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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT to SCHEDULE 13G)
Ashland Coal, Inc.
(Name of issuer)
Common Stock
(Title of class of securities)
043906 10 6
(CUSIP number)
Thomas L. Feazell
Senior Vice President, General Counsel and Secretary
Ashland Oil, Inc.
1000 Ashland Drive
Russell, KY 41169
(606) 329-3333
(Name, address and telephone number of person
authorized to receive notices and communications)
December 6, 1994
(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this Schedule
13D, and is filing this schedule because of Rule 13d-1(b)(3) or (4),
check the following box ____.
Check the following box if a fee is being paid with the
statement. ____ (A fee is not required only if the reporting
person: (1) has a previous statement on file reporting beneficial
ownership of more than five percent of the class of securities
described in Item 1; and (2) has filed no amendment subsequent thereto
reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Page 2 of 7 pages
CUSIP No. 043906 10 6 13D
1 NAME OF REPORTING PERSONS Ashland Oil, Inc.
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
61-0122250
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)
N/A (b)
3 SEC USE ONLY
4 SOURCE OF FUNDS 00 (See Item 3)
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Kentucky
NUMBER OF 7 SOLE VOTING POWER
SHARES 9,823,727 shares of Common Stock*
BENEFICIALLY (See Items 1 and 5)
OWNED BY
EACH 8 SHARED VOTING POWER
REPORTING 0
PERSON WITH
9 SOLE DISPOSITIVE POWER
9,823,727 shares of Common Stock*
(See Items 1 and 5)
10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
9,823,727 shares of Common Stock* (See Items 1 and 5)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
53.7% of the shares of Common Stock* (See Items 1 and 5)
Page 3 of 7
14 TYPE OF REPORTING PERSON
CO
* Includes shares of Common Stock obtainable through the exercise
of the Put and Call Option for 150 shares of Class B Preferred
Stock and the subsequent conversion of the Class B Preferred
Stock into Common Stock before August 18, 1998.
Page 4 of 7 pages
Securities and Exchange Commission
Washington, D.C. 20549
Schedule 13D
Item 1. Security and Issuer
Ashland Oil, Inc. ("Ashland") currently owns 7,071,827 shares of
Common Stock ("Common Stock"), par value $.01 per share, of Ashland
Coal, Inc. ("Ashland Coal"), a Delaware corporation. Pursuant to a
Put and Call Agreement (the "Put and Call Agreement") by and between
Ashland and Saarbergwerke AG ("Saarberg") which is attached hereto as
Exhibit A, Saarberg granted Ashland the option to purchase 150 shares
of Ashland Coal Class B Preferred Stock (the "Class B Preferred")
owned by Saarberg (hereinafter the "Call Option") and Ashland granted
Saarberg the option to require Ashland to purchase the Class B
Preferred (hereinafter the "Put Option"). These options are
exercisable during certain periods in February 1995 and are subject to
a number of conditions, including appropriate governmental approvals.
Pursuant to a Restated Shareholders Agreement (the "Shareholders
Agreement") among Ashland, Saarberg and Carboex International, Inc.
("Carboex") and Ashland Coal which is attached hereto as Exhibit B,
Carboex has a right of first refusal to purchase its Proportionate
Percentage (as such term is defined in the Shareholders Agreement) of
the Class B Preferred. Carboex's Proportionate Percentage of the
Class B Preferred is 20.6%, or 31 shares. In addition, the
Shareholders Agreement requires Carboex's consent to the sale of the
Class B Preferred, which consent cannot be unreasonably withheld.
Each share of Class B Preferred is presently convertible into
18,346 shares of Common Stock. This conversion rate increases to
19,596 shares of Common Stock on August 18, 1998 and to 20,846 shares
of Common Stock on August 18, 2003. The holders of the Class B
Preferred and Class C Preferred Stock, voting together as a class and
using cumulative voting, have the right to elect one director to
Ashland Coal's Board of Directors for every 63 shares of Class B
Preferred and Class C Preferred Stock held by such holders, provided
that the maximum number of directors which can be elected is three.
The principal executive offices of Ashland Coal are located at
2205 Fifth Street Road, Huntington, West Virginia 25771.
Page 5 of 7 pages
Item 2. Identity and Background
(a), (b) and (c) Ashland is a Kentucky corporation with its
principal executive offices located at 1000 Ashland Drive, Russell, KY
41169. Ashland is a large U.S. independent refiner and independent
crude oil gatherer and marketer; a regional retail marketer of
gasoline and merchandise; and a motor oil and automotive chemical
marketer in the U.S. and other countries.
In addition, Ashland is a large distributor of chemicals and
plastics in North America; a supplier of specialty chemicals
worldwide; a large U.S. highway contractor; and a producer of natural
gas and crude oil. Ashland also has equity positions in Ashland Coal
and Arch Mineral Corporation, both U.S. coal producers.
The executive officers and directors of Ashland and their
principal occupations and business addresses are shown on the attached
Schedule I. Each executive officer's position is with Ashland Oil,
Inc. or a division or subsidiary thereof. Each director's address is
Ashland Oil, Inc., c/o Office of the Secretary,1000 Ashland Drive,
Russell, KY 41169.
(d-e) During the last five years, neither Ashland nor any of
the persons listed in Schedule I hereto, has been (i) convicted in a
criminal proceeding (excluding traffic violations and similar
misdemeanors) or (ii) a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such
proceeding was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities
subject to, Federal or state securities laws or finding any violation
with respect to such laws.
(f) Each executive officer and director is a U.S. citizen.
Item 3. Source and Amount of Funds or Other Consideration
The purchase price of the Class B Preferred pursuant to the
exercise of either the Call Option or Put Option is $110,076,000. The
consideration for the purchase price will be provided from the
issuance of corporate debt.
Page 6 of 7 pages
Item 4. Purpose of Transaction
Ashland acquired the Call Option and granted the Put Option for
investment purposes. Ashland currently intends to exercise the Call
Option during the February 1995 exercise period. Currently, Ashland
does not intend to convert the Class B Preferred into Common Stock.
Pursuant to the Put & Call Agreement, upon the closing of the
purchase of the Class B Preferred, the two directors elected by
Saarberg to Ashland Coal's Board of Directors will resign. Ashland as
owner of the Class B Preferred intends to elect at least one
representative to Ashland Coal's Board and may choose to elect a
second representative to fill these vacancies (assuming Carboex does
not exercise its right of first refusal described in Item 1, in which
case, Ashland will presumably only elect one director).
Ashland has no current plans or proposals which relate to or
would result in: (a) the acquisition by any person of additional
securities of Ashland Coal except periodic reinvestment of dividends
under the Ashland Coal Dividend Reinvestment Plan, or the disposition
of securities of Ashland Coal, except as otherwise described herein;
(b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation involving Ashland Coal or any of its
subsidiaries; (c) a sale or transfer of a material amount of assets of
Ashland Coal or any of its subsidiaries; (d) any change in the present
Board of Directors or Management of Ashland Coal other than as
described above; (e) any material change in the present capitalization
or dividend policy of Ashland Coal; (f) any other material change in
Ashland Coal's business or corporate structure; (g) changes in Ashland
Coal's charter, by-laws or instruments corresponding thereto or other
actions which may impede the acquisition of control of Ashland Coal by
any person; (h) causing a class of securities of Ashland Coal to be
delisted from a national securities exchange or to cease to be
authorized to be quoted in an inter-dealer quotation system of a
registered national securities association; (i) a class of equity
securities of Ashland Coal becoming eligible for termination of
registration pursuant to Section 12(g)(4) of the Securities Exchange
Act of 1934; or (j) any action similar to any of those enumerated
above.
Page 7 of 7 pages
Item 5. Interest in Securities of the Issuer
Ashland currently owns 7,071,827 shares of Common Stock which
constitutes 38.6% of the voting power of Ashland Coal. Assuming the
exercise of either the Call Option or Put Option and the immediate
conversion of the 150 shares of Class B Preferred into Common Stock,
Ashland may be deemed to beneficially own a total of 9,823,727 shares
of Common Stock which would constitute a total of 53.7% of the voting
power of Ashland Coal. No transactions were effected with respect to
the Common Stock during the past 60 days by Ashland, its subsidiaries
and its executive officers, directors and affiliated persons other
than the Call and Put Option transaction described above and the
periodic reinvestment of dividends under the Ashland Coal Dividend
Reinvestment Plan.
Item 6. Contracts, Arrangements or Understandings with Respect to
Securities of the Issuer
See Item 1.
Item 7. Material to be Filed as Exhibits
A. Option Agreement
B. Shareholders Agreement
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is
true, complete and correct.
December 15, 1994
------------------------------
(Date)
/s/ Thomas L. Feazell
------------------------------
Thomas L. Feazell
Senior Vice President, General
Counsel and Secretary of
Ashland Oil, Inc.
Schedule I
DIRECTORS AND OFFICERS
OF
ASHLAND OIL, INC.
PRINCIPAL OCCUPATIONS AND BUSINESS ADDRESSES
DIRECTORS PRINCIPAL OCCUPATION*
--------------- ---------------------------------
Jack S. Blanton Chairman of the Board of Houston
Endowment, Inc., and Director and
President of Eddy Refining Company,
Houston, Texas
Thomas E. Bolger Chairman of the Executive Committee of
the Board of Bell Atlantic Corporation,
Philadelphia, Pennsylvania
Samuel C. Butler Partner of Cravath, Swaine & Moore,
Attorneys, New York, New York
Frank C. Carlucci Chairman of the Board of the Carlyle
Group, Washington, D.C.
Paul W. Chellgren President and Chief Operating Officer of
Ashland Oil, Inc., Ashland, Kentucky
James B. Farley Retired Chairman and Current Trustee of
Mutual of New York, New York
Edmund B. Managing Director of Woodmont
Fitzgerald Associates, Nashville, Tennessee
Ralph E. Gomory President of the Alfred P. Sloan
Foundation, New York, New York
John R. Hall Chairman of the Board of and Chief
Executive Officer of Ashland Oil, Inc.,
Ashland, Kentucky
Mannie L. Jackson Majority owner and Chairman of the
Harlem Globetrotters, International
Patrick F. Noonan Chairman of the Board and Chief
Executive Officer of The Conservation
Fund, Arlington, Virginia
DIRECTORS PRINCIPAL OCCUPATION*
--------------- ---------------------------------
Jane C. Pfeiffer Management Consultant, Greenwich,
Connecticut
James R. Rinehart Business and Labor Consultant, Hiram,
Ohio
Michael D. Rose Chairman of the Board of The Promus
Companies Incorporated, Memphis,
Tennessee
William L. Rouse, Investments, Lexington, Kentucky
Jr.
