- --------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1998
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 number 1-9487
ATLANTIS PLASTICS, INC.
(Exact name of registrant as specified in its charter)
FLORIDA 06-1088270
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1870 The Exchange, Suite 200, Atlanta, Georgia 30339
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including Area Code) (800) 497-7659
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X . No_____.
Indicate the number of shares outstanding of each of the issuer's classes of
Common Stock, as of the latest practicable date.
CLASS SHARES OUTSTANDING AT MARCH 31, 1998
------------ -----------------------------
A, $.10 par value 4,622,937
B, $.10 par value 2,945,605
<PAGE>
ATLANTIS PLASTICS, INC.
TABLE OF CONTENTS
PAGE NO.
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PART I. FINANCIAL INFORMATION
Consolidated Statements of Income (Unaudited) for the
three months ended March 31, 1998 and 1997...................... 1
Consolidated Balance Sheets (Unaudited) as of
March 31, 1998 and December 31, 1997............................ 2
Consolidated Statements of Cash Flows (Unaudited) for the
three months ended March 31, 1998 and 1997...................... 3
Notes to Consolidated Financial Statements (Unaudited).......... 4
Management's Discussion and Analysis
of Financial Condition and Results of Operations................ 7
PART II. OTHER INFORMATION
Item 1 - Legal Proceedings..................................... 11
Item 6 - Exhibits and Reports on Form 8-K...................... 11
SIGNATURES............................................................... 12
<PAGE>
ATLANTIS PLASTICS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED - IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
---------------------------------
THREE MONTHS ENDED
MARCH 31,
----------------------------------
1998 1997
----------------------------------
<S> <C> <C>
Net sales..................................................... $64,427 $64,323
Cost of sales................................................. 53,138 55,136
--------------- ---------------
GROSS PROFIT............................... 11,289 9,187
Selling, general and administrative expenses.................. 5,973 6,430
Impairment of long-lived assets and restructuring charges..... - 960
--------------- ---------------
OPERATING INCOME........................... 5,316 1,797
Net interest expense.......................................... (2,748) (2,837)
--------------- ---------------
INCOME (LOSS) BEFORE INCOME TAXES.......... 2,568 (1,040)
Income tax (provision) benefit................................ (881) 327
--------------- ---------------
NET INCOME (LOSS).......................... $1,687 ($713)
=============== ===============
NET INCOME (LOSS) PER COMMON SHARE
Basic $0.23 ($0.10)
Diluted $0.22 ($0.10)
Weighted-average number of shares used in computing
income (loss) per share (in thousands):
Basic 7,347 7,203
Diluted 7,617 7,203
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED).
1
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ATLANTIS PLASTICS, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED - IN THOUSANDS)
<TABLE>
<CAPTION>
--------------- ---------------
MARCH 31, DECEMBER 31,
1998 1997
--------------- ---------------
<S> <C> <C>
ASSETS
Cash and equivalents......................................................... $11,153 $8,346
Accounts receivable, net..................................................... 26,116 25,444
Inventories.................................................................. 18,545 18,517
Other current assets......................................................... 6,290 7,448
--------------- ---------------
Current assets........................................................... 62,104 59,755
Property and equipment, net.................................................. 59,887 60,065
Goodwill, net of accumulated amortization.................................... 48,568 48,961
Other assets................................................................. 1,994 2,108
--------------- ---------------
Total assets............................................................. $172,553 $170,889
=============== ===============
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable and accrued expenses........................................ $24,055 $24,146
Current portion of long-term debt............................................ 3,256 3,254
--------------- ---------------
Current liabilities...................................................... 27,311 27,400
Long-term debt, less current portion......................................... 101,199 101,862
Deferred income taxes........................................................ 8,366 8,287
Other liabilities............................................................ 710 791
--------------- ---------------
Total liabilities........................................................ 137,586 138,340
--------------- ---------------
Commitments and contingencies - -
Shareholders' equity:
Class A Common Stock, $.10 par value, 20,000,000 shares authorized,
4,622,937 and 4,358,516 shares issued and outstanding in 1998 and 1997... 462 436
Class B Common Stock, $.10 par value, 7,000,000 shares authorized,
2,945,605 and 2,742,280 shares issued and outstanding in 1998 and 1997... 295 274
Additional paid-in capital................................................. 8,791 7,117
Notes receivable from sale of Common Stock................................. (990) -
Retained earnings.......................................................... 26,409 24,722
--------------- ---------------
Total shareholders' equity............................................... 34,967 32,549
--------------- ---------------
$172,553 $170,889
=============== ===============
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED).
2
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ATLANTIS PLASTICS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED - IN THOUSANDS)
<TABLE>
<CAPTION>
---------------------------------
THREE MONTHS ENDED
MARCH 31,
----------------------------------
1998 1997
----------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)............................................. $1,687 ($713)
--------------- ---------------
Adjustments to reconcile net income (loss) to
net cash provided by (used in) operating activities:
Depreciation.............................................. 1,959 1,792
Amortization of goodwill.................................. 393 399
Loan fee and other amortization........................... 106 141
Changes in assets and liabilities:
Increase in accounts receivable....................... (672) (1,240)
Increase in inventories............................... (28) (1,000)
Decrease in other current assets...................... 1,158 314
Decrease in accounts payable and accrued expenses..... (91) (5,167)
Increase in deferred income taxes..................... 79 129
Decrease in other liabilities......................... (81) (72)
Other, net............................................ 8 277
--------------- ---------------
Total adjustments..................................... 2,831 (4,427)
--------------- ---------------
Net cash provided by (used in) operating activities.. 4,518 (5,140)
--------------- ---------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures........................................ (1,781) (1,408)
--------------- ---------------
Net cash used in investing activities................ (1,781) (1,408)
--------------- ---------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on long-term debt.................................. (661) (665)
Purchases of Common Stock................................... - (2,994)
Proceeds from exercise of stock options..................... 731 64
--------------- ---------------
Net cash provided by (used in) financing activities.. 70 (3,595)
--------------- ---------------
Net increase (decrease) in cash and equivalents............... 2,807 (10,143)
Cash and equivalents at beginning of period................... 8,346 15,905
--------------- ---------------
Cash and equivalents at end of period......................... $11,153 $5,762
=============== ===============
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED).
