EXECUTION COPY
AGREEMENT, dated April 13, 2005, between Xxxx-XxXxx
Corporation, a Delaware corporation (the "COMPANY"), the
parties listed on the signature pages of this agreement as
Icahn Parties (each, an "ICAHN PARTY" and, collectively, the
"ICAHN PARTIES"), and the parties listed on the signature
pages of this agreement as Xxxx Parties (each, a "XXXX PARTY"
and, collectively, the "XXXX PARTIES").
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The Icahn Parties and the XXXX Parties have filed preliminary
proxy materials for use in connection with the Company's 2005 Annual Meeting of
Stockholders (collectively, the "PROXY MATERIALS") with the Securities and
Exchange Commission (the "SEC"), and each of the Icahn Parties and the XXXX
Parties has agreed to immediately suspend their solicitation of proxies in
connection with such Annual Meeting and, upon the Company's acceptance of shares
for payment (the "TENDER ACCEPTANCE") in the Tender Offer (defined below), to
terminate such solicitation and to withdraw their slate of nominees to the
Company's board of directors. For the purpose of this Agreement, the filing of
amendments to a proxy statement and the filing of other proxy materials with the
SEC intended to be responsive to comments from the SEC do not constitute the
solicitation of proxies, all in a manner not inconsistent with the terms of this
Agreement.
The Company plans to announce a self tender offer to acquire
between $3.96 billion and $4.0 billion in purchase price of its common stock in
a modified "Dutch" auction with a price range of $85 to $92 per share, subject
to receipt of satisfactory financing pursuant to an existing bank commitment and
other customary conditions for issuer self tender offers (the "TENDER OFFER").
In consideration of the mutual promises, covenants and
agreements contained herein, the parties agree as follows:
1. Each of the Icahn Parties and the XXXX Parties, as
applicable, hereby suspend their solicitation of proxies in connection with the
Company's 2005 Annual Meeting of Stockholders until the earlier of (1) May 25,
2005, (2) April 29, 2005 if the Company has not commenced the Tender Offer by
such date and (3) the date, if any, on which the Tender Offer is terminated or
abandoned or the terms of which are amended in any material respect (other than
an amendment to increase the aggregate number of shares to be purchased in the
Tender Offer) (such earlier date, the "SOLICITATION DATE"), after which the
Icahn Parties and the XXXX Parties may at their election commence such
solicitation in accordance with terms of this Agreement. After the Tender
Acceptance, each of the Icahn Parties and the XXXX Parties agrees to withdraw
its notice of intent to nominate persons for election as directors of the
Company at the Company's 2005 Annual Meeting of Stockholders, dated March 2,
2005, pursuant to Article III, Section 10 of the Company's By-Laws, and shall
take all steps necessary to cease, and to cause all Affiliates (as defined in
Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the "EXCHANGE
ACT")) immediately to cease, all efforts to nominate or elect directors to the
board of directors of the Company. After the Tender Acceptance, each of the
Icahn Parties and the XXXX Parties further agrees to vote for, and to
cause all Affiliates to vote for, the Company's nominees for election at the
2005 Annual Meeting of Stockholders.
2. Each of the Icahn Parties and the XXXX Parties agrees that,
for a period from the date of this Agreement through and including May 10, 2008
(the "RESTRICTED PERIOD"), unless specifically invited in writing by the Company
and unless a majority of the Continuing Directors (as defined below) has given
its approval to such invitation, no such party will, nor will any such party
permit any of its Affiliates to, nor will any such party cause any other person
to, in any manner, directly or indirectly:
(a) make, or propose (publicly or otherwise), any tender or
exchange offer, merger or other transaction involving the Company or
any Company Affiliate or propose that the Company or any Company
Affiliate engage in or enter into any transaction or similar activity,
(b) make or propose (publicly or otherwise) any proxy
solicitation or solicitation of consents to vote any voting securities
of the Company;
(c) form, join or in any way participate in a "group" (as
defined under the Exchange Act) in connection with any of the actions
set forth in clause (a);
(d) otherwise act, alone or in concert with others (including,
without limitation, any holder of securities or other interests in the
Company or any of its subsidiaries), to seek representation on the
board of directors of the Company or any of its subsidiaries or to seek
to control or influence the management, board of directors or policies
of the Company or any of its subsidiaries or to take any of the actions
described in clause (a);
(e) initiate, propose or otherwise solicit stockholders for
the approval of any stockholder proposal (as described in Rule 14a-8
under the Exchange Act or otherwise) with respect to the Company; or
(f) encourage, assist or advise any third party or entity
(including, without limitation, any holder of securities or other
interests in the Company) with respect to any of the matters specified
in this Section 2, or enter into any arrangements to so do.
