PURCHASE AGREEMENT

Exhibit 10.49

Execution Version

PURCHASE AGREEMENT

dated as of August 3, 2008

by and among

KOPPERS INC.,

CARBON INVESTMENTS, INC.,

and

ARCELORMITTAL S.A.

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PURCHASE AGREEMENT

THIS PURCHASE AGREEMENT, dated as of August 3, 2008 (this “ Agreement ”), by and among Koppers Inc., a Pennsylvania corporation (“ Koppers ”), Carbon Investments, Inc., a Delaware corporation (“ CI ” and, together with Koppers, “ Sellers ”), which is a party to this Agreement solely for the purpose of being bound by Article II and Sections 3.3, 6.6, 12.2, 13.1 and 15.2 of this Agreement and making the representations and warranties in Sections 4.2(b), 4.4(b), 4.4(d) and 4.7(b) of this Agreement, and ArcelorMittal S.A., a société anonyme organized under the laws of Luxembourg, acting directly or through its designee (“ Buyer ”).

RECITALS

WHEREAS, Koppers Monessen Partners LP, a Delaware limited partnership (the “ Partnership ”), is engaged in the business of producing coke and various by-products of the coke production process (the “ Business ”) at its Monessen, Pennsylvania facility (the “ Facility ”);

WHEREAS, Koppers owns a 95% interest in the Partnership and CI owns a 5% interest in the Partnership, each of which shall be converted at Closing (the “ Conversion ”), pro rata , into the sole membership interests (such converted interests, respectively, the “Koppers Interests” and the “CI Interests,” and together, the “ Interests ”) of a newly formed Delaware Limited Liability Company (the “ Limited Liability Company ”); and;

WHEREAS, Buyer desires to purchase from each of Koppers and CI, and each of Koppers and CI desires to sell to Buyer, upon the terms and subject to the conditions hereinafter set forth, the Koppers Interests and the CI Interests, respectively.

NOW THEREFORE, in consideration of the mutual promises and covenants contained herein and intending to be legally bound, each of the parties hereto hereby agrees as follows:

ARTICLE I

DEFINITIONS

1.1 General Provisions . For all purposes of this Agreement, except as otherwise expressly provided:

(a) the terms defined in this Article I have the meanings assigned to them in this Article I and include the plural as well as the singular;

(b) all references herein to designated “Articles,” “Sections” and other subdivisions and to “Exhibits” and “Schedules” are to the designated Articles, Sections and other subdivisions of the body of this Agreement and to the exhibits and schedules to this Agreement;

(c) pronouns of either gender or neuter shall include, as appropriate, the other pronoun forms;

 

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(d) when any representation, warranty, covenant or agreement contained in this Agreement is expressly qualified by reference to “ Koppers’ knowledge ” or words of similar import, it shall mean the current, actual knowledge of the individuals set forth in Part I of Schedule 1.1(d) , following reasonable inquiry.

(e) where any representation, warranty or other provision in this Agreement refers to notice or written notice having been delivered or received by the Partnership or any of its Affiliates, such representation, warranty or other provision shall be interpreted to include only any notice to the individuals set forth in Part I of Schedule 1.1(d) or any notice of which one of such individuals has actual knowledge, following reasonable inquiry as to the sending or receipt of such notice.

(f) when any representation, warranty, covenant or agreement contained in this Agreement is expressly qualified by reference to “ Buyer’s knowledge ” or words of similar import, it shall mean the current, actual knowledge of the individuals set forth in Part II of Schedule 1.1(d) , following reasonable inquiry.

(g) the Parties anticipate that, immediately prior to Closing, the Partnership will be converted into a Delaware Limited Liability Company as provided for in Section 9.1(e) hereof. All references in this Agreement to the “Partnership,” including, without limitation, with respect to the representations and warranties and covenants of Koppers and/or CI concerning the Partnership, the Partnership Agreement and the Interests of the Partnership, shall be deemed, upon conversion, to apply to the Limited Liability Company (notwithstanding any specific references elsewhere in this agreement to the Limited Liability Company).

(h) all references herein to “books and records” shall include, without limitation, computer records and files; and

(i) all references to Sellers, Buyer or the Partnership shall include any successor or assign of such Person.

1.2 Specific Provisions . As used herein the following definitions shall apply:

“ 30-Day Period ” is defined in Section 2.3(c).

“ Accountants’ Determination ” is defined in Section 2.3(c).

“ Action ” means any action, complaint, investigation, petition, suit, arbitration or other proceeding, whether civil or criminal, in law or in equity, or before any arbitrator or Governmental Entity.

“ Adjusted Purchase Price ” shall mean an amount equal to the Initial Purchase Price, plus (y) the dollar amount of Net Working Capital (as finally determined in accordance with Section 2.3 below).

 

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“ Affiliate ” means a Person that directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with, a specified Person.

“ Agreed Rate ” means, as of the date of any payment of interest to be made by reference thereto, the interest rate from time to time announced by PNC Bank as its prime rate calculated on the basis of a 365-day year and charged for the actual number of days elapsed.

“ Agreement ” is defined in the caption to this Agreement.

“ Amount Transferred ” is defined in Section 14.5(c).

“ Approval ” means with respect to a given Person any approval, authorization, consent, qualification or registration, or any waiver of any of the foregoing, required to be obtained by such Person from, or any notice, statement or other communication required to be filed by such Person with or delivered by such Person to, any Governmental Entity or any other Person.

“ Approval Contract ” is defined in Section 6.9(b).

“ Arbitrating Accountants ” is defined in Section 2.3(c).

“ Assignment ” is defined in Section 3.2(a).

“ Assignable Contract ” is defined in Section 6.9(a).

“ Assumed Koppers Liabilities ” is defined in Section 2.3(d).

“ Assumed Retirement Liabilities ” is defined in Section 14.5

“ Business ” is defined in the Recitals to this Agreement.

“ Buyer ” is defined in the caption to this Agreement.

“ Buyer Actuary ” is defined in Section 14.5(b).

“ CI ” is defined in the Recitals to this Agreement.

“ CI Interests ” is defined in the Recitals to this Agreement.

“ Closing ” means the consummation of the purchase and sale of the Interests pursuant to this Agreement.

“ Closing Date ” means the date of the Closing.

