SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) June 21, 1996
EDISON CONTROL CORPORATION
(Exact name of registrant as specified in charter)
New Jersey 0-14812 22-2716367
(State or other jurisdiction Commission (IRS Employer
of Incorporation) File Number Identification No.)
140 Ethel Road West, Piscataway, N.J. 08854
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (908) 819-8800
Not Applicable
(Former name or former address, if changed since last report.)
Item 2. Acquisition or Disposition of Assets
(a) On June 21, 1996, Registrant through a newly
organized, wholly-owned subsidiary, purchased from unaffiliated
persons, namely, Messrs. Allen W. Duhr, Joseph F. Bennett, Alan
J. Kastelic, Robert E. Klemm and Jay R. Hanamann, (herein the
"Shareholders") all of the issued and outstanding stock (the
"Conforms Stock") of Construction Forms, Inc., a Wisconsin
corporation ("ConForms") and its affiliate C F Gilco, Inc.
("Gilco") and all of the issued and outstanding units of another
affiliate, JABCO, LLC, a Wisconsin limited liability company
("JABCO") for an aggregate cash consideration of $20,605,695, of
which $574,000 were Registrant's acquisition costs and of which
$1,500,000 is held in escrow pending certain environmental
remediation on property held by ConForms. In connection with the
acquisition of ConForms, Registrant also acquired all of the
outstanding stock of CF Ultra Tech, Inc., a wholly-owned
Wisconsin subsidiary of ConForms ("Ultra Tech").
ConForms is a leading manufacturer and distributor
of systems of pipes, couplings and hoses and other equipment used
for the pumping of concrete. It manufactures a wide variety of
finished products with which it creates appropriate config-
urations of systems for various concrete pumps. CF UltraTech
processes steel pipe into abrasion resistant hardened pipe for
use in such industries as mining, pulp and paper, power and waste
treatment. C F Gilco produces a line of concrete and
plaster/mortar mixers.
The transaction was negotiated at arm's length and
was based upon Management's analysis of ConForms' assets and
properties, historical profitability and growth, industry
position, business prospects and market valuations of companies
considered to be in related industries and businesses. Funds
utilized in the acquisition included approximately $4,800,000 of
Registrant's operating capital, approximately $9,740,000
available under a Master Credit Agreement between LaSalle
National Bank of Milwaukee, Wisconsin ("LaSalle"), ConForms, C F
Gilco and CF UltraTech (collectively the "Borrowers") and
$6,800,000 under a Loan Agreement between Bank Audi USA of
New York, New York ("Bank Audi") and the Borrowers. JABCO
provided a guarantee in connection with the LaSalle and Bank Audi
loans.
The LaSalle facility includes an $8,000,000
working capital line, of which $5,540,000 was drawn upon at
closing, a $4,300,000 term/overadvance funding line and a
$3,000,000 letter of credit to support an Industrial Revenue Bond
issued on the JABCO property. All of such facilities are cross-
collateralized by the corporate assets of ConForms, Ultra Tech
and Gilco, including accounts receivable, inventory and property
and equipment as well as certain marketable securities of
Registrant. The Credit Agreement contains covenants customary in
such arrangements, including maintenance of certain financial
ratios and minimum tangible net worth and limitations on capital
expenditures. For details, reference is made to the Master
Credit Agreement, filed as Exhibit 10(vi) to this Report.
The Bank Audi long-term facility is subordinated
to LaSalle. For details, reference is made to the Loan Agreement
filed as Exhibit 10(vii) to this Report. In connection there-
with, William Finneran, Chairman of the Board and a principal
shareholder of the Registrant, provided collateral to the Bank to
support a guaranty of repayment by Borrowers of the principal and
interest on the loan. The guaranty is limited to the collateral
value. The foregoing arrangement was made by Mr. Finneran to
reduce Registrant's cost of borrowed funds from that which would
have been otherwise obtainable from unaffiliated "mezzanine"
lenders. In consideration of his providing such collateral,
Registrant issued to Mr. Finneran a ten (10) year Warrant to
purchase 500,000 shares of Registrant's Common Stock exercisable
at a price of $1.60 per share. At the time the transaction was
negotiated, Registrant's Common Stock was quoted at approximately
$4 per share and, on the date the ConForms acquisition was
consummated, the closing sale price for Registrant's Common Stock
in the over-the-counter market was $7 1/2 per share. It is
believed that the transaction with Mr. Finneran was on terms not
less favorable to Registrant than those available from a non-
affiliated person.
(b) As indicated in (a) above, the ConForms purchase
entailed the acquisition of certain property, plant and equipment
used in the ConForms business. Registrant intends to continue
the use of such assets as previously utilized.
Item 5. Other Events.
In connection with the ConForms acquisition, Registrant
entered into agreements for the sale for investment of an
aggregate of 114,933 shares of Registrant's Common Stock for a
total purchase price of $862,000 to the key management personnel
of ConForms and its affiliates as follows: Alan J. Kastelic
(66,667 shares); Jay R. Hanamann (33,333 shares); Robert E. Klemm
(13,333 shares); Craig T. Winebrenner (1,000 shares) and David
Edwards (600 shares). In addition, Registrant granted ten
(10)year options to purchase an aggregate of 167,611 shares of
Common Stock exercisable at $3.00 per share to the foregoing
persons in the following respective denominations: 97,222,
48,611, 19,444, 1,458, and 876 shares. Such options vest fully
on the first anniversary of the closing of the acquisition. On
the date of grant of the options, the closing sale price for
Registrant's Common Stock in the over-the-counter market was
$7 1/2 per share. The foregoing stock sales and option grants
were intended to provide such key personnel with a proprietary
interest in Registrant and to better identify their interests
with those of Registrant's shareholders.
Effective July 1, 1996, Mr. Hanamann was appointed as
Registrant's Treasurer and Chief Financial Officer succeeding
Jack Miller who continues as a Vice President of Registrant in
charge of its electronic fault indicator operations.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits.
Financial Statements and Pro Forma
Financial Information
It is impracticable for Registrant to provide the
required financial statements (including pro forma financial
information) for the acquired businesses at the date of this
Report. The required financial statements and pro forma
financial information shall be filed as soon as available but in
any event not later than 60 days after the date of this Report.
EXHIBITS
10(v) Stock and Unit Purchase Agreement dated June
21, 1996 by and among Registrant,
Construction Forms Acquisition Inc. and the
Shareholders of Construction Forms, Inc., CF
Gilco, Inc. and JABCO, LLC.
10(vi) Master Credit Agreement dated as of June 21, 1996 by
and among Construction Forms, Inc., CF Ultra Tech, Inc.
and CF Gilco, Inc.
10(vii) Loan Agreement dated June 21, 1996 between
Constructions Forms, Inc., CF Ultra Tech, Inc.,
CF Gilco, Inc. and Bank Audi USA.
Schedules and exhibits to the foregoing Exhibits which
are described in the respective documents are omitted.
Registrant agrees to furnish a copy of any such omitted schedule
or exhibit to the Commission upon request.
SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be
signed by the undersigned thereto duly authorized.
EDISON CONTROL CORPORATION
(Registrant)
Date: July 8, 1996 By /s/ Mary McCormack
Mary McCormack, President