adequate law exists, it may not be possible to obtain
swift and equitable enforcement of that law.
The PRC's Recent Turbulent Relations with the U.S. The U.S. in recent years
has considered revocation of the PRC's most favored nation ("MFN") trade status,
which provides the PRC with the trading privileges available generally to
trading partners of the U.S. The U.S. and the PRC have recently been involved in
controversies over the protection in the PRC of foreign intellectual property
rights which threatened to interrupt trade between the countries in 1997.
President Clinton extended the PRC's most favored nation status, and the U.S.
and the PRC reached an agreement that averted a possible trade war and a U.S.
embargo against the importation of certain products manufactured in the PRC.
There can be no assurance that future controversies will not arise that again
threaten the status quo involving trade between the U.S. and the PRC, or that
the U.S. will not revoke or refuse to extend the PRC's MFN status. Any such
action could have a material adverse effect on the Company's business, financial
condition and results of operations.
RISKS RELATING TO THE COMMON STOCK.
Control by Existing Stockholders. Upon completion of this Offering, the
Company's executive officers, directors and significant existing stockholders
will beneficially own approximately 59.6% of the outstanding Common Stock. These
persons, if acting in concert, will be able to determine the outcome of any
matter submitted to a vote of the stockholders, including the election of
directors. See "Principal Stockholders."
Dilution; Dividends. Purchasers of the shares offered hereby will suffer
immediate and substantial dilution of $6.60 per share from the initial public
offering price, assuming an initial public offering price of $11.00 (which
represents the midpoint of the range stated on the cover hereof). See
"Dilution." The Company currently anticipates paying cash dividends on the
Common Stock as determined by the Board of Directors and to the extent the
Company has funds legally available therefor. However, no assurance can be made
that the Company will pay such dividends in the foreseeable future. See
"Dividend Policy."
Volatility of Trading Market; Potential Volatility of Stock Price. There
can be no assurance that an active trading market will develop or be maintained
after this Offering. The initial public offering price of the shares offered
hereby has been determined by negotiations between the Company and the
Representative and may not be indicative of the market price of the shares in
the future. See "Underwriting." The market price of the Company's shares may be
highly volatile. Factors such as fluctuations in the Company's quarterly
operating results, general economic, political and market conditions in the
U.S., Asia and the other markets in which the Company sells or manufactures, or
military conflicts, may have a materially adverse impact on the price and
marketability of the shares. Furthermore, stock markets historically have
experienced systemic volatility which has adversely affected the market prices
of securities of many companies without regard to the operating performances of
such companies. Accordingly, no assurance can be given that the market price for
the shares will not fall below the initial public offering price. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."
Shares Eligible for Future Sale. Upon completion of this Offering, the
Company will have 6,252,381 issued and outstanding shares of Common Stock. Of
these shares, the shares offered hereby will be freely
11
<PAGE> 13
tradeable without restriction or limitation under the Securities Act of 1933, as
amended (the "Securities Act"), except for any shares purchased by "affiliates"
of the Company, as such term is defined under the Securities Act. The remaining
shares held by affiliates of the Company will be "restricted securities" within
the meaning of Rule 144 adopted under the Securities Act. Sales of such
restricted shares in the public market, or the availability of such shares for
sale, could have a materially adverse effect on the market price of the shares
purchased in this Offering. The Company has reserved 500,000 shares of Common
Stock for issuance under its 1997 Stock Incentive Plan. In connection with the
Offering, the Company is issuing to Van Kasper & Company (the "Representative")
a warrant to purchase a number of shares of Common Stock equal to 10% of the
shares sold in this Offering (the "Representative's Warrant"). The Company
intends (and in the case of the Representative's Warrant, is obligated) to file
registration statements under the Securities Act to register the shares subject
to such options and warrant and, upon effectiveness thereof, such shares will be
freely tradeable in the open market (subject to Rule 144 limitations applicable
to affiliates).
Subject to certain exceptions, the Company, its officers and directors and
certain existing stockholders who, in the aggregate, hold 3,997,238 shares of
Common Stock have agreed not to, directly or indirectly, offer, sell, contract
to sell, grant an option for the sale of, or otherwise dispose of any shares or
rights to purchase shares (except for issuances by the Company of options to
purchase shares pursuant to the Company's Stock Incentive Plan) for a period of
180 days after the effective Date of the Offering (the "Lock-up Period") without
the prior written consent of the Representative. Following expiration of the
Lock-up Period, the shares subject to such lock-up will be eligible for sale,
subject to the conditions and restrictions of Rule 144 (unless such securities
are registered under the Securities Act, in which case the conditions and
restrictions of Rule 144 would be applicable only to affiliates). The sale of
substantial shares into the public market in the future could adversely affect
the market price of the Company's stock. See "Shares Eligible for Future Sale"
and "Underwriting."
12
<PAGE> 14
THE COMPANY
Flour City Architectural Metals, Inc., a Delaware corporation ("FCAM"), was
formed in 1893 under the name Flour City Ornamental Iron Company as a specialty
metals fabricator for the architectural industry. Immediately prior to January
1997, FCAM was a wholly-owned subsidiary of Armco, Inc., a publicly traded U.S.
corporation ("Armco"). Effective January 1, 1997, Armco sold all of the stock of
FCAM (the "Armco Sale") to Flour City International, Inc., a Nevada corporation
("FCI"). On January 17, 1997, FCI entered into a share exchange agreement with
the stockholders of Hockley International Limited (which later changed its name
to Flour City Architectural Metals (Pacific) Ltd. ("FCAM Pacific")) pursuant to
which FCAM Pacific became a wholly-owned subsidiary of FCI (the "FCAM Pacific
Acquisition"). The Armco Sale and the FCAM Pacific Acquisition are referred to
herein as the "Business Combination." FCAM Pacific currently serves as a holding
company for the Asian Companies (as defined below). On May 16, 1997, FCI
effected the Public Merger (as defined below).
As used herein, (i) the "Asian Companies" means FCAM Pacific and its
subsidiaries, Wall Art Design & Engineering Co., Ltd., a Hong Kong corporation,
and Mario and Mario Company, Ltd., a Labuan, Malaysia corporation ("MMC"), MMC's
wholly-owned subsidiaries Flour City Architectural Metals (Asia) Ltd., a Hong
Kong corporation ("FCAM Asia"), and Kasion International, Inc., a Texas
corporation ("Kasion International"), Kasion International's wholly-owned
subsidiary, Kasion F.C. Ltd., a Thailand corporation ("KFC") and FCAM Asia's
minority interest in Foshan Weidu Aluminum Window Manufacturing Co., Ltd., a PRC
corporation, and Foshan Weidu Decoration Engineering Co., Ltd., a PRC
corporation, and (ii) the "Public Merger" means the merger on May 16, 1997 of
FCI with and into International Forest Industries, Inc., a Nevada corporation
("IFI"), which had its shares quoted on the National Association of Securities
Dealers, Inc. Over-the-Counter ("OTC") Bulletin Board. IFI was the surviving
corporation following the Public Merger and, in connection therewith, changed
its name to Flour City International, Inc.
FCAM Pacific was incorporated on May 4, 1993 under the laws of the British
Virgin Islands. IFI was incorporated in 1987 under the laws of the State of
Nevada and was formerly known as M.M. Cork Enterprises, Inc. FCI was
incorporated on January 16, 1997 under the laws of the State of Nevada. The
Company's principal executive offices are located at 915 Riverview Drive, Suite
One, Johnson City, Tennessee 37601, and its telephone number is (423) 928-2724.
13
<PAGE> 15
USE OF PROCEEDS
The net proceeds to the Company from the sale of the 2,000,000 shares of
Common Stock offered hereby are estimated to be $19.6 million ($22.6 million if
the Underwriters' Over-Allotment Option is exercised in full), after deducting
underwriting discounts and estimated offering expenses and assuming an initial
public offering price of $11.00 per share (the midpoint of the range stated on
the cover hereof). The Company intends to use the net proceeds as follows:
approximately $5.0 million to establish or acquire an interest in a curtain wall
fabrication facility in the PRC; approximately $3.0 million for capital
expenditures in connection with its joint venture with Grupo IMSA in Monterrey,
Mexico and at its Johnson City, Tennessee fabrication facility; and the balance
of approximately $11.6 million to obtain project bonding facilities and for
working capital and general corporate purposes. Pending application of the net
proceeds as described herein, the Company intends to invest the net proceeds in
short-term, interest-bearing, investment grade securities.
CAPITALIZATION
The following table summarizes as of October 31, 1997 the actual
capitalization of the Company and the capitalization of the Company as adjusted
to reflect (i) the sale of 2,000,000 shares of Common Stock in the Offering at
an assumed initial public offering price of $11.00 per share (the midpoint of
the range stated on the cover page hereof) and application of the net proceeds
thereof and (ii) the repurchase in November 1997 of 107,143 shares as described
in Note 13 of Notes to the Consolidated Financial Statements. See "Use of
Proceeds." This table should be read in conjunction with "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
the Consolidated Financial Statements and related notes appearing elsewhere in
this Prospectus.
<TABLE>
<CAPTION>
OCTOBER 31, 1997
-------------------
AS
ACTUAL ADJUSTED
------ --------
(DOLLARS IN
THOUSANDS)
<S> <C> <C>
Current portion of long term debt................................ $ -- $ --
====== =======
Long-term debt................................................... -- --
------ -------
Stockholders' equity:
Common Stock, $.0001 par value, 50,000,000 shares authorized;
4,252,381 shares issued and outstanding 6,252,381 shares
issued and outstanding, as adjusted......................... $ 3 $ 3
Additional paid-in capital..................................... 1,853 21,235
Retained earnings.............................................. 6,986 6,986
Unearned compensation.......................................... (287) (287)
Cumulative translation adjustment.............................. 792 792
Stock subscription receivable.................................. (188) --
------ -------
Total stockholders' equity.................................. 9,159 28,729
------ -------
Total capitalization................................... $9,159 $28,729
====== =======
</TABLE>
DIVIDEND POLICY
The Company currently intends to pay annual cash dividends on the Common
Stock in the amount of $0.02 per share. Future policy with respect to payment of
dividends on the Common Stock will be determined by the Board of Directors based
upon conditions then existing, including the Company's earnings and financial
condition, capital requirements and other relevant factors. See "Risk
Factors -- Dilution; Dividends."
14
<PAGE> 16
PRICE RANGE OF COMMON STOCK
The following table sets forth the range of high and low bid quotations per
share for the Company's Common Stock for the periods indicated as reported by
the OTC Bulletin Board, where the stock trades under the symbol "FCIN." Such
market quotations reflect inter-dealer prices, without retail mark-up, mark-down
or commission and may not necessarily represent actual transactions. The
following prices have not been adjusted to reflect the 1 for 7 reverse stock
split expected to be effected prior to consummation of the Offering. See
"Prospectus Summary."
<TABLE>
<CAPTION>
YEAR CALENDAR PERIOD HIGH LOW
- ---- ----------------------------------------------------------- ----- -----
<S> <C> <C> <C>
1997 Second Quarter (from May 16, 1997)(1)...................... $2.00 $1.00
Third Quarter.............................................. 1.25 0.88
Fourth Quarter............................................. 1.25 0.50
</TABLE>
- ---------------
(1) The effective date of the Public Merger. See "The Company."
On January 6, 1998 the last sale price of the Common Stock as reported on
the OTC Bulletin Board was $0.75 per share. As of January 6, 1998, there were
approximately 120 holders of record of the Common Stock.
DILUTION
The net tangible book value per share of the Common Stock as of October 31,
1997 was approximately $1.86. Net tangible book value per share is equal to the
total tangible assets of the Company, less total liabilities plus negative
goodwill, divided by the number of shares of Common Stock outstanding. After
giving effect to the sale of 2,000,000 shares of Common Stock offered hereby and
the application of the net proceeds therefrom (at an assumed initial public
offering price of $11.00 per share and after deducting the estimated offering
expenses and underwriting discount), the net tangible book value per share of
the Common Stock would have been approximately $4.40. This represents an
immediate increase in net tangible book value of $2.54 per share to the existing
stockholders and an immediate dilution of $6.60 per share to new investors
purchasing Common Stock in the Offering. The following table illustrates this
per share dilution:
<TABLE>
<S> <C> <C>
Assumed initial public offering price per share............... $11.00
Net tangible book value per share as of October 31,
1997(1).................................................. $1.86
Increase per share attributable to new investors............ 2.54
-----
Net tangible book value per share after the Offering.......... 4.40
------
Dilution per share to new investors........................... $ 6.60
======
</TABLE>
The following table summarizes, for the existing stockholders and new
investors, a comparison of the number of shares of Common Stock acquired from
the Company, the percentage ownership of those shares, the total consideration,
the percentage of total consideration and the average price per share.
<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION AVERAGE
--------------------- ----------------------- PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
--------- ------- ----------- ------- ---------
<S> <C> <C> <C> <C> <C>
Existing
stockholders(1)(2)....... 4,252,381 68.0% $ 100 0.0% $ 0.00
New investors.............. 2,000,000 32.0 22,000,000 100.0 11.00
--------- --- ----------- -----
Total............ 6,252,381 100.0% $22,000,100 100.0%
========= === =========== =====
</TABLE>
- ---------------
(1) After giving effect to the November 1997 repurchase of 107,143 shares as
described in Note 13 of Notes to the Consolidated Financial Statements.
(2) Excludes 200,000 shares of Common Stock subject to options to be granted to
employees and directors of the Company upon the closing of the Offering at
an exercise price per share equal to the initial public offering price. See
"Management -- Stock Option Plan."
15
<PAGE> 17
SELECTED FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)
The historical statement of income and balance sheet data below set forth
the financial data of the Company as of October 31, 1997, and for the year ended
October 31, 1997, and are derived from the financial statements audited by
Deloitte & Touche LLP which appear elsewhere in this Prospectus. The historical
statement of income and balance sheet data below set forth the financial data of
the Company as of October 31, 1996, and for each of the two years ending October
31, 1995, and October 31, 1996, and are derived from the financial statements
audited by Deloitte Touche Tohmatsu which appear elsewhere in this Prospectus.
The historical balance sheet data as of October 31, 1994 and 1995 and statement
of income data for the year ended October 31, 1994 below set forth have been
derived from audited financial statements of the Company which do not appear
herein. The historical statement of income and balance sheet data below set
forth as of and for the year ended October 31, 1993 are unaudited. In the
opinion of management, such unaudited financial data have been prepared on the
same basis as the audited data referred to above. The unaudited pro forma
statement of income data for the year ended October 31, 1997 present certain
financial information for the Company as adjusted for the Business Combination
and the Public Merger as if each had occurred on November 1, 1996. The following
data should be read in conjunction with "The Company," "Management's Discussion
and Analysis of Financial Condition and Results of Operations" and the
Consolidated Financial Statements and notes thereto and the Unaudited Pro Forma
Financial Information and notes thereto included elsewhere in this Prospectus.
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31, PRO-FORMA
---------------------------------------------------- YEAR ENDED
1993 1994 1995 1996 1997 OCTOBER 31, 1997
------- ------- ------- ------- ------- -----------------
<S> <C> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENT OF INCOME DATA:
Revenues......................................... $ 354 $3,921 $4,806 $6,684 $31,875 $35,229
Gross profit..................................... 161 1,321 2,034 3,019 13,845 14,495
Selling, general and administrative expenses..... 238 532 1,006 1,353 6,117 6,646
Non-cash stock compensation expense.............. -- -- -- -- 57 57
Amortization of negative goodwill................ -- -- -- -- (364) (437)
Amortization of goodwill and organizational
costs.......................................... -- -- -- -- 104 126
------ ------ ------ ------ ------ ------
Operating income (loss).......................... (77) 789 1,028 1,666 7,931 8,103
Other income (expense), net...................... -- 78 123 40 (958) (942)
------ ------ ------ ------ ------ ------
Income (loss) before minority interest and income
taxes.......................................... (77) 867 1,151 1,706 6,973 7,161
Net income (loss)................................ (77) 819 996 1,548 5,226 5,414
====== ====== ====== ====== ====== ======
Net income (loss) per share(1)................... $ (0.02) $0.23 $0.28 $0.43 $1.28 1.26
====== ====== ====== ====== ====== ======
Weighted average shares outstanding(1)........... 3,597 3,597 3,597 3,597 4,097 4,293
</TABLE>
<TABLE>
<CAPTION>
OCTOBER 31,
----------------------------------------------- OCTOBER 31, 1997
1993 1994 1995 1996 1997 AS ADJUSTED(2)
----- ------ ------ ------ ------- ----------------
<S> <C> <C> <C> <C> <C> <C>
CONSOLIDATED BALANCE SHEET DATA:
Working capital....................................... (230) 792 338 1,104 8,511 28,081
Total assets.......................................... 425 1,190 4,136 7,780 22,569 42,139
Long-term debt........................................ -- -- -- -- -- --
Stockholders' equity.................................. (77) 743 1,107 1,870 9,159 28,729
</TABLE>
- ---------------
(1) Excludes 200,000 shares of Common Stock subject to options to be granted to
employees and directors of the Company upon the closing of the Offering at
an exercise price per share equal to the initial public offering price. See
"Management --Stock Incentive Plan."
(2) Adjusted for the sale of 2,000,000 shares of Common Stock offered hereby and
the application of the estimated net proceeds therefrom. See "Use of
Proceeds."
16
<PAGE> 18
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the Company's
consolidated financial statements and the related notes thereto and the other
financial information included elsewhere in this Prospectus. This discussion
contains forward-looking statements that involve risks and uncertainties. The
Company's actual results could differ materially from those anticipated in these
forward-looking statements as a result of any number of factors, including those
set forth under "Risk Factors" and elsewhere in this Prospectus.
OVERVIEW
Until January 1997, the Company's subsidiary, FCAM, was a wholly-owned
subsidiary of Armco. In January 1997, Armco sold all of the stock of FCAM to FCI
(the "Armco Sale") and FCI acquired FCAM Pacific (the "FCAM Pacific
Acquisition") as a wholly owned subsidiary. The Armco Sale and the FCAM Pacific
Acquisition are collectively referred to herein as the "Business Combination."
On May 16, 1997, FCI effected the Public Merger pursuant to which it merged with
and into IFI, with IFI being the surviving corporation. See "The Company" and
"Risk Factors -- Absence of Combined Operating History."
The following discussion sets forth the historical results of operations
and financial condition of the Company for all periods presented as well as the
pro forma operating results of the Company reflecting the results of the
Business Combination as if it had occurred on November 1, 1995. The FCAM Pacific
Acquisition and the Public Merger have both been treated as reverse purchase
acquisitions with FCAM Pacific being considered the acquiring corporation in the
FCAM Pacific Acquisition and FCI being considered the acquiring corporation in
the Public Merger. The Armco Sale was accounted for as a purchase acquisition.
As a result, historical financial information of the Company herein presents
combined results of operations and financial position of the following entities
on and after the date indicated: FCAM Pacific from November 1, 1994; FCAM from
January 1, 1997; FCI from January 17, 1997; and IFI from May 16, 1997. Pro forma
results are not necessarily indicative of the results the Company would have
obtained had these events actually occurred or of the Company's future results.
See "The Company," "Selected Financial Data," "Risk Factors -- Absence of
Combined Operating History," Notes 1 and 13 of Notes to Consolidated Financial
Statements and the Unaudited Pro Forma Financial Information and notes thereto
included elsewhere herein.
From 1992 to 1994, FCAM's operations experienced losses as a result of
industry overcapacity. At the end of 1994, Armco appointed the current
management team, which implemented business practices designed to restore FCAM's
operations to profitability, including overhead cost reductions, project cost
control measures, a more selective approach to project bidding and improvements
in the accuracy of cost estimates for project bids. Management successfully
restored FCAM to profitability in the second half of 1996.
The Company's results of operations are affected primarily by (i) the level
of commercial and government sponsored building construction in its principal
markets, (ii) the Company's ability to win project contracts and its accuracy in
project cost estimating, (iii) the Company's success in utilizing its resources
efficiently, (iv) the Company's ability to complete contracts in a timely and
cost-effective manner and (v) the mix of domestic and international operations.
The level of commercial building construction activity is affected by several
factors, including local, regional, national and international economic and real
estate conditions; interest rates; availability of financing; and office
building occupancy rates in metropolitan areas in which the Company markets its
services. The level of government sponsored construction activity is influenced
by the levels of tax revenues, the need for new or upgraded public facilities
such as airports or courthouses and government spending policies and initiatives
designed to stimulate local or regional economies. The Company expects publicly
funded projects will continue to provide a significant portion of its revenues
for the foreseeable future. Due to economic and currency volatility, the Company
anticipates that fewer projects will become available for bid internationally;
however, the Company has submitted several bids on projects, which if awarded
and completed would result in significant revenue over the next two to three
years.
The Company generally obtains projects at a fixed price through competitive
bidding or negotiation. The Company must estimate its costs, including projected
increases in labor and material service contracts.
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<PAGE> 19
Typically, the Company spends between $50,000 and $150,000 in the preparation
and submission of each project bid, regardless of the success of winning the
bid. This cost is expensed as incurred. Project duration, when installation is
included, generally lasts from 18 to 30 months. See "Risk Factors -- Fixed Price
Contracts."
The Company has experienced in the past, and expects to experience in the
future, substantial variations in its results of operations in any quarterly or
annual reporting period as a result of numerous factors, many of which are out
of the Company's control. In particular, the Company's operating results may
vary because of downturns in one or more segments of the construction industry,
changes in economic conditions, the Company's failure to obtain or delays in
awards of major projects, the cancellation or delay of major projects, the
Company's failure to timely replace projects that have been completed or are
nearing completion, or declines in the amount of the Company's billings in
excess of costs and recognized earnings on uncompleted projects. During fiscal
1997, the Company had two customers, Morse Diesel and Silom Tower Ltd., which
each accounted for more than 10% of its consolidated revenues the loss of either
of which would have a material adverse effect on the Company and its
subsidiaries taken as a whole. See "Risk Factors -- Fluctuations in Quarterly
Results."
The Company recognizes contract revenues attributable to its design,
fabrication and installation and project management using the
percentage-of-completion method. Under this method, estimated contract revenues
are accrued based on a comparison of total costs incurred to date to total
estimated costs. Estimated contract losses are recognized in full when
determined. Accordingly, contract revenues and total cost estimates are reviewed
and revised periodically as work progresses and as change orders are approved.
Adjustments are based upon the percentage of completion and are reflected in
contract revenues in the period when such estimates are revised. See "Risk
Factors -- Percentage-of-Completion Accounting."
Costs of revenues consist of the cost of the materials, equipment, direct
labor, fringe benefits and indirect costs associated with engineering,
fabrication and installation, including supervisory labor. Other costs not
associated with specific projects including costs associated with sales,
accounting services, project management, estimating, administration, management
information systems and material and supply procurement are included in selling,
general and administrative expenses. Selling, general and administrative
expenses include those expenses incurred for preparation of contract bids,
estimating, sales and marketing, office facilities, project management and
support services. The Company believes that it currently has sufficient
management and administrative resources to support continued growth in revenues
without a proportionate increase in selling, general and administrative
expenses.
Gross profit margins can be positively affected by the level of competitive
bidding, aggressive purchasing of component parts necessary for the fabrication
of the products, the number and scope of contract modifications, and
improvements in operating efficiencies. Generally, margins are not affected by
the mix of private and public sector funded projects. Internationally,
comparatively low labor rates often result in higher gross profit margins than
those realized for projects in the U.S. Gross profit margins can be adversely
affected by a wide range of factors, including construction delays, inefficient
or under-utilization of the Company's resources and weather and construction
site conditions. See "Risk Factors."
Backlog increases as contract commitments are obtained, decreases as
revenues are recognized, and increases or decreases to reflect modifications in
the work to be performed under the contract. The timing of contract commitments,
the size of projects and other factors beyond the Company's control can cause
fluctuation in backlog outstanding on any given date.
Historically, a significant portion of the Company's revenues have been
earned in jurisdictions with no income taxes or lower income tax rates than
those in the U.S. As revenues from U.S. projects increase relative to revenues
from international projects, the Company's overall tax rate will increase.
The Company generally attempts to mitigate foreign exchange risk by
entering into contracts providing for payment in U.S. dollars instead of the
local currency where possible, except for local currency necessary to pay local
for labor, raw materials or other costs of operations. There can be no assurance
that the Company will be successful in securing payments in U.S. dollars, or
that fluctuations in foreign currencies and other risks
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<PAGE> 20
will not have a material effect on the Company's financial condition or results
of operations for any quarterly or annual reporting period. To the extent the
Company is required to enter into contracts denominated in foreign currencies,
the Company's financial condition and results of operations may be adversely
affected by volatility in such foreign currencies. See "Risk Factors -- Foreign
Exchange Risk."
RESULTS OF OPERATIONS
YEAR ENDED OCTOBER 31, 1997 COMPARED TO YEAR ENDED OCTOBER 31, 1996
Revenues. Revenues increased by 376.9% to $31.9 million in fiscal 1997 from
$6.7 million in fiscal 1996. The increase was primarily attributable to the
Business Combination. Revenues generated from projects located in Asia increased
91.8% to $12.8 million in fiscal 1997 from $6.7 million in fiscal 1996. This
increase was driven primarily by an increase in the revenue generated by a
single project which increased to $11.0 million from $4.9 million in fiscal 1997
and 1996, respectively. During fiscal 1996, the Company did not generate any
revenue from North American projects since it had not yet acquired FCAM.
Revenues generated by U.S. projects in fiscal 1997 were $19.1 million, as a
result of the inclusion of FCAM from January 1997 forward.
On a pro forma basis, revenues increased by 45.1% to $35.2 million in
fiscal 1997 from $24.3 million in fiscal 1996. This increase was driven
primarily by an increase in the revenue generated by a single project which
increased to $11.0 million from $4.9 million for fiscal 1997 and 1996,
respectively. In fiscal 1997, pro forma revenues generated from Asian projects
were 36.4% of total pro forma revenues while pro forma revenues generated from
Asian projects for the same period in fiscal 1996 accounted for 27.5% of total
pro forma revenues. Pro forma revenues generated by domestic projects increased
to $22.4 million in fiscal 1997, from $17.6 million in fiscal 1996.
Gross profit. Gross profit increased by 358.6% to $13.8 million in fiscal
1997 from $3.0 million in fiscal 1996. The increase was primarily attributable
to the increase in revenues. As a percentage of revenues, gross profit margin
declined to 43.4% in fiscal 1997 from 45.2% in fiscal 1996 primarily because the
Company derived a significant portion of its revenues in fiscal 1996 from one
high-margin project in fiscal 1996 which generated a smaller percentage of
revenues in fiscal 1997.
On a pro forma basis, gross profit increased to $14.5 million in fiscal
1997 from $4.4 million in fiscal 1996. Pro forma gross margin increased to 41.1%
in fiscal 1997 from 18.1% in fiscal 1996. This increase was the result of the
following factors: (i) the revaluation in fiscal 1997 of FCAM contracts in
progress acquired in the Armco Sale to yield margins representing the fair value
of the contracts at that time; (ii) the results in fiscal 1997 of cost
containment practices implemented by the Company's management team during fiscal
1995 and 1996; (iii) the selective targeting in fiscal 1997 of higher-margin
projects on which to bid; (iv) the substantial completion in fiscal 1996 of a
significant number of lower-margin contracts entered into prior to the current
management team's assumption of operations; and (v) an increase in the
percentage of revenues generated from projects located in Asia which have
historically carried higher gross margins.
Selling, general and administrative expenses. Selling, general and
administrative expenses increased by 351.9% to $6.1 million in fiscal 1997 from
$1.4 million in fiscal 1996. This increase was primarily a result of the
Business Combination. Selling, general and administrative expenses as a percent
of sales decreased to 19.2% in fiscal 1997 from 20.2% in fiscal 1996 due to an
increase in revenues for the period without a proportionate increase in selling,
general and administrative expenses.
On a pro forma basis, selling, general and administrative expenses
increased by 6.3% to $6.6 million in fiscal 1997 from $6.3 million in fiscal
1996. This increase was a result of increases at the Company's operations in
Asia, including expenses associated with the addition of new staff,
establishment of a reserve for accounts receivable associated with a customer's
bankruptcy, increased legal expenses primarily associated with the Armco Sale
and minor increases in other expenses. This increase was partially offset by
decreases in salary and associated expenses within the Company's North American
operations. Selling, general and administrative expenses as a percent of sales
decreased to 18.9% from 25.7% in fiscal 1997 and 1996, respectively. This
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<PAGE> 21
decrease resulted from the increase in revenues for the period without a
proportionate increase in selling, general and administrative expenses.
Other operating items. Other operating items include increased operating
income of $200,000 in fiscal 1997 which relate principally to positive and
negative goodwill amortization which resulted from the Business Combination. No
such income was recorded in 1996.
Other income (expense, net) increased to ($958,000) in fiscal 1997 from
$40,000 in fiscal 1996. This increase in other income was caused primarily by
the effect of the devaluation of the Thai Baht that caused a combination of
realized and unrealized exchange losses on payables of KFC denominated in
currencies other than the Thai Baht in July 1997. See "Risk Factors -- Foreign
Exchange Risk."
Income before minority interests and income taxes. Income before minority
interests and income taxes increased by 308.8% to $7.0 million fiscal 1997 from
$1.8 million for fiscal 1996.
On a pro forma basis, the Company generated income before minority
interests and income taxes of $7.2 million for fiscal 1997, compared to a loss
of $1.2 million for the same period in fiscal 1996.
Income taxes. Income taxes increased to $1.8 million in fiscal 1997 from
approximately $150,000 in fiscal 1996. The increase was primarily attributable
to an increase in U.S. income tax as a result of taxation on income earned in
the U.S. as well as U.S. taxation of a portion of the income generated in Asia.
Prior to the Business Combination, the Company was not subject to U.S. income
tax and earned most of its income in jurisdictions with no or relatively low
income tax rates. The Company believes that it will continue to earn a
significant portion of its income outside of the U.S. and that the majority of
its offshore income will not be subjected to U.S. income tax. As revenue from
U.S. projects increases relative to revenues from international projects, the
Company's overall tax rate will increase.
Backlog. The Company's backlog at October 31, 1997 increased to $53.3
million from $16.0 million at October 31, 1996. The increase in backlog was
primarily attributable to the Business Combination. Pro forma backlog as of
October 31, 1997 increased to $53.3 million from $36.7 million as of October 31,
1996. At October 31, 1997, roughly half of the Company's backlog was associated
with projects in the U.S. while the other half was associated with projects in
the Philippines, Thailand and Hong Kong. At October 31, 1997, five project
contracts accounted for 85.0% of the Company's total backlog.
YEAR ENDED OCTOBER 31, 1996 COMPARED TO YEAR ENDED OCTOBER 31, 1995
Revenues. Revenues increased by 39.1% to $6.7 million in fiscal 1996 from
$4.8 million in fiscal 1995. The increase was primarily attributable to
increased work performed on a single large project. Revenues from this project
totaled $4.9 million and $3.4 million during fiscal 1996 and 1995, respectively.
Pro forma revenues decreased by 14.5% to $24.3 million in fiscal 1996 from
$28.4 million in fiscal 1995. On a pro forma basis, the decrease in revenues
resulted from FCAM's implementation of a more selective approach to bidding and
accepting projects.
Gross profit. Gross profit increased by 48.4% to $3.0 million in fiscal
1996 from $2.0 million in fiscal 1995. The increase was attributable to the
increase in revenues along with a more profitable mix of project contracts. As a
percentage of revenues, gross profit margin increased to 45.2% in 1996 from
42.3% in fiscal 1995 because the Company derived a significant portion of its
revenues from one high-margin project in fiscal 1996 which generated a smaller
percentage of revenues in fiscal 1995.
On a pro forma basis, gross profit increased by 133.7% to $4.4 million in
fiscal 1996 from $1.9 million in fiscal 1995. This profit improvement was
primarily attributable to the following: (i) cost containment practices
implemented by the Company's management team; (ii) an increase in the percentage
of revenues generated from projects in Asia which have historically carried
higher gross margins; and (iii) the selective targeting of higher margin
projects on which to bid and selective bidding practices implemented by the
Company's
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<PAGE> 22
management team. As a percentage of revenues gross profit margin increased to
18.1% in fiscal 1996 from 6.6% in fiscal 1995.
Selling, general and administrative expenses. Selling, general and
administrative expenses increased by 34.5% to $1.4 million in fiscal 1996 from
$1.0 million in fiscal 1995. Selling, general and administrative expenses as a
percent of sales decreased slightly to 20.2% in fiscal 1996 from 20.9% in fiscal
1995.
Pro forma selling, general and administrative expenses decreased by 3.0% to
$6.3 million from $6.4 million in fiscal 1996 and 1995, respectively.
Immediately after his appointment as president of FCAM, Mr. Russo developed a
reorganization plan that included selling, general and administrative expense
spending cuts of over $1.8 million during 1995 and 1996. These spending cuts
were offset by increases in staff and related expenses in the Company's Asian
operations.
Income before minority interests and income taxes. Income before minority
interests and income taxes increased by 48.2% to $1.7 million in fiscal 1996
from $1.2 million in fiscal 1995.
On a pro forma basis the Company incurred a net loss before minority
interests and income taxes of $1.4 million in fiscal 1996 and a loss before
minority interests and income taxes of $4.2 million in fiscal 1995.
Backlog. The Company's backlog at October 31, 1996 was $16.0 million
compared to $22.7 million at October 31, 1995. In both fiscal 1996 and 1995, the
majority of the Company's backlog was associated with one project in Thailand.
The decline in backlog for such period was primarily driven by the progress made
during the 1996 fiscal year on the Thailand project. On a pro forma basis, the
Company's backlog at October 31, 1996 was $36.7 million compared to $39.4
million at October 31, 1995.
LIQUIDITY AND CAPITAL RESOURCES
The Company attempts to structure payment arrangements with its customers
to match costs incurred under the project. To the extent the Company is not able
to match costs, it relies on its cash reserves and its credit facility to meet
its working capital needs. As of October 31, 1997, the Company had approximately
$460,000 in borrowings under its line of credit. As of October 31, 1997, the
Company had working capital (current assets less current liabilities) of $8.5
million. The Company believes that it has sufficient liquidity through its
present resources to meet its financial needs for the short term and currently
foreseeable future.
The Company currently maintains a $1.3 million line of credit with a
commercial bank that is subject to renewal on April 30, 1998. This line of
credit is primarily used to provide letters of credit in connection with the
importation of goods and overdraft facilities. The credit line is secured by a
pledge of Company assets and personal guarantees of certain officers. Upon
completion of the Offering, the Company intends to attempt to secure a larger
line of credit under more favorable terms.
The Company's short term cash needs are primarily for working capital to
support operations including receivables and to pay costs incurred in performing
its contracts. Operating activities used cash flows of $784,000 in fiscal 1997.
For fiscal 1997, operating cash flows were less than net income due to a
substantial decrease in the Company's billings in excess of costs and recognized
earnings on uncompleted contracts and a significant increase in the Company's
outstanding accounts receivable. These cash outflows were partially offset by an
increase in the Company's accounts payable. Investing activities required
$436,000 for the year ended October 31, 1997. These funds were used primarily
for the purchase of new engineering computer hardware and software. Financing
activities provided cash of approximately $424,000 from short-term draws on
credit facilities during fiscal 1997. For certain financial information with
respect to the Company's foreign operations, see Note 8 of Notes to Consolidated
Financial Statements.
YEAR 2000 COMPLIANCE
Management of the Company believes that the software packages currently in
use and expected to be in use prior to the year 2000 are year 2000 compliant.
Management does not expect the financial impact of required modifications to
such software, if any, will be material to the Company's financial position,
cash flows or results of operations in any given year.
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<PAGE> 23
EFFECT OF INFLATION
During the past three years, the rate of inflation in many of the Southeast
Asian countries in which the Company operates has ranged from approximately 8%
to 25% per year. However, the Company generally has been able to reduce the
impact of inflation on profitability by increasing the prices of its products
and reducing operating costs. No assurance can be given that the Company will be
able to minimize the impact of inflation on profitability in the future.
RECENTLY ISSUED ACCOUNTING STANDARDS
Earnings per share -- In February 1997, the Financial Accounting Standards
Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No.
128, Earnings Per Share. SFAS No. 128 specifies the computation, presentation
and disclosure requirements for earnings per share ("EPS"). This new standard
requires the presentation of basic earnings per share based upon average common
shares outstanding and a diluted EPS based on average common shares outstanding
plus the dilutive effect of potential common shares. SFAS No. 128 is effective
for years ending after December 15, 1997 and early adoption is not permitted.
Upon the adoption of SFAS No. 128, EPS for prior periods will be restated to
conform to the new standard. The Company believes that the adoption of SFAS No.
128 will cause the Company to present diluted earnings per share equal to
earnings per share as presented in the Company's financial statements.
Segment information -- In June 1997, the FASB issued SFAS No. 131,
Disclosures About Segments of an Enterprise and Related Information, which
supersedes portions of SFAS No. 14, Financial Reporting for Segments of a
Business Enterprise. SFAS No. 131 is effective for the Company commencing in its
year ending October 31, 1999. Company management has not completely assessed the
effects of SFAS No. 131 on its segment reporting, however, it does not currently
believe that there will be significant changes from the information currently
being reported.
Comprehensive income -- In June 1997, the FASB issued SFAS No. 130,
Reporting Comprehensive Income, which becomes effective for the Company
commencing in its year ending October 31, 1999. Company management does not
believe, based on current activities, that adoption of this statement will have
a significant effect on its financial statements except to the extent that
cumulative foreign currency translations are included in comprehensive income.
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BUSINESS
The following Business section contains forward-looking statements that
inherently involve risks and uncertainties. The Company's actual results could
differ materially from those anticipated in these forward-looking statements as
a result of any number of factors, including those set forth under "Risk
Factors" and elsewhere in this Prospectus.
COMPANY OVERVIEW
Flour City is one of the world's leading full-service providers of custom
curtain wall in commercial and monumental high-rise construction. The Company
and its predecessors have been involved in the design, fabrication and
installation of custom curtain wall systems in the U.S. since the modern
high-rise emerged over 50 years ago. Some of the most prestigious buildings in
the world are accented by custom curtain wall systems designed, fabricated, and
installed by the Company including: Citicorp Center, JFK Airport Terminal One
and 320 Park Avenue (Mutual of America) in New York City; First Interstate Bank
Tower in Los Angeles; the Rock and Roll Hall of Fame and Key Tower in Cleveland;
Empire Towers in Bangkok; the Allied Bank Tower (Fountain Place) in Dallas; the
United Airlines Terminal and International Terminal at O'Hare Airport in
Chicago; G.T. International Tower in Manila and the IDS Building in Minneapolis.
The Company offers a complete range of custom curtain wall services
including in-house design, engineering, manufacturing, assembly, installation
and project management. The Company actively participates in the architectural
design stage of its projects, and it has excellent marketing and working
relationships with major international architects, including Skidmore Owings &
Merrill, Kohn Pederson & Fox and Pei Cobb. The Company also has strategic
relationships with several of the most respected international developers and
project managers, including Bechtel, New World Development, Mitsui, Turner
Construction and Morse Diesel. These relationships serve to promote the
Company's participation in bidding on desirable projects and allow the Company
to leverage its management and technological expertise with low-cost, localized
labor and market knowledge. As a result, the Company is able to offer a complete
range of services, from initial design through final installation, for unique
and sophisticated custom curtain wall projects.
The decline of activity in the U.S. construction market in the early 1990's
reduced the number of companies that provide a full range of services in
connection with the design and installation of custom curtain wall. After this
industry contraction, the Company remained as one of the few full-service custom
curtain wall companies in the U.S. As a result, the Company is invited to bid on
a large percentage of the commercial custom curtain wall projects which come to
market in the U.S. and overseas. This position allows the Company to target
projects which best utilize the Company's management and production capabilities
which offers the greatest opportunities for attractive margins.
INDUSTRY BACKGROUND
The term "curtain wall" is used to describe the non-load bearing external
walls of modern mid-rise and high-rise buildings, which consist of a combination
of glazing, cladding elements and supports to attach the custom curtain walls to
the main building structure. The curtain wall market is composed of standard and
custom segments. Standard curtain wall typically consists of stock components
which can be manufactured with minimal design and engineering at relatively low
cost and corresponding low margins. Alternatively, custom curtain wall often
includes unique and irregular designs manufactured according to site-specific
requirements, typically at higher margins.
Custom curtain wall defines high-rise and monumental buildings from an
aesthetic and architectural perspective. Custom curtain wall systems also serve
a wide range of practical purposes, including protecting the building interior
from the elements and allowing for cost savings through more efficient heating
and ventilation. The custom curtain wall component of a typical high rise
building will represent between 5% and 15% of the overall cost of the project.
The types of structures which utilize custom curtain wall systems include
mid-rise and high-rise buildings, campus-style buildings, hotels and airport
terminals. Glass and glazing technologies utilized in the custom curtain wall
industry also have applications in other structures such as bus and telephone
enclosures.
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Custom curtain wall panels are produced and assembled in a factory setting
with minimal on-site operation, as opposed to the hand-cladded method of using
bricks and cement to constitute the facade of a building. Custom curtain wall
construction requires expertise in various external building materials,
including marble, granite and other stone, aluminum, steel and precast concrete,
sealed and operable window systems, and systems for securely attaching outside
panels to building superstructures. Custom curtain walls allow repair work to be
carried out to the facade of the building by the replacement of a damaged wall
panel without affecting the entire external facade of the building. The
deterioration and failure of older curtain wall systems have also created demand
for the repair or installation of new custom curtain wall systems to modernize
or refurbish existing buildings and structures.
U.S. DOMESTIC MARKET
Based on estimates by F.W. Dodge, a unit of McGraw-Hill Construction
Information Group ("F.W. Dodge"), the value of the 1997 U.S. construction market
was $125 billion. Based on the Company's internal estimates, the Company
believes that the U.S. custom curtain wall construction segment of the market
had an approximate value in 1997 of $830 million.
The custom curtain wall segment of the construction industry is driven by
several factors. The need for and development of mid-rise, campus style and
high-rise buildings, which drives demand for custom curtain wall systems, is
influenced by the supply and demand of premium office space as well as
industrialization, urbanization, suburbanization and population growth. The
Company believes that decreasing vacancy rates often lead to increased rents,
which in turn contribute to increased private sector construction spending, a
portion of which will utilize custom curtain wall systems.
The U.S. has seen an increased use of custom curtain wall systems in public
sector buildings and buildings with heavy public use, such as the JFK Airport
Terminal One in New York City, the United Airlines Terminal and the
International Terminal at O'Hare Airport in Chicago and the Boston and
Minneapolis Courthouses. The construction of public sector projects is usually
supported by taxation or the need for new or upgraded public facilities. Public
sector buildings tend to be designed for a longer life cycle, which in turn
requires a curtain wall system that can provide superior performance with
limited maintenance. Contracts for installation of custom curtain wall systems
in public sector buildings have presented an area of growth for the Company.
The following table sets forth for the years indicated U.S. office vacancy
rates based upon data from C.B. Commercial Real Estate Group ("CB Commercial")
and the concomitant construction spending based upon data from the U.S. Commerce
Department:
<TABLE>
<CAPTION>
NON-RESIDENTIAL
CONSTRUCTION
SPENDING
YEAR VACANCY RATE (IN BILLIONS)
- ----- ------------- -----------------------------------
<S> <C> <C>
1990 19.0% $ 187
1991 18.5 164
1992 18.0 156
1993 16.7 163
1994 15.8 174
1995 14.5 194
1996 13.8 201
1997 11.6(1) 207(2)
</TABLE>
- ---------------
(1) Through the first quarter of 1997.
(2) Projected for 1997.
CB Commercial has predicted that overall domestic office vacancy rates will
reach single digits by the end of 1998, a level of vacancy not seen since 1982.
In some metropolitan areas such as San Francisco, Washington,
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<PAGE> 26
D.C., and Boston, vacancy rates have approached a five-year low and new
development projects have commenced.
INTERNATIONAL MARKETS
Southeast Asia. Recently, the World Bank revised its forecasted 1998 growth
rates for Southeast Asian economies: estimating Hong Kong at 4.1%, the
Philippines at 3.8%, and Indonesia at 2.0%. Despite the recent economic
volatility, demand for taller, premium office buildings in selected regions
remains strong. For example, according to Richard Ellis Ltd., well known
international property consultants, as of January 1997 the office vacancy rate
in Manila was 4%, with prime office space remaining tight through July 1997.
Richard Ellis Ltd. also estimated that as of July 1997 that the vacancy rate in
Hong Kong's most prestigious location, Core Central, was 2.5%. The Company
believes that this continued demand for premium office space will continue to
support increased demand for construction of buildings which utilize custom
curtain wall. While the Company does not believe that all nations in Southeast
Asia will continue to build their infrastructure at the rates seen in the recent
past, the Company believes that the PRC, Hong Kong, and the Philippines may
continue to be significant markets in the coming years. See "Risk
Factors -- Risks Related to International Operations."
Latin America. The increase in economic activity in Latin America, which
started in mid-1996, continues to accelerate, especially in Mexico, Argentina,
Brazil and Peru. The OECD forecasts that economic activity should remain strong
across the region with larger countries likely to experience output growth
through 1998 from 3% to 6%. The Company intends to pursue projects in Latin
America. The stabilization of the Mexican peso and the Company's strategic
alliance with Grupo IMSA should assist the Company in securing custom curtain
wall projects in the growing Latin American construction industry.
BUSINESS STRATEGY
The Company intends to build on its reputation as a world-wide leader in
the custom curtain wall industry to support continued growth and increased
profitability. The key elements of the Company's strategy to accomplish these
goals are to: (i) selectively target high margin projects; (ii) maintain and
develop key strategic relationships; (iii) exploit its full service, custom
capabilities; (iv) enhance and exploit its position as a low cost manufacturer;
and (v) capitalize on its global presence.
Selectively target high margin projects. The Company's unique mix of
management and technical expertise, familiarity with overseas markets and key
strategic relationships has positioned the Company as one of the few remaining
full-service providers of custom curtain wall systems. As a result, the Company
is invited to bid on a large percentage of the commercial curtain wall projects
which come to market in the U.S. and overseas. This position allows the Company
to target projects which best utilize the Company's management and production
capabilities, offering the greatest opportunity for attractive margins.
Maintain and develop key strategic relationships. The Company has
established several strategic relationships to secure and complete domestic and
international projects. The Company has established relationships worldwide with
several of the world's most respected architects, developers and project
managers, including Bechtel, New World Development, Mitsui, Turner Construction,
Morse Diesel, Skidmore Owings & Merrill, Kohn Pederson & Fox and Pei Cobb. The
Company believes that these strategic relationships enhance its participation in
the bidding process for the most desirable projects worldwide and help to
facilitate smooth project execution.
Exploit full-service, custom capabilities. As one of the few full-service
custom curtain wall companies, the Company provides the entire range of custom
curtain wall services including in-house design, engineering, manufacturing,
assembly, installation and project management. The Company applies its design
expertise to adapt systems to a wide variety of custom curtain wall
applications. General contractors and developers often prefer to limit the
number of subcontractors on a particular project and favor full-service
providers due to the greater responsibility and accountability they can provide.
Minimize cost structure. The Company's technological expertise developed
through 50 years of U.S. experience in custom curtain wall applications combined
with the use of local project management and labor
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allow the Company to minimize its cost structure and reduce the risk of project
delays. During the design phase, the Company uses proprietary advanced computer
aided design ("CAD") software to decrease design time and minimize raw materials
expense. During the fabrication and installation phases the Company uses local
labor and overseas manufacturing in the most cost-efficient locales. These
efficiencies serve to lower the Company's project costs and to maximize the
likelihood of completing projects with attractive margins.
Capitalize on global presence. With offices in Hong Kong, New York, Dallas,
Chicago and Shanghai, the Company is positioned to participate in the most
active construction markets in the world, including the U.S., Asia and Latin
America. The Company combines its technological expertise developed in the U.S.
with local management teams to both secure projects and realize cost savings
through design innovation, unique manufacturing strategies and management of
local labor. The Company believes that the international composition of its
management team provides a significant competitive advantage over its largest
U.S. competitors who typically rely on expatriates for senior level project
management.
SALES AND MARKETING
The fostering of strategic relationships in the construction industry
constitutes a key element in marketing the Company's services and products. The
Company seeks to build on its relationships with architects in the early design
phase of projects. By having designs it assisted in creating included in the
project specifications, the Company's prospects of being invited to bid on a
project are maximized and the Company gains a competitive advantage through
familiarity with a project's design. The Company also uses its relationships
with significant developers, contractors and consultants to secure invitations
to bid on monumental custom curtain wall projects worldwide. The Company's
history as one of the oldest custom curtain wall companies in the industry,
combined with its reputation and capabilities as a full service provider of
custom curtain wall systems, enhances its opportunities to selectively bid on
global projects.
The Company's management expertise is extremely valuable in the preparation
of a successful and profitable bid. Management's expertise allows it to
incorporate cost-saving techniques into the manufacturing and installation
phases of projects. After receiving tender documents from the project developer
or general contractor, the Company is typically given four to six weeks to
prepare a bid for the project. After developing a project-specific design, the
Company critiques the design for cost and technical performance. At this stage,
the Company is often able to use its expertise to develop a design that is not
only cost effective but also efficiently manufactured and installed, thereby
reducing the overall custom curtain wall cost to the developer or general
contractor. After finalizing the design, the Company develops comprehensive
material requirements, engineering, manufacturing and installation labor
analysis that is initially reviewed by a department manager and then by senior
management, prior to submission of the Company's project bid.
The selection of a winning bid usually occurs four to six weeks after
submission of the custom curtain wall design bid. Bid price, reputation,
completion schedule and system design are the primary factors considered in
awarding the custom curtain wall contract to the prevailing bidder. The Company
believes that its reputation for providing high quality, technically proficient
products is an invaluable factor in being considered for project awards because
it distinguishes the Company from certain competitors who compete for projects
solely on price. The typical cost incurred by the Company to submit a
comprehensive bid with system design ranges from approximately $50,000 to
$150,000, regardless of whether the Company's bid is selected as the winning
bid.
OPERATIONS
From the moment a custom curtain wall project contract is awarded, the
Company employs a structured process to attain the highest levels of efficiency
and quality. The Company employs a multi-discipline process to maximize project
success.
Project Management. Upon execution of a letter of intent, the Company
establishes a project management team led by a senior project manager. Design
personnel meet with the production engineering group to review the custom
curtain wall system design. The senior project manager, generally located on
site, maintains direct contact with the general contractor, coordinates the
Company's different departments and oversees the
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<PAGE> 28
Company's subcontractors. An engineering job captain supervises the project team
engineering staff, maintains the engineering schedule and communicates with
fabrication, assembly, and site personnel to ensure a "user friendly" design. On
site, a superintendent oversees assembly and installation and provides status
reports to the project manager. Senior management's close involvement in the
Company's projects is an integral component for timely project execution. A
typical custom curtain wall project for the Company lasts approximately 18 to 30
months from commencement through completion, depending upon size and complexity.
Engineering. The Company's engineering process begins upon the Company's
receipt of architectural drawings for a project for which the Company intends to
bid. Composed of experienced engineers and draftsman, the Company's engineering
group designs a custom curtain wall system that will provide the desired
aesthetic qualities inherent in the architectural drawings, together with the
performance capabilities required by the project specifications, including water
penetration, air filtration and seismic capabilities. During the system design
stage, the Company utilizes its expertise to design a system that not only meets
or exceeds the project specifications, but that can also be efficiently
manufactured and installed. Once the Company has been awarded a project, the
Company's drafters prepare drawings detailing each of the separate unit types
and conditions for the various custom curtain wall systems which are sent to the
architect, general contractor and owner for review and approval. After these
drawings are approved, an independent laboratory procures and tests mock-up
materials. This testing process is designed to ensure that the custom curtain
wall will meet the required performance criteria. Drafting of construction shop
drawings commences immediately after the submission of mock-up drawings, and all
drawings are then submitted to the main contractor. The Company submits
structural design calculations, thermal modeling and other technical information
as part of the shop drawing program and then finalizes fabrication papers,
assembly drawings, and bills of materials. These documents provide the
instructions for the production of a final custom curtain wall and the blueprint
for the procurement process.
To support its engineering and design functions the Company has established
engineering departments in both the U.S. and Asia with experienced technical
staff. The Company is committed to using modern technology and is equipped with
CAD hardware and software to improve the efficiency of the engineering process
and to provide technologically superior designs.
Project Execution. Upon completion and approval of the final curtain wall
design, the Company purchases the necessary raw materials, such as granite,
glass and aluminum. Thereafter, the raw materials are sent to one of the
Company's three fabrication facilities located in Johnson City, Tennessee,
Foshan, PRC or Monterrey, Mexico for fabrication and assembly of the individual
modules comprising the custom curtain wall system. The Company selects the
fabrication facility for any given project based on the location of the project
and its proximity to the particular fabrication facility. If the curtain wall
contract mandates performance testing, the Company will schedule the performance
test to be conducted at an independent third party testing facility. Typical
tests include the use of static and dynamic pressure, air infiltration, water
penetration and proof tests to prove the effectiveness of the materials used for
structural performance against design loads. The Company makes modifications and
the independent laboratory retests materials whenever necessary to ensure that
the specified performance is achieved. The Company then includes all changes
required to ensure that the specified performance criteria are satisfied.
Thereafter, the Company fabricates and assembles the modules comprising the
custom curtain wall system and prepares the modules for delivery to the project
site.
Once the modules arrive at the project site, they are installed under the
oversight of the Company's project managers and engineers. In the U.S., the
Company often utilizes members of the Architectural and Ornamental Ironworkers
Union or the International Union of Operating Engineers to install the
individual curtain wall modules. Internationally, the Company usually contracts
with third party installation companies for installation services. If third
party installation companies are unavailable, the Company has the ability to
provide its own installation workforce for a given project. Variations in the
scope of work as a project progresses result in additive and deductive work and
changes, thereby changing the amount owed under the contract.
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<PAGE> 29
PROJECTS
Recently Completed and Pending Projects. The Company has successfully
completed a considerable number of projects in the U.S. and Asia. Some of the
Company's major completed and pending projects are set forth below (* denotes
pending projects), grouped according to the estimated contract value for the
project:
ESTIMATED CONTRACT VALUE IN EXCESS OF $15 MILLION
<TABLE>
<CAPTION>
PROJECT LOCATION COMPLETION DATE(1) OWNER/DEVELOPER GENERAL CONTRACTOR
- ---------------------- -------------------- ------------------ ----------------------------- -----------------------------
<S> <C> <C> <C> <C>
Rockwell International Chantilly, VA 3rd Quarter 1995 Rockwell International Clark Construction
Foley Square New York, NY 4th Quarter 1995 Bechtel Park Tower Realty Lehrer McGovern Bovis
Courthouse
Empire Towers* Bangkok, Thailand 3rd Quarter 1998 Silom Tower Ltd. Bechtel
G.T. International Manila, Philippines 4th Quarter 1999 Philippines Securities C.E. Construction Corporation
Tower*
</TABLE>
ESTIMATED CONTRACT VALUE BETWEEN $5 TO 15 MILLION
<TABLE>
<CAPTION>
PROJECT LOCATION COMPLETION DATE(1) OWNER/DEVELOPER GENERAL CONTRACTOR
- ---------------------- -------------------- ------------------ ----------------------------- -----------------------------
<S> <C> <C> <C> <C>
Asian Terminal Hong Kong 4th Quarter 1995 New World Development Company Hip Hing Construction Company
Building Ltd.("Hip Hing")
320 Park Avenue New York, NY 3rd Quarter 1996 Mutual Life Insurance Company Turner Construction
Minneapolis Courthouse Minneapolis, MN 4th Quarter 1996 Bechtel Park Tower Realty Turner Construction
Courthouse Associates, L.P.
JFK Terminal One New York, NY 4th Quarter 1997 Terminal One Group Assoc. Morse Diesel International
U.C. Davis Medical Davis, CA 4th Quarter 1997 The Regents of the University Centex Golden
Center of California
New York Psychiatric New York, NY 1st Quarter 1998 State of NY HRH/Hill Construction
Institute* Dormitory Authority
Cleveland Health Cleveland, OH 3rd Quarter 1998 Cleveland Clinic Foundation Turner Construction
Services Center*
New York Hospital* New York, NY 2nd Quarter 1997 The New York Hospital Lehrer McGovern Bovis
Swiss Reinsurance New York, NY 3rd Quarter 1998 Swiss Reinsurance Company Turner Construction
World Headquarters*
Cathay Pacific Hong Kong 4th Quarter 1999 Cathay Pacific Airways Ltd. Dragages et Travaux Publics
Terminal* (Hong Kong) Ltd.
</TABLE>
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<PAGE> 30
ESTIMATED CONTRACT VALUE LESS THAN $5 MILLION
<TABLE>
<CAPTION>
PROJECT LOCATION COMPLETION DATE(1) OWNER/DEVELOPER GENERAL CONTRACTOR
- ---------------------- -------------------- ------------------ ----------------------------- -----------------------------
<S> <C> <C> <C> <C>
Sony Plaza New York, NY 1st Quarter 1995 Sony Corp. Structuretone, Inc.
Bank of China Building Ching Yuan, China 4th Quarter 1995 Bank of China Guangdong Construction
Po Lin Temple Hong Kong 3rd Quarter 1995 Po Lin Temple Hip Hing
Shue Yan College Hong Kong 4th Quarter 1995 Shue Yan College Hip Hing
Progressive Campus Cleveland, OH 3rd Quarter 1995 Progressive Casualty Whiting-Turner Contracting
East and West Insurance Company Company
Rock and Roll Cleveland, OH 4th Quarter 1995 Rock & Roll Hall of Fame Turner Construction
Hall of Fame Museum, Inc.
Arnoff Center for the Cincinnati, OH 4th Quarter 1995 State of Ohio Messer Cargille Associates
Arts Building Commission
Discovery Bay Hong Kong 2nd Quarter 1995 New World Development Hip Hing
IV and V
Bausch & Lomb Rochester, NY 1st Quarter 1996 Bausch & Lomb, Inc. Le Chase Construction, Inc.
Headquarters
MM Dow World Kansas City, MO 2nd Quarter 1996 Marion Merrell Dow, Inc. Turner Construction
Headquarters Company
Li Chit Street Hong Kong 1st Quarter 1995 New World Development Hip Hing
Dongguan New World Dongguan, China 1st Quarter 1996 Dongguan New World Garden & Guangdong Construction
Garden & Club Club Company Ltd.
Ersha Island Guangzhou, China 4th Quarter 1996 Ultra Metro Consultants Ltd. Guangdong Construction
Company Ltd.
Military Hospital Hong Kong 1st Quarter 1997 Architectural Services China Overseas
Department
Boston Courthouse* Boston, MA 1st Quarter 1998 Bechtel Park Tower Realty Clark Construction
Tai Kok Tsui Hong Kong 3rd Quarter 1998 Sino Land Development Ty International Construction
Metro Station* Company Ltd.
</TABLE>
- ---------------
(1) Completion Date means (i) for completed projects, the calendar, as opposed
to fiscal, date on which the Company's employees leave the job site and (ii)
for pending projects, the estimated practical completion date according to
the project contract. Actual completion date may vary from the estimated
practical completion date. See "Risks Factors -- Delays in Completion of
Construction Projects."
STRATEGIC RELATIONSHIPS
The Company has established relationships worldwide with several of the
most respected companies in the construction industry. The Company actively
participates in the architectural design stage of its projects and has excellent
marketing and working relationships with major international architects,
including Skidmore Owings & Merrill, Kohn Pederson & Fox and Pei Cobb. The
Company also has strategic relationships with several of the most respected
international developers and project managers, including Bechtel, New World
Development, Mitsui, Turner Construction and Morse Diesel. These relationships
serve to promote the Company's participation in bidding on desirable projects
and allow the Company to leverage its sophisticated management and technological
expertise with low-cost, localized labor and market knowledge. As a result, the
Company is able to offer a complete range of services, from initial design
through final installation.
Bechtel is one of the largest construction companies in the world and is
playing an active role as construction manager and developer on numerous major
construction projects. The Company has worked with Bechtel on several projects
including the construction of Bechtel's worldwide headquarters in San Francisco,
California and is currently working with Bechtel on the Empire Towers project in
Thailand. See "-- Projects."
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The Company has worked with New World Development on several projects in
Hong Kong and the PRC and intends to build on this relationship in the future.
New World Development is one of the largest real estate developers in Hong Kong
and owns one of the largest land banks in the PRC.
The Company recently established a joint venture with Grupo IMSA for the
fabrication of custom curtain wall in Monterrey, Mexico. Grupo IMSA of Mexico is
a large industrial company involved in the aluminum and construction products
industries. The Company believes that this joint venture will reduce its custom
curtain wall fabrication costs for North American projects and increase its
ability to selectively target and obtain projects throughout Latin America.
COMPETITION
The U.S. and international markets for custom curtain wall construction are
cyclical and dependent on changes in general economic conditions. The curtain
wall industry remains highly competitive with numerous contractors typically
bidding on each available project. The Company encounters competition in the
U.S. and abroad from Benson Industries, Inc., Cupples Products, Glassalum,
Harmon Ltd., a subsidiary of Apogee Enterprises, Inc. and other curtain wall
contractors. The Company's primary competitors in Asia include: Far East
Aluminum Works Co., Ltd., Nippon Light Metals Hong Kong Ltd., Builder's Federal
Hong Kong Ltd., Permasteelisa Holdings Ltd., Tostem Hong Kong Ltd., YKK Hong
Kong Ltd. and Josef Gartner & Co. Ltd. (Hong Kong). The Company regularly faces
competitive bids from one or more of these competitors when bidding for custom
curtain wall contracts. Some of the Company's competitors have greater financial
resources than the Company. Although the level and nature of competition differs
between markets and among products, the Company believes that it competes on the
basis of cost, the quality of its design and workmanship, and on its reputation.
The Company expects its markets to remain highly competitive.
A limited amount of custom curtain wall projects are in development or
under construction at any given time. The Company competes for desirable
projects, financing, subcontractors, and other resources. A significant number
of the Company's projects are obtained through a bidding process, which is
subject to intense competition. There can be no assurance that the Company will
be successful in winning projects or that it will successfully complete future
or existing projects on a profitable basis. See "Risk Factors -- Competition."
BACKLOG
As of November 30, 1997, the Company had over $53.1 million in project
backlog. Project backlog represents revenue anticipated to be recognized in the
future on projects awarded, as evidenced by a letter of intent or contract, but
on which (i) work has not yet been initiated or (ii) work is currently in
progress. The typical duration of a project from commencement to completion
ranges from 18 to 30 months depending upon the size and complexity of a specific
project. At December 31, 1997, the Company had submitted bids on projects with
an aggregate contract value of over $135 million. There can be no assurance that
the Company will be successful in securing any contracts as a result of these
bids or that the Company will recognize as revenue the amounts reflected as
backlog.
CURRENCY RISK MANAGEMENT
Changes in the value of foreign currencies could adversely affect the
Company's financial condition and results of operations. The Company generally
attempts to mitigate foreign exchange risks by entering into contracts providing
for payment in U.S. dollars instead of the local currency where possible, except
for that portion of local currency necessary to pay local labor, raw materials
or other costs of operations, and maintaining reserves for credit losses. See
"Risk Factors -- Foreign Exchange Risks" and "Political and Other
Uncertainties."
BONDING
The Company is dependent upon bonding facilities to obtain custom curtain
wall projects. Domestically, the Company is typically required to provide
payment and performance bonds equal to 100% of the project
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<PAGE> 32
contract value awarded. Internationally, the Company is typically required to
provide performance bonds in the amount of 10% of the contract value.
Additionally, international projects often include a 10% to 20% advance payment
which is payable upon execution of the project contract. In these instances, the
Company is also required to provide an advance payment bond equal to the amount
of the advance payment. While there are a limited number of bonding companies
qualified to provide both international and domestic bonding facilities, a
majority will only provide either domestic or international bonding. Thus, the
Company typically seeks domestic and international bonds from different sources.
The availability and terms of bonding facilities are largely dependent upon the
Company's financial condition and in particular its equity position. If the
Company were unable to secure sufficient bonding facilities required to satisfy
its contractual bonding obligations under existing and future project contracts
it could have a material adverse effect on the Company's business, financial
condition and results of operation. See "Risk Factors -- Need for Additional
Financing; Bonding."
WARRANTIES
The Company typically provides a one to five year material and workmanship
warranty in addition to the pass-through warranties provided by material
suppliers and other vendors on items such as glass and sealant. Historically,
warranty expenses have not had a material impact on the Company's operations or
its financial condition. There can be no assurances that this will continue to
be the case or that disputes over materials or workmanship will not arise in the
future.
EMPLOYEES
As of November 30, 1997, the Company employed approximately 150 people, of
whom approximately 50 were hourly employees and approximately 100 were salaried.
The Company contracts with union labor for curtain wall erection services in the
U.S. The Company considers its relations with its employees to be good. See
"Risk Factors -- Union Relations."
LEGAL PROCEEDINGS
The Company currently and from time to time is involved in litigation in
the ordinary course of its business. The Company does not believe that it is
involved in any litigation, including the proceedings described below, that
will, individually or in the aggregate, have a material adverse effect on its
financial condition, results of operations or cash flow.
During the period FCAM was owned and operated by Armco, FCAM operated
facilities which allegedly generated hazardous substances. Lawsuits involving
these operations have been brought by certain parties, including the U.S.
Environmental Protection Agency ("EPA") and various state agencies, and Armco
and FCAM each have been identified as a potentially responsible party ("PRP") in
connection with certain hazardous waste sites. Pursuant to the terms of the
Armco Sale, Armco agreed to defend, indemnify and hold harmless the Company in
connection with certain lawsuits, including environmental claims associated with
any property owned or operated by, or which constituted a disposal area of,
Armco or FCAM prior to January 1, 1997 (the "Indemnification Agreement"). The
Company believes that to the extent the Company incurs any loss or liability in
connection with any such action, it will be fully compensated therefor pursuant
to the terms of the Indemnification Agreement. No liability has been recorded on
the Company's financial statements with respect to the claims covered thereby.
There can be no assurance, however, that in the event the Company is found
liable under these claims that the indemnities will be sufficient to cover the
Company's liability.
In April 1992, Armco acquired the predecessor to FCAM, E.G. Smith
Construction Products, Inc. ("E.G. Smith"), from Cyclops Corporation. E.G. Smith
formerly operated a facility in Cambridge, Ohio which generated hazardous waste.
On March 28, 1996, the EPA filed a complaint in the U.S. District Court for the
Southern District of Ohio alleging failure to comply with a Consent Agreement
and Final Order under federal law. The complaint seeks civil penalties of up to
$25,000 per day for each violation of federal law. The
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<PAGE> 33
Indemnification Agreement provides that Armco will defend, indemnify and hold
harmless the Company for any damages, fines or penalties in connection with this
matter.
In December 1991, E.G. Smith was identified as a PRP for the generation of
hazardous waste located at the Fultz Landfill Superfund site in Byesville, Ohio.
In July 1995, the EPA filed a complaint in U.S. District Court for the Southern
District of Ohio seeking reimbursement for response actions and response work.
The complaint seeks an unspecified amount of damages. The Indemnification
Agreement provides that Armco will defend, indemnify and hold harmless the
Company for any damages, fines or penalties in connection with this matter.
In January 1994, E.G. Smith and Armco were served with a request for
information in connection with an enforcement action for the cleanup of
hazardous waste at a facility located in Granville, Ohio. E.G. Smith and Armco
were each identified as a PRP in connection with this proceeding. The
Indemnification Agreement provides that Armco will defend, indemnify and hold
harmless the Company for any damages, fines, or penalties in connection with
this matter.
On February 28, 1993, FCAM filed a lawsuit in the Supreme Court of the
State of New York against Sky Lift Corporation ("Skylift") after Skylift
allegedly refused to complete work at a job site and abandoned the project.
Skylift filed a counterclaim seeking $1.7 million plus interest, alleging the
right to compensation for extra work, breach of contract, and other theories of
recovery.
PROPERTIES
The Company leases approximately 15,000 square feet of space in Johnson
City, Tennessee, which includes its corporate headquarters and engineering
facilities. The lease expires on December 31, 2002. The Company leases 41,000
square feet of space in Piney Flats, Tennessee which is used for fabrication.
The lease expires on May 30, 1998. The Company leases 2,500 square feet of
office space in Jericho, New York. The lease expires on May 31, 2002. The
Company has a 45% interest in a fabrication facility located in Monterrey,
Mexico, which is a joint venture with Grupo IMSA, S.A. de C.V. The Company has a
30% interest in a fabrication facility located in Foshan, PRC.
The Company also leases 2,000 square feet of space in Hong Kong which is
the principal executive and administrative office for Asia and is used by the
accounting, purchasing, design departments and by project managers. The lease
expires in January 1999. The Company leases 1,400 square feet of office space in
Hong Kong which is used by the design and engineering departments. The lease
expires in January 1999. The Company leases 2,900 square feet of space in
Bangkok, Thailand which is used as an administrative office. The lease expires
in January 1998. The Company leases 3,300 square feet of space in Bangkok,
Thailand which serves as a warehouse. The lease expires in March 1998.
The Company intends to use a portion of the proceeds from the Offering to
establish or acquire a modern fabrication facility in the PRC to meet the
demands of the Asian market for quality curtain wall systems and to satisfy
anticipated future capacity demands. See "Use of Proceeds."
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<PAGE> 34
MANAGEMENT
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information concerning the
directors, executive officers and certain other significant employees of the
Company.
<TABLE>
<CAPTION>
NAME AGE POSITION
-------------------------------- --- ------------------------------------------------
<S> <C> <C>
John W.Y. Tang.................. 45 Chairman of the Board and Secretary
Michael J. Russo................ 37 President, Chief Executive Officer and Director
Bryan R. Willis................. 32 Chief Financial Officer
Roger Ulbricht.................. 57 Vice President Business Development and
Technical Service
John M. Sonnenburg.............. 44 Vice President Operations
Michael Kaisersatt.............. 40 Vice President Purchasing and Estimating
Michael Logan................... 55 National Sales Manager
Johnson K. Fong................. 38 Director
</TABLE>
John W. Y. Tang has been the Chairman of the Board of Directors and
Secretary of the Company since January 1997 and has over 10 years in the custom
curtain wall industry. From 1992 to 1997, he was a director of FCAM Asia. From
1990 to 1992, he was a Senior Structural Engineer with Ove Arup & Partners, a
U.K.-based engineering consulting firm. Between 1987 and 1990 he was the
managing director of Brinkley Holding Co., Ltd. a property development company
doing business in Canada. Mr. Tang is a registered professional engineer in
California and the U.S., a registered professional engineer in the Province of
Alberta, Canada, a chartered engineer in the United Kingdom, and a member of the
Institution of Structural Engineers in the United Kingdom. He received his
Masters Degree in Civil Engineering from the University of California at
Berkeley.
Michael J. Russo has been the President and Chief Executive Officer and a
Director of the Company since January 1997 and has over 12 years in the custom
curtain wall industry. Between 1994 and 1997, Mr. Russo served as the President
and Chief Executive Officer of FCAM. From 1991 to 1994, he was the Vice
President of Sales and Marketing of FCAM. Mr. Russo received a Bachelor's Degree
in Mass Communications from Lycoming College.
Bryan R. Willis has been the Chief Financial Officer of the Company since
January 1997. From 1995 to 1997, he was Division Controller of FCAM. Prior to
that, and between 1994 and 1995 he was Supervisor of Financial Planning and
Analysis of Armco Inc. From 1992 to 1994 he was a Financial Analyst for the
Chrysler Corporation. Mr. Willis received a Bachelor's Degree from Southern Utah
University and a Masters Degree in Business Administration from Brigham Young
University.
Roger Ulbricht has been the Vice President of Business and Technical
Services of the Company since January 1997. From 1980 to 1997, he served as Vice
President of Engineering for FCAM and has over 35 years of work experience with
FCAM.
John Sonnenburg has been the Vice President of Operations since January
1997 and has over 20 years in the custom curtain wall industry. From 1995 to
1997, he served as Vice President of Operations for FCAM. From 1992 to 1995, he
was Vice President of Operations for Apex Curtainwalls. He is also a registered
professional engineer in Texas, Louisiana and Tennessee. Mr. Sonnenburg received
a Bachelor's Degree in Civil Engineering from Purdue University.
Michael Kaisersatt has been the Vice President of Purchasing and Estimating
since January 1997 and has over 15 years in the custom curtain wall industry.
From 1995 to 1997 he was the Vice President of Purchasing and Estimating of
FCAM. From 1989 to 1995 he was the Manager of the Glass Department of FCAM.
Michael Logan has been the National Sales Manager of the Company since July
1997 and has over 25 years of experience in the custom curtain wall industry.
From January to July 1997, he was Manager of
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<PAGE> 35
Business Development of the Company. From 1994 to 1996, he was Regional Sales
Manager for FCAM. From 1992 to 1994, Mr. Logan was Vice President of Sales of
Frame Engineering, a privately held curtain wall company.
Johnson K. Fong became a Director of the Company in January 1997. Mr. Fong
has been a partner of the accounting and consulting firm of Anderson & Schwartz
McGuire LLP since 1988. He is a licensed Certified Public Accountant and member
of the American Institute of Certified Public Accountants, California Society of
Certified Public Accountants and the Hong Kong Society of Accountants. Mr. Fong
received a Bachelor's Degree from the University of California at Berkeley.
The officers of the Company serve at the discretion of the Board. Each
director of the Company serves until such director's successor is elected and
qualified or until the director's death, retirement, resignation or removal.
The Company intends to appoint two additional independent directors to its
Board of Directors within three months of the consummation of the Offering.
Directors who are also employees of the Company or one of its subsidiaries will
not receive additional compensation for serving as directors. Each director who
is not an employee of the Company or one of its subsidiaries are paid $5,000 per
year, plus $500 for each Board of Directors' meeting and each committee meeting
they attend (unless a committee meeting is held on the same day as a Board of
Directors' meeting), reimbursement for out-of-pocket expenses incurred in
attending Board and committee meetings and stock options. See
"Management -- Stock Option Plan."
COMMITTEES OF THE BOARD OF DIRECTORS
Audit Committee. Following the Offering, the Board of Directors intends to
establish an audit committee (the "Audit Committee") to make recommendations to
management concerning the engagement of independent public accountants, review
with the independent public accountants the plans and results of the audit
engagement, approve professional services provided by the independent public
accountants, review independence of the independent public accountants, consider
the range of audit and non-audit fees and review the adequacy of the Company's
internal accounting controls.
Compensation Committee. Following the Offering, the Board of Directors
intends to establish a compensation committee (the "Compensation Committee") to
determine compensation of the Company's executive officers and to administer the
Company's 1997 Stock Incentive Plan (the "Plan"). The current executive officer
salaries were set by the Board.
EXECUTIVE COMPENSATION
The following table sets forth certain summary information concerning the
compensation paid by the Company to the Company's Chief Executive Officer in
fiscal 1997 (the "Named Executive Officer"). During fiscal 1997, the Company had
no other executive officers whose salary exceeded $100,000. The compensation
numbers below reflect compensation paid by the Company after the consummation of
the Armco Sale and do not reflect compensation paid to Mr. Russo by Armco in
connection with his services to FCAM prior to the Armco Sale.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION
------------------- OTHER ANNUAL
NAME AND PRINCIPAL POSITION(S) SALARY BONUS COMPENSATION
- ----------------------------------------------------------- -------- ------ ------------
<S> <C> <C> <C>
Michael J. Russo........................................... $108,334 $ -- $8,000
President, Chief Executive Officer
and Director
</TABLE>
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<PAGE> 36
EMPLOYMENT AGREEMENTS
Messrs. Tang, Russo, Willis and Ulbricht have entered into employment
agreements with the Company providing for an annual base salary of $160,000,
$130,000, $100,000 and $105,000, respectively. Each employment agreement is for
a term of five years commencing on January 1, 1997, with the exception of Mr.
Tang's which commences on December 15, 1997. Each of these agreements provides
that, in the event of a termination of employment by the Company without cause,
the employee will be entitled to receive his then current salary and benefits
for a period of six months following date of termination and shall be entitled
to retain all of his Purchase Shares (as defined below) that have vested prior
to the effective date of termination. Each employment agreement contains a
covenant not to compete with the Company and not to solicit business away from
the Company during the term of employment and for one year thereafter. If the
Company undergoes a "change in control," then, under certain circumstances, the
Company may terminate its Repurchase Rights (as defined below) in their entirety
as of the date of the "change in control."
Each employment agreement, other than Mr. Tang's, provides for a stock
purchase right ("Stock Purchase Right") with respect to shares of Common Stock
of the Company in conjunction with a vesting schedule therefor which restricts
any transfers or dispositions of such shares ("Purchase Shares"). Pursuant to
the employment agreements, Messrs. Russo, Willis and UIbricht have exercised
their Stock Purchase Rights and purchased 199,862, 159,890 and 39,972 shares of
Common Stock of the Company, respectively, at an exercise price of $0.000143 per
share. Subject to continued employment by the Company, such shares vest five
years after date of grant and have provisions for accelerated vesting if certain
earnings targets are met. Upon termination of employment, the Company may
repurchase any unvested shares at the exercise price of $0.000143 per share.
STOCK INCENTIVE PLAN
In December 1997, the Company and its stockholders adopted the Company's
1997 Stock Incentive Plan (the "Plan"). The Plan provides a means to attract,
motivate, retain and reward key employees, directors and consultants of the
Company and its subsidiaries and promote the success of the Company. The Plan
provides that the maximum number of shares of Common Stock that may be issued
pursuant to outstanding grants and awards and are available for future grants
and awards under the Plan shall be equal to 500,000 shares plus 10% of any
increase in outstanding shares that occur after December 15, 1997. The maximum
number of shares that may be subject to all awards granted to any individual in
any calendar year is limited to 100,000 shares.
Administration and Eligibility. The Plan provides that it will be
administered by the Board of Directors or a committee appointed by the Board of
Directors. The Board of Directors intends to appoint the Company's Compensation
Committee to administer the Plan after the Offering. The Plan empowers the
Compensation Committee, among other things, to interpret the Plan, to make all
determinations deemed necessary or advisable for the administration of the Plan
and to award to officers and other key employees, directors and consultants of
the Company and its subsidiaries ("Eligible Employees"), as selected by the
Compensation Committee, options, including incentive stock options ("ISOs") as
defined in the Code, stock appreciation rights ("SARs"), shares of restricted
stock, performance shares and other awards valued by reference to Common Stock,
based on the performance of the participant, the performance of the Company or
its Common Stock and/or such other factors as the Compensation Committee deems
appropriate.
Transferability. Generally speaking, options under the Plan are not
transferable other than by will or the laws of descent and distribution, are
exercisable only by the participant, and may be paid only to the participant or
the participant's beneficiary or representatives. However, the Compensation
Committee may establish conditions and procedures under which exercise by and
transfers and payments to certain third parties are permitted, to the extent
permitted by law.
Payment. The Plan permits optionees, with certain exceptions, to pay the
exercise price of options in cash, Common Stock (valued at its fair market value
on the date of exercise), a combination thereof or, if an option award so
provides, by delivering irrevocable instructions to a stockbroker to promptly
deliver the exercise price to the Company upon exercise (i.e., a so-called
"cashless exercise"). Cash received by the
35
<PAGE> 37
Company upon exercise will constitute general funds of the Company and shares of
Common Stock received by the Company upon exercise will return to the status of
authorized but unissued shares.
Term and Exercise Period of Options. The Plan provides that options may be
granted for such terms as the Compensation Committee may determine but not
greater than ten years after the date of the Option. The Plan does not impose
any minimum vesting period, post-termination exercise period or pricing
requirement, although in the ordinary course, customary restrictions will likely
be imposed. Options will generally be exercisable during the holder's employment
by the Company or by a related company. Generally speaking, options which have
become exercisable prior to termination of employment will remain exercisable
for ninety days thereafter (180 days in the case of disability or death). Such
periods, however, cannot exceed the expiration dates of the Options. The
Committee has the authority to accelerate the exercisability of Options or
(within the maximum ten-year term) extend the exercisability periods.
Non-employee Directors. Under the Plan, each director who is not an
employee (a "Non-Employee Director") will be granted stock options to purchase
20,000 shares of Common Stock upon becoming a director at an exercise price
equal to the market price of the Common Stock on that date. Non-Employee
Directors on the date of the Offering will each be granted stock options to
purchase 20,000 shares of Common Stock on the date of the Offering at the public
offering price. In addition, at the close of trading on the day of the annual
stockholders meeting in each calendar year beginning in the fourth year
following the initial grant, each Non-Employee Director on such date will be
granted stock options to purchase 5,000 shares of Common Stock at an exercise
price equal to the market price of the Common Stock on that date. All
Non-Employee Director options have a 10-year term and will vest in equal annual
installments over a four-year period commencing on the first anniversary of the
grant date. If a Non-Employee Director's services are terminated for any reason
other than the director's death, disability or retirement, any portion of stock
options held by such director that are exercisable will remain exercisable for
three months after such termination of services or until the expiration of the
term of such option, whichever occurs first. If the Non-Employee Director dies,
becomes disabled or retires, stock options held by such director will become
exercisable immediately and remain exercisable for one year after the date of
such termination of services or until the expiration of the term of such option,
whichever first occurs.
Termination, Amendment and Adjustment. The Plan may be terminated by the
Compensation Committee or by the Board of Directors at any time. In addition,
the Compensation Committee or the Board may amend the Plan from time to time,
without the authorization or approval of the Company's stockholders, unless that
approval is required by law, agreement or the rules of any exchange upon which
the stock of the Company is listed. No Option may be granted under the Plan
after December 14, 2007, although options previously granted may thereafter be
amended consistent with the terms of the Plan.
Upon the occurrence of a Change in Control Event (as defined in the Plan),
in addition to acceleration of vesting, an appropriate adjustment to the number
and type of shares or other securities or property subject to an option and the
price thereof may be made in order to prevent dilution or enlargement of rights
under options.
Individual awards may be amended by the Compensation Committee in any
manner consistent with the Plan, including amendments that effectively reprice
options without changes to other terms. Amendments that adversely affect the
holder of an option, however, are subject to his or her consent.
The Plan is not exclusive and does not limit the authority of the Board of
Directors or the Compensation Committee to grant other awards, in stock or cash,
or to authorize other compensation, under any other plan or authority.
Compensation Committee Interlocks and Insider Participation
Prior to the Offering, the Company had no compensation committee or other
committee of the Board performing similar functions. Decisions concerning
compensation of executive officers were made by the Company's Board. No officer
or employee of the Company, other than Mr. Tang and Mr. Russo, participated in
deliberations concerning such compensation matters.
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<PAGE> 38
CERTAIN TRANSACTIONS
Between March and October 1997, the Chairman of the Board, Mr. Tang loaned
a total of $84,616 to FCAM Asia. There is no maturity date for the loan, it
bears interest at a rate of 10% per annum and is not evidenced by a written
instrument. In the same period, FCAM Asia advanced $64,103 to Mr. Tang, retired
$20,513 of indebtedness to Mr. Tang and made an interest payment in the amount
of $1,792 to Mr. Tang.
Between March and October 1997, Ng Ching Ching Rowena, wife of Mr. Tang,
loaned $208,975 to FCAM Asia. There is no maturity date for the loan, it bears
interest at a rate of 10% per annum and is not evidenced by a written
instrument. In the same period, FCAM Asia made an interest payment in the amount
of $6,774 to Ms. Ng.
The loans to FCAM Asia by Mr. Tang and Ms. Ng were used to supplement cash
flow since much of FCAM Asia's cash was used to secure banking facilities in
connection with certain projects including the Empire Towers project. As of
November 29, 1997, FCAM Asia's indebtedness to Ms. Ng stood at $260,145. As of
the same date, Mr. Tang was indebted to FCAM Asia in the amount of $49,947.
In connection with the FCAM Pacific Acquisition in January 1997, FCI issued
1,142,857 shares to the FCAM Pacific stockholders in exchange for 100% of the
issued and outstanding shares of FCAM Pacific. As a result of the FCAM Pacific
Acquisition, Mr. John Tang received 719,503 shares of common stock of FCI.
37
<PAGE> 39
PRINCIPAL STOCKHOLDERS
The following table sets forth information regarding beneficial ownership
of the Common Stock as of January 5, 1998 by (i) each person who is known to the
Company to beneficially own more than 5% of the outstanding shares of Common
Stock, (ii) each director of the Company, (iii) the Named Executive Officer, and
(iv) all directors and executive officers of the Company as a group.
<TABLE>
<CAPTION>
PERCENTAGE
SHARES ----------------------
BENEFICIALLY BEFORE AFTER
NAME OF BENEFICIAL OWNER(1) OWNED OFFERING OFFERING
- ------------------------------------------------------- ------------ ------- --------
<S> <C> <C> <C>
John W.Y. Tang(2)...................................... 2,638,365 62.0% 41.5%
Michael J. Russo....................................... 199,862 4.7 3.1
Johnson Fong........................................... -- -- --
Cynthia Lam............................................ 479,669 11.3 7.5
Gold Manor Ltd.
P.O. Box 957
Offshore Corporations Centre
Road Town
Tortola, British Virgin Islands
Mak Yim Hung
Dynamic Choice Enterprises, Inc...................... 479,669 11.3 7.5
Wickams Cay
Road Town
Tortola, British Virgin Islands
All officers and directors as a group
(4 persons).......................................... 3,038,088 66.7% 45.3%
</TABLE>
- ---------------
(1) Unless otherwise indicated, all persons listed have an address c/o the
Company's principal executive offices and have sole voting and investment
power with respect to their shares of Common Stock, except to the extent
authority is shared by spouses under applicable law.
(2) Includes 1,918,674 shares held by Wilson International Ltd., a British
Virgin Islands corporation, of which Mr. Tang is the sole beneficial owner.
38
<PAGE> 40
DESCRIPTION OF CAPITAL STOCK
The following summary description of the capital stock of the Company is
qualified in its entirety by reference to the Company's Articles of
Incorporation and Articles of Merger (the "Articles") and by the provisions of
applicable law. A copy of the Articles is included as an exhibit to the
Registration Statement of which this Prospectus is a part.
The Company's authorized capital stock consists of 50,000,000 shares of
Common Stock, par value $0.0001 per share (the "Common Stock"), and 5,000,000
shares of Preferred Stock with a par value of $0.0001 per share (the "Preferred
Stock"). Upon completion of the Offering, the Company will have outstanding
6,252,381 shares of Common Stock (6,552,381 shares if the Underwriter's
Over-Allotment Option is exercised in full) and no shares of Preferred Stock.
All of the currently issued and outstanding shares of Common Stock are validly
issued, fully paid and nonassessable under the Nevada Revised Statutes ("NRS").
COMMON STOCK
Holders of Common Stock are entitled to one vote for each share held on all
matters submitted to a vote of stockholders. There is no cumulative voting.
Holders of Common Stock are entitled to receive ratably any dividends that may
be declared by the Board of Directors of the Company out of legally available
funds. Upon the liquidation, dissolution or winding up of the Company, the
holders of Common Stock are entitled to receive ratably the net assets of the
Company after payment of all debts and liabilities and liquidation preferences
of any outstanding shares of Preferred Stock. Holders of Common Stock have no
preemptive, subscription, redemption or conversion rights.
PREFERRED STOCK
Shares of unissued Preferred Stock may be issued in one or more series from
time to time with such designations, rights, preferences and limitations as the
Board of Directors may determine. The rights, preferences and limitations of
separate series of Preferred Stock may differ with respect to such matters as
may be determined by the Board of Directors including without limitation, the
rate of dividends, method or nature of payment of dividends, terms of
redemption, amounts payable on liquidation, sinking fund provisions, conversion
rights and voting rights. Such undesignated shares could also be used as an
anti-takeover device by the Company. For example, they could be issued with
"super-voting rights" and placed in the control of parties friendly to the
current management.
CERTAIN PROVISIONS OF NEVADA LAW
The Company is a Nevada corporation and is subject to certain anti-takeover
provisions of the Nevada Revised Statutes ("NRS").
Nevada "Combination with Interested Stockholders Statute." NRS Sections
78.411 through 78.444 (the "Combination with Interested Stockholders Statute")
prohibit an "interested stockholder," under certain circumstances, from entering
into a "combination" with a Nevada corporation, unless certain conditions are
met. A "combination" includes (a) any merger with an "interested stockholder,"
or any other corporation which is or after the merger would be, an affiliate or
associate of the interested stockholder, (b) certain sales, leases, exchanges,
mortgages, pledges, transfers or other dispositions of assets, in one
transaction or a series of transactions, to or with an "interested stockholder,"
(c) any issuance or transfer of shares of the corporation or its subsidiaries,
to the "interested stockholder," having an aggregate market value equal to 5% or
more of the aggregate market value of all the outstanding shares of the
corporation, (d) the adoption of any plan or proposal or the liquidation or
dissolution of the corporation proposed by the "interested stockholder," (e)
certain transactions which would result in increasing the proportionate share of
shares of the corporation owned by the "interested stockholder," or (f) the
receipt of benefits by an interested stockholder, except proportionately as a
stockholder, of any loans, advances or other financial benefits provided by the
corporation. An "interested stockholder" is a person who, together with
affiliates and associates, beneficially owns (or within the prior three years,
did beneficially own) 10% or more of the corporation's voting stock. A
corporation
39
<PAGE> 41
to which the statute applies may not engage in a "combination" within three
years after the interested stockholder acquired its shares, unless the
combination or the interested stockholder's acquisition of shares was approved
by the board of directors before the interested stockholder acquired the shares.
Generally, the combination may be consummated after the three-year period
expires if either (i) the board of directors of the corporation approved, prior
to such person becoming an interested stockholder, the combination or the
purchase of shares by the interested stockholder or (ii) the combination is
approved by the affirmative vote of holders of a majority of voting power not
beneficially owned by the interested stockholder at a meeting called no earlier
than three years after the date the interested stockholder became an interested
director.
Nevada "Control Share Acquisition Statute." NRS Sections 78.378 through
78.3793 (the "Control Share Acquisition Statute") prohibit an acquirer, under
certain circumstances, from voting shares of a target corporation's stock after
crossing certain threshold ownership percentages, unless the acquire obtains the
approval of the target corporation's stockholders. The Control Share Acquisition
Statute only applies to Nevada corporations that do business directly or
indirectly in Nevada. The Company does not intend to "do business" in Nevada
within the meaning of the Control Share Acquisition Statute. Therefore, it is
unlikely that the Control Share Acquisition Statute will apply to the Company.
LIMITATION OF LIABILITY
The NRS provides that a Nevada corporation may include in its articles of
incorporation a provision indemnifying officer, directors, employees and agents
against expenses including attorney's fees, judgments, fines, and amounts paid
in settlement actually and reasonably incurred by such person in connection with
the suit, action or proceeding if such person acted in good faith and in a
manner he or she reasonably believed to be in the best interests of the
corporation and with respect to any criminal action or proceeding had no
reasonable basis to conclude that his or her conduct was unlawful. A Nevada
corporation may also indemnify any person who was or is a party or is threatened
to be made a party to any threatened, pending, or completed action or suit by
reason of the fact that such a person was an officer, director, employee or
agent of the corporation if such person acted in good faith and in a manner
which he or she believed to be in the best interests of the corporation.
To the fullest extent allowable under NRS, the Company's Articles and
Bylaws provide that the Company shall indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending, or completed
action or suit whether criminal, civil, administrative or investigative, by
reason of the fact that such a person, his testator or intestate was an officer,
director, of the corporation, or a predecessor of the corporation.
TRANSFER AGENT OR REGISTRAR
The Transfer Agent and Registrar for the Common Stock is Jersey Transfer
and Trust Company, Verona, New Jersey.
SHARES ELIGIBLE FOR FUTURE SALE
Upon completion of the Offering 6,252,381 shares of Common Stock of the
Company will be outstanding (6,552,381 shares upon exercise of the Underwriters'
Over-Allotment Option). Of these shares, 2,255,143 will be available for
unrestricted trading in the public market. None of the remaining outstanding
shares of Common Stock will have been registered under the Securities Act, which
means that they may be resold publicly only upon registration under the
Securities Act or in compliance with an exemption from the registration
requirements of the Securities Act, including the exemption provided by Rule 144
thereunder.
In general, under Rule 144, if a period of at least one year has elapsed
between the later of the date on which restricted securities were acquired from
the Company or the date on which they were acquired from an affiliate, the
holder of such restricted securities (including an affiliate) is entitled to
sell a number of shares within any three-month period that does not exceed the
greater of (i) 1% of the then outstanding shares of the Common Stock
(approximately 62,524 shares) or (ii) the average weekly reported volume of
trading of the
40
<PAGE> 42
Common Stock during the four calendar weeks preceding such sale. Sales under
Rule 144 are also subject to certain requirements pertaining to the manner of
such sales, notices of such sales and the availability of current public
information concerning the Company. Affiliates may sell shares not constituting
restricted securities in accordance with the foregoing volume limitations and
other requirements but without regard to any holding period. Under Rule 144(k),
if a period of at least two years has elapsed between the later of the date on
which restricted securities were acquired from the Company and the date on which
they were acquired from an affiliate, a holder of such restricted securities who
is not an affiliate at the time of the sale and has not been an affiliate for at
least three months prior to the sale is entitled to sell the shares immediately
without regard to volume limitations and other conditions described above.
The Company has reserved 500,000 shares of Common Stock for issuance under
the Plan. Upon consummation of the Offering, the Company intends to grant
options to purchase 200,000 shares of Common Stock under the Plan to employees
and directors of the Company at an exercise price per share equal to the initial
public offering price on the cover hereof. In addition, in connection with this
Offering, the Company is issuing to the Representatives a warrant to purchase a
number of shares of Common Stock equal to 10% of the shares sold in this
Offering (the "Underwriters"). The Company intends (and in the case of the
Underwriter Warrant, is obligated) to file registration statements under the
Securities Act to register the shares subject to such options and warrant and,
upon effectiveness thereof, such shares will be freely tradeable in the open
market (subject to Rule 144 limitations applicable to affiliates).
The Company and its officers, directors and certain stockholders, who
beneficially own at least 62,524 shares of Common Stock in the aggregate, have
agreed not to sell or otherwise dispose of any shares of Common Stock for a
period of 180 days from the date of this Prospectus without the prior written
consent of the Representative, except that the Company may issue shares of
Common Stock offered hereby, shares of Common Stock issued pursuant to the
exercise of outstanding options and warrants, shares of Common Stock issued
(subject to certain conditions) in connection with acquisitions and options
granted under the Company's stock option plans, so long as none of such options
become exercisable during such period.
No prediction can be made as to the effect, if any, the sale of shares or
the availability of shares for sale will have on the market price for the Common
Stock prevailing from time to time. Nevertheless, sales, or the availability for
sale of, substantial amounts of the Common Stock in the public market could
adversely affect prevailing market prices and the future ability of the Company
to raise equity capital and complete acquisitions for Common Stock.
41
<PAGE> 43
UNDERWRITING
Subject to the terms and conditions of the Underwriting Agreement, the
underwriters named below (the "Underwriters"), through their representative, Van
Kasper & Company (the "Representative"), have severally agreed to purchase from
the Company the number of shares of Common Stock set forth opposite their names
below:
<TABLE>
<CAPTION>
UNDERWRITERS NUMBER OF SHARES
------------ ----------------
<S> <C>
Van Kasper & Company......................................
---------
Total........................................... 2,000,000
=========
</TABLE>
The Underwriting Agreement provides that the obligations of the
Underwriters are subject to certain conditions precedent and that the
Underwriters will purchase all of the shares of Common Stock offered hereby
(other than those subject to the Underwriters' Over-Allotment Option described
below) if any are purchased.
The Underwriters propose to offer the shares of Common Stock directly to
the public at the price to public set forth on the cover page of this Prospectus
and to certain dealers at this price less a concession not in excess of
$ per share. The Underwriters may allot and these dealers may reallot a
concession not in excess of $ per share to certain other dealers. After
the initial offering, the offering price and other selling terms may be changed
by the Representative.
Prior to this offering, there has been no active public market for the
Common Stock. Consequently, the initial public offering price will be determined
through negotiation among the Company and the Representative. Factors to be
considered in making such determination include the prevailing market
conditions, the Company's financial and operating history and condition, its
prospects and the market prices of securities for companies in businesses
similar to that of the Company.
The Company has granted to the Underwriters an option (the "Over-Allotment
Option"), exercisable no later than 45 days after the date of this Prospectus,
to purchase up to 300,000 additional shares of Common Stock at the initial
public offering price, less the Underwriting Discounts and Commissions set forth
on the cover page of this Prospectus, solely to cover over-allotments. To the
extent that the Representative acts to exercise Over-Allotment Option, each of
the Underwriters will have a firm commitment to purchase approximately the same
percentage thereof as the number of shares of Common Stock to be purchased by it
shown in the above table bears to the total offering, and the Company will be
obligated, pursuant to the option, to sell such shares of Common Stock to the
Underwriters.
In connection with the offering made hereby, the Company has agreed to sell
to the Representative, for nominal consideration, the Representative's Warrant,
which entitles the Representative to purchase from the Company a number of
shares of Common Stock, equal to 10% of the number of shares sold in this
Offering. The Representative's Warrant is exercisable, in whole or in part, at
an exercise price of 120% of the initial public offering price at any time
during the four-year period commencing one year after the date of issuance
(which will be on or after the effective date of the Registration Statement of
which this Prospectus is a part), and cannot be transferred for a period of one
year from the date of issuance except to the Underwriters, selling group members
and their officers or partners. The warrant agreement pursuant to which the
Representative's
42
<PAGE> 44
Warrant will be issued will contain provisions providing for adjustment of the
exercise price and the number and type of securities issuable upon exercise of
the Representative's Warrant should any one or more of certain specified events
occur. The Representative's Warrant grants to the holders thereof certain rights
of registration for the securities issuable upon exercise thereof.
At the closing of the Offering, the Company will also pay to the
Representative a non-accountable expense allowance equal to 1.5% of the total
price to public of the shares sold in the Offering.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act. The Representative
has informed the Company that the Underwriters do not intend to confirm sales to
accounts over which they exercise discretionary authority.
In connection with the Offering, the Representative may engage in certain
transactions that stabilize the price of the Common Stock. Such transactions
consist of bids or purchases for the purchases for the purpose of pegging,
fixing or maintaining the price of the Common Stock.
If the Underwriters create a short position in the Common Stock in
connection with the Offering, the Representative may reduce that short position
by purchasing Common Stock in the open market. The Representative may also elect
to reduce any short position by exercising all or part of the Over-Allotment
Option. In general, purchases of a security for the purpose of stabilization or
to reduce a short position could cause the price of the security to be higher
than it might be in the absence of such purchases.
Neither the Company nor any of the Underwriters makes any representation or
prediction as to the direction or magnitude of any effect that the transactions
described above may have on the price of the Common Stock. In addition, neither
the Company nor any of the Underwriters makes any representation that the
underwriters will engage in such transaction or that such transactions, once
commenced, will not be discontinued without notice.
The Company, all of its executive officers and directors, and certain
beneficial owners of the Common Stock have agreed not to, directly or
indirectly, offer to sell, contract to sell, sell or otherwise dispose of any
shares of Common Stock or any securities convertible into or exercisable for
shares of Common Stock or any rights to purchase or acquire Common Stock for the
180-day period after the closing of this offering without the prior written
consent of Van Kasper & Company. Van Kasper & Company may, in its sole
discretion and at any time without notice, release all or any portion of the
securities subject to these lock-up agreements. In addition, the Company has
agreed that for a period of 180 days after the date of this Prospectus, it will
not, without the prior written consent of Van Kasper & Company, issue, offer,
sell, grant options to purchase or otherwise dispose of any equity securities or
securities convertible into or exchangeable for equity securities except for
shares of Common Stock offered hereby, shares of Common Stock issued pursuant to
the exercise of outstanding options and warrants and options granted under the
Company's existing stock option plans so long as none of such options become
exercisable during said 180-day period. Sales of such shares in the future could
adversely affect the market price of the Common Stock. See "Shares Eligible for
Future Sale."
LEGAL MATTERS
The validity of the Common Stock offered hereby will be passed upon for the
Company by Manning Marder & Wolfe, Los Angeles, California. Certain legal
matters related to the Offering will be passed on for the Underwriters by
Preston Gates & Ellis LLP, Seattle, Washington.
EXPERTS
The consolidated financial statements and related financial statement
schedule of Flour City Architectural Metals (Pacific) Limited as of and for each
of the two years in the period ending October 31, 1996 included elsewhere in
this Prospectus and elsewhere in the registration statement have been audited by
Deloitte Touche Tohmatsu, independent auditors, as stated in their reports
appearing herein and elsewhere in the registration statement and are included in
reliance upon the reports of such firm given upon their authority as experts in
accounting and auditing.
43
<PAGE> 45
The consolidated financial statements and related financial statement
schedule of Flour City International, Inc. as of and for the year ended October
31, 1997 included elsewhere in this Prospectus and elsewhere in the registration
statement have been audited by Deloitte & Touche LLP, independent auditors as
stated in their report appearing herein and elsewhere in the registration
statement, and are included in reliance upon the reports of such firm given upon
their authority as experts in accounting and auditing.
The financial statements of Flour City Architectural Metals, Inc. as of and
for each of the two years in the period ending December 31, 1996, included
elsewhere in this Prospectus and elsewhere in this registration statement have
been audited by Deloitte & Touche LLP, independent auditors, as stated in their
report appearing herein and elsewhere in the registration statement, and are
included in reliance upon the report of such firm given their authority as
experts in accounting and auditing.
ADDITIONAL INFORMATION
The Company has filed with the Commission a registration statement (which
term shall encompass any and all amendments thereto) on Form S-1 (the
"Registration Statement") under the Securities Act with respect to the shares of
Common Stock offered by this Prospectus. This Prospectus, which is part of the
Registration Statement, does not contain all of the information set forth in the
Registration Statement and the exhibits and schedules thereto, certain items of
which are omitted in accordance with the rules and regulations of the SEC.
Statements made in this Prospectus as to the contents of any contract, agreement
or other document referred to are not necessarily complete. With respect to each
such contract, agreement or other document filed as an exhibit to the
Registration Statement, reference is hereby made to the exhibit for a more
complete description of the matter involved, and each such statement shall be
deemed qualified in its entirety by such reference. For further information with
respect to the Company, reference is hereby made to the Registration Statement
and such exhibits and schedules filed as a part thereof, which may be inspected,
without charge, at the Public Reference Section of the SEC at Room 1024,
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the
regional offices of the SEC located at Seven World Trade Center, 13th Floor, New
York, New York 10048 and at Northwestern Atrium Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661. The SEC maintains a web site that contains
reports, proxy and information statements regarding registrants that file
electronically with the SEC. The address of this web site is
(http://www.sec.gov). Copies of all or any portion of the Registration Statement
may be obtained from the Public Reference Section of the SEC, upon payment of
the prescribed fees.
44
<PAGE> 46
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PAGE
----------
<S> <C>
Flour City International Inc. and predecessor
Flour City Architectural Metals (Pacific) Limited
Independent Auditors' Report.................................................. F-2
Independent Auditors' Report.................................................. F-3
Consolidated Balance Sheets................................................... F-4
Consolidated Statements of Income............................................. F-5
Consolidated Statements of Shareholders' Equity............................... F-6
Consolidated Statements of Cash Flows......................................... F-7
Notes to Consolidated Financial Statements.................................... F-8
Flour City Architectural Metals, Inc.
Independent Auditors' Report.................................................. F-18
Balance Sheets................................................................ F-19
Statements of Operations...................................................... F-20
Statements of Stockholders' Deficit........................................... F-21
Statements of Cash Flows...................................................... F-22
Notes to Financial Statements................................................. F-23
Unaudited pro forma financial information
Introduction to Unaudited Pro Forma Financial Information..................... F-26
Unaudited Pro Forma Statement of Income....................................... F-27
Notes to the Unaudited Pro Forma Statements of Income......................... F-28
</TABLE>
F-1
<PAGE> 47
INDEPENDENT AUDITORS' REPORT
To the Shareholders and Board of Directors of
Flour City International, Inc.:
We have audited the accompanying consolidated balance sheet of Flour City
International, Inc. (the "Company") as of October 31, 1997, and the related
consolidated statements of income, cash flows and shareholders' equity for the
year ended October 31, 1997. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these consolidated financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of Flour City International, Inc.
at October 31, 1997, and the results of its operations and its cash flows for
the year ended October 31, 1997 in conformity with generally accepted accounting
principles.
DELOITTE & TOUCHE LLP
Nashville, Tennessee
December 5, 1997
F-2
<PAGE> 48
INDEPENDENT AUDITORS' REPORT
To the Shareholders and Board of Directors of
Flour City Architectural Metals (Pacific) Ltd.:
We have audited the accompanying consolidated balance sheet of Flour City
Architectural Metals (Pacific) Ltd. and subsidiaries ("FCAM Pacific") as of
October 31, 1996, and the related consolidated statements of income, cash flows
and shareholders' equity for each of the two years in the period ended October
31, 1996. These financial statements are the responsibility of FCAM Pacific's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of Flour City Architectural Metals
(Pacific) Ltd. and subsidiaries at October 31, 1996, and the results of their
operations and their cash flows for each of the two years in the period ended
October 31, 1996 in conformity with accounting principles generally accepted in
the United States of America.
DELOITTE TOUCHE TOHMATSU
Hong Kong
June 26, 1997
F-3
<PAGE> 49
FLOUR CITY INTERNATIONAL, INC. AND PREDECESSOR
FLOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
CONSOLIDATED BALANCE SHEETS
OCTOBER 31, 1996 AND 1997
ASSETS
<TABLE>
<CAPTION>
OCTOBER 31,
--------------------------
1996 1997
---------- -----------
<S> <C> <C>
Current assets:
Cash and cash equivalents................................... $1,401,249 $ 341,825
Restricted deposits......................................... 2,357,346 3,045,817
Accounts receivable, net of allowance for doubtful
accounts of $153,846 and $777,625 in 1996 and 1997........ 2,317,900 13,401,603
Costs and estimated earnings in excess of
billings on uncompleted contracts......................... 258,649 773,537
Inventories................................................. 563,076 --
Note receivable (note 13)................................... -- 1,395,000
Deferred income taxes....................................... -- 697,285
Other current assets........................................ 108,119 445,116
---------- ----------
Total current assets................................... 7,006,339 20,100,183
Property, plant and equipment, net (note 4)...................... 170,614 455,027
Receivable from joint venture corporations (note 7).............. 192,305 177,084
Investment in joint venture corporations (note 5)................ 410,725 410,725
Goodwill (note 13)............................................... -- 1,268,286
Other assets..................................................... -- 157,344
---------- ----------
Total assets........................................... $7,779,983 $22,568,649
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable............................................ $ 21,155 $ 3,261,864
Bank borrowings (note 9).................................... 166,141 462,993
Accrued expenses............................................ 145,626 770,277
Billings in excess of costs and estimated earnings
on uncompleted contracts.................................. 4,711,361 5,856,524
Advance from shareholders and directors (note 7)............ 42,843 148,339
Other current liabilities................................... 397,965 285,187
Income taxes payable (note 3)............................... 56,410 506,530
Joint venture corporation capital contribution payable (note
5)........................................................ 361,246 297,142
---------- ----------
Total current liabilities.............................. 5,902,747 11,588,856
Minority interests............................................... 7,545 --
Negative goodwill (note 13)...................................... -- 1,820,642
Commitments and contingencies (note 6)
Stockholders' equity:
Common Stock (note 12)...................................... 100 3,052
Additional paid-in capital.................................. -- 1,852,074
Retained earnings........................................... 1,869,591 6,986,135
Unearned compensation (note 13)............................. -- (286,670)
Cumulative translation adjustment (note 2).................. -- 792,060
Stock subscription receivable (note 13)..................... -- (187,500)
---------- ----------
1,869,691 9,159,151
---------- ----------
Total liabilities and shareholders' equity............. $7,779,983 $22,568,649
========== ==========
</TABLE>
See accompanying notes to consolidated financial statements.
F-4
<PAGE> 50
FLOUR CITY INTERNATIONAL, INC. AND PREDECESSOR
FLOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED OCTOBER 31, 1995, 1996 AND 1997
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
-----------------------------------------
1995 1996 1997
---------- ---------- -----------
<S> <C> <C> <C>
Revenues.............................................. $4,805,853 $6,684,230 $31,875,264
Cost of revenues...................................... 2,772,145 3,665,358 18,030,449
---------- ---------- -----------
Gross profit.......................................... 2,033,708 3,018,872 13,844,815
Selling, general and administrative expenses.......... (1,006,122) (1,353,437) (6,116,678)
Non-cash stock compensation expense (note 13)......... -- -- (57,330)
Amortization of negative goodwill..................... -- -- 363,865
Amortization of goodwill and organizational costs..... -- -- (103,855)
---------- ---------- -----------
Operating income...................................... 1,027,586 1,665,435 7,930,817
Other income (expense):
Exchange loss (note 2).............................. -- -- (1,336,678)
Interest expense.................................... (1,379) (8,835) (52,132)
Loss related to joint venture corporation (note
5)............................................... -- (98,535) --
Interest income..................................... -- 66,822 104,494
Other income........................................ 124,538 80,537 326,070
---------- ---------- -----------
Income before minority interest and income taxes...... 1,150,745 1,705,424 6,972,571
Income taxes (note 3)................................. 154,835 148,813 1,752,496
---------- ---------- -----------
Income before minority interests...................... 995,910 1,556,611 5,220,075
Minority interests.................................... -- (8,974) 5,956
---------- ---------- -----------
Net income............................................ $ 995,910 $1,547,637 $ 5,226,031
========== ========== ===========
Net income per share (note 2)......................... $ .04 $ .06 $ .18
========== ========== ===========
Weighted average number of shares outstanding (note 2)
(in thousands)...................................... 25,182 25,182 28,676
========== ========== ===========
</TABLE>
See accompanying notes to consolidated financial statements.
F-5
<PAGE> 51
FLOUR CITY INTERNATIONAL, INC. AND PREDECESSOR
FOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
COMMON STOCK ADDITIONAL CUMULATIVE STOCK
------------------- PAID-IN RETAINED UNEARNED TRANSLATION SUBSCRIPTION
SHARES AMOUNT CAPITAL EARNINGS COMPENSATION ADJUSTMENT RECEIVABLE TOTAL
---------- ------ ---------- ----------- ------------ ---------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at October 31,
1994.................. 100 $ 100 $ -- $ 742,683 $ -- $ -- $ -- $ 742,783
Net income............ -- -- -- 995,910 -- -- -- 995,910
Dividend of $12,966
per share........... -- -- -- (1,296,601) -- -- -- (1,296,601)
---------- ------ ---------- ----------- --------- -------- --------- -----------
Balance at October 31,
1995.................. 100 100 -- 441,992 -- -- -- 442,092
Net income for the
year................ -- -- -- 1,547,637 -- -- -- 1,547,637
Dividend of $1,200 per
share............... -- -- -- (120,038) -- -- -- (120,038)
---------- ------ ---------- ----------- --------- -------- --------- -----------
Balance at October 31,
1996.................. 100 100 -- 1,869,591 -- -- -- 1,869,691
Dividend of $1,095 per
share............... -- -- -- (109,487) -- -- (109,487)
Recapitalization in
connection with
FCI's acquisition of
FCAM Pacific (notes
1 and 13)........... 8,999,900 800 (800) -- -- -- -- --
Employee stock grant
(note 13)........... 1,000,000 100 343,900 -- (344,000) -- -- --
Compensation expense
(note 13)........... -- -- -- -- 57,330 -- -- 57,330
Issuance of shares and
recapitalization in
connection with the
Public Merger (notes
1 and 13)........... 20,516,667 2,052 1,508,974 -- -- -- (187,500) 1,323,526
Net income.............. -- -- -- 5,226,031 -- -- -- 5,226,031
Translation
adjustment............ -- -- -- -- -- 792,060 -- 792,060
---------- ------ ---------- ----------- --------- -------- --------- -----------
Balance at October 31,
1997.................. 30,516,667 $3,052 $1,852,074 $ 6,986,135 $ (286,670) $792,060 $ (187,500) $ 9,159,151
========== ====== ========== =========== ========= ======== ========= ===========
</TABLE>
See accompanying notes to consolidated financial statements.
F-6
<PAGE> 52
FLOUR CITY INTERNATIONAL, INC., AND PREDECESSOR
FLOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED OCTOBER 31, 1995, 1996 AND 1997
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
------------------------------------------
1995 1996 1997
----------- ---------- -----------
<S> <C> <C> <C>
Cash flows from operating activities:
Net income......................................... $ 995,910 $1,547,637 $ 5,226,031
Adjustments to reconcile net income to net cash
(used in) provided by operating activities:
Depreciation and amortization................... 12,251 43,213 (172,181)
Non-cash stock compensation..................... -- -- 57,330
Deferred income taxes........................... -- -- 802,715
Minority interests.............................. -- 8,974 (7,545)
Changes in operating assets and liabilities net of
effects of acquisition:
Restricted deposits............................. -- (2,357,346) (688,471)
Accounts receivable............................. (934,959) (935,746) (2,056,774)
Receivable from affiliates...................... (30,210) (1,504) --
Costs, estimated earnings and billings on
uncompleted contracts, net.................... 3,519,081 1,413,163 (6,856,725)
Inventories..................................... -- (563,076) 562,812
Other assets.................................... (34,405) (37,529) (291,107)
Receivable from joint venture................... -- (192,305) 15,221
Accounts payable and accrued expenses........... (118,796) 81,280 1,932,203
Amounts due to joint venture corporations....... (58,133) -- --
Other current liabilities....................... 323,954 (175,738) 136,514
Income taxes payable............................ -- -- 450,120
Amounts due to directors........................ 65,732 47,800 105,496
----------- ---------- ----------
Net cash provided by (used in) operating
activities......................................... 3,740,425 (1,121,177) (784,361)
----------- ---------- ----------
Cash flows from investing activities:
Purchase of property, plant and equipment.......... (87,715) (98,676) (372,242)
Investment in joint venture corporations........... -- (98,844) (64,104)
Purchase of subsidiary net of cash and cash
equivalent acquired............................. -- 61,449 100
----------- ---------- ----------
Net cash used in investing activities................ (87,715) (136,071) (436,246)
----------- ---------- ----------
Cash flows from financing activities:
Increase in bank borrowings........................ 86,800 328,633 533,670
Cash dividends paid................................ (1,296,601) (120,038) (109,487)
----------- ---------- ----------
Net cash (used in) provided by financing
activities......................................... (1,209,801) 208,595 424,183
----------- ---------- ----------
Effect of exchange rate changes on cash.............. -- -- (263,000)
----------- ---------- ----------
Net increase (decrease) in cash and cash
equivalents........................................ 2,442,909 (1,048,653) (1,059,424)
Cash and cash equivalents, beginning of period ...... 6,993 2,449,902 1,401,249
----------- ---------- ----------
Cash and cash equivalents, end of period............. $ 2,449,902 $1,401,249 $ 341,825
----------- ---------- ----------
Supplemental cash flow information:
Cash paid during the period for:
Interest........................................ $ 1,379 $ 8,835 $ 52,132
Income taxes.................................... 154,835 148,813 477,496
Significant non-cash financing activities:
Non-cash stock compensation........................ $ -- $ -- $ 344,000
=========== ========== ==========
</TABLE>
See accompanying notes to consolidated financial statements.
F-7
<PAGE> 53
FLOUR CITY INTERNATIONAL, INC. AND PREDECESSOR
FLOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. GENERAL
Flour City Architectural Metals (Pacific) Limited ("FCAM Pacific") is
incorporated in the British Virgin Islands and operates through four partly and
wholly owned subsidiaries.
On January 17, 1997, FCAM Pacific was acquired by Flour City International,
Inc. ("FCI"), a Nevada corporation with no assets or operations, in an exchange
of stock. The previous owners of FCAM Pacific became shareholders of 90% of the
common stock of FCI, with the remaining 10% held by management of Flour City
Architectural Metals, Inc. ("FCAM") pursuant to employment agreements.
On January 24, 1997, effective January 1, 1997, FCI acquired FCAM from
Armco, Inc. ("Armco") for $100 (the "Armco Sale").
Effective May 16, 1997, International Forest Industries, Inc. ("IFI"), a
Nevada corporation with nominal assets and operations, acquired FCI in an
exchange of stock with the previous shareholders of FCI acquiring approximately
92% of the common stock of IFI and the existing shareholders of IFI retaining 8%
of its common stock. IFI then changed its name to Flour City International, Inc.
and FCI was merged into it. Flour City International, Inc. and its subsidiaries
and its historical accounting predecessor is herein referred to as the
"Company."
The acquisition of FCAM Pacific by FCI on January 17, 1997 and the
acquisition of FCI by IFI on May 16, 1997 have both been treated as reverse
purchase acquisitions with FCAM Pacific being considered the acquiring
corporation in the January 17, 1997 transaction and FCI being considered the
acquiring corporation in the May 16, 1997 transaction. The acquisition of FCAM
by FCI effective January 1, 1997 was accounted for as a purchase acquisition. As
a result, these financial statements present FCAM Pacific as the predecessor and
continuing entity for accounting purposes and utilize the FCAM Pacific
historical basis of accounting. The financial statements present results of
operations and financial position of the following entities from the date
indicated to October 31, 1997:
<TABLE>
<S> <C>
FCAM Pacific...................................... November 1, 1994
FCAM.............................................. January 1, 1997
FCI............................................... January 17, 1997
IFI............................................... May 16, 1997
</TABLE>
The principal activities of the Company are design, supply and installation
of curtain wall. It operates through subsidiaries and joint venture corporations
principally in the United States ("U.S."), Hong Kong, Thailand, Malaysia and the
Peoples' Republic of China (the "PRC").
The financial statements of the Company have been prepared in accordance
with accounting principles generally accepted in the United States of America
("U.S. GAAP") which differ from those used in the statutory accounts of its
subsidiaries. There are no material differences between the U.S. GAAP amounts
and the amounts used in the statutory accounts of the subsidiaries.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of consolidation -- The consolidated financial statements
include the assets, liabilities, revenues and expenses of all material
subsidiaries. All material intercompany transactions and balances have been
eliminated.
Investments in joint venture corporations are accounted for at cost as
management does not have the ability to exercise significant influence over
their operations.
F-8
<PAGE> 54
FLOUR CITY INTERNATIONAL, INC. AND PREDECESSOR
FLOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
Revenue and cost recognition -- The Company is engaged in various types of
construction under long-term construction contracts. The accompanying financial
statements have been prepared using the percentage-of-completion method of
accounting and, therefore, take into account the cost, estimated earnings and
revenue to date on contracts not yet completed.
The amount of revenue recognized at statement date is the portion of the
total contract price that the cost expended to date bears to the anticipated
final total cost, based on current estimates of cost to complete. Contract cost
includes all direct labor and benefits, materials unique to or installed in the
project, subcontract costs, and allocated indirect construction costs. From time
to time the Company makes claims for additional billings to its customers
because of owner-caused delays, incomplete specifications or similar reasons.
Such claims involve negotiations and sometimes litigation. No revenue is
included for claims until agreement is obtained that such amount is owed.
As the long-term contracts extend over one or more years, revisions in
estimates of cost and earnings during the course of the work are reflected in
the accounting period in which the facts that require the revision become known.
At the time a loss on a contract becomes known, the entire amount of the
estimated ultimate loss is recognized in the financial statements.
Cash and cash equivalents -- Cash and cash equivalents include cash on
hand, cash accounts, interest bearing savings accounts, and time certificates of
deposit with an original maturity of three months or less.
Restricted deposits -- Restricted deposits represent funds set aside to
collateralize performance bonds. They represent interest bearing securities
maturing within twelve months from date of purchase. The market value of such
securities approximates cost.
Trade accounts receivable -- In accordance with terms of long-term
contracts, certain percentages of billings are withheld by customers until
completion and acceptance of the contracts. Final payments of all such amounts
withheld which might not be received within a one-year period from October 31,
1997 are $2,825,353. In conformity with trade practice, however, the full amount
of accounts receivable has been included in current assets.
Inventory -- Inventory, consisting principally of aluminium ingots, is
stated at the lower of cost, determined by the weighted average method, or
market.
Property, plant and equipment -- Property, plant and equipment is stated at
cost.
Depreciation and amortization -- Depreciation is provided to write off the
cost of property, plant and equipment over their estimated useful lives, using
the straight line method, at the following rates per annum:
<TABLE>
<S> <C>
Office equipment.............................................. 25%
Furniture and fixtures........................................ 20%
Leasehold improvements........................................ 20%
Motor vehicles................................................ 25%
</TABLE>
Income taxes -- The Company uses an asset and liability approach in
providing for income taxes on all transactions that have been recognised in the
financial statements, in accordance with Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes" ("SFAS 109"). SFAS 109 requires
deferred taxes be adjusted to reflect the tax rates at which future taxable
amounts will be settled or recognised. The effects of tax rate changes on future
deferred tax liabilities and deferred tax benefits, as well as other changes in
income tax laws, are recognised in net earnings in the period such changes are
enacted. No provision has been made for taxes on undistributed earnings of
foreign subsidiaries to the extent that it is management's intent to permanently
reinvest such earnings and their current taxability is not reasonably foreseen.
Provision
F-9
<PAGE> 55
FLOUR CITY INTERNATIONAL, INC. AND PREDECESSOR
FLOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
for taxes is made on such unremitted earnings to the extent that management
believes they will be taxed at the parent company level.
Foreign currency translation -- The consolidated financial statements of
the Company are presented in U.S. dollars. The majority of the Company's
operations outside the United States are conducted in Hong Kong dollars or Thai
baht.
On consolidation, the financial statements of subsidiaries outside the
United States are translated from the local functional currency into U.S.
dollars in accordance with Statement of Financial Accounting Standards No. 52,
"Foreign Currency Translation." Accordingly, all assets and liabilities are
translated at the exchange rate prevailing at the balance sheet date and all
income and expenditure items are translated at the average rates for each of the
years. Gains or losses from foreign currency transactions are included in net
income.
On July 2, 1997 the Thai Baht was effectively devalued and allowed to float
against the U.S. dollar and other currencies. As a result, an exchange loss of
the equivalent of $1,336,676 was realized and reflected in the statement of
income for the year ended October 31, 1997. The translation of the financial
statements of the Company's Thai subsidiary has resulted in a cumulative
translation adjustment of $792,060 at October 31, 1997.
Employee benefits -- The Company does not provide any retirement or
postretirement benefits other than a defined contribution 401k plan.
Use of estimates -- The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
Asset impairment -- The Company assesses impairment of long-lived assets,
including goodwill, in accordance with criteria consistent with the provisions
of Financial Accounting Standard No. 121, Accounting for the Impairment of
Long-Lived Assets and Long-Lived Assets to Be Disposed Of.
Earnings per share -- Earnings per share is based on the weighted average
number of Common Shares outstanding during each of the years, after giving
retroactive effect to the recapitalizations and mergers with IFI and FCI.
Unaudited pro forma earnings per share after giving retroactive effect to the 1
for 7 reverse stock split anticipated to be declared prior to the offering are
$.28, $.43 and $1.28 for each of the three years in the period ended October 31,
1997, respectively.
3. INCOME TAXES
The Company is not taxed in the British Virgin Islands where FCAM Pacific
is incorporated. The Company's subsidiaries incorporated in Hong Kong are
subject to Hong Kong taxation on their activities conducted in Hong Kong. As
described in Note 1, on January 17, 1997, FCAM Pacific became a subsidiary of a
United States corporation and, as a consequence, became subject to provisions of
the United States income tax code. As a result, the taxing jurisdiction of the
consolidated group changed to the United States effective as of January 17,
1997.
F-10
<PAGE> 56
FLOUR CITY INTERNATIONAL, INC. AND PREDECESSOR
FLOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
Income is subject to taxation in the various countries in which the Company
and its subsidiaries operate. The components of income before income taxes are
as follows:
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
----------------------------------------
1995 1996 1997
---------- ---------- ----------
<S> <C> <C> <C>
Hong Kong...................................... $ (602,419) $ (577,119) $ (376,909)
Malaysia and Thailand.......................... 1,753,164 2,282,543 3,706,548
United States.................................. -- -- 3,642,932
---------- ---------- ----------
$1,150,745 $1,705,424 $6,972,571
========== ========== ==========
</TABLE>
The provision for income taxes consists of the following:
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
------------------------------------
1995 1996 1997
-------- -------- ----------
<S> <C> <C> <C>
Current:
Hong Kong....................................... $ -- $ -- $ --
Malaysia and Thailand........................... 154,835 148,813 252,496
United States................................... -- -- 697,285
-------- -------- ----------
154,835 148,813 949,781
Deferred -- United States......................... -- -- 802,715
-------- -------- ----------
$154,835 $148,813 $1,752,496
======== ======== ==========
</TABLE>
Deferred taxes consist of the following:
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
----------------------------------
1995 1996 1997
-------- -------- --------
<S> <C> <C> <C>
Net operating loss carryforwards in Hong Kong...... $ -- $ 58,696 $ 52,850
Valuation allowance................................ -- (58,696) (52,850)
Basis difference in contracts in process........... -- -- 400,000
Allowance for doubtful accounts.................... -- -- 150,000
Other.............................................. -- -- 147,285
-------- -------- ----------
$ -- $ -- $697,285
======== ======== ==========
</TABLE>
A valuation allowance has been established for deferred tax assets related
to net operating loss carryforwards in Hong Kong as management believes it is
more likely than not such amounts will not be realized. At October 31, 1997, no
valuation allowance related to other deferred tax assets was recorded as
management believes it is more likely than not such assets will be realized.
F-11
<PAGE> 57
FLOUR CITY INTERNATIONAL, INC. AND PREDECESSOR
FLOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
The effective tax rate of the Company varied from the statutory rate (the
Hong Kong statutory rate is used through October 31, 1996 and the United States
rate is used thereafter) for the following reasons:
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
-------------------------------------
1995 1996 1997
-------- --------- ----------
<S> <C> <C> <C>
Statutory tax rate............................... 16.5% 16.5% 34%
======== ======== ==========
Statutory tax rate applied to income before
taxes.......................................... $189,873 $ 281,395 $2,370,674
State income taxes............................... -- -- 218,576
Profits in foreign subsidiaries taxed at less
than the statutory rate........................ (35,038) (132,582) (661,781)
Net goodwill amortization........................ -- -- (105,000)
Other............................................ -- -- (69,973)
-------- -------- ----------
Income tax provision............................. $154,835 $ 148,813 $1,752,496
======== ======== ==========
</TABLE>
The amount of accumulated earnings of subsidiaries outside of the U.S. at
October 31, 1997 for which U.S. taxes have not been provided as management does
not intend to repatriate such amounts or otherwise cause them to become taxable
is approximately $4,800,000.
4. PROPERTY, PLANT AND EQUIPMENT -- NET
Property, plant and equipment consists of the following:
<TABLE>
<CAPTION>
OCTOBER 31,
----------------------
1996 1997
-------- ---------
<S> <C> <C>
At cost:
Office equipment.................................... $149,714 $ 369,348
Furniture and fixtures.............................. 70,381 162,376
Leasehold improvements.............................. 14,977 71,590
Motor vehicles...................................... 10,256 14,256
-------- ---------
Total................................................. 245,328 617,570
Less: Accumulated depreciation and amortization....... (74,714) (162,543)
-------- ---------
Net book value........................................ $170,614 $ 455,027
======== =========
</TABLE>
5. INTEREST IN JOINT VENTURE CORPORATIONS
<TABLE>
<CAPTION>
OCTOBER 31,
---------------------
1996 1997
-------- --------
<S> <C> <C>
Foshan Weidu Aluminium Window Manufacturing Company,
Ltd.................................................. $272,267 $272,267
Foshan Weidu Decoration Engineering Company, Ltd....... 138,458 138,458
-------- --------
$410,725 $410,725
======== ========
</TABLE>
The Company, through a subsidiary, owns 30% of each of the above
corporations at October 31, 1997. During 1996, the Company acquired 70% of the
equity of Foshan Weidu Decoration Engineering Company, Ltd. and disposed of 40%
in the same year resulting in a loss of $84,747, which is included in the loss
related to joint venture in 1996.
The joint venture capital contribution payable of is principally for a
commitment to provide additional capital to Foshan Weidu Decoration Engineering
Company, Ltd.
F-12
<PAGE> 58
FLOUR CITY INTERNATIONAL, INC. AND PREDECESSOR
FLOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
6. COMMITMENTS AND CONTINGENCIES
The Company leases premises under various operating leases. At October 31,
1997, the Company and its subsidiaries were committed under operating leases
requiring minimum rentals as follows:
<TABLE>
<S> <C>
Year ending October 31:
1998............................................................ $268,758
1999............................................................ 87,100
2000............................................................ 101,948
2001............................................................ 101,948
2002............................................................ 30,303
--------
Total minimum lease payments...................................... $590,057
========
</TABLE>
In addition to the above operating lease commitments there is a performance
guarantee of $129,534 outstanding in relation to a construction contract in
progress.
FCAM is a party to legal proceedings incidental to its business. In one
case, FCAM filed suit against a subcontractor for non-performance in the amount
of $1.4 million and the subcontractor has filed a counterclaim against FCAM in
the amount of $1.7 million. There is currently no scheduled date for the
commencement of trial. Other litigation to which the Company is a party is
immaterial. In the opinion of management, any ultimate liability with respect to
these actions will not materially affect the financial position, results of
operations or cash flows of the Company.
7. RELATED PARTY TRANSACTIONS
SHAREHOLDERS AND MANAGEMENT
At October 31, 1997, the Company had outstanding loans payable to directors
and shareholders in the amount of $148,339. The loans are unsecured, carry no
interest and have no fixed terms of repayment.
JOINT VENTURE CORPORATIONS
The Company and its subsidiaries have transactions with its 30% owned joint
venture corporations as follows:
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
----------------------------------
1995 1996 1997
-------- -------- --------
<S> <C> <C> <C>
Sales to joint venture corporations........ $282,145 $370,408 $110,841
</TABLE>
The Company and its subsidiaries had the following balances with the above
joint ventures:
<TABLE>
<CAPTION>
OCTOBER 31,
---------------------
1996 1997
-------- --------
<S> <C> <C>
Amounts receivable from joint venture corporations..... $192,305 $177,084
</TABLE>
8. SEGMENT INFORMATION
The Company operates in one business segment, which is to design, supply
and install curtain wall.
F-13
<PAGE> 59
FLOUR CITY INTERNATIONAL, INC. AND PREDECESSOR
FLOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
An analysis of revenues, operating profit and identifiable assets by
geographic location as provided for under Statement of Financial Accounting
Standards No. 14, Financial Reporting for Segments of a Business Enterprise, is
as follows:
<TABLE>
<CAPTION>
HONG KONG MALAYSIA AND UNITED
AND THE PRC THAILAND STATES CONSOLIDATED
----------- ------------ ----------- ------------
<S> <C> <C> <C> <C>
YEAR ENDED OCTOBER 31, 1995
Revenues from third parties............ $1,160,898 $ 3,362,810 $ -- $ 4,523,708
Revenues from joint venture
corporations......................... 282,145 -- -- 282,145
---------- ----------- ----------- -----------
Total revenues....................... 1,443,043 3,362,810 -- 4,805,853
Income (loss) before income taxes...... (611,975) 1,762,720 -- 1,150,745
Identifiable assets.................... 1,228,102 2,907,481 -- 4,135,583
========== =========== =========== ===========
YEAR ENDED OCTOBER 31, 1996
Revenues from third parties............ $1,418,769 $ 4,895,053 $ -- $ 6,313,822
Revenues from joint venture
corporations......................... 370,408 -- -- 370,408
---------- ----------- ----------- -----------
Total revenues....................... 1,789,177 4,895,053 -- 6,684,230
Income (loss) before income taxes...... (577,119) 2,282,543 -- 1,705,424
Identifiable assets.................... 5,086,701 2,693,282 -- 7,779,983
========== =========== =========== ===========
YEAR ENDED OCTOBER 31, 1997
Revenues from third parties............ $1,970,177 $ 10,736,794 $19,057,452 $ 31,764,423
Revenues from joint venture
corporations......................... 110,841 -- -- 110,841
---------- ----------- ----------- -----------
Total revenues....................... 2,081,018 10,736,794 19,057,452 31,875,264
Income (loss) before income taxes...... (376,909) 3,706,548 3,642,932 6,972,571
Identifiable assets.................... 1,888,709 7,283,750 13,396,190 22,568,649
========== =========== =========== ===========
</TABLE>
Export sales for the year ended October 31, 1995 were to the PRC in the
amount of $583,965. In subsequent periods, export sales were less than 10% of
total revenues.
9. BANK BORROWINGS
These represent borrowings in the form of bills payable, invoice financing,
and other short-term loans with certain commercial banks.
<TABLE>
<CAPTION>
YEAR ENDED AND AT OCTOBER 31,
--------------------------------------
1995 1996 1997
-------- ---------- ----------
<S> <C> <C> <C>
Total credit facilities available....... $115,385 $1,282,051 $1,282,051
Total utilized facilities............... $ 86,800 $ 166,141 462,993
Weighted average interest rate on
borrowings at end of year............. 10.50% 10.25% 9.5%
</TABLE>
All the above credit facilities were guaranteed by the Chairman of the
Board of Directors throughout the relevant years. Interest rates in respect of
such facilities are generally based on the banks' prime lending rates and the
credit lines are normally subject to annual review.
