<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
__X__Quarterly Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
for the quarterly period ended March 31, 1997
or
_____Transition Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
for the transition period from_____to_____
Commission File No. 0-8836
------
NUCLEAR METALS, INC.
--------------------
(Exact name of Registrant as specified in its charter)
Massachusetts 04-2506761
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2229 Main Street, 01742
Concord, Massachusetts (Zip Code)
(Address of Principal Executive Offices)
(508) 369-5410
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding twelve months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
----------- --------
As of April 30, 1997 there were issued and outstanding 4,782,928 shares of the
Registrant's Common Stock.
<PAGE>
NUCLEAR METALS, INC. AND SUBSIDIARIES
FORM 10-Q
for the quarterly period ended March 31, 1997
INDEX
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Page
----
Part I. Financial Information 2
Item 1. Financial Statements
Consolidated Balance Sheets:
March 31, 1997 and September 30, 1996 3
Consolidated Statements of Income:
Three Months Ended March 31, 1997
and March 31, 1996 4
Consolidated Statements of Income:
Six Months Ended March 31, 1997 and March 31, 1996 5
Consolidated Statements of Cash Flow:
Six Months Ended March 31, 1997 and March 31, 1996 6
Notes to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8-10
Part II. Other Information 11
Item 6. Exhibits and Reports on Form 8-K 11
SIGNATURES 12
<PAGE>
PART I
Item 1. Financial Statements
Preparation of Financial Statements
The financial statements included herein have been prepared by the Company
pursuant to the rules and regulations of the Securities and Exchange Commission
and are subject to year-end audit by independent public accountants. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations. It is suggested
that the financial statements be read in conjunction with the financial
statements and notes included in the Company's most recent Annual Report on Form
10-K.
The information furnished reflects all adjustments which, in the opinion
of management, are necessary for a fair statement of results for the interim
periods. It also should be noted that results for the interim periods are
not necessarily indicative of the results expected for any other interim
period or for the full year.
-2-
<PAGE>
NUCLEAR METALS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
MARCH 31, SEPTEMBER 30,
1997 1996
----------- -------------
Assets
Current Assets:
Cash and cash equivalents................ $ 198,000 $ 1,051,000
Restricted Cash.......................... 250,000 250,000
Accounts receivable, net of allowances
for doubtful accounts of $421,000 at
March 31, 1997 and $821,000 at
September 30, 1996...................... 4,420,000 4,931,000
Inventories.............................. 11,679,000 12,025,000
Other current assets..................... 576,000 376,000
------------- -------------
Total current assets................. 17,123,000 18,633,000
------------- -------------
Property, Plant and Equipment.............. 47,748,000 46,980,000
Less accumulated depreciation............ 32,584,000 31,834,000
------------- -------------
Net property, plant and equipment........ 15,164,000 15,146,000
------------- -------------
Other assets............................... 1,222,000 1,339,000
------------- -------------
$ 33,509,000 $ 35,118,000
------------- -------------
------------- -------------
Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt....... $ 950,000 $ 510,000
Accounts payable and accrued expenses... 6,224,000 8,874,000
------------- -------------
Total current liabilities............... 7,174,000 9,384,000
------------- -------------
------------- -------------
Notes Payable to Shareholders'............ 749,000 850,000
------------- -------------
Long term obligations..................... 594,000 644,000
------------- -------------
Stockholders' equity:
Common stock, par value $.10; authorized-
12,000,000 shares; 4,782,928 issued and
outstanding for March 31, 1997 and
4,781,928 issued and outstanding
for September 30, 1996.................. 478,000 478,000
Additional paid-in capital................ 14,022,000 13,889,000
Warrants Issued........................... 130,000 130,000
Retained earnings......................... 10,362,000 9,743,000
------------- -------------
Total stockholders' equity.............. 24,992,000 24,240,000
------------- -------------
$ 33,509,000 $ 35,118,000
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------------- -------------
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<PAGE>
NUCLEAR METALS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE PERIODS ENDED:
(Unaudited)
THREE MONTHS ENDED
---------------------------
MARCH 31, MARCH 31,
1997 1996
------------ -------------
Net sales and contract revenues................ $5,342,000 $10,021,000
Cost and expenses
Cost of sales................................ 3,318,000 8,163,000
Selling, general and administrative.......... 1,400,000 1,345,000
Research and development..................... 451,000 226,000
---------- -----------
Total Cost and expenses...................... 5,169,000 9,734,000
---------- -----------
Operating income............................... 173,000 287,000
Other income................................... 2,000 67,000
Interest expense, net.......................... (64,000) (123,000)
---------- -----------
Income before income taxes..................... 111,000 231,000
Benefit (Provision) for income taxes........... (2,000) 7,000
---------- -----------
Net income..................................... $ 109,000 $ 238,000
---------- -----------
---------- -----------
Per Share Information
- ---------------------
Net income per common and common
equivalent share............................. $ 0.02 $ 0.05
---------- -----------
---------- -----------
Weighted average number of common and common
equivalent shares outstanding................ 4,957,930 4,795,505
-4-
<PAGE>
NUCLEAR METALS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE PERIODS ENDED:
(Unaudited)
SIX MONTHS ENDED
----------------
MARCH 31, MARCH 31,
1997 1996
------------- -------------
Net sales and contract revenues................... $ 12,613,000 $16,692,000
------------- -----------
Cost and expenses
Cost of sales................................... 8,588,000 13,398,000
Selling, general and administrative............. 2,587,000 2,449,000
Research and development........................ 699,000 360,000
------------- -----------
Total Cost and expenses......................... 11,874,000 16,207,000
------------- -----------
Operating income.................................. 739,000 485,000
Other income...................................... 11,000 70,000
Interest expense, net............................. (119,000) (212,000)
------------- -----------
Income before income taxes........................ 631,000 343,000
Benefit(Provision) for income taxes............... (13,000) 4,000
------------- -----------
Net income........................................ $ 618,000 $ 347,000
------------- -----------
------------- -----------
Per Share Information
- ---------------------
Net income per common and
common equivalent share......................... $ 0.13 $ 0.07
------------- -----------
------------- -----------
Weighted average number of common
and common equivalent shares
outstanding..................................... 4,920,378 4,777,666
-5-
<PAGE>
NUCLEAR METALS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW
FOR THE PERIODS ENDED:
(Unaudited)
SIX MONTHS ENDED
------------------------
MARCH 31, MARCH 31,
1997 1996
--------- ---------
Cash flows from operating activities:
Net income...................................... $618,000 $ 406,000
Adjustments to reconcile net income to net
cash provided (used) by operating
activities:
Depreciation and amortization................. 751,000 778,000
Changes in assets and liabilities, net
(Increase) decrease in accounts receivable... 511,000 287,000
(Increase) decrease in other current assets.. -- --
(Increase) decrease in deferred income tax
benefit..................................... -- --
(Increase) decrease in inventories........... 346,000 (504,000)
Increase (decrease) in accounts payable and
accrued expenses............................ (2,650,000) 146,000
Gain on sale of building...................... -- (175,000)
Changes in prepaid and deferred taxes......... (200,000) (187,000)
Changes in other long-term liabilities........ -- --
Other......................................... 116,000 (115,000)
---------- -----------
Net cash provided (used) by operating
activities.................................. (508,000) 636,000
---------- -----------
Cash flows from investing activities:
Capital expenditures, net..................... (785,000) (422,000)
(Purchase) Sale of Marketable Securities...... -- 218,000
Proceeds from sale of Property, Plant &
Equipment.................................... 12,000 487,000
Other......................................... -- --
---------- ----------
Net cash provided (used) in investing
activities.................................. (773,000) 283,000
---------- ----------
Cash flows from financing activities:
Total payments of debt, gross................. (1,994,000) (916,000)
Proceeds from debt............................ 2,422,000 (532,000)
(Purchases) issuances of common stock......... -- 359,000
Cash Dividends................................ -- --
---------- ----------
Net cash provided (used) in financing
activities.................................. 428,000 (1,089,000)
---------- ----------
Net increase (decrease) in cash and equivalents... (852,000) (170,000)
Cash and equivalents at beginning of the
period....................................... 1,301,000 1,213,000
---------- ----------
Cash and equivalents at end of the period..... $ 448,000 $ 1,043,000
---------- ----------
---------- ----------
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest, net of amounts capitalized......... $ 46,000 $ 216,000
Income taxes................................. $ -- $ --
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<PAGE>
NOTES
1. The significant accounting policies followed by the Company in
preparing its consolidated financial statements are set forth in Note (2) to
such financial statements included in Form 10-K for the fiscal year ended
September 30, 1996.
2. Inventories are stated at the lower of cost (first-in, first-out) or
market, and include labor, materials, and overheads for manufacturing and
engineering. Inventories at March 31, 1997 and September 30, 1996 consist of:
March 31, September 30,
1997 1996
--------- -------------
Work-in process $8,319,000 $ 8,697,000
Raw materials 2,658,000 2,620,000
Spare parts 702,000 708,000
----------- -----------
$11,679,000 $12,025,000
----------- -----------
----------- -----------
3. All references to shares of Common Stock have been restated to
reflect a two-for-one stock split in the form of a dividend effective
April 7, 1997.
4. New Accounting Standard - In March 1997, the Financial Accounting
Standards Board issued SFAS No. 128, Earnings Per Share. SFAS No. 128
establishes standards for computing and presenting earnings per share and
applies to entities with publicly held common stock. This statement is
effective for fiscal years ending after December 15, 1997 and early adoption
is not permitted. When adopted, the statement will require restatement of
prior years earnings per share. The Company will adopt this statement for its
fiscal year ending September 30, 1998 and does not believe that the effect of
the adoption of this standard would be materially different from the amounts
presented in the accompanying statements of income.
-7-
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Second Quarter Fiscal 1997 Compared With Second Quarter Fiscal 1996
Net sales decreased by $4,679,000 or 47% to $ 5,342,000 in the second
quarter of fiscal 1997. Sales in the Uranium Services & Recycle industry
segment decreased by $1,767,000 or 80%. Sales in the Specialty Metal Products
industry segment decreased by $136,000 or 4%. Sales in the Penetrator
industry segments decreased by $2,776,000 or 62%.
The sales decrease in the Uranium Services and Recycle industry segment
was primarily due to lack of volume in depleted uranium products in the
current quarter due to completion of a production contract for a foreign
customer in fiscal 1996. The sales decrease in the Specialty Metal Products
industry segment was primarily due to decreased volumes of beryllium product
partially offset by higher volumes of medical powders. The sales decrease in
the Depleted Uranium Penetrator industry segment was due to volume decreases
in foreign military sales to a significant customer.
