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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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) August 14, 1997
Borden Chemicals and Plastics Limited Partnership
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(Exact name of registrant as specified in its charter)
Delaware 1-9699 31-1269627
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(State of incorporation) (Commission File (I.R.S. Employer
Number) Identification No.)
Highway 73
Geismar, Louisiana 70734
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (614) 225-4482
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Item 5. Other Events.
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On August 14, 1997, Borden Chemicals and Plastics Limited Partnership
(the "Registrant") announced that the Board of Directors of BCP Management,
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Inc., the general partner (the "General Partner") of the Registrant, had
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terminated a previously approved plan pursuant to which the existing ownership
interests in the Registrant would have been exchanged for shares of a newly
formed corporation. A press release announcing the termination of the
conversion is attached hereto as Exhibit 99.1.
In light of the termination of the conversion plan, the Board of
Directors of the General Partner of the Registrant also approved certain
technical modifications to a Rights Agreement between the Registrant and Harris
Trust and Savings Bank. The First Amendment to the Rights Agreement (the "Rights
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Amendment") is attached hereto as Exhibit 99.2. A Second Amendment to the
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Amended and Restated Agreement of Limited Partnership of the Registrant
incorporating the terms of the Rights Amendment is attached as Exhibit 99.3.
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Item 7. Exhibits.
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99.1 Press Release dated August 14, 1997.
99.2 First Amendment to Rights Agreement, dated as of August 14, 1997,
between the Registrant and Harris Trust and Savings Bank.
99.3 Second Amendment to the Amended and Restated Agreement of Limited
Partnership of the Partnership, dated as of August 14, 1997, entered
into by and among the General Partner and the limited partners of the
Partnership.
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the Registrant has duly caused this Report to be signed on its
behalf by the undersigned thereunto duly authorized.
BORDEN CHEMICALS AND PLASTICS
LIMITED PARTNERSHIP
By: BCP Management, Inc., its general partner
By: /s/ Lawrence L. Dieker
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Name: Lawrence L. Dieker
Title: Vice President and General Counsel
DATED: August 18, 1997
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EXHIBIT INDEX
Exhibit No. Description
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99.1 Press Release dated August 14, 1997.
99.2 First Amendment to Rights Agreement, dated as of August 14, 1997,
between the Registrant and Harris Trust and Savings Bank.
99.3 Second Amendment, dated as of August 14, 1997, to the Amended and
Restated Agreement of Limited Partnership, dated as of December 15,
1988, of the Partnership, entered into by and among the General
Partner and the limited partners of the Partnership.
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EXHIBIT 99.1
FOR IMMEDIATE RELEASE Contact:
August 14, 1997 Peter F. Loscocco
614/225-4482
New Law Provides Continued Exemption From Corporate Tax
BORDEN CHEMICALS AND PLASTICS LIMITED PARTNERSHIP
TERMINATES PLAN TO CONVERT TO CORPORATE FORM
COLUMBUS, OHIO (August 14, 1997) -- Prompted by a recent change in tax laws
governing publicly traded limited partnerships, the board of directors of BCP
Management, Inc., the general partner of Borden Chemicals and Plastics Limited
Partnership (NYSE; BCU), today voted to terminate its previously announced plan
to convert ownership interests in the partnership into shares of a newly formed
corporation.
Under tax laws in effect when the decision was made earlier this year to
convert to corporate form, the partnership's exemption from federal income taxes
would have expired at the end of 1997. Borden Chemicals and Plastics would have
been required to pay corporate tax beginning in 1998.
Through a provision in the tax bill signed into law by President Clinton on
August 5, the exemption of publicly traded limited partnerships form federal
income taxes is made permanent, and a new 3.5 percent tax is to be levied on
gross income beginning January 1, 1998. Under the new law, publicly traded
partnerships retain the ability to convert to corporate form in the future,
should they desire.
"We have said all along that our decision to convert to corporate form was
in the best interest of our unitholders, based on existing tax law and the year-
end expiration of our tax exemption," said Joseph M. Saggese, chairman,
president and chief executive officer for the general partner. "Now that the
tax law has changed, the benefits to our unitholders of
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remaining a limited partnership at this time -- even with the 3.5 percent tax --
outweigh those of the proposed conversion."
