AMENDMENT NO. 1 TO STOCK PURCHASE AGREEMENT
This Amendment No. 1 to the Stock Purchase Agreement, dated November 26,
1996 (the "Stock Purchase Agreement"), by and among IMCO Recycling Inc., a
Delaware corporation ("Purchaser"), IMSAMET, Inc., a Delaware corporation
("IMSAMET"), and EnviroSource, Inc., a Delaware corporation ("Seller"), is made
by and among Purchaser, IMSAMET and Seller as of the 21st day of January, 1997.
Capitalized terms used but not defined herein have the meanings ascribed to
them in the Stock Purchase Agreement.
W I T N E S S E T H
WHEREAS, Purchaser, IMSAMET and Seller have entered into the Stock
Purchase Agreement;
WHEREAS, the closing of the transactions contemplated by the Stock
Purchase Agreement will occur today, January 21, 1997 (the "Closing Date");
WHEREAS, the parties to the Stock Purchase Agreement desire to make the
purchase and sale of the Shares contemplated by the Stock Purchase Agreement
effective as of January 1, 1997;
WHEREAS, Seller is willing to indemnify Purchaser against certain
liabilities under the Multiemployer Pension Plan Amendments of 1980 ("MPPAA");
WHEREAS, the parties to the Stock Purchase Agreement wish to amend certain
environmental-related provisions of the Stock Purchase Agreement; and
WHEREAS, the parties to the Stock Purchase Agreement wish to memorialize
certain agreements and arrangements among them in connection with the
conditions set forth in Section 5.01(c) and 5.02(c) of the Stock Purchase
Agreement and certain tax-related elections;
NOW, THEREFORE, Purchaser, IMSAMET and Seller hereby agree as follows:
A. EFFECTIVE DATE OF PURCHASE AND SALE
1. The purchase and sale of the Shares contemplated by the
Stock Purchase Agreement shall be effective as of January 1, 1997 and
Purchaser shall be entitled to all profits and losses of IMSAMET on
and after January 1, 1997.
2. The definition in Article I of the Stock Purchase Agreement "Closing
Balance Sheet" is hereby amended by deleting from the first sentence
thereof the terms "the day before the Closing Date" and inserting in
lieu thereof the terms "December 31, 1996".
3. In addition to the Adjustment of the Purchase Price pursuant to
Section 2.02 of the Stock Purchase Agreement, there shall be the
following further adjustment:
(a) To the extent that any payment or distribution of cash is
made by IMSAMET to Seller or any subsidiary of Seller other than
the Companies or SALTS during the period commencing on January 1,
1997 and ending on the Closing Date (the "Interim Period"), the
Purchase Price shall be reduced by such amount.
(b) To the extent that any payment or distribution of cash is
made by Seller or any subsidiary of Seller other than the
Companies or SALTS to IMSAMET during the Interim Period, the
Purchase Price shall be increased by such amount.
Such an addition or subtraction from the Purchase Price shall be
made a part of the Closing Adjustment procedure contemplated by
Section 2.02 of the Stock Purchase Agreement.
B. MPPAA INDEMNIFICATION
4. Article I of the Stock Purchase Agreement is hereby amended by adding
the following definition (in the appropriate alphabetical position):
"'MPPAA CLAIMS' means any and all Losses directly
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or indirectly incurred, suffered, sustained or required to be
paid by, or sought to be imposed upon Purchaser, including
Purchaser's share of Losses incurred, suffered, sustained or
required to be paid by, or sought to be imposed upon any of
Purchaser's Indemnified Persons, resulting from, relating to or
arising out of claims based on liabilities under the
Multiemployer Pension Plan Amendments of 1980 of P-I-E
Nationwide, Inc. (a former subsidiary of a corporation acquired
by Seller)."
5. Section 7.01(a) of the Stock Purchase Agreement is hereby amended by:
(i) deleting the word "and" at the end of Section 7.01(a)(5), (ii)
deleting the period and adding ", and" at the end of Section
7.01(a)(6), (iii) adding the following new clause (7) at the end of
Section 7.01(a):
"(7) any MPPAA Claims."
