Document:

Exhibit 10.7

 

VIA FAX 212.661.1031

 

June 30, 2005

 

MAG
Industrial Automation Systems LLC

Mainco, Inc.

c/o Maxor Inc.

60 E. 42nd Street

New York, NY 10165

 

Attention: Mr. Mo Meidar

 

Re:                             Purchase
and Sale of Cincinnati Lamb Group – Settlement Agreement

 

Dear Mo:

 

This letter agreement sets
forth certain agreements of the Parties to the Purchase and Sale Agreement (the
“Purchase and Sale Agreement”), dated March 17, 2005, as amended, among
UNOVA, Inc. and certain of its subsidiaries (the “Selling Entities”) and
Mainco, Inc., MAG Industrial Automation Systems LLC and certain of their
subsidiaries (the “Purchasing Entities”) pursuant to which the Purchasing
Entities acquired the business and substantially all of the assets and certain
capital stock of the Cincinnati Lamb Group. 
These agreements fully and finally resolve certain potential claims and
obligations of the Parties under the Purchase and Sale Agreement and the
related letter agreement (the “NWA Side Letter”) pursuant to which the Selling
Entities agreed that the net working assets (as defined in the Purchase and
Sale Agreement) on the Closing Balance Sheet would be at least $130,500,000,
and that to the extent that such net working assets were less than that amount,
UNOVA would pay to the Purchasing Entities the amount of such difference (the “NWA
Adjustment”) in cash.  Capitalized
terms used and not otherwise defined in this letter have the meanings stated in
the Purchase and Sale Agreement.

 

1.                                       Closing
Balance Sheet and NWA Adjustment. 
Attached as Exhibit A is the final, agreed upon Closing Balance
Sheet. 
The Parties agree that the NWA Adjustment is $12,553,000.  On April 15, 2005, UNOVA paid to
Purchaser the estimated NWA Adjustment in the amount of $9,550,000.  Upon execution and delivery of this letter
agreement, UNOVA shall pay to Purchaser $3,003,000 in full and final settlement
of the Selling Entities’ obligations under Section 1.8(d) of the
Purchase and Sale Agreement and the NWA Side Letter.

 

2.                                       Proceeds
of Alenia Judgment.  Upon execution
of this agreement, UNOVA will pay to Purchaser the proceeds received by the
Selling Entities from the Alenia judgment in the amount of €1,552,800.

 

 

3.                                       Modification
of Promissory Notes.  The existing
Secured Note is comprised of three notes, Domestic, German and Foreign.  The Domestic Secured Note and the Lamb U.K.
Restructure Note will be modified and restated into a new Domestic Secured
Note, dated the Transfer Date, in the principal amount of $6,454,000 and with a
new payment schedule (the “New Domestic Secured Note”).  The principal payment schedule under the
German Secured Note and the Foreign Secured Note shall be amended, so that
aggregate principal payments under the New Domestic Secured Note, the German
Secured Note and the Foreign Secured Note shall be payable on the following
schedule:

 

(i) $1,454,000 (in the aggregate) shall be
payable on the 24-month anniversary of the Transfer Date,

(ii) $2,000,000 (in the aggregate) shall be
payable on the 30-month anniversary of the Transfer Date,

(iii) $2,000,000 (in the aggregate) shall be
payable on the 36-month anniversary of the Transfer Date,

(iv) $2,500,000 (in the aggregate) shall be
payable on the 42-month anniversary of the Transfer Date,

(v) $2,000,000 (in the aggregate) shall be
payable on the 48-month anniversary of the Transfer Date, and

(vi) $2,500,000 (in the aggregate) shall be
payable on the 54-month anniversary of the Transfer Date.

 

The New Domestic Secured Note shall bear interest at
the rate of LIBOR + 3%, payable quarterly.

 

4.                                       Cost
to Modify Promissory Notes and Related Security Documents.  UNOVA and Purchaser shall share equally the
cost to modify the promissory notes as indicated above, to amend the existing
security agreements and to make any requisite filings.  Such costs shall include only Silver Point
fees, attorney fees and filing fees that are specifically related to such
modification and amendment.