3
<PAGE>
ATLANTIS PLASTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. The accompanying unaudited consolidated financial statements
of Atlantis Plastics, Inc. and Subsidiaries ("Atlantis" or the
"Company"), do not include all disclosures provided in the annual
consolidated financial statements. These unaudited consolidated
financial statements should be read in conjunction with the
consolidated financial statements and the footnotes thereto contained
in the Company's Annual Report on Form 10-K for the year ended December
31, 1997 as filed with the Securities and Exchange Commission. The
December 31, 1997 balance sheet, included herein, was derived from
audited financial statements, but does not include all disclosures
required by generally accepted accounting principles.
Atlantis Plastic Films accounts for approximately
three-quarters of the Company's net sales and produces: (i) stretch
films (multilayer plastic films that are used principally to wrap
pallets of materials for shipping or storage), (ii) custom film
products (high-grade laminating films, embossed films, and specialty
film products targeted primarily to industrial and packaging markets),
and (iii) institutional products such as aprons, gloves, and
tablecloths which are converted from polyethylene films.
Atlantis Molded Plastics accounts for approximately
one-quarter of the Company's net sales and employs two principal
technologies, serving a wide variety of specific market segments,
described as follows: (i) injection molded thermoplastic parts that are
sold primarily to original equipment manufacturers and used in major
household goods and appliances, power tools, and agricultural and
automotive products, and (ii) a variety of custom and proprietary
extruded plastic parts for both trim and functional applications
(profile extrusion) that are incorporated into a broad range of
consumer and commercial products such as recreational vehicles,
residential windows and doors, office furniture, building supplies, and
retail store fixtures.
All material intercompany balances and transactions have been
eliminated. Certain amounts included in prior period financial
statements have been reclassified to conform with the current period
presentation.
2. In the opinion of the Company, the accompanying unaudited
consolidated financial statements contain all adjustments, which are of
a normal recurring nature and necessary for a fair presentation of the
financial statements. The results of operations for the three months
ended March 31, 1998 are not necessarily indicative of the results to
be expected for the full year.
3. In the first quarter of 1998, the Company adopted Statement of
Financial Accounting Standards ("SFAS") No. 130, "Reporting
Comprehensive Income", which establishes standards for the reporting
and display of comprehensive income and its components in a full set of
general-purpose financial statements. This implementation required no
additional disclosure by the Company.
4. During the first quarter of 1997, the Company recorded
impairment of long-lived assets and other restructuring charges of
$960,000, or $586,000 after taxes, related to: (i) the closing of the
Company's Nashville, Tennessee injection molding facility, including
approximately $250,000 in non-cash charges for
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the write-down of fixed assets and leasehold improvements associated
with that facility, and (ii) restructuring expenses associated with
management changes in the Company's stretch film unit. Anticipated
costs (primarily severance and moving costs) associated with the
closing of the Nashville facility were reduced by $145,000 in the
second half of 1997.
5. In November 1996, the Board of Directors authorized the
repurchase of up to 1,000,000 shares of Atlantis Class A Common Stock,
or 14% of the 7.1 million Class A and Class B Common Stock then
outstanding. Through June 1997, the Company had repurchased 320,344
shares (including 210,244 shares issued in connection with the
conversion of Preferred Stock, described below), and options for 55,125
shares, for total consideration of approximately $3.3 million. The
Company was restricted from repurchases during the second half of 1997
since it fell below the fixed charge ratio specified in the 11% Senior
Note Indenture. As of December 31, 1997, the Company exceeds this fixed
charge ratio and, accordingly, has the ability to repurchase shares of
its Common Stock under its share repurchase program effective February
11, 1998.
In January 1997, the Company issued a mandatory conversion
notice to the holder of the 20,000 outstanding shares of the Company's
Series A Preferred Stock ("Preferred Stock"). The Preferred Stock was
convertible into 210,244 shares of Class A Common Stock. After issuing
the mandatory conversion notice, the Company reached an agreement with
the Preferred Stock holder to repurchase all of the common shares
resulting from the conversion notice for $2 million (the original price
paid for the Preferred Stock by the holder and included in the $3.3
million consideration cited earlier in this Note), and completed the
repurchase in late March, 1997. Prior to this conversion, each share of
Preferred Stock had a liquidation preference of $100, and the holder of
the Preferred Stock was entitled to an annual cumulative dividend,
payable in equal semiannual installments of $72,500 on April 15 and
October 15 of each year.
6. In June 1997, SFAS No. 131, "Disclosures About Segments of an
Enterprise and Related Information" was issued. SFAS 131
establishes standards for the way that public businesses report
information about operating segments in annual financial statements,
and requires that those enterprises report selected information about
operating segments in interim financial reports issued to shareholders.
It also establishes standards for related disclosures about products
and services, geographic areas, and major customers. The Company has
not yet determined the impact of SFAS 131 on its future disclosures.
SFAS 131 must be implemented for fiscal years ending after December 15,
1998.
In February 1998, SFAS No. 132, "Employers' Disclosures about
Pensions and Other Postretirement Benefits" was issued. This Statement
does not apply to the Company.
This Form 10-Q contains certain forward-looking statements
which are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements involve risks and uncertainties that could cause actual
results to differ materially from these statements. These risks
include, but are not limited to, raw material costs and the ability to
pass price increases to customers in a timely fashion, industry
overcapacity, product acceptance, technological changes which could
alter the demand for product or adversely impact the competitive cost
of production, etc. All forward-looking statements should be considered
in light of these risks and uncertainties.
5
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
GENERAL
Atlantis is a leading U.S. manufacturer of polyethylene stretch and
custom films used in a variety of industrial and consumer applications and
molded plastic products for the appliance, automotive, building supply, and
recreational vehicle industries.
Selected income statement data for the quarterly periods ended March
31, 1997 through March 31, 1998 are as follows:
<TABLE>
<CAPTION>
($ in millions) 1998 1997
---- --------------------------------------------
Q1 Q4 Q3 Q2 Q1
-- -- -- -- --
<S> <C> <C> <C> <C> <C>
NET SALES
Plastic Films $44.9 $45.6 $47.6 $48.1 $45.7
Molded Plastics 19.5 16.8 16.3 17.4 18.6
----- ---------------------------------------------
TOTAL $64.4 $62.3 $63.9 $65.5 $64.3
===== =============================================
PERCENTAGE OF NET SALES
GROSS PROFIT
Plastic Films 19% 18% 17% 13% 13%
Molded Plastics 15% 17% 13% 17% 18%
----- --------------------------------------------
TOTAL 18% 17% 16% 14% 14%
===== ============================================
OPERATING INCOME
Plastic Films 9% 7% 8% 3% 3%(a)
Molded Plastics 6% 5%(a) 2%(a) 6% 8%(a)
----- --------------------------------------------
TOTAL 8% 7%(a) 6%(a) 4% 4%(a)
===== ============================================
NET INTEREST EXPENSE $2.7 $2.8 $2.9 $2.9 $2.8
===== ============================================
</TABLE>
(a) Amounts exclude the effects of the 1997 impairment of long-lived assets and
restructuring charges totaling $815,000 and more fully described in Note 4 of
Notes to the Consolidated Financial Statements.
