Filed by Westlake Chemical Corporation pursuant to Rule 425 under the Securities Act of 1933 and
deemed filed pursuant to Rule 14a-12 under the Securities Exchange Act of 1934
Subject Company: Axiall Corporation
Filer’s Commission File Number: 001-32260
Subject Company’s Commission File Number: 001-09753
On April 25, 2016, Westlake Chemical Corporation (“Westlake”) posted the following investor presentation related to Westlake’s proposed acquisition of Axiall Corporation (“Axiall”) and Westlake’s nomination of candidates for election to the board of directors of Axiall on Westlake’s website:
 Rationale
for Proposed Combination with Axiall Corporation April 2016
Westlake Chemical |
 1 Forward-Looking Statements This communication contains forward-looking statements within the meaning of the federal securities laws. These forward-looking
statements include, but are not limited to, statements regarding Westlake
Chemical Corporation’s (“Westlake”) proposal to acquire Axiall Corporation (“Axiall”) (including financing of the proposed transaction and the benefits, results, effects and timing of a transaction), all statements regarding Westlake’s (and
Westlake’s and Axiall’s combined)
expected future financial position, results of operations, cash flows, dividends,
financing plans, business strategy, budgets, capital expenditures, competitive positions, growth opportunities, plans and objectives of management, estimated synergies from the proposed transaction and statements containing
the use of forward-looking words, such as “may,”
“will,” “could,” “would,” “should,” “project,” “believe,” “anticipate,” “expect,” “estimate,” “continue,” “potential,” “plan,”
“forecast,” “approximate,” “intend,”
“upside,” and the like, or the use of future tense. Statements contained herein concerning the business outlook or future economic performance, anticipated profitability, revenues, expenses, dividends or other financial items, and product or services
line growth of Westlake (and the
combined businesses of Westlake and Axiall), together with other statements that are
not historical facts, are forward-looking statements that are estimates
reflecting the best judgment of Westlake based upon currently available
information. Statements concerning current conditions may also be forward-looking if they imply a continuation of current conditions. Such forward-looking statements are inherently uncertain, and stockholders and other potential investors must recognize that actual results
may differ materially from Westlake’s expectations as a result of a
variety of factors, including, without limitation, those discussed below. Such forward-looking statements are based upon management’s current expectations and include known and unknown risks, uncertainties and other factors, many of which Westlake is
unable to predict or control, that may cause Westlake’s actual
results, performance or plans with respect to Axiall to differ materially
from any future results, performance or plans expressed or implied by
such forward-looking statements. These statements involve risks, uncertainties and other factors discussed below and detailed from time to time in Westlake’s filings with the Securities and Exchange Commission (the “SEC”).
Risks and uncertainties related to the proposed business combination transaction
include, but are not limited to: (i) the ultimate outcome of any possible transaction between Westlake and Axiall, including the possibility that Axiall will not accept a transaction with Westlake, (ii) the ultimate outcome and results of
integrating the operations of Westlake and Axiall
if a transaction is consummated, (iii) the ability to obtain regulatory approvals and
meet other closing conditions to any possible transaction, including any
necessary stockholder approvals, (iv) potential adverse reactions or changes to business relationships resulting from the announcement, pendency or completion of the proposed transaction, (v) competitive responses to the announcement or completion of the
proposed transaction, costs and difficulties related to the integration
of Axiall’s businesses and operations with Westlake’s
businesses and operations, (vi) the inability to obtain, or delays in
obtaining, cost savings and synergies from the proposed transaction, (vii) uncertainties as to whether the completion of the proposed transaction or any transaction will have the accretive effect on Westlake’s earnings or cash flows that it expects, (viii) unexpected costs,
liabilities, charges or expenses resulting from the proposed transaction,
(ix) litigation relating to the proposed transaction, (x) the inability to retain key personnel, and (xi) any changes in general economic and/or industry-specific conditions. In addition to the factors set forth above, other factors that may affect Westlake’s plans, results or stock price are set
forth in Westlake’s Annual Report on Form
10-K and in its reports on Forms 10-Q and 8-K.
