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
July 18, 1996
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(Date of earliest event reported)
Overhead Door Corporation
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(Exact name of registrant as specified in its charter)
Indiana
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(State or other jurisdiction of incorporation)
0-23752 35-0564120
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(Commission File Number) (IRS Employer Identification No.)
6750 LBJ Freeway, Dallas, Texas 75240
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(Address of principal executive offices) (Zip Code)
(214) 233-6611
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(Registrant's telephone number, including area code)
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Item 5. Other Events
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On July 18, 1996, Overhead Door Incorporated, a privately
held Indiana corporation ("ODI") and the parent of Overhead Door
Corporation ("ODC"), closed its previously announced sale of all of
ODI's stock to Sanwa Shutter Corporation of Japan ("Sanwa"). The total
consideration paid or assumed was approximately $710 million, including
$470 million in cash to acquire ODI's common stock, options, and
warrants and to redeem its preferred stock. Sanwa also caused ODC to
refinance its outstanding bank debt of approximately $155 million
including accrued interest. ODC's $85 million of 12.25% Unsecured
Senior Notes due February 1, 2000, remained outstanding on the
acquisition date. Noteholders have the right to put their notes to ODC
at a price of 101% during a certain period following a change in
control.
Item 7. Financial Statements and Exhibits
(c) Exhibits
2. Stock Purchase Agreement
20. Press Release
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SIGNATURE
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.
OVERHEAD DOOR CORPORATION
by /s/ James F. Brum
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Name: James F. Brum
Title: Executive Vice
President-Finance
and Chief
Financial Officer
Date: July 18, 1996
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EXHIBIT INDEX
Exhibit Exhibit Sequentially
Number Numbered
Page
2 Stock Purchase Agreement
dated as of June 29, 1996, among
Overhead Door Incorporated, an
Indiana corporation, Bessemer
Holdings, L.P., a Delaware
limited partnership, Bessemer
Holdings Special Situations, L.P.,
a Delaware limited partnership,
ODI Partners, L.P., a Delaware
limited partnership, Brian J. Bolton
and Sanwa Shutter Corporation, a
corporation organized under the
laws of Japan 5
20 Overhead Door Incorporated
Press Release dated July 18, 1996 67
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EXHIBIT 2
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT dated as of June 29,
1996, among Overhead Door Incorporated, an Indiana
corporation (the "Company"), Bessemer Holdings, L.P., a
Delaware limited partnership ("Bessemer"), the other
stockholders of the Company whose names appear on the
signature pages of this Agreement (Bessemer and such
other stockholders referred to herein collectively as
"Sellers" and individually as a "Seller"), and SANWA
SHUTTER CORPORATION, a corporation organized under the
laws of Japan ("Buyer").
Buyer desires to purchase from Sellers, and Sellers desire
to sell to Buyer, all the issued and outstanding shares of Common
Stock, no par value (the "Shares"), of the Company on the terms and
conditions set forth herein.
Accordingly, the Company, Sellers and Buyer hereby agree as
follows:
1. Purchase and Sale of the Shares; Certain Definitions. (a)
Purchase and Sale of the Shares. On the terms and subject to the
conditions of this Agreement, Sellers shall sell, transfer and deliver
or cause to be sold, transferred and delivered to Buyer, and Buyer
shall purchase from Sellers, the Shares owned by Sellers for an
aggregate purchase price (the "Purchase Price") equal to
(i) $650,000,000 (the "Total Enterprise Value"), less
(ii) the sum of
(A) Net Long Term Debt (as defined in Section
1(b));
(B) the aggregate amount payable to all holders
of the issued and outstanding shares of the
Company's Series A Cumulative Redeemable
Preferred Stock (the "Preferred Shares") in
redemption of all such
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Preferred Shares immediately after the
Closing (as defined in Section 2(a))
as provided in Section 6(c); and
(C) the aggregate Spread (as defined in Section
6(d)) payable to all holders of Options (as
defined in Section 6(d)) in connection with
the cancellation of all such Options
immediately following the Closing as provided
in Section 6(d); plus ----
(iii) (A) the product of (1) the Per Share Purchase
Price (as defined below) less the Weighted Average Exercise
Price Per Share (as defined in Section 1(b)) for all Options
listed on Appendix 1 that are outstanding but unexercised on
the Closing Date (as defined in Section 2(a)) and (2) the
number of shares subject to the Options listed on Appendix 1
that are outstanding but unexercised on the Closing Date
multiplied by (B) 40% (the Company's estimate of its
combined marginal tax rate for all Federal, state and local
Taxes (as defined in Section 4(g))).
The purchase price per share (the "Per Share Purchase Price")
shall be equal to the Purchase Price divided by the number of Shares
outstanding as of the Closing Date. For all purposes of this
Agreement, in the case of any Option that is outstanding on the
Closing Date under the Option Agreements listed in Appendix 2 (the
"Scheduled Option Agreements"), the number of shares subject to such
Option shall be the number of Option Shares (as such term is defined
in the Scheduled Option Agreements) with respect to such Option and
the exercise price for the shares subject to such Option shall be $0
per share.
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(b) Certain Definitions.
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(i) "Credit Facility" shall mean the Credit Agreement dated
as of August 15, 1994, among Overhead Door Incorporated, Overhead
Door Corporation, Various Lending Institutions, NBD Bank, N.A.,
Fleet Bank Massachusetts, N.A., and The Long-Term Credit Bank of
Japan, Ltd., as Co-agents, and Chemical Bank, as Agent, as
amended as of May 31, 1995, and February 15, 1996.
(ii) "IRBs and Mortgage Notes" shall mean each of the
agreements listed in Appendix 3.
(iii) "Long Term Debt" shall mean an amount equal to the
outstanding principal and accrued but unpaid interest as of the
Closing Date (including any current portion thereof) with respect
to (A) the Company's 12.25% Senior Notes Due 2000 (the "12.25%
Notes"), (B) the Term Loan Facility (as defined below) and (C)
the IRBs and Mortgage Notes.
(iv) "Net Long Term Debt" shall mean Long Term Debt as of
the close of business on the Closing Date less the amount of
cash, cash equivalents and marketable securities held by the
Company and its Subsidiaries as of the close of business on the
fourth business day preceding the Closing Date, all calculated in
the same way, using the same methods as the line items in the
December 31, 1995 Balance Sheet (as defined in Section 4(f)).
(v) "Revolving Credit Facility" shall mean the Revolving
Facility as defined in Section 10 of the Credit Facility.
(vi) "Term Loan Facility" shall mean the Term Facility as
defined in Section 10 of the Credit Facility.
(vii) "Weighted Average Exercise Price Per Share" shall mean
the aggregate exercise price payable in respect of each share of
Common Stock which is subject to an Option listed on Appendix 1
that is outstanding but unexercised on the Closing Date divided
by the aggregate number of shares subject to such Options on the
Closing Date.
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2. Closing; Sellers' Representative. (a) Closing. The
closing (the "Closing") of the purchase and sale of the Shares shall
be held at the offices of Cravath, Swaine & Moore, Worldwide Plaza,
825 Eighth Avenue, New York, New York, at 10:00 a.m. on the later of
July 18, 1996 and the fifth business day following the satisfaction or
waiver of all conditions to the obligations of the parties set forth
in Section 3, or at such other place or at such other time or on such
other date as Bessemer, on behalf of the Sellers, and the Buyer may
mutually agree. The date on which the Closing shall occur is referred
to herein as the "Closing Date". At the Closing, (i) Buyer shall
deliver or cause to be delivered to Bessemer, on behalf of the holders
of outstanding Shares on the Closing Date, by wire transfer to the
bank account specified in writing by Bessemer, on behalf of such
holders, at least two business days prior to the Closing Date,
immediately available funds in an amount equal to the product of the
Per Share Purchase Price and the number of Shares (duly endorsed in
blank or accompanied by stock powers duly endorsed in blank in proper
form for transfer) delivered to Buyer on the Closing Date and (ii) the
Sellers shall deliver or cause to be delivered to Buyer certificates
representing the Shares to be sold by Sellers hereunder, duly endorsed
in blank or accompanied by stock powers duly endorsed in blank in
proper form for transfer, with appropriate transfer stamps, if any,
affixed. The calculations of the Spread, the Purchase Price and the
Per Share Purchase Price shall be made by Bessemer and set forth in a
reasonably detailed written schedule delivered to Buyer on the third
business day prior to the Closing Date.
(b) Seller's Representative. Each Seller (other than
Bessemer) hereby appoints Bessemer as the representative of all
Sellers to act as the agent and on behalf of the Sellers for the
purposes of (A) determining the Spread, the Purchase Price and the Per
Share Purchase Price and receiving delivery from Buyer at the Closing
of the product of the Per Share Purchase Price and the number of
Shares to be sold hereunder, all as provided in Section 2(a), (B)
determining whether the conditions to Closing as specified in Section
3(b) have been satisfied and supervising the Closing, including
waiving any conditions to Closing specified in Section 3(b), which
Bessemer, in its sole discretion, deems appropriate to facilitate the
Closing, (C) taking any action that may be necessary or desirable in
connection with the termination of this Agreement in accordance with
Section 13, (D) taking any and all actions that may be necessary or
desirable in connection
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with the amendment of this Agreement in accordance with Section 16,
(E) accepting notices on behalf of the Sellers in accordance with
Section 17, (F) taking any and all actions that may be necessary or
desirable in connection with the payment of the costs and expenses
incurred with respect to the Company or the Sellers in accordance with
Section 15, (G) delivering or causing to be delivered to Buyer at the
Closing certificates representing the Shares to be sold hereunder, (H)
executing and delivering, in Bessemer's capacity as the representative
of the Sellers, any and all notices, documents or certificates to be
executed by Bessemer, on behalf of the Sellers, in connection with
this Agreement and the transactions contemplated hereby; and (I)
taking any and all other actions and doing any and all other things
provided in or contemplated by this Agreement to be performed by
Bessemer on behalf of the Sellers. As the representative of the
Sellers, Bessemer shall act as the agent for all such persons, shall
have authority to bind each such person in accordance with this
Agreement, and Buyer may rely on such appointment and authority until
the receipt of notice of the appointment of a successor upon 30 days'
prior written notice to Buyer.
3. Conditions to Closing. (a) Buyer's Obligation. The
obligation of Buyer to purchase and pay for the Shares is subject to
the satisfaction (or waiver by Buyer) as of the Closing of the
following conditions:
(i) The representations and warranties of the Company made
in Section 4(d)(i) and the representations and warranties of the
Sellers made in Section 5(c)(i) are true and correct as of the
date hereof and as of the time of the Closing as though made as
of such time, except to the extent such representations and
warranties expressly relate to an earlier date (in which case
such representations and warranties shall be true and correct on
and as of such earlier date). With respect to the other
representations and warranties of the Company and of the Sellers
made in this Agreement, the representations and warranties
qualified as to materiality shall be true and correct, and those
not so qualified shall be true and correct in all material
respects, as of the date hereof and as of the time of the Closing
as though made as of such time, except to the extent such
representations and warranties expressly relate to an earlier
date (in which case such representations and warranties qualified
as to
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materiality shall be true and correct, and those not so
qualified shall be true and correct in all material respects, on
and as of such earlier date). The Company and Sellers shall have
performed or complied in all material respects with all
obligations and covenants required by this Agreement to be
performed or complied with by them at or prior to the Closing.
The Company and each Seller shall have delivered to Buyer
certificates dated the Closing Date and signed by an authorized
officer of the Company or by such Seller, as the case may be,
confirming the foregoing.
(ii) No statute, rule, regulation, executive order, decree,
temporary restraining order, preliminary or permanent injunction
or other order enacted, entered, promulgated, enforced or issued
by any Federal, state, local or foreign government or any court
of competent jurisdiction, administrative agency or commission or
other governmental authority or instrumentality, domestic or
foreign (a "Governmental Entity"), or other legal restraint or
prohibition preventing the purchase and sale of the Shares shall
be in effect. No claim, action, suit, arbitration, inquiry,
proceeding or investigation by any Governmental Entity (each an
"Action") shall be pending which seeks to delay or prevent the
consummation of the transactions contemplated hereby or to
materially and adversely alter the transactions contemplated
hereby as a direct result of the purchase and sale of the Shares
pursuant to this Agreement.
(iii) The waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976 (the "HSR Act"), if applicable
to the purchase and sale of the Shares, shall have expired or
been terminated.
(iv) The Company shall have called for redemption all the
issued and outstanding Preferred Shares, as provided in Section
6(c).
(v) The Company shall have canceled, effective as of the
Closing and subject to making the cash payments described in
Section 6(d), all outstanding Options that have not been
exercised as of the Closing Date, as provided in Section 6(d),
other than such Options which in the aggregate account for not
more than 0.8% of the outstanding Common Stock of the Company on
the Closing Date.
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(vi) Except as set forth in Schedule 4(o) of the Disclosure
Schedule, since December 31, 1995, no event has occurred that
would have a material adverse effect on the business, assets,
financial condition or results of operations of the Company and
the Subsidiaries, taken as a whole, other than any events
relating to United States or foreign economies in general or the
Company's and the Subsidiaries' industries in general and not
specifically relating to the Company or a Subsidiary and other
than any events relating to any disruptions to the Company's and
the Subsidiaries' business as a result of the marketing of the
Company by Sellers to potential buyers and the execution of this
Agreement and the consummation of the transactions contemplated
hereby.
(vii) The Company shall not have terminated without cause
the employment of any of the following employees: Brian J.
Bolton; Fred S. Grunewald; Howard R. Simmons; James F. Brum; C.
Michael Budd; William A. Schochet; and John Venema, it being
understood and agreed that any voluntary termination of his
employment by any such employee shall not constitute termination
without cause.
(viii) Buyer shall have received certificates representing
all the outstanding Shares on the Closing Date duly endorsed in
blank or accompanied by stock powers duly endorsed in blank in
proper form for transfer, with appropriate transfer stamps, if
any, affixed.