“ Closing Financial Schedule ” is defined in Section 2.3(a).

“ Code ” means the Internal Revenue Code of 1986, as amended.

 

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“ Commercially Reasonable Efforts ” means as to a party, an undertaking by such party to perform or satisfy an obligation or duty or otherwise act in a manner reasonably calculated to obtain the intended result, provided that such party shall not be required to take actions, other than in the ordinary course of business, which would cause it to (i) expend funds other than for payment of the reasonable and customary costs and expenses of employees, counsel, consultants, representatives or agents of such party in connection with the performance or satisfaction of such obligation or duty or other action, (ii) institute litigation or arbitration as a part of its Commercially Reasonable Efforts or (iii) amend, waive or modify a term or condition of, or grant any concessions under or with respect to, any contract or relationship with respect to which an approval is sought or any other agreement or relationship with such Person.

“ Competing Transaction ” is defined in Section 6.6.

“ Contract ” means any binding agreement, contract, guarantee, license, lease, promise, understanding or arrangement (written or unwritten), bond, note, commitment, franchise, indemnity, indenture, instrument, lease or license, together with any schedules or documents executed or delivered in connection therewith and any modifications, amendments or supplements thereto.

“ Conversion ” is defined in the Recitals to this Agreement.

“ Current Financial Schedule ” is defined in Section 4.8(a).

“ Dell Leased Equipment ” means the computer equipment leased from Dell Financial Services L.P. pursuant to lease schedules number 053, 054, 082, 083, 085 and 097 executed under that certain Master Lease Agreement No. 6059888 dated as of October 12, 1998 and used by the Partnership, to the extent such schedules relate to the equipment described in Section 4.11(a) of the Disclosure Schedule .

“ Draft Purchase Price Allocation ” is defined in Section 13.2.

“ Employee Benefit Plans ” means all Employee Pension Benefit Plans (as defined in Section 3(2) of ERISA, whether or not subject to ERISA), all Employee Welfare Benefit Plans (as defined in Section 3(1) of ERISA, whether or not subject to ERISA) and each other employee benefit program, policy, agreement, arrangement or payroll practice, whether or not subject to ERISA or the Code, which provides any bonus, commission, profit-sharing, incentive, change in control, equity or equity-based severance or termination benefit, or that is a payroll policy, vacation, fringe benefit, deferred compensation, retirement benefits, employment agreement or similar program, policy, agreement or arrangement.

“ Employees ” means those personnel employed by Koppers in connection with the operation of the Business as of July 24, 2008, each of whom is listed in Section 4.13(a) of the Disclosure Schedule (including those employees currently on inactive status), and non-executive new hires who are hired in, and have terms and conditions of employment consistent with, the ordinary course of business. For the avoidance of doubt, Employees does not include personnel employed by Koppers 50% or more of whose time spent providing services that extend beyond the operation of the Business.

 

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“ Encumbrance ” means any claim, charge, easement, lien, lease, covenant, security interest, encumbrance, option, pledge, rights of others or other restriction.

“ Environmental Laws ” means all applicable laws, statutes, judicial decisions, regulations, ordinances and other requirements of Governmental Entities or duties under common law relating to the protection of health, safety, the environment or natural resources.

“ Environmental Permits ” means all licenses, permits and other authorizations or registrations required under any Environmental Laws, including those arising from any construction or modification of any emission sources.

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended, and the related regulations and published interpretations.

“ Estimated Amount ” is defined in Section 14.5(c).

“ Excluded Intangible Property ” the names “Koppers” and any names derived therefrom and any rights (ownership, licensed or otherwise) of the Partnership to use the mark “Koppers,” and the color associated therewith, and any other trademarks, service marks, brand names, Internet domain names, logos, trade dress, trade names, corporate names and other indicia of origin, and any derivatives of the foregoing, and all registrations and applications for registration of any of the foregoing, and all goodwill associated with and symbolized by the foregoing.

“ Facility ” is defined in the caption to this Agreement.

“ Final Asset Transfer Amount ” is defined in Section 14.5(b).

“ Final Determination Date ” is defined in Section 2.3(d).

“ Former Employee ” is defined in Section 14.4.

“ Governmental Entity ” means any government or any agency, bureau, board, commission, court, department, official, political subdivision, tribunal or other instrumentality of any government, whether federal, state or local, domestic or foreign.

“ HSR Act ” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the related regulations and published interpretations.

“ Indebtedness ” means obligations on account of money borrowed, bonds, debentures, notes or similar instruments, capitalized leases, letters of credit or guarantees.

“ Indemnifiable Claim ” means any Loss for or against which any party is entitled to indemnity under this Agreement.

 

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“ Indemnified Party ” means a party entitled to indemnity under this Agreement.

“ Indemnifying Party ” means a party obligated to provide indemnity under this Agreement.

“ Initial Purchase Price ” shall mean an amount equal to one hundred sixty million dollars ($160,000,000.00).

“ Intangible Property ” means the patents and patent applications, trade names, trademarks and goodwill associated therewith (including registrations or applications therefor), service marks, trade secrets, copyrights (including registrations or applications therefor) and computer software applications, software licenses and all other items of intellectual or intangible property throughout the world.

“ Interests ” is defined in the Recitals to this Agreement.

“ Investment ” means, with respect to a particular Person, a minority equity interest, held directly or indirectly by such Person.

“ IRS ” means the Internal Revenue Service or any successor entity.

“ Koppers ” is defined in the Recitals to this Agreement.

“ Koppers Actuary ” is defined in Section 14.5(b).

“ Koppers Benefit Plans ” is defined in Section 4.14(a).

“ Koppers Interests ” is defined in the Recitals to this Agreement.

“ Koppers Litigation ” means the lawsuit captioned Nicholas v. Staffieri filed against Koppers in the United States District Court for the Western District of Pennsylvania on May 13, 1997, and any related or successor claim in any court.

“ Law ” means any constitutional provision, statute, ordinance or other law, rule, regulation, or interpretation of any Governmental Entity and any Order, in each instance as in effect as of the date hereof.

“ Limited Liability Company ” is defined in the Recitals to this Agreement.

