<PAGE>
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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: DECEMBER 1, 1997
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KOPPERS INDUSTRIES, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
PENNSYLVANIA 1-12716 25-1588399
(State or Other (Commission (I.R.S. Employer
Jurisdiction of File Number) Identification Number)
Incorporation)
436 SEVENTH AVENUE PITTSBURGH, PA 15219-1800
(Address of Principal (Zip code)
Executive Offices)
(412) 227-2001
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE
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<PAGE>
KOPPERS INDUSTRIES, INC.
FORM 8-K
DECEMBER 1, 1997
ITEM 2.ACQUISITION OF ASSETS
On December 1, 1997, Koppers Industries, Inc. (the "Company")
completed the purchase of 50% of Koppers Australia Pty. Limited
("Koppers Australia") from the Broken Hill Proprietary Company
Limited ("Broken Hill") for approximately $65 million, which
increases the Company's ownership of the outstanding voting stock of
Koppers Australia to 100%.
Products and services provided by Koppers Australia are similar to
those provided by the Company. Koppers Australia is Australia's
largest manufacturer of carbon pitch, wood preservatives and treated
wood products and it markets these products, as well as carbon black,
in Australia, New Zealand and other Pacific Rim nations. Koppers
Australia is the only coal tar distiller in Australia.
The acquisition was financed as an integral part of a
recapitalization by the Company (see Item 5).
The Company intends to file audited financial statements and other
required data within 60 days of this filing.
ITEM 5.OTHER EVENTS
SARATOGA INVESTMENT
On October 15, 1997, KAP Investments, Inc. (a wholly-owned subsidiary
of Koppers Australia) and a group of approximately 140 stockholders,
the majority of which are employees of the Company (the "Management
Investors") (collectively, the "Offeree Stockholders") acquired from
Cornerstone-Spectrum, Inc. (an affiliate of Beazer East, Inc. and
Hanson PLC) its voting and non-voting shares of common stock of
Koppers Industries, Inc. ("Common Stock"). The Offeree Stockholders
utilized $52.5 million of financing from Koppers, Saratoga Partners
III, L.P. ("Saratoga") and Saratoga Koppers Funding, Inc. ("Saratoga
Koppers"). The Company loaned the Offeree Stockholders $17.0 million,
and Saratoga and Saratoga Koppers loaned the Offeree Stockholders
$35.5 million. In exchange for forgiveness of the loans provided by
the Company, Saratoga and Saratoga Koppers, the Offeree Stockholders
subsequently transferred 1,350,820 non-voting shares of Common Stock
to the Company and 464,180 non-voting shares of Common Stock and
2,117,952 voting shares of Common Stock to Saratoga and Saratoga
Koppers (the "Saratoga Investment"). On December 1, 1997, Saratoga
exchanged the shares of Common Stock it acquired in the Saratoga
Investment for shares of a new series of senior convertible preferred
stock of Koppers Industries, Inc., which entitles Saratoga to elect a
majority of the Board of Directors of the Company (the "Board of
Directors") and to exercise a majority of the voting power over all
outstanding stock of Koppers Industries, Inc. with respect to all
other matters subject to a stockholder vote.
REFINANCING TRANSACTIONS
On December 1, 1997, the Company completed a private placement of
$175.0 million of 9 7/8% Senior Subordinated Notes due 2007 (the
"Notes due 2007") and established with Swiss Bank Corporation,
Stamford Branch and Mellon Bank, N.A. a total of $135.0 million of
senior term loan facilities and a $140.0 million senior revolving
credit facility ($40.0 million and $20.0 million of which was
reserved for use by Koppers Australia in connection with a term loan
and a revolving credit facility, respectively) (the "New Credit
Facilities"). The proceeds from the New Credit
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Facilities and the sale of the Notes due 2007 have been and are being
used to complete the following transactions: (i) the acquisition of
Broken Hill's 50% interest in Koppers Australia; (ii) the repayment
of all of the 8 1/2% Senior Notes of Koppers Industries, Inc. due
February 1, 2004 tendered pursuant to a tender offer and consent
solicitation which was commenced October 20, 1997; (iii) the
repayment of the outstanding indebtedness of approximately $88.1
million under the Company's and Koppers Australia's term loans and
revolving credit facilities; (iv) the redemption of 1,813,200 shares
of non-voting Common Stock owned by APT Holdings Corporation, an
affiliate of Mellon Bank, N.A. for $22.9 million; (v) the redemption,
at $17.00 per share, of certain shares of Common Stock owned by
Management Investors within sixty (60) days after compliance with
applicable securities laws, at the election of such individuals, in
an aggregate amount not to exceed $15.0 million; (vi) the redemption
of 436,508 non-voting shares of Common Stock from Saratoga Koppers;
and (vii) the payment of related fees and expenses.
CLOSING OF WOODWARD, ALABAMA COKE FACILITY
On December 8, 1997 the Company announced that it has decided to
close its Woodward, Alabama coke facility located in Jefferson
County, Alabama effective in early January 1998. This decision was
based on continuing losses at the facility combined with the advanced
ages of the coke oven batteries, ongoing environmental requirements
and the need for significant capital expenditures.
Closure of the Woodward coke facility is expected to result in a
charge to earnings for the Company in the fourth quarter of 1997 of
approximately $38.5 million.
EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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<C> <S>
2.1 Agreement for Sale of Shares by and among BHP Nominees
Investments No. 3 Pty Ltd, The Broken Hill Proprietary Company
Limited, Koppers Industries, Inc., Koppers Australia Pty
Limited, Continental Carbon Australia Pty Limited and Kap
Investments, Inc.
2.2 Variation Agreement by and among BHP Nominees Investments No. 3
Pty Ltd, The Broken Hill Proprietary Company Limited, Koppers
Industries, Inc., Koppers Australia Pty Limited, Continental
Carbon Australia Pty Limited and Kap Investments, Inc.
</TABLE>
SIGNATURE
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.
KOPPERS INDUSTRIES, INC.
Dated December 15, 1997 By /s/ Donald E. Davis
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Donald E. Davis,
Vice President and
Chief Financial Officer
<PAGE>
Exhibit 2.1
Dated 8 October 1997
Agreement for Sale of
Shares
BHP NOMINEES NO. 3 PTY LTD
("Vendor")
THE BROKEN HILL
PROPRIETARY COMPANY
LIMITED
("BHP")
KOPPERS INDUSTRIES, INC.
("Purchaser")
KOPPERS AUSTRALIA PTY
LIMITED ("Company")
CONTINENTAL CARBON
AUSTRALIA PTY LIMITED
("Continental Carbon")
KAP INVESTMENTS, INC.
("KAP Investments")
Mallesons Stephen Jaques
Solicitors
Rialto, Level 28
525 Collins Street
Melbourne Vic 3000
Tel: (03) 0643 4000
JA:RPL/BROK2129-002
<PAGE>
Contents Agreement for Sale of Shares
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1 Interpretation 2
2 Sale and purchase of Shares 4
3 Purchase Price 4
4 Conditions precedent to Completion 4
5 Completion 5
6 Payment of Dividend 6
7 Conduct of Business Pending Completion 6
8 Separation Issues 8
9 Superannuation 13
10 Fallback Protections 14
11 Warranties & representations 16
12 Costs and stamp duty 17
13 Notices 17
14 Miscellaneous 18
Exercise of rights 18
Waivers and variation 18
No merger 18
Survival of indemnities 18
Enforcement of indemnities 18
Further assurances 18
Publicity 18
Time of the essence 19
Entire agreement 19
15 Governing law, jurisdiction and service of process 19
16 Partial execution 19
17 Counterparts 19
Annexure A
Annexure B
Annexure C
<PAGE>
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Agreement for Sale of Shares
Date: 8 October 1997
Parties: BHP NOMINEES NO. 3 PTY LTD (ACN 006 528 678) having its
registered office at 600 Bourke Street, Melbourne, Victoria,
3000 ("Vendor")
THE BROKEN HILL PROPRIETARY COMPANY LIMITED (ACN 004 028 007)
having its registered office at 600 Bourke Street, Melbourne,
Victoria, 3000 ("BHP")
KOPPERS INDUSTRIES, INC. of 436 Seventh Avenue, Pittsburgh,
Pennsylvania ("Purchaser")
KOPPERS AUSTRALIA PTY LIMITED (ACN 000 566 629) having its
registered office at 15 Blue Street, North Sydney ("Company")
CONTINENTAL CARBON AUSTRALIA PTY LIMITED (ACN 000 486 966)
having its registered office at 15 Blue Street, North Sydney
("Continental Carbon")
KAP INVESTMENTS, INC. a Delaware corporation ("KAP
Investments")
Recitals:
A. The Company has an authorised share capital of $20 million
divided into:
(a) 6,187,500 A class shares of $1 each;
(b) 5,187,500 B class shares of $1 each;
(c) 2,183,824 C class shares of $1 each;
(d) 5,441,176 ordinary shares of $1 each, of which;
(e) 6,187,500 A class shares of $1 each;
(f) 6,187,500 B class shares of $1 each; and
(g) 2,183,824 C class shares of $1 each,
having been issued and credited as fully paid.
