Exhibit 1
SECOND AMENDMENT TO
ASSET PURCHASE AGREEMENT
THIS SECOND AMENDMENT TO ASSET PURCHASE AGREEMENT (the "Second
Amendment"), dated as of January 22, 2001, is made by and among SHILOH
INDUSTRIES, INC., a Delaware corporation (the "Parent"), SHILOH AUTOMOTIVE,
INC., an Ohio corporation ("Buyer"), and MTD PRODUCTS INC, an Ohio corporation
("Seller").
RECITALS
--------
WHEREAS, the Parent, Buyer and Seller entered into a certain Asset
Purchase Agreement, dated as of June 21, 1999 (the "Purchase Agreement") for the
sale and purchase of substantially all of the assets of the unincorporated
automotive division of Seller; and
WHEREAS, the parties amended the Purchase Agreement by a First
Amendment to Asset Purchase Agreement, dated as of August 31, 1999; and
WHEREAS, the closing of the transaction contemplated under the
Purchase Agreement occurred effective as of November 1, 1999; and
WHEREAS, pursuant to Section 10.11 of the Purchase Agreement, the
parties hereto desire to further amend said Purchase Agreement as more fully set
forth herein; and
WHEREAS, the parties hereto acknowledge and agree that, after
obtaining and reviewing the financial results of the operations of the Division
and after making appropriate adjustments thereto, (i) the First Year EBITDA is
Ten Million Five Hundred Twenty-Two Thousand Six Hundred Ninety Six Dollars
($10,522,696.00) and (ii) according to Section 2.8 of the Purchase Agreement,
the Excess Earnout Amount is Eight Million Ninety Thousand Seven Hundred Eighty
Four Dollars ($8,090,784.00), which amount was calculated as follows: First Year
Earnout Amount less $8,500,000.00, or $2,022,696.00, multiplied by four (4); and
WHEREAS, the Earnout Amount is payable one-half (1/2) in shares of
Parent Common Stock in the amount of Two Hundred Eighty Eight Thousand Nine
Hundred Sixty (288,960) and one-half (1/2) in cash.
NOW, THEREFORE, in consideration of the promises and the mutual
covenants and agreements hereinafter set forth, the parties hereto, intending to
be legally bound hereby, covenant and agree as follows:
1. CERTAIN DEFINITIONS. Unless otherwise defined herein, all
capitalized terms used herein shall have the meanings given to them in the
Purchase Agreement.
2. EARNOUT. Notwithstanding any provision contained in Section 2.8
of the Purchase Agreement to the contrary, Buyer and Seller agree that with
respect to the payout of
one-half of the Earnout Amount, i.e., $4,045,392.00 in cash as provided by
Section 2.8 of the Purchase Agreement (the "Cash Earnout Amount"), Buyer shall
satisfy its obligations with respect to the Cash Earnout Amount by executing and
delivering to Seller the Cognovit Promissory Note, in substantially the form
attached hereto as Exhibit A (the "Note"). Buyer and Parent (as its interest may
appear) hereby waive their right to withhold and set-off against the Cash
Earnout Amount reflected in the Note the amount of any claim for indemnification
or payment of Losses or any amounts payable by Seller to Buyer as set forth in
Section 2.8(b)(iv) thereof, which such sub-paragraph (iv) shall be deemed to be
deleted from the Purchase Agreement in its entirety. All of the parties hereto
waive any rights to contest or object to the calculation of the Earnout Amount
as may be set forth in Section 2.8(d) of the Purchase Agreement, and hereby
release any claims or rights set forth therein.
3. COVENANT REGARDING CAPITAL EXPENDITURES. In consideration of the
amended Cash Earnout Amount payment terms and conditions set forth in Section 2
of this Second Amendment, and other good and valuable consideration, Parent,
Buyer and Seller hereby agree that Seller shall pay to Buyer by wire transfer
the amount of One Million Seven Hundred Forty Dollars ($1,000,740.00) to satisfy
and discharge in full all of Seller's obligations under Section 4.4(d) of the
Purchase Agreement. Such amount shall be payable upon execution and delivery of
this Second Amendment. Upon execution of this Second Amendment, except for the
payment of the amounts referenced in this Section 3, Seller shall have no
further or additional obligation or liability under Section 4.4(d) of the
Purchase Agreement, which shall be discharged and released in its entirety, and
shall be of no further force or effect.
4. EFFECT OF SECOND AMENDMENT. Except as specifically provided
herein, this Second Amendment does not in any way waive, amend, modify, affect
or impair the terms and conditions of the Purchase Agreement, and all terms and
conditions of the Purchase Agreement are to remain in full force and effect
unless otherwise specifically amended, waived or changed pursuant to this Second
Amendment.
5. ENTIRE AGREEMENT. This Second Amendment constitutes the entire
agreement among the parties pertaining to the subject matter hereof and
supersedes all prior and contemporaneous agreements, understandings,
representations, or other arrangements, whether express or implied, written or
oral, of the parties in connection therewith except to the extent expressly
incorporated or specifically referred to herein.
6. COUNTERPARTS. This Second Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed and delivered shall be deemed an original, but all
such counterparts together shall constitute but one and the same instrument.
7. GOVERNING LAW. THIS SECOND AMENDMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF OHIO, WITHOUT
GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAW.
2
IN WITNESS WHEREOF, each of the parties hereto has caused this
Second Amendment to be duly executed and delivered as of the date first above
written.
SHILOH INDUSTRIES, INC.
/s/ Xxxxx X. Xxxxx
By: Xxxxx X. Xxxxx
Its: Chief Financial Officer
SHILOH AUTOMOTIVE, INC.
/s/ Xxxxx X. Xxxxx
By: Xxxxx X. Xxxxx
Its: Treasurer
MTD PRODUCTS INC
/s/ Xxxxxx X. Xxxxxx
By: Xxxxxx X. Xxxxxx
Its: Executive Vice President and Chief Financial
Officer
3