(b) Sellers' Obligation. The obligation of Sellers to sell
and deliver the Shares to Buyer is subject to the satisfaction (or
waiver by Sellers) as of the Closing of the following conditions:
(i) The representations and warranties of Buyer made in this
Agreement qualified as to materiality shall be true and correct,
and those not so qualified shall be true and correct in all
material respects, as of the date hereof and as of the time of
the Closing as though made as of such time, except to the extent
such representations and warranties expressly relate to an
earlier date (in which case such representations and warranties
qualified as to materiality shall be true and correct, and those
not so qualified shall be true and correct in all material
respects, on and as of such
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earlier date). Buyer shall have performed or complied in all
material respects with all obligations and covenants required by
this Agreement to be performed or complied with by Buyer at or
prior to the Closing. Buyer shall have delivered to Sellers a
certificate dated the Closing Date and signed by an authorized
officer of Buyer confirming the foregoing.
(ii) No statute, rule, regulation, executive order, decree,
temporary restraining order, preliminary or permanent injunction
or other order enacted, entered, promulgated, enforced or issued
by any Governmental Entity or other legal restraint or
prohibition preventing the purchase and sale of the Shares shall
be in effect. No Action shall be pending which seeks to delay or
prevent the consummation of the transactions contemplated hereby
or to materially and adversely alter the transactions
contemplated hereby as a direct result of the purchase and sale
of the Shares pursuant to this Agreement.
(iii) The waiting period under the HSR Act, if applicable to
the purchase and sale of the Shares, shall have expired or been
terminated.
(iv) Buyer shall have, as of the Closing, provided to the
Company the funds described in Section 8(d).
(v) Buyer shall have, as of the Closing, provided the
Company the funds described in Section 8(e).
(vi) Buyer shall have delivered or caused to be delivered to
Bessemer, on behalf of the holders of outstanding Shares on the
Closing Date, by wire transfer to the bank account specified in
writing by Bessemer, on behalf of such holders, at least two
business days prior to the Closing Date, immediately available
funds in an amount equal to the product of the Per Share Purchase
Price and the number of Shares (duly endorsed in blank or
accompanied by stock powers duly endorsed in blank in proper form
for transfer) delivered to Buyer on the Closing Date.
(vii) The Buyer shall have as of the Closing either (x)
provided Overhead Door Corporation with funds necessary for
Overhead Door Corporation to repay, and caused Overhead Door
Corporation to repay, in full the Term Loan Facility and the
Revolving Credit Facility
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upon the consummation of the transactions contemplated
by this Agreement or (y) obtained a waiver of any
breaches of the provisions of the Credit Facility that
occur or with the passage of time or notice or both
will occur as a result of the consummation of the
transactions contemplated by this Agreement and a
waiver of the applicability of any change of control
provisions of the Credit Facility.
4. Representations and Warranties of the Company. The
Company hereby represents and warrants to Buyer as follows:
(a) Authority. The Company has all requisite power and
authority to enter into this Agreement, to perform its obligations
hereunder and to consummate the transactions contemplated hereby. All
acts and other proceedings required to be taken by the Company to
authorize the execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby have been
duly and properly taken. This Agreement has been duly authorized,
executed and delivered by the Company and, assuming due authorization,
execution and delivery by the other parties hereto, constitutes a
legal, valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms.
(b) No Conflicts; Consents. Except as set forth in Schedule
4(b) of the Disclosure Schedule dated the date hereof, relating to
this Agreement (the "Disclosure Schedule"), the execution and delivery
of this Agreement by the Company does not, and the consummation of the
transactions contemplated hereby and compliance with the terms hereof
by the Company will not, conflict with, or result in any violation of
or default (with or without notice or lapse of time, or both) under,
or give rise to a right of termination, cancellation, amendment or
acceleration of any obligation or to loss of any benefit under, or
result in the creation of any lien, claim, encumbrance, security
interest, option, charge or restriction of any kind upon any of the
properties or assets of the Company or any Subsidiary under, any
provision of (i) the Articles of Incorporation or By-laws of the
Company or the comparable governing instruments of any Subsidiary,
(ii) any note, bond, mortgage, indenture, guaranty, deed of trust,
license, lease, contract, commitment, agreement or arrangement to
which the Company or any Subsidiary is a party or by which any of
their respective properties or
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assets are bound or encumbered or (iii) any judgment, order or decree,
or statute, law, ordinance, rule or regulation applicable to the
Company or any Subsidiary or their respective properties or assets,
other than, in the case of clauses (ii) and (iii) above, any such
items that, individually or in the aggregate, would not have a
material adverse effect on the business, assets, financial condition
or results of operations of the Company and the Subsidiaries, taken as
a whole, or on the ability of the Company to consummate the
transactions contemplated hereby (a "Material Adverse Effect"). No
material consent, approval, license, permit, order or authorization
of, or registration, declaration or filing with, any Governmental
Entity is required to be obtained or made by or with respect to the
Company or any Subsidiary in connection with the execution, delivery
and performance of this Agreement or the consummation of the
transactions contemplated hereby other than (i) compliance with and
filings under the HSR Act, if applicable, (ii) compliance with and
filings and notifications under applicable environmental laws and
(iii) those that may be required solely by reason of Buyer's (as
opposed to any other third party's) participation in the transactions
contemplated hereby. The term "Subsidiary" means each person of which
a majority of the voting power of the equity securities or equity
interest is owned, directly or indirectly, by the Company.
(c) Organization and Standing; Books and Records. Except as
set forth in Schedule 4(c) of the Disclosure Schedule, each of the
Company and the Subsidiaries is a corporation duly organized, validly
existing and in good standing under the laws of its jurisdiction of
incorporation. Each of the Company and the Subsidiaries has full
corporate power and authority and possesses all governmental
franchises, licenses, permits, authorizations and approvals necessary
to enable it to own, lease or otherwise hold its properties and assets
and to carry on its business as presently conducted, other than such
franchises, licenses, permits, authorizations and approvals the lack
of which, individually or in the aggregate, would not have a Material
Adverse Effect. Each of the Company and the Subsidiaries is duly
qualified and in good standing to do business as a foreign corporation
in each jurisdiction in which the conduct or nature of its business or
the ownership, leasing or holding of its properties makes such
qualification necessary, except such jurisdictions where the failure
to be so qualified or in good standing, individually
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or in the aggregate, would not have a Material Adverse Effect.
The Company has, prior to the execution of this Agreement,
made available to Buyer true and complete copies of (i) the Articles
of Incorporation and By-laws, each as amended to date, of the Company
and (ii) the comparable governing instruments, each as amended to
date, of each of Overhead Door Corporation, ABC Door Corporation, BRF
Door Corporation, Central Nebraska, Inc., CNC Door Company, Dallas
Properties Group, Inc., GMI Holdings, Inc., More Door Company, OHD
Corporation, TFL Door Corporation and XYZ Door Company (each, a "U.S.
Operating Subsidiary"). The minute books of the Company and each U.S.
Operating Subsidiary are true and complete in all material respects.
The minute books of the Company, Overhead Door Corporation and GMI
Holdings, Inc. have been made available for inspection by Buyer prior
to the date hereof.
(d) Capital Stock of the Company and the Subsidiaries. (i)
The authorized capital stock of the Company consists of 4,830,974
shares of Series A Cumulative Redeemable Preferred Stock, of which
3,184,091 shares are duly authorized, validly issued and outstanding,
fully paid and nonassessable and 169,043 shares have accrued as unpaid
dividends thereon as of the close of business on June 27, 1996, and
100,000,000 shares of common stock, no par value, comprised of
98,400,000 shares of Class A Common Stock (the "Class A Common
Shares") and 1,600,000 shares of Class B Common Stock (the "Class B
Common Shares"), of which 15,935,498 Class A Common Shares and 777,720
Class B Common Shares are duly authorized, validly issued and
outstanding, fully paid and nonassessable and 5,635,399 Class A Common
Shares and, except as set forth in Schedule 4(d) of the Disclosure
Schedule, 883,774 Class B Common Shares are issuable pursuant to the
Options as of the close of business on June 27, 1996. Except as set
forth above, there are no shares of capital stock or other equity
securities of the Company outstanding as of the close of business on
June 27, 1996. Schedule 4(d) sets forth a list of the record holders
of the shares of capital stock of the Company as of the close of
business on June 27, 1996. Except for the Options and except as
otherwise set forth in Schedule 4(d) of the Disclosure Schedule, there
are not any outstanding warrants, options, rights, "phantom" stock
rights, agreements, convertible or exchangeable securities or other
commitments (other than this Agreement) pursuant to which any of the
Company or any Subsidiary is or may become obligated to
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issue, sell, purchase, return or redeem any shares of capital stock or
other securities of the Company or any Subsidiary. The Company owns,
directly or indirectly, all the outstanding capital stock of each
Subsidiary.
(ii) Schedule 4(d) of the Disclosure Schedule sets forth
each Subsidiary of the Company and, for each such Subsidiary: the
jurisdiction of its incorporation, the amount of its authorized
capital stock, the amount of its outstanding capital stock and the
record owners of its outstanding capital stock. All the outstanding
shares of capital stock of each Subsidiary have been duly authorized
and validly issued and are fully paid and nonassessable. Except as set
forth in Schedule 4(d) of the Disclosure Schedule, there are no shares
of capital stock or other equity securities of any Subsidiary
outstanding. Except for the Options and except as set forth in
Schedule 4(d) of the Disclosure Schedule, neither the Shares nor any
shares of capital stock of any Subsidiary have been issued in
violation of, and none of the Shares or such shares of capital stock
are subject to, any purchase option, call, right of first refusal,
preemptive, subscription or similar rights under any provision of
applicable law, the Articles of Incorporation or By-laws of the
Company or the comparable governing instruments of any Subsidiary, any
contract, agreement or instrument to which the Company or any
Subsidiary is subject, bound or a party or otherwise. Except as set
forth in Schedule 4(d) of the Disclosure Schedule, there are not any
equity securities of the Company reserved for issuance for any
purpose. There are no outstanding bonds, debentures, notes or other
indebtedness having the right to vote on any matters on which
stockholders of the Company or any Subsidiary may vote.
(e) Equity Interests. Except as set forth in Schedule 4(e)
of the Disclosure Schedule and except for the Subsidiaries, the
Company does not directly or indirectly own any capital stock of or
other equity interests in any corporation, partnership or other person
and neither the Company nor any of the Subsidiaries is a member of or
participant in any partnership, joint venture or similar person.
(f) Financial Statements. Schedule 4(f) of the Disclosure
Schedule includes (i) the audited consolidated statements of financial
condition of the Company and Subsidiaries as of December 31, 1994 and
December 31, 1995 (the audited consolidated statement of financial
condition
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of the Company and Subsidiaries as of December 31, 1995 being referred
to herein as the "December 31, 1995 Balance Sheet"), and the audited
consolidated statements of operations, shareholders' equity and cash
flows of the Company and Subsidiaries for the three years ended
December 31, 1995 (such financial statements described in this clause
(i), collectively, together with the notes to such financial
statements, the "December 31, 1995 Financial Statements"), and (ii)
the unaudited condensed consolidated statement of financial condition
of the Company and Subsidiaries as of March 31, 1996 (the "March 31,
1996 Balance Sheet"), and the unaudited condensed consolidated
statements of operations and cash flows of the Company and
Subsidiaries for the quarter ended March 31, 1996 (such financial
statements described in this clause (ii), collectively, together with
the notes to such financial statements, the "March 31, 1996 Financial
Statements"; the December 31, 1995 Financial Statements together with
the March 31, 1996 Financial Statements, collectively, the "Financial
Statements"). The Financial Statements (i) were prepared in all
material respects in accordance with the books of account and other
financial records of the Company and Subsidiaries and (ii) have been
prepared in conformity with generally accepted accounting principles
consistently applied (except in each case as described in the notes
thereto and except that in preparing the March 31, 1996 Financial
Statements certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant
to the Securities and Exchange Commission's rules and regulations).
The December 31, 1995 Financial Statements present fairly, in all
material respects, the consolidated financial position and results of
operations of the Company and Subsidiaries as of the respective dates
thereof and for the respective periods indicated. The March 31, 1996
Financial Statements present fairly, in all material respects, the
consolidated financial position and results of operations of the
Company and Subsidiaries as of the respective dates thereof and for
the respective periods indicated (except as described in the notes
thereto and except that in preparing the March 31, 1996 Financial
Statements certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant
to the Securities and Exchange Commission's rules and regulations).
The March 31, 1996 Financial Statements include all adjustments, which
are of a normal recurring
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nature, necessary to present the information fairly as aforesaid. The
unaudited condensed consolidated statement of financial condition of
the Company and Subsidiaries dated as of April 30, 1996 is attached
hereto in Schedule 4(f) of the Disclosure Schedule (the "April 30,
1996 Balance Sheet"). The April 30, 1996 Balance Sheet (i) was
prepared in all material respects in accordance with the books of
account and other financial records of the Company and Subsidiaries
and in a manner consistent with the Company's past practices for
non-quarter ended financial reporting and (ii) has been prepared in
conformity with generally accepted accounting principles consistently
applied (except that (i) the other financial statements and footnote
disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been
omitted and (ii) certain information normally included in financial
statements prepared in accordance with generally accepted accounting
principles has been condensed on a basis consistent with the
presentation in the March 31, 1996 Balance Sheet).
(g) Taxes. (i) For purposes of this Agreement, (A) "Income
Tax" or "Income Taxes" shall mean any and all taxes of any kind
(together with any and all interest, penalties, additions to tax and
additional amounts imposed with respect thereto) imposed by any
government taxing authority, including, without limitation, taxes or
other charges on or with respect to income; "Non-Income Tax" or
"Non-Income Taxes" shall mean taxes on or with respect to franchises,
windfall or other profits, gross receipts, property, sales, use,
capital stock, payroll, employment, social security, workers'
compensation, unemployment compensation, or net worth, and taxes or
other charges in the nature of excise, withholding, ad valorem or
value added (together with any and all interest, penalties, additions
to tax and additional amounts imposed with respect thereto); and "Tax"
or "Taxes" shall mean Income Taxes and Non-Income Taxes, collectively,
and (B) "Code" shall mean the Internal Revenue Code of 1986, as
amended.