 

5.                                       Saline
Real Estate and Equipment.  The
Selling Entities retained as Excluded Assets certain real property and
equipment located in Saline, Michigan, and classified as Assets Held for Sale,
with an approximate aggregate book value of $6.6 million (collectively, the “Saline
Property”).  Purchaser shall use its reasonable
best efforts to obtain within 90 days following the execution of this agreement
up to three offers to purchase the Saline Property (“Third-Party Offers”).  A Third-Party Offer less the costs of sale is
referred to as a “Net Third-Party Offer.” 
In the event that any of the Net Third-Party Offers are at or above $4
million, the Selling Entities may elect to sell the Saline Property pursuant to
such Third-Party Offer for the amount equal to the highest Net Third-Party
Offer and at the time of such sale (or 90 days after the execution of this
agreement if sooner), the Selling Entities shall pay to Purchaser $2 million;
provided, however, that (i) to the extent the Net Third-Party Offer is
greater than $4 million but less than or equal to $5 million, the amount by
which it exceeds $4 million shall be shared by the Selling Entities and
Purchaser at the rate of 60% to the Selling Entities and 40% to

 

2

 

Purchaser, and (ii) to the extent that the Net
Third-Party Offer is greater than $5 million, the first $1.0 million above $4
million shall be shared as provided in clause (i) and the amount by which
it exceeds $5 million shall be shared by the Selling Entities and Purchaser at
the rate of 80% to the Selling Entities and 20% to Purchaser.  The Selling Entities may but shall not be
obligated to sell the Saline Property if the Net Third-Party Offer is less than
$4 million.  In the event that there are
no Third-Party Offers or the Net Third-Party Offers are less than $4 million,
then 90 days after the execution of this agreement the Selling Entities shall
pay to Purchaser $2 million.

 

6.                                       Payment
of Management Bonuses.  The
Purchasing Entities agree to pay the management bonuses to the Continuing
Employees as accrued on the Closing Balance Sheet.

 

7.                                       Waiver of Certain Additional Claims.  The
Parties agree that except for claims based on fraud:

 

(i) the Purchasing
Entities hereby waive, discharge and release any claim or cause of action that
any such Party now has or may have, known or unknown, or that may arise in the
future, for indemnification from the Selling Entities under (a) Section 11.1(a)
(Misrepresentation or Breach of Warranty), to the extent such claims are based
on any misrepresentation or breach of warranty under the following Sections of
the Purchase and Sale Agreement :(A) 3.2(a) (Financial), (B) 3.3
(Accounts Receivable), (C) 3.4 (Inventories), (D) 3.7 (Right to Use
Properties, Rights and Assets ), (E) 3.8 (Contracts and Commitments), or
(F)3.12 (Product and Service Warranties) (collectively, the “Released
Representations and Warranties”); or (b) Section 11.1(b) (Breach
of Covenant or Agreement) to the extent that such claim relates to a breach or
nonfulfillment, prior to the date of this letter agreement, of a covenant,
agreement or other obligation set forth in the Purchase and Sale Agreement; and

 

(ii) the Selling
Entities hereby waive, discharge and release any claim or cause of action that
any such Party now has or may have, known or unknown, or that may arise in the
future, for indemnification from the Purchasing Entities under Section 11.2(b) (Breach
of Covenant or Agreement) to the extent that such claim relates to a breach or
nonfulfillment, prior to the date of this letter agreement, of a covenant,
agreement or other obligation set forth in the Purchase and Sale Agreement.

 

8.                                       No Further Payments by Selling Entities.  The
Purchasing Entities further agree that, (i) except as specifically
provided in this letter agreement and (ii) except for any indemnification
claim under Section 11.1(a) (Misrepresentation or Breach of Warranty)
other than the Released Representations and Warranties, Section 11.1(b) (Breach
of Covenant or Agreement) to the extent that such claim relates to a breach or
nonfulfillment, following the date of this letter agreement, of a covenant,
agreement or other obligation set forth in the Purchase and Sale Agreement, Section 11.1(c) (Excluded
Liabilities), 11.1(d) (R&B Liabilities), 11.1(e) (Product
Liability), 11.1(f) (Retained Environmental Liabilities of Transferred
Subsidiaries), 11.1(g) (Offsite Disposal), or

 

3

 

11.1(h) (Bulk Sales),
the Purchasing Entities shall be responsible for all debts, liabilities,
obligations, costs and expenses of the Business and shall not be entitled to
and will not make any claim for any additional payment whatsoever from any of
the Selling Entities or their Affiliates under or in connection with the
Purchase and Sale Agreement or the Business, including but not limited to any
claim for amounts incurred by the Purchasing Entities relating to the operation
of the Business prior to or after the Transfer Date or claims by third parties
relating to the Business, and the Purchasing Entities will not tender any such
matter to the Selling Entities or their Affiliates or request of them payment
of or reimbursement for any such amounts or for any other amount.