“ Loss ” means any action, cost, damage (excluding special, punitive, incidental or consequential damages), disbursement, expense, liability, loss, deficiency, obligation, penalty or settlement of any kind or nature, whether foreseeable or unforeseeable, including, but not limited to, interest or other carrying costs, penalties, and reasonable legal, accounting and other professional fees and expenses incurred in the investigation, collection, prosecution and defense of claims and amounts paid in settlement, that may be imposed on or otherwise incurred or suffered by the specified Person.

 

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“ Material Adverse Effect ” means a material adverse effect on the business, assets, financial condition, revenues or net income of the Partnership, taken as a whole, or on the ability of the Sellers or the Partnership to consummate the transactions contemplated hereby; provided , however , that none of the following will be deemed, individually or collectively, to constitute a “Material Adverse Effect”: (i) any changes, circumstances or effects resulting from or relating to changes or developments in the economy, interest rates, financial markets, securities markets or commodity markets or in the political climate generally or in any specific region; (ii) any changes in conditions or developments generally applicable to the industry in which the Partnership is involved; (iii) any changes in applicable Laws or accounting practices or conventions and (iv) any changes, circumstances or effects arising as a result of or otherwise related to the matters described in Sections 4.9(d) and 4.11(b)(1) of the Disclosure Schedule .

“ Material Contract ” is defined in Section 4.11(a).

“ Material Intangible Property ” is defined in Section 4.10(a).

“ Material Licenses ” is defined in Section 4.10(a).

“ Net Working Capital ” is defined in Section 2.3(d).

“ New Union Contract ” is defined in Section 8.4.

“ Non-Consenting Contract ” is defined in Section 6.9(b).

“ Non-Union Employees ” means Employees other than Union Employees.

“ Notice ” is defined in Section 6.5(c).

“ Notice of Adjustment ” is defined in Section 2.3(b).

“ Notified Parties ” is defined in Section 6.5(c).

“ Notifying Parties ” is defined in Section 6.5(c).

“ Objection Notice ” is defined in Section 2.3(c).

“ Order ” means any award, decision, decree, injunction, stay, judgment, order, ruling, subpoena, verdict, assessment or writ.

“ Owned Material Intangible Property ” is defined in Section 4.10(a).

“ PADEP ” means the Pennsylvania Department of Environmental Protection.

“ PADEP Consent Order ” means that Consent Order and Agreement dated December 29, 1994 by and between the PADEP and Koppers.

“ Partnership ” is defined in the Recitals to this Agreement.

 

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“ Partnership Agreement ” means the Amended and Restated Agreement of Limited Partnership dated December 1, 1999 by and between Koppers (formerly known as Koppers Industries, Inc.) and Carbon Investments, Inc., as amended.

“ PBGC ” is defined in Section 4.14(b).

“ Permit ” means any license, registration, permit, franchise, certificate of authority, approval, order or other similar authorization, or any waiver of the foregoing, required to be issued by any Governmental Entity.

“ Permitted Encumbrance ” means (i) any Encumbrances for Taxes not yet due and payable, (ii) mechanics liens arising or incurred in the ordinary course of business with respect to which the underlying obligation is not delinquent. the rights of any person claiming by, through or under Buyer, (iii) Encumbrances under equipment leases with third parties entered into in the ordinary course of business and (iv) in the case of tangible property, Encumbrances or defects of title which do not (a) secure an obligation to pay money in excess of $100,000, or (b) individually or in the aggregate, materially affect the use or value of such property as used in the Business through the Closing Date.

“ Per Claim Amount ” is defined in Section 12.5(b).

“ Per Claim Deductible ” is defined in Section 12.5(b).

“ Person ” means an association, a corporation, a limited liability company, an individual, a partnership, a joint venture, an estate, a trust, a union or any other entity or organization, including a Governmental Entity.

“ Purchase Price Allocation ” is defined in Section 13.2.

“ Retiree Life Plan ” means the employee welfare benefit plans sponsored by Koppers that provides retiree life insurance benefits to certain Union Employees and Non-Union Employees and in which such Union Employees and Non-Union Employees participate immediately prior to the Closing.

“ Retiree Medical Plan ” means the employee welfare benefit plan sponsored by Koppers that provides retiree medical benefits to certain and Non-Union Employees and in which such and Non-Union Employees participate immediately prior to the Closing.

“ Retirement Plan ” means the defined benefit plan of Koppers in which the Employees participate immediately prior to the Closing.

“ Sellers ” is defined in the caption to this Agreement.

“ Settlement Agreement ” is defined in Section 2.3(c).

“ Straddle Period ” means any Tax period beginning before and ending after the Closing Date.

 

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“ Subsidiary ” means, with respect to a particular Person, each Person a majority of the shares of stock or other equity interests of which are owned, directly or indirectly, by such particular Person.

“ Supply Contract ” is defined in Section 3.2(b).

“ Tangible Assets ” is defined in Section 4.9(b).

“ Tax ” means all amounts paid or payable to a Governmental Entity, whether foreign, federal, state, county or local taxes, charges, fees, levies, or other assessments of whatsoever kind or nature, including without limitation, all net income, gross income, gross receipts, sales, use, services, ad valorem, occupation, transfer, franchise, capital stock, profits, license, withholding, payroll, employment, unemployment, excise, estimated, severance, stamp, occupancy or property taxes, custom duties, assessments of charges of any kind whatever (together with any interest, penalty or addition to tax).

“ Tax Return ” means any return, report, declaration, estimate, information return or other document (including any related or supporting information) filed or required to be filed with any Governmental Entity with respect to Taxes.

“ Termination Notice ” is defined in Section 6.5(c).

“ Third Party Rights ” is defined in Section 4.10(b).

“ Title Company ” is defined in Section 6.8.

“ Transferred Employee ” is defined in Section 14.1(b).

“ True-Up Amount ” is defined in Section 14.5(c).

“ Unadjusted Purchase Price ” shall mean an amount equal to the Initial Purchase Price, plus (y) the dollar amount of the “net working capital” line item on the Current Financial Schedule.

“ Union ” is defined in Section 4.15.

“ Union Employees ” means those Employees whose employment is covered by the Union Contract.

“ Union Contract ” is defined in Section 4.15.

“ WARN Act ” is defined in Section 4.13(c).