Gross profit in the second quarter increased by $166,000 or 9% to
$2,024,000. The increase in gross profit was primarily the result of a
reduction in the reserve requirements for certain site remediation costs of
$670,000 based on current contracts the Company has entered into for outside
services and recognition of $280,000 of revenue that had previously been
deferred. The increase in gross profit also includes a reduction of $650,000
in inventory reserves resulting from Management's confidence that current and
anticipated orders will utilize existing inventory. This was partially
offset by start-up costs on the first production orders for
Beralcast-Registered Trademark-, NMI's patented lightweight material. As a
percentage of sales, gross profit was 38% as compared to 19% for the second
quarter of fiscal 1996.
Selling, general and administrative expenses increased by $55,000 or 4%
as compared to the second quarter of fiscal 1996. As a percentage of sales,
selling, general and administrative expenses increased to 26% as compared to
13% for the same period a year earlier.
Other income decreased by $65,000 to $2,000, compared to $67,000 for the
second quarter of fiscal 1996. This decrease was primarily due to lower
amounts available for investment.
Interest expense decreased by $59,000 to $64,000, from $123,000 for the
same period a year earlier. This decrease was primarily the result of the
Company's higher levels of outstanding debt during the second quarter of
fiscal 1996 as compared to the second quarter of fiscal 1995.
Income taxes benefited during the second quarter of fiscal 1996 and
fiscal 1997 were at an effective rate of 2% net of approximately $11,000 of
income tax refunds received in the second quarter of fiscal 1996. The Company
has unrecognized net operating loss carryforwards resulting in a minimal
effective tax rate.
-8-
<PAGE>
SIX MONTHS Fiscal 1997 Compared With SIX MONTHS Fiscal 1996
Net sales decreased by $4,079,000 or 24% to $12,613,000 in the first
six months of fiscal 1997. Sales in the Uranium Services & Recycle industry
segment decreased by $2,174,000 or 56%. The decrease in the Uranium Services
& Recycle industry segment was due primarily to decreased production volumes
of depleted uranium. Sales in the Specialty Metal Products industry segment
decreased by $840,000 or 10%, due to decreased sales of beryllium products.
Sales in the Penetrator segment decreased by $1,065,000 or 17%, mainly due to
lower large caliber sales.
Gross profit increased by $731,000 or 22% to $4,025,000. As a percentage
of sales, gross profit was 32% as compared to 20% for the first six months of
fiscal 1996. The increase in gross profit was primarily the result of a
reduction of reserve requirements for certain site remediation costs of
$670,000, reduction of inventory reserves of $650,000, and recognition of
$280,000 of revenue during second quarter of fiscal 1997 that had been
previously deferred. This was partially offset by start-up costs on the first
production orders for Beralcast-Registered Trademark-, NMI's patented
lightweight material during fiscal 1997.
Selling, general and administrative expenses increased by $138,000 or 6%
as compared to the first six months of fiscal 1996. As a percentage of
sales, selling, general and administrative expenses increased to 21%, as
compared to 15% for the same period a year earlier.
Other income decreased by $59,000 to $11,000, compared to $70,000 for the
same period in fiscal 1996. This decrease was primarily due to lower amounts
available for investment.
Interest expense decreased by $93,000 to $119,000 from $212,000 for the
same period a year earlier.
Income taxes during the first six months of fiscal 1997 and 1996 were at
an effective rate of 2% net of approximately $11,000 of income tax refunds
received in the first six months of fiscal 1996. The Company has significant
unrecognized net operating loss carryforwards resulting in a minimal
effective tax rate.
-9-
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
Working capital at the end of the first six months of fiscal 1997 was
$9,949,000, a increase of $700,000. Cash and investments at the end of the
six month period were $448,000, a decrease of $852,000. The decrease in cash
is primarily a function of applications to line of credit balances to reduce
interest expense.
Capital spending will continue in support of facilities both in Concord,
Massachusetts and at Carolina Metals, Inc., the Company's Barnwell, South
Carolina subsidiary. The Company anticipates that this will require
$1,057,000 during fiscal 1997.
-10-
<PAGE>
PART II
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits:
27 Financial Data Schedule
10A Envirocare of Utah, Inc. Low-Activity Radioactive waste
disposal agreement
10B Amendment of Solicitation/Modification of contract date
March 10, 1997 issued by the Department of the Army
b. Reports on Form 8-K: The Company did not file any reports on Form 8-K
during the second quarter ended March 31, 1997.
-11-
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
Nuclear Metals, Inc.
By /s/ Robert E. Quinn
----------------------------------------------------------
Robert E. Quinn, President
Chief Executive Officer
Date May 15, 1997
----------------------------------------------------------
By /s/ James M. Spiezio
----------------------------------------------------------
James M. Spiezio, Vice President, Finance & Administration
Chief Financial Officer
Date May 15, 1997
----------------------------------------------------------
By /s/ Rebecca L. Perry
----------------------------------------------------------
Rebecca L. Perry, Controller
Chief Accounting Officer
Date May 15, 1997
----------------------------------------------------------
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<PAGE>
[Letterhead of Envirocare
of Utah, Inc.]
ENVIROCARE OF UTAH, INC.
LOW-ACTIVITY RADIOACTIVE WASTE
DISPOSAL AGREEMENT
THIS AGREEMENT made and entered into as of this 29 day of December,
1989, by and between NUCLEAR METALS, INC., having its general offices at 2229
Main Street, Concord, Massachusetts 01742 (hereinafter called "Customer"),
and ENVIROCARE OF UTAH, INC., a Utah corporation, having its general offices
at 215 South State Street Suite 1160, Salt Lake City, Utah 84111 (hereinafter
called "Disposer").
WITNESSETH:
WHEREAS, Customer has certain quantities of waste materials as listed and
described in Exhibit "A", attached hereto and made a part hereof (hereinafter
called "Waste Material"), and desires to have Disposer receive and dispose of
such material at its Clive, Utah, waste disposal facility (hereinafter called
"The Facility"), which has been duly licensed by the State of Utah for receipt
and disposal of such waste, and
WHEREAS, attached hereto, reviewed by Customer, and made a part hereof is
Disposer's license #UT2300249 issued by the State of Utah, together with
amendments thereto which restrict the license and amendments thereto which
expand the license to permit Disposer to handle the Waste Material which is the
subject of this Agreement; and
WHEREAS, Disposer understands the toxic nature and the radioactive
characteristics of the Waste Material, as described in Exhibit "A" and is
willing to receive, handle, store, and dispose of the Waste Material in
accordance with Disposer's license, and other permit(s) or authorization(s)
granted pursuant to applicable governmental laws, rules, regulations,
ordinances, actions and requests (hereinafter referred to as "Regulations");
NOW, THEREFORE, in consideration of the payments to be made by Customer to
Disposer, as herein provided, and the mutual covenants and agreements herein
contained, Customer hereby engages Disposer and Disposer hereby agrees to
receive, handle, store, and dispose of the Waste Material described in Exhibit
"A" upon the terms and conditions hereinafter set forth.
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<PAGE>
1. WASTE MATERIAL. The Waste Material to be disposed of under this
Agreement shall be only of the type and quantities set forth in Exhibit "A",
which is attached hereto and by reference made a part hereof. The Customer shall
commence shipment or delivery of the Waste Material to the Disposer only if said
material conforms in every material respect to the description contained in
Exhibit "A", and complies in every material respect with Disposer's license and
other permit(s) or authorization(s) granted pursuant to the Regulations.
Customer shall not mix or otherwise combine the Waste Material with any
other material or products from any other party or source, nor present the same
for receipt by Disposer.
All Waste Material shall be __________________________________ when it
arrives at The Facility as determined by the Standard Proctor Method.
Customer shall execute properly and in full and deliver to Disposer the
Radioactive Waste Shipment and Disposal Record Form, the Waste Profile Record
Form, the Radiological Evaluation Form and the Physical Properties Evaluation
Form submitted by Disposer. Disposer shall rely on the information and data set
forth in said forms, and Customer represents and warrants that said information
and data is true and correct in all respects and is in accordance with all
applicable Regulations.
2. NONCONFORMING WASTE MATERIAL. The Disposer shall have no obligation to
receive, handle, store, or dispose of any waste material delivered at The
Facility which does not in fact conform to and/or comply with Disposer's license
and the Regulations. Upon discovering any nonconformity or noncompliance, the
Disposer will give written notification to Customer. Disposer, at its sole
option: (1) may remove or cause any nonconforming waste material to be removed
and returned to Customer or (2) may demand that the Disposer remove or cause the
material to be removed as soon as reasonably possible. All costs, expenses
and/or fees for or resulting from the preparation for removal and/or removal of
the material, including analysis and handling of the same, shall be paid by
Customer without regard to whether removal is made or caused to be made by
Disposer or by Customer. All costs, expenses and fees in transporting and in
preparing to transport the material from The Facility shall be paid by Customer.
If Disposer arranges for return of the material to Customer, the material shall
be transported to Customer by such means of transportation as Disposer shall
select.
-2-
<PAGE>
3. TRANSPORTATION AND DELIVERY. Customer shall transport and deliver the
Waste Material or cause it to be transported and delivered to The Facility in
the manner and pursuant to the schedule specified in Exhibit "B", which is
attached hereto and by reference made a part hereof. The Waste Material shall be
transported and delivered only in accordance with Exhibit "B" in "strong tight"
containers as defined by 49 CFR 173 and approved by Disposer in writing before
loading and shipment and in accordance with the Regulations. Disposer shall have
no responsibility for arranging for, scheduling, or transporting the said
material.
The Customer shall notify Disposer in writing of each shipment ___________
prior to arrival of the shipment at The Facility.
If the loaded vehicles and/or containers do not pass Disposer's inspection,
Disposer shall give written notification to Customer, and Customer shall
promptly remove the same from The Facility. under no circumstances shall such
vehicles and/or containers be deemed or treated as accepted merely because the
same are located on The Facility.
Customer shall deliver the Waste Material at The Facility
_________________________________________. If delivery arrives after
_____________________________________________.
Disposer shall unload and release transporting vehicles and containers in a
timely fashion. If after unloading, Disposer determines that the vehicles and/or
containers are contaminated, Disposer shall give written notification to
Customer and Customer shall promptly arrange for the decontamination of the
vehicles and/or containers. Disposer shall perform the necessary decontamination
services, if Customer requests such services from Disposer, at the rate of
___________________________________________________.
Customer acknowledges that the lawful and timely disposal of the Waste
Material makes critical and vital the scheduling for delivery of the Waste
Material to, The Facility. Customer, therefore, shall deliver the Waste Material
at The Facility strictly according to the schedule set forth in Exhibit "B".
-3-
<PAGE>
4. PACKAGING. Customer shall be responsible for all packages and containers
and warrants their compliance with the requirements and specifications in
Exhibit "B", and with all rules, regulations, laws and/or ordinances which may
be applicable to the safety, packaging, storage or transportation of such
containers.
