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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported) October 1, 1997
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LINDBERG CORPORATION
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(Exact Name of Registrant as Specified in Its Charter)
DELAWARE
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(State or Other Jurisdiction of Incorporation)
0-8287 36-1391480
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(Commission File Number) (I.R.S. Employer Identification No.)
6133 North River Road, Suite 700, Rosemont, Illinois 60018
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(Address of Principal Executive Offices) (Zip Code)
(847) 823-2021
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(Registrant's Telephone Number, Including Area Code)
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Item 2: Acquisition or Disposition of Assets
Pursuant to a partnership agreement, dated July 1, 1994, the
registrant held a 50% partnership interest in a California
general partnership (the "Partnership" ) engaged in the business
of aluminum and titanium heat treating. The remaining
partnership interests of the Partnership were held respectively
by Aerospace Aluminum Heat Treating Company, a California
corporation ( "Aerospace"), and Alta Canada Corporation, a
California corporation ( "Alta", and collectively with Aerospace,
the "Sellers" ). On October 1, 1997, the registrant purchased
all the partnership interests of the Partnership held by the
Sellers. Immediately upon the consummation of the transaction,
the registrant held 100% of the partnership interest in the
Partnership. The registrant paid $6.5 million in cash to the
Sellers at the closing and delivered promissory notes in the
aggregate principal amount of $6.5 million. Immediately
following the closing of the acquisition, the registrant
contributed the assets and liabilities of the partnership to its
wholly-owned limited liability company, Alumatherm Heat Treating
Company, L.L.C., a Delaware limited liability Company
( "Alumatherm"). Alumatherm intends to use the acquired assets
in the same manner as they were used prior to the acquisition.
The cash portion of the funds paid for the partnership interest
purchase was made available under an amended bank credit
agreement with Bank of America National Trust and Savings
Association.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
LINDBERG CORPORATION
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(Registrant)
Date October 15, 1997 By /s/Stephen S. Penley
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Stephen S. Penley
Senior Vice President, Chief Financial
Officer and Secretary
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LINDBERG CORPORATION FORM 8-K
Exhibit Index
Number and Description of Exhibit
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2. Plan of acquisition, reorganization,
arrangement, liquidation or succession
2.1 Partnership Interest Purchase
Agreement, dated October 1, 1997,
among Lindberg Corporation,
Aerospace Heat Treating Company,
Alta Canada Corporation, and
California Manufacturing
Enterprises, Inc. attached
4. Instruments defining the rights of
security holders, including indentures
4.1 Third Amendment to Amended and
Restated Credit Agreement, dated
September 29, 1997 attached
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PARTNERSHIP INTEREST
PURCHASE AGREEMENT
This PARTNERSHIP INTEREST PURCHASE AGREEMENT ("Agreement") is
made and entered into as of October 1, 1997, between LINDBERG
CORPORATION, a Delaware corporation ("Buyer"), and AEROSPACE ALUMINUM
HEAT TREATING COMPANY, a California corporation ("Aerospace"), ALTA
CANADA CORPORATION, a California corporation ("Alta") and California
Manufacturing Enterprises, Inc., a California corporation ("CME" and,
collectively with Alta and Aerospace, the "Seller Parties").
INTRODUCTION
The Seller Parties propose to sell and assign to Buyer, and the
Buyer proposes to purchase from the Seller Parties, on the terms and
s u bject to the conditions set forth in this Agreement, the
p a rtnership interests in Alumatherm Heat Treating Company, a
California general partnership (the "Partnership"), presently held by
the Seller Parties. Buyer currently owns a 50% partnership interest
in the Partnership. Upon such sale and assignment by the Seller
Parties pursuant to an Assignment of Partner's Interests (an
"Assignment"), Buyer will own 100% of all partnership interests in
the Partnership.
In consideration of the premises and the mutual benefits to be
derived from this Agreement and of the respective representations,
warranties, agreements, indemnities, and promises contained herein,
the parties, intending to be legally bound, agree as follows:
Article I
DEFINITIONS; INTERPRETATIONS
SECTION 1.1 Definitions.
"Agreement" or "this Agreement" means this Partnership Interest
Purchase Agreement between the Seller Parties and Buyer (including
the Exhibits and Schedules hereto) and all amendments hereto made in
accordance with the provisions of Section 8.1.
"Assignment" has the meaning specified in the introduction to
this Agreement.
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"Buyer" has the meaning specified in the first paragraph of this
Agreement.
"Buyer's Indemnitee" has the meaning specified in Section
7.1(b).
"Closing" has the meaning specified in Section 2.2.
"Closing Date" has the meaning specified in Section 2.2.
"Closing Financial Reports" means (i) a financial report
prepared in accordance with GAAP of the Partnership setting forth as
individual line items an aggregate gross asset value for all
indebtedness and other assets and liabilities of the Partnership as
of September 28, 1997 and the related unaudited statements of income
for the period then ended, including any notes thereto, and (ii) a
statement of the partners' capital accounts, in each case as of the
Closing Date after giving effect to the consummation of the
transactions contemplated by this Agreement.
"Code" means the Internal Revenue Code of 1986, as amended, and
the rules and regulations promulgated thereunder.
"Control" (including the terms "controlled by" and "under common
control with") means the possession, directly or indirectly or as
trustee or executor, of the power to direct or cause the direction of
the management and/or affairs of any person or entity, whether
through the ownership of stock, as trustee or executor, by contract
or credit arrangement or otherwise, including, without limitation,
the ownership, directly or indirectly, of securities having the power
to elect a majority of the board of directors or similar body
governing the affairs of such Person.
"Effective Date" means the date the purchase is effective which
shall be as of 12:01 a.m. (California time) on September 29, 1997.
"Encumbrance" means any security interest, pledge, mortgage,
lien (including environmental and tax liens), charge, encumbrance,
adverse claim, or restriction of any kind, including, without
limitation, any restriction on the use, voting, transfer, receipt of
income or other exercise of any attributes of ownership.
"Environmental Claim" means any judicial, administrative or
regulatory actions, suits, demands, demand letters, claims, liens,
notices of noncompliance or violation, notices of liability or
potential liability, investigations, or proceedings relating to any
Environmental Law, Environmental Permit or arising from alleged
injury or threat of injury to natural resources, health, safety or
the environment.
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"Environmental Law" means any federal, state, local or foreign
law, statute, ordinance, rule, regulation, code, license, permit,
authorization, approval, consent, legal doctrine, order, judgment,
decree, injunction, requirement, judicial or regulatory agency
i n t erpretation, policy or guidance, or agreement with any
governmental entity (a) relating to the environment (including,
without limitation, air, water vapor, surface water, ground-water,
drinking water supply, surface land, subsurface land, plant and
animal life or any other natural resource) or to human health or
safety, or (b) the exposure to, or the use, storage, recycling,
t r e atment, generation, transportation, processing, handling,
labeling, production, release or disposal of Hazardous Substances.
In each case as amended and as now or hereafter in effect, including,
w i thout limitation, (i) the Oil Pollution Act of 1990, the
Comprehensive Environmental Response Compensation and Liability Act
of 1980, the Water Pollution Control Act, the Clean Air Act, the
Clean Water Act, the Resource Conservation and Recovery Act of 1978,
the Solid Waste Disposal Act, the Toxic Substances Control Act, the
Federal Insecticides, Fungicide and Rodenticide Act, the Federal
Occupational Safety and Health Act, and (ii) any common or civil law
or equitable doctrine (including, without limitation, injunctive
relief and tort doctrines such as negligence, nuisance, trespass and
strict liability) that may impose liability or obligations or
injuries or damages due to, or threatened as a result of, the
presence of or exposure to any Hazardous Substance.