RESULTS OF OPERATIONS
The Company's 1998 first quarter sales of $64.4 million were comparable
to last year's sales for the same period, with increased Atlantis Molded
Plastics sales offset by lower Atlantis Plastic Film sales. Atlantis Molded
Plastics net sales for the first three months of 1998 totaled $19.5 million, or
5% higher than last year's first quarter sales of $18.6 million. First quarter
1998 Atlantis Plastic Film sales of $44.9 million were 2% lower than last year's
first quarter sales of $45.7 million, due to lower average selling prices caused
by intense competition and unchanged volume (measured in pounds).
6
<PAGE>
The Company's first quarter gross profit margins increased from 14% in
1997 to 18% in 1998, primarily due to improved gross profit margins in Atlantis
Plastic Films which increased from 13% in 1997 to 19% in 1998. This increase is
largely due to continued cost reduction measures, including improved gross
spreads in Stretch Film. First quarter gross profit margins in the Molded
Plastics segment declined from 18% in 1997 to 15% in 1998 primarily due to a
change in the mix of production in the injection molded units.
Selling, general, and administrative ("SG&A") expenses were $6.0
million for the first quarter of 1998 compared to $6.4 million for this period
last year. This decrease is partially attributable to the reduction in
management fees payable to Trivest, Inc. and the termination of the employment
agreements between the Company and the Chairman of the Board of Directors and
the Chairman of the Executive Committee of the Board of Directors. The 1997
expenses exclude restructuring charges taken in 1997 as described further below.
The Company has reduced SG&A expenses by approximately 20% since the beginning
of 1995 through a series of cost reduction and restructuring programs.
Management does not anticipate further substantial reductions in SG&A in the
immediate future.
In the first quarter of 1997, the Company incurred a $960,000
restructuring charge related to estimated costs associated with the above
mentioned closing of its Nashville injection molding facility and management
changes implemented in May, 1997 in the Company's stretch film unit. Anticipated
costs (primarily severance and moving costs) associated with the closing of the
Nashville facility were reduced by $145,000 in the second half of 1997.
First quarter net interest expense equaled $2.7 million, reflecting a
3% reduction from 1997 levels as a result of reduced debt levels in 1998
compared to 1997. Effective tax rates differed from applicable statutory rates
in both 1998 and 1997, primarily due to nondeductible goodwill amortization.
LIQUIDITY AND CAPITAL RESOURCES
The Company's working capital at March 31, 1998 totaled approximately
$34.8 million (including cash and equivalents of $11.2 million), compared to
$32.4 million (including cash and equivalents of $8.3 million) at December 31,
1997. On March 31, 1998 there were no borrowings on the Company's revolving
credit facility. Unused availability, net of outstanding letters of credit of
approximately $1.0 million, equaled $14.0 million.
The Company's primary needs for liquidity, on both a short- and
long-term basis, relate to working capital (principally accounts receivable and
inventories), debt service, and capital expenditures. The Company presently does
not have any material commitments for future capital expenditures, and expects
to meet its short- and long-term liquidity needs with cash on hand, funds
generated from operations, and funds available under its revolving credit
facility.
CASH FLOWS FROM OPERATING ACTIVITIES
In the first three months of 1998, net cash provided by operating
activities was approximately $4.5 million, compared to cash used in operations
of $5.1 million for the same period last year. Accounts receivable increased
$672,000 during the first quarter of 1998 due to higher sales during the month
of March 1998 compared to December 1997. Inventory levels remained relatively
unchanged in the first quarter of 1998 compared to an increase of $1.0 million
in 1997, which was caused by month-end March 1997 inventory purchases by
Atlantis
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Plastic Films in advance of announced price increases by the Company's resin
suppliers. Other current assets decreased by $1.2 million during the first
quarter primarily due to payments received on resin rebates receivable
outstanding at the end of 1997.
Accounts payable and accrued expenses decreased $91,000 in the first
quarter of 1998 compared to a decline of $5.2 million in 1997. The large
decrease in 1997 was primarily due to incentive compensation and income tax
payments made during the first quarter of 1997 related to 1996 operating
results.
CASH FLOWS FROM INVESTING ACTIVITIES
Net cash used in investing activities during the first three months of
1998 consisted of capital expenditures totaling $1.8 million, compared to
capital expenditures of $1.4 million for the same period last year.
CASH FLOWS FROM FINANCING ACTIVITIES
Net cash provided by financing activities for the first three months of
1998 was $70,000, compared to cash used by investing activities of $3.6 million
during this period last year. Proceeds from the exercise of stock options
equaled $731,000 during the first three months of 1998, compared to $64,000
during the same period in 1997. Additionally, cash was used during 1997 to
repurchase approximately $3.0 million of Common Stock.
FORWARD LOOKING STATEMENTS
This Form 10-Q contains certain forward-looking statements which are
made pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. These forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially from these
statements. These risks include, but are not limited to, raw material costs and
the ability to pass price increases to customers in a timely fashion, industry
overcapacity, product acceptance, technological changes which could alter the
demand for product or adversely impact the competitive cost of production, etc.
All forward-looking statements should be considered in light of these risks and
uncertainties.
8
<PAGE>
ACCOUNTING PRONOUNCEMENTS
In June 1997, SFAS No. 131, "Disclosures About Segments of an
Enterprise and Related Information" was issued. SFAS 131 establishes
standards for the way that public businesses report information about operating
segments in annual financial statements, and requires that those enterprises
report selected information about operating segments in interim financial
reports issued to shareholders. It also establishes standards for related
disclosures about products and services, geographic areas, and major customers.
The Company has not yet determined the impact of SFAS 131 on its future
disclosures. SFAS 131 must be implemented for fiscal years ending after December
15, 1998.