5. REPRESENTATIONS AND WARRANTIES.
CUSTOMER: Customer represents and warrants that (1) all Waste Material
delivered to Disposer shall conform in every material respect to the description
contained in Exhibit "A", (2) prior to delivery of the Waste Material to
Disposer, Customer shall have obtained all required permits and approvals for
shipment and delivery of the Material, (3) all vehicles, containers, packages,
or equipment used by Customer in the shipment, transportation, or delivery of
the Waste Material shall comply with all rules, regulations, laws, and/or
ordinances which may be applicable to the safety, packaging, storage or
transportation of such vehicles, containers, packages, or equipment, and (4)
Customer, and its officers, employees, and agents, shall comply with the site
regulations established by Disposer for The Facility and with all instructions
and/or regulations of the Utah Department of Health and/or other governmental
authority having jurisdiction over The Facility.
DISPOSER: Disposer represents and warrants that it shall perform its
services in compliance with the Regulations.
6. INDEMNIFICATION. Customer shall indemnify, defend and save harmless
Disposer, and Disposer's officers, employees, and agents, against any and all
liability whatsoever, including all costs, expenses, and/or attorneys fees,
which may arise out the breach of any representation or warranty of Customer
contained in paragraph 5 above. This indemnification by the Customer is made
notwithstanding the provisions of paragraph 8, and is not diminished or limited
in any way by the said paragraph.
Disposer shall indemnify, defend and save harmless Customer, and Customer's
officers, employees, and agents, against any and all liability whatsoever,
including all costs, expenses, and/or attorneys fees, which may arise out of the
breach of any representation or warranty of Disposer contained in paragraph 5
above.
-4-
<PAGE>
7. PAYMENT. In consideration of the receipt, handling, storage, and
disposal of the Waste Material, Customer shall make payment to Disposer
at the rates and prices set forth in Exhibit "C", which is attached hereto and
by reference made a part hereof, plus any and all __________________________
_______________________________ and ________________________________________
which are in effect as of the date the Waste Material is disposed of at The
Facility or are placed in effect subsequent to such date.
Measurement of the Waste Material shall be made by Disposer at any time
prior to disposal and Disposer's measurements shall be conclusive.
Disposer shall submit appropriate invoices to customer and shall keep
copies of said invoices for a period of at least two years as a record of
disposal. All invoices shall be due and payable by Customer upon receipt.
___________________________________________________________________________. If
Customer defaults in its payment obligations under this Agreement, it shall make
payment to Disposer of all costs, expenses, and attorney fees, incurred by
Disposer in effecting collection of said amounts. Failure to pay invoices when
due shall constitute a material breach of this Agreement.
Notwithstanding any language to the contrary contained herein, if Customer
is in default of this Agreement Disposer may, at its sole election, (1) waive
any such default on such terms as Disposer shall determine, including, but not
limited to, accepting Waste Material from Customer on a prepaid basis; (2)
suspend further performance by Disposer under this Agreement; or (3) declare
Customer in default of this Agreement.
8. TITLE TO WASTE MATERIAL. Upon the Disposer accepting and taking
possession at The Facility of Waste Material conforming to the description in
Exhibit "A", title, risk of loss, and all other incidents of ownership to the
material shall thereupon transfer from Customer and shall be held by Disposer.
Customer shall upon request by Disposer, sign and deliver to Disposer on its
approved form, a bill of lading to all such material so delivered. Customer
shall have no right to recovery of any material contained in the Waste Material
nor any credit for its potential value. Customer shall nevertheless remain
obligated in accordance with paragraph 2 above with regard to removal from The
Facility of Waste Material.
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<PAGE>
9. INSURANCE. Envirocare of Utah shall take out and maintain, at its
expense, during the term of this Agreement at least the following insurance with
respect to Disposer's ownership and operation of The Facility:
COVERAGE LIMITS
(a) Workman's compensation
(b) Employer's Liability
(c) Public Liability
(Bodily Injury)
(d) Public Liability
(Property Damage)
(e) Automotive Liability
(Bodily Injury)
(f) Automotive Liability
(Property Damage)
10. FORCE MAJEURE. The performance of this Agreement, except for the
payment of money owing for services actually rendered hereunder, may be
suspended by either party in the event of national defense requirements, any act
of God, war, riot, fire, explosion, accident, flood, sabotage, or lack of
adequate fuel, power, raw materials, labor, containers or transportation
facilities, or noncompliance by the other party with governmental requirements,
laws, regulations, orders or actions, or because of breakage or failure of
machinery or apparatus, or in the event of labor trouble, strike, lockout or
injunction (provided that neither party shall be required to settle a labor
dispute against its own best judgment), or any other event beyond the reasonable
control of such party, which event prevents the delivery, transportation,
acceptance or disposal of the Waste Material.
11. INDEPENDENT CONTRACTOR. Customer and Disposer are each separate
entities. Neither of them, nor their employees or agents, shall be deemed to be
employees or agents of the other of them and their subcontractors are
independent agents for all purposes and at all times.
12. WAIVER. Any waiver by either party of the breach of any provision or
condition of this Agreement shall not be construed or deemed to be a waiver of a
subsequent breach of the same provision or condition, unless such waiver be
expressed in writing and signed by the party to be bound.
-6-
<PAGE>
13. NOTICE. Any notice, communication or statement required or permitted to
be given hereunder shall be in writing and deemed to have been sufficiently
given when delivered in person or by registered or certified mail, postage
prepaid, return receipt requested, or by telefax machine addressed as follows:
CUSTOMER: Nuclear Metals, Inc.
2229 Main Street
Concord, Massachusetts 01742
Telefax # (508) 369-5410 ext. 500
DISPOSER: Envirocare of Utah, Inc.
215 South State Street, Suite 1160
Salt Lake City, Utah 84111
Attention: Mr. Khosrow B; Semnani
Telefax # (801) 537-7345
or at such other address as a party shall hereafter, in writing, direct.
14. TERMINATION. Either party may terminate this Agreement by notice in
writing in the event that the other party makes an assignment for the benefit
of creditors; or admits in writing inability to pay debts as they mature; or
a trustee or receiver of the other or of any substantial part of the other's
assets is appointed by any court; or a proceeding is instituted under any
provision of the Federal Bankruptcy Code by the other or against the other,
and is acquiesced in or is not dismissed within 60 days, or results in an
adjudication in bankruptcy.
15. CONFIDENTIALITY. The parties shall treat as confidential property
and not disclose to others during or subsequent to the term of this
Agreement, except as is necessary to perform this Agreement hereunder and
then only on a confidential basis satisfactory to both parties, and
information, including technical information, experience or data, regarding
the other party's plans, programs, plants, processes, products, disposal
costs, equipment, operations, customers and/or the specific contractual terms
contained herein which may come within the knowledge of the parties, their
officers or their employees in the performance of this Agreement without in
each instance securing the prior written consent of the other party. Disposer
shall also treat as confidential and shall not disclose to other, except as
-7-
<PAGE>
required by law, governmental rules, regulations and/or orders, information
relating to the composition of the Waste Material and/or the quantity of
Waste Material delivered to it by Customer. Nothing herein, however, shall
prevent either Disposer or Customer from disclosing to others or using in any
manner information which either party can show:
(a) Has been published and become part of the public domain other than by
acts, omissions, or fault of Disposer or Customer or their employees.
(b) Has been furnished or made known to Disposer or Customer by third
parties other than those acting directly or indirectly for or on
behalf of Customer or Disposer as a matter of legal right without
restriction against disclosure.
(c) Was in the other party's possession prior to the disclosure thereof
by Customer or Disposer to each other.
16. SURVIVAL. The representations, warranties, covenants, and agreements
made herein shall survive expiration and/or termination of this Agreement.
17. AMENDMENT/ASSIGNMENT. This Agreement may be amended or assigned only by
the written agreement of the parties.
18. BINDING. This Agreement shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective successors and permitted
assigns.
19. DEFAULT. In the event any party to this Agreement defaults in any of
the covenants or agreements contained herein, the defaulting party shall pay all
costs and expenses, including reasonable attorney's fees, incurred by the other
party in enforcing its rights arising hereunder.
20. APPLICABLE LAW. This Agreement is entered into in the County of Salt
Lake, State of Utah, shall be performed in the County of Tooele, State of Utah,
and shall be governed and construed in accordance with the laws of the State
of Utah. This Agreement is a contract for services, and passage to Disposer of
-8-
<PAGE>
title to Waste Material shall not cause the transaction to be characterized as
a sale of goods.
21. HEADINGS AND PARAGRAPH NUMBERS. Headings and paragraph numbers have
been inserted herein solely for convenience and reference and shall not be
construed to affect the meanings, construction or effect of this Agreement.
22. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which may be executed by less than all of the parties
hereto, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
23. SEVERABILITY. In the event that any provision of this Agreement becomes
or is declared by a court of competent jurisdiction to be illegal, unenforceable
or void, the Agreement shall continue in full force and effect without the said
provision; provided that no such severability shall be effective if it
materially changes the economic benefit of this Agreement to any party.
24. ENTIRE AGREEMENT. This Agreement constitutes the full and entire
understanding and agreement between the parties hereto, and supersedes any
language, term, condition, or other provision of any prior written materials,
including any request for proposal, and any oral communications between the
parties.
IN WITNESS WHEREOF, Disposer and Customer have been caused this Agreement
to be executed by its duly authorized representative(s) on the day and year set
forth below.
ENVIROCARE OF UTAH, INC. NUCLEAR METALS, INC.
By /s/ Khosrow Semnani By /s/ R. B. MacKay /s/ A.R. Gilman
----------------------------- -----------------------------------------
Title President Title V.P., Operations/V.P. Health/Safety
Date signed 2-20-90 Date signed 12-29-89
-------------------- --------------------------------
(DISPOSER) (CUSTOMER)
-9-
<PAGE>
EXHIBIT "A"
NUCLEAR METALS, INC.
DESCRIPTION OF THE WASTE MATERIAL
The Waste Material to be disposed of is as follows:
as approved by the ___________________________________________________
_______________ (a copy attached) in response to the information provided by
Customer describing the waste material.
Any post-delivery adjustment ________ which is required by Disposer pursuant
to paragraph 1 of this Disposal Agreement will be performed by Disposer at
Customer's expense as provided in Exhibit "C" of this Disposal Agreement.
-10-
<PAGE>
EXHIBIT "B"
NUCLEAR METALS, INC.
DELIVERY SCHEDULE
The Waste Material shall be delivered to the facility no later than December
31, 1990 in quantities which may total less but not more than ___________.
The Waste Material shall be shipped and delivered in __________.