"Environmental Permit" means any permit, application, license,
approval, identification number, or other authorization required
under any Environmental Law.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, together with the rules and regulations promulgated
thereunder.
"GAAP" means United States generally accepted accounting
principles and practices in effect from time to time applied
consistently throughout the periods involved.
"Hazardous Material or Hazardous Substance" means any substance
presently or hereafter listed, defined, designated, classified, or
regulated as hazardous, toxic, radioactive, or dangerous or words of
similar import, under any Environmental Law, whether by type or by
quantity, including any substance containing any such substance as a
component, including, without limitation, any toxic waste, pollutant,
containment, hazardous substance, toxic substance, hazardous waste,
special waste, industrial substance or petroleum, or any derivative
or by-product or break-down product thereof, radon, radioactive
material, asbestos, asbestos containing material, urea formaldehyde
foam insulation, lead, and polychlorinated biphenyl.
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"Indemnified Liabilities" has the meaning specified in Section
7.1.
"Knowledge" or "Known" means that an individual will be deemed
to have knowledge of a particular fact or other matter if: (a) such
individual has actual conscious awareness of such fact or other
matter; or (b) a prudent individual could be expected to discover or
otherwise become aware of such fact or other matter in the course of
conducting a reasonable investigation concerning the existence of
such fact or other matter. A corporation or other entity will be
deemed to have knowledge of a particular fact or other matter if any
individual who is serving, or who has at any time served, as a
d i r ector, executive officer, or equivalent position of such
corporation or other entity, or serves at the direction of such
corporation or other entity in such capacity for another corporation
or entity, has or at any time had, knowledge of the fact or other
matter; provided, however, that Buyer shall be deemed to have
knowledge of a particular fact or other matter only if an individual
who is serving, or who has at any time served, as a director or
executive officer of Buyer, or who serves at the direction of Buyer
in an or equivalent capacity for another corporation or entity, has
or at any time had, actual conscious awareness of the fact or other
matter.
"Liabilities" has the meaning specified in Section 7.1(a).
"Material Adverse Effect" means any circumstance, change, event,
transaction, loss, failure, effect, or other occurrence, whether
individually or in the aggregate with any other circumstance, change,
event, transaction, loss, failure, effect, or other occurrence, which
is or is reasonably likely to be materially adverse to the business,
operations, properties, or conditions (financial or otherwise) of the
Partnership.
"Obligations" means debts, liabilities, obligations, duties and
responsibilities of any kind and description, whether absolute,
accrued or contingent, monetary or non-monetary, direct or indirect,
known or unknown or matured or unmatured, or of any other nature.
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"Partnership" has the meaning specified in the recitals to this
Agreement.
"Partnership Agreement" means the Alum-A-Therm Partnership
Agreement, dated July 1, 1994, between Buyer and Aerospace, as
amended from time to time.
"Partnership Documents" has the meaning specified in Section
3.6.
"Permitted Encumbrances" shall mean (any easements, rights of
w a y , restrictions, installations of public utilities, title
imperfections and restrictions, reservations in land patents, zoning
o r dinances or other similar Encumbrances referenced in title
insurance policies previously provided to Buyer); the interests of
lessors in any property used in the Partnership's business; liens for
current taxes, assessments and governmental changes not yet due and
payable; all which do not, either individually or in the aggregate,
materially detract from the value of, or interfere with the present
use of the assets of the Partnership.
"Purchase Price" has the meaning specified in Section 2.1(b).
"Purchased Interests" has the meaning specified in Section
2.1(a).
"Seller Parties" has the meaning specified in the recitals to
this Agreement.
"Tax" means any and all fees (including without limitation
documentation, recording license, and registration fees), taxes
(including without limitation net income, alternative, unitary,
alternative minimum, minimum franchise, value added, ad valorem,
income, receipts, capital, excise, sales, use, leasing, fuel, excess
p r ofits, turnover, occupational, property (personal and real,
tangible and intangible), transfer, recording and stamp taxes,
levels, imposts, duties, charges, fees assessments, or withholdings
o f a ny nature whatsoever, general or special, ordinary or
extraordinary, and any transaction privilege or similar taxes)
imposed by or on behalf of any governmental agency or authority,
together with any and all penalties, fines, additions to tax and
interest thereon.
"Tax Return" means any return, declaration, report, claim for
refund, or information return or statement or other tax form relating
to Taxes, including any schedule or attachment thereto, and including
any attachment thereof.
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SECTION 1.2 Interpretations. Except as otherwise expressly
provided herein, the following rules of interpretation apply to this
Agreement: (i) the singular includes the plural and the plural
includes the singular except when the context otherwise requires;
(ii) "include" and "including" are not limiting; (iii) a reference to
any agreement or contract includes exhibits, schedules, and permitted
supplements and amendments thereto; (iv) a reference to a law
includes any amendment or modification to such law and any rules or
regulations issued thereunder; (v) a reference to a person or entity
includes such person's or entity's permitted successors and assigns;
and (vi) unless the context otherwise requires, a reference in this
Agreement to an Article, Section, Paragraph, Exhibit, or Schedule is
to the respective Article, Section, Paragraph, Exhibit, or Schedule
of or to this Agreement.
Article II
SALE AND PURCHASE OF PARTNER INTERESTS; CAPITAL CONTRIBUTIONS
SECTION 2.1 Sale and Purchase of Partnership Interests.
(a) Upon the terms and subject to the conditions set forth in
this Agreement, at the Closing, the Seller Parties shall sell,
assign, and transfer to Buyer, and the Buyer shall purchase from the
Seller Parties, partnership interests currently owned by the Seller
Parties in the Partnership (the "Purchased Interests").
(b) The total purchase price for the Purchased Interests shall
be $13,000,000 (the "Purchase Price") to be paid as set forth in
Section 2.2(b).
SECTION 2.2 Closing. The consummation of the transactions
contemplated by this Agreement (the "Closing") shall take place at
the offices of Stroock & Stroock & Lavan LLP, 2029 Century Park East,
Los Angeles, California, or such other place agreed to by the parties
hereto, on October 1, 1997 or such other date as the parties mutually
agree (such date of the Closing being hereinafter called the "Closing
Date") which shall be effective as of the Effective Date. At the
Closing, and upon the terms and subject to the conditions set forth
in this Agreement, the parties to this Agreement shall execute and
deliver each of the certificates, opinions, and documents required to
be delivered pursuant to Article VI, and shall take the following
actions, which deliveries and actions shall be deemed to have
occurred simultaneously and to constitute the Closing hereunder:
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(a) Buyer and each of the Seller Parties shall execute and
deliver the Assignment, in the form and content of Schedule 2.2(a)
attached hereto, pursuant to which the Seller Parties shall assign
and deliver the Purchased Interests to Buyer.
(b) Pursuant to the instructions set forth on Attachment 1
hereto, Buyer shall pay the Seller Parties the Purchase Price by
(a) one or more wire transfers aggregating of $6,500,000, in
immediately available funds (the "Cash Purchase Price") and (b) one
or more promissory notes in the aggregate principal amount of
$6,500,000, substantially in the form of Schedule 2.2(b) attached
hereto (the "Deferred Purchase Price").
