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EXHIBIT II
AMENDMENT NO. 2
TO
ASSET PURCHASE AGREEMENT
THIS AMENDMENT NO. 2 is dated May 31, 2001 with retroactive effect to
February 7, 2001 (this "Amendment No. 2") by and among PITT-DES MOINES, INC., a
Pennsylvania corporation ("Seller"), CHICAGO BRIDGE & IRON COMPANY N.V., a
Netherlands company ("CB&I"), and CB&I CONSTRUCTORS, INC., a Texas corporation
("CB&I Sub," and collectively with CB&I, "Purchaser").
RECITALS
A. Seller and Purchaser entered into that certain Asset Purchase
Agreement dated as of February 7, 2001, as amended by Amendment No. 1 thereto
dated March 7, 2001 (the "Asset Purchase Agreement").
B. The parties desire to further amend the Asset Purchase Agreement
upon the terms and conditions set forth herein with retroactive effect to
February 7, 2001.
NOW, THEREFORE, in consideration of the mutual promises and covenants
set forth in this Amendment No. 2, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound, agree as follows:
1. Definitions. Unless specifically defined herein, each capitalized
term used herein which is defined in the Asset Purchase Agreement shall have the
meaning assigned to such term in the Asset Purchase Agreement. The following
definitions are restated or added in alphabetical order in Section 1.1 of the
Asset Purchase Agreement:
"Contracts" has the meaning specified in Section 2.1.4 and shall
include the PDM Venezuela Contracts.
"PDM Venezuela" means Construcciones PDM, Venezuela, C.A., a
Venezuelan corporation.
"PDM Venezuela Assets" has the meaning specified in Section 2.1.16.
"PDM Venezuela Contracts" has the meaning specified in Section
2.1.16.
"Retained Excluded Accounts Receivable" means $1,454,344 of
collected Excluded Accounts Receivable designated by Seller and
Purchaser as Excluded Assets as of May 31, 2001.
2. Certain Interpretive Matters. Section 1.2 of the Asset Purchase
Agreement is hereby amended by inserting the following sentence at the end of
Section 1.2:
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"The Assets, Excluded Assets, Assumed Liabilities and Excluded
Liabilities that relate to PDM Venezuela subject to this Agreement
are described solely in Section 2.1.16, Section 2.2.9, Section
4.1(i) and Section 4.2(j), respectively."
3. Purchase and Sale of Assets. Section 2.1 of the Asset Purchase
Agreement is hereby amended by (i) deleting the phrase "the Significant
Subsidiaries" in subsection 2.1.13 and substituting therefor "Hycon, Inc.", and
(ii) inserting a new Section 2.1.16 at the end of Section 2.1 reading as
follows:
"2.1.16. PDM Venezuela. The following assets relating to PDM
Venezuela: (a) machinery and equipment (including field equipment,
office furniture and equipment, and computers); (b) inventories
(including raw materials and work-in-process); (c) contract rights
relating to the customer project contracts and the warehouse lease
listed on Schedule 2.1.16(a) (the "PDM Venezuela Contracts"); (d)
the accounts receivable listed on Schedule 2.1.16(b); and (e) cash
on hand in the amount of $557,098. Such assets shall be referred to
in this Agreement as the "PDM Venezuela Assets" and shall be deemed
part of the Assets for purposes of this Agreement."
4. Excluded Assets. (a) Section 2.2.1(b) of the Asset Purchase
Agreement is hereby amended and restated to read in its entirety as follows:
"(b) cash in certain foreign bank accounts not exceeding $580,482 in
aggregate amount."
(b) Section 2.2.3(b) of the Asset Purchase Agreement is hereby
amended and restated to read in its entirety as follows:
"(b) the construction contracts of Seller's Engineered Construction
Division relating to (i) the Enron LNG Project, (ii) the Tampa Sea-3
Project, (iii) the Panama Refineria project in Colon, Panama
(#48070), (iv) the X.X. Xxxxxx Co. project in Reidsville, NC
(#49055), (v) the Northwestern Mechanical project in Xxxxx Creek, TX
(#48206), (vi) the Fina Oil and Chemical Co. project in Port Xxxxxx,
TX (#49002), and (vii) subject to Section 2.3.2(b) below, the
Contracts listed in subsection (a) of Section 5.1.12 of the PDM
Disclosure Schedule other than those Contracts listed or described
in Schedule 2.2.3 (such Contracts listed in Schedule 2.2.3 to be
included in the Assets); and"
(b) Section 2.2 of the Asset Purchase Agreement is hereby amended by
inserting a new Section 2.2.9 at the end of Section 2.2 reading as follows:
"2.2.9. PDM Venezuela. The following assets relating to PDM
Venezuela: (a) prepaid taxes, (b) patents, (c) building and
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leasehold improvements, (d) goodwill and (e) miscellaneous assets
(including guaranty deposits and deferred charges)."
5. Purchase Price Adjustment. (a) Section 3.2(a) of the Asset Purchase
Agreement is hereby amended by deleting the phrase "April 15, 2001" in the
second line thereof and substituting therefor " May 8, 2001".