B. The Vendor is the registered holder and beneficial owner of all
the A class shares which have been issued in the capital of the
Company ("Shares").
C. The Purchaser and the Vendor have both been shareholders in the
Company for many years and throughout that period they have
each had representatives on the board of directors of the
Company.
D. BHP is the ultimate holding company of the Vendor and
acknowledges entering into this agreement in consideration of
the Purchaser entering into this agreement.
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2
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Operative provisions:
1 Interpretation
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1.1 The following words have these meanings in this agreement unless the
contrary intention appears.
Associated Persons means the Vendor, BHP, BHP's Related Bodies
Corporate, Centaurus Corporate Finance Pty Limited, Mallesons Stephen
Jaques and the directors, partners, officers, employees, agents and
advisers of any of them.
Business Day means a day on which trading banks are open for general
business in Melbourne.
CC Operating Profit means the operating profit after tax and before
------
interest and head office expenses earned by Continental Carbon for
---------------------------------
the financial year ended 30 June 1999 calculated in accordance with
clause 8.2(e).
Coal Tar Contract means an agreement between BHP, Australian Iron and
Steel Pty Limited, Koppers Coal Tar, the Company and the Purchaser in
the terms contemplated by clause 8.5.
Completion means settlement of the sale and purchase of the Shares in
accordance with clause 5 and Complete has a corresponding meaning.
Completion Date means 5 Business Days after the last to occur of the
conditions set out in clause 4 or any other date agreed by the Vendor
and the Purchaser.
Cornerstone mans Cornerstone-Spectrum, Inc. of 1 Oxford Centre, Suite
3000 Pittsburgh.
KII Stockholders' Agreement means the agreement originally dated 28
December 1988 (as subsequently amended) between the Purchaser, KAP
Investments and others.
Koppers Coal Tar means Koppers Coal Tar Pty Limited (ACN 003 947 699).
Management Investors means the management investors within the meaning
of the KII Stockholders' Agreement as at the date of this agreement.
Profit Shortfall has the meaning given in clause 8.2(c).
Related Body Corporate of a body corporate means another body
corporate which as at the date of this agreement is related to the
first within the meaning of section 50 of the Corporations Law.
Saratoga means Saratoga Partners III, L.P.
Saratoga Commitment Letter means the commitment letter from Saratoga
to each of the Purchaser, Management Investors and KPA Investments in
the form of Annexure C.
Shares means the 6,187,500 A class shares of $1 each issued in the
capital of the Company agreed to be sold under this agreement and
Share means any one of those shares.
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3
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South Pacific Tyres means the partnership known as South Pacific Tyres
between the Pacific Dunlop group and the Goodyear group.
SPT Compensation Amount has the meaning given in clause 8.2(b).
Steelworks Site means all the land at Newcastle presently owned or
occupied by BHP or any of its Related Bodies Corporate used currently
in connection with the manufacturing and processing of iron and steel.
Warranties means the warranties and representations in this agreement,
including clause 11.
1.2 In this agreement unless the contrary intention appears:
(a) a reference to a clause, schedule, annexure or appendix is a
reference to a clause of or schedule, annexure or appendix to
this agreement and references to this agreement include any
recital, schedule, annexure or appendix;
(b) a reference to this agreement or another instrument includes any
variation or replacement of either of them;
(c) a reference to a statute, ordinance, code or other law includes
regulations and other instruments under it and consolidations,
amendments, re-enactments or replacements of any of them;
(d) the singular includes the plural and vice versa;
(e) the word person includes a firm, a body corporate, an
unincorporated association or an authority;
(f) a reference to a person includes a reference to the person's
executors, administrators, successors, substitutes (including,
but not limited to, persons taking by novation) and assigns;
(g) an agreement, representation or warranty in favour of two or more
persons is for the benefit of them jointly and severally;
(h) an agreement, representation or warranty on the part of two or
more persons binds them jointly and severally;
(i) if a period of time is specified and dates from a given day or
the day of an act or event, it is to be calculated exclusive of
that day;
(j) a reference to a day is to be interpreted as the period of time
commencing at midnight and ending 24 hours later; and
(k) all references to dollars and "$" are references to Australian
currency
1.3 Headings are inserted for convenience and do not affect the
interpretation of this agreement.
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4
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2 Sale and purchase of Shares
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2.1 The Vendor agrees to sell and transfer the Shares to the Purchaser and
the Purchaser agrees to purchase the Shares from the Vendor on the
terms and conditions of this agreement.
2.2 The Shares must be transferred free from any mortgage, charge, lien,
pledge or other encumbrance and with all rights, including dividend
rights, attached or accruing to them on and from the date of this
agreement, other than the dividend referred to in clause 6.
3 Purchase Price
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Subject to clause 6.3, the consideration payable for the Shares is $70
million.
4 Conditions precedent to Completion
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4.1 Completion is conditional on:
(a) the Treasurer of the Commonwealth of Australia consenting, under
the Foreign Acquisitions and Takeovers Act 1975, to the proposed
acquisition by the Purchaser of the Shares and the Treasurer is to
be deemed to have so consented:
(i) if the Purchaser receives written advice from the Treasurer
or on his behalf, without any term or condition which the
Purchaser considers unacceptable, to the effect that the
acquisition of the Shares is not objected to under the
Foreign Acquisitions and Takeovers Act 1975; or
(ii) if ten days have elapsed from the day the Treasurer ceased to
be empowered to make any order under Part II of the Foreign
Acquisitions and Takeovers Act in relation to the proposed
acquisition because of lapse of time, notice of the proposed
acquisition of the Shares having been given to the Treasurer
under the Foreign Acquisitions and Takeovers Act 1975;
(b) the Purchaser arranging financing on terms reasonably satisfactory
to it to fund the purchase of the Shares.
4.2 Each of the parties must use all reasonable endeavours and shall each
co-operate with the others to obtain the fulfilment of the conditions
in clause 4.1, in particular the fulfilment of clause 4.1(a), before 28
November 1997.
4.3 The Purchaser acknowledges that immediately prior to execution of this
agreement SBC Warburg Dillon Read Inc. provided a letter addressed to
the Purchaser confirming that it was highly confident of its ability to
procure finance for the Purchaser on terms that had been previously
disclosed to the Purchaser and which the Purchaser acknowledges would
satisfy the conditions set out in clause 4.1(b). A copy of that letter
is attached as Annexure A. The Purchaser acknowledges that if financing
is available on terms no less favourable to those set out in Annexure
B, the condition set out in clause 4.1(b) will be satisfied. SBC
Warburg Dillon Read Inc. will be the preferred provider of financing to
the Purchaser. However, if SBC Warburg Dillon Read Inc. does not
provide financing to the Purchaser, BHP may
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5
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procure alternative sources of finance for the Purchaser and provided
the terms upon which that finance is made available to the Purchaser
are no less favourable than the terms set out in Annexure B, the
condition in clause 4.1(h) will be deemed to be satisfied.
4.4 If:
(a) any of the conditions in cause 4.1 are not fulfilled by 22
January 1998 or a later date agreed on by the Vendor and the
Purchaser; or
(b) any consent or approval required under any of those conditions is
not granted on terms reasonably acceptable to the Purchaser.
then, if the party who seeks to avoid the agreement has completed with
clause 4.2, the provisions of this agreement relating to the sale of
the Shares may be terminated at any time before Completion by notice
given by the Purchaser or the Vendor to the other of them.
4.5 If the provisions of the agreement relating to the sale of the Shares
are terminated under clause 4.4 then, the provisions in clauses 10,
11, 12, 13, 14, 15 and 16 remain in full force and effect and while
the Vendor and the Purchaser are released from their obligations in
relation to the sale and purchase of the Shares each party retains the
rights it has against any other party in respect of any past
breaches.