F-14
<PAGE> 60
FLOUR CITY INTERNATIONAL, INC. AND PREDECESSOR
FLOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
10. CONCENTRATIONS OF CREDIT RISK AND MAJOR CUSTOMERS
Details of the customers accounting for 10% or more of total revenues and
accounts receivable for each of the three years ended and at October 31, 1995,
1996 and 1997 are as follows:
<TABLE>
<CAPTION>
YEAR ENDED AND AT
OCTOBER 31,
----------------------
1995 1996 1997
---- ---- ----
<S> <C> <C> <C>
Revenues:
Customer A......................................... 14% -- --
Customer B......................................... 70% 76% 34%
Customer C......................................... -- -- 33%
Accounts receivable:
Customer A......................................... 36% 22% --
Customer B......................................... 53% 70% 31%
Customer C......................................... -- -- 6%
</TABLE>
11. FAIR VALUE OF FINANCIAL INSTRUMENTS
The carrying value of cash and cash equivalents, restricted deposits,
receivable from joint venture corporations, investment in joint venture
corporations, advance from shareholders and amounts due to joint venture
corporations, are reasonable estimates of their fair value because of the
relatively short maturities of these instruments. The carrying value of bank
loans payable approximate fair value as they have variable interest rates.
12. COMMON SHARES
Common Stock at October 31, 1995 and 1996 for FCAM Pacific and October 31,
1997 for the Company is as follows:
<TABLE>
<CAPTION>
FCAM
PACIFIC THE COMPANY
------- -------------------
<S> <C> <C>
Par value........................................... $1.00 $.0001
Shares authorized................................... 50,000 50,000,000
Shares issued and outstanding....................... 100 30,516,667
</TABLE>
F-15
<PAGE> 61
FLOUR CITY INTERNATIONAL, INC. AND PREDECESSOR
FLOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
13. ACQUISITIONS
The net purchase price paid for the acquisitions in 1997 of FCAM, FCI and
IFI described in Note 1 was allocated to the fair value of the assets,
liabilities and contracts assumed, with the difference between fair value of net
identified assets acquired and the amounts paid debited or credited to goodwill
or negative goodwill as follows:
<TABLE>
<CAPTION>
ACQUISITION
----------------------------------
FCI FCAM IFI
--- ---------- -----------
<S> <C> <C> <C>
Billed accounts receivable.......................... $-- $7,971,869 $ --
Other assets........................................ -- 251,785 --
Deferred income taxes............................... -- 1,500,000 --
Note receivable -- Armco............................ -- 1,395,000 --
Goodwill............................................ -- -- 1,323,426
Payables and other current liabilities.............. -- (1,447,047) --
Billings in excess of cost and estimated earnings on
uncompleted contracts............................. -- (7,487,000) --
Negative goodwill................................... -- (2,184,507) --
--- ----------- ----------
Net amount paid..................................... -- $ 100 $ 1,323,426
=== =========== ==========
</TABLE>
Goodwill is being amortized over 20 years and negative goodwill is being
amortized over 5 years, both on a straight line basis.
The note receivable from Armco is unsecured and is without interest. It is
payable upon the occurrence of the Company either posting a performance bond or
completing and relieving Armco of performance obligations on certain contracts
assumed.
The net amount paid in the Armco Sale was $100 cash. The net amount paid in
the IFI acquisition (the "Public Merger") represents the value attributable to
the 8% of equity (2,536,000 shares) retained by the shareholders of IFI as
determined by subsequent trading in the stock discounted for lack of an active
market.
One shareholder of IFI had subscribed to but not paid for 750,000 shares of
IFI common stock for $187,500. This subscription was subject to repurchase by
the Company at the subscription price. In November 1997 the Company exercised
its repurchase right and the subscription receivable was cancelled and the
shares returned to the Company.
The operating results of these acquired businesses have been included in
the Consolidated Statement of Income from the respective dates of acquisition.
On the basis of an unaudited pro forma consolidation of the results of
operations as if the acquisitions had taken place at November 1, 1995,
consolidated revenues would have been $24,283,000 and $35,229,000 for the years
ended October 31, 1996 and 1997, respectively. Consolidated pro forma net income
(loss) and net income (loss) per share would have been $(1,372,000) and
$5,414,000 and $(.05) per share and $.18 per share for the years ended October
31, 1996 and 1997, respectively, which does not give effect to the anticipated
1-for-7 reverse stock split to be effected prior to the Offering. Such pro forma
amounts are not necessarily indicative of what the actual consolidated results
of operations might have been if the acquisitions had been effective at the
beginning of fiscal 1996. In computing the pro forma amounts, no adjustment has
been made to retroactively reflect the amounts allocated to the fair value of
the contracts acquired from FCAM on January 1, 1997, as it is not possible to
recast what values would have been attributable to such contracts at November 1,
1995 nor what effect such contracts might have had on the purchase price of
FCAM.
F-16
<PAGE> 62
FLOUR CITY INTERNATIONAL, INC. AND PREDECESSOR
FLOUR CITY ARCHITECTURAL METALS (PACIFIC) LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
Three employees of the Company, in connection with their employment
agreements effective January 1, 1997, have been granted an aggregate of
1,000,000 shares of restricted common stock of the Company (2,798,067 shares
after the merger with IFI). Such shares vest five years after date of grant and
have provisions for accelerated vesting if certain earnings targets are met. The
fair value of the stock issued at the date of grant has been reflected as
unearned compensation and is charged to operations over five years.
14. RECENTLY ISSUED ACCOUNTING STANDARDS
Earnings per share -- In February 1997, the Financial Accounting Standards
Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No.
128, Earnings Per Share. SFAS No. 128 specifies the computation, presentation
and disclosure requirements for earnings per share ("EPS"). This new standard
requires the presentation of basic earnings per share based upon average common
shares outstanding and a diluted EPS based on average common shares outstanding
plus the dilutive effect of potential common shares. SFAS No. 128 is effective
for years ending after December 15, 1997 and early adoption is not permitted.
Upon the adoption of SFAS No. 128, EPS for prior periods will be restated to
conform to the new standard. The Company believes that the adoption of SFAS No.
128 will cause the Company to present diluted earnings per share equal to
earnings per share as presented in these financial statements.
Segment information -- In June 1997, the FASB issued SFAS No. 131,
Disclosures About Segments of an Enterprise and Related Information, which
supersedes portions of SFAS No. 14, Financial Reporting for Segments of a
Business Enterprise. SFAS No. 131 is effective for the Company commencing in its
year ending October 31, 1999. Company management has not completely assessed the
effects of SFAS No. 131 on its segment reporting, however, it does not currently
believe that there will be significant changes from the information currently
being reported.
Comprehensive income -- In June 1997, the FASB issued SFAS No. 130,
Reporting Comprehensive Income, which becomes effective for the Company
commencing in its year ending October 31, 1999. Company management does not
believe, based on current activities, that adoption of this statement will have
a significant effect on its financial statements except to the extent that
cumulative foreign currency translations are included in comprehensive income.
F-17
<PAGE> 63
INDEPENDENT AUDITORS' REPORT
Board of Directors
Flour City Architectural Metals, Inc.
Johnson City, Tennessee
We have audited the accompanying balance sheets of Flour City Architectural
Metals, Inc. ("FCAM"), as of December 31, 1995 and 1996, and the related
statements of operations, cash flows and stockholders' deficit for the years
then ended. These financial statements are the responsibility of the FCAM's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the financial position of Flour City Architectural Metals, Inc. as of
December 31, 1995 and 1996, and the results of its operations and its cash flows
for the years then ended in conformity with generally accepted accounting
principles.
DELOITTE & TOUCHE LLP
Nashville, Tennessee
June 4, 1997
F-18
<PAGE> 64
FLOUR CITY ARCHITECTURAL METALS, INC.
BALANCE SHEETS
DECEMBER 31, 1995 AND 1996
ASSETS
<TABLE>
<CAPTION>
1995 1996
------------ ------------
<S> <C> <C>
Current Assets:
Cash and cash equivalents (Note 2)............................ $ 124,528 $ 168,054
Accounts receivable, less allowance for doubtful accounts of
$372,342 and $430,342, respectively (Note 3)............... 9,632,823 7,987,138
Costs and estimated earnings in excess of billings on
uncompleted contracts...................................... 473,837 185,682
Other current assets.......................................... 96,916 64,750
------------ ------------
Total current assets....................................... 10,328,104 8,405,624
Property, Plant and Equipment, net (Notes 2 and 4).............. 2,299,649 740,069
------------ ------------
Total................................................. $ 12,627,753 $ 9,145,693
============ ============
LIABILITIES AND STOCKHOLDER'S DEFICIT
Current Liabilities:
Accounts payable.............................................. $ 2,178,397 $ 1,218,947
Accrued and other liabilities................................. 1,953,569 798,733
Billings in excess of costs and estimated earnings on
uncompleted contracts...................................... 3,041,092 3,656,738
Due to Armco and affiliates, net (Note 5)..................... 27,953,666 28,346,515
------------ ------------
Total current liabilities.................................. 35,126,724 34,020,933
Commitments and Contingencies (Note 10)
Stockholder's Deficit:
Common Stock, $1 par, 1,000 shares authorized, issued and
outstanding................................................ 1,000 1,000
Additional paid-in capital.................................... 1,991,748 1,991,748
Accumulated deficit........................................... (24,491,719) (26,867,988)
------------ ------------
Total stockholders' deficit................................ (22,498,971) (24,875,240)
------------ ------------
Total................................................. $ 12,627,753 $ 9,145,693
============ ============
</TABLE>
See notes to financial statements.
F-19
<PAGE> 65
FLOUR CITY ARCHITECTURAL METALS, INC.
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1995 AND 1996
<TABLE>
<CAPTION>
1995 1996
------------ ------------
<S> <C> <C>
Revenues (Notes 2 and 6)........................................ $ 22,942,579 $ 17,129,561
Cost of revenues (Notes 2 and 5)................................ (23,394,221) (15,085,547)
------------ ------------
Gross profit (loss)............................................. (451,642) 2,044,014
Selling, general and administrative expenses (Notes 5, 7, 8 and
9)............................................................ (5,533,445) (4,641,424)
------------ ------------
Operating income (loss)......................................... (5,985,087) (2,597,410)
Other income.................................................... 293,765 221,141
------------ ------------
Net loss........................................................ $ (5,691,322) $ (2,376,269)
============ ============
</TABLE>
See notes to financial statements.
F-20
<PAGE> 66
FLOUR CITY ARCHITECTURAL METALS, INC.
STATEMENTS OF STOCKHOLDER'S DEFICIT
YEARS ENDED DECEMBER 31, 1995 AND 1996
<TABLE>
<CAPTION>
COMMON STOCK
----------------- ADDITIONAL ACCUMULATED
SHARES AMOUNT PAID-IN-CAPITAL DEFICIT
------ ------ --------------- ------------
<S> <C> <C> <C> <C>
Balance, January 1, 1995...................... 1,000 $1,000 $ 1,991,748 $(18,800,397)
Net loss.................................... -- -- -- (5,691,322)
----- ------ ---------- ------------
Balance, December 31, 1995.................... 1,000 1,000 1,991,748 (24,491,719)
Net loss.................................... -- -- -- (2,376,269)
----- ------ ---------- ------------
Balance, December 31, 1996.................... 1,000 $1,000 $ 1,991,748 $(26,867,988)
===== ====== ========== ============
</TABLE>
See notes to financial statements.
F-21
<PAGE> 67
FLOUR CITY ARCHITECTURAL METALS, INC.
STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1995 AND 1996
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
---------------------------
1995 1996
----------- -----------
<S> <C> <C>
Cash flows from operating activities:
Net loss........................................................ $(5,691,322) $(2,376,269)
Adjustments to reconcile net loss to net cash used in operating
activities:
Depreciation................................................. 167,335 49,218
Provision for losses on contract receivables................. 846,648 624,724
Changes in assets and liabilities:
Decrease in accounts receivable.............................. 1,893,394 1,645,685
Decrease in costs and estimated earnings in excess of
billings on uncompleted contracts........................... 833,270 288,155
Decrease in other current assets............................. 1,450,289 32,166
Decrease in accounts payable................................. (1,472,880) (959,450)
Increase in billings in excess of costs and estimated
earnings on uncompleted contracts........................... 318,825 615,646
Decrease in accrued and other liabilities.................... (6,070,417) (1,779,560)
----------- -----------
Net cash used in operating activities........................ (7,724,858) (1,859,685)
Cash flows from investing activities:
Purchase of property and equipment.............................. (15,256) (18,481)
----------- -----------
Net cash used in investing activities........................ (15,256) (18,481)
Cash flows from financing activities:
Increase in due to Armco and affiliates......................... 7,606,418 1,921,692
----------- -----------
Net cash provided by financing activities.................... 7,606,418 1,921,692
----------- -----------
Net increase (decrease) in cash and cash equivalents.............. (133,696) 43,526
Cash and cash equivalents, beginning of year...................... 258,224 124,528
----------- -----------
Cash and cash equivalents, end of year............................ $ 124,528 $ 168,054
=========== ===========
Supplemental disclosures of cash flow information:
Significant non-cash investing and financing activity:
Property and equipment transferred at net book value to
another Armco affiliate:
Property and equipment....................................... $ -- $(1,528,843)
=========== ===========
Due to Armco and affiliates.................................. $ -- $ 1,528,843
=========== ===========
</TABLE>
See notes to financial statements.
F-22
<PAGE> 68
FLOUR CITY ARCHITECTURAL METALS, INC.
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995 AND 1996
1. ORGANIZATION AND BUSINESS
Flour City Architectural Metals, Inc. ("FCAM") was a wholly-owned
subsidiary of Armco, Inc. ("Armco") until January 24, 1997 at which time it was
sold to Flour City International, Inc. ("FCI"). Such sale was effective as of
January 1, 1997. In May 1997, FCI merged into a publicly traded shell
corporation, International Forest Industries, Inc. ("IFI"), which has changed
its name to Flour City International, Inc.
The historical financial statements through December 31, 1996 reflect only
the operations of the business of engineering, designing, fabricating and
installing high-rise curtainwall systems included in the January 1, 1997 sale
mentioned above. Such financial statements are stated on Armco's historical cost
basis.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and cost recognition -- FCAM is engaged in various types of
construction under long-term construction contracts. The accompanying financial
statements have been prepared using the percentage-of-completion method of
accounting and, therefore, take into account the cost, estimated earnings and
revenue to date on contracts not yet completed.
The amount of revenue recognized at statement date is the portion of the
total contract price that the cost expended to date bears to the anticipated
final total cost, based on current estimates of cost to complete. Contract cost
includes all direct labor and benefits, materials unique to or installed in the
project, subcontract costs, and allocated indirect construction costs. From time
to time FCAM makes claims for additional billings to its customers because of
owner-caused delays, incomplete specifications or similar reasons. Such claims
involve negotiations and sometimes litigation. No revenue is included for claims
until agreement is obtained that such amount is owed.
As the long-term contracts extend over one or more years, revisions in
estimates of cost and earnings during the course of the work are reflected in
the accounting period in which the facts that require the revision become known.
At the time a loss on a contract becomes known, the entire amount of the
estimated ultimate loss is recognized in the financial statements.
Use of estimates -- The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
FCAM continuously reviews estimated earnings from construction contracts
and makes necessary adjustments based on current evaluations of the indicated
outcome. In 1996, as a result of those evaluations, additional revenue on one
contract was recorded in the amount of $1,400,000 and additional losses on two
contracts were recorded in the aggregate amount of $1,500,000.
Cash equivalents -- Cash equivalents consist of short-term investments with
original maturities of 90 days or less stated at cost, which approximates market
value.
Property, plant and equipment -- Property, plant and equipment is stated at
cost. Depreciation is provided over the estimated useful lives of the assets
using the straight-line method. FCAM has adopted Statement of Financial
Accounting Standards ("SFAS") No. 121, Accounting for the Impairment of Long-
Lived Assets and for Long-Lived Assets to Be Disposed Of. The adoption of this
standard had no material effect on FCAM's financial statements.
Income taxes are accounted for in accordance with Statement of Financial
Accounting Standards ("SFAS") No. 109, Accounting for Income Taxes. The
statement requires that all existing potential future
F-23
<PAGE> 69
FLOUR CITY ARCHITECTURAL METALS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED DECEMBER 31, 1995 AND 1996
tax benefits be recognized as deferred tax assets and subjected to an impairment
evaluation based on the likelihood of realization.
3. ACCOUNTS RECEIVABLE
In accordance with terms of long-term contracts, certain percentages of
billings are withheld by customers until completion and acceptance of the
contracts. Final payments of all such amounts withheld which might not be
received within a one-year period from December 31, 1996 are $3,190,683. In
conformity with trade practice, however, the full amount of accounts receivable
has been included in current assets.
4. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment consists of the following at December 31:
<TABLE>
<CAPTION>
1995 1996
---------- ----------
<S> <C> <C>
Buildings................................................... $ 17,934 $ --
Leasehold improvements...................................... 18,420 18,420
Machinery and equipment..................................... 2,524,335 616,581
Furniture, fixtures and tools............................... 546,778 554,323
---------- ----------
Total............................................. 3,107,467 1,189,324
Less accumulated depreciation............................... 807,818 449,255
---------- ----------
Property, plant and equipment, net.......................... $2,299,649 $ 740,069
========== ==========
</TABLE>
5. RELATED PARTY BALANCES AND TRANSACTIONS
FCAM's operations for 1995 and 1996 were dependent upon the continuing
financial support from Armco through affiliates capital contributions or other
means. A summary of significant related party transactions with Armco and its
affiliates for the years ending December 31, 1995 and 1996 are as follows:
<TABLE>
<CAPTION>
1995 1996
---------- ----------
<S> <C> <C>
Purchase of manufacturing materials and labor............... $4,822,290 $2,461,356
Administrative costs........................................ 2,253,765 2,124,039
</TABLE>
Included in FCAM's accounts receivable is $960,000 due from Kasion
Contracting Co. Ltd., a Hong Kong corporation, which became an affiliate in 1997
pursuant to the transactions described in Note 1.
6. CONCENTRATIONS OF CREDIT RISK AND MAJOR CUSTOMERS
Details of the customers accounting for 10% or more of total revenues for
the years ended December 31, 1995 and 1996 are as follows:
<TABLE>
<CAPTION>
1995 1996
---- ----
<S> <C> <C>
Revenues:
Customer A................................................................... 18% 12%
Customer B................................................................... 43% 18%
Customer C................................................................... -- 16%
Customer D................................................................... 14% 13%
Customer E................................................................... -- 12%
</TABLE>
F-24
<PAGE> 70
FLOUR CITY ARCHITECTURAL METALS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED DECEMBER 31, 1995 AND 1996
7. LEASES
FCAM leases vehicles and certain equipment under operating leases. Future
minimum lease payments under noncancelable operating leases as of December 31,
1996 are as follows:
<TABLE>
<CAPTION>
YEAR ENDING
DECEMBER 31,
------------------------------------------------------------------
<S> <C>
1997......................................................... $103,520
1998......................................................... 97,584
1999......................................................... 34,000
2000......................................................... 34,000
2001......................................................... 34,000
--------
Total................................................... $303,104
========
</TABLE>
Total rental expense for the years ended December 31, 1995 and 1996
amounted to $403,369 and $315,517, respectively.
8. EMPLOYEE BENEFIT PLAN
FCAM employees participate in a 401(k) plan which provides for FCAM to
match a portion of employee contributions. Amounts charged to expense for the
years ended December 31, 1995 and 1996 were $158,542 and $263,704.
9. INCOME TAXES
There has been no provision for income taxes made for the years ended
December 31, 1995 and 1996 as FCAM experienced significant net operating losses
which were included on Armco's consolidated income tax returns. As a result of
the change in control effective January 1, 1997, net operating loss
carryforwards are restricted as to future use, and accordingly, no deferred tax
asset has been established for such item.
10. LITIGATION
FCAM is a party to legal proceedings incidental to its business. In the
opinion of management, any ultimate liability with respect to these actions will
not materially affect the financial position, results of operations or cash
flows of FCAM.
11. RESTRUCTURING CHARGE
During 1994, plans were developed to significantly reduce FCAM's future
operating costs and expenses and to improve productivity. This restructuring
program principally involved a reduction in the number of staff plus the
consolidation of offices and facilities and the reorganization of support
functions. An analysis of the activity in the reserve established in 1994 is as
follows:
<TABLE>
<S> <C>
BALANCE, January 1, 1995......................................... $ 360,828
Additional amounts provided.................................... 437,518
Costs charged against the reserve.............................. (360,828)
---------
BALANCE, December 31, 1995....................................... 437,518
Costs charged against the reserve.............................. (437,518)
---------
BALANCE, December 31, 1996....................................... $ --
=========
</TABLE>
In connection with the sale of FCAM in 1997 as described in Note 1, Armco
agreed to assume any further liabilities related to this restructuring.
F-25
<PAGE> 71
FLOUR CITY INTERNATIONAL, INC.
INTRODUCTION TO UNAUDITED PRO FORMA FINANCIAL INFORMATION
The following unaudited pro forma statement of operations of Flour City
International, Inc. (the "Company") for the year ended October 31, 1997 is
presented to show the effects of the acquisition of Flour City Architectural
Metals, Inc. ("FCAM") acquired as of January 1, 1997 (the "Armco Sale") and
International Forest Industries, Inc. ("IFI") acquired as of May 16, 1997 (the
"Public Merger"), which have been accounted for as purchase acquisitions,
assuming the acquisitions had occurred on November 1, 1996.
The unaudited pro forma financial information does not purport to represent
what the Company's financial position or results of operations would actually
have been had the transactions in fact occurred on the respective dates
indicated above, nor to project the Company's financial position or results of
operations for any future date or period. In the opinion of the Company's
management, all adjustments necessary for a fair presentation have been made.
This unaudited pro forma financial information should be read in conjunction
with the accompanying notes and the financial statements of the Company and the
related notes included elsewhere herein.
F-26
<PAGE> 72
FLOUR CITY INTERNATIONAL, INC.
UNAUDITED PRO FORMA STATEMENT OF INCOME
YEAR ENDED OCTOBER 31, 1997
(IN THOUSANDS EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
FCAM
COMPANY NOVEMBER 1, 1996 TO PRO FORMA PRO FORMA
HISTORICAL DECEMBER 31, 1996(A) IFI ADJUSTMENTS COMBINED
---------- -------------------- ---- ----------- ---------
<S> <C> <C> <C> <C> <C>
Revenues................................ $ 31,875 $3,354 $ -- $ -- $35,229
Cost of revenues........................ 18,030 2,704 -- -- 20,734
------- ------ --- ---- -------
Gross profit............................ 13,845 650 -- -- 14,495
Selling, general and administrative..... 6,116 530 -- -- 6,646
Non-cash stock compensation expenses.... 57 -- -- -- 57
Amortization of goodwill, net........... (259) -- -- (52)(a) (311)
------- ------ --- ---- -------
Operating income........................ 7,931 120 -- 52 8,103
Exchange loss......................... (1,337) -- -- -- (1,337)
Other revenue, net.................... 379 16 -- -- 395
------- ------ --- ---- -------
Income before minority interest and
income taxes.......................... 6,973 136 -- 52 7,161
Income taxes............................ 1,753 -- -- -- 1,753
------- ------ --- ---- -------
Income before minority interest......... 5,220 136 52 5,408
Minority interest....................... 6 -- -- -- 6
------- ------ --- ---- -------
Net income.............................. $ 5,226 $ 136 $ -- $ 52 $ 5,414
------- ------ --- ---- -------
Net income per share(b)................. $ 1.28 -- -- -- $ 1.26
-------
Weighted average common shares and
equivalents(b)........................ 4,097 -- -- 196(b) 4,293
======= ==== =======
</TABLE>
- ---------------
(a) To adjust the statement of operations to include the two months of activity
of FCAM for November and December 1996.
(b) Weighted average common shares and equivalent net income per share gives
effect to the 1 for 7 reverse stock split anticipated to be declared prior
to the Company completing the Offering.
F-27
<PAGE> 73
FLOUR CITY INTERNATIONAL, INC.
NOTES TO THE PRO-FORMA STATEMENTS OF INCOME
(1) To reflect the amortization of goodwill in the acquisition of IFI over 20
years and to reflect the amortization of negative goodwill in the
acquisition of FCAM over 5 years. No adjustment is made to retroactively
reflect the amounts allocated to the fair value of the contracts in process
acquired from FCAM on January 1, 1997 as it is not possible to recast what
values would have been attributable to such contracts at November 1, 1996,
nor what effect such contracts might have had on the purchase price of FCAM.
(2) To reflect shares issued to shareholders of IFI as outstanding for the
entire year.
F-28
<PAGE> 74
======================================================
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION IN CONNECTION WITH THIS OFFERING OTHER
THAN THOSE CONTAINED IN THIS PROSPECTUS, AND IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY OR THE UNDERWRITERS. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO
SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY
BY ANYONE IN ANY STATE IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR
IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO
OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER
ANY CIRCUMSTANCES CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN
IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Prospectus Summary.................... 3
Risk Factors.......................... 6
The Company........................... 13
Use of Proceeds....................... 14
Capitalization........................ 14
Dividend Policy....................... 14
Price Range of Common Stock........... 15
Dilution.............................. 15
Selected Financial Data............... 16
Management's Discussion and Analysis
of Financial Condition and Results
of Operations....................... 17
Business.............................. 23
Management............................ 33
Certain Transactions.................. 37
Principal Stockholders................ 38
Description of Capital Stock.......... 39
Shares Eligible for Future Sale....... 40
Underwriting.......................... 42
Legal Matters......................... 43
Experts............................... 43
Additional Information................ 44
Index to Financial Statements......... F-1
------------------------
UNTIL APRIL , 1998 (25 CALENDAR DAYS
AFTER THE DATE OF THIS PROSPECTUS), ALL
DEALERS EFFECTING TRANSACTIONS IN SHARES OF
THE COMMON STOCK, WHETHER OR NOT
PARTICIPATING IN THIS DISTRIBUTION, MAY BE
REQUIRED TO DELIVER A PROSPECTUS. THIS
DELIVERY REQUIREMENT IS IN ADDITION TO THE
OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS
WHEN ACTING AS UNDERWRITERS AND WITH RESPECT
TO THEIR UNSOLD ALLOTMENTS OF SUBSCRIPTIONS.
=============================================
</TABLE>
======================================================
2,000,000 SHARES
LOGO
FLOUR CITY
INTERNATIONAL, INC.
COMMON STOCK
---------------------
PROSPECTUS
---------------------
VAN KASPER & COMPANY
March , 1998
======================================================
<PAGE> 75
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The Company's expenses in connection with the offering, other than
underwriting discounts and commissions are set forth below. All of these amounts
are estimates, except the SEC registration fee and the NASD filing fee.
<TABLE>
<CAPTION>
AMOUNT PAYABLE BY REGISTRANT
----------------------------
<S> <C>
SEC Registration Fee................................. $ 9,356
NASD Filing Fee...................................... 3,260
Nasdaq National Market Listing Fee................... *
Blue Sky Fees and Expenses (Including Legal Fees).... *
Printing Costs....................................... *
Registrar and Transfer Agent Fees.................... *
Directors' and Officers' Liability Insurance
Premium............................................ *
Legal Fees and Expenses.............................. *
Underwriter's Nonaccountable Expense Allowance....... *
Accounting Fees and Expense.......................... *
Miscellaneous........................................ *
--------
Total...................................... 780,000
========
</TABLE>
- ---------------
* To be filed by amendment
ITEM 14. INDEMNIFICATION OF OFFICERS AND DIRECTORS
Section 78.751 of the Nevada Revised Statutes ("NRS") and the Company's
Articles of Incorporation and Bylaws contain certain provisions for
indemnification of officers and directors of the Company and in certain cases
employees and other persons. The Articles of Incorporation require the Company
to indemnify such persons to the full extent permitted by Nevada law. Each such
person will be indemnified in any proceeding if he acted in good faith and in a
manner which he reasonably believed to be in, or not opposed to, the best
interests of the Company, and with respect to a criminal action or proceeding,
had no reasonable cause to believe that such person's conduct was unlawful.
Indemnification would cover expenses, including attorney's fees, judgments,
fines and amounts paid in settlement.
The Company's Bylaws also provide that the Company's Board of Directors may
cause the Company to purchase and maintain insurance on behalf of any present or
past officer, director or agent or any other person serving at the request of
the Company insuring against any liability asserted against such person as a
result of their capacity as officer, director or agent or arising out of such
status, whether or not the Company would have the power to indemnify such
person. The Company intends to obtain directors' and officers' liability
insurance.
On January 7, 1998, the Company entered into indemnity agreements with
Messrs. Fong, Russo, Willis and Tang. The indemnity agreements indemnify such
persons against certain liabilities arising out of their service in their
capacities as directors and/or officers and constitute binding agreements of the
Company. The Company may from time to time enter into indemnity agreements with
additional individuals who become officers and/or directors of the Company.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
On May 16, 1997, International Forest Industries, Inc. ("IFI") merged with
Flour City International, Inc., a private Nevada corporation ("FCI"). Each share
of FCI was exchanged and converted into 2.798
II-1
<PAGE> 76
shares of IFI. IFI issued a total of 3,997,238(1) shares of common stock to FCI
in exchange for 1,428,571 shares of FCI. IFI was the surviving corporation. The
issuance of shares to FCI described above was exempt from the registration
provisions of the Securities Act of 1933, as amended (the "Act") by virtue of
Section 4(2), as transactions by the issuer not involving any public offering
and Regulation D under the Act.
On March 25, 1997, IFI issued 107,143 shares of Common Stock to Mr. Steven
Antebi, a shareholder of IFI in exchange for certain services including
consulting, administrative and corporate structuring. Mr. Antebi was, prior to
the sale of the Company's securities to him, fully informed and advised about
such matters concerning the Company, including its business, financial affairs
and other matters. No underwriters were used in connection with the issuance of
these shares and no commissions were paid to any person. The issuance of shares
to described above was exempt from the registration provisions of the Act by
virtue of Section 4(2). The Company later canceled all of the shares issued to
Mr. Antebi.
On January 17, 1997, FCI entered into a share exchange agreement with the
shareholders of Flour City Architectural Metals (Pacific) Ltd. ("FCAM Pacific").
FCI issued 1,142,857 shares to the FCAM Pacific shareholders in exchange for 14
shares of FCAM Pacific. The issuance of shares to FCAM Pacific's shareholders
described above was exempt from the registration provisions of the Act by virtue
of Section 4(2), as transactions by the issuer not involving any public
offering.
On January 16, 1997, Messrs. Russo, Willis and Ulbricht exercised their
stock purchase rights pursuant to employment agreements and purchased 199,862,
159,890 and 39,972 shares of common stock of FCI, respectively. The exercise
price was $0.00025 per share. The total number of shares issued to Messrs.
Russo, Willis and Ulbricht represented approximately 9% of the issued and
outstanding common stock of FCI. No general forms of advertising were used in
connection with the issuance of the shares. No underwriters were used in
connection with the issuance of these shares and no commissions were paid to any
person. Each purchaser signed an agreement providing that the shares may not be
transferred or sold other than pursuant to an effective registration statement
under the Act, or pursuant to an exemption from registration. The sale and
issuance of shares to described above was exempt from the registration
provisions of the Act by virtue of Section 4(2).
In September, 1996, MM Cork Enterprises, Inc. ("MMC"), which later changed
its name to IFI, offered and sold 55,651 shares of its common stock at $4.89 per
share for a total of $272,500 to two individuals and four related entities. The
shares were issued for investment purposes and not with a view to distribution.
The purchasers acquired the shares for their own account. Each purchaser was,
prior to the sale of the Company's securities to him, informed and advised about
such matters concerning the Company, including its business, financial affairs
and other matters. No general forms of advertising were used in connection with
the issuance of the shares. No underwriters were used in connection with the
issuance of these shares and no commissions were paid to any person. The shares
were offered pursuant to Section 4(2) of the Act.
In September, 1996, MMC offered and sold 51,056 shares of common stock to
Mr. Stephan Wingate at $0.19 per share for a total of $10,000. No underwriters
were used in connection with the issuance of these shares and no commissions
were paid to any person. No general forms of advertising were used in connection
with the issuance of the shares. The sale and issuance of shares to described
above was exempt from the registration provisions of the Act by virtue of
Section 4(2). On September 30, 1996, MMC and Mr. Wingate entered into a
rescission agreement whereby Mr. Wingate returned the shares purchased to MMC
and MMC returned Mr. Wingate's purchase price.
- ---------------
1 All share numbers and prices per share have been adjusted to reflect a 1 for
7 reverse stock split which will be effected prior to the consummation of the
Offering.
II-2
<PAGE> 77
ITEM 16. EXHIBITS AND FINANCIAL STATEMENTS
(a) EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION
- -------------- -------------------------------------------------------------------------------
<C> <S>
*1.1 Form of Underwriting Agreement
*3.1 Amended and Restated Articles of Incorporation of Flour City International,
Inc.
3.2 Articles of Merger of International Forest Industries, Inc., and Flour City
International, Inc.
3.3 By-laws of Flour City International, Inc.
*4.1 Underwriter's Warrant
*4.2 Form of Lock-Up Agreement
*5.1 Opinion of Manning Marder & Wolfe
10.1 Share Exchange Agreement between Flour City International, Inc. and John W. Y.
Tang, Gold Manor Limited, Dynamic Choice Enterprises and Wilson International
Limited dated January 17, 1997.
10.2 Stock Purchase Agreement between Flour City International, Inc., Armco, Inc.,
and Flour City Architectural Metals, Inc., dated as of January 1, 1997
10.3 Agreement and Plan of Merger by and among Flour City International, Inc. and
International Forest Industries, Inc., dated as of April 4, 1997
10.4 Flour City International, Inc. 1997 Stock Incentive Plan and Form of
Nonqualified Stock Option Agreement
10.5 Form of Indemnification Agreement
10.6 Employment Agreement between Flour City Architectural Metals, Inc. and Michael
J. Russo dated January 17, 1997
10.7 Employment Agreement by and between Flour City Architectural Metals (Asia)
Limited and John W. Y. Tang dated December 15, 1997
10.8 Ground and Building Lease Agreement dated December 20, 1993, Consent and
Assumption of Lease dated May 27, 1997
10.9 Lease Agreement between Douglas Dynamics, LLC and Flour City Architectural
Metals, Inc. dated as of January 1, 1997
10.10 Asset Transfer Agreement between Flour City Architectural Metals, Inc., and
Douglas Dynamics, LLC dated as of January 1, 1996
10.11 Manufacturing Agreement between Flour City Architectural Metals, Inc., and
Douglas Dynamics, LLC dated as of January 1, 1997
**10.12 Agreement between Flour City Architectural Metals, Inc., and Turner
Construction Company dated December 4, 1996
**10.13 Purchase Order #32895-1243 for U.C. Davis Medical Center in Sacramento,
California
**10.14 Trade Contract between Swiss Re Investors, Inc., and Flour City Architectural
Metals, Inc., dated May 19, 1997
11.1 Flour City International, Inc. Earnings Per Share
21.1 List of subsidiaries (See "The Company" in Part I of the Registration
Statement)
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of Deloitte Touche Tohmatsu
*23.3 Consent of Manning Marder & Wolfe (included in Exhibit 5.1)
24.1 Power of Attorney (see signature page)
27.1 Financial Data Schedule
</TABLE>
- ---------------
* To be filed by amendment
** Confidential treatment requested
(b) FINANCIAL STATEMENT SCHEDULES:
Report of Deloitte & Touche LLP, Independent Auditors
Report of Deloitte Touche Tohmatsu, Independent Auditors
II-3
<PAGE> 78
Schedule II Valuation and Qualifying Account
ITEM 17. UNDERTAKINGS
The Company will provide to the Underwriters at the closing or closings
specified in the underwriting agreement certificates in such denominations and
registered in such names as required by the Underwriters to permit prompt
delivery to each purchaser.
Insofar as indemnification for liabilities under the Securities Act of 1933
(the "Act") may be permitted to directors, officers and controlling persons of
the Company pursuant to the foregoing provisions, or otherwise, the issuer has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Company of expenses incurred or
paid by a director, officer or controlling person of the Company in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
The Company will, for determining liability under the Act, treat the
information omitted from the prospectus filed as part of this registration
statement in reliance upon Rule 430A and contained in the form of prospectus
filed by the Company under Rule 424(b)(1), or (4) or 497(h) under the Act as
part of this Registration Statement as of the time the Commission declared it
effective.
For determining liability under the Act, the Company will treat each
post-effective amendment that contains a form of prospectus as a new
registration statement, for the securities offered in the registration
statement, and that offering of the securities at that time as the initial bona
fide offering of those securities.
II-4
<PAGE> 79
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, in the City of Johnson City, State of Tennessee, on
the 7th day of January, 1998
FLOUR CITY INTERNATIONAL, INC.
By: /s/ MICHAEL J. RUSSO
------------------------------------
Michael J. Russo,
Chief Executive Officer and
President
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below appoints each of Michael Russo and Bryan Willis his true and lawful
attorney-in-fact and agent, with full power of substitution for him and in his
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement, and any
related Registration Statement filed pursuant to Rule 462(b) of the rules
adopted by the Securities and Exchange Commission under the Securities Act of
1933, as amended, and to file the same, with all exhibits thereto and other
documents in connection therewith, with the Securities and Exchange Commission,
granting unto such attorney-in-fact and agent, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes he might or could
do in person, hereby ratifying and conforming all that such attorney-in-fact and
agent, or his substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated below on the 7th day of January, 1998.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ----------------------------------------------- --------------------------------------------
<S> <C>
/s/ MICHAEL J. RUSSO Chief Executive Officer, President
- ----------------------------------------------- and Director
Michael J. Russo (Principal Executive Officer)
/s/ BRYAN R. WILLIS Chief Financial Officer
- ----------------------------------------------- (Principal Financial and
Bryan R. Willis Principal Accounting Officer)
/s/ JOHN W.Y. TANG Director
- -----------------------------------------------
John W.Y. Tang
/s/ JOHNSON K. FONG Director
- -----------------------------------------------
Johnson K. Fong
</TABLE>
II-5
<PAGE> 80
INDEPENDENT AUDITORS' REPORT
To the Shareholders and Board of Directors of
Flour City International, Inc.
We have audited the financial statements of Flour City International, Inc.
as of October 31, 1997 and for the year then ended, and have issued our report
thereon dated December 5, 1997 (included elsewhere in this Registration
Statement). Our audit also included the financial statement schedule listed in
Item 16 of this Registration Statement. This financial statement schedule is the
responsibility of the Company's management. Our responsibility is to express an
opinion based on our audit. In our opinion, such financial statement schedule,
when considered in relation to the basic financial statements taken as a whole,
present fairly in all material respects the information set forth therein.
DELOITTE & TOUCHE LLP
Nashville, Tennessee
December 5, 1997
S-1
<PAGE> 81
INDEPENDENT AUDITORS' REPORT
To the Shareholders and Board of Directors of
Flour City Architectural Metals (Pacific) Ltd.
We have audited the financial statements of Flour City Architectural Metals
(Pacific) Ltd. as of October 31, 1995 and 1996 and for each of the two years in
the period ended October 31, 1996, and have issued our report thereon dated June
26, 1997 (included elsewhere in this Registration Statement). Our audits also
included the financial statement schedule listed in Item 16 of this Registration
Statement. This financial statement schedule is the responsibility of the
Company's management. Our responsibility is to express an opinion based on our
audits. In our opinion, such financial statement schedule, when considered in
relation to the basic financial statements taken as a whole, present fairly in
all material respects the information set forth therein.
DELOITTE TOUCHE TOHMATSU
Hong Kong
June 26, 1997
S-2
<PAGE> 82
SCHEDULE II
FLOUR CITY INTERNATIONAL, INC.
VALUATION AND QUALIFYING ACCOUNTS
THREE YEARS ENDED OCTOBER 31, 1997
<TABLE>
<CAPTION>
BALANCE BALANCE
AT AT
BEGINNING CHARGED TO CHARGED TO END
OF COSTS AND OTHER OF
PERIOD EXPENSES ACCOUNTS DEDUCTIONS PERIOD
-------- ---------- ---------- -------- --------
<S> <C> <C> <C> <C> <C>
Year ended October 31, 1995:
Allowance for Uncollectible
Accounts included under balance
sheet caption "Accounts
receivable"....................... $ -- $ -- $ -- $ -- $ --
Year ended October 31, 1996:
Allowance for Uncollectible
Accounts included under balance
sheet caption "Accounts
receivable"....................... -- 153,846 -- -- 153,846
Year ended October 31, 1997:
Allowance for Uncollectible
Accounts included under balance
sheet caption "Accounts
receivable"....................... 153,846 623,779 -- -- 777,625
</TABLE>
S-3
<PAGE> 83
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER DESCRIPTION PAGE
- -------- ---------------------------------------------------------------------- -------------
<C> <S> <C>
*1.1 Form of Underwriting Agreement........................................
*3.1 Amended and Restated Articles of Incorporation of Flour City
International, Inc. ..................................................
3.2 Articles of Merger of International Forest Industries, Inc., and Flour
City International, Inc. .............................................
3.3 By-laws of Flour City International, Inc. ............................
*4.1 Underwriter's Warrant.................................................
*4.2 Form of Lock-Up Agreement
*5.1 Opinion of Manning Marder & Wolfe.....................................
10.1 Share Exchange Agreement between Flour City International, Inc. and
John W. Y. Tang, Gold Manor Limited, Dynamic Choice Enterprises and
Wilson International Limited dated January 17, 1997...................
10.2 Stock Purchase Agreement between Flour City International, Inc.,
Armco, Inc., and Flour City Architectural Metals, Inc., dated as of
January 1, 1997.......................................................
10.3 Agreement and Plan of Merger by and among Flour City International,
Inc. and International Forest Industries, Inc., dated as of April 4,
1997..................................................................
10.4 Flour City International, Inc. 1997 Stock Incentive Plan and Form of
Nonqualifed Stock Option Agreement....................................
10.5 Form of Indemnification Agreement.....................................
10.6 Employment Agreement between Flour City Architectural Metals, Inc. and
Michael J. Russo dated January 17, 1997...............................
10.7 Employment Agreement by and between Flour City Architectural Metals
(Asia) Limited and John W. Y. Tang dated December 15, 1997............
10.8 Ground and Building Lease Agreement dated December 20, 1993, Consent
and Assumption of Lease dated May 27, 1997............................
10.9 Lease Agreement between Douglas Dynamics, LLC and Flour City
Architectural Metals, Inc. dated as of January 1, 1997................
10.10 Asset Transfer Agreement between Flour City Architectural Metals,
Inc., and Douglas Dynamics, LLC dated as of January 1, 1996...........
10.11 Manufacturing Agreement between Flour City Architectural Metals, Inc.,
and Douglas Dynamics, LLC dated as of January 1, 1997.................
**10.12 Agreement between Flour City Architectural Metals, Inc., and Turner
Construction Company dated December 4, 1996...........................
**10.13 Purchase Order #32895-1243 for U.C. Davis Medical Center in
Sacramento, California................................................
**10.14 Trade Contract between Swiss Re Investors, Inc., and Flour City
Architectural Metals, Inc., dated May 19, 1997........................
11.1 Flour City International, Inc. Earnings Per Share.....................
21.1 List of subsidiaries (See "The Company" in Part I of the Registration
Statement)............................................................
23.1 Consent of Deloitte & Touche LLP......................................
23.2 Consent of Deloitte Touche Tohmatsu...................................
*23.3 Consent of Manning Marder & Wolfe (included in Exhibit 5.1)...........
24.1 Power of Attorney (see signature page)................................
27.1 Financial Data Schedule...............................................
</TABLE>
- ---------------
* To be filed by amendment
** Confidential treatment requested
<PAGE> 1
EXHIBIT 3.2
ARTICLES OF MERGER
OF
INTERNATIONAL FOREST INDUSTRIES, INC.
AND
FLOUR CITY INTERNATIONAL, INC.
To the Secretary of State
State of Nevada
Pursuant to the provisions of Chapter 78, Nevada Revised Statues, the
constituent domestic corporations herein named do hereby submit the following
Articles of Merger.
1. Annexed hereto and made a part hereof is the Plan of Merger for
merging Flour City International, Inc. ("FCI"), a business corporation organized
and existing under the laws of the State of Nevada, with and into International
Forest Industries, Inc. ("IFI"), a business corporation organized and existing
under the laws of the State of Nevada. The said Plan of Merger has been adopted
by the Board of Directors of FCI and by the Board of Directors of IFI.
2. The said Plan of Merger was submitted to the stockholders of IFI by
its Board of Directors pursuant to the provisions of Chapter 78, Nevada Revised
Statutes, and the manner of approval thereof by said stockholders was as
follows:
(i) The designation, the number of outstanding shares, and the
number of votes entitled to be cast by each class entitled to vote on the said
Plan of Merger are as follows:
(a) Designation of class: Common;
(b) Number of outstanding shares of class: 25,360,000;
and
(c) Number of votes of class entitled to be cast:
25,360,000.
(ii) The total number of votes cast for and against the merger
herein provided for by each class entitled to vote on the said Plan of Merger is
as follows:
(a) Designation of class: Common;
(b) Number of votes of class cast for Plan of Merger:
22,461,747; and
<PAGE> 2
(c) Number of votes of class cast against Plan of
Merger: -0-.
(iii) The total number of undisputed votes cast for the merger
herein provided for by each class entitled to vote on the said Plan of Merger is
as follows:
(a) Designation of class: Common;
(b) Undisputed votes of class cast for Plan of Merger:
22,461,747.
(iv) The said number of votes cast for the said Plan of Merger
was sufficient for the approval thereof by the said class.
3. The said Plan of Merger was approved by the unanimous consent of the
stockholders of FCI pursuant to the provisions of Chapter 78, Nevada Revised
Statutes.
4. When the merger herein provided for becomes effective, Articles I,
III, IV, VI, VIII, X and XIII of the Articles of Incorporation of IFI are
amended pursuant to the annexed Plan of Merger to read as follows:
ARTICLE I
NAME. The name of the corporation is Flour City International, Inc.
ARTICLE III
PURPOSE. The purpose of this corporation is to engage in any lawful act
or activity for which a corporation may be organized under the Nevada Business
Corporation Act other than the banking business or the trust company business.
ARTICLE IV
CAPITALIZATION. A. Number and Par Value of Shares. The Corporation is
authorized to issue fifty million (50,000,000) shares of common stock with a par
value of one hundredth of a cent ($.0001 ) per share. All of the shares of
common stock shall be of the same class, without preference or distinction. The
Corporation is authorized to issue five million (5,000,000) shares of preferred
stock with a par value of one hundredth of a cent ($.0001 ) per share.
B. Preferred Stock. The preferred stock may be issued in one or more
series. The Board of Directors is authorized to fix the number of any such
series of preferred shares, and to determine the designation of any such series.
The Board of Directors is further authorized to determine or alter the rights,
preferences, privileges and restrictions granted to or imposed upon any wholly
and issued series of preferred shares, and within the limits and restrictions
stated in any resolution or resolutions of the Board of Directors originally
fixing the number of shares constituting any series, to increase or decrease
(but not below the number of shares of such series then outstanding) the number
of shares of any such series subsequent to the issue of shares of that series.
<PAGE> 3
C. Assessment of Shares. The capital stock of the Corporation, after the
amount of the consideration for the issuance of shares, as determined by the
Board of Directors, has been paid, is not subject to assessment to pay the debts
of the Corporation and no stock issued as fully paid may ever be assessed, and
the Articles of Incorporation cannot be amended in this respect.
D. Cumulative Voting. Cumulative voting by any shareholder is denied.
ARTICLE VI
BYLAWS. Provisions for the regulation of the internal affairs of the
corporation shall be set forth in the Bylaws. Bylaws may be adopted, amended or
repealed by the Board of Directors.
ARTICLE VIII
REGISTERED OFFICE AND RESIDENT AGENT. The address of the Corporation's
registered office is 502 East John Street, Carson City, Nevada 89706. The name
of the resident agent is CSC Services of Nevada, Inc. The address of the
resident agent is 502 East John Street, Carson City, Nevada 89706.
ARTICLE X
AMENDMENT TO ARTICLES OF INCORPORATION. These Articles of Incorporation
may be amended only in accordance with Nevada Revised Statute 78.390.
ARTICLE XIII
DIRECTORS' AND OFFICERS' LIABILITY. The corporation shall indemnify to
the fullest extent permitted by law any person made or threatened to be made a
party to any action or proceeding, whether criminal, civil, administrative or
investigative, by reason of the fact that he, his testator or intestate is or
was a director or officer of the corporation or any predecessor of the
corporation or serves or served any other enterprise as a director or officer at
the request of the corporation or any predecessor of the corporation. No
amendment or repeal of this Article XIII applies to or has any affect on the
liability or alleged liability of any director or officer of this corporation
for or with respect to any acts or omissions of the director or officer
occurring prior to the amendment or repeal, except as otherwise required by law.
5. The merger herein provided for shall become effective in the State of
Nevada on the date these Articles of Merger are Filed with the Secretary of
State.
<PAGE> 4
INTERNATIONAL FOREST INDUSTRIES, INC.
/s/ ANDREW W. BERNEY Dated: April 30, 1997
- ------------------------------------
President
/s/ BRUCE BARTON Dated: April 30, 1997
- ------------------------------------
Secretary
FLOUR CITY INTERNATIONAL, INC.
[SIG] Dated: April 30, 1997
- ------------------------------------
President
[SIG] Dated: April 30, 1997
- ------------------------------------
Assistant Secretary
<PAGE> 5
STATE OF NEVADA )
) SS.:
COUNTY OF CLARK )
On April 30, 1997, personally appeared before me, a Notary Public in and
for the State and County aforesaid, Andrew W. Berney, and Bruce Barton,
President and Secretary of International Forest Industries, Inc., personally
known to me, or demonstrated to me on the basis of satisfactory evidence, to be
the persons whose names are subscribed to the above instrument in the said
capacities, who acknowledged that they executed the said instrument.
/s/ [SIG]
------------------------------
Notary Public
<PAGE> 6
STATE OF TENNESSEE )
) SS.:
COUNTY OF WASHINGTON )
On April 30, 1997, personally appeared before me, a Notary Public in and
for the State and County aforesaid, Mike Russo, and Bryan R. Willis,
President and Assistant Secretary of Flour City International, Inc., personally
known to me, or demonstrated to me on the basis of satisfactory evidence, to be
the persons whose names are subscribed to the above instrument in the said
capacities, who acknowledged that they executed the said instrument.
/s/ [SIG]
------------------------------
Notary Public
<PAGE> 7
EXHIBIT A
PLAN OF MERGER
Plan of Merger (the "Plan") entered into on April ___, 1997 by and
between International Forest Industries, Inc., a Nevada corporation ("IFI"), and
Flour City International, Inc., a Nevada corporation ("FCI").
The respective boards of directors of IFI and FCI have approved the
merger (the "Merger") of IFI and FCI upon the terms and subject to the
conditions set forth in the Agreement and Plan of Merger (the "Agreement of
Merger") entered into on April ___, 1997 by and among FCI and IFI.
Now, therefore, IFI and FCI hereby agree as follows:
ARTICLE 1
MERGER
At the Effective Time (as hereinafter defined), FCI shall merge with and
into IFI, with IFI to be the corporation surviving the Merger (the "Surviving
Corporation").
ARTICLE 2
EFFECTIVE DATE
The Merger shall become effective at the time (the "Effective Time") FCI
and IFI shall file an executed counterpart of this Agreement, together with
Articles of Merger and all requisite accompanying certificates, with the
Secretary of State of the State of Nevada. At the Effective Time, the separate
existence of FCI shall cease and the effect of the Merger shall in all other
respects be as provided herein. The Surviving Corporation may, at any time after
the Effective Time, take any action (including executing and delivering any
document) in the name and on behalf of FCI or IFI in order to carry out and
effectuate the transactions contemplated by this Plan.
ARTICLE 3
ARTICLES, BY-LAWS AND BOARD OF DIRECTORS
3.1 Articles of Incorporation. The Articles of Incorporation of the
Surviving Corporation when the Merger becomes effective shall be the Articles of
Incorporation of said Surviving Corporation, except that Articles I, III, IV,
VI, VIII, X and XIII thereof, relating to the name of the corporation, the
purposes of the corporation, the capitalization of the corporation, the bylaws
of the corporation, the registered office and agent of the corporation,
amendment of the Articles of Incorporation of the corporation and
indemnification of directors and officers of the corporation, are hereby amended
and changed so as to read as follows when the merger becomes effective:
<PAGE> 8
ARTICLE I
NAME. The name of the corporation is Flour City International, Inc.
ARTICLE III
PURPOSE. The purpose of this corporation is to engage in any lawful act
or activity for which a corporation may be organized under the Nevada Business
Corporation Act other than the banking business or the trust company business.
ARTICLE IV
CAPITALIZATION. A. Number and Par Value of Shares. The Corporation is
authorized to issue fifty million (50,000,000) shares of common stock with a par
value of one hundredth of a cent ($.0001 ) per share. All of the shares of
common stock shall be of the same class, without preference or distinction. The
Corporation is authorized to issue five million (5,000,000) shares of preferred
stock with a par value of one hundredth of a cent ($.0001 ) per share.
B. Preferred Stock. The preferred stock may be issued in one or more
series. The Board of Directors is authorized to fix the number of any such
series of preferred shares, and to determine the designation of any such series.
The Board of Directors is further authorized to determine or alter the rights,
preferences, privileges and restrictions granted to or imposed upon any wholly
and issued series of preferred shares, and within the limits and restrictions
stated in any resolution or resolutions of the Board of Directors originally
fixing the number of shares constituting any series, to increase or decrease
(but not below the number of shares of such series then outstanding) the number
of shares of any such series subsequent to the issue of shares of that series.
C. Assessment of Shares. The capital stock of the Corporation, after the
amount of the consideration for the issuance of shares, as determined by the
Board of Directors, has been paid, is not subject to assessment to pay the debts
of the Corporation and no stock issued as fully paid may ever be assessed, and
the Articles of Incorporation cannot be amended in this respect.
D. Cumulative Voting. Cumulative voting by any shareholder is denied.
ARTICLE VI
BYLAWS. Provisions for the regulation of the internal affairs of the
corporation shall be set forth in the Bylaws. Bylaws may be adopted, amended or
repealed by the Board of Directors.
ARTICLE VIII
REGISTERED OFFICE AND RESIDENT AGENT. The address of the Corporation's
registered office is 502 East John Street, Carson City, Nevada 89706. The name
of the resident
2
<PAGE> 9
agent is CSC Services of Nevada, Inc. The address of the resident agent is 502
East John Street, Carson City, Nevada 89706.
ARTICLE X
AMENDMENT TO ARTICLES OF INCORPORATION. These Articles of Incorporation
may be amended only in accordance with Nevada Revised Statute 78.390.
ARTICLE XIII
DIRECTORS' AND OFFICERS' LIABILITY. The corporation shall indemnify to
the fullest extent permitted by law any person made or threatened to be made a
party to any action or proceeding, whether criminal, civil, administrative or
investigative, by reason of the fact that he, his testator or intestate is or
was a director or officer of the corporation or any predecessor of the
corporation or serves or served any other enterprise as a director or officer at
the request of the corporation or any predecessor of the corporation. No
amendment or repeal of this Article XIII applies to or has any affect on the
liability or alleged liability of any director or officer of this corporation
for or with respect to any acts or omissions of the director or officer
occurring prior to the amendment or repeal, except as otherwise required by law.
3.2 By-Laws. The By-Laws of FCI as in effect immediately prior to the
Effective Time shall be the By-Laws of the Surviving Corporation until further
amended in accordance with the provisions thereof and of the Articles of
Incorporation of the Surviving Corporation.
3.3 Directors and Officers.
(a) The Board of Directors of the Surviving Corporation from and
after the Effective Time shall consist of the persons who are members of the
Board of Directors of FCI as of the Effective Time. Such directors shall serve
until their resignation, removal or failure to be reelected and until their
respective successors are duly elected or appointed and qualified in accordance
with the Articles of Incorporation and By-Laws of the Surviving Corporation.
(b) The persons who are officers of FCI as of the Effective Time
shall continue in the same capacity as officers of the Surviving Corporation
until the Board of Directors of the Surviving Corporation shall otherwise
determine. Other persons may be elected or appointed to other offices from time
to time in accordance with the By-Laws of the Surviving Corporation.
ARTICLE 4
CONVERSION OF SHARES
4.1 Conversion of Capital Stock of the Company. At and as of the
Effective Time, each outstanding share of common stock of FCI ("FCI Common
Stock") shall be converted into
3
<PAGE> 10
2.7980667 shares of common stock, $.0001 par value of IFI ("IFI Common Stock") .
No share of FCI Common Stock shall be deemed to be outstanding or to have any
rights after the Effective Time other than the right to receive the foregoing
payment of IFI Common Stock.
4.2 No Fractional Shares. No Fractional share of IFI Common Stock shall
be issued.
ARTICLE 5
TERMINATION
This Agreement may be terminated at any time prior to the Effective Time
(whether before or after shareholder approval) by the mutual written agreement
of FCI and IFI. This Agreement shall automatically be void and of no further
force and effect if, prior to the Effective Time, the Agreement of Merger is
terminated in accordance with the terms thereof.
ARTICLE 6
CHOICE OF LAW
The validity, interpretation and performance of this Agreement shall be
controlled by and construed under the laws of the State of Nevada.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed on its behalf by its duly authorized officers all as of the day and
year first above written.
INTERNATIONAL FOREST INDUSTRIES, INC.
By: _____________________________
Name: _____________________________
Title: _____________________________
FLOUR CITY INTERNATIONAL, INC.
By: _____________________________
Name: _____________________________
Title: _____________________________
4
<PAGE> 1
EXHIBIT 3.3
BYLAWS OF
FLOUR CITY INTERNATIONAL, INC.
A Nevada Corporation
<PAGE> 2
TABLE OF CONTENTS OF THE BYLAWS OF
FLOUR CITY INTERNATIONAL, INC.
<TABLE>
<S> <C>
ARTICLE 1....................................................................................1
Section 1.01. Name..................................................................1
Section 1.02. Registered Office and Resident Agent..................................1
Section 1.03. Other Offices.........................................................1
Section 1.04. Seal..................................................................1
Section 1.05. Fiscal Year............................................................1
ARTICLE 2....................................................................................1
Section 2.01. Consideration for Shares..............................................1
Section 2.02. Payment for Shares....................................................1
Section 2.03. Certificates Represented Shares.......................................2
Section 2.04. Transfer of Stock.....................................................2
(a) Endorsement.....................................................................2
(b) Witnessing.......................................................................2
(c) Adverse Claims...................................................................2
(d) Taxes ...........................................................................2
ARTICLE 3....................................................................................2
Section 3.01. Location of Shareholder Meetings......................................2
Section 3.02. Annual Shareholder Meetings...........................................2
Section 3.03. Special Shareholder Meetings..........................................3
Section 3.04. Notice of Shareholder Meetings........................................3
Section 3.05. Shareholder Quorum....................................................3
Section 3.06. Adjourned Shareholder Meetings........................................3
Section 3.07. Entry of Notice.......................................................4
Section 3.08. Voting................................................................4
Section 3.09. Consent of Absentees..................................................4
Section 3.10. Action Without A Meeting..............................................4
Section 3.11. Proxies...............................................................4
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
Section 3.12. Definition of "Shareholder"...........................................5
ARTICLE 4....................................................................................5
Section 4.01. Number of Directors...................................................5
-------------------
Section 4.02. Increase or Decrease Of Directors.....................................5
---------------------------------
Section 4.03. Election..............................................................5
--------
Section 4.04. Vacancies.............................................................5
---------
Section 4.05. Annual Meeting........................................................6
--------------
Section 4.06. Regular Meetings......................................................6
----------------
Section 4.07. Other Meetings........................................................6
--------------
Section 4.08. Notice of Adjourned Meetings..........................................7
----------------------------
Section 4.09. Entry of Notice.......................................................7
---------------
Section 4.10. Waiver of Notice......................................................7
----------------
Section 4.11. Quorum................................................................7
------
Section 4.12. Adjournment...........................................................7
-----------
Section 4.13. Action Without Meeting................................................7
----------------------
Section 4.14. Fees and Compensation.................................................7
---------------------
Section 4.15. Indemnification.......................................................8
---------------
Section 4.16. Power of Directors....................................................9
------------------
ARTICLE 5...................................................................................11
Section 5.01. Officers.............................................................11
--------
Section 5.02. Election.............................................................11
--------
Section 5.03. Subordinate Officers.................................................12
--------------------
Section 5.04. Removal and Resignation..............................................12
-----------------------
Section 5.05. Vacancies............................................................12
---------
Section 5.06. President............................................................12
---------
Section 5.07. Vice President.......................................................12
--------------
Section 5.08. Secretary............................................................12
---------
Section 5.09. Treasurer............................................................13
---------
Section 5.10. Corporate Bank Accounts..............................................13
-----------------------
Section 5.11. Transfers of Authority...............................................14
----------------------
ARTICLE 6...................................................................................14
Section 6.01. Record Date and Closing Stock Books..................................14
-----------------------------------
Section 6.02. Inspection of Corporate Records......................................14
-------------------------------
Section 6.03. Drafts...............................................................14
------
Section 6.04. Execution of Contract................................................15
---------------------
Section 6.05. Certificates of Stock................................................15
---------------------
Section 6.06. Lost Certificates of Stock...........................................15
--------------------------
</TABLE>
<PAGE> 4
<TABLE>
<S> <C>
Section 6.07. Representation of Shares.............................................16
Section 6.08. Inspection of Bylaws.................................................16
ARTICLE 7...................................................................................16
Section 7.01. Power of Shareholders................................................16
Section 7.02. Power of Directors...................................................16
</TABLE>
<PAGE> 5
BYLAWS
OF
FLOUR CITY INTERNATIONAL, INCORPORATED
ARTICLE 1
IDENTIFICATION
Section 1.01. Name. The name of the corporation is Flour City
International, Inc. (the "Corporation").
Section 1.02. Registered Office and Resident Agent. The address of the
registered office of Flour City International, Inc. is 502 East John Street,
Carson City, Nevada 89706, and the name of the resident agent at this address is
CSC Services of Nevada, Inc.
Section 1.03. Other Offices. The principal business office of the
Corporation shall be established by the Board of Directors and insubordinate
offices may be established by the Board of Directors.
Section 1.04. Fiscal Year. The fiscal year of the Corporation will be
determined by resolution of the Board of Directors.
ARTICLE 2
STOCK
Section 2.02. Consideration for Shares. The capital stock may be issued
for such consideration, expressed in dollars, and shall be fixed from time to
time by the Board of Directors. Treasury shares may be disposed of by the
Corporation for such consideration, expressed in dollars, as may be fixed from
time to time by the Board of Directors.
Section 2.02. Payment for Shares. The consideration for the issuance of
shares may be paid, in whole or in part, in the form of any tangible or
intangible property or benefit to the Corporation. When the Corporation receives
consideration for which the Board of Directors authorized the issuance of
shares, the shares issued therefore are fully paid and non-assessable. The
judgement of the Board of Directors concerning the adequacy of consideration
received for shares shall be conclusive as to all except then-existing
shareholders for whom it shall be conclusive in the absence of actual fraud in
the transaction. No certificate shall be issued for any share until the share is
fully paid.
1
<PAGE> 6
Section 2.03. Certificates Representing Shares. Each holder of the
capital stock of the Corporation is entitled to a certificate signed by the
president and the secretary certifying the number of shares owned by the
shareholder in the Corporation.
Section 2.04. Transfer of Stock. The Corporation will register a
transfer of a stock certificate presented to it for transferring if the
following conditions have been fulfilled:
(a) Endorsement. The certificate is properly endorsed by the registered
shareholder or by the shareholder's duly authorized agent;
(b) Witnessing. The endorsement or endorsements are witnessed by one
witness unless this requirement is waived by the secretary;
(c) Adverse Claims. The Corporation has no notice of any adverse claims
or has discharged its duty to inquire into any adverse claims; and
(d) Collection of Taxes. There has been compliance with any applicable
law related to the collection of taxes.
ARTICLE 3
THE SHAREHOLDERS
Section 3.01. Location of Shareholder Meetings. The meetings of the
shareholders of the Corporation shall be held at 915 Riverview Drive, Johnson
City, Tennessee 37601, or at such other places may be designated by the
president or the Board of Directors, or by the written consent of a majority of
the shareholders entitled to vote at the meeting given either before or after
the meeting and filed with the minutes of the proceedings of the shareholders.
Section 3.02. Annual Shareholder Meetings. Unless a written consent of a
majority of the shareholders entitled to vote at the annual meeting is filed
with the secretary in lieu of an annual meeting, the annual shareholders'
meeting shall be held at 10:00 a.m. on the Monday of the second week of February
at 915 Riverview Drive, Johnson City, Tennessee 37601, if the day is not a legal
holiday, and if a holiday, that on the first following day that is not a legal
holiday. In the event the annual shareholder's meeting is not held at such time,
the Board of Directors, the chairman of the Board of Directors, the president or
shareholders holding not less than the majority of the shares entitled to vote
at the meeting may call and give notice of the time and place of the annual
meeting. The failure to hold the annual meeting or file the written consent in
lieu thereof will not cause a forfeiture or disillusion of the Corporation.
2
<PAGE> 7
Section 3.03. Special Shareholder Meetings. Special shareholders'
meetings may be called by the Board of Directors, the chairman of the Board of
Directors, the president of shareholders holding not less than he majority of
all the shares entitled to vote at the meeting.
Section 3.04. Notice of Shareholder Meetings. Written notice stating the
place, day, and hour of a shareholders' meeting and, in the case of a special
meeting, the purpose or purposes for which the meeting is called, must be
delivered not less than fourteen (14) days, no more than twenty-eight (28) days
before the day of the meeting, either personally, or by mail, or by other means
of written communication, charges prepaid, by or at the direction of the
president, the secretary, or the officer or persons calling the meeting, to each
registered shareholder entitled to vote at the meeting. If mailed, the notice
shall be considered to be delivered when deposited in the United States Mail
addressed to the shareholder at the shareholder's address as it appears on the
stock transfer book of the Corporation, with postage prepaid. If the shareholder
gives no address, notice shall be deemed to have been given to the shareholder
if sent by mail or if the written communication addressed to the place where the
Corporations' registered office is located, or if published at least once in
some newspaper of general circulation in the county in which the Corporation's
registered office is located. Where notice is required to be given and notice of
two (2) previous consecutive annual meetings or notices at meetings or notice of
taking of action without a meeting by written consent have been mailed and
addressed to a shareholder at the address as shown on the records of the
Corporation and have been returned as undeliverable, the given of a further
notice to the shareholder is not required. Waiver by a shareholder in writing of
notice of the meeting, is equivalent to given notice. Attendance by a
shareholder, without objection to the notice, whether in person or by proxy, at
a meeting is a waiver of notice of the meeting.
Section 3.05. Shareholder Quorum. A majority of the shares entitled to
vote, represented in person or by proxy, is a quorum at a shareholders' meeting.
A shareholder may participate in a meeting of shareholders by means of a
telephone conference or similar method of communication by which all persons
participating in the meeting can hear each other and such participation shall
constitute presence at the meeting. A shareholder's meeting commenced with a
quorum may continue to do business until an adjournment, notwithstanding the
withdrawal of a shareholder to leave less than a quorum.
Section 3.06. Adjourned Shareholder Meetings. Any shareholders' meeting,
whether annual or special, whether or not a quorum is present, may be adjourned
from time to time by the vote of a majority of the shares, the holders of which
are either present in person or represented by proxy, but in the absence of the
quorum no other business may be transacted at any shareholders' meeting. When
any shareholders meeting, either annual or special, is adjourned, notice of the
adjourned meeting shall be given as in the case of an original meeting.
3
<PAGE> 8
Section 3.07. Entry of Notice. An entry in the minutes of any meeting of
shareholders, whether annual or special, to the effect that notice has been duly
given shall be conclusive and incontrovertible evidence that the requisite
notice of the meeting was given to all shareholders as required by law and the
Bylaws.
Section 3.08. In Voting. Except as otherwise provided by law, only
persons and whose names shares entitled to withstand on the stock registry of
the Corporation on the day prior to any shareholders' meeting, or, if a record
date for voting purposes is fixed as provided in Article 6, Section 6.01, of
these Bylaws, then on that record date, shall be entitled to vote at the
meeting. Voting may be by a role call or by ballot; provided, however, that all
elections for directors must be by a ballot upon demand by a shareholder at any
election and before the voting begins. Except as otherwise provided by law or by
an expressed provision of the Articles of the Incorporation or of any Directors'
Resolution for a series of Preferred Stock, each share is entitled to one vote,
when a quorum is present at the commencement of any shareholders' meeting, the
vote of the holders of the majority of the shares entitled to vote present, in
person or by proxy, shall decide any question brought before the shareholders'
meeting. The fractional shares shall not be entitled to any voting rights
whatsoever.
Section 3.09. Consent of Absentees. The transactions of any
shareholders' meeting, either annual or special and however called to notice,
shall be as valid as though had in a meeting duly held after regular call and
notice if a quorum be present either in person or by proxy and if, either before
or after the meeting, each of the shareholders entitled to vote, not present in
person or by proxy, signs a written waiver of notice, or consent to the holding
of the meeting, or an approval of the minutes thereof, all such waivers,
consents or approvals shall be filed with a Secretary or be made part of the
minutes of the meeting.
Section 3.10. Action Without a Meeting. Any action which, under
applicable provisions of law, may be taken or ratified in a meeting of the
shareholders, may be taken or ratified without a meeting if authorized in
writing by shareholders holding a majority of the voting power, except that if
any greater proportion of voting power is required for such an action at a
meeting, in the greater proportion if written consent is required. A meeting of
the shareholders need not be called or noticed if action is taken by written
consent. The shareholders entitled to sign the written consent shall be
determined as of the earliest date that a shareholder signs the written consent.
All written consents shall be filed with the minutes of the proceedings of the
shareholders.
Section 3.11. Proxies. Every person entitled to vote or execute consents
shall have the right to do so either in person or by an agent or agents
authorized by a written proxy executed by the person or by the persons' dully
authorized agent and filed with the Secretary of the Corporation; provided that
no proxy shall be valid after the expiration of twelve (12) months from the date
of its execution unless the person executed had specified therein the length of
time for which the proxy is continued in force, which in no event shall exceed
two (2) years from the date of its execution.
4
<PAGE> 9
Section 3.12. Definition of "Shareholder". As used in these Bylaws, the
term "Shareholder", in any term of like import, shall include all persons
entitled to vote the shares held by a shareholder, unless the context in which
the term is used indicates that a different meaning is intended.
ARTICLE 4
THE BOARD OF DIRECTORS
Section 4.01. Number of Directors. The number of directors shall be
fixed from time to time exclusively by the Board of Directors pursuant to a
resolution adopted by a majority of the total number of authorized directors
(whether or not there exits any vacancies in previously authorized directorships
at the time any such resolution is presented to the Board for adoption) but the
number shall be not less than one (1) nor more than fifteen (15). The members of
the Board of Directors need not be shareholders.
Section 4.02. Increase or Decrease of Directors. The minimum or maximum
number of directors may be increased or decreased from time to time, and a
meeting of the shareholders, by the affirmative vote of a majority of the issued
and outstanding shares of the Stock of the Corporation. This Section of the
Bylaws may be amended only the by the affirmative vote, at a meeting of the
shareholders, of two-thirds (2/3) of the issued and outstanding shares of the
Capital Stock of the Corporation or by a written consent sign by all of the
shareholders.
Section 4.03. Election. Members of the initial Board of Directors shall
hold office until the first annual shareholders' meeting or until their
successor shall have been elected and qualified. At the first annual
shareholder's meeting and at each annual meeting thereafter, or by a written
consent filed in lieu of an annual meeting, the shareholders shall elect
Directors to hold office until the time for the next succeeding annual meeting.
If any annual shareholders' meeting is not held and a written consent in lieu of
an annual meeting is not filed, or if the Directors are not elected, the
Directors may be elected at any special shareholders' meeting held for that
purpose or the filing of a special written consent. Each Directors shall hold
office for the term for which the Director is elected or until the Director's
successor shall be elected and qualified.
Section 4.04. Vacancies. Any vacancy occurring in the Board of Directors
may be filled by the affirmative vote of a majority of the remaining Directors
though less than quorum of the Board of Directors was present, or by a sole
remaining Director. A Director elected to fill a vacancy shall be elected for
the unexpired term of the Director's predecessors in an office. A vacancy or
vacancies in the Board of Directors shall be deemed to exist in the case of the
death, a resignation or removal of any Directors, or if the authorized number of
Directors being increased, or if the shareholders fail at any annual or special
meeting of shareholders at which any Director or Directors are elected to elect
the full authorized number of Directors to be voted for that meeting, or if a
vacancy is declared by the Board of Directors for any reason permitted by law.
The shareholders may elect a Director or Directors at any time to fill any
vacancy or vacancies
5
<PAGE> 10
not filled by the Board of Directors. If the Board of Directors accepts the
resignation of a Director tendered to take effect at a future time, the Board of
Directors shall have power to elect a successor to take office when the
resignation is to become effective. No reduction of the authorized number of
Directors shall have the effect of removing any Director prior to the expiration
of the Director's term of office.
Section 4.05. Annual Meeting. Immediately after the annual meeting of
the shareholders, at the same place as the meeting of the shareholders or such
other places may be provided in a notice thereof, the Board of Directors shall
meet each year for the purpose of organization, election of officers, and
consideration of any other business that may properly be brought before that
meeting. No notice of any kind to either old or new members of the Board of
Directors for this annual meeting shall be necessary unless the meeting is to be
held at a place other than the place of the meeting of the shareholders, in
which case notice of the place of the meeting shall be given as provided in
Section 4.07.
Section 4.06. Regular Meetings. Regular meetings of the Board of
Directors shall be held at time and places within or without the State of Nevada
as may be designated from time to time by resolution of the Board of Directors
or by a written consent of all members of the Board of Directors. No notice of
any kind to members of the Board of Directors for these regular meetings shall
be necessary unless the meeting is to be held at a place other than the
principal business office of the Corporation, in which case notice of a place of
the meeting shall be given as provided in Section 4.07.
Section 4.07. Other Meetings. Other meetings of the Board of Directors
for any purpose or purposes may be held at anytime upon call by the president
or, if the president is absent and unable for refuses of act, by any one (1)
Director. The other meetings may be held at any place within or without the
State of Nevada as may be designated from time to time by resolution of the
Board of Directors or by written consent of all Directors. Written notice of the
time and place of other meetings shall be delivered personally to each Director
or sent to each Director by mail or by other form of written communication,
charged prepaid, addressed to the Director at the Director's address as a shown
upon the records of the Corporation or, if it is not so shown on the
Corporation's records or is not readily ascertainable, at the place in which the
meetings of the Directors are regularly held. In case the notice is mailed or
telegraph, it shall be deposited in the United States Mail or delivered to the
telegraph company in the place in which the principal business office or the
Corporation is located at least fourteen (14) days prior to the holding of the
meeting. In case the notice is delivered personally as above provided, it shall
be delivered at least ten (10) days prior to the time of the holding of the
meeting. The mailing, telegraph, and/or delivery as above provided shall
constitute due, legal and personal notice to the Director.
Section 4.08. Notice of Adjourned Meetings. Notice of the time and place
of the holding an adjourned meeting need not be given to absent Directors.
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Section 4.09. Entry of Notice. An entry in the minutes of any special
meeting of the Board of Directors to the effect that notice has been duly given
shall be conclusive and incontrovertible evidence that due notice of the special
meeting was given to all Directors as required by law and these Bylaws.
Section 4.10. Waiver of Notice. The transactions of any meeting of the
Board of Directors, however, called to notice or wherever held, shall be valid
as though had at a meeting duly held after regular call and notice, if a quorum
be present, and if, either before or after the meeting, each of the Directors
not present signs a written waiver of notice or a consent to the holding of the
meeting or approval of the minutes thereof. All such waivers, consents or
approvals shall be filed with the Corporate records and made a part of the
minutes of the meeting.
Section 4.11. Quorum. A majority of the authorized number of Directors,
or, in the event that a flexible number of Directors is authorized by the
Article of a Corporation or these Bylaws, a majority of the exact authorized
number of Directors, shall be necessary to constitute a quorum for the
transaction of business, except to adjourn herein after provided. Every act or
decision done or made by a majority of the Directors present at a meeting duly
held at which a quorum is present shall be regarded as the act of the Board of
Directors unless a greater number be required by the Articles of a Corporation,
these Bylaws are applicable law. If the number of Directors is one or two, the
unanimous consent of the Directors shall be necessary for Board of Directors'
action.
Section 4.12. Adjournment. A quorum of the Directors may adjourn any
Directors' meeting to meet again at a stated date and hour, provided, that in
the absence of a quorum, a majority of the Directors present at any Directors'
meeting either regular or special, may adjourn from time to time until the time
fixed for the next regular meeting of the Board of Directors.
Section 4.13. Action Without Meeting. Any action required or permitted
to be taken by the Board of Directors under the Articles of Incorporation, these
Bylaws, or under applicable law, may be taken without a meeting if all members
of the Board of Directors shall individually or collectively consent, in
writing, before or after the action, to the action. Any action by written
consent shall have the same force and effect as a unanimous vote of all
Directors. All written consents must be filed with the Secretary.
Section 4.14. Fees and Compensation. Directors shall not receive any
stated salary for their service as Directors or as members of committees, but,
by resolution of the Board of Directors, a fixed fee, with or without expenses
of attendance, may be allowed to Directors for the Director's services. Nothing
herein contained shall be construed to preclude any Director from serving the
Corporation in any other capacity as an officer, agent, employee, or otherwise,
and receiving compensation therefore.
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Section 4.15. Indemnification.
(a) The Corporation shall indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Corporation) by reason of the
fact that the person is or was a Director, office, employee or agent of the
Corporation, or is or was serving at the request of the Corporation as a
Director, officer, employer or agent of another Corporation, partnership, joint
venture, trust or other enterprise, against expenses, including attorneys' fees,
judgments, fines in amounts paid or in a settlement actually or reasonably paid
or incurred by the person in connection with such action, suit or proceeding if
the person acted in good faith and in a manner the person reasonably believed to
be in or not opposed to the best interest of the Corporation, and with respect
to any criminal action or proceeding, had no reasonable cause to believe the
person's conduct was unlawful. The termination of any action, suit or proceeding
by judgment, order, settlement, conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself, create a presumption that the person did
not act in good faith and in a manner which the person reasonably believed to be
in or not opposed to the best interest of the Corporation, or, with respect to
any criminal action or proceeding, had a reasonable cause to believe that the
person's conduct was unlawful.
(b) The Corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Corporation to procure a judgment in its favor by
reason of a fact that the person is or was a Director, office, employee or agent
of the Corporation, or is or was serving at the request of the Corporation as
Director, office, employee or agent of another Corporation, partnership, joint
venture, trust or other enterprise against expenses, including attorneys' fees,
actually and reasonably paid or incurred by the person in connection with the
defense or settlement of such action are sued if the person acted in good faith
and in manner he reasonably believed to be in or not opposed to the best
interest of the Corporation, provided however, that no indemnification shall be
made in respect of any claim, issue or matter to which such person shall have
been adjudged to be liable for a misfeasance or nonfeasance in the performance
of a person's duty to the Corporation unless and only to the extent that,
despite the adjudication of liability but in view of circumstances the case,
such person fairly and equitably merits indemnification.
(c) To the extent that a person may be entitled to indemnification by
the Corporation under the Section is or has been successful on the merits or
otherwise in defense of any action, suit or proceeding referred to in
subsections (a) and (b), wherein defense of any claim, issue or matter therein,
the person shall be indemnified against expenses, including attorneys' fees,
actually and reasonably paid or incurred by the person in connection therewith.
(d) Any indemnification under subsections (a) and (b), shall be made by
the Corporation only as authorized in this specific case upon a determination
that indemnification of the Director, officer, employee or agent is proper and
the circumstances because the person has met the applicable standard of conduct
set forth in subsections (a) or (b). Such determination shall be
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made (i) by the Board of the Directors by a majority vote of a quorum consisting
of Directors who are not parties to such action, suit or proceeding, or (ii) if
such a quorum is not obtainable or, even if obtainable, a quorum of
disinterested Directors so directs, either by independent legal counsel or in
written opinion, or as stockholders, or (iii) if required by law, the court in
which such action, suit or proceeding was brought or another court of competent
jurisdiction.
(e) Expenses incurred in defending a civil or criminal action, suit or
proceeding may be paid by the Corporation and in advance of the final
disposition of such action, suit or proceeding if such payment is authorized in
the manner provided in subsection (d) upon receipt of an undertaking by or on
behalf of the Director, officer, employer or agent to repay such amount unless
it shall ultimately be determined that the person is entitled to be indemnified
by the Corporation as authorized in this Section.
(f) The indemnification provided in this Section shall not be deemed
exclusive of any other rights to which those seeking indemnification may be
entitled under any Bylaw, agreement, vote of stockholders or disinterested
Directors or otherwise, both as to the action in the person's official capacity
and as to action in another capacity while holding such office.
(g) The Corporation shall have power to purchase and maintain insurance
on behalf of any person who is or was a director, an officer, employer or agent
or the Corporation, or is or was serving at the request of the Corporation as a
Director, officer, employer or agent of another Corporation, partnership, joint
venture, trust or other enterprise against any liability asserted against the
person and incurred by the person in any such capacity, or arising out of the
person's status of such, whether or not the Corporation would have the power to
indemnify the person against such liability under the provisions of this
Section.
(h) For purposes of this Section, references to the "Corporation"
include all constituent Corporations absorbed in a consolidation or merger so
that any person who is or was a director, officer, employer or agent of such a
constituent Corporation or is or was serving at the request of such constituent
Corporation as director, officer, employer or agent of another Corporation,
partnership, joint venture, trust or other enterprise shall stand in the same
position under the provisions of this Section with respect to the resulting or
surviving Corporation as a person would if the person had served the resulting
or surviving Corporation in the same capacity.
(i) The provisions of this Section shall apply to the estate, executors,
administrators, heirs, legatees or devises of a person entitled to
indemnification herein under and the term "person", where used in this Section
shall include the estate, executors, administrators, heirs, legatees, or devises
of such person.
Section 4.16. Power of Directors. Subject to limitations of the Articles
of Incorporation, of these Bylaws, and other applicable law as to action to be
authorized or improved by the shareholder and subject to the duties of Directors
as prescribed by these Bylaws, all Corporate power shall be exercised by or
under the authority of, and the business and affairs of the
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Corporation shall be controlled by, the Board of Directors. Without prejudice to
these general powers, but subject to the same limitations, it is hereby
expressly declared that the Director shall have the following powers:
(a) To select and remove all directors, agents, and employees of the
Corporation, prescribe such powers and duties for them as may be not
inconsistent with law, with articles of incorporation under these Bylaws, fix
their compensation, and require from them security for faithful service;
(b) To conduct, manage and control the affairs of the business of the
Corporation and to make such rules and regulations therefore not inconsistent
with the law, the articles of incorporation, and these Bylaws, as they may be
deem best;
(c) To change the registered office from one location to another within
the same county as provided in Article 1, Section 1.02, hereof; to fix and
locate from time to time one or more subsidiary offices of the Corporation,
within or without the State of Nevada as provided in Article 1, Section 1.03,
hereof; to designate any place within or without the State of Nevada for the
holding of any shareholders' meeting or meetings; and to adopt, make and use a
Corporate seal, and to prescribe the forms of certificates of stock, and to
alter the form of the seal and of the certificates from time to time, as in
their judgment they may deem best, provided the seal and the certificate shall
at all times comply with the provisions of the law;
(d) To borrow money and incur indebtedness for the purposes of the
Corporation, and a cause to be executed and delivered therefore, in a Corporate
name, promissory notes, bonds, debentures, deeds of trust, mortgages, pledges,
hypothecations or other evidences of debt and securities therefore;
(e) To authorize the issuance of shares of the capital stock of the
Corporation from time to time, upon such terms as may be lawful, in
consideration of money paid, labor done or services actually rendered, debts or
securities canceled, tangible or intangible property actually received or such
other consideration as may be authorized by law;
(f) To adopt and administer, or provide for the administration of,
employee stock purchase plans, employee stock option plans and any other plans
or arrangements whereby directors, officers, employees or agents of the
Corporation or any other entity may be entitled to acquire, authorized but
unissued treasury stock or other securities of the Corporation, upon such terms
and conditions as may from time to time be permitted by law;
(g) To appoint committees, and to delegate to such committees, any of
the powers and authority of the Board of Directors in the management of the
business and affairs to the Corporation, except the power to declare dividends
and to adopt, amend or repeal Bylaws. The Board of Directors shall have the
power to prescribe the manner in which proceedings of the
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committees shall be conducted. The committee shall keep regular minutes of the
their meetings and report the same to the Board of Directors when required. Each
committee must be composed of one (1) or more Directors;
(h) To lend money in furtherance of any other purposes of the
Corporation; to invest the funds of the Corporation from time to time; and to
take and hold any properties as security for the payment of funds so loaned and
invested;
(i) To lend money to employees, officers and directors, and to otherwise
assist employees, officers and directors. Loans to members of the Board of
Directors shall be made only upon the approval of a majority of the Board of
Directors excluding the Director to whom the loan is to be made; and
(j) To declare dividends upon a capital stock of the Corporation in
currency, in property, or in shares of the capital stock, subject to the
limitations of the Articles in a Corporation and of applicable law. For Payment
of any dividend, there may be set aside out of the funds of the Corporation
available for dividends such sum or sums as a Director from time to time and in
their absolute discretion, think proper as a reserve or reserves to meet
contingencies, or for equalizing dividends, or for repairing or maintaining any
property of the Corporation, or for such other purpose as Directors shall think
conducive to the interest of the Corporation, and the Directors may modify or
increase any such reserve and the manner in which in was created.
ARTICLE 5
THE OFFICERS
Section 5.01. Officers. The officers of the Corporation shall be a
president, secretary, and treasurer, and each of them shall be appointed by the
Board of Directors. The Corporation may have such other executive officers as
the Board of Director may create. Officers need not be Directors. One person may
hold two (2) or more officers.
Section 5.02. Election. The officers of the Corporation, except as
officers as may be appointed in accordance with the provisions of Section 5.03
or of Section 5.05 of this Article, shall be elected annually by the Board of
Directors, and each shall hold office until the officer shall resign or shall be
removed for otherwise disqualified to serve, where the officer's successor shall
be elected and qualified; provided that officers may be appointed at anytime by
the Board of Directors, or, as permitted by Section 5.03 of this Article, by the
president, for the purpose of initially filling an office or filling a newly
created or vacant office.
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Section 5.03. Subordinate Officers. The Board of Directors may appoint,
and may empower the president to appoint, such other officers as the business of
the Corporation may require, each of whom shall hold office for the term, and
the authority and perform the duties as are provided in these Bylaws or as the
Board of Directors may from time to time determine.
Section 5.04. Removal and Resignation. Any officer may, subject to any
contractual arrangements between the officer and the Corporation, be removed,
either with or without cause, by a majority of the directors in office at the
time, at any regular or special meeting of the Board of Directors, or, except in
case of an officer chosen by the Board of Directors, by the president or any
other officer upon whom the power of removal may be conferred by the Board of
Directors. Any officer may resign at anytime by giving written notice to the
Board of Directors or to the president, or to the secretary of the Corporation.
Any resignation shall take effect at the date of receipt of the notice or at any
later time specified therein, and, must otherwise specify therein, the
acceptance of a resignation shall not be necessary to make it effective.
Section 5.05. Vacancies. A vacancy in any office because of death, or
resignation, removal, disqualification or any other cause shall be filled in the
manner prescribed in these Bylaws for regular appointments to that office.
Section 5.06. President. Subject to such supervisory powers, if any, as
may be given by the Board of Directors to the chairman of the board, if any, or
an officer senior to the president, if there be such an officer, the president
shall be the chief executive officer of the Corporation and shall, subject to
the control of the Board of Directors, had general supervision, direction and
control of the business and officers of the Corporation. The president shall
preside at all meetings of the shareholders, and, in the absence of the chairman
of the board, or vice chairman, or officer, if any, senior to the president, at
all meetings of the Board of Directors. The president shall be ex-officio a
member of all standing committees, if any, and shall have the general powers and
duties of management usually invested in the office of the president of a
Corporation, and such other powers and duties as may be prescribed by the Board
of Directors or these Bylaws.
Section 5.07. Vice President. In the absence or disability of the
president, the vice president shall perform all of the duties of the president,
and when so acting, shall have all of the powers of and be subject to all of the
restrictions upon the president. The vice president shall have such other powers
and perform such other duties as may be prescribed for him respectively by the
Board of Directors, the president, the officer, if any, senior to the president
for these Bylaws.
Section 5.08. Secretary. The secretary shall keep or cause to be kept,
at the registered officer, the principal business office or such other place as
the Board of Directors may order, a book of minutes of all meetings of Directors
and Shareholders, with the time and place of holding, whether regular or
special, and if special, how authorized, the notice thereof given, the names of
those present at the Directors' meetings, the number of shares present or
represented at
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Shareholders' meetings, and of the proceedings thereof. The secretary shall keep
or cause to be kept, in any form permitted by law, at the registered office, the
principal business office or at the office of the Corporation's transfer agent,
the stock register, or a duplicate stock register, revised at least once
annually, showing the names of the shareholders and their resident addresses and
the number and classes of shares held by each shareholder. If the share register
or a duplicate share register is located at a place and there is a registered
office at the Corporation, the secretary shall file a certificate with the
resident agent located at the registered office setting out the name of the
custodian of the stock ledger or a duplicate stock ledger, and the present and
complete post office addresses, including state and number, if any, where such a
stock ledger or duplicate stock ledger is kept. The secretary shall give, or
cause to be given a notice of all meetings of the Shareholders and of the Board
of Directors in written consents in lieu thereof required by the these Bylaws or
by law to be given, and shall keep the seal of the Corporation in safe custody,
and shall have such other powers and perform such other duties as may be
prescribed by the Board of Directors, the president or these Bylaws.
Section 5.09. Treasurer. The treasurer shall keep and maintain, or cause
to be kept and maintained, adequate and correct accounts of the properties and
business transactions of the Corporation, including the accounts of its assets,
liabilities, receipts, disbursements, gains, losses, capital surplus and shares.
Any surplus, including earned surplus, paid-in surplus and surplus arising from
a reduction of stated capital, shall be classified according to source and shown
in a separate account. The books of account shall at all times be open to
inspection by any Director. The treasurer shall deposit all monies and other
valuables in the name and to the credit of the Corporation and such depositories
as may be designated by the Board of Directors. The treasurer shall disburse the
funds of the Corporation as may be ordered by the Board of Directors, shall
render to the president and Board of Directors, whenever they are requested, an
account of all transactions as treasurer and of the financial condition of the
Corporation, and shall have such other powers and perform such other duties as
may be prescribed by the Board of Directors, the president for these Bylaws. If
required by the Board of Directors, the treasurer shall give the Corporation a
bond in such sum and with such surety or sureties shall be satisfactory to the
Board of Directors for the faithful performance of the duties of office of
treasurer and for the restoration of the Corporation, in case of death,
resignation, retirement or removal from office, of all books, papers, vouchers,
money and other property of whatever kind in the treasurer's possession or under
the treasurer's control belonging to the Corporation.
Section 5.10. Corporate Bank Accounts. Bank accounts in the name of the
Corporation may be open without the approval of the Board of Directors if opened
with the consent of the both the president and treasurer of the Corporation. The
treasurer shall inform the Board of Directors of any bank account opened by the
president and treasurer of the Corporation pursuant to the authority granted in
this Section at the next meeting of the Board of Directors.
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Section 5.11. Transfers of Authority. In case of the absence of any
officer of the Corporation, or for any reason that the Board of Directors may
consider sufficient, the Board of Directors may transfer the powers or duties of
that officer to any officer or to any Director or employee of the Corporation,
provided a majority of the full Board of Directors concur.
ARTICLE 6
MISCELLANEOUS
Section 6.01. Record Date and Closing Stock Books. The Board of
Directors may fix a time in the future, as a record date for the determination
of the shareholders entitled to notice of and to vote at any meeting of
shareholders, or entitled to receive any dividend or distribution, or any
allotment of rights, or to exercise rights in respect to any change, conversion
or exchange of shares. The record date so fixed shall not be more than sixty
(60) days prior to the date of the meeting or event for the purposes of which is
fixed. When a record date is so fixed, only shareholders of records on that date
shall be entitled to notice of and to vote at the meeting, or to receive the
dividend, distribution or allotment of rights, or to exercise the rights, as the
case may be, notwithstanding any transfer of any shares on the books of the
Corporation after the record date. The Board of Directors may close the books of
the Corporation against transfers of shares during the whole or any part of any
of the sixty (60) days.
Section 6.02. Inspection of Corporate Records. The share register or
duplicate share register, the books of account and minutes of proceedings of the
shareholders and the Board of Director and committee or committees, if any,
shall be open to inspection upon the written demand of any shareholder or holder
of a voting trust certificate, at any reasonable time, and for a purpose
reasonably related to his interest as a shareholder of as the holder of a voting
trust certificate, it shall be exhibited at anytime when required by the demand
of any shareholders' meeting of ten percent (10%) of the shares represented at
the meeting. The right to inspect shall include the right to make extracts and
copies. The Corporation may impose a reasonable charge to recover the cost of
labor and materials and cost to produce such copies furnished to the
shareholder. The inspection may be made in person or by an agent or attorney, if
by agent or attorney the demand to inspect must be accompanied by a power of
attorney executed by the shareholder which authorizes the agent or attorney to
inspect the corporate records on behalf of the shareholder. Demand of inspection
other than at a shareholders' meeting shall be made in writing upon the
president or the secretary of the Corporation.
Section 6.03. Drafts. All checks, drafts, bonds, bills of exchange, or
other orders for payment of money, notes, or other evidences of indebtedness
issued in the name of or payable to the Corporation shall be signed or endorsed
by such person or persons and in such manner as, from time to time, shall be
determined by resolution of the Board of Directors.
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Section 6.04. Execution of Contracts. The Board of Directors, except as
in these Bylaws otherwise provide, may authorize any officer or officers, agent
or agents, to enter into any contract or execute any instrument or document in
the name of and on behalf of the Corporation, and authority may be general or
confined to specific instances. Unless otherwise specifically determined by the
Board of Directors or otherwise required by law, formal contracts, promissory
notes or other evidences of indebtedness, deeds of trust, and corporate
instruments or documents requiring the corporate seal, and certificates for
shares of stock owned by the Corporation shall be executed, signed or endorsed
by the president and by the secretary or the treasurer. The Board of Directors
may, however, authorize any one (1) of these officers to sign any such
instruments, for and on behalf of the Corporation, without necessity of counter
signature; may designate officers or employees of the Corporation, other than
those named above, who may, in the name of the Corporation, sign such
instruments; and may authorize the use of facsimile signatures by any of such
persons. No officer, agent or employee shall any power or authority to bind the
Corporation by any contract or engagement or depledge its credit to render it
liable for any purpose or to any amount except as specifically authorized in
these Bylaws or by the Board of Directors in accordance with these Bylaws.
Section 6.05. Certificates of Stock. A certificate or certificates for
shares of the capital stock of the Corporation shall be issued to each
shareholder when any of the shares are fully paid up. All certificates shall be
signed by the president and the secretary or be authenticated by facsimile of
the signature of the president and secretary. Before it becomes effective, every
certificate authenticated by a facsimile or a signature must be counter signed
by a transfer agent or transfer clerk and registered by an incorporated bank or
trust company, either domestic or foreign, as registrar of transfers, as
required or permitted by law. In case any officer or officers who shall have
signed, or whose facsimile signature or signatures shall have been used on, any
certificate or certificates shall cease to be an officer or officers of the
Corporation, because of death, resignation or otherwise, before the certificate
or certificates may have been delivered to the Corporation, the certificate or
certificates may nevertheless be adopted by the Corporation and be issued and
delivered as though the person or persons who signed the certificate or
certificates, or whose facsimile signature or signatures shall have been used
thereon, had not ceased to be an officer or officers of the Corporation.
Certificates for shares may be issued prior to full payment under such
restrictions and for such purposes as the Board of Directors or these Bylaws may
be provide; provided, however, that any certificate so issued prior to full
payment shall state the amount remaining unpaid and the terms of payment
thereof.
Section 6.06. Lost Certificate of Stock. The Board of Directors may
direct a new certificate or certificates to be issued in place of any
certificate or certificates theretofore issued by the Corporation alleged to
have been lost, destroyed, or stolen upon the making of any affidavit of that
fact by the person claimed in the certificate of stock to be lost or destroyed.
When authorized in the issue of a new certificate or certificates, the Board of
Directors may, in its discretion, and as a condition precedent to the issuance
thereof, require the owner of the lost
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or destroyed certificate or certificates, or the shareholder's legal
representative, to advertise the same in any manner as it shall require or give
the Corporation a bond in any sum as it may direct to indemnify the Corporation
against any claim that may be made against the Corporation with respect to the
certificate alleged to have been lost or destroyed, or both.
Section 6.07. Representation of Shares. The president and the secretary
of this Corporation are authorized to vote, represent and exercise on behalf of
this Corporation all rights incident to any and all shares of any other
Corporation or Corporations standing in the name of this Corporation. The
authority herein granted to these officers to vote or represent on behalf of
this Corporation any and all shares held by this Corporation and any other
Corporation or Corporations may be exercised either by these officers in person
or by any persons authorized to do so by proxy or power of attorney duly
executed by these officers.
Section 6.08. Inspection of Bylaws. The Corporation shall keep in its
registered office for the transaction of business the original or a copy of the
Bylaws as amended or otherwise altered to date, certified by the secretary,
which shall be open to inspection by the shareholders at all reasonable times
during office hours.
ARTICLE 7
AMENDMENT
Section 7.01. Power of Shareholders. New Bylaws may be adopted or these
Bylaws may be amended or repealed by the vote or written assent of shareholders
entitled to exercise a majority of the voting power of the Corporation, unless a
greater number is required by law, by the articles of Incorporation or by these
Bylaws.
Section 7.02. Power of Directors. Subject to the right of shareholders
is provided in Section 7.01 of this Article 7 to adopt, amend or repeal Bylaws,
Bylaws may be adopted, amended, or repealed by the Board of Directors; provided,
however, that a Bylaw or an amendment thereof changing the authorized number of
directors may be adopted, amended or repealed by any of the shareholders, except
that if a flexible number of directors is authorized by the Articles of
Incorporation or by these Bylaws, a Bylaw or amendment thereof fixing the exact
number of directors within the limits specified in the Articles of Incorporation
or these Bylaws may be adopted, amended or repealed by the Board of Directors.
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CERTIFICATE OF SECRETARY OF
FLOUR CITY INTERNATIONAL, INC.
I, John W. Y. Tang hereby certify:
1. That I am the duly appointed Secretary of Flour City International,
Inc.
2. That the attached Bylaws, are the currently effective Bylaws of Flour
City International, Inc., as duly adopted by the Board of Directors.
IN WITNESS THEREOF, I have subscribed my name this 24 day of January,
1997.
/s/ JOHN W.Y. TANG
-------------------------------
John W.Y. Tang, Secretary
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FLOUR CITY INTERNATIONAL, INC.
CERTIFICATE OF ADOPTION OF BYLAWS
Adoption by Board of Directors. The undersigned, being all of the persons
appointed in the Articles of Incorporation to act as the first Board of
Directors of the above-named corporation (or being their duly appointed
successors) hereby assent to the foregoing Bylaws, and adopt the same as the
Bylaws of said corporation.
IN WITNESS WHEREOF, we have hereunto set our hands this 16th day of
January, 1997.
Name Signature
John W.Y. Tang John W.Y. Tang
-----------------------------------------
Michael Russo Michael Russo
-----------------------------------------
Johnson Fong Johnson Fong
-----------------------------------------
Certificate by Secretary of Adoption by Directors.
THIS IS TO CERTIFY:
That I am the duly elected, qualified and acting Secretary of the
above-named corporation and that the above and foregoing Bylaws were adopted as
the Bylaws of said corporation on the date set forth above by the persons
appointed in the Articles of Incorporation to act as the first Directors of
said corporation, or their duly appointed successors.
IN WITNESS WHEREOF, I have hereunto set my hand this 16th day of January,
1997.
/s/ John W.Y. Tang, Secretary
-----------------------------------------
John W.Y. Tang, Secretary
Certificate by Secretary of Adoption by Shareholders' Vote.
THIS IS TO CERTIFY:
That I am the duly elected, qualified and acting Secretary of the
above-named corporation and that the above and foregoing Code of Bylaws was
submitted to the shareholders at their first meeting held on the date set forth
in the Bylaws and recorded in the minutes thereof was ratified by the vote of
shareholders entitled to exercise the majority of the voting power of said
corporation.
IN WITNESS WHEREOF, I have hereunto set my hand this 16th day of January,
1997.
/s/ John W.Y. Tang, Secretary
-----------------------------------------
John W.Y. Tang, Secretary
<PAGE> 1
EXHIBIT 10.1
SHARE EXCHANGE AGREEMENT
This Share Exchange Agreement (hereinafter the "Agreement"), is
effective as of January 17, 1997, between Flour City International, Inc., a
Nevada Corporation (hereinafter "Flour City"); Hockley International Limited, a
British Virgin Islands Corporation (hereinafter "Hockley"); and the shareholders
of Hockley (hereinafter "Transferring Shareholders"). Flour City, Hockley and
the Transferring Shareholders shall hereinafter be referred to collectively as
the "Parties".
RECITALS
The Parties desire to enter into this Agreement to effectuate a stock
for stock exchange in a tax-free reorganization; and
The Transferring Shareholders represent that they own one hundred
percent (100%) of the outstanding shares of the capital stock of Hockley; and
The Transferring Shareholders desire to exchange the stock of Hockley
for shares of common stock of Flour City, and Flour City desires to affect such
exchange, all on the terms and conditions herein after set forth and in such
manner that the exchange will constitute a tax-free reorganization pursuant to
the provisions of Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as
amended.
In consideration of the promises and mutual agreements and undertakings
hereinafter set forth, the Parties do hereby adopt said plan of reorganization,
and in order to consummate said plan, to hereby agree as follows:
1. Agreement. Subject to the other terms and conditions of this Agreement, set
forth hereinafter, Flour City, Hockley and the Transferring Shareholders entered
into this Agreement in order to effectuate a stock for stock exchange in a
tax-free reorganization.
A. Pursuant to the terms of this Agreement, the Transferring
Shareholders agree to transfer one hundred percent (100%) of the issued
and outstanding shares of Hockley to Flour City.
B. Flour City agrees to issue a total of eight million (8,000,000)
shares of its restricted common stock to the Transferring Shareholders.
2. Delivery of Shares. On the Closing Date (as hereinafter defined) and upon the
terms and subject to the conditions set forth in this Agreement, Flour City
agrees to transfer and deliver to the Transferring Shareholders and the
Transferring Shareholders agree to accept, a total of 8,000,000 shares of
restricted common stock of Flour City, of which 1,200,000 shares shall be
delivered to
<PAGE> 2
Gold Manor Limited; 1,200,000 shares shall be delivered to Dynamic Choices
Enterprises, Inc.; 4,800,000 shares shall be delivered to Wilson International
Limited; and 800,000 shares shall be delivered to John W.Y. Tang.
A. The Flour City shares, when issued and delivered hereunder, will not
be registered under the Securities Act of 1933, as amended (the "1933
Act") and are therefore "restricted" as that term is defined in Rule 144
promulgated under the 1933 Act.
B. The Flour City shares will contain a legend substantially to the
following effect: "THE SHARES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED,
AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED, OR HYPOTHECATED,
ABSENT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR COMPLIANCE
WITH RULE 144 PROMULGATED UNDER SUCH ACT, OR UNLESS THE COMPANY HAS
RECEIVED AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS
COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED."
3. Consideration, Terms, and Conditions for Transfer of Shares. Upon the terms
and subject to the conditions set forth in this Agreement, the Transferring
Shareholders agree to deliver to Flour City, in full consideration of and in
exchange for said shares of Stock of Flour City, a total of one hundred (100)
shares of common stock of Hockley representing hundred percent (100%) of the
issued and outstanding shares of common stock of Hockley, to be delivered at the
closing provided for herein.
4. Transferring Shareholders Responsible for Actions of Hockley. The
Transferring Shareholders, as the majority and controlling shareholders of
Hockley, shall act in good faith and exercise their best efforts to cause
Hockley to comply with all duties and responsibilities set forth for Hockley in
this Agreement.
5. Conduct of Business Prior to Closing. From the date hereof until the time of
closing hereunder, the Parties covenant and agree that they shall exercise their
best efforts to conduct their business in the usual and ordinary course, and
Hockley shall not, without the written consent of Flour City:
A. Purchase, acquire, sell or otherwise dispose of any property or
services of any kind whatsoever, other than purchases and sales in the
ordinary course of business; or
B. Mortgage, pledge, create a security interest in or otherwise encumber
any of its properties or assets; or
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C. Make or incur any commitment or expenditure or any unusual or
long-term commitment; or
D. Declare or pay any dividend or make any other distribution to
shareholders; or enter into any transaction, contract or other
commitment to take any action which would constitute a material breach
of the representations, warranties or agreements of the Shareholders
contained herein or which would interfere with or prevent a closing
provided for herein.
6. Payment of Taxes and Preservation of Goodwill. From the date hereof until the
time of closing hereunder, Flour City and Hockley shall duly and timely file all
reports and returns required to be filed with the United States, the State of
Nevada, the British Virgin Islands, and the jurisdiction or jurisdictions in
which they are doing business; promptly pay when due all foreign, federal, state
and local taxes, assessments and government fees, charges, interest and
penalties lawfully levied or assessed; duly observe and conform to all lawful
requirements applicable to their business; preserve their business organizations
intact and retain their present officers and employees; preserve the goodwill of
their suppliers, customers and those having business relations with them;
maintain insurance coverage now in effect on all their properties and on all
properties for which they are responsible, and carry the same coverage of public
liability, personal injury and property damage that is now in effect; maintain,
keep and preserve all of their properties and assets in good condition and state
of repair; and meet their contractual obligations and not become in default in
any thereof.
7. Confidentiality of Information. Flour City agrees to treat any information
which is disclosed to it by Hockley as proprietary or confidential to Hockley,
and in the event the closing does not take place, all documents shall be
returned to Hockley and Flour City will not make or retain copies of any
documents or make use of any confidential information disclosed within the
context of its business.
8. Closing. The exchange provided herein (the "Closing") shall take place at
Manning, Marder & Wolfe, located at 707 Wilshire Boulevard, 45th Floor, Los
Angeles, California 90017, on January 21, 1997, at 1:00 p.m. or such other date
and time as may be mutually agreed upon by the parties hereto, but in no event
later than seven (7) days from the date hereof, such time and date being herein
referred to as the "Closing Date". At the Closing:
A. The Transferring Shareholders shall deliver to Flour City all
certificates, assignments, and other instruments which may be necessary,
desirable or appropriate in order to transfer to Flour City all of the
outstanding shares of stock of Hockley, all in form and substance
reasonably satisfactory to Flour City; and
B. Upon receipt of all such documents, Flour City shall issue and
deliver to the Transferring Shareholders the shares of common stock as
set forth in paragraph 2, above.
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9. Representations and Warranties of Transferring Shareholders. The Transferring
Shareholders represent, warrant to and agree as follows:
A. Investment Intent. The Transferring Shareholders have acquired the
shares of Flour City pursuant to this Agreement for investment and with
no present intent to make any resale, assignment, transfer or
hypothecation of all or any part thereof and a certificate representing
such shares will bear a restrictive legend which states, in effect, that
such shares have not been registered under the 1933 Act, and
consequently may not be resold, assigned, transferred or hypothecated
unless registered under such Act or an exemption from the registration
requirement of such Act is available for any such transaction. The
Transferring Shareholders further acknowledge that they are aware of the
business affairs and financial condition of Flour City and the
Transferring Shareholders have had ample opportunity to examine the
books and records of Flour City and have had adequate opportunity to
inquire and receive answers from the officers and directors regarding
Flour City, the Flour City shares and the business of Flour City.
B. Organization and Standing. Hockley is a corporation duly organized,
validly existing and in good standing under the laws of the British
Virgin Islands, with full corporate power to carry on its business as
now being conducted and to own and operate the property and assets now
owned and operated by it, and is duly qualified to transact business and
in good standing in each jurisdiction where the ownership of its
properties or the conduct of its business requires it to be licensed or
qualified to do business. Hockley has complied with all applicable laws
in connection with its formation, issuance of securities, organization,
capitalization and operations. Hockley has also delivered to Flour City
a copy of its Memorandum and Articles of Association and all amendments
thereto, and a copy of its By-Laws as amended, certified by its
Secretary, which documents are complete and correct as of the date of
this Agreement.
C. Stock. The authorized capital stock of Hockley consists of fifty
thousand (50,000) shares of common stock with $1.00 par value, of which
one hundred (100) shares are validly issued and outstanding. All of said
outstanding shares of Hockley have been duly authorized and validly
issued, fully paid and are non-assessable. There are no options,
warrants or other agreements or commitments which now or in the future
may obligate Hockley to issue or purchase any shares of its stock or
other securities.
D. Indebtedness. Hockley is not a party to any note, loan agreement,
agreement to borrow money from others or any commitment by others to
lend money (collectively "Indebtedness").
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E. Financial Statements. Hockley has delivered to Flour City an
unaudited balance sheet (the "Balance Sheet") of Hockley as of October
31, 1996 (the "Balance Sheet Date") an income statement, a statement of
retained earnings and a statement of cash flows for the year then ended.
All of such financial statements are complete and accurately present the
financial position of Hockley on the indicated dates and the results of
its operations for the indicated periods. All of such statements have
been prepared in accordance with generally accepted principles of
accounting consistently applied. Other than those liabilities incurred
in an "arms length" transaction during the ordinary course of business
subsequent to the date of the Balance Sheet Date, Hockley has not
incurred any liabilities, whether absolute, accrued, contingent or
otherwise.
F. Contracts and Other Commitments. Hockley has not committed any
material default on any obligation to be performed by Hockley under any
Material Contract nor has Hockley waived any material right under any
Material Contract. For purposes of this Agreement, the term "Material
Contracts" shall be defined to mean (i) all contracts outside the
ordinary course of business; (ii) all contracts or commitments involving
an obligation which cannot or, in reasonable probability , will not be
performed or terminated with sixty (60) days from the date hereof; (iii)
any bonus, incentive compensation, pension, group insurance or employee
welfare plans; (iv) all collective bargaining agreements or other
contracts or commitments to or with any labor unions or other employee
representatives or groups of employees; or (v) employment contracts and
other contracts, agreements or commitments to or with individual
employees, agents or consultants extending for a period of more than
three (3) months from the date hereof or providing for earlier
termination only upon the payment of a penalty or equivalent thereof.
G. Assets. At the Closing, Hockley will deliver to Flour City copies of
all records, including all signatures or authorization cards, pertaining
to all bank accounts of Hockley, if any.
H. Litigation. Hockley has not engaged in or been threatened with any
legal action or other proceeding before any court or administrative
agency. To its knowledge Hockley has not violated any laws, regulations,
or orders applicable to its business or activities.
I. Changes in Financial Condition. Since the Balance Sheet Date there
has been no material adverse change in the condition of the physical
assets, capitalization, or business of Hockley, no dividend or other
distribution declared, paid or made on any of the shares of Hockley's
capital stock, no direct or indirect redemption, purchase or other
acquisition by Hockley of any shares of its capital stock, no damage,
destruction or loss (whether or not covered by insurance) adversely
affecting the properties, business, or prospects of Hockley, no increase
in the rate of compensation
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payable or to become payable to any officer or other employee of
Hockley, no significant labor disturbances, and no other event or
condition which materially and adversely affects the business of
Hockley. Since the Balance Sheet Date, the business of Hockley has not
sold or transferred any of its property or assets except in the ordinary
course of business, and no contracts have been entered into by Hockley
except in the ordinary course of business.
J. Tax Returns and Liabilities. Hockley has filed or caused to be filed
on a timely basis all Tax Returns that are or were required to be filed
pursuant to the laws, regulations, or administrative requirements of
each governmental body with taxing power over it or its assets or
business operations. Hockley has delivered to Flour City all such Tax
Returns filed since Hockley's inception. Hockley has paid, or made
provision for the payment of, all Taxes that have or may have become due
pursuant to those Tax Returns, or otherwise, or pursuant to any
assessment received by Hockley.
K. Breaches of Contract. Neither the execution nor the delivery of this
Agreement by Hockley, nor the performance of any of its obligations
hereunder, will result in a breach or violation of any term or provision
of or constitute a default under any indenture, mortgage or other
agreement or instrument to which Hockley is a party. Neither the
execution nor the delivery of this Agreement by the Transferring
Shareholders, nor the performance of any its obligations hereunder, will
result in a breach or violation of any term or provision of or
constitute a default under any indenture, mortgage, or other agreement
under which any of them is bound, or any law or order, rule, regulation,
writ, injunction, or decree of any government, governmental
instrumentality or court having jurisdiction over the Transferring
Shareholders or any of its assets or rights, or result in the creation
or imposition of any lien, charge, or encumbrance of any kind whatsoever
on any of such assets or rights.
L. Title to Hockley Stock. The Transferring Shareholders represent and
warrant that this Agreement has been duly executed and delivered by it
and is, as to it, a valid agreement binding upon it in accordance with
its terms; that the Transferring Shareholders have valid title to the
validly issued, fully paid, and nonassessable shares of capital stock of
Hockley set forth in Schedule A, with full right, power, and authority
to transfer, sell, and deliver such shares pursuant to this Agreement;
and that, upon delivery of its shares pursuant to this Agreement, Flour
City will receive valid and marketable title to its shares, free and
clear of all voting and other trust arrangements, liens, encumbrances,
restrictions, and adverse claims, whether existing or contingent.
M. Disclosure. No representations or warranties by Hockley in this
Agreement and no statement contained in any document including, without
limitation, financial
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statements, the schedules, certificates, or other writings furnished or
to be furnished to Flour City or any of its representatives pursuant to
the provisions hereof or in connection with the contemplated
transactions, contains or will contain any untrue statement of material
fact or omits or will omit to state any fact necessary, in light of the
circumstances under which it was made, in order to make the statements
herein or therein not misleading. Documents delivered or to be delivered
to Flour City pursuant to this Agreement are or will be true and
complete copies of what they purport to be. There is no fact known to
the officers, directors, or employees of Hockley unknown to Flour City
on the date this Agreement that may affect or does affect in a
materially adverse manner Flour City's ability to conduct the business
of Hockley substantially as conducted prior to such date.
10. Representations and Warranties of Flour City. Flour City represents and
warrants as follows:
A. Organization and Standing. Flour City is a corporation duly
organized, validly existing and in good standing under the laws of the
state of Nevada, with full corporate power to carry on its business as
now being conducted and to own and operate property and assets now owned
and operated by it, and is duly qualified to transact business and in
good standing in each jurisdiction where the ownership of its properties
or the conduct of its business requires it to be licensed or qualified
to do business.
B. Capital Stock. The authorized capital stock of Flour City consists of
twenty-five million (25,000,000) shares of common stock, $.0001 par
value, of which approximately ten million (10,000,000) shares are issued
and outstanding at the close of business on the effective date of this
Agreement, and five million (5,000,000) shares of preferred stock, $.001
par value, of which no shares are issued and outstanding.
C. Validity of Shares. The shares of Common Stock to be delivered by
Flour City pursuant to this Agreement will, when so delivered, be
validly issued, fully paid and non-assessable.
D. Changes, Dividends. Prior to the Closing hereunder, Flour City will
not split or subdivide or otherwise change or reclassify its outstanding
common stock or declare or distribute any cash or stock dividend upon
such common stock.
E. Authorization of Agreement. The execution, delivery, and performance
of this Agreement by Flour City have been duly authorized by its Board
of Directors, and will not result in any breach, violation, or
constitute a default under its Articles of Incorporation or By-Laws or
any indenture, mortgage, or other agreement, or instrument to which it
is a party.
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F. Contracts and Other Commitments. Flour City has not committed any
material default on any obligation to be performed by Flour City under
any Material Contract nor has Flour City waived any material right under
any Material Contract. For purposes of this Agreement, the term
"Material Contracts" shall be defined to mean (i) all contracts outside
the ordinary course of business; (ii) all contracts or commitments
involving an obligation which cannot or, in reasonable probability, will
not be performed or terminated with sixty (60) days from the date
hereof; (iii) any bonus, incentive compensation, pension, group
insurance or employee welfare plans; (iv) all collective bargaining
agreements or other contracts or commitments to or with any labor unions
or other employee representatives or groups of employees; or (v)
employment contracts and other contracts, agreements or commitments to
or with individual employees, agents or consultants extending for a
period of more than three (3) months from the date hereof or providing
for earlier termination only upon the payment of a penalty or equivalent
thereof.
G. Breaches of Contract. Neither the execution nor the delivery of this
Agreement by Flour City, nor the performance of any obligations
hereunder, will result in a breach or violation of any term or provision
of or constitute a default under any indenture, mortgage or other
agreement or instrument to which Flour City is a party which would
prevent Flour City from executing and performing under this Agreement.
Neither the execution nor the delivery of this Agreement by Flour City,
nor the performance of any its obligations hereunder, will result in a
breach or violation of any term or provision of or constitute a default
under an indenture, mortgage, or other agreement under which any of them
is bound, or any law or order, rule, regulation, writ, injunction or
decree of any government, governmental instrumentality or court having
jurisdiction over Flour City or any of its assets or rights, or result
in the creation or imposition of any lien, charge, encumbrance of any
kind whatsoever on any of such assets or rights which would prevent
Flour City from executing and performing under this Agreement.
H. Litigation. Flour City is not engaged in or threatened with any legal
action or other proceeding before any court or administrative agency
which would prevent Flour City from executing and performing under this
Agreement. To the best of its knowledge, Flour City has not violated any
laws, regulations, or order applicable to its business or activities.
11. Conditions to Obligations of Flour City. The obligations of Flour City
under this Agreement are subject to the fulfillment, at or prior to the
Closing Date, of the following conditions precedent:
A. All representations and warranties of the Transferring Shareholders
and Hockley contained herein and in any certificate or other instrument
delivered pursuant to the provisions hereof, or in connection with the
transactions
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contemplated hereby, shall be true on the Closing Date with the same
force and effect as though such representations and warranties had been
made on the Closing Date.
B. The Transferring Shareholders and Hockley shall have performed and
complied with all of the terms, covenants, and conditions of this
Agreement to be performed or complied with by them, respectively, on or
before the Closing Date.
C. The Transferring Shareholders shall have taken all necessary action
to authorize the execution and performance of this Agreement and shall
have delivered to Flour City true and complete copies, certified by the
Secretary, of resolutions of the Board of Directors evidencing such
action.
D. One hundred percent (100%) of the issued and outstanding shares of
Hockley common stock, which are to be delivered on the Closing Date to
Flour City in accordance with the terms hereof shall be so delivered.
E. No action or proceeding by any governmental body or agency shall have
been threatened, asserted or instituted to restrain or prohibit the
carrying out of the transactions contemplated by this Agreement.
F. All corporate and other proceedings and action taken in connection
with the transactions contemplated by this Agreement and all
certificates, opinions, agreements, instruments, and documents mentioned
in this Paragraph or incident to any such transaction shall be
reasonably satisfactory in form and substance to Flour City and to its
counsel.
The conditions contained in this Paragraph are included for the benefit of Flour
City and, without constituting a waiver of any of its rights hereunder, may be
waived, in whole or in part, by Flour City.
12. Conditions to Obligations of the Transferring Shareholders. The obligations
of the Transferring Shareholders under this Agreement are subject to the
fulfillment, on or before the Closing Date, of the following conditions:
A. All representations and warranties of Flour City contained herein and
in any certificate or other instrument delivered pursuant to the
provisions hereof, or in connection with the transactions contemplated
hereby, shall be true on the Closing Date with the same force and effect
as though such representations and warranties had been made on the
Closing Date.
B. Flour City shall have performed and complied with all of the terms,
covenants, and conditions of this Agreement to be performed or complied
with by it, on or before the Closing Date.
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C. The Board of Directors of Flour City shall have taken all necessary
action to authorize the execution and performance of this Agreement,
including the issuance and delivery of shares of common stock of Flour
City to the Transferring Shareholders in accordance with this Agreement,
and Flour City shall have delivered to the Transferring Shareholders
true and complete copies, certified by the Secretary, of resolutions of
the Board of Directors evidencing such action.
D. No action or proceeding by any governmental body or agency shall have
been threatened, asserted or instituted to restrain or prohibit the
carrying out of the transactions contemplated by this Agreement.
E. All corporate and other proceedings and action taken in connection
with the transactions contemplated by this Agreement and all
certificates, opinions, agreements, instruments, and documents mentioned
in this Paragraph or incident to any such transaction shall be
reasonably satisfactory in form and substance to the Transferring
Shareholders and their counsel.
The conditions contained in this Paragraph are included for the benefit of the
Transferring Shareholders and, without constituting a waiver of any of their
rights hereunder, may be waived, in whole or in part, by the Transferring
Shareholders.
13. Certain Covenants Prior to Closing.
A. The Transferring Shareholders will use their best efforts, and take
such other action as may be necessary, to fulfill all of the conditions
contained in this Agreement and to authorize and consummate, and cause
Hockley to authorize and consummate, all of the transactions herein
contemplated.
B. Flour City will use its best efforts, and take such other action as
may be necessary, to fulfill all of the conditions contained in this
Agreement and to authorize and consummate all of the transactions
contemplated herein.
C. Between the date of this Agreement and the Closing Date, Hockley
shall (a) give Flour City and its authorized representatives full access
to the books and records of Hockley (and permit Flour City to make
copies thereof), (b) permit Flour City to make inspections thereof, and
(c) cause its officers and its advisors (including without limitation
its auditors, attorneys, financial advisors and other consultants) to
furnish Flour City with such financial and operating data and other
information with respect to the business and properties of Hockley, and
to discuss with Flour City and its authorized representatives the
affairs of Hockley, all as Flour City may from time to time reasonably
request.
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D. Between the date of this Agreement and the Closing Date, Hockley
shall give notice to Flour City promptly upon Hockley becoming aware of
any (a) inaccuracy of a representation or warranty set forth herein, or
in any document provided to Flour City hereunder, or (b) any event or
state of facts that, if it had occurred or existed on or prior to the
date of this Agreement, would have caused any such representation or
warranty to be inaccurate, any such notice shall describe such
inaccuracy, event or state of facts in reasonable detail.
E. Between the date of this Agreement and the Closing Date, Hockley
shall cause (a) copies of all reports and other documents given to the
members of the Board of Directors (or any committee thereof) of Hockley
to be delivered to Flour City at the same time and (b) copies of the
minutes of meetings of, and actions taken without a meeting of the Board
of Directors (or any committee thereof) of Hockley to be delivered to
Flour City promptly after the preparation thereof.
F. The Transferring Shareholders and Hockley shall comply with the
intent and all requirements of this Agreement and cooperate with all
parties as they may reasonably request in connection with the provisions
of this Agreement.
14. Survival of Representations and Warranties; Indemnification
A. Survival. All representations, warranties, and agreements contained
in this Agreement shall survive the Closing notwithstanding any
investigation conducted with respect thereto; however, a party shall
have no liability with respect to a representation and warranty, or an
agreement to be performed or complied with prior to the Closing Date, to
the extent that the inaccuracy of such representation and warranty or
the failure to perform and comply with such agreement was not
intentional and was disclosed in another document delivered pursuant to
this Agreement.
B. Indemnification by Hockley. Hockley and the Transferring
Shareholders, jointly and severally, shall indemnify and hold harmless
Flour City, and shall reimburse Flour City for any loss, liability,
claim, damage, expense (including, but not limited to, costs of
investigation and defense and reasonable attorney's fees) or diminution
of value (collectively "Damages") arising from or in connection with (a)
any inaccuracy in any of the representations or warranties of Hockley or
the Transferring Shareholders in this Agreement, or any actions,
omissions or statement of facts inconsistent with any such
representation or warranty, (b) any failure by Hockley or the
Transferring Shareholders to perform or comply with any covenant,
representation or agreement in this Agreement, or (c) any claim by any
person for
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brokerage or finder's fees or commissions or similar payments based upon
any agreement or understanding alleged to have been made by any such
person with Hockley or the Transferring Shareholders (or any person
acting on their behalf) in connection with any of the contemplated
transactions.
C. Indemnification by Flour City. Flour City shall indemnify and hold
harmless Hockley and the Transferring Shareholders, and shall reimburse
said parties for, any Damages arising from or in connection with (a) any
inaccuracy in any of the representations or warranties of Flour City in
this Agreement, or any actions, omissions or statement of facts
inconsistent with any such representation or warranty, (b) any failure
by Flour City to perform or comply with any covenant, representation or
agreement in this Agreement, (c) any claim by any person for brokerage
or finder's fees or commissions or similar payments based upon any
agreement or understanding alleged to have been made by any such person
with Flour City (or any person acting on their behalf) in connection
with any of the contemplated transactions.
D. Procedure for Indemnification. Promptly after receipt by an
indemnified party of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is made against
an indemnifying party, give notice to the indemnifying party of the
commencement thereof, but the failure so to notify the indemnifying
party shall not relieve it of any liability that it may have to any
indemnified party except to the extent the indemnifying party
demonstrates that the defense of such action is prejudiced thereby. In
case any such action shall be brought against an indemnified party and
it shall give notice to the indemnifying party of the commencement
thereof, the indemnifying party shall be entitled to participate therein
and, to the extent that it shall wish, to assume the defense thereof
with counsel satisfactory to such indemnified party and, after notice
from the indemnifying party to such indemnified party of its election so
to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such section for any fees of
other counsel or any other expenses, in each case subsequently incurred
by such indemnified party in connection with the defense thereof, other
than reasonable costs of investigation. If an indemnifying party assumes
the defense of such an action, (a) no compromise or settlement thereof
may be effected by the indemnifying party without the indemnified
party's consent, which shall not be unreasonably withheld unless (i)
there is no finding or admission of any violation of law or any
violation of the rights of any person and no effect on any other claims
that may be made again the indemnified party and (ii) the sole relief
provided is monetary damages that are paid in full by the indemnifying
party and (b) the indemnifying party shall have no liability with
respect to any compromise or settlement thereof effected without its
consent, which shall not be unreasonably withheld. If notice is given to
an indemnifying party of the commencement of any action and it does not,
within ten (10) days after the indemnified party's notice is given, give
notice to the indemnified party of its election to assume the defense
thereof, the indemnifying
12
<PAGE> 13
party shall be bound by any determination made in such action or any
compromise or settlement thereof effected by the indemnified party.
Notwithstanding the foregoing, if an indemnified party determines in
good faith that there is a reasonable probability that an action may
adversely affect it other than as a result of monetary damages, such
indemnified party may, by notice to the indemnifying party, assume the
exclusive right to defend, compromise or settle such action, but the
indemnifying party shall not be bound by any determination of an action
so defended or any compromise or settlement thereof effected without is
consent, which shall not be unreasonably withheld.
15. Further Assurances
A. At the request of Flour City, and without further consideration,
Hockley and the Transferring Shareholders will execute and deliver such
additional instruments of transfer and will take such other actions as
Flour City reasonably requests in order to more effectively transfer to
Flour City full ownership and control of Hockley and all Hockley assets
and properties.
B. At the request of the Transferring Shareholders, and without further
consideration, Flour City will execute and deliver such additional
instruments and will take such other actions as may be reasonably
requested in order to more effectively carry out the transaction
contemplated hereby.
16. Expenses. Each party shall bear its own expenses incident to the
preparation, negotiation, execution, and delivery of this Agreement and
the performance of its obligations hereunder.
17. Other Matters
A. No Other Agreements. All terms and conditions of this Agreement are
set forth herein, and there are no warranties, agreements, or
understandings, express or implied, except those expressly set forth
herein.
B. Binding Agreement. This Agreement is a legal obligation and shall be
binding upon and inure to the benefit of the parties hereto and their
respective heirs, legal representatives, successors and assigns,
enforceable in accordance with its terms, except as limited by
bankruptcy, insolvency, or other laws of general application relating to
the enforcement of creditor's rights and general equitable principles.
This Agreement is not intended to confer upon any person other than the
parties hereto any rights and remedies hereunder.
C. Amendment. This Agreement may not be supplemented, modified, or
amended except by mutual agreement in writing signed by the parties
hereto.
13
<PAGE> 14
D. Notices. Any notice or other communication required or permitted to
be given hereunder shall be deemed properly served if personally
delivered or five (5) days after same is deposited in the United States
Mail, registered or certified and postage prepaid, and properly
addressed as follows:
1. To Gold Manor Limited: P.O. Box 957, Offshore Incorporations
Centre, Road Town, Tortola, British Virgin Islands.
2. To Dynamic Choice Enterprises, Inc.: Wickhams Cay, Road Town,
Tortola, British Virgin Islands.
3. To Wilson International Ltd.:P.O. Box 957, Offshore
Incorporations Centre, Road Town, Tortola, British Virgin
Islands.
4. To John W.Y. Tang: Suite 1301, Hollywood Plaza, 610 Nathan Road,
Mongkok, Kowloon, Hong Kong.
5. To Flour City: 915 Riverview Drive, Johnson City, TN 37601.
Or at such other addresses as may be designated by the parties in
writing.
E. Specific Performance. The parties acknowledge that the subject matter
of this Agreement (i.e. the business and assets of Hockley) is unique
and that no adequate remedy at law would be available for breach of this
Agreement. Accordingly, each party agrees that the other parties will be
entitled to an appropriate decree of specific performance or other
equitable remedies to enforce this Agreement (without any bond or other
security being required) and each party waives the defense in any action
or proceeding brought to enforce this Agreement that there exists an
adequate remedy at law.
F. Arbitration. Any controversy, dispute or claim arising out of, in
connection with, or in relation to the interpretation, performance or
breach of this Agreement shall be settled, at the request of either
party, by binding arbitration conducted in Los Angeles in accordance
with the then-existing rules of the American Arbitration Association,
and judgment upon any award rendered by the arbitrator(s) may be entered
in any state or federal court having jurisdiction thereof. The parties
intend that this agreement to arbitrate shall be valid, enforceable, and
irrevocable.
G. Assignment. Neither this Agreement nor any right created hereby shall
be assignable by any party or their successors in interest without the
prior written consent of all other parties hereto, and any such
attempted assignment shall be void. Nothing in this agreement, expressed
or implied, is intended to confer upon any person, other than the
parties hereto, any rights or remedies under or by reason of this
14
<PAGE> 15
Agreement.
H. Paragraphs and Other Headings. Paragraphs and other headings
contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement.
I. Choice of Law. It is the intention of the parties that the laws of
the State of Nevada should govern the validity of this Agreement, the
construction of the terms and the interpretation of the rights and
duties of the parties.
J. No Waiver. The failure of any party to insist upon strict adherence
to any term of this Agreement on any occasion shall not be considered a
continuing waiver or deprive that party of the right thereafter to
insist upon strict adherence to that term or any other term of this
Agreement. Any waiver must be in writing.
K. Severability. In the event that any one or more of the provisions
contained in this Agreement shall for any reason be held to be invalid,
illegal or unenforceable, the same shall not affect the any other
provisions of this Agreement, but this Agreement shall be construed as
if such invalid, illegal, or unenforceable provisions had never been
contained herein.
L. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of
which shall constitute one and the same instrument.
M. Time. Time is of the essence.
15
<PAGE> 16
IN WITNESS HEREOF, the parties hereto have executed and delivered this
Agreement effective as of the day and year first written above.
FLOUR CITY INTERNATIONAL, INC.
By: _______________________________
Name: Michael Russo
Title: President
GOLD MANOR LIMITED
By: _______________________________
Name: _______________________________
Title: _______________________________
DYNAMIC CHOICE ENTERPRISES
By: _______________________________
Name: _______________________________
Title: _______________________________
WILSON INTERNATIONAL LIMITED
By: _______________________________
Name: _______________________________
Title: _______________________________
________________________________________
John W.Y. Tang
16
<PAGE> 17
SCHEDULE A
OWNERSHIP OF STOCK OF HOCKLEY INTERNATIONAL LIMITED
1. Gold Manor Limited 15 Shares
2. Dynamic Choice Enterprises, Inc. 15 Shares
3. Wilson International Ltd. 60 Shares
4. John W.Y. Tang 10 Shares
17
<PAGE> 1
EXHIBIT 10.2
STOCK PURCHASE AGREEMENT
among
Armco Inc.,
Flour City Architectural Metals, Inc.
and
Flour City International, Inc.
-------------------------------------
Dated as of January 1, 1997
-------------------------------------
Sale of Stock
of
Flour City Architectural Metals, Inc.