6. Section 7.01(b)(3) is hereby amended by deleting it in its entirety
and by replacing it with the following:
"(3) 'NON-ENVIRONMENTAL CLAIMS' means claims for indemnification
under: (i) clause (1) of Section 7.01(a), except to the extent
that such claims relate to breaches of Section 3.01(k), (ii)
clause (2) of Section 7.01(a), and (iii) clause (7) of Section
7.01(a). Non-Environmental Claims shall not be payable in any
event with respect to Losses directly or indirectly incurred by
Purchaser that do not exceed in the aggregate (x) $500,000 LESS
(y) one-half of the Initial Environmental Liability."
7. Section 7.01(b)(5) is hereby amended by deleting it in its entirety
and by replacing it with the following:
"(5) (A) Seller's liability for claims under this Section 7.01
(except to the extent that such claims relate to breaches of
Section 3.01(o) and 3.01(p) hereof) shall not exceed $17,500,000
(as
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adjusted pursuant to Section 5.01(m)), (B) Seller's liability
for claims under this Section 7.01 relating to breaches of
Section 3.01(o) and 3.01(p) hereof shall not exceed the Purchase
Price (as adjusted pursuant to Section 2.02), and (C) Seller's
liability for claims under this Section 7.01 relating to MPPAA
Claims shall not exceed the Purchase Price (as adjusted pursuant
to Section 2.02); provided, however, that in no event shall
Seller's liability for claims (of any description) under this
Section 7.01 exceed the Purchase Price (as adjusted pursuant to
Section 2.02)."
8. Section 7.05(b) is hereby amended by deleting the penultimate
sentence thereof in its entirety and replacing it with the following:
"All other covenants and agreements contained in or made pursuant
to this Agreement (including Section 7.01 and 7.02) shall survive
the Closing for so long as any claim may be made in respect of
such matters under any applicable statute of limitations, except
that (i) Sections 7.01(a)(4) and (5) shall survive the Closing
until (but excluding) the tenth anniversary of the Closing Date
(subject to Section 7.01(b)(4) hereof) and (ii) Section
7.01(a)(7) shall survive the Closing until (but excluding) the
sixth anniversary of the Closing Date."
9. The Seller agrees that, in connection with any release of the
Seller and/or any of its subsidiaries by any multi-employer plan (or
any trustee or union sponsor thereof) from any actual or potential
claims based on liabilities under MPPAA of P-I-E Nationwide, Inc., it
will use its best efforts to include the Companies (without naming
them specifically in such release).
E. SECTION 338(h)(10) ELECTION
10. From and after the date hereof, the Purchaser and the Seller will
negotiate in good faith in order to reach a
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mutually acceptable agreement or arrangement as to whether or not
the Purchaser and/or the Seller (as appropriate) shall make an
election contemplated by Section 338(h)(10) of the Code in connection
with the Purchase and Sale.
F. ENVIRONMENTAL-RELATED AMENDMENTS
11. The last sentence of Section 3.01(k) of the Stock Purchase Agreement
is hereby amended by adding thereto, immediately after the terms
"breaches of this Section 3.01(k)" and immediately before the comma
(",") that appears immediately thereafter, the following:
"(disregarding for the purpose of this definition only, all the terms
appearing after the comma in the first sentence of this Section
3.01(k))".
X. XXXXXXX SETTLEMENT AGREEMENT
11. The Seller and the Purchaser hereby acknowledge that the Agreement,
dated January 16, 1997 by and among Xxxx Xxxxxxx, Xxxx Xxxxxxx, Magna
Aluminum Refining Inc., the Seller and the Purchaser serves to settle
the matter disclosed on (updated) Schedule 3.01(g) of the Disclosure
Schedule. As a result of the foregoing (as well as other relevant
facts and circumstances), the Purchaser acknowledges that Section
5.01(c) of the
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Stock Purchase Agreement is satisfied and the Seller acknowledges
that Section 5.02(c) of the Stock Purchase Agreement is satisfied.
IN WITNESS WHEREOF, the undersigned have executed this Amendment No. 1 to
the Stock Purchase Agreement as of January 21, 1997.
ENVIROSOURCE, INC.
By: /s/ XXXXXX X. XXXXXXX
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Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
IMSAMET, INC.
By: /s/ XXXXXX X. XXXXXXX
------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
IMCO RECYCLING INC.
By: /s/ XXXXX X. XXXXXXXXX
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Name: Xxxxx X. Xxxxxxxxx
Title: President and CEO
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