5. Completion
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5.1 Completion of the sale and purchase of the Shares will take place at
11:00 a.m. on the Completion Date at the offices of BHP at 600 Bourke
Street, Melbourne, Victoria or such other time and place as the Vendor
and the Purchaser may agree.
5.2 Immediately prior to Completion (or at any earlier time agreed between
the Purchaser and the Vendor) the Company must pay a dividend as
contemplated by clause 6.
5.3 The Vendor agrees to do the following on Completion:
(a) deliver to the Purchaser or its solicitors executed transfers in
favour of the Purchaser of all the Shares together with the share
certificates for the Shares and any consents that the Purchaser
reasonably requires; and
(b) cause:
(i) the board of directors of the Company to direct that, subject
to the payment of stamp duty, the transfers of the Shares
be registered;
(ii) subject to the articles of association of the Company, the
appointment to the board of directors of the Company of the
Purchaser's nominees and the resignation from those boards,
on terms approved by the Purchaser, of those directors
presently representing the Vendor but so that a properly
constituted board of directors is in existence at all times.
5.4 The Purchase agrees to pay to the Vendor at Completion the purchase
price for the Shares by bank cheque or other immediately available
funds.
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6
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5.5 On or before Completion BHP, the Company and the Purchaser must
enter into and the Purchaser must procure Koppers Coal Tar to enter
into the Coal Tar Contract as contemplated by clause 8.5.
5.6 If necessary, the Purchaser and the Vendor must procure the consent
of the C class shareholder in the Company to the transfer of the
Shares.
5.7 Each of the matters required to be done under this clause 5 are
interconnected and interconditional matters to be carried out as
close to contemporaneity as is practicable but in any event on or
before Completion. Completion is dependent upon fulfilment of this
clause 5.7.
6 Payment of Dividend
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6.1 The Purchaser and the Vendor agree that prior to Completion they
will cause the board of directors of the Company, on a date not
later than the day before the payment of the dividend, to declare
a dividend on the terms set out below and to procure the Company
prior to Completion to pay that dividend.
"Resolved, in accordance with the Company's articles of
association, to declare an interim dividend totalling $40 million,
payable in equal parts to the A class and B class shareholders
of the Company registered as such on the date of the resolution,
credited as fully franked".
6.2 The Purchase must support the procurement of the necessary funding
to enable the Company to pay the dividend required to be paid under
clause 6.1.
6.3 If no dividend is received by the Vendor or the dividend received
by the Vendor is less than $20 million, the purchase price will
be increased by the amount of the shortfall.
7 Conduct of Business Pending Completion
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7.1 Until Completion, the Vendor and Purchaser agree that the Company
and its Related Bodies Corporate will continue to carry on business
in accordance with current management plans and budgets for the
1997/1998 financial year of the Company.
7.2 The Purchaser, the Vendor and the Company agree to procure the exercise
of pre-emptive rights held by KAP Investments under the KII
Stockholders' Agreement in relation to a seller's notice dated 29
September 1997 given by Cornerstone ("Seller's Notice"). The exercise
of those pre-emptive rights will be implemented in the following
manner:
(a) Saratoga has issued the Saratoga Commitment Letter to the
Purchaser, KAP Investments and Management Investors.
(b) KAP Investments and Management Investors will issue a joint
acceptance notice of the Seller's Notice to acquire all the
stock currently held by Cornerstone in the Purchaser on or
before 8 October 1997.
(c) Saratoga will lend US $35.5 million, and the Purchaser will
lend US$17,020,328, to Pittsburgh Acquisition Inc.
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7
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(d) On the closing of the transaction referred to in 7.2(b), a bank
wire transfer will be made to Cornerstone in the amount of
US$52,520,328. In return, Cornerstone will deliver to Management
Investors and KAP Investments the necessary stock certificates and
three blank stock powers relating to the stock referred to in
7.2(b).
(e) On receipt of the stock certificates and stock powers referred to
in 7.2(d), one stock power will be executed in favour of the
Purchaser for 1,350,820 non-voting shares in the Purchaser in
repayment of the Purchaser's loan to Pittsburgh Acquisition Inc
referred to in clause 7.2(c). The remaining two stock powers will
be used to transfer 2,117,952 voting shares and 464,180 non-voting
shares in the Purchaser to Saratoga, in repayment of Saratoga's
loan to Pittsburgh Acquisition Inc. referred to in clause 7.2(c),
to be held in escrow pending completion of the necessary
notification filing under the Hart Scott Rodino Anti-Trust
Improvements Act of 1976 ("HSR Act"). After the necessary
approvals have been obtained under the HSR Act, the escrow agent
will transfer the 2,117,952 voting shares and 464,180 non-voting
shares in the Purchaser to Saratoga.
(f) At the conclusion of the steps set out in clause 7.2(a) - (e),
the Purchaser will have four shareholders being KAP Investments,
Saratoga, Management Investors and Mellon Bank Corporation through
its wholly owned subsidiary APT Holdings Corporation. At no time
during the steps outlined under this clause 7.2 will any party
acquire a beneficial interest in more than 50% of the voting stock
in the Purchaser for the purposes of the KII Stockholders'
Agreement.
7.3 In relation to the exercise of pre-emptive rights contemplated by
clause 7.2, the Purchaser makes the following representations and
warranties to the Vendor, BHP, the Company and through the Company to
KAP Investments:
(a) The steps set out in clause 7.2 are a complete and accurate
description of the transactions contemplated in relation to the
stock in the Purchaser the subject of the Seller's Notice.
(b) All necessary consents and authorities have been obtained by the
Purchaser and all of its Related Bodies Corporate in order to
enter into and give effect to the transactions contemplated in
clause 7.2.
(c) Mellon Bank Corporation, (which through its wholly-owned
subsidiary APT Holdings Corporation, is a stockholder in the
Purchaser and in its own right is a creditor of the Purchaser)
has been fully informed of all material matters in relation to the
transactions contemplated by this agreement.
(d) Mellon Bank Corporation has informed the Purchaser that it will
not (through its wholly owned subsidiary APT Holdings Corporation)
exercise its pre-emptive rights in respect of the stock in the
Purchaser the subject of the transactions contemplated in
clause 7.2.
(e) The Purchaser has available to it the necessary funds to enable it
to lend Pittsburgh Acquisition Inc. US$17,020,328.
(f) The entry into and performance of the various arrangements
contemplated by clause 7.2 will not constitute a breach of any
obligation (including any
<PAGE>
8
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statutory, contractual or fiduciary obligations) or default under
any agreement or undertaking by the Purchaser or the Management
Investors.
7.4 In agreeing to carry out the steps referred to in clause 7.2, KAP
Investments has relied on the Saratoga Commitment Letter.
8 Separation Issues
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8.1 Operation
The provisions of this clause 8 apply after Completion. If Completion
does not occur the provisions of this clause 8 do not come into effect.
8.2 South Pacific Tyres Contract
(a) Continental Carbon is presently seeking to secure a contract with
South Pacific Tyres to supply 100% of the South Pacific Tyres'
carbon black requirements. Continental Carbon has forecast $2.909
million as the CC Operating Profit. If Continental Carbon does not
obtain a contract to supply 100% of the carbon black requirements
of South Pacific Tyres, BHP has agreed to compensate Continental
Carbon for lost profits in accordance with this clause 8.2.
(b) The SPT Compensation Amount is an amount equal to 6 times the
Profit Shortfall during the financial year of the Company ending
30 June 1999 up to a maximum of $11 million.
(c) The Profit Shortfall is an amount equal to the lesser of:
(i) the amount, if any, by which the CC Operating Profit is
reduced by reason of Continental Carbon's failure to obtain
the contract with South Pacific Tyres after mitigation in
accordance with clause 8.2(d);
(ii) the amount, if any, by which the CC Operating Profit is less
than $2.909 million.
(d) Each of Continental Carbon, the Company and the Purchaser must
use reasonable endeavours to seek to obtain the contract to
supply 100% of the carbon black requirements of South Pacific
Tyres. If, notwithstanding the exercise of reasonable endeavours,
Continental Carbon does not obtain that contract, each of
Continental Carbon, the Company and the Purchaser must use
reasonable endeavours to minimise the reduction in the CC
Operating Profit attributable to the failure of Continental Carbon
to conclude that contract by arranging for alternative supply
contracts with other purchasers.
(e) In calculating the CC Operating Profit and in calculating the
amount, if any, by which that CC Operating Profit has been reduced
by reason of Continental Carbon's failure to obtain the contract
with South Pacific Tyres, the same accounting policies and
principles as those used by the management of the Company in
preparing the revised 3 year budget for the Company and its
Related Bodies Corporate dated 5 September 1997 should be applied.
