Exhibit 2.21
COOPERATION AGREEMENT
BY AND BETWEEN
PITTSTON COAL COMPANY
AND
MAXXIM REBUILD CO., LLC
December 13, 2002
Table of Contents
Page
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ARTICLE I DEFINITIONS............................................................................................2
1.1. Acquisition Agreement.................................................................................2
1.2. Affiliates, Successors, Assigns, Lessees or Contractors...............................................2
1.3. Agreement.............................................................................................3
1.4. Coal Act Liabilities..................................................................................3
1.5. Communications........................................................................................3
1.6. Employee Related Liabilities..........................................................................3
1.7. Maxxim LLC............................................................................................3
1.8. PCC...................................................................................................3
1.9. Recurrence Claim......................................................................................3
1.10. Third Parties.........................................................................................3
1.11. UMWA..................................................................................................4
1.12. Workers' Compensation and Federal Black Lung Liabilities..............................................4
ARTICLE II COAL ACT LIABILITIES..................................................................................4
2.1. General...............................................................................................4
ARTICLE III WORKERS' COMPENSATION AND FEDERAL BLACK LUNG LIABILITIES.............................................6
3.1. General...............................................................................................6
3.2. Litigation and Disputes...............................................................................7
3.3. No Adverse Changes....................................................................................8
3.4. Recurrence of Prior Claims............................................................................8
ARTICLE IV EMPLOYEE RELATED LIABILITIES..........................................................................9
4.1. Employee Related Liabilities..........................................................................9
ARTICLE V DISPUTE RESOLUTION....................................................................................10
ARTICLE VI TERM.................................................................................................11
ARTICLE VII MISCELLANEOUS.......................................................................................11
7.1. Cooperation..........................................................................................11
7.2. Continuing Obligations...............................................................................12
7.3. Maxxim LLC Communication with Third Parties..........................................................12
7.4. Litigation Support...................................................................................13
7.5. Confidentiality......................................................................................13
7.6. Governing Law........................................................................................14
7.7. Successors and Assigns...............................................................................15
7.8. Notices and Payments.................................................................................15
COOPERATION AGREEMENT
THIS COOPERATION AGREEMENT, made as of December 13, 2002, by and between
PITTSTON COAL COMPANY, a Delaware corporation ("PCC"), on its own behalf and on
behalf of its Affiliates, and MAXXIM REBUILD CO., LLC, a Delaware limited
liability company ("Maxxim LLC"), on its own behalf and on behalf of its
Affiliates.
RECITALS
WHEREAS, Maxxim LLC, PCC and certain Affiliates of PCC have entered into a
certain asset purchase agreement as set forth on Schedule A, dated as of October
29, 2002 (such agreement, together with the Exhibits and Schedules attached
thereto being hereinafter referred to as the "Acquisition Agreement"), pursuant
to which Maxxim LLC has agreed to purchase or acquire from PCC and certain of
its Affiliates certain assets, and assume certain liabilities, all upon the
terms and subject to the conditions set forth in the Acquisition Agreement;
WHEREAS, pursuant to the Acquisition Agreement, PCC has agreed to retain
certain liabilities and certain assets; and
WHEREAS, PCC, PCC Parent, Maxxim LLC and Alpha Natural Resources, LLC, a
Delaware limited liability company, have entered into the Indemnification and
Guaranty Agreement; and
WHEREAS, PCC and Maxxim LLC desire to establish certain administrative
procedures with respect to their respective obligations under the Acquisition
Agreement; provided, however, that nothing in this Agreement is intended in any
way to reallocate risk or modify the allocation of liabilities in the
Acquisition Agreement or the Indemnification and Guaranty Agreement; and
provided, further, that nothing in this Agreement, the Acquisition Agreement or
the Indemnity Agreement is intended to, nor should be construed to, establish a
single employer, joint employer, common employer and/or alter ego relationship
between PCC and its Affiliates on the one hand and Maxxim LLC and its Affiliates
on the other hand.