____________________________________________________________________ Shipment
shall be by ________________________________________________. "Exclusive use"
service shall be employed. Customer may, at its option, elect an alternative
method of transportation of the Waste Material conditional upon it first
obtaining the written agreement of Disposer as to such alternative
transportation method and as to the price to be paid to Disposer for receipt
and handling of said material pursuant to that alterative method. If Customer
and Disposer agree to an alternative method of transportation, this Exhibit
"B" shall thereupon be amended to reflect the agreement as to the alternative
method. The Waste Material shall be delivered at such times and frequency as
specifically set forth in written notice which Customer shall give to
Disposer not less than thirty (30) days prior to delivery of the first
shipment to The Facility.
-11-
<PAGE>
EXHIBIT "C"
NUCLEAR METALS, INC.
PRICE SCHEDULE
The following charges will apply to Waste Material described in Exhibit "A"
which meets each of the requirements of this Agreement:
If the delivery schedule requires The Facility to operate _______________
___________, an additional charge of _________________________________
______________________ shall be added to the disposal charges given above.
-12-
<PAGE>
FIRST ADDENDUM
TO
DISPOSAL AGREEMENT DATED DECEMBER 29, 1989, BETWEEN NUCLEAR METALS,
INC. ("CUSTOMER") AND ENVIROCARE OF UTAH, INC. (DISPOSER")
R E C I T A L S
1. Disposer has not received to date any Waste Material from the Customer
(as defined in Exhibit "A" to the Disposal Agreement dated December 29, 1989),
pursuant to the Disposal Agreement.
2. Customer and Disposer desire to amend the Disposal Agreement in the
particulars hereinafter provided.
NOW THEREFORE, it is agreed as follows:
1. Customer and Disposer agree the Waste Material shall be delivered to
The Facility no later than December 31, 1991 _______, pursuant to the terms
of the Disposal Agreement as modified by this first Addendum to Disposal
Agreement.
2. For the term of the Disposal Agreement and this First Addendum to
Disposal Agreement, Disposer shall receive, handle, store and dispose of the
Additional Waste Material from the Customer at the disposal rate outlined below:
EXHIBIT "C"
NUCLEAR METALS, INC.
PRICE SCHEDULE
The following charges will apply to all Waste Material (as defined in
Exhibit "A" to the Disposal Agreement) delivered by Customer to Disposer
which meets each of the requirements of this Agreement:
<PAGE>
If the delivery schedule requires the Facility to operate _____________ an
additional charge of _________________________________________________________
shall be added to the disposal charges given above.
If Waste Material _____________________, an additional charge of
________________________________________________________________________________
shall be added to the disposal charges given above.
4. All terms and provisions of the Disposal Agreement remain in full force,
effect and unchanged except as hereinabove specifically provided.
THIS AGREEMENT made this eighteenth day of January, 1991.
ENVIROCARE OF UTAH, INC. NUCLEAR METALS, INC.
By: /s/ Khosrow Semnani By: /s/ R. B. MacKay /s/ A. R. Gilman
----------------------------- ----------------------------------------
Title: President Title: V.P., Operations V.P. Safety
Date Signed: February 25, 1991 Date Signed: January 31, 1991
---------------------------- -------------------------------
<PAGE>
SECOND ADDENDUM
TO
DISPOSAL AGREEMENT DATED DECEMBER 29, 1989, BETWEEN NUCLEAR METALS, INC.,
("CUSTOMER") AND ENVIROCARE OF UTAH, INC., ("DISPOSER").
RECITALS:
1. Disposer has received from the Customer approximately _______ of Waste
Material (as defined in Exhibit A to the Disposal Agreement dated December
29, 1989, pursuant to the Disposal Agreement.
2. By First Addendum dated January 18, 1991, Customer and Disposer
amended said Disposal Agreement and now desire to further amend the Disposal
Agreement in the particulars hereinafter provided.
NOW THEREFORE, it is agreed as follows:
1. This Second Addendum replaces and is executed in substitution of the
First Addendum dated January 18, 1991.
2. Customer and Disposer agree that Disposer will receive, within the time
as herein provided and will handle, store and dispose of additional Waste
Material, i.e. Waste Material _____________________________________ received
from the Customer. Said additional waste material (hereinafter "Waste Material")
shall be so received, handled, stored and disposed of pursuant to the terms of
the Disposal Agreement and this Second Addendum to Disposal Agreement.
3. FIRST/LAST SHIPMENT: The first shipment of Waste Material shall
arrive at the Facility before January 31, 1992. The last shipment shall
arrive at the Facility before December 31, 1994.
4. For the term of the Disposal Agreement and this Second Addendum,
Disposer shall receive, handle, store and dispose of the Waste Material
contemplated by this Second addendum at the rates outlined below:
5. Notwithstanding the terms of the Disposal Agreement and this Second
Addendum, Disposer does reserve the right to refuse to accept all or any
portion of the Waste Material contemplated by this Second Addendum in the
event, conditional upon, and to the extent that any governmental agency or
other authority having jurisdiction for the regulation or oversight of The
Facility, including, but not limited to, the State of Utah and the Northwest
Interstate Compact Committee, directs or requires that Disposer not accept
delivery of said Waste Material at The Facility.
6. The following charges will apply to all Waste Material (as defined in
Exhibit "A" to the Disposal Agreement) contemplated by this Second Addendum
and delivered by Customer to Disposer and which meets each of the
requirements of this Agreement:
<PAGE>
If the delivery schedule requires the Facility to operate ____________, an
additional charge of ____________ shall be added to the disposal charges
given above.
If Waste Material ________________, an additional charge of ______________
shall be added to the disposal charges given above.
7. All terms and provisions of the Disposal Agreement remain in full
force, effect and unchanged except as hereinabove specifically provided.
THIS AGREEMENT made this eleventh day of November, 1991.
ENVIROCARE OF UTAH, INC. NUCLEAR METALS, INC.
By: /s/ Khosrow Semnani By: /s/ R.B. MacKay
-------------------------- --------------------------
Title: President Title: V.P., Operations
----------------------- ------------------------
Date Signed: 12/2/91 Date Signed: November 22, 1991
----------------- ------------------
NUCLEAR METALS, INC.
By: /s/ A. R. Gilman
--------------------------
Title: V.P. Health/Safety
-----------------------
Date Signed: November 22, 1991
------------------
<PAGE>
THIRD ADDENDUM
TO THE
DISPOSAL AGREEMENT DATED DECEMBER 29, 1989, BETWEEN
NUCLEAR METALS, INC. ("CUSTOMER")
AND ENVIROCARE OF UTAH, INC., ("DISPOSER")
RECITALS
1. Disposer has received from the Customer as of January 31, 1995
approximately ____________ of Waste Material (as defined in Exhibit "A"
to the Disposal Agreement dated December 29, 1989.
2. Customer and Disposer desire to amend the Disposal Agreement in the
particulars hereinafter provided.
NOW THEREFORE, it is agreed as follows:
1. Paragraph one (1) is amended extending the time during which the
last shipment of Waste Material may arrive at The Facility to July 31, 1995.
2. Disposer shall accept and dispose of __ constituting of __________.
The disposal cost for said ___ shall be _________________ will be figured at
___________________.
3. All terms and provisions of the Disposal Agreement and previous
Addendums remain in full force, effect and unchanged except as hereinabove
specifically provided.
THIS AGREEMENT made this 22nd day of March, 1995.
ENVIROCARE OF UTAH, INC. NUCLEAR METALS, INC.
By: /s/ Charles A. Judd By: /s/ Frank J. Vumbaco
------------------------- -------------------------
Charles A. Judd
Title: Vice President Title: VP Health & Safety
---------------------- ----------------------
Date Signed: 5/2/95 Date Signed: 3/23/95
---------------- -----------------
<PAGE>
FOURTH ADDENDUM
TO THE
DISPOSAL AGREEMENT DATED DECEMBER 29, 1989, BETWEEN
NUCLEAR METALS, INC. ("CUSTOMER")
AND ENVIROCARE OF UTAH, INC. ("DISPOSER")
RECITALS
1. Disposer has received from the Customer as of July 31, 1995,
approximately __________ of Waste Material (as defined in Exhibit "A" to
the Disposal Agreement dated Dated December 29, 1989.
2. Customer and Disposer desire to amend the Disposal Agreement in the
particulars hereinafter provided.
NOW THEREFORE, it is agreed as follows:
1. Paragraph one (1) is amended extending the time during which the last
shipment of Waste Material may arrive at The Facility to December 31, 1996.
2. Disposer shall accept and dispose of all waste material at a
disposal cost of ______________.
3. All terms and provisions of the Disposal Agreement and previous
Addendums remain in full force, effect and unchanged except as hereinabove
specifically provided.
THIS AGREEMENT made this 16th day of August 1995.
ENVIROCARE OF UTAH, INC. NUCLEAR METALS, INC.
By: /s/ Charles A. Judd By: /s/ Frank J. Vumbaco
------------------------- -------------------------
Charles A. Judd
Title: Vice President Title: VP Health & Safety
---------------------- ----------------------
Date Signed: 9/21/95 Date Signed: 8/25/95
---------------- ----------------
<PAGE>
FIFTH ADDENDUM
TO THE
DISPOSAL AGREEMENT DATED DECEMBER 29, 1989, BETWEEN
NUCLEAR METALS, INC., ("CUSTOMER")
AND ENVIROCARE OF UTAH, INC. ("DISPOSER")
RECITALS
1. Carolina Metals, Inc. is a wholly-owned subsidiary of Customer
2. Customer desires that Carolina Metals, Inc. be added as a
wholly-owned subsidiary and a party to the Disposal Agreement.
2. Customer and Disposer desire to amend the Disposal Agreement in the
particulars hereinafter provided.
NOW THEREFORE, it is agreed as follows:
1. The first sentence is amended to read as follows: THIS AGREEMENT
made and entered into as of this 10th day of June, 1996, by and between
NUCLEAR METALS, INC., having its general offices at 2229 Main Street,
Concord, Massachusetts 01742, its wholly-owned subsidiary, CAROLINA METALS,
INC. having its general offices at P.O. Box 1366, Highway 80, Barnwell, South
Carolina 29812 (hereinafter called "Customer"), and ENVIROCARE OF UTAH, INC.,
a Utah corporation, having its general offices at 46 West Broadway, Suite
240, Salt Lake City, Utah 84101 (hereinafter called "Disposer").
2. Paragraph 13 is amended to add: CUSTOMER: Carolina Metals, Inc.
P.O. Box 1366
Highway 80
Barnwell, South Carolina
29812
3. All terms and provisions of the Disposal Agreement and previous
Addendums remain in full force, effect and unchanged except as hereinabove
specifically provided.
THIS AGREEMENT made this 7th day of June, 1996.
ENVIROCARE OF UTAH, INC. NUCLEAR METALS, INC.
