AMENDMENT TO
ASSET PURCHASE AGREEMENT
This Amendment to the Asset Purchase Agreement entered into as of
October 31, 1997 (the "Purchase Agreement") by and among Recycling Industries of
Wisconsin, Inc., Recycling Industries, Inc., Xxxxxxxx Brothers Company, and
Milwaukee Metal Briquetting Co., Inc., is entered into as of December 5, 1997.
This Amendment Agreement amends and restates the Purchase Agreement as
specified below. Except as amended by this Amendment Agreement, all of the
terms and conditions of the Purchase Agreement will remain in full force and
effect and all of the definitions provided in the Purchase Agreement are
incorporated herein.
1. CASH AT CLOSING. Buyer agrees to pay to Sellers $3,726,203 in
cash at Closing, subject to adjustment pursuant to paragraph (iv) of this
paragraph 2.
2. Section 2(a)(iv) shall be amended to read as follows:
[1] CLOSING ADJUSTMENT TO ASSET PURCHASE PRICE FOR
INVENTORY AND RECEIVABLES. The parties have conducted an appraisal
and evaluation of the inventory to be purchased by Buyer hereunder
(the "Inventory Evaluation") in accordance with procedures set forth
in paragraph (b) below. Notwithstanding Buyer's previous due
diligence, the Purchase Price shall be reduced on a dollar-for-dollar
basis to the extent that the net asset value of the inventory as shown
on such inventory evaluation, together with the aggregate Receivables,
is less than $3,726,203. Such reduction shall be affectuated by a
corresponding reduction in the Assumed Liabilities which Buyer is
obligated to assume hereunder. The reduction to the Purchase Price
hereunder shall be limited to the aggregate value of the Assumed
liabilities. Similarly, the Purchase Price shall be increased on a
dollar-for-dollar basis to the extent that the net asset value of
Receivables and inventory (as shown on the Inventory Evaluation)
exceeds $3,726,203. Buyer shall pay to Sellers any such surplus
within five business days of the final determination of the Inventory
Evaluation, subject to adjustment pursuant to paragraph (vi) of this
paragraph 2.
[2] The parties acknowledge that during the period December 1 to
December 5, 1997, Sellers have operated the Business as
agents for the Buyer. As promptly as possible, but in no event later than
ten days after the Closing, Sellers and Buyer shall exchange information
sufficient to determine the net amount due from Sellers to Buyer or from
Buyer to Sellers as a result of such transactions (the "Stub Period
Adjustment"). Without limiting the generality of the foregoing, Buyer
shall receive the benefit of all receivables, inventory and cash (except
that applied to Assumed Payables) and shall pay all expenses related to the
Business except Excluded Liabilities and payments to Art Xxxxxxxx or
employees in excess of ordinary wages and salaries.
3. Section 5(d) shall be revised to read as follows:
COBRA. Sellers will comply with the provisions of COBRA,
Pub. L. No. 99-272, 99th Cong., 2d Sess. (1987), and any similar state
statute, relating to continuation of health benefits to employees as
they apply to the transaction contemplated hereby. Sellers have
complied with all COBRA requirements for all persons who ceased to be
employees of Sellers prior to the Closing Date and any liabilities for
any COBRA claims under any medical plan of Sellers arising out of
transactions occurring prior to the Closing Date shall be the sole
responsibility of Sellers.
4. The following provision shall be added as section 13(p) of the
Agreement.
(p) 401(k) INDEMNIFICATION. Sellers agree to indemnify
Buyer for any costs, taxes, liabilities or penalties Buyer incurs as a
result of Buyer adopting Seller's 401(k) retirement plan, to the
extent that such costs, taxes, liabilities or penalties are
attributable to the operation or documentation of Seller's 401(k)
retirement plan prior to Buyer's adoption of the plan. Sellers will
reimburse Buyer for the amount of any "top-heavy minimum contribution"
the Buyer is required to make to the 401(k) retirement plan for the
1997 plan year.
5. The parties agree to a Closing Date of December 5, 1997, with the
Closing effective as of December 1, 1997.
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IN WITNESS WHEREOF, the parties have executed this Amendment Agreement
as of the date first written above.
XXXXXXXX BROTHERS COMPANY
BY /s/ Xxxxxx Xxxxxxxx
---------------------------------
Its President
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MILWAUKEE METAL
BRIQUETTING CO., INC.
BY /s/ Xxxxxx Xxxxxxxx
---------------------------------
Its President
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XXXXXX XXXXXXXX, individually
/s/ Xxxxxx Xxxxxxxx
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RECYCLING INDUSTRIES OF
WISCONSIN, INC.
BY /s/ Xxxxxx X. Xxxxx
---------------------------------
Its Chairman and CEO
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RECYCLING INDUSTRIES, INC.
BY /s/ Xxxxxx X. Xxxxx
---------------------------------
Its Chairman and CEO
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