Article III
REPRESENTATIONS AND WARRANTIES OF THE SELLER PARTIES
RELATING TO THE PARTNERSHIP
As inducement to Buyer to enter into this Agreement, the Seller
Parties, jointly and severally, represent and warrant to Buyer as
follows:
SECTION 3.1 Existence and Power. The Partnership is a
general partnership formed under the laws of the State of California,
and has the power and authority to own, operate, or lease the
properties owned, operated, or leased by the Partnership and to carry
on its business as it is currently conducted as of the date hereof.
The Partnership is duly licensed or qualified to do business and is
in good standing in each jurisdiction in which the properties owned
or leased by it or the operation of its business makes such licensing
or qualification necessary or desirable, except where the failure to
be so licensed or qualified would not have a material adverse effect
on the Partnership.
SECTION 3.2 Subsidiaries. There are no corporations,
partnerships, joint ventures associations, or other entities in which
the Partnership owns, of record or beneficially, any direct or
indirect equity or other interest or any right (contingent or
otherwise) to acquire the same, or in which the Partnership otherwise
participates.
SECTION 3.3 Financial Reports, Etc. As of the Closing Date,
other than those items incurred in the ordinary course of business
and not of a material nature, the Partnership has not incurred any
liabilities or obligations required to be set forth under GAAP other
than those disclosed in this Agreement or reflected on the Closing
Financial Reports, copies of which have been provided to the Buyer.
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SECTION 3.4 Partners. Prior to giving effect to the
transactions to occur at the Closing, the Seller Parties each own the
partnership interests in the amount of percentage interest in the
Partnership set forth opposite its name on Schedule 3.4 attached
hereto under the caption "percentage interest," free and clear of any
Encumbrance.
SECTION 3.5 Partnership Property. Schedule 3.5-A contains a
true and accurate list and description of all real property leased by
the Partnership. The Partnership does not own any real property.
Schedule 3.5-B contains a true and accurate list of all material
machinery, equipment, leasehold improvements, furniture and fixtures,
vehicles and other personal property of the Partnership. The
Partnership has good, valid, and marketable title to all the
properties, interests in properties and assets (including those
previously held by Aerospace), owned, licensed, or leased by it,
including each of the leasehold interests and assets listed on
Schedules 3.5-A and 3.5B, respectively, and used in the ordinary
course of its business (and the business of Aerospace conducted on
behalf of the Partnership) as presently conducted, free and clear of
any Encumbrance other than Permitted Encumbrances.
SECTION 3.6 Agreements. Schedule 3.6 hereto contains a list
o f each agreement, contract, lease, license, commitment, or
instrument (including any and all amendments thereto) (collectively,
the "Contracts") to which the Partnership is a party or by which the
Partnership or any of its assets is bound or subject and is in excess
of $20,000 (collectively, the "Partnership Documents"). Each of the
Partnership Documents is in full force and effect and valid and
enforceable in accordance with its terms in favor of the Partnership.
None of the Seller Parties have received notice or other written
communication relating to an actual or alleged default or breach of
(with or without the giving notice or the passage of time) any such
Contract by Partnership, except breaches or defaults, if any, that
would not have a material adverse effect on the Partnership or any of
its assets. To the Seller Parties' knowledge no other party is in
material default or beach of any such Contracts.
SECTION 3.7 No Liquidating Events. To the knowledge of the
Seller Parties, no liquidating event with respect to the Partnership
has occurred and is continuing and no event, other than the
transactions contemplated by this Agreement which, with the giving of
notice or lapse of time or both, would become a liquidating event has
occurred and is continuing.
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SECTION 3.8 Employees. (a) The Partnership, except to those
matters known to Buyer, has complied in all material respects with
all applicable laws relating to the employment of labor, including,
without limitation, those related to wages, hours and collective
bargaining and is not liable for any arrears of wages, penalties or
other sums for failure to comply with any of the foregoing.
(b) No material union or labor organization effort, and no
sex discrimination, racial discrimination, age discrimination or
other employment-related allegation, claim, suit or proceeding, has
been made or is pending with respect to the employees of the
Partnership and, to the Seller Parties' knowledge, no such effort,
allegation, claim, suit or proceeding has been threatened to be made,
raised or brought prior to the date of this Agreement.
(c) Except for those plans set forth on Schedule 3.8(c)
hereto (the "Plans"), the Partnership does not maintain or contribute
to, nor does any member of a "controlled group" (within the meaning
of Section 4971(e)(2)(B) of the Code) of which the Partnership is a
member maintain or contribute to, any "employee benefit plan," as
that term is defined in Section 3(3) of ERISA, or any stock purchase
plan, stock option plan, fringe benefit plan, bonus plan or any other
deferred compensation agreement, plan or funding arrangement, whether
or not such plan has been terminated and whether or not such plan is
of legally binding nature in the form of an informal understanding.
With respect to the Plans, the requirements of ERISA and the Code, as
applicable, to the knowledge of the Seller Parties, have been
fulfilled in all material respects and no event has occurred nor does
any condition exist which would subject the Partnership to any
material penalty, excise tax or liability.
SECTION 3.9 Litigation. There is no action, suit, or
proceeding pending or, to the knowledge of the Seller Parties,
investigation pending or action, suit, proceeding, or investigation
threatened against the Partnership, the Seller Parties or any of
their respective assets in any court or before any governmental
department, board, agency, or instrumentality or any arbitrator as to
which there is a reasonable possibility of an adverse determination
which would materially impair the Partnership's ability to perform
its obligations under any Partnership Document or would have a
Material Adverse Effect on the Partnership, or which would materially
impair any of the Seller Parties' ability to perform its obligations
under this Agreement or would have a Material Adverse Effect on the
consolidated financial condition of the Seller Parties.
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SECTION 3.10 Environmental Matters. Except as set forth in
Schedule 3.10 and to the Seller Parties' knowledge:
(a) The Partnership is in substantial compliance with all
Environmental Laws;
(b) The Partnership has obtained all Environmental Permits
which are required in connection with its business, all of which are
in full force and effect. The Partnership is in compliance with all
terms and conditions of such Environmental Permits, no action or
proceeding which could result in the revocation or suspension of any
such Environmental Permits is pending or threatened, and the
Partnership has not engaged in any conduct which could cause
revocation or suspension of any of their Environmental Permits under
Environmental Laws;
(c) There has been no contamination, whether of soil,
groundwater or otherwise, on, in, under or about the real property
owned, leased, occupied or operated by the Partnership;
(d) No portion of the real property owned, leased,
occupied or operated by the Partnership has been designated, listed,
or identified in any manner by the Environmental Protection Agency,
or any other government entity, or under and pursuant to any
Environmental Law as a hazardous waste or hazardous substance
disposal or removal site, superfund or clean-up site, or candidate
for clean-up, investigation, removal or closure pursuant to any
Environmental Law; and
(e) The Partnership has not received at any time prior to
the date hereof any summons, citation, notice, directive, letter or
other communication, written or oral, of any Environmental Claim,
including, without limitation, any notification as a potentially
responsible party with respect to any area impacted by any Hazardous
Substance, including, without limitation any state or federal
superfund site.