By: /s/ Charles A. Judd By: /s/ Frank J. Vumbaco
------------------------- -----------------------------------
Charles A. Judd Frank J. Vumbaco
Title: Vice President Title: Vice President, Health & Safety
---------------------- --------------------------------
Date Signed: 6/18/96 Date Signed: June 10, 1996
---------------- --------------------------
<PAGE>
SIXTH ADDENDUM
TO THE
DISPOSAL AGREEMENT DATED DECEMBER 29, 1989, BETWEEN
NUCLEAR METALS, INC., ("CUSTOMER")
AND ENVIROCARE OF UTAH, INC. ("DISPOSER")
RECITALS
Customer and Disposer desire to amend the Disposal Agreement in the
particulars hereinafter provided.
NOW THEREFORE, it is agreed as follows:
1. Paragraph 1 is amended extending the time during which the last
shipment of Waste Material may arrive at The Facility _______________________ .
2. The attached SCHEDULE "C-1" is added to the Disposal Agreement.
3. All terms and provisions of the Disposal Agreement and previous
Addendums with the exception of item 2 of the Fourth Addendum remain in full
force, effect and unchanged except as herein specifically provided.
THIS AGREEMENT made this nineteenth day of September 20, 1996.
ENVIROCARE OF UTAH, INC. NUCLEAR METALS, INC.
By: /s/ Charles A. Judd By: /s/ James M. Spiezio
------------------------- -------------------------
Charles A. Judd
Title: Vice President Title: VP Finance
---------------------- ----------------------
Date Signed: 9/20/96 Date Signed: 9/20/96
---------------- ----------------
<PAGE>
SCHEDULE "C-1"
(Disposal Only)
PRICE SCHEDULE
NUCLEAR METALS, INC
The following conditions and charges apply to the Waste Material to be
delivered for disposal and which meets each of the requirements of this
Agreement:
Customer represents that it will deliver ____________ of Waste Material
to The Facility. Customer represents that the Waste Material is
_______________ . Customer represents that ___________________________ Waste
Material will be delivered to The Facility _______________________. Disposer
will invoice Customer at the rate of ____________ for disposal of the ________
Waste Material.
This Agreement is made by Envirocare in partial consideration of
assurances given by Customer that Waste Material will be ____________
_____________. Customer will insure that a ________________ of Waste Material
will be delivered to The Facility ____________________.
In the event Customer has not ______________ as stated above
______________, Disposer will invoice Customer at a rate of ______________
for all Waste Material delivered.
Disposer will make all reasonable efforts to insure that all of the Waste
Material is acceptable for disposal. The amount of any specific Waste
Material found __________________________________________. In the event that
the total ________ delivered is ________________, then after the last
shipment arrival date provided in paragraph 1 of the Agreement, Envirocare
shall invoice Customer __________________________. Said invoice shall be due
and payable by Customer as provided in paragraph 9 of the Agreement.
No more than ______________ of Waste Material shall be disposed at The
Facility for Customer under this schedule.
MEASUREMENT OF WASTE MATERIAL. For payment purposes, volume or weight
measurement of the Waste Material shall be made by Envirocare at any time prior
to treatment or disposal, and Envirocare's measurements shall be conclusive.
If the delivery schedule requires The Facility to operate
_______________, an additional charge of _______________________ shall be
added to each applicable disposal charge.
For any Waste Material which _________________, an additional charge of
____ shall be added to each applicable disposal charge for that particular
Waste Material.
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT 1. CONTACT ID CODE PAGE OF PAGE
1 19
________________________________________________________________________________________________________________________________
4. AMENDMENT/MODIFICATION NO. 5. EFFECTIVE DATE 6. REQUIREMENT/PURCHAS REG. NO. PROJECT NO. (If applicable)
P00010 03/06/97 2p7AAQ-421A-MOD1
- -----------------------------------------------------------------------------------------------------------------------------------
6. ISSUED BY CODE M15gkm03 7. ADMINISTERED BY (if other than hand) CODE 22206a
---------------- ------------
DEPARTMENT OF ARMY DCMAO BOSTON
AMS1A-AR-PC-A B,10 495 SUMMER STREET
PICATTNY ARSENAL NJ 07206 BOSTON MA 02210-2184
L. Ketter 205(201) 724-4771
- -----------------------------------------------------------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., county, State and Zip Code) Vender ID: 0-0004845 DQ 8a. AMENDMENT OF SOLICITATION NO.
NUCLEAR METALS INC.
2229 MAIN STREET 9b. DATED (SEE ITEM 11)
CONCORD MA 01742 10a. MODIFICATION OF ADMINISTRATION NO.
X DAAK10-81-C-0323
10b. DATED (SEE ITEM 13)
- -----------------------------------------------------------------------------------------------------------------------------------
CODE 78465 FACILITY CODE
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/ / The above numbered solicitation is amended as set forth in Item 14. The
hour and date specified for receipt of Offer: / / is extended, / / is not
extended, Offers must acknowledge receipt of this amendment prior to the hour
and date specified in the solicitation as amended, by one of the following
methods: (a) By completing Items 8 and 15, and returning copies of
the amendment; (b) By acknowledging receipt of this amendment on each copy
of the offer submitted; or (c) By separate letter or telegram which includes
a reference to the solicitation and amenment nubmers. FAILURE OF YOUR
ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF
OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR
OFFER. If by virtue of this amendment you desire to change and offer already
submitted, such change may be made by telegram or letter, provided each
telegram or letter makes reference to the solicitation and this amendment,
and be received prior to the opening hour and date specified.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
<S> <C>
13. ACCOUNTING AND APPROPRIATION DATA (if required) Obligated Amount US $6,525,979.00
See Attached.
- ---------------------------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OR CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- ---------------------------------------------------------------------------------------------------
(X) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: By authority: THE CHANGES SET FORTH IN ITEM 14 ARE
- ----- MADE IN THE CONTRACT ORDER NO.
- ---------------------------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such
as changes in paying officer, appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO
THE AUTHORITY OF FAR 29, 100
- ---------------------------------------------------------------------------------------------------
x C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
---------------------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- ---------------------------------------------------------------------------------------------------
E. IMPORTANT: Contractor / / is not, /x/ is required to sign this document and return 2 copies
to the issuing office. ---
- ---------------------------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT MODIFICATION (Organized by UCF section headings, including
modifications/contracts were feasible.)
See attached continuation sheet.
Any attempt as provided herein, all terms and conditions of this reference and in full
force and effect.
- ---------------------------------------------------------------------------------------------------
14A. NAME AND TITLE OF SIGNER (Type or print) 14B. NAME AND TITLE OF CONTRACTING
OFFICER (Type of
/s/ Donald T. King, Mgr. Sales & Contracts Harry Santa
- ---------------------------------------------------------------------------------------------------
15A. CONTRACTOR/ 15C. DATE SIGNED 15C. UNITED STATES OF AMERICA 15D. DATE
SIGNED
/s/ Donald T. King 3/10/97 or /s/ Harry Santa 10 Mar 97
- ---------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Page 1A of 19
DAAKIO-81-C-0323
Modification P00010
SUPPLIES OR SERVICES AND PRICES/COSTS
ITEM DESCRIPTION QUANTITY U/I UNIT PRICE AMOUNT
- ---- ----------------------------------- -------- --- -------------- ------------
<S> <C> <C> <C> <C> <C>
0001 This line covers the basic contract 1.00 EA 7317996.000000 7,317,996.00
and mods up to P00009.
PR Number: PreAud-****-0197
0009 PR Number: 2P7AA0-421A-MG01 1.00 EA 6525979.000000 6,525,979.00
</TABLE>
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 2 OF 19
MODIFICATION P00010
The purpose of the Modification is to incorporate the attached Army Contract
Adjustment Board Memorandum of Decision No. 1244, dated 13 Sep 1996 and
implement same by a Supplement Agreement, the terms of which are as follows:
A. The Government shall pay the Contractor a firm fixed price of $6,525,979
for the Contractor to conduct all activities necessary for Decontamination &
Decommissioning (i.e. treat, excavate, transport, bury and otherwise cleanup) of
the Holding Basin at Contractor's Concord facility as specified in the five
performance based milestones set forth in Paragraph D. It is the contractor's
responsibility to comply with all environmental laws, regulations, and
standards, and obtain all environmental permits necessary to do the remediation
effort. Execution of the Modification is implementation of an ACAB Decision and
does not constitute any admission of liability by either party. Cleanup of areas
other than the holding basin will be charged to appropriate overhead and/or G&A
pools in accordance the ACAB decision.
B. Period of Performance is as specified in Performance Milestones and
paragraph H.
C. The attached firm fixed price--services clauses are included in the
contract and made applicable to this modification. None of the cost type clauses
contained in the basic contract apply to this modification.
D. Payments shall be made as performance based payments in accordance with
FAR 52.232-32 and the performance schedule set forth below. Each of the
individual milestone payments will be paid in full when the US Army TACOM-ARDEC
is provided with documentation confirming full performance of each individual
milestone, and has been properly invoiced.
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 3 OF 19
MODIFICATION P00010
1. SUBMITTAL OF Decontamination & Decommissioning/Response
Action Measure for the Holding Basin to Army (30 calendar days
after contract award) $2,000,000.
2. Completion of enclosure construction/obtain equipment. 500,000.
3. Complete excavation and packaging of Basin Material in
accordance with D&D/RAM Plan. NMI is not authorized to
proceed, or to receive any payment under the provisions of
this Modification until it demonstrates and provides to the
Army proof that it has received regulatory approval of all of
the necessary cleanup, decommissioning, and decontamination
plans. The Contracting Officer may suspend payments in the
event NMI does not prepare or submit to regulatory agencies,
any required environmental analysis, environmental reports, or
other information required for regulatory agencies to take
approval action on D&D plans.
a. At the time 1,500 cubic yards of the basin material have
been removed and delivered to the rail site. Expected to
be on or about 15 Jul 97. NMI will provide documentary
evidence with its invoice that a sufficient number of
rail cars have been loaded to achieve a level of 1,500
cubic yards. 1,000,000.
b. At the time 1,500 cubic yards of the basin material have
been removed and delivered to the rail site (in addition
to the item 3.a material). Expected to be on or about 15
Aug 97. NMI will provide documentary evidence with its
invoice that a sufficient number of rail cars have been
loaded to achieve a level of 1,500 cubic yards. 1,000,000.
c. At the time 1,500 cubic yards of the basin material have
been removed and delivered to the rail site (in addition
to the item 3.a and 3.b material). Expected to be on or
about 15 Sep 97. NMI will provide documentary evidence
with its invoice that a sufficient number of rail cars
have been loaded to achieve a level of 1,500 cubic yards.
1,000,000.
NMI is not authorized to proceed on excavation until they have received
prior approval from the appropriate regulatory agencies of the
Decontamination and Decommissioning and Response Action Measure Plans
associated with the holding basin and provide evidence of same to the Army.