In February 1998, SFAS No. 132, "Employers' Disclosures about Pensions
and Other Postretirement Benefits" was issued. This Statement does not apply to
the Company.
9
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PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
The Company is not a party to any legal proceeding other than routine
litigation incidental to its business, none of which is material.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
10.1 Management Agreement dated as of January 1, 1998 between Registrant and
Trivest, Inc.
10.2 Agreement dated January 1, 1998 by and among Registrant, Trivest II,
Inc., Earl W. Powell, and Phillip T. George, M.D.
27.1 Financial Data Schedule
- ----------
(b) Reports on Form 8-K:
During the quarter for which this Quarterly Report on Form 10-Q is
filed, no reports on Form 8-K were filed by the Registrant.
10
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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 thereunto duly authorized.
ATLANTIS PLASTICS, INC.
Date: April 30, 1998 /S/ ANTHONY F. BOVA
-------------------
ANTHONY F. BOVA
President and Chief Executive Officer
Date: April 30, 1998 /S/ PAUL RUDOVSKY
-----------------
PAUL RUDOVSKY
Executive Vice President, Finance and
Administration
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EXHIBIT INDEX
EXHIBIT DESCRIPTION
- ------- -----------
10.1 Management Agreement dated as of January 1, 1998 between Registrant and
Trivest, Inc.
10.2 Agreement dated January 1, 1998 by and among Registrant, Trivest II,
Inc., Earl W. Powell, and Phillip T. George, M.D.
27.1 Financial Data Schedule
EXHIBIT 10.1
MANAGEMENT AGREEMENT
This Agreement is made and entered into as of January 1, 1998, by and
between ATLANTIS PLASTICS, INC., a Florida corporation (the "COMPANY"), and
TRIVEST, INC., a Delaware corporation or its successors (the "MANAGER").
PRELIMINARY STATEMENTS:
A. The Manager and the Company are parties to that certain Fourth
Amended and Restated Management Agreement, dated as of October 19, 1992 (the
"PRIOR AGREEMENT").
B. The Prior Agreement terminated on December 31, 1997 and the Company
desires to continue to engage the services of the Manager on the terms and
subject to the conditions contained in this Agreement.
In consideration of the premises and the respective mutual agreements,
covenants, representations and warranties contained in this Agreement, the
parties agree as follows:
AGREEMENT:
1. CONTINUATION OF MANAGER. The Company continues the engagement of the
Manager and the Manager accepts such continuation on the terms and conditions
provided in this Agreement as the sole and exclusive manager and consultant of
the Company's business, including without limitation, the business of the
Company's subsidiaries, as well as any other corporations or entities now
existing or hereafter formed or acquired by the Company or any of its
subsidiaries to engage in any business. The Manager's duties hereunder shall
include, but shall not be limited to, identifying executive personnel for the
Company (including a President, a Chief Financial Officer and such additional
officers approved by the Board of Directors of the Company (the "Board")), whose
compensation shall be the responsibility of the Company.
2. BOARD OF DIRECTORS SUPERVISION. The activities of the Manager to be
performed under this Agreement shall be subject to the supervision of the Board
to the extent required by applicable law or regulation and subject to reasonable
policies not inconsistent with the terms of this Agreement adopted by the Board
and in effect from time to time. Where not required by applicable law or
regulation, the Manager shall not require the prior approval of the Board to
perform its duties under this Agreement.
3. AUTHORITY OF MANAGER. Subject to any limitations imposed by
applicable law or regulation, the Manager shall render management, consulting
and financial services to the Company and its subsidiaries which services shall
include advice and assistance concerning any and all aspects of the operations,
planning and financing of the Company and its subsidiaries as needed from time
to time. In addition, the Manager shall render advice and expertise in
connection with an acquisition
1
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program for the Company and shall from time to time bring to the attention of
the Company and its subsidiaries, such investment and business opportunities as
the Manager, in its sole discretion, deems appropriate.
4. REIMBURSEMENT OF EXPENSES; INDEPENDENT CONTRACTOR. All obligations
or expenses incurred by the Manager in the performance of its duties under this
Agreement shall be for the account of, on behalf of, and at the expense of the
Company and/or its subsidiaries, as the case may be. The Manager shall not be
obligated to make any advance to or for the account of the Company (or any
subsidiary) or to pay any sums, except out of funds held in accounts maintained
by the Company (or a subsidiary) nor shall the Manager be obligated to incur any
liability or obligation for the account of the Company or any subsidiary without
assurance that the necessary funds for the discharge of such liability or
obligation will be provided. The Manager shall be an independent contractor, and
nothing contained in this Agreement shall be deemed or construed (i) to create a
partnership or joint venture between the Company and/or any subsidiary of the
Company and the Manager, or (ii) to cause the Manager to be responsible in any
way for the debts, liabilities or obligations of the Company or any of its
subsidiaries, or any other party, or (iii) to constitute the Manager or any of
its employees as employees, officers, or agents of the Company or any of its
subsidiaries.
5. OTHER ACTIVITIES OF MANAGER; INVESTMENT OPPORTUNITIES.
5.1 GENERAL. The Company and its subsidiaries acknowledge and agree
that the Manager shall not devote the Manager's (or any employee, officer,
director, affiliate or associate of the Manager) full time and business efforts
to the duties of the Manager specified in this Agreement, but only so much of
such time and efforts as the Manager reasonably deems necessary. The Company and
its subsidiaries further acknowledge and agree that the Manager and its
affiliates are engaged in the business of investing in, acquiring and/or
managing businesses for the Manager's own account, for the account of the
Manager's affiliates and associates and for the account of other unaffiliated
parties, and plans to continue to be engaged in such business (and any other
business or investment activities) during the term of this Agreement. No aspect
or element of such activities shall be deemed to be engaged in for the benefit
of the Company or any of its subsidiaries nor to constitute a conflict of
interest. The Manager shall be required to bring only such investments and/or
business opportunities to the attention of the Company and its subsidiaries as
the Manager, in its sole discretion, deems appropriate.
5.2 DESIGNATED LINE OF BUSINESS; NEW BUSINESS SEGMENTS; PROHIBITED
LINES OF BUSINESS.