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NOW, THEREFORE, in consideration of the mutual covenants, conditions and
agreements set forth herein and in the Acquisition Agreement and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, PCC and Maxxim LLC agree that:
ARTICLE I
DEFINITIONS
When used in this Agreement, the following terms shall have the meanings
specified below. All capitalized terms used but not otherwise defined in this
Agreement shall have the meanings specified in the Acquisition Agreement.
1.1. Acquisition Agreement.
"Acquisition Agreement" shall have the meaning set forth in the Recitals to
this Agreement.
1.2. Affiliates, Successors, Assigns, Lessees or Contractors.
"Affiliates, Successors, Assigns, Lessees or Contractors" shall mean Maxxim
LLC's Affiliates, contractual successors and assigns, and lessees and
contractors who, as part of a contractual arrangement with Maxxim LLC or one of
its Affiliates, offer employment to the current or former Employees of an Asset
Sale Company.
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1.3. Agreement.
"Agreement" shall mean this Cooperation Agreement, together with the
Schedule[s] attached hereto, as the same may be amended from time to time in
accordance with the terms hereof.
1.4. Coal Act Liabilities.
"Coal Act Liabilities" shall mean those Retained Liabilities specified in
Section 1.71(i) of the Acquisition Agreement.
1.5. Communications.
"Communications" shall have the meaning set forth in Section 2.1(a) hereof.
1.6. Employee Related Liabilities.
"Employee Related Liabilities" shall mean those Retained Liabilities
specified in Sections 1.71(d), 1.71(e), 1.71(f), 1.71(h), 1.71(j), 1.71(k), and
1.71(m) of the Acquisition Agreement.
1.7. Maxxim LLC.
"Maxxim LLC" shall have the meaning set forth in the preamble to this
Agreement.
1.8. PCC.
"PCC" shall have the meaning set forth in the preamble to this Agreement.
1.9. Recurrence Claim.
"Recurrence Claim" shall have the meaning set forth in Section 3.4 hereof.
1.10. Third Parties.
"Third Parties" shall have the meaning set forth in Section 7.3 hereof.
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1.11. UMWA.
"UMWA" shall mean the International Union, United Mine Workers of America,
including its district and local unions.
1.12. Workers' Compensation and Federal Black Lung Liabilities.
"Workers' Compensation and Federal Black Lung Liabilities" shall mean those
Retained Liabilities specified in Sections 1.71(b) and 1.71(c) of the
Acquisition Agreement. ARTICLE II........ COAL ACT LIABILITIES
2.1. General.
In order to assist PCC with regard to the satisfaction of the Coal Act
Liabilities, PCC and Maxxim LLC agree as follows:
(a) Notices and Communication.
In the event Maxxim LLC or any of its Affiliates, Successors, Assigns,
Lessees or Contractors receive from any administrative, judicial or other source
any claims, communications, correspondence, notices, invoices and/or other
documents (collectively, "Communications") that are related to the Coal Act
Liabilities, Maxxim LLC agrees that it shall, and shall cause its Affiliates,
Successors, Assigns, Lessees or Contractors to:
(i) promptly send to PCC or its designated Affiliate a copy of any
such Communications; and
(ii) cooperate with PCC in notifying the sender of the Communications
that such Communications should be sent to PCC or its designated
Affiliate.
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(b) Litigation.
PCC shall have the exclusive right to pursue and/or defend currently
pending litigation or to commence and/or defend future litigation, with respect
to any issue relating to the Coal Act Liabilities, including, but not limited
to, claims pertaining to specific beneficiaries, statutory construction or the
constitutionality of the Coal Act, as PCC deems necessary or appropriate.
(c) Administration. PCC or one or more of its Affiliates shall be solely
responsible for administering the Coal Act Liabilities and shall take
such actions as it deems necessary or appropriate to administer the
Coal Act Liabilities, including, but not limited to:
(i) pursuing administrative or judicial challenges to the assignment
of beneficiaries to PCC or any of its Affiliates in accordance
with the terms of the Coal Act;
(ii) administering claims under the individual employer plan required
to be maintained under Section 9711 of the Coal Act, including
entering into agreements with third party administrators and
resolving or litigating claim disputes;
(iii) implementing managed care and/or other methods of delivery; and
(iv) discussing managed care and cost containment options with the
UMWA.