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION> Page
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<S> <C> <C>
ARTICLE I. DEFINITION OF TERMS................................................. 1
1. Certain Definitions................................................ 1
1.1 Bonds......................................................... 1
1.2 Business Day.................................................. 1
1.3 Closing and Closing Date....................................... 1
1.4 Code........................................................... 1
1.5 Company....................................................... 1
1.6 Effective Date................................................ 1
1.7 Effective Date Schedule of Working Capital.................... 2
1.8 Effective Date Schedule of GPC Projected Cash Flow............ 2
1.9 Financial Statement........................................... 2
1.10 Guaranteed Project Contracts or GPC........................... 2
1.11 Knowledge..................................................... 2
1.12 Leased Real Property.......................................... 2
1.13 Purchaser's Bonds............................................. 2
1.14 Liens or Encumbrances......................................... 2
1.15 Material Adverse Effect....................................... 2
1.16 Other Seller's Agreements..................................... 2
1.17 Permitted Liens............................................... 3
1.18 Person........................................................ 3
1.19 Pre-Effective Date Periods.................................... 3
1.20 Project Contracts............................................. 3
1.21 Promissory Note.............................................. 3
1.22 Property..................................................... 3
1.23 Shares....................................................... 3
1.24 Tax or Taxes................................................. 3
1.25 Tax Returns.................................................. 3
ARTICLE II. PURCHASE AND SALE OF SHARES....................................... 4
2.1 Purchase and Sale............................................ 4
2.2 Consideration................................................ 4
2.3............................................................... 5
2.4 Closing...................................................... 6
2.5 Transactions to be Effected at Closing....................... 6
</TABLE>
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<PAGE> 3
<TABLE>
<CAPTION> Page
----
<S> <C> <C>
ARTICLE III. REPRESENTATIONS AND WARRANTIES OF SELLER......................... 7
3. Representations and Warranties of Seller......................... 7
3.1 Organization, Standing and Authority of Seller............. 7
3.2 Execution and Delivery..................................... 7
3.3 Consents and Approvals..................................... 7
3.4 No Breach.................................................. 8
3.5 Outstanding Capital Stock, Options or Other Rights......... 8
3.6 Transfer of the Shares..................................... 8
3.7 Organization and Qualification............................. 8
3.8 No Violation of Company Instruments........................ 8
3.9 Financial Statement........................................ 8
3.10 Assets..................................................... 9
3.11 Judgments, Decrees and Orders in Restraint of Business..... 10
3.12 Litigation and Proceedings................................. 10
3.13 Permits, Licenses and Franchises........................... 11
3.14 Other Sale Arrangement..................................... 11
3.15 Employee Benefit Plans..................................... 11
3.16 Contracts and Binding Commitments.......................... 13
3.17 Taxes...................................................... 14
3.18 Accounts; Directors and Officers........................... 15
3.19 Compliance with Applicable Law............................. 15
3.20 Conflict of Interest....................................... 16
3.21 Brokers, Finder's or Similar Fees.......................... 16
ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF
PURCHASER........................................................ 16
4. Representations and Warranties of Purchaser..................... 16
4.1 Due Incorporation and Authority........................... 16
4.2 Consents.................................................. 17
4.3 No Breach................................................. 17
4.4 Actions and Proceedings................................... 17
4.5 Broker's, Finder's or Similar Fees........................ 18
4.6 Purchase for Investment................................... 18
</TABLE>
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<PAGE> 4
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE V. COVENANTS AND AGREEMENTS.....................................18
5. Covenants and Agreements.....................................18
5.1 Confidentiality; Return of Documents.................18
5.2 Fees and Expenses....................................19
5.3 Employee Benefit Plans...............................19
5.4 Taxes................................................19
5.5 Seller's Access to Records...........................21
5.6 Litigation or Claim Defense Assistance...............22
5.7 Bonds and Purchaser's Bonds..........................22
5.8 Guarantees...........................................22
5.9 Manufacturing Agreement..............................23
5.10 Services Agreement...................................23
5.11 Disclaimer of Other Representations and Warranties...23
5.12 Further Assurances...................................23
5.13 Intellectual Property Assignment.....................24
5.14 Preservation of Company's Financial Position.........24
5.15 Change of Control Agreements.........................24
ARTICLE VI. SURVIVAL OF REPRESENTATIONS AND WARRANTIES
INDEMNITY............................................24
6.1 Survival of Representations and Warranties and
Indemnities..........................................24
6.2 Indemnity............................................24
6.3 Indemnification for Environmental Claims.............28
ARTICLE VII. AMENDMENT AND WAIVER.................................30
7.1 Amendment............................................30
7.2 Extension; Waiver....................................30
</TABLE>
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<PAGE> 5
<TABLE> Page
<CAPTION> ----
<S> <C>
ARTICLE VIII. MISCELLANEOUS.................................................31
8.1 Notices..............................................31
8.2 Interpretation.......................................32
8.3 Governing Law........................................32
8.4 Publicity............................................32
8.5 Assignment; Binding Effect...........................32
8.6 Entire Agreement; Third Party Beneficiaries..........32
8.7 Construction.........................................32
8.8 Counterparts.........................................33
</TABLE>
<TABLE>
EXHIBITS
- --------
<S> <C> <C>
A - Flour City Architectural Metals Balance Sheet
B - Non-Interest Bearing Promissory Note
C - Personal Guarantee
D - Parent Guarantee
E - Manufacturing Agreement
F - Services Agreement
</TABLE>
<TABLE>
SCHEDULES
- ---------
<S> <C>
1.7 Effective Date Schedule of Working Capital
1.8 Effective Date Schedule of Guaranteed Projects Contracts (GPC)
Projected Cash Flow
1.10 Guaranteed Project Contracts
1.20 Project Contracts
3.10(a)(i) Leased Real Property
3.10(a)(iii) Hazardous Materials
3.10(b) Other Property
3.10(c) Intangible Property
3.11 Judgments, Decrees and Orders in Restraint of Business
3.12 Litigation
3.13 Permits, Licenses and Franchises
3.15(a) Employee Benefit Plans
3.15(c) Determination Letters
3.15(e) Multiemployer Plans Contributed During 1996
3.16 Contracts and Binding Commitments
3.17 Tax Returns
3.18 Accounts; Directors and Officers
3.19 Compliance with Applicable Law
3.3 Consents and Approvals
4.3 No Breach
4.4 Actions and Proceedings
5.8(a) Guarantees
5.15 Change of Control Agreements
</TABLE>
-iv-
<PAGE> 6
This STOCK PURCHASE AGREEMENT made and entered into this 24th day of
January 1997, but effective as of January 1, 1997, by and among Armco Inc., an
Ohio corporation ("Seller"), Flour City Architectural Metals, Inc., a Delaware
corporation ("Company"), and Flour City International, Inc., a Nevada
corporation ("Purchaser"):
W I T N E S S E T H
WHEREAS, Seller is the beneficial and record owner of all of the issued
and outstanding shares of capital stock ("the Shares") of Company; and
WHEREAS, Seller wishes to sell to Purchaser and Purchaser wishes to buy
from Seller the Shares on the terms and conditions set forth in this Stock
Purchase Agreement (the "Agreement");
NOW, THEREFORE, in reliance upon the representations and warranties
contained herein and in consideration of the mutual covenants contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties, intending to be bound, agree as follows:
ARTICLE I.
DEFINITION OF TERMS
1. Certain Definitions. As used in this Agreement, the following
terms have the following meanings unless the context requires otherwise:
1.1 "Bonds" has the meaning set forth in Section 5.7(a).
1.2 "Business Day" means a day on which Seller, Purchaser and
national banks doing business in New York City are open for business.
1.3 "Closing" and "Closing Date" have the meanings set forth in
Section 2.4.
1.4 "Code" means the Internal Revenue Code of 1986, as amended.
1.5 "Company" means Flour City Architectural Metals, Inc., a
Delaware corporation.
1.6 "Effective Date" means January 1, 1997.
<PAGE> 7
1.7 "Effective Date Schedule of Working Capital" means the schedule
of trade receivables, other receivables (including any cost incurred in excess
of billings) and other current assets less trade payables and billings in
excess of revenue earned directly related to the Project Contracts prepared in
accordance with the accounting principles and procedures of Company
consistently applied (Schedule 1.7).
1.8 "Effective Date Schedule of GPC Projected Cash Flow" means the
schedule which reflects the cash flow status of the Guaranteed Project
Contracts as of the Effective Date (Schedule 1.8).
1.9 "Financial Statement" means the balance sheet of Company as of
December 31, 1996 set forth on Exhibit A.
1.10 "Guaranteed Project Contracts" or "GPC" means the contracts for
projects substantially complete which are listed on Schedule 1.10.
1.11 "Knowledge" means, with respect to Seller and Company, the
knowledge of Company's current officers after having made due inquiry of the
appropriate individuals employed by Company.
1.12 "Leased Real Property" means all real property being leased by
Company, a list of which is set forth in Schedule 3.10(a)(i).
1.13 "Purchaser's Bonds" means letter(s) of credit and/or bonds as
described in Section 5.7(b) of this Agreement.
1.14 "Liens or Encumbrances" means any lien, pledge, mortgage,
security interest, claim, lease, charge, option, right of first refusal,
easement, servitude, transfer restriction under any shareholder or similar
agreement, encumbrance or any other similar restriction or limitation.
1.15 "Material Adverse Effect" means an effect which is materially
adverse to the business, financial condition or results of operations of
Company.
1.16 "Other Seller's Agreement" means each agreement to be executed
in connection with the transactions contemplated hereunder to which Seller is a
party.
- 2 -
<PAGE> 8
1.17 "Permitted Liens" means those Liens or Encumbrances affecting
real or personal property which (i) are for taxes, assessments or other
governmental charges, or the claims of materialmen, carriers, landlords or like
persons, all of which are not yet due or payable or which are being contested
in good faith by appropriate proceedings and for which an appropriate reserve
has been established, (ii) are zoning, building or other similar governmental
restrictions, (iii) are easements, covenants, rights-of-way or other similar
restrictions, or (iv) arise in the ordinary course of business.
1.18 "Person" means any individual, corporation, partnership, firm,
joint venture, association, joint stock company, trust, unincorporated
organization, governmental or regulatory authority or other entity.
1.19 "Pre-Effective Date Periods" means all tax periods ending on or
before the Effective Date.
1.20 "Project Contracts" means the contracts for projects in
progress which are listed on Schedule 1.20.
1.21 "Promissory Note" means the non-interest bearing note described
in Section 2.2(b)(i) of this Agreement.
1.22 "Property" means personal property, tangible or intangible.
1.23 "Shares" means all of the issued and outstanding capital stock
of Flour City Architectural Metals, Inc. consisting of 1,000 shares of common
stock, par value $1.00 per share.
1.24 "Tax" or "Taxes" means any federal, state, local, foreign or
other income, premium, profits, estimated, franchise, license, impost,
transfer, sales, use, ad valorem, customs, payroll, withholding, employment,
wage, occupation, value added, property (real or personal), excise or other
taxes, fees, duties, assessments, withholdings or governmental charges of any
nature (including interest, penalties or additions to such items).
1.25 "Tax Returns" means all returns, reports, estimates,
declarations, information returns and statements of any nature regarding taxes
for any period required to be filed by Seller or Company and relating to the
income, properties or operations of Company.
- 3 -
<PAGE> 9
ARTICLE II.
PURCHASE AND SALE OF SHARES
2.1 Purchase and Sale. Upon the terms and subject to the conditions
set forth in this Agreement, Seller shall sell, assign, transfer, convey and
deliver to Purchaser and Purchaser shall purchase from Seller, on the Closing
Date, the Shares.
2.2 Consideration.
(a) In consideration for the Shares, Purchaser (i) shall
pay Seller the sum of One Hundred and 00/100 U.S. Dollars (U.S. $100), (ii)
agrees to cause Company to fully, diligently, competently and completely
perform and (iii) guarantees the full, diligent, competent and complete
performance of all the obligations of Company, including but not limited to the
Project Contracts and the Guaranteed Project Contracts.
(b) At the Closing, Seller shall deliver to Purchaser the
Effective Date Schedule of Working Capital (Schedule 1.7) directly related to
the Project Contracts prepared consistent with the accounting principles and
procedures of Company consistently applied.
Schedule of Working Capital
(i) To the extent that the Effective Date Schedule
of Working Capital reflects the working capital of Company directly related to
the Project Contracts to be less than three million dollars ($3,000,000),
Seller shall deliver a non-interest bearing promissory note to Purchaser in an
amount equal to the difference between three million dollars ($3,000,000) and
the working capital related to the Project Contracts ("Promissory Note"). The
Promissory Note shall become due and payable upon delivery to Seller by
Purchaser of the Purchaser's Bond as required by Section 5.7(b) of this
Agreement. The Promissory Note shall be in the form of Exhibit B.
(ii) At the Closing, Seller shall deliver to
Purchaser the Effective Date Schedule of GPC Projected Cash Flow (Schedule 1.8)
which reflects the cash flow status of the GPC as of the Effective Date. Seller
represents that the GPC Projected Cash Flow after the Effective Date shall not
be less than two million dollars ($2,000,000) ("Total Cash Flow Projection").
In the event that, (i) upon expiration of each annual period following
the Effective
<PAGE> 10
Date, (ii) upon delivery of an updated Schedule of GPC Projected Cash Flow by
Purchaser to Seller, as provided below, which indicates a "Shortfall," as
defined below, equal to or in excess of one million dollars ($1,000,000); or
(iii) upon final completion and closing out of the GPC, the actual GPC cash flow
is less than the Total Cash Flow Projection, (the difference between such actual
GPC cash flow and the Total Cash Flow Projection shall be the "Shortfall"),
Seller shall pay to Purchaser an amount equal to fifty percent (50%) of the
Shortfall, up to a total payment by Seller of two million dollars ($2,000,000).
In the event the Shortfall exceeds four million dollars ($4,000,000), Seller
shall pay to Purchaser one hundred percent (100%) of the amount by which the
Shortfall exceeds four million dollars ($4,000,000) ("Excess Shortfall").
Purchaser shall provide Seller with an updated Schedule of GPC Projected Cash
Flow at three (3) month intervals following the Effective Date until Purchaser
and Seller agree that all of the GPC have been completed and closed out. Any
Shortfall payments required to be made to Purchaser by Seller hereunder shall be
made within thirty (30) days from the date of the determination of the amount of
the Shortfall. In calculating the actual GPC cash flow, all amounts incurred by
Purchaser in defending or satisfying any actual or potential liability
associated with the GPC shall be included.
(iii) At the Closing, Purchaser shall deliver to
Seller Purchaser's calculation of the Interim Cash Adjustment Schedule which
shall reflect the amount of cash, if any, required to be transferred to
Purchaser by Seller for the period commencing on the Effective Date and ending
on the Closing Date (the "Interim Period"). The Interim Cash Adjustment Schedule
shall reflect all cash receipts by the Company, or for the benefit of the
Company, and all cash disbursements made by the Company, or for the benefit of
the Company, during the Interim Period. The amount of cash, if any, required to
be transferred as set forth in the Interim Cash Adjustment Schedule and as
agreed to by Seller, shall be transferred by Seller to Purchaser not later than
two (2) business days after Purchaser and Kasion Contracting Company have
completed the requirements of a Letter of Representation executed by Kasion
Contracting Co. Ltd. concurrently with execution of this Agreement.
2.3 (a) Each of the parties shall have access to the books and
records of Company for purposes of the review of the Schedule of Working
Capital, Schedule of GPC Projected Cash Flow, the calculation of the amount of
the Promissory Note, and the calculation of the Shortfall or any Excess
Shortfall (collectively the "Financial Schedules").
(b) In the event that any party disagrees with any
calculation performed by another party related to any of the Financial
Schedules, the disagreeing party shall notify the other party within thirty
(30) days of receipt of such Financial Schedule or calculation, provided that
the
-5-
<PAGE> 11
disagreeing party has had reasonable access to the relevant books and records.
If the disagreeing party timely delivers the notice setting forth the
disagreement and the items to which it objects. Seller and Purchaser shall have
fifteen (15) Business Days to resolve the disagreement. If the disagreement is
unable to be resolved within such fifteen (15) day period, Seller and
Purchaser agree to retain a nationally recognized accounting firm (the
"Accounting Firm"), to arbitrate and resolve the disputed items in the
Financial Schedule within sixty (60) days of such retention. The Accounting
Firm shall make such determination as an arbitrator by reviewing the disputed
items, such underlying documentation as it deems appropriate, and such written
materials as shall be presented to it by either Seller or Purchaser within 30
days of its retention. On or before the 60th day after its retention, the
Accounting Firm shall deliver a written report to Seller and Purchaser stating
whether each disputed item is calculated as required by this Agreement and
providing the corresponding adjustment to the Financial Schedule, if any. For
the purposes of this engagement, the Accounting Firm shall assume that all
items not being disputed are fairly presented as required by this Agreement. The
determinations by the Accounting Firm shall be final and binding on the parties
hereto for all purposes of this Agreement. The fees and expenses of the
Accounting Firm shall be borne equally by Seller and Purchaser.
2.4 Closing. The Closing of the sale and transfer of the Shares
(the "Closing") will take place at 10:00 a.m. on January 24, 1997 or such date
as the parties mutually agree, provided that the conditions precedent to
Closing set forth in this Agreement have been satisfied or waived (the
"Closing Date"), at the offices of Seller.
2.5 Transactions to be Effected at Closing. At the Closing:
(a) Seller shall deliver to Purchaser (i) one or more
certificates representing the Shares free and clear of any Liens or
Encumbrances, duly endorsed, blank or accompanied by duly executed instruments
of transfer, or registered in the name of Purchaser, and (ii) all documents and
instruments expressly required by this Agreement to be delivered by Seller at
the Closing.
(b) Purchaser and (Guarantor) shall deliver to Seller all
documents and instruments expressly required by this Agreement to be delivered
by Purchaser at the Closing.
<PAGE> 12
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
3. Representation and Warranties of Seller. Seller represents and
warrants to Purchaser as follows:
3.1 Organization, Standing and Authority of Seller. Seller is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Ohio, and is in good standing as a foreign corporation in
all jurisdictions in which its failure to quality or be in good standing would
adversely affect the consummation or the validity of the transactions provided
for in this Agreement. Seller has all requisite corporate power and authority
to execute and deliver this Agreement, to perform its obligations hereunder and
to consummate the transactions contemplated hereby to be consummated by Seller.
3.2 Execution and Delivery. The execution, delivery and performance
by Seller of this Agreement and the consummation of the transactions
contemplated hereby to be consummated by Seller have been duly and validly
authorized by all necessary corporate action on the part of Seller, and no
other corporate proceedings on the part of Seller are necessary to authorize
the execution, delivery and performance by Seller of this Agreement or the
consummation of the transactions contemplated hereby to be consummated by
Seller. This Agreement has been executed and delivered by Seller and (assuming
that such agreement is a valid and binding obligation of Purchaser) constitutes
the valid and binding obligation of Seller, enforceable against Seller in
accordance with its terms, except that (i) such enforceability may be subject
to bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium,
rehabilitation, liquidation conservatorship, receivership or other similar laws
now or hereafter in effect relating to creditors' rights generally and (ii) the
remedy of specific performance and injunctive and other forms of equitable
relief may be subject to equitable defenses and to the discretion of the court
before which any proceeding therefor may be brought.
3.3 Consents and Approvals. The execution and delivery by Seller of
this Agreement, the performance by Seller of its obligations hereunder and the
consummation by Seller of the transactions contemplated hereby to be
consummated by Seller do not require Seller to obtain any consent, approval,
authorization or action of, or make any filing with or give any notice to, any
public, governmental or judicial authority except (a) as set forth in Schedule
3.3; or (b) such as have been duly obtained or made, as the case may be, and
are in full force and effect on the Closing Date.
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<PAGE> 13
3.4 No Breach. The execution, delivery and performance of this
Agreement by Seller and the consummation of the transactions contemplated
hereby by Seller in accordance with the terms and conditions hereof will not
violate, conflict with, or result in the breach of any provision of the
Articles of Incorporation, Regulations or other charter organizational document
of Seller.
3.5 Outstanding Capital Stock, Options or Other Rights. The
outstanding capital stock of Company consists of 1,000 shares of common stock,
par value $1.00 per share. No other class of capital stock, warrant, option or
right to purchase any equity interest of Company is authorized or outstanding.
All of the outstanding shares are owned of record and beneficially by Seller
and constitute 100 percent of the issued and outstanding shares of capital
stock of Company. All of the shares are duly authorized, validly issued, fully
paid and nonassessable.
3.6 Transfer of the Shares. At the Closing, but effective as of
the Effective Date, Seller will convey good title thereto, free and clear of
any Liens or Encumbrances, other than the requirements of the Federal and state
securities laws with respect to limitations on the subsequent transfer thereof
and other than any Liens or Encumbrances thereon that may have been imposed or
consented to by Purchaser.
3.7 Organization and Qualification. Seller has delivered to
Purchaser true and complete copies of the Articles of Certificate of
Incorporation and Bylaws or comparable instruments, in each case, as in effect
on the date hereof, of Company. Company is duly qualified or licensed in all
jurisdictions in which the conduct of its business requires such qualification
or license and the failure so to qualify or be licensed would have a Material
Adverse Effect.
3.8 No Violation of Company Instruments. The execution and
delivery of this Agreement do not, and the sale of the Shares pursuant to this
Agreement will not, violate any provision of the Articles of Incorporation or
Bylaws of Company, or any provision of, or results in the acceleration of any
obligation under, any mortgage, note, lien, lease, franchise, license, permit,
agreement, instrument, order, arbitration award, judgment or decree or in the
termination of any license, franchise, lease, permit or other instrument to
which Company is a party or by which it is bound, except for such as to which
requisite waivers or consents either have been (or will be prior to the
Closing) obtained by Company or the obtaining of which has been waived by
Purchaser.
3.9 Financial Statement. Seller has heretofore delivered to
Purchaser a copy of Financial Statement for the year ended December 31, 1996.
such Financial Statement has been
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<PAGE> 14
prepared in accordance with the accounting principles and procedures of Company
consistently applied.
(a) Seller has converted, as of the Effective Date, the
Intercompany Payable and Intercompany Corporate Control liability accounts
reflected on the December 31, 1996 Financial Statement to common equity
("additional paid in capital").
(b) Seller agrees to discharge or otherwise satisfy in full
the following liabilities reflected on the December 31, 1996 Financial
Statement, which are hereby assigned to, and assumed by Seller as of December
31, 1996: Employee Deductions Payable; Accrued Payroll Taxes; Accrued Taxes;
Other Current Employee Benefits; Workers' Compensation; Other Accruals, except
for accrued real estate taxes for 1996; and Noncurrent Workers' Compensation.
3.10 Assets.
(a) Leased Real Property.
(i) Schedule 3.10(a)(i) hereto contains a true and
correct list of all Leased Real Property. True, correct and complete copies of
all material leases relating to such Leased Real Property (the "Leases") have
been delivered or made available to Purchaser.
(ii) Company is in compliance with the material terms
and provisions of the Leases and except as disclosed in the Schedules hereto,
Company has not received any notice of any default under any Lease.
(iii) Except as set forth in Schedule 3.10(a)(iii),
Company does not use, treat, store or dispose of, or has not permitted any
other party to use, treat, store or dispose of, whether temporarily or
permanently, any hazardous materials at, on or beneath the Leased Real Property
in violation of any Federal, state or local law, regulation or ordinance.
Except as set forth in Schedule 3.10(a)(iii), Seller and Company have no
knowledge of the presence, use, treatment, storage, release or disposal of any
hazardous materials at, on or beneath the Leased Real Property which has
created or might reasonably be expected to create any liability of owners or
occupants of the Leased Real Property under any Federal, state or local law or
regulation or which would require remediation or reporting adverse impact on
the use, occupancy or operation of such Leased Real Property. Except as set
forth in Schedule 3.10(a)(iii), to the knowledge of Seller and
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<PAGE> 15
Company, no asbestos or PCBs are contained in or stored on the Leased Real
Property and there are no storage tanks for petroleum or any other hazardous
materials located in, on or under the Leased Real Property. None of the
Company's current operations involve the generation, transportation, treatment
or disposal of hazardous waste, as defined under 40 C.F.R. Parts 260-270 or any
state equivalent except as permitted by law.
(b) Other Property. Company has good and valid title to all
material personal property owned by Company and that it acquired in the normal
and ordinary course of business free and clear of all Liens or Encumbrances
except for (i) Liens or Encumbrances issued on Schedule 3.10(b) or (ii)
Permitted Liens. Schedule 3.10(b) contains a schedule of all equipment, vehicles
and other tangible personal property of Company having an individual value of
ten thousand dollars ($10,000) or more. Except as otherwise provided herein.
Seller makes no representation or warranty, express or implied, with respect to
any of the assets or property of Company.
(c) Intellectual Property. Company owns or exclusively holds
all rights to, free and clear of all liens, claims or restrictions, the
intellectual property listed on Schedule 3.10(c). Company has not received any
notice with respect to any alleged infringements or unlawful use of any
trademark, service mark, trade name, patent or other intangible property right
owned or alleged to be owned by others.
3.11 Judgments, Decrees and Orders in Restraint of Business. Except
as set forth in Schedule 3.11. Company is not a party to or subject to any
judgment or decree or order entered in any suit, arbitration or proceeding
brought by a governmental agency or, to the knowledge of Seller or Company, by
any other Person enjoining or restricting Company in respect of any (a)
business practice, (b) the acquisition of any property or (c) the conduct of
business in any area, including any regulatory restrictions on writing
insurance.
3.12 Litigation and Proceedings. Except as set forth in Schedule
3.12, there are no actions, suits, arbitrations, investigations or legal,
administrative or other proceedings pending or, to the knowledge of Seller or
Company, threatened against Company, at law or in equity or before or by any
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign, or before any arbitrator of any kind. There is no material
default on the part of Company with respect to any judgment, order, writ,
injunction, decree, award, rule or regulation of any court, arbitration,
governmental department, commission, bureau, board, agency or instrumentality.
<PAGE> 16
(a) Seller agrees to immediately accept the tender of
defense and shall promptly pay all costs, expenses and liabilities associated
therewith, including but not limited to attorneys' fees, fines, costs of
compliance, settlement payments and judgments entered, if any, for all actions,
suits, claims, administrative or other proceedings (collectively the "Actions")
set forth in Schedule 3.12, or Actions arising in the future from the same facts
alleged in any of the Actions set forth in Schedule 3.12; with the sole
exception of the following suits and claim: Sky-Lift Corporation v. Flour City
Architectural Metals, Inc., Tubelite, Inc. v. Flour City Architectural Metals,
Inc., et al.; and the Gage Brothers Concrete Products, Inc. claim, which arise
from Project Contracts or GPC and for which liability remains with Company,
subject to the provisions of Section 2.2(b)(ii).
3.13 PERMITS, LICENSES AND FRANCHISES. Except as set forth in
Schedule 3.13, Company has all permits, licenses, franchises and other
authorizations necessary to, and has complied in all material respects with all
laws applicable to, the conduct of its business and operations in the manner and
in the areas in which such business and operations are presently being
conducted, and all such permits, licenses, franchises and authorizations are in
full force and effect and, to the knowledge of Seller or Company, valid.
3.14 OTHER SALE ARRANGEMENT. Seller and Company are not obligated
or liable, contingently or otherwise, for or in respect of negotiations,
letters of intent or commitments for the sale of all, substantially all or a
material portion of the assets of Company or the sale of the Shares of Company
to any person other than Purchaser.
3.15 Employee Benefit Plans.
(a) Set forth on Schedule 3.15 is a true, accurate and
complete list of all pension, retirement, profit-sharing, deferred
compensation, bonus, stock option or other incentive plan, or other employee
benefit program, arrangement, agreement or understanding, or medical, vision,
dental or other health plan, or life insurance or disability plan, or any other
employee benefit plan as defined in Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA") (whether or not legally
binding), adopted, established, maintained or contributed to by Seller or under
which it would otherwise be a party or have liability and under which employees
or former employees (whether or not retired employees) of Company (or their
beneficiaries) are eligible to participate or derive a benefit (collectively,
the "Employee Benefit
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<PAGE> 17
Plans"). There shall be included within the meaning of Seller, for this purpose
and for the purpose of the representations in this Section 3.15(a), all
"affiliates," whether or not incorporated, within the meaning of Section
407(d)(7) of ERISA.
(b) Full payment has been made of all amounts which Seller
is required, under applicable law or under any Employee Benefit Plan or any
agreement relating to any Employee Benefit Plan to which it is a party, to have
paid as contributions to or benefits under any Employee Benefit Plan as of the
last day of the most recent fiscal year of such Employee Benefit Plan ended
prior to the date hereof. Seller has made adequate provisions in accordance
with generally accepted accounting principles for liabilities to meet current
contributions or benefit payments.
(c) Except as provided in Schedule 3.15(c), a favorable
determination letter has been issued by the Internal Revenue Service (the
"Service") with respect to the qualified status of each of the Employee Benefit
Plans intended to be qualified under Section 401(a) of the Internal Revenue
Code of 1986, as amended (the "Code"), and with respect to the tax exempt
status under Section 501(a) of the Code of (A) any trust through which such
Employee Benefit Plans are funded and (B) any trust or other entity established
with respect to any Employee Benefit Plan and intended to be qualified as a tax
exempt organization under Section 501(c) of the Code. Since the date of the
most recent determination letter, each such qualified Employee Benefit Plan has
been, or can be (within 120 days of Closing), filed with the Service within the
time required to preserve the rights of Seller to adopt such amendment as may
be required by the Service in order to issue a favorable determination letter
with respect to each such Plan's continued tax-qualified and/or exempt status.
To the best knowledge of Seller, no act or omission has occurred since the date
of the last favorable determination letter issued with respect to an Employee
Benefit Plan which resulted or is likely to result in the revocation of the
Plan's tax-qualified or exempt status.
(d) Seller has performed all obligations required to be
performed by it under the Employee Benefit Plans. Seller has not engaged in any
transaction with respect to the Employee Benefit Plans which would subject it
or Purchaser to a tax, penalty or liability for a prohibited transaction under
Sections 406, 407 or 502(i) of ERISA or Section 4975 of the Code, nor have its
directors, officers, employees or agents, to the extent they or any of them are
fiduciaries under Title I of ERISA. Excepting only changes necessary to
preserve an Employee Benefit Plan's tax-qualified or exempt status under the
Code or to otherwise comply with applicable provisions of ERISA and the Code
(and in each case effective only as of the date necessary to do so), Seller
will not, and has no plan or commitment, whether formal or informal, written or
oral, and whether or not legally binding, to modify or change any Employee
Benefit Plan in any material manner prior
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<PAGE> 18
to the Closing. Seller and any "administrator(s)" (as described in Section
3(16)(A) of ERISA) of the Employee Benefit Plans have complied in all material
respects with the applicable requirements of ERISA, the Code and all other
statutes, orders, rules or regulations, specifically including but without
limitation, material compliance with all reporting and disclosure requirements
of Part 1 of Title 1 of ERISA and of the Code in a timely and accurate manner,
and no penalties have been or, to the best knowledge of Seller, will be
imposed, nor is Seller or any administrator liable for any penalties imposed,
under ERISA, the Code or otherwise with respect to the Employee Benefit Plans
or any related trusts.
(e) Except as set forth on Schedule 3.15(e), Company is not
contributing to any multiemployer plan within the meaning of Section 3(37) of
ERISA (the "Multiemployer Plans").
3.16 Contracts and Binding Commitments.
(a) Schedule 3.16 contains a list of all of the following
contracts, arrangements or agreements (true and complete copies or, if none
exist, written descriptions or identification of which have been made available
to Purchaser) to which Company is a party or by which any of the assets or
properties of the Company are bound and which are material to the operations of
Company (such listed contracts herein referred to as the "Contracts"), as such
Contracts may have been amended, modified or supplemented to the date hereof:
(i) all employment, bonus, incentive or deferred
compensation, termination, stay-put, agency, brokerage, consultation or
representation Contracts or similarly binding arrangements of any type
(including without limitation loans or advances) (where the potential liability
of Company exceeds $10,000) with any current or former employee, consultant,
representative, officer or director of Company;
(ii) all Contracts or similarly binding arrangements
with any Person containing any provision or covenant limiting the ability of
Company to engage in any line of business or compete with any Person or
limiting the ability of any Person to compete with the Company following the
Closing;
(iii) all partnership, joint venture or
profit-sharing Contracts with any Person excluding contingent commission or
other similar arrangements with agents and brokers in the ordinary course of
business;
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<PAGE> 19
(iv) all Contracts representing obligations for
borrowed money or the direct or indirect guarantee or securing of any
obligation for, or Contract to service the repayment of, borrowed money or any
other liability in respect of indebtedness for borrowed money of any other
Person, including without limitation, any Contract relating to (A) any lines of
credit, (B) the payment for property, products or services which are not
conveyed, delivered or rendered, or (C) the guarantee of any lease or other
similar periodic payments to be made by any other Person other than any such
Contract for an amount less than fifty thousand dollars ($50,000);
(v) all Contracts relating to computer software
licensing or data processing services representing nonterminable future
liabilities in excess of fifty thousand dollars ($50,000);
(vi) all Contracts between Company and Seller or
their affiliates;
(vii) all Contracts relating to licenses of
trademarks, trade names, service marks or other similar property rights;
(viii) all other Contracts material to the operations
of the business of Company; and
(ix) any power of attorney which is presently
effective and outstanding other than the powers of attorney which exist as a
matter of law or which have been granted pursuant to requirements of applicable
state insurance regulatory authorities.
(b) Company is not in material breach of, or default under
any of the Contracts and, to the knowledge of Seller and Company, no other
party to any Contract is claiming that Company is in material breach or
default. The sale for the Shares pursuant to this Agreement will not result in
the termination of any of the Contracts under the express terms thereof, will
not require further consents of any party thereto (other than those that will
have been obtained on or before the Closing Date) and will not bring into
operation any other provision thereof nor result in a breach or default
thereunder.
3.17 Taxes.
(a) Except as set forth in Schedule 3.17, all Tax Returns,
other than those which are not material to Company, required to be filed in
respect of Company either individually
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<PAGE> 20
or on a consolidated basis that are due (after giving effect to any extensions)
on or prior to the Closing Date have been (or will have been by the closing
Date) filed in accordance with all applicable laws. All such Tax Returns set
forth with reasonable accuracy all material items required to be set forth
therein.
(b) Company has made all withholdings of Taxes required to
be made under all applicable Federal, state, local and foreign tax laws and
regulations, and such withholdings have either been paid to the respective
governmental agencies or set aside in accounts for such purpose or accrued
and entered upon the books of Company.
(c) No deficiencies, adjustments or changes in assessments
for any Taxes in respect of Company have been assessed or, to the knowledge of
Seller, proposed or asserted against Company.
(d) Except as set forth in Schedule 3.17, neither Seller
nor Company, has executed or filed with the Internal Revenue Service or any
other taxing authority any agreement or other document extending the period of
assessment or collection of any Taxes for which Company may be liable.
(e) Except as set forth in Schedule 3.17, Company is not a
party to, is bound by, or has any obligation under any tax sharing or similar
agreement.
3.18 Accounts; Directors and Officers. Schedule 3.18 sets forth a
list of all accounts holding assets of Company together with the names and
address of the applicable financial institution or other depository, the
account number and the names of all persons authorized to draw thereon or who
have access thereto and all safe deposit boxes of Company. Attached as Schedule
3.19 is a true and complete list, as of the date of this Agreement, showing the
names of all of the officers and directors of Company.
3.19 Compliance with Applicable Law. Except as set forth in Schedule
3.19, Company is presently complying in all material respects, in respect of
its business, with all applicable laws (whether statutory or otherwise), rules,
regulations, orders, ordinances, judgments, decrees, orders, writs and
injunctions of all governmental authorities (Federal, state, local, foreign or
otherwise) and Seller, and Company has not received notification from any
governmental authority of any asserted present or past failure to so comply
which has not been resolved or otherwise settled.
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<PAGE> 21
3.20 Conflict of Interest. To the knowledge of Seller, no person who
is a director or officer of Company, (i) has any direct or indirect material
interest in any entity that does business with Company, or (ii) has any
contractual relationship with Company other than as an employee (other than in
the ordinary course).
3.21 Broker's, Finder's or Similar Fees. There are no brokerage
commissions, finder's fees or similar fees or commissions payable in connection
with the transactions contemplated hereby based on any agreement, arrangement
or understanding with Seller, or any action taken by Seller. Purchaser and
Company shall have no obligation or responsibility for the payment of said fee.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF PURCHASER
4. Representations and Warranties of Purchaser. Purchaser
represents and warrants Seller as follows:
4.1 Due Incorporation and Authority. Purchaser is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Nevada, and has all requisite power and authority to own, lease and
operate its assets and business and to carry on its business as now being and
as heretofore conducted. Purchaser has all requisite corporate power and
authority to execute and deliver this Agreement and each other agreement
required to be executed and to consummate the transactions contemplated hereby
and thereby. The execution, delivery and performance by Purchaser of this
Agreement and each other agreement required to be executed and delivered by
Purchaser pursuant thereto, and the consummation by Purchaser of the
transactions contemplated hereby and thereby have been duly and validly
authorized by all necessary corporate action, and no other corporate
proceedings on the part of Purchaser are necessary to authorize the execution,
delivery and performance by Purchaser of this Agreement and each of the other
agreements contemplated by this Agreement, or the consummation of the
transactions contemplated hereby and thereby. This Agreement has been duly and
validly executed and delivered by Purchaser and (assuming this Agreement is a
valid and binding obligation of Seller) constitutes valid and binding
obligation or Purchaser, enforceable against it in accordance with its terms,
except that (i) such enforceability may be subject to bankruptcy, insolvency,
fraudulent
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<PAGE> 22
conveyance, reorganization, moratorium, rehabilitation, liquidation,
conservatorship, receivership or other similar laws now or hereafter in effect
relating to creditors' rights generally and (ii) the remedy of specific
performance and injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought.
4.2 Consents. No consent, authorization, order or approval of, or
filing or registration with, any governmental commission, board or other
regulatory body will be required for or in connection with the execution and
delivery of this Agreement by Purchaser or the consummation by Purchaser of the
transactions contemplated herein.
4.3 No Breach. Except as set forth in Schedule 4.3 the execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated hereby in accordance with the terms hereof will not
(a) violate, conflict with or result in the breach of any provision of the
Articles of Incorporation or Bylaws of Purchaser; (b)(i) require any consent,
approval or notice under (ii) violate, conflict with or result in the breach of
any of the terms of, (iii) result in a material modification of the effect of,
(iv) constitute a default under or (v) give rise to any right of termination,
cancellation or acceleration under, any contract or other agreement to which
Purchaser is a party or by or to which it or any of its assets may be bound or
subject, the impact of which, individually or in the aggregate, would be
materially adverse to the business, operations or financial condition of
Purchaser; (c) violate any order, judgment, injunction, award or decree of any
court, arbitrator or governmental or regulatory agency binding upon Purchaser
or upon the securities, assets or business of Purchaser, the violation of which
would have a material adverse effect on the business, operations or financial
condition of Purchaser; or (d) to the knowledge of Purchaser, violate any
statute, law, rule or regulation of any jurisdiction or governmental or
regulatory agency as relates to Purchaser or to the securities, assets or
business of Purchaser, which violation would have a material adverse effect on
the business, operations or financial condition of Purchaser.
4.4 Actions and Proceedings. To the knowledge of Purchaser, except
as set forth in Schedule 4.4, there are no outstanding orders, judgments,
injunctions, awards or decrees of any court, governmental or regulatory agency
or arbitration tribunal against or involving Purchaser or against or involving
any of its present directors, officers or employees in their capacities as such
that individually or in the aggregate, are likely to prevent Purchaser from
consummating the transactions contemplated hereby in accordance with the terms
hereof, or could affect the validity or enforceability of this Agreement. To
the knowledge of Purchaser, except as disclosed on
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<PAGE> 23
Schedule 4.4, there are no actions, suits or claims or legal, administrative,
regulatory or arbitration proceedings or investigations pending or threatened
against or involving Purchaser or any of its present directors of officers, in
their capacities as such, or its assets that, individually or in the aggregate,
are likely to prevent Purchaser from consummating the transactions contemplated
hereby in accordance with the terms hereof, or could affect the validity or
enforceability of this Agreement.
4.5 Broker's, Finder's or Similar Fees. There are no brokerage
commissions, finder's fees or similar fees or commissions payable in connection
with the transactions contemplated hereby based on any agreement, arrangement
or understanding with Purchaser, or any action taken by Purchaser.
4.6 Purchase for Investment.
(a) Seller has provided Purchaser and its financial
advisors, legal counsel and independent auditors with access to the books,
records, facilities and personnel of Company in order for Purchaser to
investigate the business, affairs and properties of Company to make an informed
investment decision to enter into this Agreement and to purchase the Shares.
(b) Neither Seller nor any agent or other party acting on
behalf of either thereof has made any representation or warranty to Purchaser
with respect to the prospects of Company or its respective business or the
markets in which it operates.
(c) Purchaser represents that it is acquiring the Shares
for its own account for investment and not with a view to the resale or
distribution and will not sell or transfer such Shares in violation of the
Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder.
ARTICLE V.
COVENANTS AND AGREEMENTS
5. Covenants and Agreements. The parties covenant and agree as
follows:
5.1 Confidentiality; Return of Documents. All information provided
pursuant hereto shall be subject to certain confidentiality agreements executed
by the parties and all documents (and
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<PAGE> 24
copies thereof) provided to the other parties shall be promptly returned upon
termination of this Agreement, and each party shall be entitled to injunctive
relief to enforce the provisions of the confidentiality agreements referred to
above and of this Section.
5.2 Fees and Expenses. The parties shall each bear their
respective fees and expenses incurred in connection with this transaction.
5.3 Employee Benefit Plans.
(a) Effective as of the Closing Date, Company shall
withdraw completely from participation in the Employee Benefit Plans. Seller
shall file and give any and all required notices to employees, governmental
agencies or other Persons to effect the withdrawal of Company.
(b) Seller shall assume all obligations and pay, satisfy or
settle all claims, pursuant to the Employee Benefit Plans, arising before the
Closing Date, with respect to participants whether or not employees or former
employees, including without limitation pension benefits previously accrued and
medical, death, disability or other benefits being provided to retired or other
former employees or other participants. Seller shall indemnify Purchaser and
Company for any amounts paid on or after the Closing Date by Company in
connection with the Employee Benefit Plans, including any benefits and any
taxes, damages or expenses including attorney fees.
(c) Company shall provide reasonable assistance and
information to Seller in its administration of the Employee Benefit Plans.
5.4 Taxes.
(a) Cooperation and Exchange of Information. Each party
shall provide each other with such cooperation and information as either of
them reasonably may request of the other in filing any Tax Return, amended
return or claim for refund, determining a liability for taxes or a right to
refund of taxes or in conducting any audit or other proceeding in respect of
Taxes. Such cooperation and information shall include providing copies of all
relevant portions of Tax Returns relating to Company, together with
accompanying schedules and related workpapers, documents relating to rulings or
other determinations by taxing authorities and records concerning the ownership
and tax basis of property, which either party may possess. Each party shall
make its employees or consultants available on a mutually convenient basis to
provide explanation of any
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<PAGE> 25
documents or information provided hereunder. Notwithstanding the foregoing,
neither party shall be required unreasonably to prepare any document, or
determine any information not then in its possession, in response to a request
under this Section. Except as otherwise provided in this Agreement, the party
requesting assistance hereunder shall reimburse the other for any reasonable
out-of-pocket costs incurred in provided any Tax Return, document or other
written information, and shall compensate the other for any reasonable costs
(excluding wages and salaries) of making employees available, upon receipt of
reasonable documentation of such costs. Each party will retain all Tax Returns,
schedules and workpapers and all material records or other documents relating
thereto, until the expiration of the statute of limitations (including
extensions) of the taxable years to which such returns and other documents
relate and, unless such returns and other documents are offered to the other
party, until the final determination of any payments which may be required in
respect of such years under this Agreement. Any information obtained under this
Section shall be kept confidential, except as may be otherwise necessary in
connection with the filing of Tax Returns or claims for refund or in conducting
any audit or other proceeding. Without limiting the generality of the foregoing,
Purchaser and Company shall reasonably prepare and provide to Seller any
federal, state and local tax information requested by Seller for Seller's use in
preparing Tax Returns or in defending prior Tax Returns under audit for which
Seller is responsible. This information shall be completed by Purchaser and
Company within 90 days after receiving written request from Seller or such
earlier date if required by the taxing authority.
(c) Tax Proceedings. In the event Purchaser, or Company receives
notice, whether orally or otherwise, of any pending Tax examination, claim,
settlement, proposed adjustment or related matter that may affect Seller, or in
the event Seller receives any such notice which may affect Purchaser or
Company, the party receiving such notice shall notify the other party in
writing as soon as reasonably practicable. Seller shall be entitled at its
expense to contest, control, compromise, settle or appeal all proceedings with
respect to Company's Taxes for periods ending on or before the Effective Date,
provided that Purchaser shall have the right to participate in and employ its
own counsel, at its expense, with respect to any such proceeding that Purchaser
reasonably believes may cause Purchaser or Company to incur any liability for
payment of Taxes and Seller shall consult in good faith with Purchaser with
regard to any such proceeding. Purchaser agrees that it will cooperate fully
and will cause Company to cooperate fully with Seller in the defense against or
compromise of any claim asserted in any such proceeding.
(d) Indemnification. Seller shall be responsible for and shall
indemnify and hold Purchaser and Company harmless from all liability for all
Taxes attributable or related to any period ending prior to the Effective Date,
provided, however, that Purchaser shall indemnify Seller
<PAGE> 26
for all taxes imposed (determined without regard to any available net operating
Loss Carryovers or other tax benefits) as a result of any election made, or
deemed to have been made by Purchaser under Code Section 338(g) (or any similar
provision of state or local law). Seller shall pay all Taxes imposed or
assessed against Company for any period ending before the Effective Date.
Purchaser and Company shall be responsible for and shall indemnify and hold
Seller harmless from, and Purchaser or Company shall pay all Taxes with respect
to Company attributable or related to periods ending on or after the Effective
Date.
(e) Refunds. Seller shall be entitled to all refunds of Taxes of
Company with respect to any and all periods prior to the Effective Date (and any
interest thereon). Company shall pay to Seller, within five Business Days after
receipt thereof, any such refunds received by Company. If Seller receives a
refund to which Company is entitled, Seller shall pay any such refund to Company
within five Business Days after receipt thereof. Purchaser shall be entitled to
all refunds of Taxes of Company attributable to periods ending after the
Effective Date. Seller shall pay Purchaser, within five Business Days after
receipt thereof, any such refunds received by Seller.
(f) Purchaser agrees to pay any stock transfer taxes in
connection with the transfer of the shares to Purchaser.
5.5 Seller's Access to Records.
(a) Purchaser agrees that after the Closing Date it shall, and
shall cause Company to, (i) provide Seller with reasonable access to the
employees of Purchaser and Company having knowledge of and responsibility for
such books and records (including information stored on electronic data
processing systems), (ii) retain the books and records of Company (including
back-up media for electronic data processing systems) for a period of at least
ten years from the Closing Date in a responsible manner and at a location
reasonably accessible and (iii) allow Seller to examine and make copies of the
books and records pertaining to the business conducted by Company pertinent to
this Agreement and the transactions contemplated hereby, for reasonable business
purposes including without limitation the preparation and examination of Tax
Returns and financial statements and conduct of any litigation or regulatory
dispute resolution, whether pending or threatened, concerning the business or
Company pertinent to this Agreement and the transactions contemplated hereby.
Access to and copying of such books and records shall be restricted to normal
business hours, shall be at Seller's expense and shall not unreasonably
interfere with the business operations of Purchaser or Company. If requested by
Seller
<PAGE> 27
immediately prior to the end of the ten year period, the Purchaser will cause
Company to retain such books and records (at Seller's expense) for a reasonable
extended period of time.
5.6 Litigation or Claim Defense Assistance. When requested by
Seller, Purchaser shall and shall cause Company to assist Seller in the defense
of any claim, action, suit or proceeding instituted or threatened against
Seller or for which Seller has an obligation under this Agreement to indemnify
Purchaser or Company. Such assistance shall include the preparation of
discovery responses, giving depositions, assisting counsel and expert witnesses
of Seller attending all proceedings which Seller shall reasonably request be
attended. Purchaser and/or Company shall be reimbursed for all reasonable
out-of-pocket costs incurred in providing such assistance, but not for any
employee time expended in such litigation or claim assistance.
5.7 Bonds and Purchaser's Bonds.
(a) Subject to the provisions of Section 5.7(b) below, Seller
shall not cancel or terminate any of the outstanding guarantees, bonds or
letters of credit in effect as of the Closing Date with respect to projects of
Company ("Bonds"), except in the ordinary course of business as the obligations
to maintain bonds are (i) satisfied by Company, or (ii) released by the
beneficiaries, or (iii) otherwise expire.
(b) Not later than six (6) months after the Effective Date,
Purchaser shall deliver to Seller one or more letters or surety bonds, naming
Seller as beneficiary, in the principal amount of six million dollars
($6,000,000) to guarantee Purchaser's and Company's performance under this
Agreement including, but not limited to the obligation to perform the Project
Contracts and the Guaranteed Project Contracts ("Purchaser's Bonds"). The
Purchaser's Bonds shall be (i) issued by a bank or surety company acceptable to
Seller, (ii) be in a form reasonably satisfactory to Seller, and (iii) shall
remain in effect for not less than sixty (60) days after Company has fully and
finally performed all obligations under the Project Contracts and Guaranteed
Project Contracts, and all bonding and security obligations under such Project
Contracts have expired; provided that Purchaser's Bond may be reduced to an
amount equal to the aggregate amount of the outstanding Bonds of Seller at any
time upon the request of Purchaser.
5.8 Guarantees. On the Closing Date, Purchaser shall deliver or cause
to be delivered to Seller.
<PAGE> 28
(a) the personal guarantee of the key employees of Company
listed on Schedule 5.8(a) guaranteeing the obligation of Purchaser and Company
under this Agreement including, but limited to the obligations to perform the
Project Contracts and the Guaranteed Project Contracts. Such personal guarantee
shall be in the form of Exhibit C ("Personal Guarantee"), and shall terminate
upon compliance by Purchaser with the Purchaser's Bond delivery requirements of
Section 5.7(b) above.
(b) the guarantee of Flour City International, Inc.,
guaranteeing the obligations of Purchaser and Company under this Agreement
including, but not limited to the obligations to perform the Project Contracts
and the Guaranteed Project Contracts. Such guarantee shall be in the form of
Exhibit D ("Parent Guarantee").
5.9 Manufacturing Agreement. On the Closing Date, Company and
Seller's affiliate, Douglas Dynamics, L.L.C. ("DDLLC") shall enter into a
Manufacturing Agreement for fabrication and assembly work in connection with
certain projects in the form of Exhibit E ("Manufacturing Agreement").
5.10 Services Agreement. On the Closing Date, Company and DDLLC
shall enter in a services agreement in the form of Exhibit F ("Services
Agreement").
5.11 Disclaimer of Other Representations and Warranties. The parties
agree that no party hereto makes nor has made any warranties or
representations, with respect to the transactions contemplated hereby, other
than those expressly set forth in this Agreement, including the exhibits and
schedules attached hereto. The parties agree that Seller makes no warranties or
representations with respect to the anticipated costs or profits on any Project
Contract or Guaranteed Project Contract.
5.12 Further Assurances. Seller and Purchaser agree that each will
from time to time at and subsequent to the Closing Date, at the reasonable
request of the other party and without further consideration, execute and
deliver such other instruments of conveyance, assignment and transfer, or
execute such other documents and provide such cooperation and take such other
actions as either Purchaser or Seller may reasonably request in order to more
effectively convey, assign, transfer to and vest in Purchaser the Shares and
the right to operate the business of Company and carry the intent and perform
the obligations under this Stock Purchase Agreement.
<PAGE> 29
5.13 Intellectual Property Assignment. On or prior to the Closing,
the parties shall enter into Trademark Assignment Agreement and a Patent
Assignment Agreement covering trademarks and patents used by Company.
5.14 Preservation of Company's Financial Position. Purchaser agrees
that it will not cause or permit Company to make payment of any dividend, any
distribution, sale or disposition of assets, or otherwise diminish the
financial viability of Company through the payment of unreasonable employee
bonuses, salaries or otherwise prior to delivery of the Purchaser's Bond to
Seller without the express written consent of Seller, which consent shall not
be unreasonably withheld. Purchaser further agrees that until all Bonds have
been released or expired, Purchaser shall furnish Seller quarterly financial
statements and audited financial statements of the Purchaser, including balance
sheets, statements of income and statements of cash flow.
5.15 Change of Control Agreement. Purchaser agrees that it will
assume and perform all obligations under the employee severance agreements to
which Seller is a party listed on Schedule 5.15, which agreements relate to
employees of Company.
ARTICLE VI.
SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
INDEMNITY
6.1 Survival of Representations and Warranties and Indemnitees.
Except to the extent otherwise provided, all representations and warranties of
the parties under this Agreement or in any exhibit, schedule, certificate or
other document delivered pursuant hereto shall survive the Closing Date for a
period of two (2) years. All agreements, covenants and contractual undertakings
shall survive the Closing Date until such provisions are satisfied. All
provisions shall survive the Closing Date subject to the foregoing terms and
conditions regardless of any investigation at any time made by or on behalf of
the parties or of any information the parties may have with respect to the
other parties, Company and the transactions contemplated hereby.
6.2 Indemnity.
(a) Subject to the provisions of this Section, Seller
hereby agrees, from and after the Closing Date, to defend, indemnify, and hold
Purchaser and Company, harmless from,
<PAGE> 30
against and in respect of any Loss (as hereinafter defined) which may accrue to
or be sustained by Purchaser or Company arising out of, as a result of or in
respect of:
(i) any error, misstatement, omission or inaccuracy
in any representation or warranty of Seller or the breach of any warranty of
Seller under this Agreement, or under any schedule, certificate, agreement,
instrument or other document delivered pursuant thereto; or
(ii) any failure of Seller to duly perform or observe
any term, provision, instrument, covenant or agreement to be performed or
observed by Seller, prior to the Effective Date, pursuant to this Agreement, or
any schedule, certificate, agreement or other document entered into or
delivered pursuant hereto; or
(iii) the operations of Company prior to the
Effective Date, but which is not related to or does not arise from any Project
Contract or Guaranteed Project Contract, other than claims for personal injury
arising from an occurrence prior to the Effective Date; and with respect to the
GPC, subject to the provisions of Section 2.2(b)(ii).
(b) Subject to the provisions of this Section, Purchaser
hereby agrees, from and after the Closing Date, to defend, indemnify, and hold
Seller harmless from, against and in respect of any Loss (hereinafter defined)
which may accrue to or be sustained by Seller for such Loss arising out of, as
a result of or in respect of:
(i) any error, misstatement, omission or inaccuracy
in any representation or warranty of Purchaser or the breach of any warranty of
Purchaser under this Agreement, or under any schedule, certificate, agreement,
instrument or other document delivered pursuant thereto; or
(ii) any failure of Purchaser to duly perform or
observe any term, provision, instrument, covenant or agreement to be performed
or observed by Purchaser or Company after the Effective Date, pursuant to this
Agreement, or any schedule, certificate, agreement or other document entered or
delivered pursuant hereto; or
(iii) the operations of Company after the Effective
Date; or
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<PAGE> 31
(iv) the performance of the Project Contracts or the
Guaranteed Project Contracts whether such liability arises before, on or after
the Effective Date, other than losses resulting from claims for personal injury
arising from an occurrence prior to the Effective Date, and with respect to the
GPC, subject to the provisions of Section 2.2(b)(ii);
(v) any withdrawal liability established under
Sections 4201, et seq. of ERISA resulting from a complete withdrawal or partial
withdrawal from the Multiemployer Plans or any other multiemployer plans as
defined in Section 3(37) of ERISA to which Company has been or will be a
sponsor, a contributor or under an obligation to contribute, only if such
withdrawal liability results from or relates to events occurring after the
Effective Date.
(c) The indemnification and hold harmless
("Indemnification") obligations under this Agreement to which any party is
entitled from any other party pursuant to this Section with respect to breaches
of representations or warranties shall become effective only after the
cumulative amount of such Loss exceeds in the aggregate fifty thousand dollars
($50,000), and such liability shall be limited to such cumulative amounts as
exceed fifty thousand dollars ($50,000).
(d) For purposes of this Agreement, "Loss" shall be deemed
to mean and include any and all losses, liabilities, costs, reasonable expenses,
judgments, assessments, penalties, damages, deficiencies, suits, actions,
claims, proceedings, demands, causes of action, economic loss, and attorneys'
fees and expenses and court costs and interest incident thereto. A Loss shall be
measured net of any insurance recover in respect of such Loss and such Loss
shall not include any incidental or consequential damages (including any loss of
anticipated profits).
(e) In order for a party seeking indemnification
("Indemnified Party") to be entitled to any Indemnification provided for under
this Agreement, such Indemnified Party must give a written demand for
Indemnification to the party against which Indemnification is sought
("Indemnifying Party") as soon as reasonable practicable after the Indemnified
Party has knowledge of the material facts underlying the Indemnification
demand. Such demand must set forth with reasonable specificity the factual and
legal basis of the Indemnification claim and must state as nearly as
practicable the amount of Indemnification sought. The Indemnifying Party shall
admit or deny liability for such Indemnification within 30 days of such demand.
-26-
<PAGE> 32
(f) Third Party Procedures.
(1) The Indemnified Party, promptly upon receipt of
notice of the commencement of any action by a third party against the
Indemnified Party in respect of which Indemnification may be sought hereunder,
shall notify the Indemnifying Party in writing of the commencement thereof.
Upon receipt of notice of the commencement of any such action, the Indemnifying
Party shall assume control of the defense, compromise or settlement thereof
(with counsel reasonably satisfactory to the Indemnified Party) at the
Indemnifying Party's expense. Nothing herein shall be construed so as to give
any insurance carrier a right of subrogation for claims paid except as such
right would otherwise exist in the absence of this Section. Further, nothing
herein shall be construed to create any rights enforceable by any person not a
party to this Agreement.
(2) The Indemnified Party shall be entitled to
participate in the defense of any action and to be represented by counsel of
its own selection at the expense of the Indemnified Party. If the attorneys
provided for the defense of the Indemnified Party by the Indemnifying Party
withdraw from or are removed by court order from the Indemnified Party's
representation, then the cost of counsel selected by the Indemnified Party
shall be part of its Loss, and the Indemnified Party shall have the right in
all respects to conduct its own defense. If the Indemnified Party otherwise
retains its own counsel, the cost thereof shall be borne by the Indemnified
Party.
(3) As to cases in which the Indemnifying Party has
assumed and is providing the defense for the Indemnified Party, the control of
such defense and the right to reach settlement in such action shall be vested
in the Indemnifying Party. Except with the written consent of the Indemnified
Party (which consent shall not be unreasonably withheld), no Indemnifying Party
shall consent to entry of any judgment or enter into any settlement, in respect
of any third party claim which provides for anything other than money damages
or other money payments for which the Indemnified Party is entitled to
indemnification hereunder (subject to the limitations specified in this Section
6.2c) or which does not include as a term thereof the giving by the claimant
or plaintiff to the Indemnified Party of a release from all liability in
respect of such third party claim. If the Indemnified Party, without the prior
written consent of the Indemnifying Party (which consent shall not be
unreasonably withheld), consents to the entry of any judgment or enters into
any settlement with respect to a third party claim which is being defended by
the Indemnifying Party, the Indemnifying Party shall be discharged from any
such liability. As to any action, the party which is controlling such action
shall provide to the other party reasonable
-27-
<PAGE> 33
information (including reasonable advance notice of all proceedings in respect
thereto) regarding the conduct of the action and the right to attend all
proceedings and depositions in respect thereto through its agents and
attorneys, and the right to discuss the action with counsel for the party
controlling such action.
(4) If within 30 days after receipt by the
Indemnifying Party of notice from the Indemnified Party as to the commencement
of any action in respect of which Indemnification is sought hereunder, the
Indemnifying Party has not notified the Indemnified Party that the Indemnifying
Party assumes the defense of such action or has not actually assumed such
defense, then the Indemnified Party shall have the right to defend such action
and to proceed immediately against the Indemnifying Party to enforce all
Indemnification rights hereunder (including but not limited to the costs of
defense). The Indemnification obligations of the Indemnifying Party with
respect to such action shall, however, in no way be diminished by virtue of the
exercise by the Indemnified Party of its rights under this Section, and the
fact that the Indemnified Party shall have defended, settled or compromised
such action pursuant to Section 6.2f(1) shall not, in any circumstances, be
deemed to constitute any waiver, release or exoneration of the Indemnifying
Party from its indemnification obligations, regardless of the outcome of such
action.
6.3 Indemnification for Environmental Claims
(a) Definitions. For purposes of this Section 6.3 the
following terms shall have the meanings set forth in this Section 6.3(a):
"Environmental Claim" means any written accusation, allegation,
notice of violation, claim, demand, abatement or other order or direction
(conditional or otherwise) by any governmental authority or any person for
personal injury (including sickness, disease or death), tangible or intangible
property damage, damage to the environment, nuisance, pollution, contamination
or other adverse effects on the environment, or for fines, penalties or
restrictions, resulting from or based upon (i) the existence or release, or
continuation of the existence of any release (including without limitation,
sudden or nonsudden, accidental or nonaccidental leaks or spills) of, or
exposure to, any substance, chemical, material, pollutant, contaminate, or
audible noise or other release or emission in, into or onto the environmental
(including, without limitation, the air, ground, water or any surface); (ii)
the environmental aspects of the transportation, storage, treatment or disposal
of materials; or (iii) the violation, or alleged violation, of any statutes,
-28-
<PAGE> 34
ordinances, orders, rules, regulations, permits or licenses of or from any
governmental authority, agency or court relating to environmental matters.
"ENVIRONMENTAL LAW" means the Comprehensive Environmental
Response, Compensation, and Liability Act (42 U.S.C. Sections 9601 et seq.) the
Hazardous Material Transportation Act (49 U.S.C. Sections 1801 et seq.), the
Resource Conservation and Recovery Act (42 U.S.C. Sections 6901 et seq.), the
Federal Water Pollution Control Act (33 U.S.C. Sections 1251 et seq.), the Clean
Air Act (42 U.S.C. Sections 7401 et seq.), the Toxic Substances Control Act (15
U.S.C. Sections 2601 et seq.), and the Occupational Safety and Health Act (29
U.S.C. Sections 651 et seq.), as such laws have been amended or supplemented,
and any analogous future federal, or present or future state or local statutes.
"ENVIRONMENTAL LIABILITIES AND COSTS" means all liabilities,
obligations, responsibilities, deficiency, remedial actions, losses, damages,
punitive damages, consequential damages, treble damages, costs and expenses
(including, without limitation, all reasonable fees, disbursements and expenses
of counsel, expert and consulting fees and costs of investigation and
feasibility studies), fines, penalties, sanctions and interest, removal, cleanup
and remedial costs incurred as a result of any claim or demand, by any person,
whether based in contract, tort, implied or express warranty, strict liability,
criminal or civil statute, including any Environmental Law, permit, order or
agreement with a governmental authority or other person, related to an
Environmental Claim.
(b) SELLER'S INDEMNIFICATION OF PURCHASE FOR ENVIRONMENTAL
CLAIMS. The Seller shall fully and promptly pay, perform, discharge, defend,
indemnify and hold harmless the Purchaser, its subsidiaries and affiliates, and
their respective directors, officers and employees from and against any action,
suit, Environmental Claim, Environmental Liabilities and Costs, suffered or
incurred by Purchaser: (i) associated with, or emanating from property owned,
operated, or which constituted a storage or disposal area for Seller, Company,
Cyclops Corporation, MSL/EGS Corporation, E.G. Smith Construction Products,
Inc., Elwin G. Smith, Inc. and Southwestern Materials & Supply, Inc. prior to
the Effective Date (collectively referred to herein as the "Subject
Corporations"); or (ii) resulting from, arising out of, or associated with the
operations of the Subject Corporations in the unlimited past up to, but
excluding the Effective Date; or (iii) resulting from, arising out of, or
associated with the following actions or proceedings: (a) USEPA v. Flour City
Architectural Metals, Inc. DOJ Number 90-7-1-628 and US AO File No. 96-1197; (b)
United States v. Armco, Inc. U.S. District Court for the Southern District of
Ohio
<PAGE> 35
(Case No. C2-95-698); and (c) AT&T Global Information Solutions Company, et al,
v. Armco, Inc., et al., U.S. District Court for the Southern District of Ohio
(Case No.. C2-94-876).
(c) INDEMNIFICATION PROCEDURE. The Seller and Purchaser
agree that in the event any investigation, litigation or proceeding is asserted
or threatened in writing or instituted against Purchaser or any of its
respective subsidiaries or affiliates or any of their respective officers,
directors, employees or agents, or any remedial action is requested for which
Purchaser may desire indemnity or defense hereunder, the Purchaser shall
promptly notify the Seller in writing. The Seller at the request of Purchaser
shall have the obligation to promptly defend against such investigation,
litigation or proceeding or requested remedial action, and shall bear all costs
and expenses associated therewith, including, without limitation, all fees,
disbursements and expenses of counsel, expert and consulting fees and costs of
investigation; provided that, Purchaser at its election, may participate in the
defense thereof at its own expense.
(d) SURVIVAL AND BINDING EFFECT. Notwithstanding anything
contained in this Agreement to the contrary, the provisions of this Section 6.3
shall survive the Closing indefinitely and shall be binding on Seller, its
respective successors and assigns.
ARTICLE VII.
AMENDMENT AND WAIVER
7.1 AMENDMENT. This Agreement may not be amended except by an
instrument in writing signed on behalf of all of the parties hereto.
7.2 EXTENSION; WAIVER. At any time prior to the Closing, the
parties may, in the manner and to the extent legally allowed, (i) extend the
time for the performance of any of the obligations or other acts of the other
parties hereto and (ii) waive compliance with any of the agreements or
conditions contained herein. Any agreement on the part of a party hereto to any
such extension or waiver shall be valid only if set forth in a written
instrument signed on behalf of such party.
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<PAGE> 36
ARTICLE VIII
MISCELLANEOUS
8.1 Notices. All notices or other communications hereunder shall
be in writing and shall be deemed given (i) upon delivery if delivered
personally, (ii) three days after mailing by registered or certified mail
(return receipt requested), or (iii) upon receipt if sent by an overnight
delivery service or sent by facsimile transmission to the parties at the
following addresses (or at such other address for a party as shall be specified
by like notice):
(a) If to Purchaser, to:
Flour City International, Inc.
915 Riverview Drive
P.O. Box 629
Johnson City, TN 37601
Attention: Michael J. Russo
President
with a copy to:
Manning, Marder & Wolfe
707 Wilshire Boulevard
45th Floor
Los Angeles, CA 90017
Attention: William J. Lopshire, Esq.
(b) If to Seller, to:
Armco Inc.
One Oxford Centre
301 Grant Street
Pittsburgh, PA 15219
Telecopier Number: 412-255-9805
Attention: John B. Corey
Vice President
with a copy to:
Armco Inc.
One Oxford Centre
301 Grant Street
Pittsburgh, PA 15219
Telecopier Number: 412-255-9805
Attention: Law Department
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<PAGE> 37
8.2 Interpretation. When a reference is made in this Agreement to
a section, schedule or exhibit, such reference shall be to a section, schedule
or exhibit of this Agreement unless otherwise indicated or unless the context
shall otherwise require. The table of contents and headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Whenever the words "include",
"includes" or "including" are used in this Agreement, they shall be deemed to
be followed by the words "without limitation".
8.3 Governing Law. This Agreement shall be governed and construed
in accordance with the laws of the State of Tennessee.
8.4 Publicity. So long as this Agreement is in effect, no party
shall issue or cause the publication of any press release or other public
announcement with respect to the transactions contemplated by this Agreement
without the consent of the other parties, unless, in the opinion of counsel,
such announcement is required by the provisions of applicable law or
regulations or by any governmental entity having jurisdiction over such party.
8.5 Assignment: Binding Effect. Neither this Agreement nor any of
the rights, interests or obligations hereunder shall be assigned by any of the
parties hereto without the prior written consent of the other parties, except
Purchaser may assign this Agreement to its Affiliates without prior written
consent; provided, however, that any such assignment will not relieve Purchaser
of its obligations or liabilities hereunder. This Agreement will be binding
upon, inure to the benefit of and be enforceable by the parties and their
respective successors and permitted assigns.
8.6 Entire Agreement: Third Party Beneficiaries. This Agreement
(including exhibits, schedules and documents referred to herein) constitutes
the entire agreement between the parties relating to the subject matter hereof
and supersedes all prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof and is not intended
to confer upon any person other than the parties hereto any rights or remedies
hereunder.
8.7 Construction. This Agreement is the result of arms-length
negotiations between the parties hereto and has been prepared jointly by the
parties. In applying and interpreting the provisions of this Agreement, there
shall be no presumption that the Agreement was prepared by any one party or
that the Agreement shall be construed in favor of or against any one party.
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<PAGE> 38
8.8 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
date first above written.
ARMCO INC.
By: /s/ John B. Corey
-----------------------------------------
FLOUR CITY ARCHITECTURAL METALS, INC.
By: [sig]
-----------------------------------------
FLOUR CITY INTERNATIONAL, INC.
By: [sig]
-----------------------------------------
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<PAGE> 1
EXHIBIT 10.3
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
FLOUR CITY INTERNATIONAL, INC.
AND
INTERNATIONAL FOREST INDUSTRIES, INC.
Dated as of April _____, 1997
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
I. DEFINITIONS..........................................................................1
II. THE MERGER TRANSACTION...............................................................2
2.1 Merger; Surviving Corporation.................................................2
2.2 The Closing...................................................................2
2.3 Effective Time; Effect of Merger..............................................3
2.4 Articles of Incorporation.....................................................3
2.5 By-Laws.......................................................................3
2.6 Directors and Officers........................................................3
2.7 Conversion of Shares..........................................................3
III. REPRESENTATIONS AND WARRANTIES OF IFI................................................4
3.1 Organization and Authorization................................................4
3.2 Non-Contravention.............................................................4
3.3 Capital Stock.................................................................4
3.4 Financial Statements..........................................................5
3.5 No Adverse Changes............................................................5
3.6 Approvals.....................................................................6
3.7 Taxes.........................................................................6
3.8 Contracts; Absence of Default.................................................7
3.9 Title to Assets...............................................................8
3.10 Litigation....................................................................8
3.11 Permits.......................................................................8
3.12 Corporate Records.............................................................8
3.13 Absence of Undisclosed Liabilities............................................9
3.14 Corporate Compliance..........................................................9
3.15 Regulatory Compliance.........................................................9
3.16 Conflict of Interest..........................................................9
3.17 Labor Matters.................................................................9
3.18 Benefit Plans................................................................10
3.19 Accuracy of Information Furnished............................................10
3.20 Brokers......................................................................10
3.21 Reorganization Representations of IFI........................................10
</TABLE>
i
<PAGE> 3
<TABLE>
<S> <C>
IV. SPECIAL MATTERS.....................................................................11
4.1 No-Shop......................................................................11
4.2 Payment of Certain Expenses..................................................11
V. REPRESENTATIONS AND WARRANTIES OF FCI...............................................11
5.1 Organization and Authorization...............................................11
5.2 Non-Contravention............................................................12
5.3 Capital Stock................................................................12
5.4 Unaudited Financial Statements and Stock Purchase Agreement..................12
5.5 No Adverse Changes...........................................................13
5.6 Litigation...................................................................13
5.7 Corporate Records............................................................13
5.8 Corporate Compliance.........................................................13
5.9 Accuracy of Information Furnished............................................13
5.10 Brokers......................................................................13
5.11 Reorganization Representations of FCI........................................13
VI. COVENANTS...........................................................................14
6.1 Negative Covenants of IFI and FCI............................................14
6.2 Additional Affirmative Covenants of FCI......................................14
6.3 Additional Affirmative Covenants of IFI......................................15
6.4 Access and Confidentiality...................................................15
6.5 Public Announcements.........................................................15
6.6 Expenses.....................................................................15
6.7 Survival of Representations and Warranties and Covenants; Indemnification....16
6.8 Reorganization Covenant......................................................17
6.9 Financial Covenants of IFI...................................................17
VII. CONDITIONS..........................................................................17
7.1 Conditions Precedent to the Obligations of All Parties.......................17
7.2 Additional Conditions Precedent to the Obligations of IFI....................18
7.3 Additional Conditions Precedent to the Obligations of FCI....................18
VIII. TERMINATION.........................................................................19
8.1 Termination by Mutual Consent................................................19
8.2 Termination by FCI...........................................................19
8.3 Effect of Termination........................................................19
</TABLE>
ii
<PAGE> 4
<TABLE>
<S> <C>
IX. GENERAL PROVISIONS..................................................................19
9.1 Notices......................................................................19
9.2 Amendment and Waiver.........................................................20
9.3 Counterparts.................................................................20
9.4 Assignability................................................................21
9.5 Entire Agreement.............................................................21
9.6 Applicable Law...............................................................21
9.7 Headings.....................................................................21
9.8 Attorneys' Fees..............................................................21
9.9 Further Assurances...........................................................21
</TABLE>
EXHIBITS:
A - Form of Plan of Merger
B - Issuance of IFI Common Stock to FCI Shareholders
C - Form of Articles of Merger
iii
<PAGE> 5
AGREEMENT AND PLAN OF MERGER (this "Agreement") made and entered into as
of the ______ day of April, 1997 by and among International Forest Industries,
Inc., a Nevada corporation ("IFI"), and Flour City International, Inc., a Nevada
corporation ("FCI").
WHEREAS, in order that IFI may acquire all of the capital stock of FCI,
and FCI desires that FCI merge with and into IFI pursuant to the terms and
conditions set forth in this Agreement and in accordance with the laws of the
State of Nevada (the "Merger"); and
WHEREAS, the parties intend that the Merger will constitute a
reorganization under the provisions of Section 368 of the Internal Revenue Code
of 1986, as amended;
NOW, THEREFORE, in consideration of the premises and the
representations, warranties and agreements herein contained, the parties hereby
agree as follows:
I. DEFINITIONS
For purposes of this Agreement, the following terms shall have the
meanings set forth:
"Articles of Merger" shall mean the Articles of Merger to be entered
into by and between the Constituent Corporations as provided in Section 2.2, in
substantially the Form attached hereto as Exhibit "C."
"Closing" and "Closing Date" shall have the meanings set forth in
Section 2.2.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Constituent Corporations" shall mean both FCI and IFI.
"Conversion Ratio" shall have the meaning set forth in Section 2.7.
"Effective Time" shall have the meaning set forth in Section 2.3.
"FCI Common Stock" shall mean the common stock, $.0001 par value, of
FCI.
"IFI" shall have the meaning set forth in the preface of this Agreement.
"IFI Common Stock" shall mean the Common Stock, $.001 par value, of IFI.
"IFI Financial Statements" shall mean Financial Statements of IFI
referred to in Section 3.4, including the notes thereto.
"Knowledge" or "to the knowledge" of a party shall mean any item of
which any executive officer of FCI or IFI has actual knowledge or of which such
executive officer would have discovered following reasonable inquiry.
<PAGE> 6
"Merger" shall have the meaning set forth in the preambles hereto and
more fully described in Section 2.1.
"Ordinary course of business" or similar reference shall mean consistent
with past custom and practice, including with respect to quantity and frequency.
"Plan of Merger" shall mean the Plan of Merger to be entered into by and
between the Constituent Corporations as provided in Section 2.2, in
substantially the form attached hereto as Exhibit A.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Surviving Corporation" shall have the meaning set forth in Section 2.1.
"Surviving Corporation Common Stock" shall mean the common stock of the
Surviving Corporation.
"Tax" or "Taxes" shall mean a net income, gross income, gross receipts,
sales, use, ad valorem, franchise, profits, license, withholding, payroll,
employment, excise, severance, stamp, transfer, occupation, real property,
premium, property or windfall profit tax, custom duty, or other tax,
governmental fee or other like assessment or charge of any kind whatsoever,
together with any interest and any penalty, additional tax or additional amount
imposed by any jurisdiction or other taxing authority (federal, state, local or
foreign).
II. THE MERGER TRANSACTION
2.1 Merger; Surviving Corporation. Pursuant to the provisions of this
Agreement and in accordance with Nevada Corporate Law, at the Effective Time FCI
shall be merged with and into IFI. IFI shall be the corporation surviving the
Merger (the "Surviving Corporation") and shall maintain its corporate existence
under the laws of the State of Nevada.
2.2 The Closing.
(a) Subject to the conditions set forth in Article VII, unless
this Agreement shall have been terminated as provided in Article VIII, the
consummation of the transactions contemplated by this Agreement (the "Closing")
shall take place at the offices of Manning, Marder & Wolfe, 707 Wilshire
Boulevard, 45th Floor, Los Angeles, California, commencing at 9:00 a.m., on
April ____, 1997 or such other place or such other date as the parties may
mutually determine (the "Closing Date").
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(b) At the Closing, (i) IFI shall deliver to FCI the various
certificates, instruments and documents referred to in Section 7.3, and shall
deliver to FCI share certificates as set forth in Exhibit B hereto of IFI
representing 27,980,667 shares of IFI Common Stock, which shall be validly
issued and fully paid and nonassessable, free and clear of any lien or other
encumbrance and (ii) the Constituent Corporations shall cause a properly
executed Plan of Merger and Articles of Merger (together with such certificates
and other documents as may be required by law to effectuate the merger) to be
filed with the Secretary of State of the State Nevada.
2.3 Effective Time; Effect of Merger. The Merger shall become effective
at the time (the "Effective Time") the Constituent Corporations file the
Articles of Merger with the Secretary of State of the State of Nevada. At the
Effective Time, the separate existence of FCI shall cease. All properties,
franchises and rights belonging to FCI by virtue of the Merger and without
further act or deed, shall be deemed to be vested in the Surviving Corporation,
which shall thenceforth be responsible for all of the liabilities and
obligations of FCI. The Surviving Corporation may, at any time after the
Effective Time, take any action (including executing and delivering any
document) in the name and on behalf of either of the Constituent Corporations in
order to carry out and effectuate the transactions contemplated by this
Agreement.
2.4 Articles of Incorporation. The Articles of Incorporation of IFI in
effect immediately prior to the Effective Time shall be the Articles of
Incorporation of the Surviving Corporation until amended in accordance with the
provisions thereof and as set forth in the Plan of Merger and Articles of Merger
which are Exhibits A and C hereto, respectively.
2.5 By-Laws. The By-Laws of FCI as in effect immediately prior to the
Effective Time shall be the By-Laws of the Surviving Corporation until further
amended in accordance with the provisions thereof and of the Articles of
Incorporation of the Surviving Corporation.
2.6 Directors and Officers.
(a) The Board of Directors of the Surviving Corporation from and
after the Effective Time shall consist of the persons who are members of the
Board of Directors of FCI as of the Effective Time. Such directors shall serve
until their resignation, removal or failure to be reelected and until their
respective successors are duly elected or appointed and qualified in accordance
with the Articles of Incorporation and By-Laws of the Surviving Corporation.
(b) The persons who are officers of FCI as of the Effective Time
shall continue in the same capacity as officers of the Surviving Corporation
until the Board of Directors of the Surviving Corporation shall otherwise
determine. Other persons may be elected or appointed to other offices from time
to time in accordance with the By-Laws of the Surviving Corporation.
2.7 Conversion of Shares.
At and as of the Effective Time, each share of FCI shall be
converted into the right
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<PAGE> 8
to receive 2.7980667 IFI Common Shares. No FCI shares shall be deemed to be
outstanding or to have any rights after the Effective Time.
III. REPRESENTATIONS AND WARRANTIES OF IFI
IFI hereby represents and warrants to FCI as follows:
3.1 Organization and Authorization.
IFI is a corporation duly organized, validly existing and in good
standing under the laws of Nevada, has the corporate power and all necessary
corporate authorizations to own all of its properties and assets and to carry on
its business as it is now being conducted. IFI is duly qualified to do business
and is in good standing in each jurisdiction in which the nature of its business
or character of its properties requires such qualification and where the failure
to be so qualified would materially and adversely affect IFI, its business,
properties or rights. IFI has delivered to FCI complete and correct copies of
IFI's Articles of Incorporation and By-Laws, as amended and in effect on the
date of this Agreement. IFI has all requisite corporate power to execute,
deliver and perform its obligations under this Agreement. The execution,
delivery and performance of this Agreement by IFI, and the consummation by IFI
of the transactions contemplated hereby have been duly authorized by the Board
of Directors and shareholders of IFI. This Agreement has been duly executed and
delivered by IFI and constitutes a valid and binding agreement of IFI.
3.2 Non-Contravention. The execution and delivery of this Agreement do
not and the consummation of the transactions contemplated hereby will not (a)
violate the Articles of Incorporation or By-Laws of IFI (b) violate any material
provision of or result in the breach or the acceleration of or entitle any party
to accelerate (whether after the giving of notice or the lapse of time or both)
any obligation under any material mortgage, lease, agreement, license or
instrument, or any order, arbitration award, judgment, or decree, to which IFI
is a party or by which it is bound, (c) result in the creation or imposition of
any lien, charge, pledge, security interest or other encumbrance on any material
property of IFI or (d) to the knowledge of IFI violate or conflict with any law,
ordinance or rule to which IFI is subject.
3.3. Capital Stock.
(a) The authorized and outstanding capital stock of IFI consists
of 50,000,000 shares of Common Stock, $.001 par value. As of the date of this
Agreement there is 25,360,000 shares of Common Stock issued and outstanding
which are validly issued, fully paid and nonassessable. Prior to the Closing IFI
shall have completed all actions required to effect a 1 for 10 reverse stock
split resulting in 2,536,000 shares of Common Stock issued and outstanding
immediately prior to the Closing. There are sufficient authorized but unissued
shares of IFI Common Stock to permit the issuance of all shares required to be
issued in accordance with the terms and conditions of this Agreement to FCI upon
consummation of the Merger.
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<PAGE> 9
(b) There are no outstanding subscriptions, options, conversion
rights, warrants or other agreements or commitments of any nature whatsoever
obligating IFI to issue, deliver or sell, or cause to be issued, delivered or
sold, any additional shares of the capital stock of IFI or obligating IFI to
grant, extend or enter into any such agreement or commitment. No preemptive or
similar rights exist or will arise as a result of the transactions contemplated
by this Agreement. There are no voting trusts, voting agreements, irrevocable
proxies or other agreements to which IFI is a party, or of which IFI has
knowledge, in effect relating to the voting or transfer of any shares of IFI
Common Stock.
(c) The Shares of IFI Common Stock to be delivered pursuant to
the Merger will, upon issuance, be validly issued, fully paid and nonassessable.
3.4 Financial Statements. IFI has previously furnished FCI with its
audited Balance Sheets as of December 31, 1994, December 31, 1995, and September
30, 1996 and the related Statements of Operations, Stockholders' Equity and Cash
Flows for the period January 1, 1996 to September 30, 1996 and for the two years
ended December 31, 1994 and December 31, 1995 (collectively the "IFI Financial
Statements"). The IFI Financial Statements (a) were prepared in accordance with
the books and records of IFI; and (b) have been prepared in accordance with
generally accepted accounting principles ("GAAP") applied on a consistent basis
throughout the periods covered thereby. The IFI Financial Statements present
fairly the financial position of IFI as of the dates thereof and the results of
operations and changes in financial position of IFI for the periods then ended.
The balance sheet of IFI as of September 30, 1996 is sometimes referred to
herein as the "Latest IFI Balance Sheet."
3.5 No Adverse Changes. Except as contemplated herein, since the date of
the Latest IFI Balance Sheet, IFI has conducted its business only in the
ordinary course, there has not been any material adverse change in the financial
condition, assets, liabilities, properties, business or operations of IFI and
IFI has not:
(a) issued or sold any stock, notes, bonds or other securities,
or any option to purchase the same, or entered into any agreement with respect
thereto, with the exception of 7,500,000 Common Shares sold pursuant to Rule 504
of Regulation D;
(b) declared, set aside or made any dividend or other
distribution on capital stock or redeemed, purchased or acquired any shares
thereof or entered into any agreement in effect to the foregoing, with the
exception of that certain assignment of assets to a trust for the benefit of the
existing IFI shareholders declared and effective as of April ____, 1997;
(c) amended its Articles of Incorporation or By-Laws;
(d) incurred any material obligation or liability (absolute or
contingent);
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<PAGE> 10
(e) entered into any contract or agreement other than contracts
or commitments made pursuant to this Agreement;
(f) made any payment or arrangement, agreement or commitment to
pay any bonus, incentive compensation or retirement, termination or severance
benefits;
(g) borrowed or loaned any money;
(h) changed its method of accounting; or
(i) agreed, whether in writing or otherwise, to take any action
described in this Section 3.5.
3.6 Approvals. Except for the approval by the IFI shareholders and the
filing of the Articles of Merger with the Nevada Secretary of State, no consent,
approval, order or authorization of, or registration, declaration or filing with
any governmental authority is required in connection with the execution and
delivery of this Agreement by IFI or the consummation by IFI of the transactions
contemplated hereby.
3.7 Taxes. (a) IFI has filed or will, before the Closing Date, file all
material returns, declarations, reports and information returns and statements
required by law to be filed by it before the Closing Date (taking into account
any extension for time of filing granted by any appropriate taxing authority)
relating to any Taxes with respect to any income, properties or operations of
IFI before the Closing Date (collectively, the "Returns"), and all such Returns
were, or will be, correct and complete in all material respects; (b) IFI has
timely paid (taking into account any extension for time of filing granted by any
appropriate taxing authority) in full Taxes that have been shown as due and
payable on Returns that have been filed and is not delinquent in the payment of
any amount of Taxes attributable to any settlement with governmental
authorities; (c) all other material Taxes due and payable by IFI for any taxable
period ending on or before the Closing Date (taking into account any extension
for time of filing granted by any appropriate taxing authority) have been, or
will have been, paid in full unless such Taxes are being contested or have been
reserved for on IFI's Financial Statements; (d) all material Taxes required to
be withheld by or on behalf of IFI or with respect to the business operated by
IFI or the assets thereof have been withheld, and such withheld Taxes have been
duly paid to the proper governmental authority or set aside in accounts for such
purpose; (e) no Returns or Taxes for which IFI could be held liable is currently
being audited by any taxing authority and no taxing authority has given notice
in writing that it will commence any such audit; (f) the charges, accruals and
reserves for Taxes (including deferred Taxes) currently reflected on the books
of IFI, if any, are and will be as of the Closing Date, adequate in accordance
with generally accepted accounting principles, consistently applied, to cover
all unpaid liabilities for Taxes accruing or payable by IFI in respect of
periods that end on or before the Closing Date (except for any Taxes payable as
a result of any event occurring on the Closing Date, but after the Closing,
which is outside the ordinary course of business) and for periods that begin
before the Closing Date and end after the Closing Date to the extent that such
Taxes are attributable to the portion of any such period ending
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at the Closing Date; for purposes of this subsection (f), in the case of a
period that begins before the Closing Date and ends after the Closing Date, the
Taxes attributable to the portion of the period ending at the Closing Date shall
be determined by closing the books of IFI on the Closing Date and determining
the Taxes that would have been imposed on IFI if the period ending at the
Closing Date had been a separate taxable year; except, however, in the case of
any property taxes, the amount attributable to the portion of the period ending
at the Closing Date shall be equal to the total amount of such property taxes
for the period in question multiplied by a fraction, the numerator of which is
the number of days from the beginning of the period through the Closing Date,
and the denominator of which is the total number of days in the period; (g) no
deficiency for any amount of material Taxes has been proposed, asserted or
assessed in writing against IFI; (h) IFI has not granted an extension of the
limitations period applicable to the assessment of Taxes; (i) IFI has not been a
party to any tax sharing arrangement; (j) IFI has not made any election under
Section 341(f) of the Code; (k) there are no elections in effect made by or with
respect to IFI pursuant to Section 338 or 336(e) of the Code or the regulations
thereunder and, prior to the Closing Date, IFI will not be subject to any
constructive elections under Section 338 of the Code or regulations thereunder;
(1) none of the property of IFI is subject to a lease under (i) Section
168(f)(8) of the Internal Revenue Code of 1954 as in effect prior to the date of
enactment of the Tax Reform Act of 1982, or (ii) Section 7701(h) of the Code;
(m) IFI is not nor has been a member of any affiliated group for purposes of
filing tax returns or paying Taxes at any time other than the affiliated group
of which IFI is the common parent; and (o) there are no liens for delinquent
Taxes upon the assets of IFI.
3.8 Contracts; Absence of Default. IFI is not a party to any material
written or oral:
(a) contract, agreement or understanding for the employment of any
officer, consultant, director, employee or any other person;
(b) contract, agreement or understanding with any labor union;
(c) contract, agreement or understanding for the purchase of any
materials, supplies, equipment, personal property or real property;
(d) contract, agreement or understanding for the sale of products or
performance of services;
(e) license or franchise agreement, either as licensor or licensee
or franchisor or franchisee, or distributor, or sales agency contract;
(f) lease under which IFI is a lessor or lessee of real property or
personal property, or contract, agreement or understanding to purchase or sell
real property or personal property;
(g) pension, profit-sharing, bonus, deferred compensation,
retirement or stock option or stock purchase plan in effect with respect to
employees or others;
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(h) contract or agreement granting to any person, or obtaining from
any person, the right to use any property or property right, including any
trademark, trade secret, know-how, software, or patent licensing agreement,
contract or understanding;
(i) plan or contract or other arrangement providing for insurance
for any officer director or employee or member of their families;
(j) contract or agreement containing covenants by IFI not to compete
in any line of business or with any person;
(k) partnership, joint venture contract or arrangement or other
agreement involving a sharing of profits;
(l) contract or agreement relating to the borrowing or lending of
money; or
(m) other material contract, agreement or understanding which
requires by its terms the payment of more than $100.00 during any twelve-month
period or has a term of more than twelve months.
3.9 Title to Assets. IFI owns and has good and marketable title to all
of its assets and properties (real, personal and mixed, tangible or intangible),
reflected in the IFI Financial Statements free and clear of any mortgage, lien,
pledge, charge, claim, conditional sales or other agreement, lease, right or
encumbrance, except to the extent stated or reserved against in the IFI
Financial Statements.
3.10 Litigation. There are no actions, suits or proceedings or
investigations pending or, to the knowledge of IFI threatened against or
affecting the business or financial condition of IFI at law or in equity in any
court or before any foreign, federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality. IFI is not in
default in respect of any judgment, order, writ, injunction or decree of any
court or any foreign, federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality.
3.11 Permits. IFI has all permits, licenses, orders and approvals of all
foreign, federal, state, or local governmental or regulatory bodies required for
it to conduct its business as presently conducted, the absence of which would
have a material adverse effect on the business or financial condition of IFI all
such permits, licenses, orders and approvals are in full force and effect and no
suspension or cancellation of any of them is threatened; and such permits,
licenses, orders or approvals will not be adversely affected by the consummation
of the transactions contemplated by this Agreement.
3.12 Corporate Records. The minute books of IFI contain complete and
accurate records of all material corporate actions taken at all meetings, all
actions by written consent without a
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meeting, and all other material corporate actions taken by the Board of
Directors and shareholders of IFI.
3.13 Absence of Undisclosed Liabilities. Except as and to the extent
reflected or reserved against in the IFI Financial Statements, IFI had as of the
dates of such financial statements, no liabilities or obligations, whether
accrued, contingent or otherwise required by GAAP to be reflected in the IFI
Financial Statements or otherwise material to IFI. As of the date of this
Agreement, IFI does not have any liabilities or obligations, whether accrued,
contingent or otherwise, except as provided for in the preceding sentence and
for such liabilities or obligations as have arisen in the ordinary course of
business since the date of the Latest Balance Sheet, none of which newly arisen
liabilities or obligations has a material adverse effect upon the business or
financial condition of IFI.
3.14 Corporate Compliance. IFI is not in violation of, or in default
under, any term or provision of its Articles of Incorporation or By-Laws.
3.15 Regulatory Compliance. To its knowledge, IFI is in compliance in
all material respects with all federal, state, local and foreign laws and
regulations applicable to it, including, without limitation, environmental laws.
IFI has not generated, used, handled, treated or stored hazardous waste or
hazardous substance (as hereinafter defined) and/or oil at, on or in any site
currently or formerly owned, leased or used by IFI or shipped the same for
treatment, storage or disposal at any other site or facilities other than those
generated, used, handled, treated or stored in the ordinary course of business
which was in compliance in all material respects with the laws and regulations
relating to hazardous waste and hazardous substances. For the purpose of this
Section 3.15, "hazardous waste" and "hazardous substance" shall have the
meanings set forth in the Resource Conservation and Recovery Act, 42 U.S.C.
SectionSection 6901, et seq., and the Comprehensive Environmental Response,
Compensation, and Liability Act, 42 U.S.C. SectionSection 9601 et seq., and any
federal regulations adopted pursuant to or in furtherance of such acts as such
statutes or regulations may be amended, or as defined in any state or local
statutes or regulations governing such waste and substances.
3.16 Conflict of Interest.
(a) No director or officer of IFI or, to the knowledge of IFI any
employee of IFI, has any interest in any material property, real or personal or
tangible or intangible necessary for, used in or pertaining to the business of
IFI; and
(b) No director or officer of IFI, or to the knowledge of IFI,
employee of IFI, (i) competes with IFI in any line of business, or (ii) is a
party to any IFI contract, nor does any director or officer of IFI, or, to the
knowledge of IFI, any employee of IFI have an ownership interest, direct or
indirect, in any entity which competes with IFI in any line of business or is a
party to any IFI contract.
3.17 Labor Matters. There are no disputes pending or, to the knowledge
of IFI, threatened, between IFI and any of its former employees. To the
knowledge of IFI, IFI is in compliance with
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all applicable labor laws the failure to comply with which would have a material
adverse effect on the business or financial condition of IFI. IFI is not a party
to any collective bargaining agreements.
3.18 Benefit Plans.
(a) IFI is not a party to any compensation, bonus, pension, profit
sharing, retirement, savings, stock option, stock purchase, severance, bonus,
medical, dental, health benefit, disability, income, vacation, holiday, leave of
absence, expense reimbursement, automobile or other transportation allowance, or
similar plans, procedures, programs or agreements (the "IFI" Employee Benefit
Plans").
(b) IFI does not maintain or contribute to any "employee welfare
benefit plan" as defined in Section 3(1) of the Employee Retirement Income
Security Act of 1974 ("ERISA") (a "Welfare Benefit Plan"), pursuant to
collective bargaining agreement or otherwise, providing benefits to retirees or
former employees.
(c) IFI has administered all former IFI Employee Benefit Plans, if
any, in compliance in all material respects with applicable law, including but
not limited to ERISA, and with respect to each such plan all applicable
reporting and disclosure obligations have been satisfied in all material
respects.
(d) There is no pending or, to the knowledge of IFI, threatened
litigation against IFI, with respect to any IFI Employee Benefit Plan and no
such plan has been the subject of an audit, investigation or other proceeding by
any governmental agency.
3.19 Accuracy of Information Furnished. The certificates, statements and
other information furnished to FCI in writing by or on behalf of IFI do not to
the knowledge of IFI contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
3.20 Brokers. All negotiations relating to this Agreement and the
transactions contemplated hereby have been carried on without the intervention
of any person acting on behalf of IFI who has or may have a valid claim against
FCI or the Surviving Corporation for any broker's or finder's fee or similar
compensation.
3.21 Reorganization Representations of IFI. IFI does not own, directly
or indirectly, and has not owned directly or indirectly during the past five
years, any shares of FCI Common Stock. The fair market value of the IFI Common
Stock received by FCI shareholders will be approximately equal to the fair
market value of the FCI Common Stock surrendered in the Merger. IFI has no plan
or intention to reacquire any of the IFI Common Stock issued in the Merger. IFI
has no plan or intention to cause the Surviving Corporation to issue shares of
its stock that would result in IFI owning less than 80% of the Surviving
Corporation's stock by vote or value. Immediately following the Merger, the
Surviving Corporation will hold all of FCI's net assets and gross assets. IFI
has no
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present plan or intention to liquidate the Surviving Corporation, to merge the
Surviving Corporation with or into another corporation, to sell or otherwise
dispose of any of the stock of the Surviving Corporation, in each case except
for transfer of stock to corporations controlled by IFI, except for dispositions
made in the ordinary course of business or transfers of assets to a corporation
controlled by the Surviving Corporation. IFI is not an investment company as
defined in Section 368(a) (2) (F) (iii) and (iv) of the Code.
IV. SPECIAL MATTERS
4.1 No-Shop. IFI agrees, severally, for the benefit of FCI that IFI will
not, directly or indirectly, prior to the termination of this Agreement as
provided in Article VIII, (i) sell, transfer, pledge, encumber or otherwise
dispose of any shares and capital stock of IFI, or discuss or negotiate with any
other corporation, person (other than its professional advisors) or firm (other
than representatives of FCI) or entertain or consider any inquiry or proposals,
regarding the possible disposition of such shares or the business or all or
substantially all of the assets of IFI, or a merger or combination of IFI, or an
acquisition of IFI by another party; (ii) provide any information relating to
the possible sale of IFI or its business, or all or substantially all of the
assets of IFI, to any potential third-party purchaser or to disclose to any
potential third-party purchaser that IFI, or all or any significant portion of
the assets of IFI, is or may be for sale; or (iii) intentionally take any action
which is inconsistent with the obligations of IFI hereunder.
4.2 Payment of Certain Expenses. If the closing does not occur, each
party shall pay its or his own expenses for legal, accounting and other
professional fees incurred in connection with this Agreement.
V. REPRESENTATIONS AND WARRANTIES OF FCI
FCI hereby represents and warrants to IFI as follows:
5.1 Organization and Authorization.
(a) FCI is a corporation duly organized, validly existing and in
good standing under the laws of the State of Nevada, has the corporate power and
all necessary authorizations to own all of its properties and assets and to
carry on its business as it is now being conducted. FCI is duly qualified to do
business and is in good standing in each jurisdiction in which the nature of its
business or character of its properties requires such qualification and where
the failure to be so qualified would materially and adversely affect FCI its
businesses, properties or rights. FCI has delivered to IFI complete and correct
copies of its Articles of Incorporation and By-Laws, as amended and in effect on
the date of this Agreement. FCI has all requisite corporate power to execute,
deliver and perform its obligations under this Agreement. The execution,
delivery and performance of this Agreement by FCI, and the consummation by FCI
of the transactions
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contemplated hereby have been duly authorized by the Board of Directors of FCI.
This Agreement has been duly executed and delivered by FCI and upon the approval
of the FCI shareholders will constitute a valid and binding agreement of FCI.
(b) FCI owns 100% of the issued and outstanding capital stock of
Flour City Architectural Metals, Inc. ("FCAM"), a Delaware corporation, and
Hockley International Limited ("HIL"), a British Virgin Islands corporation.
5.2 Non-Contravention. The execution and delivery of this Agreement do
not and the consummation of the transactions contemplated hereby will not (a)
violate the Articles of Incorporation or By-Laws of FCI (b) violate any
provision of or result in the breach or the acceleration of or entitle any party
to accelerate (whether after the giving of notice or the lapse of time or both)
any obligation under any mortgage, lease, agreement, license or instrument, or
any order, arbitration award, judgment, or decree, to which FCI is a party or by
which either of them is bound, (c) result in the creation or imposition of any
lien, charge, pledge, security interest or other encumbrance on any property of
FCI or (d) violate or conflict with any law, ordinance or rule to which FCI or
the property of FCI is subject.
5.3 Capital Stock.
(a) The authorized capital stock of FCI consists of 25,000,000
shares of Common Stock, $.0001 par value, and 5,000,000 shares of Preferred
Stock, $.0001 par value. As of the date of this Agreement there is 10,000,000
shares of Common Stock issued and outstanding which are validly issued, fully
paid and nonassessable.
(b) There are no outstanding subscriptions, options, conversion
rights, warrants or other agreements or commitments of any nature whatsoever
obligating FCI to issue, deliver or sell, or cause to be issued, delivered or
sold, any additional shares of the capital stock of FCI or obligating FCI to
grant, extend or enter into any such agreement or commitment. No preemptive or
similar rights exist or will arise as a result of the transaction contemplated
by this Agreement. There are no voting trusts, voting agreements, irrevocable
proxies or other agreements to which FCI is a party, or of which FCI has
knowledge, in effect relating to voting or transfer of any shares of FCI Common
Stock.
5.4 Unaudited Financial Statements and Stock Purchase Agreement. The
unaudited consolidated profit and loss accounts and balance sheets for HIL for
the years ending October 31, 1993, 1994, 1995 and 1996 (collectively the "HIL
Financial Statements") which have been previously provided to IFI to the
knowledge of FCI present fairly the financial position of HIL as of the dates
thereof and the results of operations of FCI for the periods then ended; subject
to any adjustments therein which may be required upon an audit of the foregoing
financial statements, which adjustments may be material. The Stock Purchase
Agreement (the "FCI-SPA") among Armco, Inc., FCAM and FCI effective January 1,
1997 which has been previously provided to IFI
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to the knowledge of FCI represents the terms and conditions of FCI's acquisition
of FCAM from Armco, Inc.
5.5 No Adverse Changes. Since the dates of the HIL Financial Statements
and the FCI- SPA, FCI has conducted its business only in the ordinary course,
and there has not been any material adverse changes in the business, financial
condition, assets, liabilities, properties or operations of FCI.
5.6 Litigation. Except as set forth in the FCI-SPA, there are no
material actions, suits or proceedings or investigations pending or, to the
knowledge of FCI, threatened against or affecting the business, operations or
financial condition of FCI at law or in equity in any court or before any
foreign, federal, state, municipal or other governmental department, commission,
board, bureau, agency or instrumentality. FCI is not in default in respect of
any judgment, order, writ, injunction or decree of any court or any foreign,
federal, state, municipal or other governmental department, commission, board,
bureau, agency or instrumentality.
5.7 Corporate Records. The minute books of FCI made available to IFI or
its legal counsel to review contained complete and accurate records of all
material corporate actions taken at all meetings, all actions by written consent
without a meeting, and all other material corporate actions taken by the Board
of Directors and shareholders of FCI.
5.8 Corporate Compliance. FCI is not in violation of, or in default
under, any term or provision of its Articles of Incorporation or By-Laws.
5.9 Accuracy of Information Furnished. The certificates, statements, and
other information furnished to IFI in writing by or on behalf of FCI in
connection with the transactions contemplated hereby, do not to the knowledge of
FCI contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in light of the circumstances
under which they are made, not misleading; provided, however, that no
representation is made as to the accuracy of any financial projections contained
in such information.
5.10 Brokers. All negotiations relating to this Agreement and the
transactions contemplated hereby have been carried on without the intervention
of any person acting on behalf of FCI who has or may have a valid claim against
IFI or the Surviving Corporation for any broker's or finder's fee or similar
compensation.
5.11 Reorganization Representations of FCI. There is no intercorporate
indebtedness existing between IFI and FCI. FCI is not an investment company as
defined in Section 368(a) (2) (F) (iii) and (iv) of the Code. FCI is not under
the jurisdiction of a court in a Title 11 or similar case. The fair market value
of the assets of FCI exceeds and will exceed as of the Effective Time the sum of
its liabilities plus the amount of liabilities, if any, to which the assets are
subject. Any liabilities of FCI assumed by the Surviving Corporation and any
liabilities to which the transferred assets of FCI are subject were incurred by
FCI in the ordinary course of its business.
13
<PAGE> 18
VI. COVENANTS
6.1 Negative Covenants of IFI and FCI. From the date of this Agreement
until the Effective Time, except with the prior written consent of the other
parties or as expressly permitted by this Agreement, IFI and FCI each hereby
covenant and agree that it will not:
(a) declare or pay any dividends or effect any stock split or other
reclassification;
(b) merge or consolidate with any corporation;
(c) make any acquisition of stock or assets of any person or entity;
(d) authorize the creation or issuance of or issue, sell or dispose
of, or create any obligation to issue, sell or dispose of, any shares of its
capital stock except pursuant to conversion rights, options or other commitments
or agreements existing on the date of this Agreement.
(e) incur any indebtedness for borrowed money other than in the
ordinary course of business or in connection with transactions disclosed
hereunder or contemplated herein;
(f) enter into or amend any employment contract with any of its
officers, increase the salary of any officer other than in the ordinary course
of business, adopt or amend in any material respect (except as required by law)
any employee benefit plan, severance plan or collective bargaining agreement or
make awards or distributions under any employee benefit plan not consistent with
past practice or custom;
(g) amend its Articles of Incorporation or By-Laws;
(h) dispose of any material assets or otherwise conduct its business
in a manner that is not consistent with past practices; or
6.2 Additional Affirmative Covenants of FCI. In addition to the
covenants set forth in Section 6.1, FCI hereby covenants and agrees that from
the date of this Agreement until the Effective Time (or until the items referred
to have either been accomplished or, in good faith, abandoned), except with the
prior written consent of IFI:
(a) shall use all reasonable efforts to comply with all applicable
federal or state filing requirements imposed on FCI with respect to the Merger,
and cooperate with and promptly furnish information to IFI in connection with
any such filing requirements imposed upon IFI in connection with the Merger; and
(b) shall (i) promptly advise IFI orally and in writing of any
inquiry or proposal for the acquisition of its stock, assets or business; (ii)
use all reasonable efforts to obtain any consent, authorization or approval of,
or exemption by, any governmental authority or agency or other third
14
<PAGE> 19
party required to be obtained or made by in connection with the Merger or the
taking of any action in connection with the consummation thereof; and (iii) use
all reasonable efforts to cause the conditions precedent to the Merger to be
fulfilled.
6.3 Additional Affirmative Covenants of IFI. In addition to the
covenants set forth in Section 6.1, IFI hereby covenants and agrees that from
the date of this Agreement until the Effective Time (or until the items referred
to have either been accomplished or, in good faith, abandoned), except with the
prior written consent of FCI, it shall use all reasonable efforts to comply with
all filing requirements which federal or state law may impose on IFI with
respect to the Merger, and cooperate with and promptly furnish information to
FCI in connection with any such filing requirements imposed upon FCI in
connection with the Merger.
6.4 Access and Confidentiality.
(a) From the date of this Agreement to the Effective Time, FCI shall
afford to IFI and to the officers and authorized representatives of IFI
(including, without limitation, counsel, financial advisors and independent
accountants) full access to its properties, personnel, books and records at such
reasonable times and in such manner as not to disrupt normal business
operations; and the officers of FCI will furnish such officers and
representatives with such additional financial and operating data and other
information as to its business and properties as may be reasonably requested.
Similarly, from the date of this Agreement to the Effective Time, IFI shall
afford to FCI and to FCI's officers and authorized representatives (including,
without limitation, counsel, financial advisors and independent accountants)
full access to its properties, personnel, books and records at such reasonable
times and in such manner as not to disrupt normal business operations; and the
officers of IFI will furnish such officers and representatives with such
additional financial and operating data and other information as to its business
and properties as may be reasonably requested.
(b) FCI and IFI shall at all times prior to the Effective Time and,
in the event the transactions contemplated by this Agreement are not
consummated, at all times thereafter, keep confidential all confidential or
proprietary information furnished to it by the other party in connection with
this Agreement and the transactions contemplated hereby, and will not disclose
such confidential or proprietary information to any third party without the
prior written consent of the other party. In addition, in the event of
termination of this Agreement, all non-public documents (including copies
thereof) and other non-public written information obtained hereunder by any
party from any other party shall be returned to such party.
6.5 Public Announcements. Each of the parties hereto will obtain the
prior written approval from the other parties before issuing any press release
or otherwise making any public statements with respect to the Merger prior to
the Effective Time.
6.6 Expenses. Subject to Section 4.3 hereof, each of the parties hereto
shall pay all of its own costs and expenses incurred in connection with the
Merger, this Agreement and the
15
<PAGE> 20
transactions contemplated thereby or hereby.
6.7 Survival of Representations and Warranties and Covenants;
Indemnification.
(a) The parties hereto hereby acknowledge and agree that the
representations and warranties and covenants set forth in this Agreement shall
survive the Closing Date for a period of 24 months, provided that, any covenant
contained herein that is to be performed after the Closing Date shall survive
for a period of 24 months from the date or expiration of the period upon or
during which such covenant is to be performed.
(b) The following individual directors of IFI, Andrew W. Berney,
Bruce Barton and John M. Eckert (the "IFI Directors") jointly and severally
hereby agree to indemnify, defend, save and hold the Surviving Corporation
harmless from and against any and all damage, liability, loss, expense,
assessment, judgment or deficiency of any nature whatsoever (including without
limitation, reasonable attorneys' fees and other costs and expenses incident to
any suit, action or proceeding) actually paid or incurred or sustained by the
Surviving Corporation which shall arise out of, or result from, any breach with
respect to which notice has been given within the 24-month period following the
Closing Date of any representation, warranty or covenant of IFI in this
Agreement.
(c) The following individual directors of FCI, John Tang and Michael
Russo (the "FCI Directors") jointly and severally hereby agree to indemnify,
defend, save and hold the Surviving Corporation harmless from and against any
and all damage, liability, loss, expense, assessment, judgment or deficiency of
any nature whatsoever (including without limitation, reasonable attorneys' fees
and other costs and expenses incident to any suit, action or proceeding)
actually paid or incurred or sustained by the Surviving Corporation which shall
arise out of, or result from, any breach with respect to which notice has been
given within the 24-month period following the Closing Date of any
representation, warranty or covenant of FCI in this Agreement.
(d) Promptly after service of notice within the 24-month period
following the Closing Date of any claim or of process by any third party in any
matter in respect of which indemnity may be sought from a party pursuant to this
Agreement, the party so served shall notify the indemnifying party of the
receipt thereof. The indemnifying party shall have the right to participate in,
or assume, at its own expense, the defense of any such claim or process or
settlement thereof. Such defense shall be conducted expeditiously (but with due
regard for obtaining the most favorable outcome reasonably likely under the
circumstances, taking into account costs and expenditures) and the indemnified
party shall be advised promptly of all developments. In the event that the
indemnifying party assumes the defense of the indemnified party, then the
indemnified party shall retain the right to participate, at its own cost and
expense, in such defense. Notwithstanding any provision to the contrary set
forth herein, the obligations of the indemnifying party hereunder shall be
subject to and conditioned upon its receipt of timely notice of such claim or
process and in the event that the failure to give such timely notice materially
and adversely affects the ability of the indemnifying party to defend such claim
or materially increases the amount of indemnification
16
<PAGE> 21
which the indemnifying party is obligated to pay hereunder, said indemnifying
party shall have no indemnification obligations whatsoever with respect to such
claim. No settlement of any such claim as to which the indemnifying party has
not elected to assume the defense thereof shall be made without the prior
written consent of the indemnifying party, which consent shall not be
unreasonably withheld or delayed. In addition, in the event of such a settlement
without the prior written consent of the indemnifying party, the indemnifying
party shall have no indemnification obligation whatsoever with respect to such
claim.
(e) In determining the amount of loss subject to indemnity under
this Section 6.7, the parties shall make appropriate adjustments for any
recoveries received by the indemnified party under insurance policies. In
addition, the amount of loss subject to indemnity under this Section 6.7 shall
be adjusted to reflect any tax benefits received by the indemnified party as a
result of the breach that gave rise to the indemnification obligation and the
time value of money shall be calculated using the prevailing prime rate of
interest as the discount rate.
(f) Notwithstanding any term or condition of this Section 6.7 to the
contrary, the liability of the FCI Directors shall be limited pursuant to this
Section 6.7 as follows: (i) the maximum liability of any individual FCI Director
for all claims pursuant to this Section 6.7 shall not exceed the value of such
FCI Director's shares in IFI received pursuant to this Agreement at the time he
is required to satisfy any liability pursuant to the provisions of this Section
6.7; and (ii) at the option of any FCI Director, he shall have the right to
satisfy any liability on his part pursuant to this Section 6.7 by the tender of
IFI Common Stock received by him pursuant to this Agreement to IFI and to
receive a credit against such liability in an amount equal to the number of
shares so tendered times the IFI closing price or bid, as may be applicable, at
the time he is required to satisfy any liability pursuant to the provisions of
this Section 6.7.
6.8 Reorganization Covenant.
Following the Merger, the Surviving Corporation will continue the
historic businesses of FCI.
6.9 Financial Covenants of IFI.
Following the Closing Date, IFI shall use its best efforts to promptly
complete the required audits and accounting with respect to IFI and its then
existing subsidiaries so as to permit IFI to prepare and file a true, correct
and complete registration statement under the Securities Act of 1933, as
amended.
VII. CONDITIONS
7.1 Conditions Precedent to the Obligations of All Parties.
Notwithstanding any other provision of this Agreement, the obligations of IFI on
the one hand, and of FCI on the other hand,
17
<PAGE> 22
to effect the Merger shall be subject to the fulfillment, as of the Closing, of
each of the following conditions (unless waived by the written consent of the
parties hereto):
(a) all permits, approvals and consents of any governmental body or
agency or other third party necessary or appropriate for consummation of the
Merger shall have been obtained;
(b) there shall not be in effect an order or decision of a court of
competent jurisdiction which prevents, or would materially alter the terms of,
the Merger;
(c) there shall not be any action or proceeding commenced by or
before any court or governmental agency or authority in the United States, or
threatened by any governmental agency or authority in the United States, that
challenges the consummation of the Merger.
7.2 Additional Conditions Precedent to the Obligations of IFI. In
addition to the conditions contained in Section 7.1, the obligations of IFI to
effect the Merger shall also be subject to the fulfillment as of the Closing
Date of each of the following conditions (unless waived in writing by IFI): The
representations and warranties of FCI contained in Article V shall be true in
all material respects at and as of the date hereof and as of the Closing Date as
if made at and as of such time; and FCI shall have duly performed and complied
in all material respects with all agreements, covenants and conditions required
by this Agreement to be performed or complied with by it prior to or on the
Closing Date.
7.3 Additional Conditions Precedent to the Obligations of FCI. In
addition to the conditions contained in Section 7.1, the obligations of FCI to
effect the Merger shall also be subject to the fulfillment at the Closing Date
of each of the following conditions (unless waived in writing by FCI):
(a) the representations and warranties of IFI contained in Article
III shall be true in all material respects at and as of the date hereof and as
of the Closing Date as if made at and as of the Closing Date; IFI shall have
duly performed and complied in all material respects with all agreements,
covenants and conditions required by this Agreement to be performed or complied
with by it prior to or at the Closing Date; and
(b) IFI shall have delivered to FCI the following documents:
(i) IFI Common Stock certificates issued in the names of the
persons and in the quantities set forth in Exhibit B hereto, representing an
aggregate of 27,980,667 shares;
(ii) A certified copy of IFI's amendment to its Articles of
Incorporation evidencing the completion of a 1 for 10 reverse stock split,
resulting in a total of 2,536,000 shares of IFI Common Stock being issued and
outstanding immediately prior to the Closing;
18
<PAGE> 23
(iii) The written resignations of IFI's officers and
directors, effective as of the Closing Date; and
(iv) A copy of IFI's shareholder list, certified by IFI's
transfer agent, dated within five days prior to the Closing.
VIII. TERMINATION
8.1 Termination by Mutual Consent. At any time prior to the Effective
Time, this Agreement and the Agreement of Merger may be terminated by written
consent of IFI and FCI, notwithstanding approval of the Merger by the
shareholders of IFI or FCI.
8.2 Termination by FCI. FCI may terminate this Agreement and the
Agreement of Merger at any time prior to the Effective Time by delivery of
written notice to IFI if:
(a) There has been a material adverse change in IFI's business,
assets, financial condition or prospects since the date of this Agreement;
(b) IFI has violated any material term or provision of this
Agreement which has not been cured by IFI within ten (10) days from the date of
receipt of notice of such violation by FCI; or
(c) Any representation or warranty made by IFI in this Agreement is
false or inaccurate in any material respect or there is any material
misrepresentation or omission by IFI.
8.3 Effect of Termination. In the event of termination as provided
above, this Agreement shall forthwith become of no further force or effect, all
parties hereto shall bear their own costs associated with this Agreement and all
transactions mentioned herein and there shall be no obligation on the part of
any party's officers, directors or shareholders; provided, however, that Section
6.4(b), Section 6.5 and Section 9.8 shall survive such termination and continue
in full force and effect.
IX. GENERAL PROVISIONS
9.1 Notices. All notices, requests, demands or other communications
required or authorized or contemplated to be given by this Agreement shall be in
writing and shall be deemed to have been duly given if hand delivered, sent by
commercial overnight courier or sent by certified or registered mail, postage
prepaid, and addressed as follows:
If to IFI: International Forest Industries, Inc.
4056 Elkridge Drive
Las Vegas, NV 89129
Attention: President
19
<PAGE> 24
With a copy to: Aaron A. Grunfeld, Esq.
Resch, Polster, Alpert & Berger LLP
10390 Santa Monica Boulevard,
Fourth Floor
Los Angeles, CA 90025
If to FCI: Flour City International, Inc.
915 Riverview Drive
Johnson City, TN 37601
Attention: President
With a copy to: William Lopshire, Esq.
Manning, Marder & Wolfe
707 Wilshire Boulevard
45th Floor
Los Angeles, California 90017
If to Andrew W. Berney: At the address for IFI
set forth hereinabove
If to Bruce Barton: At the address for IFI
set forth hereinabove
If to John M. Eckert: At the address for IFI
set forth hereinabove
If to John Tang: At the address for FCI
set forth hereinabove
If to Michael Russo: At the address for FCI
set forth hereinabove
or such other address as the parties hereto may from time to time designate in
writing, prior to the giving of such notice. Any such notice, if hand delivered,
shall be effective upon the date of delivery, and if given by commercial
overnight courier or by certified or registered mail, shall be effective two
business days following the date of sending such notice. A facsimile
transmission, when received, shall be considered delivery of written notice.
9.2 Amendment and Waiver. No amendment or waiver of any provision of
this Agreement shall in any event be effective, unless the same shall be in
writing signed by each of the parties hereto, and then such amendment, waiver or
consent shall be effective only in a specific instance and for the specific
purpose for which given.
9.3 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same Agreement.
20
<PAGE> 25
9.4 Assignability. This Agreement shall not be assigned by any party
without the prior written consent of all of the parties hereto, which consent
may be withheld by any such party in its sole and absolute discretion. In the
event of such permitted assignment, this Agreement shall bind and inure to the
benefit of the parties named herein and their respective successors and assigns.
9.5 Entire Agreement. This Agreement and the documents referred to
herein, including without limitation, the Employment Agreement, the Registration
Rights Agreement and the Agreement of Merger, contain the entire understanding
among the parties with respect to the transactions contemplated hereby and
supersede all prior and contemporaneous agreements and understandings whether
oral or written, relating to the subject matter hereof.
9.6 Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Nevada and the parties hereby consent
to the jurisdiction of the Nevada courts for all matters relating to this
Agreement.
9.7 Headings. The section and other headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of the terms and conditions contained therein or of this
Agreement.
9.8 Attorneys' Fees. In the event of any dispute which results in a suit
or other legal proceeding to construe or enforce any provision of this Agreement
or because of any alleged breach, default or misrepresentation in connection
with any of the provisions of this Agreement, the parties agree that the
prevailing party or parties (in addition to all other amounts and relief to
which sued party or parties may be entitled) shall be entitled to recover
reasonable attorneys' fees and other costs and expenses incurred in any action
or proceeding.
9.9. Further Assurances. At the request of any of the parties hereto,
and without further consideration, the other parties agree to execute and
deliver to the other parties such documents and instruments and to do such
further acts as may be necessary or desirable to effectuate the Merger as
contemplated by this Agreement.
(SIGNATURES ON FOLLOWING PAGE)
21
<PAGE> 26
IN WITNESS WHEREOF, the parties hereto have signed this Agreement or
have caused this Agreement to be signed by their respective duly authorized
officers as of the date first above written.
INTERNATIONAL FOREST INDUSTRIES, INC.
By: ______________________________
Name: ______________________________
Title: ______________________________
FLOUR CITY INTERNATIONAL, INC.
By: ______________________________
Name: ______________________________
Title: ______________________________
FOR PURPOSES OF THE INDEMNIFICATION PROVISIONS OF SECTION 6.7 OF THIS AGREEMENT
THE FOLLOWING INDIVIDUALS HAVE EXECUTED THIS AGREEMENT THEREBY ACCEPTING THE
TERMS AND CONDITIONS OF SECTION 6.7 AND AGREEING TO BE BOUND THEREBY:
Agreed to and Accepted by:
________________________________
Andrew W. Berney, an individual
________________________________
Bruce Barton, an individual
________________________________
John M. Eckert, an individual
________________________________
John W. Y. Tang, an individual
________________________________
Michael Russo, an individual
22
<PAGE> 27
EXHIBIT B
ISSUANCE OF IFI COMMON STOCK TO FCI SHAREHOLDERS
<TABLE>
<CAPTION>
Number of IFI Common Shares
Name of Shareholder to be delivered at the Closing
------------------- ------------------------------
<S> <C>
John Tang 5,036,520
Michael Russo 1,399,033
Bryan Willis 1,119,227
Roger Ulbricht 279,807
Gold Manor Limited 3,357,680
Dynamic Choice Enterprises Inc. 3,357,680
Wilson International Limited 13,430,720
-----------
Total 27,980,667
===========
</TABLE>
<PAGE> 1
EXHIBIT 10.4
FLOUR CITY INTERNATIONAL, INC.
1997 STOCK INCENTIVE PLAN
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
Page
<S> <C>
1. THE PLAN ......................................................................1
1.1 Purpose......................................................................1
1.2 Administration ..............................................................1
1.3 Participation................................................................2
1.4 Shares Subject to the Plan ..................................................2
1.5 Grant of Awards..............................................................3
1.6 Exercise of Awards...........................................................3
1.7 Payment Forms................................................................3
1.8 Cashless Exercises ..........................................................3
1.9 Award Period ................................................................4
1.10 No Transferability; Limited Exception to ....................................4
Transfer Restrictions
2. OPTIONS ......................................................................4
2.1 Grants ......................................................................4
2.2 Option Price ................................................................5
2.3 Option Period................................................................5
2.4 Exercise of Options..........................................................5
2.5 Limitations on Grant of ISOs.................................................5
2.6 Limits on 10% Holders........................................................5
2.7 Option Repricing/Cancellation ...............................................5
and Regrant/Waiver of Restrictions
2.8 Options and Rights in Substitution for Stock ................................6
Options Granted by Other Corporations
3. STOCK APPRECIATION RIGHTS ..........................................................6
3.1 Grants ......................................................................6
3.2 Exercise of Stock Appreciation Rights........................................6
3.3 Payment......................................................................7
3.4 Limited Stock Appreciation Rights............................................7
4. RESTRICTED STOCK AWARDS ............................................................7
4.1 Grants ......................................................................7
4.2 Restrictions & Rights........................................................8
4.3 Return to the Corporation....................................................8
5. STOCK BONUSES, OTHER CASH OR STOCK PERFORMANCE-BASED
AWARDS, DEFERRED PAYMENTS AND DIVIDEND EQUIVALENT RIGHTS .........................8
5.1 Grants of Stock Bonuses......................................................8
5.2 Other Performance-Based Awards ..............................................8
5.3 Deferred Payments............................................................9
5.4 Dividend Equivalent Rights .................................................10
6. STOCK UNITS........................................................................10
6.1 Grants .....................................................................10
6.2 Other Provisions ...........................................................10
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
7. NON-EMPLOYEE DIRECTOR OPTIONS......................................................10
7.1 Participation...............................................................10
7.2 Option Grants...............................................................10
7.3 Option Price ...............................................................11
7.4 Option Period and Exercisability ...........................................11
7.5 Termination of Directorship.................................................11
7.6 Adjustments; Acceleration; Termination .....................................11
8. OTHER PROVISIONS...................................................................12
8.1 Rights of Eligible Persons, Participants and Beneficiaries..................12
8.2 Adjustments; Acceleration; Possible Early Termination of Awards.............12
8.3 Termination of Employment...................................................14
8.4 Compliance With Laws .......................................................15
8.5 Tax Withholding.............................................................15
8.6 Amendment, Termination and Suspension.......................................16
8.7 Privileges of Stock Ownership...............................................16
8.8 Effective Date of the Plan .................................................16
8.9 Term of the Plan ...........................................................16
8.10 Governing Law/Construction/Severability.....................................17
8.11 Captions....................................................................17
8.12 Non-Exclusivity of Plan.....................................................17
9. DEFINITIONS .......................................................................17
9.1 Definitions.................................................................17
</TABLE>
<PAGE> 4
FLOUR CITY INTERNATIONAL, INC.
1997 STOCK INCENTIVE PLAN
1. THE PLAN.
1.1 PURPOSE. The purpose of this Flour City International, Inc. 1997
Stock Incentive Plan (the "Plan") is to promote the success of the Company by
providing equity incentives to attract, motivate and retain key personnel and to
attract, motivate and retain experienced and knowledgeable non-employee
directors. Capitalized terms are defined in Article 9.
1.2 ADMINISTRATION.
1.2.1 COMMITTEE. This Plan shall be administered by and all
awards to Eligible Persons shall be authorized by the Committee, acting by a
majority vote or by written consent of its members. The Committee may delegate
ministerial, non-discretionary functions to third parties, including officers or
employees of the Company.
1.2.2 POWERS OF COMMITTEE. Subject to the express provisions of
this Plan, the Committee shall have the authority:
(a) to determine from among those persons eligible the
particular Eligible Persons who will receive Awards;
(b) to grant Awards to Eligible Persons, determine the
price at which securities will be offered or awarded and the amount of
securities to be offered or awarded to any of such persons, and determine the
other specific terms and conditions of such Awards consistent with the express
limits of this Plan, and establish the installments (if any) in which such
Awards shall become exercisable or shall vest, or determine that no delayed
exercisability or vesting is required, and establish the events of termination
or reversion of such Awards;
(c) to approve the forms of Award Agreements (which need
not be identical either as to type of award or among Participants);
(d) to construe and interpret this Plan and any agreements
defining the rights and obligations of the Corporation and Participants under
this Plan, further define the terms used in this Plan, and prescribe, amend and
rescind rules and regulations relating to the administration of this Plan;
(e) to cancel, modify, or waive the Corporation's rights
with respect to, or modify, discontinue, suspend, or terminate any or all
outstanding Awards held by Eligible Persons, subject to any required consent
under Section 8.6;
(f) to accelerate or extend the exercisability or extend
the term of any or all such outstanding Awards within the maximum term of Awards
under Section 1.9;
(g) to determine the effect, in any, on a Participant's
rights during or following a leave of absence; and
<PAGE> 5
(h) to make all other determinations and take such other
action as contemplated by this Plan or as may be necessary or advisable for the
administration of this Plan and the effectuation of its purposes.
Notwithstanding the foregoing, the provisions of Article 7 relating to
Non-Employee Director Awards shall be automatic (except as provided therein)
and, to the maximum extent possible, self-effectuating.
1.2.3 BINDING DETERMINATIONS; RELIANCE. Any action taken by, or
inaction of, the Corporation, the Board or the Committee relating to or pursuant
to this Plan shall be within the absolute discretion of that entity or body and
shall be conclusive and binding upon all persons. No member of the Board or
Committee, or officer of the Corporation or any Subsidiary, shall be liable for
any such action or inaction. In making any determination or not taking any
action under this Plan, the Committee or the Board, as the case may be, may
obtain and may rely upon the advice of counsel, accountants and other experts or
professional advisors to the Company and such determination shall be conclusive.
1.2.4 COMMITTEE MEMBERSHIP. Subject to the requirements of the
definition of Committee contained in Article 9, the Board may, at any time (a)
change the number of members of the Committee, (b) remove from membership on the
Committee all or any of its members, (c) fill any vacancy existing on the
Committee, whether caused by removal, resignation or otherwise, or (d) change or
assume the administration of this Plan.
1.2.5 AWARDS TO COMMITTEE MEMBERS. Any Award issued to a member
of the Committee (other than under Article 7) shall be subject to approval or
ratification by the Board.
1.3 PARTICIPATION. Awards other than under Article 7 may be granted by
the Committee only to those persons that the Committee determines to be Eligible
Persons. An Eligible Person who has been granted an Award may, if otherwise
eligible, be granted additional Awards.
1.4 SHARES SUBJECT TO THE PLAN.
1.4.1 SHARES. Subject to the provisions of Section 8.2, the
capital stock that may be delivered under this Plan shall be shares of the
Corporation's authorized but unissued Common Stock and any shares of its Common
Stock held as treasury shares. The Shares may be delivered for any lawful
consideration.
(a) AGGREGATE LIMIT. The maximum number of Shares that may
be delivered pursuant to Awards granted to Eligible Persons under this Plan
shall not exceed 3,500,000 plus 10% of any increase in outstanding Shares that
occurs after December 15, 1997 (including any increase as a result of the
issuance of Shares under this Plan). The limit in the foregoing sentence shall
not contract if Shares are reacquired by the Corporation after an increase has
been made, but neither shall the limit increase if such reacquired Shares are
reissued.
(b) ISO LIMIT. The maximum number of Shares that may be
delivered pursuant to ISOs granted to Eligible Persons under this Plan shall not
exceed 3,500,000 Shares.
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(c) INDIVIDUAL LIMIT. The maximum number of Shares subject
to those Options, Stock Appreciation Rights and other Awards payable in Shares
or alternatively in Shares or cash that are granted during any calendar year to
any one individual shall be limited to 700,000.
(d) ADJUSTMENT. Each of the foregoing specific Share
limits in this Section 1.4.1 shall be subject to adjustment as contemplated by
Section 1.4.2 and Section 8.2.
1.4.2 CALCULATION OF AVAILABLE SHARES AND REPLENISHMENT. If any
Option, Stock Appreciation Right, or other right to acquire Shares under or
receive cash or Shares in respect of an Award lapses or terminates without
having been exercised in full, or any Shares subject to a Restricted Stock Award
or other Award do not vest or are not delivered, the unpurchased, unvested or
undelivered Shares will again be available for purposes of this Plan. The
foregoing sentence does not apply to any Shares withheld under Section 8.5.
1.5 GRANT OF AWARDS. Subject to the express provisions of this Plan, the
Committee shall determine the Eligible Persons to whom Awards will be granted,
the number of Shares subject to each Award, the price (if any) to be paid for
the Shares or the Award and, in addition to matters addressed in Section 1.2.2,
the specific objectives, goals and performance criteria that further define the
terms of any performance-based award. Each Award shall be evidenced by an Award
Agreement signed by the Corporation and, if required by the Committee, by the
Participant. The Award Agreement shall set forth or may incorporate by reference
the material terms and conditions of the Award established by the Committee
consistent with the specific provisions of this Plan. Unless a later date is
specified by the Committee in the applicable Award Agreement, the grant of an
Award is made on the Award Date.
1.6 EXERCISE OF AWARDS. An exercisable Award will be deemed to be
exercised when the Secretary of the Corporation receives an executed Exercise
Agreement from the Participant, together with payment of any required Purchase
Price in accordance with Section 1.7, 1.8, or 7.3, as the case may be. Awards of
Shares are exercisable only for and payable only in whole shares. Fractional
shares will be disregarded for all purposes under this Plan.
1.7 PAYMENT FORMS. The Purchase Price of each Award (if any) must be
paid in full at the time of each purchase in one or a combination of the
following methods, to the extent authorized by the Committee or set forth in the
Award Agreement: (a) cash or cashier's check payable to the Corporation, (b) if
the Committee approves, a Note, or (c) by Shares already owned by the
Participant, subject to any conditions (including holding periods) that the
Committee may impose. Any Shares delivered that were initially acquired upon
exercise of an Award must have been owned by the Participant at least six months
as of the date of delivery. Shares used to satisfy the Purchase Price or (if
authorized by the Committee) applicable tax withholding will be valued at their
Fair Market Value on the exercise or purchase date.
1.8 CASHLESS EXERCISES. Award Agreements may also provide that an Option
or similar right may be exercised and payment can be made by delivering a
properly executed exercise notice to the Corporation, together with irrevocable
instructions to a bank or broker to promptly deliver to the Corporation the
amount of sale proceeds necessary to pay the Purchase Price and, unless
otherwise provided by the Committee, any applicable tax withholding under
Section 8.5. The date of exercise will be deemed to be the date the Corporation
receives the proceeds.
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1.9 AWARD PERIOD. Any Option, Stock Appreciation Right, or similar right
shall expire and other Awards shall either vest or be forfeited not more than 10
years after the date of grant; provided, however, that any right to payment of
cash or delivery of stock that has vested pursuant to an Award may be delayed
until a future date if specifically authorized by the Committee in writing.
1.10 NO TRANSFERABILITY; LIMITED EXCEPTION TO TRANSFER RESTRICTIONS.
1.10.1 LIMIT ON EXERCISE AND TRANSFER. Unless otherwise expressly
provided in (or pursuant to) this Section 1.10, by applicable law and by the
Award Agreement, as the same may be amended, (i) all Awards are non-transferable
and shall not be subject in any manner to sale, transfer, anticipation,
alienation, assignment, pledge, encumbrance or charge; Awards shall be exercised
only by the Participant; and (ii) amounts payable or shares issuable pursuant to
an Award shall be delivered only to (or for the account of) the Participant.
1.10.2 EXCEPTIONS. The Committee may permit Awards to be
exercised by and paid to certain persons or entities related to the Participant,
including but not limited to members of the Participant's family, charitable
institutions, or trusts or other entities whose beneficiaries or beneficial
owners are members of the Participant's immediate family and/or charitable
institutions, or to such other persons or entities as may be approved by the
Committee, pursuant to such conditions and procedures as the Committee may
establish. Any permitted transfer shall be subject to the condition that the
Committee receive evidence satisfactory to it that the transfer is being made
for estate and/or tax planning purposes on a gratuitous or donative basis and
without consideration (other than nominal consideration). Notwithstanding the
foregoing, ISOs and Restricted Stock Awards shall be subject to any and all
additional transfer restrictions under the Code.
1.10.3 FURTHER EXCEPTIONS TO LIMITS ON TRANSFER. The exercise and
transfer restrictions in Section 1.10.1 shall not apply to:
(a) transfers to the Corporation,
(b) the designation of a beneficiary to receive benefits
in the event of the Participant's death or, if the Participant has died,
transfers to or exercise by the Participant's beneficiary, or, in the absence of
a validly designated beneficiary, transfers by will or the laws of descent and
distribution,
(c) transfers pursuant to a QDRO order if approved or
ratified by the Committee,
(d) if the Participant has suffered a disability,
permitted transfers or exercises on behalf of the Participant by his or her
legal representative, or
(e) the authorization by the Committee of "cashless
exercise" procedures with third parties who provide financing for the purpose of
(or who otherwise facilitate) the exercise of Awards consistent with applicable
laws and the express authorization of the Committee.
2. OPTIONS.
2.1 GRANTS. One or more Options may be granted under this Section 2 to
any Eligible Person. Each Option granted shall be designated by the Committee as
either a NQSO or an ISO, and such intent will
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be indicated in the Award Agreement. ISOs may be granted only to Eligible
Persons who are employed by the Corporation or a corporation that is a "parent"
or "subsidiary" corporation within the meaning of Sections 424(e) and 424(f) of
the Code, respectively.
2.2 OPTION PRICE. The Purchase Price per Share covered by each Option
shall be determined by the Committee at the time of the Award. In the case of
ISOs the Purchase Price per Share must be at least 100% (110% in the case of
persons described in Section 2.6) of the Fair Market Value of the Shares on the
Award Date and in all cases shall not be less than the minimum consideration
required under applicable law.