Many of these factors are beyond Westlake’s control. Westlake cautions investors
that any forward-looking statements made by Westlake are not guarantees of future performance. We do not intend, and undertake no obligation, to publish revised forward-looking statements to reflect events or
circumstances after the date of this communication or to reflect the
occurrence of unanticipated events. |
 2 Additional Information This communication relates to a proposal which Westlake has made for a business combination transaction with Axiall. In connection with the solicitation of proxies for Axiall’s 2016 annual meeting of stockholders (including any adjournment or postponement thereof and any meeting of Axiall’s stockholders that may be called in lieu thereof, the “Annual Meeting”), Westlake filed a definitive proxy statement in connection therewith on Schedule 14A with the SEC on April 25, 2016 (the
“Westlake Proxy Statement”). In connection with the
proposal and subject to future developments, Westlake (and, if a negotiated transaction is agreed, Axiall) may also file one or more registration statements, additional proxy statements, tender offer statements, prospectuses or other documents with the SEC. This communication is not a substitute for the Westlake
Proxy Statement or any other proxy statement,
registration statement, tender offer statement, prospectus or other document Westlake and/or Axiall has filed or may file with the SEC in connection with the proposed transaction. INVESTORS AND SECURITY HOLDERS OF WESTLAKE AND AXIALL ARE URGED TO READ THE WESTLAKE PROXY STATEMENT AND ANY OTHER PROXY STATEMENT(S), REGISTRATION STATEMENT(S), TENDER OFFER STATEMENT(S), PROSPECTUS(ES) AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY IN
THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE AS THEY WILL CONTAIN
IMPORTANT INFORMATION ABOUT THE ANNUAL MEETING AND/OR PROPOSED
TRANSACTION. Westlake expects to mail the Westlake Proxy Statement and accompanying GOLD proxy card to stockholders of Axiall promptly after Axiall sets the record date and meeting date for the 2016 Annual Meeting. Any other definitive proxy statement(s) or prospectus(es) (if and when available) will be mailed
to stockholders of Westlake and Axiall,
as applicable. Investors and security holders will be able to obtain copies of these documents (if and when available) as well as other filings containing information about Westlake and Axiall, without charge, at the SEC’s website, http://www.sec.gov. Those documents, when filed, as well as Westlake’s other
public filings with the SEC, may be obtained without
charge at Westlake’s website at http://www.westlake.com. Participants in Solicitation Westlake, Westlake NG IV Corporation and certain of their respective directors and executive officers and the individuals nominated by Westlake for election to Axiall’s Board of Directors may be deemed to be participants in any solicitation of proxies from Axiall’s stockholders in connection with the Annual Meeting and/or the proposed transaction, as applicable, under the rules of the SEC. Information about the participants, including a description of their direct and indirect interests,
by security holdings or otherwise, is available in the Westlake Proxy
Statement and will be available in any other proxy statement(s) or prospectus(es) (if and when available). You can obtain free copies of these documents from Westlake using the contact information above. Investors may obtain additional information regarding the interest of such participants by
reading the Westlake Proxy Statement and/or any other proxy
statement/prospectus regarding the proposed transaction if and when they become available. This document shall not constitute an offer to sell, buy or exchange or the solicitation of an offer to sell, buy or exchange any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended. Contacts Media Inquiries: Sard Verbinnen & Co Jim Barron / Robin Weinberg, (212) 687-8080 jbarron@sardverb.com / rweinberg@sardverb.com Investor Inquiries: Westlake Chemical Corp. Steve Bender, (713) 960-9111 or MacKenzie Partners Dan Burch / Charlie Koons, (212) 929-5708 dburch@mackenziepartners.com / ckoons@mackenziepartners.com |
 Key Topics to
be Addressed 3
I. Summary of Westlake Proposal and Decision To Nominate Directors II. Why Westlake: History of Value Creation III. Westlake Proposal: Highly Compelling Value Proposition IV. Axiall: Failure to Create Shareholder Value V. Westlake Director Nominees: Independent and Well Qualified to Create Shareholder Value |