Dr. Robert B. Professor, Harvard Business School,
Stobaugh Boston, Massachusetts
James W. Oil and Gas Producer, Chairman of the
Vandeveer Board of Vantex Enterprises, Inc.,
Dallas, Texas
* For business addresses, see Item 2.
EXECUTIVE OFFICERS BUSINESS ADDRESS PRINCIPAL OCCUPATION
------------------ ------------------- -----------------------
John R. Hall P.O. Box 391 Chairman of the
Ashland, KY 41114 Board and Chief
Executive Officer
Paul W. Chellgren P. O. Box 391 President and
Ashland, KY 41114 Chief Operating
Officer
James R. Boyd P. O. Box 391 Senior Vice
Ashland, KY 41114 President and
Group Operating
Officer
John A. Brothers Ashland Chemical Senior Vice
Company, a President and
Division of Group Operating
Ashland Oil, Inc. Officer
P.O. Box 2219
Columbus, OH
43216
J. Marvin Quin P. O. Box 391 Senior Vice
Ashland, KY 41114 President and
Chief Financial
Officer
Thomas L. Feazell P. O. Box 391 Senior Vice
Ashland, KY 41114 President,
General Counsel
and Secretary
Robert E. Yancey, P. O. Box 391 Senior Vice
Jr. Ashland, KY 41114 President and
Group Operating
Officer;
President, Ashland
Petroleum Company,
a Division of
Ashland Oil, Inc.
Harry M. Zachem P. O. Box 391 Senior Vice
Ashland, KY 41114 President,
External Affairs
John D. Barr P. O. Box 14000 Senior Vice
Lexington, KY President;
40512 President, The
Valvoline Company
David J. D'Antoni Ashland Chemical Senior Vice
Company, a President;
Division of President, Ashland
Ashland Oil, Inc. Chemical Company,
P. O. Box 2219 a Division of
Columbus, OH Ashland Oil, Inc.
43216
EXECUTIVE OFFICERS BUSINESS ADDRESS PRINCIPAL OCCUPATION
------------------ ------------------- -----------------------
John F. Pettus P. O. Box 14000 Senior Vice
Lexington, KY President;
40512 President,
SuperAmerica
Group, a Division
of Ashland Oil,
Inc.
Charles F. Potts APAC, Inc. Senior Vice
3340 Peachtree President;
Rd., NE President, APAC,
Tower Place Inc.
Atlanta, GA 30326
G. Thomas 14701 St. Mary's Senior Vice
Wilkinson Lane President;
Houston, TX 77079 President, Ashland
Exploration, Inc.
John W. Dansby P. O. Box 391 Administrative
Ashland, KY 41114 Vice President;
Treasurer
Kenneth L. Aulen P. O. Box 391 Administrative
Ashland, KY 41114 Vice President;
Controller
Philip W. Block P. O. Box 391 Administrative
Ashland, KY 41114 Vice President
Fred E. Lutzeier P. O. Box 391 Auditor
Ashland, KY 41114
EXHIBIT A
PUT AND CALL AGREEMENT
THIS PUT AND CALL AGREEMENT, dated as of the 21st day of November,
1994 (the "Agreement"), is by and between Ashland Oil, Inc., a
Kentucky corporation ("Ashland"), and Saarbergwerke AG, a company
organized under the laws of the Federal Republic of Germany
("Saarberg").
RECITALS
WHEREAS, Saarberg is the owner of 150 shares of Class B Preferred
Stock (the "Shares") of Ashland Coal, Inc., a Delaware corporation
("Ashland Coal"); and
WHEREAS, Ashland and Saarberg desire to grant to each other the
options set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual benefits to be
derived herefrom, and other good and valuable consideration, Ashland
and Saarberg hereby agree as follows:
1. Grant of Options.
(a) The Put Option. Ashland hereby grants to Saarberg the
right and option, in Saarberg's sole discretion, to require
Ashland to purchase all of the Shares from Saarberg, on the terms
and subject to the conditions set forth herein (the "Put
Option").
(b) The Call Option. Saarberg hereby grants to Ashland the
right and option, in Ashland's sole discretion, to require
Saarberg to sell all of the Shares to Ashland or a subsidiary of
Ashland, on the terms and subject to the conditions set forth
herein (the "Call Option").
2. Exercise Period. The Call Option shall be exercisable by
Ashland only during the period beginning on February 1, 1995 and
ending at midnight in New York, New York on February 7, 1995. The Put
Option shall be exercisable by Saarberg only during the period
beginning February 22, 1995 and ending at midnight in New York, New
York on February 28, 1995. If neither Ashland nor Saarberg shall
exercise its Call Option or Put Option, respectively, then this
Agreement shall expire.
3. Exercise of the Options.
(a) The Put Option. The Put Option may be exercised by Saarberg
by delivery to Ashland of written notice of its intention to
exercise such option. The Put Option may be exercised only in
whole and not in part, subject to Section 4(e) below.
(b) The Call Option. The Call Option may be exercised by
Ashland by delivery to Saarberg of written notice of its intention
to exercise such option. The Call Option may be exercised only in
whole and not in part, subject to Section 4(e) below.
(c) Purchase Price. The purchase price of the Shares
pursuant to exercise of either the Put Option or the Call Option
shall be U.S. $110,076,000, subject to adjustment pursuant to
Section 4(e) below (the "Purchase Price").
4. Miscellaneous Option Provisions. The Put Option and the
Call Option shall each be subject to the following additional terms
and conditions:
-2-
page>
(a) Closing. The purchase and sale of the Shares shall occur
at such date, time and place as Saarberg and Ashland may agree,
but in the event of the failure to so agree, such purchase and
sale shall occur at the offices of Shearman & Sterling in New
York City no later than 5:00 p.m., Eastern Standard Time, on the
10th business day following receipt by Saarberg or by Ashland of
notice of exercise of the Put Option or the Call Option,
respectively, from the other party hereto (the date of such
purchase and sale hereinafter referred to as the "Closing Date");
provided that the Closing Date shall be extended as necessary to
permit the parties to obtain any and all governmental approvals
deemed reasonably necessary by either or both parties hereto.
Saarberg agrees that it will deliver to Carboex International,
Inc. ("Carboex") the Disposition Notice required by the Restated
Shareholders Agreement dated December 12, 1991, as amended
August 6, 1993 (the "Shareholders Agreement"), no later than two
business days following approval by Saarberg's Supervisory Board
of the execution, delivery and performance of this Agreement.
(b) Title to the Shares. Subject to the terms of the
Shareholders Agreement, Saarberg has good and marketable title to
the Shares free and clear of all pledges, liens, claims or
encumbrances; and upon delivery of the Shares and payment of the
Purchase Price therefor as herein contemplated, Ashland shall
receive good and marketable title to the Shares free and clear of
any pledge, lien, claim or encumbrance.
-3-
During the term of this
Agreement, Saarberg shall not convert the Shares into Common
Stock of Ashland Coal nor shall it sell, assign, convey or in any
way transfer to any other person or entity other than a Saarberg
Subsidiary (as hereinafter defined) any rights, title or interest
in or to the Shares or grant or otherwise allow to exist any
encumbrance on or with respect to the Shares. In the event that
the Shares are transferred to a Saarberg Subsidiary as provided
herein, Saarberg shall at the time of such transfer also assign
its rights and obligations hereunder to such Saarberg Subsidiary
pursuant to Section 8 of this Agreement, such Saarberg Subsidiary
shall assume such rights and obligations, and Saarberg shall
remain liable for the performance of all obligations of Saarberg
or the Saarberg Subsidiary hereunder.
(c) Payment of Purchase Price; Refund of Withholding Tax.
Upon the closing of the exercise of the Put Option or the Call
Option, the Purchase Price, less any required withholding, shall
be paid by Ashland to Saarberg by wire transfer in immediately
available funds to an account within the United States designated
by Saarberg in writing prior to the Closing Date. Ashland agrees
not to withhold tax provided that it has received, within 30 days
prior to the payment of the Purchase Price hereunder, a statement
issued by Ashland Coal described in Section 1.1445-2(c)(3) of the
Treasury Regulations certifying that the Shares are not a U.S.
real property interest (which statement Saarberg (and any
Saarberg Subsidiary to which this Agreement and the Shares
-4-
may have been assigned) and Ashland will request). If such statement
has not been so received (and if Saarberg determines to waive the
closing condition set forth in Section 7(h)), Ashland shall
withhold such tax as may be required for U.S. Federal income tax
purposes. If, however, an application for a withholding
certificate as described in Section 1.1445-1(c)(2) of the
Treasury Regulations has been submitted to the Internal Revenue
Service ("IRS") on or prior to the Closing Date, Ashland shall
not report and pay over the withheld amount to the IRS until
after the IRS's final determination with respect to the
application. If, as a result of receipt of a withholding
certificate or otherwise, Ashland shall no longer be obligated to
pay to the IRS any amount of the Purchase Price withheld for tax
purposes or Ashland shall receive a refund of any such amount
previously paid, Ashland shall pay promptly to Saarberg such
amount plus interest from the Closing Date until payment in full
at money market rates (except Ashland shall not be required to
pay interest for any period during which such amount was held by
the IRS).
(d) Failure to Sell or Buy; Specific Performance. In the
event the Put Option is exercised by Saarberg and Saarberg
thereafter fails to sell the Shares or Ashland thereafter fails
to purchase the Shares, or the Call Option is exercised by
Ashland and Ashland thereafter fails to purchase the Shares or
Saarberg thereafter fails to sell the Shares, in each case, in
accordance with the terms and conditions of this Agreement, either
-5-
party shall be entitled to obtain specific performance of
such option exercise, together with any other injunctive or other
equitable remedies as may be appropriate under the circumstances
and the payment of any damages, costs and expenses the injured
party shall incur as a result of or otherwise in connection with
such failure to perform (unless the failure to perform was caused
by governmental action or inaction, in which case the injured
party shall not be entitled to recover such damages, costs and
expenses), including, if applicable, all reasonable costs and
expenses (including, but not limited to, attorneys' fees)
incurred in obtaining judicial enforcement of these remedies.