 

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ARTICLE II

PURCHASE AND SALE OF INTERESTS

2.1 Purchase and Sale . At the Closing, upon the terms and subject to the conditions of this Agreement, (i) Koppers agrees to sell and deliver to Buyer, and Buyer agrees to purchase from Koppers, the Koppers Interests, free and clear of any Encumbrances, and (ii) CI agrees to sell and deliver to Buyer, and Buyer agrees to purchase from CI, the CI Interests, free and clear of any Encumbrances.

2.2 Purchase Price . The total purchase price for the Koppers Interests (the “ Koppers Purchase Price ”) shall be an amount equal to (x) 95% of the Adjusted Purchase Price, minus (y) the dollar amount (expressed as a positive number) of the Assumed Koppers Liabilities. The total purchase price for the CI Interests (the “ CI Purchase Price ”) shall be an amount equal to 5% of the Adjusted Purchase Price.

2.3 Purchase Price Adjustment .

(a) As promptly as practicable following the Closing Date, but in no event more than 60 business days after the Closing Date, Koppers shall prepare an updated version of the Current Financial Schedule as of the end of the day on the Closing Date (the “ Closing Financial Schedule ”). The Closing Financial Schedule shall reflect the same line items as are included in the Current Financial Schedule and shall be prepared in accordance with the specific principles set forth on Schedule 2.3 and in a manner consistent with the preparation of the Current Financial Schedule.

(b) Upon completion of the Closing Financial Schedule, Koppers shall promptly deliver the same to the Buyer, together with a notice (the “ Notice of Adjustment ”) setting forth (i) the dollar amount of the “net working capital” line item on the Closing Financial Schedule and (ii) the dollar amount of the “assumed Koppers liabilities” line item identified on the Closing Financial Schedule. The parties shall provide to one another, and to each of their respective advisors, reasonable access upon prior written request to such parties’ personnel, advisors, properties, books and records, in each case to the extent relevant to the preparation and analysis of the Closing Financial Schedule.

(c) Following receipt of the Closing Financial Schedule and the accompanying Notice of Adjustment, the Buyer will be afforded a period of 30 business days (the “ 30-Day Period ”) to review the Closing Financial Schedule and the Notice of Adjustment. At or before the end of the 30-Day Period, the Buyer will either (A) accept the calculation of the net working capital and/or assumed Koppers liabilities as set forth in the Notice of Adjustment or (B) deliver to the Sellers a written notice (an “ Objection Notice ”) identifying any calculations relating to the net working capital and/or assumed Koppers liabilities that the Buyer dispute together with a reasonably detailed explanation as to the basis for and amount of such dispute. The failure by the Buyer to deliver an Objection Notice within the 30-Day Period shall constitute the Buyer’s acceptance of the amount of the net working capital and/or assumed Koppers liabilities as set forth in the Notice of Adjustment. If the Buyer delivers an Objection Notice in a timely manner, then, within a further period of 20 business days from the end of the 30-Day Period, the parties and, if desired, their

 

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accountants will attempt to resolve in good faith any disputes relating to the net working capital and reach a written agreement (the “ Settlement Agreement ”) with respect thereto. Failing such resolution, any unresolved disputed items relating to the net working capital will be referred for final binding resolution to a mutually acceptable accounting firm (the “ Arbitrating Accountants ”), the fees and expenses of which shall be paid by the Buyer. The amount of the net working capital will be deemed to be as determined by the Arbitrating Accountants. Such determination (the “ Accountants’ Determination ”) shall be (A) in writing, (B) furnished to Buyer and Sellers as soon as practicable after the items in dispute have been referred to the Arbitrating Accountants, (C) made in a manner consistent with the preparation of the Current Financial Schedule, and (D) nonappealable and incontestable by the parties hereto and each of their respective stockholders, partners, members, managers, Affiliates and successors and not subject to collateral attack for any reason other than manifest error or fraud.

(d) For purposes this Section 2.3, the “ Final Determination Date ” shall mean the earliest to occur of (A) the thirty-first business day following the receipt by the Buyer of the Closing Financial Schedule and accompanying Notice of Adjustment provided the Buyer shall have failed to deliver an Objection Notice to Sellers within the 30-Day Period, (B) the date on which the Buyer gives the Sellers a written notice to the effect that the Buyer has no objection to the Sellers’ determination of the net working capital, (C) the date on which the Buyer and Sellers execute and deliver a Settlement Agreement, and (D) the date as of which the Buyer and Sellers shall have received the Accountants’ Determination. For purposes of this Agreement, “ Net Working Capital ” shall mean the dollar amount of the “net working capital” line item on the Closing Financial Schedule and “ Assumed Koppers Liabilities ” shall mean the dollar amount of the “assumed Koppers liabilities” line item on the Closing Financial Schedule, in each case as finally determined in accordance with the procedures in this Section 2.3.

(e) Post Closing Adjustment . The following payments shall be made promptly following the Final Determination Date, in each case to the extent required based upon the final calculation of the Net Working Capital and the Assumed Koppers Liabilities in accordance with this Section 2.3:

(i) The “ Koppers Adjustment Amount ” shall be the amount determined in accordance with the following formula: (x) 95% of the result obtained by taking (A) the Net Working Capital and subtracting (B) the dollar amount of the “net working capital” line item on the Current Financial Schedule, plus (y) the result obtained by taking (A) the Assumed Koppers Liabilities and subtracting (B) the dollar amount of the “assumed Koppers liabilities” line item on the Current Financial Schedule. If the Koppers Adjustment Amount is positive, then Buyer shall deliver or cause to be delivered to Koppers an amount equal to the Koppers Adjustment Amount, plus interest thereon from the Closing Date through the date of payment calculated at the Agreed Rate. If the Koppers Adjustment Amount is negative, then Koppers shall deliver or cause to be delivered to Buyer an amount equal to the absolute value of the Koppers Adjustment Amount, plus interest thereon from the Closing Date through the date of payment calculated at the Agreed Rate.