(f) The Seller Parties have provided the Buyer with all
written reports in Seller Parties possession which detail its
existing knowledge regarding all environmental impairments and
conditions at, on or under, or migrating from, the property owned by
the Seller Parties.
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SECTION 3.11 Tax Matters. (a) Except with respect to Taxes
contemplated by Section 7.5 of the Partnership Agreement, all Tax
Returns required to be filed by the Partnership, to Seller Parties'
knowledge, have been accurately prepared in all material respects and
timely filed and all Taxes for which the Partnership may be held
liable (other than the Taxes referred to in the next sentence), have
been paid or accrued within the prescribed period or any extension
thereof. Except with respect to Taxes contemplated by Section 7.5 of
the Partnership Agreement, all Taxes required to be withheld by the
Partnership or which have been accrued but unpaid, including, but not
limited to, Taxes arising as a result of payments (or amounts
allocable) to foreign partners or foreign persons or to employees of
the Partnership have been collected and withheld, and have been
either paid to the respective governmental agencies, set aside in
accounts for such purpose, or accrued, reserved against, and entered
upon the books and records of the employer.
(b) Except as would not, individually or in the aggregate,
have a Material Adverse Effect on the Partnership, there are no Tax
liens upon any property of the Partnership except for liens for
current Taxes not yet due and payable.
SECTION 3.12 Books and Records. The books of account,
organizational records, and other records of the Partnership, all of
which have been made available to Buyer, are complete and correct and
have been maintained in accordance with ordinary business practices.
At the Closing, all such books and records will be in the possession
of the Partnership.
SECTION 3.13 C o ndition and Sufficiency of Assets. The
operating assets of the Partnership are in satisfactory operating
condition and repair, and are adequate for the uses to which they are
being put, and, to the Seller Parties' knowledge, none of such
operating assets is in need of maintenance or repairs except for
ordinary, routine maintenance and repairs that are not material in
nature or cost. The assets of the Partnership are sufficient for the
continued conduct of the Partnership's business (including those
operations conducted by Aerospace on behalf of the Partnership) after
the Closing in the same manner and at the current levels as conducted
prior to the Closing. Buyer acknowledges, and the Seller Parties are
making no representation or warranty, that the equipment will be
sufficient to any increases or expansion of the Partnership's
business.
SECTION 3.14 Compliance with Laws. Except those matters known
to Buyer, to the Seller Parties' knowledge, the Partnership is in
material compliance with all laws, regulations and orders applicable
to it and neither the Partnership nor any of the Seller Parties has
received notification of any asserted past or present failure to
comply with any laws.
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SECTION 3.15 Proprietary Rights. Schedule 3.15 contains a
complete list of all the proprietary rights of or utilized by the
Partnership, including without limitation, all trademarks, trade
names, patents, patent applications, licenses thereof, trade secrets,
technology, processes, know-how, formulae, designs and drawings,
computer software, slogans, copyrights, and other similar intangible
property and rights related to the products, services, or business of
the Partnership (the "Proprietary Rights"). The Seller Parties have
no knowledge of any claims made or threatened for the assertion of
the invalidity or enforceability of any such rights, and there are no
grounds for the same.
Article IV
REPRESENTATIONS AND WARRANTIES AND COVENANTS OF THE
SELLER PARTIES
As an inducement to Buyer to enter into this Agreement, the
Seller Parties, jointly and severally, represent and warrant to
Buyer, and covenant, as follows:
SECTION 4.1 Existence and Power. Each of the Seller Parties
is a corporation, duly organized, validly existing and in good
standing under the laws of the State of California, and has the
corporate power and authority to own, operate or lease the properties
owned, operated or leased by it and to carry on its business. Each
of the Seller Parties is duly licensed or qualified to do business
and in good standing in each jurisdiction in which the properties
owned or leased by it or the operation of its business makes such
licensing or qualification necessary, except where failure to be so
licensed or qualified would not have a Material Adverse Effect on its
financial condition or its ability to perform its obligations
hereunder or to consummate the transactions contemplated hereby.
Each of the Seller Parties has the requisite corporate power and
authority to execute and deliver this Agreement and to perform its
obligations hereunder and to consummate the transaction contemplated
hereby, and the execution, delivery, and performance of this
Agreement has been duly authorized by all necessary actions and
formalities. This Agreement has been duly executed and delivered by
each of the Seller Parties and, assuming the due authorization,
execution, and delivery by Buyer, constitutes the legal, valid and
binding obligation of each of the Seller Parties enforceable against
it in accordance with its terms.
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SECTION 4.2 No Conflict; Required Filings and Consents.
Neither the execution, delivery and performance of this Agreement nor
the consummation by any of the Seller Parties of the transactions
contemplated hereby (i) conflicts with or violates (A) any law,
regulation, order, writ, injunction, decree, determination, or award
of any court, any governmental department, board, agency, or
instrumentality, domestic or foreign, or any arbitrator, applicable
to it, (B) its articles of incorporation or by-laws, or (C) any
contract, agreement, instrument, mortgage, note, lease or other
arrangement binding on or affecting it or any of its or their
property; (ii) requires any consent, authorization or approval under
any contract, agreement, instrument, mortgage, note, lease, or other
arrangement to which it or any of its property is bound, except as
have been or will be obtained prior to the Closing Date; or (iii)
results in the creation or imposition of any Encumbrance upon the
Partnership interests of the Seller Parties.
SECTION 4.3 Partnership Matters. Upon the Closing of the
transactions contemplated by this Agreement, the Seller Parties will
transfer good, valid and marketable title in the Purchased Interests
to the Buyer, free and clear of any Encumbrance (other than those
created by Buyer).
SECTION 4.4 Brokers. No broker, finder, or investment banker
is entitled to any brokerage, finder's, or other fee or commission in
connection with the transactions hereunder based upon arrangements
made by or on behalf of the Seller Parties. The Seller Parties,
jointly and severally, agree to indemnify and hold harmless Buyer
against any loss, liability, damage, cost, claim, or expense incurred
by reason of any brokerage, commission, or finder's fee alleged to be
payable because of any act, omission, or statement of the Seller
Parties (other than any liability to Buyer's brokers).
SECTION 4.5 Covenants Regarding Operation of the Partnership
Through the Closing. The Seller Parties agree as follows:
(a) From the date of this Agreement and except as
disclosed in the Closing Financial Reports identified in Section 3.3
h e r e of, the Seller Parties will not suffer any additional
Encumbrance, other than Permitted Encumbrances, with respect to the
Partnership's assets.
(b) The Seller Parties shall promptly notify Buyer of any
change in any condition with respect to the Partnership or of any
event or circumstance of which the Seller Parties becomes aware which
makes any representation or warranty of the Seller Parties under this
Agreement materially untrue or misleading, or any covenant of the
Seller Parties under this Agreement incapable or materially less
likely of being performed.
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SECTION 4.6 Partnership Taxes. The Seller Parties agree that
they are liable for their proportionate share of all Taxes with
respect to the operation of the Partnership prior to the Closing Date
based on its respective percentage ownership of the Partnership, and
to the extent such taxes are not satisfied, remain liable therefor.
The Seller Parties and Buyer agree that the final tax return of the
Partnership shall be prepared by Grobstein, Horwath & Company LLP and
the Seller Parties and Buyer shall share equally the costs and
expenses incurred in the preparation of such return.