Each of the Icahn Parties and the XXXX Parties also agrees during the Restricted
Period not to request that the Company (or its directors, officers, employees or
agents), directly or indirectly, amend or waive any provision of this Section
(including this sentence), or permit any of its Affiliates to so request. For
purposes of this agreement: (1) "CONTINUING DIRECTORS" means, as of any date of
determination, any member of the board of directors of the Company who (A) was a
member of such board of directors on the date hereof or (B) was nominated for
election or elected to such board of directors with the approval of a majority
of the Continuing Directors who were members of such board of directors at the
time of such nomination or election; (2) "PERSON" shall be broadly interpreted
to include the media and any corporation, partnership, group, individual or
other entity; and (3) references to "THE
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COMPANY" include any successor to the Company and any subsidiaries of the
Company. Notwithstanding the foregoing, (x) in the event the Tender Acceptance
has not occurred on or before the Solicitation Date, the provisions of this
Section 2 shall be suspended with respect to the Icahn Parties and the XXXX
Parties until such time as the Tender Acceptance shall occur, and the provisions
of this Section 2 shall terminate if the Tender Acceptance has not occurred on
or before June 23, 2005, (y) the limitation set forth in Section 2(c) shall not
apply with respect to any Icahn Party and its Affiliates constituting a "group"
with any other Icahn Party or Icahn Party Affiliate and (z) the limitations set
forth in Section 2(c) shall not apply with respect to any XXXX Party and its
Affiliates constituting a "group," with any other XXXX Party or XXXX Party
Affiliate.
3. (a) The Company agrees to commence the Tender Offer on or
before April 29, 2005.
(b) The Company agrees that, while all other business may be
brought before such Annual Meeting, it will cause its 2005 Annual Meeting of
Stockholders to be adjourned on May 10, 2005 before the nominations or elections
of directors to a date no earlier than June 7, 2005 and no later than June 9,
2005 for the purpose of nominating and electing directors. Provided that the
Tender Acceptance has not occurred and, in the event the Icahn Parties and the
XXXX Parties notify the Company on or before June 5, 2005, of their desire to
further adjourn the meeting, the Company will cause the meeting to be further
adjourned until a date no earlier than June 21, 2005 and no later than June 23,
2005.
(c) The Icahn Parties and the XXXX Parties agree not to object
to an amendment to the Company's By-Laws expressly granting the Chairman the
authority to adjourn any meeting of stockholders. The Company agrees not to
object to the Icahn Parties' notice of nominations as invalid under the
Company's By-Laws or on the basis of claims asserted in the Action.
(d) Each of the Icahn Parties and the XXXX Parties agrees not
to comment or otherwise disclose publicly their plans and intentions as to
whether to tender shares into the Tender Offer (other than a disclosure that
such party intends to tender all shares then beneficially owned by such Party).
4. Immediately after this Agreement is executed, the Company
will inform the Court having jurisdiction over the Action of the fact of this
settlement, and thereafter will take all steps necessary to dismiss the Action,
with prejudice.
5. The Company agrees to issue a press release in the form
attached as Exhibit A. Each of the Icahn Parties and the XXXX Parties agree to
issue a press release in the form attached as Exhibit B promptly after the
issuance of the Company release. The press releases will be issued at or before
9:00 a.m. (EDT) on Thursday, April 14, 2005. Prior to May 25, 2005, and at all
times after the Tender Acceptance, the Company and each of the Icahn Parties and
the XXXX Parties further agree not to make any statements inconsistent with
their respective press releases.
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6. Each party to this Agreement acknowledges and agrees that
money damages would not be sufficient for any breach of this Agreement by such
party or any Affiliate of such party, and that the other party or parties to
this Agreement shall be entitled to equitable relief, including injunction and
specific performance as a remedy for such breach. Such remedies shall not be
deemed to be exclusive remedies for such a breach, but shall be in addition to
all other remedies available in law or equity.
7. (a) Effective upon the Tender Acceptance, each of the Icahn
Parties, on behalf of itself and each of its direct and indirect subsidiaries,
affiliates, predecessors, successors and assigns, and each of such party's
participants in the Proxy Contest (as defined below), and each of the past and
present principals, partners, officers and directors of any of them,
individually and collectively (each such Party an "ICAHN PERSON" and,
collectively, the "ICAHN PERSONS"), hereby releases, acquits, and forever
discharges the Company, and each of its direct and indirect subsidiaries,
parents, affiliates, predecessors, successors and assigns, and each of the
Company's participants in the Proxy Contest, and each of the past and present
principals, officers, directors, employees and attorneys of any of them, from
and with respect to any and all claims, counterclaims, actions, causes of
action, suits, debts, dues, sums of money, accounts, reckonings, covenants,
contracts, agreements, promises, damages, judgments, obligations, controversies,
costs, expenses, attorneys' fees, liens, security interests, demands,
assertions, cross claims, disputes, indebtedness, executions of any nature, and
liabilities whatsoever possible, whether at law or in equity, statutory or
otherwise, whether known or unknown, asserted or unasserted, of every kind and
nature whatsoever, that any Icahn Person ever had, now has, or hereafter can,
shall, or may have against any Company Party (as defined below) for, upon, or by
reason of any matter, cause of action, or thing, whatsoever from the beginning
of the world to the date of the Tender Acceptance, asserted in or arising out of
or in connection with the Proxy Contest, the Nominations or the Action (each as
defined below), but expressly excluding (among other claims) any claim for
breach of or to enforce this Agreement.