 

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(ii) The “ CI Adjustment Amount ” shall be the amount determined in accordance with the following formula: 5% of the result obtained by taking (A) the Net Working Capital and subtracting (B) the dollar amount of the “net working capital” line item on the Current Financial Schedule. If the CI Adjustment Amount is positive, then Buyer shall deliver or cause to be delivered to CI an amount equal to the CI Adjustment Amount, plus interest thereon from the Closing Date through the date of payment calculated at the Agreed Rate. If the CI Adjustment Amount is negative, then CI shall deliver or cause to be delivered to Buyer an amount equal to the absolute value of the CI Adjustment Amount, plus interest thereon from the Closing Date through the date of payment calculated at the Agreed Rate.

(f) To the extent there is a disagreement between Koppers and Buyer concerning the amount of the Net Pension Liability that comprises the assumed Koppers liabilities line item on the Closing Financial Schedule as a result of the failure of Koppers and Buyer to have agreed upon the amount of the Assumed Retirement Liabilities in Section 14.5 of this Agreement, then the parties agree that they will (i) exclude the Net Pension Liability line item from the calculation of the assumed Koppers liabilities for purposes of this Section 2.3, but otherwise comply with the provisions of this Section 2.3 with respect to all other amounts, (ii) resolve any disagreement regarding the amount of the Net Pension Liability pursuant to Section 14.5, and (iii) within 10 days of the final determination of the amount of the Net Pension Liability pursuant to Section 14.5, make any additional payments as required to reflect the final amount of the Net Pension Liability as if it had been included in the original calculation of the assumed Koppers liabilities.

ARTICLE III

CLOSING

3.1 Closing Date . The Closing shall take place at the offices of Reed Smith LLP, 435 Sixth Avenue, Pittsburgh, Pennsylvania 15219, on the last business day of the month during which the conditions specified in Articles VIII, IX and X shall have been satisfied or waived, or at such other place or on such other date as Koppers and Buyer may agree. The Closing shall be effective as of 11:59 PM eastern standard time on the Closing Date.

3.2 Items to be Delivered at the Closing by Koppers . At the Closing, Koppers shall deliver or cause to be delivered:

(a) A duly and validly authorized and executed copy of the Assignment and Assumption of Interests (the “ Assignment ”) in the form of Exhibit A .

(b) To the Limited Liability Company, a copy of the Coal Tar Supply Contract (the “ Supply Contract ”) in the form of Exhibit B-1 hereto, as revised to reflect the terms described in Exhibit B-2 hereto, duly executed by Koppers.

(c) Any and all of the Partnership’s and the Limited Liability Company’s records and documents relating to the Business.

(d) An executed certificate of a duly authorized officer of Koppers, dated as of the Closing Date, certifying that the conditions contained in Sections 9.1(a), 9.1(b), 9.2 and 9.3(b) have been satisfied to the extent such conditions relate to Koppers as a Seller.

 

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3.3 Items to be Delivered at the Closing by CI . At the Closing, CI shall deliver or cause to be delivered:

(a) A duly and validly authorized and executed copy of the Assignment.

(b) An executed certificate of a duly authorized officer of CI, dated as of the Closing Date, certifying that the conditions contained in Sections 9.1(a), 9.1(b) and 9.2 have been satisfied to the extent such conditions relate to CI as a Seller.

3.4 Items to be Delivered at the Closing by Buyer . At the Closing, Buyer shall deliver or cause to be delivered:

(a) To Koppers, by wire transfer in funds immediately available, an amount equal to (i) the Unadjusted Purchase Price, minus (ii) the dollar amount (expressed as a positive number) of the “assumed Koppers liabilities” line item on the Current Financial Schedule (it being understood that, promptly following the Closing, Koppers shall deliver to CI an amount equal to 5% of the Unadjusted Purchase Price, less transaction expenses and fees attributable to CI).

(b) To each applicable Seller, a duly and validly authorized receipt of Assignment, which shall have been duly executed by the applicable Buyer.

(c) To Koppers, the Supply Contract in the form of Exhibit B-1 hereto, as revised to reflect the terms described in Exhibit B-2 hereto, duly executed by Buyer and Koppers.

(d) An executed certificate of a duly authorized officer of Buyer, dated the Closing Date, certifying that the conditions contained in Article X have been satisfied.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF SELLERS

Each representation and warranty contained in this Article IV is qualified by the disclosures made with respect to such representation and warranty in the Disclosure Schedule attached to this Agreement (the “ Disclosure Schedule ”). Except as set forth on the Disclosure Schedule, Koppers hereby makes the representations and warranties to Buyer set forth in Sections 4.1, 4.2(a), 4.3, 4.4(a), 4.4(c), 4.4(e), 4.5, 4.6, 4.7(a), 4.8, 4.9, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 4.16, 4.17, 4.18, 4.19 and 4.20 and CI hereby makes the representations and warranties to Buyer set forth in Sections 4.2(b), 4.4(b), 4.4(d) and 4.7(b).

4.1 Organization and Related Matters . The Partnership is a limited partnership duly formed, validly existing and in good standing under the laws of the State of Delaware, and has full partnership power and authority to carry on the Business as currently conducted. At Closing, the Limited Liability Company shall be a limited liability company duly formed, validly existing and in good standing under the laws of the State of Delaware, and shall have full power and authority to carry on the Business as currently conducted.

 

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4.2 Capitalization .

(a) Koppers is the record and beneficial owner and holder of the Koppers Interests free and clear of all Encumbrances. At the Closing, Koppers will transfer to Buyer the Koppers Interests free and clear of all Encumbrances. Other than this Agreement and the Partnership Agreement, there are no Contracts relating to the sale or transfer of the Koppers Interests. The Koppers Interests have been issued in compliance with all applicable Laws. There are no outstanding contractual obligations of the Partnership, and at Closing there will be no such outstanding obligations of the Limited Liability Company, to repurchase, redeem or otherwise acquire the Koppers Interests or to provide funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in, any other Person. The Koppers Interests and the CI Interests represent all of the interests in the Partnership, and at Closing will represent all of the interests in the Limited Liability Company.

(b) CI is the record and beneficial owner and holder of the CI Interests free and clear of all Encumbrances. At the Closing, CI will transfer to Buyer the CI Interests free and clear of all Encumbrances. Other than this Agreement and the Partnership Agreement, there are no Contracts relating to the sale or transfer of the CI Interests. The CI Interests have been issued in compliance with all applicable Laws. There are no outstanding contractual obligations of the Partnership, and at Closing there will be no such outstanding obligations of the Limited Liability Company, to repurchase, redeem or otherwise acquire the CI Interests.