  Summary of
Westlake Proposal and Decision To Nominate Directors
|
 Highly
Compelling Proposal to Axiall Shareholders
5 Substantial Premium 143% premium to the closing share price as of January 22, 2016 (a) Attractive Valuation Total value of the revised proposal is $3.1 billion, which represents 9.3x Axiall’s LTM Adjusted EBITDA (b) for the whole Axiall group, including Building Products Cash and Stock Consideration Cash and stock proposal values Axiall at $23.35 per share (c) Consideration includes $14.00 cash – provides immediate liquidity and certainty Stock consideration of 0.1967 of a Westlake share, or $9.35 per share (c) Compelling Strategic Logic Improved scale, resiliency and product / geographic diversity Backward integration into ethylene Improved financial profile with anticipated investment grade rating Significant Synergies Upside potential through stock component in proposal Expected $90-100mm annual synergies Speed to Closing and Certainty No financing contingency No anticipated regulatory issues Dedicated resources in place to ensure an efficient integration (a) Revised Proposal of $23.35 per share reflects $14 per share in cash and 0.1967 in Westlake common stock based on the closing price of Westlake
stock on April 1, 2016 (the last trading date before Westlake’s
revised proposal was made public). Implied premium is based off the unaffected
closing price of Axiall stock on January 22, 2016 (the last trading date before Westlake’s initial proposal was made) (b) LTM EBITDA of $330.3mm for FY2015 (c) Based on closing price of Westlake stock on April 1, 2016 (the last trading date before Westlake’s revised proposal was made public).
|
 Strategically
Compelling Proposal 6
Axiall Standalone Strategy
Combined Westlake-Axiall Strategy
Announced initiatives are not game changers
and are likely already priced into the stock
Proposal reflects 143% premium to unaffected stock
price (a) for the whole Axiall group, including Building Products Maintain opportunity to capture cycle recovery through a stronger company with a clear value creation strategy Bet on volatile commodity prices Long-term integration strategy captures value throughout commodity cycle Stock consideration facilitates Axiall shareholder participation in cyclical recovery Building Products divestment strategy results in riskier business profile and cost disadvantaged operating model Increased scale improves cost position Maintain strategic flexibility through strong balance sheet History of value destructive acquisitions and mergers (PPG Commodity Chemicals, Royal Building Products) Over-levering business resulted in equity holders getting nearly wiped out in 2009 debt for equity exchange Strong balance sheet support continued investment in the business (upstream and downstream) Experienced management with strong track record of value creation and history of delivering on commitments (a) Revised Proposal of $23.35 per share reflects $14 per share in cash and 0.1967 in Westlake common stock based on the closing price of Westlake
stock on April 1, 2016 (the last trading date before Westlake’s
revised proposal was made public). Implied premium is based off the unaffected
closing price of Axiall stock on January 22, 2016 (the last trading date before Westlake’s initial proposal was made) |
 Background to
the Proposed Combination 7
(a)
Initial Proposal of $20 per share reflects $11 per share in cash
and 0.1967 in Westlake common stock based on the closing price of Westlake stock on January 22, 2016. Implied premium is based off the unaffected closing price of Axiall stock on January 22, 2016 (the last trading date before Westlake’s initial proposal was made) (b)
Revised Proposal of $23.35 per share reflects $14 per share in cash and 0.1967 in
Westlake common stock based on the closing price of Westlake stock on April 1, 2016 (the last trading date before Westlake’s revised proposal was made public). Implied premium is based off the unaffected closing price of Axiall stock on January 22, 2016 (the last
trading date before Westlake’s initial proposal was made)
January 25: Westlake meets with Axiall and indicates a desire to acquire the business for $20 per share representing 108% premium (“Initial Proposal”) (a) January 27: Axiall rejects the Initial Proposal February 16: Westlake informs Axiall of its intention to nominate directors at Axiall’s next Annual Meeting March 7: Westlake issues public letter voicing concern about Axiall management’s unwillingness to negotiate and strategy to sell the Building Products business in the face of a proposal for the entire company