(b) Effective upon the Tender Acceptance, each of the XXXX
Parties, on behalf of itself and each of its direct and indirect subsidiaries,
affiliates, predecessors, successors and assigns, and each of such party's
participants in the Proxy Contest (as defined below), and each of the past and
present principals, partners, officers and directors of any of them,
individually and collectively (each such Party a "XXXX PERSON" and,
collectively, the "XXXX PERSONS"), hereby releases, acquits, and forever
discharges the Company, and each of its direct and indirect subsidiaries,
parents, affiliates, predecessors, successors and assigns, and each of the
Company's nominees and participants in the Proxy Contest, and each of the past
and present principals, officers, directors, employees and attorneys of any of
them, from and with respect to any and all claims, counterclaims, actions,
causes of action, suits, debts, dues, sums of money, accounts, reckonings,
covenants, contracts, agreements, promises, damages, judgments, obligations,
controversies, costs, expenses, attorneys' fees, liens, security interests,
demands, assertions, cross claims, disputes, indebtedness, executions of any
nature, and liabilities whatsoever possible, whether at law or in equity,
statutory or otherwise, whether known or unknown, asserted or unasserted, of
every kind and nature whatsoever, that any XXXX Person ever had, now has, or
hereafter can, shall, or may have against any Company Party for, upon, or by
reason of any matter, cause of action, or thing, whatsoever from the beginning
of the world to the date of the Tender Acceptance, asserted in or arising
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out of or in connection with the Proxy Contest, the Nominations or the Action,
but expressly excluding (among other claims) any claim for breach of or to
enforce this Agreement.
(c) Effective upon the Tender Acceptance, the Company, on
behalf of itself and each of its direct and indirect subsidiaries, affiliates,
predecessors, successors and assigns, and each of the Company's nominees and
participants in the Proxy Contest, and each of the past and present principals,
officers and directors of any of them, individually and collectively (each such
Party a "COMPANY PARTY" and, collectively, the "COMPANY PARTIES"), hereby
releases, acquits, and forever discharges each Icahn Party and each XXXX Party
and each of its direct and indirect subsidiaries, parents, partners, affiliates,
predecessors, successors and assigns, and each of such party's nominees and
participants in the Proxy Contest, and each of the past and present principals,
officers, directors, partners, employees and attorneys of any of them, from and
with respect to any and all claims, counterclaims, actions, causes of action,
suits, debts, dues, sums of money, accounts, reckonings, covenants, contracts,
agreements, promises, damages, judgments, obligations, controversies, costs,
expenses, attorneys' fees, liens, security interests, demands, assertions, cross
claims, disputes, indebtedness, executions of any nature, and liabilities
whatsoever possible, whether at law or in equity, statutory or otherwise,
whether known or unknown, asserted or unasserted, of every kind and nature
whatsoever, that any Company Party ever had, now has, or hereafter can, shall,
or may have against any Icahn Person or XXXX Person for, upon, or by reason of
any matter, cause of action, or thing, whatsoever from the beginning of the
world to the date of the Tender Acceptance, asserted in or arising out of or in
connection with the Proxy Contest, the Nominations or the Action (each as
defined below), but expressly excluding (among other claims) any claim for
breach of or to enforce this Agreement.
(d) "PROXY CONTEST" means the actions, omissions,
solicitations, filings, allegations, campaign, and events that were part of,
arose from, or were in connection with the solicitations of proxies by the
Stockholders and the participants named in the related proxy material and
statements around the Company's 2005 Annual Meeting of Stockholders.
(e) The "ACTION" means the action captioned in XXXX-XXXXX
CORPORATION VS. (1) XXXX X. ICAHN, (2) BARBERRY CORPORATION, (3) XXXXXX
INVESTMENTS, LLC, (4) HIGH RIVER LIMITED PARTNERSHIP, (5) ICAHN PARTNERS MASTER
FUND LP, (6) ICAHN OFFSHORE LP, (7) CCI OFFSHORE LLC, (8) ICAHN PARTNERS LP, (9)
ICAHN ONSHORE LP, (10) CCI ONSHORE LLC, (11) XXXX PARTNERS LLC, (12) XXXXX
XXXXXXXXXX, AND (13) XXXX XXXXX, Civil Action No. CV-05-276-F, in the United
States District Court for the Western District of Oklahoma.