(ii) Except as set forth in Schedule 4(g) of the Disclosure
Schedule, (A) the Company and each of the Subsidiaries has filed or
caused to be filed in a timely manner (within any applicable extension
periods) all material Income and Non-Income Tax returns, reports and
forms required to be filed by the Code or by applicable state, local
or foreign tax laws, (B) all such material Income and Non-Income Tax
returns, reports and forms are
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true, correct and complete in all material respects, (C) all Taxes
shown to be due on all material Income and Non-Income Tax returns,
reports and forms have been timely paid in full or will be timely paid
in full by the due date thereof, (D) no material tax liens have been
filed and no material claims are being asserted in writing with
respect to any Taxes, (E) no material adjustment relating to any Tax
returns for taxable years for which the statute of limitations has not
expired has been proposed formally to the Sellers or any Subsidiary by
any Tax authority, (F) to the knowledge of the Company, there are no
pending actions or proceedings for the assessment or collection of
material Taxes against the Company or a Subsidiary, (G) the Company
and the Subsidiaries have established adequate reserves in accordance
with generally accepted accounting principles for all Taxes due with
respect to periods prior to the date hereof but not yet payable, (H)
all material Taxes required to be withheld, collected or deposited by
the Company or a Subsidiary have been timely withheld, collected or
deposited, and to the extent required, have been paid to the relevant
Tax authority, and (I) none of the Company and its Subsidiaries is a
party to any Tax allocation or sharing agreement other than among
members of the Company's "affiliated group", as that term is defined
in the Code and the Treasury regulations thereunder or otherwise has
any material liability for the Taxes of any past or present affiliate.
(iii) Except as set forth in Schedule 4(g) of the Disclosure
Schedule, (A) neither the Company nor any of the Subsidiaries has made
any consent under Section 341 of the Code, (B) no property of the
Company or any of the Subsidiaries is "tax exempt use property" within
the meaning of Section 168(h) of the Code and (C) neither the Company
nor any of the Subsidiaries is a party to any lease made pursuant to
Section 168(f)(8) of the Internal Revenue Code of 1954.
(iv) Except as set forth in Schedule 4(g) of the Disclosure
Schedule, (A) the United States federal Income Tax returns of each of
the Company and its Subsidiaries for taxable years since 1990 have not
been audited or examined by the Internal Revenue Service, and the
statute of limitations has expired for all such Tax periods from 1990
through 1991, (B) the material state Income Tax returns of each of the
Company and its Subsidiaries for the taxable years since 1990 have not
been audited or examined by the applicable state taxing authority and
all statutes of
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limitation for all applicable state taxable periods from 1990 through
1991 have expired for such Income Tax returns, (C) no issue has been
raised in writing by the Internal Revenue Service in any audit of a
post-1989 tax period which, by application of the same or similar
principles, will result in a material deficiency for federal Income
Taxes for any periods subsequent to the Closing Date, and (D) no
closing agreement pursuant to Section 7121 of the Code (or any
predecessor provision) has been entered into by or with respect to the
Company or any or its Subsidiaries for any taxable year since 1990.
(v) Except as set forth in Schedule 4(g) of the Disclosure
Schedule, there are no outstanding agreements or waivers extending the
statutory period of limitation applicable to any material Tax returns
required to be filed with respect to the Company or any of the
Subsidiaries and neither the Company nor any of the Subsidiaries has
requested any extension of time within which to file any material Tax
return, which return has not yet been filed.
(vi) None of the Sellers is a "foreign person" within the
meaning of Section 1445 of the Code.
(h) Assets Other than Real Property Interests. To the
knowledge of the Company, the Company or a Subsidiary owns, leases or
has the legal right to use all material assets used in the conduct of
the business of the Company and the Subsidiaries as presently
conducted, other than in instances where the failure to own, lease or
have legal title to such assets would not, individually or in the
aggregate, have a Material Adverse Effect. The Company or a Subsidiary
has good and valid title to all material assets reflected on the
December 31, 1995 Balance Sheet or thereafter acquired, except those
listed in Schedule 4(h) of the Disclosure Schedule or those sold or
otherwise disposed of since the date of the December 31, 1995 Balance
Sheet in the ordinary course of business consistent with past
practice, in each case free and clear of all mortgages, liens,
security interests or encumbrances of any kind (each, an
"Encumbrance") except (i) such as are set forth in Schedule 4(h) of
the Disclosure Schedule, (ii) mechanics', carriers', workmen's,
repairmen's or other like liens arising or incurred in the ordinary
course of business, liens arising under original purchase price
conditional sales contracts and equipment leases with third parties
entered into in the ordinary course of business and liens for Taxes
which are not due and payable or which may
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thereafter be paid without penalty, (iii) mortgages, liens, security
interests and encumbrances which secure debt that is reflected as a
liability on the December 31, 1995 Balance Sheet or the existence of
which is indicated in the notes thereto and (iv) other imperfections
of title or encumbrances, if any, which do not, individually or in the
aggregate, materially impair the continued use and operation of the
assets to which they relate in the business of the Company and the
Subsidiaries, taken as a whole, as presently conducted (the mortgages,
liens, security interests, encumbrances and imperfections of title
described in clauses (ii), (iii) and (iv) above are hereinafter
referred to collectively as "Permitted Liens"). This Section 4(h) does
not relate to real property or interests in real property, such items
being the subject of Section 4(i) or interests in intellectual
property, such items being the subject of Section 4(j); however, the
defined term "Permitted Liens" shall be applicable to Sections 4(i)
and 4(j).
(i) Real Property. Schedule 4(i) of the Disclosure Schedule
sets forth a complete list of all real property and interests in real
property owned in fee by the Company and the Subsidiaries
(individually, an "Owned Property"). Schedule 4(i) of the Disclosure
Schedule also sets forth a complete list of all real property and
interests in real property leased by the Company and the Subsidiaries
(individually, a "Leased Property"). The Company or a Subsidiary has
(i) good, marketable and insurable fee title to all Owned Property and
(ii) good and valid title to the leasehold estates in all Leased
Property (an Owned Property or Leased Property being sometimes
referred to herein, individually, as a "Company Property" and,
collectively, as "Company Properties"), in each case free and clear of
all mortgages, liens, security interests, encumbrances, leases,
assignments, subleases, easements, covenants, rights-of-way and other
similar restrictions of any nature whatsoever, except (A) such as are
set forth in Schedule 4(i) of the Disclosure Schedule, (B) leases,
subleases and similar agreements set forth in Schedule 4(i) of the
Disclosure Schedule, (C) Permitted Liens, (D) easements, covenants,
rights-of-way and other similar restrictions of record, (E) any
conditions that may be shown by a current, accurate survey or physical
inspection of any Company Property made prior to Closing and (F) (I)
zoning, building and other similar restrictions, (II) mortgages,
liens, security interests, encumbrances, easements, covenants,
rights-of-way and other similar restrictions that have been placed by
any developer, landlord or other third
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party on property over which the Company or a Subsidiary has easement
rights or on any Leased Property and subordination or similar
agreements relating thereto, and (III) unrecorded easements,
covenants, rights-of-way and other similar restrictions, none of which
items set forth in clauses (I), (II) and (III), individually or in the
aggregate, materially impair the continued use and operation of the
property to which they relate in the business of the Company and the
Subsidiaries, taken as a whole, as presently conducted. There are no
pending or, to the knowledge of the Company, threatened condemnation
proceedings with respect to all or any material part of any material
Company Property. To the knowledge of the Company, the Company and the
Subsidiaries are not in violation of any covenants, conditions or
restrictions in any operating agreements, reciprocal easement
agreements or any other agreements affecting the Company Properties
other than any such violations that would not, individually or in the
aggregate, have a Material Adverse Effect.
(j) Intellectual Property. Schedule 4(j) of the Disclosure
Schedule sets forth a true and complete list of all material patents,
service marks, tradenames, logos, trademarks (registered or
unregistered), and applications therefor (collectively, "Intellectual
Property"), owned, used or filed by or licensed to the Company or any
of the Subsidiaries. With respect to registered trademarks, Schedule
4(j) of the Disclosure Schedule sets forth a list of all jurisdictions
in which such trademarks are registered or applied for and all
registration and application numbers. Except as set forth in Schedule
4(j) of the Disclosure Schedule, the Company or one of the
Subsidiaries owns, and the Company and the Subsidiaries have the right
to use, execute, reproduce, display, perform, modify, enhance,
distribute, prepare derivative works of and sublicense, without
payment to any other person, all Intellectual Property listed in
Schedule 4(j) of the Disclosure Schedule and the consummation of the
transactions contemplated hereby will not conflict with, alter or
impair any such rights.
Neither the Company nor any of the Subsidiaries has granted
any material options, licenses or agreements of any kind relating to
Intellectual Property listed in Schedule 4(j) of the Disclosure
Schedule or the marketing or distribution thereof, except nonexclusive
licenses to distributors and end-users in the ordinary course of
business. Neither the Company nor any of the Subsidiaries is bound by
or a party to any material options, licenses or
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agreements of any kind relating to the intellectual property of any
other person, except as set forth in Schedule 4(j) of the Disclosure
Schedule and except for agreements relating to computer software
licensed by or to the Company or any Subsidiary in the ordinary course
of business. Subject to the rights of third parties set forth in
Schedule 4(j) of the Disclosure Schedule and except for Permitted
Liens, all Intellectual Property listed in Schedule 4(j) of the
Disclosure Schedule is free and clear of the claims of others and of
all liens, security interests and encumbrances whatsoever. Except as
set forth in Schedule 4(j) of the Disclosure Schedule, to the
knowledge of the Company, the rights of the Company or any Subsidiary,
as the case may be, in or to such Intellectual Property and the
conduct of the business of the Company and the Subsidiaries as
presently conducted does not violate, conflict with or infringe the
intellectual property of any other person, other than such violations,
conflicts and infringements which would not, individually or in the
aggregate, have a Material Adverse Effect. Except as set forth in
Schedule 4(j) of the Disclosure Schedule, (i) no claims are pending as
of the close of business on June 27, 1996 against the Company or any
Subsidiary by any person with respect to the ownership, validity,
enforceability, effectiveness or use of any Intellectual Property
listed on Schedule 4(j) and (ii) since January 1, 1990, the Company
and the Subsidiaries have not received any written communications
alleging that the Company or any Subsidiary has violated any rights
relating to the intellectual property of any person, other than such
violations that would not, individually or in the aggregate, have a
Material Adverse Effect. To the knowledge of the Company, except as
set forth in Schedule 4(j) of the Disclosure Schedule, no person is
using any patents, copyrights, trademarks, service marks, trade names,
trade secrets or similar property that infringe upon the Intellectual
Property listed on Schedule 4(j) or upon the rights of the Company or
any Subsidiary therein, other than infringements that would not,
individually or in the aggregate, have a Material Adverse Effect.
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(k) Contracts. Except as set forth in Section 4(k) of the
Disclosure Schedule, neither the Company nor any Subsidiary is a party
to or bound by any of the following types of contracts, agreements,
leases, licenses, commitments or instruments (including any oral
contracts and agreements (i) that meet the material thresholds set
forth below or, in any case where there is not a materiality
threshold, that are material to the Company and the Subsidiaries,
taken as a whole, (ii) that are legally binding on the Company or such
Subsidiary and (iii) of which the Company has knowledge) (each, a
"Contract"):
(i) employment agreement or employment contract that has an
aggregate future liability in excess of $500,000 or is not
terminable by the Company or a Subsidiary by notice of not more
than 90 days for a cost of less than $500,000;
(ii) employee collective bargaining agreement or other
contract with any labor union;
(iii) covenant of the Company or a Subsidiary not to compete
(other than pursuant to any radius restriction contained in any
lease, reciprocal easement or development, construction,
operating or similar agreement and other than exclusivity
arrangements with respect to territories and/or products with
distributors, dealers, sales or manufacturer's representatives,
customers or other persons with similar relationships with the
Company or such Subsidiary);
(iv) agreement (other than this Agreement), contract or
other arrangement with (A) any Seller or any affiliate of such
Seller (other than the Company or a Subsidiary) or (B) any
officer, director or employee of the Company, a Subsidiary, any
Seller or any affiliate of such Seller (other than employment
agreements covered by clause (i) above);
(v) lease, sublease or similar agreement with any person
(other than the Company or a Subsidiary) under which the Company
or a Subsidiary is a lessor or sublessor of, or makes available
for use to any person (other than the Company or a Subsidiary),
(A) any Company Property or (B) any portion of any premises
otherwise occupied by the Company or a Subsidiary;
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(vi) lease or similar agreement with any person under which
(A) the Company or a Subsidiary is lessee of, or holds or uses,
any machinery, equipment, vehicle or other tangible personal
property owned by any person or (B) the Company or a Subsidiary
is a lessor or sub- lessor of, or makes available for use by any
person, any tangible personal property owned or leased by the
Company or a Subsidiary, in any such case which has an aggregate
future liability or receivable, as the case may be, in excess of
$500,000 or is not terminable by the Company or a Subsidiary by
notice of not more than 90 days for a cost of less than $500,000;
(vii) (A) contract for the future purchase of materials,
supplies or equipment (other than (i) open purchase orders, (ii)
invoices and (iii) any such agreements for purchases or orders of
less than $1,000,000, in each case in the ordinary course of
business), (B) management, service, consulting or other similar
type of contract or (C) advertising, market research or marketing
consulting agreement or arrangement, in any such case which has
an aggregate future liability to any person (other than the
Company or a Subsidiary) in excess of $500,000 ($100,000 with
respect to contracts described in clause (B) above) or is not
terminable by the Company or a Subsidiary by notice of not more
than 90 days for a cost of less than $500,000;
(viii) agreement, contract or other instrument under which
the Company or a Subsidiary has borrowed any money from, or
issued any note, bond, debenture or other evidence of
indebtedness to, any person (other than the Company or a
Subsidiary) or any other note, bond, debenture or other evidence
of indebtedness issued to any person (other than the Company or a
Subsidiary) in any such case which, individually, is in excess of
$500,000;
(ix) agreement, contract or other instrument under which (A)
any person (including the Company or a Subsidiary) has directly
or indirectly guaranteed indebtedness, liabilities or obligations
of the Company or a Subsidiary or (B) the Company or a Subsidiary
has directly or indirectly guaranteed indebtedness, liabilities
or obligations of any person (in each case other than
endorsements for the purpose of collection
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in the ordinary course of business) in any such case which,
individually, is in excess of $500,000;
(x) agreement, contract or other instrument under which the
Company or a Subsidiary has, directly or indirectly, made any
advance, loan, extension of credit (other than the creation of
accounts receivable created in the ordinary course of business)
or capital contribution to, or other investment in, any person
(other than the Company or a Subsidiary) in any such case which,
individually, is in excess of $500,000;
(xi) mortgage, pledge, security agreement, deed of trust or
other instrument granting a lien or other Encumbrance upon any
Company Property other than Permitted Liens;
(xii) agreement or instrument entered into since January 1,
1989, providing for indemnification of any person (other than the
Company or any Subsidiary) with respect to material liabilities
relating to any current or former business of the Company, a
Subsidiary or any predecessor person; or
(xiii) other agreement, contract, lease, license, commitment
or instrument (other than (i) open purchase orders, (ii)
invoices, (iii) any such agreements for purchases or orders of
less than $1,000,000 or (iv) any such agreements for sales of
finished goods by the Company or any Subsidiary, in each case in
the ordinary course of business) to which the Company or any
Subsidiary is a party or by or to which it or any of its assets
or business is bound or subject to any person (other than the
Company or a Subsidiary) (A) in excess of $500,000, (B) not
terminable by the Company or a Subsidiary by notice of not more
than 90 days for a cost of less than $500,000 or (C) otherwise
material to the Company or any Subsidiary or the conduct of the
business of the Company or any Subsidiary as presently conducted,
the absence of which would have a Material Adverse Effect.