The remedies available under this sub-paragraph shall also be
available in the event of a threatened breach by Saarberg or
Ashland of its obligations, should such obligations arise through
the exercise of the Put Option or the Call Option, respectively.
(e) Carboex Right of First Refusal and Consent. Saarberg and
Ashland recognize and acknowledge that Carboex has a right of
first refusal to purchase its Proportionate Percentage (as such
term is defined in the Shareholders Agreement) of the Shares
pursuant to the Shareholders Agreement. In addition, the
Shareholders Agreement requires Carboex's consent to the sale of
the Shares, which consent cannot be unreasonably withheld.
Saarberg and Ashland hereby agree that in the event Carboex
elects to exercise its right of first refusal under the
Shareholders Agreement, this Agreement shall remain in full force
and effect as to the Shares not purchased or to be purchased by
-6-
Carboex, and the Purchase Price shall be reduced proportionately
to reflect the reduction in the number of Shares being purchased
by Ashland. If, after notifying Saarberg of its intention to
purchase its Proportionate Percentage of the Shares, Carboex
fails to complete such purchase as provided in the Shareholders
Agreement, Ashland shall purchase and Saarberg shall sell such
Shares (at a second closing, if necessary) upon the terms and
conditions of this Agreement.
5. Proration of Dividends and Voting Rights.
(a) Ashland and Saarberg agree and acknowledge that any
dividend(s), whether in cash, stock, or other form, paid by
Ashland Coal on the Shares on or after the Closing Date shall be
prorated as of such date, irrespective of the record date
established for such dividend(s) and irrespective of the record
owner of such Shares on the record date such that (i) the amount
of such prorated dividends that Saarberg shall be entitled to
receive shall be determined by multiplying 95% of the total
dividends paid or to be paid with respect to the Shares by a
fraction, the numerator of which shall be equal to the number of
days from the payment date for the dividend payable immediately
preceding the dividend to be adjusted to the Closing Date and the
denominator of which shall be equal to the number of days from
the payment date for the dividend payable immediately preceding
the dividend to be adjusted to the payment date of the dividend
to be adjusted, and (ii) the amount of such prorated dividends
that Ashland shall be entitled to receive shall be
-7-
determined by multiplying 95% of the total dividends paid or to be
paid with respect to the Shares by a fraction, the numerator of
which shall be equal to the number of days from the Closing Date to
the payment date for the dividend to be adjusted and the denominator
of which shall be equal to the number of days from the payment
date for the dividend payable immediately preceding the dividend
to be adjusted to the payment date of the dividend to be
adjusted. Any prorated payment required to be made by Ashland or
Saarberg under this Section 5(a) shall be made by wire transfer
in immediately available funds to an account in the United States
designated by the recipient of such prorated payment within two
business days after receipt by Ashland or Saarberg of the
dividend payment giving rise to such prorated payment.
(b) If requested by Ashland, on and after the Closing Date,
Saarberg agrees to execute and deliver to Ashland an irrevocable
proxy granting to Ashland the right to vote the Shares.
6. Ashland Closing Conditions. If Saarberg exercises the Put
Option, or if Ashland exercises the Call Option, Ashland's obligation
to purchase the Shares for the Purchase Price shall be subject to the
fulfillment to Ashland's reasonable satisfaction of the following
conditions:
(a) On the Closing Date, Saarberg shall deliver to Ashland a
certificate or certificates for the Shares duly endorsed for
transfer or with appropriately executed stock powers attached;
-8-
(b) Saarberg hereby represents and warrants to Ashland, and
on the Closing Date shall represent and warrant that Saarberg
has full corporate power to make, and has taken all necessary
corporate action to authorize the execution, delivery and
performance of this Agreement and, subject to Carboex's right of
first refusal and the receipt of Carboex's consent, each as
referred to in Section 4(e) of this Agreement, the sale and
delivery of the Shares free and clear of all claims, liens,
encumbrances, charges and equities whatsoever and has full right,
power and authority to sell the Shares; provided, however, that
as of the date of this Agreement, Saarberg has not obtained the
approval of its Supervisory Board to the execution, delivery and
performance of this Agreement, and thus no representation or
warranty is hereby made as to such approval. However, it is
Saarberg's intention to seek such approval at the December 6,
1994 meeting of the Supervisory Board, and it is agreed that
receipt of such approval shall be a condition to this Agreement.
On the Closing Date, Saarberg shall represent and warrant to
Ashland that (i) all consents and approvals of governmental or
public authorities, agencies, courts and others necessary in
connection with the transactions contemplated by this Agreement
have been obtained, and (ii) there is no restriction on
Saarberg's right to sell and transfer the Shares. Saarberg shall
take all such actions as Ashland shall reasonably request to
assure that the foregoing representations and warranties are true
and correct on the Closing Date and shall deliver to
-9-
Ashland a certificate executed by the President or authorized Vice
President of Saarberg, dated the Closing Date, to this effect.
(c) On the Closing Date, Ashland shall have received an
opinion of counsel for Saarberg to the effect that (i) Saarberg
has full corporate power to make, and has taken all necessary
corporate action to authorize the execution, delivery and
performance of, this Agreement and the sale and delivery of the
Shares to Ashland, (ii) this Agreement constitutes a valid and
binding obligation of Saarberg, enforceable in accordance with
its terms, except as enforcement may be limited by bankruptcy,
insolvency, reorganization or other laws affecting generally the
enforcement of creditors' rights and except as the remedy of
specific performance and injunctive and other forms of equitable
relief may be subject to equitable defenses, (iii) approval of
such sale is not required by the stockholders of Saarberg, or if
such approval is required, it has been duly obtained, (iv) the
sale by Saarberg of the Shares will not result in the violation
of any terms of the charter or by-laws of Saarberg or of any
indenture, note or other agreement known to such counsel to which
Saarberg is a party or of any judgment, decree, order, law or
other governmental rule or regulation applicable to Saarberg, (v)
all consents and approvals of governmental or public authorities,
agencies, courts and others necessary in connection with the
transactions contemplated by this Agreement have been obtained,
and (vi) there is no restriction on Saarberg's right to sell and
transfer the Shares to Ashland.
-10-
(d) On the Closing Date, no court or other governmental body
or authority of competent jurisdiction shall have enacted,
issued, promulgated, enforced or entered any statute, rule,
regulation, executive order, decree, injunction or other order
(whether temporary, preliminary or permanent) which in effect
restricts, prevents or prohibits consummation of the transactions
contemplated by this Agreement, nor shall there be any actual or
threatened action or proceeding by any governmental body or
authority (not including Carboex) which shall seek to restrict,
prevent or prohibit consummation of the transactions contemplated
by this Agreement; provided that the party invoking this
condition shall have used its best reasonable efforts to have any
such order, action or proceeding vacated or terminated.
(e) On the Closing Date, Saarberg shall have delivered to
Ashland Coal resignation letters signed by its representatives on
the Ashland Coal Board of Directors.
(f) All waiting periods under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, and the rules and regulations
promulgated thereunder (the "HSR Act") applicable to the exercise
of the Call Option or Put Option, as the case may be, shall have
expired or been terminated.
7. Saarberg Closing Conditions. If Saarberg exercises the Put
Option, or if Ashland exercises the Call Option, Saarberg's obligation
to sell the Shares for the
-11-
Purchase Price shall be subject to the fulfillment to Saarberg's
reasonable satisfaction of the following conditions:
(a) On the Closing Date, Ashland shall pay the Purchase Price
to Saarberg as set forth in Section 4(c) of this Agreement.
(b) Ashland hereby represents and warrants to Saarberg, and
on the Closing Date shall represent and warrant that Ashland has
full corporate power to make, and has taken all necessary
corporate action to authorize the execution, delivery and
performance of this Agreement and the purchase of the Shares. On
the Closing Date, Ashland shall represent and warrant to Saarberg
that all consents and approvals of governmental or public
authorities, agencies, courts and others necessary in connection
with the transactions contemplated by this Agreement have been
obtained. Ashland shall take all such actions as Saarberg shall
reasonably request to assure that the foregoing representations
and warranties are true and correct on the Closing Date and shall
deliver to Saarberg a certificate executed by the President or
authorized Vice President of Ashland, dated the Closing Date, to
this effect.
(c) On the Closing Date, Saarberg shall have received an
opinion of counsel for Ashland to the effect that (i) Ashland has
full corporate power to make, and has taken all corporate action
to authorize, the execution, delivery and performance of this
Agreement and the purchase of the Shares, (ii) this Agreement
constitutes a valid and binding
-12-
obligation of Ashland, enforceable in accordance with its terms,
except as enforcement may be limited by bankruptcy, insolvency,
reorganization or other laws affecting generally the enforcement of
creditors' rights and except as the remedy of specific performance
and injunctive and other forms of equitable relief may be subject
to equitable defenses, (iii) approval of such purchase is not
required by the stockholders of Ashland, or if such approval is
required, it has been duly obtained, (iv) the purchase by Ashland
of the Shares will not result in the violation of any terms of the
charter or by-laws of Ashland or of any indenture, note or other
agreement known to such counsel to which Ashland is a party or of
any judgment, decree, order, law or other governmental rule or
regulation applicable to Ashland, and (v) all consents and
approvals of governmental or public authorities, agencies, courts
and others necessary in connection with the transactions
contemplated by this Agreement have been obtained.
(d) On the Closing Date, no court or other governmental body
or authority of competent jurisdiction shall have enacted,
issued, promulgated, enforced or entered any statute, rule,
regulation, executive order, decree, injunction or other order
(whether temporary, preliminary or permanent) which in effect
restricts, prevents or prohibits consummation of the transactions
contemplated by this Agreement, nor shall there be any actual or
threatened action or proceeding by any governmental body or
authority (not including Carboex) which shall seek
-13-
to restrict, prevent or prohibit consummation of the transactions
contemplated by this Agreement; provided that the party invoking this
condition shall have used its best reasonable efforts to have any
such order, action or proceeding vacated or terminated.