(f) "NOMINATIONS" means the Icahn Parties' nominations of Xxxx
X. Icahn and Xxxxx Xxxxxxxxxx to become members of the Board of Directors of the
Company, the Company's response to these nominations, and all related acts taken
by the Stockholders or the Company in relation thereto.
8. Any representation, warranty, promise, covenant, agreement
or obligation of the Icahn Parties, on the one hand, and the XXXX Parties, on
the other hand, are several and not joint.
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9. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original but all of which together will
constitute one and the same agreement.
10. This Agreement is governed by the laws of the State of New
York without giving effect to its conflicts of laws principles or rules.
The parties have duly executed this agreement.
XXXX-XXXXX CORPORATION
By:
-------------------
Name:
Title:
ICAHN PARTIES:
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_____________________________________________________
XXXX X. ICAHN
BARBERRY CORPORATION
By: ________________________________________________
Name:
Title:
XXXXXX INVESTMENTS, LLC
By: ________________________________________________
Name:
Title:
HIGH RIVER LIMITED PARTNERSHIP
By: ________________________________________________
Name:
Title:
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ICAHN PARTNERS MASTER FUND LP
By: ________________________________________________
Name:
Title:
ICAHN OFFSHORE LP
By: ________________________________________________
Name:
Title:
CCI OFFSHORE LLC
By: ________________________________________________
Name:
Title:
ICAHN PARTNERS LP
By: ________________________________________________
Name:
Title:
ICAHN ONSHORE LP
By: ________________________________________________
Name:
Title:
CCI ONSHORE LLC
By: ________________________________________________
Name:
Title:
XXXX PARTIES:
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_____________________________________________________
XXXXX XXXXXXXXXX
_____________________________________________________
XXXX XXXXX
_____________________________________________________
XXXX PARTNERS LLC
By: ________________________________________________
Name:
Title:
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Exhibit A
Xxxx-XxXxx Reaches Settlement with
Icahn Group and XXXX Partners
Company Withdraws Litigation and Announces that Icahn and XXXX
Will Withdraw Board Nominees Pending Completion of
Announced Share Repurchase Program
Oklahoma City, April 14, 2005 - Xxxx-XxXxx Corp. (NYSE: KMG) announced
today that it has entered into a settlement with Mr. Xxxx Xxxxx, certain
affiliated funds and XXXX Partners LLC. As a result, the company will dismiss
its complaint with prejudice filed March 10, 2005, in the United States District
Court for the Western District of Oklahoma.
Xxxx-XxXxx also announced that based on the company's recent actions to
enhance stockholder value, including the previously announced separation of its
chemical business and recently announced $4 billion share repurchase program in
the form of a modified "Dutch Auction" tender offer, it has received written
notice from the Icahn Group and XXXX Partners confirming that they will
immediately cease proxy solicitation activities. The Icahn Group and XXXX
Partners will withdraw their alternate board nominees from consideration for
election to the board of directors of Xxxx-XxXxx on successful completion of
Xxxx-XxXxx'x repurchase program. Xxxx-XxXxx has every expectation that it will
complete the repurchase program by mid-May, 2005.
"This settlement enables the company to deliver on its commitment to
deliver stockholder value and to advance its strategy as a pure-play exploration
and production company," said Xxxx X. Xxxxxxx, Xxxx-XxXxx chairman and chief
executive officer. "Our conversations with Mr. Icahn and XXXX have been
productive."
Xxxx-XxXxx is an Oklahoma City-based energy and inorganic chemical
company with worldwide operations and assets of more than $14 billion. For more
information visit the company's website at XXX.XXXX-XXXXX.XXX.
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Exhibit B
ICAHN GROUP & XXXX PARTNERS COMMEND XXXX-XXXXX FOR AGREEING
TO TAKE STEPS TO ENHANCE SHAREHOLDER VALUE
New York, April 14, 2005 - Xxxx Xxxxx and Xxxxx Xxxxxxxxxx today announced that
they commend Xxxx-XxXxx'x management and its Board of Directors for engaging in
productive discussions with us and other shareholders, and agreeing to take
steps to enhance shareholder value. They stated that "we believe that the steps
that Xxxx-XxXxx has undertaken will prove beneficial to all its shareholders."
Messrs. Icahn and Xxxxxxxxxx indicated that they were suspending their proxy
contest for seats on the Board of Directors of the Xxxx-XxXxx pending the
commencement and successful completion of the tender offer for shares of its
common stock which Xxxx-XxXxx plans to commence shortly. When the tender offer
is successfully completed, the proxy contest will be terminated said Messrs.
Icahn and Xxxxxxxxxx.
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