In particular, no allowance should be made for any head office or
corporate expenses or interest so that the CC Operating Profit is
calculated by reference to the gross revenues of Continental
Carbon less cost of goods sold,
<PAGE>
9
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administrative expenses directly attributable to Continental
Carbon, depreciation and tax.
(f) BHP must pay the SPT Compensation Amount, if any, to Continental
Carbon on 30 September 1999.
8.3 Steelwork Site facilities
(a) At present, the Company has storage, discharge, pipeline and
loading facilities situated on the Steelworks Site. BHP has
announced its intention to close its steel making activities in
Newcastle and is currently examining proposals for the
redevelopment of the Steelworks Site. As part of the redevelopment
of the Steelworks Site, BHP may wish to deal with the site in a
way which would require the removal or relocation of various
storage, discharge, pipeline or loading facilities currently used
by the Company.
(b) The Company and the Purchaser acknowledge that BHP is free to
deal with the Steelworks Site (including by way of sale or
redevelopment) in such manner as it sees fit and, if requested by
BHP, the Company must remove or relocate all or part of the
various storage, discharge, pipeline or loading facilities
currently used by it that are situated on the Steelworks Site.
(c) Without limiting the discretion BHP has as to the manner in which
it deals with the Steelworks Site, BHP agrees to co-operate with
the Company to minimise the capital expenditure which the Company
needs to incur as a result of that dealing in connection with
relocating its storage, discharge, pipeline or loading facilities
at the Steelworks Site and to the extent that the Company
reasonably incurs such capital expenditure exceeding A$6.5million,
BHP agrees to pay to the Company 50% of such excess.
(d) BHP's maximum liability under paragraph 8.3(c) is A$9 million.
(e) BHP's liability under paragraph 8.3(c) only applies in relation to
capital expenditure incurred and claimed within 5 years from the
Completion Date.
8.4 Claims Procedure
(a) Continental Carbon and the Company must each provide BHP with any
information it reasonably requests in connection with matters
relevant to clauses 8.2 or 8.3.
(b) If either the Company or Continental Carbon at any time anticipate
that there is a possibility they will make a claim under either
clauses 8.2 or 8.3 they must notify BHP as soon as practicable,
provide BHP with all material information lawfully able to be
disclosed so that BHP is able to make an informed assessment of
the matter and then, if practicable, consult with BHP in order to
minimise the amount of any claim which might otherwise arise under
clauses 8.2 or 8.3. Without limiting the generality of this
requirement to consult, where practicable the Company must give
BHP reasonable prior written notice of any plans for the
relocation of its storage discharge, pipeline or loading
facilities at the Steelworks Site and the Company must, where
practicable, consult with BHP prior to incurring any capital
expenditure in relation to any of those items.
<PAGE>
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(c) A claim under clauses 8.2 or 8.3 must be accompanied by a detailed
explanation of the circumstances giving rise to the claim giving a
full breakdown of all calculations of amounts involved in the
claim, providing copies of all supporting invoices and records and
giving particulars of all steps taken by either Continental Carbon
or the Company to minimise the amount of that claim.
(d) As soon as a formal claim for compensation is made under clauses
8.2 or 8.3 BHP and the relevant party making the claim must meet
together to review the claim and agree on the amount payable by
BHP. Any undisputed item of a formal claim must be paid by BHP
within 30 days after the amount payable for that item is agreed
(but in the case of a payment of a claim under clause 8.2, not
before 30 September 1999). If a dispute relating to issues of fact
arises out of or related to one or more items of any claim made
under clauses 8.2 or 8.3, the dispute in respect of the relevant
item or items shall be submitted to expert determination
administered by and in accordance with the Rules for Binding
Expert Determination of the Australian Commercial Disputes Centre,
New South Sales ("ACDC") within 60 days of the dispute arising. In
the absence of manifest error, the parties agree to accept the
determination of the expert as final and binding. The expert shall
be a person agreed between the parties. ACDC will assist the
parties by providing a list of suggested experts. Failing
agreement, the expert shall be a person appointed by ACDC. BHP and
the relevant party agree to pay in the proportions determined by
ACDC the costs and expenses of the expert in connection with the
references. The expert will be appointed as an expert and not as
an arbitrator. The procedures for determination are to be decided
by the expert in their absolute discretion. BHP and the relevant
party must ensure that the terms of appointment of the expert
require them to make a determination in relation to the matters
the subject of the reference to them within 90 days of their
appointment.
8.5 Coal Tar Contract
On or before Completion BHP, the Company, Koppers Coal Tar and the
Purchaser will enter into a contract for BHP to supply and the Company
to purchase 100% of BHP's available Australian coal tar to the extent
that BHP continues to produce coal tar in Australia. The terms of the
Coal Tar Contract will be substantially the terms currently being
negotiated between the Company or Koppers Coal Tar and the integrated
steel division of BHP Steel and must include the following:
(a) there will be no naphthalene price adjustment;
(b) the provisions dealing with the relevant facilities at the
Steelworks Site will be made subject to and consistent with the
provisions set out in clause 8.3;
(c) the new prices contemplated by the draft agreement will apply from
1 September 1997;
(d) the supply agreement will be for a 12 year term with provision
for extension as currently negotiated;
(e) other operational issues that are currently being negotiated
locally will be finalised;
<PAGE>
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(f) the Company and the Purchaser must each guarantee the obligations
of Koppers Coal Tar under the Coal Tar Contract;
(g) BHP and the Purchaser must each use reasonable endeavours to
procure the form of the Coal Tar Contract is agreed and settled
between the relevant parties as soon as possible after execution
of this agreement.
8.6 Insurance
The Purchaser acknowledges that it will be necessary following
Completion for the Company to effect new insurance in respect of its
assets and liability rather than rely on any BHP, umbrella or
sponsored policies currently in place.
8.7 Superannuation
The Purchaser also acknowledges that the Company will be required to
establish or nominate a superannuation fund or funds in accordance
with the provisions contemplated by clause 9 on or before Completion.
8.8 Other Separation Items
The parties recognise that since the time of the establishment of the
Company in 1967 there have been many dealings and arrangements between
BHP and its Related Bodies Corporate and the Company and its Related
Bodies Corporate. The parties will work together in good faith to
adjust and vary those commercial arrangements so, where appropriate,
they are withdrawn or otherwise they are placed on commercial arms
length terms and in doing so will use reasonable endeavours to
minimise the disruption to the businesses of the Company and its
Related Bodies Corporate. Without limiting the generality of the
foregoing, BGP will withdraw the letter of comfort it has currently
provided in relation to the borrowing facilities of the Company.
8.9 SEEP & KEEPP
The Purchaser acknowledges that the Company will be solely responsible
for the ongoing management or dismantling of the existing employee
incentive schemes that operate in relation to the Company and its
Related Bodies Corporate.
8.10 No other responsibilities
(a) The Purchaser and the Company acknowledge and agree that except
as set out in this agreement or pursuant to any other express
written agreements, neither BHP nor any Associated Person will
have any obligations, liabilities or responsibilities for or in
connection with the operation or business of the Company or any
of its Related Bodies Corporate to the Purchaser, the Company or
any of its Related Bodies Corporate at any time on or after
Completion.
(b) Without limiting the generality of clause 8.10(a), neither BHP
nor any Associated Person will have any obligation, liability or
responsibility to the Purchaser, the Company or any of its
Related Bodies Corporate in connection with any contamination of
land or pollution of the environment which has occurred in the
conduct of the business or operations of the Company or any of
its Related Bodies Corporate and neither BHP nor any Associated
Person will have any obligations, liabilities or responsibilities
to the Purchaser, the
<PAGE>
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Company or any of its Related Bodies Corporate in connection with
the clean-up or decontamination of any such pollution or
contamination.
(c) The Company must indemnify BHP and the Associated Persons for all
losses, costs and expenses or other moneys payable by them in
connection with any environmental claims (including any claims
for clean-up or decontamination of land) brought against BHP or
any Associated Person in connection with the operations or
businesses of the Company or any its Related Bodies Corporate and
arising by reason of the Vendor's shareholding in the Company or
by reason of the appointment of any Associated Person as a
director or officer of the Company or any of its Related Bodies
Corporate at any time prior to Completion. For the purposes of
clause 8.10(a), (b) or (c) "Associated Persons" does not include
Mallesons Stephen Jaques or Centaurus Corporate Finance Pty
Limited.