March 8: Axiall informs Westlake of its willingness to engage in discussions March 18 - 28: Westlake attends Axiall management presentation and undertakes limited due diligence Axiall provided March 29: Westlake privately increases its proposal to $23.35 per share, representing 143% premium (b) (“Revised Proposal”) March 31: Axiall rejects the Revised Proposal, apparently preferring a standalone strategy including a sale of Building Products
April 1: Following a request for feedback on the Revised Proposal, Axiall’s advisors inform Westlake they have been instructed not to provide any feedback or guidance April 4: Given Axiall’s unwillingness to negotiate, Westlake makes public its Revised Proposal representing 143% premium April 8, 11: Westlake informs Axiall it will not bid for the Building Products business and indicates its concern over the hastiness and potential value destruction associated with a Building Products sale |
 No Alternative
Other Than to Go Directly to Shareholders 8
Westlake continues to believe that its proposal is in the best interests of
Axiall shareholders
The Revised Proposal represents significantly greater value and certainty than
Westlake believes can be achieved by Axiall’s
standalone strategy Cash component provides certainty at a premium to unaffected stock price and stock
component allows for upside value creation in a larger and more diverse
company However, the Axiall
Board refuses to provide feedback or negotiate with Westlake
regarding its Revised Proposal
As a result, Westlake is moving forward with the nomination of nine independent,
experienced and highly-qualified directors
Westlake urges all Axiall
shareholders to elect new directors at Axiall’s
Annual Meeting by voting for the GOLD card |
 Why
Westlake: History of Value Creation |
 Acquired
Certain Teed, Petro 2
Ethylene & Geismar Chlor Alkali Expansion A History of Strong Integration and Strategic Growth Capacity (mm lbs.) Vinyls Olefins Company Begins Operation in LC Acquired VCM in Calvert Started Petro 1 Acquired PVC Plant Acquired Geismar VCM/PVC Plant Acquired 1 Pipe Plant Acquired 3 Pipe Pants; Calgary Window Plant Start Suzhou China Film Plant Increased LDPE By 500 mm/lbs Acquired CAO Started Petro 2 Started Poly 3 Started Suzhou PVC Plant Acquired NY Windows Plant Started Styrene Acquired 3 Pipe Plants IPO 20th Anniversary Acquired Longview 10 Acquired Vinnolit, Calvert City Ethylene / PVC Expansion Petro 1 Ethylene Expansion 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 |
 Westlake's
History of Superior Profit Growth Driven by Efficient Capital
Deployment 11
Westlake has a proven history that maximizes
returns and builds shareholder value
High-return strategy prioritizing brownfield /
de-bottlenecking initiatives
Axiall’s strategy has been value destructive Underinvestment in operations has resulted in outages and earnings underperformance Past acquisitions have destroyed shareholder value (2006 Royal Building Products (a) acquisition and 2013 PPG Commodity Chemicals merger) Pursuing current Building Products sale process while spurning Westlake's superior proposal demonstrates the apparent misalignment between Axiall management’s and shareholders’ interests (a) At the time known as Royal Group Technologies Source: Public filings Gross PP&E, '05 - '15 CAGR (%) |
 Axiall
Board and Management Ownership Comparison
of Total Shareholder Return – Last 10 Years (a) Westlake share ownership at board and management level aligns interests with those of shareholders Westlake has delivered superior total shareholder return relative to competitors and the S&P 500 Alignment of Interests Between Westlake’s Top Management and Shareholders is Key to Westlake’s Value Creation 12 Source: Thomson, 13F filings as of December 31, 2015 and subsequent 13D/G filings, public filings, Bloomberg. Market data as of January 22, 2016
which is the last unaffected stock price for both Westlake and Axiall
(a) 10 years from January 20, 2006 to January 22, 2016, which is the last trading date before Westlake’s initial proposal was made
(b) Includes Tim Mann (CEO) (Form 4, March 10, 2016), Gregory Thompson (CFO) (Form 4, March 10, 2016), Simon Bates (SVP Building Products) (Form 4,
September 28, 2015), Daniel Fishbein (VP and General Counsel) (Form 4,