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 4 OF 19
<PAGE>
MODIFICATION P00010
4. D&D of basin enclosure certification from regulatory
agency. 250,000.
5. Provide Army with all necessary regulatory
acceptance/certification by Local, State and Federal Agencies
of confirmatory post basin site survey and release of NMI and
the US Army in accordance with regulatory criteria. NMI's
Preliminary Decommissioning Plan will be submitted to the Army
within 90 days after contract award. 775,979.
Total 6,525,979.
E. In consideration of the above, the Contractor agrees to waive, release,
indemnify and hold the Government harmless from any and all claims of any
kind related to existing contamination and/or waste at NMI's concord site,
including, but not limited to, any type of contract, environmental claims,
CERCLA claims, including claims based on being an arranger for disposal, or
an operator, or any claims of active or passive negligence by the Government
or its agents or employees but excluding only claims for decontamination and
disposal of government-furnished equipment maintained and identified under
facilities Contract No. DAAA09-90-E-0013 or any successor facilities
contract. Any and all violations or fines by any authority regarding the
presence, removal, or disposal of waste will be the responsibility of the
contractor.
F. Monthly letter reports and copies of any correspondence between NMI,
regulator or other government agencies (i.e. letters, document, reports,
studies, notices of meetings/ plans, etc.) (contractor format is acceptable)
are to be submitted to US Army, ARDEC, ATTN: Michael Los, AMSTA-AR-SRC,
Building 172, Picatinny Arsenal, NJ 07806-5000.
G. Stop Work Order clause (52.242-15) is amended to include: "should a stop
work order be issued, the contractor must make necessary safeguards at
holding basin and work area to preclude environmental damage during the
stoppage".
H. "Site-wide" environmental assessment plans approved by The Regulatory
Agency shall be completed and provided within 16 months of execution of this
modification. NMI's Preliminary Decommissioning Plan will be submitted to the
Army within 90 days after contract award.
Payment will be made by DFAS Columbus Center DFAS-CO/DPRO West Division, P.O.
Box 182511, Columbus, OH 43218-2225.
As a result of this modification, the contract is increased by $6,525,979.00
from $7,317,996.00 to $13,843,975.00.
All other terms and conditions remain unchanged.
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 5 OF 19
<PAGE>
MODIFICATION P00010
FIRM FIXED PRICE CLAUSES
------------------------
INSPECTION AND ACCEPTANCE:
- --------------------------
52.246-4 INSPECTION OF SERVICES- AUG 1996
FIXED-PRICE
52.242-15 STOP-WORK ORDER. (AUG 1989)
- -------------------------------------
(a) The Contracting Officer may, at any time, by written order to the
Contractor, require the Contractor to stop all, or any part, of the work
called for by this contract for a period of 90 days after the order is
delivered to the Contractor, and for any further period to which the parties
may agree. The order shall be specifically identified as a stop-work order
issued under this clause. Upon receipt of the order, the Contractor shall
immediately comply with its terms and take all reasonable steps to minimize
the incurrence of costs allocable to the work covered by the order during the
period of work stoppage. Within a period of 90 days after a stop-work order
is delivered to the Contractor, or within any extension of that period to
which the parties shall have agreed, the Contracting Officer shall either:
(1) Cancel the stop-work order; or
(2) Terminate the work covered by the order as provided in the Default, or
the Termination for Convenience of the Government, clause of this contract.
(b) If a stop-work order issued under this clause is canceled or the period
of the order or any extension thereof expires, the Contractor shall resume
work. The Contracting Officer shall make an equitable adjustment in the
delivery schedule or contract price, or both, and the contract shall be
modified, in writing, accordingly, if:
(1) The stop-work order results in an increase in the time required for, or
in the Contractor's cost properly allocable to, the performance of any part
of this contract; and
(2) The Contractor asserts its right to the adjustment within 30 days after
the end of the period of work stoppage; provided, that, if the Contracting
Officer decides the facts justify the action, the Contracting Officer may
receive and act upon a proposal submitted at any time before final payment
under this contract.
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 6 OF 19
MODIFICATION P00010
(c) If a stop-work order is not canceled and the work covered by the order is
terminated for the convenience of the Government, the Contracting Officer
shall allow reasonable costs resulting from the stop-work order in arriving
at the termination settlement.
(d) If a stop-work order is not canceled and the work covered by the order is
terminated for default, the Contracting Officer shall allow, by equitable
adjustment or otherwise, reasonable costs resulting from the stop-work order.
CONTRACT ADMINISTRATION DATA
- ----------------------------
PRON: 2P7AA0421ANG
ACCTG CLASS: 2172034 75H5H00P210 25CZ S28017
CONTRACTOR'S REMIT-TO ADDRESS FOR PAYMENT OF INVOICES
- -----------------------------------------------------
Payment shall be made to the remit-to address shown on the invoice as
authorized by the contractor.
CONTRACTORS INVOICES
- --------------------
Request for Payment: Submit Public Vouchers to the Finance Office FOUND IN
Block 6 of Standard Form 30 (Amendment of Solicitation/ Modification of
Contract)
ADDITIONAL INFORMATION
- ----------------------
Contract Specialist: Linda Kettler
Organization Code: AMSTA-AR-PC-C
Telephone Number: 201-724-4771
Facsimile Number: 201-724-4524 252-201-7000
CONTRACTING OFFICER'S REPRESENTATIVE. (DEC 1991)
- ------------------------------------------------
(a) "Definition. Contracting officer's representative" means an individual
designated in accordance with subsection 201.602-2 of the Defense Federal
Acquisition Regulation Supplement and authorized in writing by the
contracting officer to perform specific technical or administrative functions.
(b) If the Contracting Officer designates a contracting officer's
representative (COR), the Contractor will receive a copy of the written
designation. It will specify the extent of the COR's authority to act on
behalf of the contracting officer. The COR is not authorized to make any
commitments or changes that will affect price, quality, quantity, delivery,
or any other term or condition of the contract.
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 7 OF 19
MODIFICATION P00010
252.223-7001 HAZARD WARNING LABELS. (DEC 1991)
- ----------------------------------------------
(a) "Hazardous material," as used in this clause, is defined in the Hazardous
Material Identification and Material Safety Data clause of this contract.
(b) The Contractor shall label the item package (unit container) of any
hazardous material to be delivered under this contract in accordance with the
Hazard Communication Standard (29 CFR 1910.1200 "et seq"). The Standard
requires that the hazard warning label conform to the requirements of the
standard unless the material is otherwise subject to the labelling
requirements of one of the following statutes:
(1) Federal Insecticide, Fungicide and Rodenticide Act;
(2) Federal Food, Drug and Cosmetics Act;
(3) Consumer Product Safety Act;
(4) Federal Hazardous Substances Act; or\
(5) Federal Alcohol Administration Act.
(c) The Offeror shall list which hazardous material listed in the Hazardous
Material Identification and Material Safety Data clause of this contract will
be labelled in accordance with one of the Acts in paragraphs (b) (1) through
(5) of this clause instead of the Hazard Communication Standard. Any
hazardous material not listed will be interpreted to mean that a label is
required in accordance with the Hazard Communication Standard.
- ----------------------------------------
Material (if none, insert "none.") Act
- ----------------------------------------
- ---------------- ------------------
- ---------------- ------------------
- ----------------------------------------
(d) The apparently successful Offeror agrees to submit, before award, a copy
of the hazard warning label for all hazardous materials not listed in
paragraph (c) of this clause. The Offeror shall submit the label with the
Material Safety Data Sheet being furnished under the Hazardous Material
Identification and Material Safety Data clause of this contract.
(e) The Contractor shall also comply with MIL-STD-129, Marking for Shipment
and Storage (including revisions adopted during the term of this contract).
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 8 OF 19
MODIFICATION P00010
REQUIRED INSURANCE (WRITTEN IN PLAIN ENGLISH)
- ---------------------------------------------
Under FAR 52.228-5, in Section I, you must have the kinds and minimum amounts
of insurance in FAR 28.307-2.
SAFETY REQUIREMENTS FOR HAZARDOUS ITEMS (WRITTEN IN PLAIN ENGLISH)
- ------------------------------------------------------------------
a. The contractor shall use the safety data provided in the Hazardous
Component Safety Data Sheets (HCSDS) to insure the safe handling of the
energetic material. The HCSDS are in Section J of the contract.
b. The contractor shall comply with Paragraph F, Chapter 1 of DOD 4146.26M,
DOD Contractor's Safety Manual for Ammunition and Explosives. This requires
the contractor to submit all site and construction plans through the local
Defense Contract Management District Safety Office to the Contracting Officer
for approval. The contractor must also submit changes for approval.
Contractors will assure that their subcontractors follow the same procedures.
c. Whenever the contractor uses a government facility, he shall comply with
the local safety requirements of that facility.
d. The contractor must obtain written approval from the Contracting Officer
before the award of a subcontract involving explosives, propellants or
pyrotechnic materials. When the contractor requests the Contracting Officer's
approval, the Contracting Officer will arrange a Defense Logistics Agency
preaward safety survey for each subcontractor.
e. The contractor is responsible for decontaminating all facilities/equipment
at the end of the contract unless they intend to continue using the
facilities/equipment for similar purposes. You must include these costs
original contract. The contractor must provide the Contracting Officer with a
certification that you decontaminated all contaminated facilities/equipment.
f. The contractor is responsible for properly disposing of hazardous
materials during this contract. If disposal is done on the subcontractor's
site, the contractor must note this in his site plan per paragraph b. The
Contracting Officer must approve a subcontractor prior to him performing
disposal per paragraph d.
g. The contractor will provide reports of accidents/incidents as required by
Data Item DI-H- 1329A. The government reserves the right to investigate any
accident/incident under Chapter 2, Paragraphs F and G of DOD 4145.26M, DOD
Contractor's Safety Manual for Ammunition and Explosives.
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 9 OF 19
MODIFICATION P00010
GOVERNMENT CONTRACTOR RELATIONSHIPS (WRITTEN IN PLAIN ENGLISH)
- --------------------------------------------------------------
The Government and the Contractor agree that:
a. The Contractor will not perform or be paid for any personal services.
b. The Contractor or its employees will notify the Contracting Officer of
any suspected personal services prior to performance.
c. No employer-employee relationships will exist between the Government
and the Contractor or its employees.
(1) A military or civilian Government employee will not appoint, employ,
supervise, direct or evaluate contractor personnel.
(2) Contractor personnel will not:
(a) make Government policy;
(b) command, supervise, direct, or evaluate Government military or
civilian personnel or other contractor personnel; or
(c) be part of a Government organization.
d. The Contractor and/or its employees will not exercise personal
judgment or discretion on behalf of the Government.
e. Contractor employees will act and exercise personal judgment or
discretion only on behalf of the Contractor.
f. The Contractor and its employees entering Picatinny Arsenal will
follow the installation's rules, regulations, directions and other
requirements for good order, security and administration.