2.3 OPTION PERIOD. Subject to Section 1.9, each Option will expire on a
date determined by the Committee, but not later than 10 years after the Award
Date, and will be subject to earlier termination as set forth in this Plan or
the Award Agreement.
2.4 EXERCISE OF OPTIONS. An Option may become exercisable, in whole or
in part, on the date or dates specified in the Award Agreement and thereafter
will remain exercisable until the earlier of the expiration or termination of
the Option, or as otherwise set forth in this Plan or the related Award
Agreement. At least 100 Shares must be purchased at one time unless the number
purchased is the total number at the time available for purchase under the
Option.
2.5 LIMITATIONS ON GRANT OF ISOs.
2.5.1 $100,000 LIMIT. To the extent that the aggregate "Fair
Market Value" of stock with respect to which incentive stock options first
become exercisable by a Participant in any calendar year exceeds $100,000,
taking into account both Common Stock subject to ISOs under this Plan and stock
subject to incentive stock options under all other plans of the Company, such
options shall be treated as NQSOs. For this purpose, the "Fair Market Value" of
the stock subject to options shall be determined as of the date the options were
awarded. In reducing the number of options treated as incentive stock options to
meet the $100,000 limit, the most recently granted options shall be reduced
first. To the extent a reduction of simultaneously granted options is necessary
to meet the $100,000 limit, the Committee may, in the manner and to the extent
permitted by law, designate which Shares are to be treated as shares acquired
pursuant to the exercise of an ISO.
2.5.2 OTHER CODE LIMITS. ISOs may only be granted to employees of
the Corporation or a Subsidiary that satisfies the other eligibility
requirements of the Code and shall include such other terms and conditions as
from time to time are required in order that the Option be an "incentive stock
option" as defined in Section 422 of the Code.
2.6 LIMITS ON 10% HOLDERS. No ISO may be granted to any person who, at
the time the Option is granted, owns (or is deemed to own under Section 424(d)
of the Code) Shares possessing more than 10% of the total combined voting power
of all classes of stock of the Corporation, unless the Purchase Price of such
Option is at least 110% of the Fair Market Value of the stock subject to the
Option and such Option by its terms is not exercisable after the expiration of
five years from the date such Option is granted.
2.7 OPTION REPRICING/CANCELLATION AND REGRANT WAIVER OF
RESTRICTIONS. Subject to Section 1.4 and Section 8.6 and the specific
limitations on Awards contained in this Plan, the Committee from time to time
may authorize, generally or in specific cases only, for the benefit of any
Eligible Person any adjustment in the exercise or purchase price, the vesting
schedule, the
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number of shares subject to, the restrictions upon or the term of, an Award
granted under this Article 2 by cancellation of an outstanding Award and a
subsequent regranting of an Award, by amendment, by substitution of an
outstanding Award, by waiver or by other legally valid means. Such amendment or
other action may result among other changes in an exercise or purchase price
which is higher or lower than the exercise or purchase price of the original or
prior Award, provide for a greater or lesser number of shares subject to the
Award, or provide for a longer or shorter vesting or exercise period.
2.8 OPTIONS AND RIGHTS IN SUBSTITUTION FOR STOCK OPTIONS GRANTED BY
OTHER CORPORATIONS. Options and Stock Appreciation Rights may be granted to
Eligible Persons under this Plan in substitution for employee stock options
granted by other entities to persons who are or who will become Eligible Persons
in respect of the Company, in connection with a distribution, merger or
reorganization by or with the granting entity or an affiliated entity, or the
acquisition by the Company, directly or indirectly, of all or a substantial part
of the stock or assets of the other entity.
3. STOCK APPRECIATION RIGHTS.
3.1 GRANTS. In its discretion, the Committee may grant Stock
Appreciation Rights to any Eligible Person either concurrently with the grant of
another Award or in respect of an outstanding Award, in whole or in part, or
independently of any other Award. A Stock Appreciation Right granted
concurrently with the grant of another Award may extend to all or a portion of
the Shares covered by the related Award. A Stock Appreciation Right will entitle
the Participant to holds the related Award, upon exercise of the Stock
Appreciation Right and surrender of the related Award, or portion thereof, to
receive payment of an amount determined pursuant to Section 3.3. Any Stock
Appreciation Right granted in connection with an ISO shall contain such terms as
may be required to comply with the provisions of Section 422 of the Code and the
regulations promulgated thereunder, unless the holder otherwise agrees.
3.2 EXERCISE OF STOCK APPRECIATION RIGHTS.
3.2.1 EXERCISABILITY. Unless the Award Agreement or the Committee
provides otherwise, a Stock Appreciation Right related to another Award shall be
exercisable only at such time or times, and to the extent, that the related
Award is exercisable.
3.2.2 EFFECT ON AVAILABLE SHARES. Unless the Committee otherwise
provides, to the extent that a Stock Appreciation Right is exercised, the number
of Shares theretofore subject to a related Award shall be charged against the
maximum number of Shares that may be issued pursuant to Awards. The number of
Shares subject to the Stock Appreciation Right and the related Award will also
be reduced by such number of shares. If a Stock Appreciation Right granted
concurrently with an Award extends to fewer than all the Shares covered by the
related Award, and if a portion of the related Award is subsequently exercised,
the number of Shares subject to the unexercised Stock Appreciation Right will be
reduced only to the extent that the remaining number of Shares covered by such
related Award is less than the remaining number of Shares subject to the Stock
Appreciation Right.
3.2.3 INDEPENDENT STOCK APPRECIATION RIGHT. A Stock Appreciation
Right granted independently of any other Award shall be exercisable pursuant to
the terms of the applicable Award Agreement.
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3.3 PAYMENT.
3.3.1 AMOUNT. Unless the Committee otherwise provides, upon
exercise of a Stock Appreciation Right and the attendant surrender of an
exercisable portion of any related Award, the Participant shall be entitled to
receive payment of an amount determined by multiplying:
(a) the difference obtained by subtracting the Purchase
Price per share of Common Stock under the related Award (if applicable) or the
initial base price or share value specified in the Award from the Fair Market
Value of a share of Common Stock on the date of exercise of the Stock
Appreciation Right, by
(b) the number of Shares with respect to which the Stock
Appreciation Right shall have been exercised.
3.3.2 FORM OF PAYMENT. The Committee, in its sole discretion,
shall determine the form in which payment shall be made of the amount determined
under paragraph (a) above, either solely in cash, solely in Shares (valued at
Fair Market Value on the date of exercise of the Stock Appreciation Right), or
partly in Shares and partly in cash, on a current or deferred basis as may be
authorized by the Committee, consistent with the terms of this Plan. If the
Committee permits the Participant to elect to receive cash or Shares (or a
combination thereof) on such exercise, or to use Shares to pay any applicable
withholding taxes payable, any such election shall be subject to such conditions
as the Committee may impose.
3.4 LIMITED STOCK APPRECIATION RIGHTS. The Committee may grant to any
Eligible Person Stock Appreciation Rights exercisable only upon or in respect of
a change in control or any other specified event ("Limited SARs") and such
Limited SARs may relate to or operate in tandem or combination with or
substitution for Options, other Stock Appreciation Rights or other Awards (or
any combination thereof), and may be payable in cash or shares based on the
spread between the base price of the Stock Appreciation Right and a price based
upon the Fair Market Value of the Shares during a specified period or at a
specified time within a specified period before, after or including the date of
such event.
4. RESTRICTED STOCK AWARDS.
4.1 GRANTS. The Committee may, in its discretion, grant one or more
Restricted Stock Awards to any Eligible Person. Each Restricted Stock Award
Agreement shall specify the number of Shares to be issued to the Participant,
the date of such issuance, the consideration for such shares (but not less than
the minimum lawful consideration under applicable state law) by the Participant,
the extent (if any) to which and the time (if ever) at which the Participant
shall be entitled to dividends, voting and other rights in respect of the shares
prior to vesting, and the restrictions (which may be based on performance
criteria, passage of time or other factors or any combination thereof) imposed
on such shares and the conditions of release or lapse of such restrictions. Such
restrictions shall not lapse earlier than six months after the Award Date,
except to the extent the Committee may otherwise provide. Stock certificates
evidencing shares of Restricted Stock pending the lapse of the restrictions
("Restricted Shares") shall bear a legend making appropriate reference to the
restrictions imposed hereunder and shall be held by the Corporation or by a
third party designated by the Committee until the restrictions on such shares
shall have lapsed and the shares shall have vested in accordance with the
provisions of the Award and Section 1.9. Upon issuance of the Restricted Stock
Award, the Participant may be required to provide such further assurance and
documents as the Committee may require to enforce the restrictions.
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4.2 RESTRICTIONS AND RIGHTS.
4.2.1 PRE-VESTING RESTRAINTS. Except as provided in Sections 4.1
and 1.10, restricted shares comprising any Restricted Stock Award may not be
sold, assigned, transferred, pledged or otherwise disposed of or encumbered,
either voluntarily or involuntarily, until the restrictions on such shares have
lapsed and the shares have become vested.
4.2.2 DIVIDEND AND VOTING RIGHTS. Unless otherwise provided in
the applicable Award Agreement, a Participant receiving a Restricted Stock Award
shall be entitled to cash dividends and voting rights for all Shares issued even
though they are not vested, provided that such rights shall terminate
immediately as to any Restricted Shares that cease to be eligible for vesting.
4.2.3 CASH PAYMENTS. If the Participant shall have paid cash or
other property in respect of the Restricted Stock Award, the Award Agreement
shall specify whether and to what extent such cash or other property shall be
returned (with or without an earnings factor) as to any restricted Shares that
cease to be eligible for vesting.
4.3 RETURN TO THE CORPORATION. Unless the Committee otherwise expressly
provides, restricted shares that remain subject to restrictions at the time of
termination of employment or are subject to other conditions to vesting that
have not been satisfied by the time specified in the applicable Award Agreement
shall not vest and shall be returned to the Corporation as therein provided.
5. STOCK BONUSES, OTHER CASH OR STOCK PERFORMANCE-BASED AWARDS, DEFERRED
PAYMENTS AND DIVIDEND EQUIVALENT RIGHTS.
5.1 GRANTS OF STOCK BONUSES. The Committee may grant a Stock Bonus to
any Eligible Person to reward exceptional or special services, contributions or
achievements in the manner and on such terms and conditions (including any
restrictions on such shares) as determined from time to time by the Committee.
The number of shares so awarded shall be determined by the Committee. The Award
may be granted independently or in lieu of a cash bonus. Notwithstanding Section
1.9 and anything contained in Section 5.2 to the contrary, Awards pursuant to
this Section 5.1 for past service need not include any minimum vesting
requirement.
5.2 OTHER PERFORMANCE-BASED AWARDS.
5.2.1 GENERAL PROVISIONS. Without limiting the generality of the
foregoing, and in addition to qualifying awards granted under other provisions
of this Plan (i.e., Options or Stock Appreciation Rights granted with an
exercise price not less than Fair Market Value at the applicable date of grant
for Section 162(m) purposes to Eligible Persons who are either salaried
employees or officers ("PRESUMPTIVELY QUALIFYING AWARDS")), other cash or
stock-related performance-based awards, including "performance-based" awards
within the meaning of Section 162(m) ("PERFORMANCE-BASED AWARDS"), whether in
the form of restricted stock, performance stock, phantom stock, stock units, or
Dividend Equivalent Rights, or other rights, whether or not related to stock
values or appreciation, and whether payable in cash, Common Stock, or a
combination thereof, may be granted under this Plan. If the Award other than a
Presumptively Qualifying Award) is intended as performance-based compensation
under Section 162(m) and is not entitled to the benefits of Section 1.162-27(f)
of the regulations thereunder, the vesting or payment thereof shall be based on
the performance of the Company on a consolidated, segment,
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subsidiary, or division basis with reference to one or more of the following
business criteria (the "criterion"): funds from operations, EBITDA, stock
appreciation, total stockholder return, net earnings (before or after taxes),
cash flow, return on equity or on assets or on net investment, or cost
containment or reduction. To the extent so defined, these terms are used as
applied under generally accepted accounting principles and in the Company's
financial reporting. To qualify Awards as performance-based under Section
162(m), the applicable business criteria and specific performance goal or goals
("targets") must be established and approved by the Committee during the first
90 days of the year (or before one-quarter of the performance measurement period
has elapsed, if such period exceeds one year) and while the performance relating
to such targets remains substantially uncertain within the meaning thereof. The
applicable performance measurement period may not be less than one nor (except
as provided in Section 1.9) more than 10 years. The Committee is not, however,
limited to the grant of this type of performance-based awards.
5.2.2 MAXIMUM AWARD. Grants or awards under this Section 5.2 may
be paid in cash or Shares or any combination thereof. In no event shall grants
of stock-related Awards made in any calendar year to any Eligible Employee under
this Plan relate to more than 100,000 Shares. In no event shall grants to any
Eligible Employee under this Plan of Awards payable only in cash and not related
to stock provide for payment of more than $1,000,000.
5.2.3 COMMITTEE CERTIFICATION. Except as otherwise permitted to
qualify as performance-based compensation under Section 162(m), before any
Performance-Based Award under this Section 5.2 is paid, the Committee must
certify that the performance standard, target(s), and the other material terms
of the Performance-Based Award were in fact satisfied.
5.2.4 TERMS AND CONDITIONS OF AWARDS. The Committee will have
discretion to determine the restrictions or other limitations of the individual
Awards under this Section 5.2, including the authority to reduce Awards, to
determine payout schedules and the extent of vesting or to pay no Awards, in its
sole discretion, IF the Committee preserves such authority at the time of grant
by language to this effect in its authorizing resolutions or otherwise. The
Committee may provide that in the event a Participant terminates employment or
service for any one or more reasons during any year, the Participant shall
forfeit all rights to any Award for that year.
5.2.5 ADJUSTMENTS FOR MATERIAL CHANGES. Performance goals or
other features of an Award under this Section 5.2 may provide that they (a)
shall be adjusted to reflect a change in corporate capitalization, a corporate
transaction (such as a reorganization, combination, separation, or merger) or a
complete or partial corporate liquidation, or (b) shall be calculated either
without regard for or to reflect any change in accounting policies or practices
affecting the Company and/or the business criteria or performance goals or
targets, or (c) shall be adjusted for any other circumstances or event, or (d)
any combination of (a) through (c), but only to the extent in each case that
such adjustment or determination in respect of Performance-Based Awards would be
consistent with the requirements of Section 162(m) to qualify as
performance-based compensation.
5.3 DEFERRED PAYMENTS. The Committee may authorize for the benefit of
any Eligible Person the deferral of any payment of cash or shares that may
become due or of cash otherwise payable under this Plan, and provide for the
crediting of benefits thereon based upon such deferment, at the election or at
the request of such Participant, subject to the other terms of this Plan. Such
deferral shall be subject to such further conditions, restrictions or
requirements as the Committee may impose, subject to any then vested rights of
Participants.
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5.4 DIVIDEND EQUIVALENT RIGHTS. In its discretion, the Committee may
grant to any Eligible Person Dividend Equivalent Rights concurrently with the
grant of any Option, Restricted Stock, Stock Unit, or other stock-based Award,
on such terms as set forth by the Committee in the Award Agreement. Dividend
Equivalent Rights shall be based on all or part of the amount of dividends
declared on Shares and shall be credited as of the dividend payment dates,
during the period between the date of grant (or such later date as the Committee
may set) and the date the stock-based Award is exercised or expires (or such
earlier date as the Committee may set), as determined by the Committee. Dividend
Equivalent Rights shall be payable in cash or Shares, or (to the extent
permitted by law) may be subject to such conditions, not inconsistent with
Section 162(m) (in the case of Options or Stock Appreciation Rights, or other
Awards intended to satisfy its conditions with respect to deductibility), as may
be determined by the Committee.
6. STOCK UNITS.
6.1 GRANTS. Subject to such rules and procedures as the Committee may
establish from time to time, the Committee may, in its discretion, authorize a
Stock Unit Award or the crediting of Stock Units pursuant to the terms of this
Plan and any applicable deferred compensation plan maintained by the
Corporation, permit an Eligible Person to irrevocably elect to defer or receive
in Stock Units all or a portion of any Award hereunder, or may grant Stock Units
in lieu of, in exchange for, in respect of, or in addition to any other Award
under this Plan or any other stock option plan or deferred compensation plan of
the Corporation. The specific terms, conditions and provisions relating to each
Stock Unit grant or election, including the form of payment to be made at or
following the vesting thereof, shall be set forth in or pursuant to the
applicable deferred stock Award Agreement and the applicable deferred
compensation plan of the Company, in form substantially as approved by the
Committee.
6.2 OTHER PROVISIONS. The Committee shall determine, among other terms
of a Stock Unit grant or Award, the form of payment of Stock Units, whether in
cash, Shares, or other consideration (including any other Award) or any
combination thereof, the valuation of the Stock Units or any non-cash payment
for the purpose of the Award, and the applicable vesting and payout provisions
of the Stock Units. The Committee in the applicable Award Agreement or the
relevant deferred compensation plan of the Company may permit the Participant to
elect the form and time of payout of the vested Stock Units on such conditions
or subject to such procedures as the Committee may impose, and may permit Stock
Unit offsets or other provision for payment of any applicable taxes that may be
due on the crediting, vesting or payment in respect of the Stock Units.
7. NON-EMPLOYEE DIRECTOR OPTIONS.
7.1 PARTICIPATION. Awards under this Article 7 shall be made only to
Non-Employee Directors and shall be evidenced by Award Agreements substantially
in the form of Exhibit A hereto.
7.2 OPTION GRANTS.
7.2.1 TIME OF INITIAL AWARD. Persons who are Non-Employee
Directors in office at or immediately after a registration statement relating to
the initial underwritten public offering of the Corporation's Common Stock is
declared effective shall be granted without further action a NQSO to purchase
20,000 shares of Common Stock at an exercise price equal to the price to the
public in such offering (the "Initial Options"). Thereafter, subject to Section
7.2.3, if any person who is not, immediately prior to his or her appointment or
election, an officer or employee of the Company shall become a Non-Employee
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Director of the Corporation, there shall be granted automatically to such person
(without any action by the Board or Committee) a NQSO, the Award Date of which
shall be the date such person takes office, to purchase 20,000 shares of Common
Stock, unless the Board otherwise provides in advance of such appointment or
election.
7.2.2 SUBSEQUENT ANNUAL AWARDS AFTER 2001. Subject to Section
7.2.3 and provided that the Non-Employee Director is then continuing in office,
each Non-Employee Director shall be granted automatically (without any action by
the Committee or the Board) a NQSO to purchase 5,000 shares of Common Stock
immediately following each annual stockholders meeting during the term of this
Plan commencing with the later of (i) the year 2001 or (ii) the year in which
the fourth anniversary of the Non-Employee Director's initial election or
appointment to the Board occurs. The Award Date of each such NQSO shall be the
date of the related annual stockholders meeting.
7.2.3 MAXIMUM NUMBER OF OPTIONS/SHARES. Grants pursuant to this
Section 7.2 that would otherwise exceed the maximum number of shares under
Section 1.4.1(a) shall be prorated within such limitation.
7.3 OPTION PRICE. The purchase price per share of the Common Stock
covered by each Option granted pursuant to Section 7.2 hereof shall be 100
percent of the Fair Market Value of the Common Stock on the Award Date. The
exercise price of any Option granted under this Article 7 shall be paid in full
at the time of each purchase in cash or by check or in Shares valued at their
Fair Market Value on the date of exercise of the Option, or partly in such
Shares and partly in cash, PROVIDED THAT any Shares used in payment shall have
been owned by the Participant at least six months prior to the date of exercise
unless the Board otherwise permits. In addition, an Option granted under this
Article 7 may be exercised and payment can be made in accordance with the
cashless exercise provisions contained in Section 1.8.
7.4 OPTION PERIOD AND EXERCISABILITY. Each Option granted under this
Article 7 and all rights or obligations thereunder shall expire ten years after
the Award Date and shall be subject to earlier termination as provided below.
Each Option granted under Section 7.2 shall first become exercisable at the rate
of 25% per annum commencing on the first anniversary of the Award Date, with the
additional vesting only on each of the next three anniversaries thereof, subject
to Sections 7.5 and 7.6.
7.5 TERMINATION OF DIRECTORSHIP. If a Non-Employee Director's services
as a member of the Board terminate for any reason other than upon or because of
an Event, any portion of an Option granted pursuant to this Article 7 which is
not then exercisable shall terminate. Subject to Section 7.6, any portion of the
Option which is then exercisable may be exercised for one year after the
termination of service in the case of a termination because of death, Total
Disability, or Retirement, or for three months after the date of termination of
service in all other cases, and shall then terminate, but in no event may the
Option be exercised after the expiration of the stated ten-year term of the
Option. If a Non-Employee Director's services as a member of the Board terminate
upon or because of an Event, an Option granted pursuant to this Article 7 and
then held by such Participant may (as provided in or pursuant to Section 7.6)
immediately become and, subject to Section 7.6, remain exercisable for three
months after the date of such termination or until the expiration of the stated
term of the Option, whichever first occurs, and shall then terminate.
7.6 ADJUSTMENTS; ACCELERATION; TERMINATION. Options granted under this
Article 7 will be subject to adjustments, acceleration, and termination as
provided in Section 8.2, but only to the extent that such adjustment and any
Board or Committee action in respect thereof in the case of an Event
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is effected pursuant to the terms of a reorganization agreement approved by the
stockholders of the Corporation or is otherwise consistent with adjustments to
Options held by persons other than executive officers or directors of the
Corporation (or, if there are none, consistent in respect of the underlying
Shares, with the effect on or rights offered to stockholders generally). To the
extent that any Option granted under this Article 7 is not exercised prior to a
dissolution of the Corporation or a merger or other corporate event that the
Corporation does not survive, and no provision is (or consistent with the
provisions of this Plan can be) made for the assumption, conversion,
substitution or exchange of the Option, the Option will terminate upon the
occurrence of the event. The Participant, however, shall be entitled to the
benefits of any alternative settlement of the Option in such circumstances, as
contemplated by Section 8.2.
8. OTHER PROVISIONS.
8.1 RIGHTS OF ELIGIBLE PERSONS, PARTICIPANTS AND BENEFICIARIES.
8.1.1 NO BINDING COMMITMENT. Status as an Eligible Person shall
not be construed as a commitment that any Award will be made under this Plan to
any Eligible Person or to Eligible Persons generally.
8.1.2 NO EMPLOYMENT CONTRACT. Nothing contained in this Plan (or
any documents relating to this Plan or to any Award) shall confer upon any
Eligible Person or other Participant any right to continue in the employ or
other service of the Company or constitute any contract or agreement of
employment or other service, nor shall interfere in any way with the right of
the Company to change such person's compensation or other benefits or to
terminate the services or employment of such person, with or without cause, but
nothing in this Plan or any document related hereto shall adversely affect any
independent contractual right of such person without his or her consent thereto.
8.1.3 PLAN NOT FUNDED. Awards payable under this Plan shall be
payable in shares or from the general assets of the Corporation, and (except as
provided in Section 1.4) no special or separate reserve, fund or deposit shall
be made to assure payment of such Awards. No Participant, Beneficiary or other
person shall have any right, title or interest in any fund or in any specific
asset (including Shares, except as expressly otherwise provided) of the Company
by reason of any Award. Neither the provisions of this Plan (or of any related
documents), nor the creation or adoption of this Plan, nor any action taken
pursuant to the provisions of this Plan shall create, or be construed to create,
a trust of any kind or a fiduciary relationship between the Company and any
Participant, Beneficiary or other person. To the extent that a Participant,
Beneficiary or other person acquires a right to receive payment pursuant to any
Award hereunder, such right shall be no greater than the right of any unsecured
general creditor of the Company.
8.2 ADJUSTMENTS; ACCELERATION; POSSIBLE EARLY TERMINATION OF AWARDS.
8.2.1 ADJUSTMENTS. If the outstanding Shares are changed into or
exchanged for cash or a different number or kind of shares or securities of the
Corporation or of another issuer, or if additional Shares or new or different
securities are distributed with respect to the outstanding Shares, through a
reorganization or merger to which the Corporation is a party, or through a
combination, consolidation, spin off, recapitalization, reclassification, stock
split, stock dividend, reverse stock split, stock consolidation or other capital
change or adjustment, an appropriate adjustment will be made in the number and
kind of Shares
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or other consideration that is subject to or may be delivered under this Plan
and pursuant to outstanding Awards, the Purchase Price of outstanding Awards,
performance criteria under outstanding Awards (subject to Section 5.2 and
8.10.3) and the numerical share limits set forth in Section 1.4, 5.2.2 and
Article 7.
In any of such events, the Committee may take such action sufficiently
prior to such event if necessary or deemed appropriate to permit the
Participants to realize the benefits intended to be conveyed with respect to the
underlying shares on substantially the same terms as are available to
stockholders generally.
8.2.2 ACCELERATION OF AWARDS UPON CERTAIN EVENTS. Subject to the
exceptions noted below, (i) each Option and Stock Appreciation Right shall
become immediately exercisable, (ii) each Restricted Stock Award shall
immediately vest free of restrictions, (iii) each Award under Article 5 shall
become payable to the Participant, and (iv) the number of Shares covered by each
Stock Unit Account shall be issued to the Participant:
(a) immediately prior to the occurrence of an Event,
unless the Committee determines prior to such Event that, upon its occurrence,
there shall be no acceleration of benefits under Awards or determines that only
certain or limited benefits under Awards shall be accelerated and the extent to
which they shall be accelerated, and/or establishes a different time in respect
of such Event for such acceleration; or
(b) immediately prior to the termination by the Company of
a Participant's employment or services for any reason other than for Cause (1)
within two years after the occurrence of an Event with respect to which vesting
has not been accelerated pursuant to Section 8.2.2(a), or (2) within 90 days
prior to an Event and in express contemplation of the Event.
The Committee may override the limitations on acceleration in this
Section 8.2.2 by express provision in the Award Agreement and may accord any
Eligible Person a right to refuse any acceleration, whether pursuant to the
Award Agreement or otherwise, in such circumstances as the Committee may
approve. Any acceleration of Awards shall comply with applicable regulatory
requirements, including without limitation Section 422 of the Code. Any
discretion with respect to these events shall be limited to the extent required
by applicable accounting requirements in the case of a transaction intended to
be accounted for as a pooling of interests transaction.
8.2.3 POSSIBLE EARLY TERMINATION OF AWARDS. If any Option or
other right to acquire Common Stock under this Plan (except as provided under
Article 7 with respect to Non-Employee Director Awards) has been fully
accelerated pursuant to Section 8.2.2 but is not exercised prior to (a) a
dissolution of the Corporation, or (b) an event described in Section 8.2.1 that
the Corporation does not survive, or (c) the consummation of an event described
in Section 8.2.1 involving an Event approved by the Board, such Option or right
shall thereupon terminate, subject to any provision that has been expressly made
by the Committee or the Board (through a plan of reorganization approved by the
Board or otherwise) for the survival, substitution, assumption, exchange or
alternative settlement of the Option or right.
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8.3 TERMINATION OF EMPLOYMENT.
8.3.1 OPTIONS.
(a) Any Option, to the extent not exercised, will
terminate and become null and void upon a Participant's termination of
employment or services with the Company, except as set forth in this Section 8.3
or otherwise expressly provided in the Award Agreement. All Options shall be
subject to earlier termination under Section 2.3, and any and all rights under
an Option, to the extent not exercised or vested, will expire immediately upon a
Participant's termination of employment or services with the Company for Cause.
The Committee shall be the sole judge of Cause.
(b) Unless otherwise expressly provided in the Award
Agreement, a Participant will have the following time periods to exercise
Options to the extent they are exercisable on the date of the Participant's
termination of employment or services with the Company:
(1) If the Participant's employment or services with
the Company terminates by any reason other than death, Total Disability or
Cause, the Participant will have 90 days after the date of such termination to
exercise any Option;
(2) If the Participant's employment or services with
the Company is terminated for Cause, the Option shall lapse immediately upon
such termination.
(3) If the Participant's employment or services with
the Company terminates by reason of Total Disability, or if the Participant
suffers a Total Disability within 90 days after a termination of service
described in Section 8.3.1(b)(1), the Participant or the Participant's Personal
Representative, as the case may be, will have 180 days after the date of Total
Disability (or, if earlier, date of termination), to exercise any Option;
(4) If the Participant dies while employed by or while
performing services to the Company, or within 90 days after a termination of
service described in Section 8.3,1(b)(1) or 8.3.1(b)(3) above, the Participant's
Beneficiary may exercise, at any time within 180 days after the date of the
Participant's death (or, if earlier date of termination) any Option.
8.3.2 STOCK APPRECIATION RIGHTS. Each Stock Appreciation Right
granted concurrently with an Award will have the same termination provisions and
exercisability periods as the related Award. The termination provisions and
exercisability periods of any Stock Appreciation Right granted independent of an
Award will be established by the Committee.
8.3.3 RESTRICTED STOCK AWARDS AND AWARDS UNDER ARTICLE 5. If a
Participant's employment or services terminates for any reason, (a) Shares
subject to the Participant's Restricted Stock Award will be terminated in
accordance with the related Award Agreement to the extent such Shares have not
become vested on the date of such termination; and (b) any Award granted to the
Participant under Article 5 will be terminated in accordance with the related
Award Agreement to the extent such Award has not become vested or payable on the
date of such termination.
8.3.4 STOCK UNITS. Each Deferred Stock Alternative Exercise
Agreement or other Award Agreement in respect of Stock Units shall include the
applicable benefit distribution and termination
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provisions for the grant or Award and shall specify the form of payment and may
incorporate (to the extent applicable) any terms of this Plan, another Award
and/or any other deferred compensation plan under which it is governed.
8.3.5 ADJUSTMENTS TO EXERCISABLE PORTION. Notwithstanding the
foregoing, if a Participant's employment or services with the Company terminates
for any reason other than for Cause, the Committee may increase the portion of a
Participant's Award exercisable to the Participant, or Participant's Beneficiary
or Personal Representative, as the case may be, and extend the applicable
periods of exercise, upon such terms as the Committee determines.
8.3.6 EFFECT OF CESSATION OF SUBSIDIARY STATUS. If an entity
ceases to be a Subsidiary, such action will be deemed for purposes of this Plan
to be a termination of services or employment of each Eligible Person of that
entity who does not continue as an Eligible Person of the Corporation or another
Subsidiary.
8.4 COMPLIANCE WITH LAWS. This Plan, the granting and vesting of Awards
under this Plan and the offer, issuance and delivery of Shares and/or the
payment of money or other benefits under this Plan or under Awards granted
hereunder are subject to compliance with all applicable federal and state laws,
rules and regulations (including but not limited to state and federal securities
law and federal margin requirements) and to such approvals by any listing,
regulatory or governmental authority as may, in the judgment of the Committee,
be necessary or advisable in connection therewith. Any securities delivered
under this Plan shall be subject to such restrictions, and the person acquiring
such securities shall, if requested by the Corporation, provide such assurances
and representations to the Corporation as the Corporation may deem necessary or
desirable to assure compliance with all applicable legal requirements.
8.5 TAX WITHHOLDING.
8.5.1 CASH OR SHARES. Upon any exercise, vesting, or payment of
any Award or upon the disposition of Shares acquired pursuant to the exercise of
an ISO prior to satisfaction of the holding period requirements of Section 422
of the Code, the Corporation shall have the right at its option to (i) require
the Participant (or Personal Representative or Beneficiary, as the case may be)
to pay or provide for payment in cash or by cashier's check payable to the
Corporation of the amount of any taxes which the Company may be required to
withhold with respect to such Award event or payment or (ii) deduct from any
amount payable in cash the amount of any taxes which the Company may be required
to withhold with respect to such cash payment. In any case where a tax is
required to be withheld in connection with the delivery of Shares under this
Plan, the Committee may, in its sole discretion and at the time of the Award or
thereafter, either require the Participant or grant to the Participant the right
to elect, pursuant to such rules and subject to such conditions as the Committee
may establish, to have the Corporation reduce the number of shares to be
delivered by (or otherwise reacquire) the appropriate number of shares valued at
their then Fair Market Value, to satisfy such withholding obligation.
8.5.2 TAX LOANS. The Corporation may, in its discretion and to
the extent permitted by law, authorize a loan to an Eligible Person in the
amount of any taxes which the Company may be required to withhold with respect
to Shares received (or disposed of, as the case may be) pursuant to a
transaction described in Section 8.5.1. Such a loan shall be for a term, at a
rate of interest and pursuant to such other terms and conditions as the
Corporation, under applicable law, may establish and such loan need not comply
with the provisions of a "Loan" defined in Section 9.1.
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8.6 AMENDMENT, TERMINATION AND SUSPENSION.
8.6.1 AMENDMENT, TERMINATION AND SUSPENSION. The Board may, at
any time, terminate or, from time to time, amend, modify or suspend this Plan,
in whole or in part. No Awards may be granted during any suspension of this Plan
or after termination of this Plan, but the Committee shall retain jurisdiction
as to Awards then outstanding in accordance with the terms of this Plan.
8.6.2 STOCKHOLDER APPROVAL. Any amendment that would (i)
materially increase the benefits accruing to Participants under this Plan, (ii)
materially increase the aggregate number of securities that may be issued under
this Plan, or (iii) materially modify the requirements as to eligibility for
participation in this Plan, shall be subject to stockholder approval to the
extent then required by Section 422 of the Code or applicable law, or deemed
necessary or advisable by the Board.
8.6.3 AMENDMENTS TO AWARDS. Without limiting any other express
authority of the Committee under but subject to the express limits of this Plan,
the Committee by agreement or resolution may waive conditions of or limitations
on Awards to Eligible Persons that the Committee in the prior exercise of its
discretion has imposed, without the consent of a Participant, and may make other
changes to the terms and conditions of Awards that do not affect in any manner
materially adverse to the Participant, his or her rights and benefits under an
Award.
8.6.4 LIMITATIONS ON AMENDMENTS TO PLAN AND AWARDS. No amendment,
suspension or termination of this Plan or change of or affecting any outstanding
Award shall, without written consent of the Participant, affect in any manner
materially adverse to the Participant any rights or benefits of the Participant
or obligations of the Corporation under any Award granted under this Plan prior
to the effective date of such change. Changes contemplated by Section 8.2 shall
not be deemed to constitute changes or amendments for purposes of this Section
8.6.
8.7 PRIVILEGES OF STOCK OWNERSHIP. A Participant will not be entitled to
the privilege of stock ownership as to any Shares not actually issued to the
Participant. No adjustment will be made for dividends or other rights as a
stockholder for which a record date is prior to the date of issue.
8.8 EFFECTIVE DATE OF THE PLAN. This Plan was duly authorized and
adopted by the Board on December 15, 1997. Until such time as this Plan is
approved by the holders of the outstanding voting stock of the Corporation, in
accordance with applicable law, any ISO's granted shall be granted upon the
conditions that the ISO's so granted: (i) shall not be exercisable prior to such
approval and (ii) shall become null and void ab initio if such shareholder
approval is not obtained.
8.9 TERM OF THE PLAN. Except as permitted by Section 1.9, no Award shall
be granted under this Plan after December 14, 2007 (the "termination date").
Unless otherwise expressly provided in this Plan or in an applicable Award
Agreement, any Award granted prior to the termination date may extend beyond
such date, and all authority of the Committee with respect to Awards hereunder,
including the authority to amend an Award or defer payment of a vested Award,
shall continue during any suspension of this Plan and in respect of Awards
outstanding on the termination date.
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8.10 GOVERNING LAW/CONSTRUCTION/SEVERABILITY.
8.10.1 CHOICE OF LAW. This Plan, the Awards, all documents
evidencing Awards and all other related documents shall be governed by, and
construed in accordance with the laws of the state of incorporation of the
Corporation.
8.10.2 SEVERABILITY. If any provision shall be held by a court of
competent jurisdiction to be invalid and unenforceable, the remaining provisions
of this Plan shall continue in effect.
8.10.3 PLAN CONSTRUCTION.
(a) It is the intent of the Corporation that transactions
in and affecting Awards in the case of an Eligible Person or Participant who is
or may be subject to Section 16 of the Exchange Act (a "SECTION 16 PERSON")
satisfy any then applicable requirements of Rule 16b-3 so that such persons
(unless they otherwise agree) will be entitled to the benefits of Rule 16b-3 or
other exemptive rules under Section 16 of the Exchange Act in respect of those
transactions and will not be subjected to avoidable liability thereunder. If any
provision of this Plan or of any Award would otherwise frustrate or conflict
with the intent expressed above, that provision to the extent practicable shall
be interpreted so as to avoid such conflict. If the conflict remains
irreconcilable, the Committee may disregard the provision if it concludes that
to do so furthers the interest of the Corporation and is consistent with the
purposes of this Plan as to such persons in the circumstances.
(b) It is the further intent of the Company that Options
or Stock Appreciation Rights with an exercise or base price not less than Fair
Market Value on the date of grant and performance awards under Section 5.2 of
this Plan that are granted to or held by a Section 16 Person shall qualify as
performance-based compensation under Section 162(m), and this Plan shall be
interpreted consistent with such intent.
8.11 CAPTIONS. Captions and headings are given to the sections and
subsections of this Plan solely as a convenience to facilitate reference.
8.12 NON-EXCLUSIVITY OF PLAN. Nothing in this Plan shall limit or be
deemed to limit the authority of the Board or the Committee to grant awards or
authorize any other compensation, with or without reference to the Common Stock,
under any other plan or authority.
9. DEFINITIONS.
9.1 DEFINITIONS.
"AWARD" means an award of any Option (which may be designated as a NQSO
or an ISO and which may include as an incident thereto Stock Units), Stock
Appreciation Right, Stock Unit, Restricted Stock, Stock Bonus, Deferred Stock
Alternative, Performance-Based Award, Dividend Equivalent Rights, or deferred
payment right, or any combination thereof, whether alternative or cumulative,
authorized by and granted under this Plan.
"AWARD AGREEMENT" means a written agreement, approved by the Committee,
setting forth the terms of an Award.
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"AWARD DATE" means the date upon which the Committee takes the action
granting an Award or such later date as the Committee designates as the Award
Date at the time of the Award or, in the case of Awards under Article 7, the
applicable date set forth therein.
"BENEFICIARY" means the person, persons, trust, or trusts designated by
a Participant or, in the absence of a designation, entitled by will or the laws
of descent and distribution to receive the benefits specified in the Award
Agreement and under this Plan in the event of a Participant's death, and shall
mean the Participant's executor or administrator if no other Beneficiary is
designated and able to act under the circumstances.
"BOARD" means the Board of Directors of the Corporation.
"CAUSE" means a determination by the Committee that the Participant: (a)
has committed a material breach of the Participant's duties and responsibilities
(other than as a result of incapacity due to a Total Disability); or (b) has
been convicted of a felony, or entered a plea of guilty or nolo contendre with
respect to such a crime; or (c) has violated any fiduciary duty or duty of
loyalty owed to the Company; or (d) has been generally incompetent or grossly
negligent in the discharge of the Participant's duties and responsibilities; or
(e) has engaged or is engaging in immoderate use of alcoholic beverages or
narcotics or other substance abuse; or (f) has violated in any material respect
any of the Company's established employment policies in effect from time to
time.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time.
"COMMISSION" means the Securities and Exchange Commission.
"COMMITTEE" means the Compensation Committee appointed by the Board and
consisting of two or more Board members or such greater number as may be
required under applicable law. In the absence of such appointment, the Board
shall be the Committee. Each of the members of the Committee, in respect of any
decision at a time when the Eligible Person affected by the decision may be (or,
in the Committee's judgment is likely to become) subject to Section 162(m),
shall be an "outside director" within the meaning of Section 162(m) if the
subject Award is intended as a performance-based award for purposes of that
section. In acting on any transaction with or for the benefit of a Section 16
Person, each acting member of the Committee shall be a "non-employee director"
within the meaning of Rule 16b-3(b)(3) promulgated under the Exchange Act,
unless the Committee's action is approved or ratified by the Board in advance of
the effective time of the action.
"COMMON STOCK" means the Common Stock of the Corporation.
"COMPANY" means, collectively, the Corporation and its Subsidiaries or
the Corporation or any Subsidiary, as the context requires.
"CORPORATION" means Flour City International, Inc., a Nevada
corporation, and its successors.
"DEFERRED STOCK ALTERNATIVE" mean a deferred payment alternative payable
in Shares or cash or other consideration, as determined by the Committee, based
on the number of Stock Units credited to a Participant's Stock Unit Account.
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"DIVIDEND EQUIVALENT RIGHT" means a right authorized under Section 5.4
of this Plan.
"ELIGIBLE PERSON" means (subject to applicable limits under the Code in
the case of ISOs) (a) an officer, director, or key employee of the Company, or
(b) any Non-Employee Director or any individual consultant or advisor who
renders or has rendered BONA FIDE services (other than services in connection
with the offering or sale of securities of the Company in a capital raising
transaction) to the Company, and who is selected to participate in this Plan by
the Committee. A non-employee agent providing BONA FIDE services to the Company
(other than as an eligible advisor or consultant) may also be selected by the
Committee as an Eligible Person if such agent's participation in this Plan would
not adversely affect (x) the Corporation's eligibility to use Form S-8 to
register under the Securities Act the offer and sale of shares issuable under
this Plan by the Corporation or (y) the Corporation's compliance with any other
applicable laws.
"EVENT" means any of the following:
(a) the dissolution or liquidation of the Corporation;
(b) approval by the stockholders of the Corporation of an
agreement to merge or consolidate, or otherwise reorganize, with or into one or
more entities that are not Subsidiaries, as a result of which 50% or more of the
outstanding voting securities of either the surviving or resulting entity or its
parent, as the case may be, immediately after the reorganization are not and
will not be, owned, directly or indirectly, by stockholders of the Corporation
immediately before such reorganization (assuming for purposes of such
determination that there is no change in the record ownership of the
Corporation's securities from the record date for such approval until such
reorganization and that such record owners hold no securities of the other
parties to such reorganization);
(c) approval by the stockholders of the Corporation of the sale
of substantially all of the Corporation's business and/or assets as an entirety
to a person or entity that is not a Subsidiary;
(d) any "person" (as such term is used in Sections 13(d) and
14(d) of the Exchange Act but excluding (1) any person described in and
satisfying the conditions of Rule 13d-1(b)(1) thereunder, and (2) any person or
entity (including any successor) that is a beneficial owner (as defined in Rule
13d-3 under the Exchange Act) of more than 20% of the Corporation as of August
31, 1997), becomes the beneficial owner, directly or indirectly, of securities
of the Corporation representing more than 50% of the combined voting power of
the Corporation's then outstanding securities entitled to then vote generally in
the election of directors of the Corporation; or
(e) during any period not longer than two consecutive years,
individuals who at the beginning of such period constituted the Board and
(without duplication in the case of successors) persons whose election or
nomination for election by the Corporation's stockholders was approved by a vote
of at least three-fourths of the Board members then still in office cease to
constitute as least a majority of the Board.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended
from time to time.
"EXERCISE AGREEMENT" means a written agreement, approved by the
Committee, setting forth the terms for the exercise of an Award.
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"FAIR MARKET VALUE" on any date shall mean:
(a) if the Shares are publicly traded: (1) if the Shares are
listed or admitted to trade on a national securities exchange, the closing price
of the Shares on the Composite Tape, as published in the Western Edition of The
Wall Street Journal, of the principal national securities exchange on which the
Shares are so listed or admitted to trade, on such date, or, if there is no
trading of the Shares on such date, then the closing price of the Shares as
quoted on such Composite Tape on the next preceding date on which there was
trading in such Shares; (2) if the Shares are not listed or admitted to trade on
a national securities exchange, the last price for the Shares on such date, as
furnished by the National Association of Securities Dealers, Inc. ("NASD")
through the NASDAQ National Market Reporting System or a similar organization if
the NASD is no longer reporting such information; (3) if the Shares are not
listed or admitted to trade on a national securities exchange and are not
reported on the National Market Reporting System, the mean between the bid and
asked price for the Shares on such date, as furnished by the NASD or a similar
organization; or
(b) if the Shares are NOT publicly traded or the NASD or a
similar organization does not furnish the mean between the bid and asked prices
for the Shares on such date, the fair market value of a Share as determined by
the Committee in good faith. Any determination as to fair market value made
pursuant to this Plan shall be determined without regard to any restriction
other than a restriction which, by its terms, will never lapse, and shall be
conclusive and binding on all persons.
"ISO" means an Option which is intended, as evidenced by its
designation, as an incentive stock option within the meaning of Section 422 of
the Code, the award of which contains such provisions and is made under such
circumstances and to such persons as may be necessary to comply with that
section.
"NQSO" means an Option that is designated as a nonqualified stock option
and shall include any Option intended to be an ISO that fails to meet the
applicable legal requirements thereof. Any Option granted hereunder that is not
designated as an incentive stock option shall be deemed to be designated a
nonqualified stock option under this Plan and not an incentive stock option
under the Code.
"NON-EMPLOYEE DIRECTOR" means a member of the Board of Directors of the
Corporation who is not an officer or employee of the Company.
"NON-EMPLOYEE DIRECTOR PARTICIPANT" means a Non-Employee Director who
holds an outstanding Award under the provisions of Article 7.
"NOTE" means a promissory note approved by the Committee evidencing a
loan from the Corporation to the Eligible Person of an amount equal to the
Purchase Price of an Award. Any Note shall be subject to the following terms:
(a) The principal of the Note shall not exceed the amount
required to be paid to the Corporation upon the exercise or receipt of such
Award, and the note shall be delivered directly to the Corporation in
consideration of such exercise or receipt.
(b) The term of the Note, including extensions, shall not exceed
ten (10) years.
(c) The note shall provide for full recourse to the Participant.
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(d) The Note shall bear interest at a rate determined by the
Committee, but not less than the interest rate necessary to avoid the imputation
of interest under the Code.
(e) The unpaid balance of the Note shall become due and payable
on the tenth day after the termination of employment or service of a
Participant; provided, however, that if a sale of such shares would cause such
Participant to incur liability under Section 16(b) of the Exchange Act, the
unpaid balance shall become due and payable on the 10th business day after the
first day on which a sale of such shares could have been made without incurring
such liability assuming for these purposes that there are no other transactions
(or deemed transactions in securities of this Corporation) by the Participant
subsequent to such termination.
(f) If required by the Committee or by applicable law, the Note
shall be secured by a pledge of any Shares or Awards financed thereby (and other
collateral if required by the Committee).
(g) The terms, repayment provisions, and collateral release
provisions of the note and the pledge securing the note shall conform with
applicable rules and regulations of the Commission and the Federal Reserve
Board, as then in effect.
"OPTION" means an option to purchase Shares granted under this Plan. The
Committee shall designate any Option granted to any Eligible Person as a NQSO or
an ISO.
"PARTICIPANT" means an Eligible Person who has been granted an Award
under this Plan and a Non-Employee Director Participant who has been granted an
Award under Article 7 of this Plan.
"PERSONAL REPRESENTATIVE" means the person or persons who, upon the
disability or incompetence of a Participant, shall have acquired on behalf of
the Participant, by legal proceeding or otherwise, the power to exercise the
rights or receive the benefits under this Plan and who shall have become the
legal representative of the Participant.
"PURCHASE PRICE" means the exercise or purchase price, if any, payable
by the Participant to the Corporation upon exercise of an Award in accordance
with the applicable Award Agreement, Exercise Agreement, and the terms of this
Plan; provided, however, that such exercise price shall not be less than the
minimum lawful consideration required under applicable state law.
"RESTRICTED STOCK" means Shares awarded to a Participant under this
Plan, subject to payment of such consideration, if any, and such conditions on
vesting (which may include, among others, the passage of time, specified
performance objectives or other factors) and such transfer and other
restrictions as are established in or pursuant to this Plan and the related
Award Agreement, for so long as such Shares remain unvested under the terms of
the applicable Award Agreement.
"RESTRICTED STOCK AWARD" means an Award of Restricted Stock made
pursuant to Article 4.
"RETIREMENT" means retirement from employment by, or providing services
to, the Corporation or any Subsidiary which occurs, in the case of employees, at
or after the Company's normal retirement age and in accordance with the
retirement policies of the Company then in effect or, in the case of a Non-
21
<PAGE> 25
Employee Director, a retirement or resignation as a director after age 65 or
after at least 15 years of service as a director.
"RULE 16b-3" means Rule 16b-3 as promulgated by the Commission pursuant
to the Exchange Act, as amended from time to time.
"SECTION 16 PERSON" means a person subject to Section 16(a) of the
Exchange Act.
"SECTION 162(m)" means Section 162(m) of the Code.
"SECURITIES ACT" means the Securities Act of 1933, as amended form time
to time.
"SHARES" means shares of the Corporation's Common Stock.
"STOCK APPRECIATION RIGHT" means a right authorized under this Plan to
receive a number of Shares or an amount of cash, or a combination of Shares and
cash, the aggregate amount of or value of which is determined by reference to a
change in the Fair Market Value of the Common Stock.
"STOCK BONUS" means an Award of Shares granted under this Plan for no
consideration other than past services and without restriction other than such
transfer or other restrictions as the Committee may deem advisable to assure
compliance with law.
"STOCK UNIT" means a non-voting unit of measurement which is deemed for
bookkeeping purposes to be equivalent to one outstanding share of the
Corporation's Common Stock (subject to adjustment) solely for purposes of this
Plan.
"STOCK UNIT ACCOUNT" means the bookkeeping account maintained by the
Corporation on behalf of each Participant who is credited with Stock Units in
accordance with Article 6, which account may be payable in cash, Shares and/or
other consideration, as the Committee may determine.
"SUBSIDIARY" means any corporation or other entity a majority or more of
whose outstanding voting stock or voting power is beneficially owned directly or
indirectly by the Corporation.
"TOTAL DISABILITY" means a "permanent and total disability" within the
meaning of Section 22(e)(3) of the Code and such other disabilities,
infirmities, afflictions, or conditions as the Committee by rule may include.
22
<PAGE> 26
EXHIBIT A
FLOUR CITY INTERNATIONAL, INC.
ELIGIBLE DIRECTOR
NONQUALIFIED STOCK OPTION AGREEMENT
THIS AGREEMENT dated as of the _____ day of _____________, ____, between
Flour City International, Inc. a Nevada corporation (the "Corporation"), and
________________ (the "Director").
W I T N E S S E T H
WHEREAS, the Corporation has adopted and the stockholders of the
Corporation have approved the Flour City International, Inc. 1997 Stock
Incentive Plan, as amended (the "Plan").
WHEREAS, pursuant to Article 7 of the Plan, the Corporation has granted
an option (the "Option") to the Director upon the terms and conditions evidenced
hereby, as required by the Plan, which Option is not an incentive stock option
within the meaning of Section 422 of the Code.
NOW, THEREFORE, in consideration of the services rendered and to be
rendered by the Director, the Corporation and the Director agree to the terms
and conditions set forth herein as required by the terms of the Plan.
1. OPTION GRANT. This Agreement evidences the grant to the Director, as
of ___________, ____ (the "Option Date"), of an Option to purchase an aggregate
of _____ shares of Common Stock, par value _____ per share, under Section 7.2 of
the Plan, subject to the terms and conditions and to adjustment as set forth
herein or in the Plan.
2. EXERCISE PRICE. The Option entitles the Director to purchase (subject
to the terms of Sections 3 through 5 below and to the extent exercisable) all or
any part of the Option shares at a price per share of $_______, which amount
represents the Fair Market Value of the shares on the Option Date.
3. OPTION EXERCISABILITY AND TERM. The Option shall first become and
remain exercisable as to 25% of the Option shares on the first anniversary of
the Option Date, and as to an additional 25% of the Option shares on each of the
next three anniversaries of that date, in each case subject to adjustment,
acceleration, and termination under Section 7.6 of the Plan. The Option shall
terminate ____________, ____, unless earlier terminated in accordance with the
terms of the Plan.
4. SERVICE AND EFFECT OF TERMINATION OF SERVICE. The Director agrees to
serve as a director in accordance with the provisions of the Corporation's
Certificate of Incorporation, bylaws and applicable law. If the Director's
services as a member of the Board shall terminate, this Option shall terminate
at the times and to the extent set forth in Section 7.5 of the Plan.
<PAGE> 27
5. GENERAL TERMS. The Option and this Agreement are subject to, and the
Corporation and the Director agree to be bound by, the provisions of the Plan
that apply to the Option. Such provisions are incorporated herein by this
reference. The Director acknowledges receiving a copy of the Plan and reading
its applicable provisions. Capitalized terms not otherwise defined herein shall
have the meaning assigned to such terms in the Plan.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
FLOUR CITY INTERNATIONAL, INC.
(a Nevada corporation)
By: ___________________________
Title: ___________________________
Optionee Director
__________________________________
(Signature)
__________________________________
(Print Name)
__________________________________
(Address)
__________________________________
(City, State, Zip Code)
CONSENT OF SPOUSE
In consideration of the execution of the foregoing Stock Option
Agreement by Flour City International, Inc., I, ____________________________,
the spouse of the Director therein named, do hereby agree to be bound by all of
the terms and provisions thereof and of the Plan.
DATED: __________________, 19__.
__________________________________
(Signature of Spouse)
<PAGE> 1
EXHIBIT 10.5
INDEMNIFICATION AGREEMENT
BETWEEN
FLOUR CITY INTERNATIONAL, INC.
AND
------------------------------
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
1. DEFINITIONS ......................................................................1
2. INDEMNIFICATION ...................................................................2
2.1 Indemnification in Third Party Actions ......................................2
2.2 Indemnification in Proceedings By or In the Name of the Company .............2
2.3 Partial Indemnification......................................................2
2.4 Indemnification Hereunder Not Exclusive......................................2
2.5 Indemnification of Indemnified Costs of Successful Party ....................2
2.6 Indemnified Costs Advanced ..................................................3
2.7 Limitations on Indemnification...............................................3
3. PRESUMPTIONS........................................................................3
3.1 Presumption Regarding Standard of Conduct....................................3
3.2 Determination of Right to Indemnification ...................................3
3.2.1 Burden ...............................................................3
3.2.2 Standard .............................................................4
4. OTHER AGREEMENTS....................................................................4
4.1 Change in Control Event......................................................4
4.2 Maintenance of Liability Insurance ..........................................4
4.2.1 Affirmative Covenant of the Company...................................4
4.2.2 Indemnitee Named as Insured...........................................4
4.3 Agreement to Serve...........................................................5
4.4 Effect of this Agreement on Employment Agreement.............................5
4.5 Nature of Rights; Separability ..............................................5
4.6 Savings Clause ..............................................................5
4.7 Repayment of Indemnified Costs ..............................................5
4.8 Repayment ..................................................................5
5. INDEMNIFICATION PROCEDURE...........................................................5
5.1 Notice ......................................................................5
5.2 Company Participation .......................................................5
5.3 Settlement .................................................................6
5.4 Subrogation .................................................................6
6. MISCELLANEOUS PROVISIONS ...........................................................6
6.1 Amendments; Waivers..........................................................6
6.2 Integration..................................................................6
6.3 Interpretation; Governing Law ...............................................6
6.4 Headings.....................................................................6
</TABLE>
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
6.5 Counterparts.................................................................6
6.6 Successors and Assigns.......................................................6
6.7 Expenses; Legal Fees.........................................................7
6.8 Representation by Counsel; Interpretation....................................7
6.9 Specific Performance.........................................................7
6.10 Time is of the Essence.......................................................7
6.11 Notices .....................................................................7
</TABLE>
<PAGE> 4
FLOUR CITY INTERNATIONAL, INC.
INDEMNIFICATION AGREEMENT
This Indemnification Agreement (this "AGREEMENT") is made as of
__________, 1997, by and between Flour City International, Inc., a Nevada
corporation (the "COMPANY"), and the individual whose name appears below the
word "Indemnitee" on the signature page of this Agreement (the "INDEMNITEE"). In
consideration of the services of the Indemnitee to the Company, and to induce
the Indemnitee to continue to serve as a director and/or officer, the Company
and the Indemnitee agree as follows:
R E C I T A L S
A. The Indemnitee has agreed to serve as a director and/or officer of
the Company and in such capacity will render valuable services to the Company.
B. The Company has concluded that insurance and statutory indemnity
provisions may provide inadequate protection to individuals requested to serve
as its directors and officers.
C. To induce and encourage the Indemnitee to serve as a director and/or
officer of the Company, the Company's Board of Directors has decided that this
Agreement is not only reasonable and prudent, but necessary, to promote and
ensure the best interests of the Company and its stockholders.
1. DEFINITIONS
As used in this Agreement:
"AGENT" means a director, officer, employee or agent of the Company or
of any other corporation, partnership, joint venture, trust, employee benefit
plan, or other enterprise that the Indemnitee served in any of such capacities
at the request of the Company.
"CHANGE IN CONTROL EVENT" has the same meaning as an "Event" as defined
in the Company's 1997 Amended and Restated Stock Incentive Plan.
"EXPENSES" includes, but is not limited to, attorneys' fees,
disbursements and retainers, accounting and witness fees, travel and deposition
costs, expenses of investigations and amounts paid in settlement by or on behalf
of the Indemnitee, and any expenses of establishing a right to indemnification
pursuant to this Agreement, to the extent actually and reasonably incurred by
the Indemnitee in connection with any Proceeding. "EXPENSES" does not include
the amount of judgments, fines, penalties or ERISA excise taxes actually levied
against the Indemnitee.
"INDEMNIFIED COSTS" means all Expenses, judgments, fines, penalties and
ERISA excise taxes actually and reasonably incurred by the Indemnitee in
connection with the investigation, defense, appeal, or settlement of any
Proceeding.
A "POTENTIAL CHANGE IN CONTROL EVENT" will be deemed to have occurred
if:
(a) the Company enters into an agreement or arrangement that
would constitute a Change in Control Event if consummated;
<PAGE> 5
(b) any person (including the Company) publicly announces an
intention to take or to consider taking actions that would constitute a Change
in Control Event if consummated; or
(c) the Board of Directors adopts a resolution to the effect
that, for purposes of this Agreement, a Potential Change in Control Event has
occurred.
"PROCEEDING" means any threatened, pending or completed action, suit or
proceeding (including appeals thereof), whether brought by or in the name of the
Company or otherwise and whether of a civil, criminal or administrative or
investigative nature, in which the Indemnitee is or will be a party at the time
because the Indemnitee is or was an Agent, whether or not the Indemnitee is
serving in such capacity at the time any liability or Expense is incurred for
which indemnification or reimbursement is to be provided under this Agreement.
2. INDEMNIFICATION
2.1 INDEMNIFICATION IN THIRD PARTY ACTIONS. The Company will indemnify
the Indemnitee if the Indemnitee becomes a party to, is threatened to be made a
party to, is a witness or other participant in, or is otherwise involved in any
Proceeding (other than a Proceeding by or in the name of the Company to procure
a judgment in its favor), because the Indemnitee is or was an Agent, against all
Indemnified Costs, to the fullest extent permitted by applicable law. Any
settlement must be approved in writing by the Company.
2.2 INDEMNIFICATION IN PROCEEDINGS BY OR IN THE NAME OF THE COMPANY. The
Company will indemnify the Indemnitee if the Indemnitee is a party to, is
threatened to be made a party to, is a witness or other participant in, or is
otherwise involved in any Proceeding by or in the name of the Company to procure
a judgment in its favor because the Indemnitee was or is an Agent of the Company
against all Expenses in connection with the defense or settlement of the
Proceeding, to the fullest extent permitted by applicable law.
2.3 PARTIAL INDEMNIFICATION. If the Indemnitee is entitled under any
provision of this Agreement to indemnification by the Company for some or a
portion of, but not the total amount of, the Indemnified Costs, the Company will
nevertheless indemnify the Indemnitee for the portion of the Indemnified Costs
to which the Indemnitee is entitled.
2.4 INDEMNIFICATION HEREUNDER NOT EXCLUSIVE. The indemnification
provided by this Agreement is not exclusive of any other rights to which the
Indemnitee may be entitled under the Company's Certificate of Incorporation, the
Bylaws, any agreement, any vote of stockholders or disinterested directors,
applicable law, or otherwise, both as to action in the Indemnitee's official
capacity and as to action in another capacity on behalf of the Company.
2.5 INDEMNIFICATION OF INDEMNIFIED COSTS OF SUCCESSFUL PARTY.
Notwithstanding any other provisions of this Agreement, to the extent that the
Indemnitee has been successful in defense of any Proceeding or in defense of any
claim, issue or matter in the Proceeding, on the merits or otherwise, including,
but not limited to, the dismissal of a Proceeding without prejudice, the
Indemnitee will be indemnified against all Indemnified Costs incurred in
connection therewith to the fullest extent permitted by applicable law.
2
<PAGE> 6
2.6 INDEMNIFIED COSTS ADVANCED. The Indemnified Costs incurred by the
Indemnitee in any Proceeding will be paid promptly by the Company in advance of
the final disposition of the Proceeding at the written request of the Indemnitee
to the fullest extent permitted by applicable law. The advances to be made will
be paid by the Company to the Indemnitee within 30 days following delivery of
the written request by Indemnitee to the Company, accompanied by substantiated
documentation.
2.7 LIMITATIONS ON INDEMNIFICATION. Notwithstanding anything to the
contrary in this Agreement, the Company is not required to make payments to:
(a) indemnify or advance Indemnified Costs with respect to
Proceedings initiated or brought voluntarily by the Indemnitee and not by way of
defense, except with respect to Proceedings brought to establish or enforce a
right to indemnification under this Agreement or any other statute or law or
otherwise as required under applicable law;
(b) indemnify the Indemnitee for any Indemnified Costs for which
payment is actually made to the Indemnitee under an insurance policy, except for
any excess beyond the amount of payment under the policy;
(c) indemnify the Indemnitee for any Indemnified Costs sustained in
any Proceeding for an accounting of profits made from the purchase or sale by
the Indemnitee of securities of the Company pursuant to Section 16(b) of the
Securities Exchange Act of 1934, as amended, the rules and regulations
promulgated thereunder and amendments thereto or similar provisions of any
federal, state or local law;
(d) the Indemnitee for any Indemnified Costs resulting from
Indemnitee's conduct that is finally adjudged by a court of competent
jurisdiction to have been willful misconduct, knowingly fraudulent or
deliberately dishonest; or
(e) indemnify the Indemnitee if a court of competent jurisdiction
finally determines that such payment is unlawful.
3. PRESUMPTIONS
3.1 PRESUMPTION REGARDING STANDARD OF CONDUCT. The Indemnitee will be
conclusively presumed to have met the relevant standards of conduct as defined
by applicable law for indemnification pursuant to this Agreement unless a
determination that the Indemnitee has not met the relevant standards is made by
(a) the Board of Directors of the Company by a majority vote of a quorum
consisting of directors who are not parties to the Proceeding, (b) the
stockholders of the Company by majority vote, or (c) in a written opinion by
independent legal counsel, selection of whom has been made by the Company's
Board of Directors and approved by the Indemnitee.
3.2 DETERMINATION OF RIGHT TO INDEMNIFICATION.
3.2.1 BURDEN. If a claim under this Agreement is not paid by the
Company within 30 days of receipt of written notice, the right to
indemnification as provided by this Agreement will be enforceable by the
Indemnitee in any court of competent jurisdiction. The burden of proving by
clear and convincing evidence that indemnification or advances are not
appropriate will be on the Company. Neither the failure of the directors,
stockholders, or independent legal counsel to have made a determination prior
3
<PAGE> 7
to the commencement of the action that indemnification or advances are proper in
the circumstances because the Indemnitee has met the applicable standard of
conduct, nor an actual determination by the directors, stockholders or
independent legal counsel that the Indemnitee has not met the applicable
standard of conduct, will be a defense to the action or create a presumption
that the Indemnitee has not met the applicable standard of conduct.
3.2.2 STANDARD. The Indemnitee's Expenses incurred in connection
with any Proceeding concerning the Indemnitee's right to indemnification or
advances in whole or in part pursuant to this Agreement will be indemnified by
the Company regardless of the outcome of the Proceeding, unless a court of
competent jurisdiction determines that each of the material assertions made by
the Indemnitee in the Proceeding was not made in good faith or was frivolous.
4. OTHER AGREEMENTS
4.1 CHANGE IN CONTROL EVENT. If there is a Change in Control Event or a
Potential Change in Control Event of the Company (other than a Change in Control
Event or Potential Change in Control Event that has been approved by a majority
of the Company's Board of Directors who were directors immediately prior to the
Change in Control Event or Potential Change in Control Event), then with respect
to all matters thereafter arising concerning the rights of the Indemnitee to be
indemnified for Indemnified Costs, the Company will seek legal advice only from
independent counsel selected by the Indemnitee, and reasonably satisfactory to
the Company, and who has not otherwise performed other services for the Company
or the Indemnitee within the last three years ("SPECIAL INDEPENDENT COUNSEL").
The Special Independent Counsel, among other things, will render its written
opinion to the Company and the Indemnitee as to whether and to what extent the
Indemnitee would be permitted to be indemnified under applicable law. The
Company will pay the reasonable fees and expenses of the Special Independent
Counsel.
4.2 MAINTENANCE OF LIABILITY INSURANCE.
4.2.1 AFFIRMATIVE COVENANT OF THE COMPANY. While the Indemnitee
continues to serve as a director or officer of the Company, and thereafter while
the Indemnitee is subject to any possible Proceeding, the Company will maintain
in full force and effect directors' and officers' liability insurance ("D&O
INSURANCE") in reasonable amounts from reputable insurers. The Company has no
obligation, however, to obtain or maintain D&O Insurance if it determines in
good faith that insurance is not reasonably available, the premium costs for
insurance are disproportionate to the amount of coverage provided, the coverage
provided by insurance is so limited by exclusions that it provides an
insufficient benefit, or the Indemnitee is covered by similar insurance
maintained by a subsidiary of the Company. If the Company has D&O Insurance at
the time it receives a notice that a Proceeding has commenced, the Company will
give prompt notice of such commencement to the insurers as required by the
respective policies. The Company will thereafter take all necessary or desirable
action to cause such insurers to pay, on behalf of the Indemnitee, all amounts
payable as a result of such proceeding in accordance with the terms of such
policies.
4.2.2 INDEMNITEE NAMED AS INSURED. In all D&O Insurance policies,
the Indemnitee will be named as an insured in a manner that provides the
Indemnitee the same rights and benefits accorded to the most favorably insured
of the Company's directors and officers.
4
<PAGE> 8
4.3 AGREEMENT TO SERVE. Indemnitee will serve or continue to serve as an
Agent of the Company for so long as the Indemnitee is duly elected or appointed
or until the Indemnitee voluntarily resigns. Indemnitee will give notice to the
Company at least thirty (30) days prior to voluntarily resigning.
4.4 EFFECT OF THIS AGREEMENT ON EMPLOYMENT AGREEMENT. Any present or
future employment agreement between the Indemnitee and the Company is not
modified by this Agreement. Nothing contained in this Agreement creates in the
Indemnitee any right of continued employment.
4.5 NATURE OF RIGHTS; SEPARABILITY. The rights afforded to the
Indemnitee by this Agreement are contract rights and may not be diminished,
eliminated or otherwise affected by amendments to the Company's Certificate of
Incorporation, Bylaws or agreements, including D&O Insurance policies. Each
provision of this Agreement, to the extent practicable, is a separate and
distinct agreement and independent of the others, so that if any provision of
this Agreement is held to be invalid or unenforceable for any reason, the
invalidity or unenforceability will not affect the validity or enforceability of
the other provisions. To the extent required, any provision of this Agreement
may be modified by a court of competent jurisdiction to preserve its validity
and to provide the Indemnitee with the broadest possible indemnification
permitted under applicable law.
4.6 SAVINGS CLAUSE. If this Agreement or any portion of it is
invalidated on any ground by any court of competent jurisdiction, then the
Company will nevertheless indemnify the Indemnitee as to Indemnified Costs with
respect to any Proceeding to the full extent permitted by any applicable portion
of this Agreement that is not invalidated, or by any applicable law.
4.7 REPAYMENT OF INDEMNIFIED COSTS. The Indemnitee will reimburse the
Company for all Indemnified Costs paid by the Company in defending any
Proceeding against the Indemnitee if and only to the extent that a court of
competent jurisdiction finally decides that the Indemnitee is not entitled to be
indemnified by the Company for such Indemnified Costs under the provisions of
applicable law, the Company's Bylaws, Certificate of Incorporation, this
Agreement, or otherwise. The Indemnitee will repay such amounts advanced only
if, and to the extent that, it is ultimately determined that Indemnitee is not
entitled to be indemnified for such Indemnified Costs by the Company pursuant to
this Agreement.
4.8 REPAYMENT. The Indemnitee will promptly repay to the Company any
amounts paid to the Indemnitee pursuant to other rights of indemnification or
under any insurance policy, to the extent those payments are duplicative of
payments under this Agreement.
5. INDEMNIFICATION PROCEDURE
5.1 NOTICE. Promptly after receipt of notice that a Proceeding has
commenced, the Indemnitee will, if a claim is to be made under this Agreement,
notify the Company of that fact. The failure to notify the Company will not
relieve it from any liability that it may have to the Indemnitee except to the
extent of the Company's material damage resulting from such failure.
5.2 COMPANY PARTICIPATION. The Company will be entitled to participate
in any Proceeding at its own expense and, except as otherwise provided below, to
the extent that it may wish, the Company may assume the defense of any
Proceeding for which indemnification is sought hereunder, with counsel
reasonably satisfactory to the Indemnitee. After the Company notifies the
Indemnitee of the Company's election to assume the defense of a Proceeding,
during the Company's good faith defense the
5
<PAGE> 9
Company will not be liable to the Indemnitee under this Agreement for any legal
or other expenses subsequently incurred by the Indemnitee in connection with the
defense of the Proceeding, other than reasonable costs of investigation or as
otherwise provided below. The Indemnitee will have the right to employ the
Indemnitee's counsel in any Proceeding, but the fees and expenses of the counsel
incurred after the Company assumes the defense of the Proceeding will be at the
expense of the Indemnitee, unless (a) the employment of counsel by the
Indemnitee has been authorized by the Company, (b) the Indemnitee has reasonably
concluded that there is be a conflict of interest between the Company and the
Indemnitee in the conduct of the defense of a Proceeding, or (c) the Company has
not in fact employed counsel to assume the defense of a Proceeding. In each of
the foregoing cases the fees and expenses of the Indemnitee's counsel will be at
the expense of the Company. The Company will not be entitled to assume the
defense of any Proceeding brought by or on behalf of the Company or as to which
the Indemnitee has made the conclusion that there may be a conflict of interest
between the Company and the Indemnitee.
5.3 SETTLEMENT. The Company will not settle or compromise any Proceeding
in any manner that would impose any penalty or limitation on the Indemnitee
without the Indemnitee's consent. The Indemnitee will not settle or compromise
any Proceeding without the Company's consent. Neither the Company nor the
Indemnitee will unreasonably withhold their consent or approval under this
Agreement.
5.4 SUBROGATION. If the Company pays Indemnified Costs, the Company will
be subrogated to the extent of such payment to all of the rights of recovery of
the Indemnitee against third parties. The Indemnitee will do all things
reasonably necessary to secure such rights, including the execution of documents
necessary to enable the Company effectively to bring suit to enforce such
rights.
6. MISCELLANEOUS PROVISIONS
6.1 AMENDMENTS; WAIVERS. Amendments, waivers, consents and approvals
under this Agreement must be in writing and designated as such. No failure or
delay in exercising any right will be deemed a waiver of such right.
6.2 INTEGRATION. This Agreement is the entire agreement between the
parties pertaining to its subject matter, and supersedes all prior agreements
and understandings of the parties in connection with such subject matter.
6.3 INTERPRETATION; GOVERNING LAW. This Agreement is to be construed as
a whole and in accordance with its fair meaning. This Agreement is to be
interpreted in accordance with the laws of the State of Delaware relating to
indemnification of Agents.
6.4 HEADINGS. Headings of Sections and subsections are for convenience
only and are not a part of this Agreement.
6.5 COUNTERPARTS. This Agreement may be signed in one or more
counterparts, all of which constitute one agreement.
6.6 SUCCESSORS AND ASSIGNS. This Agreement is binding upon and inures to
the benefit of each party and such party's respective heirs, personal
representatives, successors and assigns. Nothing in this Agreement, express or
implied, is intended to confer any rights or remedies upon any other person.
6
<PAGE> 10
6.7 EXPENSES; LEGAL FEES. Each party will pay its own expenses in the
negotiation, preparation and performance of this Agreement. The prevailing party
in any action relating to this Agreement will be entitled to reasonable legal
fees, costs and expenses incurred in such action.
6.8 REPRESENTATION BY COUNSEL; INTERPRETATION. Each party acknowledges
that it has been given an opportunity to be represented by counsel in connection
with this Agreement. Any rule of law, including, but not limited to, Section
1654 of the California Civil Code, or any legal decision that would require
interpretation of any claimed ambiguities in this Agreement against the party
that drafted it, has no application and is expressly waived.
6.9 SPECIFIC PERFORMANCE. The Company acknowledges that in view of the
uniqueness of the matters contemplated by this Agreement, the Indemnitee would
not have an adequate remedy at law for money damages if this Agreement is not
being performed in accordance with its terms. The Company therefore agrees that
the Indemnitee will be entitled to specific enforcement of the terms hereof in
addition to any other remedy to which the Indemnitee may be entitled.
6.10 TIME IS OF THE ESSENCE. Time is of the essence in the performance
of each provision of this Agreement.
6.11 NOTICES. Any notice to be given hereunder must be in writing and
delivered as follows (or to another address designated in writing):
IF TO FLOUR CITY INTERNATIONAL, INC.:
______________________________________
______________________________________
IF TO THE INDEMNITEE:
______________________________________
______________________________________
The parties have signed this Agreement as of the date on page one.
INDEMNITEE
______________________________________________
Print Name:
FLOUR CITY INTERNATIONAL, INC.
________________________________
By: _________________________
Title: _________________________
7
<PAGE> 1
EXHIBIT 10.6
EMPLOYMENT AGREEMENT
BY AND BETWEEN
FLOUR CITY ARCHITECTURAL METALS, INC.
AND
MICHAEL J. RUSSO
<PAGE> 2
EMPLOYMENT AGREEMENT
I N D E X
<TABLE>
<S> <C>
1. EMPLOYMENT.....................................................................1
2. TITLES AND DUTIES..............................................................1
2.1 Initial Appointments.....................................................1
3. COMPENSATION...................................................................2
3.1 Base Salary..............................................................2
3.2 Benefits.................................................................2
4. STOCK PURCHASE RIGHTS..........................................................4
4.1 Stock Purchase Rights....................................................4
4.2 Disposition of Shares....................................................4
4.3 Transfer Restrictions....................................................6
4.4 Employer's Repurchase Right..............................................6
4.5 Fractional Shares........................................................8
4.6 Additional Shares or Substituted Securities..............................8
4.7 Special Termination of Repurchase Right..................................9
4.8 Cancellation of Shares...................................................9
4.9 Additional Rights.......................................................10
5. DISABILITY OR DEATH...........................................................10
6. TERMINATION...................................................................11
6.1 Termination by Employer.................................................11
6.2 Termination by Executive................................................12
7. ARBITRATION...................................................................12
8. PLACE OF PERFORMANCE..........................................................13
9. NON-DISCLOSURE................................................................13
10. NON-COMPETITION AND NON-SOLICITATION..........................................14
11. ASSIGNMENT OF WORK PRODUCT....................................................15
</TABLE>
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<PAGE> 3
<TABLE>
<S> <C>
12. GENERAL PROVISIONS............................................................15
12.1 Governing Law and Jurisdiction..........................................15
12.2 Notices.................................................................15
12.3 Attorneys' Fees.........................................................15
12.4 Complete Agreement......................................................16
12.5 Binding.................................................................16
12.6 Authority...............................................................16
12.7 Number and Gender.......................................................17
12.8 Failure to Object Not a Waiver..........................................17
12.9 Unenforceable Terms.....................................................17
12.10 Execution in Counterparts...............................................17
12.11 Further Assurance.......................................................17
12.12 CrossReferences.........................................................18
12.13 Miscellaneous Provisions................................................18
</TABLE>
ii
<PAGE> 4
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement"), is made and entered on the 16th
day of January, 1997 (the "Execution Date"), by and between Flour City
International, Inc., a Nevada corporation ("Company"); Flour City Architectural
Metals, Inc., a Delaware corporation ("Employer"); and Michael J. Russo
("Executive"), (Employer and Executive are sometimes hereinafter referred to
collectively as the "Parties" and individually as a "Party").
RECITALS
A. Employer is a company engaged in the business of engineering,
management and construction of custom curtain wall projects; and
B. Executive has particular and peculiar knowledge and background in
performing executive level management services and related activities for a
business of this nature; and
C. The parties hereto desire to enter into an Agreement whereby the
Executive's services will be made available to Employer.
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter contained, the parties hereto agree as follows:
1. EMPLOYMENT
Employer shall employ Executive as its President and Chief Executive
Officer for a term of five (5) consecutive years (the "Term"), commencing on
January 1, 1997 (the "Effective Date"). The employment relationship created by
this Agreement may only be terminated prior to the expiration of the Term in
accordance with the provisions of Sections 5 and 6 hereof and in accordance with
the terms and conditions contained therein.
2. TITLES AND DUTIES.
2.1 INITIAL APPOINTMENTS.
Subject at all times to the supervision and direction of Employer's
Board of Directors, Executive shall be employed as the President and Chief
Executive Officer of Employer to perform such executive and other duties
relating to the business and operations of the Company
<PAGE> 5
and any present or future subsidiaries or affiliates thereof as are delegated or
assigned to the Executive from time to time by such Board of Directors and are
consistent with the position of President and Chief Executive Officer. Executive
shall faithfully and diligently perform all duties and will promote and advance
the business and affairs of Employer.
3. COMPENSATION.
3.1 BASE SALARY.
3.1.1 Executive will be paid an annual base salary of $130,000
("Base Salary") commencing as of the Effective Date. The Base Salary shall be
payable in equal bi-weekly installments.
3.1.2 Executive's Base Salary shall be evaluated on an annual
basis by the Board of Directors. Executive's Base Salary may be increased in the
sole discretion of the Board of Directors, but never decreased during the Term,
without the consent of Executive.
3.2 BENEFITS.
In addition to the Base Salary, Executive shall receive the following
benefits:
3.2.1 During the period for which Executive is employed by
Employer, Employer shall purchase medical health insurance for Executive (which
health insurance shall also cover Executive's spouse and certain children) of
the type and in such amounts as is available from time to time to all other
executives of Employer;
3.2.2 During the period for which Executive is employed by
Employer, Executive shall be entitled to (a) a vacation period each year of
fifteen (15) business days and (b) additional holidays customarily observed by
Employer, and during such time, Executive's compensation shall be paid in full;
provided, however, that if Executive does not take all or a portion of the
vacation time to which Executive is entitled hereunder, Employer shall
compensate Executive therefor on such terms as Employer and Executive may
mutually agree;
3.2.3 During the period for which Executive is employed by
Employer, and within five (5) business days of the submission of the appropriate
documentation by Executive,
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<PAGE> 6
Executive shall be reimbursed by Employer for all ordinary and necessary
business expenses reasonably incurred by Executive in the performance of
Executive's duties, provided that:
3.2.3.1 Each such expenditure is of a nature qualifying it as
a proper business expense of Employer; and
3.2.3.2 Executive furnishes to Employer adequate records and
other documentation as may be reasonably required by Employer for the
substantiation of such expenditures as a business expense of Employer.
3.2.4 During the period for which Executive is employed by
Employer, Executive shall be entitled to the use of an automobile which shall be
purchased or leased at the Employer's expense; provided that, Executive shall be
responsible for any taxes associated with Executives personal use of the
automobile.
4. STOCK PURCHASE RIGHTS.
4.1 STOCK PURCHASE RIGHTS
4.1.1 Subject to and upon the terms and conditions set forth in
this Section 4, Executive is hereby granted the exclusive right to purchase a
total of 500,000 shares of Company's Common Stock (the "Shares"), representing
five percent (5%) of the total issued and outstanding shares of Company as of
the Effective Date, at the price of $.0001 per Share (the "Purchase Price").
4.1.2 By executing this Agreement, Executive hereby warrants and
represents that Executive will acquire the Shares for Executive's own account
and not with a view to their resale or distribution and that Executive is
prepared to hold the Shares for an indefinite period and has no present
intention to sell, distribute or grant any participating interests in the
Shares. Executive hereby acknowledges the fact that the Shares have not been
registered under the Securities Act of 1933, as amended (the "1933 Act"), and
that Company is issuing the Shares to Executive in reliance on the
representations made by Executive herein.
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<PAGE> 7
4.1.3 Executive hereby confirms that Executive has been informed
that the Shares may not be resold or transferred unless the Shares are first
registered under Federal and applicable state securities laws or an exemption
therefrom is available. Accordingly, Executive hereby acknowledges that
Executive is prepared to hold the Shares for an indefinite period and that
Executive is aware that Rule 144 of the Securities and Exchange Commission
issued under the 1933 Act is not presently available to exempt the sale of the
Shares from the registration requirements of the 1933 Act. Should Rule 144
subsequently become available, Executive is aware that any sale of the Shares
effected pursuant to Rule 144 may, depending upon the status of Executive as an
"affiliate" or "non-affiliate" under the Rule, be made only in limited amounts
in accordance with the provisions of the Rule, and that in no event may any
Shares be sold pursuant to the Rule until Executive has held the Shares for the
requisite holding period following payment in full for the Shares.
4.1.4 Executive represents and warrants that Executive has a
preexisting business or personal relationship with the officers and directors of
Company, that Executive is aware of the business affairs and financial condition
of Company and that Executive has such knowledge and experience in business and
financial matters with respect to companies in business similar to Company's
which enables Executive to evaluate the risks of the prospective investment and
to make an informed investment decision with respect thereto. Executive further
represents and warrants that Company has made available to Executive the
opportunity to ask questions and receive answers from Company concerning the
terms and conditions of the issuance of the Shares and that Executive could be
reasonably assumed to have the capacity to protect Executive's own interests in
connection with such investment.
4.2 DISPOSITION OF SHARES.
4.2.1 Executive hereby agrees that Executive shall make no
disposition of the Shares (other than a permitted transfer under paragraph
4.3.1) unless and until:
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<PAGE> 8
(a) Executive shall have notified Company of the proposed
disposition and provided a written summary of the terms and conditions of the
proposed disposition;
(b) Executive shall have complied with all requirements of this
Agreement applicable to the disposition of the Shares; and
(c) Executive shall have provided Company with written
assurances, in form and substance satisfactory to Company that (i) the proposed
disposition does not require registration of the Shares under the 1933 Act or
(ii) all appropriate action necessary for compliance with the registration
requirements of the 1933 Act or any exemption from registration available under
the 1933 Act has been taken.
Company shall not be required (i) to transfer on its books any
Shares which have been sold or transferred in violation of the provisions of
this Section 4 or (ii) to treat as the owner of the Shares, or otherwise to
accord voting or dividend rights to, any transferee to whom the Shares have been
transferred in contravention of this Agreement.
4.2.2 In order to reflect the restrictions on disposition of the
Shares, the stock certificates for the Shares will be endorsed with restrictive
legends, including the legends substantially as follows:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933. THE SHARES HAVE BEEN ACQUIRED FOR
INVESTMENT AND MAY NOT BE SOLD OR OFFERED FOR SALE IN THE ABSENCE OF (A)
AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER SUCH ACT, (B) A
"NO ACTION" LETTER OF THE SECURITIES AND EXCHANGE COMMISSION WITH
RESPECT TO SUCH SALE OR OFFER, OR SATISFACTORY ASSURANCES TO THE
CORPORATION THAT REGISTRATION UNDER SUCH ACT IS NOT REQUIRED WITH
RESPECT TO SUCH SALE OR OFFER.
THIS CERTIFICATE AND THE SHARES REPRESENTED HEREBY MAY NOT BE SOLD,
ASSIGNED, TRANSFERRED, ENCUMBERED, OR IN ANY MANNER DISPOSED OF EXCEPT
IN CONFORMITY WITH THE TERMS OF A WRITTEN AGREEMENT, DATED JANUARY 16,
1997 BETWEEN THE CORPORATION AND THE REGISTERED HOLDER OF THE SHARES (OR
ITS ASSIGNEES) WHICH CONTAINS CERTAIN RIGHTS OF REPURCHASE
5
<PAGE> 9
UPON THE SALE, ASSIGNMENT, TRANSFER, ENCUMBRANCE OR OTHER DISPOSITION
OF THE CORPORATION'S SHARES OR UPON TERMINATION OF SERVICE WITH THE
CORPORATION. THE CORPORATION WILL, UPON WRITTEN REQUEST, FURNISH A COPY
OF SUCH AGREEMENT TO THE HOLDER HEREOF WITHOUT CHARGE.
4.2.3 Until such time as Company actually exercises its
repurchase rights under this Agreement, Executive (or any successor in interest)
shall have all the rights of a stockholder (including voting and dividend
rights) with respect to the Shares, subject, however, to the transfer
restrictions of this Section 4.
4.3 TRANSFER RESTRICTIONS.
4.3.1 Executive shall not transfer, assign, encumber or otherwise
dispose of any of the Shares which are subject to Company's repurchase rights
under this Section 4. Such restrictions on transfer, however, shall not be
applicable to (i) a gratuitous transfer of the Shares made to the Executive's
spouse or issue, including adopted children, or to a corporation, trust or
partnership for the exclusive benefit of the Executive or the Executive's spouse
or issue, or (ii) a transfer of title to the Shares effected pursuant to the
Executive's will or the laws of intestate succession.
4.3.2 Each person (other than Company) to whom the Shares are
transferred by means of one of the permitted transfers specified in paragraph
4.3.1 must, as a condition precedent to the validity of such transfer,
acknowledge in writing, the Company's repurchase rights granted hereunder, to
the same extent such shares would be so subject if retained by the Executive.
4.4 COMPANY'S REPURCHASE RIGHT.
4.4.1 The Company may repurchase all or any portion of the
Shares purchased by Executive hereunder, at the Purchase Price (the "Repurchase
Right") in which the Executive has not acquired a vested interest in accordance
with the vesting provisions of paragraph 4.4.3 (such shares to be
6
<PAGE> 10
hereinafter called the "Unvested Shares"), solely in the event that Executive's
employment with the Company is terminated for any reason. Company's Repurchase
Rights with respect to the Unvested Shares shall be exercisable at any time
for a period of ninety (90) days following the effective date of Executives
termination of employment with the Company.
4.4.2 The Repurchase Right shall be exercisable by written notice
delivered to the Executive prior to the expiration of Company's Repurchase
Right. The notice shall indicate the number of Unvested Shares to be repurchased
and the date on which the repurchase is to be effected, such date to be not more
than thirty (30) days after the date of notice. Executive shall, prior to the
close of business on the date specified for the repurchase, deliver to the
Secretary of the Company the certificates representing the Unvested Shares to be
repurchased, each certificate to be properly endorsed for transfer. Company
shall, concurrently with the receipt of such stock certificates, pay to
Executive in cash or cash equivalents (including the cancellation of any
purchase-money indebtedness), an amount equal to the Purchase Price for the
Unvested Shares which are to be repurchased.
4.4.3 The Repurchase Right shall terminate with respect to any
Unvested Shares for which it is not timely exercised under paragraph 4.4.2. In
addition, the Repurchase Right shall terminate, and cease to be exercisable,
with respect to any and all Shares in which the Executive vests in accordance
with the following schedule. Executive shall acquire a vested interest in, and
the Repurchase Right shall lapse with respect to, the Shares in accordance with
the following provisions:
(i) Twenty percent (20%) of the Shares purchased by
Executive shall vest one (1) year from the Effective Date; provided, that,
Company has "earnings before income taxes" ("EBIT") for the Company's 1997
fiscal year ending during this period in excess of $2,000,000;
(ii) Twenty percent (20%) of the Shares purchased by
Executive shall vest two (2) years from the Effective Date; provided, that,
Company has EBIT for the Company's 1998 fiscal year ending during this period in
excess of $3,000,000; or "cumulative EBIT"
7
<PAGE> 11
("CEBIT") in excess of $6,000,000; for purposes of this Section 4, CEBIT means
the cumulative annual fiscal EBIT during the term of this Agreement through the
date of calculation;
(iii) Twenty percent (20%) of the Shares purchased by
Executive shall vest three (3) years from the Effective Date; provided, that,
Company has EBIT for Company's 1999 fiscal year ending during this period in
excess of $4,000,000; or CEBIT in excess of $10,800,000;
(iv) Twenty percent (20%) of the Shares purchased by
Executive shall vest four (4) years from the Effective Date; provided, that,
Company has EBIT for Company's 2000 fiscal year ending during this period in
excess of $5,000,000; or CEBIT in excess of $16,800,000; and
(v) Twenty percent (20%) of the Shares purchased by
Executive shall vest five (5) years from the Effective Date; provided, that,
Company has EBIT for Company's 2001 fiscal year ending during this period in
excess of $6,000,000; or CEBIT in excess of $24,000,000.
In the event Company does not have the requisite EBIT or CEBIT for its
fiscal year ending during any of the foregoing annual periods in which a
determination is made as to whether that portion of Shares vest, then all such
Shares attributable to that annual period shall be treated and shall remain
Unvested Shares until December 31, 2001 at which time all previously Unvested
Shares shall automatically vest and the Company's Repurchase Right shall
terminate.
4.5 FRACTIONAL SHARES.
No fractional shares shall be repurchased by Company. Accordingly,
should the Repurchase Right extend to a fractional share, then such fractional
share shall be added to any fractional share in which the Executive is at such
time vested in order to make one whole vested share no longer subject to the
Repurchase Right.
4.6 ADDITIONAL SHARES OR SUBSTITUTED SECURITIES.
In the event of any stock dividend, stock split, recapitalization or
other transaction affecting the Employer's outstanding Common Stock as a class
without receipt of consideration, then any new, substituted or additional
securities or other property (including money paid other
8
<PAGE> 12
than as a regular cash dividend) which is by reason of any such transaction
distributed with respect to the Shares shall be immediately subject to the
Repurchase Right, but only to the extent the Shares are at the time covered by
such right. Appropriate adjustments to reflect the distribution of such
securities or property shall be made to the number of Shares for all purposes
relating to the Repurchase Right. Appropriate adjustments shall also be made to
the price per share to be paid upon the exercise of the Repurchase Right in
order to reflect the effect of any such transaction upon the Employer's capital
structure; provided, however, that the aggregate purchase price shall remain the
same.
4.7 SPECIAL TERMINATION OF REPURCHASE RIGHT.
In the event of any of the following transactions (a "Corporate
Transaction"), other than a Corporate Transaction that occurs during the initial
12 months following the Effective Date:
(i) a merger or acquisition in which the Company is not the
surviving entity, except for a transaction the principal purpose of which is to
change the State in which the Company is incorporated,
(ii) the sale, transfer or other disposition of all or
substantially all of the assets of the Company, or
(iii) any other corporate reorganization or business combination
in which fifty percent (50%) or more of the outstanding voting stock of the
Company is transferred, or exchanged through merger, to different holders in a
single transaction of the Company or a series of related transactions, then the
Company shall terminate the Repurchase Right in whole as of the effective date
of the Corporate Transaction.
4.8 CANCELLATION OF SHARES.
If the Company (or its assignees) shall make available, at the time and
place and in the amount and form provided in this Agreement, the consideration
for the Shares to be repurchased in accordance with the provisions of this
Agreement, then from and after such time, the person from whom such shares are
to be repurchased shall no longer have any rights as a holder of such
9
<PAGE> 13
shares (other than the right to receive payment of such consideration in
accordance with this Agreement), and such shares shall be deemed purchased in
accordance with the applicable provisions hereof and the Company (or its
assignees) shall be deemed the owner and holder of such shares, whether or not
the certificates therefor have been delivered to the Company pursuant to this
Agreement.
4.9 ADDITIONAL RIGHTS.
The shares of Company's common stock issued to Executive hereunder,
shall be in addition to any additional stock or stock options which may be
granted to Executive by Company from time to time hereafter. In the event
Executive is granted stock options during Executive's association with Company,
the number of shares of common stock subject to the option and the price per
share thereof shall be proportionately adjusted for any increase or decrease in
the number of issued and outstanding shares of Company's common stock resulting
from any subdivision or consolidation of shares of Company's common stock or the
payment of a stock dividend (but only on common stock) or any other increases or
decrease in the number of such shares affected without the receipt of
consideration by Company. The issuance of shares of common stock upon the
conversion of convertible securities shall be treated as an issuance for which
Company received consideration for this purpose.
5. DISABILITY OR DEATH.
Employer shall have the right to terminate this Agreement in the event
of Executive's death or if Executive becomes permanently disabled. In the event
of Executive's permanent disability, Employer shall continue to pay the Base
Salary that would have otherwise been earned by Executive for a period of six
(6) months from the date of certification by an attending physician; provided,
however, that Employer's obligation hereunder shall be reduced to the extent of
any disability insurance payments received by Executive. In the event of the
death of Executive, Executive's estate will receive the Base Salary that would
have otherwise been earned by Executive for a period of twelve (12) months. For
purposes of this Agreement, the phrase
10
<PAGE> 14
"permanently disabled" shall mean the inability of Executive to perform
Executive's duties hereunder for a continuous period of more than three (3)
consecutive months during any twelve (12) month period. Such permanent
disability shall be determined by Executive's attending physician.
6. TERMINATION.
6.1 TERMINATION BY EMPLOYER.
6.1.1 Except as expressly provided in Section 5 hereof Employer
may terminate Executive's employment hereunder for "cause" only in accordance
with the provisions of this Section 6.1.1, or "without cause" only in accordance
with the provisions of Section 6.1.2 hereinbelow. For purposes of this
Agreement, the term "cause" shall mean a material breach of this Agreement by
Executive or the willful and continued failure by Executive to substantially
perform Executive's duties hereunder. In the event termination is for cause,
Employer is not required to give advance notice to Executive. Employer will
continue the payment of Base Salary and all benefits provided for herein for a
ten (10) day period following notice of termination
6.1.2 Employer may terminate Executive's employment without cause
only in the event that Employer incurs a "net loss" for two (2) consecutive
quarters in excess of $250,000 per quarter; or absent such losses, only upon the
approval of a majority of Employer's Board of Directors, and if employed by
Employer at such time, the consent of either Bryan Willis or Roger Ulbricht. In
the event Executive's employment is terminated without cause Executive shall
receive not less than sixty (60) days prior written notice of such action.
Except as provided in Section 5 hereof, in the event of termination without
cause, Employer shall continue the payment of Executive's Base Salary and all
benefits provided for herein for a period of six (6) months following date of
termination.
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<PAGE> 15
6.2 TERMINATION BY EXECUTIVE.
6.2.1 Executive may terminate Executive's employment hereunder
for "cause" only in accordance with the provisions of this Section 6.2.1, or
"without cause" only in accordance with the provisions of Section 6.2.2
hereinbelow. For purposes of this Agreement, the term "cause" shall mean a
material breach of this Agreement by Employer which breach has not been cured
within thirty (30) days after a written demand for such performance is delivered
to Employer by Executive that specifically identifies the manner in which
Executive believes that Employer has breached this Agreement. In the event of
such termination, Employer will continue the payment of the Base Salary and all
benefits provided for in Section 3 hereof until the expiration of one (1) year
from the date of termination.
6.2.2 Executive may terminate Executive's employment hereunder
without cause at any time following the expiration of eighteen (18) months from
the Effective Date and only upon giving not less than three (3) months prior
written notice to Employer. In the event of such termination, Employer will
continue the payment of the Executive's Base Salary and all benefits provided
for in Section 3 hereof through the date of termination.
7. ARBITRATION.
In the event of any disagreement or controversy between Executive and
Employer arises out of or in connection with this Agreement, including without
limitation, the performance of the Parties hereunder, the same shall be
submitted to arbitration in accordance with the rules of the American
Arbitration Association and the Parties hereto agree that a decision of the
arbitrator shall be binding on the Parties hereto and each Party hereto agrees
to comply with any such decision; provided, that, Employer shall be entitled to
seek injunctive or equitable relief in any court of competent jurisdiction for a
breach or alleged breach by Executive of any provision contained in Sections 9
or 10 of this Agreement.
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<PAGE> 16
8. PLACE OF PERFORMANCE.
It is contemplated that Executive will perform a majority of Executive's
principal duties at Employer's principal place of business located at 915
Riverview Drive, Johnson City, Tennessee 37601 or at such other location as
Employer may decide.
9. NON-DISCLOSURE
Executive understands that certain information regarding Employer's
business may be disclosed to Executive during the course of Executive's
association with Employer. Such information may include, but is not limited to
client and potential client names, addresses, telephone numbers and project
information; mailing labels; project report forms; actual or potential bidding
data for current or potential projects; information regarding pending projects
or proposals; methods of quotation, production or engineering, including quality
control and project management; business plans and projections; new product,
facility and expansion plans; pricing information, including price lists,
quotation guides, previous or outstanding quotations, equipment prices and
billing information; estimating programs and methodology; techniques used in,
approaches or results of any market research; advertising sources; employee
salaries, contract, project and wage information; financial information
regarding Employer and its business; customer information reports; and marketing
plans and programs; whether written, verbal or contained on computer hardware or
software, diskette, tape microfiche or other media ("Information"). This
Information is of substantial value and highly confidential, is not known to the
general public, is the subject of reasonable efforts to maintain its secrecy,
constitutes the professional and trade secrets of Employer and is being provided
and disclosed to Executive solely for use in connection with Executives
employment with Employer.
In consideration of such employment and receipt of Information,
Executive agrees that Executive: (i) will regard and preserve the Information as
highly confidential and as the trade secrets of Employer; (ii) will not
disclose, nor permit to be disclosed, any of the Information to any person or
entity, absent consent and approval from Employer; (iii) will not make any use
of
13
<PAGE> 17
the Information for Executive's own benefit or for the benefit of any person or
entity other than Employer; (iv) will return all of the Information, including
but not limited to formulations, customer lists, books maintained by Employee,
source lists, to Employer within twenty-four (24) hours after request for same;
and (v) will comply with all of the provisions contained in this Section 9
during the Term of this Agreement and at all times following the termination of
this Agreement.
10. NON-COMPETITION AND NON-SOLICITATION
Executive agrees and represents to Employer that for so long as
Executive is an employee or director of Employer and for a period of one (1)
year thereafter, Executive will not, as principal, employer, stockholder,
co-partner, employee or in any other individual or representative capacity
whatsoever, enter into or engage, directly or indirectly, anywhere within the
World, in any business which is in any way directly competitive with the
business of Employer, and Executive will not acquire or own or become a partner,
employer, stockholder, officer or director of any company engaged in the
business of engineering, management or construction of curtain wall projects;
provided, however, that the preceding provision shall not be construed to
prevent Executive from owning less than five percent (5%) of the equity of any
public entity engaged in the curtain wall industry, whether or not such entity
is engaged in a business in competition with the business conducted by Employer.
Executive further agrees that during Executive's association with
Employer and for a period of one (1) year thereafter, Executive will not
directly or indirectly, solicit, communicate with or otherwise contact any of
Employer's customers or potential customers for the purpose of conducting any
engineering, management or construction of curtain wall business which business
is not the Employer's business. Executive agrees that Executive will not
directly or indirectly, employ, solicit for employment or advise or recommend to
any other person that they employ or solicit for employment, any person employed
by Employer during the Term of this Agreement or at any time following the
termination of this Agreement.
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11. ASSIGNMENT OF WORK PRODUCT
Executive agrees that the fruits of Executive's labor and efforts as an
employee of Employer shall belong solely to Employer and Executive shall have no
proprietary or other rights relating to such work product.
12. GENERAL PROVISIONS.
12.1 GOVERNING LAW AND JURISDICTION.
This Agreement shall be governed by and interpreted in accordance with
the laws of the State of Tennessee.
12.2 NOTICES.
All notices and other communications provided for or permitted hereunder
shall be made by hand delivery, first class mail, telex or telecopier, addressed
as follows:
PARTY ADDRESS
Employer: Flour City Architectural Metals, Inc.
915 Riverview Drive
Johnson City, TN 37601
Executive: Michael Russo
4306 Summerfield Dr.
Piney Flats, TN 37686
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; five (5) business days
after deposit in any United States Post Office in the Continental United States,
postage prepaid if mailed or if sent via professional carrier service provided
all fees are prepaid; when answered back, if telexed; and when receipt is
acknowledged or confirmed, if telecopied.
12.3 ATTORNEYS' FEES.
In the event a dispute arises with respect to this Agreement, the party
prevailing in such dispute shall be entitled to recover all expenses, including,
without limitation, reasonable
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attorneys' fees and expenses incurred in ascertaining such party's rights and
in preparing to enforce or in enforcing such party's rights under this
Agreement.
12.4 COMPLETE AGREEMENT.
This Agreement supersedes any and all other agreements, either oral or
in writing, between the Parties with respect to the subject matter hereof and
contains all of the covenants and agreements between the Parties with respect to
such subject matter in any manner whatsoever. Each Party to this Agreement
acknowledges that no representations, inducements, promises or agreements, oral
or otherwise, have been made by any Party, or anyone herein, and that no other
agreement, statement or promise not contained in this Agreement shall be valid
or binding. This Agreement may be changed or amended only by an amendment in
writing signed by all of the Parties or their respective successors-in-interest.
12.5 BINDING.
The Agreement shall be binding upon and inure to the benefit of the
successors-in-interest, assigns and personal representatives of the respective
Parties. If Executive should die while any amount would still be payable to
Executive hereunder if Executive had continued to live, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the terms of this
Agreement to Executive's devisee, legatee or other designee.
12.6 AUTHORITY.
Each of the Parties hereby represents and warrants to the other that:
(a) he/she/it has the power and authority to enter into this Agreement, and (b)
the execution, delivery and performance of this Agreement do not and will not
violate the terms of any agreement or other instrument to which he/she/it is a
party or by which he/she/it is bound. Employer further represents and warrants
to Executive that this Agreement has been duly authorized by all necessary
corporate action and has been duly and validly executed and delivered by
Employer and constitutes the valid and binding obligation of Employer,
enforceable against Employer in accordance with its terms.
16
<PAGE> 20
12.7 NUMBER AND GENDER
Whenever the singular number is used in this Agreement and when required
by the context, the same shall include the plural, and the masculine gender
shall include the feminine and neuter genders and the word "person" shall
include corporation, firm, partnership or other form of association.
12.8 FAILURE TO OBJECT NOT A WAIVER.
The failure of either Party to this Agreement to object to or to take
affirmative action with respect to any conduct of the other which is in
violation of the terms of this Agreement, shall not be construed as a waiver or
continuing waiver of the violation or breach or of any future violation, breach
or wrongful conduct.
12.9 UNENFORCEABLE TERMS.
Any provision hereof prohibited by law or unenforceable under the law of
any jurisdiction in which such provision is applicable shall as to such
jurisdiction only be ineffective without affecting any other provision of this
Agreement. To the full extent, however, that such applicable law may be waived
to the end that this Agreement be deemed to be a valid and binding agreement
enforceable in accordance with its terms, the Parties hereto hereby waive such
applicable law knowingly and understanding the effect of such waiver.
12.10 EXECUTION IN COUNTERPARTS.
This Agreement may be executed in several counterparts and when so
executed shall constitute one agreement binding on all the Parties,
notwithstanding that all the Parties are not signatory to the original and same
counterpart.
12.11 FURTHER ASSURANCE.
From time to time each Party will execute and deliver such further
instruments and will take such other action as any other Party may reasonably
request in order to discharge and perform their obligations and agreements
hereunder and to give effect to the intentions expressed in this Agreement.
17
<PAGE> 21
12.12 CROSS-REFERENCES.
All cross-references in this Agreement, unless specifically directed to
another agreement or document, refer to provisions in this Agreement, and shall
not be deemed to be referenced to the overall transaction or to any other
agreements or documents.
12.13 MISCELLANEOUS PROVISIONS.
The various headings and numbers herein and the grouping of provisions
of this Agreement into separate Sections and paragraphs are for the purpose of
convenience only and shall not be considered a part hereof. The language in all
parts of this Agreement shall in all cases be construed in accordance with its
fair meaning as if prepared by all Parties to the Agreement and not strictly for
or against any of the Parties.
(SIGNATURES ON FOLLOWING PAGE)
18
<PAGE> 22
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
day and year first above written.
"Employer"
Flour City Architectural Metals, Inc.,
a Delaware corporation
By: /s/ JOHN W. TANG
--------------------------------
Name: John W. Tang
-------------------------------
Title: Director
------------------------------
"Company"
Flour City International, Inc.,
a Nevada corporation
By: /s/ JOHN W. TANG
--------------------------------
Name: John W. Tang
-------------------------------
Title: Director
------------------------------
"Executive"
-----------------------------------
Michael J. Russo
19
<PAGE> 23
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
day and year first above written.
"Employer"
Flour City Architectural Metals, Inc.,
a Delaware corporation
By: /s/ JOHN W. TANG
--------------------------------
Name: John Tang
-------------------------------
Title:
------------------------------
"Company"
Flour City International, Inc.,
a Nevada corporation
By: /s/ JOHN W. TANG
--------------------------------
Name: John Tang
-------------------------------
Title:
------------------------------
"Executive"
/s/ MICHAEL J. RUSSO
-----------------------------------
Michael J. Russo
19
<PAGE> 1
EXHIBIT 10.7
EMPLOYMENT AGREEMENT
BY AND BETWEEN
FLOUR CITY ARCHITECTURAL METALS (ASIA) LTD.
AND
JOHN W.Y. TANG
<PAGE> 2
EMPLOYMENT AGREEMENT
I N D E X
<TABLE>
<S> <C>
1. EMPLOYMENT.....................................................................1
2. TITLES AND DUTIES..............................................................1
2.1 Initial Appointments.....................................................1
3. COMPENSATION...................................................................2
3.1 Base Salary..............................................................2
3.2 Benefits.................................................................2
4. DISABILITY OR DEATH............................................................3
5. TERMINATION....................................................................3
5.1 Termination by Employer..................................................3
5.2 Termination by Executive.................................................4
6. ARBITRATION....................................................................5
7. PLACE OF PERFORMANCE...........................................................5
8. NON-DISCLOSURE.................................................................5
9. NON-COMPETITION AND NON-SOLICITATION...........................................6
10. ASSIGNMENT OF WORK PRODUCT.....................................................7
11. GENERAL PROVISIONS.............................................................7
11.1 Governing Law and Jurisdiction...........................................7
11.2 Notices..................................................................7
11.3 Attorneys' Fees..........................................................8
11.4 Complete Agreement.......................................................8
11.5 Binding..................................................................9
11.6 Authority................................................................9
11.7 Number and Gender........................................................9
11.8 Failure to Object Not a Waiver...........................................9
11.9 Unenforceable Terms.....................................................10
11.10 Execution in Counterparts...............................................10
11.11 Further Assurance.......................................................10
11.12 CrossReferences.........................................................10
1.13 Miscellaneous Provisions................................................10
</TABLE>
i
<PAGE> 3
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement"), is made and entered on the 15th
day of December, 1997 (the "Execution Date"), by and between Flour City
International, Inc., a Nevada corporation ("Company"); Flour City Architectural
Metals (Asia) Ltd., a Hong Kong corporation ("Employer"); and John W.Y. Tang
("Executive"), (Employer and Executive are sometimes hereinafter referred to
collectively as the "Parties" and individually as a "Party").
RECITALS
A. Employer is a company engaged in the business of engineering,
management and construction of custom curtain wall projects; and
B. Executive has particular and peculiar knowledge and background in
performing executive level management services and related activities for a
business of this nature; and
C. The parties hereto desire to enter into an Agreement whereby the
Executive's services will be made available to Employer.
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter contained, the parties hereto agree as follows:
1. EMPLOYMENT
Employer shall employ Executive as its President for a term of five (5)
consecutive years (the "Term"), commencing on December 15, 1997 (the "Effective
Date"). The employment relationship created by this Agreement may only be
terminated prior to the expiration of the Term in accordance with the provisions
of Sections 4 and 5 hereof and in accordance with the terms and conditions
contained therein.
2. TITLES AND DUTIES.
2.1 INITIAL APPOINTMENTS.
Subject at all times to the supervision and direction of Employer's
Board of Directors, Executive shall be employed as the President of Employer to
perform such executive and other duties relating to the business and operations
of Employer and any present or future subsidiaries or
<PAGE> 4
affiliates thereof as are delegated or assigned to the Executive from time to
time by such Board of Directors and are consistent with the position of
President. Executive shall faithfully and diligently perform all duties and will
promote and advance the business and affairs of Employer.
3. COMPENSATION.
3.1 BASE SALARY.
3.1.1 Executive will be paid an annual base salary of $160,000
("Base Salary") commencing as of the Effective Date. The Base Salary shall be
payable in equal bi-weekly installments.
3.1.2 Executive's Base Salary shall be evaluated on an annual
basis by the Board of Directors. Executive's Base Salary may be increased in the
sole discretion of the Board of Directors, but never decreased during the Term,
without the consent of Executive.
3.2 BENEFITS.
In addition to the Base Salary, Executive shall receive the following
benefits:
3.2.1 During the period for which Executive is employed by
Employer, Employer shall purchase medical health insurance for Executive (which
health insurance shall also cover Executive's spouse and certain children) of
the type and in such amounts as is available from time to time to all other
executives of Employer;
3.2.2 During the period for which Executive is employed by
Employer, Executive shall be entitled to (a) a vacation period each year of
fifteen (15) business days and (b) additional holidays customarily observed by
Employer, and during such time, Executive's compensation shall be paid in full;
provided, however, that if Executive does not take all or a portion of the
vacation time to which Executive is entitled hereunder, Employer shall
compensate Executive therefor on such terms as Employer and Executive may
mutually agree;
3.2.3 During the period for which Executive is employed by
Employer, and within five (5) business days of the submission of the appropriate
documentation by Executive, Executive
2
<PAGE> 5
shall be reimbursed by Employer for all ordinary and necessary business expenses
reasonably incurred by Executive in the performance of Executive's duties,
provided that:
3.2.3.1 Each such expenditure is of a nature qualifying it
as a proper business expense of Employer; and
3.2.3.2 Executive furnishes to Employer adequate records
and other documentation as may be reasonably required by Employer for the
substantiation of such expenditures as a business expense of Employer.
4. DISABILITY OR DEATH.
Employer shall have the right to terminate this Agreement in the event
of Executive's death or if Executive becomes permanently disabled. In the event
of Executive's permanent disability, Employer shall continue to pay the Base
Salary that would have otherwise been earned by Executive for a period of six
(6) months from the date of certification by an attending physician; provided,
however, that Employer's obligation hereunder shall be reduced to the extent of
any disability insurance payments received by Executive. In the event of the
death of Executive, Executive's estate will receive the Base Salary that would
have otherwise been earned by Executive for a period of twelve (12) months. For
purposes of this Agreement, the phrase "permanently disabled" shall mean the
inability of Executive to perform Executive's duties hereunder for a continuous
period of more than three (3) consecutive months during any twelve (12) month
period. Such permanent disability shall be determined by Executive's attending
physician.
5. TERMINATION.
5.1 TERMINATION BY EMPLOYER.
5.1.1 Except as expressly provided herein Employer may terminate
Executive's employment hereunder for "cause" only in accordance with the
provisions of this Section 5.1.1, or "without cause" only in accordance with the
provisions of Section 5.1.2 hereinbelow. For purposes of this Agreement, the
term "cause" shall mean a material breach of this Agreement by Executive
3
<PAGE> 6
or the willful and continued failure by Executive to substantially perform
Executive's duties hereunder. In the event termination is for cause, Employer is
not required to give advance notice to Executive. Employer will continue the
payment of Base Salary and all benefits provided for herein for a ten (10) day
period following notice of termination
5.1.2 Employer may terminate Executive's employment without cause
only in the event that Employer incurs a "net loss" for two (2) consecutive
quarters in excess of $250,000 per quarter; or absent such losses, only upon the
approval of a majority of Company's Board of Directors. In the event Executive's
employment is terminated without cause Executive shall receive not less than
sixty (60) days prior written notice of such action. Except as provided in
Section 4 hereof, in the event of termination without cause, Employer shall
continue the payment of Executive's Base Salary and all benefits provided for
herein for a period of six (6) months following date of termination.
5.2 TERMINATION BY EXECUTIVE.
5.2.1 Executive may terminate Executive's employment hereunder
for "cause" only in accordance with the provisions of this Section 5.2.1, or
"without cause" only in accordance with the provisions of Section 5.2.2
hereinbelow. For purposes of this Agreement, the term "cause" shall mean a
material breach of this Agreement by Employer which breach has not been cured
within thirty (30) days after a written demand for such performance is delivered
to Employer by Executive that specifically identifies the manner in which
Executive believes that Employer has breached this Agreement. In the event of
such termination, Employer will continue the payment of the Base Salary and all
benefits provided for in Section 3 hereof until the expiration of one (1) year
from the date of termination.
5.2.2 Executive may terminate Executive's employment hereunder
without cause at any time following the expiration of eighteen (18) months from
the Effective Date and only upon giving not less than three (3) months prior
written notice to Employer. In the event of such
4
<PAGE> 7
termination, Employer will continue the payment of the Executive's Base Salary
and all benefits provided for in Section 3 hereof through the date of
termination.
6. ARBITRATION.
In the event of any disagreement or controversy between Executive and
Employer arises out of or in connection with this Agreement, including without
limitation, the performance of the Parties hereunder, the same shall be
submitted to arbitration in accordance with the rules of the American
Arbitration Association and the Parties hereto agree that a decision of the
arbitrator shall be binding on the Parties hereto and each Party hereto agrees
to comply with any such decision; provided, that, Employer shall be entitled to
seek injunctive or equitable relief in any court of competent jurisdiction for a
breach or alleged breach by Executive of any provision contained in Sections 8
or 9 of this Agreement.
7. PLACE OF PERFORMANCE.
It is contemplated that Executive will perform a majority of Executive's
principal duties at Employer's principal place of business located at 610 Nathan
Road, Suite 1301, Hong Kong or at such other location as Employer may decide.
8. NON-DISCLOSURE
Executive understands that certain information regarding Employer's
business may be disclosed to Executive during the course of Executive's
association with Employer. Such information may include, but is not limited to
client and potential client names, addresses, telephone numbers and project
information; mailing labels; project report forms; actual or potential bidding
data for current or potential projects; information regarding pending projects
or proposals; methods of quotation, production or engineering, including quality
control and project management; business plans and projections; new product,
facility and expansion plans; pricing information, including price lists,
quotation guides, previous or outstanding quotations, equipment prices and
billing information; estimating programs and methodology; techniques used in,
approaches or results of any market
5
<PAGE> 8
research; advertising sources; employee salaries, contract, project and wage
information; financial information regarding Employer and its business; customer
information reports; and marketing plans and programs; whether written, verbal
or contained on computer hardware or software, diskette, tape microfiche or
other media ("Information"). This Information is of substantial value and highly
confidential, is not known to the general public, is the subject of reasonable
efforts to maintain its secrecy, constitutes the professional and trade secrets
of Employer and is being provided and disclosed to Executive solely for use in
connection with Executives employment with Employer.
In consideration of such employment and receipt of Information,
Executive agrees that Executive: (i) will regard and preserve the Information as
highly confidential and as the trade secrets of Employer; (ii) will not
disclose, nor permit to be disclosed, any of the Information to any person or
entity, absent consent and approval from Employer; (iii) will not make any use
of the Information for Executive's own benefit or for the benefit of any person
or entity other than Employer; (iv) will return all of the Information,
including but not limited to formulations, customer lists, books maintained by
Employee, source lists, to Employer within twenty-four (24) hours after request
for same; and (v) will comply with all of the provisions contained in this
Section 8 during the Term of this Agreement and at all times following the
termination of this Agreement.
9. NON-COMPETITION AND NON-SOLICITATION
Executive agrees and represents to Employer that for so long as
Executive is an employee or director of Employer and for a period of one (1)
year thereafter, Executive will not, as principal, employer, stockholder,
co-partner, employee or in any other individual or representative capacity
whatsoever, enter into or engage, directly or indirectly, anywhere within the
World, in any business which is in any way directly competitive with the
business of Employer, and Executive will not acquire or own or become a partner,
employer, stockholder, officer or director of any company engaged in the
business of engineering, management or construction of curtain wall projects;
provided, however, that the preceding provision shall not be construed to
prevent Executive from
6
<PAGE> 9
owning less than five percent (5%) of the equity of any public entity engaged in
the curtain wall industry, whether or not such entity is engaged in a business
in competition with the business conducted by Employer.
Executive further agrees that during Executive's association with
Employer and for a period of one (1) year thereafter, Executive will not
directly or indirectly, solicit, communicate with or otherwise contact any of
Employer's customers or potential customers for the purpose of conducting any
engineering, management or construction of curtain wall business which business
is not the Employer's business. Executive agrees that Executive will not
directly or indirectly, employ, solicit for employment or advise or recommend to
any other person that they employ or solicit for employment, any person employed
by Employer during the Term of this Agreement or at any time following the
termination of this Agreement.
10. ASSIGNMENT OF WORK PRODUCT
Executive agrees that the fruits of Executive's labor and efforts as an
employee of Employer shall belong solely to Employer and Executive shall have no
proprietary or other rights relating to such work product.
11. GENERAL PROVISIONS.
11.1 GOVERNING LAW AND JURISDICTION.
This Agreement shall be governed by and interpreted in accordance with
the laws of the State of Nevada.
11.2 NOTICES.
All notices and other communications provided for or permitted hereunder
shall be made by hand delivery, first class mail, telex or telecopier, addressed
as follows:
7
<PAGE> 10
PARTY ADDRESS
Employer: Flour City Architectural Metals (Asia), Ltd..
610 Nathan Road, Suite 1301
Hong Kong
Executive: John W.Y. Tang
610 Nathan Road, Suite 1301
Hong Kong
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; five (5) business days
after deposit in any United States Post Office in the Continental United States,
postage prepaid if mailed or if sent via professional carrier service provided
all fees are prepaid; when answered back, if telexed; and when receipt is
acknowledged or confirmed, if telecopied.
11.3 ATTORNEYS' FEES.
In the event a dispute arises with respect to this Agreement, the party
prevailing in such dispute shall be entitled to recover all expenses, including,
without limitation, reasonable attorneys' fees and expenses incurred in
ascertaining such party's rights and in preparing to enforce or in enforcing
such party's rights under this Agreement.
11.4 COMPLETE AGREEMENT.
This Agreement supersedes any and all other agreements, either oral or
in writing, between the Parties with respect to the subject matter hereof and
contains all of the covenants and agreements between the Parties with respect to
such subject matter in any manner whatsoever. Each Party to this Agreement
acknowledges that no representations, inducements, promises or agreements, oral
or otherwise, have been made by any Party, or anyone herein, and that no other
agreement, statement or promise not contained in this Agreement shall be valid
or binding. This Agreement may be changed or amended only by an amendment in
writing signed by all of the Parties or their respective successors-in-interest.
8
<PAGE> 11
11.5 BINDING.
The Agreement shall be binding upon and inure to the benefit of the
successors-in-interest, assigns and personal representatives of the respective
Parties. If Executive should die while any amount would still be payable to
Executive hereunder if Executive had continued to live, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the terms of this
Agreement to Executive's devisee, legatee or other designee.
11.6 AUTHORITY.
Each of the Parties hereby represents and warrants to the other that:
(a) he/she/it has the power and authority to enter into this Agreement, and (b)
the execution, delivery and performance of this Agreement do not and will not
violate the terms of any agreement or other instrument to which he/she/it is a
party or by which he/she/it is bound. Employer further represents and warrants
to Executive that this Agreement has been duly authorized by all necessary
corporate action and has been duly and validly executed and delivered by
Employer and constitutes the valid and binding obligation of Employer,
enforceable against Employer in accordance with its terms.
11.7 NUMBER AND GENDER
Whenever the singular number is used in this Agreement and when required
by the context, the same shall include the plural, and the masculine gender
shall include the feminine and neuter genders and the word "person" shall
include corporation, firm, partnership or other form of association.
11.8 FAILURE TO OBJECT NOT A WAIVER.
The failure of either Party to this Agreement to object to or to take
affirmative action with respect to any conduct of the other which is in
violation of the terms of this Agreement, shall not be construed as a waiver or
continuing waiver of the violation or breach or of any future violation, breach
or wrongful conduct.
9
<PAGE> 12
11.9 UNENFORCEABLE TERMS.
Any provision hereof prohibited by law or unenforceable under the law of
any jurisdiction in which such provision is applicable shall as to such
jurisdiction only be ineffective without affecting any other provision of this
Agreement. To the full extent, however, that such applicable law may be waived
to the end that this Agreement be deemed to be a valid and binding agreement
enforceable in accordance with its terms, the Parties hereto hereby waive such
applicable law knowingly and understanding the effect of such waiver.
11.10 EXECUTION IN COUNTERPARTS.
This Agreement may be executed in several counterparts and when so
executed shall constitute one agreement binding on all the Parties,
notwithstanding that all the Parties are not signatory to the original and same
counterpart.
11.11 FURTHER ASSURANCE.
From time to time each Party will execute and deliver such further
instruments and will take such other action as any other Party may reasonably
request in order to discharge and perform their obligations and agreements
hereunder and to give effect to the intentions expressed in this Agreement.
11.12 CROSS-REFERENCES.
All cross-references in this Agreement, unless specifically directed to
another agreement or document, refer to provisions in this Agreement, and shall
not be deemed to be referenced to the overall transaction or to any other
agreements or documents.
11.13 MISCELLANEOUS PROVISIONS.
The various headings and numbers herein and the grouping of provisions
of this Agreement into separate Sections and paragraphs are for the purpose of
convenience only and shall not be considered a part hereof. The language in all
parts of this Agreement shall in all cases be construed
10
<PAGE> 13
in accordance with its fair meaning as if prepared by all Parties to the
Agreement and not strictly for or against any of the Parties.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
day and year first above written.
"Employer"
Flour City Architectural Metals (Asia) Ltd.,
a Hong Kong corporation
By: ________________________
Name: ________________________
Title: ________________________
"Company"
Flour City International, Inc.,
a Nevada corporation
By: ________________________
Name: ________________________
Title: ________________________
"Executive"
_______________________________
John W.Y. Tang
11
<PAGE> 1
Page 1 of 2
EXHIBIT 10.8
Mr. Robert F. Wright
Mrs. Linda D. Wright
686 Industrial Park Road
Piney Flats, TN 37686
May 27, 1997
Mr. Michael J. Russo, President
Flour City Architectural Metals, Inc.
915 Riverview Drive, Suite 1
Johnson City, Tennessee 37601
Subject: Ground and Building Lease (9 pages) Dated December 20, 1993, Between
Robert F. Wright and Linda D. Wright and Ben M. Frizzell, Jr. for Property in
Tri County Industrial Park
Dear Mr. Russo:
This letter constitutes an agreement between Robert F. Wright and Linda D.
Wright (Wrights) and Flour City Architectural Metals, Inc. (FCAM) to assume
subject Lease (copy attached) and all the responsibilities and rights of the
Lease including all terms and conditions of the Lease except for the following:
1. The term of this agreement between Wrights and FCAM is for a period of
one (1) year beginning June 1, 1997, and ending on May 30, 1998.
2. FCAM may renew this lease under the same terms for an additional term in
increments of six (6) months or as mutually agreed, ending upon the
expiration of subject Lease, by giving ninety (90) days written notice
prior to the end of the term.
3. The GTE option noted in paragraph 2.2 is null and void.
4. Rent shall be paid directly by FCAM to Lessor as set out in the Lease.
Annual (or prorated portion thereof) property taxes ($6,370.94) shall be
paid by FCAM directly to the county with no advance escrow.
5. Wrights grant permission for FCAM to negotiate directly with the Lessor
concerning expansion of the Premises, an extended term, and related
matters. If your negotiations are concluded, Wrights are agreeable to
terminate this agreement and the referenced Lease with the Lessor.
6. The replacement value for fire and extended coverage insurance shall be
$1,000,000.00 and this amount shall be the limit of FCAM's exposure in
case of destruction of premises. FCAM shall not be bound to the terms
noted in the last sentence of paragraphs 7.1 and 7.3.
7. Wrights and Lessor agree to allow FCAM to utilize the property outside
the chain link fence for storage of equipment and/or materials.
<PAGE> 2
Page 2 of 2
8. Concerning paragraph 12.1, revise the following: add the phrase "notice
of" prior to the word "failure" in the second line; and revise the
second sentence as follows "Notices will be required from the Lessor to
the Lessee."
9. Wrights shall at their expense repair, replace and/or install materials
and workmanship as follows prior to commencement of lease:
o Repair roof leaks that may exist.
o Replace damaged/stained ceiling tiles in office.
o Patch and paint drywall in office to achieve uniform finished
appearance.
o Replace driveway paving and patch or overlay parking areas to good
condition. Driveway work to be completed by June 5, 1997, and parking
area work to be completed by June 15, 1997, all weather permitting.
Driveway will be passable during construction.
o Ensure the following is in full working order (including light bulbs
and similar) for plant and office areas: all electrical systems;
lighting; security systems; emergency lighting system; intercom
system; sprinkler & fire alarm system; overhead crane; HVAC; plumbing
system; and ventilation fans.
o Concerning the locks of all doors, ensure all are in working order
and provide keys. FCAM may re-key at FCAM's option.
o The following items currently in the facility to remain during this
lease: fire extinguishers; air distribution lines; phone equipment
and system; office improvements and furnishings.
o Concerning the designated overhead water lines in the plant, remove
and dispose off-site.
The following parties agree to be bound by the terms of this letter and the
terms of subject lease except as modified by this letter.
/s/ ROBERT F. WRIGHT /s/ LINDA D. WRIGHT
- ---------------------------- ----------------------------
Robert F. Wright Linda D. Wright
FLOUR CITY ARCHITECTURAL METALS, INC.
/s/ MICHAEL J. RUSSO 5/20/97
- ---------------------------- -------
Michael J. Russo, President Date
- ----------------------------- -------
Ben M. Frizzell, Jr. Date
<PAGE> 3
Ben M. Frizzell, Jr.
P.O. Box 3292
Bristol, Tennessee 37625
May 15, 1997
Mr. Robert F. Wright
Mrs. Linda D. Wright
686 Industrial Park Road
Piney Flats, TN 37686
Subject: Ground And Building Lease Date December 20, 1993, For Property in Tri
County Industrial Park
Dear Bud and Linda:
This letter constitutes my consent for you to sub-lease the subject Premises to
Flour City Architectural Metals, Inc.
All terms and conditions of the lease remain in effect, and you remain
primarily responsible for the Lessee's performance.
If you have any further comments, please call me.
Very truly yours,
/s/ Ben Frizzell, Jr.
- -----------------------------
Ben Frizzell, Jr.
<PAGE> 4
GROUND AND BUILDING LEASE
Lessor: Ben M. Frizzell, Jr.
Lessee: Robert F. Wright
INDEX
<TABLE>
<CAPTION>
Subject Article Page
------- ------- ----
<S> <C> <C>
Access to Premises XX 7
Additions to the Premises XXI 7
Applicable Law XVII 7
Assignment and Subletting VIII 4
Chattels and Fixtures XI 4
Covenant of Lessee XVIII 7
Covenants of Lessor XIV 6
Default XII 4
Destruction of Premises VII 3
Eminent Domain XIII 6
Insurance VI 2
Mortgages X 4
Notices XVI 6
Option to Renew XIX 7
Premises I 1
Rent III 1
Repairs IX 4
Taxes and Assessments IV 2
Term II 1
Termination of Lease XV 6
Utilities V 2
</TABLE>
<PAGE> 5
GROUND AND BUILDING LEASE
LEASE, made December 20, 1993, between Ben M. Frizzell, Jr. as "Lessor"
and Robert F. Wright, dba Volunteer Warehouse and Robert F. Wright and Linda D.
Wright, individually, as "Lessee" by which the parties agree as follows:
ARTICLE I
PREMISES
1.1 The Lessor leases to Lessee and Lessee rents from Lessor a portion
of premises located in Tri-County Industrial Park, Piney Flats, Tennessee and
described in "Exhibit A", attached hereto and made part hereof.
1.2 "Exhibit B" attached hereto and made a part hereof, is a plat of
Tri-County Industrial Park on which the Premises are outlined in red.
ARTICLE II
TERM
2.1 The Lease term shall commence on November 15, 1994. The Lease term
shall end sixty (60) months from such date.
2.2 This lease is void if GTE exercises its option to purchase the
premises as provided for in its existing lease with Lessor. Otherwise, this
lease is in full force and effect.
ARTICLE III
RENT
3.1 The Lessee agrees to pay to the Lessor as rent during the original
term of this Lease, 60 monthly installments, due on the fifteenth day of each
month, the sum of $8,610.00, totaling $510,600.00 for the term.
3.2 The rental during the term of this Lease shall be on a net-net-net
basis. The Lessee, and not the Lessor, shall pay all costs connected with the
use and occupancy of the Premises including, but not limited to: real estate
taxes (or any other tax or charge imposed by any governmental authority
expressly designated as a substitute for such taxes, but subject to the
provisions of paragraph 6.1 hereof), personal property taxes, any installments
of special assessments which become due and payable during the term of this
Lease or any exercised renewals thereof, utilities, service charges,
maintenance, and insurance, subject to the provisions of Article IX hereof.
The term "rent" as used elsewhere in the Lease shall include all payments and
charges described in Paragraphs 3.1 and 3.2.
3.3 Rent shall be paid to Lessor at the address shown herein or at such
other place as Lessor may designate in writing.
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ARTICLE IV
TAXES AND ASSESSMENTS
4.1(a) Lessee covenants and agrees to pay and discharge before
delinquency thereof and before penalties shall accrue thereon, all taxes and
assessments on the Premises due and payable during the term of this Lease and
renewals hereof. If required by Lessor's permanent lender, Lessee agrees to
deposit each month in advance with the lender(s) in escrow, one/twelfth (1/12)
of such taxes and assessments pursuant to the terms of the mortgage(s).
4.2 Notwithstanding the foregoing provisions, Lessee may in good faith
and in the name of Lessor where appropriate, contest the validity of any tax by
appropriate action or legal proceeding, but no such contest shall relieve
Lessee of its obligation to pay such tax or taxes before the same shall become
delinquent unless the proceeding to contest such tax shall operate to prevent
sale of the premises, any part thereof or any property thereon. Lessee shall
indemnify and save Lessor harmless against any and all loss, cost or expense of
any kind that may be imposed upon Lessor as a result of such proceeding or in
connection therewith.
ARTICLE V
UTILITIES
5.1 Lessee shall pay or cause to by paid all charges for water, gas,
sewer, electricity, light, heat, power, telephone or other service used,
rendered or supplied to or in connection with the Premises during the term of
this Lease.
ARTICLE VI
INSURANCE
6.1 During the term of this Lease, Lessee shall maintain general
liability insurance for the benefit of Lessor, Lessor's permanent lender, and
Lessee, as their respective interests may appear, in an amount not less than
Two Million Dollars ($2,000,000.00) combined single limit for bodily injury
and/or property damage arising out of any one accident or occurrence. Lessee
shall provide Lessor with written evidence of such coverage annually. All
policies shall contain a provision for thirty (30) day notice to Lessor of
cancellation of any policy.
6.2 Lessee shall also maintain during the term of this Lease fire and
extended coverage insurance insuring the improvements to the Premises in an
amount equal to one hundred (100%) percent of the agreed upon replacement value
of the improvements. ($1,000,000.00 is the agreed replacement value at the
beginning of the term of this lease. Said value shall be adjusted yearly per
the BLS consumer price index plus the cost of capital expenditures for
additions to the leased premises.) Such fire and extended coverage insurance
policies shall be in the names of the Lessor, Lessor's permanent lender, and
Lessee as their respective interests may appear. Lessee shall provide Lessor
and Lessor's mortgagee(s) with written evidence of such insurance.
6.3 The Lessee will indemnify and save harmless the Lessor against and
from all liabilities, obligations, damages, causes of action, claims or
judgments which may be imposed upon or incurred by or asserted against
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the Lessor by reason of any of the following matters occurring after occupancy
under this Lease, unless any of the following shall have resulted from the
negligence or willful misconduct of Lessor or Lessor's agents: (a) any work or
activity on or about the Premises; (b) any use, non-use, possession,
maintenance and management of the Premises or any part thereof; (c) any
negligence or intentional misconduct on the part of Lessee, or any of its
agents, contractors, servants, employees, licensees, or invitees; (d) any
accident, injury or damage to any person or property occurring on or about the
Premises or any part thereof; (e) any failure on the part of the Lessee to
perform or comply with any of the covenants, agreements, terms or conditions of
this Lease.
ARTICLE VII
DESTRUCTION OF PREMISES
7.1 If the Premises shall be partially destroyed by fire or other
casualty covered by Lessee's policy of fire and extended coverage insurance,
then Lessor shall promptly and with due diligence replace or repair the
Premises conforming to the specifications of the Building partially destroyed,
the same to be done as soon as possible after issuance of required permits.
Lessor shall use its best efforts to complete such repair or replacement in a
timely manner. In the event the insurance proceeds are not sufficient to pay
the costs of such work Lessee agrees to promptly pay any additional sums
necessary.
7.2 In the event of total destruction of the Premises as above
mentioned, or such partial destruction whereby Lessee cannot reasonably
operate, Lessee's rent shall completely abate from the date of such destruction
until possession of the rebuilt premises is delivered to the Lessee. In the
event of any other partial destruction or damage whereby Lessee shall be
deprived of the occupancy of only a portion of the Premises, then the rent
shall be reduced and apportioned according to the area of the Premises which is
unusable by Lessee until such time as the Premises shall be repaired or
restored. Provided, however, that if more than seventy-five (75%) percent of
the Premises are destroyed this Lease may be terminated by either party on
thirty (30) days written notice to the other.