(e) On the Closing Date, Saarberg shall have received
pursuant to Section 5.4 of that certain Indemnity Agreement dated
September 21, 1981, as amended August 6, 1993 (the "Indemnity
Agreement") an instrument from Ashland releasing Saarberg from
all its obligations (or, if Carboex exercises its right to
purchase its Proportionate Percentage of the Shares,
proportionally reducing its obligations) to indemnify Ashland for
any Ashland Loss, as defined in the Indemnity Agreement, arising
on or after the Closing Date.
(f) On the Closing Date, Saarberg shall have received
Carboex's consent to the sale of the Shares as required by the
Shareholders Agreement.
(g) All waiting periods under the HSR Act applicable to the
exercise of the Call Option or Put Option, as the case may be,
shall have expired or been terminated.
(h) On or not more than 30 days before the Closing Date,
Saarberg and any Saarberg Subsidiary to which this Agreement
and the Shares may have been assigned shall have received a
statement addressed to it, issued by Ashland Coal, described in
-14-
Section 1.1445-2(c)(3) of the Treasury Regulations, certifying that
the Shares are not a U.S. real property interest.
8. Assignment and Transfer. This Agreement and the rights and
obligations hereunder may not be assigned or in any way transferred by
either party hereto and any such assignment or transfer shall be null
and void; provided, however, Ashland and Saarberg may assign and
transfer their rights and obligations hereunder to any corporation or
other business entity wholly owned by Ashland (an "Ashland
Subsidiary"), or Saarberg (a "Saarberg Subsidiary"), as the case may
be, and such Ashland Subsidiary or Saarberg Subsidiary may in turn
assign and transfer its rights and obligations hereunder to another
Ashland Subsidiary or Saarberg Subsidiary. Notwithstanding the
foregoing, in the event that Ashland or Saarberg shall assign this
Agreement and its rights and obligations hereunder to an Ashland
Subsidiary or Saarberg Subsidiary as provided above, Ashland or
Saarberg, as the case may be, shall remain liable for the performance
of its obligations hereunder.
9. Notices. Any notice pursuant to this Agreement by Saarberg
or by Ashland shall be in writing and may be given by personal
delivery, by mail or by telex or telecopy. Notice by mail shall be
made by air mail, return receipt requested, (a) if to Saarberg,
Saarbergwerke AG, P.O. Box 102652, D 66026 Saarbruecken, Federal
Republic of Germany, Attention: Michael Ziesler; and (b) if to
Ashland, Ashland Oil, Inc., 1000 Ashland Drive, Russell, KY 41169,
Attention: General Counsel. Any notice or other communication so
transmitted shall be deemed to have been given at the time of
delivery, in the case of a communication delivered personally; on the
business day following receipt of answerback or telecopy confirmation,
in the case of
-15-
a communication sent by telex or telecopy, respectively; or ten days
after mailing in the case of a communication sent by mail; provided,
however, that any notice of exercise of the Call Option or Put
Option shall be deemed given when received.
10. Limitation of Rights. This Agreement shall be for the sole
and exclusive benefit of Saarberg and Ashland, and nothing in this
Agreement shall be construed to give any person or corporation other
than Saarberg and Ashland (or a Saarberg Subsidiary or an Ashland
Subsidiary) any legal or equitable right, remedy or claim under this
Agreement.
11. Changes in Capital Structure. If, prior to the Closing
Date:
(i) Ashland Coal shall effect a stock split, subdivision or
consolidation of shares or a recapitalization or other capital
readjustment, the payment of a stock dividend, or other increase
or reduction of the number of shares of Class B Preferred Stock
of Ashland Coal, then the number of Shares then subject to the
Put Option and the Call Option hereunder shall be appropriately
adjusted.
(ii) There shall occur a merger of one or more corporations
into Ashland Coal, or a share exchange with, or a consolidation
of, Ashland Coal and one or more corporations in which Ashland
Coal shall be the surviving corporation, Ashland shall, at no
additional cost, be entitled upon exercise of the Put Option or
the Call Option by the appropriate party to receive the Shares,
or if Saarberg shall have received any shares of stock, other
securities or other consideration for the Shares in
-16-
any such merger, share exchange or consolidation, such shares of
stock or other securities or consideration.
(iii) Ashland Coal is merged into, or conducts a share
exchange or is consolidated with, another corporation under
circumstances where Ashland Coal is not the surviving
corporation, or Ashland Coal sells or otherwise disposes of
substantially all its assets to another corporation, after the
effective date of such merger, share exchange, consolidation or
sale, as the case may be, Ashland shall be entitled, upon
exercise of the Put Option or the Call Option by the appropriate
party, to receive the shares of stock, other securities or other
consideration received by Saarberg in exchange for the Shares in
any such merger, share exchange, consolidation or sale.
12. Confidentiality. Unless otherwise agreed, Saarberg and
Ashland each shall keep this Agreement and its terms confidential and
neither party will make any announcement or disclosure with respect
thereto until after the Agreement has been approved by both Saarberg's
Supervisory Board and Ashland's Board of Directors; provided, that
Saarberg shall have the right to give notice to Carboex (including
delivery of a copy of this Agreement) immediately after the parties
hereto have signed this Agreement. Notwithstanding the foregoing, in
the event that Saarberg's or Ashland's legal counsel concludes, prior
to receipt of such approvals, that disclosure is required by law or by
the German Federal or Saarland state authorities, then Saarberg or
Ashland, as the case may be, may make such required disclosure, but
only after first advising the other party hereto of the proposed
timing and content of
-17-
such disclosure at least two business days prior to the date of such
proposed disclosure. The term "business day" shall mean any day that
is not a Saturday, Sunday or other day on which courts in the State of
Delaware are authorized or obligated to close.
13. Best Reasonable Efforts. Ashland will utilize its best
reasonable efforts to cause the satisfaction of conditions in Section
7, including making all filings required under the HSR Act. Saarberg
will utilize its best reasonable efforts to cause the satisfaction of
conditions in Section 6.
14. Securities Act Compliance. Ashland understands that the
Shares have not been registered under the Securities Act of 1933, as
amended (the 33 Act) or registered or qualified under the securities
laws of any state and agrees that it will not transfer the Shares
unless they are subsequently registered under the 33 Act and
registered or qualified under applicable state securities laws, or
unless an exemption is available which permits transfers without
registration or qualification.
15. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed as of the date first set forth above.
ASHLAND OIL, INC. SAARBERGWERKE AG
By: /s/ Thomas L. Feazell By: /s/ Hans-Reiner Biehl
------------------------------ ---------------------------
Thomas L. Feazell Hans-Reiner Biehl
Its: Senior Vice President, General Its: Chairman of the
Counsel and Secretary Board of Managing Directors
By: /s/ Michael G. Ziesler
----------------------------
MichaelG. Ziesler
Its: Member of the Board of
Managing Directors
-18-
EXHIBIT B
AMENDMENT TO RESTATED SHAREHOLDERS AGREEMENT
THIS AMENDMENT TO RESTATED SHAREHOLDERS AGREEMENT
(the "Amendment") dated this 6th day of August, 1993 by and among Ashland
Oil, Inc. ("Ashland"), a Kentucky corporation, Saarbergwerke AG
("Saarberg"), a company organized under the laws of the Federal Republic of
Germany, Carboex International, Ltd. ("Carboex"), a company organized under
the laws of the Bahamas and Ashland Coal, Inc. (the "Company"), a Delaware
corporation.
WITNESSETH:
WHEREAS, Ashland, Saarberg, Carboex and the Company entered into the
Restated Shareholders Agreement dated December 12, 1991 (the "Agreement");
and
WHEREAS, Ashland, Saarberg, Carboex and the Company desire to amend the
Agreement as provided herein;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Ashland, Saarberg, Carboex and
the Company hereby agree as follows:
(1) A NEW SECTION 1.22 IS HEREBY ADDED TO THE AGREEMENT TO READ
AS FOLLOWS:
1.22 "Qualifying Disposition" means a Disposition of Shares of common
stock of the Company made in accordance with paragraph B of Section 4.4
by a Shareholder: (i) in an underwritten public offering made pursuant
to a registration statement filed with the Securities Exchange
Commission; or (ii) in a sale under Rule 144 of the Securities Act of
1933, as amended on any national stock exchange on which the Shares of
the Company are listed to any buyer except a buyer with whom the
sale has been previously arranged and who, together with any affiliated
Person, will hold more than five hundred thousand (500,000) Common
Shares of the Company after the Disposition; or (iii) to any Person who,
together with any affiliated Person, will hold five hundred thousand
(500,000) Common Shares of the Company or less after the Disposition.
For purposes of this Section 1.22, a Person shall be deemed affiliated
with another Person if such Person, directly or indirectly, controls, is
controlled by or is under common control with the other Person (where
"control" means the beneficial ownership, directly or through others, of
more than 50% of the voting shares or equivalent interest or ownership
interest).
(2) SECTION 4.2 OF THE AGREEMENT IS HEREBY AMENDED TO READ AS FOLLOWS:
4.2 Restrictions in General. No Shareholder shall make or permit a
Disposition of any Shares except in compliance with the terms of this
Article 4. No Shareholder shall pledge or otherwise encumber, or create
a security interest in, any Shares owned by such Shareholder or permit
to exist any lien, encumbrance or security interest in any such Shares
except that the foregoing restrictions shall not apply to pledges,
encumbrances, liens or security interests that collectively affect not
more than five hundred thousand (500,000) Common Shares owned by such
Shareholder that are made to any one Person (including affiliates of
such Person as defined in Section 1.22 above). No Shareholder shall
have the right to make or permit a Disposition other than (i) a
-2-
Disposition to an Affiliate pursuant to Section 4.3 hereof, (ii) a sale
to a person other than an Affiliate pursuant to paragraph A of Section
4.4 hereof in consideration of a purchase price payable solely in cash
(in a currency which can be freely bought and sold), or (iii) a
Qualifying Disposition. In the case of any Disposition of Shares,
except a Qualifying Disposition, the person acquiring such Shares shall
(unless the Remaining Shareholder shall otherwise agree in writing) by
acceptance of the certificates evidencing the Disposition Shares,
become bound by the terms and conditions of this Agreement, as though
an original party hereto, and shall, nevertheless, as a condition
precedent to such Disposition, join in this Agreement by an instrument
in writing reasonably satisfactory to the Remaining Shareholder.
