Exhibit P
STOCK PURCHASE AGREEMENT
________________________
This STOCK PURCHASE AGREEMENT ("Agreement") is made and
entered into this 22nd day of November, 1999, by and between
KAISER VENTURES INC., a Delaware corporation, ("Kaiser") and the
Pension Benefit Guaranty Corporation ("PBGC").
RECITALS
A. PBGC owns shares of the $.03 par value common stock of
Kaiser which PBGC received in connection with the Chapter 11
bankruptcy reorganization of Xxxxxx Steel Corporation.
B. The Board of Directors of Kaiser, having considered the
recommendations of its duly authorized Independent Special
Committee, has determined that the acquisition by Kaiser of the
PBGC Shares (as defined below) is in the best interests of the
nonselling shareholders of Kaiser.
C. The parties desire to enter this Agreement and to pursue
the transaction contemplated hereby (the "Transaction") pursuant
to which Kaiser will purchase 1,693,551 shares of the Kaiser
common stock (the "PBGC Shares") owned by PBGC upon the terms and
conditions of this Agreement.
NOW, THEREFORE, for and in consideration of the mutual
promises and covenants contained herein, and for other good and
valuable consideration, the parties hereto agree as follows:
1. Purchase and Sale of Shares. Subject to the terms and
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conditions of this Agreement, Kaiser hereby purchases from PBGC,
and PBGC hereby sells to Kaiser, the PBGC Shares.
2. Purchase Price and Payment Terms. The purchase price
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payable by Kaiser to PBGC for the PBGC Shares (the "Purchase
Price") consists of (i) a fixed per share payment (ii) Warrants,
and (iii) a contingent payment, which is being paid as follows:
2.1 Fixed Payment. A fixed payment of $13.00 per
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share for a total fixed purchase price of $22,016,163 paid by
wire transfer of immediately available funds contemporaneously
herewith.
2.2 Warrant. Contemporaneously herewith, Kaiser is
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delivering to PBGC a warrant, in the form attached hereto as
Exhibit A (the "Warrant"), to purchase 285,260 shares of Kaiser
Common Stock.
2.3 Contingent Payment. In addition, PBGC will have
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the right to receive a contingent payment (the "Contingent
Payment") on the terms and conditions of the Contingent Payment
Agreement in the form attached hereto as Exhibit B.
3. Representations and Warranties of Kaiser. Kaiser
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represents and warrants to PBGC:
(a) Organization and Authorization. Kaiser has been
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duly incorporated, is validly existing and in good standing under
the laws of the State of Delaware. The execution, delivery and
performance of this Agreement, the Warrant, the Contingent
Payment Agreement and the Registration Rights Agreement (as
hereafter defined) have been duly authorized by all
requisite action. No charter, bylaw, material agreement,
material document or material instrument of any kind of which
Kaiser is a party or by which it may be bound would be violated
by the Transaction. Kaiser has full power and authority to
execute and deliver this Agreement and to perform its
obligations hereunder. This Agreement, the Warrant, the
Contingent Payment Agreement and the Registration Rights
Agreement constitute the valid and legally binding obligation of
Kaiser, enforceable in accordance with its terms and conditions,
subject to bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting or relating to creditors' rights
generally. Kaiser need not give any notice to, make any filing
with, or obtain any authorization, consent, or approval of any
government or governmental agency in order to consummate the
transactions contemplated by this Agreement. The Transaction
does not contravene any applicable law, rule, or regulation or
any order or decree binding on Kaiser. A true and correct copy
of the resolutions of the Independent Committee of the Board of
Directors of Kaiser and those of the Board of Directors of Kaiser
approving the Transaction had previously been delivered to PBGC
and are attached to the opinion of counsel provided to PBGC.
Prior to adopting those resolutions, the Independent Committee
and the Board of Directors of Kaiser received an opinion from
Xxxxxxx Xxxxx as to the fairness of the Transaction to the
nonselling shareholders of Kaiser.