7.3 For the purpose of paying towards the cost of such repairs,
replacements or rebuilding, Lessor, its mortgagee(s), and Lessee shall make
available all net sums received under insurance policies covering such loss, in
reimbursements for work and materials actually incorporated in the Premises. If
this Lease is terminated as provided in Paragraph 9.2 all insurance proceeds
shall be paid to Lessor. If such proceeds are not sufficient to pay the full
cost of repair or restoration, Lessee shall pay the deficiency.
7.4 In the event the Lessor and Lessee cannot agree as to the
application of the foregoing provisions, each shall immediately appoint an
arbitrator. The arbitrators shall jointly appoint one additional arbitrator
within seven (7) days, and the three shall constitute an arbitration panel to
determine the application of said provisions. Their decision shall be final and
conclusive on the parties. Costs of arbitration shall be divided equally
between Lessor and Lessee.
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ARTICLE VIII
ASSIGNMENT AND SUBLETTING
8.1 Lessee may elect to sublease the premises or assign its rights
under this Lease in whole or in part to a wholly owned subsidiary or affiliate
of Lessee, subject to approval by Lessor. In the event of any sublease or
assignment to a subsidiary of Lessee, Lessee shall remain liable for the
performance of all obligations contained in this Lease.
ARTICLE IX
REPAIRS
9.1 Lessee agrees to accept premises "as is" and to make all necessary
repairs and then to keep the Premises and all improvements in essentially the
same condition as of the date it takes possession. Rehabilitation to this
essentially same conditions will be the responsibility of the Lessee at the
termination of this lease, or any extensions. Major reroofing will be shared by
Lessee and Lessor on a pro rata basis assuming a 15 year life.
9.2 Lessee further covenants to operate and keep the Premises in a
clean and sanitary condition according to all applicable laws and codes.
ARTICLE X
MORTGAGES
10.1 Lessee agrees to execute any instrument necessary to evidence
subordination of this Lease to any mortgage by Lessor, unless execution thereof
shall, in Lessee's opinion, create a right in Lessor or its mortgagee superior
to a right or rights existing under Federal law or the laws of the State of
Tennessee as of the date hereof.
ARTICLE XI
CHATTELS AND FIXTURES
11.1 Provided only if Lessee is not in default in rent payments or any
provision of this Lease, Lessor waives all claims to any chattels or equipment
affixed to the Premises by Lessee or its sublessee (See Article VIII) and
Lessee or its sublessee may remove the same at the expiration or termination of
this Lease or its renewals; provided, however, Lessee shall repair any damage
to Premises caused by the removal of such chattels or equipment.
ARTICLE XII
DEFAULT
12.1 Except as otherwise provided herein, if Lessee fails to fulfill
any provision of this Lease, then, 10 days after such notice of failure, the
Lessee shall be deemed to be in default under this Lease and shall have 10
additional days to cure said default, subject to the interest provision for
moneys owing. Notices will be required from the Lessor to the Lessee.
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In the event of default, Lessor, in addition to other legal or equitable
remedies it may have, may terminate the Lease, in which event Lessee shall
remain liable for all future rentals due hereunder for the then current term of
the Lease plus fees paid for collection efforts. Any moneys owing by either
party to the other will bear interest at 12% per annum from the date due until
paid.
12.2 If the notice provided for in 12.1 shall have been given and the
Lease terminated, then Lessor may, without further notice, re-enter the
Premises by force or otherwise and dispossess lessee by summary proceedings or
otherwise, and remove Lessee's personal property. Lessee hereby waives the
service of notice of intention to re-enter or to institute legal proceedings to
that end.
12.3 In case of any such default, re-entry, expiration or dispossession
by summary proceedings or otherwise, Lessor shall use his best efforts to
re-let the Premises or any part thereof, for a term or terms which may be less
than or exceed the period which would otherwise have constituted the balance of
the term of this Lease and which may be for less or more than the rent herein
provided for. Any surplus of monthly rentals (less the Lessor's costs of
re-leasing the premises and interim expenses of holding) over and above
Lessee's rental obligation shall be credited to Lessee's account for the
reminder of Lessee's rental obligations to Lessor. If any deficiency is not
paid for within thirty (30) days, Section 12.4 shall prevail and control. The
failure of Lessor to re-let the Premises or any part thereof shall not release
or affect Lessee's liability for damages; provided, however, notwithstanding
any other terms to the contrary, Lessor will use its best efforts to re-let to
mitigate Lessee's damages, costs and expenses, and to re-let on the same terms
and conditions as contained herein.
12.4 Subject to the provisions of this Article, if the rent shall not
be paid when due and the time for curing the deficiency shall have expired,
that part of the rent covenanted to be paid by the Lessee for the balance of
the then current term of this Lease which has not been paid to the Lessor,
shall immediately become due and payable at the election of the Lessor upon
written notice to the Lessee. If Lessee is declared bankrupt or voluntarily
offers to creditors terms of composition, or in case a receiver is appointed to
take charge of and conduct the affairs of the Lessee, such claim for unpaid
rent so due and payable under this Lease for the balance of the then current
term of this Lease shall be considered liquidated damages and shall constitute
a debt provable in bankruptcy or receivership.
12.5 In the event Lessor neglects to pay when due any obligations or
any mortgage or encumbrance affecting title to the demised premises and to
which this Lease is subordinate, or fails to perform any obligations specified
under this Lease, then Lessee, after continuance of any such failure or default
for twenty (20) days after notice in writing thereof by Lessee, may pay said
assessments, principal, interest or charges, or cure such default, all on
behalf of and at the expense of Lessor, and do all necessary work and make all
necessary payments in connection therewith, and Lessor agrees thereafter on
demand, to pay Lessee forthwith the amount so paid by Lessee together with
interest thereon at the rate of twelve (12%) percent per annum and agrees that
Lessee may withhold any and all rental payments and other payments thereafter
due to Lessor and apply same to the payments of such indebtedness, or,
alternatively, Lessee may cancel and terminate this Lease by written notice to
Lessor given within thirty (30) days following such twenty (20) day period.
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<PAGE> 10
12.6 If Lessee shall default in the observance of performance of any
term or covenant on Lessee's part to be observed in any article of this Lease,
Lessor may, immediately, or at any time thereafter and without notice, perform
the same for the account of Lessee, and Lessee will promptly reimburse Lessor
all monies expended upon presentation of a bill for same by Lessor to Lessee.
Any monies owing by either party to the other will bear interest at 12% per
annum from the date due until paid.
ARTICLE XIII
EMINENT DOMAIN
13.1 If the Premises shall be taken or condemned by any competent
authority for any public or quasi-public use or purpose, the term of this
Lease, at Lessee's option shall terminate and cease from the date when
possession shall be so taken.
ARTICLE XIV
COVENANTS OF LESSOR
14.1 Lessor covenants and warrants that Lessor has the lawful right and
authority to make this Lease; and that Lessee, upon paying the rent herein
reserved and performing and observing the covenants and conditions herein
contained on Lessee's part to by performed and observed, shall and will
peacefully and quietly have, hold and enjoy the Premises for the full term of
this Lease and any extensions thereof, except in the event of the taking of the
Premises by public or quasi-public authority as provided in Article XV above.
ARTICLE XV
TERMINATION OF LEASE
15.1 Upon any termination of this Lease, whether by lapse of time,
cancellation pursuant to an election provided herein, forfeiture or otherwise,
Lessee shall immediately surrender possession of the Premises to Lessor in good
and tenantable repair, subject however, to the provisions of Article IX hereof.
ARTICLE XVI
NOTICES
16.1 Any notice or consent required to be given by or on behalf of
either party upon the other shall be in writing and shall be given by mailing
such notice or consent by Registered or Certified Mail, return receipt
requested, addressed to the Lessor at P.O. Box 3292, Bristol, Tennessee 37625
or to the Lessee at 686 Industrial Park Road, Piney Flats, TN 37686, or at such
other address or addresses as may be specified from time to time, in writing,
delivered to the other party.
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ARTICLE XVII
APPLICABLE LAW
17.1 The laws of the State of Tennessee shall govern the validity,
performance and enforcement of this Lease. The invalidity or unenforceability
of any provision of this Lease will not affect or impair any other provision.
17.2 Wherever used, "Lessor" and "Lessee" shall be deemed to include
the heirs, personal representatives, successors, sublessees, and assigns of
said parties unless the context excludes such construction.
ARTICLE XVIII
COVENANT OF LESSEE
18.1 Lessee covenants that it will provide a recent (less than one year
old) Statement of Financial to Lessor prior to the beginning of the initial
term and at the beginning of any renewal term.
ARTICLE XIX
OPTION TO RENEW
19.1 Provided Lessee gives at least 90 days notice prior to the
expiration of the term of this lease, Lessor grants to Lessee the option to
renew this lease for one additional five year term under the same terms and
conditions except that the rental will be increased (but not decreased) at the
beginning of each year of the new term by the change in the Bureau of Labor
Statistics Consumer Price Index.
ARTICLE XX
ACCESS TO PREMISES
20.1 Lessee and Lessor agree that Lessor may utilize the property
belonging to the Lessor which lies outside the chain link fence for storage of
equipment and or materials and that Lessor may have ingress and egress to said
storage area via the asphalt driveways. Lessor agrees that he will see that
storage is done in an orderly and safe manner and will hold Lessee harmless
from any loss that Lessee may suffer as a result of said storage.
ARTICLE XXI
ADDITIONS TO THE PREMISES
21.1 Additions or modifications to the premises may be made only with
written consent of Lessor. Any such expansion or modifications shall be
constructed in accordance with all applicable requirements of the County of
Sullivan and other controlling authorities, and the contractor, architect,
engineer, and financing for any such addition shall be approved in writing by
the Lessor.
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<PAGE> 12
Dated this 20th day of December, 1993, as to LESSOR, and this 20th day of
December, 1993 as to LESSEE.
Witnesses: Lessor:
/s/ Sherie M. Horton /s/ Ben M. Frizzell, Jr.
- -------------------------- --------------------------
Ben M. Frizzell, Jr.
LESSEE:
Robert F. Wright, dba
Volunteer Warehouse
/s/ Sherie M. Horton /s/ Robert F. Wright
- -------------------------- --------------------------
Robert F. Wright, Individually
By: /s/ Robert F. Wright
--------------------------
Linda D. Wright, Individually
By: /s/ Linda D. Wright
--------------------------
STATE OF TENNESSEE )
COUNTY OF SULLIVAN )
The foregoing instrument was acknowledged before me this 20th day of
December, 1993, by BEN M. FRIZZELL, JR.
/s/ Pamela Dawn Booker
--------------------------
Notary Public
My Commission Expires: 6/03/97
STATE OF TENNESSEE )
COUNTY OF SULLIVAN )
The foregoing instrument was acknowledged before me this 20th day of
December, 1993, by ROBERT F. WRIGHT.
/s/ Pamela Dawn Booker
--------------------------
Notary Public
My Commission Expires: 6/03/97
STATE OF TENNESSEE )
COUNTY OF SULLIVAN )
The foregoing instrument was acknowledged before me this 21st day of
December, 1993, by LINDA D. WRIGHT.
/s/ Pamela Dawn Booker
--------------------------
Notary Public
My Commission Expires: 6/03/97
8
<PAGE> 1
EXHIBIT 10.9
LEASE AGREEMENT
THIS LEASE ("Lease") is made by and between Douglas Dynamics, L.L.C., a
Delaware Limited Liability Company ("Lessor") and Flour City Architectural
Metals, Inc., a Delaware corporation ("Lessee").
WITNESSETH:
1. Lease of Premises - Lessor, in consideration of the covenants
and agreements to be performed by Lessee, and upon the terms and conditions
hereinafter set out, does hereby lease to Lessee, the space shown on Attachment
A hereto at 915 Riverview Drive, Route 9, Johnson City, Tennessee, together with
improvements belonging thereto, but subject to easements and restrictions of
record ("Premises"). This Lease shall include a non-exclusive right to use the
parking areas, roadways, means of ingress and egress, sidewalks and rest rooms.
2. Term - The term of this Lease shall be for five (5) years
beginning on January 1, 1997, and ending on December 31, 2001. Notwithstanding
any other term to the contrary, Lessor may terminate this Lease upon six (6)
months written notice after December 31, 1997, in the event that Lessor
terminates all its operations at the facility where the Premises are located
and with the intent to sell the premises.
3. Occupancy and Use - The Lessee shall use the Premises for
general office use and shall abide by all rules of Lessor. Lessee shall at its
own cost and expense, obtain any and all licenses and permits necessary for any
use permitted herein. Lessee shall not, without Lessor's permission, use or do
anything, or allow anything to be used or done upon the Premises which will
invalidate any policy of insurance now or hereafter carried on the Premises or
any of the contents thereof, or which may be dangerous or explosive or that
might be dangerous to people or property so as to cause an increase in the rate
of fire and/or casualty insurance on the Premises. If Lessor grants such
permission, it shall be solely on the condition that Lessee shall pay on demand
any increase in any insurance premium(s) on the Premises or the contents
thereof resulting from any such use. Lessee shall not in any manner deface or
injure the Premises or any part thereof, or overload the floors of the
Premises. Lessee will not permit any objectionable noise or odors to escape or
to be emitted from the Premises or do anything or permit anything to be done in
any way tending to disturb any other tenant in the building in which the
Premises are located or the occupants of the neighboring buildings.
With respect to the use or occupation of the Premises by the Lessee,
Lessee shall comply at its cost and expense with all laws, orders and
regulations of federal, state, county and municipal authorities, and with any
direction or recommendation of any public officer or officers, pursuant to law,
or any reasonable request of any insurance company carrying any insurance on
the Premises or any of the contents thereof.
4. Rent - Lessor agrees to lease the Premises to Lessee for the
annual rent of Ten Thousand Dollars ($10,000) for each of the first three (3)
years of the term of this Lease and Fifty Thousand Dollars ($50,000) for the
final two (2) years of this Lease and other valuable consideration, the
sufficiency of which is hereby acknowledged, to be paid no later than January 1
of each year. If any rent or payment of any other charges or expenses payable
herein is not paid within ten (10) days after its due date, it shall be subject
to late payment penalty of 1 1/2 percent of the unpaid amount due for each
month or fraction thereof that such amount remains unpaid, or such lesser
amount as may be the
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<PAGE> 2
maximum amount permitted by law, until paid. All rent and sum provided to be
paid under this Lease shall be paid to Lessor at the address stated in
Paragraph 25 of this Lease.
5. Utilities - Lessor shall, at it sole cost and expense, provide,
heat, ventilation, air conditioning, water, gas and electricity to the Premises
at a service level consistent with the level and hours of such services
provided prior the commencement of the term of the Lease.
6. Telephone - Lessee shall pay and discharge, or cause to be paid
and discharged, all charges for its telephone service or services furnished to
the Premises during this Lease. All items that can be identified including
maintenance costs, expansions and modifications and identified long distance
charges will be direct charged at costs. Common equipment and services will be
prorated by the ratio of long distance charges of Lessor and Lessee including
local service and T-I Invoicing. The ratio will be calculated each in six (6)
months at or near year end and mid-year. The main system switch of the
telephone equipment will be charged at a flat $250 per month.
7. Furniture - Lessor shall provide for Lessee's use on the
Premises during the term of the Lease the office furniture and equipment set
forth on Attachment B ("Office Equipment"). Upon termination of the Lease,
Lessor shall (i) transfer title to Lessee to the owned Office Equipment for one
dollar ($1.00) for consideration and (ii) assign to Lessee any leases of Office
Equipment which have not been terminated.
8. Assignment and Subletting - Lessee shall not, without Lessor's
prior written consent assign, mortgage, hypothecate or otherwise encumber this
Lease or the Lease interest granted hereby, or any interest therein, or
permit the use of the Premises or any part thereof by any person or persons
other than Lessee, or sublet the Premises or any part thereof.
9. Lessor's Land and Security Interest - In addition to Lessor's
lien provided by law, Lessor shall have and Lessee hereby grants to Lessor a
security interest in all goods, furniture, fixture, equipment, supplies and
other property of Lessee on the Premises and all proceeds thereof, as security
for all Lessee's obligations under this Lease. Lessee shall have a right,
however, to sell its merchandise in the normal course of business free of this
lien and security interest. Any requirement of reasonable notice to Lessee of
Lessor's intention to dispose of Lessee's property to enforce the security
interest shall be satisfied by notice given in the manner prescribed in
Paragraph 27 of this Lease at least five (5) days before the time of such
disposition. Any such sale to enforce Lessor's security interest shall be
deemed to have been a public sale conducted in a commercially reasonable manner
if held on the Premises after advertisement, with the time, place and method
of sale and a general description of the property to be sold, in a Washington
County, Tennessee, daily newspaper for five (5) consecutive business or other
days prior to the sale. Lessor shall have all rights and remedies of a
security party under law.
10. Alterations and Improvements - Lessee shall make no
alterations, deletions or improvements to the Premises, including the
installation of trade fixtures, without the prior written consent of Lessor.
Any alterations or improvements shall be at the expense of Lessee.
11. Abandoned Property - All of Lessee's furniture, movable trade
fixtures and personal property not removed from the Premises within five (5)
days of Lessor's written request at the termination of this Lease, whether such
termination occurs by lapse of time or otherwise, shall be conclusively
presumed abandoned by Lessee, and Lessor may declare
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<PAGE> 3
such property to be the property of Lessor or may dispose of such property by
any method it deems advisable.
12. Holding Over - Any holding over by Lessee after termination of
this Lease by lapse of time or otherwise (except under actual or deemed
exercise of an option under Paragraph 10 below) shall not operate to extend or
renew this Lease except by express mutual written agreement between the parties
hereto. In the absence of such agreement, Lessee shall continue in possession as
a month-to-month tenant only, and either party may thereafter terminate such
occupancy at the end of any calendar month by first giving to the other party
at least thirty (30) days prior written notice.
13. Default - The following events shall constitute events of
default:
a. Lessee's failure to pay rent or other sums payable by Lessee
under this Lease when due.
b. Lessee's failure to comply with other provisions of this Lease
if such default shall continue for a period of thirty (30) days
after written notice thereof from Lessor to Lessee, unless such
default cannot be reasonably cured within thirty (30) days and
continue diligently to pursue the curing of the same.
c. If the leasehold estate hereby created shall be taken on
execution or by other process of law, except eminent domain.
d. If Lessee shall vacate, abandon or fail to use the Premises for
a period in excess of thirty (30) days.
14. Remedies - In the event of any default set forth in the
preceding paragraph, Lessor may, at its option, exercise any one or more, or
all, of the remedies listed below. No such remedy herein or otherwise conferred
upon or reserved to Lessor shall be considered exclusive of any other remedy and
the same shall be cumulative and shall be in addition to any other remedy given
hereunder or now or hereafter existing at law or in equity or statute, and every
power and remedy given by this Lease to Lessor may be exercised from time to
time and as often as the occasion may arise or as may be deemed by Lessor to be
expedient.
a. Lessor may, without terminating this Lease, enter upon the
Premises without being liable for prosecution or any claim for
damages therefor, and do Lessee is obligated to do
under the terms of this Lease other than payment of rent, in
which event Lessee shall reimburse Lessor on demand for any
reasonable expenses which Lessor may incur in thus effecting
compliance with Lessee's obligations under this Lease.
b. Lessor may if it elects to do so, bring suit for the collection
of rent or any other damages resulting from Lessee's default
without entering into possession of the Premises or voiding
this Lease.
c. Lessor may enter upon and take possession of the Premises as
Lessee's agent without terminating this Lease and without being
liable for prosecution or any claim for damages therefor, and
relet the premises as Lessee's agent and receive rent therefor.
Lessee agrees to pay Lessor on demand for any cost incurred by
Lessor by such reletting, including costs of renovating or
repairing the Premises for a new tenant. It is expressly
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<PAGE> 4
understood and agreed however that Lessor shall have no duty to
relet the premises and Lessor's failure to do so shall not
release or affect Lessee's liability for rent or damages. If
upon reletting Lessor shall receive less than Lessee should
have paid under this Lease, Lessee shall pay Lessor the
difference. If upon reletting Lessor shall receive more than
Lessee should have paid under this Lease, Lessor shall retain
the full amount of such payment from such new tenant.
d. Lessor may terminate this Lease on five (5) days written notice
to Lessee and this Lease shall terminate on the date specified
therein. Lessee shall quit and surrender the Premises by said
date, failing which, Lessor may enter upon the Premises
forthwith or any subsequent time without additional notice or
demand, without being liable for prosecution of any claim for
damages therefor, and expel Lessee and those claiming under it
and remove their effects without being guilty of any manner of
trespass. Lessee agrees that if Lessor shall cause Lessee's
goods or effects to be removed from the Premises pursuant to
the terms hereof or of any court order, Lessor's act of so
removing such goods or effects shall be deemed to be the act of
and for the account of Lessee. In the event of such
termination, Lessor may collect from Lessee all rent or other
amounts due Lessor up to the date of termination and all
expenses in connection with Lessor's reletting of the Premises,
including without limitation, all reasonable costs, fees and
expenses of repossession, brokers, advertising, repairing,
cleaning, repainting and remodeling the Premises for reletting.
15. Subordination - Lessor reserves the right to sell, assign,
transfer, mortgage or convey any or all rights it may have in the Premises
and/or the subject of this Lease. However, the subordination of this Lease to
any mortgage hereafter placed upon the Premises shall be upon the express
condition that this Lease is recognized by Lessor's mortgagee and that the
rights of Lessee hereunder shall remain in force despite any foreclosure
proceedings with respect to any such mortgage, provided Lessee is not in
default of any of its obligations under this Lease. Upon the request of Lessor,
Lessee shall execute any and all instruments deemed by Lessor necessary and
advisable to subject or subordinate this Lease, and any rights given to Lessee
by this Lease, to any such mortgage.
16. Quiet Enjoyment - Lessor covenants with the Lessee that the
Lessee, having performed its covenants and agreements herein set forth, shall
have quiet and peaceable possession of the Premises on the terms and conditions
herein provided.
17. Governing Law - The law of the State of Tennessee, including
choice of law rules, shall apply to this Lease.
18. Entire Agreement - This Lease forms the entire agreement
between the parties and no provision herein shall be altered, waived, amended
or extended, except by writing signed by both parties. Lessor and Lessee shall
not be considered to have waived any of the rights, covenants or conditions of
this Lease unless evidenced by its written waiver, and the waiver of one
default or right shall not constitute the waiver of any other.
19. Severability - If any clause or provision of this Lease is
illegal, invalid or unenforceable under present and future laws the remainder
of this Lease shall not be affected thereby, and there shall be added as part
of this Lease at replacement clause or provision as similar in terms to such
illegal, invalid or unenforceable clause or provision as may be possible and be
legal, valid and enforceable.
-4-
<PAGE> 5
20. Successors - The provisions of this Lease shall be binding and
inure to the benefit of the Lessor and Lessee, and their respective successors,
assigns, heirs, executors and administrators.
21. Heading - The headings of any particular paragraphs herein are
intended only for convenience and are in no way to be construed as a part of
this Lease or as a limitation of the scope of the particular paragraphs to
which they refer.
22. Survival of Obligations - All obligations of Lessee hereunder
not fully performed as on the expiration or termination of the term of this
Lease shall survive the expiration or early termination of the term hereof,
except only as otherwise provided herein.
23. Independent Covenants - Lessee's covenants hereunder are
independent of Lessor's covenants hereunder and Lessee shall have no right to
withhold performance or compliance of any of its covenants (including also
payment of rent) on account of any alleged failure by Lessor to perform or
comply with any of Lessor's covenants.
24. Additional Rights of Lessor - In addition to other rights
conferred by this Lease or by law, Lessor reserves the right, to be exercised by
Lessor's sole discretion, and provided Lessor reasonably exercises such right,
to: change the name of the Premises; install and obtain a sign or signs on the
exterior or interior of the Premises; change the street address of the Premises;
designate all sources furnishing signs, sign painting and lettering; take all
measures as may be necessary or desirable for the safety and protection of the
Premises; have pass keys to the Premises; run necessary pipes, conduits and
ducts through the Premises; renovate, refurnish, relocate or modify the common
areas; and carry on any work, repairs, alterations or improvements in or about
the Premises or in the vicinity thereof. This paragraph shall not be construed
to alter or create any obligations provided in this Lease.
25. Attorneys' Fees - If either the Lessor or Lessee brings any
action under this Lease, the unsuccessful party agrees in each case to pay the
prevailing party's reasonably attorney's fees and other costs and expenses
incurred by the prevailing party in connection therewith.
26. Eminent Domain - Should the Premises be taken, appropriated or
condemned for public purposes, or voluntarily transferred in legal condemnation,
in whole or in such substantial part as to render the Premises unsuitable for
Lessee's purposes, the term of this Lease shall, at the option of Lessor in the
first instance (taken, etc. for public purposes) and at that the option of the
Lessee in the second instance (voluntarily transferred), terminate when Lessee's
right to possession is terminated. If neither party exercises this option to
terminate within ten (10) days after the date of such taking, or if the portion
of the premises taken, appropriated, condemned or voluntarily transferred in
lieu of condemnation does not render the premises unsuitable for Lessee's
purposes, then this Lease shall terminate only as to the part taken or conveyed
on the date Lessee shall yield possession, and Lessor shall make such repairs
and alterations as may be necessary to make the part not taken usable. All
compensation awarded for such taking of the Premises shall belong to and be the
property of the Lessor without any deduction therefor for any present or future
estate of Lessee and Lessee hereby assigns to Lessor all of its right, title and
interest to such award. However, Lessee shall have the right to recover from the
condemning authority, but not from Lessor, such compensation as may be awarded
to Lessee on account of the interruption of Lessee's business, for moving and
relocation expenses and for depreciation to and removal of Lessee's goods and
trade fixtures.
- 5 - 1/16/97
<PAGE> 6
27. Notices and Payment. All monies due under this Lease and any notice
required or permitted to be given under this Lease should be delivered in
person or mailed postage prepaid to the party who is to receive such payment at
the addresses set forth below or to such other places as may be designated in
writing by Lessor or Lessee.
If to Lessor:
Douglas Dynamics, L.L.C.
7777 North 73rd Street
Milwaukee, WI 53223
with a copy to:
Armco Inc.
One Oxford Centre
301 Grant Street
Pittsburgh, PA 15219-1415
If to Lessee:
Flour City Architectural Metals, Inc.
915 Riverview Drive, Rt. 9
Johnson City, TN 37601
28. Public Liability Insurance - Lessee hereby agrees to indemnify,
protect, save and hold harmless Lessor, its respective representatives, agents,
servants and employees, from and against any and all liability, costs and
expense (including attorneys' fees) arising out of or connected with the use or
occupancy of the Premises or the common areas by Lessee and/or by any of
Lessee's representatives, agents, servants, employees, licensees, invitees or
guests pursuant to this Lease, which use or occupancy results in any injury,
sickness or death, or alleged injury or death whatsoever to third persons
and/or their property. In the event that any such claim is alleged against
Lessor and/or its successors or assigns by anyone arising out of the use or
occupancy of the Premises or the common area by Lessee or by its
representatives, agents, servants, employees, licensees, invitees, or guests,
it is expressly understood and agreed that Lessee shall take over the defense
of each and every claim promptly and pay all attorney's fees, verdicts,
judgments, settlement payment and all other costs and expenses whatsoever
incurred in connection with the defense of all such claims, without exception,
it being expressly understood that Lessee shall remain fully responsible for all
such claims and will hold the aforementioned indemnities completely harmless
from and against any cost or expense whatsoever in connection therewith.
During the term of this Lease, and any extension thereof, Lessee shall,
at its own cost and expense, maintain and provide general liability insurance
coverage for the benefit and protection of Lessee, Lessor and Lessor's agents,
employees or representatives, as their interest may appear, in an amount not
less than Five Million Dollars ($5,000,000) combined single limit for personal
injury, bodily injury or property damage, or in such greater amounts of
insurance coverage as Lessor may from time to time reasonably require, against
liability of Lessee and its authorized representatives arising out of or in
connection with Lessee's use or occupancy of the Premises or the common areas.
Lessor and Lessor's agents, employees and representatives shall be named as
additional insured parties in all such insurance policies, as their respective
interests may appear. Such insurance shall be with a company acceptable to
Lessor and admitted to the business in the State of Tennessee. All such
insurance policies shall be maintained by Lessee in full force and
-6-
<PAGE> 7
effect during the entire term of this Lease and certificates indicating such
policies are in full force and providing thirty (30) days written notice to
Lessor prior to cancellation or material change shall be provided to Lessor.
Should Lessee fail to carry such insurance or to furnish Lessor with the
required insurance certificates after notification from Lessor to do so, Lessor
shall have the right to obtain such insurance and Lessee shall pay the
reasonable cost thereon to Lessor upon the demand.
29. Lessor's Right of Entry - Lessor shall have a right to enter the Premises
at all reasonable times, upon reasonable notice and in a reasonable manner for
the purpose of examining the Premises and making repairs, alterations and
improvements either to the Premises or to the utility lines or other facilities
of the Premises or to install such lines or facilities.
30. Surrender of Premises - At the expiration of this Lease, or at any
earlier termination of this Lease pursuant to any provisions hereof, Lessee
shall surrender the Premises in as good condition as they were at the beginning
of this Lease or, subject to Lessee's obligations to remove alterations,
additions or improvements as provided herein and to make repairs therefor, as
improved during Lessee's occupancy, normal wear and tear excepted, failing
which Lessor may restore the Premises and fixtures to such condition and Lessee
shall pay the reasonable cost thereof upon demand. All of Lessee's personal
property, furniture and trade fixtures not removed from the Premises when Lessee
leaves the Premises on termination of this Lease shall thereupon be
conclusively presumed to be abandoned by Lessee and forthwith become Lessor's
property provided, however, that Lessor may require Lessee to remove such
property, furniture or trade fixtures or have such property removed at a
reasonable cost to be paid by the Lessee.
DOUGLAS DYNAMICS, L.L.C.
By: /s/ JOHN B. COREY
----------------------------------
Title: President
-------------------------------
Date January 29, 1997
-------------------------------
FLOUR CITY ARCHITECTURAL METALS, INC.
By: /s/ MICHAEL J. RUSSO
----------------------------------
Title: President
-------------------------------
Date [ILLEGIBLE]
-------------------------------
-7-
<PAGE> 8
ATTACHMENT "A"
[MAP]
<PAGE> 9
ATTACHMENT B
<TABLE>
<S> <C> <C> <C>
FC-1 FED-X TABLE FC-51 WORKSTATION
FC-2 FED-X POWERSHIP FC-51 PRIME MACHINE
FC-3 CHAIR FC-53 CHAIR
FC-4 CHAIR FC-54 TABLE
FC-5 DRAWING TABLE FC-55 WORKSTATION
FC-6 TABLE FC-56 PRIME MACHINE
FC-7 WORKSTATION FC-57 CAD MACHINE
FC-8 CAD MACHINE FC-58 CHAIR
FC-9 CHAIR FC-59 FILE CABINET (2 DRAWER)
FC-10 EPSON PRINTER FC-60 FILE CABINET (2 DRAWER)
FC-11 WORKSTATION FC-61 LARGE METAL DESK
FC-12 CAD MACHINE FC-62 CHAIR
FC-13 TABLE FC-63 PLOTTER (JDL AUTO)
FC-14 CHAIR FC-64 PLOTTER (JDL AUTO)
FC-15 CHAIR FC-65 STORAGE CABINET
FC-16 TABLE FC-66 TABLE
FC-17 WORKSTATION FC-67 TABLE
FC-18 CHAIR FC-68 PLOTTER (XEROX 3050)
FC-19 CAD MACHINE FC-69 PLOTTER (VERSATEK)
FC-20 TABLE FC-70 TABLE
FC-21 WORKSTATION FC-71 WYSE TERMINAL
FC-22 CAD MACHINE FC-72 XEROX 8812 PRINTER
FC-23 CHAIR FC-73 CAD MACHINE
FC-24 TABLE FC-74 CHAIR
FC-25 WORKSTATION FC-75 CHAIR
FC-26 CAD MACHINE FC-76 PLOTTER (HP)
FC-27 CHAIR FC-77 SHELVES
FC-28 XEROX 5018 COPIER FC-78 FILE CABINET (3 DRAWER)
FC-29 CANON B550 FAX FC-79 FILE CABINET (3 DRAWER)
FC-30 TABLE FC-80 FILE CABINET (3 DRAWER)
FC-31 CHAIR FC-81 FILE CABINET (3 DRAWER)
FC-32 CAD MACHINE FC-82 FILE CABINET (3 DRAWER)
FC-33 WORKSTATION FC-83 FILE CABINET (3 DRAWER)
FC-34 LARGE METAL DESK FC-84 FILE CABINET (3 DRAWER)
FC-35 LARGE METAL DESK FC-85 FILE CABINET (3 DRAWER)
FC-36 WORKSTATION FC-86 FILE CABINET (3 DRAWER)
FC-37 CAD MACHINE FC-87 FILE CABINET (3 DRAWER)
FC-38 CHAIR FC-88 FILE CABINET (3 DRAWER)
FC-39 PRIME MACHINE FC-89 FILE CABINET (4 DRAWER)
FC-40 CHAIR FC-90 FILE CABINET (4 DRAWER)
FC-41 FILE CABINET (2 DRAWER) FC-91 FILE CABINET (4 DRAWER)
FC-42 TABLE FC-92 FILE CABINET (4 DRAWER)
FC-43 EPSON PRINTER FC-93 FILE CABINET (4 DRAWER)
FC-44 TABLE FC-94 DRAWING DRAWERS
FC-45 WORKSTATION FC-95 DRAWING DRAWERS
FC-46 CAD MACHINE FC-96 DRAWING DRAWERS
FC-47 PRIME MACHINE FC-97 DRAWING DRAWERS
FC-48 CHAIR FC-98 DRAWING DRAWERS
FC-49 FILE CABINET (2 DRAWER) FC-99 DRAWING DRAWERS
FC-50 TABLE FC-100 DRAWING DRAWERS
</TABLE>
<PAGE> 10
<TABLE>
<S> <C> <C> <C>
FC-101 DRAWING DRAWERS FC-151 CAD MACHINE
FC-102 DRAWING DRAWERS FC-152 PRIME MACHINE
FC-103 DRAWING DRAWERS FC-153 CHAIR
FC-104 DRAWING DRAWERS FC-154 FILE CABINET (2 DRAWER)
FC-105 DRAWING DRAWERS FC-155 TABLE
FC-106 DRAWING DRAWERS FC-156 TABLE
FC-107 DRAWING DRAWERS FC-157 TABLE
FC-108 DRAWING DRAWERS FC-158 TABLE
FC-109 DRAWING DRAWERS FC-159 WORKSTATION
FC-110 DRAWING DRAWERS FC-160 CAD MACHINE
FC-111 DRAWING DRAWERS FC-161 PRIME MACHINE
FC-112 DRAWING DRAWERS FC-162 CHAIR
FC-113 DRAWING DRAWERS FC-163 FILE CABINET (2 DRAWER)
FC-114 DRAWING DRAWERS FC-164 FILE CABINET (2 DRAWER)
FC-115 DRAWING DRAWERS FC-165 FILE CABINET (2 DRAWER)
FC-116 FILE CABINET (4 DRAWER) FC-166 WORKSTATION
FC-117 FILE CABINET (4 DRAWER) FC-167 PRIME MACHINE
FC-118 FILE CABINET (4 DRAWER) FC-168 CAD MACHINE
FC-119 FILE CABINET (4 DRAWER) FC-169 CHAIR
FC-120 FILE CABINET (4 DRAWER) FC-170 WORKSTATION
FC-121 FILE CABINET (4 DRAWER) FC-171 PRIME MACHINE
FC-122 CARD FILES FC-172 CHAIR
FC-123 CARD FILES FC-173 BOOKCASE
FC-124 CARD FILES FC-174 BOOKCASE
FC-125 CARD FILES FC-175 BOOKCASE
FC-126 CARD FILES FC-176 TABLE
FC-127 CARD FILES FC-177 CHAIR
FC-128 CARD FILES FC-178 TABLE
FC-129 TABLE FC-179 TABLE
FC-130 MICROWAVE FC-180 CHAIR
FC-131 SHELVES FC-181 WORKSTATION
FC-132 MICROWAVE FC-182 PRIME MACHINE
FC-133 REFRIGERATOR FC-183 FILE CABINET (4 DRAWER)
FC-134 PRIME MACHINE FC-184 DRAWING TABLE
FC-135 PARTIAL DESK FC-185 WORKSTATION
FC-136 PARTIAL DESK FC-186 CHAIR
FC-137 PARTIAL DESK FC-187 AMS COMPUTER
FC-138 PARTIAL DESK FC-188 DESK
FC-139 FILE CABINET (2 DRAWER) FC-189 TABLE
FC-140 FILE CABINET (2 DRAWER) FC-190 CHAIR
FC-141 MEMOREX COMPUTER FC-191 FILE CABINET (4 DRAWER)
FC-142 CAD MACHINE FC-192 FILE CABINET (4 DRAWER)
FC-143 TABLE FC-193 FILE CABINET (4 DRAWER)
FC-144 PRIME MACHINE FC-194 FILE CABINET (4 DRAWER)
FC-145 WORKSTATION FC-195 LARGE WOOD CREDENZA
FC-146 CHAIR FC-196 TABLE
FC-147 TABLE FC-197 MAGITRONIC COMPUTER
FC-148 CHAIR FC-198 DESK
FC-149 EPSON PRINTER FC-199 FILE CABINET (2 DRAWER)
FC-150 WORKSTATION FC-200 FILE CABINET (2 DRAWER)
</TABLE>
<PAGE> 11
FC-201 CREDENZA FC-251 ACER COMPUTER
FC-202 CHAIR FC-252 DESKJET 580C PRINTER
FC-203 CHAIR FC-253 CHAIR
FC-204 CHAIR FC-254 TABLE
FC-205 TABLE FC-255 DESKJET 600C PRINTER
FC-206 DRAWING TABLE FC-256 LATERAL FILE (2 DRAWER)
FC-207 CHAIR FC-257 DESK
FC-208 FILE CABINET (2 DRAWER) FC-258 CHAIR
FC-209 BOOKSHELF FC-259 MAGITRONIC COMPUTER
FC-210 BOOKSHELF FC-260 TABLE
FC-211 BOOKSHELF FC-261 FILE CABINET (2 DRAWER)
FC-212 TABLE FC-262 DRAWING TABLE
FC-213 FILE CABINET (4 DRAWER) FC-263 FILE CABINET (2 DRAWER)
FC-214 TABLE FC-264 FILE CABINET (2 DRAWER)
FC-215 AMS COMPUTER FC-265 FILE CABINET (2 DRAWER)
FC-216 FILE CABINET (2 DRAWER) FC-266 FILE CABINET (2 DRAWER)
FC-217 CHAIR FC-267 FILE CABINET (2 DRAWER)
FC-218 DESK FC-268 WORKSTATION
FC-219 CHAIR FC-269 CHAIR
FC-220 DESKJET 600 PRINTER FC-270 CHAIR
FC-221 FILE CABINET (2 DRAWER) FC-271 DESK
FC-222 DESK FC-272 BOOKSHELF
FC-223 ACER COMPUTER FC-273 CHAIR
FC-224 DESK FC-274 CHAIR
FC-225 FILE CABINET (2 DRAWER) FC-275 BOOKSHELF
FC-226 BOOKSHELF FC-276 DESKJET 600 PRINTER
FC-227 TABLE FC-277 CHAIR
FC-228 CHAIR FC-278 TABLE
FC-229 CHAIR FC-279 TABLE
FC-230 WORKSTATION FC-280 DESK
FC-231 TABLE FC-281 MAGITRONIC COMPUTER
FC-232 BOOKSHELF FC-282 CHAIR
FC-233 BOOKSHELF FC-283 FILE CABINET (SMALL)
FC-234 BOOKSHELF FC-284 EPSON PRINTER
FC-235 DRAWING TABLE FC-285 CHAIR
FC-236 WORKSTATION FC-286 FILE CABINET (2 DRAWER)
FC-237 CHAIR FC-287 DESK
FC-238 FILE CABINET (2 DRAWER) FC-288 MAGITRONIC COMPUTER
FC-239 CHAIR FC-289 WORK TABLE
FC-240 LARGE WOOD TABLE FC-290 BOOKSHELF
FC-241 MAGITRONIC COMPUTER FC-291 CHAIR
FC-242 LARGE METAL DESK FC-292 CHAIR
FC-243 CABINET FC-293 CHAIR
FC-244 BOOKSHELF FC-294 LATERAL FILE (2 DRAWER)
FC-245 BOOKSHELF FC-295 DESKJET 580C PRINTER
FC-246 DESK FC-296 LATERAL FILE (2 DRAWER)
FC-247 TABLE FC-297 WORKSTATION
FC-248 FILE CABINET (4 DRAWER) FC-298 CHAIR
FC-249 TABLE FC-299 CHAIR
FC-250 CHAIR FC-300 PENTIUM COMPUTER
<PAGE> 12
FCC-301 CHAIR FCC-351 CHAIR
FCC-302 CHAIR FCC-352 DESK
FCC-303 LATERAL FILE (2 DRAWER) FCC-353 COMPUTER TABLE
FCC-304 DESK FCC-354 COMPUTER TABLE
FCC-305 WORKSTATION FCC-355 CREDENZA
FCC-306 DESKJET 600 PRINTER FCC-356 BOOKCASE
FCC-307 MAGITRONIC COMPUTER FCC-357 FILE CABINET (4 DRAWER)
FCC-308 BOOKSHELF FCC-358 FILE CABINET (4 DRAWER)
FCC-309 DESKJET 600C PRINTER FCC-359 FILE CABINET (4 DRAWER)
FCC-310 CHAIR FCC-360 LATERAL FILE (2 DRAWER)
FCC-311 CHAIR FCC-361 LATERAL FILE (2 DRAWER)
FCC-312 DESK FCC-362 LATERAL FILE (2 DRAWER)
FCC-313 CHAIR FCC-363 FILE CABINET (2 DRAWER)
FCC-314 MAGITRONIC COMPUTER FCC-364 DESK
FCC-315 TABLE FCC-365 CHAIR
FCC-316 CHAIR FCC-366 CREDENZA
FCC-317 CHAIR FCC-367 LATERAL FILE (2 DRAWER)
FCC-318 DRAWING RACK FCC-368 MAGITRONIC COMPUTER
FCC-319 CHAIR FCC-369 EPSON PRINTER
FCC-320 DESK FCC-370 CHAIR
FCC-321 MAGITRONIC COMPUTER FCC-371 CHAIR
FCC-322 TABLE FCC-372 BOOKSHELF
FCC-323 EPSON PRINTER FCC-373 BOOKSHELF
FCC-324 FILE CABINET (2 DRAWER) FCC-374 FILE CABINET (4 DRAWER)
FCC-325 FILE CABINET (3 DRAWER) FCC-375 FILE CABINET (4 DRAWER)
FCC-326 CHAIR FCC-376 CHAIR
FCC-327 CHAIR FCC-377 CHAIR
FCC-328 CHAIR FCC-378 DESK
FCC-329 CHAIR FCC-379 IBM COMPUTER
FCC-330 LASERJET 4 PRINTER FCC-380 MENTOR COMPUTER
FCC-331 PRINTER STAND FCC-381 CHAIR
FCC-332 BOOKSHELF FCC-382 TABLE
FCC-333 CONFERENCE TABLE (SMALL) FCC-383 IBM COMPUTER
FCC-334 FILE CABINET (2 DRAWER) FCC-384 FILE CABINET (4 DRAWER)
FCC-335 CREDENZA FCC-385 FILE CABINET (4 DRAWER)
FCC-336 DESK (MANAGEMENT) FCC-386 FILE CABINET (4 DRAWER)
FCC-337 LAPTOP COMPUTER FCC-387 FILE CABINET (4 DRAWER)
FCC-338 FILE CABINET (4 DRAWER) FCC-388 FILE CABINET (4 DRAWER)
FCC-339 FILE CABINET (4 DRAWER) FCC-389 FILE CABINET (3 DRAWER)
FCC-340 DESK FCC-390 PORTABLE FILE
FCC-341 PENTIUM COMPUTER FCC-391 FILE CABINET (4 DRAWER)
FCC-342 LATERAL FILE (2 DRAWER) FCC-392 FILE CABINET (4 DRAWER)
FCC-343 DESKJET 540 PRINTER FCC-393 FILE CABINET (4 DRAWER)
FCC-344 CREDENZA FCC-394 FILE CABINET (4 DRAWER)
FCC-345 CHAIR FCC-395 FILE CABINET (4 DRAWER)
FCC-346 CHAIR FCC-396 FILE CABINET (4 DRAWER)
FCC-347 FILE CABINET (2 DRAWER) FCC-397 FILE CABINET (4 DRAWER)
FCC-348 FILE CABINET (2 DRAWER) FCC-398 FILE CABINET (4 DRAWER)
FCC-349 FILE CABINET (2 DRAWER) FCC-399 FILE CABINET (4 DRAWER)
FCC-350 FILE CABINET (2 DRAWER) FCC-400 FILE CABINET (4 DRAWER)
<PAGE> 13
<TABLE>
<S> <C> <C> <C>
FC-401 FILE CABINET (4 DRAWER) FC-451 FILE CABINET (2 DRAWER)
FC-402 FILE CABINET (4 DRAWER) FC-452 PORTABLE FILE
FC-403 FILE CABINET (4 DRAWER) FC-453 CHAIR
FC-404 FILE CABINET (4 DRAWER) FC-454 DESK
FC-405 TABLE FC-455 PANASONIC PRINTER
FC-406 CHAIR FC-456 SMALL CABINET
FC-407 XEROX TYPEWRITER FC-457 GENERIC COMPUTER
FC-408 ADLER ROYAL TYPEWRITER FC-458 CHAIR
FC-409 DESK FC-459 DESK
FC-410 CHAIR FC-460 CHAIR
FC-411 FILE CABINET (4 DRAWER) FC-461 TABLE
FC-412 FILE CABINET (4 DRAWER) FC-462 CHAIR
FC-413 FILE CABINET (4 DRAWER) FC-463 DESK
FC-414 FILE CABINET (4 DRAWER) FC-464 CHAIR
FC-415 FILE CABINET (4 DRAWER) FC-465 CABINET (2 DRAWER)
FC-416 CHAIR FC-466 FILE CABINET (2 DRAWER)
FC-417 CHAIR FC-467 IBM COMPUTER
FC-418 DESK FC-468 COMPUTER TABLE
FC-419 IBM COMPUTER FC-469 CHAIR
FC-420 LATERAL FILE (2 DRAWER) FC-470 CHAIR
FC-421 FOLLOWES SHREDDER FC-471 CHAIR
FC-422 FILE CABINET (4 DRAWER) FC-472 DESK
FC-423 GLASS BOOKSHELF FC-473 FILE CABINET (2 DRAWER)
FC-424 CHAIR FC-474 FILE CABINET (2 DRAWER)
FC-425 CHAIR FC-475 COMPUTER STATION
FC-426 EPSON PRINTER FC-476 COMPUTER TABLE
FC-427 PRINTER STAND FC-477 EPSON PRINTER
FC-428 DESK FC-478 MAGITRONIC COMPUTER
FC-429 CHAIR FC-479 LATERAL FILE (2 DRAWER)
FC-430 FILE CABINET (2 DRAWER) FC-480 LATERAL FILE (2 DRAWER)
FC-431 COMPUTER TABLE FC-481 DESK
FC-432 LATERAL FILE (2 DRAWER) FC-482 TABLE
FC-433 CHECK SIGNING MACHINE FC-483 FILE CABINET (4 DRAWER)
FC-434 IBM COMPUTER FC-484 CHAIR
FC-435 DESK FC-485 FILE CABINET (4 DRAWER)
FC-436 CHAIR FC-486 DESKJET 540 PRINTER
FC-437 IBM COMPUTER FC-487 TABLE
FC-438 COMPUTER TABLE FC-488 MAGITRONIC COMPUTER
FC-439 AGI COMPUTER ??? FC-489 DESK
FC-440 FILE CABINET (3 DRAWER) FC-490 CHAIR
FC-441 FILE CABINET (2 DRAWER) FC-491 CHAIR
FC-442 PAYROLL CABINET (4 SECTIONS) FC-492 CHAIR
FC-443 PAYROLL CABINET (4 SECTIONS) FC-493 DESK
FC-444 PORTABLE FILE FC-494 TABLE
FC-445 PORTABLE FILE FC-495 FILE CABINET (4 DRAWER)
FC-446 DESK FC-496 MENTOR COMPUTER
FC-447 CHAIR FC-497 COMPUTERWORKS COMPUTER
FC-448 CHAIR FC-498 EPSON PRINTER
FC-449 TABLE FC-499 CONFERENCE TABLE
FC-450 SHARP COPIER FC-500 CHAIR
</TABLE>
<PAGE> 14
<TABLE>
<S> <C> <C> <C>
FC-501 CHAIR FC-551 MAGNITRONIC COMPUTER
FC-502 CHAIR FC-552 CHAIR
FC-503 CHAIR FC-553 CHAIR
FC-504 CHAIR FC-554 SMALL TABLE
FC-505 CHAIR FC-555 PRINTER STAND
FC-506 CHAIR FC-556 DESKJET 540 PRINTER
FC-507 CHAIR FC-557 FILE CABINET (2 DRAWER)
FC-508 WORKSTATION FC-558 BOOKSHELF
FC-509 CHAIR FC-559 WORKSTATION
FC-510 FILE CABINET (2 DRAWER) FC-560 CHAIR
FC-511 PORTABLE FILE FC-561 TABLE
FC-512 WORD PROCESSOR FC-562 ACER COMPUTER
FC-513 TANDY COMPUTER FC-563 CHAIR
FC-514 EPSON PRINTER FC-564 CHAIR
FC-515 SHARP FAX FC-565 WORKSTATION
FC-516 TABLE FC-566 MAGITRONIC COMPUTER
FC-517 SOFA FC-567 DESKJET 560 PRINTER
FC-518 CHAIR FC-568 STENO MACHINE
FC-519 CHAIR FC-569 IBM TYPEWRITER
FC-520 LONG TABLE FC-570 METAL SOFA
FC-521 SIDE TABLE FC-571 LARGE WOOD CABINET
FC-522 GLASS TABLE FC-572 TABLE
FC-523 CHAIR FC-573 AT&T MONITOR ONLY
FC-524 CABINET (4 DRAWER) FC-574 CHAIR
FC-525 DESK FC-575 CHAIR
FC-526 DESK FC-576 CHAIR
FC-527 CHAIR FC-577 CHAIR
FC-528 CHAIR FC-578 DESK
FC-529 FILE CABINET (4 DRAWER) FC-579 CREDENZA
FC-530 FILE CABINET (4 DRAWER) FC-580 CHAIR (METAL FOLDING)
FC-531 FILE CABINET (4 DRAWER) FC-581 CHAIR (METAL FOLDING)
FC-532 DESK FC-582 CHAIR (METAL FOLDING)
FC-533 CHI FC-583 CHAIR (METAL FOLDING)
FC-534 TABLE FC-584 CHAIR (METAL FOLDING)
FC-535 EPSON PRINTER FC-585 CHAIR (METAL FOLDING)
FC-536 TABLE FC-586 CHAIR (METAL FOLDING)
FC-537 IBM COMPUTER FC-587 CHAIR (METAL FOLDING)
FC-538 BOOKSHELF FC-588 CHAIR (METAL FOLDING)
FC-539 PANASONIC PRINTER FC-589 CHAIR (CONFERENCE)
FC-540 MAGITRONIC COMPUTER FC-590 CHAIR (CONFERENCE)
FC-541 FILE CABINET (4 DRAWER) FC-591 CHAIR (CONFERENCE)
FC-542 FILE CABINET (4 DRAWER) FC-592 CHAIR (CONFERENCE)
FC-543 MURATA FAX FC-593 CHAIR (CONFERENCE)
FC-544 FAX STAND FC-594 CHAIR (CONFERENCE)
FC-545 BOOKSHELF FC-595 CHAIR (CONFERENCE)
FC-546 TABLE FC-596 CHAIR (CONFERENCE)
FC-547 COMPUTER DESK FC-597 CHAIR (CONFERENCE)
FC-548 IBM COMPUTER FC-598 CHAIR (CONFERENCE)
FC-549 BOOKSHELF FC-599 CONFERENCE TABLE
FC-550 WORKSTATION FC-600 MAGNAVOX TV
</TABLE>
<PAGE> 15
FC-601 TV STAND FC-651 STENO MACHINE
FC-602 RCA VCR FC-652 LATERAL FILE (2 DRAWER, WOOD)
FC-603 CHAIR FC-653 BROTHER FAX
FC-604 CHAIR FC-654 BOOKCASE
FC-605 CHAIR FC-655 TANDY PRINTER
FC-606 CHAIR FC-656 PRINTER STAND
FC-607 LARGE METAL DESK FC-657 FILE CABINET (2 DRAWER)
FC-608 DESK FC-658 DESK
FC-609 LARGE WOOD BOOKCASE FC-659 CHAIR
FC-610 DRAWING TABLE FC-660 OVERHEAD MACHINE
FC-611 TABLE FC-661 CONFERENCE TABLE
FC-612 PITNEY BOWES POSTAGE MACHINE FC-662 SHARP TV
FC-613 XEROX COPIER FC-663 RCA VCR
FC-614 CHAIR FC-664 TV STAND
FC-615 CHAIR FC-665 CHAIR (FOLDING)
FC-616 DESK FC-666 TABLE
FC-617 CHAIR FC-667 CHAIR (CONFERENCE)
FC-618 LAPTOP COMPUTER FC-668 CHAIR (CONFERENCE)
FC-619 MAGITRONIC MONITOR ONLY FC-669 CHAIR (CONFERENCE)
FC-620 DESKJET 600 PRINTER FC-670 CHAIR (CONFERENCE)
FC-621 CREDENZA FC-671 CHAIR (CONFERENCE)
FC-622 FILE CABINET (2 DRAWER) FC-672 CHAIR (CONFERENCE)
FC-623 CHAIR FC-673 CHAIR (CONFERENCE)
FC-624 CHAIR FC-674 CHAIR (CONFERENCE)
FC-625 CHAIR FC-675 CHAIR (CONFERENCE)
FC-626 CHAIR FC-676 CHAIR
FC-627 CHAIR FC-677 IBM COMPUTER
FC-628 DESK (MANAGEMENT) FC-678 IBM COMPUTER
FC-629 CREDENZA FC-679 IBM PRINTER
FC-630 CABINET (2 DOOR) FC-680 AS400
FC-631 LAPTOP COMPUTER FC-681 AS400 BACKUP EQUIPMENT
FC-632 FILE CABINET (2 DRAWER) FC-682 MODEM
FC-633 FILE CABINET (2 DRAWER) FC-683 MODEM
FC-634 BOOKSHELF FC-684 MODEM
FC-635 DESKJET 540 PRINTER FC-685 MODEM
FC-636 TABLE FC-686 COMPUTER ROOM PHONE
FC-637 METAL TABLE FC-687 PRIME PRINTER
FC-638 METAL TABLE FC-688 MICROSOFT NT SERVER
FC-639 CONFERENCE TABLE (SMALL) FC-689 UPS SERVER
FC-640 CHAIR (CONFERENCE) FC-690 NETWORK HUB & RACK
FC-641 CHAIR (CONFERENCE) FC-691 NT MONITOR
FC-642 CHAIR (CONFERENCE) FC-692 IBM COMPUTER
FC-643 CHAIR (CONFERENCE) FC-693 PRIME MONITOR
FC-644 CHAIR FC-694 PRIME HUB
FC-645 CHAIR FC-695 PRIME MODEM
FC-646 BOOKCASE FC-696 PRIME SYSTEM
FC-647 CHAIR FC-697 PRIME ADD-ON
FC-648 DESK (MANAGENENT) FC-698 UPS PRIME
FC-649 CHAIR FC-699 PRIME MONITOR
FC-650 CREDENZA FC-700 PRIME MONITOR
<PAGE> 16
<TABLE>
<S> <C> <C> <C>
FC-701 IBM MONITOR FC-751 PHONE
FC-702 MEDIA FIRE FILE FC-752 PHONE
FC-703 TEKTRONIX COMPUTER FC-753 PHONE
FC-704 LINE STABILIZER CONTAINER FC-754 PHONE
FC-705 MICROCOM MODEM FC-755 PHONE
FC-706 A-B SWITCH BOX FC-756 PHONE
FC-707 A-B SWITCH BOX FC-757 PHONE
FC-708 A-B SWITCH BOX FC-758 PHONE
FC-709 CLOCK SOURCE/MODEM ELIMINATOR FC-759 PHONE
FC-710 BOX OF DATACOM CABLES FC-760 PHONE
FC-711 BOX OF MISCELLANEOUS CABLES FC-761 PHONE
FC-712 METAL SHELVES FC-762 PHONE
FC-713 COMPUTER TABLE FC-763 PHONE
FC-714 METAL SHELVES FC-764 DRAWING RACK
FC-715 ROLLTOP TAPE CABINET FC-765 PHONE
FC-716 CABINET (2 DOOR) FC-766 PHONE
FC-717 IBM COMM. SWITCH BOX FC-767 PHONE
FC-718 IBM COMM. SWITCH BOX FC-768 PHONE
FC-719 IBM COMM. SWITCH BOX FC-769 PHONE
FC-720 UNIVERSAL MODEM FC-770 PHONE
FC-721 PRINTRONIX PRINTER BOARD FC-771 PHONE
FC-722 PC KEYBOARD FC-772 PHONE
FC-723 ROLLING CART FC-773 PHONE
FC-724 FILE CABINET (4 DRAWER) FC-774 PHONE
FC-725 COMPUTER CABLE FC-775 PHONE
FC-726 PHONE CABLE FC-776 PHONE
FC-727 NETWORK CABLE FC-777 PHONE
FC-728 NETWORK CABLE FC-778 PHONE
FC-729 GOLDSTAR MONITOR FC-779 PHONE
FC-730 COMPUTER CABLE FC-780 PHONE
FC-731 TABLE FC-781 PHONE
FC-732 CABINET (WOOD) FC-782 PHONE
FC-733 TABLE (WOOD) FC-783 PHONE
FC-734 CABINET (WOOD) FC-784 PHONE
FC-735 TABLE FC-785 PHONE
FC-736 PHONE FC-786 PHONE
FC-737 PHONE FC-787 PHONE
FC-738 PHONE FC-788 PHONE
FC-739 PHONE FC-789 PHONE
FC-740 PHONE FC-790 PHONE
FC-741 PHONE FC-791 PHONE
FC-742 PHONE FC-792 PHONE
FC-743 PHONE FC-793 PHONE
FC-744 PHONE FC-794 PHONE
FC-745 PHONE FC-795 PHONE
FC-746 PHONE FC-796 DRAWING RACK
FC-747 PHONE FC-797 ALL PARTITIONS USED BY FCAM
FC-748 PHONE FC-798 SCANNER (HP SCANJET 4P)
FC-749 PHONE FC-799 LATERAL FILE (2 DRAWER)
FC-750 PHONE FC-800 CARD FILE (7 DRAWER)
</TABLE>
<PAGE> 17
<TABLE>
<S> <C> <C> <C>
FC-801 FILE CABINET (4 DRAWER) FC-851
FC-802 FILE CABINET (4 DRAWER) FC-852
FC-803 FILE CABINET (4 DRAWER) FC-853
FC-804 FILE CABINET (4 DRAWER) FC-854
FC-805 FILE CABINET (4 DRAWER) FC-855
FC-806 FILE CABINET (4 DRAWER) FC-856
FC-807 FILE CABINET (4 DRAWER) FC-857
FC-808 ALL FCAM WAREHOUSE STORAGE FC-858
FC-809 ALL OTHER EQUIPMENT USED BY CAM FC-859
FC-810 FC-860
FC-811 FC-861
FC-812 FC-862
FC-813 FC-863
FC-814 FC-864
FC-815 FC-865
FC-816 FC-866
FC-817 FC-867
FC-818 FC-868
FC-819 FC-869
FC-820 FC-870
FC-821 FC-871
FC-822 FC-872
FC-823 FC-873
FC-824 FC-874
FC-825 FC-875
FC-826 FC-876
FC-827 FC-877
FC-828 FC-878
FC-829 FC-879
FC-830 FC-880
FC-831 FC-881
FC-832 FC-882
FC-833 FC-883
FC-834 FC-884
FC-835 FC-885
FC-836 FC-886
FC-837 FC-887
FC-838 FC-888
FC-839 FC-889
FC-840 FC-890
FC-841 FC-891
FC-842 FC-892
FC-843 FC-893
FC-844 FC-894
FC-845 FC-895
FC-846 FC-896
FC-847 FC-897
FC-848 FC-898
FC-849 FC-899
FC-850 FC-900
</TABLE>
<PAGE> 1
EXHIBIT 10.10
ASSSET TRANSFER AGREEMENT
BETWEEN
FLOUR CITY ARCHITECTURAL METALS, INC.
AND
DOUGLAS DYNAMICS, L.L.C.
DATED AS OF JANUARY 1, 1996
<PAGE> 2
ASSET TRANSFER AGREEMENT
BETWEEN
FLOUR CITY ARCHITECTURAL METALS, INC.
AND
DOUGLAS DYNAMICS, L.L.C.
DOCUMENT TAB NUMBER
Asset Transfer Agreement ............................................ 1
Exhibit A -- Warranty Deed .................................. 2
Exhibit B -- Bill of Sale, Assignment and Assumption
Agreement ...................................... 3
Schedule 1.1. Real Property ......................................... 4
Schedule 1.2 Equipment .............................................. 5
Schedule 1.2(a) Excluded Equipment .................................. 6
Schedule 1.4 Contracts and Leases ................................... 7
Schedule 1.6 Government Licenses .................................... 8
Schedule 1.7 Accounts Receivable .................................... 9
Schedule 1.8 Other Assets ........................................... 10
Schedule 2.1(b) Other Liabilities ................................... 11
Schedule 2.1(c) Accounts Payable .................................... 12
Schedule 3 Consideration ............................................ 13
Schedule 4.1.5 Environmental and Industrial Hygiene Compliance ...... 14
Schedule 5.3 Personnel .............................................. 15
<PAGE> 3
ASSET TRANSFER AGREEMENT
ASSET TRANSFER AGREEMENT (together with the exhibits and schedules
hereto, this "Agreement"), dated as of January 1, 1996, between Flour City
Architectural Metals, Inc., a corporation organized and existing under the laws
of the State of Delaware ("FCAM"), and Douglas Dynamics, L.L.C., a limited
liability company organized under the laws of the State of Delaware ("DDLLC").
WITNESSETH:
WHEREAS, FCAM wishes to transfer and assign to DDLLC, and DDLLC wishes
to accept and assume, certain real property, equipment, furniture, fixtures,
vehicles, inventories, records and other personal property; accounts
receivable; contractual rights and obligations, all of which are located in
Johnson City, Tennessee or relate to the operations of FCAM in Johnson City,
Tennessee.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants hereinafter set forth, and upon the terms and conditions hereinafter
set forth, the parties, intending to be legally bound, agree as follows:
ARTICLE I
The Assets
Subject to the terms and conditions, and on the basis of the representations,
warranties and covenants and for the consideration, set forth herein, FCAM
agrees to transfer and assign or cause to transfer and assign and DDLLC agrees
to accept and assume, all of FCAM's right, title and interest as of December
31, 1995 (the "Effective Date") in, to and under all of the following (all of
which are hereinafter collectively the "Assets"):
1.1 Real Property. All of the owned real property, including owned
improvements thereon, described in Schedule 1.1 attached hereto and made a part
hereof (hereinafter the "Real Property"). The Real Property shall be conveyed
by Warranty Deed in the form of Exhibit A.
1.2 Equipment. All equipment, furniture and fixtures, tools, vehicles,
leasehold improvements, and other items of tangible personal property owned by
FCAM physically located on the Real Property, and used exclusively in operating
the FCAM business at Johnson City, Tennessee (hereinafter the "Johnson City
Business"), whether or not reflected on the books which are described in
Schedule 1.2 attached hereto and made a part hereof (hereinafter the
"Equipment"), but not including those items set forth on Schedule 1.2(a)
(hereinafter the "Excluded Equipment").
1.3 Inventories. All maintenance, janitorial, and office supplies owned by
FCAM physically located on the Real Property and used exclusively in the
Johnson City Business, whether or not accounted for by FCAM as inventory; and
all inventories of raw materials and finished and semi-finished products and
work-in-process owned by FCAM in connection with the manufacture of products
for DDLLC, located on the Real Estate (hereinafter collectively the
"Inventories"; and the Inventories together with the Equipment and the Records
(as hereinafter defined) are hereinafter collectively the "Personal Property").
Except to the extent expressly set forth in Section 4.1.2. ALL SUCH PERSONAL
PROPERTY SHALL BE CONVEYED "AS IS" AND "WHERE IS" IN ITS CONDITION ON THE
CLOSING DATE, AND NO OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT
LIMITED TO THOSE OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, EXTEND
TO THE PERSONAL PROPERTY.
1.4 Contracts and Leases. All rights, to the extent such rights accrue
after the Closing date, in and to: (i) all contracts, agreements and purchase
orders for the sale or purchase of goods or
<PAGE> 4
services, or both, entered into by FCAM exclusively in connection with the
operation of the Johnson City Business; ((ii) all leases for the use of
personal property entered into by FCAM exclusively in connection with the
operation of the Johnson City Business, and rights attributable to portions of
leases for the use of personal property, including master leases pertaining to
vehicles and other personal property, to the extent such portions relate
exclusively to the operation of the Johnson City Business, (iii) all other
contracts and agreements entered into by FCAM of whatever nature which pertain
exclusively to the operation of the Johnson City Business, (all of items (i)
through (iii) are hereinafter collectively the "Contracts"). The Contracts are
listed on Schedule 1.4 attached hereto and made a part hereof.
1.5 Records. All sales and business records, product specifications, drawings,
correspondence, engineering, maintenance, operating and production records,
personnel records, credit records of customers, except for those portions of
such credit records received from third parties pursuant to binding confidential
obligations, and marketing or other studies relating exclusively to the Johnson
City Business, the Assets or the Liabilities, other than accounting and tax
records, which are owned by FCAM and maintained on the Real Property (the
"Records").
1.6 Government Licenses. To the extent transfer is permitted under applicable
law or regulation without liability to Armco for compliance therewith after the
Closing, all government licenses and permits held by FCAM and which pertain
exclusively to the operation of the Johnson City Business, a partial list of
which is attached as Schedule 1.6 (hereinafter the "Government Licenses").
1.7 Accounts Receivable. All rights in and to all accounts receivable owned
by FCAM and listed on Schedule 1.7, to the extent such accounts receivable are
not satisfied on or prior to the Effective Date ("Accounts Receivable").
1.8 Other Assets. The prepaid expenses, miscellaneous deposits, travel
advances and miscellaneous other assets listed on Schedule 1.8, to the extent
listed thereon.
1.9 The Equipment, Inventories and Records shall be conveyed, the Contracts,
Leases, Accounts Receivable and Other Assets shall be assigned, and the
Assumption of Liabilities shall be effected pursuant to a Bill of Sale,
Assignment and Assumption Agreement in the form of Exhibit B.
ARTICLE II
Assumption of Liabilities
2.1 Liabilities Assumed. In addition to its undertakings pursuant to Section
5.2 hereof, DDLLC hereby agrees effective as of the Effective Date to assume,
pay, perform and discharge all obligations and responsibilities (whether
arising under written contract or otherwise): (a) relating to the Assets to the
extent the same accrue after the Effective Date, including, but not limited to
all obligations under the Contracts and the Government Licenses, (b) the
liabilities relating to the Assets, including, but not limited to all
obligations under the Contracts and the Government Licenses, and the DDLLC
Employees, which are listed on Schedule 2.1(b), and; (c) the accounts payable
of FCAM listed on Schedule 2.1(c), to the extent listed thereon, (collectively
the liabilities described in Sections 2.1(a), 2.1(b) and 2.1(c) shall be the
"Assumed Liabilities").
2.2 Liabilities Not Assumed. Except for the liabilities and obligations
expressly referred to above or assumed by DDLLC elsewhere in this Agreement or
in any instrument of conveyance or assumption, DDLLC will not assume or
otherwise be responsible for any liabilities or obligations of FCAM, whether or
not arising out of the Assets or the operation of the Johnson City Business,
including but not limited to the following:
2
<PAGE> 5
2.2.1 Litigation and Claims. All litigations and claims arising out of the
operation of the Assets or the Johnson City Business on or prior to the Closing
Date, including but not limited to product liabilities and warranty claims
with respect to products manufactured, sold and delivered and services
performed by FCAM on or prior to the Closing Date.
2.2.2 Tax Liabilities. Tax liabilities of any and all kinds of FCAM or
relating to the Assets or the Johnson City Business arising prior to the
Closing Date.
2.2.3 Debt. Any indebtedness of FCAM arising prior to the Closing Date from
the operations comprising the Johnson City Business.
ARTICLE III
Consideration
In consideration for the transfer of the Assets to DDLLC by FCAM, DDLLC will
assume the liabilities and pay to FCAM the sum of $19,382,459.51. The
consideration will be allocated to the assets in accordance with Schedule 3.
ARTICLE IV
Representations and Warranties
4.1 Representations and Warranties of FCAM. FCAM hereby represents and
warrants to DDLLC the following:
4.1.1 Title to Real Property. FCAM has good and marketable fee title to such
Real Property free and clear of all mortgages, deeds of trust, security
interests, pledges or other charges or encumbrances to secure the payment of
money, subject only to the following: (a) any conditions that an accurate
survey may show; (b) easements, rights of way and other encumbrances of record;
(c) easements, rights of way and other encumbrances for public utilities or
granted to provide services to the facilities located on such Real Property to
adjacent property; (d) zoning or other governmentally established restrictions
or encumbrances; (e) liens for current taxes, assessments, governmental charges
or levies not yet due; (f) workers' or unemployment compensation liens arising
in the ordinary course of business; (g) mechanic's, materialman's, supplier's,
vendor's, garnishment or similar liens arising in the ordinary course of
business.
4.1.2 Title to Personal Property. Except as otherwise provided herein, FCAM
has good and marketable title to the Personal Property, free and clear of all
liens or encumbrances whatsoever, except for mechanic's, materialman's,
supplier's, vendor's, garnishment or similar liens arising in the ordinary
course of business.
4.1.3 Conflicts and Consents. The execution and delivery by FCAM of this
Agreement and the other agreements and documents contemplated herein and its
consummation of the transactions contemplated herein and therein will not
violate any domestic or foreign law or rule or regulation thereunder or
conflict with or result in any breach or violation of the Certificate of
Incorporation or By-laws of FCAM or constitute a default (or an event which
with notice or lapse of time or both would become a default) under, or result
in the creation of a lien, charge or encumbrance on any of the Assets pursuant
to, or constitute an event or condition that would permit termination or
acceleration of the maturity of or any indenture, mortgage, lease, agreement or
other instrument or obligation to which FCAM is a party or by which it, or any
of the Assets, may be bound or affected.
-3-
<PAGE> 6
4.1.4 Taxes
There are no pending questions to the knowledge of FCAM relating to, nor claims
asserted for, ad valorem taxes or assessments upon the Assets.
4.1.5 Environmental and Industrial Hygiene Compliance. FCAM has not received
notice, written or oral, from any governmental agency having jurisdiction,
alleging the Real Property is in violation of any federal, state or local law,
ordinance or regulation relating to the environmental conditions on, under or
about the real Property. Except as set forth in Schedule 4.1.5, to the knowledge
or Armco, FCAM has not disposed of any Hazardous Substances on, under or about
the Real Property, nor does FCAM have any knowledge of any such activity by any
other person. For the purposes of this Section 4.1.5, the term "Hazardous
Substances" shall be as defined in the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, 42 U.S.C. Sec. 9601, et
seq., and in the regulations adopted and publications promulgated pursuant to
said laws.
4.1.6 Compliance with Laws and Other Documents. FCAM has not received notice,
written or oral, from any governmental agency having jurisdiction, alleging
that FCAM is in violation or default with respect to any applicable law,
ordinance, order or regulations relating to the Johnson City Business or the
Assets, or in violation or default in any respect under any indenture,
agreement or other instrument under which FCAM is a party or may be bound,
default under or violation of which laws or regulations, indenture, agreement
or other instrument would materially adversely affect the Johnson City
Business.
ARTICLE V
Covenants
5.1 Covenants of FCAM. FCAM covenants and agrees with DDLLC as follows:
5.1.1 Further Assurances. FCAM will from time to time at the request of
DDLLC, and without further consideration, execute and deliver such further
instruments of transfer, conveyance and assignment, in addition to those
contemplated herein, and take such other action as DDLLC may reasonably request
in order to further vest in DDLLC title to the Assets as contemplated herein
and to assist DDLLC in the collection or reduction to possession of the Assets.
5.1.2 Forwarding of Payments. FCAM agrees that any payment of monies to which
DDLLC is entitled hereunder but which is made instead to FCAM for whatever
reason, will be promptly and in good faith forwarded to DDLLC, in the manner
directed by DDLLC.
5.1.3 Obtainment Consents. FCAM agrees that it will cooperate with DDLLC to
obtain the consent or agreement of any person to the assignment of any of the
Contracts, Trade Accounts Receivable or the Permits, provided, however, that
FCAM shall not be obligated to make any payments or otherwise provide any
consideration to or on behalf of such third party in consideration of such
consent or agreement; and provided further that FCAM shall have no liability to
DDLLC in the event of any such consent or agreement is not obtained.
5.1.4 Access to Records. FCAM agrees that it shall maintain all such records
and other documents in its possession which relate to the Johnson City Business,
the Assets or to the Liabilities, without charge to DDLLC, and shall keep such
records and documents in accordance with its record retention system and in no
event destroy any such records and documents less than five (5) years old. At
all reasonable times, DDLLC, its accountants, appraisers, attorneys and agents
shall be entitled to examine and copy such records and documents.
5.2 Covenants of DDLLC. DDLLC covenants and agrees with FCAM as follows:
-4-
<PAGE> 7
5.2.1 Access to Records. DDCCL agrees that at all reasonable times after the
Closing Date FCAM, its accountants, appraisers, attorneys or agents shall have
a right to reasonably examine, audit and duplicate, at FCAM's expense, all the
Records and other records and documents which relate to the operation of the
Johnson City Business prior to the Closing Date or the performance by FCAM or
DDLLC of their respective obligations hereunder or under any exhibit or
schedule hereto. DDLLC shall give FCAM three month's prior notice of the
intentional destruction by DDLLC of any Records or such other records and
documents. FCAM may, within a period of thirty (30) calendar days from receipt
of such notice, notify DDLLC of FCAM desire to retain one or more of the items
to be disposed of, whereupon DDLLC shall deliver to FCAM, at DDLLC's expense,
such items. Any items that FCAM does not request delivered to it may be
destroyed.
5.2.2 Future Advertising and Sales Activity. DDLLC shall after the Closing
Date identify itself as the owner of the Johnson Business and the Assets, and as
soon as reasonably possible after the Closing Date shall place its name in a
prominent position on all the Real Property, all business records and other
sales or advertising-related material (including materials used for the
packaging of any product) received by it hereunder. DDLLC shall use all
reasonable efforts to remove from the Real Property.
5.2.3 Forwarding of Payments. DDLLC agrees that any payment of monies to
which FCAM is entitled hereunder, but which is made instead to DDLLC for
whatever reason, will be promptly and in good faith forwarded to FCAM.
5.3 Personnel and Benefits.
5.3.1 Employment Status. All hourly and salaried employees of FCAM who are
employed exclusively in the operation of the Johnson City Business, who are so
employed immediately prior to the Closing, and who are identified on Schedule
5.3 hereto shall become employees of DDLLC (hereinafter "DDLLC Employees").
5.4 Indemnification.
5.4.1 FCAM hereby agrees to indemnify and hold harmless DDLLC against, for and
in respect of any and all damages, losses, obligations, liabilities, claims,
encumbrances, deficiencies, costs, charges and expenses (including, without
limitation, reasonable attorneys' fees and other costs and expenses incident to
any suit, action, investigation, claim or proceeding, all hereinafter referred
to collectively as "Losses") suffered, sustained, incurred, or required to be
paid by DDLLC, solely by reason of (i) any material breach or failure of
observance or performance by FCAM of any representation, warranty, covenant,
agreement or commitment made by FCAM in this Agreement or any Exhibit or
Schedule hereto; (ii) any liabilities or obligations of FCAM are not expressly
assumed by DDLLC pursuant to Sections 2.1 and 2.2 of this Agreement.
5.4.2 DDLLC hereby agrees to indemnify and hold harmless Armco, FCAM against,
for and in respect of any and all Losses suffered, sustained, incurred, or
required to be paid by FCAM solely by reason of (i) any material breach or
failure of observance or performance by DDLLC of any representation, warranty,
covenant, agreement or commitment made by DDLLC in this Agreement, any Exhibit
or Schedule hereto; (ii) any material breach or failure of observance or
performance by DDLLC of its undertaking under Section 2.1 hereof; (iii) DDLLC's
management, control, ownership and operation of the Assets and the Johnson
City Business after the Closing Date.
ARTICLE VI
Miscellaneous
6.1 Headings. The headings in this Agreement are for convenience only and
form no part of this Agreement.
-5-
<PAGE> 8
6.2 Amendment. This Agreement may not be amended except in a written
instrument signed by both parties and expressly stating it is an amendment to
this Agreement.
6.3 Choice of Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, except for the conflict of
law provisions thereof.
6.4 Third Parties. Nothing herein expressed or implied is intended or shall
be construed to confer upon or give to any person, firm or entity, other than
the parties hereto and their respective successors and permitted assigns, any
rights or remedies under or by reason of this Agreement.
6.5 Remedies Cumulative. Except as otherwise stated in this Agreement, the
rights and remedies provided in this Agreement are cumulative and not in the
alternative, and are in addition to, and, except as otherwise provided herein,
without prejudice to any other rights and remedies hereunder or otherwise at
law or in equity which might be available to a party.
6.6 Entire Agreement. This Agreement, including the Exhibits and Schedules
attached hereto, together with all the certificates, documents and agreements
to be delivered pursuant hereto, constitutes the entire agreement between the
parties pertaining to the subject matter hereof, and all prior agreements,
representations, discussions and negotiations between the parties pertaining to
the subject matter hereof, are superseded hereby.
6.7 Parties in Interest. This Agreement shall inure to the benefit of and
be binding upon the parties hereto and their respective successors,
legal representatives, and assigns. This Agreement shall not be assigned by
either party without the prior written consent of the other party. Each party
represents that it is entering into this transaction as principal for its own
account and not as an agent for any other party.
FLOUR CITY ARCHITECTURAL METALS, INC.
By: /s/ Michael J. Russo
--------------------------------
Title: President
------------------------------
DOUGLAS DYNAMICS, L.L.C.
By: [SIG]
-------------------------------
Title: President
------------------------------
-6-
<PAGE> 9
EXHIBIT B
BILL OF SALE, ASSIGNMENT AND
ASSUMPTION AGREEMENT
This Bill of Sale, Assignment and Assumption Agreement (this
"Agreement") is made and entered into as of the 1st day of January, 1996
("Effective Date") by and between Flour City Architectural Metals, Inc., a
Delaware corporation ("Assignor") and Douglas Dynamics, L.L.C., a Delaware
limited liability company ("Assignee") the terms "Assignor" and "Assignee" to
include their respective legal representatives, successors, and assigns where
the context requires or permits);
W I T N E S S E T H T H A T:
WHEREAS, Assignor has as of the Effective Date conveyed, by warranty
deed unto Assignee certain improved real property lying and being located in
Washington County, Tennessee, as more particularly described in Schedule 1.1 of
the Asset Agreement (as hereinafter defined), together with certain improvements
thereon and all appurtenances belonging thereto (the "Real Property"), pursuant
to that certain Asset Transfer Agreement dated as of December 31, 1995 between
Assignor, as seller and Assignee, as purchaser ("Asset Agreement"); and
WHEREAS, Assignor and Assignee pursuant to the terms of the Asset
Agreement intend that certain of Assignor's assets associated with the Real
Property and the operation of the Assignor's business at the Real Property be
assigned and transferred to Assignee.
NOW, THEREFORE, FOR AND IN CONSIDERATION of the sum set forth in the
Asset Agreement, the conveyance by Assignor to Assignee of the Real Property,
and the mutual covenants herein contained, the receipt and sufficiency of the
foregoing consideration being hereby acknowledged by the parties hereto,
Assignor and Assignee hereby agree as follows:
1. Personal Property, Assignor hereby transfers, grants, conveys
and assigns to Assignee all of the right, title and interest of Assignor, in
and to the personal property used in the operation or occupancy of the Real
Property including the Equipment, Inventories and Records as described in
Sections 1.2, 1.3 and 1.5 of the Asset Agreement ("Personal Property").
<PAGE> 10
2. Contracts and Leases. Assignor hereby transfers, grants,
conveys and assigns to Assignee all of Assignor's right, title, benefit, and
interest, if any, to, and under Contracts and Lease, as described in Section
1.4 of the Asset Agreement ("Contracts"). Assignor hereby indemnifies and
agrees to hold Assignee harmless from and against all claims, damages,
defaults, or other liabilities or costs (including, without limitation, court
costs and attorney's fees) which rise out of, in connection with, or under the
Contracts prior to the Effective Date. Assignee hereby indemnifies and agrees
to hold Assignor harmless from and against any claims, damages, defaults or
other liabilities or costs (including, without limitation, court costs and
attorneys' fees) which arise out of, in connection with, or under the Contracts
from and after the Effective Date.
3. Government Licenses. Subject to Paragraph 5 hereof, Assignor
hereby transfers, grants, conveys and assigns to Assignee all of the right,
title, interest, and benefit of Assignor, if any, in, to, and under any and all
sewer and water permits and licenses, building permits, certificates of
occupancy, demolition and excavation permits, and right-of-way permits, utility
permits, drainage rights and environmental permits related to the Real Property.
4. Accounts Receivable and Other Assets. Assignor hereby
transfers, grants, conveys and assigns to Assignee all of the right, title and
interest of Assignor, in and to the Accounts Receivable as described in
Schedule 1.7 of the Asset Agreement and to the Other Assets as described in
Schedule 1.8 of the Asset Agreement.
5. Purchase Agreement. The transfers assignments and assumptions
set forth are subject to the terms and provisions of the Asset Agreement and to
the extent of any conflict between the terms and provisions of this Agreement
and the Asset Agreement, the terms and provisions of the Asset Agreement shall
control.
6. Assignee hereby accepts such assignment and agrees with
Assignor to assume, and hereby does assume and agree to pay, perform and
discharge directly to the respective parties to the Contracts and with their
successors in interest, and with the government agencies or bodies which issued
or are responsible for administering the Government Licenses, all liabilities
and obligations of Assignor described in Section 2.1 of the Asset Agreement
(the "Assumed Liabilities"). The assumption of Assumed Liabilities by the
Assignee hereunder is not intended to and does not confer any rights on any
party other than Assignor, and without limiting the foregoing, this Agreement
does not create or expand any rights of any third party. Such assumption shall
not subject the Assignee to any greater liability, with respect to any of the
Assumed Liabilities, than would have been enforceable against Assignor. Except
for the Assumed Liabilities, and for certain
- 2 -
<PAGE> 11
other undertakings in the Asset Agreement, the Assignee is not assuming any
other debt, liability, contract, commitment, engagement, license or other
obligation of Assignor, whether fixed or contingent.
7. Assignor and Assignee agree that this Agreement shall be void
and of no force or effect with respect to any particular Contract or
Governmental License unless and until any required consent of any third party
shall have been obtained.
8. Assignor and Assignee agree that if the consent of any third
party necessary for Assignor to assign any of the Contracts to the Assignee is
not obtained, then, to the extent permitted without such consent, the Assignee
will fully perform and discharge all of Assignor's obligations under such
Contracts as subcontractor of Assignor. As compensation for performing such
obligations, Assignor shall pay to Assignee in a commercially reasonable manner
to effectuate the subcontracting provisions hereof.
9. This Agreement shall be construed and enforced in accordance
with the laws of the State of Delaware except for the conflict of law
provisions thereof. This Agreement may be executed simultaneously in two or
more counterparts, each of which shall be deemed an original but all of which
together shall constitute but one and the same instrument.
10. Successors and Assigns. The Agreement shall inure to the
benefit of, and be binding upon, the respective legal representatives,
successors, and assigns of the parties hereto.
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<PAGE> 12
IN WITNESS WHEREOF, the parties hereto have duly executed these presents
as of this 31st day of December, 1995.
ASSIGNOR:
Flour City Architectural Metals, Inc.
By: MICHAEL J. RUSSO
-----------------------------------
Name: Michael J. Russo
Title: President
ASSIGNEE:
Douglas Dynamics, L.L.C.
By: /s/
-----------------------------------
Name:
Title:
<PAGE> 1
EXHIBIT 10.11
MANUFACTURING AGREEMENT
This Agreement, is made as of the 1st day of January, 1997 by and between
Douglas Dynamics, L.L.C., a Delaware limited liability company, hereinafter
called "DDLLC" and Flour City Architectural Metals, Inc., a Delaware
corporation, hereinafter called "FCAM".
WHEREAS, FCAM is engaged in the business of designing and erecting curtain
wall systems; and
WHEREAS, DDLLC is engaged in the business of fabricating curtain walls at
its manufacturing plant in Johnson City, Tennessee (hereinafter referred to as
the "Facility"); and
WHEREAS, FCAM desires to purchase fabricated curtain wall systems and
components from DDLLC and DDLLC desires to fabricate curtain wall systems and
components for FCAM.
NOW THEREFORE, in consideration of the mutual premises set forth herein
the parties agree as follows:
I. MANUFACTURING
DDLLC shall manufacture and produce at the Facility and FCAM shall
purchase from DDLLC such curtain wall systems and components ("Products") for
the New York Psych Hospital, Boston Courthouse, JFK Terminal 1 and University
of California Davis projects (the "Projects") described in the specifications
attached to this Agreement as Exhibit A in such quantities as are set forth
therein. DDLLC shall not have any obligation to perform any work requiring the
use of its liquid paint line after May 1, 1997.
II. GENERAL CONDITIONS
A. Inspection
(a) FCAM shall have the right to inspect inventory, work-in
progress and Products to the extent practicable at the Facility. FCAM may also
inspect the Facility or any
<PAGE> 2
subcontractor engaged pursuant to this Agreement. FCAM shall perform
inspections in a manner that will not unduly delay the work.
(b) FCAM may require DDLLC, at DDLLC's expense, to replace
or correct any Product that is nonconforming at time of delivery. Products may
be deemed nonconforming when defective in material or workmanship or otherwise
not in conformity with the requirements of this Agreement.
B. Independent Contractor
DDLLC, in the performance of the work hereunder, shall be and
act as an independent contractor and not an agent for or employee of FCAM. As
an independent contractor, DDLLC shall not enter into any contract or accept or
assign any document, or incur any liability, expense, obligation or
responsibility on behalf of FCAM without the prior written consent of FCAM.
C. Warranties and Claims
(a) Guaranties and warranties from manufacturers and
suppliers of equipment and materials used in the performance of this Agreement
shall run to DDLLC.
(b) DDLLC shall, at its sole expense, provide an 18 months
parts and labor warranty on any Product found to be defective in manufacture,
workmanship or quality commencing on the date of acceptance of building by
general contractor.
(c) FCAM shall be entitled to file claims against DDLLC for
any failure by DDLLC to comply with the requirements of Exhibit A, or the plans
and specifications ("specifications") provided to and accepted by DDLLC;
provided, however, that in no event shall FCAM be entitled to assert a claim
for less than $1000, nor in excess of $15,000. A claim shall include all direct
costs and expenses arising from any failure to comply with the Specifications.
-2-
<PAGE> 3
D. Licenses and Permits
DDLLC has obtained and shall keep during the
performance of this Agreement all licenses, permits, approvals, franchises,
variances and authorization (federal, state and local) material to the
performance by DDLLC of this Agreement.
E. Delivery
Deliver will be FOB at the Facility.
F. Unenforceable or Invalid Provisions
If any term(s) or provision(s) of this Agreement shall
be finally determined by competent authority to be void or unenforceable under
any applicable state or federal law or municipal or local ordinance or
regulation, such determination shall not affect the remainder of this
Agreement, which thereafter shall be construed in the applicable jurisdiction
as not containing the particular term(s) or provision(s) specifically
determined to be invalid, and the rights and obligations of the parties hereto
shall be construed and enforced accordingly.
III. PRICE AND PAYMENT TERMS
A. FCAM shall pay DDLLC for Products delivered under this
Agreement in accordance with the prices set forth on Exhibit A.
B. FCAM shall make payment to DDLLC for Products delivered
to FCAM by DDLLC within thirty (30) days of the date of delivery or instruction
to hold in storage.
C. Cost Changes
FCAM and DDLLC shall adjust the prices set forth on
Exhibit A in the event that there are any change orders changing the scope of
the work set forth on Exhibit A.
-3-
<PAGE> 4
IV. REPRESENTATIONS AND WARRANTIES
A. Representations and Warranties of DDLLC
DDLLC hereby represents and warrants to FCAM the following:
(a) DDLLC is a limited liability company duly organized, validly
existing and in good standing under the laws of the State of Delaware, with the
corporate power and authority to conduct its business and to own or lease its
property and assets, and is duly qualified or licensed to do business and is in
good standing as a foreign corporation in the State of Tennessee.
(b) DDLLC has the corporate power and authority to execute, deliver
and carry out the terms of this Agreement and has taken all necessary corporate
action to authorize the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby. This Agreement is a
legal, valid and binding obligation of DDLLC, enforceable in accordance with
its terms.
B. Representations and Warranties of FCAM
FCAM hereby represents and warrants to DDLLC the following:
(a) FCAM is a corporation for profit, duly organized, validly
existing and in good standing under the laws of the State of Delaware, with
full power and authority to conduct its business and to own or lease its
property and assets.
(b) FCAM has the power and authority to execute, deliver and carry
out the terms of this Agreement and has taken all necessary action to authorize
the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby. This Agreement has been duly authorized,
executed and delivered by FCAM and is a legal, valid and binding obligation of
FCAM, enforceable in accordance with its terms.
<PAGE> 5
V. FORCE MAJEURE
DDLLC shall not be liable for any act, omission, result or
consequence, including but not limited to any delay in delivery or performance,
which is (i) due to any act of God, the prior performance of any government
order, local labor shortage, fire, flood or other casualty, governmental
regulation or requirement, shortage or failure of raw material supply, fuel,
power or transportation, breakdown of equipment or any cause beyond DDLLC's
reasonable control whether of similar nature to those above enumerated or
(ii) due to any strike, labor dispute, or difference with workers, regardless of
whether or not DDLLC is capable of settling any such labor problem.
VI. LIMITATION OF LIABILITY
DDLLC's liability hereunder shall be limited to the obligation
to furnish the manufacturing to repair or replace only those Products proven
to have failed to meet the specifications provided to DDLLC by FCAM or to have
been defective in quality or workmanship at the time of delivery or allow
credit therefor, at its option. DDLLC's total cumulative liability in any way
arising from or pertaining to any product sold or required to be sold under
this contract shall not in any case exceed the purchase price paid by FCAM for
such Product.
IN NO EVENT SHALL DDLLC HAVE ANY LIABILITY FOR COMMERCIAL LOSS,
CLAIMS FOR LABOR, OR CONSEQUENTIAL DAMAGES OF ANY OTHER TYPE, WHETHER FCAM'S
CLAIM BE BASED IN CONTRACT, TORT, WARRANTY, OR STRICT LIABILITY, OR OTHERWISE.
IN NO EVENT SHALL DDLLC BE LIABLE FOR ANY CONSEQUENTIAL OR ANY
OTHER DAMAGES RESULTING FROM FAILURE OR DELAY IN DELIVERY. NO DELIVERY DATES
ARE GUARANTEED.
VII. TRANSFER OF POSSESSION AND TRANSFER OF TITLE TO EQUIPMENT AND
REMOVAL OF MATERIALS.
A. FCAM and DDLLC agree that the equipment listed on
Exhibit B ("Equipment") will be removed by DDLLC and from DDLLC's Johnson City
facility not later than
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<PAGE> 6
June 1, 1997. The parties shall cooperate in the expeditious removal and
transfer of the Equipment. FCAM agrees not to remove the equipment set forth
on Exhibit B under the categories "Equipment at Riverview Drive Plant
Fabrication," "Assembly," and "Welding" from DDLLC's Johnson City facility
until the earlier of (i) the date DDLLC no longer has a need for the equipment
in completing the scope of work described in Exhibit A, or (ii) June 1, 1997.
B. To the extent that the DDLLC has title to any of the
Equipment, for good and valuable consideration received, DDLLC hereby assigns,
transfers and conveys to FCAM all right, title and interest in and to said
Equipment, free and clear of all liens.
C. In the event that FCAM does not remove the Equipment
and FCAM materials by September 1, 1997, FCAM shall pay rent to DDLLC for
storage at the rate of thirty cents per square foot ($.30/sq. ft.) for inside
storage and ten cents per square foot ($.10/sq. ft.) for outside storage on a
month to month basis. After December 31, 1997, DDLLC shall have the right to
require FCAM to remove all equipment and FCAM materials upon sixty (60) days
prior written notice. (Square footage will be calculated on out to out
dimensions occupied.)
VIII. TAXES
FCAM shall be responsible, pay and discharge all tax
obligations related to (i) the manufacturing of the Products including sales
and use taxes, and (ii) the transfer of equipment, including transfer and
personal property taxes, but excluding taxes based on the net income of DDLLC.
IX. CHANGES IN AGREEMENT
This Agreement may not be altered, changed or amended except by
an instrument in writing signed by both parties hereto.
X. SOLE AGREEMENT
This Agreement is in substitution of any and all agreements
heretofore entered into between the parties hereto for the manufacturing of
Products, and said prior agreements are hereby revoked with reference to all
work starting subsequent to the date hereof.
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<PAGE> 7
XI. AGREEMENT NONASSIGNABLE
This Agreement shall not be assigned by either party without
the express written consent of the other party.
XII. TERM AND CANCELLATION
This Agreement is effective the day and year first above
written and shall continue until completion of the scope of work described on
Exhibit A; provided, however, that DDLLC shall not accept change orders
requiring use of its liquid paint line after May 1, 1997.
XIII. CHOICE OF LAW
This Agreement shall be governed by and construed in accordance
with the laws of the State of Tennessee, except for the conflict of laws
provision thereof.
IN WITNESS WHEREOF, the said parties have hereunto set their hands the
day and year first above written.
DOUGLAS DYNAMICS, INC. FLUOR CITY ARCHITECTURAL
a Delaware limited liability company METALS, INC.
By: /s/ JOHN B. DOREY By: /s/ MICHAEL J. RUSSO
Title: President Title: President
-7-
<PAGE> 1
EXHIBIT 10.12
ALL SECTIONS MARKED WITH TWO ASTERISKS ("**") REFLECT PORTIONS WHICH
HAVE BEEN REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION BY FLOUR CITY INTERNATIONAL, INC. AS PART OF A REQUEST FOR
CONFIDENTIAL TREATMENT.
This Agreement, made as of the Fourth day of December in the year one thousand
nine hundred and ninety-six by and between TURNER CONSTRUCTION COMPANY, a New
York Corporation, (hereinafter called TURNER) and FLOUR CITY ARCHITECTURAL
METALS, INC., a Delaware Corporation with offices located at 915 Riverview
Drive, Johnson City, TN 37601 (hereinafter called the Subcontractor).
Contract No. 6000H
A. L. 24
TCCo. 21
Description of Work
Witnesseth, that the Subcontractor and Turner agree as follows:
ARTICLE I. The Subcontractor shall perform and furnish all the work, labor,
services, materials, plant, equipment, tools scaffolds, appliances and all other
things necessary for B. P. 3A Glazed Aluminum Curtain Wall System (hereinafter
called the Work) for and at the Cleveland Clinic Foundation, Health Sciences
Center (hereinafter called the Project), located on premises at 9600 Carnegie
Avenue, Cleveland, Ohio (hereinafter called the Premises), as shown and
described in and in strict accordance with the Plans, Specifications, General
Conditions, Special Conditions and Addenda thereto prepared by Cesar Pelli, New
Haven, CT (hereinafter called the Architect) and with the terms and provisions
of the General Contract (hereinafter called the General Contract) between Turner
and The Cleveland Clinic Foundation (hereinafter called the Owner) dated October
23, 1996 (Letter of Intent) and in strict accordance with the additional
Provisions, page(s) 3A thru 3E annexed hereto and made a part hereof.
Contract Documents
ARTICLE II. The Plans, Specifications, General Conditions, Special
Conditions, Addenda and General Contract hereinabove mentioned, are available
for examination by the Subcontractor at all reasonable times at the office of
Turner, all of the aforesaid, including this Agreement, being hereinafter
sometimes referred to as the Contract Documents. The Subcontractor represents
and agrees that it has carefully examined and understands this Agreement and the
other Contract Documents, has investigated the nature, locality and site of the
Work and the conditions and difficulties under which it is to be performed and
that it enters into this Agreement on the basis of its own examination,
investigation and evaluation of all such matters and not in reliance upon any
opinions or representations of Turner, or of the Owner, or of any of their
respective officers, agents, servants, or employees.
With respect to the Work to be performed and furnished by the Subcontractor
hereunder, the Subcontractor agrees to be bound to Turner by each and all of the
terms and provisions of the General Contract and the other Contract Documents,
and to assume toward Turner all of the duties, obligations and responsibilities
that Turner by those Contract Documents assumes toward the Owner, and the
Subcontractor agrees further that Turner shall have the same rights and
remedies as against the Subcontractor as the Owner under the terms and
provisions of the General Contract and the other Contract Documents has against
Turner with the same force and effect as though every such duty, obligation,
responsibility, right or remedy were set forth herein in full. The terms and
provisions of this Agreement with respect to the Work to be performed and
furnished by the Subcontractor hereunder are intended to be and shall be in
addition to and not in substitution for any of the terms and provisions of the
General Contract and the other Contract Documents.
This Subcontract Agreement, the provisions of the General Contract and the
other Contract Documents are intended to supplement and complement each other
and shall, where possible, be thus interpreted. If, however, any provision of
this Subcontract Agreement irreconcilably conflicts with a provision of the
General Contract and the other Contract Documents, the provision imposing the
greater duty or obligation on the Subcontractor shall govern.
Although drawn by Turner, this Subcontract Agreement shall, in the event of
any dispute over its meaning or application, be interpreted fairly and
reasonably and neither more strongly for nor against either party to it.
Time of Completion
ARTICLE III. The Subcontractor shall commence the Work when notified to do
so by Turner and shall diligently and continuously prosecute and complete the
Work and coordinate the Work with the other work being performed on the Project,
in accordance with the project schedule, any revisions to the project schedule,
and any other scheduling requirements listed in this Agreement, so as not to
delay, impede, obstruct, hinder or interfere with the commencement, progress or
completion of the whole or any part of the Work or other work on the Project.
The Subcontractor shall participate and cooperate in the development of the
project schedule providing information for the scheduling of the times and
sequence of operations required for its Work to meet Turner's overall schedule
requirements, shall continuously monitor the project schedule so as to be fully
familiar with the timing, phasing and sequence of operations of the Work and of
other work on the Project, and shall execute the Work in accordance with the
requirements of the project schedule including any revisions thereto.
Should the progress of the Work or of the Project be delayed by any fault
or neglect or act or failure to act of the Subcontractor or any of its officers,
agents, servants, employees, subcontractors or suppliers so as to cause any
additional cost, expense, liability or damage to Turner or to the Owner or any
damages or additional costs or expenses for which Turner or the Owner may or
shall become liable, the Subcontractor shall and does hereby agree to compensate
Turner and the Owner for and indemnify them against all such costs, expenses,
damages and liability.
1
<PAGE> 2
** Confidential treatment requested pursuant to Rule 406
Turner, if it deems necessary, may direct the
Subcontractor to work overtime and if so directed the
Subcontractor shall work said overtime and, provided that
the Subcontractor is not in default under any of the terms
or provisions of this Agreement or of any of the other
Contract Documents. Turner will pay the Subcontractor for
such actual additional wages paid, if any, at rates which
have been approved by Turner, plus taxes imposed by law on
such additional wages, plus workers' compensation
insurance, liability insurance and levies on such
additional wages if required to be paid by the
Subcontractor.
If, however, the progress of the Work or of the
Project be delayed by delayed by any fault or neglect or
act or failure to act of the Subcontractor or any of its
officers, agents, servants, employees, subcontractors or
suppliers, then the Subcontractor shall, in addition to
all of the other obligations imposed by this Agreement
upon the Subcontractor in such case, and at its own cost
and expense, work such overtime as may be necessary to
make up for all time lost in the completion of the Work
and of the Project due to such delay. Should the
Subcontractor fail to make up for the time lost by reason
of such delay, Turner shall have the right to cause other
subcontractors to work overtime and to take whatever other
action it deems necessary to avoid delay in the completion
of the Work and of the Project, and the cost and expense
of such overtime and/or such other action shall be borne
by the Subcontractor.
Price ARTICLE IV. The sum to be paid by Turner, out of
funds received from the owner, to the Subcontractor for
the satisfactory performance and completion of the Work
and, of all of the duties, obligations and
responsibilities of the Subcontractor under this Agreement
and the other Contract Documents shall be **.
(hereinafter called the Price) subject to additions
and deductions as herein provided
The price includes all Federal, State, County,
Municipal and other taxes imposed by law and based upon
labor, services, materials, equipment or other items
acquired, performed, furnished or used for or in
connection with the Work, including but not limited to
sales, use and, personal property taxes payable by or
levied or assessed against the Owner. Turner or the
Subcontractor. Where the law requires any such taxes to be
stated and charged separately, the total price of all
items included in the Work plus the amount of such taxes
shall not exceed the Price.
Monthly On or before the last day of each month the
Estimate Subcontractor shall submit to Turner, in the form required
by Turner, a written requisition for payment showing the
proportionate value of the Work installed to that date,
from which shall be deducted; **; all previous payments;
and all charges for services, materials, equipment and
other items furnished by Turner to or chargeable to the
Subcontractor, and the balance of the amount of such
requisition, as approved by Turner and the Architect and
for which payment has been received by Turner from the
Owner, shall be due and paid to the Subcontractor on or
about ** .
The obligation of Turner to make a payment under
this Agreement, whether a progress or final payment, or
for extras or change orders or Delays to the Work is
subject to the express condition precedent of payment
therefor by the Owner. If Turner has provided payment or
performance bonds or a combination payment and performance
bond, the obligation of Turner and its surety under any of
those bonds to make any payment (whether a progress
payment or final payment) to a claimant on that bond is
similarly subject to the express condition precedent of
payment therefor by the Owner.(*)
The Subcontractor shall submit with its first
requisition for payment a detailed schedule showing the
breakdown of the Price into its various parts for use only
as a basis of checking the Subcontractor's monthly
requisitions.
Turner reserves the right to advance the date of any
payment (including the final payment) under this Agreement
if, in its sole judgment, it becomes desirable to do so.
The Subcontractor agrees that, if and when requested
so to do by Turner, it shall furnish such information,
evidence and substantiation as Turner may require with
respect to the nature and extent of all obligations
incurred by the Subcontractor for or in connection with
the Work, all payments made by the Subcontractor thereon,
and the amounts remaining unpaid, to whom and the reasons
therefor.
Final Final payment to the Subcontractor shall be
Payment made only with funds received by Turner from the Owner,
the Construction Lender or the Owner's Agent as final
(*) SEE ADDI- payment for work under the general contract. Final payment
TIONAL PROVI- to Turner by the Owner shall be an express condition
SIONS, ITEM 33 precedent which must occur before Turner shall be
ON PAGE 3E FOR obligated to make final payment to the Subcontractor.
CLARIFICATIONS In addition, final payment by Turner to the
Subcontractor shall not become due and payable until the
following other express condition precedent have been met:
(1) the completion and acceptance of the Work by Turner
and the Architect; (2) provision by the Subcontractor of
evidence satisfactory to Turner that there are no claims,
obligations or liens outstanding or unsatisfied for labor,
services, materials, equipment, taxes or other items
performed, furnished, or incurred for or in connection
with the work; and (3) execution and delivery by the
Subcontractor, in a form satisfactory to Turner, of a
General Release running to and in favor of Turner and the
Owner. Should there prove to be any such claim, obligation
or lien after final payment is made, the subcontractor
shall refund to Turner all monies that Turner and/or the
Owner shall pay in satisfying, discharging or defending
against any such claim, obligation or lien or any action
bought or judgment recovered thereon and all costs and
expenses, including legal fees and disbursements, incurred
in connection therewith. The final payment shall be due
within ** days after all of these express conditions
precedent have been met.(*)
Payments If any claim or lien is made or filed with or
Withheld against Turner, the Owner, the Project or the Promises by
any person claiming that the Subcontractor or any
subcontractor or other person under subcontract has failed
to make payment for any labor, services, materials,
equipment, taxes or other items or obligations furnished
or incurred for or in connection with the Work, or if at
any time there shall be evidence of such nonpayment or of
any claim or lien for which, if established. Turner or the
Owner might become liable and which is chargeable to the
Subcontractor, or if the Subcontractor or any
subcontractor or other person under subcontract causes
damage to the Work or to any other work on the Project, or
if the Subcontractor fails to perform or is otherwise in
default under any of the terms or provisions of this
Agreement. Turner shall have the right to retain from any
payment then due or thereafter to become due an amount
which it deems sufficient to (1) satisfy, discharge and/or
defend against any such claim or lien or any action which
may be brought or judgment which may be recovered thereon,
(2) make good any such nonpayment, damage, failure or
default, and (3) compensate Turner and the Owner for and
indemnify them against any and all losses, liability,
damages, costs and expenses, including legal fees and
disbursements, which may be sustained or incurred by
either or both of them in connection therewith. Turner
shall have the right to apply and charge against the
Subcontractor so much of the amount retained as may be
required for the foregoing purposes. If the amount is
insufficient therefor, the Subcontractor shall be liable
for the difference and pay the same to Turner.
Payments No payment (final or otherwise) made under or in
etc., non- connection with this Agreement shall be conclusive
Acceptance evidence of the performance of the Work or of this
Agreement, in whole or in part, and no such payment shall
be construed to be an acceptance of defective, faulty or
improper work or materials nor shall it release the
Subcontractor from any of its obligations under this
Agreement; nor shall entrance and use by the Owner
constitute acceptance of the Work or any part thereof.
2
<PAGE> 3
Extension ARTICLE V. Should the Subcontractor be delayed, obstructed,
of Time hindered or interfered with in the commencement, prosecution or
completion of the work by any cause, including but not limited
to any act, omission, neglect, negligence or default of Turner
or of anyone employed by Turner, or by any other contractor or
subcontractor on the Project, or by the Architect, the Owner or
their contractors, subcontractors, agents or consultants, or by
damage caused by fire or other casualty or by the combined
action of workers or by governmental directive or order in no
wise chargeable to the Subcontractor, or by any extraordinary
conditions arising out of war or government regulations, or by
any other cause beyond the control of and not due to any fault,
neglect, act or omission of the Subcontractor, its officers,
agents, employees, subcontractors or suppliers, then the
Subcontractor shall be entitled to an extension of time for a
period equivalent to the time lost by reason of any and all of
the aforesaid causes; provided, however, that the Subcontractor
shall not be entitled to any such extension of time unless the
Subcontractor (1) notifies Turner in writing of the cause or
causes of such delay, obstruction, hindrance or interference
within forty eight (48) hours of the commencement thereof and
(2) demonstrates that it could not have anticipated or avoided
such delay, obstruction, hindrance or interference and has used
all available means to minimize the consequences thereof.
The Subcontractor agrees that it shall not be entitled to
nor claim any cost reimbursement, compensation or damages for
any delay, obstruction, hindrance or interference to the Work
except to the extent that Turner is entitled to corresponding
cost reimbursement, compensation or damages from the Owner under
the Contract Documents for such delay, obstruction, hindrance or
interference, and then only to the extent of the amount, if any,
which Turner, on behalf of the Subcontractor, actually receives
from the Owner on account of such delay, obstruction, hindrance
or interference.
Freight ARTICLE VI. The Subcontractor in making or ordering
Charges and shipments shall not consign or have consigned materials,
Shipments equipment or any other items in the name of Turner. Turner is
under no obligation to make payment for charges on shipments
made by or to the Subcontractor but may, at its option, pay such
charges, in which case the Subcontractor shall reimburse Turner
for the amount of such payments plus a service charge of
twenty-five percent (25%) of the amount so paid.
Dimensions ARTICLE VII. Notwithstanding the dimensions on the Plans,
Specifications and other Contract Documents it shall be the
obligation and responsibility of the Subcontractor to take such
measurements as will insure the proper matching and fitting of
the Work covered by this Agreement with contiguous work.
Shop The Subcontractor shall prepare and submit to Turner such
Drawings shop drawings as may be necessary to describe completely the
details and construction of the Work. Approval of such shop
drawings by Turner and/or the Architect shall not relieve the
Subcontractor of its obligation to perform the Work in strict
accordance with the Plans, Specifications, the Additional
Provisions hereof and the other Contract Documents, nor of its
responsibility for the proper matching and fitting of the Work
with contiguous work and the coordination of the Work with other
work being performed on the site, which obligation and
responsibility shall continue until completion of the Work.
Contiguous Should the proper and accurate performance of the Work
Work hereunder depend upon the proper and accurate performance of
other work not covered by this Agreement, the Subcontractor
shall carefully examine such other work, determine whether it is
in fit, ready and suitable condition for the proper and accurate
performance of the Work hereunder, use all means necessary to
discover any defects in such other work, and before proceeding
with the Work hereunder, report promptly any such improper
conditions and defects to Turner, in writing and allow Turner a
reasonable time to have such improper conditions and defects
remedied.
Interpretation ARTICLE VIII. The Work hereunder is to be performed and
of Plans and furnished under the direction and to the satisfaction of both
Specifications the Architect and Turner. The decision of the Architect as to
the true construction, meaning and intent of the Plans and
Specifications shall be final and binding upon the parties
hereto. Turner will furnish to the Subcontractor such additional
information and Plans as may be prepared by the Architect to
further the Work to be performed and furnished by the
Subcontractor and the Subcontractor shall conform to and abide
by the same.
The Subcontractor shall not make any changes, additions
and/or omissions in the Work except upon written order of Turner
as provided in Article IX hereof.
Change ARTICLE IX. Turner reserves the right, from time to time,
Orders, whether the Work or any part thereof shall or shall not have
Additions been completed, to make changes, additions and/or omissions in
and the Work as it may deem necessary, upon written order to the
Deductions Subcontractor. The value of the work to be changed, added or
omitted shall be stated in said written order and shall be added
to or deducted from the Price.
The value of the work to be changed, added or omitted shall
be determined by the lump sum or unit prices, if any, stipulated
herein for such work. If no such prices are stipulated, such
value shall be determined by whichever of the following methods
or combination thereof Turner may elect:
(a) By adding or deducting a lump sum or an amount determined by
a unit price agreed upon between the parties hereto.
PER SECTION "L"
OF TURNER'S
SPECIAL
CONDITIONS
Should the parties hereto be unable to agree as to the value of
the work to be changed, added or omitted, the Subcontractor
shall proceed with the work promptly under the written order of
Turner from which order the stated value of the work shall be
omitted, and the determination of the value of the work shall be
referred to the Architect whose decision shall be final and
binding upon the parties hereto.
In the case of omitted work Turner shall have the right to
withhold from payments due or to become due to the Subcontractor
an amount which, in Turner's opinion, is equal to the value of
such work, until such time as the value thereof is determined by
agreements or by the Architect as hereinabove provided.
All changes, additions or omissions in the Work ordered in
writing by Turner shall be deemed to be a part of the Work
hereunder and shall be performed and furnished in strict
accordance with all of the terms and provisions of this
Agreement and the other Contract Documents.
3
<PAGE> 4
CLEVELAND CLINIC FOUNDATION
HEALTH SCIENCES CENTER - PHASE 1
CLEVELAND, OHIO
CONTRACT NO. 6000H
ADDITIONAL PROVISIONS
1. The "Price" referred to in Article IV of this Agreement as well as any
Alternates, Unit Prices, hourly rates, separate prices, etc. stated in this
Agreement shall remain in full force and effect for the duration of the
Project (defined in Article I on Page 1). Also, prices established in any
subsequent Change Orders to this Agreement shall remain in full force and
effect for the same duration.
2. Subcontractor shall submit with each application for payment a sworn
statement, in quadruplicate, setting forth the names and addresses of
persons or firms who have been contracted with, or have furnished, or are
furnishing materials or labor in connection with this Subcontract
Agreement; also, showing opposite the name of each such person or firm the
kind of material furnished or general nature of work performed, amount of
contract, amount received to date, balance due and balance to become due.
If Subcontractor's material is from stock, this sworn statement should
recite that such material was taken from paid stock.
If such affidavit (sworn statement) indicates indebtedness to
sub-subcontractors and/or materialmen, Turner will require Affidavits and
Waivers of Lien from sub-contractors and/or materialmen.
3. The Subcontractor must cooperate with and participate in the job safety
program as summarized in the "Turner Safety Program". With reference to
Item 10, a low velocity power actuated tool is defined as that where the
stud or pin shall be caused to have a velocity not in excess of 300 feet
per second when measured 6-1/2 feet from the muzzle of the fastening tool.
Subcontractor is required to hold Turner harmless for any and all violation
by the Subcontractor of safety requirements in Federal Register Volume 44,
No. 29, Safety and Health Regulations for Construction.
4. Turner is a Federal Contractor and all subcontracts must conform with the
requirements of Presidential Executive Orders 11246, 11375 and all other
applicable laws, rules and regulations to ensure Equal Employment
Opportunity. Subcontractors with field labor portions of $10,000.00 or more
are required to:
A. Execute a Monthly Utilization Report - Standard Form 257 for On-site
Workforce.
B. Send a notice of non-discrimination to all applicable unions.
C. Comply to the Affirmative Action Program which provides a minimal,
acceptable level of minority and female group employment (goals) for
each and every trade and specific affirmative action steps to be
followed during performance of the contract. Trade goal on this project
is twenty-two and six tenths percent (22.6%) minority employment and
seven percent (7%) female employment. (Contractor's and subcontractor's
own workforce).
5. Subcontractor will exert best effort to achieve MBE/FBE participation.
Cont'd on Page 3B
-3A-
<PAGE> 5
CLEVELAND CLINIC FOUNDATION
HEALTH SCIENCES CENTER-PHASE 1
CLEVELAND, OHIO
CONTRACT NO. 6000H
ADDITIONAL PROVISIONS-Cont'd
6. All shanties that are pre-approved by Turner and installed by
Subcontractor, or its subcontractors, ten feet or less from the building,
shall be constructed of fireproof lumber, steel, masonry or other approved
noncombustible materials, including wire glass. If valuable materials or
extraordinary fire hazards are present, shanties installed more than ten
feet from buildings shall also be fireproof. Before installing shanties,
Turner's Superintendent must approve construction and location.
7. Subcontractor will provide an experienced Superintendent or Foreman,
familiar and experienced in work similar to the Work used on this Project
as well as this Subcontractor's trade. Turner must approve of
Subcontractor's Superintendent or Foreman. If for any reason Turner should
request a change of personnel during the course of the job, the request
will be honored immediately. Before Subcontractor replaces any
Superintendent or Foreman, approval of Turner is required.
8. Should overtime work be required through Trade Contractor's negligence
and/or inability to keep up with the pace of the Project, Trade Contractor
will be charged for added costs to provide any temporary light and power,
heat, hoisting services and other facilities during the premium time hours.
9. The Work includes any out-of-sequence work, required for the hoist bay
area. In the event out-of-sequence work is required due to temporary
facility and logistics in other areas, Subcontractor will accommodate
Turner provided this does not pose a financial constraint on Subcontractor
or schedule constraint.
10. Subcontractor is responsible for all necessary development of the Work to
fulfill the intent of the Contract Documents for a complete and/or
functioning system whether totally defined by the drawings and
specifications or not.
11. This Project has been declared tax exempt by the Owner for all materials
and labor associated with the permanent structure only in accordance with
the tax laws of the State of Ohio. Sales tax, however, will be paid by this
Trade Contractor for all materials and labor on this Project that does not
fall underneath this requirement.
12. This Subcontractor does hereby waive any rights to direct payment from the
Owner for any disputed amount or claim unless prior approved by Turner.
13. This Agreement shall be fully assignable to the Owner upon his request. It
is agreed and understood that the Owner may accept said assignment at any
time during the course of construction prior to final completion. This
assignment would be effective upon acceptance by the Owner in writing
and would accrue all rights, remedies and obligations to the Owner as are
due Turner under this Agreement.
14. The Work of this Agreement shall include, but not be limited to, all
materials, expediting labor, tools, equipment, scaffolding, shop drawings,
catalog cuts, engineering, layout work, supplies, plant, freight,
superintendence, transportation, temporary construction where required,
compliance with all agencies (City, County, State and Federal as may be
required), contributions, insurance, all taxes of any kind (excluding Ohio
State Sales Tax for permanent
Cont'd on Page 3C
- 3B -
<PAGE> 6
** Confidential treatment requested pursuant to Rule 406
CLEVELAND CLINIC FOUNDATION
HEALTH SCIENCES CENTER - PHASE 1
CLEVELAND, OHIO
CONTRACT NO. 6000H
ADDITIONAL PROVISIONS-CONT'D
construction), all other services, facilities and things necessary to
furnish and install B. P. 3A Glazed Aluminum Curtain Wall System Work in
accordance with Contract Documents listed below, with the following
clarifications:
A. Turner's Invitation to Bid dated 7/9/96.
B. Contract Documents dated 10/22/96, EXHIBIT "B" (13 pages).
C. Letter of Understanding/Project Mission Statement, EXHIBIT "C" (1
page).
D. Turner's Purchase Requisition No. 3A "Glazed Aluminum Curtain
Wall System" dated 9/12/96, EXHIBIT "D" (7 pages).
15. The Cleveland Clinic Foundation Projects have initiated a labor agreement
with all trades relative to this work. Same to be finalized by the end of
January, 1997 and will be a part of this Agreement.
16. The Subcontract Price is as follows:
<TABLE>
<S> <C>
Adjusted Base Bid **
* Add column @ bridge **
* Exterior (3 coats paint in lieu of 4) **
* Polycron paint @ interior **
* Aluminum doors in lieu of stainless steel **
* Eliminate molded corners @ interior glazing gaskets **
* Segmented Educ. Bldg. stair per SK-1 **
-------
Subtotal **
Negotiation Discount **
-------
Revised Bid **
Deduct Carnegie Bridge **
-------
SUBCONTRACT PRICE **
</TABLE>
17. The following understandings are included as part of this Subcontract
Agreement:
A. Clarification to item 10, page 5 of Purchase Requisition. Final
cleaning will be at the direction of Turner.
B. Subcontractor will furnish a parent company guarantee on a form
acceptable to Turner with the signed Agreement. This parent company
guarantee will be in effect through the warranty period.
C. Subcontractor will provide an irrevocable letter of credit in the
amount of ** to Turner to be in effect through the warranty period
of the Project.
Cont'd on Page 3D
-3C-
<PAGE> 7
CLEVELAND CLINIC FOUNDATION
HEALTH SCIENCES CENTER - PHASE 1
CLEVELAND, OHIO
CONTRACT NO. 6000H
ADDITIONAL PROVISIONS - CONT'D.
D. The curtainwall work is based on a mutually agreed upon
Subcontractor's schedule dated 12/12/96, EXHIBIT "A" (3 pages).
Since time is of the essence, Subcontractor will make every effort
so that the mock-up, window and curtainwall test will occur one
month earlier than shown on the Subcontractor's schedule dated
12/12/96.
18. The Architect has agreed on a ten (10) day door to door turn around time for
shop drawings, provided that submittals are kept to a reasonable size
package and submission is phased - Subcontractor to provide outline of shop
drawing submission at the earliest time after award to facilitate schedule.
19. The Owner, Turner and Architect will schedule work meetings associated with
the above submittals as required to facilitate the approval process. Meeting
to be scheduled either in Cleveland and/or New York at Architect's office.
20. Subcontractor requested a forty-eight (48) hour turn around time for RFI's.
Provided that the RFI's are reasonable, the Architect has agreed to meet
this time frame. The forty-eight (48) hours to be work days only.
21. Subcontractor will review possibility of awarding the materials (aluminum)
extrusion work to more then one manufacture to enhance schedule outcome and
advise Turner if this is viable and beneficial to Project outcome.
22. Subcontractor is advised that Turner will employ an on-site exterior wall
consultant (CDC) to periodically inspect and review shop drawings and
on-site Work. Subcontractor agrees to afford the consultant reasonable time
and access to all phases of this operation provided there is no delay to
Subcontractor's schedule.
23. In addition to the indemnification required in Article XXIII of the
Agreement, Subcontractor shall further hold Turner and the Owner harmless to
the same degree for claims arising out of the Subcontractor's errors and
omissions in the exterior wall design documents. Subcontractor shall provide
to Turner evidence of product liability coverage in a least $5 million.
Continuing evidence of the renewal of such coverage on its anniversary date
must be provided, up to and until such date as legal actions may no longer
be brought in accordance with applicable statutes.
24. Warranty for the Work is per item 13, page 5 of Purchase Requisition.
25. Subcontractor will engineer, fabricate and install the entire aluminum and
curtain wall system. Subcontracting any portion of this scope other than
manufacturing of the aluminum extrusions and supply of glass, will not be
permitted without the expressed approval by Turner. In the event
subcontracting any portion of the Work could be beneficial to the Project
outcome, Subcontractor must seek written approval from Turner indicating
specific benefit.
Cont'd on Page 3E
-3D-
<PAGE> 8
CLEVELAND CLINIC FOUNDATION
HEALTH SCIENCES CENTER - PHASE 1
CLEVELAND, OHIO
CONTRACT NO. 6000H
ADDITIONAL PROVISIONS - Cont'd
26. Subcontractor will work with other curtainwall trade contractors, i.e.,
stone work and support and precast work to coordinate shop drawing
activities to minimize any problems, to allow for a smooth transition
between each system.
27. Subcontractor will continually review and update the 12/12/96 schedule to
enhance activities for the benefit of the Project, specifically as it
relates to shop drawings, securing materials, fabrication, delivery for
mock-up, delivery to jobsite and field installation of system on site.
28. All deliveries to jobsite and jobsite storage will be coordinated with
Turner's Project Superintendent.
29. Any material damaged during shipment will be replaced as expeditiously as
practical to the Project site to minimize out-of-sequence work activities.
30. Subcontractor has committed to staff the Project and supervise all levels
of this operation with qualified personnel meeting the approval of Turner
and the Owner. A staffing chart will be submitted by Subcontractor for
Turner's concurrence. Any change to assigned staff, once approved by
Turner, must be approved by Turner.
31. The quality level of any accepted alternates will be similar to the level
of the original material specified. Subcontractor is aware and understands
the Architect's quality level intent of the Project.
32. Subcontractor understands that Contract Documents do not indicate in depth
details which may be required to build a complete system. Subcontractor has
taken these items under full consideration and fulfilled the full intent
for a complete system.
33. Subcontractor's acceptance of the expressed conditions precedent for
payment terms is conditional on the understanding that: in the event Owner
withholds progress and/or final payment, due to no fault of Subcontractor's
work, Turner will immediately reformat requisition for payment in such
fashion as to segregate monies due Subcontractor and follow for receipt of
funds from the Owner for timely payment to Subcontractor.
