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HAZARDOUS SUBSTANCES INDEMNITY AGREEMENT
THIS HAZARDOUS SUBSTANCES INDEMNITY AGREEMENT (this "AGREEMENT") is made
as of the 30th day of June, 1998, by and between EDAC TECHNOLOGIES CORPORATION,
a Wisconsin corporation with its chief executive office and principal place of
business at 0000 Xxx Xxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxx 00000 (the
"BORROWER"), APEX MACHINE TOOL COMPANY, INC. F/K/A APEX ACQUISITION
CORPORATION, a Connecticut corporation with a mailing address c/o Borrower at
0000 Xxx Xxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxx 00000, and GROS-ITE
INDUSTRIES, INC., a Connecticut corporation with a mailing address c/o Borrower
at 0000 Xxx Xxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxx 00000 (collectively, the
"GUARANTORS"), and FLEET NATIONAL BANK, a national banking association with a
place of business at 000 Xxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000 (the
"LENDER"). Capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Loan Agreement as defined below.
R E C I T A L S:
WHEREAS, the Borrower and Lender hereto have entered into a certain Fifth
Amended and Restated Revolving Loan, Term Loan, Equipment Loan and Security
Agreement dated February 28, 1995, as amended from time to time and now in
effect (the "LOAN AGREEMENT") pursuant to which the Lender has extended certain
loans to the Borrower (the "LOANS"); and
WHEREAS, the Guarantors have guaranteed repayment of the Loans; and
WHEREAS, the Borrower operates and conducts business at 1790, 1794 and
0000 Xxx Xxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxx (the "BORROWER PROPERTY"); and
WHEREAS, Apex Machine Tool Company, Inc. f/k/a Apex Acquisition
Corporation operates and conducts business at 00 Xxxxxx Xxxx, Xxxxxxxxxx,
Xxxxxxxxxxx and owns or shall own 17, 21 and 00 Xxxxxx Xxxx, Xxxxxxxxxx,
Xxxxxxxxxxx (collectively, the "GUARANTOR PROPERTY" and collectively with the
Borrower Property, the "PROPERTY"); and
WHEREAS, the Lender has required, as a condition of entering into the
Loans, that the Borrower and Guarantors indemnify and hold the Lender harmless
against and from certain obligations for which the Lender may incur liability,
by reason of the threat or presence of any hazardous substance at or near the
Property;
NOW, THEREFORE, in consideration of the Lender's execution and delivery of
the Loan Documents and Ten Dollars ($10.00), and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the Borrower and Guarantors, intending to be legally bound, hereby agree as
follows:
1. RECITALS. The foregoing recitals are incorporated into this Agreement
by this reference.
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2. REPRESENTATIONS AND WARRANTIES. Borrower and Guarantors hereby
represent and warrant that except as set forth in (a) the environmental reports
set forth in Schedule 4.18 of a certain Purchase and Sale Agreement by and
among Guarantor, Apex Machine Tool Company, Inc., Xxxxxx X. Xxxxxx, Xxxxx X.
Xxxxxx and Xxxxxxx Xxxxxx, and (b) the environmental reports previously
provided to Lender (collectively, the "ENVIRONMENTAL REPORTS"):
a. No substances, including, without limitation, asbestos or any
substance containing asbestos and deemed hazardous under any Hazardous
Substances Law (as defined below), the group of organic compounds known as
polychlorinated biphenyls, flammable explosives, radioactive materials,
chemicals known to cause cancer or reproductive toxicity, pollutants, effluents,
contaminants, emissions or related materials and any items included in the
definition of hazardous or toxic waste, materials or substances ("HAZARDOUS
SUBSTANCES") under any law relating to environmental conditions and industrial
hygiene, including, without limitation, the Resource Conservation and Recovery
Act of 1976 ("RCRA"), 42 U.S.C. Section 6901 et seq., the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), 42
U.S.C. Section 9601 et seq., the Hazardous Materials Transportation Act, 49
U.S.C. Section 6901 et seq., the Federal Water Pollution Control Act, 33 U.S.C.