(b) Consents. Kaiser has obtained any necessary third
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party consent or approval that may be required to be obtained by
it to complete the Transaction.
(c) Brokers. Except for Xxxxxxx Xxxxx, whose fees
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shall be the sole obligation of Kaiser, Kaiser has not employed
any broker or finder in connection with the Transaction, and
shall hold PBGC harmless from any liability or loss as a result
of or in connection with any brokerage or finder's fee or other
commission of any person retained by Kaiser in connection with
the Transaction.
(d) No Material Adverse Changes. Since December 31,
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1998, there has not been any material adverse changes in the
business, financial condition, operations, results of operations,
or future prospects of Kaiser and no material transactions
involving Kaiser are pending including any material transactions
involving Mine Reclamation Corporation or Mill Site, except as
disclosed (a) to the public in press releases or filings with the
Securities and Exchange Commission or (b) to the representatives
of the PBGC in writing at the Board of Directors meeting at which
this Agreement was approved.
4. Representations and Warranties of PBGC. PBGC hereby
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represents and warrants to Kaiser as follows:
(a) Organization and Authorization. PBGC is a
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corporation that has been duly formed, is validly existing and in
good standing under federal law. The execution, delivery and
performance of this Agreement and the Registration Rights
Agreement have been duly authorized by all requisite
action as necessary. No trust document, bylaw, material
agreement, material document, or material instrument of any kind
of which PBGC is party or by which it may be bound would be
violated by the Transaction. This Agreement and the Registration
Rights Agreement constitute the valid and legally binding
obligation of PBGC, enforceable in accordance with its terms and
conditions, subject to bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting or relating to
creditors' rights generally. PBGC need not give any notice to,
make any filing with, or obtain any authorization, consent, or
approval of any government or governmental agency in order to
consummate the transactions contemplated by this Agreement. The
Transaction does not contravene any applicable law, rule, or
regulation or any order or decree binding on PBGC.
(b) Consents. PBGC has obtained any necessary third
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party consent or approval that may be required to be obtained by
it to complete the Transaction.
(c) Ownership. PBGC is the record and beneficial
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owner of 2,100,966 shares of the common stock of Kaiser,
including the PBGC Shares. PBGC has and Kaiser will receive
title to the PBGC Shares, free and clear of all security
interests, liens, claims, pledges, options, rights of first
refusal, agreements, charges or other encumbrances of any nature
whatsoever.
(d) Warrant Representations. The Warrant and the
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Shares for which it is being exercisable are being acquired for
investment for PBGC's own account, not as a nominee or agent, and
not with a view to the sale or distribution of all or any part
thereof in violation of applicable securities laws. PBGC has the
requisite knowledge and experience to assess the relative merits
and risks of an acquisition of the Warrant and such shares. PBGC
is an "accredited investor" as that term is defined by Rule
501(a) promulgated under the Securities Exchange Act of 1933, as
amended. The PBGC understands that each certificates for the
Warrant and such shares may be legended as a result of the
application of Securities and Exchange Commission Rule 144.
(e) Authority of Pacholder Associates, Inc. The PBGC
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has appointed Pacholder Associates, Inc. ("Pacholder") as the
PBGC's agent with respect to the matters contemplated by this
Agreement, with full authority to act on behalf of the PBGC.
(f) Brokers. Except with respect to its agreement
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with Pacholder, PBGC has not employed any broker or finder in
connection with the Transaction, and shall hold Kaiser harmless
from any liability or loss as a result of or in connection with
any brokerage or finder's fee or other commission of any person
retained by PBGC in connection with the Transaction.
5. Other Documents.
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(a) Legal Opinion from PBGC's Counsel. Kaiser has
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received a legal opinion from PBGC's legal counsel to the effect
that: (a) this Agreement and the Registration Rights Agreement
have been duly authorized by required legal action on the part of
PBGC; (b) the Transaction does not contravene any applicable law,
rule, or regulation or any order or decree binding on PBGC; and
(c) the completion of the Transaction on the part of PBGC does
not require the consent or authorization of any governmental
authority that has not been obtained.