(d) The Purchaser and the Company agree to be bound by the following
provisions for the period of 4 years following Completion:
(i) The total consolidated indebtedness of the Company and its
Related Bodies Corporate ("KAP Group") after netting off any
cash or bank deposits ("Net Debt") must not exceed
$100,000,000.
(ii) All borrowings or financial indebtedness of the KAP Group
must be on market terms.
(iii) All dealings between any member of the KAP Group, on the
one hand, and the Purchaser or any of the Purchaser's
Related Bodies Corporate other than a member of the KAP
Group ("KII Group"), on the other, must be on arms length
terms.
(iv) The assets and undertakings of the KAP Group must be
maintained with the Company as the holding company and the
Purchaser and the Company must use reasonable endeavours to
maintain and enhance the value of those assets and
undertakings.
(v) Any sale of assets by any member of the KAP Group must be
for fair market value with the proceeds used either to
reduce Net Debt or for reinvestment in the assets and
undertakings of the KAP Group.
(e) The parties acknowledge that nothing in the clause 8.10 imposes
any obligation on the part of the Purchaser to indemnify BHP or
any Associated Person in respect of any claim brought against BHP
or any Associated Person in respect of any claim brought against
BHP or any Associated Person whether such claim is brought in
respect of any environmental matter (including any claim for
clean-up or decontamination of land) or in respect of any other
matter, fact or circumstance whatsoever.
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8.11 Override clause
To the extent that the provisions of any other arrangements or
agreements between the Company or any of its Related Bodies Corporate
and BHP or any of its Related Bodies Corporate are inconsistent with
any of the provisions of this agreement, the provisions of this
agreement prevail and the Company and BHP must procure that those
arrangements or agreements are amended to reflect the relevant
provisions of this agreement but must do so in accordance with clause
8.8.
9 Superannuation
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9.1 In this clause 9 the following words have these meanings:
Accumulation Fund means the accumulation fund described in Part 10 of
Division B of the governing rules of the BHP Superannuation Fund.
BHP Superannuation Fund means the superannuation fund established by
trust deed dated 1 July 1926.
Defined Benefit Fund means the defined benefit fund described in Part
1 of Division B of the governing rules of the BHP Superannuation Fund.
Payment Date means the date that is fourteen days after the date on
which the Transfer Value is calculated under clause 9.4.
Purchaser's Fund has the meaning given in clause 9.2.
Transfer Value is an amount equivalent to the aggregate of the normal
leaving service benefit vested in the Transferring Members on the
Completion Date being:
(a) for members of the Defined Benefit Fund, the Members' Reserves
as at the Completion Date as defined in Rule B1.2 of Part 1 of
Division B of the governing rules of the BHP Superannuation Fund,
and
(b) for members of the Accumulation Fund, the balance in their
accumulation accounts as at the Completion Date determined in
accordance with Part 10 of Division B of the governing rules of
the BHP Superannuation Fund.
Transferring Members means the employees of the Company or any
Subsidiary who are, at the Completion Date, members of the BHP
Superannuation Fund, and who accept the Purchaser's invitation to
transfer to the Purchaser's Fund under clause 9.2.
9.2 On, or before the Completion Date, the Purchaser must establish or
identify one or more superannuation funds ("Purchaser's Fund") which:
(a) are complying funds for the purposes of the Supervision Industry
(Supervision) Act 1933 and the Income Tax Assessment Act 1936;
and
(b) will provide benefits to the Transferring Members on terms which
are no less generous than those of the Accumulation Fund or the
Defined Benefit Fund (as the case may be) as at the Completion
Date,
<PAGE>
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and will invite employees of the Company or any Subsidiary who are
members of the BHP Superannuation Fund at the Completion Date to join
the Purchaser's Fund with effect from the Completion Date.
9.3 An employee of the Company or any Subsidiary who is, at the Completion
Date, a member of the BHP Superannuation Fund and who does not accept
the Purchaser's invitation to transfer to the Purchaser's Fund under
clause 9.2 will be dealt with in accordance with the governing rules
of the BHP Superannuation Fund.
9.4 As soon as practicable after the Completion Date, the Vendor must
cause the Transfer Value to be calculated as at that date in respect
of the Transferring Members.
9.5 The Vendor must do all things within its power to facilitate the
payment or transfer of the Transfer Value from the BHP Superannuation
Fund to the trustees of the Purchaser's Fund on the Payment Date
together with interest on that amount from the Completion Date to the
Payment Date at the BHP Superannuation Fund's interim rate as
determined in accordance with the governing rules of the BHP
Superannuation Fund in respect of that period. The Transfer Value must
be paid or transferred in cash unless the trustee of the BHP
Superannuation Fund and the trustees of the Purchaser's Fund agree
that other assets are to be transferred. The Transfer Value may be
paid or transferred in one or more instalments by the trustee of the
BHP Superannuation Fund at its discretion.
9.6 For the avoidance of doubt, the Purchaser and the Company acknowledge
that, in calculating the Transfer Value under clause 9.4, the Vendor
is not obliged to procure that the trustee of the BHP Superannuation
Fund pays or transfers to the trustee of the Purchaser's Fund any
element of surplus which may currently exist in relation to the BHP
Superannuation Fund.
9.7 The Vendor agrees to do all things within its power (subject to any
restrictions imposed by law) to ensure that, both before and after the
Completion Date, the Purchaser and the trustees of the Purchaser's
Fund and any actuary appointed by either of them are provided with all
records and information which they may reasonably require in order to
enable them to take over responsibility for and administer the
superannuation arrangements for Transferring Members. This obligation
extends to any records, information or systems which are recorded,
maintained or otherwise dependent on any computerised or similar
system or service.
10 Fallback Protections
- --------------------------------------------------------------------------------
10.1 If Completion does not occur by 31 January 1998, the Purchaser must
exercise reasonable endeavours to support an initial public offering
of shares in the Company in Australia within the shortest practicable
timeframe should BHP indicate to the Purchaser that it wishes to
implement such a public offering of shares.
10.2 Prior to Completion and, if Completion does not occur prior to 31
January 1998, so long as the Vendor remains a shareholder in the
Company the Purchaser agrees:
(a) except for the redemption or repurchase of management stock prior
to 31 December 1998 in accordance with the provisions of the KII
Stockholders' Agreement and except as expressly contemplated by
clause 7, the Purchaser will not buy back shares from or redeem
shares of or facilitate or in any way assist the exit of any
stockholder in the Purchaser including Saratoga;
<PAGE>
15
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(b) if any stockholder in the Purchaser gives a sale notice pursuant
to the provisions of the KII Stockholders' Agreement, the
Purchaser must, at BHP's request, support the exercise by KAP
Investments of all or any pre-emptive rights it holds under the
KII Stockholders' Agreement by voting in the appropriate manner
or instructing its nominee director to vote in the appropriate
manner;
(c) if any person makes an offer to KAP Investments to purchase the
stock it holds in the Purchaser as contemplated by clause 2.4 of
the KII Stockholders' Agreement or if circumstances are such that
KAP Investments has rights it may exercise under clause 8.4 of
the KII Stockholders' Agreement, the Purchaser must, at BHP's
request, support the exercise by KAP Investments of any of its
rights arising under the KII Stockholder's Agreement by voting in
the appropriate manner or instructing its nominee directors to
vote in the appropriate manner.
(d) except with the consent of all its stockholders including KAP
Investments, the Purchaser must not issue any securities (or
rights or options to acquire any such securities) of any nature
having any equity participation or voting rights other than on a
pro rata basis among its stockholders from time to time;
(e) if the Purchaser does offer any new securities to its
stockholders in accordance with the provisions of paragraph
10.2(d), the Purchaser must, at BHP's request, support KAP
Investments taking up all or part of its entitlement to those
securities by voting in the appropriate manner or instructing its
nominee director to vote in the appropriate manner;
(f) subject to meeting redemption obligations in connection with
stock held by management which apply up until 31 December 1998
under the KII Stockholders' Agreement and subject to compliance
with banking covenants and meeting reasonable standards of
commercial prudence, the Purchaser must maximise the payment of
dividends to its stockholders;
(g) the Purchaser must co-operate with the Vendor and BHP to ensure
that all of the voting, control and other rights held by KAP
Investments in relation to the Purchaser arising either under the
KII Stockholders' Agreement or by reason of KAP Investments'
stockholding in the Purchaser (including, without limiting the
generality of the foregoing, the rights held by KAP Investments
to appoint a Director of the Purchaser) must be exercised at the
direction of BHP and the Vendor;
(h) the Purchaser must not agree to any variation in the KII
Stockholders' Agreement or any other constituent document
affecting the rights of KAP Investments as a stockholder in the
Purchaser including, without limitation, alter the corporate
structure of the Purchaser through merger, liquidation,
reorganisation or restructuring, without the prior consent of
BHP;
(i) the Purchaser must not incur indebtedness for borrowed money,
other than in the ordinary course of business, or guarantee
indebtedness, or make any loans, advances or contributions to any
third party, without the prior consent of BHP;
(j) the Purchaser must not take any actions to accelerate any
material existing indebtedness, except as is contemplated by this
agreement or the transactions contemplated hereby.