-3E-
<PAGE> 9
** Confidential treatment requested pursuant to Rule 406
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
FLOUR CITY ARCHITECTURAL METALS PRELIMINARY JOB SCHEDULE FOR TURNER CONSTRUCTION
- -----------------------------------------------------------------------------------------------------------------------------------
ID Task Name Duration Start Finish
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
43 Scheduling Assumptions: ** ** ** ** :
- -------------------------------------------------------------------------------
44 1. two wk total appr'l turn
around on all submittals ** ** ** ** :
- -------------------------------------------------------------------------------
45 2. approved or approved as
noted after 1st ** ** ** ** :
- -------------------------------------------------------------------------------
46 submittal to release
material production ** ** ** ** :
- -------------------------------------------------------------------------------
47 3. 2nd subm for record only ** ** ** ** :
- -------------------------------------------------------------------------------
48 4. RFI response within 48 hours ** ** ** ** :
- -------------------------------------------------------------------------------
49 5. no changes to contract docs ** ** ** ** :
- -------------------------------------------------------------------------------
50 6. schedule for trellises,
soffits, canopies, ** ** ** ** :
- -------------------------------------------------------------------------------
51 doors, stacks & vestibules
will be ** ** ** ** :
- -------------------------------------------------------------------------------
52 provided separately. ** ** ** ** :
- -------------------------------------------------------------------------------
53 7. streets to be closed
for crane setting (2) ** ** ** ** :
- -------------------------------------------------------------------------------
54 8. sequence of bldgs per TCCO
request ** ** ** ** :
- -------------------------------------------------------------------------------
55 9. TCCO provide Architect
Autocad files to ** ** ** ** :
- -------------------------------------------------------------------------------
56 FCAM by December 18, 1996 ** ** ** ** :
- -------------------------------------------------------------------------------
57 10. shape/design approval of
windows & ** ** ** ** :
- -------------------------------------------------------------------------------
58 curtain wall for job by
early-mid Jan 1997 ** ** ** ** :
- -------------------------------------------------------------------------------
59 11. the entire building structures
shall be ready ** ** ** ** :
- -------------------------------------------------------------------------------
60 for FCAM work to commence
as follows: ** ** ** ** :
- -------------------------------------------------------------------------------
61 BME Sep 1, 1997;
Education Oct 1, 1997; & ** ** ** ** :
- -------------------------------------------------------------------------------
62 Research Dec 1, 1997. ** ** ** ** :
- -------------------------------------------------------------------------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
FLOUR CITY ARCHITECTURAL METALS PRELIMINARY JOB SCHEDULE FOR TURNER CONSTRUCTION
- -------------------------------------------------------------------------------------------------------------------
ID Task Name Duration Start Finish
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
43 Scheduling Assumptions: ** ** ** ** :
- -------------------------------------------------------------------------------
44 1. two wk total appr'l turn
around on all submittals ** ** ** ** :
- -------------------------------------------------------------------------------
45 2. approved or approved as
noted after 1st ** ** ** ** :
- -------------------------------------------------------------------------------
46 submittal to release
material production ** ** ** ** :
- -------------------------------------------------------------------------------
47 3. 2nd subm for record only ** ** ** ** :
- -------------------------------------------------------------------------------
48 4. RFI response within 48 hours ** ** ** ** :
- -------------------------------------------------------------------------------
49 5. no changes to contract docs ** ** ** ** :
- -------------------------------------------------------------------------------
50 6. schedule for trellises,
soffits, canopies, ** ** ** ** :
- -------------------------------------------------------------------------------
51 doors, stacks & vestibules
will be ** ** ** ** :
- -------------------------------------------------------------------------------
52 provided separately. ** ** ** ** :
- -------------------------------------------------------------------------------
53 7. streets to be closed
for crane setting (2) ** ** ** ** :
- -------------------------------------------------------------------------------
54 8. sequence of bldgs per TCCO
request ** ** ** ** :
- -------------------------------------------------------------------------------
55 9. TCCO provide Architect
Autocad files to ** ** ** ** :
- -------------------------------------------------------------------------------
56 FCAM by December 18, 1996 ** ** ** ** :
- -------------------------------------------------------------------------------
57 10. shape/design approval of
windows & ** ** ** ** :
- -------------------------------------------------------------------------------
58 curtain wall for job by
early-mid Jan 1997 ** ** ** ** :
- -------------------------------------------------------------------------------
59 11. the entire building structures
shall be ready ** ** ** ** :
- -------------------------------------------------------------------------------
60 for FCAM work to commence
as follows: ** ** ** ** :
- -------------------------------------------------------------------------------
61 BME Sep 1, 1997;
Education Oct 1, 1997; & ** ** ** ** :
- -------------------------------------------------------------------------------
62 Research Dec 1, 1997. ** ** ** ** :
- -------------------------------------------------------------------------------
</TABLE>
Project: CLEVELAND CLINIC Task Summary Rolled Up Progress
Date: Thu 12/12/96 Progress Rolled Up Task
Milestone Rolled Up Milestone
- --------------------------------------------------------------------------------
Page 3
- --------------------------------------------------------------------------------
<PAGE> 10
** Confidential treatment requested pursuant to Rule 406
<TABLE>
- -----------------------------------------------------------------------------------------------------------
<CAPTION>
FLOUR CITY ARCHITECTURAL METALS PRELIMINARY JOB SCHEDULE FOR TURNER CONSTRUCTION
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ID Task Name Duration Start Finish
- ------------------------------------------------------------------------------------------
23 EDUCATION BLDG WINDOWS & C. WALL ** ** **
24 shop drwgs, prepare & 1st subm ** ** **
25 shop drwgs, approve & return ** ** **
26 shop drwgs, submit for record ** ** **
27 material production ** ** **
28 unit assembly ** ** **
29 field work, pre-unit installation ** ** **
30 unit installation ** ** **
31 caulking & trim ** ** **
32
33 RESEARCH BLDG WINDOWS & C. WALL ** ** **
34 shop drwgs, prepare & 1st subm ** ** **
35 shop drwgs, approve & return ** ** **
36 shop drwgs, submit for record ** ** **
37 material production ** ** **
38 unit assembly ** ** **
39 field work, pre-unit installation ** ** **
40 unit installation ** ** **
41 caulking & trim ** ** **
42
<CAPTION>
FLOUR CITY ARCHITECTURAL METALS PRELIMINARY JOB SCHEDULE FOR TURNER CONSTRUCTION
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
ID Task Name ** ** ** ** ** ** **
- ------------------------------------------------------------------------------------------------------------------------------------
23 EDUCATION BLDG WINDOWS & C. WALL
24 shop drwgs, prepare & 1st subm
25 shop drwgs, approve & return
26 shop drwgs, submit for record
27 material production
28 unit assembly
29 field work, pre-unit installation
30 unit installation
31 caulking & trim
32
33 RESEARCH BLDG WINDOWS & C. WALL
34 shop drwgs, prepare & 1st subm
35 shop drwgs, approve & return
36 shop drwgs, submit for record
37 material production
38 unit assembly
39 field work, pre-unit installation
40 unit installation
41 caulking & trim
42
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Project: CLEVELAND CLINIC
Date: Thu 12/12/98
- -------------------------------------------------------------------------------
Task Summary Rolled Up Progress
Progress Rolled Up Task
Milestone Rolled Up Milestone
- -------------------------------------------------------------------------------
Page 2
- -------------------------------------------------------------------------------
<PAGE> 11
** Confidential treatment requested pursuant to Rule 406
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
FLOUR CITY ARCHITECTURAL METALS PRELIMINARY JOB SCHEDULE FOR TURNER CONSTRUCTION
- ---------------------------------------------------------------------------------------------------------------------------------
0 Task Name Duration Start Finish
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1 CURTAIN WALL WORK ** ** **
2 SUBCONTRACT AWARD ** ** **
3
4 MOCKUP, WINDOW & CURTAIN WALL ** ** **
5 shop drwgs, prepare & 1st subm ** ** **
6 shop drwgs, approve & return ** ** **
7 shop drwgs, submit for record ** ** **
8 material production ** ** **
9 unit assembly ** ** **
10 ship/erect/pretest ** ** **
11 test ** ** **
12
13 BME BUILDING WINDOWS & C. WALL ** ** **
14 shop drwgs, prepare & 1st subm ** ** **
15 shop drwgs, approve & return ** ** **
16 shop drwgs, submit for record ** ** **
17 material production ** ** **
18 unit assembly ** ** **
19 field work, pre-unit installation ** ** **
20 unit installation ** ** **
21 caulking & trim ** ** **
22
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
Project: CLEVELAND CLINIC Task Summary Rolled Up Programs
Date: Thu 12/12/96 Programs Rolled Up Task
Milestone Rolled Up Milestone
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 1
- ------------------------------------------------------------------------------
<PAGE> 12
- -------------------------------------------------------------------------------
Current Construction Document List CCF Health Sciences Center
22-Oct-96 Turner Constructions Co. 6000H
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Title Revised Date Noted
- ----------------------------------------------------------------------------------------------
Drawings
Architectural
<S> <C> <C> <C>
A-0000 Cover Sheet 10/14/96 Clean-up Set (CE-07)
A-0001 Drawing Index 10/14/96 Clean-up Set (CE-07)
A-0002 Symbols/Abbreviations 10/14/96 Clean-up Set (CE-07)
A-0003 Egress Plans 10/14/96 Clean-up Set (CE-07)
A-0100 Basement Level Floor Plan 10/14/96 Clean-up Set (CE-07)
A-0101 First Level Floor Plan 10/14/96 Clean-up Set (CE-07)
A-0102 Second Level Floor Plan 10/14/96 Clean-up Set (CE-07)
A-0103 Third Level Floor Plan 10/14/96 Clean-up Set (CE-07)
A-0104 Fourth Level Floor Plan 10/14/96 Clean-up Set (CE-07)
A-0105 Fifth Level Floor Plan 10/14/96 Clean-up Set (CE-07)
A-0106 Penthouse Plan 10/14/96 Clean-up Set (CE-07)
A-0107 Roof Plan 10/14/96 Clean-up Set (CE-07)
A-0210 Basement Plan-Education Wing 10/14/96 Clean-up Set (CE-07)
A-0211 First Level Floor Plan-Education Wing 10/14/96 Clean-up Set (CE-07)
A-0212 Second Level Floor Plan-Education Wing 10/14/96 Clean-up Set (CE-07)
A-0213 Third Level Floor Plan-Education Wing 10/14/96 Clean-up Set (CE-07)
A-0213i Third & Fourth Level Interstitial-Education 10/14/96 Clean-up Set (CE-07)
A-0214 Fourth Level Floor Plan-Education Wing 10/14/96 Clean-up Set (CE-07)
A-0215 Fifth Level Floor Plan-Education Wing 10/14/96 Clean-up Set (CE-07)
A-0220 Basement Plan-Research Wing 10/14/96 Clean-up Set (CE-07)
A-0221 First Level Floor Plan-Research Wing 10/14/96 Clean-up Set (CE-07)
A-0222 Second Level Floor Plan-Research Wing 9/13/96 Clean-up Set (CE-07)
A-0223 Third Level Floor Plan-Research Wing 10/14/96 Clean-up Set (CE-07)
A-0224 Fourth Level Floor Plan-Research Wing 10/14/96 Clean-up Set (CE-07)
A-0225 Fifth Level Floor Plan-Research Wing 10/14/96 Clean-up Set (CE-07)
A-0226 Mechanical Equipment Level Floor Plan 10/14/96 Clean-up Set (CE-07)
A-0310 RCP-Basement-Education Wing 10/14/96 Clean-up Set (CE-07)
A-0311 RCP-First Level-Education Wing 10/14/96 Clean-up Set (CE-07)
A-0312 RCP-Second Level-Education Wing 10/14/96 Clean-up Set (CE-07)
A-0313 RCP-Third Level-Education Wing 10/14/96 Clean-up Set (CE-07)
A-0314 RCP-Fourth Level-Education Wing 10/14/96 Clean-up Set (CE-07)
A-0315 RCP-Fifth Level-Education Wing 10/14/96 Clean-up Set (CE-07)
A-0320 RCP-Basement-Research Wing 10/14/96 Clean-up Set (CE-07)
A-0321 RCP-First Level-Research Wing 10/14/96 Clean-up Set (CE-07)
A-0322 RCP-Second Level-Research Wing 9/13/96 Clean-up Set (CE-07)
A-0323 RCP-Third Level-Research Wing 10/14/96 Clean-up Set (CE-07)
A-0324 RCP-Fourth Level-Research Wing 10/14/96 Clean-up Set (CE-07)
A-0325 RCP-Fifth Level-Research Wing 10/14/96 Clean-up Set (CE-07)
A-0400 Education Wing Atrium Core 10/14/96 Clean-up Set (CE-07)
A-0410 Education Wing Atrium Grand Stair 10/14/96 Clean-up Set (CE-07)
A-0411 Education Wing Atrium Grand Stair Details 10/14/96 Clean-up Set (CE-07)
A-0420 Research Lobby Core 10/14/96 Clean-up Set (CE-07)
</TABLE>
- -------------------------------------------------------------------------------
EXHIBIT "B" Page 1 of 13
<PAGE> 13
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
Number Title Revised Date Noted
- -----------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
A-0421 Elevator Shaft Details 10/14/96 Clean-up Set (CE-07)
A-0440 Service Core - Plans and Details - Education 10/14/96 Clean-up Set (CE-07)
A-0450 Service Stair - Plans and Details - Research 10/14/96 Clean-up Set (CE-07)
A-0452 Misc. Stair Details 10/14/96 Clean-up Set (CE-07)
A-0453 Misc. Interior Details 10/14/96 Clean-up Set (CE-07)
A-0454 Data Core - Plans & Sections - Research 10/14/96 Clean-up Set (CE-07)
A-0460 East 100th Street Bridge Plans 10/14/96 Clean-up Set (CE-07)
A-0461 East 100th Street Bridge Elevations/Sections 10/14/96 Clean-up Set (CE-07)
A-0462 East 100th Street Bridge Details 10/14/96 Clean-up Set (CE-07)
A-0463 East 100th Street Bridge Details 10/14/96 Clean-up Set (CE-07)
A-0464 East 100th Street Bridge Details 10/14/96 Clean-up Set (CE-07)
A-0470 NC Building Connection 10/14/96 Clean-up Set (CE-07)
A-0500 5th Floor Raked Classroom - Education Wing 10/14/96 Clean-up Set (CE-07)
A-0510 First Floor Classroom/Seminar - Education Wing 10/14/96 Clean-up Set (CE-07)
A-0520 Fourth Floor Classroom - Education Wing 10/14/96 Clean-up Set (CE-07)
A-0530 Fifth Floor Classroom - Education Wing 10/14/96 Clean-up Set (CE-07)
A-0550 Fifth Floor Misc. Rooms - Education Wing 10/14/96 Clean-up Set (CE-07)
A-0560 Toilet Room - Plans 10/14/96 Clean-up Set (CE-07)
A-0561 Toilet Room - Elevations 10/14/96 Clean-up Set (CE-07)
A-0562 Toilet Room - Elevations 10/14/96 Clean-up Set (CE-07)
A-0570 Photography Department Plan 10/14/96 Clean-up Set (CE-07)
A-0571 Photography Department Elevations 10/14/96 Clean-up Set (CE-07)
A-0580 Research Entry 10/14/96 Clean-up Set (CE-07)
A-0600 Interior Elevations - Education/Research Corridors 10/14/96 Clean-up Set (CE-07)
A-0610 Interior Elevations & Plans - Commons 10/14/96 Clean-up Set (CE-07)
A-0620 Interior Elevations - Commons 10/14/96 Clean-up Set (CE-07)
A-0630 Rail Details - Commons 10/14/96 Clean-up Set (CE-07)
A-0635 Research Wing Elevations & Details - Commons 10/14/96 Clean-up Set (CE-07)
A-0640 Educ. Lvls 2,3, & 4 Interior Elevations 10/14/96 Clean-up Set (CE-07)
A-0650 Interior Elevations - Library Third Floor 10/14/96 Clean-up Set (CE-07)
A-0660 Interior Elevations - Library Stair 10/14/96 Clean-up Set (CE-07)
A-0661 Library Stair & Guard Rail Details 10/14/96 Clean-up Set (CE-07)
A-0700 Building Section/Elevations 10/14/96 Clean-up Set (CE-07)
A-0710 Building Elevations 10/14/96 Clean-up Set (CE-07)
A-0720 Building Elevations 10/14/96 Clean-up Set (CE-07)
A-0800 Building Section: North/South Education 10/14/96 Clean-up Set (CE-07)
A-0810 Building Section: Atrium With Bridge 10/14/96 Clean-up Set (CE-07)
A-0820 Building Section: Atrium and Library Stair 10/14/96 Clean-up Set (CE-07)
A-0830 Building Section: East/West Education 10/14/96 Clean-up Set (CE-07)
A-0840 Building Section: East/West Research 10/14/96 Clean-up Set (CE-07)
A-0850 Building Section: East End/Research 10/14/96 Clean-up Set (CE-07)
A-0860 Building Section: Research Lobby/Shaft 10/14/96 Clean-up Set (CE-07)
A-0870 Building Section: Commons/West End 10/14/96 Clean-up Set (CE-07)
A-0900 Detailed Building Elevations: Education Wing 10/14/96 Clean-up Set (CE-07)
A-0910 Detailed Building Elevations: Atrium 10/14/96 Clean-up Set (CE-07)
A-0920 Detailed Building Elevations: Education Wing 10/14/96 Clean-up Set (CE-07)
A-0930 Detailed Building Elevations: Education Wing 10/14/96 Clean-up Set (CE-07)
A-0940 Detailed Building Elevations: Research & Ed. Wings 10/14/96 Clean-up Set (CE-07)
A-0950 Detailed Building Elevations: Research Wing 10/14/96 Clean-up Set (CE-07)
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</TABLE>
<PAGE> 14
<TABLE>
<CAPTION>
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Number Title Revised Date Noted
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
A-0980 Detailed Building Elevations: Research Wing 10/14/96 Clean-up Set (CE-07)
A-0990 Detail Elevation - Typical Exterior Truss Wall 10/14/96 Clean-up Set (CE-07)
A-1000 Wall Sections - Education Wing 10/14/96 Clean-up Set (CE-07)
A-1010 Wall Sections - Education Wing 10/14/96 Clean-up Set (CE-07)
A-1020 Wall Sections - Research Wing 10/14/96 Clean-up Set (CE-07)
A-1030 Wall Sections - Research Wing 10/14/96 Clean-up Set (CE-07)
A-1060 Plan & Section - Trellis/Terrace 10/14/96 Clean-up Set (CE-07)
A-1110 Exterior Wall Plan Details - Education Wing 10/14/96 Clean-up Set (CE-07)
A-1120 Exterior Wall Plan Details - Research Wing 10/14/96 Clean-up Set (CE-07)
A-1130 Exterior Wall Plan Details - Education/Research Wing 10/14/96 Clean-up Set (CE-07)
A-1131 Exterior Wall Plan Details - Education/Research Wing 10/14/96 Clean-up Set (CE-07)
A-1132 Expansion Joint - Educ/Research @ Roof 10/14/96 Clean-up Set (CE-07)
A-1140 Exterior Wall Plan Details - Misc. Curtainwall 10/14/96 Clean-up Set (CE-07)
A-1150 Exterior Wall Section Details - Typical Wall 7/10/96 Clean-up Set (CE-07)
A-1160 Exterior Wall Section Details - Curtainwall & Drum 10/14/96 Clean-up Set (CE-07)
A-1161 Exterior Wall Section Details - Curtain Wall 10/14/96 Clean-up Set (CE-07)
A-1170 Terrace/Trellis Details 10/14/96 Clean-up Set (CE-07)
A-1171 Door Sill Details 10/14/96 Clean-up Set (CE-07)
A-1180 Ext. Wall Section Details 10/14/96 Clean-up Set (CE-07)
A-1190 Typical Parapet Details 10/14/96 Clean-up Set (CE-07)
A-1191 Exterior Wall Details 10/14/96 Clean-up Set (CE-07)
A-1192 Expansion Joint Details 10/14/96 Clean-up Set (CE-07)
A-1193 Exhaust Stack Details 10/14/96 Clean-up Set (CE-07)
A-1194 Roof Drain Details 10/14/96 Clean-up Set (CE-07)
A-1195 Misc. Roof Details 10/14/96 Clean-up Set (CE-07)
A-1200 Millwork Details 10/14/96 Clean-up Set (CE-07)
A-1210 Millwork Details - Raked Classroom 10/14/96 Clean-up Set (CE-07)
A-1211 Millwork Details 10/14/96 Clean-up Set (CE-07)
A-1212 Millwork Details - First Floor Classrooms 10/14/96 Clean-up Set (CE-07)
A-1213 Millwork Details 10/14/96 Clean-up Set (CE-07)
A-1220 Millwork Details 10/14/96 Clean-up Set (CE-07)
A-1221 Millwork Details 10/14/96 Clean-up Set (CE-07)
A-1222 Millwork Details 10/14/96 Clean-up Set (CE-07)
A-1223 Millwork Details - 3rd Floor Library Service Desk 10/14/96 Clean-up Set (CE-07)
A-1224 Millwork Details - 4th Floor Library Service Desk 10/14/96 Clean-up Set (CE-07)
A-1225 Millwork Details 10/14/96 Clean-up Set (CE-07)
A-1226 Millwork Details 10/14/96 Clean-up Set (CE-07)
A-1230 Interior Details 10/14/96 Clean-up Set (CE-07)
A-1231 Misc. Interior Details 10/14/96 Clean-up Set (CE-07)
A-1232 Misc. Interior Details - 1st Floor 10/14/96 Clean-up Set (CE-07)
A-1233 Misc. Interior Details - 2nd Floor 10/14/96 Clean-up Set (CE-07)
A-1234 Misc. Interior Details - 3rd Floor 10/14/96 Clean-up Set (CE-07)
A-1235 Misc. Interior Details - 4th Floor 10/14/96 Clean-up Set (CE-07)
A-1238 Misc. Interior Details - 5th Floor 10/14/96 Clean-up Set (CE-07)
A-1240 Interior Wall Sections - Education Wing 10/14/96 Clean-up Set (CE-07)
A-1241 Interior Wall Sections - Education Wing 10/14/96 Clean-up Set (CE-07)
A-1242 Interior Wall Sections - Education Wing 10/14/96 Clean-up Set (CE-07)
A-1250 Ceiling Details 10/14/96 Clean-up Set (CE-07)
A-1251 Ceiling Details 10/14/96 Clean-up Set (CE-07)
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</TABLE>
<PAGE> 15
<TABLE>
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<CAPTION>
Number Title Revised Date Noted
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
A-1252 Ceiling Details 7/31/96 Clean-up Set (CE-07)
A-1253 Research First & Second Floor RCP Details 10/14/96 Clean-up Set (CE-07)
A-1254 Research First & Second Floor RCP Details 10/14/96 Clean-up Set (CE-07)
A-1300 Ribbon Window Details 10/14/96 Clean-up Set (CE-07)
A-1310 Curtainwall Drum Misc. Details 10/14/96 Clean-up Set (CE-07)
A-1320 Curtainwall @ Atrium Details 10/14/96 Clean-up Set (CE-07)
A-1340 Isonometric @ Ribbon Window 10/14/96 Clean-up Set (CE-07)
A-1350 Isonometric @ Curtainwall 10/14/96 Clean-up Set (CE-07)
A-1400 Door Schedule 10/14/96 Clean-up Set (CE-07)
A-1410 Door & Frame Types 10/14/96 Clean-up Set (CE-07)
A-1420 Door & Frame Details 10/14/96 Clean-up Set (CE-07)
A-1430 Misc. Door Details 10/14/96 Clean-up Set (CE-07)
A-1500 Partition Types 10/14/96 Clean-up Set (CE-07)
A-B0002 BME Building Context Plan & Drwg. List 8/2/96 Addendum No. 2
A-B0230 BME/Biostat - Basement 10/14/96 Clean-up Set (CE-07)
A-B0231 BME/Biostat - First Floor 10/14/96 Clean-up Set (CE-07)
A-B0232 BME/Biostat - Second Floor 10/14/96 Clean-up Set (CE-07)
A-B0233 BME/Biostat - Third Floor 10/14/96 Clean-up Set (CE-07)
A-B0233 BME/Biostat - Third Floor/Interstitial 10/14/96 Clean-up Set (CE-07)
A-B0234 BME/Biostat - Fourth Floor 10/14/96 Clean-up Set (CE-07)
A-B0234 BME/Biostat - Fourth Floor/Interstitial 10/14/96 Clean-up Set (CE-07)
A-B0235 BME/Biostat - Fifth Floor 10/14/96 Clean-up Set (CE-07)
A-B0235 BME/Biostat - Fifth Floor/Interstitial 10/14/96 Clean-up Set (CE-07)
A-B0236 BME/Biostat - Penthouse 10/14/96 Clean-up Set (CE-07)
A-B0237 BME/Biostat - Roof Plan 10/14/96 Clean-up Set (CE-07)
A-B0400 BME/Core Plans 10/14/96 Clean-up Set (CE-07)
A-B0401 BME/Core Plans 10/14/96 Clean-up Set (CE-07)
A-B0402 BME/Core Sections 10/14/96 Clean-up Set (CE-07)
A-B0403 BME/Atrium Stair Sections 10/14/96 Clean-up Set (CE-07)
A-B0410 BME/Core Plans 10/14/96 Clean-up Set (CE-07)
A-B0411 BME/Core Plans 10/14/96 Clean-up Set (CE-07)
A-B0420 BME/Stair Plans 10/14/96 Clean-up Set (CE-07)
A-B0470 Pedestrian Bridge Plans & Elevations 10/14/96 Clean-up Set (CE-07)
A-B0471 Pedestrian Bridge Details 10/14/96 Clean-up Set (CE-07)
A-B0472 Pedestrian Bridge Details 10/14/96 Clean-up Set (CE-07)
A-B0473 Pedestrian Bridge Details 10/14/96 Clean-up Set (CE-07)
A-B0480 Demo & Scope of Work - Sherwin Entry 8/2/96 Addendum No. 2
A-B0481 Demo Plan @ Sherwin Entry - Structural 8/2/96 Addendum No. 2
A-B0490 Demo & Scope of Work @ Lab Med Bldg 8/2/96 Addendum No. 2
A-B0491 96th Street Bridge - Plans/Sections/Elevations 10/14/96 Clean-up Set (CE-07)
A-B0610 BME/Interior Elev. @ Atrium 10/14/96 Clean-up Set (CE-07)
A-B0700 Elevations 10/14/96 Clean-up Set (CE-07)
A-B0750 BME/West Elevation 10/14/96 Clean-up Set (CE-07)
A-B0760 BME/East Elevation 10/14/96 Clean-up Set (CE-07)
A-B0770 BME/North & South Elevations 10/14/96 Clean-up Set (CE-07)
A-B0800 BME/North & South Sections 10/14/96 Clean-up Set (CE-07)
A-B0810 BME/East & West Sections 10/14/96 Clean-up Set (CE-07)
A-B0820 BME/East & West Sections 10/14/96 Clean-up Set (CE-07)
A-B0830 BME/Atrium & 96th St. Bridge Section 10/14/96 Clean-up Set (CE-07)
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</TABLE>
<PAGE> 16
<TABLE>
<CAPTION>
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Number Title Revised Date Noted
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
A-B0900 BME/West Elevation Details 10/14/96 Clean-up Set (CE-07)
A-B0910 BME/East Elevation Details 10/14/96 Clean-up Set (CE-07)
A-B0920 BME/North & South Elevation Details 10/14/96 Clean-up Set (CE-07)
A-B1000 BME/Wall Sections 10/14/96 Clean-up Set (CE-07)
A-B1010 BME/Wall Sections 10/14/96 Clean-up Set (CE-07)
A-B1020 BME/Wall Sections 10/14/96 Clean-up Set (CE-07)
A-B1030 BME/Wall Sections 10/14/96 Clean-up Set (CE-07)
A-B1050 BME/Wall Section Details 10/14/96 Clean-up Set (CE-07)
A-B1100 BME Building Plan Details 10/14/96 Clean-up Set (CE-07)
A-B1101 BME Plan Details - Floor 1 10/14/96 Clean-up Set (CE-07)
A-B1102 BME Plan Details - Floor 2, 3, & 4 10/14/96 Clean-up Set (CE-07)
A-B1109 BME Plan Details 10/14/96 Clean-up Set (CE-07)
A-B1110 Seismic Joint - BME/Research Details 10/14/96 Clean-up Set (CE-07)
A-B1111 Seismic Joint - BME/Research Details 10/14/96 Clean-up Set (CE-07)
A-B1112 Seismic Joint - BME/Research Details 10/14/96 Clean-up Set (CE-07)
Audio Visual
AV-1 Audiovisual Systems Conduit Plans 6/17/96 GMP Bid Set
AV-2 Audiovisual Systems Diagrams & Details - 1 6/17/96 GMP Bid Set
AV-3 Audiovisual Systems Diagrams & Details - 2 6/17/96 GMP Bid Set
AV-4 Audiovisual Systems Details 6/17/96 GMP Bid Set
Civil
C-100 Demolition Plan 6/17/96 GMP Bid Set
C-101 Layout Plan 6/17/96 GMP Bid Set
C-102 Paving Plan 6/17/96 GMP Bid Set
C-103 Grading Plan 6/17/96 GMP Bid Set
C-104 Storm Sewer Plan 6/17/96 GMP Bid Set
C-105 Site Details 6/17/96 GMP Bid Set
SP-000 Existing Survey 6/17/96 GMP Bid Set
Electrical
E-001 Symbol Legend 10/11/96 Clean-up Set (CE-07)
E-002 Lighting Fixture Schedule 10/11/96 Clean-up Set (CE-07)
E-100 Site Electrical Plan 10/11/96 Clean-up Set (CE-07)
E-106 Roof Plans - Lightning Protection 10/11/96 Clean-up Set (CE-07)
E-208 Bamnt Electrical Connection Plan - Exist. NC Bldg 10/11/96 Clean-up Set (CE-07)
E-210 Basement Power Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-211 First Level Power Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-212 Second Level Power Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-213 Third Level Power Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-213i Third & Fourth Lvl Interstitial Power Plans - Educ. 10/11/96 Clean-up Set (CE-07)
E-214 Fourth Level Power Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-215 Fifth Level Power Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-220a Basement Power Plan Area A - Research Wing 10/11/96 Clean-up Set (CE-07)
E-220b Basement Power Plan Area B - Research Wing 10/11/96 Clean-up Set (CE-07)
E-221a First Level Power Plan Area A - Research Wing 10/11/96 Clean-up Set (CE-07)
E-221b First Level Power Plan Area B - Research Wing 10/11/96 Clean-up Set (CE-07)
E-222a Second Level Power Plan Area A - Research Wing 10/11/96 Clean-up Set (CE-07)
E-222b Second Level Power Plan Area B - Research Wing 10/11/96 Clean-up Set (CE-07)
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</TABLE>
<PAGE> 17
<TABLE>
<CAPTION>
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Number Title Revised Date Noted
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
E-223a Third Level Power Plan Area A - Research Wing 10/11/96 Clean-up Set (CE-07)
E-223b Third Level Power Plan Area B - Research Wing 10/11/96 Clean-up Set (CE-07)
E-223l Third Level Interstitial Power & Communications 10/11/96 Clean-up Set (CE-07)
E-224a Fourth Level Power Plan Area A - Research Wing 10/11/96 Clean-up Set (CE-07)
E-224b Fourth Level Power Plan Area B - Research Wing 10/11/96 Clean-up Set (CE-07)
E-224l Fourth Level Interstitial Power & Communications 10/11/96 Clean-up Set (CE-07)
E-225 Fifth Level Shelf Space Power Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-226a Penthouse Level Power Plan Area A - Research Wing 10/11/96 Clean-up Set (CE-07)
E-226b Penthouse Level Power Plan Area B - Research Wing 10/11/96 Clean-up Set (CE-07)
E-230 Basement Power Plan - BME/Biostat Wing 10/11/96 Clean-up Set (CE-07)
E-223i Third Level Inter. Power Plan - BME/Biostat Wing 10/11/96 Clean-up Set (CE-07)
E-235 Fifth Level Power Plan - BME/Biostat Wing 10/11/96 Clean-up Set (CE-07)
E-236 Roof Power Plan - BME/Biostat Wing 10/11/96 Clean-up Set (CE-07)
E-310 Basement Lighting Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-311 First Level Lighting Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-312 Second Level Lighting Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-313 Third Level Lighting Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-313i Third & Fourth Lvl. Interstitial Lighting Plan 10/11/96 Clean-up Set (CE-07)
E-314 Fourth Level Lighting Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-315 Fifth Level Lighting Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-320 Basement Lighting Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-321 First Level Lighting Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-322 Second Level Lighting Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-323 Third Level Lighting Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-323l Third Level Inter. Lighting Plans - Research Wing 10/11/96 Clean-up Set (CE-07)
E-324 Fourth Level Lighting Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-324i Fourth Level Inter. Lighting Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-325 Fifth Level Lighting Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-326 Penthouse Lighting Plan - Educ. & Research 10/11/96 Clean-up Set (CE-07)
E-330 Basement Lighting Plan - BME/Biostat Wing 10/11/96 Clean-up Set (CE-07)
E-333l Third-Lvl. Interstitial Lighting Plan - BME/Biostat Wing 10/11/96 Clean-up Set (CE-07)
E-335 Fifth Level Lighting Plan - BME/Biostat Wing 10/11/96 Clean-up Set (CE-07)
E-410 Basement Signal & Comm. Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-411 First Level Signal & Comm. Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-412 Second Level Signal & Comm. Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-413 Third Level Signal & Comm. Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-413l Third & Fourth Lvl. Interstitial Signal & Comm. 10/11/96 Clean-up Set (CE-07)
E-414 Fourth Level Signal & Comm. Plan - Education Wing 10/11/96 Clean-up Set (CE-07)
E-415 Fifth Level Signal & Comm. Plan -Education Wing 10/11/96 Clean-up Set (CE-07)
E-420 Basement Signal & Comm. Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-421 First Level Signal & Comm. Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-422 Second Level Signal & Comm. Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-423 Third Level Signal & Comm. Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-423l Third Lvl. Interstitial Signal & Comm. - Research 10/11/96 Clean-up Set (CE-07)
E-424 Fourth Level Signal & Comm. Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-424l Fourth Lvl. Interstitial Signal & Comm. - Research 10/11/96 Clean-up Set (CE-07)
E-425 Fifth Level Signal & Comm. Plan - Research Wing 10/11/96 Clean-up Set (CE-07)
E-426 Penthouse Signal & Comm. Plan - Educ./Research 10/11/96 Clean-up Set (CE-07)
E-430 Basement Signal & Comm. Plan - BME/Biostat Wing 10/11/96 Clean-up Set (CE-07)
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</TABLE>
<PAGE> 18
<TABLE>
<CAPTION>
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<S> <C> <C> <C>
Number Title Revised Date Noted
- ---------------------------------------------------------------------------------------------------------------------
E-4331 Third Lvl. Interstitial Signal & Comm. - BME 10/11/96 Clean-up Set (CE-07)
E-435 Fifth Level Signal & Comm. Plan - BME/Biostat Wing 10/11/96 Clean-up Set (CE-07)
E-501 Electrical Construction Details 10/11/96 Clean-up Set (CE-07)
E-601 Panelboard Sched. - Basement Level - Research Wing 10/11/96 Clean-up Set (CE-07)
E-602 Panelboard Sched. - 1st Level Research Wing 10/11/96 Clean-up Set (CE-07)
E-603 Panelboard Sched. - 2nd Level Part A Research Wing 10/11/96 Clean-up Set (CE-07)
E-604 Panelboard Sched. - 2nd Level Part B Research Wing 10/11/96 Clean-up Set (CE-07)
E-605 Panelboard Sched. - 3rd Level Part A Research Wing 10/11/96 Clean-up Set (CE-07)
E-606 Panelboard Sched. - 3rd Level Part B Research Wing 10/11/96 Clean-up Set (CE-07)
E-607 Panel Schedule - 4th Lvl Part A & Inter. Elec.CI's 10/11/96 Clean-up Set (CE-07)
E-607.1 Panelboard Sched. - 4th Level Part B Research Wing 10/11/96 Clean-up Set (CE-07)
E-608 Panel Schedule - 1st & 2nd Lvl - Education 10/11/96 Clean-up Set (CE-07)
E-609 Panel Schedule - 3rd & 4th Lvl - Education 10/11/96 Clean-up Set (CE-07)
E-610 Panel Schedule - Inter Elec. Closets & 5th - Educati 10/11/96 Clean-up Set (CE-07)
E-611 Distribution Panelboard Sched. - Type LDPN, LDPE 10/11/96 Clean-up Set (CE-07)
E-612 Distribution Panelboard Sched. - Type RDPN 10/11/96 Clean-up Set (CE-07)
E-613 Distribution & Power Panelboard Schedule 10/11/96 Clean-up Set (CE-07)
E-614 Motor Control Center Schedules & Wiring Diagrams 10/11/96 Clean-up Set (CE-07)
E-615 Unit Substation & Generator Switchboard Schedule 10/11/96 Clean-up Set (CE-07)
E-616 Unit Substation/Generator Switchboard Schedule 10/11/96 Clean-up Set (CE-07)
E-617 Panelboard Sched. - 5th Level BME 10/11/96 Clean-up Set (CE-07)
E-618 Panel Schedule - 3rd Lvl Inter.Elec Rooms - BME 10/11/96 Clean-up Set (CE-07)
E-701 Network Services LAN/PDS Systems/Equip - Educ. 10/11/96 Clean-up Set (CE-07)
E-810 Power One Line Diagram - 11.4KV Primary Service 10/11/96 Clean-up Set (CE-07)
E-820 Power One Line Diagram 480v Secondary Distribution 10/11/96 Clean-up Set (CE-07)
E-821 Power One Line Diagram - Bldg. Distribution Resear 10/11/96 Clean-up Set (CE-07)
E-822 Power One Line Diagram - Bldg. Distribution - Educ. 10/11/96 Clean-up Set (CE-07)
E-823 Power One Line Diagram - Bldg. Distribution - Educ. 10/11/96 Clean-up Set (CE-07)
E-830 Power One Line Diagram - Primary Dist. - BME 10/11/96 Clean-up Set (CE-07)
E-831 Power One Line Diagram - BME/Biostat Wing - North 10/11/96 Clean-up Set (CE-07)
E-832 Power One Line Diagram - BME/Biostat Wing - South 10/11/96 Clean-up Set (CE-07)
E-910 Fire Alarm System Riser and Wiring Diagram 10/11/96 Clean-up Set (CE-07)
E-920 Risers - Network Services/Structured Cabling 10/11/96 Clean-up Set (CE-07)
E-930 Riser Diagram - Broadband LAN Cabling System 10/11/96 Clean-up Set (CE-07)
Food Service
FS1.01 Food Service Equip - Plan & Schedule 6/17/96 GMP Bid Set
FS1.02 Food Service Equipment - Electrical Spot Connection 6/17/96 GMP Bid Set
FS1.03 Food Service Equipment - Mech Spot Connection Plan 6/17/96 GMP Bid Set
FS1.04 Food Service Equip - Special Conditions Plan 6/17/96 GMP Bid Set
FS1.05 Food Service Equip - Elevations & Sections 6/17/96 GMP Bid Set
FS1.06 Food Service Equip - Elevations & Sections 6/17/96 GMP Bid Set
FS1.07 Food Service Equip - Utility Load Schedule 6/17/96 GMP Bid Set
FS1.08 Food Service Equip - Utility Load Schedule 6/17/96 GMP Bid Set
FS1.09 Food Service Equip - Utility Load Schedule 6/17/96 GMP Bid Set
FS1.10 Food Service Equip - Utility Load Schedule 6/17/96 GMP Bid Set
Laboratory
K-021 Abbrev., Symbols, Schedules & General Notes 10/11/96 Clean-up Set (CE-07)
K-022 Door Schedule 10/11/96 Clean-up Set (CE-07)
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</TABLE>
<PAGE> 19
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
Number Title Revised Date Noted
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
K-120 Basement Level Plan 10/11/96 Clean-up Set (CE-07)
K-121 First Level Plan 10/11/96 Clean-up Set (CE-07)
K-122 Second Level Plan 10/11/96 Clean-up Set (CE-07)
K-123 Third Level Plan 10/11/96 Clean-up Set (CE-07)
K-123l Third Level Interstitial Plan 10/11/96 Clean-up Set (CE-07)
K-124 Fourth Level Plan 10/11/96 Clean-up Set (CE-07)
K-124l Fourth Level Interstitial Plan 10/11/96 Clean-up Set (CE-07)
K-220a Basement Level Floor Plan - West 10/11/96 Clean-up Set (CE-07)
K-220b Basement Level Floor Plan - East 10/11/96 Clean-up Set (CE-07)
K-221b First Level Floor Plan - East 10/11/96 Clean-up Set (CE-07)
K-222a Second Level Floor Plan - West 10/11/96 Clean-up Set (CE-07)
K-222b Second Level Floor Plan - East 10/11/96 Clean-up Set (CE-07)
K-223a Third Level Floor Plan - West 10/11/96 Clean-up Set (CE-07)
K-223b Third Level Floor Plan - East 10/11/96 Clean-up Set (CE-07)
K-224a Fourth Level Floor Plan - West 10/11/96 Clean-up Set (CE-07)
K-224b Fourth Level Floor Plan - East 10/11/96 Clean-up Set (CE-07)
K-320a Basement - West - Cabinet & Equipment Plan 10/11/96 Clean-up Set (CE-07)
K-320b Basement - East - Cabinet & Equipment Plan 10/11/96 Clean-up Set (CE-07)
K-321b First Floor - East - Cabinet & Equipment Plan 10/11/96 Clean-up Set (CE-07)
K-322a Second Floor - West - Cabinet & Equipment Plan 10/11/96 Clean-up Set (CE-07)
K-322b Second Floor - East - Cabinet & Equipment Plan 10/11/96 Clean-up Set (CE-07)
K-323a Third Floor - West - Cabinet & Equipment Plan 10/11/96 Clean-up Set (CE-07)
K-323b Third Floor - East - Cabinet & Equipment Plan 10/11/96 Clean-up Set (CE-07)
K-324a Fourth Floor - West - Cabinet & Equipment Plan 10/11/96 Clean-up Set (CE-07)
K-324b Fourth Floor - East - Cabinet & Equipment Plan 10/11/96 Clean-up Set (CE-07)
K-420a Basement - West - Reflected Ceiling Plan 10/11/96 Clean-up Set (CE-07)
K-420b Basement - East - Reflected Ceiling Plan 10/11/96 Clean-up Set (CE-07)
K-421b First Floor - East - Reflected Ceiling Plan 10/11/96 Clean-up Set (CE-07)
K-422a Second Floor - West - Reflected Ceiling Plan 10/11/96 Clean-up Set (CE-07)
K-422b Second Floor - East - Reflected Ceiling Plan 10/11/96 Clean-up Set (CE-07)
K-423a Third Floor - West - Reflected Ceiling Plan 10/11/96 Clean-up Set (CE-07)
K-423b Third Floor - East - Reflected Ceiling Plan 10/11/96 Clean-up Set (CE-07)
K-424a Fourth Floor - West - Reflected Ceiling Plan 10/11/96 Clean-up Set (CE-07)
K-424b Fourth Floor - East - Reflected Ceiling Plan 10/11/96 Clean-up Set (CE-07)
K-429 Enlarged Reflected Ceiling Plan 10/11/96 Clean-up Set (CE-07)
K-521 Building Laboratory Transverse Section A 10/11/96 Clean-up Set (CE-07)
K-522 Building Laboratory Transverse Section B 10/11/96 Clean-up Set (CE-07)
K-523 Building Laboratory Longitudinal Section C 10/11/96 Clean-up Set (CE-07)
K-524 Building Laboratory Longitudinal Section D 10/11/96 Clean-up Set (CE-07)
K-525 Partial Building Sections E & F 10/11/96 Clean-up Set (CE-07)
K-526 Partial Building Sections G & H 10/11/96 Clean-up Set (CE-07)
K-621a First Level Interior Elevations 10/11/96 Clean-up Set (CE-07)
K-621b First Level Interior Elevations 10/11/96 Clean-up Set (CE-07)
K-622a Second Level Laboratory Elevations 10/11/96 Clean-up Set (CE-07)
K-622b Second Level Corridor Elevations 10/11/96 Clean-up Set (CE-07)
K-622c Second Level Lab Entry Elevations 10/11/96 Clean-up Set (CE-07)
K-623a Third & Fourth Level Laboratory Elevations 10/11/96 Clean-up Set (CE-07)
K-623b Third Level Corridor Elevations 10/11/96 Clean-up Set (CE-07)
K-623c Third Level Lab Entry Elevations 10/11/96 Clean-up Set (CE-07)
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 20
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Number Title Revised Date Noted
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
K-629a Tissue Culture & Misc. Specialty Rooms 10/11/96 Clean-up Set(CE-07)
K-629b Meeting Room Detail Plans & Elevations 10/11/96 Clean-up Set(CE-07)
K-721 Typical Lab Bench Elevations 10/11/96 Clean-up Set(CE-07)
K-722 Typical Lab Bench Sections 10/11/96 Clean-up Set(CE-07)
K-723 Cabinet Types 10/11/96 Clean-up Set(CE-07)
K-724 Cabinet Types & Details 10/11/96 Clean-up Set(CE-07)
K-725 Cabinet Details 10/11/96 Clean-up Set(CE-07)
K-820 Basement Floor Finish Plan 10/11/96 Clean-up Set(CE-07)
K-821 First Floor Finish Plan 10/11/96 Clean-up Set(CE-07)
K-822 Second Floor Finish Plan 10/11/96 Clean-up Set(CE-07)
K-823 Third Floor Finish Plan 10/11/96 Clean-up Set(CE-07)
K-824 Fourth Floor Finish Plan 10/11/96 Clean-up Set(CE-07)
K-921 Standard Partitions and Framing 10/11/96 Clean-up Set(CE-07)
K-922 Door & Window Details 10/11/96 Clean-up Set(CE-07)
K-923 Automatic Door & Misc. Details 10/11/96 Clean-up Set(CE-07)
K-924 Interior Finish & Misc. Details 10/11/96 Clean-up Set(CE-07)
K-925 Interior Finish Details 10/11/96 Clean-up Set(CE-07)
K-926 Ceiling Details 10/11/96 Clean-up Set(CE-07)
Landscape
CDL-100 Key Plan 6/17/96 GMP Bid Set
CDL-110 Landscape Plan 6/17/96 GMP Bid Set
CDL-115 Alternate Landscape Layout Plan 6/17/96 GMP Bid Set
CDL-120 Grading and Drainage Plan 6/17/96 GMP Bid Set
CDL-130 Paving Plan 6/17/96 GMP Bid Set
CDL-140 Tree Planting Plan 6/17/96 GMP Bid Set
CDL-141 Planting Plan (East of Col. Line R7) 6/17/96 GMP Bid Set
CDL-142 Planting Plan (West of Col. Line R8) 6/17/96 GMP Bid Set
CDL-143 Storer Garden 6/17/96 GMP Bid Set
CDL-144 Plant Schedule and Planting Details 6/17/96 GMP Bid Set
DDL-150 Site Details 6/17/96 GMP Bid Set
DDL-160 Irrigation Plan 7/24/96 Addendum No. 1
DDL-165 Irrigation Details 7/24/96 Addendum No. 1
Mechanical
H-210 Education Basement Plan Duct Work 10/11/96 Clean-up Set(CE-07)
H-211 Education First Floor Duct Work 10/11/96 Clean-up Set(CE-07)
H-212 Education Second Floor Duct Work 10/11/96 Clean-up Set(CE-07)
H-213 Education Third Floor Duct Work 10/11/96 Clean-up Set(CE-07)
H-2131 Education Level Three/Four Interstitial
Duct Work 10/11/96 Clean-up Set(CE-07)
H-214 Education Fourth Floor Duct Work 10/11/96 Clean-up Set(CE-07)
H-215 Education Fifth Floor Duct Work 10/11/96 Clean-up Set(CE-07)
H-220 Research Basement Plan 10/11/96 Clean-up Set(CE-07)
H-225 Research Fifth Floor Duct Work 10/11/96 Clean-up Set(CE-07)
H-226 Mechanical Equipment Floor Plan 10/11/96 Clean-up Set(CE-07)
H-231 BME Building Level One 10/11/96 Clean-up Set(CE-07)
H-232 BME Building Second Floor 10/11/96 Clean-up Set(CE-07)
H-233 BME Building Third Floor 10/11/96 Clean-up Set(CE-07)
H-234 BME Building Fourth Floor 10/11/96 Clean-up Set(CE-07)
H-235 BME Building Fifth Floor 10/11/96 Clean-up Set(CE-07)
- --------------------------------------------------------------------------------
</TABLE>
<PAGE> 21
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
Number Title Revised Date Noted
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
H-236 BME Building Roof Level 10/11/96 Clean-up Set (CE-07)
H-421a Research First Floor Duct Work 10/11/96 Clean-up Set (CE-07)
H-421b Research First Floor Duct Work 10/11/96 Clean-up Set (CE-07)
H-422a Research Second Floor Duct Work 10/11/96 Clean-up Set (CE-07)
H-422b Research Second Floor Duct Work 10/11/96 Clean-up Set (CE-07)
H-423a Research Third Floor Duct Work 10/11/96 Clean-up Set (CE-07)
H-423b Research Third Floor Duct Work 10/11/96 Clean-up Set (CE-07)
H-424a Research Fourth Floor Duct Work 10/11/96 Clean-up Set (CE-07)
H-424b Research Fourth Floor Duct Work 10/11/96 Clean-up Set (CE-07)
HP-001 Symbol Legend 10/11/96 Clean-up Set (CE-07)
HP-100 Site Plan 10/11/96 Clean-up Set (CE-07)
HP-101 Underground Piping Profiles 10/11/96 Clean-up Set (CE-07)
HP-108 Roof Plan 10/11/96 Clean-up Set (CE-07)
HP-240 Basement - NC Building 10/11/96 Clean-up Set (CE-07)
HP-241 First Floor - NC Building 10/11/96 Clean-up Set (CE-07)
HP-430 NC-NB Tunnel Revisions 10/11/96 Clean-up Set (CE-07)
HP-440 Research Main Mechanical Shaft 10/11/96 Clean-up Set (CE-07)
HP-441 Education Wing shaft Sections - South 10/11/96 Clean-up Set (CE-07)
HP-442 Education Wing Shaft Sections - North 10/11/96 Clean-up Set (CE-07)
HP-443 BME Main Mechanical Shaft 10/11/96 Clean-up Set (CE-07)
HP-444 BME Main Mechanical Shaft 10/11/96 Clean-up Set (CE-07)
HP-460 Bridge Plans and Sections 10/11/96 Clean-up Set (CE-07)
HP-500 Details 10/11/96 Clean-up Set (CE-07)
HP-501 Details 10/11/96 Clean-up Set (CE-07)
HP-502 Details 10/11/96 Clean-up Set (CE-07)
HP-504 Research Sections 10/11/96 Clean-up Set (CE-07)
HP-506 Mechanical Room Sections 10/11/96 Clean-up Set (CE-07)
HP-507 Sections and Diagrams 10/11/96 Clean-up Set (CE-07)
HP-508 Sections 10/11/96 Clean-up Set (CE-07)
HP-600 Equipment Schedules 10/11/96 Clean-up Set (CE-07)
HP-601 Equipment Schedules 10/11/96 Clean-up Set (CE-07)
HP-602 Equipment Schedules 10/11/96 Clean-up Set (CE-07)
HP-603 Equipment Schedules Lab Air Valves 10/11/96 Clean-up Set (CE-07)
HP-604 Equipment Schedules Lab Air Valves 10/11/96 Clean-up Set (CE-07)
HP-700 Control Diagrams 10/11/96 Clean-up Set (CE-07)
HP-701 Control Diagrams 10/11/96 Clean-up Set (CE-07)
HP-702 Control Diagrams 10/11/96 Clean-up Set (CE-07)
HP-703 Control Diagrams 10/11/96 Clean-up Set (CE-07)
HP-704 Control Diagrams 10/11/96 Clean-up Set (CE-07)
HP-705 Control Diagrams 10/11/96 Clean-up Set (CE-07)
HP-706 Control Diagrams 10/11/96 Clean-up Set (CE-07)
HP-707 Control Diagrams 10/11/96 Clean-up Set (CE-07)
HP-708 Temperature Control 10/11/96 Clean-up Set (CE-07)
HP-708A Chiller Plant Manager 10/11/96 Clean-up Set (CE-07)
P-210 Education Basement Plan Piping 10/11/96 Clean-up Set (CE-07)
P-211 Education First Floor Piping 10/11/96 Clean-up Set (CE-07)
P-212 Education Second Floor Piping 10/11/96 Clean-up Set (CE-07)
P-213 Education Third Floor Piping 10/11/96 Clean-up Set (CE-07)
P-214 Education Fourth Floor Piping 10/11/96 Clean-up Set (CE-07)
- -------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 22
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
Number Title Revised Date Noted
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
P-215 Education Fifth Floor Piping 10/11/96 Clean-up Set (CE-07)
P-220 Research Basement Piping 10/11/96 Clean-up Set (CE-07)
P-221 Research First Floor-Heating Piping 10/11/96 Clean-up Set (CE-07)
P-222 Research Second Floor-Heating Piping 10/11/96 Clean-up Set (CE-07)
P-223 Research Third Floor-Heating Piping 10/11/96 Clean-up Set (CE-07)
P-224 Research Fourth Floor-Heating Piping 10/11/96 Clean-up Set (CE-07)
P-225 Research Fifth Floor-Plumbing & HVAC Piping 10/11/96 Clean-up Set (CE-07)
P-226 Research/Education Interstitial Mech Equip Plan 10/11/96 Clean-up Set (CE-07)
P-230 BME Basement 10/11/96 Clean-up Set (CE-07)
P-231 BME First Floor 10/11/96 Clean-up Set (CE-07)
P-232 BME Second Floor 10/11/96 Clean-up Set (CE-07)
P-233 BME Third Floor 10/11/96 Clean-up Set (CE-07)
P-234 BME Fourth Floor 10/11/96 Clean-up Set (CE-07)
P-235 BME Fifth Floor 10/11/96 Clean-up Set (CE-07)
P-236 BME Roof 10/11/96 Clean-up Set (CE-07)
P-420 Research Basement Equipment Room 10/11/96 Clean-up Set (CE-07)
P-420a Research Basement Equipment Room 10/11/96 Clean-up Set (CE-07)
P-421a Research First Floor Piping 10/11/96 Clean-up Set (CE-07)
P-421b Research First Floor Piping 10/11/96 Clean-up Set (CE-07)
P-422a Research Second Floor Piping 10/11/96 Clean-up Set (CE-07)
P-422b Research Second Floor Piping 10/11/96 Clean-up Set (CE-07)
P-423a Research Third Floor Piping 10/11/96 Clean-up Set (CE-07)
P-423b Research Third Floor Piping 10/11/96 Clean-up Set (CE-07)
P-424a Research Fourth Floor Piping 10/11/96 Clean-up Set (CE-07)
P-424b Research Fourth Floor Piping 10/11/96 Clean-up Set (CE-07)
P-500 Plumbing Stacks 10/11/96 Clean-up Set (CE-07)
P-501 Plumbing Stacks 10/11/96 Clean-up Set (CE-07)
P-502 Plumbing Stacks 10/11/96 Clean-up Set (CE-07)
P-503 Plumbing Stacks 10/11/96 Clean-up Set (CE-07)
P-504 High Purity Water System Diagram 10/11/96 Clean-up Set (CE-07)
P-505 Gas Service System Diagram 10/11/96 Clean-up Set (CE-07)
P-506 Carbon Dioxide LN2 Piping Diagrams 10/11/96 Clean-up Set (CE-07)
P-507 Fire Protection Riser Diagram 10/11/96 Clean-up Set (CE-07)
P-508 Non-Potable Water System 10/11/96 Clean-up Set (CE-07)
P-509 Lab Air & Vacuum System Diagrams 10/11/96 Clean-up Set (CE-07)
P-510 Plumbing Stacks 10/11/96 Clean-up Set (CE-07)
Structural
S-210 Education Wing Foundation Plan 10/2/96 Clean-up Set (CE-07)
S-210C Education Wing Caisson Plan 10/2/96 Clean-up Set (CE-07)
S-211 Education Wing First Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-212 Education Wing Second Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-213 Education Wing Third Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-213 Education Wing Interstitial Plans and Details 10/9/96 Clean-up Set (CE-07)
S-214 Education Wing Fourth Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-215 Education Wing Fifth Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-216 Education Wing Main Roof and P.H. Framing Plan 10/9/96 Clean-up Set (CE-07)
S-217 Education Wing Penthouse Roof Framing Plan 10/9/96 Clean-up Set (CE-07)
S-220 Research Wing Foundation Plan 10/2/96 Clean-up Set (CE-07)
- -----------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 23
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------
Number Title Revised Date Noted
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
S-220C Research Wing Caisson Plan 10/2/96 Clean-up Set (CE-07)
S-221 Research Wing First Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-222 Research Wing Second Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-223 Research Wing Third Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-223i Research Wing Third Floor Interstitial Plan 10/9/96 Clean-up Set (CE-07)
S-224 Research Wing Fourth Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-224i Research Wing Fourth Floor Interstitial Plan 10/9/96 Clean-up Set (CE-07)
S-225 Research Wing Fifth Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-225i Research Wing Fifth Floor Interstitial Plan 10/9/96 Clean-up Set (CE-07)
S-226 Research Wing Main Roof and P.H. Framing Plan 10/9/96 Clean-up Set (CE-07)
S-227 Research Wing Penthouse Roof Framing Plan 10/9/96 Clean-up Set (CE-07)
S-240 Pedestrian Bridge Plans & Details 10/9/96 Clean-up Set (CE-07)
S-310 Education Wing Sections and Details 10/9/96 Clean-up Set (CE-07)
S-311 Education Wing Curtain Wall Framing 10/9/96 Clean-up Set (CE-07)
S-320 Research Wing Sections and Details 10/9/96 Clean-up Set (CE-07)
S-321 Research Wing Sections and Details 10/9/96 Clean-up Set (CE-07)
S-322 Research Wing Interstitial Sections and Details 10/9/96 Clean-up Set (CE-07)
S-323 Research Wing Sections and Details 10/9/96 Clean-up Set (CE-07)
S-340 Pedestrian Bridge Sections & Details 10/9/96 Clean-up Set (CE-07)
S-400 Research & Education Wings 10/9/96 Clean-up Set (CE-07)
S-401 Research & Education Wings 10/9/96 Clean-up Set (CE-07)
S-402 Research & Education Wings 10/9/96 Clean-up Set (CE-07)
S-403 Research & Education Wings 10/9/96 Clean-up Set (CE-07)
S-404 North Elevation - Existing NC Building 10/9/96 Clean-up Set (CE-07)
S-410 Education Wing Column Schedule 10/9/96 Clean-up Set (CE-07)
S-411 Education Wing Beam & Slab Schedules 10/9/96 Clean-up Set (CE-07)
S-412 Education Wing Post-Tensioned Beam Profiles 10/9/96 Clean-up Set (CE-07)
S-413 Education Wing Post-Tensioned Beam Profiles 10/9/96 Clean-up Set (CE-07)
S-414 Education Wing Post-Tensioned Beam Profiles 10/9/96 Clean-up Set (CE-07)
S-415 Education Wing Post-Tensioned Beam Profiles 10/9/96 Clean-up Set (CE-07)
S-415a Education Wing Post-Tensioned Beam Profiles 10/9/96 Clean-up Set (CE-07)
S-416 Education Wing Post-Tensioned Beam Profiles 10/9/96 Clean-up Set (CE-07)
S-420 Research Wing Column Schedule 10/9/96 Clean-up Set (CE-07)
S-421 Research Wing Beam & Slab Schedules 10/9/96 Clean-up Set (CE-07)
S-B230 BME/Basement Floor Plan 10/9/96 Clean-up Set (CE-07)
S-B230C BME/Caisson Plan 10/9/96 Clean-up Set (CE-07)
S-B231 BME/First Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-B232 BME/Second Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-B233 BME/Third Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-B233i BME Interstitial Third Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-B234 BME/Fourth Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-B234i BME Interstitial Fourth Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-B235 BME/Fifth Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-B235i BME Interstitial Fifth Floor Framing Plan 10/9/96 Clean-up Set (CE-07)
S-B238 BME/Penthouse - Roof Framing Plan 10/9/96 Clean-up Set (CE-07)
S-B241 Bridge over E. 96th St. 10/9/96 Clean-up Set (CE-07)
S-B242 BME Bridge - BME/Education 10/9/96 Clean-up Set (CE-07)
S-B330 BME Foundation Sections 10/9/96 Clean-up Set (CE-07)
S-B331 BME Sections 10/9/96 Clean-up Set (CE-07)
- -----------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 24
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Number Title Revised Date Noted
- --------------------------------------------------------------------------------------------------------------
S-B332 BME Steel Sections 10/9/96 Clean-up Set (CE-07)
S-B333 BME Steel Sections 10/9/96 Clean-up Set (CE-07)
S-B400 BME/Typical Details 10/9/96 Clean-up Set (CE-07)
S-B401 BME/General Notes & Caisson Details 10/9/96 Clean-up Set (CE-07)
S-B405 BME/Granite Panel Wall System Sections & Details 10/9/96 Clean-up Set (CE-07)
S-B406 BME/Additional Typical Details 10/9/96 Clean-up Set (CE-07)
S-B430 BME/Col. Schedule and Piers 10/9/96 Clean-up Set (CE-07)
Specifications
Architectural
0000 Project Specifications 6/17/96 GMP Bid Set
0001 Addendum No. 1 Specifications 7/24/96 Addendum No. 1
0003 Addendum No. 2 Specifications 8/2/96 Addendum No. 2
0004 Clean-up Set (CE-07) Specifications 10/14/96 Clean-up Set (CE-07)
Turner Documents
T-001 Turner Special Conditions 7/23/96 Addendum No. 1
T-002 Anticipated Project Schedule 7/22/96 Addendum No. 1
T-003 Bid Clarification Letter No. 1 8/21/96 Bid Clarification Letters
T-004 Bid Clarification Letter No. 2 8/22/96 Bid Clarification Letters
T-005 Bid Clarification Letter No. 3 8/23/96 Bid Clarification Letters
T-006 Bid Clarification Letter No. 4 8/27/96 Bid Clarification Letters
T-007 Bid Clarification Letter No. 5 8/27/96 Bid Clarification Letters
T-008 Bid Clarification Letter No. 6 9/12/96 Bid Clarification Letters
End Of Report
- --------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 25
November 6, 1996-
To: All Health Sciences Center Contractors
Re: Cleveland Clinic Foundation
Health Sciences Center Project
Contract No. 6000H
Letter of Understanding/Project Mission Statement
Gentlemen:
This Letter of Understanding shall serve as your commitment to adhere to the
project management policies established by Turner Construction Company on the
Cleveland Clinic Foundations "Health Sciences Center" project.
1) As a subcontractor on this project, you fully understand the construction
schedule and phasing of the project as presented to you by Turner
Construction. All costs associated with adhering to this schedule and
phasing plans are incorporated into your contract sum.
2) During the course of the project, if any problem/conflict develops that may
affect the project schedule or cost, you shall alert Turner Construction
Company's Project Executive and Project Manager within forty-eight (48)
hours of it's identity.
3) This Contractor agrees to submit his quotations for proposed changes in the
work within ten (10) working days upon receipt of written documentation
describing the proposed change.
4) This Contractor agrees that his office and field staff shall take
directions from Turner Construction, not the Architect or any CCF
personnel, as it relates to the scope of work included in your contract
agreement with Turner on this project Turner Construction will coordinate
all communications with The Cleveland Clinic's, Consultant/Owners
Representative - Mr. Dick Mitchell.
5) This Contractor will advise Turner of any and all constructability issues
immediately upon discovery and assist an expeditious resolution.
6) It is the Owner's desire to complete this project in advance of the
completion date indicated on the bid schedule dated 7/22/96. In an attempt
to satisfy the Owner's desires, Turner Construction will evaluate the
progress of the work, and if deemed feasible in terms of sequencing,
phasing, and manpower, will draft a revised schedule indicating an earlier
completion date.
This Contractor shall make every effort to schedule the receipt of his
material/equipment so as not to preclude the project from being completed
ahead of the current schedule. Turner will submit and review the revised
schedule draft with the Contractor for his input and concurrence prior to
committing to the Owner.
In addition, this Contractor shall continually review the project schedule
as the work progresses and identify early work concepts that will shorten
the overall project schedule. These work concepts shall be reviewed with
Turner in sufficient time to allow proper coordination with other trades
affected.
EXHIBIT 'C'
<PAGE> 26
CLEVELAND CLINIC FOUNDATION
HEALTH SCIENCES CENTER
CONTRACT NO. 6000
PURCHASE REQUISITION NO. 3A
GLAZED ALUMINUM CURTAIN WALL SYSTEM
I SCOPE OF WORK
1. Bidders are to submit a lump sum proposal which shall include all
material, all necessary labor forces, equipment, samples, design drawings,
shop drawings, engineering, fabrication, surveying, supplies, plant,
tools, scaffolding, transportation, cranes, rigging, hoisting,
supervision, temporary construction of every nature, contributions,
insurance, permits, and all other services, facilities, and other things
necessary for the full performance of the work, as shown, and/or implied
by the contract documents and clarified herein.
2. The bidder for this bid package shall include all work generally defined
by the drawings or as necessary to result in a complete functioning
system. The scope of work for this bid package is to include work as
detailed in the following specification sections. (Note: Some
specification sections may be divided between packages or may govern the
work of more than one package.)
Division 1 - All Sections
Limited to roof exhaust stacks for work
Section 05700 Ornamental Metal Work - of this package and trellis
Section 07210 Building Insulation (for work of this package)
Section 07410 Manufactured Wall Panels (for work of this package)
Section 07901 Joint Sealers (for work of this package)
Section 08800 Glass and Glazing (for work of this package)
Section 08900 Exterior Wall General (for work of this package)
Section 08920 Glazed Aluminum Curtain Wall
Section 10200 Louvers and Vents (Exterior Only) (for work of this package)
II. GENERAL ITEMS
1. The inter-relationship of all bid documents must be carefully examined by
the bidders for the correlation of architectural, structural, mechanical,
and electrical details. Absence of or inadequacy of detail in this regard
must be brought to Turner's attention in your proposal for resolution by
the Architect/Engineer.
2. Bidders are required to visit the site and familiarize themselves with the
existing site and actual field conditions, and advise Turner in your
proposal of any exceptions taken with existing conditions. Any
inconsistencies, omissions, out of tolerance dimensions relating to the
work of others that affect the scope of your work, must be identified and
submitted with your proposal.
3. Bidders are advised that specific scope items referenced in the documents
as related to tunnel relocation and site demolition have been previously
bid/awarded/performed by others. Copies of applicable scope documents
pertaining to same are available for review at Turner's on site field
office.
1
EXHIBIT "D" (7 PAGES TOTAL)
<PAGE> 27
II. GENERAL ITEMS (Continued...)
4. Turner Construction Company will secure the general building permit for the
project. Trade Contractors are responsible to secure the required permits
for their trade, including any necessary street opening and/or obstruction
permits.
5. Contractors are responsible to implement their work and maintain progress
in conformance with Turner's job progress schedule. Contractors are
responsible for all overtime, shift differential, and/or manpower necessary
to maintain your portion of the job progress schedule. Should
overtime/shift work be required because of contractors negligence and/or
inability to maintain the pace of the project, this contractor will be
charged for the added cost to provide temporary light, temporary power and
temporary heat, if required.
6. Include comeback and out of sequence work which may be required due to
temporary facilities, access for long lead mechanical/electrical items,
and/or scheduling constraints.
7. Contractor shall furnish, install, and conduct his work as required to
effect compliance with all existing codes, laws and ordinances, City,
State, and Federal regulations, including OSHA and EPA requirements.
8. Turner Construction reserves the right to reject any employee on this
project who does not conduct himself in a safe manner, or does not work in
a manner which benefits the project as a whole. Rejected employees shall be
removed from the job site at once without appeal.
9. Any shutdowns of existing lines or services to the hospital required for
joining new work to old work must be done at the sole convenience of the
hospital. This includes overtime work and/or temporary facilities as
required. All such work is to be carefully and completely coordinated with
Turner and the hospital.
10. Contractors are responsible to perform their own layout of work installed
under their bid package. Basic site horizontal and vertical control will be
provided by others to early phase contractors.
11. Bidders are advised to review the Turner Special Conditions regarding site
access procedures, on site material storage, and project administration
procedures, as well as provisions for temporary facilities including
temporary light, temporary power, temporary heat, and temporary plumbing.
12. Contractors are responsible for their own continuous clean-up and final
cleaning of your work as directed by Turner's Project Superintendent and
outlined in the Turner Special Conditions.
13. Include in your proposal a $10,000 allowance to be used as directed by
Turner's Project Superintendent upon written authorization. Unused
allowance dollar at project completion will be reconciled via deduct change
order.
14. In order to maintain project site communications, this Contractor shall
provide portable radios to operate on the Turner frequency. Radios are
available from Independence Communications for the purchase price of
$952.00, including all programming, charger, etc.
III. SPECIFIC CLARIFICATIONS
The work is the complete design, furnishing, and installation of the Glazed
Aluminum Curtain Wall System as specified in the Contract Documents and the
following clarifications:
2
<PAGE> 28
III. SPECIFIC CLARIFICATIONS (Continued...)
1. The selection of the Glazed Aluminum Curtain Wall System Trade Contractor
is on the basis of Contractor's proven ability to DESIGN and CONSTRUCT an
acceptable system consistent with the intent of the Contract Documents.
2. The work includes all necessary labor, material, scaffolding, equipment,
tools, hoisting, rigging, transportation, storage, and any other item or
facility required or reasonably inferred to provide a complete glazed
aluminum curtain wall system.
3. The work consists of, but is not limited to:
A. Glass and Glazing, Windows
B. Aluminum Framing, gaskets, seals, etc.
(*)C. Storefront and entrances - HARDWARE PER HARDWARE SCHEDULE BY OTHERS
D. Flashing (ANY PLACE ATTACHED TO CURTAINWALL SYSTEM COMPONENTS)
E. Parapets including all copings (COPING AT CURTAINWALL AREAS ONLY.
PARAPET BACK PANEL BY OTHERS)
F. Waterproofing of system as necessary
G. Structural anchors
H. Anchorage for glazed aluminum curtain wall systems
I. Onsite QA/QC Mock-up (AS A PART OF PERMANENT INSTALLATION ONLY)
J. Laboratory mock-up including fees of testing laboratory and travel
expenses of Owner, Architect, and Construction Manager (PER BID
CLARIFICATION LETTER #3 DATED 8/23/96)
K. Insulation
L. Firesafing
M. Caulking (EVERY PLACE WHERE IT TOUCHES CURTAINWALL SYSTEM
COMPONENTS)
N. Clean-up
O. Louvers and vents occurring in exterior wall (at all areas)
P. Roofing interface
Q. Trellis
R. Roof exhaust stacks (ref. drawing A-1193)
S. Include curtainwall for pedestrian bridge, including belly pans and
interior metal wall panels (standing seam roof is by others)
T. RIDER "A" AS MODIFIED DATED 10/9/96
4. The Glazed Aluminum Curtain Wall System Trade Contractor shall provide all
structural components required for the support and installation of the
glazed aluminum curtain wall. The Glazed Aluminum Curtain Wall System
Trade Contractor shall design any additional slab reinforcement for
anchors and coordinate design information so that this work is coordinated
with the structural frame packages. The Glazed Aluminum Curtain Wall
System Trade Contractor will furnish and install all structural steel
framing required for the glazed aluminum curtain wall system, such as
kickers.
5. All embed plate anchors or angles shall be sized to accommodate an
Installation tolerance of plus or minus three inches in any direction.
(CLARIFIED AS PLACEMENT TOLERANCE OF 1-1/2" IN ANY DIRECTION.)
6. The Glazed Aluminum Curtain Wall System Trade Contractor is responsible
for all testing as described within the specifications, AS CLARIFIED
HEREIN.
(*) 3.C ABOVE IS FURTHER CLARIFIED THAT HARDWARE AND/OR HARDWARE TEMPLATES TO
BE FURNISHED TO SUBCONTRACTOR PRIOR TO DOOR MANUFACTURING. SUBCONTRACTOR
TO ADVISE AS TO REQUIRED TIME FRAME.
3
<PAGE> 29
III. Specific Clarifications (Continued...)
7. The Glazed Aluminum Curtain Wall System Trade Contractor is to include all
costs for the laboratory mock-up. This covers labor and materials to erect
the Glazed Aluminum Curtain Wall System portion of the mock-up at either of
the testing laboratories referenced in the specifications, as well as all
laboratory fees for the mock-up in its entirety, i.e. including stone truss
and/or precast components which will be delivered/installed by others. The
Glazed Aluminum Curtain Wall System Trade Contractor will be the primary
coordinator for the mock-up testing. Also, include an allowance of $25,000
to cover traveling expenses for the Architects, Owner, and Construction
Manager. (Note: This is in addition to the onsite mock-up included under
section 08920, item 1.2.H.)
8. The Glazed Aluminum Curtain Wall System Trade Contractor will coordinate the
design, mock-up, fabrication, and installation of the glazed aluminum
curtain wall with the other prime contractors and will sequence his work
accordingly.
9. Site Conditions:
A. A dual cage, 5,000 pound capacity, personnel and material hoist, to be
located along the south side of the building, will be available on an as
scheduled basis in accordance with Turner's Special Conditions.
B. The Glazed Aluminum Curtain Wall Trade Contractor shall provide his own
means of rigging and hoisting such as a mobile tower crane or similar
crane.
C. Cleaning up of all debris, such as crating materials, rubble, scrap
aluminum, is the responsibility of the Glazed Aluminum Curtain Wall
Trade Contractor. The Glazed Aluminum Curtain Wall Trade Contractor
shall remove debris from each floor and dispose of in accordance with
Turner's Special Conditions.
D. The structural steel and concrete frame Contractors will provide the
perimeter safety cable/barricade system and will maintain the same until
the start of the Glazed Aluminum Curtain Wall System. At that time, the
Glazed Aluminum Curtain Wall System Trade Contractor will remove that
portion of the perimeter safety cable/barricade system needed to install
the Curtain Wall System. The Curtain Wall System Trade Contractor will
reinstall that portion of the removed safety cable/barricade system as
necessary and place any unnecessary safety cable in one area of the
floor for removal and disposition by others.
E. On site storing of Glazed Aluminum Curtain Wall System materials is
limited. Storing/stocking of materials to be coordinated with the
Project Superintendent.
F. All deliveries must be coordinated with Construction Manager.
G. Major deliveries to the site can only occur during the weekday non-rush
hours which are from 9:00 a.m. to 4:00 p.m. and from 7:00 p.m. to 6:00
a.m. During rush hours, 6:00 a.m. to 9:00 a.m. and 4:00 p.m. to 7:00
p.m., Contractors can not make deliveries to the site. Weekend
deliveries are allowed, however, all premium costs for guards, traffic
control, electric, electricians, hoists and operators, etc., shall be at
the Glazed Aluminum Curtain Wall System Trade Contractor's expense.
H. Glazed Aluminum Curtain Wall System Trade Contractor shall provide his
own line and grade controls based on control lines and bench marks
provided by others in accordance with Turner's Special Conditions.
<PAGE> 30
** Confidential treatment requested pursuant to Rule 406
III. Specific Clarifications (Continued...)
1. Temporary power will be provided by the Electrical Trade Contractor
in accordance with Turner's Special Conditions. Any additional power
requirements or the cost to hook up special equipment, such as
welders, will be by the Glazed Aluminum Curtain Wall System Trade
Contractor.
10. Glazed Aluminum Curtain Wall System Trade Contractor shall wipe clean the
components of the system during installation and shall include a final
cleaning of the exterior side upon completion of the system.
11. (DELETED)
12. Contractors must submit with their proposal a set of drawings as per
section 08900. The contractor must also submit a list of deviations from
the base design including any vendor or fabricator substitutions.
13. Base Bid is to include a ** warranty. This includes all components,
including sealants. Warranty to run directly to the Owner.
14. Contractor is to include in his proposal a detail schedule for the mockup,
engineering, fabrication, erection, etc. that is consistent with the
project schedule. (See Exhibit "A" attached hereto.)
15. Basis of proposal is to allow for an edge of slab tolerance that may vary
plus or minus 1.5 inches in any direction, an overall adjustment of three
inches up or down or in and out.
16. Contractor to provide layout drawings for embedded anchors, plates, etc. so
as to maintain project schedule for concrete, structural steel, pt
concrete, etc. Embeds are to be furnished by Glazed Aluminum Curtain Wall
System Contractor and installed by Concrete Contractor, Bid Package #4.
17. Work does not include interior glass and glazing.
---
18. Design of expansion joints which attaches to the Work of this Trade
Contractor (*)
19. Contractor may propose voluntary design alternates for consideration and
review.
20. Contractor must submit a site staging plan with his proposal showing
proposed stocking areas, crane locations and movements, and means of
relocating crane around the site.
21. (Per item 9, Additional Provisions, page 3B)
22. Include one onsite test for air and water infiltration using a job built
test chamber, to be performed at direction of Turner's Project
Superintendent.
23. Include all required winter weather protection necessary to complete this
scope of work in accordance with Turner's Project Schedule.
24. This Contractor shall identify all subcontractors and the scope of work
each will provide as part of his bid.
(*) and includes furnishing and installing complete unit vertically and
horizontally as may be required.
5
<PAGE> 31
** Confidential treatment requested pursuant to Rule 406
III. Specific Clarifications (Continued...)
25. The Glazed Aluminum Curtain Wall System Trade Contractor shall include
furnishing and installing all building insulation/firesafing occurring
integral with the glazed aluminum curtain wall system. (Building insulation
behind precast and stone truss will be by others.)
26. The Glazed Aluminum Curtain Wall System Trade Contractor shall include
furnishing and installing of joint sealants required for the installation
of work under this bid package only. (Caulking at precast and stone areas
is not work of this bid package.)
27. The Glazed Aluminum Curtain Wall System Trade Contractor shall include
furnishing and installing of all louvers and vents occurring in exterior
wall areas (whether in glazed curtain wall, stone, and/or precast areas.)
29. The Glazed Aluminum Curtain Wall System Trade Contractor shall include
furnishing and installing of architectural feature roof exhaust stacks
(ref. drawing A-1193).
30. The Glazed Aluminum Curtain Wall System Trade Contractor shall include
all work associated with the exterior Level 5 trellis systems at the
Education and BME buildings. Additionally, this work shall be priced as a
deduct alternate.
31. Standing seam roof panels occurring on the long pedestrian bridge are not
a part of this bid package.
IV. Comments Per Scope Review Meetings
1. Contractor has agreed to project engineering, mock-up, fabrication and
erection in accordance with the attached Exhibit "B" schedule. Schedule
performance is predicated on RFI, submittal and approval process parameters
as indicated on same.
2. Scope includes segmented glass and mullions with
curved tube at the BME and Education building (with the exception of
segmented elements at Education stair per accepted VE items noted below).
3. Scope includes segmented glass with curved tubes and panels at the
Research drum area.
4. Scope includes segmented glass and mullions with curved tubes at the
Education building library stair area.
5. Scope includes STC ratings for exterior wall (specification 08920) based on
the specified glass.
V. Accepted VE Items
The following value engineering items (not shown on the current documents) have
been incorporated into the base project award with the following values:
1. Utilize 3 coat in lieu of 4 coat exterior paint system **
2. Utilize polycron paint at interior **
3. Utilize aluminum in lieu of stainless steel doors **
V. Accepted VE Items (Continued...)
<PAGE> 32
** Confidential treatment requested pursuant to Rule 406
4. Eliminate molded corner at interior glazing gaskets ( ** )
5. Utilize segmented elements in lieu of curved at Education building
stair headpiece ( ** )
VI. Alternates - valid for 30 days beyond contract execution
--------------------------------------------------------
1. Add BME/Carnegie Bridge **
<PAGE> 33
Cleveland Clinic
Health Sciences Center
FCAM Quote # 9640
10/9/96
RIDER "A"
Our preceding outline and pricing is based on the following items:
EXCLUSIONS
- ----------
1. Protection of our materials during proper storage or during or after
installation.
2. Removal or replacement of aluminum, glass, or other materials broken or
damaged by others.
3. Rubbish removal from site. We will place our rubbish in provided dusters
located on the ground floor at reasonable intervals.
4. Subcontractor will be responsible for glass replacement labor & material
relating to 5 year warranty. After 5 year warranty is up, manufacturer
material warranty will be in effect. (See item 22 of this Rider for further
clarification)
5. Interior glass or aluminum work of any type.
6. Stone or stone support system.
7. Patching of fireproofing after attachment of curtainwall clips. Removal of
fireproofing will be held to a minimum. Unless removal of spray fireproofing
is excessive and uncontrolled.
8. Cost of furnishing bonds.
9. Layout, inspection and installation of embeds. Embeds and layout drawings
will be provided FOB jobsite for installation by the General Contractor or
his designated subcontractor, at no cost to FCAM.
10. Removal or disposal of OSHA cables from the floors or project site. This is
per item 9D of Purchase Requisition on page 4.
11. Providing, maintaining and removal of safety nets/overhead protection where
required. See item 10 above - also unless required for Subcontractor's work
and workforce.
<PAGE> 34
Cleveland Clinic
HCAM estimate #9640
10/9/96
Rider "A" continued...........
13. Expansion Joints at areas other than: Bridge." Per item 18, page 5 of
Purchase Requisition.
14. Liquidated damage assessments of any type.
15. Permits and fees. Building permit not Subcontractor's responsibility. Any
other specific permits required of Subcontractor to implement his work are
Subcontractor's responsibility.
16. Field measurements or examination of structure.
17. Out of sequence work other than hoist bay areas. Per item 9, page 3B of
Additional Provisions.
18. Work on overtime hours. Unless required due to Subcontractor's inability
to maintain agreed upon schedule.
20. Blankoffs for Louvers within our system.
21. We will make a concerted effort to meet the MBE/WBE targeted goals. This
issue has not been addressed at this time.
22. Glass warranty relates to - deterioration due to normal conditions of use,
incorrect installation, defective glass design, coating, etc. and as
further defined under "Definition" Article of Specification Section 08800
"Glazing".
<PAGE> 35
** Confidential treatment requested pursuant to Rule 406
Cleveland Clinic
Health Sciences Center
FCAM Quote #9640
10/9/96
ASSUMPTIONS AND CLARIFICATIONS
- ------------------------------
2. We require the use of sufficient perimeter floor space for the storage,
assembly, and installation of our materials.
3. Turner Construction is to provide adequate temporary 110 volt power,
toilets and water at reasonable locations at no cost to FCAM. This item per
Turner's Special Conditions.
4. Location for all cutouts for hose bibs, standpipes, fixtures, railings, etc.
shall be determined prior to fabrication of our work.
5. We require access to the perimeter of the building for
unloading/installation of fabricated materials.
TERMS
-----
1. Our price is predicated on net payment for dedicated materials (extrusions,
glass, etc.) and fabricated materials and engineering costs, upon
presentation of invoices and insurance certificates. This item only to
extent indicated in Turner's Special Conditions and does not relate to
Cuyahoga County only.
2. Our price is based on ** retention for the first ** of the value of the
work, and ** thereafter. Per Turner's Special Conditions.
We require that all mutually applicable information contained within this Rider
"A" be incorporated into the final agreement.
<PAGE> 36
Inspection and Defective Work
ARTICLE X. The Subcontractor shall at all times provide sufficient,
safe and proper facilities for the inspection of the Work by Turner, the
Architect and their authorized representatives in the field, at shops or at any
other place where materials or equipment for the Work are in the course of
preparation, manufacture, treatment or storage. The Subcontractor shall, within
twenty-four (24) hours after receiving written notice from Turner to that
effect, proceed to take down all portions of the Work and remove from the
premises any materials whether worked or unworked, which the Architect or Turner
shall condemn as unsound, defective or improper or as in any way failing to
conform to this Agreement or the Plans, Specifications or other Contract
Documents, and the Subcontractor, at its own cost and expense, shall replace the
same with proper and satisfactory work and materials and make good all work
damaged or destroyed by or as a result of such unsound, defective, improper or
nonconforming work or materials or by the taking down, removal or replacement
thereof.
Failure to Prosecute, etc.
ARTICLE XI. Should the Subcontractor at any time refuse or neglect to
supply a sufficiency of skilled workers or materials of the proper quality and
quantity, or fail in any respect to prosecute the Work with promptness and
diligence, or cause by any act of omission the stoppage, impede, obstruct,
hinder or delay of or interference with or damage to the work of Turner or of
any other contractors or subcontractors on the Project, or fail in the
performance of any of the terms and provisions of this Agreement or of the other
Contract Documents, or should the Architect determine that the Work or any
portion thereof is not being performed in accordance with the Contract
Documents, or should there be filed by or against the Subcontractor a petition
in bankruptcy or for an arrangement of reorganization, or should the
Subcontractor become insolvent or be adjudicated a bankrupt or go into
liquidation or dissolution, either voluntarily or involuntarily or under a court
order, or make a general assignment for the benefit of creditors, or otherwise
acknowledge insolvency, then in any of such events, each of which shall
constitute a default hereunder on the Subcontractor's part, Turner shall have
the right, in addition to any other rights and remedies provided by this
Agreement and the other Contract Documents or by law, after three (3) days
written notice to the Subcontractor mailed or delivered to the last known
address of the latter, (a) to perform and furnish through itself or through
others any such labor or materials for the Work and to deduct the cost thereof
from any monies due or to become due to the Subcontractor under this Agreement,
and/or (b) to terminate the employment of the Subcontractor for all or any
portion of the Work, enter upon the premises and take possession, for the
purpose of completing the Work, of all materials, equipment, scaffolds, tools,
appliances and other items thereon, all of which the Subcontractor hereby
transfers, assigns and sets over to Turner for such purpose, and to employ any
person or persons to complete the Work and provide all the labor, services,
materials, equipment, and other items required therefor. In case of such
termination of the employment of the Subcontractor, the Subcontractor shall not
be entitled to receive any further payment under this Agreement until the Work
shall be wholly completed to the satisfaction of Turner and the Architect and
shall have been accepted by them, at which time, if the unpaid balance of the
amount to be paid under this Agreement shall exceed the cost and expense
incurred by Turner in completing the Work, such excess shall be paid by Turner
to the Subcontractor, but if such cost and expense shall exceed such unpaid
balance, then the Subcontractor shall pay the difference to Turner. Such cost
and expense shall include, not only the cost of completing the Work to the
satisfaction of Turner and the Architect and of performing and furnishing all
labor, services, materials, equipment, and other items required therefor, but
also all losses, damages, costs and expenses, including legal fees and
disbursements sustained, incurred or suffered by reason of or resulting from the
Subcontractor's default.
Loss or Damage to Work
ARTICLE XII. Turner shall not be responsible for any loss or damage to
the Work to be performed and furnished under this Agreement, however caused,
until after final acceptance thereof by Turner and the Architect, nor shall
Turner be responsible for loss of or damage to materials, tools, equipment,
appliances or other personal property owned, rented or used by the Subcontractor
or anyone employed by it in the performance of the Work, however caused.
Fire Insurance
Turner or Owner shall effect and maintain fire insurance (with
extended coverage, if specified or otherwise required) upon all Work, materials
and equipment incorporated in the Project and all materials and equipment on or
about the Premises intended for permanent use or incorporation in the Project or
incident to the construction thereof, the capital value of which is included in
the cost of the Work, but not including any contractors' machinery, tools,
equipment, appliances or other personal property owned, rented or used by the
Subcontractor or anyone employed by it in the performance of the Work.
The total value of the property described above as insurable under
this Article and as shown on the approved monthly requisition provided for in
Article IV, plus the total value of similar property incorporated in the Project
or delivered on the Premises during the month but not included in said
requisition, as reported by the Subcontractor to Turner for insurance purposes
only, shall determine the total value of the Subcontractor's work, materials and
equipment to be insured under this Article.
The maximum liability to the Subcontractor under this insurance shall
be for not more than that proportion of any loss which the last reported value
of the insured property bore to the actual value of said property at the time of
such last report, and in no event for more than the actual loss.
In the event of a loss insured under this Article, the Subcontractor
shall be bound by any adjustment which shall be made between Turner or the Owner
and the insurance company or companies. Loss, if any, shall be made payable to
Turner and/or the Owner as their interests may appear, for the account of whom
it may concern.
Cleaning Up
ARTICLE XIII. The Subcontractor shall, at its own cost and expense,
(1) keep the Premises free at all times from all waste materials, packaging
materials and other rubbish accumulated in connection with the execution of its
Work by collecting and depositing said materials and rubbish in locations or
containers as designated by Turner from which it shall be removed by Turner from
the Premises without charge, (2) clean and remove from its Work and from all
contiguous work of others any soiling, staining, mortar, plaster, concrete or
dirt caused by the execution of its Work and make good all defects resulting
therefrom (3) at the completion of its Work in each area, perform such cleaning
as may be required to leave the area "broom clean", and (4) at the entire
completion of its Work remove all of its tools, equipment, scaffolds, shanties
and surplus materials. Should the Subcontractor fail to perform any of the
foregoing to Turner's satisfaction, Turner shall have the right to perform and
complete such work itself or through others and charge the cost thereof to the
Subcontractor.
Compliance with Law and Permits
ARTICLE XIV. The Subcontractor shall obtain and pay for all necessary
permits and licenses pertaining to the Work and shall comply with all Federal,
State, Municipal and local laws, ordinances, codes, rules, regulations,
standards, orders, notices and requirements, including but not limited to those
relating to safety, discrimination in employment, fair employment practices or
equal employment opportunity, and with the requirements of the American
Insurance Association, whether or not provided for by the Plans, Specifications,
General Conditions, or other Contract Documents, without additional charge or
expense to Turner, and shall also be responsible for and correct, at its own
cost and expense, any violations thereof resulting from or in connection with
the performance of its Work.
4
<PAGE> 37
The Subcontractor shall at any time upon demand furnish such proof as Turner may
require showing such compliance and the correction of such violations. The
Subcontractor agrees to save harmless and indemnify Turner from and against any
and all loss, injury, claims, actions, proceedings, liability, damages, fines,
penalties, costs and expenses, including legal fees and disbursements, caused or
occasioned directly or indirectly by the Subcontractor's failure to comply with
any of said laws, ordinances, rules, regulations, standards, orders, notices or
requirements or to correct such violations.
Labor to be Employed
ARTICLE XV. The Subcontractor shall not employ men, means, materials or
equipment which may cause strikes, work stoppages or any disturbances by workers
employed by the Subcontractor, Turner or other contractors or subcontractors on
or in connection with the Work or the Project or the location thereof. The
Subcontractor agrees that all disputes as to jurisdiction of trades shall be
adjusted in accordance with any plan for the settlement of jurisdictional
disputes which may be in effect either nationally or in the locality in which
the Work is being done and that it shall be bound and abide by all such
adjustments and settlements of jurisdictional disputes, provided that the
provisions of this Article shall not be in violation of or in conflict with any
provisions of law applicable to the settlement of such disputes. Should the
Subcontractor fail to carry out or comply with any of the foregoing provisions,
Turner shall have the right, in addition to any other rights and remedies
provided by this Agreement or the other Contract Document or by law, after three
(3) days written notice mailed or delivered to the last known address of the
Subcontractor, to terminate this Agrement or any part thereof or the employment
of the Subcontractor for all or any portion of the Work, and, for the purpose of
completing the Work, to enter upon the Premises and take possession, in the same
manner, to the same extent and upon the same terms and conditions as set forth
in Article XI of this Agreement.
Taxes and Contributions
ARTICLE XVI. The Subcontractor for the Price herein provided for, hereby
accepts and assumes exclusive liability for and shall indemnify, protect and
save harmless Turner and the Owner from and against the payment of:
1. All contributions, taxes or premiums (including interest, and penalties
thereon) which may be payable under the Unemployment Insurance Law of any
State, Federal Social Security Act, Federal, State, County and/or Municipal
Tax Withholding Laws, or any other law, measured upon the payroll of or
required to be withheld from employees, by whomsoever employed, engaged in
the Work to be performed and furnished under this Agreement.
2. All sales, use, personal property and other taxes (including interest and
penalties thereon) required by any Federal, State, County, Municipal or
other law to be paid or collected by the Subcontractor or any of its
subcontractors or vendors or any other person or persons acting for,
through or under it or any of them, by reason of the performance of the
Work or the acquisition, ownership, furnishing or use of any materials,
equipment, supplies, labor, services or other items for or in connection
with the Work.
3. All pension, welfare, vacation, annuity and other union benefit
contributions payable under or in connection with labor agreements with
respect to all persons, by whomsoever employed, engaged in the Work to be
performed and furnished under this Agreement.
Patents
ARTICLE XVII. The subcontractor hereby agrees to indemnify, protect and
save harmless Turner and the Owner from and against any and all liability, loss
or damage and to reimburse Turner and the Owner for any expenses, including
legal fees and disbursements, to which Turner and the Owner may be put because
of claims or litigation on account of infringement or alleged infringement of
any letters patent or patent rights by reason of the Work or materials,
equipment or other items used by the Subcontractor in its performance.
Mechanics' Liens or Claims
ARTICLE XVIII. The Subcontractor for its subcontractors, laborers and
materialmen and suppliers and all others directly or indirectly acting for,
through or under it or any of them covenants and agrees that no liens or
claims, whether a mechanics' lien or an affected account or otherwise, will be
filed or maintained against the Project or Premises or any part thereof or any
interests therein or any improvements thereon, or against any monies due or to
become due from the Owner to Turner or from Turner to the Subcontractor, for or
on account of any work, labor, services, materials, supplies, equipment, or
other items performed or furnished for or in connection with the Work, and the
Subcontractor for its Subcontractors, laborers, and materialmen and suppliers
and all others above mentioned does hereby expressly waive, release and
relinquish all rights to file or maintain such liens and claims and agrees
further that this waiver of the right to file or maintain such liens and claims
shall be an independent covenant and shall apply as well to work, labor and
services performed and materials, supplies, equipment and other items furnished
under any change order or supplemental agreement for extra or additional work
in connection with the Project as to the Original Work covered by this
Agreement.
If any subcontractor, laborer, materialman or supplier of the
Subcontractor or any other person directly or indirectly acting for, through or
under it or any of them files or maintains a lien or claim, whether a
mechanics' lien or an affected account or otherwise, a mechanic's lien or claim
against the Project or Premises or any part thereof or any interests therein or
any improvements thereon or against any monies due or to become due from the
Owner to Turner or from Turner to the Subcontractor, for or on account of any
work, labor, services, materials, supplies, equipment or other items performed
or furnished for or in connection with the Work or under any change order or
supplemental agreement for extra or additional work in connection with the
Project, the Subcontractor agrees to cause such liens and claims to be
satisfied, removed or discharged at its own expense by bond, payment or
otherwise within ten (10) days from the date of the filing thereof, and upon
its failure so to do Turner shall have the right, in addition to all other
rights and remedies provided under this Agreement and the other Contract
Documents or by law, to cause such liens or claims to be satisfied, removed or
discharged by whatever means Turner chooses, at the entire cost and expense of
the Subcontractor (such cost and expense to include legal fees and
disbursements). The Subcontractor agrees to indemnify, protect and save
harmless Turner and the Owner from and against any and all such liens and
claims and actions brought or judgments rendered thereon, and from and against
any and all loss, damages, liability, costs and expenses, including legal fees
and disbursements, which Turner and/or the Owner may sustain or incur in
connection therewith.
Assignment and Subletting
ARTICLE XIX. Neither this Agreement nor any monies due or to become due
hereunder shall be assignable without the prior written consent of Turner nor
shall the whole or any part of this Agreement be sublet without like prior
written consent. Any such assignment or subletting without such prior written
consent shall be void and of no effect and shall vent no right or right of
action in the assignee or subcontractor against Turner. Turner's consent to any
assignment or subletting shall not relieve the Subcontractor
5
<PAGE> 38
** Confidential treatment requested pursuant to Rule 406
of any of its agreements, duties, responsibilities or obligations
under this Agreement and the other Contract Documents, and the
Subcontractor shall be and remain as fully responsible and liable
for the defaults, neglects, acts and omissions of its assignees
and subcontractors and all persons directly or indirectly
employed by them as it is for its own defaults, neglects, acts
and omissions and those of its own officers, agents, servants and
employees. The Subcontractor shall bind each of its
subcontractors to all of the terms, provisions and covenants of
this Agreement and the other Contract Documents with respect to
the sublet Work. Turner's consent to any subletting shall not be
deemed to create any contractual relationship between Turner and
any subcontractor to whom the Work or any portion thereof is
sublet, and shall not vest any right or right of action in such
subcontractor against Turner.
ARTICLE XX. Turner shall have the right at any time by
written notice to the Subcontractor, to terminate this Agreement
Termination and require the Subcontractor to cease work hereunder, in which
of Agreement case, provide the Subcontractor be not then in default, Turner
shall indemnify the Subcontractor against any damage directly
resulting from such termination, except that the Subcontractor
shall not be entitled to anticipated profits on work unperformed
or on materials or equipment unfurnished.
ARTICLE XXI. The Subcontractor hereby guarantees the Work to
Guarantees the full extent provided in the Plans, Specifications, General
Conditions, Special Conditions and other Contract Documents.
The Subcontractor shall remove, replace and/or repair at its
own expense and at the convenience of the Owner any faulty,
defective or improper work, materials or equipment discovered
within ** from the date of the acceptance of the
Project as a whole by the Architect and the Owner or for such
longer period as may be provided in the Plans, Specifications,
General Conditions, Special Conditions or other Contract
Documents.
Without limitation by the foregoing, the Subcontractor shall
pay in addition for all damage to the Project resulting from
defects in the Work and all costs and expenses necessary to
correct, remove, replace and/or repair the Work and any other
work or property which may be damaged in the correcting,
removing, replacing or repairing the Work.
Accident ARTICLE XXII. The Subcontractor agrees that the prevention
Prevention of accidents to workmen engaged upon or in the vicinity of the
Work is its responsibility. The Subcontractor agrees to comply
with all Federal, State, Municipal and local laws, ordinances,
rules, regulations, codes, standards, orders, notices and
requirements concerning safety as shall be applicable to the
Work, including, among others, the Federal Occupational Safety
and Health Act of 1970, as amended, and all standards, rules,
regulations and orders which have been or shall be adopted or
issued thereunder, and with the safety standards established
during the progress of the Work by Turner. When so ordered, the
Subcontractor shall stop any part of the Work which Turner deems
unsafe until corrective measures satisfactory to Turner have been
taken, and the Subcontractor agrees that it shall not have nor
make any claim for damages growing out of such stoppages. Should
the Subcontractor neglect to take such corrective measures,
Turner may do so at the cost and expense of the Subcontractor and
may deduct the cost thereof from any payments due or to become
due to the Subcontractor. Failure on the part of Turner to stop
unsafe practices shall in no way relieve the Subcontractor of its
responsibility therefor.
This Subcontractor acknowledges the receipt of The Turner
Corporation's policies on "Safety" and "Drug and Alcohol Abuse".
Subject to applicable law this Subcontractor further agrees to be
bound to these policies as a part of the supplemental and special
conditions to the contract for construction of the project.
Liability ARTICLE XXIII. The Subcontractor hereby assumes entire
for Damage responsibility and liability for any and all damage or injury of
and Personal any kind or nature whatever (including death resulting therefrom)
Injury to all persons, whether employees of any tier of the
Subcontractor or otherwise, and to all property caused by,
resulting from, arising out of or occurring in connection with
the execution of the Work, or in preparation for the Work, or any
extension, modification, or amendment to the Work by change order
or otherwise. Except to the extent, if any, expressly prohibited
by statute and excluding from this indemnity such acts or
omissions, if any, of the party indemnified for which it is not
legally entitled to be indemnified by the Subcontractor under
applicable law, should any claims for such damage or injury
(including death resulting therefrom) be made or asserted,
whether or not such claims are based upon Turner's or the Owner's
alleged active or passive negligence or participation in the
wrong or upon any alleged breach of any statutory duty or
obligation on the part of Turner or the Owner, the Subcontractor
agrees to indemnify and save harmless Turner and the Owner, their
officers, agents, servants and employees from and against any and
all such claims and further from and against any and all loss,
cost, expense, liability, damage or injury, including legal fees
and disbursements, that Turner and the Owner, their officers,
agents, servants or employees may directly or indirectly sustain,
suffer or incur as a result thereof and the Subcontractor agrees
to and does hereby assume, on behalf of Turner and the Owner,
their officers, agents, servants and employees, the defense of
any action at law or in equity which may be brought against
Turner and/or the Owner, their officers, agents, servants or
employees upon or by reason of such claims and to pay on behalf
of Turner and the Owner, their officers, agents, servants and
employees, upon demand, the amount of any judgment that may be
entered against Turner and/or the Owner, their officers, agents,
servants or employees in any such action. In the event that any
such claims, loss, cost, expenses, liability, damage or injury
arise or are made, asserted or threatened against Turner and/or
the Owner, their officers, agents, servants or employees, Turner
shall have the right to withhold from any payments due or to
become due to the Subcontractor an amount sufficient in its
judgment to protect and indemnify Turner and the Owner, their
officers, agents, servants and employees from and against any and
all such claims, loss, cost, expense, liability, damage or
injury, including legal fees and disbursements, or Turner, in its
discretion may require the Subcontractor to Furnish a surety bond
satisfactory to Turner guaranteeing such protection, which bond
shall be furnished by the Subcontractor within five (5) days
after written demand has been made therefor.
In furtherance to but not in limitation of the indemnity
provisions in this Agreement, Subcontractor hereby expressly and
specifically waives any statutory or constitutional immunity it
enjoys from suits by its own employees or from limitations of
liability or recovery under workers compensation laws.
Compensation Before commencing the Work, the Subcontractor shall procure
and Liability and maintain, at its own expense, until completion and final
Insurance acceptance of the Work at least the following insurance from
insurance companies satisfactory to Turner.
1. WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY INSURANCE in
accordance with laws of the State in which the Work is
situated.
6
<PAGE> 39
** Confidential treatment requested pursuant to Rule 406
2. COMPREHENSIVE GENERAL LIABILITY INSURANCE INCLUDING COMPLETED OPERATIONS,
CONTRACTUAL LIABILITY INSURANCE AGAINST THE LIABILITY ASSUMED HEREINABOVE,
and including CONTRACTORS' PROTECTIVE LIABILITY INSURANCE if the
Subcontractor sublets to another all or any portion of the Work, with the
following minimum limits:
Combined Single Limit **
3. COMPREHENSIVE AUTOMOBILE LIABILITY INSURANCE covering all owned, non-owned
and hired automobiles used in connection with the Work, with the following
minimum limits:
Bodily Injury (including death) ** per accident
and Property Damage
Before commencing the Work, the Subcontractor shall furnish a
certificate, satisfactory to Turner, from each insurance company showing that
the above insurance is in force, stating policy numbers, dates of expiration,
and limits of liability thereunder, and further providing that the insurance
will not be canceled or changed until the expiration of at least thirty (30)
days after written notice of such cancellation or change has been mailed to and
received by Turner. Turner shall be named as an additional insured under these
policies of insurance.
If the Subcontractor fails to procure and maintain such insurance,
Turner shall have the right, but not the obligation, to procure and maintain the
said insurance for and in the name of the Subcontractor and the Subcontractor
shall pay the cost thereof and shall furnish all necessary information to make
effective and maintain such insurance.
BONDS
- -----
Article XXIV. The Subcontractor shall furnish to Turner a performance
bond in the amount of ** and a separate payment bond in the amount of
** , the form and contents of such bonds and the Surety or Sureties
thereon to be satisfactory to Turner.
SEVERABILITY
- ------------
ARTICLE XXV. In the event that any provision or any part of a
provision of this Agreement shall be finally determined to be superseded,
invalid, illegal or otherwise unenforceable pursuant to applicable laws by an
authority having jurisdiction, such determination shall not impair or otherwise
affect the validity, legality, or enforceability of the remaining provisions or
parts of provisions of this Agreement, which shall remain in full force and
effect as if the unenforceable provision or part were deleted.
ENTIRE
AGREEMENT
- ---------
ARTICLE XXVI. This Agreement constitutes the entire agreement between
the parties hereto. No oral representations or other agreements have been made
by Turner except as stated in the Agreement. This Agreement may not be changed
in any way except as herein provided, and no term or provision hereof may be
waived by Turner except in writing signed by its duly authorized officer or
agent. The marginal descriptions of any term or provision of this Agreement are
for convenience only and shall not be deemed to limit, restrict or alter the
content, meaning or effect thereof.
The said parties, for themselves, their heirs, executors,
administrators, successor and assigns, do hereby agree to the full performance
of all of the terms and provisions herein contained.
IN WITNESS WHEREOF the parties to those presents have hereunto set
their hands as of the day and year first above written.
TURNER CONSTRUCTION COMPANY
In the Presence of: (Witness)
X /s/ "illegible" By:/s/ P.R. CREIGHTON
--------------------------- ------------------------------
P.R. Creighton Vice President
In the Presence of: (Witness) FLOUR CITY ARCHITECTURAL METALS,
- ---------------------------- INC. Subcontractor
X /s/ JOHN H. BERNHARDT By:/s/ "illegible" President
--------------------------- ------------------------------
Official Title
Subcontractor's OHIO State Unemployment Ins. No.
---------------- ---------------------
(Insert State and Register No. for State in which the Work is to be performed)
Subcontractor's License No. -------------------
Insert License No., if any, for State or locality
in which the Work is to be performed)
Subcontractor's OHIO State Sales Tax Registration No.
---------------- ----------------
(Job Location)
Subcontractor's Federal I.D. No.
----------------
7
<PAGE> 40
In addition to Turner and the Owner, the Indemnified Parties throughout this
Agreement shall include
and any of their respective officers, agents, servants, or employees, and
affiliates, parents and subsidiaries.
Nothing contained in Article XXIII of this Agreement shall be deemed to obligate
the Subcontractor to indemnify Turner, the Owner or any of the other Indemnified
Parties, their officers, agents, servants, or employees, and affiliates, parents
and subsidiaries, against liability for damages or any other loss, damage or
expense sustained, suffered or incurred on account of death or bodily injury to
active persons or injury to property caused by the negligence or willful
misconduct of Turner, the Owner or any of the other Indemnified Parties, their
officers, agents, servants, or employees, and affiliates, parents and
subsidiaries, or other subcontractors directly responsible to Turner. Therefore,
if it is determined, by legal proceedings or agreement, that the Subcontractor
has no direct contributory or incidental negligence or other obligation to
Turner, the Owner, or any Indemnified Party, and that the Subcontractor is in no
way a proper party to a particular claim, then the Subcontractor shall not be
obligated to hold Turner, the Owner or any Indemnified Party harmless with
respect to said claim. However, until such determination is made by local
proceedings or agreement, or if the Subcontractor is found to have any degree of
direct or contributory negligence or if it is determined that the Subcontractor
is in any way or to any degree a proper party to said claim, then the
Subcontractor's obligations under all of the terms and provisions of Article
XXIII shall remain in full force and effect except to the extent caused by the
negligence of Turner, the Owner or any Indemnified Party.
8
<PAGE> 1
EXHIBIT 10.13
ALL SECTIONS MARKED WITH TWO ASTERISKS ("**") REFLECT PORTIONS WHICH
HAVE BEEN REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION BY FLOUR CITY INTERNATIONAL, INC. AS PART OF A REQUEST FOR
CONFIDENTIAL TREATMENT.
<TABLE>
[APEX LETTERHEAD]
PURCHASE ORDER
<S> <C> <C>
No. 1243
Please show P.O. number on
all invoices and packing lists
Job No. 32895
--------------------
Cost Code 8900
--------------------
Page 1 of
------- -------
To: Flour City Architectural Metals, Inc. Date: December 22, 1996
---------------------------------------- -------------------------------------
915 Riverview Drive Project: UC Davis Medical Center Tower II Main
---------------------------------------- ------------------------------------
Johnson City, TN 37601 2315 Stockton Blvd., Building 35
---------------------------------------- -------------------------------------
Att: Mr. John Bernhardt Corner of Staff Lane & Doctor Way
---------------------------------------- -------------------------------------
Phone: 423-928-2724 Fax: 423-928-0216 Sacramento, California 95817
---------------------------------------- -------------------------------------
[ X ] Confirmation Ship To: Project or Apex CWG Facility
-------------------------------------
- -------------------------------------------------------------------------------------------------
Ship Date Ship Via Terms Special Instructions
See Attached Your Pay when paid Notify Project Manager 48 hours in advance
Schedule Truck within 10 days, Net 60 of each delivery
- -------------------------------------------------------------------------------------------------
Quantity Received Description Price
- -------------------------------------------------------------------------------------------------
Furnish only the window, curtain wall, panels, sunscreen and feature mullions in accordance with
document inclusions, Apex CWG Scope of Work, Pricing Schedule, Additional Provisions, Scope
Exclusions and Assumptions and Clarifications (attached):
Apex CWG Scope of Work (9 pages)
Apex CWG Pricing Schedule (2 pages)
Apex CWG Additional Provisions, Scope Exclusions, Assumptions and Clarifications (5 pages)
FOR THE SUM OF **
FCAM potential incentives **
Accepted By:
----------------------------
Title:
----------------------------
Please direct all correspondence related to the project as follows: Apex Curtain Wall Group
41984 Rio Nedo, Suite 300
Temecula, CA 92590
Phone: 909-695-1993
Fax: 909-695-7533
- -------------------------------------------------------------------------------------------------
Note: 1. Ship no goods without a signed Purchase Order. Apex Curtain Wall Group, A Division of
2. Notify immediately of any delivery delay. The Edifice Group Ltd.
3. Send two (2) copies of every Invoice.
By /s/ DAVID FERROT
-----------------------------------
Dave Ferrot, Senior Project Manager
</TABLE>
<PAGE> 2
[APEX LETTERHEAD]
December 22, 1995
Page 1 of 9
PURCHASE ORDER #32895-1243
"U.C. DAVIS MEDICAL CENTER"
SACRAMENTO, CALIFORNIA
SCOPE OF WORK FOR GLAZED WINDOWS/CURTAIN WALLS,
INFILL PANELS, SUNSHADES AND FEATURE MULLIONS
A. DOCUMENT INCLUSIONS
1. Specifications: Dated August 19, 1995.
07430 Formed Metal Panels (pages 1-10)
*07900 Joint Sealers (pages 1-7)
08520 Aluminum Windows (pages 1-8)
*08800 Glazing (pages 1-11)
08920 Glazed Aluminum Curtain Walls, Window/Panels
and Entrances (pages 1-18)
*10210 Metal Wall Louvres (pages 1-4)
*Reference only
2. Apex CWG take-off elevations: Forty nine (49) pages dated October
1995.
3. Architectural sheets: Volume IIA A000 through A491 (plan)
Volume IIB A500 through A925
(Curtain wall package merged
Volumes IIA/B issued August 10,
1995 with applicable sheets for
exterior wall, deleting A400 and
A500 Series.)
4. Structural drawings. Volume I SC000 through SC012 (for
reference only)
S001 through S909 (for reference
only)
5. Addendas 1 through 4.
B. GENERAL SCOPE OF WORK
Fully design, engineer, furnish, fabricate, assemble sunscreens and accent
mullions, package and deliver to the facility or jobsite in Sacramento,
California aluminum framing, including mock-ups per inclusion documents.
<PAGE> 3
** Confidential treatment requested pursuant to Rule 406
"U.C. DAVIS MEDICAL CENTER"
APEX CURTAIN WALL GROUP, P.O. #32895-1243
DECEMBER 22, 1995
Page 2 of 9
C. ENGINEERING AND OTHER SERVICES BY VENDOR
1. Shop drawings: Provide per specification 07430, 08520 and 08920
for mock-ups and project, record and "as builts"*. (1 sepia or
reproducible + 7 prints per submittal.) Shop drawings to also
show glass, fasteners, hardware, sealant types, schedules and
surrounding conditions by others. Resubmitted shop drawings to
have all changes "clouded" and marked by delta designations.
2. Other drawings: Perform other drawings necessary by
specifications or as required, including but not limited to,
embed layout drawings for precast, curtain wall mullion
attachment anchor layout drawings, die drawings, piece
fabrication drawings for all components. Assembly drawings will
be limited in scope to show only vendor provided materials.
3. Structural calculations: Provide per specification 07430, 08520
and 08920 for mock-up and project, stamped by California
Professional Engineer for approval and record, inclusive of
sunscreen curtain wall reinforcement, sunscreens and attachment,
feature mullions, perimeter anchor/fasteners and precast embeds.
(6 copies.)
4. Certifications, product data, test reports and maintenance
manual: Provide per specification 07430, 08520 and 08920 for
mock-up and project for approval. Also include appropriate
instruction/recommendations for installation, maintenance and
cleaning, etc. for approval.
5. Design systems to meet the performance requirements of
specifications, codes and referenced documents. Importance
factors for public facilities are applicable.
6. Samples: Provide finish and other material samples as required
by specification for your work for approval. (8 each, unless
otherwise noted.)
* APEX CWG to provide a complete marked set of FCAM drawings
showing final field installation, being a reasonable amount and
of minor change (approximately ** ). If excessive, FCAM
reserves the right to be reimbursed for additional engineering
costs.
<PAGE> 4
"U.C. DAVIS MEDICAL CENTER"
APEX CURTAIN WALL GROUP, P.O. #23895-1243
DECEMBER 22, 1995
Page 3 of 9
7. Prompt technical and problem solving support of Apex CWG field
operations. Provide representative for mock up lab text.
8. FCAM shall commit a project manager with proper authority, resources
and time to perform this work.
9. Provide panel sizes/types as a check for Apex CWG within two (2) weeks
of approved drawings. Apex CWG will provide their glass take off of
sizes to FCAM for review, however, FCAM will have no responsibility
for the accuracy of such review. FCAM does take responsibility for
accuracy of their drawings. Apex CWG will also cross check molded
corner gaskets to glass.
10. Work shall be engineered to simplify and benefit Apex CWG field
operations. Means for anchoring, field hoisting and lifting will be
mutually agreed.
D. MATERIALS AND FINISHING BY VENDOR
1. Aluminum components. Provide complete systems meeting performance
criteria as specified, including sill framing member as noted,
integral curtain wall panels, anchor clips, perimeter "T" anchors,
secondary steel anchors to structure as shown, extrusions and other
miscellaneous shapes in thickness and shapes with drawing
requirements, die drawings, shop drawings and calculations. Evaluate
system capacity and reinforce as required generally to support spans.
Provide integral nested steel reinforcing for imposed loads of
railings and sunscreens as required. Include die fabrication and die
samples. Alloy shall be 6063-T5 or alloy and temper as may be required
for structural reasons. Include thermal isolator required to meet
performance criteria.
2. Sunscreens: Provide complete engineered internal aluminum framework,
reveals, closures, plate panels, anchor clips, and other miscellaneous
shapes in thickness and configurations per drawing requirements.
Sunscreens shall be pre-assembled frames complete with applied formed
plate and ready for field attachment to curtain wall.
<PAGE> 5
"U.C. DAVIS MEDICAL CENTER"
APEX CURTAIN WALL GROUP, P.O. #32895-1243
DECEMBER 22, 1995
Page 4 of 9
3. Feature mullions: Provide engineered, fabricated and assembled
formed aluminum plate feature mullions coped at sunscreens (integral
and non-integral), closures, sleeves, anchors, embeds and other
miscellaneous shapes in thickness and configurations per drawing
requirements. Feature mullions shall be pre-assembled to the greatest
extent possible, as mutually agreed by Apex CWG and FCAM. Material is
to be ready for field attachment to embedments or Apex CWG
installation to unit assemblies.
4. Aluminum vents: Provide assembled concealed casement vents integral
to windowall frames per architectural details and specifications.
Include stainless steel four bar hinges with limit stops, maintenance
key override and cast bronze handles. Provide glazing gaskets and
accessories.
5. Railings: Provide engineered, fabricated and assembled aluminum
pipe railing assemblies, inclusive of reinforcing, anchors, sleeves
and other miscellaneous shapes in thickness and configurations per
drawing requirements.
6. Finishing of aluminum components: For exposed to view interior and
exterior surfaces provide a two coat 70% Kynar 500 resin, PPG UC35500
"Alabaster," or approved equal by architect, and as required to
isolate dissimilar materials. Provide touch up paint as follows:
Twenty four (24) aerosol spray cans and four (4) quarts of ADS for
brush and/or spray applications.
7. Glazing accessories: Provide setting blocks, anti-walk blocks,
molded sponge gaskets, wedge gaskets, weatherstripping, sleeves,
baffles, etc. per specifications and as required. Properly size all
gaskets to ensure proper assembly and that all performance criteria
are met. For items furnished loose to jobsite or facility, provide 5%
extra (sponge and wedge gaskets as lineals).
8. Fasteners: Provide assembly and perimeter fasteners, for attachment
of FCAM item to FCAM's items only, per specifications also including
washers, isolators, etc. For items furnished loose to jobsite or
facility, provide 5% extra.
9. Miscellaneous materials: Provide reinforcing, pre-cast embeds at
punched windows, copings at FCAM's work only, flashing, isolators,
spacers, sealants for FCAM shop assemblies. Include sill and mull
framing members and expansion horizontal integral to the performing
system. Provide preparation for windowashing inserts by others.
<PAGE> 6
"U.C. DAVIS MEDICAL CENTER"
APEX CURTAIN WALL GROUP, P.O.#32895-1243
DECEMBER 22, 1995
Page 5 of 9
10. Mock-ups: Per specifications. Basis of mock-up materials shall be per
FCAM's drawing No. SK-M-1 dated 12/8/95 inclusive of curtain wall and
punched window; feature mullion and sunscreens if required by Architect
for aesthetic consideration.
11. Exclusions: Lab fees and field water tests, (except for retests due to
vendor's negligence or failures); perimeter sealants; shims; glass;
louvres, slab edge angle, unit assembly/glazing and fasteners.
E. FABRICATION BY VENDOR
Provide all cutting, notching, milling, punching, drilling, etc. as
required by drawings so that aluminum components are ready for assembly
and installation (also including clear holes/slots at perimeter
conditions). Fabrication is to be inclusive of all costs. Carry out
fabrication so as not to damage finish. Tolerances of fabrication shall
be as required for proper assembly, fit or as shown on fabrication
drawings.
F. ASSEMBLY BY VENDOR
1. Subassembly: Install clips, pull-in gaskets, isolators, pocket reducers,
end dams, steel reinforcing as applicable to panels component assembly,
sunscreen component assembly and accent mullion assembly to the fullest
extent possible as mutually agreed after drawings are approved.
G. QUALITY BY VENDOR
1. A detailed quality control/assurance program is to be established and
submitted for approval. This program will be inclusive of all activities
by FCAM and per specification.
2. Trial operate and/or fit all vents, hardware and assemblies to ensure
proper fit and operation. Make adjustments to all operating hardware
items before shipment to ensure their proper function.
3. Follow sealant manufacturer's recommendations for compatibility,
preparation, application, documentation, periodic testing, etc. and
forward written confirmation by manufacturer that all procedures are
being followed only as applicable to FCAM's sealant work.
<PAGE> 7
** Confidential treatment requested pursuant to Rule 406
"U.C. DAVIS MEDICAL CENTER"
APEX CURTAIN WALL GROUP, P.O. #32895-1243
DECEMBER 22, 1995
Page 6 of 9
4. FCAM shall be responsible for the proper sizing of all gaskets to
ensure the proper assembly of all components and to ensure that all
performance testing criteria has been satisfied.
5. All materials and work to be completed and shipped clean and free from
defects.
6. FCAM to ensure fit of snaps and interlock parts.
H. PACKING AND SHIPPING BY VENDOR
1. Provide adequate bundles, pallets or crates, blocking and bracing to
avoid damage during shipment, handling and on-site storage. Bundles,
pallets or crates shall be suitable for handling by forklift and crane
with a maximum weight of 2,200 lbs. FCAM to provide sketches for
approval by Apex CWG ** prior to shipping.
2. Shipping terms are FOB jobsite or facility in Sacramento, California.
Vendor to provide adequate insurance, etc. to cover replacement cost
for damaged or lost goods in a timely fashion as mutually agreed to by
Apex CWG and FCAM.
3. Racks, crates, boxes, parts and units to be labeled and identified
with mark numbers, quantities, etc. to correspond to the "master
packing list". Package materials as mutually agreed to between FCAM
and Apex CWG. Forty eight (48) hours prior to ship date, coordinate
with Apex CWG on delivery time and date and overnight deliver "master
packing list".
4. Provide flatbed or ragtop trucking for direct jobsite hoist sequence
for sunscreens and feature mullions. Trailers shall have a maximum
four (4) hour layover time for jobsite or facility delivery at no
additional charge to Apex CWG.
5. Upon receipt of each delivery, Apex CWG to advise FCAM, in writing,
and denote on Bill of Lading acknowledgment copy, and visible defects,
shortages or damages. Within five (5) working days of delivery date
Apex CWG is to advise FCAM, in writing, of any concealed damage or
defects upon unpacking so FCAM can inspect same and correct as needed.
<PAGE> 8
** Confidential treatment requested pursuant to Rule 406
"U.C. DAVIS MEDICAL CENTER"
APEX CURTAIN WALL GROUP, P.O. #32895-1243
DECEMBER 22, 1995
Page 7 of 9
I. SCHEDULE
1. Prepare mock-up shop drawings, calculations and other submittals per
schedule below. Present mock-up shop drawings and profiles to Apex CWG per
schedule, understanding that time of the essence, for review and comment.
2. Prepare production shop drawings, calculations and other submittals per
contract documents, and as mutually agreed to by Apex CWG and FCAM. Present
(1 copy) shop drawings to Apex CWG for review and comment prior to formal
approval to architect. Apex CWG will turn around advance set with any
revisions within seventy two (72) hours. When FCAM has incorporated these
changes we will submit for approval and we should base dates on a **
submissions time as stated in the specifications.
3. Participate with Apex CWG in establishing a schedule of shipments in
compliance with the mutually agreed schedule. Prepare all documents and
materials within this established time frame. FCAM shall be responsible to
meet all these agreed to dates or be responsible for additional costs
associated with FCAM meeting the schedule due to FCAM's non-compliance.
4. Production durations:
<TABLE>
<CAPTION>
Calendar Submit by
Incentive Award Days (for or Complete
Description Amount/Dates info only) Activity
- ----------- --------------- ---------- -----------
<S> <C> <C> <C>
A. Notice of project start by State
of California. ** **
B. Profile drawings. ** **
C. Mock-up drawings. ** **
D. Mock-up calculations. $ ** ** **
E. Produce die drawings
(from profile approval). ** **
F. Complete extrusion dies
and release for samples. ** **
G. Submit shop drawings and
calcs for punched openings. $ ** ** **
H. Submit shop drawings and
calcs for curtain wall. $ ** ** **
I. Receive returned set of punched
opening shop drwgs ** **
J. Rcv returned set of c/w shp drwngs ** **
</TABLE>
<PAGE> 9
** Confidential treatment requested pursuant to Rule 406
"U.C. DAVIS MEDICAL CENTER"
APEX CURTAIN WALL GROUP, P.O. #32895-1243
DECEMBER 22, 1995
Page 8 of 9
<TABLE>
<CAPTION>
Calendar Submit by
Incentive Award Days (for or Complete
Description Amount/Dates info only) Activity
- ----------- --------------- ---------- -----------
<S> <C> <C> <C>
K. Receive approved drawings
from architect ** **
L. Complete fabrication of
mock up material ** **
M. Apex to submit to OSHPOD ** **
N. Ship material to chamber $ ** ** **
O. Pass mock up testing ** **
P. Extrude, paint and fabricate job
material per the following sequence:
1. Deliver precast embeds
to precaster $ ** ** **
2. Complete shipment of all
sunscreens & accent mullions
for precast area $ ** ** **
3. Complete shipment of
punched openings for project $ ** ** **
4. Start shipments of c/w
components sequenced per
our schedule $ ** ** **
5. Complete all shipments of
c/w components $ ** ** **
</TABLE>
- ---------------
* All asterisked dates to be mutually agreed to by Apex CWG and FCAM based
on new erection information. Incentive dates are to be derived solely by
Apex CWG.
5. Apex CWG will authorize FCAM, in writing, to proceed with material
production based on architect's approval while OSHPOD is reviewing
drawings. Apex CWG will assume exposure for changes resulting from
OSHPOD review.
<PAGE> 10
** Confidential treatment requested pursuant to Rule 406
"U.C. DAVIS MEDICAL CENTER"
APEX CURTAIN WALL GROUP, P.O. #32895-1243
DECEMBER 22, 1995
Page 9 of 9
J. WARRANTIES BY VENDOR
Provide written manufacturer's warranties for Specification Section 08920,
1.11.B
A. ** general for materials and workmanship.
B. ** for Kynar paint finishes. ( ** year if available.)
Manufacturer's warranties will be provided to the extent available from the
manufacturer. Warranty periods commence on date of substantial completion
of project. Provide written warranties prior to final payment.
K. NO COMMUNICATION AGREEMENT
See Non-Compete Agreement document dated January 15, 1996.
<PAGE> 11
** Confidential treatment requested pursuant to Rule 406
[APEX LOGO]
December 22, 1995
Page 1 of 2
"U.C. DAVIS MEDICAL CENTER"
SACRAMENTO, CALIFORNIA
PRICING SCHEDULE
APEX CURTAIN WALL GROUP P.O. #32895-1243
BASE PRICING
1. 07430 Formed metal panels (engineered, finished/
fabricated system, FOB jobsite). $ **
2. 08520 Aluminum windows
08920 Glazed aluminum curtain walls, window/panels
and entrances.
A. Aluminum window/curtain walls, vents and
railings. (Engineering, mock-ups, finished/
fabricated/reinforced systems for sunscreens,
K.D. FOB jobsite Sacramento facility). $ **
B. Assembled sunscreens. (Engineering,
mock-ups, finished/fabricated/assembled,
prepared for attachment to reinforced curtain
walls and outrigger, FOB jobsite). $ **
C. Assembled feature mullions, embeds,
anchorage. (Engineering, mock-ups, finished/
fabricated/assembled FOB jobsite.) $ **
D. Glazed infill aluminum panels.
(Engineering, mock-ups, finished/fabricated/
assembled, FOB Sacramento facility.) $ **
-----------
$ **
[COMPANY LETTERHEAD]
<PAGE> 12
** Confidential treatment requested pursuant to Rule 406
December 22, 1995
Page 2 of 2
3. Total incentives per attached schedule, page 7 and 8,
Article I.4. indicating breakdown of amount and
payment due upon achieving a date or if delayed
through no fault of FCAM. $ **
LUMP SUM TOTAL $ **
Note: FCAM excluded sales tax. FCAM shall separately add and invoice for sales
tax, except for engineering, labor only functions and freight, to be
identified as a line item in schedule of values as submitted FCAM,
accepted by Apex CWG and as allowed by taxing authorities.
<PAGE> 13
[APEX CURTAIN WALL GROUP LOGO]
December 22, 1995
Page 1 of 5
PURCHASE ORDER 32895-1243
"U.C. DAVIS MEDICAL CENTER"
SACRAMENTO CALIFORNIA
ADDITIONAL PROVISIONS
1. Product descriptions shall be as follows: (For Information Only)
A. Curtain Wall - 3"x6 1/4" offset unitized aluminum system.
B. Punched Windows - 2 1/2"x5 1/4" aluminum framing with detached
sunshades and nineteen (19) inswing casements.
C. Aluminum Sunshades - Fabricated and assembled with all structural
support assemblies to curtain wall as specified.
D. Aluminum Wall Panels - .125 fabricated and assembled veneer panels for
attachment to stud substructure by others.
E. Aluminum Feature Mullions - .125 fabricated and assembled units for
jobsite installation.
F. Glaze In Aluminum Panel - .125 fabricated with perimeter extrusions
per approved shop drawings, KD to assembly facility.
G. Miscellaneous Aluminum, Parapets, Soffits, Railings, Canopies,
Closures per architectural document drawings and Apex CWG take off.
2. FCAM to provide thermal break at FCAM risk with CRF rating per contract
documents, until relieved by architectural approval. Upon approval, no
credit will be due to Apex CWG for this deletion.
3. Interior trims as integral to core framing are included as noted on
architectural documents.
4. Flashings will be provided integral to curtain wall as detailed.
5. Structural support and anchor per detail 5/A841 ninth floor level is
included in FCAM's scope of work.
6. FCAM to provide engineered products consistent with FCAM's approved profile
drawings submitted for shape approval, unless agreed to otherwise by Apex
CWG in writing.
[APEX CURTAIN WALL GROUP LETTERHEAD]
<PAGE> 14
** Confidential treatment requested pursuant to Rule 406
"UC Davis Medical Center"
Page 2 of 5
7. Wall closure per 7/A831 typically is excluded from FCAM's scope.
8. Aluminum back up angle at precast for curtain wall seismic joints is
excluded typically per 4/A832, 1B, 1C, 2/A837 etc.
9. Aluminum back up angle for drywall joint is excluded typically per 1/A839,
4/A839.
10. Soffit bracing and steel support framing marked "8A, by curtain wall
supplier" is specifically included.
11. Metal panels are included at the seismic "tunnel". Expansion joint
materials are excluded (studwork, drywall, etc.)
12. Progress payment shall be based upon a mutually acceptable schedule of
values, with separate line items for engineering, calculations, mock up,
dedicated material, fabricated material, other materials, including stored
off-site materials as inspected and approved by owner representative (cost
of inspection is by Owner), sales tax and material deliveries.
13. FCAM to participate in mediating the schedule within forty eight (48) hours
of written notification with any means necessary if FCAM is late for it's
scope of work through no fault of Apex CWG or the project team.
14. FCAM to provide corporate letter of guarantee at no additional charge to
Apex CWG.
15. Apex CWG shall have final assessment and make payment to FCAM within **
of being invoiced for meeting "the spirit of" the incentive dates
or if date is delayed through no fault of FCAM.
SCOPE EXCLUSIONS
1. Receipt, unloading, handling or distribution of shipped materials.
2. Assembly of fabricated materials except as qualified elsewhere in this
Purchase Order.
<PAGE> 15
"UC Davis Medical Center"
Page 3 of 5
3. Erection of materials. Also, field shims, and field caulking materials.
4. Assembly sealants for assembly work not performed by FCAM.
5. Glass or glazing.
6. Doors or any associated hardware.
7. Insulation or firesafing.
8. Windowashing tracks or tie-back buttons, or installation of same.
Reinforcement and preparation only is included.
9. Interior work of any type.
10. Flashing or sub-flashing materials, except if integral to and necessary
for the system's design.
11. Protective or strippable coatings on any material. However, FCAM to comply
with Section 7430, Paragraph 1.10, Item C wrapping and protecting all
parts.
12. Repair or replacement of our fabricated and shipped materials, except if
damaged in transit.
13. Performance mock-up test fees.
14. Assembly or erection of mock-up materials.
15. Separate and/or dedicated materials for visual mock-ups. However, Apex CWG
may request sunscreen and accent mullion assemblies earlier for
coordination with the precaster.
16. Field water test costs or personnel to attend same.
17. Permits or fees.
18. Attic stock.
<PAGE> 16
** Confidential treatment requested pursuant to Rule 406
"UC Davis Medical Center"
Page 4 of 5
19. Interior floor closure, ceiling trim or special edge trim not directly
identified as curtain wall components.
20. Liquidated damage assessment of any type.
21. Column covers, panel liners and closure panels not included in your scope
of work.
ASSUMPTIONS AND CLARIFICATIONS
1. FCAM will provide its standard materials and workmanship warranty of **
from date of material shipment.
2. Performance mock up testing costs will be limited to the engineering and
furnishing of fabricated curtain wall components; and associated travel and
per diem expenses of FCAM's personnel only. Mock up testing procedures will
conform to ASTM and AAMA procedures and guidelines.
3. Finishing of materials prior to or after fabrication of components will be
at FCAM's option. We have included finishing of aluminum surfaces exposed
to view only, including exposed edges.
4. Performance and quality standards of FCAM's system and fabricated materials
will meet or exceed manufacturing and industry standards, without
modifications.
6. The building structure and surrounding materials shall be sufficient to
accommodate the loadings and anchorage from our work, without any backing
plates, reinforcing, stiffening and bracing by FCAM except where
specifically called out.
7. FCAM to provide calculations stamped by its in-house registered California
P.E. Only if this procedure is deemed not acceptably by the Project
Architect or OSHPOD will FCAM stamp these documents with a Registered
California Structural Engineer.
<PAGE> 17
"UC Davis Medical Center"
Page 5 of 5
8. FCAM will not perform additional or extra work without written authorized
purchase change orders.
9. FCAM will not accept responsibility of delays not caused by its own
performance. If any "owner" compensible delays occur resulting in extra
costs as documented by actual invoices to FCAM, such costs will be
submitted by Apex CWG to Centex Golden for payment.
10. A joint check agreement as per California law can be set up later with the
General Contractor (Centex-Golden) for payment disbursement to FCAM, to be
utilized as per California law. (A $50.00 fee will be assessed FCAM if
agreement is used per application by Centex Golden.) Also note, once joint
check agreement is implemented Apex CWG has no further responsibility to
track or expedite payments and Apex CWG cannot be delayed shipments due to
non-payment by General Contractor.
____________________________
This Exhibit 10.14 does not include a certain Letter of Guarantee from
Armco, Inc., to Apex Curtain Wall Group dated February 29, 1996 wherein Armco
agreed to guarantee FCAM's performance under Purchase Order No. 1243. The
Company consents to furnish supplementally a copy of the foregoing letter to the
Commission upon request.
<PAGE> 1
EXHIBIT 10.14
ALL SECTIONS MARKED WITH TWO ASTERISKS ("**") REFLECT PORTIONS WHICH
HAVE BEEN REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION BY FLOUR CITY INTERNATIONAL, INC. AS PART OF A REQUEST FOR
CONFIDENTIAL TREATMENT.
TRADE CONTRACT
Agreement made this 19th day of May, 1997 by and between SWISS RE INVESTORS,
INC. with an office at 237 Park Avenue, New York, New York 10017 (the "Owner")
and Flour City Architectural Metals, Inc. with an office at 915 Riverview Drive,
Suite 1, Johnson City, TN 37601 (the "Trade Contractor").
The Owner engages the Trade Contractor to perform the work generally described
in Paragraph 3 hereof and the General Conditions for the Contract for
Construction (the "General Conditions") which are attached hereto and made a
part hereof (collectively, the "Work"). The Trade Contractor hereby agrees to
perform the Work in accordance with all the documents set forth in Paragraph 5
hereof (the "Contract Documents").
1. The Project is the construction of the Owner's new corporate headquarters
located in North Castle, New York.
2. The Owner has retained the services of a project manager (the "Project
Manager"), construction manager (the "Construction Manager") and design
professionals (the "Design Team") as described in the General Conditions.
3. The Trade Contractor shall provide and furnish all labor, materials, tools,
supplies, equipment, service, facilities, supervision, administration, and
all the items required by the Contract Documents for proper and complete
performance and acceptance of the CURTAINWALL SYSTEMS WORK in strict
accordance with the Contract Documents.
4. The Trade Contractor shall be paid for the Work the sum of ** (herein the
"Contract Price"). The Trade Contractor represents that it has inspected
the project site and has satisfied itself as to the condition thereof and
that the contract price is just and reasonable compensation for all the
work and for the Trade Contractor's assumption of the risk of all foreseen
and unforeseen risks, hazards, and difficulties in connection with the
performance of the Work.
5. The Contract Price includes all Federal, STATE*, County, Municipal and
other taxes imposed by law and based upon labor, services, materials,
equipment or other items acquired, performed, furnished or used for an in
connection with the Work, including but not limited to sales, use and
personal property taxes payable by or levied or assessed against the Owner
or the Trade Contractor. Where the law requires any such taxes to be stated
and charged separately, the total price of all items included in the Work
plus the amount of such taxes shall not exceed the Contract Price.
* REFER TO ADDITIONAL PROVISIONS/SCOPE OF WORK ITEM #B2
1
<PAGE> 2
6. The Contract Documents, sometimes hereinafter referred to
collectively as the "Trade Contract," are listed below and shall
constitute the Trade Contract.
A. This Trade Contract
B. General Conditions and all exhibits thereto
C. Additional Provisions/Scope of work and all
exhibits/attachments thereto
D. Rider 'A' Revised Contract Terms
The Trade Contractor is bound by the terms of all Contract Documents. The Trade
Contractor represents and agrees that it has carefully examined and understands
this Trade Contract and the other Contract Documents, has investigated the
nature, locality and site of the Work and the conditions and difficulties under
which it is to be performed and that it enters into this Agreement on the basis
of its own examination, investigation and evaluation of all such matters and
not in reliance upon any opinions or representations of Owner, the Project
Manager, the Construction Manager, or the members of the Design Team, or of any
of their respective officers, agents, servants, or employee
7. This Agreement, the provisions of the General Conditions and the other
Contract Documents are intended to supplement and complement each other
and shall, where possible, be thus interpreted. Definitions contained in
the General Conditions are applicable to this Agreement. If, however,
any provision of this Agreement irreconcilably conflicts with a
provision of the General Conditions and/or other Contract Documents, the
provision imposing the greater duty or obligation on the Trade
Contractor shall govern.
8. The Trade Contractor acknowledges it has reviewed the Contract
Documents and accepts them with full responsibility and liability for
the performance thereof, and the Owner, the Construction Manager, the
Project Manager and the members of the Design Team shall not have
responsibility or liability for the Trade Contractor's performance of
the Work.
9. The Trade Contractor acknowledges that it has carefully reviewed and
without reservation accepts each of the indemnification provisions which
are in the General Conditions.
2
<PAGE> 3
10. Time is of the essence in the commencement of the Work and the
performance of the Contract and the Work. The Trade Contractor shall be
liable for all direct and consequential damages arising out of any
failure to perform the Work in accordance with the terms and provisions
of the Contract Documents. The Trade Contractor shall commence the Work
when notified to do so by the Owner and shall diligently and
continuously prosecute and complete the Work and coordinate the Work
with the other work being performed on the Project. The Trade Contractor
shall perform the Work in accordance with the Project Schedule and any
amendments thereof as may be issued from time to time, and any other
scheduling requirements listed in this Agreement, so as not to delay,
obstruct, hinder or interfere with the commencement, progress or
completion of the whole or any part of the Work or other work on the
Project.
11. The Trade Contractor shall participate and cooperate in the development
of schedules and other efforts to achieve timely completion of the Work
and provide information for the scheduling of the times and sequence of
operations required for its Work to meet the Owner's overall schedule
requirement. The Trade Contractor shall continuously monitor the Project
Schedule so as to be fully familiar with the timing, phasing and
sequence of operations of the Work and of other work on the Project, and
shall execute the Work in accordance with the requirements of the
Project Schedule and any revisions thereto.
12. Without additional charge or expense to the Owner, the Trade Contractor
shall obtain and pay for all necessary permits and licenses pertaining
to the Work and shall comply with all federal, state, municipal and
local laws, ordinances, codes, rules, regulations, standards, orders,
notices and requirements, including but not limited to those relating to
safety, discrimination in employment, fair employment practices or equal
employment opportunity, and whether or not provided for by the Drawings,
Specifications, General Conditions, or other Contract Documents. The
Trade Contractor shall be also responsible for and correct, at its own
cost and expense, any violations thereof resulting from or in connection
with the performance of its Work. The Trade Contractor shall at any time
upon demand furnish such proof as the Owner may require showing such
compliance and the correction of such violations. The Trade Contractor
agrees to save harmless and indemnify the Owner, the Project Manager,
the Construction Manager and members of the Design Team from and against
any and all loss, injury, claims, actions, proceedings, liability,
damages, fines, penalties, costs and expenses, including legal fees and
disbursements, caused or occasioned directly or indirectly by the Trade
Contractor's failure to comply with any of said laws, ordinances, rules,
regulations, standards, orders, notices or requirements or to correct
such violations therefore resulting from or in connection with the
performance of Work.
3
<PAGE> 4
GENERAL CONDITIONS
for
CONTRACTS FOR CONSTRUCTION
for
SWISS RE CORPORATE HEADQUARTERS
NORTH CASTLE, NEW YORK
Owner:
Swiss Re Investors, Inc.
237 Park Avenue
New York, New York 10017
3/21/97
INITIALED:
SWISS RE
TRADE CONTRACTOR
<PAGE> 5
TABLE OF CONTENTS
Page
----
ARTICLE 1
DEFINITIONS................................................................ 1
1.1 Definitions................................................. 1
ARTICLE 2
CONTRACT DOCUMENTS......................................................... 4
2.1 Priority and Intent of Document............................. 4
2.2 Division of Work............................................ 5
2.3 Captions.................................................... 5
2.4 Recognized Meaning.......................................... 5
ARTICLE 3
THE TRADE CONTRACTOR....................................................... 6
3.1 The Trade Contractor and all Subcontractors Bound........... 6
3.2 Quality of Workmanship and Materials........................ 6
3.3 Trade Contractor's Responsibility for Legal Requirements.... 6
3.4 Trade Contractor's Responsibility to Detect and Avoid
Errors...................................................... 7
3.5 Cooperation with Other Trade Contractors.................... 7
3.6 Representations............................................. 8
3.7 Existing Conditions......................................... 9
3.8 Record ("As Built") Drawings................................ 9
3.9 Project Meetings............................................ 9
3.10 Warranties and Guaranties................................... 10
3.11 Performance Specifications.................................. 10
3.12 Work by Subcontractors...................................... 11
3.13 Discharge of Liens.......................................... 11
3.14 Royalties and Patents....................................... 12
ARTICLE 4
THE DESIGN TEAM, PROJECT MANAGER AND CONSTRUCTION MANAGER.................. 12
4.1 General..................................................... 12
4.2 Site Visits................................................. 12
4.3 Interpretation and Clarification............................ 13
4.4 Coordination................................................ 13
4.5 Changes and Substitutions.................................. 13
4.6 Final Review............................................... 14
4.7 Warranties, Guaranties and Manuals......................... 14
4.8 Cooperation with the Construction Manager, Design Team
Design and Limits of their Authority....................... 14
i
<PAGE> 6
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE 5
ADMINISTRATION, SUPERVISION AND SCHEDULING . . . . . . . . . . . . . . . 15
5.1 Trade Contractor's Work Force . . . . . . . . . . . . . . 15
5.2 Trade Contractor's Project Representative . . . . . . . . 16
5.3 Time of Performance . . . . . . . . . . . . . . . . . . . 16
5.4 Compliance with Time Schedules. . . . . . . . . . . . . . 17
ARTICLE 6
SHOP DRAWINGS, SAMPLES, PRODUCT DATA
AND OTHER SUBMISSIONS. . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.1 Approved Procedure for Shop Drawings, Samples
and Product Data. . . . . . . . . . . . . . . . . . . . . 18
6.2 Verification and Coordination . . . . . . . . . . . . . . 19
6.3 Review. . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.4 Trade Contractor's Responsibility . . . . . . . . . . . . 20
6.5 Compliance with Drawings and Specifications . . . . . . . 21
6.6 "Or Equal" Materials or Substitutions . . . . . . . . . . 21
6.7 Preliminary Submissions . . . . . . . . . . . . . . . . . 21
6.8 Testing . . . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE 7
CONSTRUCTION PRACTICES AT THE SITE . . . . . . . . . . . . . . . . . . . 22
7.1 Contractor's Responsibility for Construction Methods . . 22
7.2 Security and Safety . . . . . . . . . . . . . . . . . . . 23
7.3 Report of Accidents . . . . . . . . . . . . . . . . . . . 24
7.4 Trade Contractor's Responsibility in Emergencies . . . . 24
7.5 Signs . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE 8
INSPECTION, CORRECTION AND ACCEPTANCE OF THE WORK . . . . . . . . . . . 25
8.1 Tests and Inspections . . . . . . . . . . . . . . . . . . 25
8.2 Access to Work. . . . . . . . . . . . . . . . . . . . . . 26
8.3 Repair and Replacements of Defective Work . . . . . . . . 26
8.4 Stop Work Orders. . . . . . . . . . . . . . . . . . . . . 28
8.5 Further Construction Before Completion. . . . . . . . . . 28
8.6 Acceptance of Work. . . . . . . . . . . . . . . . . . . . 28
ARTICLE 9
CHANGES IN WORK. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
9.1 Unauthorized Changes Prohibited . . . . . . . . . . . . . 30
9.2 Change Orders . . . . . . . . . . . . . . . . . . . . . . 30
9.3 Overtime. . . . . . . . . . . . . . . . . . . . . . . . . 31
</TABLE>
ii
<PAGE> 7
Page
----
9.4 Compliance with Owner's Instructions and Notice. . . . . . . . 31
9.5 Payment or Credit for Scope Changes. . . . . . . . . . . . . . 31
9.6 Changed and Unknown Conditions . . . . . . . . . . . . . . . . 32
9.7 Time and Material, Cost-Plus and Unit Price Work . . . . . . . 33
ARTICLE 10
PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
10.1 Payment for Materials. . . . . . . . . . . . . . . . . . . . . 33
10.2 Progress Payments. . . . . . . . . . . . . . . . . . . . . . . 34
10.3 Final Payment. . . . . . . . . . . . . . . . . . . . . . . . . 35
10.4 Owner's Right to Withhold Payments . . . . . . . . . . . . . . 37
10.5 Trade Contractor's Books and Records . . . . . . . . . . . . . 39
10.6 Defective Work . . . . . . . . . . . . . . . . . . . . . . . . 39
10.7 Trust Funds. . . . . . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE 11
INSURANCE AND INDEMNITY . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
11.1 Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . 40
11.2 Indemnity. . . . . . . . . . . . . . . . . . . . . . . . . . . 40
ARTICLE 12
DEFAULT, TERMINATION, CLAIMS AND DISPUTES . . . . . . . . . . . . . . . . . . 41
12.1 Grounds for Termination. . . . . . . . . . . . . . . . . . . . 41
12.2 Effect of Termination. . . . . . . . . . . . . . . . . . . . . 43
12.3 Owner's Right to Perform Trade Contractor's
Obligations Without Termination. . . . . . . . . . . . . . . . 44
12.4 Notice and Waiver of Contractor's Claims . . . . . . . . . . . 44
12.5 Delay Claims . . . . . . . . . . . . . . . . . . . . . . . . . 45
12.6 Limitation of Action . . . . . . . . . . . . . . . . . . . . . 46
12.7 No Interruption for Dispute. . . . . . . . . . . . . . . . . . 46
12.8 Litigation Assistance. . . . . . . . . . . . . . . . . . . . . 46
iii
<PAGE> 8
ARTICLE 1
DEFINITIONS
1.1 Definitions. Terms used in this Agreement which are not expressly
defined herein shall have the respective meanings ascribed to them elsewhere in
the Contract Documents unless the context otherwise requires. Some of the
definitions used in this Agreement are as follows:
1.1.1 "Books and Records" means all books of account, bills,
vouchers, invoices, payrolls, payroll reports, purchase
orders, receiving documents, contracts, change orders,
maintenance and operating manuals, time books, daily job
diaries and reports, cost analyses made prior to and during
the course of the Work, cancelled checks, sales or excise
tax filings and returns, correspondence, and other documents
showing acts or transactions in connection with, or relating
to, or arising by reason of, the Project.