(a) Subject to the provisions of the last sentence of this
Section 5.2(a), the Manager, its officers, directors, and affiliates (other than
the Company and its subsidiaries) shall not invest in, acquire, manage, or
otherwise provide services (including acquisition or investment banking
services) with respect to, any firm, corporation, partnership or other entity
principally engaged in business activities in the plastics industry (the
"DESIGNATED LINE OF BUSINESS"). The
2
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restriction contained in the preceding sentence shall apply to and be binding
upon the Manager regardless of whether the Board elects to pursue or not to
pursue any investment opportunity related to the Designated Line of Business
which is brought to the attention of the Company, by the Manager or otherwise;
PROVIDED, HOWEVER, that one or more affiliates of the Manager shall be entitled
to invest in, acquire, manage and/or otherwise provide services (including
acquisition or investment banking services) with respect to, any firm,
corporation, partnership or other entity engaged in the Designated Line of
Business (a "PLASTICS ENTITY"), if (i) prior to undertaking such investment,
management or provision of services, information (including business and
financial information in reasonable detail) regarding the Plastics Entity,
together with the material terms of the proposed contract or transaction, are
disclosed to the Board, and (ii) the Board (and at least a majority of the
disinterested members thereof) authorizes such contract or transaction and
expressly waives the prohibition otherwise imposed by this Section 5.2(a).
(b) The Company acknowledges that it has no present intention
to acquire substantially all of the assets of or a controlling interest in any
firm, corporation, partnership or other entity which is not engaged in the
Designated Line of Business (a "NEW BUSINESS SEGMENT"). In the event the Board
shall determine to make such an acquisition and shall so notify the Manager in
writing, then any such New Business Segment shall be deemed to be a Designated
Line of Business for purposes of this Agreement; provided, however, that in the
event the Manager shall, at the time of such notification, (i) own a controlling
interest in, manage, or otherwise provide services (including Acquisition or
investment banking services) with respect to, or (ii) have a binding commitment
to invest in, acquire, manage, or otherwise provide services (including
acquisition or investment banking services) with respect to, any New Business
Segment, for its own account or on behalf of any person other than the Company,
and shall so notify the Board in writing, then such New Business Segment shall
not be deemed to be a Designated Line of Business.
(c) Notwithstanding any provision of this Section 5.2 which
may be to the contrary, the Manager, its officers, directors and affiliates
shall be entitled to make investments in (i) securities of the Company, or (ii)
no more than 5% of any class of securities of any corporation, partnership or
other entity engaged in a Designated Line of Business, which securities are
listed and registered on a national securities exchange or which are quoted on
the NASDAQ Interdealer Quotation System.
(d) The Manager shall use its reasonable best efforts to
identify and bring to the attention of the Company acquisition candidates
engaged in the Designated Line of Business.
6. COMPENSATION OF MANAGER.
6.1 MANAGEMENT FEE. During the term of this Agreement, the
Manager will receive annually with respect to the management of the business
operations of the Company, a cash consulting and management fee in the amount of
$750,000 ("BASE COMPENSATION"). The Base Compensation will be paid to the
Manager by the Company in advance in equal quarterly installments. The Base
Compensation will be adjusted annually during the term hereof to reflect any
3
<PAGE>
increase from the previous year in the consumer price index, with the first such
adjustment to occur as of January 1, 1999. For purposes of this Agreement, the
consumer price index to be used will be the "Consumer Price Index for Miami
Urban Consumers", published by the United States Department of Labor, Bureau of
Labor Statistics. If the U.S. Department of Labor ceases to prepare a consumer
price index, and there is no successor, then an equivalent index will be used,
prepared by an agency of the U.S. Government, or by a responsible financial
periodical of recognized authority, to be selected by mutual agreement of the
Company and the Manager. If the parties are unable to agree upon a successor,
the parties will refer the choice of a successor to arbitration in Miami,
Florida in accordance with the rules of the American Arbitration Association,
which determination will be final. The parties will share equally the cost of
arbitration.
6.2 ADDITIONAL BUSINESS OPERATIONS. If the Company or its
subsidiaries acquire or enter into any additional business operations after the
date of this Agreement (each an "Additional Business"), the Board and the
Manager will, prior to the acquisition or prior to entering into the business
operations, in good faith, determine whether and to what extent the Base
Compensation should be increased as a result thereof. Any increase will be
evidenced by a written supplement to this Agreement signed by the Company and
the Manager.
6.3 INCENTIVE COMPENSATION.
(a) As additional compensation, beginning with the
Company's fiscal year ending December 31, 1998 and continuing for each fiscal
year during which this Agreement is in effect, the Manager will be entitled to
an annual incentive compensation payment in an amount equal to 1% of the
Company's EBITDAM for such year, provided that EBITDAM for such year is greater
than $20,000,000 (the "INCENTIVE COMPENSATION"). Any Incentive Compensation
payable with respect to any such fiscal year shall be paid by the Company to the
Manager within 75 days after the end of such fiscal year; PROVIDED, HOWEVER,
that the Compensation Committee of the Board may approve the payment of an
estimated amount of Incentive Compensation (the "ESTIMATED INCENTIVE
COMPENSATION") with respect to any such fiscal year in such installments as such
Committee shall deem appropriate. In the event that the Estimated Incentive
Compensation (if any) paid to the Manager with respect to any such fiscal year
is greater than the actual amount of Incentive Compensation that is finally
determined to have been payable with respect to such fiscal year, than the
Manager shall promptly repay the amount of such excess to the Company. In the
event that the Estimated Incentive Compensation (if any) paid to the Manager
with respect to any such fiscal year is less than the actual amount of Incentive
Compensation that is finally determined to have been payable with respect to
such fiscal year, than the Company shall promptly pay the amount of such
deficiency to the Manager.
(b) Notwithstanding any provision hereof which may be
to the contrary, in the event any Incentive Compensation with respect to any
fiscal year of the Company is paid prior to the issuance of the Company's
regularly prepared financial statements for such fiscal year, any amount paid
shall be subject to increase or decrease based upon the results of such
financial statements.
4
<PAGE>
(c) For purposes of this Section 6.3, "EBITDAM" means
the Company's earnings before net interest expense, income taxes, depreciation,
amortization and any compensation incurred by the Company to the Manager
hereunder.