(b) Legal Opinion from Xxxxxx'x Counsel. PBGC has
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received a legal opinion from Xxxxxx'x legal counsel to the
effect that: (a) this Agreement, the Warrant, the Contingent
Payment Agreement and the Registration Rights Agreement have been
authorized by required legal action on the part of Kaiser; (b)
the Transaction does not contravene any applicable law, rule, or
regulation or any order or decree binding on Kaiser; and (c) the
completion of the Transaction on the part of Kaiser does not
require the consent or authorization of any governmental
authority that has not been obtained.
6. Limited Stock Lock-Up. PBGC agrees that, without the
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prior written consent of Kaiser, which consent Kaiser may grant
or deny in its sole and absolute discretion, PBGC will not offer,
sell, contract to sell, pledge or otherwise dispose of
("Transfer"), directly or indirectly, any shares of: (i) Kaiser
Common Stock or (ii) any securities convertible into or
exercisable or exchangeable for Kaiser Common Stock, nor will it
publicly disclose the intention to make any such Transfer, for a
period of 180 days after the dates thereof as specified in this
Agreement. Kaiser and its transfer agent and registrar are
hereby authorized by PBGC to decline to make any Transfer of
shares of Kaiser Common Stock if such Transfer would constitute a
violation or breach of this Agreement. A copy of this paragraph
shall be sufficient notice of these restrictions to Xxxxxx'x
stock transfer agent and registrar. In addition, Kaiser and PBGC
are entering into the Registration Rights Agreement in the form
attached hereto as Exhibit C (the "Registration Rights
_________
Agreement").
7. Resignations. On execution hereof, PBGC has delivered
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to Kaiser an executed irrevocable resignation for the PBGC
affiliated individual currently serving on Xxxxxx'x Board of
Directors.
8. Survival of Existing Indemnities. The existing rights
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to indemnification in favor of the present or former directors,
officers, employees and agents of Kaiser (from November 1, 1988,
forward only) and its subsidiaries shall survive the Transaction
and shall continue in full force and effect following the date
hereof. For at least four years after the date thereof, Kaiser
(i) shall use commercially reasonable efforts to maintain
policies of directors' and officers' liability insurance
providing coverage of no less than $15,000,000 with respect to
matters existing or occurring at or prior to the date thereof and
(ii) will include the former PBGC representative on the Board of
Directors of Kaiser as beneficiaries under any directors' and
officers' liability insurance policy which is obtained by
Kaiser.
9. Nature and Survival of Representations. Subject to
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Paragraph 10, all representations, warranties and covenants made
by any party in this Agreement shall survive the closing
hereunder and the consummation of the Transaction, regardless of
any facts that come to the attention of the party.