 

9.                                       Undertaking.  Each of UNOVA, Inc., with
respect to the other Selling Entities, and MAG Industrial Automation Systems
LLC, with respect to the other Purchasing Entities, agrees to use its
reasonable best efforts to cause such other parties to the Purchase and Sale
Agreement to sign this letter agreement as soon as practicable.

 

If the foregoing accurately sets forth our agreement,
please so indicate by signing on behalf of the Purchasing Entities where
indicated below.

 

Sincerely,

 

UNOVA, INC.

Individually
and on behalf of the Selling Entities

 

 

	
  /s/ Michael E.
  Keane

  	
   

  

 

 

Michael E. Keane

Senior Vice President and
Chief Financial Officer

 

Enclosure

 

SO AGREED

 

MAG INDUSTRIAL AUTOMATION
SYSTEMS LLC 

Individually and on behalf of the Purchasing Entities

 

	
  By:

  	
  /s/ Mo Meidar

  	
   

  

 

Mo Meidar

 

SO AGREED

 

UNOVA U.K. LIMITED

 

	
  By:

  	
  /s/ Cathy Younger

  	
   

  
	
  Cathy Younger

  

 

4

 

SO AGREED

 

UNOVA OPERATIONS U.K.
LIMITED

 

(FKA Cincinnati Machine UK
Limited)

 

	
  By:

  	
  /s/ Cathy Younger

  	
   

  
	
  Cathy Younger

  

 

SO AGREED

 

HONSBERG LAMB
SONDERWERKZEUGMASCHINEN GMBH

 

	
  By:

  	
  /s/ Cathy Younger

  	
   

  
	
  Cathy Younger

  

 

SO AGREED

 

INTERMEC CANADA LIMITED

(Successor by Amalgamation to

UNOVA CANADA, Inc.)

 

	
  By:

  	
  /s/ Cathy Younger

  	
   

  
	
  Cathy Younger

  

 

SO AGREED

 

UNOVA INDUSTRIAL AUTOMATION
SYSTEMS, INC.

 

	
  By:

  	
  /s/ Cathy Younger

  	
   

  
	
  Cathy Younger

  

 

SO AGREED

 

UNOVA IP CORP.

 

	
  By:

  	
  /s/ Cathy Younger

  	
   

  
	
  Cathy Younger

  

 

SO AGREED

 

R&B Plastics Holdings, Inc.

 

	
  By:

  	
  /s/ James Benjamin

  	
   

  
	
  James Benjamin

  

 

SO AGREED

 

Cincinnati Machine LLC

 

	
  By:

  	
  /s/ James Benjamin

  	
   

  
	
  James Benjamin

  

 

SO AGREED

 

Lamb Technicon LLC

 

	
  By:

  	
  /s/ James Benjamin

  	
   

  
	
  James Benjamin

  

 

5

 

SO AGREED

 

Lamb Assembly and Test, LLC

 

	
  By:

  	
  /s/ James Benjamin

  	
   

  
	
  James Benjamin

  

 

SO AGREED

 

“Caroline” Ein hundertdritte

Vermö gensverwaltungsgesellschaft MbH

 

	
  By:

  	
  /s/ James Benjamin

  	
   

  
	
  James Benjamin

  

 

SO AGREED

 

MAGUS GmbH

 

	
  By:

  	
  /s/ James Benjamin

  	
   

  
	
  James Benjamin

  

 

SO AGREED

 

MAG IP GmbH

 

	
  By:

  	
  /s/ James Benjamin

  	
   

  

 

SO AGREED

 

Lamb Technicon, Ltd.

