SUBSEQUENT EVENT - PROPOSED MERGER

6 Months Ended

Jun. 30, 2012

SUBSEQUENT EVENT - PROPOSED MERGER

SUBSEQUENT EVENT - PROPOSED MERGER

18. SUBSEQUENT EVENT—PROPOSED MERGER

        On July 18, 2012, Georgia Gulf Corporation ("Georgia Gulf" or the "Company"), PPG Industries, Inc. ("PPG"), Eagle Spinco Inc., a wholly-owned subsidiary of PPG ("Spinco"), and Grizzly Acquisition Sub, Inc., a wholly-owned subsidiary of the Company ("Merger Sub"), entered into an Agreement and Plan of Merger (the "Merger Agreement") pursuant to which the Company will acquire PPG's chlor-alkali and derivatives business (the "Business") in a Reverse Morris Trust transaction (the "Merger"). Prior to the Merger and pursuant to a Separation Agreement (the "Separation Agreement"), dated as of July 18, 2012, between PPG and Spinco, PPG will, among other things, transfer the Business to Spinco and, thereafter, PPG will distribute to PPG stockholders all of the issued and outstanding shares of Spinco (the "Distribution"). Immediately following the Distribution, Spinco will be merged with the Company or one of the Company's subsidiaries.

        Upon consummation of the transactions contemplated by the Merger Agreement and the Separation Agreement, the shares of Spinco common stock then-outstanding are expected to be automatically converted into the greater of 35.2 million shares of the Company's common stock (the "Company Common Stock") and 50.5 percent of the Company Common Stock. The Company's existing stockholders will continue to hold the remaining approximately 49.5 percent of the Company's Common Stock.

        The transaction value of approximately $2.1 billion consists of $900 million of cash to be paid to PPG, approximately $95 million of assumed debt, about $87 million of minority interest, and Georgia Gulf shares to be received by PPG shareholders valued at $1.0 billion based on Georgia Gulf's closing stock price on July 18, 2012 (the date of execution of the Merger Agreement).

        The Company has obtained commitments for the initial financing of the transaction in the form of bridge and term loans from Barclays Capital and JP Morgan. The company expects to replace the bridge loan at or shortly after the closing of the transaction with $660 million of unsecured notes that would mature eight years after the date of issuance, and be subject to a five year no-call period.

        The consummation of the Merger is subject to various customary closing conditions, including (i) approval by the Company's stockholders, (ii) expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvement Act of 1976, as amended, (iii) completion of the Distribution, (iv) confirmation by applicable tax authorities of the intended tax treatment of the transaction, (v) obtaining other regulatory approvals necessary to complete the Merger, and (vi) the absence of any law or order from any court or governmental authority restraining, enjoining or prohibiting the transaction.

        Completion of the transaction is anticipated to occur in late 2012 or early 2013, although there can be no assurance the transaction will occur within the expected timeframe or at all.