(b) Section 3.2(a)(2) of the Asset Purchase Agreement is hereby amended
and restated to read in its entirety as follows:
" (2) if the Adjusted Net Working Capital of the Divisions as
so calculated is less than the Target Adjusted Net Working Capital
of the Divisions, the Cash Amount shall be decreased by the
difference between such Adjusted Net Working Capital of the
Divisions and the Target Adjusted Net Working Capital of the
Divisions, and Seller shall pay Purchaser cash in an amount equal to
such difference."
6. Excluded Accounts Receivable. The parties agree that the treatment
of the accounts receivable (including certain unbilled retainage) described in
Section 2.2.2 of the PDM Disclosure Schedule, heretofore referred to in the
Asset Purchase Agreement as "Excluded Accounts Receivable", shall be modified
such that such accounts receivable (other than the Retained Excluded Accounts
Receivable) shall instead be considered "Assets" rather than "Excluded Assets"
and shall therefore be the sole and exclusive property of Purchaser. Toward that
end, as of May 31, 2001, (i) the provisions of Section 3.3 of the Asset Purchase
Agreement (and the defined term "Excluded Accounts Receivable") shall be
terminated and inoperative, and Section 2.2.2(a) shall be amended in its
entirety to read "Retained Excluded Accounts Receivable", (ii) any amounts
previously remitted by Purchaser to Seller with respect to such formerly treated
"Excluded Accounts Receivable" (other than the Retained Excluded Accounts
Receivable) shall be returned to Purchaser (or credited to Purchaser in
connection with the Purchase Price Adjustment provided in Section 3.2 of the
Asset Purchase Agreement), and (iii) any proceeds or amounts heretofore or
hereafter collected by Purchaser with respect to such formerly treated "Excluded
Accounts Receivable" (other than the Retained Excluded Accounts Receivable)
shall be retained by Purchaser as its sole and exclusive property.
7. Assumed Liabilities. Section 4.1 of the Asset Purchase Agreement is
hereby amended by (i) deleting the word "and" at the end of Section 4.1(g), (ii)
substituting "; and" for the period at the end of Section 4.1(h), and (iii)
inserting a new Section 4.1(i) at the end of Section 4.1 reading as follows:
"(i) The following liabilities, and only the following
liabilities, relating to PDM Venezuela: (i) liabilities and
obligations relating to the PDM Venezuela Contracts and (ii) the
accounts payable listed on Schedule 2.1.16(c)."
8. Excluded Liabilities. Section 4.2 of the Asset Purchase Agreement is
hereby amended by (i) deleting the word "and" at the end of Section 4.2(h), (ii)
substituting "; and"
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for the period at the end of Section 4.2(i), and (iii)
inserting a new Section 4.2(j) at the end of Section 4.2 reading as follows:
"(j) All liabilities and obligations arising out of or relating
to the business or operations of PDM Venezuela at or for any period
of time (including the period of time from February 7, 2001 to May
31, 2001), including, but not limited to, the following: (i) accrued
taxes, (ii) indebtedness, and (iii) payroll, tax and other
obligations relating to PDM Venezuela employees and terminated
employees, other than obligations relating to former employees of
PDM Venezuela whom Purchaser in its sole discretion determines to
employ."
9. Certain Tax Matters. Section 7.4(a) of the Asset Purchase Agreement
is hereby amended to insert the following clause at the end of Section 7.4(a):
"; provided, however, that all transfer, sales, value added (VAT),
excise and other similar taxes and recording and filing fees
pertaining to the transfer of the PDM Venezuela Assets (and any
retransfer of the stock of PDM Venezuela) shall be paid by Seller."
10. Expenses. Section 9.2 of the Asset Purchase Agreement is hereby
amended to insert the following clause at the end of Section 9.2:
"; provided, however, that Seller will pay the reasonable fees and
disbursements of Purchaser's local Venezuela counsel, Xxxxxx, Xxxxx
Xxxxx, Antkly & Xxxxx, incurred in connection with the preparation
for, and consummation of, the transfer of the PDM Venezuela Assets
(and any retransfer of the stock of PDM Venezuela)."