(3) SECTION 4.4 OF THE AGREEMENT IS HEREBY AMENDED TO READ AS FOLLOWS:
4.4 Disposition to Non-Affiliate.
A. This paragraph A shall govern any Disposition of Shares (as such
term is defined in the Agreement) by any Shareholder to a person other
than an Affiliate of such Shareholder except a Qualifying Disposition.
1. In case any Shareholder shall receive a bona fide offer (meeting
the requirements of Section 4.2 hereof) from a person other than an
Affiliate of such Shareholder (a "Third Party Offeror") to purchase
Shares owned by such Shareholder and shall in good faith intend to
accept such offer, such Shareholder shall transmit to the
-3-
Remaining Shareholder a notice of such offer (a "Disposition Notice"),
specifying in reasonable detail the identity of the Third Party Offeror
and the purchase price and other terms and conditions of such offer, and
transmitting a complete and correct copy of such offer. Upon delivery
of the Disposition Notice, each Remaining Shareholder shall have the
right and option, exercisable by written notice to the Disposing
Shareholder within 30 days after delivery of the Disposition Notice, to
purchase all, but not less than all, of its "Proportionate Percentage"
(meaning the percentage arrived at by dividing the number of Shares
owned by it by the number of Shares owned by all the Remaining
Shareholders) of the Disposition Shares at the purchase price and upon
the other terms and conditions specified in the Disposition Notice
except that, in the case of a Disposition of Shares of Common Stock of
the Company (which is not a Qualifying Disposition), the purchase price
per share shall be an amount equal to the closing price of the
Company's Common Shares on the New York Stock Exchange on the date the
Disposition Notice is given less a reasonable underwriter's fee or a
private placement discount which will be determined by taking the
arithmetical average of such fee or discount as quoted by two
underwriters or investment bankers, one selected by the Disposing
Shareholder and one selected by the Remaining Shareholder. The closing
of the purchase of the Disposition Shares by each Remaining
Shareholder shall take place at the principal office of the Company on
the dates specified by each Remaining Shareholder in the notice of
exercise, but not earlier than 60 days after the date of the
-4-
Disposition Notice. At the closing, the Disposing Shareholder shall
deliver to each Remaining Shareholder certificates for the Disposition
Shares to be purchased by it (duly endorsed for transfer to or
accompanied by appropriate stock powers to) each Remaining
Shareholder, accompanied by any requisite stock transfer tax stamps or
other evidence of payment of any applicable stock transfer taxes,
against payment by each Remaining Shareholder of the purchase price
therefor.
If one Remaining Shareholder does not elect to purchase its
Proportionate Percentage of the Disposition Shares the Disposing
Shareholder shall give notice of this fact to the Remaining Shareholder
who has elected to purchase its Proportionate Percentage of the
Disposition Shares and thereafter said Remaining Shareholder shall
have the option for 10 days to purchase the remainder of the Disposi-
tion Shares on the same terms and manner set forth hereinabove for its
option to purchase its Proportionate Percentage of the Disposition
Shares.
2. In case the Remaining Shareholder shall not exercise its option
pursuant to the foregoing subparagraph 1 of this paragraph A, the
Disposing Shareholder may (subject to Section 4.5 hereof) within 180
days after the date of the Disposition Notice, sell all, but not less
than all, of the Disposition Shares to the Third Party Offeror at a
purchase price and upon other terms and conditions no more favorable to
the Third Party Offeror than those specified in the Disposition Notice.
-5-
Promptly after such sale, the Disposing Shareholder shall give notice
thereof to the Remaining Shareholder, confirming the identity of the
Third Party Offeror and the purchase price and other terms and
conditions of the sale, accompanied by duly executed counterparts of the
instrument of joinder required by Section 4.2 hereof. Upon delivery of
such notice and instrument, the Disposing Shareholder shall be released
from all obligations hereunder with respect to the Disposition Shares.
B. A Shareholder may make a Qualifying Disposition subject to the
following conditions:
1. Prior to making the Qualifying Disposition, the Shareholder shall
give the Company and the Remaining Shareholder at least 20 days prior
written notice specifying if the Common Shares are to be sold
publicly, or, if a private sale is contemplated, specifying in
reasonable detail the identity of the recipient of such shares, the
number of such shares the recipient will receive in the Disposition
and the price per share or other consideration to be paid for each
share.
2. Subject to the next sentence, the Company may, by written notice
to the Shareholders, suspend the right of the Shareholders to make a
Qualifying Disposition for a period of 90 days if, at the time it
receives notice pursuant to subparagraph 1 of this paragraph B, the
Company determines, in its reasonable business judgment, that the
Qualifying Disposition would require the disclosure of material
information which the Company has a bona fide business purpose for
preserving as confidential or would interfere with any pending or
-6-
formally proposed securities offering involving the Company or any of
its subsidiaries and promptly provides the Shareholders with a notice
of suspension. The Company shall not be permitted to suspend more than
two Qualifying Dispositions in any twelve month consecutive period.
C. If at any time a Shareholder and its Affiliates no longer hold any
Shares, such Shareholder shall cease be a party to this Agreement.
(4) SECTION 4.5 OF THE AGREEMENT IS HEREBY AMENDED TO READ AS FOLLOWS:
4.5 Approval of Non-Affiliates. Notwithstanding any provision of
this Article 4 to the contrary, no Shareholder shall make a Disposition,
except a Disposition to an Affiliate or a Qualifying Disposition,
without the approval of the Remaining Shareholder, which approval
shall not be unreasonably withheld. Such approval shall be
conclusively deemed to have been granted if not expressly withheld by
written notice delivered to the Disposing Shareholder within 30 days
after delivery of the applicable Disposition Notice.
(5) SECTION 5.1 OF THE AGREEMENT IS HEREBY AMENDED TO READ AS FOLLOWS:
5.1 Stock Legend. The Company shall cause all certificates
representing Shares to be endorsed as follows:
"The shares evidenced by this Certificate are subject to the
restrictions and options stated in, and are transferrable only
upon compliance with, the provisions of that certain Restated
Shareholders Agreement Dated December 12,
-7-
1991, among Ashland Oil, Inc., Saarbergwerke AG, Carboex International
Ltd. and Ashland Coal, Inc., as amended, a copy of which is on file
in the office of the Secretary of the Company, and the provisions of
which Agreement are incorporated herein by reference. The holder of
this Certificate, by its acceptance hereof, agrees to be bound by all
the terms of said Agreement, unless this Certificate is received as
part of a Qualifying Disposition as defined in said Agreement. Except
as provided in said Agreement, the shares evidenced by this
Certificate may not be transferred, pledged or otherwise encumbered."
(6) SECTION 5.3 OF THE AGREEMENT IS HEREBY AMENDED TO READ AS FOLLOWS:
5.3 Transfer of Shares. The Company agrees that from and after the
Effective Date (a) it shall not transfer any Shares except in
compliance with the terms of this Agreement and (b) except upon the
written consent of the Remaining Shareholder provided pursuant to the
last sentence of Section 4.2 hereof, all certificates representing
Shares issued by the Company during the continuance of this Agreement,
except Common Shares issued in connection with a Qualifying
Disposition or Shares for which the Remaining Shareholder has released
the person acquiring such Shares from this Agreement as provided in
the last sentence of Section 4.2, shall be endorsed as stated in
Section 5.1 hereof.
-8-
(7) SECTION 7.2 OF THE AGREEMENT IS HEREBY AMENDED TO READ AS FOLLOWS:
[This Section intentionally left blank.]
(8) EXCEPT AS OTHERWISE AMENDED HEREIN, THE AGREEMENT SHALL REMAIN
UNCHANGED AND IN FULL FORCE AND EFFECT.
IN WITNESS WHEREOF, Ashland, Saarberg, Carboex and the Company have
hereunto caused this amendment to be executed by duly authorized
representatives as of the day and year first above written.
ASHLAND OIL, INC. CARBOEX INTERNATIONAL, LTD.
By: /s/ Paul Chellgren By:/s/ Gregorio Gonzalez-Irun Canchez
------------------------ ------------------------------------
SAARBERGWERKE AG ASHLAND COAL,
By: /s/ Michael G. Ziesler By: /s/ William C. Payne
/s/ Werner Externbrink -------------------------------------
-------------------------
-9-
RESTATED
SHAREHOLDERS AGREEMENT
AMONG
ASHLAND OIL, INC.,
SAARBERGWERKE AG,
CARBOEX INTERNATIONAL, LTD.
AND
ASHLAND COAL, INC.
DATED December 12, 1991
TABLE OF CONTENTS
Section Description Page
- --------- ------------------------------------ ----
DEFINITIONS 2
LEGAL STRUCTURE 5
CONDUCT OF BUSINESS OF THE COMPANY
3.1 Business of the Company ........... 5
3.2 Negation of other Restrictions
and Conditions ................. 6
3.3 Independent Organization .......... 6
3.4 Capitalization .................... 7
3.5 Services Provided by Ashland ...... 7
3.6 Coal Off-Take Agreement ........... 8
3.7 Technological Cooperation ......... 8
3.8 Geographic cooperation ............ 8
DISPOSITION OF COMPANY SHARES
4.1 Investment Representation ......... 11
4.2 Restrictions in General ........... 11
4.3 Disposition to Affiliate .......... 12
4.4 Disposition to Non-Affiliate ...... 13
4.5 Approval of Non-Affiliates ........ 15
OBLIGATIONS OF THE COMPANY
5.1 Stock Legend..................... 16
5.2 Company's Execution .................16
5.3 Transfer of Shares ................ 16
5.4 Inspection Right .................. 17
5.5 Actions of Subsidiaries ........... 17
DEFAULTS AND REMEDIES
6.1 Specific Enforcement .............. 17
6.2 Submission to Jurisdiction;
Service of Process ............. 18
Section Description Page
- --------- ------------------------------------ ----
MISCELLANEOUS
7.1 Term .............................. 19
7.2 Tradename and Trademarks .......... 19
7.3 Amendments; Waivers ............... 20
7.4 Successors and Assigns ............ 20
7.5 Notices ........................... 20
7.6 Computation of Time Periods ....... 22
7.7 Confidentiality ................... 22
7.8 Severability ...................... 23
7.9 Counterparts; Headings ............ 23
7.10 Governing Law ..................... 24
Appendix "A" Designation of Region I
RESTATED SHAREHOLDERS AGREEMENT, dated December 12, 1991, among
ASHLAND OIL, INC. ("Ashland"), a Kentucky corporation, SAARBERGWERKE AG
("SAARBERG"), a company organized under the laws of the Federal Republic of
Germany, CARBOEX INTERNATIONAL LTD. ("Carboex") a company organized under
the laws of the Bahamas, and ASHLAND COAL, INC. (the "Company"), a Delaware
corporation.