Except as set forth in Schedule 4(k) of the Disclosure Schedule, all
of the Contracts listed in Schedules 4(i), 4(j) and 4(k) and the
distribution agreements with the Overhead Door Corporation Ribbon
distributors listed in Schedule 4(u)(i) of the Disclosure Schedule
("Scheduled Contracts") are valid, binding and in full force and
effect
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and are enforceable by the Company or the relevant Subsidiary in
accordance with their terms (in each case subject to applicable
bankruptcy, reorganization, fraudulent transfer, insolvency,
moratorium or other laws affecting creditor's rights generally from
time to time in effect, and to general principles of equity), other
than such Scheduled Contracts, the invalidity or unenforceability of
which would not, individually or in the aggregate, have a Material
Adverse Effect. Except as set forth in Schedule 4(k) of the Disclosure
Schedule, the Company and the Subsidiaries have performed all material
obligations required to be performed by them to date under the
Scheduled Contracts and they are not (with or without the lapse of
time or the giving of notice, or both) in breach or default in any
material respect thereunder and, to the knowledge of the Company, no
other party to any of the Scheduled Contracts is (with or without the
lapse of time or the giving of notice, or both) in breach or default
in any material respect thereunder, other than such breaches or
defaults which would not, individually or in the aggregate, have a
Material Adverse Effect. The Company has made available to the Buyer
true and complete copies of each Scheduled Contract.
(l) Litigation. Schedule 4(l) of the Disclosure Schedule
sets forth a list as of the close of business on June 27, 1996 of all
pending lawsuits or claims, with respect to which the Company or any
Subsidiary has been contacted in writing by counsel for the plaintiff
or claimant, against the Company or any Subsidiary or any of their
respective properties, assets, operations or businesses and which (i)
relate to or involve uninsured amounts of more than $100,000, (ii)
seek any material injunctive relief or (iii) may give rise to any
legal restraint on or prohibition against the transactions
contemplated by this Agreement. To the knowledge of the Company,
neither the Company nor any Subsidiary is a party or subject to or in
default under any material judgment, order, injunction or decree of
any Governmental Entity or arbitration tribunal applicable to it or
any of its respective properties, assets, operations or business.
Except as set forth in Schedule 4(l) of the Disclosure Schedule, to
the knowledge of the Company, there are no pending or threatened
investigations of the Company or a Subsidiary by any Governmental
Entity, other than such investigations that, if resulting in entry of
any judgment, order, injunction or decree, would not have a Material
Adverse Effect.
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(m) Insurance. Schedule 4(m) of the Disclosure Schedule
lists each insurance policy owned and maintained by the Company or any
Subsidiary which requires aggregate premium payments (other than
retroactive or retrospective premium adjustments or other payments
that may be required under the relevant policy that are not, but may
be, required to be repaid) by the Company or any Subsidiary over the
remaining term of the policy of $100,000 or more, or which is
otherwise material to the Company and its Subsidiaries, taken as a
whole. All such insurance policies are in full force and effect, all
premiums due and payable thereon have been paid (other than
retroactive or retrospective premium adjustments or other payments
that may be required under the relevant policy that are not yet, but
may be, required to be paid), and no notice of cancellation or
termination has been received with respect to any such policy which
has not been replaced on substantially similar terms prior to the date
of such cancellation. To the knowledge of the Company, the Company or
such Subsidiary, as the case may be, is not in default in any material
respect under the terms of any such policy. The Company and the
Subsidiaries maintain policies of fire and casualty, liability and
other forms of insurance in such amounts, with such deductibles and
against such risks and losses as are, in the Company's judgment,
reasonable for the business and assets of the Company and the
Subsidiaries. The Company and the Subsidiaries' reserves for
self-insured losses have been established in accordance with generally
accepted accounting principles.
(n) Benefit Plans. (i) Schedule 4(n) of the Disclosure
Schedule identifies each material employee pension, retirement,
executive retirement, profit sharing, stock bonus, stock option, stock
purchase, bonus, incentive, deferred compensation, hospitalization,
medical, dental, vision, vacation, insurance, sick pay, disability,
severance, or other plan, fund, program, policy, contract or
arrangement providing employee benefits maintained or contributed to
by the Company or any Subsidiary in which any employees or former
employees of the Company or any Subsidiary participates or under which
any of them has accrued and remains entitled to any benefits (all such
plans, funds, programs, policies, contracts and arrangements, other
than any such plan that is a "multiemployer plan" described in Section
4001(a)(3) of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), being referred to as the "Plans"). The Company has
made available to Buyer copies of all written Plans.
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(ii) Neither the Company nor any Subsidiary would be liable
for any material amount pursuant to Section 4062, 4063 or 4064 of
ERISA if any Plan which is subject to Title IV of ERISA (a "Title IV
Plan") were to terminate as of the date hereof. Neither the Company
nor any Subsidiary has been involved in any transaction that is likely
to cause the Company or any such Subsidiary to be subject to liability
with respect to a Title IV Plan or any other plan subject to Title IV
of ERISA to which the Company or any Subsidiary contributed or was
obligated to contribute during the six year period ending on the
Closing Date under Section 4062 or 4069 of ERISA. Neither the Company
nor any Subsidiary has incurred any material liability under Title IV
of ERISA which is likely to become or remain a liability of the
Company or any Subsidiary or Buyer after the Closing Date.
(iii) Except as set forth in Schedule 4(n) of the Disclosure
Schedule, (A) all contributions to the Plans that may have been
required to be made in accordance with Section 302 of ERISA or Section
412 of the Code have been timely made, (B) there has been no
application for or waiver of the minimum funding standards imposed by
Section 412 of the Code with respect to any Plan, (C) no Plan has an
"accumulated funding deficiency" within the meaning of Section 412(a)
of the Code as of the most recent plan year and (D) to the knowledge
of the Company, other than with respect to the inclusion of the
salaried employees of GMI Holdings, Inc. in the Overhead Door
Corporation Salaried Employees Pension Plan effective as of January 1,
1996, as of the close of business on June 27, 1996, no material
adverse change in the funding status of any of the defined benefit
plans of the Company or any of its Subsidiaries has occurred since the
most recent actuarial valuation report with respect to any such plan.
(iv) Except as set forth in Schedule 4(n) of the Disclosure
Schedule, each Plan that is intended to be "qualified" within the
meaning of Section 401(a) of the Code has been the subject of a
determination letter from the Internal Revenue Service to the effect
that such Plan is qualified and exempt from Federal income taxes under
Sections 401(a) and 501(a), respectively, of the Code, and no such
determination letter has been revoked nor, to the knowledge of the
Company, has revocation been threatened.
(v) None of the Company, any Subsidiary or, to the knowledge
of the Company, any of the Plans, any trust
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created thereunder or any trustee or administrator thereof, has
knowingly engaged in a transaction in connection with which the
Company or any Subsidiary is likely to be subject to either a material
liability or a material civil penalty assessed pursuant to Sections
409 or 502(i) or (1) of ERISA or a material tax imposed pursuant to
Section 4975 of the Code. Each of the Plans has been operated and
administered in all material respects in accordance with applicable
laws, including but not limited to ERISA and the Code. There are no
material pending or, to the best knowledge of the Company, threatened
claims by or on behalf of any of the Plans, by any employee or
beneficiary covered under any such Plan, or otherwise involving any
such Plan (other than routine claims for benefits).
(vi) No condition exists and no event has occurred with
respect to any "multiemployer plan" (as defined in Section 4001(a)(3)
of ERISA) with respect to which the Company or any Subsidiary is
obligated to make contributions pursuant to a collective bargaining
agreement that presents a material risk of a complete or partial
withdrawal under Subtitle E of Title IV of ERISA, nor has the Company
or any Subsidiary been notified that any such multiemployer plan is
insolvent or in reorganization within the meaning of Section 4241 of
ERISA. Except as set forth in Schedule 4(n) of the Disclosure
Schedule, neither the Company nor any Subsidiary is obligated to
contribute, on behalf of any current or former employee of the
Company, to a multiemployer plan.
(vii) Except as set forth in Schedule 4(n) of the Disclosure
Schedule, none of the Plans provides for or promises retiree medical,
disability or life insurance benefits to any current or former
employee, officer or director of the Company or any Subsidiary.
(viii) The Company and the Subsidiaries have not incurred
any liability under, and have complied in all material respects with,
the Worker Adjustment and Retraining Notification Act and the
regulations promulgated thereunder and do not reasonably expect to
incur any such liability as a result of actions taken or not taken
prior to the Closing Date.
(ix) The Options. No payment to holders of Options listed in
Appendix 1 in connection with the cash-out of their respective Options
pursuant to Section 6(d) will fail to be deductible by reason of
Section 280G of the Code.
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(o) Absence of Changes or Events. Except as set forth in
Schedule 4(o) of the Disclosure Schedule, since December 31, 1995,
there has not been any material adverse change in the business,
assets, financial condition or results of operations of the Company
and the Subsidiaries, taken as a whole, other than changes relating to
United States or foreign economies in general or the Company's and the
Subsidiaries' industries in general and not specifically relating to
the Company or a Subsidiary. Buyer acknowledges that there may have
been disruption to the Company's and the Subsidiaries' business as a
result of the marketing of the Company by Sellers to potential buyers
(and there may be disruption to the Company's and the Subsidiaries'
business as a result of the execution of this Agreement and the
consummation of the transactions contemplated hereby), and Buyer
agrees that such disruptions do not and shall not constitute a breach
of this Section 4(o). Except as set forth in Schedule 4(o) of the
Disclosure Schedule, from December 31, 1995 to the date of this
Agreement, the Company has caused its business and the business of the
Subsidiaries to be conducted in the ordinary course consistent with
past practice and has not done any of the things enumerated in clauses
(i)-(xv) of Section 6(b).
(p) Compliance with Applicable Laws. (i) Except as set forth
in Schedule 4(p) of the Disclosure Schedule, the Company and the
Subsidiaries are in compliance with all applicable statutes, laws,
ordinances, rules, orders and regulations of any Governmental Entity
("Applicable Laws"), including those relating to occupational health
and safety except for any such instances of noncompliance that,
individually or in the aggregate, would not have a Material Adverse
Effect. Except as set forth in Schedule 4(p) of the Disclosure
Schedule, neither the Company nor any Subsidiary has received any
written communication since January 1, 1993 from a Governmental Entity
that alleges that the Company or any Subsidiary is not in compliance
in any material respect with any Applicable Laws except where such
noncompliance would not have a Material Adverse Effect. This Section
4(p)(i) does not relate to matters with respect to environmental
matters, which are the subject of Section 4(p)(ii), Benefit Plans,
which are the subject of Section 4(n), employee and labor matters,
which are the subject of Section 4(q) or Taxes, which are the subject
of Section 4(g).
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(ii) (A) Except as set forth in Section 4(p)(ii) of the
Disclosure Schedule: (1) the Company and its Subsidiaries are in
compliance with Environmental Laws and all Environmental Permits
except where such non-compliance could not reasonably be expected to
have a Material Adverse Effect; (2) to the knowledge of the Company,
there are currently no underground storage tanks in which Hazardous
Materials have been or are currently being stored on any Company
Property; (3) to the knowledge of the Company, neither the Company nor
the Subsidiaries have Released Hazardous Materials on any Company
Property in a manner or an amount that can reasonably be expected to
require Remedial Action under Environmental Law; (4) neither the
Company nor its Subsidiaries are currently conducting, either
voluntarily or pursuant to the order of any Governmental Entity or the
requirements of any Environmental Law or Environmental Permits, any
Remedial Action relating to any Release or threatened Release of
Hazardous Materials at any Company Property; (5) there are no
Environmental Claims pending or, to the knowledge of the Company,
threatened against the Company or its Subsidiaries; and (6) the
Company and its Subsidiaries can maintain present production levels or
any planned expansion of production levels upon which financial
projections provided to Buyer have been based without material capital
expenditures required to comply with Environmental Laws.
(B) The Company has made available to Buyer copies of all
environmental assessment or audit reports in its possession relating
to the Company or its Subsidiaries.