4.3 Subsidiaries and Investments . The Partnership has no Subsidiaries or Investments.

4.4 Authorization; No Conflicts; Consents .

(a) The execution, delivery and performance of this Agreement, the Conversion and the Assignment by Koppers have been duly and validly authorized by all necessary corporate action on the part of Koppers. This Agreement and, upon consummation of the Closing, the Assignment, constitute the legally valid and binding obligations of Koppers, enforceable against Koppers in accordance with their terms except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws relating to or limiting creditors’ rights generally and by general principles of equity and public policy.

(b) The execution, delivery and performance of this Agreement, the Conversion and the Assignment by CI have been duly and validly authorized by all necessary corporate action on the part of CI. This Agreement and, upon consummation of the Closing, the Assignment, constitute the legally valid and binding obligations of CI, enforceable against CI in accordance with their terms except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws relating to or limiting creditors’ rights generally and by general principles of equity and public policy.

(c) The execution, delivery and performance of this Agreement, the Conversion and the Assignment by Koppers and the consummation of the transactions contemplated hereby, will not (i) violate the charter documents or bylaws of either Koppers or the Partnership or the Limited Liability Company, (ii) assuming receipt of Approvals listed in

 

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Section 4.4 of the Disclosure Schedule , violate or constitute a breach or default (whether upon lapse of time and/or the occurrence of any act or event or otherwise) under any Material Contract or (iii) assuming receipt of the Approvals and Permits listed in Section 4.4 of the Disclosure Schedule , violate any Law. Except for matters identified in Section 4.4 of the Disclosure Schedule , the execution, delivery and performance by Koppers of this Agreement, and the consummation of the transactions contemplated hereby and thereby, will not require any Approval or Permit by any Governmental Entity or other Person. The execution, delivery and performance of this Agreement, the Conversion and the Assignment by CI and the consummation of the transactions contemplated hereby, will not (i) violate the charter documents of the Partnership or the Limited Liability Company, (ii) assuming receipt of Approvals listed in Section 4.4 of the Disclosure Schedule , violate or constitute a breach or default (whether upon lapse of time and/or the occurrence of any act or event or otherwise) under any Material Contract or (iii) assuming receipt of the Approvals and Permits listed in Section 4.4 of the Disclosure Schedule , violate any Law.

(d) The execution, delivery and performance of this Agreement, the Conversion and the Assignment by CI and the consummation of the transactions contemplated hereby, will not violate the charter documents or bylaws of CI. Except for matters identified in Section 4.4 of the Disclosure Schedule , the execution, delivery and performance by CI of this Agreement, and the consummation of the transactions contemplated hereby and thereby, will not require any Approval or Permit by any Governmental Entity or other Person.

(e) The execution, delivery and performance of the Supply Contract by Koppers has been duly and validly authorized by all necessary corporate action. When executed, the Supply Agreement will constitute the legally valid and binding obligation of Koppers, enforceable against Koppers in accordance with its terms except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws relating to or limiting creditors’ rights generally and by general principles of equity and public policy.

4.5 Legal Proceedings . Except for the Koppers Litigation, there is no Action pending, or, to Koppers’ knowledge, threatened, against the Partnership or that otherwise relates to the Business, nor is there any Order existing against the Partnership or that otherwise relates to the Business or the Facility, that individually or when aggregated with one or more other Actions or Orders has had, or would reasonably be expected to have, a Material Adverse Effect.

4.6 Compliance with Law .

(a) Each of the Business and the Partnership has been conducted in all material respects in accordance with all applicable Laws. The Partnership has not received notice of any violation of any Law applicable to and material to the Partnership, the Business or the consummation of the transactions contemplated by this Agreement.

 

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(b) Except as to Environmental Permits and Environmental Laws, which are addressed exclusively in Section 4.17 of this Agreement, (i) the Partnership has complied in all material respects with the terms of any applicable Permits, and has not received written notification from any Governmental Entity of any violation of any Permit or any Law governing the issuance or continued validity thereof which is material to the Partnership, the Business or the consummation of the transactions contemplated by this Agreement and (ii) the Partnership has all material Permits required in connection with the conduct of the Business.

4.7 No Brokers or Finders .

(a) No agent, broker, finder, or investment or commercial banker, or other Person engaged by Koppers or an Affiliate of Koppers in connection with the negotiation, execution or performance of this Agreement or the transactions contemplated by this Agreement is or will be entitled to any brokerage or finder’s or similar fee or other commission as a result of this Agreement or such transactions except for certain fees payable to UBS Investment Bank as to which fees Sellers shall have full responsibility and neither Buyer nor the Partnership shall have any liability.

(b) No agent, broker, finder, or investment or commercial banker, or other Person engaged by CI or an Affiliate of CI in connection with the negotiation, execution or performance of this Agreement or the transactions contemplated by this Agreement is or will be entitled to any brokerage or finder’s or similar fee or other commission as a result of this Agreement or such transactions except for certain fees payable to UBS Investment Bank as to which fees Sellers shall have full responsibility and neither Buyer nor the Partnership shall have any liability.

4.8 Financial Schedule; No Material Liabilities .

(a) Koppers has made available to the Buyer an unaudited financial schedule of the Partnership as of June 30, 2008, a copy of which is attached to this Agreement as Exhibit C (the “ Current Financial Schedule ”) setting forth the net assets and assumed liabilities of the Business as of such date. The Current Financial Schedule was prepared in accordance with the policies set forth in Schedule 2.3 and fairly presents in accordance with the policies set forth in Schedule 2.3 the financial condition of the Business as of June 30, 2008.

(b) Koppers has made available to the Buyer a Statement of Operations of the Partnership for the six month period ended June 30, 2008 and the year ended December 31, 2007, a copy of which is attached to this Agreement as Exhibit C-2 (the “ Statements of Operations ”) setting forth the results of operations of the Business for each such period. Each of the Statements of Operations fairly presents the financial results of the Business for the relevant period. In addition, the Statement of Operations reconciles the tax basis results of the Partnership to amounts reflected in Koppers’ underlying books and records which are prepared in accordance with applicable generally accepted accounting principles.