10. Right of Indemnification. Each party (the
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"Indemnifying Party") shall indemnify and hold the other party
(the "Indemnified Party") harmless from and against all costs and
expenses (including reasonable attorneys' fees), damages and
losses ("Losses") arising out of or resulting from a breach of
any representation, warranty or covenant made by the Indemnifying
Party in this Agreement. Except with respect to claims for
actual fraud, which may be made without regard to any limitation,
(i) each party shall be required to indemnify the other only to
the extent that the aggregate amount of Losses for which it must
provide indemnity exceeds $10,000 and (ii) the aggregate
recoveries from either party may each not exceed an aggregate of
the Purchase Price as a result of all Losses under this Agreement
or with respect to the Transaction. If any claim is asserted or
any action or proceeding is brought in respect of which indemnity
may be sought, the Indemnified Party will promptly notify the
Indemnifying Party in writing of such asserted claim or the
institution of such action or proceeding; provided, however, that
the Indemnified Party's failure to so notify the Indemnifying
Party will not relieve the Indemnifying Party from any liability
it might otherwise have on account of this indemnity, except to
the extent that the Indemnifying Party has been materially
prejudiced by such failure to notify. The Indemnifying Party
may, at its option, undertake full responsibility for the defense
of any third-party claim which, if successful, would result in an
obligation of indemnity under this Agreement. The Indemnifying
Party may contest or settle any such claim on such terms as the
Indemnifying Party may choose, provided that the Indemnifying
Party will not have the right, without the Indemnified Party's
prior written consent, to settle any such claim if such
settlement (i) arises from or is part of any criminal action,
suit or proceeding, (ii) contains a stipulation to, confession of
judgement with respect to, or admission or acknowledgement of,
any liability or wrongdoing on the part of the Indemnified Party,
(iii) relates to any tax matters, (iv) provides for injunctive
relief, or other relief or finding other than money damages,
which is binding on the Indemnified Party, or (v) does not
contain an unconditional release of the Indemnified Party. Such
defense will be conducted by reputable attorneys retained by the
Indemnifying Party at the Indemnifying Party's cost and expense,
but the Indemnified Party will have the right to participate in
such proceedings and to be separately represented by attorneys of
its own choosing. The Indemnified Party will be responsible for
the costs of such separate representation. The Indemnifying
Party and the Indemnified Party shall cooperate in determining
the validity of any third-party claim for any Loss for which a
claim of indemnification may be made hereunder. Each party shall
also use all reasonable efforts to minimize all Losses.
11. Miscellaneous Provisions.
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(a) Specific Performance. The parties hereto agree
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that irreparable damage would occur in the event that any of the
provisions of this Agreement were not performed by the applicable
party hereto in accordance with the specific terms of this
Agreement or were otherwise breached. Each of the parties hereto
shall be entitled to an injunction or injunctions to prevent
breaches of this Agreement by the other and to enforce
specifically the terms and provisions hereof in addition to any
other remedy to which such party is entitled at law or in equity,
and each party waives the posting of any bond or security in
connection with any proceeding related thereto.
(b) Expenses. Except as may otherwise be provided
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herein, no party hereto shall be responsible for the payment of
any other party's expenses incurred in connection with this
Agreement.
(c) Third Party Beneficiaries. Except as expressly
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provided in this Agreement, the terms and provisions of this
Agreement are intended solely for the benefit of each party
hereto and its respective successors and assigns, and it is not
the intention of the parties to confer third party beneficiary
rights upon any other person or entity.
(d) Further Assurances. At any time, and from time to
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time, after the date thereof, each party will execute such
additional instruments and take such action as may be reasonably
requested by the other party to confirm or perfect title to PBGC
Shares or otherwise to carry out the intent and purposes of this
Agreement.
(e) Waiver. Any failure on the part of any party
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hereto to comply with any of its obligations, agreements or
conditions hereunder may be waived in writing by the party to
whom such compliance is owed.
(f) Notices. All notices and other communications
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hereunder shall be in writing and shall be deemed to have been
given if delivered in person or sent by prepaid first class
registered or certified mail, return receipt requested to the
respective principal offices of the parties hereto to the
respective principal offices of the parties hereto as specified
below:
If to Kaiser: Kaiser Ventures Inc.
0000 X. Xxxxxx Xxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxxxx 00000
Attention: President
With a copy to:
Xxxxx X. Xxxx, Esq.
Kaiser Ventures Inc.
0000 X. Xxxxxx Xxxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to PBGC: Pension Benefit Guaranty
Corporation
c/o Pacholder Associates, Inc.,
as Agent
0000 Xxxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxx, XX
Senior Vice President
and Associate General
Counsel
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
Xxxxxxx X. Xxxxxx, Esq.
Xxxx, Xxxxxxxxxx & Xxxxxxxxx
1800 Firstar Tower
000 Xxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Any notice or communication mailed shall also be faxed to
the appropriate number specified above.
