FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 21, 1996
Continental Materials Corporation
(Exact name of registrant as specified in its charter)
Delaware 1-3834 36-2274391
(State or other jurisdiction (Commission (IRS Employers
of incorporation) File Number) Identification No.)
225 West Wacker Drive, Chicago, Illinois 60606
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 312-541-7200
INFORMATION TO BE INCLUDED IN REPORT
Item 2. Acquisition of Assets
On October 21, 1996, pursuant to an Acquisition
Agreement (Exhibit 2A hereto), Registrant
acquired the assets of Valco, Inc.'s ("Valco")
ready mix concrete and aggregates operation in
Pueblo, Colorado for a cash purchase price of
$5,148,000 net of $163,000 of accrued
liabilities assumed. The assets purchased
consist primarily of property, plant and
equipment of $3,559,000, receivables of $917,000
inventories of $335,000 and a covenant not to
compete of $500,000 (Exhibit 2B hereto).
In addition to the above, pursuant to a Fee Sand
and Gravel Lease (Exhibit 2C hereto), Registrant
concurrently entered into a long-term lease to
mine aggregates from properties in Pueblo owned
by Valco. The lease calls for Registrant to pay
Valco 37 cents per ton of aggregate mined with a
minimum annual royalty of $300,000. Both
amounts are subject to inflation adjustments.
The terms and conditions of this acquisition and
lease, including the consideration paid, were
reached as the result of arms-length
negotiations and bargaining between Registrant
and Valco. There was, and is, no material
relationship between the Registrant or any of
its affiliates, directors or officers, or any
associate of any director or officer and Valco.
The acquisition was financed by the proceeds of
the Amended and Restated Revolving Credit and
Term Loan Agreement (Exhibit 2D hereto) also
entered into on October 21, 1996 with the
Registrant's existing lending banks. The
purchased operations are involved in the
production and sale of ready-mix concrete and
other building materials as well as the
extraction and sale of sand and river rock.
Sales are restricted primarily to Pueblo County.
The purchased operations principal premises are
located at 5476 Route 96 West, Pueblo, Colorado.
An additional batch plant is located on East
Route 50 in Pueblo, Colorado.
Item 7. Financial Statements and Exhibits
(b) Pro Forma Financial Information
The acquisition does not meet the
"significance" test as detailed in Item 2
of Form 8-K under the 1934 Act and
Regulation S-X of the 1940 Act, therefore
no proforma financial information is
provided.
(c) Exhibits
See Exhibits Index, page 4 hereof.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
(Registrant) CONTINENTAL MATERIALS CORPORATION
(Signature) /S/Joseph J. Sum
Joseph J. Sum, Vice President - Finance
Date November 1, 1996
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EXHIBITS INDEX
Exhibit 2A Acquisition Agreement Between Valco Properties,
Ltd. and Continental Materials Corporation
Exhibit 2B Non-Competition and Non-Disclosure Agreement by
Valco, Inc. and Thomas E. Brubaker in favor of
Continental Materials Corporation.
Exhibit 2C Fee Sand and Gravel Lease Between Valco, Inc.
and Continental Materials Corporation
Exhibit 2D Amended and Restated Revolving Credit and Term
Loan Agreement Between Continental Materials
Corporation, The Northern Trust Company and
LaSalle National Bank
Omitted Exhibits
No exhibits to Exhibits 2A, 2C or 2D above are filed with this 8-K Report.
Registrant agrees to furnish supplementally with the
Commission a copy of any such omitted exhibit, upon the request
of the Commission.
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