(c) There are no liabilities of the Business, other than the liabilities (i) reflected on the Current Financial Schedule, (ii) disclosed in Section 4.8(c) of the Disclosure Schedule , (iii) incurred since the date of the Current Financial Schedule in the ordinary course of business, consistent with past practice or (iv) that would not, individually or in the aggregate, have a Material Adverse Effect.

 

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(d) Since the date of the Current Financial Schedule, there has not been any Material Adverse Effect and, except with respect to actions permitted under Section 6.2 of this Agreement during the period between the date of this Agreement and Closing, the Business has been conducted in the ordinary course consistent with past practice. Except as set forth in Section 4.8(d) of the Disclosure Schedule , and except with respect to actions permitted under Section 6.2 of this Agreement during the period between the date of this Agreement and Closing, since the date of the Current Financial Schedule there has not been any (i) change in any of the interests of the Partnership; grant of any option or right to purchase any interests of the Partnership; issuance of any security convertible or exchangeable into such interests; (ii) amendment to the Partnership Agreement; (iii) entry into, termination of, amendment, waiver or receipt of notice of termination of any Material Contract, except for such entry, termination, amendment or waiver that has not had and is not reasonably expected to have a Material Adverse Effect; (iv) sale, lease or other disposition of any material asset or property of the Partnership or the Business, or mortgage, pledge or imposition of any Encumbrance, other than Permitted Encumbrances, on any material asset or property of the Partnership or the Facility; (v) material change in the accounting methods or policies used by the Partnership or (vi) agreement, whether written or oral, to do any of the foregoing.

4.9 Real Property; Tangible Assets .

(a) The Partnership owns all of the real property on which the Facility is located, which is described in detail on Section 4.9(a) of the Disclosure Schedules (the “ Real Property ”). Except for the Facility, the Partnership does not own or lease any other real property. Except as described in Section 4.9(a) of the Disclosure Schedule , the Partnership has good and marketable title to the Real Property free and clear of any Encumbrances, other than Permitted Encumbrances. No Person other than the Partnership is entitled to possession of the Real Property, and there are no leases, subleases or licenses granting to any third party the right of use or occupy of any portion of the Real Property. There are no outstanding options, rights of first refusal or other preferential rights to purchase, lease, occupy or otherwise use the Real Property or any portion thereof or interest therein. The plants, buildings and structures located on the Real Property currently have (i) access to water supply, storm and sanitary sewer facilities, telephone, gas and electrical connections, fire protection, drainage and other public utilities, in each case as is necessary for the conduct of the Business as it is presently conducted and (ii) adequate rights of access to dedicated public ways. Except for such plants, buildings or structures not material to the operation of the Business, the plants, building and structures of the Facility are in good operating condition and in a state of good maintenance and repair, ordinary wear and tear excepted, and are structurally sound. There are no condemnation or appropriation or similar proceedings pending or, to Koppers’ knowledge, threatened against the Real Property.

 

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(b) To Koppers’ knowledge: (i) there are no violations of any zoning ordinances, building codes or other governmental or regulatory laws affecting the Real Property or planned material changes in any zoning ordinances or building codes or other governmental or regulatory laws, other than Environmental Laws, that would affect the Real Property, (ii) any variance, conditional use permit, special use permit or other similar approval required for operation of the Facility has been obtained and remains in effect and (iii) other than Environmental Laws, there are no planned or commenced public improvements related to the Real Property that may result in material special assessments against any part of the Real Property, except in each case as would not have a Material Adverse Effect.

(c) Except as set forth in Section 4.9(c) of the Disclosure Schedule , the Partnership owns and has good and marketable title to all of the tangible assets listed on Schedule 4.9(c) of the Disclosure Schedule (the “ Tangible Assets ”). Except as described in Section 4.9(c) of the Disclosure Schedule , the Tangible Assets are free and clear of all Encumbrances other than Permitted Encumbrances and constitute all of the property necessary for the conduct of the Business as currently conducted.

(d) Except as set forth in Section 4.9(d) of the Disclosure Schedule , production at the Facility since December 31, 2007 has continued in the ordinary course, consistent with past practice and substantially similar output has been produced on a monthly basis during 2008 compared to output in the corresponding months during the prior three (3) years.

4.10 Intangible Property .

(a) Section 4.10(a) of the Disclosure Schedule lists all Intangible Property which is material to the Business as presently conducted (the “ Material Intangible Property ”). Part I of Section 4.10(a) of the Disclosure Schedule lists all Material Intangible Property owned by the Partnership (“ Owned Material Intangible Property ”). Part II of Section 4.10(a) of the Disclosure Schedule also lists all Material Intangible Property which is owned by third parties and the agreement pursuant to which Koppers is licensed to use (in connection with the operation of the Business) any Material Intangible Property (“ Material Licenses ”). The Partnership has good title to the Owned Material Intangible Property. The Partnership has the right to use the Intangible Property covered by each Material License in the operation of the Business as currently conducted in accordance with the terms of such Material License.

(b) As of the date of this Agreement, the Partnership owns or has a valid license to use all of the Material Intangible Property used in or necessary for the operation of the business of the Partnership and its subsidiaries.

(c) Except as set forth in Section 4.10(c) of the Disclosure Schedule , there is no pending reexamination, opposition, interference, cancellation, invalidation or other Action against the Partnership with respect to any Material Intangible Property. Except as set forth in Section 4.10(c) of the Disclosure Schedule or as would not be reasonably expected to have a Material Adverse Effect, (i) there are no pending or, to Koppers’ knowledge, threatened written claims against the Partnership alleging that use of the Material Intangible Property by the Partnership in connection with the Business infringes or conflicts with the rights of others in the Material Intangible Property (“ Third Party Rights ”); (ii) the Partnership has not received any complaint, claim or notice alleging that it has violated or, by using the

 

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Material Intangible Property in connection with the Business as now conducted, would violate any Third Party Rights or that any Material Intangible Property owned by it are invalid or unenforceable; and (iii) no consent judgment or pending litigation in a court of law exists to which the Partnership is a party, which would prevent the Partnership from using any of the Material Intangible Property in the Business now conducted.