Article V
REPRESENTATIONS AND WARRANTIES OF BUYER
As an inducement to the Seller Parties to enter into this
Agreement, Buyer represents, warrants and agrees to and with the
Seller Parties as follows:
SECTION 5.1 Existence and Power. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of
the State of Delaware and has corporate power and authority to own,
operate, or lease the properties owned, operated, or leased by it, if
any, and to carry on its businesses as have been and are currently
conducted as of the date hereof and as contemplated hereby. Buyer is
duly licensed or qualified to do business and are in good standing in
each jurisdiction (other than any jurisdiction which would not have
required Buyer to qualify to do business in which its business makes
such licensing or qualification necessary or desirable, except where
failure to be so licensed or qualified would not have a material
adverse effect on its financial condition or its ability to perform
i t s obligations hereunder or to consummate the transactions
contemplated hereby. Buyer has the corporate power and authority to
execute and deliver this Agreement and to perform the obligations
hereunder and to consummate the transactions contemplated hereby, and
the execution, delivery, and performance of this Agreement has been
duly authorized by all necessary corporation action. This Agreement
has been duly executed and delivered by Buyer and (assuming due
authorization, execution, and delivery by the Seller Parties)
constitutes the legal, valid and binding obligation of the Buyer,
enforceable against the Buyer in accordance with its terms.
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SECTION 5.2 No Conflict; Required Filings and Consents.
Neither the execution, delivery, and performance of this Agreement
nor the consummation by Buyer of the transactions contemplated hereby
(i) conflicts with or violates (A) any law, regulation, order, write,
injunction, decree, determination, or award of any court, any
governmental department, board, agency, or instrumentality, domestic
or foreign, or any arbitrator, applicable to Buyer, (B) the
certificate of incorporation or by-laws of Buyer, or (C) any
contract, agreement, instrument, mortgage, note, lease, or other
arrangement binding on or affecting Buyer or any of its property;
(ii) requires (A) any consent, authorization, or approval under any
contract, agreement, instrument, mortgage, note, lease, or other
arrangement to which Buyer or any of its property is bound, or (B)
any consent, approval, exemption, authorization, or permit of, filing
w i t h or notification to, or other action by, any court,
administrative agency, governmental or regulatory authority, domestic
or foreign, other than any consent, authorization or permit of,
filing with or notification to, any governmental or regulatory
authority applicable to Buyer; or (iii) results in the creation or
imposition of any Encumbrance upon any property of Buyer.
SECTION 5.3 Partnership Matters. (a) Buyer owns, as of the
date hereof and at all times prior to the Closing, a 50% partnership
interest in the Partnership, free and clear of any Encumbrance.
Buyer acknowledges that it has asked questions of management of the
Partnership and participated in meetings with management of the
P a r t nership to discuss the business and operations of the
Partnership. Buyer has the right, which Buyer has exercised, to
appoint two members of the four member Management Committee of the
Partnership, which has met from time to time. Copies of agendas,
minutes and information provided therefor are attached hereto as
Schedule 5.3. Buyer hereby confirms it has participated in the
Management Committee and hereby ratifies all of the actions taken on
behalf of the Partnership by the Management Committee and the actions
of the managing general partner of the Partnership which were not in
breach of its obligations as managing general partner and were Known
to Buyer prior to Closing.
SECTION 5.4 Brokers. No broker, finder, or investment banker
is entitled to any brokerage, finder's, or other fee or commission in
connection with the transactions hereunder based upon arrangements
made by or on behalf of Buyer. Buyer agrees to indemnify and hold
harmless the Seller Parties against any loss, liability, damage,
cost, claim, or expense incurred by reason of any brokerage,
commission, or finder's fee alleged to be payable because of any act,
omission, or statement of the Seller Parties (other than any
liability to the Seller Parties' brokers).
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SECTION 5.5 Consents. Neither the execution, delivery and
performance of this Agreement nor the consummation by Buyer of the
transactions contemplated hereby requires any consent, authorization
or approval under any contract, agreement, instrument, mortgage,
note, lease, or other arrangement to which Buyer or any of its
property is bound.
Article VI
CONDITIONS PRECEDENT
SECTION 6.1 Conditions to Buyer's Obligation to Close. The
obligation of the Buyer to purchase the Purchased Interests hereunder
shall be subject to the satisfaction and fulfillment, at or before
the Closing, of each of the following conditions precedent:
(a) Prohibition. There shall have been no order or preliminary
or permanent injunction entered in any action or proceeding before
any United States federal or state court, or any foreign court, of
c o m p etent jurisdiction or governmental authority (which has
jurisdiction over the enforcement of any applicable laws) making
i l l egal or prohibiting the consummation of the transactions
hereunder, nor shall any such order or injunction be pending or
threatened.
(b) Accuracy of the Seller Parties' Representations and
Warranties. All representations and warranties of the Seller Parties
shall be materially true on and as of the Closing Date as though made
at that time and shall be evidenced by a closing certificate. The
Seller Parties shall each have performed and complied with all of its
obligations required by this Agreement to be performed or complied
with at or prior to the Closing Date.
(c) Opinion of the Seller Parties' Counsel. The Seller Parties
shall provide Buyer with opinions of the Seller Parties's counsel,
addressed to Buyer and such other parties as Buyer shall specify,
dated as of the Closing Date, the Seller Parties' opinion to be
substantially in the form attached hereto as Exhibit 6.1(c).
(d) Additional Documents. Buyer shall have received from the
Seller Parties the Assignment and each of the instruments and other
documents referred to in this Agreement.
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(e) FIRPTA. The Seller Parties shall have given Buyer such
affidavits and certificates as Buyer may require to confirm that the
Seller Parties are not subject to withholding under Internal Revenue
Code Section 1445, and similar applicable state statutes.
(f) Necessary Consents. The Seller Parties shall deliver to
Buyer, in connection with the Real Estate Leases and where otherwise
n e c e s sary or appropriate, a landlord consent and estoppel
certificate. All necessary consents or approvals of third parties to
any of the transactions contemplated hereby, the absence of which
w o uld materially affect the business, financial condition or
operations of the Partnership, shall have been obtained and shown by
written evidence satisfactory to Buyer; provided, however, to the
extent not obtained, the Seller Parties will use their best efforts
to obtain such consents and hold harmless Buyer for the failure to
obtain any such consents.
(g) Sublease. Buyer and Aerospace shall have entered into a
sublease agreement with respect to the facility located at 15535
Texaco Avenue, Paramount, California at or prior to the Closing in
substantially the form of Exhibit 6.1(g). Sellers shall jointly and
severally undertake the obligations of Sublessor under paragraph 15
of Exhibit 6.1(g).
(h) Noncompetition Agreements. Buyer and each of Stephen T.
Braunheim and David A. Janes shall have entered into noncompetition
agreements in substantially the form of Exhibit 6.1(h).
SECTION 6.2 Conditions to the Seller Parties' Obligation.
The obligation of the Seller Parties to sell the Purchased Interests
to Buyer shall be subject to the satisfaction and fulfillment, at or
before the closing, of each of the following conditions precedent:
(a) Prohibition. There shall have been no order or preliminary
or permanent injunction entered in any action or proceeding before
any United States federal or state court, or any foreign court, of
c o m p e tent jurisdiction or governmental authority which has
jurisdiction over the enforcement of any applicable laws) making
illegal the consummation of any of the transactions hereunder.