<PAGE>
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10.3 For the avoidance of doubt where reference is made in clause 10.2 to
the Purchaser "voting in the appropriate manner or instructing its
nominee directors to vote in the appropriate manner" the Purchaser
must ensure that it exercises whatever rights it has as a shareholder
in the Company so that the Company exercises its rights as the
holding company of KAP Investments in order to ensure KAP Investments
exercises its respective rights in the manner requested by BHP.
11 Warranties & representations
- --------------------------------------------------------------------------------
11.1 The Vendor and BHP represent and warrant to the Purchaser that each of
following statements is accurate on the date of this agreement:
(a) The Vendor is the registered holder and beneficial owner of the
Shares.
(b) There are no mortgages, charges, pledges, liens, encumbrances or
other security interests over or affecting the Shares.
(c) The Vendor has the power to enter into and perform this agreement
and has obtained all necessary consents to enable it to do so.
(d) The entry into and performance of this agreement by the Vendor
does not constitute a breach of any obligation (including any
statutory, contractual or fiduciary obligation), or default under
any agreement or undertaking, by which the Vendor is bound.
(e) No voluntary arrangement has been proposed or reached with any
creditors of the Vendor. The Vendor is able to pay its debts as
and when they fall due.
(f) No meeting has been convened or resolution proposed, or petition
presented, and no order has been made, for the winding-up of the
Vendor. No voluntary arrangement has been proposed or reached
with any creditors of the Vendor. The Vendor is able to pay its
debts as and when they fall due.
(g) There are no options or agreements (whether exercisable now or in
the future and whether contingent or otherwise) which entitle any
person to create or require to be created any third party
interest of any nature whatsoever over any of the Shares.
11.2 Each of the parties to this agreement represents and warrants to each
other that they have the relevant power required to enter into and
perform this agreement and they have obtained all necessary consents
and authorities to enable them to do so (other than the consents and
authorisations referred to in clauses 4 and 5.3(a)). Each party
further represents and warrants to each other that the entering into
and performance of this agreement by them does not constitute a breach
of any obligation (including any statutory, contractual or fiduciary
obligation) or the fault by them under any agreement or undertaking by
which they are bound.
11.3 The Purchaser, the Company and Continental Carbon each acknowledge
that in entering into this Agreement they have relied and will rely
entirely on their own enquiries in relation to the affairs of the
Company and its Related Bodies Corporate and, without limitation, they
have not relied on and will not rely on either:
(a) any representation or warranty that are express or implied,
written, oral, collateral, statutory or otherwise (including,
without limitation, under Part 5 of the Trade Practices Act
1974, the Fair Trading Act of the various Australian
<PAGE>
17
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states and territories and the Corporations Law) as to the
affairs of the Company and its Related Bodies Corporate or their
prospects, from any Associated Person, or
(b) any information in any way relating to the affairs of the Company
or its Related Bodies Corporate or their prospects disclosed to
the Purchaser or any of its officers, employees, agents or
advisers by any Associated Person.
11.4 The Vendor and BHP indemnifies the Purchaser against all liability or
loss arising directly or indirectly from, and any costs, charges and
expenses incurred in connection with, any inaccuracy in or breach of
any of the Warranties given by either of them.
12 Costs and stamp duty
- --------------------------------------------------------------------------------
12.1 Each party agrees to bear their own legal and other costs and expenses
in connection with, the preparation, execution and completion of this
agreement and of other related documentation, except for stamp duty.
12.2 The Purchaser agrees to bear all stamp duty payable or assessed in
connection with this agreement and the transfer of the Shares to the
Purchaser.
13 Notices
- --------------------------------------------------------------------------------
13.1 A notice, approval, consent or other communication in connection with
this agreement:
(a) must be in writing;
(b) must be marked for the attention as shown below; and
(c) must be left at the address of the addressee, or sent by prepaid
ordinary post (airmail if posted to or from a place outside
Australia) to the address of the addressee or sent by facsimile
to the facsimile number of the addressee which is specified in
this clause or if the addressee notifies another address or
facsimile number then to that address or facsimile number.
The address and facsimile number of each party is:
Vendor
Attention: Company Secretary
Address: Level 48, 600 Bourke Street
Melbourne, Victoria
Facsimile: 61 3 9609 3946
BHP
Attention: Company Secretary
Address: Level 48, 600 Bourke Street,
Melbourne, Victoria
Facsimile: 61 3 9609 3946
Purchaser
Attention: Chief Executive Officer
Address: 436 Seventh Avenue
Pittsburgh, Pennsylvania
<PAGE>
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Facsimile: 0015 1 412 227 2333
13.2 A notice, approval, consent or other communication takes effect from
the time it is received unless a later time is specified in it.
13.3 A letter or facsimile is taken to be received:
(a) in the case of a posted letter, on the third (seventh, if posted
to or from a place outside Australia) day after posting; and
(b) in the case of facsimile, on production of a transmission report
by the machine from which the facsimile was sent which indicates
that the facsimile was sent in its entirety to the facsimile
number of the recipient.
14 Miscellaneous
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Exercise of rights
14.1 A party may exercise a right, power or remedy at its discretion, and
separately or concurrently with another right, power or remedy. A
single or partial exercise of a right, power or remedy by a party does
not prevent a further exercise of that or of any other right, power or
remedy. Failure by a party to exercise or delay in exercising a right,
power or remedy does not prevent its exercise.
Waiver and variation
14.2 A provision of or a right created under this agreement may not be:
(a) waived except in writing signed by the party granting the waiver;
or
(b) varied except in writing signed by the parties.
No merger
14.3 The Warranties in this agreement do not merge on Completion.
Survival of indemnities
14.4 Each indemnity in this agreement is a continuing obligation, separate
and independent from the other obligations of the parties and survives
termination of this agreement.
Enforcement of indemnities
14.5 It is not necessary for a party to incur expense or make payment
before enforcing a right of indemnity conferred by this agreement.
Further assurances
14.6 Each party agrees, at its own expense, on the request of any other
party, to do everything reasonably necessary to give effect to this
agreement and the transactions contemplated by it (including the
execution of documents) and to use all reasonable endeavours to cause
relevant third parties to do likewise.
Publicity
14.7 A party may not make press or other announcements or releases relating
to this agreement and the transactions the subject of this agreement
without the approval of the other parties to the form and manner of
the announcement or release unless that announcement or release is
required to be made by law or by a stock exchange. The parties must
consult with each other and co-ordinate any Stock Exchange
announcements or other release they are required to make by law or
by reason of Stock Exchange Listing Rules.
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Time of the essence
14.8 Time is of the essence of this agreement in respect of any date or
period determined under this agreement.
Entire agreement
14.9 This agreement constitutes the entire agreement of the parties about
its subject matter and any previous agreements, understandings and
negotiations on that subject matter cease to have any effect.
15 Governing law, jurisdiction and service of process
- --------------------------------------------------------------------------------
15.1 This agreement and the transactions contemplated by this agreement are
governed by the law in force in Victoria.
15.2 Each party irrevocably and unconditionally submits to the exclusive
jurisdiction of the courts of Victoria and courts of appeal from them
for determining any dispute concerning this agreement or the
transactions contemplated by this agreement. Each party waives any
right it has to object to an action being brought in those courts, to
claim that the action has been brought in an inconvenient forum, or to
claim that those courts do not have jurisdiction.
15.3 Without preventing any other mode of service, any document in an
action (including, but not limited to, any writ of summons or other
originating process or any third or other party notice) may be served
on any party by being delivered to or left for that party at its
address for service of notices under clause 13. In addition, the
Purchaser nominates Baker & McKenzie, solicitors, Melbourne as its
agent for the acceptance of service of process.