Section 1251 et seq., the Clean Air Act, 42 U.S.C. Section 741 et seq., the
Clean Water Act, 33 U.S.C. Section 7401, et seq., the Toxic Substances Control
Act, 15 U.S.C. Section 2601 et seq., the Safe Drinking Water Act, 42 U.S.C.
Section 300f et seq., Title 22a of the Connecticut General Statutes, the
environmental laws of Indiana, California, Florida, Nevada and all other states
in which the Borrower conducts business, as the same may be amended from time to
time, and all other applicable federal, state and local environmental laws,
statutes, ordinances and the regulations, orders and decrees now or hereafter
promulgated thereunder (individually, a "HAZARDOUS SUBSTANCES LAW", and
collectively, the "HAZARDOUS SUBSTANCES LAWS"), have been or are or shall be,
installed, used, generated, manufactured, treated, handled, refined, produced,
processed, stored, disposed of, spilled, discharged, released or otherwise
deposited or located in, on or under the Property;
b. No activity has been or shall be, undertaken on the Property which
has caused or would cause (i) the Property to become a hazardous waste
treatment, storage or disposal facility or "establishment" as such terminology
is defined and classified under any Hazardous Substances Law, (ii) a release or
threatened release of any Hazardous Substance from the Property in violation of
any Hazardous Substances Law, or (iii) the discharge of any Hazardous Substance
into the atmosphere or into any watercourse, body of or surface or subsurface
water or wetland which would require a permit under any Hazardous Substances Law
and for which no such permit has been issued;
c. No activity has been undertaken or permitted to be undertaken on
the Property which would result in a violation under any Hazardous Substances
Law;
d. Neither the Borrower, Guarantors, any tenant or other occupant of
the Property nor any other party has, caused or suffered to occur, and the
Borrower and Guarantors will not hereafter cause or suffer to occur, a
discharge, spillage, uncontrolled loss, seepage or filtration of oil or
petroleum or chemical liquids or solid, liquid or gaseous products or hazardous
waste (a "SPILL"), as those terms are used in Chapter 446K of the Connecticut
General Statutes, as the same may be amended from time to time, at, upon, under
or within the Property, and neither the Borrower,
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Guarantors, any tenant or other occupant of the Property or any other party, has
been or is or will be, involved in operations at the Property, nor are there or
will there be any substances or conditions in or on the Property, which could
support a claim or cause of action or lead to the imposition on the Borrower, or
any other owner or operator of the Property of liability or the creation of a
lien on the Property under any Hazardous Substances Law.
3. COVENANTS.
a. The Borrower and Guarantors shall comply strictly and in all
respects with the requirements of the Hazardous Substances Laws and with all
similar laws and regulations and shall notify the Lender immediately in the
event of any discharge or discovery of any Hazardous Substance at, upon, under
or within the Property. The Borrower and Guarantors shall promptly forward to
the Lender copies of all orders, notices, permits, applications, correspondence
or other communications and reports received by the Borrower from, or sent to
the Borrower by the Connecticut Department of Environmental Protection ("DEP"),
the United States Environmental Protection Agency ("EPA") or any similar entity
in connection with any discharge, or the presence of any Hazardous Substance or
any other matters relating to the Hazardous Substances Laws or any similar laws
or regulations, as they may affect the Property. Upon request, the Borrower
shall provide the Lender with copies of all records, forms and other documents
that the Borrower is required to produce or maintain pursuant to any Hazardous
Substances Law or any permit.
b. The Borrower and Guarantors shall comply strictly and in all
respects with the requirements of any order issued by EPA, DEP or any other
federal, state or municipal department or agency having regulatory authority
over environmental matters with regard to the Property. If the Borrower or
Guarantors undertake any action to remedy any violation or potential violation
of any Hazardous Substances Law, they shall obtain and deliver to the Lender
certifications of engineers or other professionals acceptable to the Lender, in
form and substance satisfactory to the Lender, certifying that all necessary and
required actions to clean up, remove, contain, prevent and eliminate all
releases or threats of release of Hazardous Substances on or about the Property
to the levels required by the appropriate governmental agencies have been taken,
and that upon completion of such action, the Property is, to the knowledge of
such professional, then in compliance with applicable Hazardous Substances Laws
as then in effect and applicable to such actions.
c. The Borrower's and Guarantors' obligations under this Agreement
shall arise upon the execution of this Agreement and continue after the
discovery of the presence of any Hazardous Substance, whether or not EPA, DEP,
any other federal agency or any state or local environmental agency has taken or
threatened any action in connection with the presence of any Hazardous
Substance.