(b) Payment of Purchase Price. Buyer shall have paid the
complete Purchase Price for the Purchased Interests.
(c) Accuracies of Buyer's Representations and Warranties. All
representations and warranties of Buyer shall be materially true on
and as of the Closing Date as though made at that time and shall be
evidenced by a closing certificate. The Buyer shall have performed
and complied with all of its obligations required by this Agreement
to be complied with at or prior to the Closing Date.
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SECTION 6.3 Deliveries by the Seller Parties. Prior to the
Closing, the Seller Parties shall deliver to Buyer the following, in
form and substance reasonably satisfactory to the Buyer:
(a) A certificate of its Secretary or an Assistant Secretary,
dated as of the Closing Date, certifying that the execution,
delivery, and performance of this Agreement, and the transactions
contemplated hereby have been duly authorized;
(b) The Closing Financial Reports; and
(c) A certificate of the Seller Parties as to the Person or
Persons authorized to execute and deliver this Agreement and any
other documents executed by or on behalf of such Seller Parties Party
in connection with the transactions contemplated hereby and as to the
genuineness of the signature(s) of such Person.
SECTION 6.4 Additional Agreements. Subject to the terms and
conditions herein provided, each of the parties hereto agrees to use
all reasonable efforts to take, or cause to be taken, all action and
to do, or cause to be done, all things necessary, proper or advisable
under applicable laws and regulations to consummate and make
effective the transactions contemplated by this Agreement, including
using all reasonable efforts to obtain all necessary waivers,
consents and approvals to effect all necessary registrations and
filings and to obtain all necessary financing. In case at any time
after the Effective Date any further action is necessary or desirable
to carry out the purposes of this Agreement, the proper officers
and/or directors of the Seller Parties and Buyer shall take all such
necessary action.
Article VII
INDEMNIFICATION
SECTION 7.1 Liabilities. For purposes of this Article VII
and subject at all times to the exclusion set forth in Section 7.5,
"Liabilities" shall mean any and all costs, liabilities, losses,
actual damages (including consequential, punitive, and natural
r e sources damages resulting from third party claims), Taxes,
penalties, fines, and assessments (whether criminal or civil),
a c tions, suits, claims, obligations, injuries, judgments,
disbursements, and demands of any kind or nature whatsoever, and,
except as otherwise expressly provided in this Article VII, shall
include all reasonable out-of-pocket costs, disbursements, and
expenses actually incurred (including reasonable consultant, expert,
and attorney's fees and expenses and costs of investigation, except
as otherwise expressly provided herein).
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SECTION 7.2 Survival of Representations and Warranties. The
covenants, agreements, indemnification obligations, representations,
and warranties of each of the parties hereto shall be continuing and
shall be true and correct on as of the Closing Date with the same
force and effect as if made at that time, and (i) the representations
and warranties in Section 3.11 shall survive the Closing until the
expiration of the applicable statute of limitations, (ii) the
representations and warranties in Section 3.10 shall survive the
Closing for a period ending on the expiration of the sublease
provided for in Section 6.1(g), and (iii) all of the remaining
representations and warranties shall survive the Closing for a period
of two years.
SECTION 7.3 Indemnification of the Seller Parties. Subject
to the exclusions stated in Section 7.5 below, Buyer hereby agrees to
defend, indemnify and hold harmless the Seller Parties, and each of
them, from and against any liabilities, claims, actions, suits,
obligations, injuries, disbursements and demands of any kind or
nature arising from any breach of this Agreement by Buyer, for any
Obligations assumed by Buyer or from any defaults under the Contracts
or Partnership Documents by Buyer or from the conduct of the business
or facilities of the Partnership from and after the Closing.
SECTION 7.4 I n demnification of Buyer. Subject to the
exclusions stated in Section 7.5 below, and without limiting any
other rights which a Buyer may have hereunder or under applicable
law, the Seller Parties, jointly and severally, hereby agree to
defend, indemnify, and hold harmless each Buyer from and against all
Liabilities that may at any time be incurred by, imposed on or
asserted against such Buyer, directly or indirectly based on, or
arising or resulting from:
(i) the breach of, or misstatement of any material
fact contained in, any representation, warranty, or agreement of the
Seller Parties not known to Buyer at the Closing Date contained in
this Agreement or in any certificate, financial statement, or other
document furnished pursuant hereto;
(ii) any claim, demand, suit or proceeding in which it
is asserted, expressly or in effect, that Buyer is responsible or
liable to any Person for any brokerage, finder's, or other fee or
commission described in Section 4.4.
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Notwithstanding any provision hereof to the contrary, the Seller
Parties shall have no obligation to indemnify Buyer under this
Article VII for any Liability with respect to the Partnership or
Article III of this Agreement in an amount greater than the Seller
Parties would have been responsible for under the Partnership
Agreement, based upon their collective percentage ownership of the
Partnership, had they not sold their Partnership Interests pursuant
to this Agreement; except to the extent and Liability arising solely
our of the breach of Aerospace's breach of its duties to Buyer.
SECTION 7.5 Exclusions. Notwithstanding any provision hereof
to the contrary, no party shall have the obligation to indemnify the
other party under this Article VII for (i) any Liability to the
extent attributable to the gross negligence or willful misconduct of,
or the falsity or inaccuracy of any material fact contained in any
representation or warranty of such party, or (ii) any Taxes payable
by a party as a result of its doing business in any jurisdiction.
Liabilities arising out of resulting from or relating to any matters
described in Section 7.3 or Section 7.4 and not excluded from
indemnification pursuant to this Section 7.5 are hereinafter referred
to as "Indemnified Liabilities."
SECTION 7.6 Indemnified Buyer Liabilities Covered by
Insurance. In the case of any Indemnified Liability to be
indemnified hereunder which is covered by a policy of
insurance held by the indemnifying party, the party to be indemnified
shall cooperate with the insurers in the exercise of their rights to
investigate, defend, or compromise such Indemnified Liability as may
be required to retain the benefits of such insurance with respect to
such Indemnified Liability. Neither any failure to cooperate that
does not cause any material damage to the indemnified party, nor any
cooperation shall have any effect or limit whatsoever on the
obligations of the indemnifying party to indemnify the indemnified
party, as set forth above.