(g) Interpretation. In this Agreement the singular
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included the plural and the plural the singular; words importing
any gender include the other genders; references to statutes are
to be construed as including all statutory provisions
consolidating, amending or replacing the statute referred to;
references to "writing," include printing, typing, lithography
and other means of reproducing words in a tangible visible form;
the word "including," "includes" and "include" are deemed to be
followed by the words "but not limited to"; and references to
paragraphs (or subdivisions of paragraphs) recitals or exhibits
are to those of this Agreement unless otherwise indicated. The
language used in this Agreement will be deemed to be the language
chosen by the parties to this Agreement to express their mutual
intent, and no rule of strict construction shall be applied
against any party.
(h) Counterparts. This Agreement may be executed
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simultaneously in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute
one and the same instrument.
(i) Governing Law. This Agreement shall be governed
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by, and interpreted in accordance with, the laws of the State of
Delaware, without regard to the conflict of law principles
thereof. All actions and proceedings arising out of or relating
to this Agreement shall be heard and determined in any state or
Federal court sitting in Delaware. Each of the parties hereto
(i) consents to submit such party to the personal jurisdiction of
any Federal court located in the State of Delaware or any
Delaware state court in the event any dispute arises out of this
Agreement or any of the transactions contemplated hereby; (ii)
agrees that such party will not attempt to deny or defeat such
personal jurisdiction by motion or other request for leave from
any such court; (iii) agrees that such party will not bring any
action relating to this Agreement or the transactions
contemplated hereby in any court other than a Federal court
sitting in the State of Delaware or a Delaware state court; and
(iv) waives any right to trial by jury with respect to any claim
or proceeding related to or arising out of this Agreement or any
of the transactions contemplated hereby.
(j) Binding Effect. This Agreement shall be binding
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upon the parties hereto and inure to the benefit of the parties,
their respective successors and assigns.
(k) Entire Agreement. This Agreement and the exhibits
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to be attached hereto constitute the entire agreement of the
parties covering everything agreed upon or understood in the
Transaction. The parties are executing and carrying out this
Agreement in reliance solely on the representations, warranties
and covenants and agreements contained in this Agreement and in
the written documents contemplated by this Agreement. This
Agreement may not be amended or modified except by a written
document executed by Kaiser and PBGC.
(l) Enforcement Costs. In the event of any legal
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proceeding to enforce any of the terms hereof, the prevailing
party shall be entitled to receive payment for its attorneys'
fees and all other costs required to enforce its rights
hereunder.
(m) Regulatory Filings. Each party shall be
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reasonable for completing and filing any regulatory filings that
may be applicable to it, including, but not limited to, any
filings with the Securities and Exchange Commission.
(n) Good Faith. The parties agree to seek in good
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faith to seek to consummate the Transaction.
(o) Public Announcements. Neither party shall make
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any public announcements concerning this Agreement or the
Transactions contemplated herein without prior written consent of
the other party except as required by law, regulation or court
order; provided however that in any case any party required to
make a public announcement shall notify the other, and shall
reasonably cooperate with that other party in making such
required disclosure.
(p) Severability. The validity, legality or
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enforceability of the remainder of this Agreement shall not be
affected even if one or more of the provisions of this Agreement
shall be held to be invalid, illegal or unenforceable in any
respect. To the extent permitted by applicable law, the parties
hereby waive any provision of law that would render any provision
hereof prohibited or unenforceable in any respect.
(q) Headings. The headings in this Agreement are
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inserted only as a matter of convenience, and in no way define,
limit, or extend or interpret the scope of this Agreement or of
any particular paragraph.
IN WITNESS WHEREOF, the parties have executed this Agreement
to be effective as of the day and year first above written.
"PBGC" "Kaiser"
Pension Benefit Guaranty Kaiser Ventures Inc.
Corporation
By: Pacholder Associates,
Inc., as Agent
By:________________________ By:__________________________
Xxxxxx X. Xxxxxxxx. II Xxxxxxx X. Xxxxxxxx
Senior Vice President and President, Chief Executive
Associate General Counsel Officer & Chairman of the
Board