WITNESSETH:
WHEREAS, Ashland, Saarberg Coal International GmbH ("SCI") and the
Company entered into an agreement dated May 28, 1981, (the "Shareholders
Agreement") for the corporate governance of the Company; and,
WHEREAS, the Shareholders Agreement has been amended by that certain
First Shareholders Agreement Amendment dated February 27, 1982, among
Ashland, SCI, Sociedad Espanola de Carbon Exterior, S.A. ("SECE") and the
Company (the "First Amendment") and an amendment dated June 30, 1982, and
that certain Second Amendment to Shareholders Agreement dated August 18,
1988, both among Ashland, SCI, Carboex and the Company; and,
WHEREAS, by Assignment and Assumption Agreement made as of June 30,
1982, SECE assigned to Carboex all of its rights, duties and obligations
under certain agreements, including among them the First Amendment, and
Carboex assumed full performance of all of the terms and conditions of the
First Amendment; and,
WHEREAS, effective September 30, 1988, SCI was merged into Saarberg
with Saarberg being the surviving corporation; and,
WHEREAS, the parties desire to enter into this Restated Shareholders
Agreement for the purpose of restating the Shareholders Agreement, as so
amended, in its entirety to reflect such amendments and the merger of SCI
into Saarberg and not to otherwise change any of the substantive terms and
provisions thereof.
NOW, THEREFORE, the parties hereto agree as follows:
1. DEFINITIONS
For all purposes of this Agreement, the following terms shall have the
following meanings:
1.1 "Affiliate" means, with respect to any Shareholder, any other
Person, which, directly or indirectly, controls, is controlled by, or is
under common control with, such Shareholder; provided, however, that ATEC,
INC. (formerly U.S. Filter Corporation) shall not be deemed to be an
affiliate of Ashland. For purposes of this definition, "control" means the
beneficial ownership directly, or indirectly through one or more
Affiliates, of more than 50% of the voting shares or equivalent interests
or ownership interests in a Person.
1.2 "Associate" means, with respect to any Shareholder, any other
Person, more than 25% but not more than 50% of the voting shares or
equivalent interests or ownership interests
- 2 -
in which are beneficially owned directly, or indirectly through one or more
Subsidiaries or Associates, by such Shareholder; provided, however, that
ATEC, INC. shall be deemed to be an Associate of Ashland.
1.3 "Board" means the Board of Directors of the Company.
1.4 "By-Laws" means the Amended By-Laws of the Company.
1.5 "Certificate of Incorporation" means the Restated Certificate of
Incorporation of the Company, as amended by Certificates of Amendment of
September 30, 1987 and July 28, 1988.
1.6 "Coal-Off-Take Agreement" means the restated coal off-take
agreement of even date herewith between the Company, Saarberg and Carboex
relating to the right on the part of Saarberg and Carboex to purchase coal
from the Company.
1.7 "Director" means a member of the Board.
1.8 "Disposing Shareholder" means the Shareholder who makes a
Disposition to one or more of its Affiliates pursuant to Section 4.3 hereof
or the Shareholder who provides the Disposition Notice referred to in
Section 4.4 hereof.
1.9 "Disposition" means any sale, transfer, assignment or other
disposition, whether by operation of law or otherwise, by any Shareholder
of any Shares.
1.10 "Disposition Shares" means Shares which are the subject of a
proposed Disposition.
1.11 "Effective Date", for the purposes of this Agreement, means (a)
with respect to Saarberg, the date of the consummation of the Closing under
the Stock Subscription
-3-
Agreement, and (b) with respect to Carboex, the date of the consummation of
the Closing under the Stock Purchase Agreement.
1.12 "Person" means any corporation, partnership, joint venture,
association, trust or other business entity.
1.13 "Region I" means the geographic areas designated as Region I on
the map contained in Appendix "A" attached hereto and in the Supplement
thereto, as such areas may from time to time be modified pursuant to the
terms of the Supplement thereto.
1.14 "Region III" means Producing District 8, as currently
established by the United States Bureau of Mines, exclusively of Region I.
1.15 "Remaining Shareholder" means the Shareholder or Shareholders, as
the context may require, other than the Disposing Shareholder.
1.16 "Services and Employee Benefits Agreement" means the agreement
dated May 28, 1981 between Ashland and the Company relating to the
provision of certain administrative services to the Company by Ashland and
to the participation by certain Company employees in the employee benefit
plans of Ashland.
1.17 "Shareholder" means any of Ashland, Saarberg and Carboex and
"Shareholders" means all of Ashland, Saarberg and Carboex.
-4-
1.18 "Shares" means shares of any class of capital stock of the
Company owned by any Shareholder.
1.19 "Stock Purchase Agreement" means the agreement dated February 27,
1982 between Ashland and SECE relating to the purchase of certain Shares by
SECE from Ashland, which agreement was assigned to Carboex on June 30,
1982.
1.20 "Stock Subscription Agreement" means the agreement dated May 28,
1981, between SCI, Ashland and the Company relating to the subscription for
certain Shares made by SCI and Ashland.
1.21 "Subsidiary" means, with respect to any Person, any other Person,
more than 50% of the voting shares or equivalent interests or ownership
interests in which are beneficially owned directly, or indirectly through
one or more Subsidiaries, by such Person; provided, however, that ATEC,
INC. shall be deemed not to be a Subsidiary of Ashland.
2. LEGAL STRUCTURE
(INTENTIONALLY LEFT BLANK]
3. CONDUCT OF BUSINESS OF THE COMPANY
3.1 Business of the Company. The business of the Company and its
Subsidiaries shall be limited to (a) the acquisition, construction, and
operation of coal mines of every type and nature, (b) the exploration for,
acquisition of and exploitation of coal properties, (c) the
producing, preparation and related processing, loading, storing,
transporting and marketing of coal, (d) the activities
-5-
conducted by Commonwealth Equipment, Inc., when it was a Subsidiary of the
Company and the activities currently conducted by Tri-State Testing Co.,
Inc., a Subsidiary of the Company, (e) the exploitation of the limestone
properties currently controlled by the Company, (f) the subleasing of coal
properties to others, (g) the purchase and sale of coal produced by others,
(h) activities (other than hard-rock mining) incidental to the foregoing
activities or to the ownership of properties acquired in connection with
the foregoing activities, such as the sale, lease, development or
exploitation of timber rights, oil and gas rights and other mineral rights.
3.2 Negation of Other Restrictions and Conditions. Nothing in this
Agreement shall be deemed to prohibit or restrict any Shareholder or any of
its Affiliates or Associates from engaging in any activity or acquiring any
asset which is not expressly prohibited or restricted by this Agreement.
3.3 Independent Organization. The Shareholders agree that the Company
shall be operated by its own management and employees as an independent
legal and economic entity in accordance with the General Corporation Law of
Delaware, this Agreement, and the Certificate of Incorporation and By-Laws
of the Company.
-6-
3.4 Capitalization. (INTENTIONALLY LEFT BLANK]
3.5 Services Provided by Ashland. Ashland and the Company have entered
into the Services and Employee Benefits Agreement at the request of and
with the approval of SCI. Carboex has reviewed a copy of such Agreement and
has ratified, approved and accepted such Agreement. The Shareholders agree
that the relationship between Ashland and the Company regarding the
provision by Ashland of any particular service or benefit plan under the
Services and Employee Benefits Agreement shall be in accordance with, and
subject to, the terms of the Services and Employee Benefits Agreement. The
Shareholders further agree that at such time as such relationship is to be
terminated, whether at the election of the Company or as a result of the
occurrence of an event requiring termination under the Services and
Employee Benefits Agreement, representatives of Ashland and the Company
shall work together to devise and implement a gradual phase-out of such
relationship in a manner designed (a) to minimize any adverse
administrative impact on the Company, and (b) with respect to employee
benefit plans, to minimize future funding and administrative costs for the
Company in providing such benefits.
-7-
3.6 Coal Off-Take Agreement. The Company has entered into the Coal
Off-Take Agreement granting Saarberg and Carboex certain rights to purchase
coal.
3.7 Technological Cooperation. Each of the Shareholders shall make
available (to the extent not in violation of contractual prohibitions,
secrecy agreements, or rights of third parties and to the extent otherwise
feasible) to the Company on customary terms, such current and future
technological know-how relating to the mining and preparation and related
processing of coal for sale as coal which such Shareholder possesses or
controls if such know-how can reasonably be expected to contribute to the
success of the business or operation of the Company.
3.8 Geographic Cooperation.
A. In case any Shareholder or Subsidiary shall acquire or propose to
acquire directly, or indirectly through any Subsidiary, any interest in any
coal property (fee or leasehold) or in any facility for the mining,
preparation and related processing, loading, storing or transporting of
coal located in Region I (such interest being called a "Region I
Opportunity"), such shareholder shall, prior to or promptly after the
acquisition of such Region I opportunity, give notice to the Company
describing such Region I Opportunity in reasonable detail and specifying
the price and terms and conditions upon which such Region I opportunity has
been or is proposed to be acquired by such Shareholder or Subsidiary. The
Company shall have the right, exercisable within 30 days
-8-
after receipt of such notice, to purchase such Region I opportunity at the
price and upon the other terms and conditions specified in such notice.