SECTION 7.7 Control of Litigation. Any indemnified party
shall promptly notify the indemnifying party of the commencement of
any action, suit, or proceeding with respect to an Indemnified
Liability or the assertion of any Indemnified Liability, in each case
as to which indemnification is sought; provided, that the failure to
provide such notice shall not release the indemnifying party from any
of its obligations to indemnity hereunder to the extent that such
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failure does not materially prejudice the rights of the indemnifying
party in its ability to defend such Indemnified Liability, the
indemnifying party shall, at its own expense, assume or cause to be
assumed the defense of any such Indemnified Liability within thirty
(30) days after the indemnified party shall have notified the
indemnifying party thereof. Such indemnified party, upon reasonable
notice by the indemnifying party or the person assuming the defense
shall consult from time to time with respect to such Indemnified
Liability and shall provide the indemnifying party or the person
assuming the defense with any documents or other items or access to
any witness which the indemnifying party or the person assuming the
defense deems in its reasonable judgment to be necessary in
connection with the defense of such Indemnified Liability, and the
indemnifying party shall pay or reimburse or cause to be paid or
reimbursed, any reasonable out-of-pocket costs therefore. Such
indemnified party may participate in the defense of any such
Indemnified Liability and employ separate counsel, at its own
e x pense, unless such indemnified party shall have reasonably
determined that counsel selected by the indemnifying party or such
Person has an actual conflict of interest, in which case the
indemnifying party shall pay or cause to be paid the costs and
expenses of counsel employed by the indemnified party. The
indemnifying party and its insurers may in their sole discretion,
defend, settle or compromise any such action, suit, or proceeding;
provided, that the indemnifying party and its insurers shall be
liable in respect of all Indemnified Liabilities relating thereto
(whether by payment of any judgment, settlement, amount or indemnity
hereunder) and no settlement or compromise shall be entered into
unless such indemnified party is fully released or discharged from
all such Indemnified Liabilities. Participation by any such
indemnified party in any such action, suit, or claim shall not
constitute a waiver of the indemnification provided in this Article
VII. Nothing contained in this Section 7.7 shall be deemed to
require the indemnified party to contest any Indemnified Liability or
to assume responsibility for or control of any judicial proceeding
with respect thereto.
SECTION 7.8 Settlements. No indemnified party shall enter
into a settlement or other compromise with respect to any Indemnified
Liability without the prior written consent of the indemnifying
party, which consent shall not be unreasonably withheld, unless the
indemnified party waives its right to be indemnified with respect to
such Indemnified Liability under this Article VII.
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SECTION 7.9 Subrogation, Etc. To the extent that an
Indemnified Liability to be indemnified by the indemnifying party
under this Article VII is in fact paid by the indemnifying party or
any other Person, the indemnifying party or such Person shall be
subrogated to the extent of such payment to the rights and remedies
of the indemnified party with respect to the transaction, event, or
matter giving rise to such Indemnified Liability. Should the
indemnified party receive any refund, in whole or in part, with
respect to any Indemnified Liability paid by the indemnifying party
or such Person hereunder, it shall promptly pay over the amount
refunded, together with any interest received with respect to such
amount, to the indemnifying party or such Person.
SECTION 7.10 Netting of Recoveries. In determining the amount
of any indemnification or other recovery available to any indemnified
party under this Article VII, with respect to any specific claim,
such amount shall be reduced by any other amount the indemnified
party has recovered with respect to such claim.
Article VIII
NONCOMPETITION
Each of the Seller Parties agrees with Buyer that it will not:
(a) directly or indirectly, for a period of three years following the
Closing, (i) engage in (as an owner, partner, employee, agent,
consultant or otherwise) the business of aluminum or titanium heat
treating in the states of Arizona, Nevada, Oregon, Washington and
California, except to the extent solely for the use of the Seller
Parties' or their affiliates, or (ii) acquire or retain any financial
interest having a fair value in excess of the greater of $5,000 in,
or 5% of the equity of, any such business; or
(b) directly or indirectly, for a period of three years
following the Closing Date: (i) solicit any customer of the
Partnership at the Closing Date to patronize any business described
in clause (a) above; (ii) solicit from any customer of the
Partnership at the Closing Date any business similar to any of those
described in clause (a); (iii) request or advise any individual or
company which is a customer of the Partnership at the Closing to
withdraw, curtail or cancel any such customer's business with Buyer
or (iv) solicit for employment any employee of the Partnership or
Buyer.
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Article IX
INSPECTION
Buyer and its representatives, agents and designees shall have
the right at reasonable times to enter upon the Property at Buyer's
own cost and expense upon reasonable notice, for the purpose of
viewing and inspecting the Partnership assets. Buyer shall not make
any holes or excavations for inspections, and shall not to cause any
damage to the Partnership assets. Buyer shall at its own cost and
expense promptly repair any damage arising from such inspections.
Article X
DEFAULT
Notwithstanding any other provision of this Agreement, in the
event of a default by a party of any of such party's obligations
under this Agreement, the other party may, at its option: (a)
terminate this Agreement, in which event neither party shall have any
further rights or obligations hereunder; or (b) to enforce specific
performance of such party's obligations required hereby; or (c)
pursue any other right or remedy available to such party at law or
equity.
Article XI
MISCELLANEOUS
SECTION 11.1 Amendments, Etc. No amendment, modification, or
waiver of any provision of this Agreement, or consent to any
departure from the terms of this Agreement by any part hereto shall
be effective unless the same shall be in writing and signed by all
the parties hereto, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose
for which given.
SECTION 11.2 Notices, Etc. All notices, requests, claims,
demands, and other communications provided for or permitted
hereunder shall be in writing (including telecopy communication) and
shall be telecopied, mailed (registered, airmail postage and charges
prepaid), or delivered personally to the address or telecopy number
set forth on the signature pages hereof or at such other address or
telecopy number as shall be designated by a party in a written notice
to the other parties. All such notices and communications shall,
when mailed or telecopied, be effective when received at the relevant
address. Telecopied communications must be followed by a hard copy
of such telecopied communication sent by first class mail, postage
and charges prepaid.
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SECTION 11.3 No Waiver; Remedies. No failure on the part of
any party hereto to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any right hereunder preclude any other or further
exercise thereof or the exercise of any other right. The remedies
herein provided are cumulative and not exclusive of any remedies
provided by law.
SECTION 11.4 Binding Effect. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their
respective successors and assigns.
SECTION 11.5 Complete Agreement; No Other Representations or
Warranties. This Agreement, the Exhibits and Schedules and the
documents delivered or to be delivered pursuant to this Agreement
contain or will contain the entire agreement among the parties with
respect to the transactions contemplated hereby and shall supersede
a l l previous oral and written and all contemporaneous oral
negotiations, commitments and understandings. Except for the
representations and warranties contained in this Agreement and the
agreements contemplated hereby, neither the Seller Parties, the
Partnership, nor any other person acting for the Partnership or the
Seller Parties makes any representation or warranty, express or
i m p l ied, and the Seller Parties hereby disclaims any such
representation or warranty by the Seller Parties or any of its
officers, directors, employees, agents or representatives or any
other person, with respect to the execution, delivery or performance
by the Seller Parties of this Agreement or with respect to the
transactions contemplated hereby.
SECTION 11.6 Severability. Each provision of this Agreement
is intended to be severable, and if any term or provision of this
Agreement is determined to be illegal or invalid for any reason
whatsoever, such illegality or invalidity shall not affect the
validity or legality of the remainder of this Agreement.
SECTION 11.7 Counterparts. This Agreement may be signed in
any number of counterparts, each of which shall be an original and,
when taken together, shall constitute one agreement.
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SECTION 11.8 Consent to Jurisdiction. The Seller Parties and
Buyer each (i) irrevocably submits to the jurisdiction of any
California State court sitting in City of Los Angeles or the United
States District Court for the 9th District in any action arising out
of this Agreement, (ii) agrees that all claims in such action may be
decided in such court, (iii) waives, to the fullest extent it may
effectively do so, the defense of an inconvenient forum, and (iv)
consents to the service of process by mail. A final judgment in any
such action shall be conclusive and may be enforced in other
jurisdictions. Nothing herein shall affect the right of any party to
serve legal process in any manner permitted by law or shall affect
its right to bring any action in any other court.
SECTION 11.9 Governing Law. This Agreement shall be governed
by, and construed in accordance with, the internal laws of the State
of California, regardless of the law that might otherwise govern
under applicable principles of conflict of laws thereof.