(d) In the event that the Manager's engagement
hereunder is terminated pursuant to Section 8.1 or Section 8.3 below, then
notwithstanding the fact that the Manager is not engaged by the Company through
the end of the fiscal year in which such termination occurs, the Manager shall
be entitled to receive the Incentive Compensation that would have otherwise been
payable to it had it been engaged hereunder through the end of such fiscal year,
pro rated based upon the number of days elapsed in such year through the
effective date of such termination. In the event that the Manager's engagement
hereunder is terminated pursuant to Section 8.4 below, then the amount (if any)
of Incentive Compensation to be paid to the Manager in respect of the number of
days elapsed in the fiscal year in which such termination occurs through the
effective date of such termination will be determined through good faith
negotiations between the Board and the Manager. If the Board and the Manager are
unable to agree upon the amount of Additional Incentive Compensation, the
Additional Incentive Compensation amount will be determined by arbitration in
Miami, Florida in accordance with the rules of the American Arbitration
Association, which determination will be final. The parties will share equally
the cost of arbitration.
6.4 ADDITIONAL INCENTIVE COMPENSATION. As additional
compensation, the Manager will be entitled to a one-time fee with respect to the
acquisition or disposition of any business operation by the Company or its
subsidiaries introduced or negotiated by the Manager or its affiliates or with
respect to any other transaction not in the ordinary course of business,
including any public or private debt or equity financing or unusual efforts
extended or results obtained by the Manager on behalf or for the benefit of the
Company or its subsidiaries ("ADDITIONAL INCENTIVE COMPENSATION"). The
Additional Incentive Compensation will be paid at the closing of any such
transaction. The amount of any Additional Incentive Compensation will be
determined through good faith negotiations between the Board and the Manager. If
the Board and the Manager are unable to agree upon the amount of Additional
Incentive Compensation, the Additional Incentive Compensation amount will be
determined by arbitration in Miami, Florida in accordance with the rules of the
American Arbitration Association, which determination will be final. The parties
will share equally the cost of arbitration.
6.5 COMPANY'S RIGHT TO ENGAGE OTHER FINANCIAL ADVISORS.
Notwithstanding any provision of this Agreement which may be to the contrary,
the Manager acknowledges and agrees that the Company may from time to time
engage the services of financial advisors in addition to the Manager in
connection with certain acquisitions, dispositions and financing transactions
if, in the judgment of the Board, such engagement is in the best interest of the
Company and its shareholders.
7. TERM. This Agreement shall commence as of the date hereof and shall
remain in effect until December 31, 2002, unless terminated earlier in
accordance with the provisions of this Agreement.
5
<PAGE>
8. TERMINATION.
8.1 BY SHAREHOLDER ACTION. The Board may terminate the
Manager's engagement under this Agreement at any time upon a majority vote of
all of the then outstanding voting shares of capital stock of the Company at the
time of such vote (including capital stock held by the Manager, its officers,
directors and affiliates, each of whom shall be entitled to vote).
8.2 UPON BREACH. Either the Company or the Manager may
terminate the Manager's engagement under this Agreement in the event of the
breach of any of the material terms or provisions of this Agreement by the other
party, which breach is not cured within 10 business days after notice of the
same is given to the party alleged to be in breach by the other party. In the
event this Agreement is terminated by the Manager because of the breach of any
of the material terms or provisions hereof by the Company, the Manager shall be
entitled to recover damages from the Company and shall not be required to
mitigate or reduce damages by seeking or undertaking other management
arrangements or business opportunities.
8.3 CHANGE IN SENIOR MANAGEMENT OF MANAGER. The Board may
terminate the Manager's engagement under this Agreement, upon 90 days prior
notice, in the event that Earl W. Powell (or a successor to Earl W. Powell
acceptable to the Board) shall cease to serve as an executive officer of the
Manager or shall otherwise cease to be actively engaged in the Manager's
business.
8.4 CHANGE OF CONTROL. The Board may terminate the Manager's
engagement under this Agreement, by written notice to the Manager, in the event
that (i) the Board shall approve the sale of all, or substantially all, of the
Company's consolidated assets in any single transaction or series of related
transactions, (ii) there shall occur a sale or issuance, or series of related
sales or issuances, of the Company's voting securities in any single transaction
or series of related transactions which results in any person or group of
affiliated persons (other than the holders of the Company's voting securities as
of the date of this Agreement and affiliates of such holders) owning (on a
fully-diluted basis) voting securities of the Company representing (at the time
of such sale or issuance or such series of sales and/or issuances) a majority of
the ordinary voting power to elect directors of the Company or (iii) the Board
shall approve any merger or consolidation of the Company with or into another
corporation (regardless of which entity is the surviving corporation) if, after
giving effect to such merger or consolidation, the holders of the Company's
voting securities (on a fully-diluted basis) immediately prior to the merger or
consolidation own voting securities of the surviving or resulting corporation
representing less than a majority of the ordinary voting power to elect
directors of the surviving or resulting corporation (on a fully-diluted basis).
Any termination of the Manager's engagement pursuant to clause (i) or clause
(iii) of this Section 8.4 shall be effective upon the date the transaction
described therein is consummated. Any termination of the Manager's engagement
pursuant to clause (ii) of this Section 8.4 shall be effective upon the date
specified in the written notice of termination delivered to the Manager.
6
<PAGE>
9. STANDARD OF CARE. The Manager (including any person or entity acting
for or on behalf of the Manager) shall not be liable for any mistakes of fact,
errors of judgment, for losses sustained by the Company or any subsidiary or for
any acts or omissions of any kind, unless caused by intentional misconduct of
the Manager engaged by the Manager in bad faith.
10. INDEMNIFICATION OF MANAGER. The Company and its present and future
subsidiaries agree to indemnify and hold harmless the Manager and its present
and future officers, directors, affiliates, employees and agents ("INDEMNIFIED
PARTIES") to the fullest extent permitted by corporate law as if any of the
Indemnified Parties were an officer or director to the Company and/or its
subsidiaries. The Company and its subsidiaries agree to reimburse the
Indemnified Parties on a monthly basis for any cost of defending any action or
investigation (including attorney's fees and expenses) subject to an undertaking
from such Indemnified Party to repay the Company or its subsidiaries if such
party is determined not to be entitled to such indemnity.
11. NO ASSIGNMENT. Neither party shall assign, transfer or convey any
of its rights, duties or interest under this Agreement, nor shall it delegate
any of the obligations or duties required to be kept or performed by it
hereunder without the prior written consent of the other party.