With the board's action, Borden Chemicals and Plastics will continue to
operate as a publicly traded partnership. The partnership will continue its
policy of distributing available cash at the end of each quarter to its
unitholders, although beginning in 1998, the amount of available cash will be
reduced by the new 3.5 percent tax.
Borden Chemicals and Plastics Limited Partnership manufactures polyvinyl
chloride resins, methanol and derivatives, and nitrogen products at facilities
located in Geismar and Addis, La, and Illiopolis, Ill. BCP Management, Inc. a
wholly owned subsidiary of Borden, Inc., serves as its general partner.
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EXHIBIT 99.2
FIRST AMENDMENT TO RIGHTS AGREEMENT
FIRST AMENDMENT, dated as of August 14, 1997 (this "Amendment"), to
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the Rights Agreement, dated as of April 8, 1997 (the "Rights Agreement"), among
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Borden Chemicals and Plastics Limited Partnership and Harris Trust and Savings
Bank, as Rights Agent.
W I T N E S S E T H:
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WHEREAS, in light of the termination of the Agreement and Plan of
Conversion as of the date hereof, the General Partner desires to amend certain
provisions of the Rights Agreement upon the terms and subject to the conditions
set forth herein and pursuant to the terms of the Rights Agreement, the General
Partner has directed the Rights Agent to enter into this Amendment;
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. Definitions. All terms defined in the Rights Agreement shall
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have such defined meanings when used herein unless otherwise defined herein.
2. Amendment of Section 1. Section 1 of the Rights Agreement is
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hereby amended by deleting paragraph (c) in its entirety and adding the
following new paragraph (c): "(c) [RESERVED]".
3. Amendment of Section 3. Section 3 of the Rights Agreement is
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hereby amended by deleting the penultimate sentence of paragraph (a) in its
entirety.
4. Amendment of Section 7. Paragraph (a) of Section 7 of the Rights
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Agreement is hereby amended by (x) deleting the clause "and (iv) immediately
prior to the Effective Time of the Merger (as defined in the Agreement and Plan
of Conversion)" therein and (y) by deleting the comma immediately preceding
clause (iii) therein and inserting the word "and" in lieu thereof.
5. Amendment of Section 31. Section 31 of the Rights Agreement is
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hereby amended by deleting it in its entirety and inserting in lieu thereof the
following new Section 31: "Section 31. [RESERVED]".
6. Amendment of Exhibit A. Exhibit A to the Rights Agreement is
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hereby amended by deleting the first sentence in the legend in its entirety and
inserting in lieu thereof the following new first sentence: "NOT EXERCISABLE
AFTER APRIL 8, 2007 OR EARLIER IF REDEMPTION OR EXCHANGE OCCURS."
7. Amendment of Exhibit B. Exhibit B to the Rights Agreement is
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hereby amended by deleting the fourth full paragraph following the legend
thereof in its entirety and inserting in lieu thereof the following new
paragraph:
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"The Rights are not exercisable until the Distribution Date. The
Rights will expire on April 8, 2007 (the "Final Expiration Date"),
unless the Final Expiration Date is extended or unless the Rights are
earlier redeemed or exchanged by the Partnership, in each case as
described below."
8. Conditions to Effectiveness. This Amendment shall become
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effective on the date on which a duly authorized officer of each party shall
have duly executed and delivered counterparts of this Amendment to the other
party.
9. Limited Effect. Except as expressly amended herein, the Rights
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Agreement shall continue to be, and shall remain, in full force and effect.
10. Counterparts. This Amendment may be executed by one or more of
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the parties hereto in any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument. This Amendment may be executed by facsimile signatures.
11. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND
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CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed and attested, all as of the day and year first above written.