MATERIAL INSPECTION AND RECEIVING REPORT (WRITTEN IN PLAIN ENGLISH)
- -------------------------------------------------------------------
Distribute DD Form 250 to the following:
1 each - ARDEC, ATTN: Michael Los, AMSTA-AR-SRC
Building 172
1 each - Contract Admin Office Block 6 of SF30
1 each - Contract Office Block 5 of SF30
4 each - Payment Office As shown in on Page 4 of this modification.
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 10 OF 19
MODIFICATION P00010
MATERIAL SAFETY DATA SHEETS (MSDS) (WRITTEN IN PLAIN ENGLISH)
- -------------------------------------------------------------
1. The contractor shall send the Material Safety Data Sheets (MSDS) prior to
award to the Contracting Officer and a copy with the first delivery of
supplies to Commander, U.S. Army ARDEC, ATTN: SMCAR-SE, Picatinny Arsenal, NJ
07806-5000, required by FAR 52.223-3, Hazardous Material Identification and
Material Safety Data, FAR 52.223-3.
2. We will not accept a delivery of any hazardous chemical/material when:
a. the applicable MSDS is not delivered with the first delivery of the
supplies; and/or
b. the container label on the supplies is inadequate, unreadable,
missing, or does not agree with the accompanying MSDS.
52.252-2 CLAUSES INCORPORATED BY REFERENCE. (JUN 1988)
- ------------------------------------------------------
This contract incorporates one or more clauses by reference, with the same
force and effect as if they were given in full text. Upon request, the
Contracting Officer will make their full text available.
52.202-1 DEFINITIONS OCT 1995
52.203-3 GRATUITIES APR 1984
52.203-5 COVENANT AGAINST CONTINGENT FEES APR 1984
52.203-6 RESTRICTIONS ON SUBCONTRACTOR SALES JUL 1995
TO THE GOVERNMENT
52.203-7 ANTI-KICKBACK PROCEDURES JUL 1995
52.203-8 CANCELLATION, RESCISSION, AND JAN 1997
RECOVERY OF FUNDS FOR ILLEGAL OR
IMPROPER ACTIVITY
52.203-10 PRICE OR FEE ADJUSTMENT FOR ILLEGAL JAN 1997
OR IMPROPER ACTIVITY
52.204-4 PRINTING/COPYING DOUBLE-SIDED ON JUN 1996
RECYCLED PAPER
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 11 OF 19
MODIFICATION P00010
52.209-6 PROTECTING THE GOVERNMENT'S JUL 1995
INTEREST WHEN SUBCONTRACTING WITH
CONTRACTORS DEBARRED, SUSPENDED, OR
PROPOSED FOR DEBARMENT
52.211-15 DEFENSE PRIORITY AND ALLOCATION SEP 1990
REQUIREMENTS
52.215-2 AUDIT AND RECORDS--NEGOTIATION AUG 1996
52.215-23 PRICE REDUCTION FOR DEFECTIVE COST OCT 1995
OR PRICING DATA--MODIFICATIONS
52.215-25 SUBCONTRACTOR COST OR PRICING DATA OCT 1995
-MODIFICATIONS
52.215-27 TERMINATION OF DEFINED BENEFIT MAR 1996
PENSION PLANS
52.215-31 WAIVER OF FACILITIES CAPITAL COST SEP 1987
OF MONEY
52.215-33 ORDER OF PRECEDENCE JAN 1986
52.215-39 REVERSION OR ADJUSTMENT OF PLANS MAR 1996
FOR POST-RETIREMENT BENEFITS OTHER
THAN PENSIONS (PRB)
52.215-40 NOTIFICATION OF OWNERSHIP CHANGES FEB 1995
52.219-8 UTILIZATION OF SMALL, SMALL OCT 1995
DISADVANTAGED AND WOMEN-OWNED SMALL
BUSINESS CONCERNS
52.222-3 CONVICT LABOR AUG 1996
52.222-4 CONTRACT WORK HOURS AND SAFETY JUL 1995
STANDARDS ACT--OVERTIME
COMPENSATION
52.222-26 EQUAL OPPORTUNITY APR 1984
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 12 OF 19
MODIFICATION P00010
52.222-28 EQUAL OPPORTUNITY PREAWARD APR 1984
CLEARANCE OF SUBCONTRACTS
52.222-35 AFFIRMATIVE ACTION FOR SPECIAL APR 1984
DISABLED AND VIETNAM ERA VETERANS
52.222-36 AFFIRMATIVE ACTION FOR HANDICAPPED APR 1984
WORKERS
52.222-37 EMPLOYMENT REPORTS ON SPECIAL JAN 1988
DISABLED VETERANS AND VETERANS OF
THE VIETNAM ERA
52.222-41 SERVICE CONTRACT ACT OF 1965, AS MAY 1989
AMENDED
52.222-44 FAIR LABOR STANDARDS ACT AND MAY 1989
SERVICE CONTRACT ACT--PRICE
ADJUSTMENT
52.223-2 CLEAN AIR AND WATER APR 1984
52.223-6 DRUG-FREE WORKPLACE JAN 1997
52.223-14 TOXIC CHEMICAL RELEASE REPORTING OCT 1996
52.225-11 RESTRICTIONS ON CERTAIN FOREIGN OCT 1996
PURCHASES
52.227-1 AUTHORIZATION AND CONSENT JUL 1995
52.227-2 NOTICE AND ASSISTANCE REGARDING AUG 1996
PATENT AND COPYRIGHT INFRINGEMENT
52.229-4 FEDERAL, STATE, AND LOCAL TAXES JAN 1991
(NONCOMPETITIVE CONTRACT)
52.229-5 TAXES--CONTRACTS PERFORMED IN U.S. APR 1984
POSSESSIONS OR PUERTO RICO
52.230-2 COST ACCOUNTING STANDARDS APR 1996
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 13 OF 19
MODIFICATION P00010
52.230-3 DISCLOSURE AND CONSISTENCY OF COST APR 1996
ACCOUNTING PRACTICES
52.232-32 PERFORMANCE-BASED PAYMENTS OCT 1995
52.232-8 DISCOUNTS FOR PROMPT PAYMENT APR 1989
52.232-9 LIMITATION ON WITHHOLDING OF APR 1984
PAYMENTS
52.232-11 EXTRAS APR 1984
52.232-17 INTEREST JUN 1996
52.232-23 ASSIGNMENT OF CLAIMS JAN 1986
--ALTERNATE I (APR 1984)
52.232-25 PROMPT PAYMENT MAR 1994
52.233-1 DISPUTES OCT 1995
52.233-3 PROTEST AFTER AWARD AUG 1996
52.242-13 BANKRUPTCY JUL 1995
52.243-1 CHANGES--FIXED-PRICE AUG 1987
--ALTERNATE I (APR 1984)
52.244-1 SUBCONTRACTS (FIXED-PRICE FEB 1995
CONTRACTS)
52.244-5 COMPETITION IN SUBCONTRACTING DEC 1996
52.246-25 LIMITATION OF LIABILITY--SERVICES FEB 1997
52.249-2 TERMINATION FOR CONVENIENCE OF THE SEP 1996
GOVERNMENT (FIXED-PRICE)
52.249-8 DEFAULT (FIXED-PRICE SUPPLY AND APR 1984
SERVICE)
52.253-1 COMPUTER GENERATED FORMS JAN 1991
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 14 OF 19
MODIFICATION P00010
252.203-7000 STATUTORY PROHIBITIONS ON NOV 1995
COMPENSATION TO FORMER DEPARTMENT
OF DEFENSE EMPLOYEES
252.203-7001 SPECIAL PROHIBITION ON EMPLOYMENT NOV 1995
252.204-7003 CONTROL OF GOVERNMENT PERSONNEL APR 1992
WORK PRODUCT
252.225-7001 BUY AMERICAN ACT AND BALANCE OF JAN 1994
PAYMENTS PROGRAM
252.225-7002 QUALIFYING COUNTRY SOURCES AS DEC 1991
SUBCONTRACTORS
252.231-7000 SUPPLEMENTAL COST PRINCIPLES DEC 1991
252.242-7000 POSTAWARD CONFERENCE DEC 1991
52.215-42 REQUIREMENTS FOR COST OR PRICING DATA OR INFORMATION OTHER THAN
- -------------------------------------------------------------------------
COST OR PRICING DATA--MODIFICATIONS. (JAN 1997)
- -----------------------------------------------
(a) Exceptions from cost or pricing data.
(1) In lieu of submitting cost or pricing data for modifications under this
contract, for price adjustments expected to exceed the threshold set forth at
FAR 15.804-2(a)(1) on the date of the agreement on price or the date of the
award, whichever is later, the Contractor may submit a written request for
exception by submitting the information described in the following
subparagraphs. The Contracting Officer may require additional supporting
information, but only to the extent necessary to determine whether an
exception should be granted, and whether the price is fair and reasonable--
(i) Identification of the law or regulation establishing the price offered.
If the price is controlled under law by periodic rulings, reviews, or similar
actions of a governmental body, attach a copy of the controlling document,
unless it was previously submitted to the contracting office.
(ii) Information on modifications of contracts or subcontracts for commercial
items.
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 15 OF 19
MODIFICATION P00010
(A) If (1) The original contract or subcontract was granted an exception from
cost or pricing data requirements because the price agreed upon was based on
adequate price competition, or prices set by law or regulation, or was a
contract or subcontract for the acquisition of a commercial item, and (2) the
modification (to the contract or subcontract) is not exempted based on one of
these exceptions, then the Contractor may provide information to establish
that the modification would not change the contract or subcontract from a
contract or subcontract for the acquisition of a commercial item to a
contract or subcontract for the acquisition of an item other than a
commercial item.
(B) For a commercial item exception, the Contractor shall provide, at a
minimum, information on prices at which the same item or similar items have
previously been sold that is adequate for evaluating the reasonableness of
the price of the modification. Such information may include:
(1) For catalog items, a copy of or identification of the catalog and its
date, or the appropriate pages for the offered items, or a statement that the
catalog is on file in the buying office to which the proposal is being
submitted. Provide a copy or describe current discount policies and price
lists (published or unpublished), e.g., wholesale, original equipment
manufacturer, or reseller. Also explain the basis of each offered price and
its relationship to the established catalog price, including how the proposed
price relates to the price of recent sales in quantities similar to the
proposed quantities.
(2) For market-price items, the source and date or period of the market
quotation or other basis for market price, the base amount, and the
applicable discounts. In addition, describe the nature of the market.
(3) For items included on an active Supply Service Multiple Award Schedule
contract, proof that an exception has been granted for the schedule.