 

	
  By:

  	
  /s/ James Benjamin

  	
   

  
	
  James Benjamin

  

 

SO AGREED

 

Cincinnati Machine Limited

 

	
  By:

  	
  /s/ James Benjamin

  	
   

  
	
  James Benjamin

  

 

SO AGREED

 

Lamb Technicon Limited

 

	
  By:

  	
  /s/ James Benjamin

  	
   

  
	
  James Benjamin

  

 

6Exhibit 4.1

 

OUTDOOR
CHANNEL HOLDINGS, INC.

INCORPORATED UNDER THE LAWS OF
THE STATE OF DELAWARE

75,000,000 SHARES AUTHORIZED $0.001 PAR VALUE

 

 

	
  THIS CERTIFIES THAT

  	
   

  
	
   

  	
   

  
	
   

  	
  CUSIP 690027
  20 6

  
	
   

  	
   

  
	
   

  	
  SEE REVERSE

  
	
   

  	
  FOR CERTAIN
  DEFINITIONS

  

 

[LOGO]

 

 

is the owner of

 

fully paid and non-assessable
shares of the common stock, $0.001 par value, of

OUTDOOR
CHANNEL HOLDINGS, INC.

 

transferable on the books of the Corporation
by the holder hereof in person or by duly authorized attorney upon surrender of
this certificate properly endorsed. This certificate is not valid until
countersigned by the transfer agent and registered by the Registrar.

 

In Witness Whereof, the Corporation has caused this certificate to be
signed by the facsimile signatures of its duly authorized officers and to be
sealed with the facsimile seal of the Corporation.

 

Dated:

 

 

	
   

  	
   

  	
  

  	
   

  	
   

  
	
  

  	
   

  	
   

  	
  

  
	
  SECRETARY

  	
  PRESIDENT

  

 

 

	
   

  	
  COUNTERSIGNED:

  
	
   

  	
  Computershare
  Trust Company, Inc.

  	
   

  
	
   

  	
  P.O. Box
  1596

  	
   

  
	
   

  	
  Denver,
  Colorado 80201

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Transfer
  Agent & Registrar Authorized Signature

  	
   

  
					

 

 

OUTDOOR
CHANNEL HOLDINGS, INC.

 

TRANSFER
FEE: $25.00 PER NEW CERTIFICATE ISSUED

 

The following abbreviations when used in the
Inscription of the face of this certificate, shall be construed as though they
were written out in full according to applicable laws of regulations:

 

	
  TEN COM

  	
  -as tenants in common

  
	
  TEN ENT

  	
  -as tenants by the entireties

  	
  UNIT GIFT MIN ACT-

  	
                       Custodian

  	
   

  
	
  JT TEN

  	
  -as joint tenants with righ of

  	
  (Cust)

  	
      (Minor)

  
	
   

  	
  survivorship and not as tenants

  	
  under Uniform Gifts to Minors

  	
   

  
	
   

  	
  In common

  	
  Act

  	
   

  	
   

  
	
   

  	
   

  	
  (State)

  	
   

  
								

 

Additional abbreviations may
also be used though not in the above list.

 

                                                                                                                                                                                                                        

 

	
  For Value
  Received,                                                
  hereby sell, assign and transfer unto

  

 

PLEASE INSERT SOCIAL SECURITY OR OTHER

IDENTIFYING NUMBER OF ASSIGNEE

 

	
  

  

 

 

(PLEASE PRINT OR TYPE WRITE
NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)

 

                                                                                                                                                                                                                        

 

                                                                                                                                                                                                                        

 

                                                                                                                                                                                                            Shares
of the Common Stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint
                                                                                          attorney-in-fact
to transfer the said stock on the books of the within-named Corporation, with
full power of substitution in the premises.

 

	
  Dated

  	
   

  	
   

  

 

	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NOTICE: THE SIGNATURE(S) TO THIS ASSIGNMENT
  MUST CORRESPOND WITH THE NAME(S) AS WRITTEN UPON THE FACE OF THE CERTIFICATE
  IN EVERY PARTICULAR WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE
  WHATSOEVER.

  

 

 

Signature(s) Guaranteed:

 

 

	
   

  	
   

  

 

 

The signature(s) should be guaranteed by an eligible guarantor
institution (Banks, Stockbrokers, Savings and Loan Associations and Credit
Unions with membership in an approved signature guarantee Medallion Program),
pursuant to S. E. C. Rule 17 Ad-15.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00089-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00089-of-00352.parquet"}]]