(d) To Koppers’ Knowledge, all of the material computer networks, systems, software, and hardware used by the Facility (the “ IT Systems ”) are in good working order and the Facility has not experienced any material defects in design, workmanship or material in connection with their use. To Koppers’ Knowledge, the IT Systems are free of all viruses, worms, trojan horses and other material known contaminants, and do not contain any bugs, errors, or problems of a material nature that could disrupt its operation.

(e) Except as identified in Section 4.10(e) of the Disclosure Schedule , the Partnership has not granted material rights to others in the Material Intangible Property.

4.11 Material Contracts .

(a) Section 4.11(a) of the Disclosure Schedule identifies all of the following Contracts (each a “ Material Contract ”) to which the Partnership is a party or which relates to the Business or the Facility:

(i) Contracts for the purchase or sale of assets by or of the Partnership having a value in excess of $100,000 in any calendar year;

(ii) Contracts containing covenants of the Partnership not to compete in any line of business, with any Person or in any geographical area or not to offer or sell any product or service to any Person or class of Persons;

(iii) Any employment contracts between the Partnership or Koppers and any individual and any collective bargaining agreement with respect to the Business;

(iv) Contracts relating to the incurrence of Indebtedness by the Partnership;

(v) Contracts with customers involving the provision of goods or services for which the aggregate consideration will exceed $100,000 in any calendar year;

(vi) All Material Licenses;

(vii) Contracts which grant to any third party a license to any Owned Material Intangible Property;

(viii) Contracts with vendors or suppliers of goods or services for which the aggregate consideration will exceed $100,000 in any calendar year;

 

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(ix) Contracts involving a termination fee or otherwise requiring payment in exchange for the right to terminate such agreement, in each case in excess of $100,000;

(x) Contracts which contain any non-compete, grant of exclusivity, most-favored-pricing clauses or otherwise operate to restrict or limit the operation of the Partnership or the Business;

(xi) Contracts which constitute (a) an outsourcing arrangement of any material systems or operations of the Partnership or (b) a joint venture or joint development agreement;

(xii) Any joint venture, alliance, partnership or other similar agreement;

(xiii) Any agreement creating or purporting to create an Encumbrance (other than a Permitted Encumbrance) on a material asset;

(xiv) Any contracts with an Affiliate of either Seller which exceed, in the aggregate, $100,000; and

(xv) Any other agreement or commitment not made in the ordinary course of business in excess of $100,000.

(b) Except as set forth in Section 4.11(b) of the Disclosure Schedule or as would not be reasonably expected to have a Material Adverse Effect, (i) the Partnership is not in, nor alleged to be in, default under any Material Contract, (ii) to Koppers’ knowledge, there is no default by any other party to any Material Contract, and (iii) there exists no event, condition or occurrence which, after notice or lapse of time, or both, is reasonably likely to constitute a default by the Partnership, or to Koppers’ knowledge, any other Person, under a Material Contract. All of the Material Contracts are in full force and effect and constitute legal, valid and binding obligations of the parties thereto in accordance with their terms, and, except as set forth in Section 4.11(b) of the Disclosure Schedule , will remain in full force and effect after the Closing without any Approval by any other party, except as contemplated by Sections 4.4 hereof.

4.12 Insurance . Section 4.12 of the Disclosure Schedule lists all insurance policies currently held by Koppers that relate to the Business or the Facility together with each loss control survey report provided to Koppers in respect of the Facility within the past six months. No event relating to the Business or the Partnership has occurred which will result in cancellation of any such insurance policies. Neither the Partnership nor the Business is in default under any such insurance policies and all premiums owed thereunder have been paid, and no material claims for coverage thereunder have been denied, except for any such failures as would not have a Material Adverse Effect.

 

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4.13 Employees .

(a) Section 4.13(a) of the Disclosure Schedule sets forth the following information for each Employee: name; job title; current salary or hourly rate, as applicable, annual target bonus, if any; and service date or any adjusted service date reflecting service credit for prior employment. All of the employees of the Business are employed by Koppers, and the Partnership does not employ any Persons.

(b) Except for the production Employees who are members of the Union, (i) none of the Employees have, or are subject to, contracts of employment with Koppers or the Partnership, (ii) all Employees are employees “at will” whose employment is terminable without liability therefor (other than liability for severance payments or liability for retention or stay payments), and (iii) none of the Employees have, or are subject to, contracts or other agreements relating to stay bonuses and offer letters providing for retention or stay payments, commissions, compensation, special monetary or vacation awards, non-compete provisions or agreements, perquisites, warrants or other benefits to Employees; except in all cases that would not have a Material Adverse Effect.

(c) In the three (3) years prior to the date hereof, neither Koppers nor the Partnership has effectuated (i) a “plant closing” (as defined in the Worker Adjustment and Retraining Notification Act (the “ WARN Act ”) or any similar Law) affecting employees employed by Koppers in connection with the operation of the Business at the Facility or that would otherwise be required to be aggregated under the WARN Act with any other layoffs or terminations that would include any Employees or (ii) a “mass layoff” (as defined in the WARN Act, or any similar Law) affecting employees employed by Koppers in connection with the operation of the Business at the Facility or that would otherwise be required to be aggregated under the WARN Act with any other layoffs or terminations that would include any Employees. Neither Koppers nor the Partnership has laid off any employees employed by Koppers in connection with the operation of the Business at the Facility in the ninety (90) calendar days prior to the date hereof, nor has Koppers laid off any employees as part of any layoff that would be required to be aggregated under the WARN Act with any other layoffs or terminations that would include any Employees.

4.14 Benefit Plans .

(a) All Employee Benefit Plans which provide benefits or coverages to any Employee or with respect to which the Partnership has or could be reasonably expected to have any obligation to contribute or other liability(collectively, the “ Koppers Benefit Plans ”) are listed in Section 4.14(a) of the Disclosure Schedule . The Retirement Plan and any Koppers’ Benefit Plan which permits contributions described in Code Section 401(k) on behalf of Transferred Employees meet the requirements for qualification under Section 401(a) of the Code, and there are no facts or circumstances that would reasonably be expected to result in the disqualification of such plans under Section 401(a) of the Code. The Partnership does not maintain or contribute to, or otherwise have any liability with respect to, any Employee Benefit Plans other than the Koppers Benefit Plans. Koppers has made available to Buyer true and complete copies of the most recent Form 5500