12. NOTICES. All notices, requests, demands, claims and other
communications hereunder will be in writing. Any notice, request, demand, claim
or other communication hereunder shall be deemed duly given if (and then two
business days after) it is sent by registered or certified mail, return receipt
requested, postage prepaid, and addressed to the intended recipient as set forth
below:
If to the Company: Atlantis Plastics, Inc.
1870 The Exchange
Suite 200
Atlanta, Georgia 30339
Attention: President
If to the Manager: Trivest, Inc.
2665 South Bayshore Drive
Suite 800
Miami, Florida 33133
Attention: Chief Executive Officer
Either party hereto may send any notice, request, demand, claim or other
communication hereunder to the intended recipient at the address set forth above
using any other means (including personal delivery, expedited courier, messenger
service, telecopy, telex, ordinary mail or electronic mail), but no such notice,
request, demand, claim or other communication shall be deemed to have been duly
given unless and until it actually is received by the intended recipient. Either
party hereto may change the address to which notices, requests, demands, claims
and other communications hereunder are to be delivered by giving the other party
notice in the manner herein set forth.
7
<PAGE>
13. SEVERABILITY. If any term or provision of this Agreement or the
application thereof to any person or circumstance shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement, or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or enforceable, shall not be affected thereby, and each term
and provision of this Agreement shall be valid and be enforced to the fullest
extent permitted by law.
14. NO WAIVER. The failure of the Company or the Manager to seek
redress for any violation of, or to insist upon the strict performance of, any
term or condition of this Agreement shall not prevent a subsequent act by the
Company or the Manager, which would have originally constituted a violation of
this Agreement by the Company or the Manager, from having all the force and
effect of any original violation. The failure by the Company or the Manager to
insist upon the strict performance of any one of the terms or conditions of the
Agreement or to exercise any right, remedy or elections herein contained or
permitted by law shall not constitute or be construed as a waiver or
relinquishment for the future of such term, condition, right, remedy or
election, but the same shall continue and remain in full force and effect.
Except as the Company's rights of termination are limited herein, all rights and
remedies that the Company or the Manager may have at law, in equity or otherwise
upon breach of any term or condition of this Agreement, shall be distinct,
separate and cumulative rights and remedies and no one of them, whether
exercised by the Company or the Manager or not, shall be deemed to be in
exclusion of any other right or remedy of the Company or the Manager.
15. ENTIRE AGREEMENT; CERTAIN TERMS. This Agreement contains the entire
agreement between the parties hereto with respect to the matters herein
contained and supersedes all prior agreements between the parties hereto with
respect to such matters. Any agreement hereafter made shall be ineffective to
effect any change or modification to this Agreement, in whole or in part, unless
such agreement is in writing and signed by the party against whom enforcement of
the change or modification is sought.
16. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida without reference to the laws
of any other state.
8
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be duly exercised by their authorized representatives as of the date first above
written.
ATLANTIS PLASTICS, INC.
By: ____________________________
Anthony F. Bova
President and Chief Executive Officer
TRIVEST, INC.
By: ____________________________
Earl W. Powell
President and Chief Executive Officer
9
EXHIBIT 10.2
AGREEMENT
This Agreement is made and entered into as of January 1, 1998, by and
among ATLANTIS PLASTICS, INC., a Florida corporation (the "COMPANY"), TRIVEST
II, INC., a Florida Corporation ("TRIVEST II"), EARL W. POWELL ("POWELL") and
PHILLIP T. GEORGE, M.D. ("GEORGE").
PRELIMINARY STATEMENTS:
A. Trivest II's affiliate, Trivest, Inc., a Delaware corporation
("TRIVEST"), and the Company were parties to that certain Fourth Amended and
Restated Management Agreement, dated as of October 19, 1992 (the "PRIOR
MANAGEMENT AGREEMENT").
B. The Prior Agreement terminated on December 31, 1997 and, in
connection with the transactions contemplated hereby, the Company and Trivest
have agreed to enter into that certain Management Agreement, of even date
herewith (the "NEW MANAGEMENT AGREEMENT"), pursuant to which the Company shall
continue to engage the services of Trivest on the terms and subject to the
conditions contained therein.
C. The Company and Powell were parties to a Second Amended and Restated
Employment Agreement, dated as of January 1, 1990, as amended, pursuant to which
Powell served as the Chairman of the Board of the Company (the "POWELL
EMPLOYMENT AGREEMENT").
D. The Company and George were parties to an Employment Agreement,
dated as of January 1, 1990, as amended, pursuant to which George served as the
Chairman of the Executive Committee of the Board of Directors of the Company
(the "GEORGE EMPLOYMENT AGREEMENT").
E. The Powell Employment Agreement and the George Agreement terminated
on December 31, 1997.
F. The Company is a party to that certain Office Lease (commencement
date as of September 1, 1993), between the Company and SPP Real Estate (Grand
Bay), Inc. (the "LANDLORD") (as successor to Colony GBP Partners, L.P. and Grand
Bay Plaza Joint Venture), as amended (the "MIAMI LEASE"), pursuant to which the
Company is the lessee of office space presently occupied by Trivest II and its
affiliates (the "TRIVEST MIAMI OFFICE").
G. The Company is a party to that certain Sublease Agreement, dated as
of August 17, 1995, between the Company and Concept One International, Inc. (the
"SUBLEASE"), pursuant to which the Company has subleased a portion of the
Trivest Miami Office to Concept One International, Inc.
H. The Company has certain liabilities on its books related to the
Miami Lease, which liabilities aggregate, as of December 31, 1997, the sum of
$170,239 (the "BALANCE SHEET LEASE LIABILITIES").
-1-
<PAGE>
In consideration of the premises and the respective mutual agreements,
covenants, representations and warranties contained in this Agreement, the
parties agree as follows:
AGREEMENT:
1. ASSIGNMENT AND ASSUMPTION OF MIAMI LEASE. Effective as of January 1,
1998 (but subject in all respects to the consent of the Landlord), the Company
hereby assigns to Trivest II and Trivest II hereby assumes and agrees to perform
all of the terms, conditions, covenants and provisions contained in the Miami
Lease to be performed by the Company. Such assignment shall include, without
limitation, all of the Company's right, title and interest in and to all claims,
deposits, prepayments, refunds and other prepaid items relating to the Miami
Lease. Trivest II shall use reasonable commercial efforts to cause the Landlord
to enter into a consent to such assignment. If, in connection with any such
consent, the Landlord shall not consent to the unconditional discharge and
release of the Company from all of its obligations under the Miami Lease,
Trivest II hereby agrees to indemnify the Company from and against any
liability, loss, cost, actual or punitive damage, deficiency, demand, claim,
suit, action or cause of action, fine, penalty, cost or expense of any kind
whatsoever (including reasonable attorney's fees and costs) (collectively,
"Losses" and individually, a "Loss") the Company shall suffer as a result of any
breach of the terms or provisions of the Miami Lease by Trivest II arising after
the effective date of such consent to assignment (the "ASSIGNMENT EFFECTIVE
DATE").