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ARTICLE III
WORKERS' COMPENSATION AND FEDERAL BLACK LUNG LIABILITIES
3.1. General.
In order to assist PCC with regard to the satisfaction of the Workers'
Compensation and Federal Black Lung Liabilities, PCC and Maxxim LLC agree as
follows:
(a) Administration.
PCC or one or more of its Affiliates shall be solely responsible for
administering the Workers' Compensation and Black Lung Liabilities, including
making such determinations, awarding and denying such benefits, seeking such
administrative and judicial rulings and remedies and taking all such other
actions as PCC shall deem necessary or appropriate.
(b) Notices and Communication.
(i) Maxxim LLC and PCC agree to cooperate with each other in
providing any notices that may be necessary to the appropriate
Governmental Authority regarding the allocation between PCC, on
the one hand, and Maxxim LLC, on the other hand, of the Workers'
Compensation and Federal Black Lung Liabilities.
(ii) In the event Maxxim LLC or any of its Affiliates, Successors,
Assigns, Lessees or Contractors receive any Communications that
are related to the Workers' Compensation and Federal Black Lung
Liabilities, Maxxim LLC agrees that it shall, and shall cause its
Affiliates, Successors, Assigns, Lessees or Contractors to, send
promptly to PCC or its designated Affiliate a copy of any such
Communications.
(iii) Maxxim LLC and PCC agree to cooperate with each other in
providing such notices of the allocation of liabilities under the
Acquisition Agreement as Maxxim LLC and PCC deems appropriate to
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any insurer or third party administrator providing services or
benefits related to the Workers' Compensation and Federal Black
Lung Liabilities.
3.2. Litigation and Disputes.
PCC shall have the right to resolve or defend against any claim that is
related to the Workers' Compensation and Federal Black Lung Liabilities in such
manner as PCC in its discretion deems appropriate, in accordance with such
procedures as PCC deems appropriate and with the controlling Workers'
Compensation Act and federal black lung Laws, including raising the defense that
Maxxim LLC is the responsible operator under the federal black lung Laws because
Maxxim LLC or its Affiliates, Successors, Assigns, Lessees or Contractors is a
successor-in-interest to PCC or its Affiliates; provided, however, that Maxxim
LLC shall have the right to respond that PCC is the responsible operator under
the federal black lung Laws notwithstanding Maxxim LLC's acquisition of the
Purchased Assets. PCC also shall have the right to institute or defend against
any litigation related to the Workers' Compensation and Federal Black Lung
Liabilities, except that PCC shall promptly notify Maxxim LLC of any workers'
compensation or federal black lung claim in which it intends to assert that
Maxxim LLC is responsible for payment of the same under the Acquisition
Agreement, in which case Maxxim LLC shall have the right to intervene in any
such action to oppose PCC's position. Any dispute as to which entity is the
responsible entity for such workers' compensation claims shall be determined in
accordance with the Workers' Compensation Acts, and any dispute as to which
entity is the responsible operator for such black lung claims shall be
determined in accordance with the federal black lung Laws.
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3.3. No Adverse Changes.
Maxxim LLC agrees that it will, and will cause its Affiliates, Successors,
Assigns, Lessees or Contractors to, use its or their commercially reasonable
efforts to retain in effect any lawful program or practice of PCC or its
Affiliates in effect at Closing that is intended to reduce employer liability or
the length of time an employee is entitled to receive benefits under the
Workers' Compensation Act. 3.4. Recurrence of Prior Claims.
In the event Maxxim LLC or any of its Affiliates, Successors, Assigns,
Lessees or Contractors receives a claim under the applicable Workers'
Compensation Acts or federal black lung Laws and Maxxim LLC or its Affiliates,
Successors, Assigns, Lessees or Contractors believes in good faith that such
claim relates to, or is a recurrence of, a prior claim that constituted a
Workers' Compensation or Federal Black Lung Liability (a "Recurrence Claim"),
the provisions of this Section 3.4 shall govern. Maxxim LLC shall promptly
notify PCC of any Recurrence Claim and the basis for its determination that such
claim is a Recurrence Claim prior to communicating its determination to any
other person or entity. If PCC agrees with Maxxim LLC that such claim is a
Recurrence Claim, such claim shall be deemed a Workers' Compensation and Federal
Black Lung Liability, and the rights and obligations of the parties shall be as
provided in this Article III. If PCC disagrees with Maxxim LLC's position, the
matter will be submitted to the appropriate Governmental Authority for a
determination, with each side being responsible for its respective costs in such
procedure. Maxxim LLC recognizes that in the event the employee who has filed
the claim disagrees with the position of the parties with respect to a
Recurrence Claim, the employee may file a claim with the appropriate
Governmental Authority for a determination. In any such case, PCC and Maxxim LLC
shall each have the right to defend its position, with each side bearing the
cost of its own defense.
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ARTICLE IV
EMPLOYEE RELATED LIABILITIES
4.1. Employee Related Liabilities.
In order to assist PCC with regard to the satisfaction of the Employee
Related Liabilities, PCC and Maxxim LLC agree as follows:
(a) Administration. PCC or one or more of its Affiliates shall be solely
responsible for administering the Employee Related Liabilities, making
such determinations, awarding and denying such benefits, seeking such
administrative and judicial rulings and remedies and taking all such
other actions as PCC shall deem necessary or appropriate.
(b) Notices and Communication.
(i) PCC has the exclusive right to provide such notices as PCC deems
necessary or appropriate to Employees or other beneficiaries
regarding any matters related to the Employee Related Liabilities
and to any third parties providing services or benefits related
to the Employee Related Liabilities.
(ii) In the event Maxxim LLC or any of its Affiliates, Successors,
Assigns, Lessees or Contractors receives any Communications that
are related to the Employee Related Liabilities, Maxxim LLC shall
promptly send, and shall cause its Affiliates, Successors,
Assigns, Lessees or Contractors promptly to send, such
Communications to PCC or its designated Affiliate.
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(iii) Maxxim LLC agrees to provide on a monthly basis for a period of
12 months following the Closing Date, the names and social
security numbers of any non-Classified Employees hired by Maxxim
LLC or its Affiliates, Successors, Assigns, Lessees or
Contractors and further agrees to provide, and shall cause its
Affiliates, Successors, Assigns, Lessees or Contractors to
provide, all information in its or their possession or under its
or their control reasonably requested by PCC in order to
administer and satisfy any Employee Related Liabilities.
(c) Litigation. PCC shall have the exclusive right to pursue and/or defend
currently pending litigation, or to commence and/or defend future
litigation, with respect to any issue related to any Employee Related
Liabilities, as PCC shall deem necessary or appropriate.
ARTICLE V
DISPUTE RESOLUTION
Disputes under or alleged violations of this Agreement shall be handled in
accordance with the Dispute resolution procedure set forth in Article VII of the
Indemnification and Guaranty Agreement.
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ARTICLE VI
TERM
The term of this Agreement shall commence as of the Closing Date and shall
continue through the completed satisfaction of all of the Coal Act Liabilities,
Workers' Compensation and Federal Black Lung Liabilities and the Employee
Related Liabilities.
ARTICLE VII
MISCELLANEOUS
7.1. Cooperation.
(a) To the extent permitted by Law and on a timely basis, Maxxim LLC
agrees to take any reasonable action, provide information and execute
any appropriate documents, and shall cause its Affiliates, Successors,
Assigns, Lessees or Contractors to take any reasonable action, provide
information and execute any appropriate documents, that PCC reasonably
requests in order to assist PCC with regard to the administration and
satisfaction of the Coal Act Liabilities, Workers' Compensation and
Federal Black Lung Liabilities and the Employee Related Liabilities.
Upon written request by Maxxim LLC, PCC shall reimburse Maxxim LLC for
costs above $10,000 per year that are reasonably incurred by Maxxim
LLC or its Affiliates as a result of actions taken by it or them under
this Agreement. Prior to payment of such costs, PCC shall be entitled
to receive a detailed invoice of such costs from Maxxim LLC if so
requested by PCC.
(b) PCC and Maxxim LLC shall cooperate with each other to determine the
timing and manner of transferring the Books and Records to Maxxim LLC
after the Closing, provided, however, that Maxxim LLC or its
Affiliates shall have immediate access to all such Books and Records
while still in the possession of PCC and provided, further, that PCC
or its Affiliates shall have reasonable access to, and shall be
allowed to copy at its sole expense, any Books and Records to which
PCC reasonably believes it needs access or for which PCC reasonably
believes it needs copies after the Closing.
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7.2. Continuing Obligations.
Any failure by PCC or by Maxxim LLC or its Affiliates, Successors, Assigns,
Lessees, or Contractors to comply with any of their obligations in this
Agreement shall not relieve PCC or Maxxim LLC of any of their Liabilities or
obligations under the Acquisition Agreement.
7.3. Maxxim LLC Communication with Third Parties.
Unless otherwise agreed to in writing by PCC or except as permitted
specifically by this Agreement and the Acquisition Agreement, neither Maxxim LLC
nor any of its Affiliates, Successors, Assigns, Lessees or Contractors will make
any public statements or communicate with the United Mine Workers of America
Combined Benefit Fund, the 1992 UMWA Benefit Plan, any beneficiary of any
Employee Benefit Plan, or any other Person or entity (collectively, "Third
Parties") with respect to or concerning the Coal Act Liabilities, Workers'
Compensation and Federal Black Lung Liabilities and the Employee Related
Liabilities. Notwithstanding the foregoing, in the event PCC fails to take such
actions as are necessary to comply with its obligations under the Acquisition
Agreement and this Agreement with respect to any of the Coal Act Liabilities,
Workers' Compensation and Federal Black Lung Liabilities or the Employee Related
Liabilities within a reasonable time after receiving notice from Maxxim LLC that
attempts have been or are being made to obtain information concerning or to
impose any of the Coal Act Liabilities, Workers' Compensation and Federal Black
Lung Liabilities or the Employee Related Liabilities on Maxxim LLC or any of its
Affiliates, Successors, Assigns, Lessees or Contractors, Maxxim LLC shall be
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permitted to communicate with the appropriate Third Party regarding PCC's
obligations with respect to such Coal Act Liabilities, Workers' Compensation and
Federal Black Lung Liabilities or the Employee Related Liabilities. In addition,
notwithstanding anything in the foregoing to the contrary, in the event any
Third Party contacts Maxxim LLC to inquire about PCC's or any of its Affiliates
obligations with respect to such Coal Act Liabilities, Workers' Compensation and
Federal Black Lung Liabilities or the Employee Related Liabilities under this
Agreement, Maxxim LLC is permitted to direct such Third Party to contact PCC for
additional information.
7.4. Litigation Support.
In the event and for as long as PCC is actively contesting or defending
against any action, suit, proceeding, hearing, investigation, charge, complaint,
claim or demand related to the Coal Act Liabilities, Workers' Compensation and
Federal Black Lung Liabilities and the Employee Related Liabilities, Maxxim LLC
will, to the extent reasonable, cooperate, and shall cause its Affiliates,
Successors, Assigns, Lessees or Contractors to cooperate, with PCC and its
counsel in the contest or defense, make available their personnel and provide
such testimony and access to their books, documents and records as shall be
reasonably necessary in connection with the contest or defense.