(C) As used in this Section: (1) "Environment" means surface
waters, groundwaters, sediment, soil, subsurface strata and ambient
air; (2) "Environmental Claims" means any and all actions, suits,
demands, demand letters, claims, notices of non-compliance or
violation, notices of liability or potential liability, consent orders
or consent agreements under any Environmental Law or Environmental
Permit, relating to Hazardous Materials or arising from alleged injury
or threat of injury relating to the Environment; (3) "Environmental
Law" means any applicable Law, including any judicial or
administrative order, consent decree or judgment, relating to
pollution, protection of the Environment or to the use, handling,
transportation, treatment, storage, disposal or Release of Hazardous
Materials; (4) "Environmental Permit" means any permit, approval,
identification number, license or other authorization required to
operate the Company or any of its
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Subsidiaries under any applicable Environmental Law; (5) "Governmental
Entity" means any United States federal, state, or local government,
governmental regulatory or administrative authority, agency or
commission or any court, tribunal or judicial or arbitral body; (6)
"Hazardous Materials" means (a) petroleum and petroleum products,
by-products or fractions, radioactive materials, asbestos-containing
materials and polychlorinated biphenyls and (b) any other chemicals,
materials or substances regulated as toxic or hazardous under any
applicable Environmental Law; (7) "Release" means disposing,
discharging, injecting, spilling, leaking, leaching, dumping,
emitting, escaping, emptying, seeping or placing into or upon any land
or water or air or otherwise entering into the Environment; and (8)
"Remedial Action" means any investigation, assessment, monitoring,
treatment, excavation, removal, remediation or cleanup of Hazardous
Materials in the Environment.
(q) Employee and Labor Matters. Except as set forth in
Schedule 4(q) of the Disclosure Schedule, (i) there is, and since
January 1, 1993, there has been, no labor strike, work stoppage or
lockout pending against the Company or any Subsidiary, (ii) there is
no unfair labor practice charge or complaint against the Company or
any Subsidiary pending, or, to the knowledge of the Company,
threatened, before the National Labor Relations Board and (iii) there
are no pending, or, to the knowledge of the Company, threatened, union
grievances against the Company or any Subsidiary as to which there is
a reasonable probability of adverse determination and that, if so
determined, individually or in the aggregate, would have a Material
Adverse Effect.
(r) Inventories. The inventories of the Company and the
Subsidiaries whether reflected on the December 31, 1995 Balance Sheet
or subsequently acquired (the "Inventories") are generally of a
quality and quantity usable and salable at customary gross margins and
with customary markdowns consistent in all material respects with past
practice in the ordinary course of business. Except as set forth in
Schedule 4(r) of the Disclosure Schedule and except for Inventories
against which adequate reserves have been established in accordance
with generally accepted accounting principles, the Inventories do not
consist of, in any material amount, items that are obsolete, damaged
or slow-moving.
(s) No Undisclosed Liabilities. To the knowledge of the
Company, neither the Company nor any Subsidiary has any liability
material to the Company and the Subsidiaries
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taken as a whole that is of a nature required under generally accepted
accounting principles to be disclosed, reflected or reserved against
in the Financial Statements, other than liabilities (i) disclosed,
reflected or reserved against on the Financial Statements or the April
30, 1996 Balance Sheet, including the notes thereto, (ii) disclosed in
Schedule 4(s) of the Disclosure Schedule, or (iii) incurred since the
December 31, 1995 Balance Sheet in the ordinary course of business,
consistent with the past practice of the Company and the Subsidiaries.
(t) Permits. Except as set forth in Schedule 4(t) of the
Disclosure Schedule, the Company and the Subsidiaries have all
material licenses, permits and authorizations ("Permits") issued or
granted by Governmental Entities which are necessary to conduct the
business of the Company and the Subsidiaries as presently conducted
other than such Permits, the absence of which would not, individually
or in the aggregate, have a Material Adverse Effect. Except as set
forth in Schedule 4(t) of the Disclosure Schedule, all such Permits
are validly held by the Company or the relevant Subsidiary, the
Company and the Subsidiary have complied in all material respects with
all terms and conditions thereof, except for any instances where
noncompliance which would not, individually or in the aggregate, have
a Material Adverse Effect. None of such Permits will terminate upon
the consummation of the transactions contemplated by this Agreement,
other than any such Permits, the termination of which would not,
individually or in the aggregate, have a Material Adverse Effect. This
Section 4(t) does not relate to matters with respect to environmental
matters, which are the subject of Section 4(p)(ii).
(u) Certain Distributors and Customers. Schedule 4(u) to the
Disclosure Schedule sets forth a list of (i) the Overhead Door
Corporation "Ribbon" distributors as of the close of business on June
27, 1996, (ii) the top sixteen (16) Genie retail customers and the top
twenty-one (21) professional dealers based on GMI Holdings, Inc.'s
1995 fiscal year sales, (iii) the top seventy-eight (78) distributors
for the Horton Automatics division based on the Horton Automatics
division's 1995 fiscal year sales, (iv) the top nineteen (19)
customers of the TODCO division based on the TODCO division's 1995
fiscal year sales and (v) the top ten (10) distributors for the
McGuire division based on the McGuire division's 1995 fiscal year
sales.
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5. Representations and Warranties of Sellers. Each Seller
severally hereby represents and warrants to Buyer (as to such Seller
only) as follows:
(a) Execution. This Agreement has been duly authorized,
executed and delivered by such Seller and, assuming due authorization,
execution and delivery by the other parties hereto, constitutes a
legal, valid and binding obligation of such Seller, enforceable
against such Seller in accordance with its terms.
(b) No Conflicts. The execution and delivery of this
Agreement by such Seller does not, and the consummation of the
transactions contemplated hereby and compliance with the terms hereof
by such Seller will not, conflict with, or result in any violation of
or default (with or without notice or lapse of time, or both) under,
or give rise to a right of termination, cancellation, amendment or
acceleration of any obligation or to loss of any benefit under, or
result in the creation of any lien, claim, encumbrance, security
interest, option, charge or restriction of any kind upon any of the
properties or assets of such Seller under any provision of (i) the
governing instruments (if any) of such Seller, (ii) except as set
forth in Schedule 5(b) of the Disclosure Schedule, any note, bond,
mortgage, indenture, guaranty, deed of trust, license, lease,
contract, commitment, agreement or arrangement to which such Seller is
a party or (iii) any judgment, order or decree, or statute, law,
ordinance, rule or regulation applicable to such Seller, other than,
in the case of clauses (ii) and (iii) above, any such items that,
individually or in the aggregate, would not have a material adverse
effect on the ability of such Seller to consummate the transactions
contemplated hereby.
(c) The Shares. (i) Such Seller, directly or indirectly, has
good and valid title to the Shares to be sold by such Seller hereunder
as set forth in Schedule 5(c) of the Disclosure Schedule, free and
clear of any liens, pledges, mortgages, claims, encumbrances, security
interests, options, charges and restrictions of any kind.
(ii) Assuming Buyer has the requisite power and authority to
be the lawful owner of the Shares, upon delivery to Buyer at the
Closing of certificates representing such Shares, duly endorsed by
such Seller for transfer to Buyer, and upon such Seller's receipt of
the consideration to be received pursuant to Section 2, good and
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valid title to such Shares will pass to Buyer, free and clear of any
liens, pledges, mortgages, claims, encumbrances, security interests,
options, charges and restrictions of any kind, other than those
arising from acts of Buyer or its affiliates. Except as set forth in
Schedule 5(c) of the Disclosure Schedule, other than this Agreement,
such Shares are not subject to any voting trust agreement or other
contract, agreement, arrangement, commitment or understanding,
including any such agreement, arrangement, commitment or understanding
restricting or otherwise relating to the voting, dividend rights or
disposition of the Shares.
6. Covenants of the Company. The Company covenants and
agrees as follows:
(a) Access. Prior to the Closing, the Company shall, and
shall cause each Subsidiary, and their respective officers, employees
and auditors to, (i) give Buyer and its representatives, employees,
counsel and accountants reasonable access, during normal business
hours and upon reasonable notice, to the personnel, offices,
properties, books and records of the Company and each Subsidiary and
(ii) furnish to the representatives, employees, counsel and
accountants of the Buyer such financial and operating data and other
information reasonably available to the Company regarding the
business, assets and properties of the Company and the Subsidiaries as
the Buyer may reasonably request; provided, however, that such access
does not unreasonably disrupt the normal operations of the Company or
any Subsidiary. Nothing set forth herein shall obligate any employee
of the Company or any Subsidiary to provide any information regarding
the Company or any Subsidiary in any other format or otherwise to
manipulate or reconfigure any data regarding the Company's or any
Subsidiary's business, business prospects, assets, financial
performance or condition or operations. Nothing set forth in this
Agreement shall require any of the Company or any of its Subsidiaries
or the Sellers to provide Buyer with access to or copies of (i) any
information which must be maintained as confidential in accordance
with the terms of a written agreement with a third party or (ii)
sensitive customer information or pricing lists which in the Company's
reasonable business judgment should not be provided to Buyer until the
transactions contemplated hereby have been consummated in order to
avoid any material adverse effect on the Company's or any Subsidiary's
business, assets or financial condition.
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(b) Ordinary Conduct. Except as set forth in Schedule 6(b)
of the Disclosure Schedule or otherwise expressly permitted by the
terms of this Agreement, from the date hereof to the Closing, the
business of the Company and the Subsidiaries shall be conducted in the
ordinary course in substantially the same manner as presently
conducted and the Company shall make all reasonable efforts consistent
with past practices to (i) preserve existing relationships with
customers, suppliers, distributors and others with whom the Company or
any Subsidiary deals, (ii) preserve intact its and its Subsidiaries
respective business organizations and (iii) continue in full force and
effect without material modification all existing policies or binders
of insurance currently maintained in respect of the Company or any
Subsidiary, or the business thereof, subject to the continued
availability of such insurance on commercially reasonable terms.
Except as set forth in Schedule 6(b) of the Disclosure Schedule or
otherwise expressly permitted by the terms of this Agreement, neither
the Company nor any Subsidiary shall do any of the following without
the prior written consent of Buyer:
(i) amend its Articles of Incorporation or By-laws, or
comparable governing instruments;
(ii) declare or pay any dividend or make any other
distribution to its stockholders whether or not upon or in
respect of any shares of its capital stock; provided, however,
that (A) dividends and distributions may continue to be made by
the Subsidiaries to the Company, and from one wholly-owned
Subsidiary to another wholly-owned Subsidiary, and (B) dividends
with respect to the Preferred Shares may continue to be paid by
the Company in accordance with their terms as of the date hereof;
(iii) redeem or otherwise acquire any shares of its capital
stock or issue any capital stock (except upon redemption of
outstanding Preferred Shares in accordance with Section 6(c) or the
exercise of Options in accordance with their present terms or in
accordance with Section 6(d)) or redeem or otherwise acquire or issue
any notes, bonds or other securities (except for any scheduled
payments of such notes, bonds or other securities in accordance with
their terms), or any option, warrant or right relating thereto or any
securities convertible into or exchangeable for any shares of capital
stock;
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(iv) adopt, amend or terminate in any material respect any
Plan, any trust or other funding arrangement relating to a Plan,
or any collective bargaining agreement, or establish or increase
any benefit under any Plan except as required by law;
(v) grant to any executive officer or employee any increase
in compensation or benefits, except in the ordinary course of
business consistent with past practice or as may be required
under existing agreements;
(vi) incur or assume any liabilities, obligations or
indebtedness for borrowed money or guarantee any such
liabilities, obligations or indebtedness, other than borrowings
for working capital purposes in the ordinary course of business
consistent with past practice under the Revolving Credit Facility
and other than other borrowings in the ordinary course of
business consistent with past practice not in excess of $2
million; provided that in no event shall the Company or any
Subsidiary incur, assume or guarantee any long- term indebtedness
for borrowed money;
(vii) cancel any material indebtedness (individually or in
the aggregate) or waive any claims or rights of substantial value
to the Company and the Subsidiaries, taken as a whole, other than
in the ordinary course of business and other than in connection
with a bankruptcy proceedings in which the Company or a
Subsidiary is a creditor;
(viii) pay, loan or advance any amount to, or sell, transfer
or lease any of its assets to, or enter into any agreement or
arrangement with, any Seller or any of its affiliates other than the
Company and the Subsidiaries, except for dividends and distributions
permitted under clause (ii) above, intercompany transactions in the
ordinary course of business consistent with past practice, payment or
provision of compensation and benefits to directors and employees of
the Company or any Subsidiary in the ordinary course of business,
consistent with past practice, and payments made to Bessemer, Bessemer
Partners & Co., L.P, or any of their respective affiliates in
consideration for services connected with the management of certain of
the Company's employee benefit plans and for providing general
corporate, financial and administrative advice;
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(ix) make any change in any policy other than those required
by United States generally accepted accounting principles;
(x) acquire by merging or consolidating with, or by
purchasing a substantial portion of the assets of, or by any
other manner, any business or any corporation, partnership,
association or other business organization or division thereof or
otherwise acquire any assets (other than inventory) which are
material, individually or in the aggregate, to the Company and
the Subsidiaries, taken as a whole;
(xi) make or incur any material capital expenditure in
excess of $1.5 million individually or $3.0 million in the
aggregate for the period from June 1, 1996 to the Closing Date;
(xii) sell, transfer, license, lease or otherwise dispose of
any of its assets having a value in excess of $100,000
individually or $250,000 in the aggregate, except in the ordinary
course of business;
(xiii) enter into any sale or lease of real property, except
any renewals of existing leases in the ordinary course of
business;
(xiv) permit or allow any of the material assets or
properties (whether tangible or intangible) of the Company or any
Subsidiary to be subjected to any material Encumbrance, other
than Permitted Liens and other than Encumbrances that will be
released at or prior to the Closing; or
(xv) agree, whether in writing or otherwise, to do any of
the foregoing.
(c) Redemption of Preferred Stock. As of the time of the
Closing, the Company shall call for redemption all outstanding
Preferred Shares and, in accordance with its Articles of
Incorporation, as amended, effect such redemption immediately
following the Closing.