SECTION 11.10 Headings. The various Article, Section, and
Paragraph headings in this Agreement are included herein for
convenience of reference only, do not constitute a part of this
Agreement for any other purpose, and shall not be considered in
interpreting this Agreement.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized representatives as of the day and
year first written above.
ALUMINUM HEAT TREATING COMPANY,
a California corporation
By: __________________________
David A. Janes,
President
By: __________________________
Stephen T. Braunheim,
Secretary
ALTA CANADA CORPORATION,
a California corporation
By: __________________________
Stephen T. Braunheim,
President
By: __________________________
David A. Janes,
Secretary
CALIFORNIA MANUFACTURING
ENTERPRISES,
a California corporation
By: __________________________
Stephen T. Braunheim,
President
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By: __________________________
David A. Janes,
Secretary
LINDBERG CORPORATION,
a California corporation
By: ___________________________
Stephen S. Penley
Its: Sr. Vice President and
Chief Financial Officer
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SCHEDULE 3.10
The soil and groundwater of the Partnership's principal facility
contains concentrations of certain chemicals as set forth in the
attached reports.
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ATTACHMENT 1
The Wiring Instructions for Alta Canada are as follows:
Bank Name: City National Bank
ABA #: 1220/16066
Account Name: Alta Canada Corp.
Account #: 016-316-849
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THIRD AMENDMENT
TO
AMENDED AND RESTATED
CREDIT AGREEMENT
THIS THIRD AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
(this "Amendment") is entered into as of September 29, 1997 among
LINDBERG CORPORATION, a Delaware corporation (the "Company"), various
financial institutions (collectively, the "Banks"), and BANK OF
AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION (successor by merger
to Bank of America Illinois), as agent for the Banks (in such
capacity, the "Agent").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Company, the Agent and the Banks are parties to an
Amended and Restated Credit Agreement dated as of April 28, 1994 (as
heretofore amended, the "Credit Agreement"); and
WHEREAS, the Company has requested that the Credit Agreement be
amended in certain respects.
NOW, THEREFORE, in consideration of the premises and mutual
agreements herein contained, the parties hereto agree as follows:
SECTION 1. DEFINED TERMS.
Terms defined in the Credit Agreement and not otherwise defined
herein are used herein as therein defined.
SECTION 2. AMENDMENTS TO CREDIT AGREEMENT. On the Effective
Date (defined below):
2.1 Section 2.1 of the Credit Agreement shall be amended by
replacing the amount "$25,000,000" where it appears at the end of
clauses (a) and (c)(y) of such Section with the amount "$35,000,000."
2.2 Section 10.7(k) of the Credit Agreement shall be amended
and restated in its entirety to read as follows:
(k) Capital Expenditures. Not and not permit any
Subsidiary to make Capital Expenditures (i) in Fiscal
Year 1997 in excess of $11,000,000 and (ii) in any
Fiscal Year thereafter in excess of $8,500,000.
<PAGE>
2.3 Section 10.9 of the Credit Agreement shall be amended and
restated to read in its entirety as follows:
10.9 Interest Coverage Ratio. Not permit the Interest
Coverage Ratio as of the last day of any Fiscal Quarter to be
less than 3.00:1.
2.4 Section 10.11 of the Credit Agreement shall be amended and
restated to read in its entirety as follows:
10.11 Funded Debt to Cash Flow Ratio. Not permit the
Funded Debt to Cash Flow Ratio as of the last day of any Fiscal
Quarter to exceed 2.50:1.
2.5 Schedule I to the Credit Agreement shall be amended by
replacing the amounts "$15,000,000", "$10,000,000" and "$25,000,000",
respectively, under the column "Amount of Revolving Commitment" with
the figures "$21,000,000", "$14,000,000" and "$35,000,000",
respectively.
SECTION 3. CONDITIONS PRECEDENT.
The amendments to the Credit Agreement set forth in
Section 2 of this Amendment shall become effective on such date
(the "Effective Date") when the following conditions precedent have
been satisfied:
3.1 Receipt of Documents. The Agent shall have received all
of the following, each duly executed and dated the date hereof, and
each in a sufficient number of signed counterparts to provide one to
each Bank:
(a) Amendment. An original of this Amendment duly
executed by the Company and each Bank and an original of
the consent attached to the foot hereof (the "Consent")
executed by Impact.
(b) Revolving Note. A Revolving Note executed by the
Company payable to the order of each Bank in an aggregate
principal amount equal to the maximum Revolving Loan
Commitment of such Bank (collectively, the "New Notes").
(c) Resolutions. A copy, certified by the secretary
or an assistant secretary of each of the Company and
Impact, of resolutions of the Board of Directors of such
Person authorizing or ratifying the execution and delivery
of (i) in the case of the Company, this Amendment and
the New Notes and the borrowings under the Credit
Agreement, as amended hereby and (ii) in the case of
Impact, the Consent.
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(d) Incumbency and Signatures. A certificate of the
secretary or an assistant secretary of each of the Company
and Impact certifying the names of the officer or officers
of such Person authorized to sign (i) in the case of the
Company, this Amendment and the New Notes and (ii) in the
case of Impact, the Consent, together with a sample of the
true signature of each such officer.
(e) Certificate. A certificate, dated the Effective
Date and signed by a duly authorized representative of the
Company, as to the matters set forth in Section 3.2, in
form and substance satisfactory to the Agent.
(f) Other. Such other documents as the Agent or any
Bank may reasonably request.
3.2 Warranties True and Absence of Defaults. (i) No Event of
Default or Unmatured Event of Default shall have occurred and shall
be continuing as of the Effective Date (after giving effect to this
Amendment) and (ii) the warranties set forth in the Credit Agreement
and each other Loan Document shall be true and correct in all
material respects with the same effect as if made on the Effective
Date.
SECTION 4. MISCELLANEOUS.
4.1 Governing Law. This Amendment shall be a contract made
under and governed by the internal laws of the State of Illinois.
4.2 Counterparts. This Amendment may be executed in any number
of counterparts, and by the parties hereto on the same or separate
counterparts, and each such counterpart, when so executed and
delivered, shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same
instrument.
4.3 References to Credit Agreement. Except as amended hereby,
the Credit Agreement shall remain in full force and effect and
is hereby ratified and confirmed in all respects. On and after the
effectiveness hereof, each reference in the Credit Agreement to
"this Agreement," "hereunder," "hereof," "herein" or words of like
import, and each reference to the Credit Agreement in any Note or
other Loan Document, shall be deemed a reference to the Credit
Agreement, as amended hereby.
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed by their respective officers thereunto duly
authorized as of the date and year first above written.
LINDBERG CORPORATION
By: ___________________________________
Title:
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION, as Agent
By: ___________________________________
Title:
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS, as a Bank
By: ___________________________________
Title:
HARRIS TRUST AND SAVINGS BANK
By: ___________________________________
Title:
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The undersigned, Impact Industries, Inc., hereby acknowledges,
consents and agrees to the foregoing Amendment, and reaffirms that
its obligations under the Guaranty dated as of April 29, 1994
executed in favor of the Agent and the Banks continue in full force
and effect with respect to the Credit Agreement, as amended by the
foregoing Amendment.
IMPACT INDUSTRIES, INC.
By: ___________________________________
Title:
