Koppers 8K Fourth Amendment to Stockholders’ Agreement | KOP 7 Feb 06

Exhibit 99.2

CONSENT AND FIRST AMENDMENT TO CREDIT AGREEMENT

THIS CONSENT AND FIRST AMENDMENT TO CREDIT AGREEMENT (the “Consent and Amendment”), dated as of December 2, 2005, amends that certain Amended and Restated Credit Agreement dated as of August 15, 2005 (the “Credit Agreement”), by and amongKOPPERS INC., a Pennsylvania corporation (the “Borrower”),EACH OF THE GUARANTORS (as defined in the Credit Agreement), theBANKS (as defined in the Credit Agreement),PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent (the “Administrative Agent”),NATIONAL CITY BANK OF PENNSYLVANIA, as Syndication Agent, andCITIZENS BANK OF PENNSYLVANIA, BANK OF AMERICA, N.A.andFIRST COMMONWEALTH BANK, as Co-Documentation Agents.

WITNESSETH:

WHEREAS, Borrower has requested, and the Banks have agreed, subject to the terms and conditions herein, to amend the Credit Agreement to, among other matters, permit KI Holdings to do an initial public offering of its shares.

NOW, THEREFORE, the parties hereto, in consideration of their mutual covenants and agreements herein contained and intending to be legally bound hereby, covenant and agree as follows:

I.Definitions.

Capitalized terms not otherwise defined herein have the meanings given to them in the Credit Agreement.

II.Amendments to Credit Agreement.

A. Section 3.3 [Term Loan Notes] of the Credit Agreement is hereby amended and restated as follows:

“3.3Term Loan Notes.

The Obligation of the Borrower to repay the unpaid principal amount of the Term Loans made to it by each Bank, together with interest thereon, shall be evidenced by a Term Note dated on or about December 19, 2005 in substantially the form attached hereto asExhibit 1.1(T) payable to the order of each Bank in a face amount equal to the Term Loan of such Bank. The principal amount as provided therein of the Term Notes shall be payable in 15 quarterly installments on the first day of each February, May, August, and November after the date of such Term Notes, each in the amount of $1,000,000, commencing on May 1, 2006 through August 1, 2009, with a final payment of all outstanding principal and interest on the Term Loans due on the Term Loan Maturity Date.”

B. Section 8.2.8 [Affiliate Transactions] of the Credit Agreement is hereby amended and restated as follows:

“8.2.8Affiliate Transactions.

Each of the Loan Parties shall not, and shall not permit any of its Subsidiaries to, enter into or carry out any transaction with an Affiliate (other than a Loan Party or a wholly-owned Subsidiary of a Loan Party to the extent not otherwise prohibited by this Agreement) (including purchasing property or services from or selling property or services to any Affiliate of any Loan Party or other Person) unless such transaction is not otherwise prohibited by this Agreement, is entered into in the ordinary course of business upon fair and reasonable arm’s-length terms and conditions which are of a type which are or have previously been fully disclosed to the Administrative Agent and is in accordance with all applicable Law; it being agreed that prior to the payment of the fee described in the next succeeding sentence, the performance of the Advisory Services Agreement, dated as of December 1, 1997 (the “Advisory Services Agreement”), between the Borrower and Saratoga is permitted hereunder, and the payment by the Borrower of the fees in the amounts set forth in Sections 3(b) and (c), 4 and 5 of the Advisory Services Agreement is permitted hereunder. Effective upon the initial public offering of KI Holdings, the Borrower is permitted to terminate the Advisory Services Agreement, and in connection therewith, the Borrower is permitted to pay a financial advisor services termination fee in an amount not to exceed $3,000,000 (the “Financial Advisor Services Termination Fee”). Upon payment by the Borrower of such Financial Advisor Services Termination Fee, the Advisory Services Agreement is terminated and no further payments shall be permitted to be made in connection with the Advisory Services Agreement.”

C. Section 9.1.13 [Change of Control] of the Credit Agreement is hereby amended and restated as follows:

“9.1.13Change of Control.

(i) any Person other than the Investors and their controlled (but not controlling or commonly controlled) Affiliates shall become the beneficial owner of more than 50% of the voting stock of the Borrower or shall obtain the power to nominate or elect, by agreement or otherwise, at least a majority of the board of directors of the Borrower, (ii) a “Change of Control” as defined in the 2003 Senior Note Indenture shall occur, or (iii) the Borrower shall cease to own 100% of the capital stock, member interests or partnership interests of any Loan Party except as permitted in this Agreement or following the consent of the Required Banks;”

III.Increase of Term Loan Commitments.

The Borrower, the other Loan Parties, and the Banks hereby agree to increase the Term Loan Commitments from the current outstanding amount of $9,500,000 to $19,000,000 andSchedule 1.1(B) [Commitments of Banks and Addresses for Notices] to the Credit Agreement is hereby amended and restated to read as set forth on theSchedule 1.1(B) attached to this Consent and Amendment, so that after giving effect to such increase, each Bank has the Commitments as set forth opposite such Bank’s name on the amended and restatedSchedule 1.1(B) attached to this Consent and Amendment. The additional $10,000,000 of new funding, with respect to the Term Loan, provided under this Consent and Amendment shall be funded on or about December 19, 2005 upon consummation of all the conditions precedent set forth in Section 5 hereof.

IV.Consent.

The Banks hereby agree as follows:

(i) pursuant to Section 8.2.14.2 [Changes in 2003 Senior Note Debt Documents; Prohibition on Repurchase or Prepayment], the Banks hereby consent to a change in the definition of “Change of Control” in the 2003 Senior Note Indenture to provide that a public offering of the common stock of KI Holdings will be deemed a public offering of the common stock of the Borrower and therefore not constitute a “Change of Control” under the 2003 Senior Note Indenture; and

(ii) pursuant to Section 8.1.6 [Visitation Rights; Collateral Examinations], the Banks hereby consent to defer completion of the 2005 annual collateral audit and field examination until on or before March 31, 2006.

V.Conditions Precedent.

The Borrower, the Guarantors and the Banks acknowledge and agree that the Amendments set forth in Section 2 above, the increase in the Term Loan Commitments set forth in Section 3 above, and the Lenders’ consents set forth in Section 4 above shall be effective upon the occurrence of all the following conditions precedent (a) through (g):

A. The Borrower, the Guarantors, and the Banks shall have executed this Consent and Amendment;

B. There shall be delivered to the Administrative Agent for the benefit of each Bank a certificate, dated as of the date of this Consent and Amendment and signed by the Secretary or an Assistant Secretary of the each Loan Party, certifying as appropriate as to:

1. all action taken by such party in connection with this Consent and Amendment and the other Loan Documents together with resolutions of each Loan Party evidencing same;

2. the names of the officer or officers authorized to sign this Consent and Amendment, the Term Notes, and any other documents executed and delivered in connection herewith and the true signatures of such officer or officers and specifying the Authorized Officers permitted to act on behalf of the Loan Parties for purposes of the Loan Documents and the true signatures of such officers, on which the Agent and each Lender may conclusively rely; and

3. copies of its organizational documents, including its certificate of incorporation, bylaws, certificate of limited partnership, partnership agreement, certificate of formation and limited liability company agreement, in each case as in effect on the date of this Consent and Amendment, certified by the appropriate state official where such documents are filed in a state office together with certificates from the appropriate state officials as to the continued existence and good standing of such Loan Party in each state where organized or qualified to do business, provided, however, that the Loan Parties may, in lieu of delivering copies of the foregoing organizational documents and good standing certificates, certify that the organizational documents and good standing certificates previously delivered by the Loan Parties to the Administrative Agent remain in full force and effect and have not been modified, amended, or rescinded;

C. The Borrower shall have delivered to the Administrative Agent an opinion or opinions of Borrower’s counsel which shall opine as to (i) the due authorization, execution and delivery, and enforceability of this Consent and Amendment and the Term Notes and (ii) such other matters as reasonably requested by the Administrative Agent, which opinion shall be in form and substance reasonably satisfactory to the Administrative Agent;

D. Each of the Loan Parties represents and warrants to the Administrative Agent and the Banks that, by its execution and delivery hereof to the Administrative Agent, after giving effect to this Consent and Amendment, no Material Adverse Change shall have occurred since the Closing Date of the Credit Agreement;

E. The representations and warranties set forth in the Credit Agreement and this Consent and Amendment shall be true and correct on and as of the date of this Consent and Amendment with the same effect as though such representations and warranties had been made on and as of such date (except representations and warranties that relate solely to an earlier date or time, which representations and warranties

shall be true and correct on and as of the specific dates or times referred to therein), and no Potential Default or Event of Default shall exist and be continuing under the Credit Agreement or under any other material agreement, as of the date of this Consent and Amendment and the Borrower shall have delivered to the Administrative Agent a closing certificate certifying to all of the foregoing;

F. The Borrower and the Guarantors shall have obtained all approvals and consents necessary to consummate the transactions contemplated by this Consent and Amendment; and

G. All legal details and proceedings in connection with the transactions contemplated by this Consent and Amendment and all other Loan Documents to be delivered to the Banks shall be in form and substance reasonably satisfactory to the Administrative Agent.

The Borrower, the Guarantors and the Banks acknowledge and agree that upon the occurrence of all the following additional conditions precedent and provided no Event of Default or Potential Default exists, the Banks shall fund the additional amount of the Term Loan Commitments to the Borrower on or about December 19, 2005, but the Banks shall have no obligation to fund such additional amounts after February 28, 2006:

(w) The Borrower shall have delivered to the Administrative Agent and the Banks a final draft of all documents associated with the planned initial public offering of KI Holdings (the “KI Holdings IPO”) and shall have delivered to the Administrative Agent such information with respect to such initial public offering as the Administrative Agent shall have reasonably requested;

(x) The KI Holdings IPO shall have been consummated in an amount of at least $120,000,000 of which at least $100,000,000 will be used to repurchase/tender the 2003 Senior Notes;

(y) The Borrower shall have executed and delivered to each of the Banks new Term Notes in substantially the form attached hereto asExhibit 1.1(T), reflecting the amount of each such Bank’s Term Loan Commitment as so increased pursuant to this Consent and Amendment; and

(z) The Borrower shall have paid to the Administrative Agent, for the benefit of the Banks, the following fees, which shall be deemed to be earned as of the date of the funding of the additional amount of the Term Loan Commitments: (i) 7.5 basis points (0.075%) of the sum of such Bank’s Revolving Credit Commitment plus its outstanding Term Loan balance as it existed immediately prior to the date of this Consent and Amendment; and (ii) 25 basis points (0.25%) on the additional funds advanced under the Term Loan by the Banks pursuant to this Consent and Amendment.

VI.Incorporation into Credit Agreement.

This Consent and Amendment shall be incorporated into the Credit Agreement by this reference.

VII.Full Force and Effect.

Except as expressly modified by this Consent and Amendment, all of the terms, conditions, representations, warranties, and covenants of the Credit Agreement and the other Loan Documents are true and correct and shall continue in full force and effect without modification, including without limitation, all liens and security interests securing the Borrower’s indebtedness to the Banks and all Guaranty Agreements executed and delivered by the Guarantors.

VIII.Reimbursement of Expenses.

The Borrower unconditionally agrees to pay and reimburse the Administrative Agent and save the Administrative Agent harmless against liability for the payment of reasonable out-of-pocket costs, expenses and disbursements, including without limitation, fees and expenses of counsel incurred by the Administrative Agent in connection with the development, preparation, execution, administration, interpretation or performance of this Consent and Amendment and all other documents or instruments to be delivered in connection herewith.

IX.Counterparts.

This Consent and Amendment may be executed by different parties hereto in any number of separate counterparts, each of which, when so executed and delivered shall be an original and all such counterparts shall together constitute one and the same instrument.

X.Entire Agreement.

This Consent and Amendment sets forth the entire agreement and understanding of the parties with respect to the transactions contemplated hereby and supersedes all prior understandings and agreements, whether written or oral, between the parties hereto relating to the subject matter hereof. No representation, promise, inducement or statement of intention has been made by any party which is not embodied in this Consent and Amendment, and no party shall be bound by or liable for any alleged representation, promise, inducement or statement of intention not set forth herein.

XI.Governing Law.

This Consent and Amendment shall be deemed to be a contract under the laws of the Commonwealth of Pennsylvania and for all purposes shall be governed by and construed and enforced in accordance with the internal laws of the Commonwealth of Pennsylvania without regard to its conflict of laws principles.

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