(d) Stock Options. Except as shall be otherwise agreed by
the Company and any person owning the right to purchase one or more
shares of Common Stock of the Company including any such rights held
in the form of warrants (each such right, including each such right
held in the form of a
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warrant being herein individually referred to as an "Option", and all
such rights, including all such rights held in the form of warrants,
herein collectively referred to as the "Options") (the terms of any
such agreement which amends or modifies the terms of any Option
outstanding on the date hereof shall be disclosed to and approved by
the Buyer prior to the Closing Date) and except with respect to
Options which in the aggregate account for not more than 0.8% of the
outstanding Common Stock of the Company on the Closing Date, the
Company shall provide, and pursuant to the terms of the agreements
relating to the Options between the holders of the Options ("Option
Holders") and the Company (the "Option Agreements"), shall use its
reasonable best efforts to cause such Option Holders to agree that (i)
immediately prior to the Closing Date, each outstanding Option,
whether or not then exercisable or vested, shall become fully
exercisable and vested (excluding any shares of Common Stock of the
Company subject to such Option that are no longer capable of being
vested in accordance with the terms of such Option on the Closing Date
and excluding any shares of Common Stock of the Company subject to
such Option that vest only on achievement of certain performance
levels or targeted rates of return which, in either case, have not
been achieved as of the Closing), (ii) each Option which is
outstanding at the Closing Date shall be cancelled and (iii) in
consideration of such cancellation, the Company shall pay to Bessemer,
on behalf of each such Option Holder, immediately following the
Closing an amount in respect thereof equal to (A) the excess, if any,
of the Per Share Purchase Price over the exercise price specified in
the related Option Agreement multiplied by (B) the aggregate number of
shares of the Company's Common Stock subject thereto (excluding any
shares of Common Stock of the Company subject to such Option that are
no longer capable of being vested in accordance with the terms of such
Option on the Closing Date and excluding any shares of Common Stock of
the Company subject to such Option that vest only on achievement of
certain performance levels or targeted rates of return which, in
either case, have not been achieved as of the Closing) (the "Spread"),
net of withholding taxes.
Except as otherwise agreed to by the Company and any Option
Holder (the terms of any such agreement which amends or modifies the
terms of any Option outstanding on the date hereof shall be disclosed
to and approved by the Buyer prior to the Closing Date), all Option
Agreements shall terminate as of the Closing Date, other than such
Option Agreements that relate to Options which have not been
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cancelled on the Closing and which in the aggregate account for not
more than 0.8% of the outstanding Common Stock of the Company on the
Closing Date, and the provisions in any other plan, program, agreement
or arrangement providing for the issuance or grant of any other
interest in respect of the capital stock of the Company shall be
deleted as of the Closing Date.
(e) Certain Resignations. The Company shall have obtained
the resignations, effective as of the Closing, of all the directors
and officers of the Company and each Subsidiary, except for such
persons as shall have been designated in writing at least two business
days prior to the Closing by the Buyer to the Company.
(f) Individuals to Receive Notice of Approved Sale. The
Company shall promptly following the signing of this Agreement, and in
any event within two business days thereafter, deliver a notice to
each person listed on Schedule 6(f) of the Disclosure Schedule stating
that the Board of Directors of the Company desires to consummate an
Approved Sale (as such term is defined in Section 7A of the
Stockholders Agreement dated as of January 9, 1990, by and among DCO
Holdings Corp., Bessemer Securities Corporation, MH Equity Corp. and
the individuals identified on the signature pages thereof as
Management Purchasers, as amended by the First Amendment and Waiver to
the Stockholders Agreement dated as of January 9, 1995, by and among
the Company, Bessemer (as successor-in-interest to Bessemer Securities
Corporation), CBC Capital Partners, Inc. (as successor-in-interest to
MH Equity Corp.) and the Management Purchasers party thereto (as
amended, the "Amended Stockholders Agreement")) and that such person
will be required to sell to Buyer all of his shares of Restricted
Voting Stock (as such term is defined in the Amended Stockholders
Agreement), including all Shares and Options, held by such person on
the terms and conditions set forth herein.
7. Representations and Warranties of Buyer. Buyer hereby
represents and warrants to Sellers as follows:
(a) Authority. Buyer is a corporation duly organized,
validly existing and in good standing under the laws of Japan. Buyer
has all requisite corporate power and authority to enter into this
Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby. All acts and other proceedings
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required to be taken by Buyer to authorize the execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated hereby have been duly and properly taken. This Agreement
has been duly authorized, executed and delivered by Buyer and,
assuming due authorization, execution and delivery by the other
parties hereto, constitutes a legal, valid and binding obligation of
Buyer, enforceable against Buyer in accordance with its terms.
(b) No Conflicts; Consents. The execution and delivery of
this Agreement by the Buyer does not, and the consummation of the
transactions contemplated hereby and compliance with the terms hereof
by the Buyer will not, conflict with, or result in any violation of or
default (with or without notice or lapse of time, or both) under, or
give rise to a right of termination, cancellation, amendment or
acceleration of any obligation or to loss of any benefit under, or
result in the creation of any lien, claim, encumbrance, security
interest, option, charge or restriction of any kind upon any of the
properties or assets of Buyer or any subsidiary of Buyer under, any
provision of (i) the Certificate of Incorporation or By-laws of Buyer
or the comparable governing instruments of any subsidiary of Buyer,
(ii) any note, bond, mortgage, indenture, guaranty, deed of trust,
license, lease, contract, commitment, agreement or arrangement to
which Buyer or any subsidiary of Buyer is a party or by which any of
their respective properties or assets are bound or encumbered or (iii)
any judgment, order, or decree, or statute, law, ordinance, rule or
regulation applicable to Buyer or any subsidiary of Buyer or their
respective properties or assets, other than, in the case of clauses
(ii) and (iii) above, any such items that, individually or in the
aggregate, would not have a material adverse effect on the ability of
Buyer to consummate the transactions contemplated hereby and perform
all its obligations hereunder. No material consent, approval, license,
permit, order or authorization of, or registration, declaration or
filing with, any Governmental Entity is required to be obtained or
made by or with respect to Buyer or any of its subsidiaries or their
respective affiliates in connection with the execution, delivery and
performance of this Agreement or the consummation of the transactions
contemplated hereby, other than (i) compliance with and filings under
the HSR Act, if applicable, (ii) compliance with and filings and
notifications under applicable environmental laws and (iii) those that
may be required solely by reason of Sellers' (as opposed to any other
third
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party's) participation in the transactions contemplated
hereby.
(c) Securities Act. The Shares purchased by Buyer pursuant
to this Agreement are being acquired for investment only and not with
a view to any public distribution thereof, and Buyer acknowledges that
the Shares are not registered under the Securities Act and may not be
offered, transferred, sold or otherwise disposed of except pursuant to
the registration provisions thereof or an exemption from the
registration requirements thereof.
(d) Actions and Proceedings, etc. There are no (i)
outstanding judgments, orders, injunctions or decrees of any
Governmental Entity or arbitration tribunal against Buyer or any of
its affiliates, (ii) lawsuits, actions or proceedings pending or, to
the knowledge of Buyer, threatened against Buyer or any of its
affiliates or (iii) investigations by any Governmental Entity which
are, to the knowledge of Buyer, pending or threatened against Buyer or
any of its affiliates, and which, in the case of each of clauses (i),
(ii) and (iii), have or could have a material adverse effect on the
ability of Buyer to consummate the transactions contemplated hereby
and perform all its obligations hereunder.
(e) Availability of Funds. Buyer has cash, time deposits and
marketable securities available sufficient to enable it to consummate
the transactions contemplated by this Agreement.
8. Covenants of Buyer. Buyer covenants and agrees as
follows:
(a) Confidentiality. Buyer acknowledges that the information
being provided to it in connection with the purchase and sale of the
Shares and the consummation of the other transactions contemplated
hereby is subject to the terms of a confidentiality agreement between
Buyer and the Company (the "Confidentiality Agreement"), the terms of
which are incorporated herein by reference. Buyer also acknowledges
that the Sellers have no obligation or liability of any kind
whatsoever to Buyer or any other person by virtue of the
Confidentiality Agreement. Effective upon, and only upon, the Closing,
the Confidentiality Agreement shall terminate with respect to
information relating solely to the Company and the Subsidiaries;
provided that Buyer acknowledges that any and
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all other information provided to it by the Company or Sellers, or the
Company's or Sellers' representatives concerning Sellers shall remain
subject to the terms and conditions of the Confidentiality Agreement
after the Closing Date.
(b) No Additional Representations. Buyer acknowledges that
none of Sellers, the Company, any Subsidiary or any other person has
made any representation or warranty, expressed or implied, as to the
accuracy or completeness of any information regarding the Company and
the Subsidiaries furnished or made available to Buyer and its
representatives, except as expressly set forth in this Agreement or
the Disclosure Schedule and there are no other representations or
warranties made by Sellers, the Company, any Subsidiary or any other
person with respect to the transactions contemplated by this
Agreement, and none of Sellers, the Company, any Subsidiary or any
other person shall have or be subject to any liability to Buyer or any
other person resulting from the distribution to Buyer, or Buyer's use
of, any such information, including the Confidential Offering
Memorandum prepared by Morgan Stanley & Co. Incorporated and Smith
Barney Inc. and any information, documents or material made available
to Buyer by Sellers, the Company, any Subsidiary or their partners,
directors, officers, employees, agents or advisors in certain "data
rooms", management presentations or in any other form in expectation
of the transactions contemplated by this Agreement.
(c) Payment of Certain Taxes. Buyer shall pay all transfer,
documentary, sales, use, registration and other such taxes (including,
but not limited to, all applicable real estate transfer or gains
taxes) and fees (including any penalties, interest and additions to
such taxes) incurred in connection with this Agreement and the
transactions contemplated hereby (other than stock transfer taxes),
and Sellers and Buyer shall cooperate in timely making all filings,
returns, reports and forms as may be required to comply with the
provisions of such tax laws. Sellers shall pay any stock transfer
taxes due as a result of the sale of the Shares.
(d) Redemption of Preferred Shares. In connection with the
Closing, Buyer shall provide to the Company all funds necessary to
effect the redemption of the Preferred Shares contemplated by Section
6(c) including, without limitation, funds necessary to pay, in cash,
the
Page 44 of 67
<PAGE>
liquidation preference thereof and all accrued and unpaid dividends
thereon to the Closing Date. Buyer shall cause the Company immediately
after the Closing to pay to the holders of the Preferred Shares the
amounts payable as a result of such redemption. Appendix 4 sets forth
the amounts payable as a result of such redemption, calculated as if
the Closing occurs on July 18, 1996. If a holder of Preferred Shares
shall have designated a bank account in writing at least two business
days prior to the Closing Date, the amount to be paid to such holder
pursuant to this Section 8(d) shall be paid on the Closing Date by
wire transfer to such account in immediately available funds.
(e) Option Payments. In connection with the Closing, Buyer
shall provide to the Company all funds necessary to effect the
cancellation of the Options contemplated by Section 6(d) including,
without limitation, funds necessary to pay the aggregate consideration
to be paid to all holders of Options pursuant to clause (iii) of
Section 6(d). Buyer shall cause the Company immediately after the
Closing to pay to Bessemer, on behalf of the holders of Options, the
amounts payable as provided in Section 6(d). Appendix 5 sets forth the
aggregate of such amounts, before withholding taxes, broken down by
type of Option Agreement, calculated as if the Closing occurs on July
18, 1996 and assuming Net Long Term Debt is $194,820,831 and all
Options outstanding on the date hereof are outstanding and have not
been exercised at the Closing Date. If Bessemer shall have designated
a bank account in writing at least two business days prior to the
Closing Date, the amount to be paid to Bessemer, on behalf of the
holders of Options, pursuant to this Section 8(e) shall be paid on the
Closing Date by wire transfer to such account in immediately available
funds.
(f) Certain Company Indebtedness. Buyer acknowledges and
agrees that (i) unless the holders of the 12.25% Notes agree to waive
or amend the terms of their 12.25% Notes prior to the Closing Date,
upon consummation of the transactions contemplated by this Agreement,
such holders will obtain the right to cause the Company to repurchase
their 12.25% Notes; (ii) neither the Company nor the Sellers has
sought or is required to seek such a waiver or amendment; and (iii)
accordingly, the Company may be required to repurchase all or part of
the 12.25% Notes following the Closing pursuant to the terms thereof.
Buyer also acknowledges and agrees that (i) unless banks party to the
Credit Facility agree to waive or amend the Credit
Page 45 of 67
<PAGE>
Facility prior to the Closing Date, the consummation of the
transactions contemplated by this Agreement will result in (1) the
Term Loan Facility becoming immediately due and payable and (2)
breaches by the Company of certain covenants under the Credit Facility
which, if continued unremedied for a period of at least 30 days after
notice to the Company, could result in the Term Loan Facility and the
Revolving Credit Facility becoming immediately due and payable, which
in turn would trigger a default under the 12.25% Notes, which, if
continued for 10 days after notice thereof to Overhead Door
Corporation, could trigger an acceleration of the 12.25% Notes; (ii)
neither the Company nor the Sellers has sought or is required to seek
such a waiver or amendment as a condition to the Buyer's obligation to
consummate the transaction contemplated hereby; and (iii) Buyer shall
as of the Closing either (x) provide Overhead Door Corporation with
funds necessary for Overhead Door Corporation to repay, and cause
Overhead Door Corporation to repay, in full the Term Loan Facility and
the Revolving Credit Facility upon the consummation of the
transactions contemplated by this Agreement or (y) obtain a waiver of
any breaches of the provisions of the Credit Facility that occur or
with the passage of time or notice or both will occur as a result of
the consummation of the transactions contemplated by this Agreement
and a waiver of the applicability of any change of control provisions
of the Credit Facility.
9. Mutual Covenants. Each of the parties covenants and
agrees as follows:
(a) Consents. Prior to the Closing, (i) the Company shall,
and shall cause the Subsidiaries to use their reasonable best efforts
to obtain all consents and waivers from, and to provide such notices
to, third parties as may be required, or as Buyer may deem reasonably
necessary, in connection with the transactions contemplated by this
Agreement and (ii) the Company shall use its reasonable best efforts
to obtain all authorizations, consents, orders and approvals of all
Governmental Entities and officials that are necessary for the
execution, delivery and performance of this Agreement by the Company
and the Sellers, and the Company will cooperate fully with the Buyer
in promptly seeking to obtain all such authorizations, consents,
orders and approvals; provided, however, that such reasonable best
efforts shall not include any requirement that the Company or the
Subsidiaries expend money, commence or participate in any litigation
or offer or grant any accommodation (financial or otherwise) to any
third party. Prior to the
Page 46 of 67
<PAGE>
Closing, Sellers shall cooperate with Buyer, upon the request of
Buyer, in any reasonable manner in connection with Buyer obtaining any
such consents and waivers; provided, however, that such cooperation
shall not include any requirement of Sellers or any of their
respective affiliates (including the Company and the Subsidiaries) to
expend money, commence or participate in any litigation or offer or
grant any accommodation (financial or otherwise) to any third party.