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4. INDEMNITY.
a. The Borrower and Guarantors shall at all times indemnify and hold
the Lender harmless against and from any and all claims, suits, actions, debts,
damages, costs, losses, liabilities, obligations, judgments, charges, and
expenses, of any nature whatsoever suffered, incurred or paid by the Lender,
under or on account of the Hazardous Substances Laws or any similar laws or
regulations, including the assertion of any lien thereunder, with respect to:
(i) any discharge of any Hazardous Substance, the threat of a
discharge of any Hazardous Substance, or the presence of any
Hazardous Substance at or affecting the Property, whether or not
the same originates or emanates from the Property, including any
loss of value of any of the Property as a result of any of the
foregoing;
(ii) any costs of removal or remedial action incurred by the
United States Government, the State of Connecticut, or the Lender,
or any costs incurred by any other person or damages from injury
to, destruction of, or loss of natural resources, including
reasonable costs of assessing such injury, destruction or loss
incurred pursuant to any Hazardous Substances Laws;
(iii) liability for personal injury or property damage arising
under any statutory or common law tort theory, including, without
limitation, damages assessed for the maintenance of a public or
private nuisance or for the carrying on of an abnormally dangerous
activity at or near the Property;
(iv) any other environmental matter affecting the Property within
the jurisdiction of EPA, DEP, any other federal agency, or any
state or local environmental agency;
(v) any failure by the Borrower or Guarantors to comply with the
terms of any order issued by EPA, DEP, or any other federal, state
or municipal department or agency having regulatory authority over
environmental matters with regard to the Property (an "ORDER");
and/or
(vi) the breach of any warranty, covenant or representation by
the Borrower or Guarantors relating to environmental matters as
set forth herein or any other documents relating to the Loan.
b. In the event the Borrower or Guarantors shall fail to comply with
any of the requirements of the Hazardous Substances Laws or any other
environmental law or regulation, or of any Order, the Lender may at its
election, but without the obligation so to do, at any time and from time to
time, give such notices and/or cause such work to be performed at the Property
and/or take any and all other actions as the Lender shall deem necessary or
advisable in order to cure the Borrower's or Guarantors' noncompliance with the
Hazardous Substances Laws or any Order. The Lender may also, at any time and
from time to time (but not more often than once per year unless an
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Event of Default shall have occurred and be continuing or a Spill or other
material violation of any Hazardous Substances Law shall have occurred) cause to
be conducted and completed by engineers, consultants and others selected by the
Lender, such investigations, studies, sampling and testing of the condition of
the Property and the compliance by the Borrower and all occupants of the
Property with the Hazardous Substance Laws as the Lender, in its sole
discretion, shall deem reasonably appropriate. All such investigations,
studies, sampling and testing shall, if an Event of Default shall have occurred
and be continuing or if a Spill or other material violation of any Hazardous
Substances Law shall have occurred, be at the Borrower's and Guarantors'
expense. The Borrower and Guarantors agree to cooperate with the Lender and all
persons retained by the Lender to conduct such investigations and to provide
them with access to the Property and the books and records of the Borrower and
Guarantors.
5. ATTORNEY'S FEES. If the Lender, or any of its authorized agents,
employees or representatives retains the services of any attorney in connection
with the enforcement of any of the provisions of, or the undertaking by the
Lender of any obligation under, this Agreement, the Borrower and Guarantors
shall pay the Lender's costs and reasonable attorneys' fees thereby incurred.
The Lender may employ an attorney of the Lender's own choice.
6. INTEREST. If the Lender incurs any obligations, costs or expenses
under this Agreement, such costs or expenses shall be deemed to be Obligations.
The Borrower and Guarantors shall pay the Lender such Obligations immediately,
on demand. If such payment is not received within fifteen (15) days after
demand thereof, interest on such amount shall, after the expiration of such
15-day period, accrue at the Default Rate of interest, until such amount is
paid in full.