B. In case any Shareholder or Subsidiary shall acquire or propose to
acquire directly or indirectly through any Subsidiary, any interest of more
than 50% in any coal property (fee or leasehold) or in any facility for the
mining, preparation and related processing, loading, storing or
transporting of coal located in Region II (such interest being called a
"Region II Opportunity"), such Shareholder shall, prior to or promptly
after the acquisition of such Region II Opportunity, give notice to the
Company describing such Region II Opportunity in reasonable detail. If
within 30 days after delivery of such notice, the Company shall advise such
Shareholder or Subsidiary that the Company is interested in participating
in the ownership, use or operation of such Region II Opportunity and shall
indicate the general nature and the basic terms and conditions for such
participation, such Shareholder or Subsidiary will discuss the proposed
participation with the Company in good faith to determine whether the
parties would have a mutual economic interest in such participation (it
being understood that such Shareholder or Subsidiary shall be under no
obligation to negotiate or to grant any participation if it determines, in
its sole discretion, that there is no such mutual economic interest).
-9-
C. In case the transfer of a Region I Opportunity pursuant to
paragraph A of this Section 3.8 or the granting of a participation in a
Region II Opportunity pursuant to paragraph B of this Section 3.8 would
require the consent of a third party, the Shareholder or Subsidiary
acquiring such opportunity shall use reasonable efforts to obtain such
consent, and the obligation to give the notice required by paragraph A or B
of this Section 3.8 or to transfer such Region I opportunity or to grant
such participation in such Region II Opportunity shall be subject to the
receipt of such consent. In case any Shareholder or Subsidiary shall not
obtain any such consent, such Shareholder shall notify the Company, and the
other Shareholders shall have the right, by notice to the Company and the
other Shareholders, (a) to terminate the provisions of this Section 3.8, in
the case of a Region I Opportunity, or (b) to terminate the provisions of
paragraphs B and E of this Section 3.8, in the case of a Region II
Opportunity.
D. In case any Associate of any Shareholder shall acquire or propose
to acquire directly, or indirectly through any Associate, any Region I
Opportunity, such Associate may offer such Opportunity to the Company in
the manner and upon the terms provided in paragraph A of this section 3.8.
In case such Associate shall not make such offer to the Company, such
Shareholder shall notify the Company of such acquisition, and the other
Shareholders shall have the right, by notice to the Company and the other
Shareholders, to
-10-
terminate the provisions of this Section 3.8.
E. In case any Associate or any Shareholder shall acquire or propose
to acquire directly, or indirectly through any Associate, any Region II
Opportunity, such Associate may give notice to the Company and, if
requested by the Company, discuss the possibility of participation with the
Company in the manner provided in paragraph B of this Section 3.8. In case
such Associate shall not give notice to the Company, or, if requested,
shall fail to discuss participation as provided in paragraph B of this
Section 3.8, such Shareholder shall notify the Company of such acquisition
and the other Shareholders shall have the right, by notice to the Company
and the other Shareholders, to terminate the provisions of paragraphs B and
E of this Section 3.8.
4. DISPOSITION OF COMPANY SHARES
4.1 Investment Representation. The Shareholders represent to each
other Shareholder that they intend to hold their Shares as a long-term
investment for the indefinite future and have no current intention of
making a Disposition thereof except for the possible transfer pursuant to
Section 4.3 hereof to an Affiliate having a similar intention.
4.2 Restrictions in General. No Shareholder shall make or permit a
Disposition of any Shares except in compliance with the terms of this
Article 4. No Shareholder shall pledge or otherwise encumber, or create a
security interest in, any Shares owned by such Shareholder or permit to
exist any lien, encumbrance or security interest in any such
-11-
Shares. No Shareholder shall have the right to make or permit a
Disposition other than (i) a Disposition to an Affiliate pursuant to
Section 4.3 hereof, or (ii) a sale to a person other than an Affiliate
pursuant to Section 4.4 hereof in consideration of a purchase price payable
solely in cash (in a currency which can be freely bought and sold). In the
case of any Disposition of Shares, the person acquiring such Shares shall
(unless the Remaining Shareholder shall otherwise agree in writing) by
acceptance of the certificates evidencing the Disposition Shares, become
bound by the terms and conditions of this Agreement as though an original
party hereto, and shall, nevertheless, as a condition precedent to such
Disposition, join in this Agreement by an instrument in writing reasonably
satisfactory to the Remaining Shareholder.
4.3 Disposition to Affiliate. Each Shareholder may make a Disposition
of all or part of its Shares to an Affiliate of such Shareholder, which in
turn may make a Disposition of all or part of such Shares to such
Shareholder or to another Affiliate of such Shareholder; provided that (a)
unless the Remaining Shareholder, at the request of the Disposing
Shareholder but in the sole discretion of the Remaining Shareholder,
releases the Disposing Shareholder in writing, the Disposing Shareholder
shall remain liable for the performance by such Affiliate of all
obligations of the Disposing Shareholder hereunder with respect to
the Disposition Shares acquired by such Affiliate, and (b) as a condition
precedent to such Disposition, the Disposing
-12-
Shareholder, such Affiliate and the Remaining Shareholder shall enter into
an agreement, reasonably satisfactory in form and substance to the
Remaining Shareholder, providing that the Disposing Shareholder shall have
an unqualified right and obligation to reacquire the Disposition Shares
from such Affiliate upon such Affiliate's ceasing to be an Affiliate of the
Disposing Shareholder (upon which reacquisition such Disposing Shareholder
shall, if previously released by the Remaining Shareholder, again become a
party to this Agreement).
4.4 Disposition to Non-Affiliate.
A. In case any Shareholder shall receive a bona fide offer (meeting
the requirements of Section 4.2 hereof) from a person other than an
Affiliate of such Shareholder (a "Third Party Offeror") to purchase Shares
owned by such Shareholder and shall in good faith intend to accept such
offer, such Shareholder shall transmit to the Remaining Shareholder a
notice of such offer (a "Disposition Notice"), specifying in reasonable
detail the identity of the Third Party Offeror and the purchase price and
other terms and conditions of such offer, and transmitting a complete and
correct copy of such offer. Upon delivery of the Disposition Notice, each
Remaining Shareholder shall have the right and option, exercisable by
written notice to the Disposing Shareholder within 30 days after delivery
of the Disposition Notice, to purchase all, but not less than all, of its
"Proportionate Percentage" (meaning the percentage arrived at by dividing
-13-
the number of Shares owned by it by the number of Shares owned by all the
Remaining Shareholders) of the Disposition Shares at the purchase price and
upon the other terms and conditions specified in the Disposition Notice.
The closing of the purchase of the Disposition Shares by each Remaining
Shareholder shall take place at the principal office of the Company on the
dates specified by each Remaining Shareholder in the notice of exercise,
but not earlier than 60 days after the date of the Disposition Notice. At
the closing, the Disposing Shareholder shall deliver to each Remaining
Shareholder certificates for the Disposition Shares to be purchased by it
(duly endorsed for transfer to or accompanied by appropriate stock powers
to) each Remaining Shareholder, accompanied by any requisite stock transfer
tax stamps or other evidence of payment of any applicable stock transfer
taxes, against payment by each Remaining Shareholder of the purchase price
therefor.
If one Remaining Shareholder does not elect to purchase its
Proportionate Percentage of the Disposition Shares the Disposing
Shareholder shall give notice of this fact to the Remaining Shareholder who
has elected to purchase its Proportionate Percentage of the Disposition
Shares and thereafter said Remaining Shareholder shall have the option for
10 days to purchase the remainder of the Disposition Shares on the same
terms and manner set forth hereinabove for its option to purchase its
Proportionate Percentage of the Disposition Shares.
-14-
B. In case the Remaining Shareholder shall not exercise its option
pursuant to the foregoing paragraph A, the Disposing Shareholder may
(subject to Section 4.5 hereof) within 180 days after the date of the
Disposition Notice, sell all, but not less than all, of the Disposition
Shares to the Third Party Offeror at a purchase price and upon other terms
and conditions no more favorable to the Third Party Offeror than those
specified in the Disposition Notice. Promptly after such sale, the
Disposing Shareholder shall give notice thereof to the Remaining
Shareholder, confirming the identity of the Third Party Offeror and the
purchase price and other terms and conditions of the sale, accompanied by
duly executed counterparts of the instrument of joinder required by Section
4.2 hereof. Upon delivery of such notice and instrument, the Disposing
Shareholder shall be released from all obligations hereunder with respect
to the Disposition Shares, and provided that if neither the Disposing
Shareholder nor any of its Affiliates then hold any Shares, such Disposing
Shareholder shall cease to be a party to this Agreement.
4.5 Approval of Non-Affiliates. Notwithstanding any provision of this
Article 4 to the contrary, no Shareholder shall make a Disposition to a
person other than an Affiliate except upon the approval of the Remaining
Shareholder, which approval shall not be unreasonably withheld. Such
approval shall be conclusively deemed to have been granted if not expressly
withheld by written notice delivered to the
-15-
Disposing Shareholder within 30 days after delivery of the applicable
Disposition Notice.
5. OBLIGATIONS OF THE COMPANY
5.1 Stock Legend. The Company shall cause all certificates
representing Shares to be endorsed as follows:
"The shares evidenced by this Certificate are subject to the
restrictions and options stated in, and are transferrable only upon
compliance with, the provisions of that certain Restated Share-
holders Agreement Dated December 12, 1991, among Ashland Oil, Inc.,
Saarbergwerke AG, Carboex International Ltd. and Ashland Coal, Inc.,
a copy of which is on file in the office of the Secretary of the
Company, and the provisions of which Agreement are incorporated
herein by reference. The holder of this Certificate, by its
acceptance hereof, agrees to be bound by all the terms of said
Agreement. The shares evidenced by this Certificate may not be
pledged or otherwise encumbered and may not be transferred except as
provided in said Agreement."
5.2 Company's Execution. The Company shall execute and deliver to
the Shareholders, and shall become a party to, this Agreement, and the
Shareholders hereby consent to such execution and delivery.