2. ASSIGNMENT AND ASSUMPTION OF SUBLEASE. Effective as of January 1,
1998 (but subject in all respects to the consent of the Landlord to the
assignment of the Sublease as contemplated by Section 1 above), the Company
hereby assigns to Trivest II and Trivest II hereby assumes and agrees to perform
all of the terms, conditions, covenants and provisions contained in the Sublease
to be performed by the Company. Such assignment shall include, without
limitation, all of the Company's right, title and interest in and to all claims,
deposits, prepayments, refunds and other prepaid items relating to the Sublease.
If, in connection with any consent of the Landlord referred to in the
penultimate sentence of Section 1 above, the Landlord shall not consent to the
unconditional discharge and release of the Company from all of its obligations
under the Miami Lease, Trivest II hereby agrees to indemnify the Company from
and against any Losses the Company shall suffer as a result of any breach of the
terms or provisions of the Sublease by Trivest II arising after the Assignment
Effective Date.
3. TRANSFER OF FIXED ASSETS LOCATED AT TRIVEST MIAMI OFFICE; ASSUMPTION
OF BALANCE SHEET LEASE LIABILITIES. In consideration of the undertakings of
Trivest II set forth in Sections 1 and 2 above, the assumption by Trivest of the
Balance Sheet Lease Liabilities and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Company hereby
sells, conveys, assigns, transfers, sets over and delivers to Trivest II,
effective as of January 1, 1998, all of its right, title and interest in and to
all supplies, equipment, furniture, fixtures, leasehold improvements, office
equipment, signs, artwork and all other tangible personal property located at
the Trivest Miami Office. Trivest hereby assumes the Balance Sheet Lease
Liabilities.
-2-
<PAGE>
4. CONTINUATION OF CERTAIN BENEFITS. The Company shall continue to
provide to Powell and to George the use of the leased automobiles provided by
the Company to them as of December 31, 1997, together with the operating
expenses thereof (e.g., insurance, license, repairs, fuel and oil), until the
leases of such automobiles expire.
5. FURTHER ASSURANCES. In the event that at any time after the date
hereof any further action is necessary to carry out the purposes of this
Agreement, each of the parties will take such further action (including the
execution and delivery of such further instruments and documents) as any other
party may reasonably request, all at the sole cost and expense of the requesting
party.
6. NO EXPANSION OF REMEDIES. Trivest II's assumption of any liabilities
and obligations under Sections 1 or 2 above shall in no way expand the rights or
remedies of third parties against Trivest II as compared to the rights and
remedies which such parties would have had against the Company had the
transactions contemplated by this Agreement not been consummated.
7. MISCELLANEOUS.
(a) NO THIRD-PARTY BENEFICIARIES. This Agreement shall not
confer any rights or remedies upon any person other than the parties and their
respective successors and assigns.
(b) ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement among the parties and supersedes any prior understandings, agreements,
or representations by or among the parties, written or oral, to the extent they
related in any way to the subject matter hereof.
(c) SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the parties named herein and their respective
successors and assigns.
(d) COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.
(e) HEADINGS. The section headings contained in this Agreement
are inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
(f) NOTICES. All notices, requests, demands, claims and other
communications hereunder will be in writing. Any notice, request, demand, claim
or other communication hereunder shall be deemed duly given if (and then two
business days after) it is sent by registered or certified mail, return receipt
requested, postage prepaid, and addressed to the intended recipient as set forth
below:
-3-
<PAGE>
If to the Company:
Atlantis Plastics, Inc.
1870 The Exchange
Suite 200
Atlanta, Georgia 30339
Attention: President
If to Trivest II, Powell or George:
Trivest, Inc.
2665 South Bayshore Drive
Suite 800
Miami, Florida 33133
Attention: Chief Executive Officer
Any party hereto may send any notice, request, demand, claim or other
communication hereunder to the intended recipient at the address set forth above
using any other means (including personal delivery, expedited courier, messenger
service, telecopy, telex, ordinary mail or electronic mail), but no such notice,
request, demand, claim or other communication shall be deemed to have been duly
given unless and until it actually is received by the intended recipient. Any
party hereto may change the address to which notices, requests, demands, claims
and other communications hereunder are to be delivered by giving the other party
notice in the manner herein set forth.
(g) GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the domestic laws of the State of Florida without
giving effect to any choice or conflict of law provision or rule (whether of the
State of Florida or any other jurisdiction) that would cause the application of
the laws of any jurisdiction other than the State of Florida.
(h) AMENDMENTS AND WAIVERS. No amendment of any provision of
this Agreement shall be valid unless the same shall be in writing and signed by
each of the parties hereto. No waiver by any party of any default hereunder,
whether intentional or not, shall be deemed to extend to any prior or subsequent
default hereunder or affect in any way any rights arising by virtue of any prior
or subsequent such occurrence.
(i) SEVERABILITY. Any term or provision of this Agreement that
is invalid or unenforceable in any situation in any jurisdiction shall not
affect the validity or enforceability of the remaining terms and provisions
hereof or the validity or enforceability of the offending term or provision in
any other situation or in any other jurisdiction.
-4-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be duly exercised by their authorized representatives as of the date first above
written.
ATLANTIS PLASTICS, INC.
By: ____________________________
Anthony F. Bova
President and Chief Executive Officer
TRIVEST II, INC.
By: ____________________________
Earl W. Powell
President and Chief Executive Officer
__________________________________
EARL W. POWELL
__________________________________
PHILLIP T. GEORGE, M.D.
-5-
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<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
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<CASH> 11,153
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<ALLOWANCES> 933
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<CURRENT-ASSETS> 62,104
<PP&E> 119,321
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<TOTAL-ASSETS> 172,553
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0
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<COMMON> 757
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<TOTAL-LIABILITY-AND-EQUITY> 172,553
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<INCOME-TAX> 881
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