(b) After the Closing, upon reasonable written notice, Buyer
on the one hand, and Sellers, on the other hand, shall furnish or
cause to be furnished to each other and their employees, counsel,
auditors and representatives access, during normal business hours, to
such information and assistance relating to the Company and the
Subsidiaries as is reasonably necessary for financial reporting and
accounting matters, the preparation and filing of any tax returns,
reports or forms or the defense of any tax claim or assessment. Each
party shall reimburse any other party for reasonable out-of-pocket
costs and expenses incurred in assisting such party pursuant to this
Section 9(b). No party shall be required by this Section 9(b) to take
any action that would unreasonably interfere with the conduct of its
business, as presently conducted, or, in the case of certain of the
Sellers, their personal affairs or unreasonably disrupt the normal
operations of the Company, the Subsidiaries or Buyer.
(c) Publicity. The Company, Sellers and Buyer agree that,
from the date hereof through the Closing Date, no public release or
announcement concerning the transactions contemplated hereby shall be
issued by any party without the prior consent of the other parties
(which consent shall not be unreasonably withheld), except as such
release or announcement may be required by law or the rules or
regulations of any United States or foreign securities exchange, in
which case the party required to make the release or announcement
shall allow the other parties reasonable time to comment on such
release or announcement in advance of such issuance.
(d) Reasonable Best Efforts. Subject to the terms and
conditions of this Agreement (including the provisions set forth in
Section 9(a)), each party shall use its reasonable best efforts to
cause the Closing to occur.
Page 47 of 67
<PAGE>
(e) Antitrust Notification. Bessemer and Buyer shall as
promptly as practicable, but in no event later than five business days
following the execution and delivery of this Agreement, file with the
United States Federal Trade Commission (the "FTC") and the United
States Department of Justice (the "DOJ") the notification and report
form, if any, required for the transactions contemplated hereby and
any supplemental information requested in connection therewith
pursuant to the HSR Act. Any such notification and report form and
supplemental information shall be in substantial compliance with the
requirements of the HSR Act. Each of Bessemer, the Company and Buyer
shall furnish to the other such necessary information and reasonable
assistance as the other may request in connection with its preparation
of any filing or submission which is necessary under the HSR Act.
Bessemer and Buyer shall keep each other apprised of the status of any
communications with, and any inquiries or requests for additional
information from, the FTC and the DOJ and shall comply promptly with
any such inquiry or request. Each of Bessemer, the Company and Buyer
shall use its best efforts to obtain any clearance required under the
HSR Act for the purchase and sale of the Shares; provided that Buyer
shall be solely responsible for any filing fees payable by Buyer under
the HSR Act.
(f) Supplemental Disclosure. Buyer shall promptly notify
Sellers of, and furnish each Seller any information such Seller may
reasonably request with respect to, the occurrence to Buyer's
knowledge, of any event or condition or the existence to Buyer's
knowledge, of any fact that would cause any of the conditions to
Sellers' obligations to consummate the sale of the Shares not to be
fulfilled. The Company and Sellers shall promptly notify Buyer of, and
furnish to Buyer any information Buyer may reasonably so request with
respect to the occurrence to the Company's or Sellers' knowledge, as
the case may be, of any event or condition or the existence to the
Company's or Sellers' knowledge, as the case may be, of any fact that
would cause any of the conditions to Buyer's obligations to consummate
the purchase of the Shares not to be fulfilled.
10. Further Assurances. From time to time, as and when
requested by a party hereto of another party hereto, the other party
shall use all reasonable efforts to execute and deliver, or cause to
be executed and delivered, all such documents and instruments and
shall take, or cause to be taken, all such further or other actions
(subject to the provisions of Section 9(a)), as may reasonably be
Page 48 of 67
<PAGE>
necessary to consummate the transactions contemplated by this
Agreement.
11. Assignment. This Agreement and the rights and
obligations hereunder shall not be assignable or transferable by any
party hereto (including by operation of law in connection with a
merger, or sale of substantially all the assets, of any party hereto)
without the prior written consent of the other parties hereto;
provided, however, that Buyer may assign its right to purchase the
Shares hereunder to a wholly owned subsidiary of Buyer without the
prior written consent of Sellers; provided further, however, that no
assignment shall limit or affect the assignor's obligations hereunder.
Any attempted assignment in violation of this Section 11 shall be
void.
12. No Third-Party Beneficiaries. This Agreement is for the
sole benefit of the parties hereto and their permitted assigns and
nothing herein expressed or implied shall give or be construed to give
to any person, other than the parties hereto and such assigns, any
legal or equitable rights hereunder.
13. Termination. (a) Anything contained herein to the
contrary notwithstanding, this Agreement may be terminated and the
transactions contemplated hereby abandoned at any time prior to the
Closing Date:
(i) by mutual written consent of Bessemer, on behalf of the
Sellers, and Buyer;
(ii) by Bessemer, on behalf of the Sellers, if any of the
conditions set forth in Section 3(b) shall have become incapable
of fulfillment, and shall not have been waived by Sellers;
(iii) by Buyer if any of the conditions set forth in Section
3(a) shall have become incapable of fulfillment, and shall not
have been waived by Buyer; or
(iv) by Bessemer, on behalf of the Sellers, or Buyer, if the
Closing does not occur on or prior to the later of August 1, 1996
and the fifth business day following the expiration or
termination of any waiting period under the HSR Act, unless
otherwise extended by Bessemer, on behalf of the Sellers, and the
Buyer;
Page 49 of 67
<PAGE>
provided, however, that the right to terminate this Agreement pursuant
to clause (ii), (iii) or (iv) shall not be available to any party
whose failure to fulfill any obligation under this Agreement shall
have been the cause of, or shall have resulted in, such right of
termination.
(b) In the event of termination by Bessemer, on behalf of
the Sellers, or Buyer pursuant to this Section 13, written notice
thereof shall forthwith be given to the other party and the
transactions contemplated by this Agreement shall be terminated,
without further action by either party. If the transactions
contemplated by this Agreement are terminated as provided herein:
(i) Buyer shall return all documents and other material
(including all copies thereof, whether maintained in hard copy,
on computer disk or on computer hard drive) received from the
Company, any Subsidiary or Sellers relating to the transactions
contemplated hereby, whether so obtained before or after the
execution hereof, to Bessemer;
(ii) all confidential information received by Buyer with
respect to the business of the Company and the Subsidiaries shall
be treated in accordance with the Confidentiality Agreement,
which shall remain in full force and effect notwithstanding the
termination of this Agreement.
(c) If this Agreement is terminated and the transactions
contemplated hereby are abandoned as described in this Section 13,
this Agreement shall become void and of no further force or effect,
except for the provisions of (i) Section 8(a) relating to the
obligation of Buyer to keep confidential certain information and data
obtained by it, (ii) Section 15 relating to certain expenses, (iii)
Section 9(c) relating to publicity, (iv) Section 21 relating to
finder's fees and broker's fees, and (v) this Section 13. Nothing in
this Section 13 shall be deemed to release any party from any
liability for any breach by such party of the terms and provisions of
this Agreement or to impair the right of any party to compel specific
performance by any other party of its obligations under this
Agreement.
14. Survival of Representations. The representations and
warranties in this Agreement and in any certificate delivered pursuant
hereto shall not survive the Closing.
Page 50 of 67
<PAGE>
15. Expenses. (a) Whether or not the transactions
contemplated hereby are consummated, and except as otherwise
specifically provided in this Agreement, (i) all costs and expenses
incurred by Buyer in connection with this Agreement and the
transactions contemplated hereby, including the fees and expenses of
Shearman & Sterling and Daiwa Securities Co. Ltd. shall be paid by
Buyer and (ii) all costs and expenses incurred by the Company in
connection with this Agreement and the transactions contemplated
hereby, including the fees and expenses of Cravath, Swaine & Moore,
Morgan Stanley & Co. Incorporated, Smith Barney Inc. and Ernst & Young
shall be paid by the Company, except that if the transactions
contemplated by this Agreement close on the Closing Date, then the
fees and expenses of Cravath, Swaine & Moore, Morgan Stanley & Co.
Incorporated and Smith Barney Inc. shall be paid by the holders of
Shares who sell to Buyer at the Closing and the Option Holders who
agree to have their Options cancelled at the Closing, in each case on
a pro rata basis in accordance with the number of Shares to be sold by
each holder of Shares and the number of Shares subject to the
Option(s) so held by each Option Holder, as the case may be.
(b) A party in breach of this Agreement shall, on demand,
indemnify and hold harmless any other party for and against all
reasonable out-of-pocket expenses, including legal fees, incurred by
such other party by reason of the enforcement and protection of its
rights under this Agreement. The payment of such expenses is in
addition to any other relief to which such other party may be
entitled.
16. Amendments. No amendment, modification or waiver in
respect of this Agreement shall be effective unless it shall be in
writing and signed by both Bessemer, on behalf of Sellers, and Buyer.
17. Notices. All notices or other communications required or
permitted to be given hereunder shall be in writing and shall be
delivered by hand or sent by prepaid telex, cable or telecopy or sent,
postage prepaid, by registered, certified or express mail or reputable
overnight courier service, and shall be deemed given when so delivered
by hand, telexed, cabled or telecopied, or if mailed, three
Page 51 of 67
<PAGE>
days after mailing (one business day in the case of express mail
or overnight courier service), as follows:
(i) if to Buyer,
Sanwa Shutter Corporation
1-1, Nishi-Shinjuku, 2-Chome
Shinjuku, Tokyo, Japan
Attention: Kiyoshi Hashimoto
Senior Managing Director
with a copy to:
Shearman & Sterling
599 Lexington Avenue
New York, NY 10022
Attention: Alfred J. Ross, Jr.
(ii) if to the Company,
Overhead Door Incorporated
6750 LBJ Freeway
Dallas, Texas 75240
Attention: William A. Schochet,
Vice President and
General Counsel
with a copy to:
Cravath, Swaine & Moore
Worldwide Plaza
825 Eighth Avenue
New York, New York 10019
Attention: Susan Webster;
(iii) if to Bessemer,
Bessemer Holdings, L.P.
630 Fifth Avenue
New York, New York 10111
Attention: Michael B. Rothfeld
Page 52 of 67
<PAGE>
with a copy to:
Cravath, Swaine & Moore
Worldwide Plaza
825 Eighth Avenue
New York, New York 10019
Attention: Susan Webster; and
(iv) if to any other Seller to,
Bessemer Holdings, L.P.
630 Fifth Avenue
New York, New York 10111
Attention: Michael B. Rothfeld
with a copy to:
Cravath, Swaine & Moore
Worldwide Plaza
825 Eighth Avenue
New York, New York 10019
Attention: Susan Webster.
18. Interpretation; Exhibits and Schedules; Certain
Definitions. The headings contained in this Agreement, in any Exhibit
or Schedule hereto and in the table of contents to this Agreement are
for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. All Exhibits and
Schedules annexed hereto or referred to herein are hereby incorporated
in and made a part of this Agreement as if set forth in full herein.
Any capitalized terms used in any Schedule or Exhibit but not
otherwise defined therein, shall have the meaning as defined in this
Agreement.
(i) "including" means including, without limitation;
(ii) "knowledge" of the Company means the knowledge after
due inquiry of Brian J. Bolton, Fred S. Grunewald, Howard R.
Simmons, James F. Brum, C. Michael Budd, William A. Schochet,
John Venema, any director of the Company or, with respect to the
representations and
Page 53 of 67
<PAGE>
warranties set forth in Section 4(p)(ii) only, Charles
Poole;
(iii) "knowledge" of Buyer means the knowledge after due
inquiry of any executive officer or director of Buyer;
(iv) "person" means any individual, firm, corporation,
partnership, limited liability company, trust, joint venture,
Governmental Entity or other entity.
19. Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same
agreement, and shall become effective when one or more such
counterparts have been signed by each of the parties and delivered to
both Buyer and Bessemer, as representative for the Sellers.
20. Entire Agreement. This Agreement and the Confidentiality
Agreement contain the entire agreement and understanding between the
parties hereto with respect to the subject matter hereof and supersede
all prior agreements and understandings relating to such subject
matter. No party shall be liable or bound to any other party in any
manner by any representations, warranties or covenants relating to
such subject matter except as specifically set forth herein or in the
Confidentiality Agreement.
21. Brokers. Each party hereto hereby represents and
warrants that the only brokers or finders that have acted for such
party in connection with this Agreement or the transactions
contemplated hereby or that may be entitled to any brokerage fee,
finder's fee or commission in respect thereof are Morgan Stanley & Co.
Incorporated and Smith Barney Inc. with respect to the Company and
Daiwa Securities Co. Ltd. with respect to Buyer.
22. Severability. If any provision of this Agreement (or any
portion thereof) or the application of any such provision (or any
portion thereof) to any person or circumstance shall be held invalid,
illegal or unenforceable in any respect by a court of competent
jurisdiction, such invalidity, illegality or unenforceability shall
not affect any other provision hereof (or the remaining portion
thereof) or the application of such provision to any other persons or
circumstances.
Page 54 of 67
<PAGE>
23. Consent to Jurisdiction. Each of the parties hereto
irrevocably submits to the exclusive jurisdiction of (a) the Supreme
Court of the State of New York, New York County, and (b) the United
States District Court for the Southern District of New York, for the
purposes of any suit, action or other proceeding arising out of this
Agreement or any transaction contemplated hereby. Each of the parties
hereto agrees to commence any action, suit or proceeding relating
hereto either in the United States District Court for the Southern
District of New York or if such suit, action or other proceeding may
not be brought in such court for jurisdictional reasons, in the
Supreme Court of the State of New York, New York County. Each of the
parties hereto further agrees that service of any process, summons,
notice or document by U.S. registered mail to such party's respective
address set forth above shall be effective service of process for any
action, suit or proceeding in New York with respect to any matters to
which it has submitted to jurisdiction in this Section 23. Each of the
parties hereto irrevocably and unconditionally waives any objection to
the laying of venue of any action, suit or proceeding arising out of
this Agreement or the transactions contemplated hereby in (i) the
Supreme Court of the State of New York, New York County, or (ii) the
United States District Court for the Southern District of New York,
and hereby further irrevocably and unconditionally waives and agrees
not to plead or claim in any such court that any such action, suit or
proceeding brought in any such court has been brought in an
inconvenient forum.