11. Passage of Title and Risk of Loss. Section 9.10 of the Asset
Purchase Agreement is hereby amended and restated to read in its entirety as
follows:
" Legal title, equitable title and risk of loss with respect to the
Assets will not pass to Purchaser until the Assets are Transferred
at the Closing, which Transfer, once it has occurred, will be deemed
effective for Tax, accounting and other computational purposes as of
11:59 p.m. (Central Time) on December 31, 2000 (the "Effective
Time"); provided, however, that Transfer of the PDM Venezuela Assets
will be deemed effective as of 1:00 p.m. (Central Time) on February
7, 2001. Notwithstanding any other provision of this Agreement to
the contrary, from and after the Effective Time through February 9,
2001, any revenue or income received or recognized by Seller with
respect to the Divisions (other than with respect to PDM Venezuela)
shall be for the benefit of, and be paid to, Purchaser, and any cost
or expense paid or incurred by Seller
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with respect to the Divisions (other than with respect to PDM
Venezuela) shall be for the account of, and be reimbursed by,
Purchaser. Within a reasonable period after the Closing Date (and in
no event later than May 31, 2001), Purchaser shall prepare and
present a statement to Seller setting forth a calculation of (i) all
moneys loaned, advanced or paid by Seller to, or for the benefit of,
the Divisions (other than to or for the benefit of PDM Venezuela)
from and after the Effective Time through February 9, 2001, (ii) all
moneys loaned, advanced, dividended, paid or applied by or from the
Divisions (other than by or from PDM Venezuela) to, or for the
benefit of, the Seller (excluding the Divisions) or any Affiliate of
Seller (including, but not limited to, any amounts so paid or
applied relating to any Excluded Liability, corporate overhead
charge or other corporate allocation) from and after the Effective
Time through February 9, 2001, and (iii) any net funds paid,
contributed or advanced to PDM Venezuela by Purchaser from February
7, 2001 through May 31, 2001 not previously accrued as a deduction
to working capital on the Audited Final Balance Sheet or not
previously paid or reimbursed to Purchaser by Seller, together with
such documentation as is reasonably necessary to support such
calculations. The net difference between the total amount shown in
(i), on the one hand, and the aggregate amount shown in (ii) and
(iii), on the other hand, shall be paid by Seller or Purchaser, as
the case may be, at the time of the Purchase Price adjustment
provided in Section 3.2."
12. Rescission of Stock Transfer; Waiver. (a) Immediately prior to the
consummation of the transfer of the PDM Venezuela Assets by Seller to Purchaser,
and the assumption by Purchaser of the liabilities described in Section 4.1(i)
of the Asset Purchase Agreement, Purchaser shall transfer and return to Seller
the outstanding capital stock of PDM Venezuela (all such transactions
hereinafter collectively referred to as the "PDM Venezuela Transactions"). In
connection with such transfer to Seller of the capital stock of PDM Venezuela,
Purchaser makes no representation or warranty to Seller other than the
representation and warranty that Purchaser has imposed no lien, pledge or
encumbrance on such capital stock during any deemed ownership thereof. The
transaction by which such capital stock was originally transferred by Seller to
Purchaser shall be treated as rescinded on the books and records (stock
register) of PDM Venezuela.
(b) Purchaser on its behalf and on behalf of all other Purchaser
Indemnitees hereby waives any and all indemnification and other claims against
Seller pursuant to Sections 3.2 or 8.2(a)(i) of the Asset Purchase Agreement or
otherwise based on or relating to any discrepancy in numbers between (i) the
December 31, 2000 PDM Venezuela balance sheet marked "At Closing" attached to
Schedule 2.1.16, which financial data was included in the Financial Statements
originally delivered by Seller to Purchaser at Closing on February 7, 2001 and
referred to in Section 5.1.4(c) of the Asset Purchase Agreement, and (ii) the
December 31, 2000 PDM Venezuela balance sheet marked "Revised" attached to
Schedule 2.1.16, which revised
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financial data has been delivered by Seller to Purchaser prior to the execution
of this Amendment No. 2.
13. Purchase Option. At any time subsequent to November 30, 2001 and on
or prior to November 30, 2002, Purchaser shall have the right to acquire all the
outstanding capital stock of PDM Venezuela from Seller at a purchase price equal
to $1,000 (One Thousand Dollars). Purchaser shall notify Seller in writing of
its election to exercise such purchase option and the date estimated for
consummation of such purchase (not less than five nor more than 45 days after
the date of such notice, but in any event not later than November 30, 2002).
14. Counterparts; Effectiveness. This Amendment No. 2 may be executed
in counterparts, each of which when so executed being deemed an original and all
of which taken together constituting one and the same agreement. This Amendment
No. 2 (other than paragraph 6) and the PDM Venezuela Transactions being
consummated in connection with the execution hereof shall be retroactively
effective to February 7, 2001 (including for accounting and financial reporting
purposes).
15. Effect of Amendment. Except as expressly set forth herein, all
terms and conditions of the Asset Purchase Agreement shall remain unchanged and
in full force and effect.
16. Governing Law. This Amendment No. 2 shall be governed by and
construed in accordance with the substantive laws of the State of Illinois,
without giving effect to the principles of conflicts of laws thereof.
[signature page follows]
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IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed as of the day and year first above written.
PITT-DES MOINES, INC.
By: /s/ X. X. Xxxxx
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Name: X. X. Xxxxx
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Title: VICE PRESIDENT FINANCE & TREASURER
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CHICAGO BRIDGE & IRON COMPANY N.V.
By: CHICAGO BRIDGE & IRON COMPANY
B.V., its Managing Director
By: /s/ X. X. Xxxxxxx
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Name: X. X. Xxxxxxx
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Title:
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CB&I CONSTRUCTORS, INC.
By: /s/ X. X. Xxxxxxx
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Name: X. X. Xxxxxxx
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Title:
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ACCEPTED AND AGREED:
PDM LATIN AMERICA, LTD.
By: /s/ X. X. Xxxxx
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Name: X. X. Xxxxx
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Title: VICE PRESIDENT FINANCE & TREASURER
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