(2) The Contractor grants the Contracting Officer or an authorized
representative the right to examine, at any time before award, books,
records, documents, or other directly pertinent records to verify any request
for an exception under this clause, and the reasonableness of price. Access
does not extend to cost or profit information or other data relevant solely
to the Contractor's determination of the prices to be offered in the catalog
or marketplace.
(b) Requirements for cost or pricing data. If the Contractor is not granted
an exception from the requirement to submit cost pricing data, the following
applies:
(1) The Contractor shall submit cost or pricing data on standard Form (SF)
1411 Contract Pricing Proposal Cover Sheet (Cost or Pricing Data Required),
with supporting attachments prepared in accordance with Table 15-2 of FAR
15.804-6(b)(2).
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 16 OF 19
MODIFICATION P00010
(2) As soon as practical after agreement on price, but before
award (except for unpriced actions), the Contractor shall submit a Certificate
of Current Cost or Pricing Data, as prescribed by FAR 15.804-4.
I.3 52.223-3 HAZARDOUS MATERIAL IDENTIFICATION AND MATERIAL SAFETY DATA.
--------------------------------------------------------------------
(JAN 1997)
- ----------
(a) "Hazardous material," as used in this clause, includes any material
defined as hazardous under the latest version of Federal Standard No. 313
(including revisions adopted during the term of the contract).
(b) The offeror must list any hazardous material, as defined in paragraph (a)
of this clause, to be delivered under this contract. The hazardous material
shall be properly identified and include any applicable identification
number, such as National Stock Number or Special Item Number. This
information shall also be included on the Material Safety Data Sheet
submitted under this contract.
Material (if none, insert "None")
________________________________________________________________
________________________________________________________________
________________________________________________________________
Identification No.
________________________________________________________________
________________________________________________________________
________________________________________________________________
(c) This list must be updated during the performance of the contract whenever
the Contractor determines that any other material to be delivered under this
contract is hazardous.
(d) The apparently successful offeror agrees to submit, for each item as
required prior to award, a Material Safety Data Sheet, meeting the
requirements of 29 CFR 1910.1200(g) and the latest version of Federal
Standard No. 313, for all hazardous material identified in paragraph (b) of
this clause. Data shall be submitted in accordance with Federal Standard No.
313, whether or not the apparently successful offeror is the actual
manufacturer of these items. Failure to submit the Material Safety Data Sheet
prior to award may result in the apparently successful offeror being
considered non responsible and ineligible for award.
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 17 OF 19
MODIFICATION P00010
(e) If, after award, there is a change in the composition of the item(s) or a
revision to Federal Standard No. 313, which renders incomplete or inaccurate
the data submitted under paragraph (d) of this clause, the Contractor shall
promptly notify the Contracting Officer and resubmit the data.
(f) Neither the requirements of this clause nor any act or failure to act by
the Government shall relieve the Contractor of any responsibility or
liability for the safety of Government, Contractor, or subcontractor
personnel or property.
(g) Nothing contained in this clause shall relieve the Contractor from
complying with applicable Federal, State, or local laws, codes, ordinances,
and regulations (including the obtaining of licenses and permits) in
connection with hazardous material.
(h) The Government's rights in data furnished under this contract with
respect to hazardous material are as follows: (1) To use, duplicate and
disclose any data to which this clause is applicable. The purposes of this
right are to:
(i) Apprise personnel of the hazards to which they may be exposed in using,
handling, packaging, transporting, or disposing of hazardous materials;
(ii) Obtain medical treatment for those affected by the material; and
(iii) Have others use, duplicate, and disclose the data for the Government
for these purposes.
(2) To use, duplicate, and disclose data furnished under this clause, in
accordance with subparagraph (h)(1) of this clause, in precedence over any
other clause of this contract providing for rights in data.
(3) The Government is not precluded from using similar or identical data
acquired from other sources.
52.223-7 NOTICE OF RADIOACTIVE MATERIALS. (JAN 1997)
- ----------------------------------------------------
(a) The Contractor shall notify the Contracting Officer or designee, in
writing, [ ]* days prior to the delivery of, or prior to completion of any
servicing required by this contract of, Items containing either
(1) radioactive material requiring specific licensing under the regulations
issued pursuant to the Atomic Energy Act of 1954, as amended, as set forth in
title 10 of the Code of Federal Regulations, in effect on the date of this
contract; or
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 18 OF 19
MODIFICATION P00010
(2) other radioactive material not requiring specific licensing in which the
specific activity is greater than 0.002 microcuries per gram or the activity
per item equals or exceeds 0.01 microcuries. Such notice shall specify the
part or parts of the items which contain radioactive materials, a description
of the materials, the name and activity of the isotope, the manufacturer of
the materials, and any other information known to the Contractor which will
put users of the items on notice as to the hazards involved (OMB No.
9000-0107).
* The contracting Officer shall insert the number of days required in advance
of delivery of the item or completion of the servicing to assure that
required licenses are obtained and appropriate personnel are notified to
institute any necessary safety and health precautions. See FAR 23.601(d).
(b) If there has been no change affecting the quantity of activity, or the
characteristics and composition of the radioactive material from deliveries
under this contract or prior contracts, the Contractor may request that the
Contracting Officer or designee waive the notice of requirement in paragraph (a)
of this clause. Any such request shall:
(1) Be submitted in writing;
(2) State that the quantity of activity, characteristics, and composition of
the radioactive material have not changed; and
(3) Cite the contract number on which the prior notification was submitted
and the contracting office to which it was submitted.
(c) All items, parts or subassemblies which contain radioactive materials in
which the specific activity is greater than 0.002 microcuries per gram or
activity per item equals or exceeds 0.01 microcuries, and all containers in
which such items, parts or subassemblies are delivered to the Government
shall be clearly marked and labeled as required by the latest version of
MIL-STD 129 in effect on the date of the contract.
(d) This clause, including this paragraph (d), shall be inserted in all
subcontracts for radioactive materials meeting the criteria in paragraph (a) of
this clause.
<PAGE>
CONTINUATION SHEET DAAK10-81-C-0323 PAGE 19 OF 19
MODIFICATION P00010
52.244-6 SUBCONTRACTS FOR COMMERCIAL ITEMS AND COMMERCIAL COMPONENTS.
- ---------------------------------------------------------------------
(OCT 1995)
- ----------
(a) Definition.
Commercial item, as used in this clause, has the meaning contained in the
clause at 52.202-1, Definitions.
Subcontract, as used in this clause, includes a transfer of commercial items
between divisions, subsidiaries, or affiliates of the Contractor or
subcontractor at any tier.
(b) To the maximum extent practicable, the Contractor shall incorporate, and
require its subcontractors at all tiers to incorporate, commercial items or
non developmental items as components of items to be supplied under this
contract.
(c) Notwithstanding any other clause of this contract, the Contractor is not
required to include any FAR provision or clause, other than those listed
below to the extent they are applicable and as may be required to establish
the reasonableness of prices under Part 15, in a subcontract at any tier for
commercial items or commercial components:
(1) 52.222-26, Equal Opportunity (E.O. 11246);
(2) 52.222-35, Affirmative Action for Special Disabled and Vietnam Era
Veterans (38 U.S.C. 4212(a));
(3) 52.222-36, Affirmative Action for Handicapped Workers (29 U.S.C. 793);
and
(4) 52.247-64, Preference for Privately Owned U.S.-Flagged Commercial Vessels
(46 U.S.C. 1241) (flow down not required for subcontracts awarded beginning
May 1, 1996).
(d) The Contractor shall include the terms of this clause, including this
paragraph (d), in subcontracts awarded under this contract.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-END> MAR-31-1997
<CASH> 448,000
<SECURITIES> 0
<RECEIVABLES> 4,841,000
<ALLOWANCES> 421,000
<INVENTORY> 11,679,000
<CURRENT-ASSETS> 17,123,000
<PP&E> 47,748,000
<DEPRECIATION> 32,584,000
<TOTAL-ASSETS> 33,509,000
<CURRENT-LIABILITIES> 7,174,000
<BONDS> 0
0
0
<COMMON> 239,000
<OTHER-SE> 24,753,000
<TOTAL-LIABILITY-AND-EQUITY> 33,509,000
<SALES> 12,613,000
<TOTAL-REVENUES> 12,613,000
<CGS> 8,588,000
<TOTAL-COSTS> 11,874,000
<OTHER-EXPENSES> (11,000)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 119,000
<INCOME-PRETAX> 631,000
<INCOME-TAX> 13,000
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 618,000
<EPS-PRIMARY> 0.13
<EPS-DILUTED> 0.13
</TABLE>
<PAGE>
EXHIBIT 99.1
"SAFE HARBOR" STATEMENT UNDER PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995
Forward-looking statements made by or on behalf of the Company
represent the Company's reasonable judgement on the future and are subject to
risks and uncertainties. Actual results may differ materially from those
projected in the forward-looking statements. Such risks and uncertainties
include, among others:
DEPENDENCE ON PROPRIETARY TECHNOLOGY. The Company's success is heavily
dependent upon its proprietary technology. The Company attempts to protect
its proprietary technology through patents, copyrights, trademarks, trade
secrets and license agreements. Nevertheless, there can be no assurance that
the Company will be able to protect its technology from misappropriation or
that competitors will not be able to be able to develop similar technology
independently. In addition, effective patent, copyright, trademark and trade
secret protection may be unavailable or limited in certain foreign countries.
DEPENDENCE ON KEY PERSONNEL. The success of the Company is dependent in part
on its ability to hire and retain qualified managerial personnel. Although
the Company to date has been able to hire and retain such personnel, there
can be no assurance that the Company will be successful in recruiting and
retaining such personnel in the future.
SIGNIFICANT CUSTOMERS. The Company has several customers which account for a
significant portion of the Company's business. If any of these customers
were lost to the Company, this could have a material adverse effect on the
Company.
GOVERNMENT AND ENVIRONMENTAL REGULATION. Certain of the materials regularly
processed by the Company, i.e. depleted uranium and beryllium, have
characteristics considered to be health or safety hazards by various federal,
state or local regulatory agencies. Furthermore, depleted uranium is a
low-level radioactive material and the Company is subject to regulation by
the United States Nuclear Regulatory Commission. The regulatory process may
be time consuming and costly and is subject to considerations generally
affecting the process of governmental decision making. The Company cannot
predict the impact of future regulations and rules imposed upon the Company's
business.
RESEARCH AND DEVELOPMENT. The Company engages in various research and
development activities in order to stay competitive with its competitors.
There is no guarantee that such research and development will yield new
products or technologies or create additional revenue for the Company.
GOVERNMENT CONTRACTS. The Company derives significant portions of its
revenue from sales made to various governments (and government contractors)
and militaries around the world. Therefore any change in the government or
military spending of the Company's customers may impact the Company's net
revenues.
