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EXHIBIT 3.1
FIRST AMENDMENT TO
AGREEMENT AND PLAN OF MERGER
This Agreement is effective November 15, 2000, by and between TEMROC
METALS, INC., a Minnesota corporation ("Temroc"), QUANEX CORPORATION, a Delaware
corporation ("Quanex") and QUANEX FIVE, INC., a Delaware corporation and wholly
owned subsidiary of Quanex ("Sub").
RECITALS
1. Temroc, Quanex and Sub entered into that certain Agreement and Plan of
Merger dated October 23, 2000 ("Merger Agreement").
2. It is the intent of the parties that the Merger Consideration to the
Temroc stockholders as defined in the Merger Agreement, shall include (i) the
cash payment made by Quanex to Temroc at Closing, (ii) any Adjustment Amount
required by Section 1.9(d) of the Merger Agreement, (iii) the cash proceeds
received from the sale of AaCron, Temroc's wholly owned subsidiary, (iv)
membership units in Cormet Land, LLC, and (v) amounts remaining in the Escrow
Account, not to exceed $900,000.
3. The parties felt that certain language in the Merger Agreement did not
properly reflect all of the items included within the definition of Merger
Consideration.
4. Temroc, Quanex and Sub have agreed to amend the Merger Agreement as set
forth herein.
NOW, THEREFORE, Temroc, Quanex and Sub, agree as follows:
1. The first sentence of Section 1.6 of the Merger Agreement shall be
amended to read as follows:
"In reliance on the representations and warranties of Temroc contain
in this Agreement, and on the terms and subject to the conditions set forth in
this Agreement, except as provided in Section 1.7 (regarding shares held by
dissenting shareholders), Parent shall pay the shareholders of Temroc a total
consideration of $18,771,300, plus the adjustments payable by Parent as
described in Section 1.9, as applicable and Temroc shall pay the shareholders of
Temroc the cash and/or property described in Section 1.9, as applicable
(collectively the "Merger Consideration")."
2. Section 1.9(a) of the Merger Agreement shall amended to read as
follows:
"The Net Asset Value as of December 31, 1999 was $5,227,368. If,
based on Temroc's financial statements as of July 31, 2000, the Net Asset Value
as of July 31, 2000 exceeds $5,227,368, then Parent shall pay at Closing, as
Merger Consideration, an amount equal to such
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excess (the "Additional Closing Consideration"). If the Net Asset Value as of
July 31, 2000 does not exceed $5,227,368, then Parent shall not pay any amount
as additional Merger Consideration at the time of the Closing. Any cash proceeds
received by Temroc pursuant to the disposition of the stock of AaCron will be
paid by Temroc as Merger Consideration to the shareholders of Temroc at the
Closing. Prior to the Closing, Temroc's interests in the Partnerships shall be
contributed to Cormet Land, LLC ("Cormet") in return for all of the membership
interests in Cormet, and the membership interests in Cormet shall be assigned by
Temroc to the shareholders of Temroc at the Closing as Merger Consideration. The
cash proceeds received by Temroc for the sale of the AaCron stock and the
membership interests in Cormet received by Temroc for the disposition of the
Partnerships will not be included on the Closing Date Balance Sheet, as defined
in Section 1.9(b) below."
3. The first sentence of Section 1.9(d) of the Merger Agreement shall be
amended to read as follows:
"If the Net Asset Value, based on the Closing Date Balance Sheet
(the "Closing Date Net Asset Value"), is greater than the sum of $5,227,368 and
the Additional Closing Consideration, Parent shall pay the Temroc shareholders
as additional Merger Consideration an Adjustment Amount equal to the excess of
the Net Asset Value over the sum of $5,227,368 and the Additional Closing
Consideration, plus interest on such excess amount based on an annual rate of
7.5% from the date of the Closing until the date of payment by the Parent."
4. The amendments above shall be the sole changes to the Agreement and
Plan of Merger and all other terms of the Agreement and Plan of Merger shall
remain effective and enforceable.
IN WITNESS WHEREOF, the parties have executed this First Amendment
effective as of the date and year first indicated above.
QUANEX CORPORATION
By /s/
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Its Vice President - Finance
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QUANEX FIVE, INC.
By /s/
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Its Vice President - Finance
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TEMROC METALS, INC.
By /s/
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Its: President
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