7. JOINT AND SEVERAL LIABILITY. The Borrower's and Guarantors' liability
for any obligations arising under this Agreement is joint and several with any
other person now or hereafter obligated under this Agreement. Separate actions
may be brought and prosecuted against any of the entities which comprise the
Borrower, whether or not such action is brought against any of the other
entities or any other person or whether or not any other person is joined in
such action.
8. CONSENT TO JURISDICTION. The Borrower and Guarantors consent to the
exercise of personal jurisdiction over it by any federal or state court in the
State of Connecticut and consent to the selection of venue in any jurisdiction
or locality in the State of Connecticut. Service shall be effected by any
means permitted by the court in which any action is filed or, at the Lender's
option, by mailing process, postage prepaid, by certified mail, return receipt
requested, to the Borrower's and Guarantors' agent at the foregoing address or
to the Borrower and Guarantors at the address hereinafter set forth. Service
shall be deemed effective upon receipt. The Borrower and Guarantors may
designate a change of address of such agent by written notice to the Lender by
certified mail, return receipt requested, at least ten (10) days before such
change of address is to become effective.
9. NOTICE. All notices, demands, requests and other communications
required hereunder shall be in writing and shall be deemed to have been
properly given if personally delivered or sent by United States certified or
registered mail, return receipt requested, postage prepaid, addressed to the
party for whom it is intended at its address hereinafter set forth:
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If to the Borrower or Guarantors:
EDAC Technologies Corporation
0000 Xxx Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxxxx, Vice President
If to the Lender:
Fleet National Bank
000 Xxxx Xxxxxx - XXXX 0000
Xxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxx, Vice President
Notice shall be deemed given upon receipt. Any party may designate a change of
address by written notice to the others given at least ten (10) days before
such change of address is to become effective.
10. NO WAIVER. The Borrower and Guarantors waive any right to require the
Lender at any time to pursue any remedy in the Lender's power whatsoever. The
failure of the Lender to insist upon strict compliance with any of the terms
hereof shall not be considered to be a waiver of any such terms, and it shall
not prevent the Lender from insisting upon strict compliance with this
Agreement or any of the Loan Documents at any time thereafter.
11. SURVIVABILITY. The agreement to indemnify and hold harmless under
this Agreement will survive the repayment of the Loan and the discharge and
release of any other Loan Documents.
12. SEVERABILITY. If any clause or provision herein contained operates or
would prospectively operate to invalidate this Agreement in whole or in part,
then such clause or provision shall be void and treated as if not contained
herein, and the remainder of this Agreement shall remain operative and in full
force and effect.
13. INCONSISTENCIES AMONG THE LOAN DOCUMENTS. Nothing contained herein is
intended to modify in any way the obligations of the Borrower and Guarantors to
Lender under any of the Loan Documents. Any inconsistencies among the Loan
Documents shall be construed, interpreted and resolved so as to benefit the
Lender, and without regard to, and with no negative inference attached to,
whether this Agreement was drafted by the Lender or its attorneys.
14. ADDITIONAL DOCUMENTS. The Borrower shall from time to time, upon the
request of the Lender, execute and deliver any necessary or desirable further
documents or modifications or amendments hereto in confirmation of or with
respect to the indemnification provided for herein.
15. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
Borrower's and Guarantors' successors and assigns and shall inure to the
benefit of the Lender and its successors and assigns.
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16. CONTROLLING LAWS. This Agreement shall be governed by and construed
in accordance with the laws of the State of Connecticut.
IN WITNESS WHEREOF, the Borrower has caused this Agreement to be executed
as of the date first above written.
BORROWER:
EDAC TECHNOLOGIES CORP.
By: /s/ Xxxxxx X. Popolozio
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Xxxxxx Xxxxxxxxx
Its Vice President-Finance
Duly Authorized
GUARANTORS:
APEX MACHINE TOOL COMPANY, INC. f/k/a
APEX ACQUISITION CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
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Its Vice President
GROS-ITE INDUSTRIES, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
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Its Secretary
LENDER:
FLEET NATIONAL BANK
By: /s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx
Its Vice President
Duly Authorized
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