16 Partial execution
- --------------------------------------------------------------------------------
16.1 The parties acknowledge that on and from the date of execution of this
agreement by each of the Vendor, the Purchaser and BHP, this agreement
is binding between those parties and they must each procure entry into
this agreement by the Company, Continental Carbon and KAP Investments.
17 Counterparts
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17.1 This agreement may be executed in, and consist of, a number of
counterparts. All counterparts (including executed counterparts
received by facsimile) taken together constitute one and the same
instrument.
EXECUTED as an agreement.
<PAGE>
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SIGNED by Geoffrey Michael Walsh )
as authorised representative for )
BHP NOMINEES NO. 3 PTY LTD )
(ACN 006 528 678) in the )
presence of: )
)
)
/s/ John Atkin )
.................................. )
Signature of witness )
)
)
John Atkin ) /s/ G. M. Walsh
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) signatory warrants that the signatory
) is duly authorised to execute this
525 Collins St, Melbourne ) agreement on behalf of BHP NOMINEES
.................................. ) No. 3 PTY LTD
Address of witness )
)
)
Solicitor )
.................................. )
Occupation of witness )
)
)
)
SIGNED by Geoffrey Michael Walsh )
as authorised representative for )
THE BROKEN HILL PROPRIETARY )
COMPANY LIMITED (ACN 004 028 )
007 in the presence of: )
)
)
/s/ John Atkin )
.................................. )
Signature of witness )
)
)
John Atkin ) /s/ G. M. Walsh
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) signatory warrants that the signatory
) is duly authorised to execute this
525 Collins St, Melbourne ) agreement on behalf of THE BROKEN
.................................. ) HILL PROPRIETARY COMPANY LIMITED
Address of witness )
)
)
Solicitor )
.................................. )
Occupation of witness )
<PAGE>
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SIGNED by )
as authorised representative for )
KOPPERS INDUSTRIES, INC. in the )
presence of: )
)
)
/s/ R. D. Collins )
.................................. )
Signature of witness )
)
)
R. D. Collins ) /s/ R. K. Wagner
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) signatory warrants that the signatory
) is duly authorised to execute this
436 Seventh Ave. ) agreement on behalf of KOPPERS
.................................. ) INDUSTRIES, INC.
Address of witness )
)
)
V.P. and Secretary )
.................................. )
Occupation of witness )
)
)
)
SIGNED by )
as authorised representative for )
KOPPERS AUSTRALIA PTY )
LIMITED (ACN 000 566 629) )
in the presence of: )
)
)
)
.................................. )
Signature of witness )
)
)
)
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) signatory warrants that the signatory
) is duly authorised to execute this
) agreement on behalf of KOPPERS
.................................. ) AUSTRALIA PTY LIMITED
Address of witness )
)
)
)
.................................. )
Occupation of witness )
<PAGE>
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SIGNED by )
as authorised representative for )
KOPPERS INDUSTRIES, INC. in the )
presence of: )
)
)
)
.................................. )
Signature of witness )
)
)
)
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) signatory warrants that the signatory
) is duly authorised to execute this
) agreement on behalf of KOPPERS
.................................. ) INDUSTRIES, INC.
Address of witness )
)
)
)
.................................. )
Occupation of witness )
)
)
)
SIGNED by Brooks Wilson )
as authorised representative for )
KOPPERS AUSTRALIA PTY )
LIMITED (ACN 000 566 629) )
in the presence of: )
)
)
/s/ A. Cherry )
.................................. )
Signature of witness )
)
)
Anne Cherry ) /s/ Brooks C. Wilson
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) signatory warrants that the signatory
) is duly authorised to execute this
43 Bay Rd. Waverton 2060 ) agreement on behalf of KOPPERS
.................................. ) AUSTRALIA PTY LIMITED
Address of witness )
)
)
Company Secretary )
.................................. )
Occupation of witness )
<PAGE>
22
- --------------------------------------------------------------------------------
SIGNED by Brooks Wilson )
as authorised representative for )
CONTINENTAL CARBON AUSTRALIA PTY )
LIMITED (ACN 000 486 966) in the )
presence of: )
)
)
/s/ A. Cherry )
.................................. )
Signature of witness )
)
)
Anne Cherry ) /s/ Brooks C. Wilson
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) signatory warrants that the signatory
) is duly authorised to execute this
43 Bay Rd. Waverton 2060 ) agreement on behalf of CONTINENTAL
.................................. ) CARBON AUSTRALIA PTY LIMITED
Address of witness )
)
)
Company Secretary )
.................................. )
Occupation of witness )
)
)
)
SIGNED by )
as authorised representative for )
KAP INVESTMENTS, INC. in the )
presence of: )
)
)
)
.................................. )
Signature of witness )
)
)
)
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) signatory warrants that the signatory
) is duly authorised to execute this
) agreement on behalf of KAP
.................................. ) INVESTMENTS, INC.
Address of witness )
)
)
)
.................................. )
Occupation of witness )
<PAGE>
22
- --------------------------------------------------------------------------------
SIGNED by )
as authorised representative for )
CONTINENTAL CARBON AUSTRALIA PTY )
LIMITED (ACN 000 486 966) in the )
presence of: )
)
)
)
.................................. )
Signature of witness )
)
)
)
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) signatory warrants that the signatory
) is duly authorised to execute this
) agreement on behalf of CONTINENTAL
.................................. ) CARBON AUSTRALIA PTY LIMITED
Address of witness )
)
)
)
.................................. )
Occupation of witness )
)
)
)
SIGNED by )
as authorised representative for )
KAP INVESTMENTS, INC. in the )
presence of: )
)
)
/s/ R. D. Collins )
.................................. )
Signature of witness )
)
)
R. D. Collins ) /s/ R. K. Wagner
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) signatory warrants that the signatory
) is duly authorised to execute this
436 Seventh Ave. ) agreement on behalf of KAP
.................................. ) INVESTMENTS, INC.
Address of witness )
)
)
V.P. and Secretary )
.................................. )
Occupation of witness )
<PAGE>
Exhibit 2.2
Dated 2 December 1997
VARIATION AGREEMENT
BHP NOMINEES INVESTMENTS
NO. 3 PTY LIMITED
("Vendor")
THE BROKEN HILL
PROPRIETARY COMPANY
LIMITED
("BHP")
KOPPERS INDUSTRIES, INC.
("Purchaser")
KOPPERS AUSTRALIA PTY
LIMITED ("Company")
CONTINENTAL CARBON
AUSTRALIA PTY LIMITED
("Continental Carbon")
KAP INVESTMENTS, INC.
("KAP Investments")
Mallesons Stephen Jaques
Solicitors
Rialto
525 Collins Street
Melbourne Vic 3000
Telephone (613) 9643 4000
Fax (613) 0643-5999
DX ICI Melbourne
Ref RPL JA
MEL CORP/029097.01
<PAGE>
VARIATION AGREEMENT
Date: 2 December 1997
Parties: BHP NOMINEES INVESTMENTS NO. 3 PTY LIMITED (ACN
006 528 678) having its registered office at 600 Bourke Street,
Melbourne, Victoria, 3000 ("Vendor")
THE BROKEN HILL PROPRIETARY COMPANY LIMITED
(ACN 004 028 077) having its registered office at 600 Bourke
Street, Melbourne, Victoria, 3000 ("BHP")
KOPPERS INDUSTRIES, INC. of 436 Seventh Avenue, Pittsburgh,
Pennsylvania ("Purchaser")
KOPPERS AUSTRALIA PTY LIMITED (ACN 000 566 629) having its
registered office at 15 Blue Street, North Sydney ("Company")
CONTINENTAL CARBON AUSTRALIA PTY LIMITED
(ACN 000 486 966) having its registered office at 15 Blue
Street, North Sydney ("Continental Carbon")
KAP INVESTMENTS, INC. a Delaware corporation ("KAP
Investments")
Recitals:
A. BHP, the Vendor, the Purchaser, the Company, Continental Carbon
and KAP Investments are each party to an Agreement for Sale of
Shares dated 8 October 1997 under which the Vendor agreed to
sell and the Purchaser agreed to purchase, the whole of the
Vendor's interest in the Company, being 6,187,500 A Class
shares of $1.00 each in the capital of the Company ("Share Sale
Agreement")
B. The parties wish to vary the provisions of the Share Sale
Agreement in accordance with this agreement.
Operative provisions:
1 PURPOSE AND INTERPRETATION
- --------------------------------------------------------------------------------
1.1 This agreement sets out the terms and conditions on which the
parties agree to vary the Share Sale Agreement.