7.5. Confidentiality.
Except as otherwise provided in this Agreement, each party hereto covenants
and agrees to keep confidential the existence of this Agreement and the contents
of this Agreement at all times while any provision of this Agreement is in
force, unless and to the extent that a party shall be required to disclose the
same by generally accepted accounting principles, Law or judicial order or
decree or administrative regulation or order or in order to comply with its
obligations hereunder; provided, however, that any party that believes it may be
required to disclose this Agreement or any provisions hereof shall promptly
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notify the other hereto in writing and afford such other party the opportunity
to determine whether disclosure is in fact required or if the scope of the
required disclosure can be reduced and provided further, however, that
notwithstanding anything in this Section 7.5 or in Section 7.3 hereof to the
contrary, without notifying the other party, any party may disclose the
existence and contents of this Agreement:
(a) to any employees within the party's organization who need to know
of this Agreement in order for the party to comply with its
obligations hereunder, so long as such employees at the time of
disclosure are required to comply with this Section 7.5;
(b) Maxxim LLC's Affiliates, Successors, Assigns, Lessees,
Contractors and their employees, attorneys, accountants,
consultants and lenders who need to know of the Agreement, so
long as such entities and persons agree to comply with this
Section 7.5;
(c) to any third-party contractor whose services the party requires
in order for the party to comply with its obligations hereunder
so long as such contractor is contractually obligated to comply
with this Section 7.5;
(d) in the financial statements of the party as required by generally
accepted accounting principles; or
(e) to any attorneys, accountants, consultants or lenders of a party
for whom the party agrees to be responsible for the compliance
herewith.
7.6. Governing Law.
This Agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Virginia, but without reference to the choice of law
provision thereof.
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7.7. Successors and Assigns.
This Agreement and each party's respective rights hereunder may not be
assigned at any time except as expressly set forth herein without the prior
written consent of the other party, which consent shall not be unreasonably
withheld, except that PCC may assign its rights hereunder to any Affiliate of
PCC after the Closing Date without the consent of Maxxim LLC and Maxxim LLC may
assign its rights hereunder to any Affiliate of Maxxim LLC after the Closing
Date without the consent of PCC. 7.8. Notices and Payments.
All Communications, notices and disclosures required or permitted by this
Agreement shall be in writing and shall be deemed to have been given when
delivered personally or by messenger or by overnight delivery service, or within
five (5) days of being mailed by registered or certified United States mail,
postage prepaid, return receipt requested, in all cases addressed to the person
for whom it is intended at his address set forth below or to such other address
as a party shall have designated by notice in writing to the other party in the
manner provided by this Section 7.8:
If to PCC: Pittston Coal Company
448 N.E. Main Street
P.O. Box 5100
Lebanon, Virginia 24266
Attention: President
With a copy to: Pittston Coal Company
c/o The Pittston Company
1801 Bayberry Court
P.O. Box 18100
Richmond, Virginia 23226-8100
Attention: General Counsel
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And a copy to: Hunton & Williams
Riverfront Plaza, East Tower
951 East Byrd Street
Richmond, Virginia 23219
Attention: Louanna O. Heuhsen, Esq.
If to Maxxim LLC: Maxxim Rebuild Co., LLC
c/o Alpha Natural Resources, LLC
406 West Main Street
Abingdon, Virginia 24212
Attention: Vice President
With a copy to: First Reserve Corporation
411 West Putnam, Suite 109
Greenwich, Connecticut 06830
Attention: Alex T. Krueger
First Reserve Corporation
1801 California Street, Suite 4110
Denver, Colorado 80202
Attention: Thomas R. Denison
Bartlit Beck Herman Palenchar & Scott
1899 Wynkoop Street, Suite 800
Denver, Colorado 80202
Attention: James L. Palenchar, Esq.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
date first written above.
MAXXIM REBUILD CO., LLC
By: /s/ Eddie Neely
-----------------------------------------
Name: Eddie Neely
Title: Vice President
PITTSTON COAL COMPANY
By: /s/ Michael D. Brown
-----------------------------------------
Name: Michael D. Brown
Title: Vice President - Development and
Technical Resources
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