Attest: BORDEN CHEMICALS AND PLASTICS
LIMITED PARTNERSHIP
By: BCP Management Inc., its general partner
By: /s/ C. Douglas MacLeod By: /s/ Lawrence L. Dieker
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Name: C. Douglas MacLeod Name: Lawrence L. Dieker
Title: Vice President Title: Vice President, General Counsel
and Secretary
Attest: HARRIS TRUST AND SAVINGS BANK
By: /s/ Bernetta Young By: /s/ Lorraine Rodewald
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Name: Bernetta J. Young Name: Lorraine Rodewald
Title: Trust Officer Title: Assistant Vice President
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EXHIBIT 99.3
SECOND AMENDMENT TO
AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
This SECOND AMENDMENT, dated as of August 14, 1997 (this "Amendment"),
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to the Amended and Restated Agreement of Limited Partnership, dated as of
December 15, 1988, of Borden Chemicals and Plastics Limited Partnership, a
Delaware limited partnership (the "Partnership"), as amended by the First
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Amendment thereto, dated as of April 8, 1997 (as so amended and as further
amended, supplemented or modified from time to time, the "Partnership
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Agreement") is entered into by and among BCP Management, Inc., a Delaware
corporation, as general partner of the Partnership, and those Persons listed in
the books and records of the Partnership as limited partners of the Partnership.
W I T N E S S E T H:
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WHEREAS, the Partnership is a limited partnership formed pursuant to
the provisions of the Delaware Revised Uniform Limited Partnership Act, 6 Del.
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C. (S) 17-101, et seq., as amended (the "Act"), and the Partnership Agreement;
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WHEREAS, pursuant to Section 4.4 of the Partnership Agreement, the
General Partner is authorized to cause the Partnership to issue any type of
equity security the Partnership may lawfully issue for any Partnership purpose,
at any time or from time to time, to the Partners or to other Persons for such
consideration and on such terms and conditions as shall be established by the
General Partner in its sole discretion, all without the approval of any Limited
Partners;
WHEREAS, pursuant to Sections 4.4(b) and 15.1 of the Partnership
Agreement, the General Partner may, without the approval of the Limited
Partners, amend the Partnership Agreement in any manner which it deems
appropriate or necessary to provide for each such issuance;
WHEREAS, the Board of Directors of the General Partner has determined
that it is fair and reasonable and in the best interests of the Partnership and
the holders of its Units that the Partnership (i) enter into the First Amendment
to Rights Agreement, substantially in the form of Exhibit A to this Amendment
(the "Rights Amendment"), and (ii) reflect such Rights Amendment in the
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Partnership Agreement by entering into this Amendment.
NOW, THEREFORE, in consideration of the covenants, conditions and
agreements contained herein, and other good, sufficient and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
intending to be legally bound hereby, the parties hereto hereby amend the
Partnership Agreement as follows:
1. Defined Terms. Capitalized terms used but not defined herein
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shall have the meanings given to them in the Partnership Agreement
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2. Amendment to Section 18.1 of the Partnership Agreement. Section
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18.1 of the Partnership Agreement is hereby amended by inserting on the sixth
line thereof after the words "named therein" and before the parenthetical on
such line the following:
", as amended by the First Amendment to Rights Agreement, dated as of
August 14, 1997, and as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the provisions thereof"
3. Amendment to Exhibit A to the Partnership Agreement. Exhibit A
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to the Partnership Agreement is hereby amended by inserting at the end thereof
Exhibit A to this Amendment.
4. No Other Amendments; Confirmation. Except as expressly amended,
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modified and supplemented hereby, the provisions of the Partnership Agreement
are and shall remain in full force and effect.
5. Governing Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF
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THE PARTIES TO THE PARTNERSHIP AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT
REGARD TO PRINCIPLES OF CONFLICT OF LAWS.
6. Binding Effect. The covenants and agreements contained herein
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shall be binding upon and inure to the benefit of the parties hereto and their
respective heirs, executors, administrators, successors, legal representatives
and permitted assigns.
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IN WITNESS WHEREOF, the General Partner has caused this Amendment to
be duly executed and delivered by one of its proper and duly authorized officers
as of the day and year first above written.
BCP MANAGEMENT, INC.
By: /s/ Lawrence L. Dieker
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Name: Lawrence L. Dieker
Title: Vice President, General Counsel
and Secretary
LIMITED PARTNERS:
All Limited Partners now and hereafter
admitted as limited partners of the
Partnership, pursuant to Powers of
Attorney and authorizations now and
hereafter executed in favor of, and
granted and delivered to, the General
Partner:
By: BCP Management, Inc.
By: /s/ Lawrence L. Dieker
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Name: Lawrence L. Dieker
Title: Vice President, General
Counsel and Secretary