1.2 Unless otherwise defined in this agreement, capitalised terms
used in this agreement shall have the meanings given to them
in the Share Sale Agreement.
1.3 In this agreement unless the contrary intention appears
(a) the singular includes the plural and vice versa; and
(b) a reference to an agreement or another instrument
includes any variation or replacement of either of them;
and
<PAGE>
2
- --------------------------------------------------------------------------------
(c) a reference to a statute, ordinance, code or other law
includes regulations and other instruments under it and
consolidations, amendments, re-enactments or
replacements of any of them; and
(d) the word person includes a firm, body corporate,
unincorporated association or an authority, and
(e) a reference to a person includes the person's
executors, administrators, successors, substitutes
(including, without limitation, persons taking by
novation), and assigns.
1.4 Headings are included for convenience and do not affect the
interpretation of this agreement.
2 VARIATION
- --------------------------------------------------------------------------------
2.1 The parties agree that the Share Sale Agreement shall be
varied in the manner set out in the Schedule. The variations
effected by this agreement shall be deemed to have taken
effect on and from the date of completion of the Share Sale
Agreement ("Effective Date").
2.2 The Share Sale Agreement shall be read and construed and
given full force and effect on and from the Effective Date as
if the amendments set out in the Schedule were made to the
Share Sale Agreement.
2.3 In all respects other than as set out in clauses 2.1 and 2.2,
the parties expressly confirm and ratify the terms of the
Share Sale Agreement.
3. Counterparts
- --------------------------------------------------------------------------------
3.1 This agreement may be executed in, and consist of, a number
of counterparts. All counterparts (including executed
counterparts received by facsimile) taken together constitute
one and the same instrument.
EXECUTED as an agreement.
<PAGE>
3
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Schedule
- --------------------------------------------------------------------------------
1 Rectification of name
1.1 Each reference to "BHP Nominees No. 3 Pty. Ltd (ACN 006 528 678)" and the
"Vendor" in the Share Sale Agreement, including without limitation the
references to "BHP" Nominees No. 3 Pty Ltd" in the execution clause, first
page and front cover, is taken to be a reference to "BHP Nominees
Investments No. 3 Pty Limited (ACN 006 528 678)"
2 Variations to clause 8.3
2.1 Amendment to clause 8.3 by inserting:
"(f) For the avoidance of doubt, where the Company makes a claim for one
or more items under this clause 8.3, Koppers Coal Tar is not
entitled to make a claim for the same item or items under clause 12
of the Coal Tar Contract (and vice versa), and BHP's aggregate
maximum liability under clause 12 of the Coal Tar Contract and
clause 8.3(c) of this agreement is A$9 million."
3 Variations to clause 8.4
3.1 Amendment to clause 8.4(a) by inserting the phrase "Koppers Coal Tar"
after the words "Continental Carbon", and inserting the words "of this
agreement or clause 12 of the Coal Tar Contract" after the words "clauses
8.2 or 8.3".
3.2 Amendment to clause 8.4(b) by inserting the phrase "or Koppers Coal Tar"
after the words "the Company" wherever occurring, and inserting the words
"of this agreement or clause 12 of the Coal Tar Contract" after the phrase
"clauses 8.2 or 8.3" wherever occurring.
3.3 Amendment to clause 8.4(c) by inserting the phrase "or Koppers Coal Tar"
after the words "the Company", and inserting the phrase "of this agreement
or clause 12 of the Coal Tar Contract" after the words "clauses 8.2 or
8.3".
3.4 Amendment to clause 8.4(d) by inserting the phrase "of this agreement or
clause 12 of the Coal Tar Contract" after the phrase "clauses 8.2 or 8.3"
wherever occurring.
4 Variations to clause 8.5
4.1 Amendment to clause 8.5(d) by substituting for the existing words "12
year term" the words "10 year term".
5 Variations to clause 8.11
5.1 Amendment to clause 8.11 by inserting the words "(other than the Coal Tar
Contract)" after the words "Bodies Corporate" second appearing and
deleting after the words "are amended" the words "on or prior to
Completion".
6 Superannuation
6.1 Amendment to clause 9.1 by inserting the words "or such later date agreed
between the Vendor and the Purchaser" after the words "clause 9.4" in the
definition of "Payment Date".
<PAGE>
4
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6.2 Amendment to clause 9.1 by deleting the words "accept the Purchaser's
invitation to transfer to" in the definition of "Transferring Members" and
substituting for them the words "become members of
6.3 Amendment to clause 9.2 by inserting the words "unless the Purchaser's
Fund is a successor fund as defined in the Superannuation Industry
(Supervision) Regulations, in which case the Purchaser must do all things
within its power to cause the employees to join the Purchaser's Fund with
effect from the Completion Date" after the words "Completion Date" fourth
appearing.
6.4 Amendment to clause 9.3 by deleting the words "accept the Purchaser's
invitation to transfer to" and substituting for them the word "join".
<PAGE>
5
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Execution page
- --------------------------------------------------------------------------------
SIGNED by )
as attorney for BHP NOMINEES )
INVESTMENTS NO. 3 PTY )
LIMITED (ACN 006 628 678) under )
power of attorney dated 1 October )
1997 in the presence of: )
)
)
)
.................................. )
Signature of witness )
)
)
) /s/ G. M. Walsh
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) attorney states that the attorney
) has received no notice of revocation
525 Collins Street Melbourne ) of the power of attorney
.................................. )
Address of witness )
)
)
Lawyer )
.................................. )
Occupation of witness )
)
)
SIGNED by )
as attorney for THE BROKEN HILL )
PROPRIETARY COMPANY )
LIMITED (ACN 004 028 077) under )
power of attorney dated 1 October )
1997 in the presence of: )
)
)
)
.................................. )
Signature of witness )
)
)
) /s/ G. M. Walsh
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) attorney states that the attorney
) has received no notice of revocation
525 Collins St. Melbourne ) of the power of attorney
.................................. )
Address of witness )
)
)
Lawyer )
.................................. )
Occupation of witness )
<PAGE>
6
- --------------------------------------------------------------------------------
SIGNED by Brooks C. Wilson )
as attorney for KOPPERS )
INDUSTRIES, INC. under power of )
attorney dated 1 Dec 1997 in the )
presence of: )
)
)
/s/ A. Cherry )
.................................. )
Signature of witness )
)
)
Anne Cherry ) /s/ Brooks C. Wilson
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) attorney states that the attorney
) has received no notice of revocation
43 Bay Rd., Waverton 2060 ) of the power of attorney
.................................. )
Address of witness )
)
)
Company Secretary )
.................................. )
Occupation of witness )
)
)
SIGNED by Brooks C. Wilson )
as attorney for KOPPERS AUSTRALIA )
PTY LIMITED (ACN 000 566 629) )
under power of attorney dated 2 Dec )
1997 in the presence of: )
)
)
/s/ A. Cherry )
.................................. )
Signature of witness )
)
)
Anne Cherry ) /s/ Brooks C. Wilson
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) attorney states that the attorney
) has received no notice of revocation
43 Bay Rd., Waverton 2060 ) of the power of attorney
.................................. )
Address of witness )
)
)
Company Secretary )
.................................. )
Occupation of witness )
<PAGE>
7
- --------------------------------------------------------------------------------
SIGNED by Brooks C. Wilson )
as attorney for CONTINENTAL )
CARBON AUSTRALIA PTY )
LIMITED (ACN 000 486 966) under )
power of attorney dated 2 Dec 1997 )
in the presence of: )
)
)
/s/ A. Cherry )
.................................. )
Signature of witness )
)
)
Anne Cherry ) /s/ Brooks C. Wilson
.................................. ) ....................................
Name of witness (block letters) ) By executing this agreement the
) attorney states that the attorney
) has received no notice of revocation
43 Bay Rd., Waverton 2060 ) of the power of attorney
.................................. )
Address of witness )
)
)
Company Secretary )
.................................. )
Occupation of witness )
)
)
SIGNED by Brooks C. Wilson )
as attorney for KAP INVESTMENTS, )
INC. in the presence of: )
)
)
/s/ A. Cherry )
.................................. )
Signature of witness )
)
)
Anne Cherry ) /s/ Brooks C. Wilson
.................................. ) ....................................
Name of witness (block letters) )
)
)
43 Bay Rd., Waverton 2060 )
.................................. )
Address of witness )
)
)
Company Secretary )
.................................. )
Occupation of witness )