1.1.2 "Base Building" or "Core and Shell" means the perimeter
enclosure and common essential elements such as mechanical
systems, core toilets, electric systems, telephone (LAN)
closets, elevator, stairs and structure of the headquarters
office building.
1.1.3 "Building" means the Swiss Re headquarters office building
to be constructed on the Project site.
1.1.4 "Contract Documents" means this Trade Contract, all
agreements currently in effect or hereafter entered into
between the Owner and the Construction Manager, the Owner
and Trade Contractors and between Trade Contractors and
Subcontractors with respect to the Project, including the
General Conditions thereof, the completed Bid Form submitted
by the Trade Contractor, the drawings and specifications
prepared for the Project by the Design Team (the "Drawings
and Specifications") a list of which is annexed to the
special conditions issued by the Construction Manager and
all addenda, additions and modifications to any of the
foregoing.
1.1.5 "Construction Cost Estimate" means the estimates which shall
be prepared from time to time as work on the Project
proceeds.
1.1.6 "Construction Manager" means the Owner's designee who is
responsible for day-to-day management of the construction
site on behalf of the Owner.
1.1.7 "Design Team" means the design architect, the production
architect, the civil, mechanical, electrical, plumbing,
HVAC, and structural engineers, interior designer and other
design consultants retained by the Owner to perform design
services on the Project.
<PAGE> 9
The current members of the Design Team are identified in
Exhibit A which is annexed hereto.
1.1.8 "Employee(s)" means an officer, director, employee, partner,
agent, servant or representative.
1.1.9 "Excusable Delay" means any delay in the Work resulting from
Acts of God, fire, earthquake, explosion, unforeseen
conditions, epidemic, strike (other than a strike by
Employees of the Construction Manager), civil disturbance,
war, enjoining of the Work by a governmental body having
jurisdiction thereover, or any act(s) or omission(s) of the
Owner, the Design Team or the Construction Manager.
1.1.10 "Final Completion" means that the Owner has certified that,
except for minor or insubstantial details and routine
mechanical adjustments, the Work has been completed in
accordance with the Contract Documents.
1.1.11 "Fitout" means the interior construction of the elements of
the Building exclusive of the Core and Shell.
1.1.12 "Garage" means the parking garage to be constructed on the
Project site.
1.1.13 "Indemnitee(s)" means the Swiss Re Investors, Inc. and its
parent, subsidiary and affiliated corporations,
partnerships, and other entities including without
limitation Swiss Re America Holding Corporation, Swiss
Reinsurance America Corporation, and Swiss Re Life Insurance
Company, the Project Manager, the Production Architect and
other members of the Design Team, the Construction Manager
and the officers, directors, shareholders, partners and
employees of each of the foregoing.
1.1.14 "Laws" means each law, rule, regulation, requirement, order,
judgment, code, decree, or ordinance of every kind issued by
any government or public entity with jurisdiction over or a
protectible interest in the Project or the Work.
1.1.15 "Project" means the design and construction of the Building
and the Garage and all site work related thereto.
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1.1.16 "Project Manager" means the Owner's designee who is responsible
for comprehensive day-to-day management of the Project on behalf
of the Owner.
1.1.17 "Project Site" means any place or location where the Work is being
performed.
1.1.18 "Project Schedule" has the meaning as set forth in the Trade
Contract and any revisions thereto.
1.1.19 "Project Team" means the members of the Design Team, the Project
Manager, the Construction Manager, any other design or
construction consultants retained by the Owner, and the Trade
Contractors performing work on the Project.
1.1.20 "Retainage" means monies retained by the Owner from payments due
to trade contractors.
1.1.21 "Subcontractor" means a contractor or vendor furnishing services,
equipment, supplies or materials to the Project under a contract
with a trade contractor ("Subcontract").
1.1.22 "Substantial Completion" means the stage in the progress of the
Work when the Work or designated portion thereof is sufficiently
complete in accordance with the Contract Documents so the Owner is
able lawfully to occupy and reasonably use same for the conduct of
the Owner's business in the manner intended by the Owner.
1.1.23 "Trade Contractor" means a contractor performing part of the Work
for the Project pursuant to a contract with the Owner ("Trade
Contract") under the supervision of the Construction Manager.
1.1.24 "Work" means construction of the Project, including the furnishing
of all labor necessary to complete the construction of the Project
in accordance with the Contract Documents and all materials and
equipment incorporated in or to be incorporated in such
construction pursuant to the Contract Documents, including all
offsite work, mock up studies, tests, etc., and all services,
facilities, tools and equipment necessary or used to perform and
complete such construction.
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ARTICLE 2
CONTRACT DOCUMENTS
2.1 Priority and Intent of Document
2.1.1 In the event of a conflict between the provisions of a
Trade Contract and these General Conditions, the
provisions of the Trade Contract shall control.
2.1.2 To the extent that the requirements of the Drawings,
Specifications or any Special Conditions are inconsistent
with or more detailed or specific than these General
Conditions, the Trade Contractor shall follow the
Drawings and Specifications and any Special Conditions in
performing the Work. If there is a conflict or
inconsistency between the Drawings and Specifications,
Special Conditions or any Contract Documents, the Trade
Contractor shall comply with the more stringent
requirements contained therein.
2.1.3 The Trade Contractor shall follow the Contract Documents.
To the extent that there is a conflict between any
applicable legal requirement and any provisions of the
Contract Documents, the Trade Contractor shall conform to
the most restrictive requirement permitted by law.
2.1.4 Any reference to standard specifications of any society,
institute, association or governmental authority is a
reference to the standard specifications of such
organization that are in effect at the date of the Trade
Contractor's proposal unless otherwise indicated. If such
specifications are revised prior to completion of any part
of the Work to which such revision would pertain, the
Trade Contractor may, upon prior written consent of the
owner, perform such work in accordance with the revised
specifications. The standard specifications referred to
above, except as modified in the Specifications for the
Project, shall have full force and effect as though
printed in the Specifications.
2.1.5 The intent of the Contract Document is to include in the
Work all labor and materials, insurance, tools, equipment,
permits, licenses, taxes, approvals, transportation,
surveys, testing, field engineering and other professional
services (other than the services of the Design Team and
other consultants of the Owner) and any other items
required to execute and complete the Work satisfactorily
and in accordance with the Contract Documents, including
design
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work, preparation of documents, and filing of documents
when called for or if normally required by industry or
trade custom.
2.1.6 The Trade Contractor shall perform and complete the Work
in accordance with the intent and meaning of the Contract
Documents and shall perform all work reasonably inferable
therefrom; it being the intention that all work usually
performed by the trade covered by the Trade Contract and
necessary to produce the intended result be performed by
the Trade Contractor whether or not specifically covered
by the Contract Documents.
2.1.7 The Contract Documents are complementary and what is
called for by one shall be as binding as if called for by
all. If any conflicts or ambiguities are found in or
between the Drawings and Specifications, or among any of
the Contract Documents, they shall be brought to the
attention of the Design Team and the Owner immediately for
resolution.
2.2 Division of Work
The Specifications have generally been divided into Trade
Divisions and the Trade Divisions into sections for the purpose of
ready reference. A Trade Division or section may cover the Work of
more than one Trade Contractor, and the Work of a Trade Contractor
may be covered by more than one Trade Division or section. A Trade
Contractor shall be responsible for the performance of all its
Work, regardless of where it is described in the Specifications.
2.3 Captions
Captions, headings, cover pages and tables of contents contained
in the Contract Documents are inserted only to facilitate
reference and for convenience and in no way define, limit or
prescribe the scope, intent or meaning of any provisions of any of
the Contract Documents.
2.4 Recognized Meaning
Words and abbreviations that have well known technical or trade
meanings are used in the Contract Documents in accordance with
their recognized meanings, unless such terms are specifically
defined or unless their context clearly indicates a different
meaning.
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ARTICLE 3
THE TRADE CONTRACTOR
3.1 The Trade Contractor and all Subcontractors Bound
3.1.1 All services performed by the Trade Contractor or Subcontractors
shall be performed in the capacity of independent contractor and
not as agent.
3.1.2 The Trade Contractor shall be fully responsible to the Owner for
acts or omissions of persons directly or indirectly employed by
the Trade Contractor.
3.1.3 The Trade Contractor shall perform the Work in strict accordance
with the Contract Documents. The Trade Contractor shall not
depart form the scope of the Work as defined in the Contract
Documents unless authorized to do so pursuant to Article 9. The
Trade Contractor shall keep at the Project site and use for
construction only approved Drawings, Specifications, Shop
Drawings or other Documents issued or returned for construction
and identified as such.
3.2 Quality of Workmanship and Materials
The Trade Contractor shall perform the Work strictly in accordance with the
sound, workmanlike construction practices or other standard as may be
required by the Owner and shall use only high standards of workmanship, and
of structural and mechanical efficiency and integrity, at all times,
incorporating new materials of high quality, subject to the specific
requirements of the Drawings and Specifications.
3.3 Trade Contractor's Responsibility for Legal Requirements
3.3.1 In carrying out its obligations under the Contract Documents, the
Trade Contractor shall comply with all applicable Laws. The
Contractor represents that it is familiar with such Laws.
3.3.2 The Trade Contractor shall obtain, at its own expense, all
permits necessary in connection with the performance of its Work
and shall promptly furnish to the Owner a true copy of each
permit as issued. Notwithstanding the foregoing, the Owner shall
be responsible for obtaining the building permit for the Project.
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3.4 Trade Contractor's Responsibility to Detect and Avoid Errors
3.4.1 The Trade Contractor shall fully study, compare and
coordinate the Drawings and Specifications, the Project
Schedule and all Contract Documents, instructions,
approvals, disapprovals and other communications received
from the Owner.
3.4.2 The Trade Contractor shall immediately report to the Owner
any error, omission, inconsistency, construction
impracticality or other defect that may be apparent from
such review. The Trade Contractor shall cooperate fully and
in good faith with the Owner and other members of the
Project Team to resolve any such defect in a manner that
shall not result in an increase in the Trade Contract Price
or a delay in the progress in the Work. In no event shall
the Trade Contractor make any claims against the Owner or
any member of the Project Team on account of any errors,
omissions or inconsistencies contained in the Drawings,
Specifications or other Contract Documents.
3.5 Cooperation with Other Trade Contractors
3.5.1 The Owner may engage other Trade Contractors to perform Work
in connection with the Project, subject to these General
Conditions. More than one Trade Contractor may be engaged to
perform Work in a single trade. The Trade Contractor shall
cooperate with and fully coordinate its Work with the Work
of the other contractors.
3.5.2 The Trade Contractor shall immediately notify the Owner of
any deficiency observed in the Work of any other contractor
before performing any of the Trade Contractor's own Work
that may be affected by such deficiency; and the Trade
Contractor shall not, without the Owner's approval, proceed
with or continue the affected Work until such deficiencies
have been rectified.
3.5.3 Responsibility for the coordination of the Work in
connection with the Project rests with the Trade Contractor
and the other Trade Contractors. Neither the Owner, the
Project Manager, the Construction Manager nor the members of
the Design Team shall be liable to the Trade Contractor for
any damages, costs, expenses, liabilities, or losses which
the other Tract Contractor may sustain or incur as a result
of the failure of any Trade Contractor or Subcontractor to
coordinate its work with the work of the Trade Contractor
and the other Trade Contractors and
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Subcontractors. Nothwithstanding the foregoing, the Owner
reserves the right to direct and coordinate the Work as it deems
necessary. The Owner has no obligation to exercise this right;
however, the Trade Contractor shall follow any directives issued
by the Owner to achieve coordination of the Work.
3.6 Representations
The Trade Contractor represents that:
(a) The Trade Contractor is bondable for an amount up to the price of
the Work. The Owner may, at any time during the performance of
the Work, request that the Trade Contractor secure at Owner's
expense, ,for a commercial surety acceptable to the Owner a bond:
(i) for the due and complete performance of the Trade Contractors
obligations hereunder, and (ii) for the timely payment of all
charges for labor, services, and material furnished for the
prosecution of the Work. Such bond shall be for a sum equal to
the amount of the Trade Contract, shall be in a form acceptable
to the Owner and shall be delivered to the Owner within seven (7)
days after being requested. If the Trade Contractor is requested
to furnish a bond at anytime during the job and fails to obtain
it, such failure will constitute a material breach by the Trade
Contractor, entitling the Owner to terminate the Trade
Contractor's performance;
(b) Any temporary and permanent Work required by the Contract
Documents can be satisfactorily constructed, and the such
construction will not injure any person or damage any property;
(c) The Trade Contractor has carefully examined the Contract
Documents and the Site and, from the Trade Contractor's own
investigations, is satisfied as to the nature and location of the
Work, the character, quality and quantity of surface and
subsurface materials likely to be encountered, the character of
equipment and other facilities needed for the performance of the
Work, the general and local conditions including easements, and
all other conditions or items which may affect the Work; and
(d) The Trade Contractor accepts full responsibility for all
conditions at the Site that may affect the Trade Contract of
Trade Contractor's performance.
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3.7 Existing Conditions
3.7.1 Before proceeding with the Work, the Trade Contractor will
investigate, verify and accurately check all previous and
surrounding work and determine the correctness of the same;
failure on its part to detect or report discrepancies will
relieve the Owner of liability from any and all claims to recover
cost, expense, loss or damage resulting therefrom. The Trade
Contractor shall take, determine, investigate and verify all
field measurements, dimensions, field construction criteria and
Site conditions for the performance of the Work and shall check
and coordinate the information contained in the Contract
Documents and the boring logs which shall be available for
inspection with the requirements of the Work. The Trade
Contractor shall be responsible for determining the exact
location of, and to verify, the spatial relationships of the
Work.
3.8 Record ("As Built") Drawings
3.8.1 The Trade Contractor shall keep on file at the Project site two
complete updated copies of the Contract Documents as issued for
construction and shall accurately note on such Contract Documents
all changes, revisions and additions thereto approved by the
Owner.
3.8.2 The Trade Contractor shall clearly and accurately show on such
Drawings the Work as installed and shall deliver the Drawings, as
so conformed and marked to show the Work "as built" ("As-Built
Drawings"), to the Owner upon the acceptance of the Work
following final inspection. The final As-Built Drawings furnished
by the Trade Contractor shall be on CADD discs in such format as
the Owner may request. Failure to furnish As-Built Drawings on
CADD as required shall result in a deduction from the final
payment due the Trade Contractor to enable the Owner to obtain
CADD drawings from another party.
3.9 Project Meetings
The Trade Contractor's project manager (appointed pursuant to Paragraph
5.1.2) shall attend and participate in all regular progress meetings and
special meetings as called by the Owner. Unexcused failure to attend such
meetings shall be deemed a default, entitling the Owner to the relief
provided by paragraph 12.1. The representatives of the Trade Contractor and
its subcontractors in attendance at any such meeting shall be senior
executives and shall have full authority to act
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with respect to all matters coming before the meeting.
3.10 Warranties and Guaranties
3.10.1 The Trade Contractor warrants and guarantees that all materials
and equipment furnished under the Contract Documents shall be
new, unless otherwise specified, and that all Work shall be of
first-class quality, free from improper workmanship and
defective materials and in conformance with the Contract
Documents.
3.10.2 The warranties and guaranties provided for in Paragraph 3.10.1
and in the Specifications shall be in addition to and not in
limitation of (a) the Trade Contractor's other obligations under
the Contract Documents or under applicable Laws, or (b) any
other rights and remedies available to the Owner under the
Contract Documents or under applicable Laws.
3.11 Performance Specifications
3.11.1 When work is described in the Drawings and Specifications
schematically or in a performance specification, the Trade
Contractor shall be responsible for the detailed design of such
Work in compliance with all applicable Laws and in conformity
with the architectural, structural and other requirements
indicated by the Drawings and Specifications. The detailed
design shall be subject to review and release for construction
by the Owner and its designers, and the Trade Contractor shall
prepare and submit such design, including progress documents, in
accordance with the Project Schedule. At the Owner's option, the
Trade Contractor shall not commence any Work referred to in this
Section until the required detailed design has been finally
accepted by the Owner.
3.11.2 If the Trade Contractor is responsible for detail design, it
shall prepare and file all drawings and other information
necessary for approval by governmental authorities with
jurisdiction over the Project, and shall procure such approval.
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3.12 Work by Subcontractors
3.12.1 Selection of Subcontractors
(a) Before any subcontractor is employed by any Trade
Contractor, the name of such Subcontractor shall be
submitted to the Owner in writing. The Owner shall then
have ten days to object to the Subcontractor, in the
absence of which the Subcontractor may be employed. An
objection by the Owner to a proposed Subcontractor shall
not result in an increase of the Price of the Work.
(b) The Owner's failure to object to a Subcontractor shall not
constitute a waiver of any rights of the Owner to insist on
the strict performance of the Trade Contract or any
Subcontracts.
3.12.2 All Subcontracts shall provide that the Subcontractor shall be
bound by all of the Contract Documents to the same effect as if
the Subcontractor were the Trade Contractor. The Trade
Contractor shall be fully responsible for all the work and acts
of its subcontractors and materialmen and all persons either
directly or indirectly employed by any of the foregoing.
3.12.3 The Subcontractors shall not have any claim or cause of action
against the Project, the Owner, the Project Manager, any member
of the Design Team, or other person representing or acting on
their behalf arising out of the Subcontracts or other
transactions.
3.12.4 The Subcontractors shall look only to the Trade Contractor for
payment or other remedy in the event of any dispute arising out
of the Contract Documents.
3.12.5 After employment of the Subcontractor, the Trade Contractor
shall submit to the Owner, two executed copies of every
Subcontract or purchase order and a copy of every revision,
amendment, modification or cancellation executed or issued by
the Trade Contractor with respect thereto.
3.13 Discharge of Liens
The Trade Contractor shall without any delay cause the discharge of any
mechanic's liens against the Project filed by any of its laborers,
Subcontractors or materialmen, and shall cause any such lien to be
discharged of record within fifteen days after the notice of filing
thereof by payment, deposit, bond, order by
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a court of competent jurisdiction or otherwise. If the Trade Contractor
shall fail to cause such lien to be discharged of record within such
period, the Owner may do so. Any amount paid by the Owner for such
purpose, including all costs and expenses, including reasonable attorneys
fees, plus interest at 1% per month, shall be paid by the Trade
Contractor to the Owner on demand. The Owner may at any time also require
the Trade Contractor to furnish a bond or other security, in a form and
amount satisfactory to the Owner as security for the payment of any such
liens.
3.14 Royalties and Patents
The Trade Contractor shall pay all royalties and license fees. The Trade
Contractor shall defend suits or claims for infringement of patent rights
and shall hold the Owner, the Project Manager, the Construction Manager
and the members of the Design Team harmless from loss on account thereof,
but shall not be responsible for such defense or loss when a particular
design, process or product of a particular manufacturer is required by
the Contract Documents. However, if the Trade Contractor has reason to
believe that the required design, process or product is an infringement
of a patent or copyright, the Trade Contractor shall be responsible for
such loss unless such information is promptly furnished to the Owner.
ARTICLE 4
THE DESIGN TEAM, PROJECT MANAGER
AND CONSTRUCTION MANAGER
4.1 General
The responsibilities and authority of the Design Team, the Construction
Manager, and the Project Manager are described in this Article and in the
parties' respective agreements. This description is provided for the Trade
Contractor's information only and does not give the Trade Contractor any
contractual rights against any member of the Design Team, the Project
Manager or the Construction Manager. The Duties of the Design Team, the
Construction Manager and the Project Manager may be changed without the
Trade Contractor's consent.
4.2 Site Visits
To the extent required by the Owner, together with the Project Manager and
Construction Manager, the members of the Design Team shall keep the Owner
informed of the progress and quality of the Work and shall endeavor to
guard the Owner against defects and deficiencies in the Work. No report by
a member of the Design Team shall constitute acceptance of any Work. The
Design Team, the
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Project Manager and the Construction Manager shall not be responsible for
construction means, methods, techniques, sequences or procedures, or for
safety precautions and programs in connection with the construction of
the Project or for any failure of the Trade Contractor to comply with the
Contract Documents.
4.3 Interpretation and Clarification
Members of the Design Team shall interpret and, as necessary, clarify
Drawings and Specifications and prepare and issue supplemental drawings
and specifications when requested to do so by the Owner. The Construction
Manager shall forward such information and documents to the Trade
Contractor.
4.4 Coordination
The Trade Contractor has full responsibility for coordinating its work
with the work of other trades. The Construction Manager and the Design
Team shall monitor the preparation of composite shop drawings and shall
assist the Owner and the Trade Contractor in resolving any conflicts
caused by juxtaposition of the Work of the various trades that may become
apparent from the composite shop drawings.
4.5 Changes and Substitutions
All requests by the Trade Contractor for changes in the Work or
substitution of materials shall be submitted to the Owner through the
Construction Manager and shall be subject to the approval of the Owner.
When the Owner forwards such requests to appropriate members of the
Design Team, such members of the Design Team shall review them and act as
follows:
(a) If such changes or substitutions can be performed without
delaying progress of the Work and without increase in the
Trade Contract Price, the Construction Manager shall recommend
whether or not such request should be approved; or
(b) If such changes shall result in a delay of the Work or a
change in the Trade Contract Price, the Construction Manager
shall:
(i) advise the Owner of the extent of such delay and the
cost of such change or substitution and the amount of
the extra cost, or credit due, to the Owner, resulting
therefrom; and
(ii) recommend whether or not such change or substitution
should be approved.
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4.6 Final Review
The Trade Contractor shall advise the Owner when it believes that its Work
or a major portion thereof is substantially complete. Upon the Owner's
request, the Construction Manager and/or appropriate members of the Design
Team shall review such elements of the Work which appear to be complete
and shall advise the Owner whether or not such elements have been
completed in accordance with the Drawings and Specifications.
The Construction Manager and/or appropriate members of the Design Team
shall continue to inspect such element of Work as requested by the Owner
until it has been fully completed in accordance with the Drawings and
Specifications. When such Work has been fully completed in accordance
with the Drawings and Specifications, the Construction Manager and/or
appropriate members of the Design Team shall so advise the Owner.
4.7 Warranties, Guaranties and Manuals
The appropriate members of the Design Team and the Construction Manger
shall review all warranties, guaranties, certificates, operating manuals,
record drawings and other documents required under the Contract Documents
and shall advise the Owner whether or not they meet the requirements of
the Contract Documents.
4.8 Cooperation with the Construction Manager, Design Team
Design and Limits of their Authority
4.8.1 The members of the Design Team have no authority to incur
costs on behalf of the Owner. The Trade Contractor shall
notify the Owner and the Construction Manager in writing,
within five (5) days of any action of direction by the Design
Team or the Construction Manager which may increase the Trade
Contract Price.
4.8.2 The Trade Contractor shall cooperate with and provide all
necessary information to the Construction Manager, but neither
the Construction Manager nor the members of the Design Team
are authorized to modify or amend the Contract Documents; and
no communication with them or advise or instruction given by
them shall relieve the Trade Contractor of its obligations
under the Contract Documents. The Trade Contractor, the
members of the Design Team and the Construction Manager shall
keep the Owner fully informed of all communications with each
other by sending copies thereof to the Owner.
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ARTICLE 5
ADMINISTRATION, SUPERVISION AND SCHEDULING
5.1 Trade Contractor's Work Force
5.1.1 The Trade Contractor shall maintain on the Project at all
times a sufficient work force to carry out the Trade
Contractor's obligations in full and in an efficient and
timely manner. the Trade Contractor shall employ only fully
competent, skilled, reliable and honest workers who shall work
in harmony with other workers. The Owner shall have the right
to require the Trade Contractor to remove immediately and
permanently any employee or agent the Owner deems incompetent
or a hindrance to the proper progress of the Work.
5.1.2 The trade contractor acknowledges that the Owner may enter
into a site-wide labor agreement with all of the trades
performing work on the Project (the "Project Labor
Agreement"). The Trade Contractor agrees that, in such event,
it shall perform the Work on the Project in accordance with
the terms of such Project Labor Agreement.
5.1.3 The Trade Contractor shall appoint a fully competent,
experienced, reliable, diligent and honest supervisory staff,
who shall be responsible for the administration, coordination
and superintendence of the Work. The supervisory staff shall
include a project manager, a field superintendent and such
foremen as are necessary to carry out the Work, all of whom
shall be subject to the Owner's approval and shall be present
at the Site at all times while the Work is in progress. The
Trade Contractor shall not remove the project manager or field
superintendent without the Owner's prior consent and shall
replace either at the request of the Owner if his or her
performance is unsatisfactory to the Owner. Any successor must
be of an equal or higher standard of competency than the
person replaced and shall be subject to the Owner's approval
and to replacement as provided herein.
5.1.4 The Trade Contractor shall not employ any labor or materials
or allocate any portion of the Work to any trade or enter into
any agreement relating to employment of labor if such
employment, allocation or agreement may tend, in the opinion
of the Owner, to cause strikes, work stoppages, delays, or
other interference with the smooth progress of the Work.
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5.1.5 If a jurisdictional or other dispute involving the Trade
Contractor or its work force results in or threatens a work
stoppage or delay or other interference with the Work, the Trade
Contractor shall promptly take all measures available to it to
avoid any delay in the progress of the Work and to remove the
cause of such work stoppage of interference, including, but not
limited to, the seeking of injunctive relief.
5.1.6 The Trade Contractor shall maintain at all times the good order
and discipline of its employees and other persons under its
direction and control or present at the Project site in
connection with it Work, and shall adopt and enforce at all times
reasonable and effective regulations with respect to safety, fire
prevention, smoking, sanitation, noise, firearms, the use of
alcoholic beverages and drugs, and other activities that shall or
may constitute a danger of life, health or property or create a
dangerous or unsanitary condition or working environment.
5.2 Trade Contractor's Project Representative
5.2.1 The Project Representative appointed pursuant to Paragraph 5.1.3
shall receive all instructions, approvals, disapprovals and other
communications on behalf of the Trade Contractor and shall be
responsible for delivering all communications from the Trade
Contractor to the Owner through the Construction Manager.
Communications shall be effective only when delivered by, or to,
the representative so designated who shall have full authority to
act for and on behalf of the Trade Contractor.
5.2.2 All communications of Subcontractors concerning the Work shall be
directed only to the Trade Contractor, who shall be responsible
for all communication with the Owner.
5.3 Time of Performance
5.3.1 The Trade Contractor shall commence, perform and complete the
Work in strict accordance with any milestone dates or time
requirements set forth in the Trade Contract or established in
any schedule issued in accordance with Paragraph 5.3.2. TIME IS
OF THE ESSENCE OF THE TRADE CONTRACTOR'S PERFORMANCE OF ITS
OBLIGATIONS UNDER THE CONTRACT DOCUMENTS. The Trade Contractor
shall be responsible for all direct and indirect damages arising
from delay in performing or completing the Work, including legal
fees and
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disbursements incurred by the Owner (whether incurred in
defending claims arising from such delay or in seeking
reimbursement and indemnity from the Trade Contractor and its
surety hereunder or otherwise). The Trade Contractor and its
surety shall and does hereby agree to compensate the Owner, the
Project Manager, the Construction Manager and members of the
Design Team for and indemnify them against all such costs,
expenses, damages and liability.
5.3.2 Subject to the Owner's approval, the Construction Manager shall
draw and keep current a schedule showing the times at which the
principal operations of each individual trade on the Project are
to be performed. Each Trade Contractor shall coordinate with the
Construction Manager in the preparation of such schedule and
shall promptly furnish to the Construction Manager any scheduling
information that the Construction Manager requires. The
Construction Manager shall review the schedule from time to time
in the light of actual conditions, subject to the Owner's
approval. All Trade Contractors shall perform their Work in
accordance with the schedule as prepared and revised from time to
time by the Construction Manager and approved by the Owner.
5.4 Compliance with Time Schedules
If, in the opinion of the Owner, the Trade Contractor fails to adhere to
the time schedule provided pursuant to Paragraph 5.3.2, in addition to any
other remedies the Owner may have, the Owner, through the Construction
Manager, may direct the Trade Contractor to work such overtime or add such
additional manpower as may be necessary to comply with the time scheduling,
and all costs incurred on account of such direction shall be borne entirely
by the Trade Contractor. Should the Trade Contractor fail to make up for
the time lost by reason of such delay, the Owner shall have the right to
cause other Trade Contractors to work overtime and to take whatever other
action it deems necessary to avoid delay in the completion of the Work and
of the Project, and the cost and expense of such overtime and/or such
action shall be borne by the Trade Contractor.
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ARTICLE 6
SHOP DRAWINGS, SAMPLES, PRODUCT DATA AND OTHER SUBMISSIONS
6.1 Approved Procedure for Shop Drawings, Samples and Product Data
6.1.1 Schedule for Submission and Review
The Trade Contractor shall cooperate with and provide all
necessary information to the Owner through the Construction
Manager in the preparation of a detailed schedule for preparation
and submission of shop drawings, samples and product data. The
schedule shall provide for appropriate turnaround times for both
preparation and review.
6.1.2 Submissions by the Trade Contractor
(a) Before performing any of the Work, the Trade Contractor shall
submit to the Construction Manager, or as otherwise directed by
the Owner, shop drawings, samples and product data for all
elements of the Work as required, showing or describing precisely
the Work to be performed. The shop drawings shall show the
arrangement of all elements of the Work in relation to the
architectural, mechanical, electrical, structural and/or other
drawings and shall provide for the proper functioning of all
systems and adequate access for maintenance.
(b) Each shop drawing shall contain the following information:
(1) The name of the Project.
(2) The name of the Trade Contractor or Subcontractor.
(3) The name of the firm or organization preparing the shop
drawing.
(4) The date of submittal.
(5) The number of the Shop Drawing.
(6) The number and date of each revision, if any.
(7) The applicable section of the Specifications.
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(8) The name of the person and/or persons who prepared
the shop drawing.
(c) Each sample shall be labeled, tagged or clearly identified
and shall be accompanied by a letter of transmittal
containing the following information:
(1) The name of the Project.
(2) The name of the Trade Contractor of Subcontractor.
(3) The name of the Subcontractor and/or supplier,
manufacturer, fabricator or processor.
(4) The trade designation and the grade or quality of the
material or product.
(5) The date of submittal.
(6) The specific identification of each sample.
(7) A precise reference to the section of the
Specifications wherein the material, product or
element of the Work is specified.
6.1.3 Form of Submissions
Shop drawings, samples and product data shall be in such form
and shall contain such detail as the Contract Documents shall
require for purposes of review. The Owner may specify the
particular procedures and requirements for the submission and
review of shop drawings, samples and product data. The quality
of the submissions shall be such that all prints, sepias or
copies submitted are clearly readable to the smallest detail.
Shop drawings shall be respoducible.
6.2 Verification and Coordination
6.2.1 Before submitting shop drawings, samples or product data, the
Trade Contractor shall verify all materials, field measurements
and construction criteria relating thereto and shall fully
coordinate its Work within the work of other contractors that
might be affected thereby.
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6.3 Review
The Trade Contractor shall not perform any portion of the Work covered
or affected by shop drawings, samples or product data until they have
been reviewed and returned to the Trade Contractor in accordance with
this Article 6. Such submittals shall be annotated in a manner similar
to the following:
(a) Reviewed and Accepted - means reviewed and acceptable
for construction, fabrication and/or manufacture subject
to the provision that the work as finally installed
shall be in accordance with the requirements of the
Contract Documents. Final acceptance of the Work shall
be contingent upon such compliance.
(b) Reviewed and Accepted as Noted - means, unless otherwise
noted on the drawings, reviewed and acceptable for
construction, fabrication and/or manufacture, subject to
the provisions that as finally installed it shall be
carried out in compliance with all annotations and/or
corrections indicated, and in accordance with the
requirements of the Contract Documents. Final acceptance
of the Work shall be contingent upon such compliance.
Drawings and product data must be resubmitted for the
Owner's and Design Consultant's record file with all
corrections clearly made in accordance with annotations
and corrections.
(c) Not Accepted, Revise and Resubmit - means that
deviations from the requirements of the Contract
Documents exist in the submittal. No work based on such
drawings shall be constructed, fabricated, manufactured
or installed. The Trade Contractor shall revise the
drawings to comply with the annotations, and pursuant to
all requirements of the Contract Documents, shall
resubmit the drawings in accordance with the Shop
Drawing Schedule.
6.4 Trade Contractor's Responsibility
The review and approval of shop drawings, samples and product data by
the Owner, the Construction Manager and the Design Team shall not
relieve the Trade Contractor of its responsibility to perform the Work
in accordance with the Contract Documents and schedules. Neither the
Owner nor the Design Team shall be responsible for any errors or
omissions or other defects in shop drawings, samples or product data.
The Trade Contractor shall not be relieved of responsibility therefor by
the Owner's, the Construction Manager's or the Design Team's review of
any submission.
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6.5 Compliance with Drawings and Specifications
Shop drawings, samples and product data shall meet the requirements of
the Drawings and Specifications and applicable Laws. The Trade Contractor
shall include with any submission of shop drawings, samples and product
data, a clear description of the extent, if any, to which such
submissions do not meet those requirements, and the reasons therefor. In
the event the Trade Contractor fails to identify and describe deviations
from the Drawings and Specifications, it shall remain responsible for
failing to adhere to the Contract Documents.
6.6 "Or Equal" Materials or Substitutions
6.6.1 Any request by the Trade Contractor for the approval of
equivalent materials when the Contract Documents provide for
the use of a specified item "or equal" shall be in the form of
the submission of shop drawings, samples or product data
pursuant to this Article 6 and shall be accompanied by
sufficient information to assure the Owner that the proposed
substitution (a) is equal in quality, aesthetic effect and
serviceability to the specified item, (b) shall not require
modification of the Contract Documents or changes in other
work, (c) shall not result in a cost disadvantage to the
Owner, (d) shall be protected by guaranties and warranties at
least as stringent as those originally provided for, and (e)
shall be in conformity with the intent of the Contract
Documents.
6.6.2 If specified materials are not available or if the Trade
Contractor believes that alternative materials would better
meet the Owner's requirements, the Trade Contractor shall
submit a request for substitution of materials in accordance
with Paragraph 6.6.1
6.6.3 The decision whether or not to accept an equivalent item or a
substitution shall be entirely within the discretion of the
Owner.
6.6.4 Any fees of members of the Design Team or other costs and
expenses incurred by the Owner as a result of a request for
substitutions or alternatives shall be borne by the Trade
Contractor.
6.7 Preliminary Submissions
Whenever the Specifications do not specifically identify an item to be
installed, the Trade Contractor may submit to the Owner, before the
submission of required shop drawings, samples and product data, a list of
manufactured items that the Trade Contractor proposes to install, together
with the manufacturer's
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specifications, descriptive data and other information sufficient to
enable the Owner to determine if such items are suitable for installation
in the Project. The Owner, through the Construction Manager, shall advise
the Trade Contractor whether or not the items proposed are suitable for
installation. Such submission and notification shall be in addition to,
and not in lieu of, submission of shop drawings, samples of product data
for review as provided in this Article 6, and is intended solely for the
convenience of the Trade Contractor and to assist the Trade Contractor in
the selection of items for installation in the Project. The failure of the
Owner to reject an item on such list shall not prejudice the right of the
Owner, the Construction Manager or the Design Team to reject shop
drawings, samples or product data, if any, subsequently submitted or to
reject items on the basis of such shop drawings, samples or product data.
6.8 Testing
In connection with the review of any submission made pursuant to this
Article 6, the Owner may require the Trade Contractor to perform or
provide for tests or submit reliable test results to demonstrate fully
the suitability and sufficiency of any design or material proposed by the
Trade Contractor for incorporation in the Project or any method or means
of construction that the Trade Contractor proposes to use in connection
with the Work.
ARTICLE 7
CONSTRUCTION PRACTICES AT THE SITE
7.1 Contractor's Responsibility for Construction Methods
7.1.1 The Trade Contractor shall be solely responsible for the
means, methods, sequences or techniques of construction and
for the safe performance of the Work, provided that the Trade
Contractor shall not use any means, methods, sequences or
techniques of construction if such methods or means shall or
are likely to:
(a) endanger any person or property or the Work;
(b) unreasonably cause or contribute to a delay in the progress of
the Work or a conflict with the Work of others;
(c) result in a failure to perform the Work in accordance with the
Contract Documents or these General Conditions; or
(d) conflict with the requirements of applicable Laws.
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7.1.2 If the Contract Documents provide for the review of means and
methods of construction, the Trade Contractor shall submit
proposed means and methods of construction in the form of shop
drawings pursuant to Article 6 to the Construction Manager or
as otherwise directed by the Owner.
7.2 Security and Safety
7.2.1 Security
(a) The Trade Contractor shall be solely and fully responsible for
the protection and security of its Work and its own personnel,
materials, supplies, tools, vehicles and equipment, whether on
or off the Project site. The Owner and others may provide
guards, watchmen or other security at the Project site but
shall not be under any obligation to do so and by doing so
shall not assume any responsibility to the Trade Contractor,
its employees or any other person.
(b) The Trade Contractor shall coordinate its security program
with those of the Owner and other contractors.
7.2.2 Safety Requirements
The Trade Contractor shall be responsible for the safe
condition of its Work, the safety and protection of its work
force and any matters affected, either directly or indirectly
by the performance of the Trade Contractor's Work. The Trade
Contractor shall at all times comply with all applicable and
safety and loss prevention requirements of all insurance
carriers and all governmental authorities having jurisdiction,
including the Occupational Health and Safety Administration of
the United States Department of Labor and, if required by the
Contract Documents, comply with the Special Conditions
pertaining to the Work.
7.2.3 Safety Measures
The Trade Contractor shall take all measures necessary to
assure that its activities shall not at any time endanger the
safety of the general public or the premises surrounding the
Project site or any utilities, sewers or facilities or other
structures on or near the Project site, including without
limitation the Delaware Aqueduct
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which runs under the Project site at a depth not less than 200
feet from the surface.
7.2.4 Safety Devices
The Trade Contractor shall provide and maintain all necessary
barriers, barricades, fences, warning signs, fire prevention
and other usual or required measures and safeguards for the
protection of health, safety and property.
7.3 Report of Accidents
The Trade Contractor shall promptly report to the Owner in writing any
accident occurring on or off the Project site that relates to the Trade
Contractor's Work and in no event later than twenty-four hours after such
accident occurs and shall, in addition, immediately give notice by
telephone or messenger of any accident resulting in death or serious
personal injury or property damage. Such report shall include all known
details of the circumstances, the nature and extent of any injuries or
property damage, the names of all witnesses and other persons who may
have knowledge of the circumstances of the accident and such other
details as the Owner or its insurers shall require.
7.4 Trade Contractor's Responsibility in Emergencies
7.4.1 In the event of an emergency threatening life, health or
property, the Trade Contractor shall immediately take such
action as may be directed by the Construction Manager, or if
the Construction Manager is not present on the site, as may be
reasonable and necessary under the circumstances to save lives
and protect persons from injury and, this being done, to
protect and preserve property.
7.4.2 The Trade Contractor shall notify the Construction Manager and
the Owner of such emergency immediately, by telephone or
messenger, or if this is not possible, as promptly as is
practicable under the circumstances.
7.5 Signs
The Trade Contractor shall not display any sign, trademark or other
advertisement on or about the Project site without the consent of the
Owner.
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ARTICLE 8
INSPECTION, CORRECTION AND ACCEPTANCE OF THE WORK
8.1 Tests and Inspections
8.1.1 Required Tests and Inspections
All inspections, tests and approval of any means or methods of
construction or material or workmanship required by the
Specifications or by applicable Laws shall be performed by
independent consultants and at such times as the Owner shall
approve.
8.1.2 Optional Tests and Inspections
The Owner may require testing or inspection not required by
the Specifications or by applicable Laws to determine whether
any means or methods of construction or material or
workmanship are acceptable under the Contract Documents.
8.1.3 Conduct of Tests and Inspections
The Trade Contractor shall furnish samples of all materials
and component parts of the Work required as test specimens in
connection with any tests or inspections. The Trade Contractor
shall furnish labor and facilities as necessary in connection
with testing and inspection services. All samples, labor and
facilities shall be furnished by the Trade Contractor and all
inspections and testing shall be done in a timely manner so as
to avoid any delay in the progress of the Work.
8.1.4 Payment of Costs of Tests and Inspections
(a) The Trade Contractor shall pay the cost of all tests and
inspections referred to in Paragraph 8.1.1, including the cost
of related labor and facilities, except tests and controlled
inspections required by authorities with jurisdiction over the
Project or other applicable Laws.
(b) If any tests or inspections conducted pursuant to Paragraph
8.1.2: (i) are conducted in order to determine the
acceptability under the Contract Documents of Work that the
Owner has reason to suspect is not acceptable because similar
or related Work has been found to be defective or because
improper construction procedures have been followed, or (ii)
disclose that any methods or means of
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construction or material or workmanship are not acceptable
under the Contract Documents, the Trade Contractor shall pay
the costs of such tests and inspections, including the cost of
related labor and facilities.
8.1.5 Uncovering and Re-covering the Work
The Trade Contractor shall, when instructed to do so by the
Owner, uncover any portion of the Work that has been covered
to permit inspection or testing of such Work. If such Work had
been covered in violation of the requirements of Paragraph
7.5, the Trade Contractor shall bear the cost of uncovering
and re-covering the Work, whether or not the Trade Contractor
is required under Paragraph 8.1.4 to pay the costs of the
testing and inspection. If the covering of the Work was not in
violation of Paragraph 7.5, the costs of uncovering and
re-covering shall be paid by the person who is required by
Paragraph 8.1.4 to pay the costs of the testing and
inspection.
8.1.6 No Waiver by Owner
The acceptance of any Work after inspection or testing
pursuant to this Paragraph 8.1 shall not constitute acceptance
of any element or component of the Project of which such Work
is a part, nor shall any acceptance of Work pursuant to this
Paragraph 8.1 relieve the Trade Contractor of its
responsibility to complete the Work and warrant and guarantee
the completed Work in accordance with the Contract Documents.
8.2 Access to Work
The Owner, the Construction Manger, the Project Manager, the Design Team,
and all inspectors and representatives of testing laboratories conducting
tests or inspections pursuant to Paragraph 8.1, shall at all times have
access to the Work wherever it is being carried out. The Trade Contractor
shall provide or arrange for proper and safe facilities for such access
and for tests and inspections at the Project site, the place of
manufacture, the place of storage or any other place where testing or
inspection of the Work may be appropriate.
8.3 Repair and Replacement of Defective Work
8.3.1 The Trade Contractor shall, at its own cost and expense:
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(a) Before the Work is completed, either repair or replace, as the
Owner shall direct, any Work found to have been performed or
installed in violation of the Contract Documents; and
(b) Either repair or replace at its own expense, as the Owner
shall direct, any Work found to be defective or nonconforming
within the applicable warranty period provided in the
Specifications for the repair or replacement of defective
Work, or, if no period is specified, within a period of one
year from the delivery of the Certificate of Final Completion
pursuant to Paragraph 8.6.2.
8.3.2 The Trade Contractor shall repair at its own expense any
damage to its own Work or to the Work of any other contractor
caused by such repair or removal and replacement and shall
bear the cost of fees of the Construction Manager or members
of the Design Team which may have been made necessary as a
result of any defective Work.
8.3.3 If the Trade Contractor does not repair or replace the
defective or nonconforming Work within three days of written
notice, the Owner may remove it and may store the materials or
equipment at the expense of the Trade Contractor. If the Trade
Contractor does not pay the cost of such removal and storage
within ten days thereafter, the Owner may upon ten additional
days' written notice sell such materials or equipment at
auction or at private sale. The Owner shall account for the
net proceeds thereof, after deducting all the costs that
should have been borne by the Trade Contractor, including
compensation for additional services rendered by the Design
Consultant. If the proceeds of the sale do not cover all the
costs which the Trade Contractor should have borne, the
difference shall be charged to the Trade Contractor and an
appropriate Change Order shall be issued reflecting a decrease
in the Trade Contract Price. If the payments then or
thereafter due the Trade Contractor are not sufficient to
cover this amount, the Trade Contractor shall pay the
difference to the Owner.
8.3.4 Notwithstanding the provisions of this Paragraph 8.3, at the
Owner's option, it may accept defective or nonconforming Work,
in lieu of requiring its removal and correction. In such
event, a Change Order will be issued to reflect an appropriate
reduction in the Trade Contract Price, or, if the amount is
determined after final payment, it shall be paid by the Trade
Contractor to the Owner.
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8.4 Stop Work Orders
If the Trade Contractor fails to correct defective Work, persistently
fails to carry out the Work in accordance with the Contract Documents or
is otherwise in default thereunder, the Owner, by written order, may
direct the Trade Contractor to stop the Work, or any portion thereof,
until the cause for such order has been eliminated either by the Trade
Contractor or by the Owner pursuant to Section 12.3.
8.5 Further Construction Before Completion
The Owner may undertake further construction at the Project before the
Work has been completed. Such action shall not constitute acceptance of
the Work or a waiver of any claim against the Trade Contractor.
8.6 Acceptance of Work
8.6.1 Substantial Completion
(a) When, in the estimation of the Trade Contractor, the Work is
substantially complete, it shall so notify the Owner, setting
forth the proposed date of substantial completion. The Owner
may require review of the Work by the Construction Manager or
appropriate members of the Design Team pursuant to Article 4
of these General Conditions.
(b) Should the Owner find that, to the best of its knowledge and
belief, the Work is substantially complete, the Owner shall
deliver to the Trade Contractor a Certificate of Substantial
Completion and a punchlist of Work remaining to be completed,
specifying the date of substantial completion if different
from that proposed by the Trade Contractor.
8.6.2 Final Completion
(a) When, in the estimation of the Trade Contractor, the Work is
fully complete, including all punchlist work, it shall so
notify the Owner, setting forth the proposed date of final
completion. The Owner may require additional review of the
Work by the Construction Manager or appropriate members of the
Design Team until the punchlist work is completed to the
Owner's satisfaction.
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(b) Should the Owner find that, to the best of their knowledge and
belief, the Work is fully complete, the Owner shall deliver to
the Trade Contractor a Certificate of Final Completion,
specifying the date of final completion if different from that
proposed by the Trade Contractor, which shall constitute final
acceptance of the Work by the Owner.
(c) The delivery of a Certificate of Final Completion shall not
terminate or alter that Trade Contractor's guarantees and
obligation under the Contract Documents to complete the Work
and to fulfill all terms and conditions thereof.
8.6.3 Owner's Occupancy Prior to Final Completion
(a) After acceptance of the Work or portions thereof, the Owner
shall have the privilege of occupying and using such area or
areas in advance of completion of the entire Work, provided
such occupancy and use of such areas shall not unduly
interfere with the construction operations nor unduly delay
completion of the entire Work. In the event that the Owner
desires to exercise the privilege of partial occupancy prior
to completion of the entire Work as provided above, the Trade
Contractor shall cooperate with the Owner in making available
for the Owner's use required building services for the area or
areas to be occupied; and if the equipment required to furnish
such services is not entirely completed at the time the Owner
desires to occupy the aforesaid area or areas, the Trade
Contractor shall make every reasonable effort to complete the
same as soon as possible to the extent that the necessary
equipment can be put into operation and use.
(b) The Owner shall assume proportionate and reasonable
responsibility for operation of the equipment and utilities
required to provide the above services, in part or in total,
including proportionate and reasonable expenses of operation
incidental thereto. The Owner's occupancy or use of such areas
at the Project shall not constitute the Owner's acceptance of
any work, materials or equipment which are not in accordance
with the requirements of the Contract Documents, nor for
responsibility for loss or damage due to or arising out of
defects in, or malfunctioning of any work, material or
equipment, nor from any other unfulfilled obligations or
responsibilities under the Contract Documents.
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ARTICLE 9
CHANGES IN WORK
9.1 Unauthorized Changes Prohibited
The Trade Contractor shall perform the Work in strict accordance with the
Contract Documents, provided that, at the Owner's option, the scope of the
Work as defined in the Contract Documents or the Trade Contractor's time
of performance may be changed by written instruction issued by the Owner
as provided in this Article 9.
9.2 Change Orders
9.2.1 The Owner may, from time to time, change the scope of the Trade
Contractor's Work by written Change Order or Field Instruction to
the Trade Contractor specifying the change. Any adjustment to the
Trade Contract Price, if applicable, resulting from such change
shall be determined as provided in Paragraph 9.5.
9.2.2 The issuance of a Change Order does not entitle the Trade
Contractor to an extension of time, unless expressly provided by
the Owner. The issuance of a Field Instruction in itself does not
constitute a scope change.
9.2.3 The Owner may, from time to time, change the Contractor's time
for performance by Change Order. If a change in the time for
performance results from a cause that also entitles the Trade
Contractor to an adjustment in the Trade Contract Price, the
change in the Trade Contract Price shall be determined as
provided in Paragraph 9.5.
9.2.4 The Owner may, from time to time, request the Trade Contractor to
furnish the Owner with an estimate of the change in the Trade
Contract Price and the change in the Trade Contractor's time for
performance that would result from a contemplated change in the
scope of the Work. Within five days after receipt of such a
request, the Trade Contractor shall deliver to the Owner a
statement of the amount of the change in its Trade Contract Price
and change in its time for performance, if any, that would result
from the change, if effected. In no event shall such a request
constitute an authorization to the Trade Contractor to proceed
with the work described therein.
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9.3 Overtime
The Trade Contractor shall not be entitled to additional compensation for
Work performed outside normal working hours unless agreed to in writing in
advance by the Owner. Additional compensation for overtime shall be in the
amount of the overtime premium only, with no markup or other allowance.
9.4 Compliance with Owner's Instructions and Notice
9.4.1 Upon the receipt of written instructions from the Owner pursuant
to Paragraph 9.2, the Trade Contractor shall proceed to perform
the Work in accordance with such instructions and otherwise in
accordance with the Contract Documents, even if the amount of
additional payment or credit or the extent of any change in Trade
Contractor's time for performance, if any resulting from such
Work has not yet been determined and even if the Owner and the
Trade Contractor disagree as to whether the Trade Contractor is
entitled to additional payment or an extension of time for
performing such Work.
9.4.2 THE TRADE CONTRACTOR SHALL HAVE NO CLAIM FOR ADDITIONAL
COMPENSATION OR FOR AN EXTENSION OF TIME FOR PERFORMING WORK
ORDERED PURSUANT TO THIS ARTICLE 9 UNLESS THE TRADE CONTRACTOR
NOTIFIES THE OWNER IN WRITING OF THE TRADE CONTRACTOR'S CLAIM
BEFORE BEGINNING TO PERFORM SUCH WORK.
9.5 Payment or Credit for Scope Changes
9.5.1 The Trade Contractor shall be compensated for a change in the
scope of the Work in accordance with the following procedures,
which are listed in their order of priority:
(a) By any applicable lump sum, unit price, time and material or cost
plus basis already specified in the Trade Contract; or
(b) If the Trade Contract contains no applicable formula, by means of
a lump sum, unit price, time and material or cost plus basis
negotiated by the Owner and the Trade Contractor at the time the
change is ordered by the Owner; or
(c) In the event the Trade Contractor and the Owner cannot reach
agreement under Subparagraph (b), the Trade Contractor's
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compensation shall be limited to the actual cost of the labor and
material required to perform the Work done, or the estimated cost
of the labor and materials that would have been required to
perform the Work omitted, plus an allowance of 12% to cover all
overhead costs and profit of the Trade Contractor. If one or more
Subcontractors are performing the Work, the Trade Contractor's
total allowance for overhead and profit (including the cost of
the Subcontractor's work) shall be 15%. For purposes of this
Article 9: (i) the "cost of material" shall be the actual net
payments to suppliers after taking into account any discounts
allowed or allowable with respect thereto for material or
equipment installed or used in connection with the Work; and (ii)
the "cost of labor" shall be actual payments to the Trade
Contractor's or Subcontractor's employees, other than home office
employees and field executives, performing such additional Work,
including normal fringe benefits. The Trade Contractor
acknowledges that these allowances fully compensate the Trade
Contractor and its Subcontractors for all costs associated with
the General Conditions.
9.5.2 When a change results in a deletion of the Work from the Trade
Contract, a credit shall be issued by the Trade Contractor to the
Owner in an amount equal to the actual cost of the labor and
material deleted as defined in Paragraph 9.5.1(c) above, plus 4%
of such cost of the credited labor and material.
9.6 Changed and Unknown Conditions
9.6.1 The Trade Contractor shall promptly notify the Owner in writing
of: (1) work or other conditions differing materially from those
indicated in the Contract Documents, (2) unknown physical
conditions of an unusual nature, differing materially from those
indicated and generally recognized as inhering in work of the
character provided for in the Trade Contract, or (3) unavoidable
Excusable Delays. The Contractor shall notify the Owner of such
circumstances no later than two days after it becomes aware of
them. Together with such notice, the Trade Contractor shall
furnish an estimate of any additional cost and/or time required
to complete its Work as a direct result of such changed or
unknown conditions. If requested by the Owner, the Trade
Contractor shall submit an acceleration plan to recover any delay
in completion of the Work. The Owner shall promptly investigate
the conditions, and if it finds that such conditions do
materially so differ and cause an increase or decrease in the
Contractor's cost of, or the time required for, performance of
any part of the Work under the
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Trade Contract, the Trade Contractor shall be paid in the manner
provided for payment with respect to any Change Order and
receive, if warranted, a time extension.
9.6.2 NO CLAIM OF THE TRADE CONTRACTOR UNDER THIS CLAUSE SHALL BE
ALLOWED UNLESS TRADE CONTRACTOR HAS GIVEN THE NOTICE REQUIRED IN
PARAGRAPH 9.6.1 ABOVE.
9.7 Time and Material, Cost-Plus and Unit Price Work
9.7.1 When Work is performed on a time and material, cost-plus or unit
price basis, the Trade Contractor shall (i) before performing
such Work, submit a detailed projection of the anticipated cost
of such Work, and (ii) submit weekly reports to the Owner
detailing the costs and charges incurred in performing such Work.
9.7.2 Any request for a change order or purchase order for work
performed on a time and material, cost-plus or unit price basis
shall include a certified statement by the Trade Contractor
specifying in sufficient detail the costs incurred or units of
Work done, together with such supporting documentation as the
Owner shall reasonably require to determine the amount actually
due for such Work.
ARTICLE 10
PAYMENT
10.1 Payment for Materials
10.1.1 The Owner shall not make payment for materials purchased by the
Trade Contractor for installation in the Project until such
materials have been installed.
10.1.2 Notwithstanding Paragraph 10.1.1, the Owner, at the Owner's sole
option, may make payment for materials before installation, if
the Trade Contract so provides or otherwise at the Owner's sole
option, but then only if such materials have been delivered to
and safely protected at the Project site or some other secure
place acceptable to the Owner, and title to such materials has
been transferred to the Owner, or the Owner has been given a
perfected senior security interest in such materials, all
documented to the Owner's satisfaction before payment. If such
materials are held
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off-site, the Owner shall insure them, as provided in Appendix C,
against loss or damage and shall pay or make satisfactory
arrangement for the payment of all costs of insurance and
delivery to the site. [Confirm wrap-up covers off site materials]
10.2 Progress Payments
10.2.1 Payment and Retainage
The Owner shall make progress payments to the Trade Contractor
for Work performed in accordance with the Contract Documents.
Such progress payments shall be based on the actual progress of
the Work, as approved by the Owner, and on the Trade Contract
Price as adjusted by Change Orders, if any issued in accordance
with Paragraph 9.2.1. The Owner shall retain 10% of the amount
of each progress payment. The Owner, in its discretion, may not
require additional retainage after 50% of the Trade Contractor's
work is completed. Any amount retained by the Owner under this
Paragraph 10.2.1 on account of any Trade Contractor shall be paid
when final payment on account of such Trade Contractor is made
pursuant to Section 10.3. Progress payments shall be made within
thirty days after the submission by the Trade Contractor of a
request therefor complying with the requirements of Paragraph
10.2.2. Payment for Work pursuant to this Paragraph 10.2.1 shall
not constitute acceptance of such Work or relieve the Trade
Contractor of its responsibility to complete and guarantee the
Work in accordance with the Contract Documents.
10.2.2 Application for Payment
The Trade Contractor shall submit monthly applications for
progress payments, based on Work in place, not later than the
fifth day of each calendar month. Each application shall include
material invoices, evidence of equipment purchases, rentals and
other details of cost as the Owner shall require and in form and
content as required by the Owner. With each application, the
Trade Contractor shall submit the written consent of any surety
or guarantor, if required, and written releases and waivers of
the right to file a mechanic's lien from the Trade Contractor and
all Subcontractors with respect to all Work for which payment has
been made. Each application shall also include or be deemed to
include a certification by the Trade Contractor that:
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(1) All work for which the application is being submitted has
been performed in accordance with the Contract Documents.
(2) The materials for which such application is being submitted
have been (i) installed or incorporated in the Project or
(ii) if authorized pursuant to paragraph 10.1.2, delivered
to the site or held at approved off-site locations and
insured in accordance with Appendix A.
(3) No mechanic's, laborer's, vendor's, materialman's or other
liens are in effect with respect to the Project or any of
the materials incorporated therein or purchased in
connection therewith.
(4) The names and addresses of all Subcontractors, the
Subcontract amount of each Subcontract, and the amounts paid
and owed to each Subcontractor.
(5) The Trade Contract Price, including all adjustments, the
amount paid by the Owner to the Trade Contractor and the
amount retained by the Owner to the date of application, the
amount of the current application and the balance due on the
Trade Contract Price after such payment is made.
(6) Satisfactory evidence that all Subcontractors and laborers
have been paid all amounts advanced for their accounts in
previous progress payments.
(7) The application includes all claims of the Trade Contractor,
accrued or existing as of the date of the application,
against the Owner and the Project relating to the Contract
Documents and the Work.
(8) Such other information as the Owner may reasonably request
to determine if the amount requested is payable.
10.3 Final Payment
10.3.1 Time of Application
The Trade Contractor shall submit its applications for final
payment within thirty days after the Owner, pursuant to Paragraph
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8.6.2, has determined that the Work has been fully completed in
accordance with the Contract Documents.
10.3.2 Contents of Application
Applications for final payment shall contain the information required in
applications for progress payments specified in paragraph 10.1 and shall
include or be deemed to include, in addition, the following:
(1) A certification by the Trade Contractor that all Work has been
completed in accordance with the Contract Documents.
(2) A certification by the Trade Contractor that all warranties,
guaranties, certificates, operating manuals and other documents
required by the Contract Documents, have been delivered to the
Owner.
(3) A certification by the Trade Contractor confirming the warranty and
guaranty set forth in Paragraph 3.10.
(4) A certification by the Trade Contractor that the application for
final payment includes all claims of the Trade Contractor against
the Owner and the Project relating to the Contract Documents and
the Work.
(5) The As-Built Drawings maintained by the Trade Contractor pursuant
to Paragraph 3.8, certified by the Trade Contractor to be complete
and accurate.
(6) Written releases and waivers of the right to file a mechanic's lien
from the Trade Contractor and all Subcontractors with respect to
the Work.
(7) Any additional evidence the Owner may require that all
Subcontractors and laborers have been paid.
(8) A certification by the Trade Contractor that any required
inspections or approvals by any governmental authority having
jurisdiction have been performed or obtained, all certificates and
permits required to have been issued as a condition precedent to
the lawful use of the Project have
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been issued and the originals thereof have been furnished
by the Owner.
(9) A general release from the Trade Contractor to the Owner,
the Project Manager, the Construction Manager and the
members of the Design Team of all liability for all things
done or furnished in connection with the Work and for
every act or omission or neglect of the Owner, Project
Manager, the Construction Manager and the members of the
Design Team relating to or arising out of the Work or the
Project.
(10) The Certificate of Final Completion, pursuant to
Paragraph 8.6.2.
10.3.3 The Time of Final Payment
Provided the Trade Contractor is not otherwise in default of its
obligations under the Contract Documents, the Owner shall pay
to the Trade Contractor within thirty days after the submission
by the Trade Contractor of its application for payment complying
with the requirements of Paragraph 10.3.2 the balance of the
Trade Contract Price due for the Work, together with any amount
retained by the Owner.
10.3.4 Release
Acceptance by the trade contractor of the Final Payment shall
constitute a release of the Owner, the Project Manager, the
Construction Manager and the members of the Design Team from all
liability for all things done or furnished in connection with
the Work, and for every act of omission or neglect by the Owner,
the Project Manager, the Construction Manager and members of the
Design Team relating to or arising out of the work.
10.4 Owner's Right to Withhold Payments
10.4.1 The Owner may withhold from any payment to the Trade Contractor
the amount of any back charges and such amounts as the Owner
reasonably determines may be necessary to secure performance of
the Work in accordance with the Contract Documents, to assure
payment of just claims or liens or otherwise to protect itself
from any default by the Trade Contractor under the Trade
Contract, if any report of members of the Design Team, the
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Project Manager or the Construction Manager states or the Owner
reasonably determines that:
(a) The Work is defective and the defects have not been
corrected;
(b) The Trade Contractor has not promptly paid all amounts
due to Subcontractors and laborers;
(c) The Trade Contractor or any Subcontractor or laborer has
filed a mechanic's lien against the Project, and the
Trade Contractor has not seen to the discharge of such
lien in accordance with Paragraph 3.13;
(d) The Owner requests that the Trade Contractor give
satisfactory evidence that it has the financial ability
to carry out its obligations under the Trade Contract,
and the Trade Contractor fails to furnish such evidence
promptly;
(e) The Trade Contractor has caused damage to the Project or
the work of any other contractor or has delayed the
progress of the Work;
(f) Claims have been filed against the Trade Contractor or
reasonable evidence indicating the probable filing or
making of claims;
(g) Reasonable doubt that the Work can be completed for the
unpaid balance of the Trade Contract price;
(h) Unsatisfactory prosecution of the Work by the Trade
Contractor;
(i) Unauthorized deviations from the Contract Documents;
(j) The Trade Contractor is otherwise in default under the
Contract Documents;
(k) The Trade Contractor has not maintained insurance
coverages as required by the Owner;
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(l) The Trade Contractor has failed to update its Project
schedule as required by the Owner; or
(m) The Trade Contractor has not updated its As-Built
Drawings as required by the Owner.
10.5 Trade Contractor's Books and Records
The Trade Contractor shall keep complete and accurate records of (a) all
costs incurred in performing its Work under the Contract Documents; (b)
all purchases of materials made while the Trade Contract is in effect and
(c) all estimates, full supporting documentation and all other documents
and records prepared or used in connection with the Work, and shall make
its books and records available to the Owner for audit and copying. No
amount to be determined under the Contract Documents shall be payable by
the Owner unless such records are kept and until such records have been
made available for audit and copying if requested by the Owner. The Trade
Contractor shall keep such books and records available for audit and
copying for six years following final payment to the Trade Contractor.
10.6 Defective Work
No payment made to the Trade Contractor nor any partial or entire use or
occupancy of the Project by the Owner shall be an acceptance of any work
or material not in accordance with the Contract Documents or be deemed
evidence of proper performance of the Work, either wholly or in part, or
be construed as an acceptance of defective workmanship or improper
materials.
10.7 Trust Funds
All payments made to the Trade Contractor hereunder are hereby declared
to be Trust Funds in the hands of the Trade Contractor, to be applied
first to the payment of claims of Subcontractors, Architects, Engineers,
Surveyors, Laborers, Materialmen, labor unions and union dues, the
payment for utilities furnished and taxes imposed, and the payment of
premiums on surety bonds and premiums on insurance obtained during
performance of the Work before application to any other purpose.
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** Confidential treatment requested pursuant to Rule 406
ARTICLE 11
INSURANCE AND INDEMNITY
11.1 Insurance
The Trade Contractor and its Subcontractors shall fully comply with the
insurance requirements pursuant to the Owner's wrap-up insurance program
for the Project set forth in Exhibit B and any additional insurance
requirements which may be required by the insurance carrier furnishing
such wrap-up coverage for the Project and by the Trade Contract. The
Trade Contractor and its subcontractors shall maintain automobile
liability coverage, covering owned and hired vehicles, including bodily
injury and property damage coverage in an amount not less than
** per occurrence and in the aggregate.
11.2 Indemnity
11.2.1 To the fullest extent permitted by law, the Trade Contractor
shall defend, indemnify and hold harmless Swiss Re Investors,
Inc., Swiss Re America Holding Corporation, Swiss Reinsurance
America Corporation, Swiss Re America Life Insurance Company,
the Project Manager, the Construction Manager, the members of
the Design Team and each officer, director, shareholder,
partner, agent and employee thereof, against all claims, losses
and damages, including reasonable attorneys' fees and
disbursements, arising out of, in connection with, or as a
consequence of the performance of the Work, and/or any negligent
or wrongful act, error or omission or breach of contract or
infringement of any patent right by the Trade Contractor or any
Subcontractor or any officer, director, shareholder, partner,
agent or employee thereof in connection with the Contract
Documents.
11.2.2 Maintenance of the insurance required by the Trade Contractor or
wrap-up coverage by the Owner shall not, in any manner, limit
the Trade Contractor's obligations hereunder. In any and all
claims against any indemnities by any employee of the Trade
Contractor, or anyone directly or indirectly employed by the
Trade Contractor or by anyone for whose acts it may be liable,
the indemnification obligation of the Trade Contractor shall not
be limited in any way by any limitation on the amount or type of
damages, compensation or benefits payable by or for the Trade
Contractor under workers' compensation acts, disability benefits
acts or other employee benefit acts.
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11.2.3 Assistance
Should any claim arising out of the Contract Documents be made
against the Owner, the Project Manager, the Construction
Manager, or any member of the Design Team, or any member,
partner, director, officer, agent or employee thereof, the Trade
Contractor and its Subcontractors shall diligently render to the
person against whom such claim is made any and all assistance
that may be requested by such person.
ARTICLE 12
DEFAULT, TERMINATION, CLAIMS AND DISPUTES
12.1 Grounds for Termination
12.1.1 (a) If the Trade Contractor shall fail satisfactorily to
commence and continue to perform its obligations under the
Contract Documents, the Owner may without prejudice to any
other remedy the Owner may have, give the Trade Contractor
written notice that it must cure such default within
forty-eight hours; and, if such default is not so cured, the
Owner may terminate the Trade Contract.
(b) If the Trade Contractor, after receiving notices given
under Subparagraph 12.1.1(a), states before the expiration
of the notice period that it refuses to perform the
obligations listed in the notice, the Owner may immediately
terminate the Trade Contract.
(c) The Owner may terminate the Trade Contract without giving
the Trade Contractor the notice specified in Paragraph
12.1.1(a) if the Trade Contractor refuses or willfully or
repeatedly fails to carry out its obligations.
12.1.2 If the Trade Contractor shall fail to pay its debts in a timely
manner or if the Trade Contractor becomes insolvent, or if the
Owner shall have reason to believe that the Trade Contractor
does not have the financial ability to carry out its obligations
under the Contract Documents, and the Trade Contractor shall
fail to give to the Owner prompt and reasonable assurance of its
ability to perform, the Owner may terminate the Trade Contract.
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12.1.3 If there shall be filed by or against the Trade Contractor in any
court pursuant to any statute of the United States or of any
State, a petition in bankruptcy or insolvency or for
reorganization or for the appointment of a receiver or trustee of
all or a portion of the Contractor's property, or if the Trade
Contractor shall make an assignment for the benefit of creditors
or petition for or enter into a creditors' arrangement, the Owner
may, to the fullest extent permitted by law, terminate the Trade
Contract in accordance with this Paragraph 12.1.3. Upon the
occurrence of any such event, the Owner shall be entitled to
request of Trade Contractor or its trustee or other successor
adequate assurances of future performance. Failure to comply with
such request within ten (10) days of delivery of the request
shall entitle the Owner, in addition to any other rights and
remedies provided by this Agreement or by law, to terminate this
Agreement. Pending receipt of adequate assurances of performance
and general performance in accordance herewith, the Owner shall
be entitled to perform and furnish through itself or through
others any such labor, materials or equipment for the Work as may
be necessary to maintain the progress of the Work and to deduct
the cost thereof from any monies due or to become due to the
Trade Contractor under this Agreement. In the event of such
bankruptcy proceedings, this Agreement shall terminate if the
Subcontractor rejects this Agreement or if there has been a
default and the Trade Contractor is unable to give adequate
assurance that it will perform as provided in this Agreement or
otherwise is unable to comply with the requirements for assuming
this Agreement under the applicable provisions of the Bankruptcy
Code.
12.1.4 In the event the Project is abandoned, as determined by the
Owner, it may terminate the Trade Contract.
12.1.5 The Owner shall have the right, at any time, by written notice to
the Trade Contractor, to terminate the Trade Contract without
cause and require the Trade Contractor to cease work hereunder.
In the event of such a termination for convenience, the Trade
Contractor shall be entitled to payment pursuant to the terms of
the Trade Contract for all Work performed as of the date of
termination, together with reasonable costs of demobilization and
such other reasonable costs as may be encountered by the Trade
Contractor and directly attributable to such termination.
However, the Trade Contractor shall only be entitled to profit on
that portion of the work actually performed and approved for
payment to the date of termination, together with Retainages held
upon payments
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made prior thereto. The Trade Contractor waives any other claim
for payment from the Owner, including without limitation, claims
for loss of anticipated profits in the event the Owner exercises
this clause.
12.2 Effect of Termination
12.2.1 If the Trade Contract is terminated for any reason, the Owner may
take possession of the Work and may provide for the continuation
and completion of the Work in such manner as the Owner sees fit.
The Owner may use any or all materials, equipments, facilities or
tools acquired or used by the Trade Contractor in connection with
the Work, subject to payment therefor pursuant to Paragraph
12.2.2.
12.2.2 If the Trade Contract is terminated for any reason, the Owner
shall pay to the Trade Contractor the amount payable to the Trade
Contractor for that portion of the Work performed by the Trade
Contractor in accordance with and subject to the Contract
Documents prior to termination, and for the use of any materials,
equipment, facilities or tools of the Trade Contractor used by
the Owner in connection with the continuation or completion of
the Work. Such payment shall be made in accordance with Article
10. The Owner may set off against any payment due hereunder the
amount of damages incurred or anticipated by the Owner by reason
of any default by the Trade Contractor.
12.2.3 Upon the termination of the Trade Contract for any reason, all
bids or proposals and all Subcontracts entered into by the Trade
Contractor with respect to the Project shall, at the Owner's
option, be assigned to and assumed by the Owner or a person
designated by the Owner without the need for any action by the
Trade Contractor, or any Subcontractor or person submitting a bid
or proposal, and all such persons shall continue to be bound by
their bids, proposals and Subcontracts.
12.2.4 Neither the termination of the Trade Contract nor any payment
made upon such termination shall constitute acceptance of the
Trade Contractor's Work nor relieve the Trade Contractor of its
obligations under the Contract Documents.
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12.3 Owner's Right to Perform Trade Contractor's Obligations Without Termination
12.3.1 If the Trade Contractor fails satisfactorily to commence and
continue to perform any of its obligations under the Contract
Documents, the Owner, after forty-eight hours' written notice to
the Trade Contractor and without prejudice to any other remedy
the Owner may have, may carry out all or any of the obligations
of the Trade Contractor, either directly or through others, and
charge the cost thereof to the Trade Contractor.
12.3.2 If the Trade Contractor, after receiving notice give under
Paragraph 12.3.1, states before the expiration of the notice
period that it refuses to perform the obligations listed in the
notice, the Owner may immediately proceed to act as provided in
Paragraph 12.3.1.
12.3.3 The Owner may act as provided in Paragraph 12.3.1 without giving
the Trade Contractor the notice specified therein if the Trade
Contractor refuses or willfully or repeatedly fails to carry out
its obligations.
12.3.4 If the Owner performs a portion of the Trade Contractor's Work
pursuant to this Section 12.3, the Trade Contractor shall
continue to perform the balance of its Work, and shall cooperate
fully and in good faith, and coordinate its Work with the Owner
and any others performing such portion of the Work, and shall
make available to the Owner or such other person, all equipment,
machinery and other facilities on hand and in use for the
performance of its Work, to enable the whole of the Work to
proceed in accordance with the Contract Documents.
12.4 Notice and Waiver of Contractor's Claims
12.4.1 Notice of Claims
The Trade Contractor shall give notice to the Owner of any claim
against the Owner or any other member of the Project Team,
including any claim for an increase in the Trade Contract Price,
and extension in the Trade Contractor's time to perform, damages
for breach of contract, or compensation for the value of
construction or services outside the scope of the Contract
Documents.
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12.4.2 Time of Notice - Waiver of Claims - Documentation
NOTICE OF CLAIM FOR ADDITIONAL COMPENSATION FOR WORK ORDERED
PURSUANT TO ARTICLE 9 OR FOR CONSTRUCTION OR SERVICES CLAIMED TO
BE OUTSIDE THE SCOPE OF THE CONTRACT DOCUMENTS SHALL BE GIVEN
BEFORE THE TRADE CONTRACTOR BEGINS PERFORMANCE OF THE
CONSTRUCTION OR SERVICES IN QUESTION. THE ONLY EXCEPTION SHALL BE
LIFE THREATENING EMERGENCIES. NOTICE OF CLAIM FOR AN EXTENSION OF
TIME OR ADDITIONAL COMPENSATION FOR DELAY SHALL BE GIVEN WITHIN
TWO DAYS AFTER THE SUBCONTRACTOR HAS KNOWLEDGE OF THE
CIRCUMSTANCES GIVING RISE TO THE CLAIM. FAILURE BY THE TRADE
CONTRACTOR TO GIVE NOTICE OF A CLAIM WITHIN THE TIME SPECIFIED
SHALL CONSTITUTE A WAIVER BY THE TRADE CONTRACTOR OF SUCH CLAIM.
AS PROMPTLY AS POSSIBLE AFTER A NOTICE OF CLAIM HAS BEEN GIVEN,
THE TRADE CONTRACTOR SHALL SUBMIT TO THE OWNER A DETAILED
STATEMENT OF CLAIM.
12.5 Delay Claims
12.5.1 If the Trade Contractor is obstructed, hindered or delayed in the
commencement, prosecution or completion of the Work, without
fault on its part, by the Owner, the Design Consultants any other
Trade Contractor employed by the Owner, or by changes in the
Work, or by reason of unknown conditions (including those
specified in Paragraph 9.6), adverse weather conditions, fire,
lightning, earthquake, enemy action, act of God, or similar
catastrophe, or by government restrictions in respect to
materials or labor, or by an economic industry-wide strike or
lockout beyond the Trade Contractor's reasonable control (all of
which shall be deemed "Excusable Delays") then the sole and
exclusive remedy of the Trade Contractor shall be to notify the
Owner of such Excusable Delays and to proceed in accordance with
the procedures specified in Paragraph 9.6.
12.5.2 In the event the Trade Contractor seeks to make claim for
additional compensation on account of delays not contemplated and
provided the notice required by Paragraph 12.4.2, and either (a)
the Owner acquiesces in the claim or (b) a court of competent
jurisdiction determines the Trade Contractor may recover
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additional compensation for delay, such compensation shall be
limited to an adjustment of the Trade Contract Price to cover the
actual additional costs resulting from such delay, to the extent
provided in Paragraph 9.5, without regard to any other claimed
damages, whether direct, indirect, consequential, incidental or
otherwise.
12.6 Limitation of Action
No action arising out of the Contract Documents shall be maintained by the
Trade Contractor against the Owner (except a third party action,
counterclaim or crossclaim) unless such action is commenced within twelve
months after the date on which the Trade Contractor's application for final
payment is due in accordance with Paragraph 10.3.1.
12.7 No Interruption for Dispute
In the event of a dispute between the Owner and the Trade Contractor or
between the Trade Contractor and any other person with respect to the Work,
the Project or the Contract Documents, the Trade Contractor shall continue
to perform its obligations under the Contract Documents without
interruption or delay, pending the resolution or settlement of such
dispute; and the Trade Contractor shall not directly or indirectly stop or
delay the performance of the Work, including the delivery of materials to
the site.
12.8 Litigation Assistance
The Trade Contractor will assist the Owner and the Owner's attorneys at no
charge, in connection with all legal proceedings arising out of the Work or
related thereto by, among other things, appearing at hearings, depositions
and trials.
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EXHIBIT A
THE DESIGN TEAM
<PAGE> 55
DESIGN TEAM
- --------------------------------------------------------------------------------
Design Architect: Schnabil, Ammsoft, Ruchat, Merz
Architekten BSA & Partners AG
Contact: Prof. Dolf Schnebli or Sacha Merz, Proj. Mgr.
Hardturnstressed 175, 8005 Zurich SWITZERLAND
TEL: 011 411 447 4343
FAX: 011 411 447 4340
Email: [email protected]
Contact: Mr. Steven Fong, Consulting Architect
32 Gibson Avenue
Toronto, Ontario M5R 1T5
TEL: 416-944-2223 FAX: 416-944-8147
Email: [email protected]
- --------------------------------------------------------------------------------
Construction Document Adamson Associates
Architect: Contact: Mr. J. Esgby, Partner
Ms. Ann Daniel, Project Manager
2 Gloucester St.
Toronto, Ontario M4Y 1L5
TEL: 416-567-1500 FAX: 416-887-7160
Email: [email protected]
- --------------------------------------------------------------------------------
Structural Engineer: Yolles Partnership Inc.
Contact: Mr. Andrew Bergmann, Partner
Mr. Paul Zucchi
153 Queen St. East, Suite 200
Toronto, Ontario
M5A 151
TEL: 416-353-8123 FAX: 416-363-0341
Email: [email protected]
- --------------------------------------------------------------------------------
M E P Consultants: Cosentini Associates:
Contact: Mr. Marvin Mass, Partner
Mr. Jonathan Michaeli, Partner
Mr. Scott Ceasar, Project Mgr. (Mechanical)
Mr. Jim McGanty (Plumbing & Fire Prot.)
Mr. Howard Rappaport (Electrician)
Two Pennsylvania Plaza
New York, NY 10121
TEL: 212-515-3600 FAX: 212-515-3700
Email: [email protected] (Drawings)
[email protected] (Corres.)
- --------------------------------------------------------------------------------
Civil Engineer and Olynay Tung Schwalbe
Liaison with D E P: Contact: Mr. J. Michael Divney
Mr. Jerry Schwalbe
Mr. Bill Carey
1 North Broadway
White Plains, NY 10601
TEL: 914-428-0010
FAX: 914-428-0017
- --------------------------------------------------------------------------------
Off-Site Traffic John Collins Engineer, P.C.
Engineer: Contact: Dr. John T. Collins
11 Bradhurst Avenue
Hawthorne, NY 10532
TEL: 914-347-7500 Fax 914-347-7268
Email: [email protected]
- --------------------------------------------------------------------------------
Surveyor: Badey & Watson
Contact: Mr. Glannen J. Watson
Route 9
Cold Spring, NY 10516
TEL: 914-285-9217 FAX: 914-285-4428
- --------------------------------------------------------------------------------
<PAGE> 56
- --------------------------------------------------------------------------------
Geotechnical Consultant: Lancen Associates
Contact: Mr. George Levands
Mr. John McElroy, Project Manager
River Drive Center One, 4th Floor
Elmwood Park, NJ 07407
TEL: 201-784-8900 FAX: 201-784-0338
Email: [email protected]
- --------------------------------------------------------------------------------
Hydrogeologist: Sergio Smiriglio Environmental Consultants (SSEC)
Contact: Mr. Sergio Smiriglio
27 Mine Hill Road
Cornwell,NY 12518
TEL: 914-534-3616
FAX: 914-534-4739
Email: [email protected]
- --------------------------------------------------------------------------------
Accoustic Consultant: Cerami & Associates
Contact: Mr. John Longman/Ms. Victoria Cerami
818 Fifth Avenue
New York, NY 10036-0385
TEL: 212-382-2529 FAX: 212-382-0853
- --------------------------------------------------------------------------------
Cost Consultant: Wolf & Co.
Contact: Mr. Vincent Vetrano
P.O. Box 805, Route 35 & 22
Coldwell Banker Bldg.
Katonah, NY 10636-0805
TEL: 914-232-2400 FAX: 914-232-4168
- --------------------------------------------------------------------------------
Interior Designer; IJu & Lewis
Contact: Ms. Carolyn Iu, Principal
57 East 11th Street
New York, NY 10003
TEL: 212-962-3633 FAX: 212-982-6008
Email: [email protected].
All Correspondence, Etc., To:
Perking & Will
Contact: Mr. Don Williams, Project Manager
1 Park Avenue, 18th Floor
New York, NY 10016
TEL: 212-251-7000 FAX: 212-251-7111
Email: [email protected]
- --------------------------------------------------------------------------------
Curtain Wall Consultant: Israel Berger & Associates
Contact: Mr. William Logan
232 Madison Avenue
New York, NY 10016
REL: 212-589-5389 FAX: 212-589-5449
- --------------------------------------------------------------------------------
Elevator Consultants H.H. Angus & Associates Limited
Contact: Donald G. Cooper, Project Engineer
Mr. Rick Marsiglio
1127 Leslie Street
Don Mills, Ontario
M3C 2J5
TEL: 416-443-8258 FAX: 416-443-8290
- --------------------------------------------------------------------------------
Environmental Consultants: Leggette, Brashars & Graham, Inc.
Contact: Mr. R.G. Slayback
125 Monroe Tumpike
Trumbull, CT 06811
TEL: 203-452-3100 FAX: 203-452-3111
- --------------------------------------------------------------------------------
<PAGE> 57
- --------------------------------------------------------------------------------
Technology Consultant Electronic Systems Associates
11 West 42nd Street, 3rd Floor
New York, NY 10036
Contact: Khaled Nassoura, Proj. Manager
TEL: 212-843-3600
FAX: 212-343-3699
Email: [email protected]
- --------------------------------------------------------------------------------
Security Consultant Electronic Systems Associates
11 West 42nd Street, 3rd Floor
New York, NY 10036
Contact: Albert Palumbo, Group Vice President
TEL: 212-843-3800
FAX: 212-843-3858
Email: [email protected]
- --------------------------------------------------------------------------------
Lighting Consultant Susan Brady Lighting Design
39 West 38th Street
New York, New York 10018
Contact: Susan Brady
Kim Loren, Project Manager
TEL: 212-391-4230
FAX: 212-391-4231
- --------------------------------------------------------------------------------
<PAGE> 58
EXHIBIT B
INSURANCE COVOERAGE
<PAGE> 59
** Confidential treatment requested pursuant to Rule 406
SWISS RE AMERICA WRAP UP PROJECT
INSURANCE PROVIDED BY SWISS RE UNDER THE WRAP UP
Swiss Re has secured specific insurance coverage for Project Manager,
Construction Manager, Contractor, and Subcontractors of all tiers performing
Work at the Jobsite. The insurance does not apply to vendors, suppliers,
material dealers, or others who merely transport, pick up, deliver or carry
materials to or from the jobsite.
ONLY THE FOLLOWING INSURANCE SET FORTH IN (a), (b) AND (c) BELOW IS PROVIDED BY
SWISS RE UNDER THE WRAP UP.
o Workers' Compensation Insurance
Workers' Compensation Insurance in statutory limits for the State of New
York. Employers Liability limits of ** Each Accident/ **
Disease Each Employee/ ** Disease Policy Limit are also provided.
INDEPENDENT TRUCKERS/HAULERS WILL NOT BE INSURED UNDER THE OWNERS PROGRAM.
o Commercial General Liability Insurance
Commercial General Liability insurance (EXCLUDING AUTOMOBILE, ASBESTOS AND
PROFESSIONAL LIABILITY) applying to all Insureds jointly and with the
following limits:
** Per Occurrence Each Insured
** Completed Operations Aggregate
** Personal & Advertising Injury
** General Aggregate All Insureds Annually
THIS INSURANCE WILL NOT EXTEND COVERAGE FOR PRODUCTS LIABILITY TO ANY
INSURED PARTY, VENDOR, SUPPLIER, MATERIAL DEALER OR OTHERS FOR ANY PRODUCT
MANUFACTURED, ASSEMBLED OR OTHERWISE WORKED UPON AWAY FROM THE JOBSITE.
o Umbrella Liability Insurance Limits will be provided to match your Umbrella
up to your present limits
Excess Liability Insurance (EXCLUDING AUTOMOBILE, ASBESTOS, AND
PROFESSIONAL LIABILITY), COVERING ALL INSUREDS JOINTLY.
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o Builder's Risk Insurance - Provided by SWISS RE:
Swiss Re will maintain an All Risk Policy throughout the life of the
project insuring all property incorporated in the Project.
WE RECOMMEND THAT THE CONTRACTOR AND SUBCONTRACTORS OF ALL TIERS HAVE THEIR
INSURANCE AGENT REVIEW THE COVERAGES PROVIDED BY SWISS RE. IT IS THE
RESPONSIBILITY OF THE CONSTRUCTION MANAGER, CONTRACTOR AND SUBCONTRACTORS OF
ALL TIERS TO MAINTAIN, AT THEIR SOLE OPTION AND COST, ANY ADDITIONAL INSURANCE
THEY DEEM NECESSARY AND/OR, IN LIEU OF EXCLUDING COVERAGE FOR THIS PROJECT FROM
THEIR ONGOING LIABILITY INSURANCE PROGRAM, THAT THEY HAVE THEIR COMMERCIAL
GENERAL LIABILITY POLICY AND THEIR UMBRELLA/EXCESS LIABILITY POLICY ENDORSED TO
THE EFFECT THAT INSURANCE PROVIDED UNDER THE WRAP UP.
THE COVERAGES REFERRED TO ABOVE ARE SET FORTH IN FULL IN THE RESPECTIVE POLICY
FORMS, AND THE FOREGOING DESCRIPTIONS ARE NOT INTENDED TO BE COMPLETE.
FOR FURTHER INFORMATION PLEASE CALL:
SILVANA VLACICH OR DEBRA DIGIARO
AT 1-800-962-5524 OR 212-797-9600
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** Confidential treatment requested pursuant to Rule 406
SWISS RE AMERICA WRAP UP PROJECT
INSURANCE TO BE PROVIDED BY CONTRACTORS/SUBCONTRACTORS
Project Manager, Construction Manager, Trade Contractor and all tiers of
Subcontractors shall at all times during the period in which the Contract is in
force and effect, provide and maintain the following insurance at their own
expense:
(a) Automobile Liability Insurance covering all owned, non-owned and hired
automobiles, trucks and trailers. In limits not less than **
Combined Single Limit each occurrence for Bodily Injury and Property
Damage.
(b) Commercial General Liability Insurance for Operations away from the
jobsite including products liability for any product manufactured,
assembled or otherwise worked upon away from the jobsite. The total
available limits combined shall not be less than ** general
aggregate limit and ** aggregate products and completed
operations.
(c) Workers' Compensation Insurance in statutory limits of the Workers'
Compensation Law of the State of New York, and ** Each
Accident/ ** Disease - Policy Limit/ ** Disease Each Employee
Employers Liability coverage for all Work away from the jobsite.
(d) CONTRACTORS AND SUBCONTRACTORS OF ANY TIER SHALL REQUIRE THEIR RESPECTIVE
VENDORS, SUPPLIERS, MATERIAL DEALERS AND OTHERS WHO MERELY TRANSPORT,
PICKUP, DELIVER OR CARRY MATERIALS, PERSONNEL, PARTS OR EQUIPMENT OR ANY
OTHER ITEMS OR PERSONS TO OR FROM THE JOBSITE TO MAINTAIN INSURANCE AS
SPECIFIED IN (a) THROUGH (c) OF THIS SECTION, ABOVE.
(f) The WRAP UP includes coverage for completed operations for three years
after the date of acceptance by Owner of the Work. It is the
responsibility of the Construction Manager, Contractor and Subcontractors
to arrange for the continuation of completed operations coverage with
their own insurance agent and insurer after termination of completed
operations coverage under the WRAP UP.
(g) Any Contractor or any Subcontractor utilizing mobile equipment not
scheduled in their auto policy should review this coverage with their
agent and/or insurer. The WRAP UP will not provide coverage for liability
claims or damage to the mobile equipment itself arising out of the
operation of mobile equipment that has been scheduled under the
Contractor's or Subcontractor's automobile policy.
(h) Contractor and all Subcontractors shall maintain insurance on their owned
or leased equipment, tools, trailers, etc. The Builders' Risk Policy
excludes coverage for this property.
Page 4
<PAGE> 62
(a) FORM 1
SWISS RE AMERICA CORP./CORPORATE HEADQUARTERS FACILITIES
ARMONK, NY
FORM 1
Page 1
1. Name: ____________________________________________________________________
2. Address: _________________________________________________________________
3. Telephone: Area Code (___) No.: ______________________________________
4. Federal Employer ID#: ____________________________________________________
5. Project Field Representative Insurance/Risk Manager
Name: __________________________________ ________________________________
Address: _______________________________ ________________________________
Telephone: _____________________________ ________________________________
6. Brief Description of Work Performed
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
7. Estimated Start Date of Jobsite Activities: ______________________________
8. Estimated Completion Date of Jobsite Activities: _________________________
WORKERS' COMPENSATION DATA
9. Classification 10. Code 11. Payroll 12. Man-hours
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
*Include only the estimated jobsite payrolls to be directly performed by your
company (and not by your Subcontractors) for the period coverage is provided.
30
<PAGE> 63
FORM 1
Page 2
13. WC Exp. Modification _____________ Anniversary Rating Date________________
Workers' Compensation Bureau Risk No._____________________________________
14. Location of payroll records: _____________________________________________
15. Estimated Contract Amount: _______________________________________________
16. Contract Number/Award Date: ______________________________________________
17. PRESENT INSURANCE COVERAGE
Workers' Compensation General Liability
Insurer: __________________________ _________________________
Policy No. __________________________ _________________________
Agent/Broker: __________________________ _________________________
Address: __________________________ _________________________
__________________________ _________________________
Account Executive: __________________________ _________________________
Telephone: __________________________ _________________________
18. ADDITIONAL MISCELLANEOUS DATA
18a. Is your firm a prime Contractor with the State of New York?
[ ] Yes [ ] No
18b. If your firm is a Subcontractor, the name of your prime Contractor is:
__________________________________________________________________________
31
<PAGE> 64
19. If your firm anticipates that some of the Work to be done under your
contract will be subcontracted to others, indicate the names and addresses
of the firms which will an as your Subcontractors (attach additional pages
if necessary):
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
20. Is your firm a Joint Venture subsidiary and/or a division of another
company?
[ ] Yes [ ] No
If you are a subsidiary and/or a division of another company you must
complete an ERM 14 Form.
If you are a participant as a Joint Venture partner you must complete an
ERM 14 Form.
CERTIFICATION
I certify that the statements in this Request for Insurance are true to the
best of my knowledge. Your firm's Workers' Compensation loss experience
incurred on this project is reported annually to the Bureau and is used to
promulgate your experience modification factor.
21. _______________________________ _______________________________
Officer Title
_______________________________
Date
32
<PAGE> 65
ADDITIONAL PROVISIONS/SCOPE OF WORK
Curtainwall
A. DOCUMENTS AND POLICIES:
This Trade Contractor agrees to perform all the work necessary to provide
CURTAINWALL for the Swiss Re America U.S. Headquarters Project located in
North Castle, NY in strict accordance with the following documents:
1. List of attached Contract Documents for Swiss Re America U.S.
Headquarters Project:
a. TURNER CONSTRUCTION COMPANY'S List of Contract Drawings and
Specifications for the CURTAINWALL for the Swiss Re America U.S.
Headquarters Project dated 03/10/97. (Attachment 'A')
NOTE #1: This Trade Contractor shall be responsible for all
information contained in the Contract Drawings and Specifications as
related to your work. If the Contract Drawings and Specifications
conflict, then the greater quantity and quality shall apply.
NOTE #2: It is agreed and understood that the Contract Documents are
not complete, however this Trade Contractor has included all costs to
provide a complete job consistent with the design intent.
b. TURNER CONSTRUCTION COMPANY'S Curtainwall Milestone Schedule for
the Swiss Re America U.S. Headquarters Project dated 04/23/97.
(Attachment 'B')
c. Special Provisions for all Trade Contractors and Vendors for the
Swiss Re America U.S. Headquarters Project dated 03/19/97.
(Attachment 'C')
d. Curtainwall Erection Sequence dated 03/19/97 and Swiss Re America
Logistics Plans for phases 3.5-8 for the Swiss Re America U.S.
Headquarters Project. (Attachment 'D')
e. Specifications for Temporary Light and Power for Construction
Purposes dated 03/19/97. (Attachment 'E') - This item is
furnished and installed by others.
2. List of referenced Turner Construction Company's forms and policies
that are hereby specifically made part of the Contract Documents:
a. Safety and Hazardous Communication Program for Swiss Re America
U.S. Headquarters Project dated 01/24/97.
b. AIA Document A312; Payment and Performance Bonds Forms.
c. The Turner Corporation's Policy on Drugs and Alcohol Abuse (for
Turner Employees) dated 01/16/96.
d. Swiss Re Investors, Inc. General Release (final payment).
e. Turner Construction Company's Corporate Affirmative Action
Program. (This trade contractor shall abide by Turner
Construction Company's Corporate Affirmative Action Program) rev
08/94.
**NOTE**: By signing this agreement, the trade contractor
acknowledges that he has read these referenced documents and will
unconditionally abide by its terms and conditions.
Page 1 of 10
<PAGE> 66
** Confidential treatment requested pursuant to Rule 406
ADDITIONAL PROVISIONS/SCOPE OF WORK
Curtainwall
3. SEXUAL HARASSMENT: Turner Construction Company has always stressed a
discrimination free working environment and has stated policy on sexual
harassment which prohibits any form of sexual harassment by employees and
non-employees on our job sites. All trade contractors, suppliers and/or
vendors are required to comply with this policy and any and all other
requirements of the New York Employment Practices Act.
4. All pricing submitted by Trade Contractors and Vendors, including pricing
of change orders, alternates, and unit pricing, shall include all things
necessary for a complete installation of the work. This includes, but is
not limited to, all labor, materials, tools, bond premiums, shop drawings,
allowances for waste, equipment, shipping costs, handling, storing,
hoisting, riggings, distribution, protection of materials, fringe benefits,
taxes, overhead, profit, insurance, etc.
5*. The allowable combined percentage mark-up for overhead and profit on direct
costs of changes when work is performed by the Trade Contractor shall be
**. This same percentage shall be allowed for any changes performed by
Sub-trade contractors and ** may be added by the trade contractor to the
Sub-trade contractor's estimate. The total on all tiers shall not exceed
** in the aggregate.
*SEE RIDER 'A' ITEM #1
In the case of change orders involving deletions for the work or other cost
savings, the deductions from the Contract Sum shall be at ** and
shall include an additional deduction of ** for general conditions and **
for profit. Markups shall be applied to the total net value of any change
or group of changes.
6. The following are hourly wage rates for performing extra work on a time and
material basis and shall be valid for the life of the project. These rates
are fully loaded (including benefits, taxes, insurance, overhead and
profit, bond costs, small tolls, travel, parking, and any other costs
associated with labor, etc.) and are in accordance with the union wage
agreement of the trade having jurisdiction in areas where the work is
performed. NOTE: Further, no mark-up shall be allowed on the premium time
portion of the wage rate.
FOREMEN Straight Time Time & One Half Double Time
------- ------------- --------------- -----------
Operator Not Applicable per Flour City Architectural Metals, Inc.
Ironworker ** ** **
Sheetmetal Not Applicable per Flour City Architectural Metals, Inc.
Glazier ** ** **
Engineer/Draftsperson ** ** n/a
JOURNEYMEN Straight Time Time & One Half Double Time
---------- ------------- --------------- -----------
Operator Not Applicable per Flour City Architectural Metals, Inc.
Ironworker ** ** **
Sheetmetal Not Applicable per Flour City Architectural Metals, Inc.
Glazier ** ** **
Engineer/Draftsperson ** ** n/a
Page 2 of 10
<PAGE> 67
ADDITIONAL PROVISIONS/SCOPE OF WORK
CURTAINWALL
B. TAXES, BONDS, INSURANCE, ETC.
1. PAYMENT AND PERFORMANCE BONDS ARE BEING FURNISHED as part of this
subcontract Agreement. Payment and performance bonds will be AIA
form A312-1984. (Surety must appear on the Current U.S. Treasury
Federal Register) Furthermore, the following shall apply:
Trade contractor and its Surety hereby agrees to execute and deliver
to Swiss Re Investors, Inc. in connection with the issuance of
change orders under this Agreement Rider "A" amendments (form
attached hereto) increasing the amount (penal sum) of the
performance and payment bonds to be furnished by Trade Contractor as
provided in this Agreement when Trade Contractor is requested by
Swiss Re Investors, Inc. to do so. The reasonable premium or other
charges paid by Trade Contractor for the procurement of the Rider
"A" amendments requested by Swiss Re Investors, Inc. will be paid as
a change to this Agreement.
2. NEW YORK STATE SALES AND USE TAXES ARE EXCLUDED in accordance with
the laws and statutes of the State of New York. A TAX EXEMPTION
CERTIFICATE/PERMIT NO. WILL BE HELD BY THE SWISS RE INVESTORS, INC.
WHICH ENABLES ALL LABOR AND MATERIAL TAXES TO BE EXEMPT. This
Certificate/Permit No. to follow under separate cover and made part
of this agreement.
3. This Trade Contractor shall provide and maintain all insurance's as
required and referenced in the Insurance Coverage Section, Exhibit
"B" of the General Conditions. ANY AND ALL INSURANCE'S REQUIRED TO
BE PROVIDED BY THIS TRADE CONTRACTOR VIA THE WRAP UP INSURANCE
POLICY (EXHIBIT 'B' OF THE GENERAL CONDITIONS) DOCUMENT MUST BE
PROVIDED BY THIS TRADE CONTRACTOR VIA AN ACCEPTABLE INSURANCE
CERTIFICATE PRIOR TO COMMENCEMENT OF THE WORK. IN ADDITION, ANY/ALL
INSURANCE'S LISTED IN THE ADDITIONAL PROVISION/SCOPE OF WORK (i.e.,
ERRORS AND OMISSIONS INSURANCE/PROFESSIONAL LIABILITY) NOT
SPECIFICALLY ADDRESSED IN THE WRAP UP INSURANCE POLICY MUST BE
PROVIDED VIA AN ACCEPTABLE INSURANCE CERTIFICATE PRIOR TO
COMMENCEMENT OF THE WORK.
C. SCOPE OF WORK
Without the intent of limiting the Scope of Work to be performed by the
Trade Contractor, included in the complete design, furnishing and
installation of the CURTAINWALL SYSTEM, in accordance with the Contract
Documents and as further clarified herein:
1. Includes performing all the Curtainwall Work in accordance with he
Contract Documents and the following Specification Sections as they
relate to the foregoing work:
<TABLE>
<S> <C>
08900 - Curtainwall Systems (ATTACHMENT 'F')....................... dated 03/07/97
Turner Construction Company Addendum #1 (ATTACHMENT 'G')........... dated 03/31/97
</TABLE>
DESIGN INTENT
2. Provide all necessary labor, material, scaffolding, equipment,
tools, hoisting, transportation, storage, and other facilities required
by and reasonably inferred from the contract documents to provide a
complete and watertight Curtainwall system.
Page 3 of 10
<PAGE> 68
ADDITIONAL PROVISIONS/SCOPE OF WORK
CURTAINWALL
3. It is understood and agreed that the work to be contracted is of a
DESIGN/BUILD nature, and that the Curtainwall trade contractor has been
selected on the basis of his proven ability to design and construct an
acceptable system consistent with the intent of the contract documents,
and the contractor's understanding of what is involved in construction of
this type. The drawings and specifications provided herewith represent
the minimum standards for the level of materials to be installed under
this contract. It is understood that this contract is for a complete
project in every respect, and includes all items of work inferable from
plans as determined by the Architect, work which is required by Federal,
State, or local code including seismic provisions, and work which complies
with good construction practice and the state of the art of the industry.
The trade contractor, having certain skills and judgments based upon his
knowledge of techniques, procedures, systems, and general state of his
trade is expected to include in the scope of work all items required in
order to carry out the Architect's and Construction Manager's intent for a
complete and functional system whether or not shown or described in the
contract documents. No extra payments shall be made or claims entertained
as a result of such items, which in the Owner's Representative's,
Construction Manger's and the Design Consultant's opinion are
clarifications and should have been included in this trade contractor's
scope of work.
4. All required design services shall be furnished by a qualified Registered
Professional Engineer currently certified in the State of New York, whose
stamp shall appear on the design documents. The Curtainwall contractor
shall give all notices and comply with all applicable laws, building
codes, ordinances, regulations and orders of any public authority bearing
on the design or construction of the work.
5. The Curtainwall contractor is responsible for a complete exterior wall
system in conformance with the details, profiles, and aesthetics
specified in the drawings, specifications and bid documents.
6. Furnish and install any additional supporting steel or gusset/beam
reinforcement or diagonal bracing system as required to reinforce the
Curtainwall systems to the structure and any intermediate framing
required to provide connection points for the Curtainwall system. Provide
detailing and a Professional Engineer's stamp (licensed in the state of
New York) for this additional support steel. This trade contractor shall
provide a detailed summary including drawings of all components of this
work. Also, provide a summary of all adjacent work which will be required
by others. THIS TRADE CONTRACTOR WILL NOT BE REQUIRED TO PROVIDE
ADDITIONAL SUPPORT STEEL TO ASSIST THE STRUCTURAL STEEL IN SUPPORTING THE
LOADS OF THE CURTAINWALL SYSTEM. HOWEVER, THIS TRADE CONTRACTOR WILL
FURNISH THE STRUCTURAL CONSULTANT AND THE CONSTRUCTION MANAGER WITH ALL
PERTINENT REACTIONS IMPOSED ON THE STRUCTURE BY THE CURTAINWALL SYSTEM BY
05/23/97 SO THAT THEY MAY BE INCORPORATED INTO THE STRUCTURAL DESIGN.
7. It is essential the Curtainwall contractor be aware of interfacing with
the work of other contractors, and as such is to incorporate provisions
in the design of the system to enable penetrations for, and/or adherence
to or from, those other contractors. This contractor assumes
responsibility for weathertightness and the water integrity at these
junctures.
8. The Curtainwall support system shall not interfere with the interior
construction. Drawings submitted with this bid proposal shall be reviewed
by the Architects for any potential conflicts.
Page 4 of 10
<PAGE> 69
ADDITIONAL PROVISIONS/SCOPE OF WORK
Curtainwall
9. This building is designed per industry standard structural tolerances.
The Curtainwall support system must have adequate adjustment to allow
for such tolerance. Building tolerances assumed in the Curtainwall
design as given by this trade contractor for adjacent work are as
follows:
Slab in/out +\- 1 1/2"
Slab up/down +\-1"
Curb in/out +=1"
Curb up/down +0",-1"
Steel in/out +0",-2"
Steel up/down +2",-0"
10. All slab edges and structural steel that abuts the work of this
contractor must be surveyed by this contractor prior to installation
of the Curtainwall work. Any discrepancies from allowed tolerances
must be reported to Swiss Re Investors, Inc., who will direct the
appropriate contractor to correct same. This subcontractor has
included as survey of the slab edge prior to commencing the erection
of the Curtainwall and shall promptly report any areas out of
acceptable tolerances as listed above.
11. Furnish and Install the complete support system required for the
Curtainwall, including erection hardware, embedded items (including
additional rebar required or support steel, if required), and burning
of holes in the slab edge forms for embedded items. Inserts used must
be compatible with the structural characteristics of the poured
concrete.
12. If the proposed mullion depth varies from the depth indicated on the
contract drawings, this contractor is responsible for the design of
connections that will support the mullions. The structural limits of
the edge of slab and spandrel beam centerline will not change.
Accommodations for interior work must also be accounted for. All such
deviations from the contract drawings are subject to the approval of
the Architect.
13. The final sealants where this contractor's work abuts the work of
others and within his own work will be completed by this contractor,
regardless of which work was installed first. Include all sealant
between metal to metal, metal to glass, glass to glass, and
metal/glass to dissimilar materials. Provide all trim and closure
pieces, shims, as may be required to properly anchor and install the
assemblies. All loose flashing for the Curtainwall system (including
at the roof soffit) will be furnished and installed by this trade
contractor.
14. This contractor shall submit their design documents to Swiss Re
Investors, Inc. for review and approval by the Architect, and in
accordance with a schedule agreed upon with Swiss Re Investors, Inc.
The Architect's review shall be only for general conformance of this
contractor's design with the established design and performance
criteria, and with the Architect's design intent. Such review and
approval shall not relieve this contractor of his obligation to design
and construct the Work in order to meet the design and performance
criteria in every respect.
15. During the Curtainwall engineering submittal stage, this trade
contractor is responsible for indicating the quantity and locations of
all embedded items and additional support steel. This information is
required prior to the procurement of the concrete and structural
trades. Failure of this trade contractor to provide this information
in a timely manner acceptable to Swiss Re Investors, Inc. and Turner
will result in all costs incurred to furnish and install said items to
be borne by this trade contractor. All steel and concrete shop
drawings will be sent to this trade contractor for verification of
exterior wall connection details, locations and imposed loads.
Page 5 of 10
<PAGE> 70
ADDITIONAL PROVISIONS/SCOPE OF WORK
-----------------------------------
CURTAINWALL
16. This trade contractor will submit for approval embed and connection layout
drawings indicating all connection details to, and loads imposed on, the
building structure. The installation of these items by this subcontractor
must be in a timely manner such that the other structural trades are not
delayed. All embedded items must be hot dipped galvanized.
17. This contractor shall work closely with Architect, through Turner, at
points of juncture with other materials or contractors to develop
compatible details within the conceptual and engineering parameters of
the project.
18. This contractor is responsible for the layout of his work. Swiss Re
Investors, Inc. will supply a perimeter control line and a benchmark on
each floor.
19. This contractor is responsible for all testing required by the contract
documents. This shall include full cooperation with the Owner's testing
agency for any testing to be done on site. The onsite tests shall be
limited to three (3) tests according to AAMA 501.2. Any retests resulting
from failure will be at this trade contractors expense.
20. This contractor shall provide a dedicated project manager on site for the
duration of the Curtainwall work, and his foremen shall carry
walkie-talkie radios with the same frequency and channel as Turner so as
to be available at all times.
21. Unless otherwise directed, this contractor shall install all anchorage
attachments prior to the application of sprayed on fireproofing. Should
anchorage's be installed afterward, it will be this contractor's
responsibility to make the necessary repairs (only if excessive damage
occurs to spray on fireproofing), including cleaning and protection.
Failure to do so will result in Swiss Re Investors, Inc. performing the
work, and backcharging this contractor for all costs incurred.
22. Maintain during exterior Curtainwall construction the perimeter OSHA
cabling which will be initially installed by the Structural Steel
contractor. The start of maintenance will be after the first pass of
sprayed on fireproofing on the particular floor. When your installation
is complete in any given area, remove the cables and stanchions and bring
them to the ground floor and dispose of in the dumpsters provided by
others.
23. This Trade Contractor will be responsible for the work stored on the
floors or installed, until acceptance by the Owner/Architect. The
exterior portions of the Curtainwall system will be reviewed on a area by
area basis upon completion of areas of work. Acceptance of areas will not
be made until the system in that particular area is 100% complete
(includes copper siding and catwalks). There will be a separate
acceptance of the interior side of the Curtainwall on an area by area
basis for damage control.
24. Include in your bid out of sequence work normally associated with
construction of this type.
25. This trade contractor shall remove all debris resulting from his work to
a dumpster provided by Swiss Re Investors, Inc.. RUBBISH REMOVAL FOR THIS
WORK WILL BE ON A DAILY BASIS AND SHALL BE MAINTAINED IN A CONDITION AS
ACCEPTABLE TO TURNER AND SWISS RE INVESTORS, INC.
26. This contractor is responsible for all electrical requirements and
hook-ups which are necessary to perform his work.
Page 6 of 10
<PAGE> 71
** Confidential treatment requested pursuant to Rule 406
ADDITIONAL PROVISIONS/SCOPE OF WORK
-----------------------------------
CURTAINWALL
27. Include construction cleaning of your work, inside and out, to the
satisfaction of Turner. This Trade Contractor shall be responsible for
removal of all factory stickers, emblems, factory markings etc. All work
is to be left in a clean condition upon completion of the work. Final
cleaning is by others.
28. In addition to the indemnification required in the Trade Contract, this
Trade Contractor shall further hold Swiss Re Investors, Inc. harmless to
the same degree for claims arising out of this contractor's errors and
omissions in the Curtainwall design documents. Curtainwall contractor
shall provide to Swiss Re Investors, Inc. evidence of PROJECT SPECIFIC
PROFESSIONAL LIABILITY COVERAGE IN THE MINIMUM AMOUNT OF ** WITH
NO GREATER THAN A ** DEDUCTIBLE. CONTINUING EVIDENCE OF THE RENEWAL
OF SUCH COVERAGE MUST ALSO BE PROVIDED, UP UNTIL SUCH DATE AS LEGAL
ACTION MAY NO LONGER BE BROUGHT IN ACCORDANCE WITH APPLICABLE STATUTES.
Deductibles will be the full responsibility of this contractor.
29. The Trade contractor shall furnish all attic stock as required by the
contract documents.
30. This Trade contractor shall furnish and install a mock-up per the
contract documents including all calculations, drawings, laboratory fees,
chamber preparation, etc. Any/all re-testing fees as a result of whole
or partial failure of any components shall be borne by this trade
contractor. It is agreed that this mock up is not for any specific
aesthetic purposes.
31. All fasteners to aluminum components in potentially wetted areas shall be
stainless steel. All fasteners to copper will be hard grade copper alloy
and copper cleats as specified.
32. As discussed in length at the pre-award meetings, the terrain is somewhat
difficult in various locations on the site. Limited perimeter access will
be available at some locations. This Trade contractor is aware of the
existing terrain conditions and hereby acknowledges that it has included
all costs associated with these site conditions in the base contract
price.
33. This Trade contractor shall furnish and install all wood blocking and
nailers as required within the Curtainwall system.
34. The operable windows shall conform to the applicable industry standard
tolerance for air infiltration and not to the tolerances of the
Curtainwall itself.
35. This Trade contractor shall provide a Curtainwall system that will
maintain the specified minimum one (1) hour fire rating.
36. Deleted.
37. As discussed in the pre-award meetings, this Trade contractor is aware
the design consultants will be revising the panic hardware on the doors
which will allow for the intended door profile. This Trade contractor has
included both the hardware for these doors as well as the intended door
profile as desired by the design consultants.
38. All structural members of the Curtainwall system shall be a minimum of
3mm as specified in the contract documents. Any non-structural component
of the system which is not to the minimum 3mm thickness will be subject
to the review and acceptance by the design consultants prior to
fabrication.
Page 7 of 10
<PAGE> 72
ADDITIONAL PROVISIONS/SCOPE OF WORK
-----------------------------------
CURTAINWALL
39. This trade contractor has included three (3) leave out areas in the
Curtainwall system from top to bottom of the building, minimum 20' wide
as directed by the construction manager prior to fabrication. Any
additional leave out areas that may be required should reference the unit
price section of the additional provisions.
40. As discussed in the pre-award meetings with Adamson Associates, Israel
Berger, RWG, Turner, this trade contractor shall incorporate specific
design details discussed and agreed to between all parties as indicated
on preliminary drawings and sketches submitted by this trade contractor.
These drawings and sketches were modified during this process to more
closely reflect the intentions of the design consultants and such
modifications shall also be incorporated into this base contract price.
For purposes of design intent the following are documents are Referenced
and part of this agreement:
1.) FCAM Drawing SK-1 Revision A "Contract Document" dated 04/17/97
2.) FCAM Drawing SK-2 Revision B "Contract Document" dated 04/17/97
3.) FCAM Drawing SK-3 Revision A "Contract Document" dated 04/17/97
4.) FCAM Drawing SK-4 Revision A "Contract Document" dated 04/17/97
5.) FCAM Drawing SK-5 Revision A "Contract Document" dated 04/17/97
6.) Adamson Associates Letter to Tony Riggi dated 04/22/97 - ATTACHMENT
'H'
7.) Adamson Associates Letter to Tony Riggi dated 04/22/97 - ATTACHMENT
'H'
41. As discussed in the pre-award meetings, reglazing from the interior will
be possible with minor removals from adjacent interior finish trades
(ceilings, blinds, blind pockets).
42. This trade contractor acknowledges that the proposed Curtainwall system
(stick system) has a large quantity of field applied seals. This issue
was discussed at the pre award meetings in great detail. The majority of
the concerns regarded the ability to make good seals in cold and wet
weather conditions. The sealing activity will be monitored heavily and
seals must not be completed if conditions do not permit proper
installation according to the specifications. In the event that weather
limitations prevent the ability to complete field seals according to the
progress schedule, this trade contractor will take all necessary actions
to assure that the Curtainwall milestone dates a upheld at its sole cost.
43. This trade contractor shall furnish and install all insulation as
indicated in the contract documents, including mullion wrapping.
44. This trade contractor shall furnish and install a firestop/smoke seal
that is acceptable to the contract documents and the design consultants.
45. This trade contractor shall be responsible to work out the detail with
the design consultants to provide a seal continuity/flashing detail
between the Curtainwall system and the roof as discussed at the pre-bid
meetings. The detail should allow for movement. All costs associated with
same are included in the base contract price.
46. This trade contractor has include all costs to provide
ventilation/drainage (perforations) of the soffit which are shown on the
contract documents.
47. This trade contractor has included all horizontal tubes/support at the
catwalk as aluminum.
48. This trade contractor has include all costs to provide protective
material (peel off) on the interior sill and vertical mullions (to be
removed by others).
Page 8 of 10
<PAGE> 73
** Confidential treatment requested pursuant to Rule 406
ADDITIONAL PROVISIONS/SCOPE OF WORK
-----------------------------------
CURTAINWALL
49. All manufacturer's warranties and extended warrantees are to be as
specified by the contract documents.
50. This trade contractor shall incorporate all cut-outs required as
determined by others ands noted on the approved or approved as noted
shop drawings for the Curtainwall.
51. The schedule is predicated on a two (2) week turnaround on this
trade contractors submittals after submission. This is also
predicated on a reasonable submittal package that can be turned
around in this timeframe (i.e., not 150 drawings all at once!)
D. EXCLUSIONS:
1. Soffits at the main entrance, loading dock, and cafeteria.
2. Stone at foundation walls.
3. Entrances and storefronts. Specifically, at the front of the
building, all work from column line 8 to 13 (except the
aluminum soffit), and at the rear from 8 to 13 at B1 level,
and from approximately 9.5 to 11.5 at the entry level and
level 2.
4. Metal louvers
5. Standing seam copper roof
6. Gypsum wallboard on metal studs.
7. Galvanized steel plate column covers at the loading dock.
8. Monorail trolley for the window washing equipment.
9. Responsibility to guarantee an STC of 40 (assumption made
Flour City that the design intent shown will meet the
STC-Joints are in question)
10. Liquidated damages
11. Replacement of Glass due to breakage not associated with
installation methods or workers of this trade
12. Final Cleaning (include cleaning as described above)
13. Patching of SOFP (unless determined excessive)
14. Handicap, security or automatic door equipment or hook-up of
the same
15. Stone work at bottom of Curtainwall
16. Safety Nets or maintaining of same
17. Travel expenses for non-employees of FCAM
18. Temporary light and power for the project as in Attachment 'E'
E. ALTERNATE PRICES:
The following ALTERNATE PRICES shall be valid until 06/30/97 and include
all things necessary for a complete installation.
1. Provide Okalux glass in the transom panel at B1 level, entry level
and second floor:
ADD: **
2. Deduct 100% PAYMENT AND PERFORMANCE BONDS:. (Surety must appear on
the Current U.S. Treasury Federal Register) Furthermore, the
following shall apply:
DEDUCT: **
3. SALES AND USE TAX for materials if project does not become tax
exempt.:
ADD: **
Page 9 of 10
<PAGE> 74
** Confidential treatment requested pursuant to Rule 406
ADDITIONAL PROVISIONS/SCOPE OF WORK
-----------------------------------
CURTAINWALL
4. INSURANCE ADD if owner does not provide Insurance Coverage as stated
in Exhibit 'B' of the General Conditions. Minimum insurance limits
of ** for General Liability and ** for Auto shall be in
accordance with provided with designates as required as
Additional Insured.
ADD: **
5. Delete convector covers in their entirety from the base bid.:
DEDUCT: **
6. Remove 1 hour fire rating requirement from the exterior wall.
DEDUCT: **
F. UNIT PRICES
The following UNIT PRICES shall be valid for the typical Curtainwall
system presently shown in Trade Contractors scope of work for the life of
the project and include all things necessary for a complete installation.
1. Aluminum Framing......................................: **
2. Standard Glass........................................: **
3. Okalux Glass..........................................: **
4. Copper Siding.......................................... **
5. Convector Cover........................................ **
6. Complete Curtainwall System............................ **
7. Standard Glass-Replacement Glass-Large Lite............ **
8. Standard Glass-Replacement Glass-Small Lite............ **
9. Okalux Glass-Replacement Glass......................... **
10. Additional leave out (top/bottom 20' wide)............. **
Page 10 of 10
<PAGE> 75
** Confidential treatment requested pursuant to Rule 406
RIDER 'A'
REVISED CONTRACT TERMS
1.) ADDITIONAL PROVISION PAGE 2 OF 10: The allowable combined percentage
mark-up for overhead and profit on direct costs of changes when work is
performed by the Trade Contractor shall be **. This same percentage
shall be allowed for any changes performed by Sub-trade contractors and
** may be added by the trade contractor to the Sub-trade contractor's
estimate. The total on all tiers shall not exceed ** in the aggregate.
In the case of change orders involving deletions for the work or other
cost savings, the deductions from the Contract Sum shall be at **
and shall include an additional deduction of ** for general conditions
and ** for profit. Markups shall be applied to the total net value of any
change or group of changes.
2.) TRADE CONTRACT PARAGRAPH #14: 1ST SENTENCE ...as will insure the proper
matching and fitting of the work covered by this agreement with
contiguous work. This Trade Contractor will be responsible to measuring
contiguous work as it relates to performing a survey of the existing slab
edge prior to field erection as well as layout for embeds. All other
dimensions will be fabricated from approved FCAM shop drawings and/or
contract documents.
3.) G/C PARAGRAPH 3.5.3 AND 4.4: The intent of these paragraphs remains the
same. It is understood that all major coordination will take place in the
presence of either The Construction Manager and/or the Project Manager.
Any unresolvable disputes will be decided by the Construction Manager
and/or the Project Manager.
4.) G/C PARAGRAPH 5.3.1 AND 5.3.2: The intent of these paragraphs remain the
same. It is understood that no schedule revision affecting the work of
this trade will take place without mutual agreement of this trade
contractor. Any schedule acceleration or delay is subject to review and
may result in a change order for time and cost adjustments.
5.) G/C PARAGRAPH 8.3.3: Insert "commence to remedy" after, If the trade
Contractor does not... in the 1st sentence.
6.) The Trade Contractor will have the ability to invoice and be paid with
proper documentation required by Swiss Re Investors, Inc. for
engineering, on and off site stored materials with the proper paper work
required by Swiss Re Investors, Inc. This trade Contractor will not be
allowed to bill for any mobilization costs or raw stock.
7.) G/C PARAGRAPH 10.2.1: ...The Owner, in its desecration, may not require
additional retainage after ** of the trade contractors work is
completed. This is modified to read; ...After ** of the work is
complete, the Owner, will not require additional retainage unless in its
sole desecration, it feels that the trade contractor is not current to
the construction schedule and/or has not produced work to an acceptable
level of quality.
8.) G/C PARAGRAPH 10.3.1 AND 10.3.2:-Final payment is to made no later than
** after date of Certificate of Final Completion.
9.) Swiss Re Investors, Inc. reserves the right to terminate this Agreement
pending formal closing pertaining to the sale of the land associated with
this project in writing in a format acceptable to Swiss Re Investors,
Inc. by 06/04/97. If this the sale of the property is not complete by
this date Swiss Re Investors, Inc. reserves the right to terminate this
agreement with the following liabilities:
** MOCK-UP ENGINEERING
** DIES
** PAYMENT AND PERFORMANCE BOND
** NOT TO EXCEED
In such an event, Swiss Re Investors shall only have liability to the
this Trade Contractor for Actual costs spent for the above items plus **
OH&P not to exceed **. Swiss Re Investors, Inc. shall have no
liability to make payments for other work performed by the Subcontractor
not specifically listed above, if any, or for anticipated profits.
<PAGE> 76
** Confidential treatment requested pursuant to Rule 406
Rider "A" (Continued)
10.) This contract is expressly contingent upon:
1.) On or before June 6, 1997 Swiss Re Investors, Inc. receipt of
certified financial statements of Flour City which are satisfactory
to Swiss Re Investors, Inc.; and
2.) On or before May 23, 1997 Swiss Re Investors, Inc. receipt of
reinsurance satisfactory to Swiss Re Investors, Inc. in the total
amount of ** of the surety bond executed by ** on behalf of
Flour City.