24. Confidentiality. (a) Following the Closing Date, each
Seller shall keep confidential, and shall instruct its officers,
directors, employees and advisors to keep confidential, all
information of a confidential and proprietary nature relating to trade
secrets, processes, plant and trademark applications, product
development, price, customer and supplier lists, pricing and marketing
plans, policies and strategies, details of client and consultant
contracts, operations methods, product development techniques,
business acquisition plans, new personnel acquisition plans and all
other information with respect to the business of the Company and the
Subsidiaries (collectively, the "Information"), except (i) for
Information which is available to the public on the Closing Date, or
thereafter becomes available to the public other than as a result of a
breach of this Section 24, (ii) with the Company's prior written
consent and (iii) as required by applicable law, regulation or legal
process. The covenant
Page 55 of 67
<PAGE>
set forth in this Section 24 shall terminate three (3) years after the
Closing Date.
25. Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New
York applicable to agreements made and to be performed entirely within
such State, without regard to the conflicts of law principles of such
State.
Page 56 of 67
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement
to be duly executed as of the date first written above.
SANWA SHUTTER CORPORATION,
By /s/Toshitaka Takayama
----------------------
Name: Toshitaka Takayama
Title: President
OVERHEAD DOOR INCORPORATED,
By /s/Brian J. Bolton
----------------------
Name: Brian J. Bolton
Title: President & CEO
BESSEMER HOLDINGS, L.P.,
By KYLIX HOLDINGS, L.L.C.,
its General Partner
By NORTH HARBOR CORPORATION,
a Manager
By /s/Michael B. Rothfeld
----------------------
Name: Michael B. Rothfeld
Title: President
Page 57 of 67
<PAGE>
BESSEMER HOLDINGS SPECIAL
SITUATIONS, L.P.,
By KYLIX HOLDINGS, L.L.C.,
its General Partner
By NORTH HARBOR CORPORATION,
a Manager
By /s/Michael B. Rothfeld
-----------------------
Name: Michael B.Rothfeld
Title: President
ODI PARTNERS, L.P.,
By KYLIX HOLDINGS, L.L.C.,
its General Partner
By NORTH HARBOR CORPORATION,
a Manager
By /s/Michael B. Rothfeld
-----------------------
Name: Michael B. Rothfeld
Title: President
BRIAN J. BOLTON,
By /s/Brian J. Bolton
------------------
Name: Brian J. Bolton
Page 58 of 67
<PAGE>
APPENDIX 1
----------
<TABLE>
<CAPTION>
Options/ Exercise Exercise
Warrants Price Proceeds
-------- ----- --------
<S> <C> <C> <C>
ODI 1990 Stock Option Plan:
Bolton 129,381 $0.0000 $0
Rengert 21,562 0.0000 0
------ -
Subtotal ODI 1990 Stock
Option Plan 150,943
ODI Warrants Vested:
Bolton 530,265 0.257 13,628
Simmons 100,469 0.257 2,582
------- -----
Subtotal ODI Warrants Vested 630,734 16,210
ODI Options (Converted from
Warrants):
Simmons 110,471 10.0000 1,104,710
ODI 1994 Stock Option Plan:
Bolton 200,000 10.0000 2,000,000
Rengert 52,500 10.0000 525,000
Simmons 125,000 10.0000 1,250,000
Schochet 45,000 10.0000 450,000
Brum 100,000 10.0000 1,000,000
Macaulay 21,000 10.0000 210,000
Thompson 50,000 10.0000 500,000
Grunwald 400,000 10.0000 4,000,000
Venema 75,000 10.0000 750,000
Budd 125,000 10.0000 1,250,000
Haley 52,500 10.0000 525,000
Zilliox 52,500 10.0000 525,000
Horrigan 50,000 10.0000 500,000
------ -------
Subtotal ODI 1994 Stock
Option Plan 1,348,500 13,485,000
GMI Holdings, Inc. Rollover
Stock Option Plan:
Rubin 67,680 0.7300 49,406
Rubin 48,362 2.7600 133,479
Budd 91,860 1.3100 120,337
Horrigan 62,180 2.7600 171,617
------ -------
Subtotal GMI Holdings, Inc.
Rollover Stock Option Plan 270,082 474,839
------- -------
Total 2,510,730 $6.0065 $15,080,759
========= ======= ===========
</TABLE>
03:20 PM 28-JUN-96
Page 59 of 67
<PAGE>
APPENDIX 2
Scheduled Option Agreements
---------------------------
(1) DCO Holdings Corp. Amended Stock Option Agreements dated June 15,
1993, by and between DCO Holdings Corp. (now known as Overhead
Door Incorporated) and Roy Adams.
(a) DCO Holdings Corp. Incentive Stock Option Agreement dated
January 9, 1990, by and between DCO Holdings Corp. (now
known as Overhead Door Incorporated) and Roy Adams in
respect of the grant of an option to purchase 13,958 shares
of common stock of DCO Holdings Corp.
(b) DCO Holdings Corp. Incentive Stock Option Agreement dated
January 9, 1990, by and between DCO Holdings Corp. (now
known as Overhead Door Incorporated) and Roy Adams in
respect of the grant of an option to purchase 11,073 shares
of common stock of DCO Holdings Corp.
(c) DCO Holdings Corp. Nonqualified Stock Option Agreement dated
January 9, 1990, by and between DCO Holdings Corp. (now
known as Overhead Door Incorporated) and Roy Adams in
respect of the grant of an option to purchase 6,368 shares
of common stock of DCO Holdings Corp.
(2) DCO Holdings Corp. Amended Stock Option Agreements dated
September 26, 1991, by and between DCO Holdings Corp. (now known
as Overhead Door Incorporated) and Howard A. Bacon.
(a) DCO Holdings Corp. Incentive Stock Option Agreement dated
January 9, 1990, by and between DCO Holdings Corp. (now
known as Overhead Door Incorporated) and Howard A. Bacon in
respect of the grant of an option to purchase 15,703 shares
of common stock of DCO Holdings Corp.
Page 60 of 67
<PAGE>
(3) DCO Holdings Corp. Amended Stock Option Agreements dated October
8, 1992, by and between DCO Holdings Corp. (now known as Overhead
Door Incorporated) and Alan R. Bashor.
(a) DCO Holdings Corp. Incentive Stock Option Agreement dated
January 9, 1990, by and between DCO Holdings Corp. (now
known as Overhead Door Incorporated) and Alan R. Bashor in
respect of the grant of an option to purchase 11,341 shares
of common stock of DCO Holdings Corp.
(4) DCO Holdings Corp. Incentive Stock Option Agreement dated January
9, 1990, by and between DCO Holdings Corp. (now known as Overhead
Door Incorporated) and Brian J. Bolton in respect of the grant of
an option to purchase 52,345 shares of common stock of DCO
Holdings Corp.
(5) DCO Holdings Corp. Incentive Stock Option Agreement dated January
9, 1990, by and between DCO Holdings Corp. (now known as Overhead
Door Incorporated) and Daniel C. Rengert in respect of the grant
of an option to purchase 8,724 shares of common stock of DCO
Holdings Corp.
Page 61 of 67
<PAGE>
<TABLE>
ODI 1990 Stock Option Plan
<CAPTION>
Options/ Exercise
Warrants Price
<S> <C> <C>
ODI 1990 Stock Option Plan:
Bolton 129,381 $0.0000
Rengert 21,562 $0.0000
Bessemer Holdings, L.P. 124,669 $0.0000
</TABLE>
Page 62 of 67
<PAGE>
APPENDIX 3
IRB's and Mortgage Notes
------------------------
1. Agreement dated August 26, 1981, by, between and among Hudson
Community Development and Planning Agency, City of Hudson
Development Corporation, City of Hudson Industrial Development
Agency and W. B. McGuire Co., Inc. and Note dated December 15,
1981, between W.B. McGuire Co., Inc., as borrower, and The Hudson
Development Corporation, as lender.
2. Installment Note dated January 31, 1995, between BRF Door
Corporation, as borrower, and Overhead Door Co. of Boca Raton,
Inc., as lender.
3. Adjustable Rate Note dated May 31, 1986, between J. Michael Tiner
and Martha C. Tiner, as borrower, and Southside Savings and Loan
Association, as lender.
Page 63 of 67
<PAGE>
APPENDIX 4
<TABLE>
Anticipated Amounts Payable as a result of the
Redemption of the Preferred Shares
<CAPTION>
Shareholder Number of Redemption Total Amount
Preferred Price per Payable on
Shares Share Redemption
<S> <C> <C> <C>
Bessemer Holdings,
L.P 2,966,186 $10.00 29,661,860
Bessemer Holdings
Special Situations,
L.P 36,225 $10.00 362,250
ODI Partners, L.P. 362,249 $10.00 3,622,490
</TABLE>
Page 64 of 67
<PAGE>
APPENDIX 5
<TABLE>
<CAPTION>
Options/ Exercise Exercise
Warrants Price Proceeds
-------- ----- --------
<S> <C> <C> <C>
ODI 1990 Stock Plan:
Bolton 129,381 $0.0000 $0
Rengert 21,562 0.0000 0
Bessemer Holdings, L.P. 124,669 0.0000 0
------- -
Subtotal ODI 1990 Stock
Option Plan 275,612 0.0257 0
ODI Warrants Vested:
Bolton 530,265 0.0257 13,628
Simmons 100,469 0.0257 2,582
------- -----
Subtotal ODI Warrants Vested 630,734 18,210
ODI Options (Converted from
Warrants):
Simmons 110,471 10.0000 1,104,710
ODI 1994 Stock Option Plan:
Bolton 200,000 10.0000 2,000,000
Rengert 52,500 10.0000 525,000
Simmons 125,000 10.0000 1,250,000
Schochet 45,000 10.0000 450,000
Brum 100,000 10.0000 1,000,000
Macaulay 21,000 10.0000 210,000
Thompson 50,000 10.0000 500,000
Grunwald 400,000 10.0000 4,000,000
Venema 75,000 10.0000 750,000
Budd 125,000 10.0000 1,250,000
Haley 52,500 10.0000 525,000
Zilliox 52,500 10.0000 525,000
Horrigan 50,000 10.0000 500,000
------ -------
Subtotal ODI 1994 Stock 1,348,500 13,485,000
Option Plan
GMI Holdings, Inc. Rollover
Stock Option Plan:
Rubin 67,680 0.7300 49,406
Rubin 48,362 2.7600 133,479
Budd 91,860 1.3100 120,337
Horrigan 62,180 2.7600 171,617
------ -------
Subtotal GMI Holdings, Inc.
Rollover Stock Option Plan 270,082 474,839
Class B Warrants
CBC Capital Partners 883,774 0.0026 2,298
Warrants on Preferred Stock
Issuance:
Bessemer Holdings L.P. 2,644,712 10.0000 26,447,120
Bessemer Holdings Special
Situations, L.P. 32,299 10.0000 322,990
ODI Partners, L.P. 322,989 10.0000 3,229,890
------- ---------
Subtotal Warrants on
Preferred Stock Issuance 3,000,000 30,000,000
--------- ----------
Total 6,519,173 $ 6.9155 45,083,057
========= ======== ==========
</TABLE>
03:02 PM 28-JUN-96
Page 65 of 67
<PAGE>
<TABLE>
<CAPTION>
Aggregate
Payment
<S> <C>
ODI 1990 Stock Plan $ 5,710,893
ODI Warrants Vested 13,053,084
ODI Options (Converted from Warrants) 1,184,334
ODI 1994 Stock Option Plan 14,456,958
GMI Holdings, Inc. Rollover Stock Option Plan 5,121,468
Class B Warrants 18,310,180
Warrants on Preferred Stock Issuance 32,162,309
----------
Total $89,999,226
===========
</TABLE>
Page 66 of 67
<PAGE>
EXHIBIT 20
OVERHEAD DOOR INCORPORATED
CORPORATE NEWS
FOR RELEASE, JULY 18, 1996
--------------------------
CONTACT:
--------
Brian Bolton
214 233 6611
(Dallas, Texas, July 18, 1996) Overhead Door Incorporated said
Sanwa Shutter Corporation of Japan completed today its acquisition of
Overhead Door pursuant to their definitive agreement executed in June.
The total consideration paid or assumed was approximately $710
million, including $470 million in cash to acquire Overhead Door's
common stock, options, and warrants and to redeem its preferred stock.
Sanwa also caused Overhead Door to refinance its outstanding bank debt
of approximately $155 million including accrued interest. Overhead
Door's $85 million of 12.25% Unsecured Senior Notes due February 1,
2000, remained outstanding on the acquisition date. Noteholders have
the right to put their Notes to Overhead Door at a price of 101%
during a certain period following a change in control.
Overhead Door, headquartered in Dallas, is the leading integrated
door systems company in the United States. Formerly listed on the New
York Stock Exchange, the company, whose founder invented the modern
sectional garage door, was taken private in January, 1990 by Bessemer
Holdings, L.P., an investment partnership headquartered in New York,
and members of Overhead Door's management. In August, 1994, Overhead
Door acquired GMI Holdings, manufacturer of Genie brand electronic
garage door operators. The company also manufactures upward-acting
commercial and industrial doors and operators, automated pedestrian
entrances under the Horton Automatics name, truck doors under the
TODCO name, as well as Genie branded wet-dry vacuums, insulated panels
and McGuire loading dock equipment.
Sanwa Shutter, headquartered in Tokyo, is the leading door
systems company in Japan. It had a cross license agreement with
Overhead Door that expired in 1989.
Overhead Door's advisors in this matter were Morgan Stanley & Co.
Incorporated and Smith Barney Inc.
Page 67 of 67