5.3 Transfer of Shares. The Company agrees that from and after the
Effective Date (a) it shall not transfer any Shares except in compliance
with the terms of this Agreement and (b) except upon the written consent
of the Remaining Shareholder provided pursuant to the last sentence of
Section 4.2 hereof, all certificates representing Shares issued by the
Company during the continuance of this Agreement shall be endorsed as
stated in Section 5.1 hereof.
-16-
5.4 Inspection Right. The Company agrees, and the Shareholders
agree that they shall cause the Company, to provide each of the
Shareholders and their respective authorized representatives full and free
access to all books and records of the Company and any and all reports,
budgets or proposals prepared by or on behalf of the Company and to provide
each Shareholder a monthly statement of income and monthly reports on
production, sales and such other information as any Shareholder may
reasonably request. The Company agrees that on reasonable notice and during
standard business hours it will make any and all officers and employees of
the Company available to each Shareholder and its authorized
representatives for interviews.
5.5 Actions of Subsidiaries. The Company covenants and agrees that it
will cause each Subsidiary of the Company to comply with and carry out
decisions of the Board taken in accordance with the By-Laws, and it will
not permit any Subsidiary to take (or omit to take) any action which, if
taken (or omitted) by the Company, would require approval of the Board
pursuant to Article II, Section 10.B of the By- Laws, unless the taking (or
omission) of such action by such Subsidiary has been duly approved by the
Board.
6. DEFAULTS AND REMEDIES
6.1 Specific Enforcement. In the event of any breach or threatened
breach by any party to this Agreement of any of the covenants, agreements,
terms, conditions or limitations contained in this Agreement, any other
party to this
-17-
Agreement shall be entitled to enjoin such breach or threatened breach and
shall have the right to invoke any right or remedy allowed at law or in
equity or by statute or otherwise, it being understood, agreed and
acknowledged that monetary damages may not be sufficient to compensate an
aggrieved party.
6.2 Submission to Jurisdiction; Service of Process. The Shareholders
hereby irrevocably submit to the jurisdiction of the Federal court sitting
in the Southern District of New York over any action or other proceeding
brought by any of the parties hereto or by any of their successors or
assigns arising out of or relating to this Agreement. The Shareholders and
the Company hereby irrevocably agree that all claims with respect to such
suit, action or other proceeding may be heard and determined in such courts
to the exclusion of any other forum in the United States.
Saarberg hereby irrevocably appoints Messrs. Shearman & Sterling,
Attention: Edward L. Turner III, Esq., whose office is located at 599
Lexington Ave., New York, NY 10022, United States, as its agent to receive
on behalf of Saarberg service of copies of any summons and complaint and
any other process which may be served in any such action or proceeding.
Carboex hereby irrevocably appoints C T Corporation System, whose
office is located at 1633 Broadway, New York, New York 10019, United
States, as its agent to receive on behalf of Carboex service of copies of
any summons and complaint and any other process which may be served in any
-18-
such action or proceeding.
7. MISCELLANEOUS
7.1 Term. This agreement shall become effective on the Effective Date
and shall remain in full force and effect thereafter until terminated by an
instrument in writing by all parties hereto. In the event that the
Effective Date does not occur (a) with respect to Saarberg, on or before
June 9, 1981 or such later date to which the parties to the Stock
Subscription Agreement consent to extend the closing thereunder, or (b)
with respect to Carboex, on or before September 30, 1982, or such later
date to which the parties to the Stock Purchase Agreement consent to extend
the closings thereunder, this Agreement shall terminate and become null and
void.
7.2 Tradename and Trademarks. Ashland agrees to permit the Company to
use the name "Ashland" and all trademarks and tradenames of the Company
associated therewith for a period of five years from and after August 18,
1988; provided, however, if at any time after two years from and after
August 18, 1988, Ashland shall own less than 40% of the outstanding Shares,
the Company agrees that within 30 days of Ashland's request the Company
shall change its corporate name so as to eliminate therefrom the word
"Ashland" and any simulation or variation thereof and that it shall
thereafter forever discontinue the use of its current trademark, the use of
its current tradename, the use of the word "Ashland" in its corporate
title, its tradename or otherwise, and the use of
-19-
any simulation or variation of such trademark, tradename or word. The
Shareholders agree to vote their Shares in favor of any corporate action
necessary to accomplish the foregoing.
7.3 Amendments; Waivers. This Agreement may not be amended or modified
in any manner, and no provision hereof may be waived or discharged except
by an instrument in writing signed by an authorized officer of each of the
parties hereto. The failure of any party hereto to enforce at any time
any of the provisions of this Agreement shall in no way be construed to be
a waiver of any such provision, or the right of any party thereafter to
enforce each and every such provision. No waiver of any breach of this
Agreement shall be held to be a waiver of any other or subsequent breach.
7.4 Successors and Assigns. Unless otherwise herein provided, this
Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective permitted successors and permitted assigns.
7.5 Notices. All notices, requests, demands and other communications
hereunder shall be in writing and delivered personally or sent by first
class airmail, telex or telecopy as follows:
To Ashland:
Ashland Oil, Inc.
P. 0. Box 391
Ashland, Kentucky 41114, USA
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Telex No. 218476
Answer Back: AOINC
Attention: General Counsel
To Saarberg:
Saarbergwerke AG
Trierer Strasse 1
P. 0. Box 1030
D-6600 Saarbruecken, Federal
Republic of Germany
Telex No. 4421240
Answer Back: SBWD
Attention: Vorstand
To Carboex:
Sociedad Espanola de Carbon Exterior, S.A.
Calle Manuel Cortina
No. 2
Madrid 10
Spain
Telex No. 46342
Answer Back: CRBX-E
To the Company:
Ashland Coal, Inc.
P. 0. Box 6300
Huntington, West Virginia 25771, USA
Telex No. 7109311907
Answer Back: ASH COAL
Attention: President
or such other address as may be designated in writing by any party to the
other parties hereto. Any notice or other communication so transmitted
shall be deemed to have been given at the time of delivery, in the case
of a communication delivered personally, on the business day following
receipt of answerback or telecopy confirmation, in the case of a
communication sent by telex or telecopy, respectively, or ten
-21-
days after mailing in the case of a communication sent by mail.
7.6 Computation of Time Periods. The words "day" or "days" as used in
this Agreement with respect to the computation of periods of time shall
mean calendar days and the words "business day" or "business days" as used
in this Agreement with respect to the computation of periods of time shall
mean any day that is not a Saturday, Sunday, or other holiday in West
Virginia or Saarbruecken, Federal Republic of Germany or Madrid, Spain;
provided, however, that if the last day of any period of time shall fall on
a day other than a business day, such period shall be extended to include
the next succeeding business day in each such location. All computations of
time shall be based on New York City time.
7.7 Confidentiality. Except as required by law, by the German Federal
or Saarland state authorities or Spanish state authorities, the
Shareholders agree that they shall each keep confidential all non-public
information received by them from the Company regarding its affairs,
business, prospects and properties and will not disclose such information
to any party other than to another Shareholder, any Affiliate of a
Shareholder, any prospective purchasers of Shares, or any employee or
agent of such Shareholder, Affiliate or prospective purchaser; provided,
however,that the recipient of such information is subject to
confidentiality agreements equivalent hereto, unless such information was
in the possession of such party prior to its receipt from the
-22-
Company, was in the public domain or was received from a third party who
did not receive it from the Company.
7.8 Severability. If any provision of this Agreement should be or
become fully or partly invalid or unenforceable for any reason whatsoever
or should violate any applicable law, this Agreement is to be considered
devisible as to such provision and such provision is to be deemed deleted
from this Agreement, and the remainder of this Agreement shall be valid and
binding as if such provision were not included therein. There shall be
substituted for any such provision deemed to be deleted a suitable
provision, which as far as is legally possible, comes nearest to what the
parties desired or would have desired according to the sense and purpose of
this Agreement, had they considered the point when concluding this
Agreement.
7.9 Counterparts; Headings. This Agreement may be executed in
several counterparts, each of which shall be deemed to be an original, but
all such counterparts together shall constitute but one and the same
instrument. The Article and Section headings in this Agreement are for
the convenience of reference only and shall not affect the construction
hereof.
-23-
7.10 Governing Law. This Agreement shall be governed by, enforceable
under and construed in accordance with the law of the State of New York.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
ASHLAND OIL, INC. CARBOEX INTERNATIONAL, LTD.
By: /s/ Paul Chellgren By: /s/ Juan Antonio Ferrando
------------------------- -------------------------------
SAARBERGWERKE AG ASHLAND COAL, INC.
By: /s/ Hans Freymann By: /s/ William C. Payne
/s/ Deitrich Reinhardt --------------------------------
--------------------------
-24-
DESIGNATION OF REGION I
The Property Map for Ashland Coal, Inc. dated January 21, 1981, bearing a
notation referring to this Agreement and initialled by the parties hereto,
is incorporated herein by reference. A reduced reproduction of said
Property Map is attached hereto for purposes of convenience only.
APPENDIX "A"
SUPPLEMENT TO APPENDIX "A"
The map contained in Appendix "A" is hereby supplemented as follows:
AREA A - western boundary is western limit of Appalachian
coal field.
AREA B - includes all reserves committed to the Monterey
Coal Company Mine by the joint venture of Exxon
Coal and Columbia Gas as established by that
certain joint venture agreement between Exxon Coal
and Columbia Gas.
AREA E - includes all river loading facilities on the Ohio
between Point Pleasant and the confluence of the
Ohio and Mississippi Rivers, Big Sandy and Kanawha
Rivers except such facilities as required by any
Shareholder or any Subsidiary or Associate of any
Shareholder for preparation and related processing
of coal provided from mines in Producing District
8 in which they have an equity interest or for
preparation and related processing of coal
provided from other Districts.
If the Company acquires any coal property constituting a major mine unit
which is located in Region II, the Shareholders will discuss the
possibility of revising the definition of Region I to accommodate such
acquisition.
[MAP APPEARS HERE]
-25-
Graphic Material Cross-Reference Page
A map which shows in extensive detail various boundaries of
Appalachian coal fields and all river coal loading facilities on the Ohio
River between Point Pleasant, West Virginia, and the confluence of the Ohio
and Mississippi Rivers, Big Sandy and Kanawha Rivers appears on page 25.