<PAGE> 77
ATTACHMENT "A"
SWISS RE AMERICA U.S. HEADQUARTERS TURNER
North Castle, NY 10-Mar-97
BID PACKAGE NO. 1 DRAWING LIST
DRAWING NO. TITLE DATE REV NO. REV DATE
08900 Curtain Wall 3/7/97
A1.02 Site Plan 2/27/97 2 3/7/97
A2.01 Key Plans B1 & B2 Level 1/3/97 2 3/7/97
A2.02 Key Plans Entry & 2nd Level 1/3/97 2 3/7/97
A2.03 Key Plans 3rd & Roof Level 1/3/97 2 3/7/97
A2.04 Plan-B2 Level (West) 1/3/97 2 3/7/97
A2.07 Plan-B1 Level (West) 1/3/97 2 3/7/97
A2.08 Plan-B1 Level (Center) 1/3/97 3 3/7/97
A2.09 Plan-B1 Level (East) 1/2/97 3 3/7/97
A2.10 Plan-Entry Level (West) 12/19/96 2 3/7/97
A2.11 Plan-Entry Level (Center) 12/19/96 2 3/7/97
A2.12 Plan-Entry Level (East) 12/19/96 2 3/7/97
A2.13 Plan-Level 2 (West) 1/7/97 2 3/7/97
A2.14 Plan-Level 2 (Center) 1/7/97 2 3/7/97
A2.15 Plan-Level 2 (East) 1/7/97 2 3/7/97
A2.16 Plan-Level 3 (West) 1/7/97 2 3/7/97
A2.17 Plan-Level 3 (Center) 1/7/97 2 3/7/97
A2.18 Plan-Level 3 (East) 1/7/97 2 3/7/97
A2.19 Plan-Roof (West) 1/7/97 2 3/7/97
A2.20 Plan-Roof (Center) 1/7/97 2 3/7/97
A2.21 Plan-Roof (East) 1/7/97 2 3/7/97
A3.10 Plan Details - Exterior Wall 2/19/97 2 3/7/97
A4.01 Building Elevations North 1/15/97 3 3/7/97
A4.02 Building Elevations North & West 1/15/97 3 3/7/97
A4.03 Building Elevations South 1/15/97 3 3/7/97
A4.04 Building Elevations South & East 1/15/97 3 3/7/97
A4.05 Building Section/Partial Elevation 1/20/97 3 3/7/97
A4.06 Building Section/Partial Elevation 1/20/97 3 3/7/97
A4.08 Building Section 1/29/97 3 3/7/97
A4.09 Building Section 1/29/97 3 3/7/97
A4.10 Building Section 2/4/97 3 3/7/97
A5.01 Curtainwall Details 2/10/97 2 3/7/97
A5.02 Curtain Wall Details 2/6/97 3 3/7/97
A5.03 Curtainwall Details 2/21/97 2 3/7/97
A5.04 Curtainwall Details 2/28/97 2 3/7/97
<PAGE> 78
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
128 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
1 Design Development ** ** ** |
45 |
46 Working Drawings - Core & Shell ** ** ** |
50 Early Packages ** ** ** |
51 Bid Pkg #1: Curtain Wall ** ** ** |
52 Bid Pkg #2: Site Work ** ** ** |
53 Bid Pkg #3: Str. Steel & Deck ** ** ** | [CHART]
54 Bid Pkg #4: Concrete ** ** ** |
55 Bid Pkg #5: Design / Build Garage ** ** ** |
56 Produce Remaining Bid Documents ** ** ** |
57 Working Documents - Fit-Out ** ** ** |
58 Prepare 100% CD's ** ** ** |
59 |
60 Bid & Award Trade Contracts ** ** ** |
61 Bid & Award Curtain Wall ** ** ** |
62 Bid & Award Site Work (Excavation & Utilities) ** ** ** |
63 Bid & Award Steel ** ** ** |
64 Bid & Award Concrete ** ** ** |
65 Bid & Award Design / Build Garage ** ** ** |
66 Bid Remaining Core & Shell Trades ** ** ** |
67 Bid Fit-Out Work ** ** ** |
68 |
69 Local Reviews & Approvals ** ** ** |
|
</TABLE>
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- --------------------------------------------------------------------------------
<PAGE> 79
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
228 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
70 P&Z ** ** ** |
89 FAA Application ** ** ** |
90 Apply for Site Permit ** ** ** |
91 Receive Site Permit ** ** ** |
92 Apply for Foundation Permit ** ** ** |
93 Receive Foundation Permit ** ** ** |
94 Apply for Building Permit ** ** ** |
95 Receive Building Permit ** ** ** | [CHART]
96 |
97 Ground Breaking CEREMONY ** ** ** |
98 |
99 Construction ** ** ** |
100 Site Work ** ** ** |
101 |
102 Erosion Control & Site Logistics Prep - CREW 1 ** ** ** |
103 Survey & Layout ** ** ** |
104 Tag Trees ** ** ** |
105 Temporary Parking Lot ** ** ** |
106 Erosion Control Program ** ** ** |
107 Protect Trees ** ** ** |
108 DEP Requirements ** ** ** |
109 |
110 Building Footprint ** ** ** |
|
</TABLE>
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- --------------------------------------------------------------------------------
<PAGE> 80
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
328 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
111 Clear and Grub ** ** ** |
112 Cut and Fill - SEE LINE 219 ** ** ** |
113 |
114 Service Road ** ** ** |
115 Clear and Grub ** ** ** |
116 Cut and Fill ** ** ** |
117 Subbase Installation ** ** ** |
118 Curbing ** ** ** | [CHART]
119 Asphalt Binder Course ** ** ** |
120 Final Top Asphalt ** ** ** |
121 Striping ** ** ** |
122 Topsoil ** ** ** |
123 Seed and Stabilize ** ** ** |
124 |
125 Main Road - Bldg to Service ** ** ** |
126 Clear and Grub ** ** ** |
127 Cut and Fill ** ** ** |
128 Subbase Installation ** ** ** |
129 Curbing ** ** ** |
130 Asphalt Binder Course ** ** ** |
131 Final Top Asphalt ** ** ** |
132 Striping ** ** ** |
133 Topsoil ** ** ** |
|
</TABLE>
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- --------------------------------------------------------------------------------
<PAGE> 81
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
428 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
134 Seed and Stabilize ** ** ** |
135 |
136 Main Road - Service to Rte 120 - CREW 2 ** ** ** |
137 Clear and Grub ** ** ** |
138 Cut and Fill ** ** ** |
139 Subbase Installation ** ** ** |
140 Curbing ** ** ** | [CHART]
141 Asphalt Binder Course ** ** ** |
142 Final Top Asphalt ** ** ** |
143 Striping ** ** ** |
144 Topsoil ** ** ** |
145 Seed and Stabilize ** ** ** |
146 |
147 Loading Dock Area ** ** ** |
148 Clear and Grub ** ** ** |
149 Cut and Fill ** ** ** |
150 Subbase Installation ** ** ** |
151 Curbing ** ** ** |
152 Asphalt Binder Course ** ** ** |
153 Final Top Asphalt ** ** ** |
154 Striping ** ** ** |
155 Topsoil ** ** ** |
156 Seed and Stabilize ** ** ** |
</TABLE>
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- --------------------------------------------------------------------------------
<PAGE> 82
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
528 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
157 |
158 Fire Lane ** ** ** |
159 Clear and Grub ** ** ** |
160 Cut and Fill ** ** ** |
161 Subbase Installation ** ** ** |
162 Curbing ** ** ** |
163 Grass Paver ** ** ** |
164 Topsoil ** ** ** |
165 Seed and Stabilize ** ** ** |
166 |
167 Garage ** ** ** | [CHART]
168 Clear and Grub ** ** ** |
169 Line Drilling ** ** ** |
170 Rock Blasting ** ** ** |
171 Excavation ** ** ** |
172 Rock anchors ** ** ** |
173 Foundations ** ** ** |
174 Outfall Netting ** ** ** |
175 Perimeter Protection Wall/Fencing ** ** ** |
176 |
177 Site Utilities ** ** ** |
178 Storm Drainage ** ** ** |
179 Sanitary Service ** ** ** |
</TABLE>
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- --------------------------------------------------------------------------------
<PAGE> 83
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
628 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
180 Electrical & Telephone Ductbanks ** ** ** |
181 Domestic Water from wells ** ** ** |
182 Fire Service ** ** ** |
183 Site Lighting ** ** ** |
184 Light Pole Bases ** ** ** |
185 |
186 Site Improvements ** ** ** |
187 Sidewalks ** ** ** |
188 Main Entrance Stairs ** ** ** |
189 Excavation ** ** ** | [CHART]
190 Footings/Walls ** ** ** |
191 Backfill ** ** ** |
192 Subbase Installation ** ** ** |
193 Stone ** ** ** |
194 Stone @ Walkway Subbase ** ** ** |
195 Excavation ** ** ** |
196 Footings/Walls ** ** ** |
197 Backfill ** ** ** |
198 Subbase Installation ** ** ** |
199 Stone ** ** ** |
200 |
201 Pumphouse & Cooling Tower ** ** ** |
202 Footings/Walls ** ** ** |
</TABLE>
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- --------------------------------------------------------------------------------
<PAGE> 84
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
728 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
203 Backfill ** ** ** |
204 Excavate for MEP ** ** ** |
205 Install MEP ** ** ** |
206 Backfill ** ** ** |
207 |
208 Remove Construction Parking / RESEED ** ** ** |
209 Landscaping ** ** ** |
210 Final Topsoil ** ** ** |
211 Fall Planting 1998 ** ** ** |
212 Seeding/Sod ** ** ** |
213 Flagpole work ** ** ** |
214 |
215 Headquarters ** ** ** | [CHART]
216 BUILDING EXCAVATION & FOUNDATIONS ** ** ** |
217 PHASE A ** ** ** |
218 PHASE A ROCK BLASTING ** ** ** |
219 PHASE A EXCAVATE ** ** ** |
220 PHASE A ROCK ANCHORS ** ** ** |
221 PHASE A FOOTINGS ** ** ** |
222 PHASE A FOUNDATION WALLS ** ** ** |
223 PHASE A WATERPROOFING ** ** ** |
224 PHASE A BACKFILL ** ** ** |
225 ELEVATOR JACKHOLE ** ** ** |
</TABLE>
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- --------------------------------------------------------------------------------
<PAGE> 85
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
828 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
226 MEP UNDERGROUND ** ** ** |
227 SUBBASE ** ** ** |
228 SLAB-ON GRADE ** ** ** |
229 |
230 PHASE B ** ** ** |
231 PHASE B ROCK BLASTING ** ** ** |
232 PHASE B EXCAVATE ** ** ** |
233 PHASE B ROCK ANCHORS ** ** ** |
234 PHASE B FOOTINGS ** ** ** |
235 PHASE B FOUNDATION WALLS ** ** ** |
236 PHASE B WATERPROOFING ** ** ** |
237 PHASE B BACKFILL ** ** ** |
238 ELEVATOR JACKHOLE ** ** ** | [CHART]
239 MEP UNDERGROUND ** ** ** |
240 SUBBASE ** ** ** |
241 SLAB-ON GRADE ** ** ** |
242 |
243 PHASE C ** ** ** |
244 PHASE C ROCK BLASTING ** ** ** |
245 PHASE C EXCAVATE ** ** ** |
246 PHASE C ROCK ANCHORS ** ** ** |
247 PHASE C FOOTINGS ** ** ** |
248 PHASE C FOUNDATION WALLS ** ** ** |
</TABLE>
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- --------------------------------------------------------------------------------
<PAGE> 86
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
928 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
249 PHASE C WATERPROOFING ** ** ** |
250 PHASE C BACKFILL ** ** ** |
251 ELEVATOR JACKHOLE ** ** ** |
252 MEP UNDERGROUND ** ** ** |
253 SUBBASE ** ** ** |
254 SLAB-ON GRADE ** ** ** |
255 |
256 Superstructure ** ** ** |
257 Lead Time Structural Steel ** ** ** |
258 Award Subcontract ** ** ** |
259 Shop Drawings ** ** ** |
260 Formal Mill Order ** ** ** |
261 Fabricate 1st 40% of project ** ** ** | [CHART]
262 START STEEL ERECTION ** ** ** |
263 Steel / Deck Erection ** ** ** |
264 Fill on Metal Deck ** ** ** |
265 SOFP ** ** ** |
266 Envelope ** ** ** |
267 Prepare & Test CW Mock-up ** ** ** |
268 Mock-Up Shop Drawings & Approval ** ** ** |
269 Fabricate Mock-Up ** ** ** |
270 Erect Mock-Up @ Test Facility ** ** ** |
271 Test Mock-Up ** ** ** |
</TABLE>
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<PAGE> 87
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
1028 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
272 Approval/Release Mock-Up ** ** ** |
273 Fabricate Curtainwall ** ** ** |
274 Complete Shop Drawings ** ** ** |
275 Review & Approve Shop Drawings ** ** ** |
276 Release Custom Extrusions ** ** ** |
277 Embed Installation ** ** ** |
278 Fabricate Extrusions ** ** ** |
279 Release Glass ** ** ** |
280 Fabricate Glass ** ** ** |
281 Erect Curtain Wall ** ** ** |
282 PHASE A ** ** ** |
283 BUILDING READY PRE-RECTION P ** ** ** |
284 MULLIONS & BACKPANS ** ** ** | [CHART]
285 CATWALKS ** ** ** |
286 INSTALL COPPER ** ** ** |
287 WATERTIGHT ** ** ** |
288 PHASE B ** ** ** |
289 BUILDING READY PHASE B ** ** ** |
290 MULLIONS & BACKPANS ** ** ** |
291 CATWALKS ** ** ** |
292 INSTALL COPPER ** ** ** |
293 WATERTIGHT ** ** ** |
294 PHASE C ** ** ** |
</TABLE>
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<PAGE> 88
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
1128 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
295 BUILDING READY PHASE C ** ** ** |
296 MULLIONS & BACKPANS ** ** ** |
297 CATWALKS ** ** ** |
298 INSTALL COPPER ** ** ** |
299 WATERTIGHT ** ** ** |
300 CURTAINWALL SUBSTANTIAL COMP ** ** ** |
301 Lobby / Entrance Systems ** ** ** |
302 Roofing ** ** ** |
303 Insul Bd & Membrane Roofing ** ** ** |
304 Metal Roofing ** ** ** |
305 Final Building Water Tight ** ** ** |
306 Interior Finishes ** ** ** |
307 Stud Core Partitions ** ** ** | [CHART]
308 Sheetrock Core Partitions ** ** ** |
309 Toilet Room Tile & Stone Work ** ** ** |
310 Core Ceilings ** ** ** |
311 Vertical Transportation ** ** ** |
312 Elevators ** ** ** |
313 Fire Protection ** ** ** |
314 Fire Protection Risers/Distribution ** ** ** |
315 Fire Protection Drops/Heads ** ** ** |
316 Mechanical & Plumbing ** ** ** |
317 Plumbing Risers/Distribution ** ** ** |
</TABLE>
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<PAGE> 89
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
1228 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
318 Toilet Roughing ** ** ** |
319 Toilet Fixtures ** ** ** |
320 Ductwork Risers ** ** ** |
321 MEP - Equipment/Plant ** ** ** |
322 Temperature Controls/Balancing ** ** ** |
323 Commissioning ** ** ** |
324 Electrical ** ** ** |
325 Electrical Feeders ** ** ** |
326 Electrical Distribution ** ** ** |
327 Fire Alarm System ** ** ** |
328 Access Flooring ** ** ** |
329 Main Lobby ** ** ** |
330 | [CHART]
331 Fit-Out ** ** ** |
332 Partitions - Framing ** ** ** |
333 Partitions Sheetrock ** ** ** |
334 Ductwork Mains ** ** ** |
335 Branch Ducts ** ** ** |
336 Ceiling Grid ** ** ** |
337 RGD's ** ** ** |
338 Lighting Fixtures ** ** ** |
339 Ceiling Pads ** ** ** |
340 Painting ** ** ** |
</TABLE>
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<PAGE> 90
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
1328 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
341 Flooring ** ** ** |
342 Wiring/Devices ** ** ** |
343 Specialties ** ** ** |
344 Kitchen Fit-out-Equipment/MEP ** ** ** |
345 Fitness Center ** ** ** |
346 Furniture Systems ** ** ** |
347 Executive Area ** ** ** |
348 Conference Center ** ** ** |
349 Audio Visual Systems ** ** ** |
350 Dining Room / Servery ** ** ** |
351 Communications ** ** ** |
352 Phone & Data Systems ** ** ** |
353 | [CHART]
354 Punch List ** ** ** |
355 Substantial Completion/Inspections & Approval ** ** ** |
356 Final Completion ** ** ** |
357 |
358 Parking Garage ** ** ** |
359 Foundations/Excavation/Rock ** ** ** |
360 MEP UndergroundFinish at Grade ** ** ** |
361 Winter Season Factor ** ** ** |
362 Parking Structure/Stairs ** ** ** |
363 Exterior/Caulking/Sealants ** ** ** |
</TABLE>
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<PAGE> 91
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
1428 Swiss Re America Headquarters REVISION NO 1
CONSTRUCTION SCHEDULE Curtainwall Contract
Sitework Bid package
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------- |
ID Task Name Dur. Start Finish |
- ------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
364 MEP Distribution/Fixtures ** ** ** |
365 Finishwork ** ** ** |
366 Clean-up and Stripping ** ** ** |
367 Substantial Completion ** ** ** | [CHART]
368 |
369 Owner Activities ** ** ** |
370 FF&E ** ** ** |
371 MOVE-IN ** ** ** |
</TABLE>
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<PAGE> 92
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
FCAM Schedule (5/12/97) As Revised Works in Conjunction with Turner Schedule
dated 5/16/97,
- --------------------------------------------------------------------------------
Flour City Architectural Metals - Curtainwall Design & Construction Schedule
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
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ID Task Name Duration Start Finish |
- ----------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
1 Curtainwall Subcontract Work ** ** ** |
2 Subcontract Award ** ** ** |
3 |
4 Mockup ** ** ** |
5 Design Shapes, prep & subm ** ** ** |
6 Milestone: Design Shapes, submit ** ** ** |
7 Design Shapes, approve & return ** ** ** |
8 Shop Drawings, prep & 1st subm ** ** ** |
9 Milestone: Mockup shop drwgs, submit ** ** ** |
10 Shop Drawings, approve & return ** ** ** |
11 Shop Drawings, record set ** ** ** |
12 Die drawings, construction & samples ** ** ** |
13 BM's & Listing ** ** ** |
14 Material Submittals ** ** ** |
15 Glass Procurement ** ** ** | [CHART]
16 Material Procurement ** ** ** |
17 Fabrication & Subassembly ** ** ** |
18 Ship, Erect, Glaze & Pretest ** ** ** |
19 Milestone: Mockup erected, ready for test ** ** ** |
20 Formal Testing ** ** ** |
21 |
22 Project ** ** ** |
23 Shop Drawings, 1st area, prep & subm ** ** ** |
24 Shop Drawings, 1st area, appr & return ** ** ** |
25 Shop Drawings, 1st area, record set ** ** ** |
26 Shop Drawings, 2nd area, prep & subm ** ** ** |
27 Shop Drawings, 2nd area, appr & return ** ** ** |
28 Shop Drawings, 2nd area, record set ** ** ** |
29 Die Drawings, construction & samples ** ** ** |
</TABLE>
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Project: Swiss Re America Headquarters [CHART SYMBOLS]
Date: May 12 '97
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Page 1
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<PAGE> 93
** Confidential treatment requested pursuant to Rule 406
Attachment "B"
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Flour City Architectural Metals - Curtainwall Design & Construction Schedule
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------- |
ID Task Name Duration Start Finish |
- ----------------------------------------------------------------------------------------------- |
<S> <C> <C> <C> <C> |
|
30 BM's & Listing, 1st area ** ** ** |
31 BM's & Listing, 2nd area ** ** ** |
32 Embed Installation ** ** ** |
33 Material Procurement ** ** ** |
34 Glass Procurement ** ** ** |
35 Fabrication & Subassembly ** ** ** |
36 Pre-erection field work (building ready) ** ** ** |
37 Milestone: Begin erection of wall panels ** ** ** |
38 Erect & Glaze Curtainwall ** ** ** |
39 Milestone: Curtainwall dried-in ** ** ** |
40 Milestone: Curtainwall substant complete ** ** ** |
41 Installation Copper Cladding & Seal ** ** ** |
42 Milestone: Copper siding substant compl ** ** ** |
43 Catwalk Installation ** ** ** |
44 | [CHART]
45 Scheduling Assumptions: ** ** ** |
46 1. two wk total appr'l turn around on submittals ** ** ** |
47 2. approved or approved as noted after 1st ** ** ** |
48 submittal to release material production ** ** ** |
49 3. 2nd subm for record only ** ** ** |
50 4. RFI response within 48 hours ** ** ** |
51 ** ** ** |
52 6. TCCO provide Architect Autocad files to ** ** ** |
53 FCAM by June 16, 1997 ** ** ** |
54 7. Applicable half of building structures shall be or Phase "A" |
55 ready for FCAM work by Jan 14, 1998. ** ** ** |
56 8. Schedule for field work does not include Storm, Snow Related Only |
57 weather delays; add day for day. ** ** ** |
58 8. Punchlist work not included in above. ** ** ** |
</TABLE>
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Project: Swiss Re America Headquarters [CHART SYMBOLS]
Date: May 12 '97
- --------------------------------------------------------------------------------
Page 2
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<PAGE> 94
ATTACHMENT "C"
MARCH 19, 1997 SWISS RE AMERICA
NORTH CASTLE, NY
SPECIAL PROVISIONS FOR ALL TRADE CONTRACTORS AND VENDORS
1. GENERAL REQUIREMENTS
1.1 These Special Provisions are in addition to the Plans, Specifications
and other contract Documents. In cases of contradictions, the more
stringent requirement shall apply.
1.2 Each Trade Contractor is expected to be experienced and familiar with
the requirements and conditions encountered during typical building
construction and familiar with the conditions encountered in the
necessary performance of "out of sequence work". This terminology
shall include "comeback", but is not limited to work that may be
necessary for the removal of hoists, plant, temporary wire and piping,
protection, etc. It shall also include a normal amount of "comeback"
to complete work on each level or location. "Out of sequence" work
shall include phasing of the construction cycle to accommodate the
installation of the work of all Trade Contractors in a logical and
orderly fashion.
1.3 It is understood that the firm lump sum proposal submitted shall be in
strict accordance with plans, specifications and other Contract
Documents. Substitutions will not be allowed unless specifically
outlined in the proposal and accepted by the Architect and Owner at
the time of award.
1.4 The lump sum price shall be firm for the life of the project and
includes all escalation costs.
1.5 Except for the basic building permit, the Trade Contractor's lump sum
price shall include all permits, fees, inspections, sign-offs, and
approvals applicable to their work whether temporary or permanent.
This includes costs for securing and maintaining for the life of the
project all permits, Professional Engineer licensing, connection fees,
etc., applicable to their work as well as any permits to be issued as
required for the contract work. This may also include permits for
off-hours work. Originals of all permits are to be furnished to the
Owner prior to commencement of this work.
1.6 The Trade Contractor is to submit with his bid, a list of names and
titles of the authorized person or persons representing the company
and responsible for management and/or field operation.
1.7 The Trade Contractor must have site supervision with a beeper or
cellular phone for access while his work or the work of his
Subcontractors is in progress. The Trade Contractor shall not use
Turner's field office phone except during emergencies.
2. SITE ACCESS/CONTRACTORS USE OF PREMISES
2.1 All Trade Contractors are to strictly instill in the manpower they
provide on the job site that there will be no drugs or alcoholic
beverages permitted on the premises at any time including lunch.
Personnel observed to be intoxicated, or possessing drugs or alcoholic
beverages will be dismissed. Proper dress will be enforced. There will
be no construction personnel working without proper construction
clothing, safety shoes, shirts and hard hats.
2.2 Storage and delivery of material and equipment at the site shall be
permitted only to the extent approved in advance by Turner, and if
anything so stored obstructs the progress of any portion of work, it
shall be promptly removed or relocated by the Trade Contractor without
reimbursement. If not removed or relocated within 24 hours, Turner
will do so with its own forces and backcharge the responsible Trade
Contractor. In addition, facilities for storage at the site will be
limited and it shall be the Trade Contractor's responsibility to make
whatever arrangements may be necessary for offsite storage to insure
proper material availability for maintaining of job progress at no
additional cost. If a local storage yard is required, all costs
associated with this storage yard including receiving, unloading,
storing, shake-out, reloading, and delivery to the site shall be this
Trade Contractor's cost. This Trade Contractor will be assigned
specific real estate on the site to execute your work. However, the
site cannot be used as a prefab shop and all work
<PAGE> 95
ATTACHMENT "C"
MARCH 19, 1997 SWISS RE AMERICA
NORTH CASTLE, NY
cannot be delivered to the site at once. Should your material impede
the work of other trades, you must relocate at your own cost.
2.3 The Trade Contractor shall assume full responsibility for the
protection and safekeeping of products under his contract stored on
the site. Protection of finished work, whether stored or in place,
until acceptance of the Trade Contractor's work by Turner,
Architect/Engineer and Owner shall be furnished, installed,
maintained and removed as directed by Turner.
2.4 No photographs within the limits of construction will be permitted
without specific approval of the Owner.
2.5 There will be limited on-site parking for employees. Cars parked on
site are to leave at 4:30 p.m. unless working overtime. Cars/trucks
will be towed at the Trade Contractor's expense should this rule not
be followed.
2.6 The Trade Contractor shall protect all existing construction paying
particular attention to sidewalks, roadways, pavement, hydrants,
signs, fences, erosion controls etc., which are both inside and
outside of the construction boundaries. It is the Trade Contractor's
responsibility to assure that no damage occurs while moving in or out
of the site, hoisting materials, performing utility work, etc. Any
damage caused by the Trade Contractor's operations will be repaired
by the Trade Contractor at their expense. Should the Trade Contractor
fail to repair such damage, Turner will make the required repairs and
backcharge the Trade Contractor for the costs, including a 20%
management charge.
2.7 Access to the site is to be in strict accordance with Turner's site
logistics plan as listed in the additional provisions. Any exceptions
taken or undue restrictions imposed by logistics plan will not be
considered after award of subcontract. Trade Contractor shall
cooperate with Turner as the logistics plan is updated.
2.8 All trees, shrubs, wetlands, existing structures and utilities, etc.
shall be protected and all work shall be planned, scheduled and laid
out to avoid damage. Trade Contractors shall bear the cost of
repairing any such damage.
2.9 Normal work hours for this project shall be from 8:00 A.M. to 4:30
P.M. on all normal trade workdays. If work is required beyond normal
work hours; all arrangements in the form of permits, fees,
protection, standby trades, temporary facilities (temporary,
electric, water, heat) etc., will be the responsibility of the Trade
Contractor. Twenty-four hour notice must be given if the Trade
Contractor intends to work overtime.
2.10 Pedestrian and vehicular traffic on adjacent streets shall be
maintained at all times. Trade Contractor shall provide flagmen or
other personnel as required by local authorities at all times when
Trade Contractor's operations are exposed to the public [which may
include uniformed Town of North Castle policemen] at this Trade
Contractor's expense.
2.11 Trade Contractor shall limit trucking to Route 120. In addition,
Trade Contractor shall notify Turner of any required street closings
and make such arrangements with authorities having jurisdiction
including permit fees, barricades, policemen, etc.
2.12 All deliveries shall be scheduled with 48 hours notice. Trade
Contractor shall include in its contract price any off-hours
deliveries as may be required by nature of the work, schedule or site
access.
2.13 Provide all site fence maintenance and repair resulting from Trade
Contractor's work.
3. CUTTING AND PATCHING
3.1 Each Trade Contractor shall be responsible for all cutting and
patching which may be required in connection with their work. If work
is not coordinated and installed at the appropriate time, the Trade
Contractor will be responsible for all costs associated with
removals, patching, or if required by Architect, replacement of
damaged materials. Damage to finished work from the installation of
late or faulty work by persons unknown shall be backcharged on a
pro-rata basis to Trade Contractors having performed work in the
area.
<PAGE> 96
ATTACHMENT "C"
March 19, 1997 Swiss Re America
North Castle, NY
3.2. When patching or repairing new or existing work, Trade Contractor shall
employ only workmen skilled in the appropriate trade and the final product
shall be as new.
3.3. The trade Contractor shall not cut or alter any completed or installed
portion of the Work without the prior written approval of the Owner. Any
request by the Trade Contractor for such approval shall be in the form of
a submission pursuant to Article 6 of the General Conditions. The
submission shall show the nature and extent of the cutting or alteration
to be performed and the method of restoration of the cut or altered Work
so that the finished Work shall comply in all respects with the Contract
Documents. Such submissions shall be approved only if the proposed cutting
or alteration (a) is necessary, (b) shall not adversely affect the
structural integrity or moisture resistance or watertight integrity,
air-tight integrity or design capacity of any element of the Project, (c)
shall not require modification of the Contract Documents or change in
other items of work, (d) shall not result in a cost disadvantage to the
owner, (e) shall be protected by guaranties at least as stringent as
those required in the Contract Documents for the Work affected and (f)
shall be in conformity with the intent of the Contract Documents.
4. COORDINATION WITH OTHER TRADE CONTRACTORS
4.1. The Trade Contractor agrees that he has become familiar with the
site, has reviewed the plans and specifications covering the work of
his and other trades and thereby accepts responsibility for all
necessary coordination of his work with the work or other trades
affected. If the Trade Contractor installs any work prior to proper
coordination, or in such manner as to cause interference with work
of others, they shall arrange for removal of, or arrange for
necessary modifications to the work. Any such action is subject to
the approval of Turner and shall be at no additional cost to Turner
or the Owner.
4.2 The Trade Contractor shall allow sufficient time to inspect and
accept the work of all previous Trade Contractors. Should any
discrepancies be discovered, Turner shall be notified in writing
sufficiently in advance, but not more than 24 hours after the
discrepancy is discovered, so that corrective action can be
accomplished without affecting the progress of any Trade Contractor.
Start of this Trade Contractor's work shall constitute acceptance of
all previous Trade Contractor's work. All cost associated with
removal and reinstallation of all work due to noncompliance with the
above shall be the responsibility of this Trade Contractor.
5. ACCOUNTING
5.1. Monthly application for progress payments shall be made in
accordance with the procedure set forth in the General Conditions,
in addition a "penciled" copy should be submitted to and reviewed
with Turner's field representative 1 week prior to the formal
application. All payment applications should include projected work
through to the end of the month. Turner reserves the right to revise
the above procedure as needs dictate.
5.2. Trade Contractors furnishing operating systems should note that any
reduction in the retention withheld will not be entertained until
operating manuals are submitted and approved and other requirements
stated in this contract are met in a form acceptable to Turner and
the Owner, equipment and systems are operational and the
training/turnover period has been completed.
5.3. Certified payroll is to be provided if required by the Owner as well
as subcontracts and purchase orders.
6. CONSTRUCTION SCHEDULES
6.1. Progress of the Trade Contractor's work shall meet the Specified
Progress of the Project.
6.2. "Specific Progress" shall be defined as such progress as will
maintain the Schedule as set by Turner, precedent and contiguous
trades, and such progress as will not delay the Schedule of next
dependent trades, all to the entire satisfaction of Turner so as not
to delay the completion of the whole or any part of the work. It
shall be understood and agreed that the Construction Schedule may be
revised from time to time in order to meet project completion date
requirement
<PAGE> 97
ATTACHMENT "C"
MARCH 19, 1997 SWISS RE AMERICA
NORTH CASTLE, NY
6.3 In the providing of the work as set forth under this Agreement, it
is established that time is of the essence. All submittals and or
resubmittals shall be made so as to allow ample time to fabricate
and deliver applicable materials and equipment as required by the
Project Schedule as prepared by Turner's Project Superintendent. All
work shall be provided in accordance with this Schedule to the full
satisfaction of Turner's Superintendent and so as to fulfill that
portion of the obligation of Turner to the Owner as made the
responsibility of this Trade Contractor by virtue of this Agreement.
6.4. Turner and the Trade Contractor shall coordinate schedules with the
schedules of the other Trade Contractors. Conflicts among schedules
of the various Trade Contractors will be resolved by Turner.
6.5. The Trade Contractor shall furnish Turner with the following
information pertaining to his work within 5 days of Subcontract
award. No application for payment will be processed until all
information is received:
6.5.1. Total man-days required to perform the major items of work
broken down into meaningful detail as required for planning
by Turner.
6.5.2 Estimated weeks required to complete the work in each of the
major areas outlined above. Include crew sizes.
6.5.3. A schedule which combines both manpower and time
requirements.
6.5.4. A schedule detailing the shop drawings, fabrication sequence
and time required for fabrication and delivery of major
material and equipment including engineering and approvals.
6.5.5. Monthly work in place and cash flow projections.
6.5.6. All Trade Contractor schedules shall be updated and kept
current throughout the Project for review by Turner.
6.5.7. Submittal schedule for shop drawings, product data, samples,
warranties and O&M manuals. Submittals which do not conform
to the approved schedule may be subject to delays in
processing. Submittal schedules shall indicate engineering
time, fabrication time and anticipated date or delivery
conforming to Turner's Project Schedule.
6.5.8. List of vendors and Trade Contractors with a description of
their scope for approval regardless of whether such vendors
are pre-approved in specification.
6.6. The Trade Contractor shall be responsible for expediting the
fabrication and delivery of its materials and shall coordinate
material delivery schedules with Turner. Should, in the opinion of
Turner, it become necessary in order to maintain scheduled job
progress to supplement the Trade Contractor's expediting efforts,
then all costs incurred by Turner will be charged to this Trade
Contractor as Turner may elect.
7. SHOP DRAWINGS, PRODUCT DATA AND SAMPLES
7.1. In addition to requirements of Architect, the Trade Contractor shall
submit shop drawings, product data and samples to Turner in
accordance with the following:
7.1.1. Shop drawings - one reproducible transparency and six opaque
reproductions.
7.1.2. Manufacturer's literature including catalog cuts, brochures,
charts, test data, any similar information - 7 copies
7.1.3. Samples - four of each.
7.1.4. In the case of the HVAC Trade Contractor, one set of
reproducible mylar transparencies shall be required for
coordination.
7.1.5. Turner will retain the architect's commented shop drawing
reproducible and return one (1) print and/or one (1) sample
to the Trade Contractor.
7.2. In addition to the requirements of General Conditions Article
6.1.2.b, submittals by the Trade Contractor shall contain:
<PAGE> 98
ATTACHMENT "C"
MARCH 19, 1997 SWISS RE AMERICA
NORTH CASTLE, NY
7.2.1. Applicable standards, such as ASTM, Federal Specification
numbers.
7.2.2. Identification of deviations from Contract Documents.
7.2.3. Identification of revisions on resubmittals other than those
noted on previous submittals (including changes on shop
drawings) is required.
7.3. It is the responsibility of the Trade Contractors to verify that all
submitted shop drawings conform with the requirements of the Contract
Document and that all dimensions, conditions and quantities are
verified as shown and/or corrected on each submittal; that the
submittal is in sufficient detail to serve its intended purpose; and
that all previous applicable changes made in the Project by Change
Orders and other Turner directives have been properly shown on each
submittal affected.
7.4. On resubmissions of any shop drawings, product data or samples, the
Trade Contractors shall make any corrections or changes noted on
previous submittals and resubmit as specified for the initial
submittal. The Trade Contractor shall be responsible for the delays
and costs caused by rejection of submittals due to incorrect shop
drawings, samples and manufacturer's data.
7.5. Samples submitted by the Trade Contractor shall be of sufficient size
to illustrate the functional characteristics of their products, with
integrally related parts and attachment devices, and the full range of
colors, textures, and patterns.
7.6. The Trade Contractor is responsible for seeing that "Approved" copies
of shop drawings bearing the approval of the Architect/Engineer and
Owner's Consultants are on the job and being implemented in the field.
7.7. Where information from one Trade Contractor is required by another
before drawings can be made, such as opening locations, etc., that
information shall be requested from Turner and/or provided in
sufficient time to cause no delay.
7.8. Any notations or markings on shop drawings made by the
Architect/Engineer, which Trade Contractor considers a change shall be
immediately brought to the attention of Turner and processed as
outlined in the General Conditions. Fabrication or installation prior
to such notification shall be at this Trade Contractor's risk.
7.9. Any deviation from contract Documents must be clearly noted on all
submissions and transmittals requesting specific approval. The
Architect/Engineer's review of submissions as a whole without such
notation shall not constitute approval of any deviation. Any costs
(including those from Turner, other Trade Contractors, engineers,
architect, or consultants) arising from a deviation shall be the sole
responsibility of this Trade Contractor.
8. CHANGES
8.1. Within 5 days of a request for proposed changes in the work, the Trade
Contractor shall submit an itemized detailed listing of quantities
with the applicable unit cost and extended price for each. All unit
prices and labor rates are to be approved by Turner prior to the
submission of the first change estimate.
8.2. As a minimum, the detailed breakdown shall include the following:
8.2.1. Actual labor costs, itemized by each trade involved, showing
the hourly rate for each. Labor rates shall be the same for
extra and credit computations.
8.2.2. Burden on Labor, which shall be calculated to reflect the
actual costs of mandatory fringe benefits, taxes on labor,
workman's compensation, insurance on labor as affected by
payroll, unemployment taxes, including FICA and FUI.
8.2.3. Actual quantities of material and equipment, with their actual
unit costs. Provide vendor quotes for all material and
equipment not having established unit prices.
8.2.4. The cost of subcontracted work, computed in the same way as
provided under this Subparagraph. Provide Trade Contractor
backup.
8.2.5. Overhead and profit as described in the General Conditions.
<PAGE> 99
ATTACHMENT "C"
MARCH 19, 1997 SWISS RE AMERICA
NORTH CASTLE, NY
8.2.6. Sales tax or use tax on materials, if applicable.
8.2.7. Bond Premium, if bonded.
8.3 All backcharges against the Trade Contractor will carry a 20% Owner
management charge, except for cleaning backcharges which will have a
25% charge.
8.4 Costs for labor shall be in accordance with rates published by the
Building Trade Employer's Association with an allowance for applicable
insurance, overhead and profit.
8.5 Material costs shall be at the actual cost to the Trade Contractor, or
Trade Contractors, including discounts and rebates. Upon request, the
Trade Contractor (or Sub-Trade Contractor) shall submit evidence to
substantiate the costs. Material shall be quoted at trade discount
prices, with quantity discounts also applied where the quantities
warrant. In any proposal with material credits, the credit shall be
based on the actual Contract cost of the material (including trade and
quantity discounts) less any charges actually incurred for handling or
returning a material which has been delivered or for engineering,
fabrication or storage charges. Otherwise, no "cancellation" charge
will be allowed when material has not been shipped.
8.6 The percentages allowed for overhead profit or commission shall be
deemed to include: (1) field and office supervision and
administration, (2) use of small tools; (3) shop burden; (4)
engineering and estimating costs; (5) performance bonds, (6)
supervision above foreman level (7) timekeepers and accountants' wages
and expenses; (8) clerical and general office wages and expenses, (9)
bonuses or above scale wages, (10) personnel expenses and travel
allowances.
8.7 For changes involving both extra and credit amounts, the overhead and
profit shall be applied only to net difference of labor and materials
where the extra exceeds the credit.
8.8 All requests for pricing must be submitted within 5 calendar days.
Turner reserves the right to estimate changes on this Trade
Contractor's behalf and submit to the Owner for approval should
pricing not be submitted within 5 days, at which time this Trade
Contractor will be bound by this pricing.
8.9 All unit prices, unless otherwise noted, are to include all incidental
work normally required in connection with the particular type of work
involved and would include, but not necessarily be limited to:
8.9.1. All engineering including detailing and shop drawings.
8.9.2. All material costs including an allowance for waste are
included in unit prices.
8.9.3. Providing all necessary accessories.
8.9.4. All fabrications and shop costs.
8.9.5. All shop and field labor including supervision and
engineering layout costs.
8.9.6. All temporary utilities required including safety
precautions.
8.9.7. All costs of standby trades during or beyond normal working
hours.
8.9.8. All transportation, freight, insurance, taxes, overhead and
profit, and bonding costs.
8.9.9. All safety requirements.
9. PROJECT MEETINGS
9.1 Each Trade Contractor shall have responsible representation at weekly
coordination meetings held at Turner's job office. These meetings will
be held for the benefit of all trades by coordinating daily activities
of Trade Contractors and Turner. Trade Contractors failing to attend
such meetings shall be held responsible for delays and/or expenses
incurred due to coordination difficulties. Attendance shall be
mandatory for all parties
Project No. 9654 Issue March 7, 1997
<PAGE> 100
ATTACHMENT "C"
MARCH 19, 1997 SWISS RE AMERICA
NORTH CASTLE, NY
notified to attend. The representatives shall be qualified and
authorized to act on behalf of the entity each represented on all
matters discussed.
9.2. Coordination meetings with Turner's project staff will be required
sufficiently prior to the scheduled start of work so as not to
delay the work of this Trade Contractor or other Trade Contractors.
10. RECORD DOCUMENTS
10.1. Record drawings shall be legibly marked to record actual
construction: horizontal and vertical locations of underground
utilities and appurtenances referenced to permanent surface
improvements; location of internal utilities and appurtenances
concealed in the construction referenced to visible and accessible
features of the structure; field changes of dimensions and details;
changes made by Change Order; details not on original Contract
Drawings. All changes, revisions and additions made in the
installation of the work which differ from that required by the
Drawings must be noted.
10.2. At contract close-out, the Trade Contractor shall deliver the
Record Documents to the Owner accompanied by a transmittal letter,
in duplicate, containing the Project title, the Trade Contractor's
name and address, title and number of each record Document
certification that each Document is complete and accurate and the
signature of the Trade Contractor or his authorized representative.
10.3. In additional to the CADD discs required by the General Conditions
the Trade Contractor shall submit one (1) mylar and four (4)
blueline prints of all as-built drawings. The drawings shall be
clearly marked as-built.
11. OPERATIONS AND MAINTENANCE DATA
11.1. Prior to final inspection and acceptance, the Trade Contractor
shall fully instruct the Owner's designated operating and
maintenance personnel about all products, equipment and systems.
The instruction time shall be sufficient to instruct all shifts of
the Owner's operating and maintenance personnel. The Operations and
Maintenance Manuals shall constitute the basis of instruction.
12. HOISTING/SCAFFOLDING
12.1. Each Trade Contractor will be responsible for the hoisting of his
own material and equipment and all required scaffolding and staging
for its work.
12.2. An area of exterior wall will be left off the building to allow
stocking of the building. Any perimeter protection that is taken
down to allow for hoisting by this Trade Contractor shall be
immediately replaced, including times when the area is unattended
(i.e. coffee break). FAILURE TO DO SO WILL RESULT IN A $1,000 DOLLAR
FINE FOR EACH INFRACTION CHARGEABLE TO THE TRADE CONTRACTOR.
13. CLEAN-UP
13.1. All Trade Contractors and their subordinates shall be required to
provide for the cleaning of their own debris to a central location
on a daily basis. Trade Contractors shall daily dispose of their
rubbish, debris, cartons, crates, excess and waste materials etc.,
leaving work area "broom clean". Such central location shall be
defined as a dirt chute or a roll-off container located on premises
in accordance with Site Logistics Plan. Turner will provide
"buggies" in sufficient quantities on each floor to facilitate
cleaning operations. Trade Contractor shall be responsible for
emptying full buggies and returning empty buggies to floor
immediately after emptying. Trade Contractor shall include hoisting
for its cleaning operation in accordance with the requirements
defined elsewhere in these Special Provisions.
13.2. Should clean-up work not be performed within any 24 hour period,
Turner, upon verbal or written notification, shall cause work to be
performed by others. The cost of the work will be backcharged to
the Trade Contractor at cost plus a 25% management charge. Should
additional cleaning be required due to Trade Contractor's
collective failure to provide for its own clean-up as described
herein, Turner shall perform such clean-up as required to maintain a
safe and orderly jobsite. Costs shall be distributed on a pro-rata
basis to
<PAGE> 101
ATTACHMENT "C"
MARCH 19, 1997 SWISS RE AMERICA
NORTH CASTLE, NY
Trade Contractors working in area. This provision applies to
building, site and shanty area.
13.3 Turner's sole responsibility for cleaning shall be limited to
providing dirt chute, containers, "buggies" and "broom" cleaning of
dust and dirt not attributable to a specific Trade Contractor's
operation. In addition, Turner shall engage the services of a
cleaning contractor to provide pre-occupancy final cleaning such as
polishing, vacuuming etc. These services are in no way intended to
limit the Trade Contractor's responsibility for cleaning.
13.4 Trade Contractors are responsible for cleaning up any spillage, or
overspray, or other rapid accumulation of debris immediately if a
safety hazard is created, or as otherwise directed by Turner.
13.5 The Trade Contractor will repair, restore, and clean or bear the
expense of same, for damage or soiling to the work and property of
others caused by the Trade Contractor.
13.6 Burning of refuse on the site will not be permitted.
13.7 Waste material and rubbish shall not be thrown from upper levels to
lower levels or to the ground.
13.8 Turner and the Owner are committed to minimizing the impact of this
project on the environment. Trade Contractor shall use its best
efforts to recycle materials where practical and shall comply with
carting contractor's and Turner's requests for separating debris at
jobsite. It is not the intent of this provision to place unreasonable
financial burden on the Trade Contractor in recycling of materials.
13.9 The above provisions shall apply to adjoining properties and public
streets.
14. INSTALLATION OF ITEMS FURNISHED BY OTHERS
14.1 Where material is specified to be furnished by others or furnish and
delivered only, the Trade Contractor installing the material shall be
responsible for scheduling the delivery, receiving, unloading,
storing, handling, relocating, protecting, hoisting, distributing,
layout and installing the same.
15. PROJECT SAFETY AND SECURITY
15.1 TCCo. has established programs for Safety and Fire Prevention that
shall be implemented on this project. This program [dated 1/24/97] is
hereby incorporated into these special provisions. Every Trade
Contractor shall be required to conform and cooperate with this
program. Safety meetings will be held regularly and each Trade
Contractor must be represented by their general Foreman or above. The
Trade Contractor is responsible for payment of any fines or penalties
resulting from their operations.
15.2 THE TRADE CONTRACTOR'S WORKERS WILL BE STOPPED FROM WORKING IN ANY
AREA THAT AN UNSAFE CONDITION IS OBSERVED. ANY WORKER REFUSING TO
STOP WORKING OR TO CORRECT UNSAFE CONDITION WILL BE DISMISSED FROM
PROJECT PERMANENTLY. IT IS THE TRADE CONTRACTORS RESPONSIBILITY TO
PROVIDE SAFE WORKING CONDITIONS, EQUIPMENT AND PROPER SUPERVISION FOR
ITS EMPLOYEES.
15.3 Turner reserves the right to have all hoisting equipment periodically
inspected by an independent inspector whose findings will be binding.
Corrections must be made within three days of receiving a written
report. Turner will not assume any responsibility for the safe
operation of the cranes by exercising this right. The structural
steel and curtainwall Trade Contractor(s) shall cooperate with the
inspector by allowing time for inspection. The Trade Contractor will
be notified 24 hours prior to the permits, and to have all hoisting
equipment inspected as required by City, State and Federal,
regulations or agencies having jurisdiction. Copies of all inspection
reports and crane certifications must be transmitted to Turner upon
receipt from the agency.
<PAGE> 102
ATTACHMENT "C"
MARCH 19, 1997 SWISS RE AMERICA
NORTH CASTLE, NY
15.4. All safety equipment including hard hats and other protective gear
required to perform the work of the Trade Contractor is to be
supplied by the Trade Contractor.
15.5. Any costs to Turner for Federal, City or State fines or penalties
resulting from the Trade Contractor's operations will be
backcharged to the Trade Contractor.
15.6. All flagmen required for deliveries and erection to the site are to
be furnished by the Trade Contractor.
15.7. Safety protection at the perimeter of the building and open shafts
will be furnished and installed by others unless specifically
included in this subcontract. Trade Contractors are responsible to
remove and replace safety protection as required. During
discontinuous or intermittent work operations, safety protection is
to be replaced immediately. Replacement cost of any protection or
safety devices removed by the Trade Contractor is to be borne by
the Trade Contractor.
15.8. The Trade Contractor is to provide its own protection in shafts as
required by Trade Contractor's operations. Trade Contractor shall
repair and restore any protection which is damaged or disturbed by
it's work.
15.9. The Trade Contractor shall be responsible for any loss or damage to
his property or operations [to the extent that it is not covered
by insurance provided by the Owner]. The Trade Contractor will also
maintain every reasonable precaution to prevent damage to the work
of other Trade Contractors during the course of construction;
damage to the work of the other Trade Contractors will be
backcharged to the offending party.
15.10. A list of key personnel, with addresses and home telephone numbers
for emergency purposes shall be given to Turner. This Trade
Contractor is to appoint a designated project safety person and
inform Turner of this person.
15.11. In accordance with the provision of the HAZARD COMMUNICATION
STANDARD 29 CFR-1926. Material Safety Data Sheets for any
chemical/substance along with any additional information, safety
data or supplemental material safety data sheets available now or
in the future are required to be submitted to Turner with the
submittals for approval.
15.12. Fire Protection will be the responsibility of everyone on site. Any
Contractor performing cutting, grinding, burning, welding, or other
heat, spark, or flame generating type of work will also provide
adequate number of portable ABC extinguishers in the vicinity of
the work. A fire watch must be performed during the activity and
for a minimum of one hour after completion.
15.13. This Trade Contractor shall perform the work in the safest possible
manner and provide erection of and maintain in safe condition all
bridges, stairs, sheds, fences, barricades, chutes, catch
platforms, and all other safeguards required by any and all laws,
codes, ordinances, rules, regulations, and requirements of public
authorities, and take all other measures necessary or proper to
protect human life and property. All such safeguards shall in all
respects be satisfactory to Turner and comply with all legal
requirements. This Trade Contractor shall, if required by Turner,
leave any such bridges, sheds, fences, and other safeguards in
place for Turner's use until directed by Turner to remove the same
and shall thereupon promptly comply with such direction.
16. QUALITY CONTROL
16.1. The Trade Contractor will be required to provide all mock-ups
prior to the start of any work that is essential to the external or internal
appearance or function of the building as directed by Turner and the Architect.
The mock-up work will be performed in advance of its normal operations and the
Trade Contractor shall be responsible for expediting such delivery as required.
16.2. The Trade Contractor is to promptly rectify any deficiencies that
are noted in Turner's or the Architect's field inspection reports.
The Trade Contractor's failure to promptly perform the subject
work, authorizes Turner without further notice to perform the
remedial work at the Trade Contractors expense plus 20% management
charge.
17. TRADE CONTRACTOR REQUIREMENTS
<PAGE> 103
ATTACHMENT "C"
MARCH 19, 1997 SWISS RE AMERICA
NORTH CASTLE, NY
17.1. The Trade Contractor shall notify the Owner of all sub-Trade
Contractor awards after prior approval has been granted.
17.2. By an appropriate agreement, written where legally required for
validity, the Trade Contractor shall require each sub-Trade
Contractor, to the extent of the work to be performed by the
sub-Trade Contractor, to be bound to the Trade Contractor by the
terms of the Contract, Documents, and to assume toward the Trade
Contractor all the obligations, responsibilities (waivers, rights,
remedies, etc.) which the Trade Contractor, by these Contract
Documents, assumes or waives toward the Owner. Where appropriate,
the Trade Contractor shall require each sub-Trade Contractor to
enter into similar agreements with lower tier sub-Trade Contractors.
The Trade Contractor shall make available to each proposed sub-Trade
Contractor documents to which the sub-Trade Contractor will be bound
by this paragraph, and identify to the sub-Trade Contractor any
terms and conditions of the proposed subcontract which may be at
variance with the Contract Documents. Each sub-Trade Contractor
shall similarly make copies of such Contract Documents available to
their lower tier sub-Trade Contractor.
17.3. The Owner will issue to the Trade Contractor one (1) set of prints
of the Contract Drawings and one (1) set of specifications related
to his work at the start of his contract and the same number of any
revised Documents during the performance of this contract which may
affect the scope of his work. The Trade Contractor shall be
responsible for reproducing prints and specifications for his own
use, or for his suppliers' use.
17.4. Except for tests, testing and inspections performed by a testing
Engineer in the employ of the Owner, the Trade Contractor shall be
responsible for the execution of all tests, testing and inspections
required by the specifications and by all governmental authorities
having jurisdiction, and shall pay the costs of all such tests,
testing and inspection. The Trade Contractors shall submit certified
results of the tests and inspections to Turner for the Architect's
approval. The frequency of the tests shall be such as not to delay
the work of following trades. TRADE CONTRACTOR SHALL INCLUDE COST OF
OVERTIME TESTING IF REQUIRED TO MAINTAIN THE SCHEDULE OR TO NOT
INTERFERE WITH THE PROGRESS OF THE WORK OF THE OTHER TRADES.
The Trade Contractor shall not cover any Work (a) before inspection
or testing, (b) before acceptance of such Work by the owner, (c)
contrary to applicable legal requirements or good construction
practice, (d) in violation of the Contract Documents or (e) contrary
to a timely request by the Owner, the Construction Manager or a
Design Consultant.
Trade Contractor shall cooperate fully with the personnel of the
Owner's testing agency and the Trade Contractor shall provide at no
additional cost to Owner, manpower, shop drawings, facilities,
scaffolds, properly calibrated equipment, etc. to reasonably assist
the testing agency personnel in their execution of their testing
and inspection. It shall be responsibility of Trade Contractor to
notify the testing agency prior to commencement of the Trade
Contractor's work. Trade Contractor shall not perform any work
unless such testing agency personnel are present.
It shall be the responsibility of Trade Contractor to notify the
testing agency in sufficient time to allow for travel arrangements
prior to commencement of Trade Contractor's work. Costs incurred for
inspections for rejected materials or un-approved installations will
be by Trade Contractor.
17.5. Within twenty (20) working days of the contract award, Trade
Contractor shall submit and have approved by Turner a complete list
of Foremen, Journeymen and Apprentice wage rates for straight and
overtime work for each trade for all Trade Contractor and Trade
Contractor labor to be utilized on the project. Once approved,
these rates will be the basis for pricing the labor cost of any and
all changes, including time and material changes. No payment for
change work will be made if approved rates have not been provided by
the Trade Contractor. These wage rates shall be in accordance with
the latest addition of the "Building Trade Employers Association
Summary of Trade Agreement and Wage Rates." Any bonuses, travel
expenses, travel time etc. not identified in the published rates
will not be reimbursed to the Trade Contractor or any way paid by
Turner or the Owner; such costs are considered as being included in
the Trade Contractor's percentage profit.
<PAGE> 104
ATTACHMENT "C"
MARCH 19, 1997 SWISS RE AMERICA
NORTH CASTLE, NY
17.6. Turner may periodically issue a list of current contract Documents.
Each Trade Contractor will be responsible to INSURE THAT HIS
PERSONNEL ARE WORKING FROM THE MOST CURRENT DOCUMENTS.
18. EQUAL EMPLOYMENT OPPORTUNITY
18.1. The Trade Contractor shall comply with all laws and regulations
regarding employment discrimination. No one shall discriminate
against any employee or applicant for employment because of race,
religion, sex, or national origin. The Trade Contractor shall
comply with HHS-514 as amended, titled "HHS Requirements for
Federally Assisted Construction Contracts Regarding Labor Standards
and Equal Opportunity Employment".
18.2. Sexual Harassment: Turner Construction Company has always stressed a
discriminating free working environment and has stated policy on
sexual harassment which prohibits any form of sexual harassment by
employees and non-employees on our job sites. All Trade
Contractors, suppliers and/or vendors are required to comply with
this policy and any and all other requirements of the New York
Employment Practices Act.
19. TEMPORARY CONSTRUCTION SERVICES AND PROCEDURES
19.1. All rigging for this work will be performed by the Trade Contractor
requiring same.
19.2. The full costs of standby or temporary services resulting from any
Trade Contractor working overtime or on weekends or holidays at his
election or to ensure completion of his subcontract obligation to
meet job progress shall be borne by the Trade Contractor. These
costs include but are not limited to power, water, sanitation,
heat, winter weather be added to such costs.
19.3. At the start of the project, an engineering survey will be provided
by The Owner consisting of building layout. The Owner will also
establish a bench mark on the first floor. All Trade Contractors
will be responsible for all subsequent layout, from these base
lines and grades. All Trade Contractors will be required to
coordinate their installation with this Control layout. No
surveying of any nature whatsoever will be provided by The Owner.
This Trade Contractor shall provide their own base line layout as
well as all interior partition layout, and to advise The Owner
immediately upon completing this layout of any coordination problems
with their work.
19.4 Any damages caused by carelessness or improper use of the temporary
utility connections by the Trade Contractor shall be rectified at
its cost.
19.5. Temporary electric light and power - as provided for in the
Temporary Electric Specifications. All equipment connections
including all conduit and wire from panel shall be at the Trade
Contractor's cost. Any costs associated with the use of the above
services beyond normal working hours or at lunch time, overtime,
weekends, and holidays will be borne by the Trade Contractor. A
15% management charge will be added to such costs.
19.6. Temporary water and toilets provided for in the Temporary Plumbing
Specification. Trade Contractors personnel shall not utilize toilet
facilities in other occupied areas of buildings. Trade Contractors
shall provide drinking water for their employees.
19.7. The Trade Contractor may furnish, install and remove at their cost
fireproof field offices, shanties, tool sheds, including power,
lights, water, telephone, etc. Location, size general arrangement
and appearance of Trade Contractor's items of plant, tools mixers,
cutters, etc., must be approved by the Owner before setting up at
the site. Construction details shall be subject to the approval of
the Owner and shall contain adequate fire protection and
equipment, conforming with applicable codes. Should any of the
above obstruct the progress of any portion of the work, they shall
be moved by the Trade Contractor without reimbursement of cost,
from place to place or from the premises, as The Owner may direct.
19.8. The cost of heating or cooling of these temporary structures shall
be the responsibility of each Trade Contractor, and installed in a
manner that meets all municipal code
<PAGE> 105
ATTACHMENT "C"
MARCH 19, 1997 SWISS RE AMERICA
NORTH CASTLE, NY
requirements. Electric service requirements will be directly
coordinated with and directly paid to the Electrical Trade
Contractor by this Trade Contractor.
19.9. Any work which may affect the fire protection and fire alarm
systems, either in the Building or the Garage, shall be planned,
coordinated, and approved in advance by The Owner and the Trade
Contractors. This includes dust generating work affecting smoke
detectors, ceiling tile removals where smoke/heat detectors or
sprinkler heads are mounted at the ceiling, and the shutdown of
sprinkler or fire alarm systems. Any work done to or affecting
an active fire alarm system shall be performed on overtime.
19.10. Heating and Cooling - No provisions for heating, cooling or
ventilation are being provided in the early stages of
construction. Safe and adequate measures must be provided by the
Trade Contractors who need heating, cooling or ventilation, to
comply with applicable building codes, manufacturer's limitations
and worker safety and health.
19.11. For equipment driven by gas or diesel engines, provide devices
for exhaust fumes and silencing equipment to ensure a safe
working environment, including providing fire protection for
same. Trade Contractor shall comply with all federal and local
laws or guidelines regarding noise control. Mufflers, whispered
compressors, etc., shall be used throughout Trade Contractor's
work, if required. No fossil fuel burning equipment shall be
used within the interior spaces of the building.
19.12. Snow will be removed to provide access to the site. It will be
the Trade Contractor's responsibility to remove the snow from
their own equipment, material and in the area they are working
including metal deck and sitework. No salt or calcium chloride
will be used in snow or ice removal.
20. MANAGEMENT OF THE WORK
20.1. By 9:30 a.m. of each working day, submit to the Turner Project
Superintendent the following information:
20.1.1. The number of employees working at the site broken down
to indicate classification, i.e., foremen, journeymen,
apprentices, etc., including Trade Contractor's and a
count of minority, female and local employees.
20.1.2. Brief description of the work and where it is being
performed, including quantities of material to be
placed, i.e. tonnage and number of pieces of steel in
place, list of major equipment, etc.
20.2. Dust and fume control is essential to the reduction of health
risks to the surrounding personnel and public. The following
and other methods of dust control shall be provided by Trade
Contractor for its operations:
20.2.1. Adequate ventilation, including provision of temporary
ventilation when necessary, and as directed by Turner.
20.2.2. Wetting down.
20.2.3. Keeping bags of insulating materials, cement, etc.
closed.
20.2.4. Controlled mixing of these materials under field
conditions.
20.2.5. Special attention should be given to the removal of old
insulation, sawing of insulation and certain acoustical
materials.
20.2.6. Job housekeeping must be maintained.
20.2.7. Making all personnel conscious of the problem - both
Supervisors and workmen.
20.2.8. Washing of all vehicles leaving site before entering
public highways.
20.3. Final cleaning of this Trade Contractor's work and subsequent
protection of same is the responsibility of the Trade Contractor.
20.4. The Trade Contractor shall employ a competent full time
superintendent and necessary assistants who shall be in
attendance at the Project site during the progress of the work,
and shall carry a walkie-talkie type radio programmed to the same
frequency used by
<PAGE> 106
ATTACHMENT "C"
MARCH 19, 1997 SWISS RE AMERICA
NORTH CASTLE, NY
Turner. The superintendent shall represent the Trade Contractor
and all communications given to the superintendent shall be as
binding as if given to the Trade Contractor. Important
communications shall be so confirmed on written request in each
case. The superintendent (and any replacement superintendent)
shall be acceptable to Turner.
20.5. The Trade Contractor shall confine operations on the Premises to
areas designated by Turner and permitted by law, ordinances,
permits and the Contract Documents, and shall not unreasonably
encumber the premises with any materials or equipment. The Trade
Contractor shall coordinate all of his operations with, and
secure approval from Turner before using any portion of the
Premises.
20.6. Trade Contractor shall provide personnel who shall be available
on a 24 hr basis for handling emergencies. Trade Contractor
shall furnish 24 hr emergency phone numbers for this person plus
two alternates.
21. PROJECT CLOSEOUT
21.1. Turner will utilize the philosophy of "Project close-out begins
with job start-up." The following close-out procedure shall be
followed:
21.2. This Trade Contractor shall forward all warranties and
guarantees as applicable to Turner within one month following
substantial completion, or one month after your scope of work is
95% complete, or be subject to a $1,000 deduct change order per
week and delay in final payment.
21.3. A minimum of ten (10) copies of operating and maintenance
manuals will be turned over to the Owner. In addition mylar
reproducible as-built drawings, and fill-in "Data on Equipment
Furnished" and "Technical Data Record" sheets will be prepared
by the Trade Contractor and turned over to the Owner. The Trade
Contractor shall forward operating & maintenance manuals per the
following schedule:
21.31.1. Six (6) months prior to substantial completion provide
a single copy of all O & M manuals for Owner, Turner
and Architect review.
21.3.2. Three (3) months prior to substantial completion
provide final copies of the O & M manuals.
21.3.3. As-built drawings must be submitted to Turner one month
prior to substantial completion.
21.4. If items .1, .2, and .3 above are not met, this Trade Contractor
is subject to a $1,000 deduct change per week and a delay in
final payment.
21.5. Trade Contractor will be required to execute Turner's Completion
and Warranty Certificate form, and the Architect's form.
21.6. This Trade Contractor shall complete all punchlist work within
three (3) weeks after substantial completion or be subject to a
$1,000 deduct change order per day and delay in final payment.
<PAGE> 107
ATTACHMENT "D"
MAP
LEVEL 2
CURTAINWALL ERECTION SEQUENCE
START AT FRONT OF BUILDING AT COLUMN 13 AND PROCEED CLOCKWISE
<PAGE> 108
ATTACHMENT "D"
MAP
PHASE 5 MONTH 3.5-4.5
o COMPLETE BUILDING EXCAVATION
o COMPLETE MAIN ROAD ELECTRICAL SERVICE TO ROUTE 120
o TOPSOIL & SEED ON MAIN ROAD & SERVICE ROAD TO ROUTE 120
o SET-UP ENVIRONMENTAL CONTROL AT GARAGE
o CLEAR & GRUB & STRIP TOPSOIL AT GARAGE
o BEGIN EXCAVATION & STOCKPILE AT GARAGE
o CONTINUE SITE UTILITIES, START ON WATER LINE
<PAGE> 109
ATTACHMENT "D"
MAP
PHASE 6 MONTHS 4.5-6
o COMPLETE GARAGE EXCAVATION
o COMPLETE STOCKPILE
o COMPLETE UTILITIES
o COMPLETE WATER LINE
o CONTINUE BUILDING FOUNDATION
o BEGIN GARAGE FOUNDATION
<PAGE> 110
ATTACHMENT "D"
MAP
PHASE 7 MONTH 6-12
o BUILDING SUBSTANTIALLY ENCLOSED
o GARAGE STRUCTURE COMPLETE
o BUILDING & GARAGE FILLS
o SPREAD BUILDING & GARAGE TOPSOIL
o BEGIN LANDSCAPING
o REMOVE CONSTRUCTION PARKING LOT
o REMOVE STOCKPILES & TOPSOIL
o REMOVE SEDIMENT TRAP #3
o REMOVE ROCK CRUSHER
<PAGE> 111
ATTACHMENT "D"
MAP
PHASE 8 MONTH 12-20
o REMOVE ALL SEDIMENTS TRAPS
o CLEAN BASINS
o FINISH LANDSCAPE
o REMOVE CONSTRUCTION PARKING LOT
o BUILDING COMPLETE
o DEMOLITION OF BUILDING
o REMOVE CONSTRUCTION STAGING
<PAGE> 112
ATTACHMENT "E"
SWISS RE AMERICA U.S. HEADQUARTERS TURNER CONTRACT #6123M
NORTH CASTLE, NY MARCH 19, 1997
SPECIFICATIONS FOR TEMPORARY LIGHT & POWER
FOR CONSTRUCTION PURPOSES
1. CODE REQUIREMENTS
The electrical work for construction purposes shall conform to all
Federal, State and Municipal requirements and must comply with the
National Electrical Code and the Occupational Safety and Health Standards
of the Occupational Safety and Health Act of 1970. This contractor shall
obtain and pay for any required applications, permits and inspections
pertaining to this work.
2. GENERAL
Temporary work shall be installed in such a manner so as not to interfere
with the permanent construction. If such interference does occur, it will
be the responsibility of this subcontractor to make such changes as may be
required to overcome the interference. The cost of these changes are
included as part of the subcontract price.
Local power centers shall be constantly maintained to prevent the
accumulation of "rat's nest circuitry". All temporary wiring shall be
suspended and maintained at least eight feet above finished floors and
pass through permanent walls and partitions above the permanent ceiling
level. No open conductor wiring is acceptable.
It is anticipated that the electrical subcontractor will make temporary
use of the telephone risers when installing the temporary lighting and
power system.
3. MATERIAL REQUIREMENTS
As the life of this installation is limited and as this installation will
not form a part of the finished building, minimum cost is the basic
requirement consistent with material and workmanship which will
satisfactorily meet job conditions and regulations of all governing
authorities.
4. MAINTENANCE
All temporary facilities are to be maintained and kept in good operating
condition. Maintenance men necessary to perform this work shall be
provided so that other trades are not delayed.
The Electrical Subcontractor shall be responsible for installing and
maintaining a reasonably balanced system and shall take current readings
on the feeders at regular intervals as required by Turner. Temporary
wiring is to be laid out, balanced and wire sized so as to produce a
voltage drop of no greater than 5% at the extreme end of the line when
operating at full load.
5. TRANSFER TO PERMANENT SERVICE
The permanent power service shall be activated as soon as possible. It is
anticipated that the permanent service will be available approximately
May 1998 to feed the project.
Page 1
<PAGE> 113
ATTACHMENT "E"
SWISS RE AMERICA U.S. HEADQUARTERS TURNER CONTRACT #6123M
NORTH CASTLE, NY MARCH 19, 1997
SPECIFICATIONS FOR TEMPORARY LIGHT & POWER FOR CONSTRUCTION PURPOSES
6. REMOVAL AND SALVAGE
The Electrical Subcontractor shall disassemble and remove from the
property all temporary electrical wiring, lights, equipment, etc. when
its use is no longer required. Surplus material will be salvaged and the
salvage value reflected in the lump sum price.
7. PROTECTION
The Electrical Subcontractor will protect his installation against
weather damage and the normal operations of other trades. This includes
all plywood/watertight enclosures.
8. SCOPE OF WORK
Provide labor, material, equipment and power company fees and costs for
the installation and maintenance of temporary light and power as may be
required during the period of construction (including necessary temporary
transformers). This includes both temporary service and switch-over to
permanent power. Cost of electricity will be by Owner.
A. SERVICE
Con Ed will provide temporary 3-phase, 60 cycle, 13,000 volt
service, via a 500 KVA transformer, (note: this cost by others).
This transformer shall be placed on a temporary precast concrete
pad, along with all associated temporary equipment (distribution
boards, disconnect switches, meters, CT's, etc.). The transformer
will be located on the east end of the building near the loading
dock area (subject to change). The Electrical Subcontractor will
pick up from the Con Ed transformer and equipment and will
distribute electrical service for light and power to all points of
the building, garage, and cooling tower as may be required for
construction purposes, and as hereinafter described. This
subcontractor to coordinate directly with Con Ed in completing this
work to meet their requirements. All temporary enclosures required
shall be provided by this subcontractor. Final switching sizing
will be coordinated by this subcontractor and Con Ed.
This Subcontractor shall include all costs and fees for connecting
site utilities to existing sources, including permits, tap-in fees,
etc. as required by relevant authorities.
B. TEMPORARY LIGHTING
The Electrical Subcontractor shall include all labor and materials
to install and maintain an OSHA approved temporary lighting system
with pigtails and protective shields using 100 watt bulbs.
Temporary wiring will be of a moveable nature suspended from the
structure above in such a manner so as not to do damage to the
spray-on fireproofing when being installed, maintained, relocated,
or removed.
Page 2
<PAGE> 114
ATTACHMENT "E"
SWISS RE AMERICA U.S. HEADQUARTERS TURNER CONTRACT #6123M
NORTH CASTLE, NY MARCH 19, 1997
SPECIFICATIONS FOR TEMPORARY LIGHT & POWER FOR CONSTRUCTION PURPOSES
- --------------------------------------------------------------------------------
MAIN BUILDING
i. Distribution for general lighting will be made from the main
distribution board to temporary lighting panels mounted on movable
stands provided by this contractor located on each floor. Temporary
lighting panels shall be equipped with 15A circuit breakers
for lighting circuits. From these lighting panels, 3 wire No. 12
circuit wiring with "pig tail" lamp holders will distribute light in
accordance with OSHA requirements but at no time shall temporary
lighting be less than 1/4 watt per square foot for the entire floor
area.
ii. All mechanical rooms/areas will require a minimum of 1/2 watt per
S.F.
iii. All stairwells will require a light at each landing and all
intermediate landings.
iv. All entrances and exits of the building will require a single
string of lights with bulbs a minimum of 10 feet on center.
v. Special Requirements:
a. All stairwell, entrance and exit, elevator lobbies, and at
least 10 percent of the mechanical area lighting shall remain
on at all times.
b. All other temporary lighting shall be controlled by appropriate
on/off equipment located at a central location to be determined
by Turner. Turner shall have 24-hour access and control of this
on/off equipment.
c. The replacement of all bulbs and temporary wiring shall be
included as part of these requirements. At least on a weekly
basis, the entire job shall be checked and re-lamped as
required. At no time shall more than 5 percent of the
temporary lighting be not operational.
d. During the masonry, drywall, taping and finish painting
operations, a minimum of one light shall be installed in every
room, using the permanent wiring system. These lights shall
remain operational until the permanent fixtures are
operational. Turner's Superintendent shall determine if
sufficient lighting is being provided for the finish
operations.
e. Provide temporary lights in each elevator hoistway.
f. Provide twelve (12) temporary light stands with two quartz
lights for use by other trades.
g. Provide fifteen (15) 500 watt flood lights of site lighting
purposes as located by Turner.
Page 3
<PAGE> 115
ATTACHMENT "E"
Swiss Re America U.S. Headquarters Turner Contract #6123M
North Castle, NY
March 19, 1997
SPECIFICATIONS FOR TEMPORARY LIGHT & POWER FOR CONSTRUCTION PURPOSES
- --------------------------------------------------------------------------------
GARAGE
f. Distribution for general lighting will be made from the main
distribution board to each floor via the garage's light well.
Temporary lighting panels mounted on movable stands shall be
provided by this contractor as required. Temporary lighting
panels shall be equipped with 15A circuit breakers for lighting
circuits. From these lighting panels, 3 wire No. 12 circuit
wiring with "pig tail" lamp holders will distribute light in
accordance with OSHA.
g. All stairwells will require a light at each landing and all
intermediate landings. Distribute light in the garage lower level
in accordance with OSHA requirements but at no time shall
temporary lighting be less than 1/4 watt per square foot for the
entire floor area. A minimum of one light shall be installed in
every room.
h. All stairwell, entrance and exit "egress path" lighting shall
remain on at all times.
C. POWER
i. Small Tools
Provide 60-amp, 120/208 volt power centers and "pigtails" for small
tools located throughout the project (building, garage, pump house
etc.) so that all floor areas can be covered with standard 50-foot
extension cords. Power circuits shall be connected to OSHA approved 20
amp ground fault breakers.
ii. Welding Machines
Provide 480-volt, 3-phase, 60-amp power for welding at each level in
the building and at one location in the parking garage.
iii. Elevators
Provide power using insofar as possible permanent risers to permanent
elevators for temporary elevator use and elevator construction. This
shall include breakers, wiring, and connections. This Subcontractor
shall also provide, as required, Temporary Electric Service to
traction elevators for adjustment, testing, etc. should permanent
electric service not be available at that time.
This Subcontractor shall provide permanent power to elevators no later
than March 1998. This includes permanent installation of all elevator
recall by facilities and associated elevator machine rooms, complete
in every respect.
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ATTACHMENT "E"
Swiss Re America U.S. Headquarters Turner Contract #6123M
North Castle, NY
March 19, 1997
SPECIFICATIONS FOR TEMPORARY LIGHT & POWER FOR CONSTRUCTION PURPOSES
- --------------------------------------------------------------------------------
iv. Sump Pumps & Booster Pumps
a. Provide power to feed the garage sump pump according to the
requirements of the Temporary Plumbing Specifications.
b. Provide power to feed one booster pump according to the
requirements of the Temporary Plumbing Specifications.
v. Testing Center
The Electrical Subcontractor shall provide and maintain two OSHA
approved ground fault duplex receptacles for use by all trades to test
electrical equipment. Location to be as determined by Turner.
D. COMMUNICATIONS
An emergency alert system complying with OSHA requirements shall be
provided and maintained by this subcontractor. This system shall include as
a minimum, eight (8) 10" speakers on each floor, a master mouthpiece and
amplifier located in a central location to be determined by Turner, one
base station in Turner's field office, telephone handsets and buzzers, as
required.
E. MATERIALS
Furnish all wire and materials necessary to perform the above work,
utilizing permanent systems whenever possible.
When no longer needed, all temporary work will be removed and material
salvaged insofar as possible. Salvage value is to be reflected in the lump
sum price for the temporary work. Temporary job-made wooden enclosures and
panel box stands will be furnished by this subcontractor.
Cost of stepdown transformers, etc. as required for lighting, low voltage
power, etc. is to be included in the lump sum price. The Electrical
Subcontractor shall also include in lump sum price all costs for grounding
to meet all utility and governing authorities' requirements.
EXCLUSIONS:
1.) Subcontractor's Shanties
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ATTACHMENT "F"
SPECIFICATION
for
CURTAIN WALL
Section 08900
[LOGO]
SWISS RE AMERICA
U.S. Headquarters
King Street
North Castle, New York
ADAMSON ASSOCIATES
Architects
------------------
ISSUE DATE
MARCH 7, 1997
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CURTAINWALL
SECTION 08900
PAGE 1
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1.0 GENERAL
1.1 DESCRIPTION
.1 Work of this Section shall conform to the requirements of the
Contract Documents.
.2 Tender Proposals
.1 Submit with tender, proposed drawings based on the design and
performance requirements shown on the drawings and specified
herein.
.2 Provide with tender, name of building recently completed and
previous test results of similar curtain wall system.
1.2 RELATED WORK SPECIFIED ELSEWHERE
.1 Cast-in-Place Concrete Section 03300
.2 Structural Steel Section 05510
.3 Roofing & Sheet Metal Section 07552
.4 Gypsum Board Section 09250
.5 Exterior Building Maintenance Equipment Section 11014
.6 Mechanical Division 15
.7 Electrical (including Security Devices) Division 16
1.3 EXPERIENCE
Execute this work by a firm who has adequate plant, equipment and skilled
workers to perform work expeditiously and is known to have been responsible
for installations similar to that specified during the immediate past five
(5) years.
1.4 WORK INCLUDED
.1 Engineer, submit shop drawings, data and sample materials, test,
fabricate, erect and warrant the curtain wall. The Subcontractor shall
be fully responsible for the structural integrity, weathertightness
(air and watertight to the standards specified) of the curtain wall.
.2 The work shall include, but is not necessarily limited to the
following:
.1 Aluminum mullions, glass, glazing and curtain wall assemblies.
.2 Insulated interior galvanized metal back pan air seal to the
aluminum mullions.
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.3 Catwalk, catwalk hangers, aluminum grating, aluminum monorail for
support of window washing stage.
.5 Operable windows.
.6 Doors.
.7 Aluminum channel in spandrel at catwalk and aluminum reveal at
base of curtainwall.
.8 1/8" sheet aluminum spandrel (note: long lengths).
.9 Fire/smoke stop between concrete floor and curtain wall.
.10 Exterior prefinished copper clad column covers on back-up board.
.11 Exterior prefinished copper clad spandrel covers on back-up
board.
.12 Aluminum panel soffits, framing and suspension.
.13 Provide all fixing plates, brackets, and assemblies required for
complete installation.
.14 Metal flashing, flexible membrane and sealant between curtain
wall and adjacent materials.
.15 Thermafibre insulation to back of curtain wall to provide 1 hour
rating.
.16 Sealing of curtain wall, interior and exterior.
.17 Supply and set out (install) floor anchors for curtain wall.
.18 Mock-ups, samples, shop drawings.
.19 Testing to specified standards.
.20 Maintenance manual.
.21 Installation and removal of protection.
.22 Convector cover.
.23 Spare stock of sealed units.
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.24 Back-up board to inside of curtain wall (to achieve an STC rating
through the spandrel of 40)
1.5 BUILDING REGULATIONS
1. Design of curtain walling shall comply with all Government Codes and
Regulations, Fire Regulations, State of New York Building Code, Safety
Regulations and any other regulations applicable to the installation.
1.6 REFERENCE STANDARDS
.1 The works shall be in accordance with ASTM E283,ASTM E330, ASTM E547,
ASTM E331, ASTM E283, ANSI A58.1, NAA MM Standard TM-1-68T.
1.7 DESIGN REQUIREMENTS
.1 General
.1 The design, fabrication, installation and performance
requirements herein specified are intended to establish minimum
performance and general principles.
.2 The Subcontractor shall be entirely responsible for the curtain
wall installation and associated works, for achieving or
surpassing the design and performance criteria for all components
and assemblies of the installation.
.3 The engineering-design of the work of this section shall be
certified by a Professional Engineer experienced in the design of
curtain wall. Request approval of all deviations or
non-compliance to the project standards.
.4 Architectural drawings are diagrammatic. Details are intended as
a guide for the aesthetic and interfacing requirements of the
curtain wall to and with other work and are not to be construed
as engineering design or adequate to meet the engineering design
requirements. The engineering design of the curtain wall is the
responsibility of this trade. Material types, sizes, and/or
thicknesses shown on the drawings are the minimums acceptable and
shall not be reduced regardless of engineering design.
.5 The Subcontractor is responsible for coordination with the window
washing contractor regarding size, shape, alignment and
tolerances of window washing track.
.2 Climatic Conditions
.1 Minimum exterior air temperature 11 degrees F DB
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Maximum exterior air temperature - Daytime 92 degrees F DB,
74 degrees FWB
.2 Humidity
Varies Summer 50% @ 75 degrees F DB
Winter 30% @ 32 degrees F DB
15% @ 11 degrees F DB
.3 When air conditioning systems is not operating
Minimum interior air temperature 60 degrees F
Maximum interior air temperature 105 degrees F
.3 Thermal Movement
.1 Design all components of the installation to allow for thermal
movement resulting from a surface temperature of exterior metal
surfaces of 170 degrees F.
.2 All components of the installation shall be capable of
withstanding noiselessly all thermal movements, resulting from
specified temperature differential without buckling, distortion,
cracking, failure of joint seals, undue stress on glass and
fixing assemblies or other harmful effects.
.3 Fastening of copper clad spandrel panels to framing shall be
designed to allow movement without visual buckling or distortion.
.4 Thermal Performance Requirements/Vapour Barrier
.1 Thermal Performance
.1 Spandrel shall provide R20 thermal performance.
.2 There shall be no condensation on the interior surfaces
under the design conditions specified. Provide a thermal
break if required to meet this requirement.
.2 Air Seal/Vapour Barrier
.1 The curtain wall shall have a continuous air and vapour
tight layer within the limits specified below, immediately
to the exterior side of all insulation. The air and vapour
tight layer may consist of different materials at different
points in the assemblies, but the joints between these
materials shall continue the integrity of the air and vapour
seal and be non-combustible.
.2 It is the responsibility of this trade to design and provide
the air seal between the curtain wall and adjacent surfaces;
e.g. walls, roof.
.3 Air infiltration and exfiltration of the curtain wall shall
not exceed .03
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cfm/s.f. when subjected to a pressure of 6.24 lbs per s.f.
.5 Structural Building Movement and Tolerances
.1 Dead and Live Loads: the curtain wall system and fixing
shall be designed to accommodate differential structural
movements, deflections, creep, and thermal movement of the
structure, and other elements.
.2 The design of the curtain wall and fixing to structure shall
accommodate building construction tolerances in accordance
with those specified in the AISC (American Institute of
Steel Construction) Code of Standard Practice, and latest
edition (refer to drawing BSK-69 attached) and movements as
outlined below.
.3 The Subcontractor will be responsible for agreeing to all
tolerances with the Contractor.
.4 The curtain wall system shall be designed to accommodate the
horizontal drift and racking of the building due to wind
resulting in a floor to floor offset of L/500. Glass bite
shall not be reduced below 3/8" under deflected condition.
.5 Allow for a differential deflection of spandrel beams after
curtain wall installation of 1/4" maximum (1/2" at base).
.6 The curtain wall system shall be designed so that the
failure of any one element (eg. bolt, anchor, embed) will
not result in progressive failure of the wall.
.6 Structural Performance Requirements
.1 Design curtain wall to resist positive and negative wind
loads of 30 psf. typically and 39 psf within 25' of the
corner.
.2 The cladding system shall be designed to accept 150% of the
design loads without failure or permanent deformation.
.3 Deflection of metal cladding or any framing or coupling
member (mullions) when carrying full design load shall not
deflect more than 1/240 of its clear span, maximum 3/4".
.4 All components, couplings and fixing assemblies shall be
designed and installed in such a manner as to be capable of
accommodating all of the above deflection without
distortion, deformation or failure.
.6 The specified deflection allowable shall be reduced if it is
in any way
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CURTAIN WALL
SECTION 08900
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detrimental to any curtain wall element, sealants and/or
sealant joints, glass and/or glazing, or related components
and adjacent structural or building elements.
.7 Design catwalk system to support loads as shown on attached
drawing BSK-47. Closely co-ordinate design with Exterior
Building Maintenance Equipment Section 11014.
.8 Design convector cover to support a point load of 300 lbs.
.7 Resistance to Water Penetration
.1 There shall be no water penetration to the interior under a
pressure differential from exterior to interior of 10 psf.
.2 All components of the installation shall be gasketted,
baffled, overlapped and sealed as required to provide an
effective 'rain screen' pressure equalized barrier to
prevent rain water entry.
.3 All components outboard of the air seal shall be vented,
drained and pressure equalized to building exterior.
.8 Sound
.1 Curtain wall (windows and spandrel) shall have a Sound
Transmission Coefficient of 40 minimum.
.9 Fire/Smoke Stop and Air Seals and Fire Barrier
.1 Fire/smoke stop assemblies are to be incorporated at floor
levels. Submit for approval all fire/smoke stop assemblies
and fixing method.
.2 Provide 1 hour fire rated spandrel 36" high.
.10 Anchorage and Fixing Supports
.1 All anchorage and supports shall be designed, fabricated and
installed for full compliance with performance criteria
herein specified, including the accommodation of thermal,
wind pressure and other building dynamics, without hazard to
any component or assembly, glass and glazing and related
sealant applications.
.2 The Subcontractor shall be responsible to design and supply
all necessary anchorage and fixing supports for the complete
installation.
.3 Bolts, screws and nuts used for component assemblies and
their fixing to
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structure shall be of adequate strength for their design
purpose. They shall be used in accordance with the
manufacturer's recommendations, and bolts and fixings
failure load will have been substantiated by previous tests.
.4 Details describing the design, materials, location and
installation procedures of all anchorage and fixing supports
shall be fully described in the shop drawings.
.5 Floor anchor cast into concrete floor may be steel, prime
painted. Anchor attachment to mullion shall be non ferrous.
.6 Type and location of all fixings to be submitted to
Structural Engineer for his review with regard to load
applied to building structure.
.11 Opening Windows for Catwalk Access
.1 Opening window fittings must adequately support framework
and glass in operation and in the open position without
distortion or other damage under 50% of the specified wind
load and conform to the safety requirements.
.2 Locking devices incorporated in opening window construction
to be fitted with concealed multi-point locking (2 bolts
minimum) to meet the specified air infiltration
requirements.
.3 Control point to be fitted with a raised handle for
operation. Operation shall not require undue force. Windows
shall be designed to open from exterior as well as interior.
Provide removable handle.
.12 Aluminum Extrusions
.1 Design components to profiles indicated.
.2 Minimum thickness of aluminum extrusions is 3 mm. Reinforce
flange and web thickness as required for adequate rigidity
and strength. Sides of extrusions shall be square and flat.
.3 If required to meet design loads, reinforce aluminum
sections with aluminum structural sections.
.4 Aluminum extrusions shall be free of die marks and comply
with accepted standards for tolerance.
.13 Glass
.1 Glass shall be designed for a failure probability of 8 lites
per thousand under design load.
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.2 Glass shall be heat strengthened as required in order to meet the
wind loads, failure probability specified or to accommodate
thermal stresses and as required to meet building regulations.
.3 Glass within 1'-6" of the floor shall be safety glass.
1.8 CORROSION ANALYSIS
1. Engage an independent engineer who is an expert in corrosion who shall
conduct a component-by-component corrosion analysis of all items being
incorporated into the curtain wall system and provide report to
Architect.
1.9 SUBMITTALS
.1 Shop Drawings
.1 Submit shop drawings to the Architect for consideration before
any work is fabricated.
.2 Shop drawings shall show all plans, elevations, sections material
finishes and colour and full size details of fabrication,
assembly, installation and fixing anchorage, for all curtain
wall, window types and conditions.
.3 Full size details shall show and describe metal and glass gauges
and thicknesses, fire/smoke stops, construction and finishes,
areas to be sealed, types and application of sealants, gaskets,
thermal isolation materials, provisions for thermal movements,
fabrication and erection tolerances, application of vapour
barriers, and bolt torques.
.4 Shop drawings shall be properly identified showing in detail the
design and construction of all parts of the installation and
materials.
.5 Each copy of a shop drawing shall be stamped with the
Subcontactor's name, Professional Engineer's stamp, dated with
the submittal date, and signed by the Subcontractor.
.6 It is the responsibility of the Subcontractor to verify on site
and coordinate all dimensions and modules related to the work.
Shop drawings shall include a complete layout of modular and
referenced dimensions for all curtain wall assemblies.
.7 Final comment on the shop drawings shall be contingent upon the
complete submission of all structural calculations,
documentation, certifications, approvals (anchorage and fire stop
assemblies), samples, mock-up and test report. All samples,
technical material and pre-test results shall be submitted for
review prior to submission of shop drawings.
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.8 The Architect's comments will relate only to general aesthetic
and overall functional matters and not to the detailed design and
construction of components, which shall remain the complete and
sole responsibility of the Subcontractor.
.9 The Architect's consideration of shop drawings shall not relieve
the Subcontractor from his responsibility for errors or for
supplying components and materials to the full satisfaction of
the Architect.
.2 Structural Calculations
.1 Submit to the Architect for record purposes structural
calculations which are to include, but not be limited to
calculations for all curtain wall elements and/or sections,
connections, including anchorage and support fixing assemblies,
etc.
.2 Structural calculations shall be cross-referenced to the
applicable shop drawing details.
.3 Structural calculations shall have the stamp of a Registered
Professional Engineer licensed in the State of New York.
.3 Quality Control
.1 Submit to the Architect for comment with the shop drawings,
quality control procedures, both in the factory and on site, that
will be undertaken by the Subcontractor to ensure the design
integrity and performance of the installed curtain wall and
window assemblies.
.2 Submit to the Architect details of experience and qualifications
of the supervisor who will be employed on site to control the
installation and fixing and glazing operations, his capabilities
to explain methods and materials to ensure that components are
stored and installed in conformance with the Contract Documents.
.4 Glazing
.1 Submit to the Architect a written certification from the glass
and glazing manufacturer that the glass and glazing components of
the curtain wall assemblies have been reviewed and approved as
completely appropriate for their intended use in the system as
shown and detailed on the shop drawings, designating drawing
number, date and requirements of the Contract Documents,
compatibility with all components and adjacent material and
thermal safety of all glass constructions together with life
expectancy of glazing materials detailed and specified in the
glazing system.
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NOTE: The Subcontractor must take account of any stresses
developing from solar radiation or other causes - prior to or
during installation of the glass - and allow for protection or
methods of handling the glass to avoid such stresses and conform
to the Safety Requirements for glass application as set out in
ASTM C1036.
.2 Glazing shall be removed and replaced from the interior. Submit
to the Architect detail drawing indicating procedure for removal
and replacement of any damaged unit of glass.
.5 Sealants
.1 Submit to the Architect a written certification from the sealant
manufacturer that all sealant application in the curtain wall has
been reviewed and approved as completely appropriate for its
intended use in the system as shown and detailed on the shop
drawings, designating drawing number, date and revision, with
regard to all design criteria and all other requirements of the
Contract Documents and compatibility with all components and
adjacent materials together with life expectancy of sealant
materials detailed and specified. Specific reference shall also
be made to the compatibility of the glass edge seal with adjacent
materials.
.6 Maintenance
.1 Before completion of the works, submit four (4) copies of a
Maintenance Manual to include recommendations and procedures for
periodic inspection and maintenance of all components of the
curtain wall and window assemblies and sealants, including
instructions with appropriate drawings on methods to be employed
to replace any component of the installation.
.2 Maintenance Manual to include:
- recommended inspection schedule.
- a copy of each shop drawing in its latest amended form.
- complete explanation of operation principles and sequences.
- complete parts list with numbers and glass sizes.
- method statement of reglazing and replacement of component
parts of the installation.
- instructions for the proper cleaning and routing maintenance
of the facade, including frequency.
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.7 Record "As-Built" Drawings
.1 As the job progresses, clearly mark all changes and
deviations from the shop drawings on a bound set of white
prints.
.2 Keep the prints available at the site for periodic inspection
throughout the duration of the work. Pay particular attention
to accurately dimensioning the exact location of all buried
work and work concealed in inaccessible locations.
.3 When the project is complete and ready for inspection, amend
the shop drawings in accordance with the marked-up prints
mentioned above and provide one set of mylar reproducibles.
.8 Samples
.1 Submit to the Architect samples of the 4-way panel-to-panel
intersections. Mock-up shall be complete with all materials
and sealants to be used on the project. Size of mock-up to be
approximately 2'-0" by 2'-0".
.2 Submit to the Architect a sample of all materials to be used
on the project.
1.10 WARRANTY
.1 Submit a five (5) year warranty covering materials and workmanship
of curtain wall system. Without restricting the generality of the
warranty, definition of defects shall include failure of the
installation to meet the design requirements, leakage, failure of
sealants, failure of laminated glass, delamination, haziness, etc.
Provide a 10 year warranty on seal failure of the sealed doubled
glazed units.
.2 Warrant that curtain wall will remain watertight, weather-tight,
airtight, structurally sound and free from distortion; that
aluminum finishes will not develop excessive fading or
non-uniformity of colour, and will not crack, craze, peel, flake or
otherwise corrode; that glazing materials and sealant will be free
from deterioration from sunlight, weather and oxidation, and will
be free from permanent deformation.
1.11 TESTING
.1 Laboratory Test Unit Assembly - Curtain Wall
.1 As soon as possible after the award of the Subcontract, the
Subcontractor shall construct and have tested full size test
panel assemblies. Refer to attached Appendix for size of test
panels required.
.2 The Subcontractor shall submit drawings with full size
details with actual dimensions and thickness of all component
parts, describing the test unit
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assemblies and test procedures for the Architect's approval.
.3 The test unit will include curtain wall framing members, glass
and aluminum constructions, roofing system, anchorage and fixing
assemblies, sealant application, etc.
.4 Supply, install and glaze full scale mock-up of curtain wall and
roofing system at Construction Research Laboratories, Miami,
Florida, or similar independent testing facility approved by the
Architect and capable of performing the specified tests. At the
conclusion of the testing procedure, be responsible for the
complete dismantling and removal of the mock-up.
.5 Arrange for and attend test.
.6 Cost of testing will be paid by this trade.
.7 Erection crew for the mock-up shall be the same men as for the
project.
.8 Site Superintendent for the project for this trade shall attend
the erection and test of the mock-up.
.9 Should test results indicate non-compliance with the
specifications, provide new curtain wall unit at no cost. Pay
for all costs incurred in retesting, including the cost of
testing. Provide engineering to redesign and correct
deficiencies, rebuild test curtain wall unit and retest until
approved.
.10 Submit test results for all design criteria specified.
2. Test Programme - Curtain Wall
.1 Preload wall to remove slack at 50% of positive pressure design
load.
.2 Static Air Infiltration/Exfiltration
.1 Air infiltration and exfiltration during test shall not
exceed limits specified.
.3 Static Water Penetration Test
.1 There shall be no infiltration of water to the interior face
of the assembly during and/or at conclusion of test.
.4 Dynamic Wind and Rain Test
.1 Perform testing in accordance with AAMA TM-1-76. There
shall be no infiltration of water to the interior face of
the assembly during and/or at conclusion of test.
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.5 Static Structural Performance Test
.1 Testing shall verify:
.1 That the inward deflection on any part of the assembly
shall not be sufficient to cause such member to touch any
part of the main structure or impose loads onto any
non-load bearing exterior wall members.
.2 That all components shall return to their original
positions under zero load, providing that the elastic limit
to the materials has not been exceeded. Residual
displacement of members at the anchors shall not exceed
0.09".
.3 That in all cases, the deflection of members shall not
exceed limits specified.
.4 That anchorage shall not show permanent set nor signs of
slackening off. The deflection of members shall not be
sufficient to damage non-loading bearing member of the
inner wall assembly.
.6 Repeat 2, 3 and 4 above.
.7 Thermal Resistance Test.
.1 Performance three thermal cycling tests in accordance with
specified requirements of AAMA 1502-7-1981.
.2 At least one cycle shall be maintained at the high temperature
for several hours to allow temperatures within the test
assembly to stabilize.
.3 Repeat 1 and 2 above.
The purpose of this test is to ascertain the performance
characteristics of the curtain wall components under the
expected climatic conditions as specified. Of particular
interest is the detailed provision for expansion and contraction
of the metal, fastenings, etc., and the behaviour of sealants.
Any modification to the prescribed testing procedures which will
facilitate a proper understanding of the above will be
considered.
.8 Structural Performance using 150% of Design Load
.1 There shall be no damage or failures when mock-up is subjected to
positive and static pressures of 150% of design load for 10
seconds. Maximum allowable permanent deformation is L/500 of
span.
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.3 On Site Mock-Up
.1 Erect a production prototype, one floors in height by 15'-0"
wide of the system in order to identify and solve any problems
of assembly, erection and interfacing that may be encountered
under site conditions. Resolve problems, correct or remove and
rebuild as directed by the Architect. Prototype will serve as a
standard for subsequent work. Notify the Inspection Company
prior to the assembly and erection of prototype in order that
they can have their representative present during fabrication
and erection.
.4 On Site Test
.1 Prepare a section of curtainwall for testing. An Independent
Inspection Company selected and paid for by the client will test
the wall. Provide water, power and access to exterior wall face.
In the event of failure, affected areas shall be retested until
desired results have been achieved.
.2 There shall be a minimum of three tests.
.3 The test area will be placed under negative pressure and used to
test panel and window joints on site for water and air
penetration.
2.0 PRODUCTS
2.1 MATERIALS
.1 Aluminum Extrusions and Sheet Aluminum: shall be in accordance with
Aluminum Association Design alloy AA 6063T to ASTM B221, anodizing
quality, free from perceptible distortions, waves, twists, buckling
or other deficiencies of appearance or performance.
.2 Prefinished Copper: 110 copper, conforming to ASTM B370, cold rolled
temper, and weighing not less than 16 oz. per sq. ft. for siding and
10 oz. per sq. ft. for lamination to extruded aluminum mullion caps.
Where exposed to view, pre-oxidized to natural patina, EverGreen by
Revere Copper Products Inc., Rome N.Y. or Hussey Copper Ltd. Penn.
.1 Hook strips: 16 oz. colded rolled, cornice temper copper sheet,
conforming to ASTM B370.
.2 Fasteners: Hard grade copper or copper alloy.
.3 Cleats: 2" wide, 16 oz. copper of length to allow sufficient
metal to fold over screws.
.3 Aluminum Finishes
.1 Interior exposed to view:
.1 Typically; Clear natural AA-M12 C22 A31; 0.7 mils minimum
thickness.
<PAGE> 132
.2 Mid rail horizontal of window; Black, 2 coat Duracon by PPG or
approved equal.
.2 Exterior exposed to view:
.1 Typically: Prepatinated copper clad.
.2 Soffit, spandrel channels, sheet spandrel, and aluminum jamb
reveals between copper and concrete walls: Black, 2 coat Duranar
by PPG or approved equal.
.3 Catwalk: mill finish aluminum
.4 Catwalk support angles and window washing monorail: Clear natural
AA-M12 C22 A41; 0.7 mils minimum thickness.
.4 Bolts, Screws and Fastenings:
.1 For aluminum: Exterior to air seal line; Type 300 stainless steel:
interior to air seal line, Type 400 stainless steel.
.2 For Copper. Hard brass or copper alloy.
.5 Bituminous Paint: comply with M1L-P-6883A.
.6 Glass: Factory sealed double glazed unit. Insulating glass units shall be
fabricated using the dual-seal system, consisting of a primary seal of
polyisobutylene specifically manufactured for primary insulating glass
seals and secondary seal of silicone. Units shall be certified by IGCC or
shall be certified by an Independent testing laboratory as complying with
ASTM E 773 and 774. Provide a 10 year warranty on seal failure. Glass shall
be heat treated or tempered to suit codes and wind loads.
.1 Vision Glass: Vision glass shall be 1/4" thick outer light with low E
coating on surface 2 shading coefficient of .43, light transmission of
70%; 1/2" air space; 1/2" inner light composed of two sheets of clear
glass with .030" laminate; STC 40. Viracon Solarscreen 2000 Low E
insulating glass or approved equal; to match appearance of sample in
Project Manager's office.
.2 Translucent Glass: (refer to alternate in tender form) Translucent
glass light diffusing and insulating panels, shall be by Okalux by
Schott Corporation, Yonkers, N.Y. consisting of a 1/4" clear glass
outer lite; three layers of glass fibre tissue, one layer of 1/2"
thick capillary slab, one layer of glass fibre tissue; 3/8" laminated,
clear glass inner lite; to match appearance of sample in Project
Manager's office. Capillary slab to be manufactured in one piece.
Translucent panel shall have a shading coefficient of .42 and an STC
rating of 40 minimum.
.7 Thermafibre Insulation: (refer to separate price in tender form) shall be
Thermafibre Curtain Wall type CW 40, Foil Faced Blankets by United States
Gypsum Company or approved equal. R value 8.0.
<PAGE> 133
.8 Insulation: Semi-rigid fibrous glass; AF 530 by Owens Corning; R20; 5"
thick.
.9 Back Pan/Metal Closure Panel Air Seal: Galvanized metal sheet, as detailed,
22 gauge thick. Reinforcing shall be provided if required for stability of
the sheet.
.10 Insulation Retainer Bars and top hat furring: Utility grade aluminum.
.11 Firestop (Safing Insulation): mineral fibre, 4 pcf density. Safing clamps
12 gauge with clinch shield. ULI label.
.12 Sealant:
.1 Internal: selected by curtain wall manufacturer.
.2 External: Sealant shall be Dow Corning one-part silicone or approved
equal sealant that will cure to a durable watertight flexible silicone
rubber joint seal that can accommodate +/-50% movement for all site
applied sealant. Sealant colour to be as selected by Architect.
.3 Primer: as recommended by manufacturer.
.4 Smoke: 3M Fire Barrier 2003 Silicone Sealant (self levelling).
.13 Paint: Expandite Ltd. "Galvafroid" or approved equal.
.14 Shims, Spacers and Setting Blocks: 40 to 60; 80 to 90 Durometer Shore 'A'
Hardness +/-5 respectively, EPDM neoprene rubber by Goodyear Industrial
Products or approved equal. Resistance to sunlight, weathering, oxidization
and permanent deformation under load and compatibility with all materials
in the glazing system shall be the prime essentials of shims, spacers and
setting blocks.
.15 Glazing Gaskets: black neoprene compression gasket of sufficient thickness
to be under 25% compression minimum when installed. Gaskets shall have
1,500 psi tensile strength, hardness Durometer A of 50 +/-5, resistance to
permanent set, +/-25% minimum elongation at break and resistant to ozone
showing no cracks, premoulded vulcanized comers.
.16 Cleaning Material: Xylol, Isopropyl alcohol, Toluol or recommended by
sealant manufacturer.
.17 Flexible Membrane (at building eave): To be supplied by roofer to this
Section for installation into window extrusion.
.18 Batt Insulation: shall be fibreglass to suit conditions shown.
<PAGE> 134
\ ATTACHMENT "F"
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.19 Compressible Filler: non-staining, round, resilient and non-absorbent
closed cell foam recommended by sealant manufacturer (polyethylene or
chemically compatible rod stock butyl or neoprene). Diameter shall be
25% greater than joint width before installation. Compatible with
sealant, primer substrate. Ensure rod is not cut or broken.
.20 Nailing Strips: S4S pressure fire retardent treated with fire
retardent chemicals and with preservative qualities to resist decay
and termites, non-corrosive to metals, Dricon Fire Retardant Treatment
or approved equal by Hickson Building. Solid stock, mill sawn, Grade 2
or better, fire and water resistant, to ASTM D1037, flame spread 10,
smoke developed 0, fuel contribution 0.
.21 Building Paper: Rosin sized unsaturated building paper, 6 lb. per 100
sq. ft.
.22 Galvanizing: to ASTM A123.
.23 Catwalk: 2" x 3/16" aluminum bars, pressure locked, 1 3/16" x 4"
centers; mill finish.
.24 Window Washing Track: Extruded aluminum channel; clear anodized
finish; AA-M12 C22 A41; 0.7mils minimum thickness.
.25 Hanging Rod and Bolts for Catwalk: Type 304 stainless steel, light
brushed finish No. 4.
.26 Roofing Felt: Roofing felt shall be smooth, unsaturated building paper
weighing approximately 30 lbs per 100 s.f.
.27 Back-Up Board: polymer modified concrete reinforced with fully
embedded alkali resistant fiberglass mesh facing, non-combustible,
smoke developed 0; Flame Spread 0, Fuel contribution 0, Unicode by
Unifix Concrete Boards or approved equal.
.1 For back-up to copper siding; 1/2" thick.
.2 For back-up to galvanized metal back pan (to achieve STC 40
through non-glazing areas); 3/8" thick.
.28 Doors: Insulclad 260 doors by Kawneer or approved equal. Prepatinated
laminated copper finish or aluminum on exterior metal surfaces; clear
anodized finish; AA-M12 CC A41; 0.7mils minimum thickness or interior
metal surfaces.
.1 Top rail 2 1/4"; bottom rail 3 7/8".
.2 Continuous, rigid PVC thermal separator.
.3 Continuous weatherstripping.
.4 Glass: Sealed double glazed; 1/4" thick tempered outer light with
low E coating on surface 2 shading coefficient of .43, light
transmission of 70%, 1/4" clear tempered inner light; Viracon
Solarscreen 2000 Low E insulating glass or approved equal; to
match appearance of sample in Project Manager's office.
.5 Push/Pull.
.1 For doors to 3rd floor Terrace:
Project No. 9654 Issue March 7, 1997
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Classic offset pull and push bar back to back; 15" high pull
on exterior, stainless brushed finish on exterior and
interior; Adams Rite throw bolt; cylinder to be supplied by
Hardware Section.
.2 For door exiting stairwell:
Panic Bar: Von Duprin 98 Series rim device, size 4', #630
stainless steel satin finish on interior, 98E0- Exit only on
exterior.
.3 For doors from Terrace to Office at grid lines 8 and 13:
Classic Push Bar, stainless steel brush finish on exterior,
blank on interior; Electric lock keyed to fire alarm system
by Hardware Section. Coordinate and make allowance for
electric lock, including wiring within door frame.
.6 4 21/32" aluminum threshold (450-055) to suit Insulclad 260 door
with sweep; clear anodized finish; AA-M12 C22 A41; 0.7 mils
minimum thickness.
.7 Overhead concealed closer; LCN 5036, stainless steel finish.
.8 Non-thermally broken aluminum transom header for LCN closer with
door stop; aluminum door jamb and adaptor with thermally broken
door stop. See drawings for sizes, profiles and extent of copper
and aluminum finishes. Prepatinated laminated copper finish on
aluminum on exterior metal surfaces; clear anodized finish, AA-
M12 C22 A41, 0.7 mils minimum on interior metal surfaces.
.9 Stainless steel butt hinges to suit 3'-8" wide doors.
.10 Coordinate all door hardware with security requirements.
2.2 FABRICATION - GENERAL
.1 Curtain wall shall be constructed in shop fabricated units, and shop
glazed and delivered to the site in a panelized form.
.2 Fabricate sections to accommodate and interface with work of other
contracts by means of rabbets, interlocks, miscellaneous angles, trim
and filler sections, as required.
.3 Component fastenings shall be concealed throughout of adequate
strength fabricated from stainless steel and shall be fusion welded.
.4 Reinforce mullions with aluminum sections if required. Secure aluminum
sections with adequate anchors to structure.
.5 Jointing and intersections of metals shall be accurately cut, fitted
to a tolerance of 1/16" in true planes with adequate concealed
fastenings and sealed.
.6 All gaskets forming weather seals and air seals shall be formed into
complete frames with vulcanized corner joints.
.7 All gaskets shall be free from all contact and migration stain and
compatible with all substrates, sealants and finishes with which they
contact.
Project No. 9654 Issue March 7, 1997
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.8 Perform fitting and assembly of component parts in shop; units which
cannot be permanently shop assembled shall be fitted, assembled,
marked and disassembled to assure proper fitting in the field.
Identify field assembly joints on shop drawings.
.9 Fabricate all devices required for erection and adequate anchorage
and attachment, including items required to be built into or
attached to the wall panels or structure for the support of the
work.
.10 Provide inconspicuous, baffled weep holes to properly vent, pressure
equalized and drain system cavities to exterior.
.11 All exposed aluminum surfaces of frame sections, sill and cut-offs
shall have matching finish in colour selected.
.12 Fabricate glazing recess of sufficient depth to cover glass
edge-seal, 3/4" minimum.
.13 Air seal junctions of all horizontal and vertical aluminum members
with joint tape and sealant.
.14 Use two part polysulfide adhesive to bond copper to painted aluminum
extrusions for exterior caps.
.15 Co-ordinate with Security Section. Provide cutouts in frame for
security devices at opening windows and doors including electric
locks at doors. Provide conduit within frame (supplied by Division
16000)
2.3 FABRICATION - OPERABLE UNITS
----------------------------
.1 General
-------
.1 Fabricate and shop assemble frame and sash members into
complete curtain wall system.
.2 No bolts, screws or fastenings shall impair independent frame
movement.
.3 Hardware member bridging thermal break; suitable, high
strength, low conductive, non-metallic material.
.3 Sash
----
.1 Mitre all corners. No exposed fasteners permitted. Air seal
junction of all corners with joint tape and sealant.
.2 Seal frame weather tight.
.3 Joinery methods shall not discolor visible finish. Provide
cutouts,
<PAGE> 137
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reinforcement as required for hardware.
.3 Weatherstripping
.1 Provide two rows of continuous extruded neoprene, replaceable
fin type, sponge neoprene weatherstrip in dovetail grooves along
perimeter of operating sash.
.4 Hinges
.1 Support sash on pins designed to allow installation and removal
of sash without disturbing glass or pivot placement.
.2 Hinges: aluminum, with stainless steel pins and bushings, sized
to support operable sash.
.5 Locks
.1 White bronze, stainless steel, locks, strikes and keepers for
custodial key operation shall secure sash in closed position.
.2 Provide two locks per jamb.
.3 Provide safety custodial keys, removable only when sash is in
closed and locked position, from interior and exterior.
.6 Safety/Restraining Device
.1 Provide a special restraining device of aluminum and/or white
bronze and/or stainless steel to permit sash to open 90 degrees
and prohibit sash from swinging against adjoining building
elements.
2.4 CATWALK
.1 Fabricate catwalk in modules typically of 5'-0" length. Allow
cut-outs in catwalk for installation of safety tie back system.
.2 Weld catwalk grating and window washing monorail to support angle.
.3 Install catwalk level maximum deviation 1/8" in 10'-0". Align window
washing monorail to suit traversing equipment. Provide removable end
blocks to monorail track to prevent traversing equipment from running
out open ends of monorail but allow removal for service. Note: Provide
curved sections of monorail at building corners to suit Section 11014
requirements.
3.0 EXECUTION
Project No. 9654 Issue March 7, 1997
<PAGE> 138
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3.1 HOISTING AND EQUIPMENT
.1 Provide safe and adequate equipment on the site to execute the work,
hoisting, scaffolding, staging, safety protection equipment tools,
plant and other equipment required for the completion of the work.
3.2 INSTALLATION
.1 NOTE: This Contractor shall be aware of, and shall make whatever
allowance is considered necessary, for possible disruption in
installation sequencing due to crane and hoisting openings.
.2 Check structural elements and adjoining wall panels. Verify governing
dimensions. Conform conditions are satisfactory before proceeding.
.3 Erect curtain wall, and component parts by workmen trained and
experienced in this type of work. Have a senior, qualified
representative at the job to direct and supervise the various stages
of operation. Representative shall be present full time during the
assembly and erection of the work.
.4 Allow for dimensional tolerances and deviation from true plane
permissible in wall panels and structural frame. Erect curtain wall
units, and component parts plumb, level and true to building lines,
in correct relation to work of other trades and establish lines and
levels indicated.
.5 Provide anchors required for casting in. Comply with details on
approved shop and erection drawings. Ensure that anchor bolts,
embedded components, pockets and chases required for assembly
anchorage are properly located and positioned. Execute all drilling
of concrete or steel for supplementary inserts required.
.6 Separate aluminum surfaces in contact with concrete surfaces and
other dissimilar metals with PVC sheets.
.7 Form vapour air seal barrier pans for retention of insulation from
galvanized metal sheet. If jointing of the sheet metal is necessary
in the fabrication of the pans, lap, rivet and seal joints with
sealant. Install liner and secure to aluminum framing. Seal between
liner panels and junction of framing air/vapour tight.
.8 Install semi-rigid insulation and retain in place by use of aluminum
bars as specified. Cut insulation to fit metal liner pans. Adequately
drain and ventilate space between vapour barrier and spandrel and
metal panels to prevent condensation.
.9 Joints and intersections shall be accurately fitted in true planes,
free of distortion, waves, twists, buckles or other defects
detrimental to appearance or performance. Prevent damage to metal
finish. Accurately position, securely anchor mullion reinforcement.
Exercise care in assembly of expansion joints to ensure joint
function
Project No. 9654 Issue March 7, 1997
<PAGE> 139
ATTACHMENT "F"
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SECTION 08900
PAGE 22
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and that resilient seals are correctly positioned to provide
complete unbroken weather barrier.
.10 Install cut-offs at exterior to adjoining materials. Caulk and seal
junctions to provide weathertight seals. Fit flexible seals, tapes
and gaskets at locations required to provide water, weathertight
junctions. Ensure seal at end joints between lengths of material.
Seal junctions of system components to themselves and other work
with sealant to maintain effective vapour, air and water barrier.
Clean spaces and joints to be caulked of foreign matter that would
injure bond, wipe all metal surfaces to be sealed with cellulose
sponges or clean rags soaked with ethyl alcohol, a ketone solvent,
Xylol or Toluol, and wipe dry with clean cloth, prime surfaces.
Where joints are 1/2" deep or deeper, back sealant with joint
backing. Mask surfaces where required. Sealant bead depth shall be
half of width, but not less than 1/4". Apply sealants with pressure
gun having proper sized nozzles to fit the various joints. Use
sufficient pressure to fill the joints. Tool and finish joints.
Immediately clean adjacent materials which have been soiled.
.11 At interface with adjacent wall surfaces, install 22 ga. galvanized
metal or stainless steel sealed to curtain wall and adjacent air
vapour barrier system.
.12 Install firestop safing insulation on safing clips spaced 2'-0" o.c.
maximum in space between floor edge and wall panels to depth
required to achieve continuity of fire separation between floors.
Compress safing insulation to fill all voids. Apply silicone smoke
seal over safing.
.13 After completion of each wall panel section, provide protection to
all interior horizontal surfaces of aluminum within 3'-0" of the
floor.
3.3 CONVECTOR COVER
---------------
.1 Fabricate convector cover from extruded aluminum sections; minimum
1/8" thick.
.2 Cover shall be designed in module lengths to match the window
mullion spacing as shown.
.3 Cover shall be removable in modules for access. No exposed
fasteners.
.4 Top of cover shall be perforated to allow for air movement; 3/8"
diameter holes @ 1/2" staggered centres, 50% open for nominal 4"
width exclusive of borders. See drawings for exact dimensions.
Design internal structural supports to allow for aluminum to move
over temperature range without visual distortion to the exposed
aluminum.
3.4 ERECTION TOLERANCES
-------------------
.1 Maintain the following tolerances:
<PAGE> 140
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SECTION 08900
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.1 Maximum variation from plane or location shown on approved
shop drawings 1/16" in 15'-0" of length.
.2 Maximum offset from true alignment between two identical
members abutting end-to-end in line: 1/32"
.3 Racking of face: 1/8" maximum, racking in elevation: nil.
3.5 GLAZING
.1 Perform glazing in accordance with material manufacturer's
directions. Comply with FGMA (Flat Glass Marketing Association)
glazing manual.
.2 Handle and install glass in accordance with manufacturer's
directions. Prevent abrasion and other damage.
.3 Replace defective and damaged materials due to careless handling or
other causes resulting from work of this trade.
.4 The actual profiles, design parameters, dimensions, lengths and
locations of all glazing materials shall be as required to meet the
performance criteria and as recommended in writing by the
manufacturer.
.5 The glazing system must incorporate drainage and ventilation and meet
the air infiltration requirements.
.6 Use anti-walk blocks and setting blocks. Arrange anti-walk blocks and
setting blocks so as to avoid blocking water transfer inside frame.
.7 Set glass properly centred with uniform bite and face and edge
clearance, free from twist, warp or other distortion likely to
develop stress. Bite shall be minimum 1/2".
3.6 COPPER SIDING
.1 Over back-up board, apply one layer of roofing felt lapping each ply
2" in the direction of water flow and fastened with copper or bronze
nails driven through sheet copper washers not less than 1" square.
Place rosin-sized building paper over the roofing felt, lap each
joint minimum 2". Secure to wood strapping with large flat head
copper nails spaced not over 12" o.c. along edges and ends and in the
intermediate surfaces. Do not nail into aluminum supporting framework.
.2 All lubricants used in the fabrication of copper shall be removed
before work is shipped.
.3 Take special care to ensure that tools are free from particles of
iron or iron compounds.
<PAGE> 141
ATTACHMENT "F"
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SECTION 08900
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.4 All copper work shall be carried out in accordance with the best
standard practice using traditional copper methods with seams lapped
and folded. Fastenings shall be copper or bronze, concealed, with
ample provision for expansion. Note: design seams and cleats to allow
for movement of the panelized curtainwall system.
.5 Flat seam copper shall be by the pan method and shall consist of 16
oz. sheet copper formed into pans in the shop with a mechanical
bending brake. The longitudinal bends for the standing seams shall be
break formed. Close the last folds of the seams on site.
.6 Anchor the pans through the back-up board spandrels into the nailing
strips with copper cleats having 2 nails in each cleat and at spacing
at 16" centers. Bend back tab on the cleat over the nail heads to
prevent chafing. Lock cleats into seams.
.7 Make seams 3/4" wide.
.8 Make flat seams at ends of pans with adjacent pans.
3.7 SEALING
.1 Application of sealants shall be by skilled applicators installed in
accordance with manufacturer's printed directions and supervision.
The sealants shall be carefully applied to meet the design
requirements regarding water penetration and vapour/air seal barrier.
.2 Mask adjacent surfaces before priming and sealing. Remove masking
promptly upon completion of sealing. Clean dust, foreign matter and
any other material deleterious to the bond of sealing materials.
Prime joints as recommended by sealant manufacturer.
.3 Handle, store, prepare and use sealing materials in accordance with
the manufacturer's recommendations.
.4 Pack interior and exterior joints continuously with joint backing
material allowing a recess to receive sealant. Make recess depth
equal to joint width or as indicated. Leave opening in exterior
joints to comply with rain screen design.
.5 Seal joints between curtain wall and adjacent surfaces. Coordinate
sealing with sealing performed under other trades so that at
junctions in sealant, a continuous uniform full strength seal is
achieved.
.6 Maintain correct width to depth ratio of sealant. Gun in sealant
ensuring full bond to joint sides. Tool joints to profile shown, by
gun action or by separate operation. The surface of sealant shall be
a full bead smooth, free from ridges, wrinkles, sags, air pockets and
embedded impurities.
Project No. 9654
<PAGE> 142
ATTACHMENT "F"
CURTAIN WALL
SECTION 08900
PAGE 25
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.7 Apply sealant by means of pressure guns and using suitable nozzle, as
required.
.8 Coordinate the work with that of other Subcontractors to ensure proper
execution of the work of both trades.
3.8 THERMAFIBRE FIREPROOFING TO CURTAIN WALL
.1 Materials specified shall be by U.S. Gypsum or approved equal, and
shall be installed in accordance with the current printed directions.
.2 All materials shall be delivered in their original, unopened packages
and stored in an enclosed shelter providing protection from damage
and exposure to the elements. Damaged or deteriorated materials shall
be removed from the site.
.3 Curtain wall insulation shall be 1 hour fire tested in accordance
with ASTM E119.
.4 Thermafibre curtain wall insulation shall be foil faced, 50 mm,
CW-40, to meet fire test USG 10.18.71.
.5 Mechanically attach thermafibre insulation to curtain wall in
addition to stick clips at approximately 300 mm o.c., with foil
facing inward. Butt ends and edges tightly and fill all voids.
.6 Insulation thickness shall be maintained around all mullions and
anchor locations. Provide extra length stick clips at these locations.
.7 Thermafibre fire proofing is required at perimeter of all floors,
extending from floor line down to head of vision glass (ceiling line).
3.9 FIRE/SMOKE STOP
.1 Supply and install firestop continuously between curtain wall and
floor slab.
.2 Install firestop safing insulation with safing "Z" clips. ULI label.
.3 Over safing, install sealant.
3.10 SPARE MATERIAL
.1 Provide to the Owner for spares the following sealed glazed units:
10 typical large (8'-8" wide x 6'0" high approximately);
5 typical small (3'-10" wide x 6'0" high approximately);
10 typical wide upper lites (8'-8" wide x 3'9" high approximately);
5 typical narrow upper lites (3'-10" wide x 3'9" high approximately)
Project No. 9654
<PAGE> 143
ATTACHMENT "F"
CURTAIN WALL
SECTION 08900
PAGE 26
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<TABLE>
<CAPTION>
PROJECT SWISS RE AMERICA HEADQUARTERS PROJ. No. No.
T96183 BSK-47
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
DESIGN DRAWN CHECKED DATE W.P. No.
RH RH PZ Feb. 11, 1997 622
- -----------------------------------------------------------------------------------------
SUBJECT
1. SWING STAGE FES
DESIGN LOAD PARAMETERS LOAD DELETED 26ST
FOR PERIMETER CATWALK
2. NOTE E ???
DELETED ???
</TABLE>
[DIAGRAM]
NOTES:
1. LOAD 1 TO BE TWO INDEPENDENT LOAD CASES;
a) A UNIFORM SERVICE LIVE LOAD OF 50 PSF.
b) THE POINT LOAD (ANYWHERE) FROM A 300 LB. PERSON PLUS THE WEIGHT OF ONE
GLASS PANEL (ASSUMED TO BE 600 LBS. MAX. WORKING LOAD).
2. LOAD 2 TO BE 5000 LBS. ACTING IN ANY DIRECTION FROM A SAFETY LIFELINE OR A
BOSUN CHAIR (INCLUDES A FACTOR OF SAFETY OF FOUR) ANYWHERE ALONG THE
MONORAIL.
3. LOAD 3 TO BE 5000 LBS ACTING IN ANY DIRECTION FROM A SAFETY LIFELINE
(INCLUDES A FACTOR OF SAFETY OF FOUR) ANYWHERE ALONG THE TIE-OFF LINE.
4. LOADS 1 AND 2 TO BE CONSIDERED SIMULTANEOUSLY.
5. LOADS 1 AND 3 TO BE CONSIDERED SIMULTANEOUSLY.
Project No. 9654
<PAGE> 144
ATTACHMENT "F"
CURTAIN WALL
SECTION 08900
PAGE 27
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Yolles
??????
SWISS RE AMERICA
HEADQUARTERS
<TABLE>
<CAPTION>
<S> <C> <C>
Project No.: T86155 CHECKED: P.Z. Sketch No: BSK-69
Drawn: R.V. Scales: M.T.S. Date: March 4, 1997
</TABLE>
STEEL ERECTION TOLERANCES
-------------------------
1. REFER TO NSC MANUAL OF STANDARD PRACTICE AND
THE FOLLOWING:
2. BASE PLATES SHALL BE AT ??? FROM THEIR
SPECIFIED ELEVATION.
3. SPLICES SHALL BE WITHIN ??? OF THEIR
SPECIFIED ELEVATION.
4. ELEVATION OF MEMBERS: ENDS OF MEMBERS SHALL
BE WITHIN ??? OF THE SPECIFIED MEMBER
ELEVATION. ALLOWANCES SHALL BE MADE FOR
INITIAL BASE ELEVATION AND TEMPERATURE
EFFECTS. MAXIMUM SLOPE SHALL NOT EXCEED
L/500. THE DIFFERENCE FROM THE SPECIFIED
ELEVATION BETWEEN MEMBER ENDS THAT MEET AT A
JOINT SHALL NOT EXCEED ???.
5. HORIZONTAL ALIGNMENT: ALIGN SPANDREL BEAMS SO
THAT THE OFFSET OF ONE END RELATIVE TO THE
OTHER FROM THE ALIGNMENT SHOWN ON THE
DRAWINGS DOES NOT EXCEED L/500. OFFSETS FOR
SPANDREL BEAMS SHALL NOT EXCEED ???. OFFSETS
FOR OTHER BEAMS SHALL NOT EXCEED ???.
COLUMN ERECTION TOLERANCES
- --------------------------
???
Project No. 9654
<PAGE> 145
ATTACHMENT "F"
CURTAIN WALL
SECTION 08900
PAGE 28
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- --------------------------------------------------------------------------------
[MAP]
- --------------------------------------------------------------------------------
END OF SECTION 08900
Project No. 9654
<PAGE> 146
ATTACHMENT "G"
SWISS RE AMERICA U.S. HEADQUARTERS TURNER CONSTRUCTION CO.
NORTH CASTLE, NY 3/31/97
ADDENDUM #1
CURTAINWALL BIDDER QUESTIONS
1. Q: Should the vapor barrier be on the interior side of the
insulation, not exterior as specified (08900.4.2.1)?
A: YES
2. Q: Re-back-up board 3/8" thick to achieve STC 40 through spandrel
areas. Should this material be attached to back pans at ALL
exterior and interior corner conditions? Also, typical details
1,2,3,6 etc. on drawing A 5.02?
A: The intent is that the interior drywall runs structure to
structure and substitutes for the 3/8" back-up board in these
areas and is therefore not in the curtainwall contract for these
areas.
3. Q: Who supplies the reveal at the typical column detail 5/A5.02,
Curtainwall or Drywall Contractor?
A: Drywall Contractor
4. Q: Is all of the work at the catwalks by the Curtainwall
Contractor with the exception of the monorail trolley and
lifeline anchors, which are by the window washing manufacturer?
A: YES See detail 8/A5.04
5. Q: For ease of installation, should the lifeline anchors be
furnished and installed by the Curtainwall Contractor?
A: NO
<PAGE> 147
ATTACHMENT "H"
[ADAMSON ASSOCIATES LETTERHEAD]
To: T. Riggi
From: Jim Bagby
Date: April 22, 1997
Copies: Michael A. DiNallo, I. Berger
Re: Swiss Re
Curtain Wall
Flour City Architectural Metals submitted revised drawings in our meeting
yesterday. The drawings are numbered SK-1 through 5 Rev. A dated April 17,
1997. These drawings are acceptable to us as indicating their design for the
typical wall with the following provisos:
.1 SK-2 Detail 2
Provide sealant around all penetrations of the galvanized pan; eg,
screws holding cement board to pan.
Relocate galvanized sheet between vertical mullions to the warm side
of the insulation (between the insulation and the cement board and
seal to mullions.
Locate wood naller to suit copper cleat locations. (typical all
details) Flour City may wish to consider running nallers vertically.
This is the short span and will allow for drainage.
Subject to Flour City's acceptance, there is a preference of the
curtain wall consultant to resolve horizontal expansion between the
vertical mullions in lieu of the usual location at the ends of the
horizontal members.
Insulation will not be held in place by stick-clips 'welded' to back
pan. Epoxy
<PAGE> 148
ATTACHMENT "H"
glue is acceptable.
.2 SK-3 Detail 3
A 1 1/2" x 1 1/2" reveal will be left in the ceiling to allow for the
removal of the window stop. (at shade pocket)
.3 SK-3 Detail 4
A thin aluminum extension will be sealed to the sill of the glazing
reveal to direct water to the edge of the vertical glazing reveal to
drain off any water.
.4 SK-3 Detail 5
The sill of the glazing reveal will be lowered.
Flour City is proposing a different smoke seal from that which was
specified.
This is acceptable provided it is ULI rated and installed in
accordance with their recommendations.
As per the specifications, Flour City will reinforce the back pan as
necessary to prevent movement of the back pan such that the fire
safing will become loose or dislodged.
The steel clip anchoring the runner brace shall not be welded to side
of pan. (destroys galvanizing)
.5 SK-4 Detail 6
This detail requires major modification. The galvanized back pan must
seal to the concrete beam face.
.6 SK-5 Soffit Section
Provide perforated soffit panels as shown on the architectural
drawings.
Provide alignment sleeves at soffit panel joints.
NOTE: NOT DISCUSSED AT MEETING
The stainless steel hanger bar shall not be welded to structure.
Provide a bolted connection. (to avoid destroying the galvanizing of
structural steel)
.7 SK-6 Section at Catwalk
5" X 5" steel section shall be non-ferrous; either stainless steel or
aluminum.
Other items discussed at the meeting:
.1 Weather
Flour City's schedule assumes no delay for weather. This is not
realistic as their field assembled wall is weather dependent. We
would not recommend that this clause be included in the contract.
.2 Door Hardware
We will change the door panic exit device from the Van Duprin
specified. The panic device will be a "crash" bar and rim panic
device (similar to
<PAGE> 149
ATTACHMENT "H"
Kawneer Dor-O-Matic 2090)
.3 Protection
The specification calls for the supply and removal of protection of
horizontal surfaces. You may wish to change this to supply only.
.4 Shop Drawings, RFI's
We will use our best efforts to meet Flour City's 10 working day
schedule, however, we cannot agree that at all times and in all
instances this schedule will be met.
Flour City's schedule assumes only two submissions of shop drawings.
It if our experience that there are many more submissions of drawings
than this.
<PAGE> 150
ATTACHMENT "H"
ADAMSON ASSOCIATES
[Letterhead]
TO: T. Riggi
FROM: Jim Bagby
DATE: April 22, 1997
COPIES: Sacha Menz
RE: Swiss Re
Curtain Wall
We have received from SARM comments on our March 27 progress drawing issue
which affect the curtain wall. As the tenders on the curtain wall have now been
received and award of contract is imminent, please advise how you would like us
to incorporate the comments. (Addendum, change order etc. to contract
documents) Ideally, for those comments that are acceptable to the client, you
should attempt to include in the last-minute tender negotiations.
1. Mid-horizontal rail
We call for the interior finish to be black Duracon paint finish. SARM are
requesting the interior finish to be clear and anodized. -- No cost impact
by FCAM.
2. Soffit
SARM are requesting a stainless steel mesh in lieu of the 3" wide
perforated reveal (next to the fascia) of the soffit.
SARM are requesting that the soffit not be black. Although SARM do not
advise what colour they would like, provided they do not select clear and
anodize, we assume that there is no cost to change colour. However, to be
safe, I would recommend that this change be given to the contractor. --
Not included in base contract by FCAM. [TOO REVIEW AND OR PRICE BY FCA.]
3. DETAIL 8 Drwg A5.01
SARM are asking why the channel is not steel. I believe the comments are by
Yonas and he has not discussed them with Sasha. However, when Sasha was in
our offices, this item was discussed. Basically, steel rusts. In both
cases, whether the channel is steel or aluminum, expansion joints are
required. The joint design is identical. Included in base price.
Project No. 9654 Issue March 7, 1997
<PAGE> 151
ATTACHMENT "H"
<PAGE> 152
13. The Trade Contractor for the Price herein provided, hereby accepts and
assures exclusive liability for and shall indemnify, protect and save
harmless the Owner from and against the payment of:
A. All contributions, taxes or premiums (including interest and
penalties thereon) which may be payable under the Unemployment
Insurance Law of any State, Federal Social Security Act,
Federal, State, County and/or Municipal Tax Withholding Laws,
or any other law, measured upon the payroll of or required to
be withheld from employees, by whomsoever employed, engaged in
the Work to be performed and furnished under this Agreement.
B. All use, personal property and other taxes (including interest
and penalties thereon) required by any Federal, State, County,
Municipal or other law to be paid or collected by the Trade
Contractor or any of its Subcontractors or vendors or any
other person or persons acting for, through or under it or any
of them, by reason of the performance of the Work or the
acquisition, ownership, furnishing or use of any materials,
equipment, supplies, labor, services or other items for or in
connection with the Work.
C. All pension, welfare, vacation annuity and other union benefit
contributions payable under or in connection with labor
agreements with respect to all persons, by whomsoever
employed, engaged in the Work to be performed and furnished
under this Agreement.
Such indemnification of the Owner by the Trade Contractor
shall include any expenses, including legal fees and
litigation arising from, or related to the Trade Contractor's
failure to pay any sales, use, personal property or other
taxes based upon labor, services, materials, equipment or
other items acquired, performed, furnished or used for or in
connection with the Work.
14. Notwithstanding the dimensions on the Drawings, Specifications and
other Contract Documents, it shall be the obligation and responsibility
of the Trade Contractor to take such measurements as will insure the
proper matching and fitting of the Work covered by this Agreement with
CONTIGUOUS WORK*. The Trade Contractor's submission of a shop drawing
shall constitute the Trade Contractor's representation, upon which the
Owner, the Construction Manager and the Design Team may rely, that the
Trade Contractor has reviewed the submission for accuracy and
compliance with all Contract Documents and that whenever engineering is
required to be performed, such engineering has been performed by a
qualified and licensed engineer. Furthermore, the review of the Shop
Drawings by the Owner, the Construction Manager and the Design Team
shall not constitute an undertaking by any of them to identify
deficiencies in the submission, that being an undertaking within the
sole responsibility of the Trade Contractor.
4
<PAGE> 153
* REFER TO RIDER 'A' ITEM #2
15. The Work hereunder is to be performed to the satisfaction of the Owner.
The Trade Contractor shall not make any changes, additions and/or
omissions in the Work except upon written order of the Owner as
provided in the General Conditions.
16. The Trade Contractor shall at all times provide sufficient, safe and
proper facilities for the inspection of the Work by the Owner, the
Construction Manager, the members of the Design Team and their
authorized representatives in the field, at shops or at any other place
where materials or equipment for the Work are in the course of
preparation, manufacture, treatment or storage. The Trade Contractor
shall, within twenty-four (24) hours after receiving written notice
from the Owner or its authorized representatives to that effect,
proceed to take down all portions of the Work and remove from the
premises all materials whether worked or unworked, which the Owner or
its authorized representatives shall condemn as unsound, defective or
improper or as in any way failing to confirm to this Agreement or the
Plans, Specifications or other Contract Documents, and the Trade
Contractor, at its own cost and expense, shall replace the same with
proper and satisfactory work and materials and make good all work
damaged or destroyed by or as a result of such unsound, defective,
improper or nonconforming work or materials or by the taking down,
removal or replacement thereof.
17. The Trade Contractor shall remove, replace and/or repair at its own
expense and at the convenience of the Owner any faulty, defective or
improper Work, materials or equipment discovered within one (1) year
from the date of the acceptance of the Project as a whole by the Owner
or for such longer period as may be provided in the Drawings,
Specifications, General Conditions, Special Conditions or other
Contract Documents.
18. The Contractor hereby guarantees the Work to the full extent provided
in the Drawings, Specifications, General Conditions, Special Conditions
and other Contract Documents. Without limiting the generality of the
foregoing, the Trade Contractor warrants to the Owner, that all
materials and equipment furnished under this Agreement will be of first
class quality and new, unless otherwise required or permitted by the
other Contract Documents, that the Work performed pursuant to this
Agreement will be free from defects and that the Work will strictly
conform with the requirements of the Contract Documents. Work not
confirming to such requirements, including substitutions not properly
approved and authorized, shall be considered defective. All warranties
contained in this Agreement and in the Contract Documents shall be in
addition to and not in limitation of all other warranties or remedies
required and/or arising pursuant to applicable law.
5
<PAGE> 154
19. The Trade Contractor acknowledges that its right to remedies pursuant
to New York Mechanic's Lien Law shall be governed, to the fullest
extent permitted by law, by the following:
A. The Trade Contractor agrees that its rights to pursue a lien
shall be limited to that portion of its Contract Price which
is unpaid and due at the time of filing a lien claim under the
terms of this Trade Contract. The Trade Contractor agrees that
it shall not file liens for any sum which is not due hereunder
and specifically agrees and covenants that it will not file
liens for sums which it may contend are due as damages by
reason of delays or other such claims unless such sums are
agreed due to the Trade Contractor by written contract
modification. The Trade Contractor agrees that its lien
rights, whatever they may be, are reduced by each payment made
to the Trade Contractor by the Owner or any other party on
behalf of the Owner.
B. If any claim or lien is made or filed with or against the
Owner, the Project premises or the Project funds by any person
claiming that the Trade Contractor or any Subcontractor or
other person under subcontract has failed to make payment for
any labor, services, materials, equipment, taxes or other
items or obligations furnished or incurred for or in
connection with the Work, or if at any time, there shall be
evidence of such nonpayment or of any claim or lien for which,
if established, the Owner might become liable and which is
chargeable to the Trade Contractor, or if the Trade Contractor
or any Subcontractor or other person under subcontract causes
damage to the Work or to any other work on the Project, or if
the Trade Contractor fails to perform or is otherwise in
default under any of the terms or provisions of this Trade
Contract, the Owner shall have the right to retain from any
payment then due or thereafter to become due an amount which
it deems sufficient to (i) satisfy, discharge and/or defend
against any such claim or lien or any action which may be
brought or judgment which may be recovered thereon, (ii) make
good any such nonpayment, damage, failure or default, and
(iii) compensate the Owner for and indemnify and hold it
harmless against any and all losses, liability, damages, costs
and expenses, including legal fees and disbursements, which
may be sustained or incurred by it in connection therewith.
The Owner shall have the right to apply and charge against the
Trade Contractor so much of the amount retained as may be
required for the foregoing purposes. If the amount is
insufficient therefor, the Trade Contractor shall be liable
for the difference and pay the same to the Owner.
6
<PAGE> 155
C. The Trade Contractor acknowledges that a claim lien filed by
it may be disruptive of Project finances. Therefore, the Trade
Contractor further agrees that if it files a lien claim which
is not permitted by law, or which contains claims where are
not permissible hereunder, or which is negligently or
purposefully overstated, the Owner shall be entitled to
receive from the Trade Contractor all its damages arising
therefrom and further be held harmless and indemnified by
Trade Contractor from all claims of other Trade Contractors
arising therefrom.
D. If any Subcontractor, laborer, materialmen or supplier of the
Trade Contractor or any other person directly or indirectly
acting for, through or under it or any of them files or
maintains a lien or claim, whether a mechanics' lien or an
attested account or otherwise, a mechanic's lien or claim
against the Project funds or Project premises or any part
thereof or any interests therein or any improvements thereon
or against any monies due or to become due from the Owner to
the Trade Contractor, for or on account of any work, labor,
services, materials, supplies, equipment or other items
performed or furnished for or in connection with the Work or
under any change order or supplemental agreement for extra or
additional work in connection with the Project, the Trade
Contractor agrees to cause such liens and claims to be
satisfied, removed or discharged at its own expense by bond,
payment or otherwise within fifteen (15) days from the date of
the filing thereof, and upon its failure to do so the Owner
shall have the right, in addition to all other rights and
remedies provided under this Agreement and the other Contract
Documents or by law, to cause such liens or claims to be
satisfied, removed or discharged by whatever means the Owner
chooses, at the entire cost and expense of the Trade
Contractor (such cost and expense to include legal fees and
disbursements). The Trade Contractor agrees to indemnify,
protect and save harmless the Owner from and against any and
all such liens and claims and actions brought or judgments
rendered thereon, and from and against any and all loss,
damages, liability, costs and expenses, including legal fees
and disbursements, which the Owner may sustain or incur in
connection therewith.
20. To the fullest extent permitted by law, the Trade Contractor agrees
that it shall not assign, sell, transfer, delegate or encumber any
rights, duties or obligations arising under this Agreement including,
but not limited to, any right to receive payments hereunder, without
the prior written consent of the Owner. Such consent may be granted or
denied in the Owner's sole discretion and the giving of any such
consent to a particular assignment shall not dispense with the
necessity of such consent to any further or other assignments.
7
<PAGE> 156
21. Notices, demands or requests shall be in writing, delivered in person
or mailed by registered or certified mail, postage prepaid, or by the
sending of hand delivery addressed to the parties hereto at their
addresses above stated. Notices to the Contractor shall be to the
attention of Mr. Donald Kondas, Project Manager, and to the Owner shall
be to the attention of Sara B. Fox, Senior Vice President and Thomas L.
Forsyth, Esq.
22. The Trade Contract and the other Contract Documents constitute the
entire agreement between the parties. The Trade Contractor agrees that
any claims against Owner, irrespective of an alleged breach by Owner of
the Contract, shall be based, nonetheless, upon the Trade Contract and
the Contract Price, and shall in no event based upon an asserted fair
and reasonable value of the Work performed.
23. No representation or other agreements have been made other than as set
forth in the Contract, which may not be changed, nor any term or
provision thereof waived except in writing signed by the Owner's duly
authorized agent or officer.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.
TRADE CONTRACTOR SWISS RE INVESTORS, INC.
By: /s/ MICHAEL J. RUSSO By: /s/ SARA B. FOX
---------------------------- -------------------------------
Name: Michael J. Russo Name: Sara B. Fox
-------------------------- ------------------------------
Title: President Title: Senior Vice President
------------------------- -----------------------------
Witness of Flour City By: /s/ PATRICIA LIOI
-------------------------------
[SIG] Name: Patricia Lioi
- ------------------------------- ------------------------------
5/19/97 Title: Vice President
- ------------------------------- -----------------------------
8
<PAGE> 1
EXHIBIT 11.1
FLOUR CITY INTERNATIONAL, INC.
EARNINGS PER SHARE
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
----------------------------------------------
1995 1996 1997
------------ ------------ ------------
<S> <C> <C> <C>
Net income (000)................................. $ 996 $ 1,548, $ 5,226
============ ============ ============
Average shares outstanding:
Historical FCAM Pacific.......................... 100 100 100
Effect of FCI merger............................. 8,999,900 8,999,900 8,999,900
Effect of employee stock grants.................. -- -- 833,333
International Forest Share Exchange.............. 16,182,000 16,182,000 17,680,332
Effect of shares issued to International Forest
shareholders (Public Merger)................... -- -- 1,162,333
------------ ------------ ------------
Historical shares outstanding.................... 25,182,000 25,182,000 28,675,998
Reverse stock split of 1 for 7................... (21,584,571) (21,584,571) (24,579,427)
------------ ------------ ------------
Pro-forma shares outstanding..................... 3,597,429 3,597,429 4,096,571
============ ============ ============
Earnings per share-historical.................... $ .04 $ .06 $ .18
============ ============ ============
Earnings per share-pro-forma..................... $ .28 $ .43 $ 1.28
============ ============ ============
</TABLE>
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the use in this Registration Statement of Flour City
International, Inc. on Form S-1 of our reports dated December 5, 1997 on the
financial statements of Flour City International, Inc. and June 4, 1997 on the
financial statements of Flour City Architectural Metals, Inc. appearing in the
Prospectus, which is part of this Registration Statement and of our Report dated
June 26, 1997 relating to the Financial Statement Schedule appearing elsewhere
in the Registration Statement.
We also consent to the reference to us under the headings "Selected
Financial Data" and "Experts" in such Prospectus.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Nashville, Tennessee
January 7, 1998
<PAGE> 1
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the use in this Registration Statement of Flour City
International, Inc. on Form S-1 of our report dated June 26, 1997 on the
financial statements of Flour City Architectural Metals (Pacific) Ltd. appearing
in the Prospectus, which is part of this Registration Statement and of our
Report dated June 26, 1997 relating to the Financial Statement Schedule
appearing elsewhere in the Registration Statement.
We also consent to the reference to us under the headings "Selected
Financial Data" and "Experts" in such Prospectus.
/s/ Deloitte Touche Tohmatsu
DELOITTE TOUCHE TOHMATSU
Hong Kong
January 7, 1998
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1997
<PERIOD-START> NOV-01-1996
<PERIOD-END> OCT-31-1997
<CASH> 341,825
<SECURITIES> 0
<RECEIVABLES> 14,179,228
<ALLOWANCES> 777,625
<INVENTORY> 0
<CURRENT-ASSETS> 20,100,183
<PP&E> 617,570
<DEPRECIATION> 162,543
<TOTAL-ASSETS> 22,568,649
<CURRENT-LIABILITIES> 11,588,856
<BONDS> 0
0
0
<COMMON> 3,052
<OTHER-SE> 9,156,099
<TOTAL-LIABILITY-AND-EQUITY> 22,568,649
<SALES> 31,875,264
<TOTAL-REVENUES> 32,305,828
<CGS> 18,030,449
<TOTAL-COSTS> 24,147,127
<OTHER-EXPENSES> 1,549,995
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 52,132
<INCOME-PRETAX> 6,972,571
<INCOME-TAX> 1,752,496
<INCOME-CONTINUING> 5,220,075
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,226,031
<EPS-PRIMARY> .18
<EPS-DILUTED> 0
</TABLE>