March 10, 2016), Bill Doherty (SVP, Chemicals) (Form 4, March 10, 2016), and Dean Adelman (VP, Human Resources) (Form 4, March 10, 2016) 241.7 % (98.6)% 11.1 % 86.9 % Westlake Axiall Olin S&P 500 Conversely, Axiall has limited ownership at board and management level Entirety of Axiall Senior Leadership Team owns less than 1% of Axiall shares (less than Westlake owns) Institutional and Retail 94.6% Axiall Board 0.2% Axiall Management 0.8% Westlake 4.4% (b) |
 Westlake
Proposal: Highly Compelling Value Proposition
|
 Combination
Creates a North American
Vinyls Leader 14 Note: PVC and Chlor-alkali represent respective companies capacity levels Source: IHS Chemical North American PVC capacity North America Chlor-alkali capacity Top 3 North American PVC / Chlor-alkali producer 0 500 1,000 1,500 2,000 2,500 3,000 Shintech Combined Oxy FPC Axiall Mexichem Westlake 0 1,000 2,000 3,000 4,000 5,000 6,000 Olin Oxy Combined Axiall Shintech FPC Westlake |
 Highly
Integrated Chain in the U.S. Should Enhance Margin Stability for the
Combined Company 15
The combined company is expected to have a lower cost structure due to
integration which enhances margin stability
With its operational expertise and strong balance sheet, Westlake should
be able to efficiently access significant additional ethylene capacity
v Polyethylene Styrene Chlorine Ethylene Vinyls PVC Building Products Gas-based feedstock capability Ethylene Expansion Expansion Olefins Vinyls |
 Combination
Would Create a Stronger Company With Demonstrated Track Record of Enhancing
Shareholder Value 16
2015 net sales ($bn) 2015 EBITDA margin (%) Net debt / 2015 EBITDA Who would you rather be a shareholder of? Axiall? Westlake + Axiall? Smaller, one-dimensional company with exposure to a single, volatile commodity Larger, more stable producer with product and value-chain diversification to capture margins throughout cycle Leveraged, small-scale company and shrinking Robust balance sheet with investment grade ratings History of value-destructive investments Track record of earnings growth through disciplined investments and acquisitions 3.8x 3.2x 1.9x 1.0x (0.3x) Olin Axiall Mexichem WLK + AXLL Westlake 28% 21% 16% 13% 10% Westlake WLK + AXLL Mexichem Olin Axiall $7.8 $6.9 $5.7 $4.5 $3.4 WLK + AXLL Olin Mexichem Westlake Axiall Note: Combined financials illustratively include $95m of expected synergies, which is the midpoint of Westlake’s $90-100mm synergies estimate.
Westlake + Axiall net debt / LTM EBITDA reflects $14 / share in cash
consideration. Olin sales and EBITDA figures are 2014 Pro Forma per S-4 filed
September 2, 2015 (Olin EBITDA includes $200 million of expected synergies estimated by management). Source: Public filings |
 Westlake
Believes Axiall’s View of Synergies is Unrealistic and Overly
Optimistic Axiall's
synergy estimates were prepared without any familiarity with Westlake operations or
input from Westlake Excludes dis-synergies
and costs to achieve Overly reliant on difficult to achieve revenue synergies Significant Potential Upside from Synergy Opportunity for Axiall Shareholders Westlake Synergy View Total expected run-rate synergies of $90-100mm reflected in proposal of $23.35 (a) Synergy estimate prepared following careful review of business overlap including cost to achieve and potential dis-
synergies in combination
Westlake’s proposal provides Axiall shareholders with the opportunity to
participate in any additional synergy creation through the stock
component 17
General & Administrative Procurement / Supply Chain Manufacturing Sales & Marketing (a) Based on closing price of Westlake stock on April 1, 2016 (the last trading date before Westlake’s revised proposal was made
public). |
 $14.00
$9.35
$23.35 $9.60 $11.32 Westlake Proposal Axiall Pre-Proposal Price (Jan. 22) Implied Axiall Share Price Based on OIin Performance Since Unaffected Date Westlake Proposal Allows Axiall Shareholders to Crystallize Value and Participate in Upside Potential and Synergies 18 (3%) Source: FactSet (11%) Significant downside risk for Axiall shareholders Westlake’s proposal represents a significant premium to Axiall’s unaffected share price Cash component crystallizes $14 in value – on its own a premium to Axiall’s unaffected share price, providing certainty relative to Axiall’s standalone plan Significant participation in combined company upside including synergy value through stock component (b) (a) Note: Axiall Pre-Proposal Price is based off the unaffected closing price of Axiall stock on January 22, 2016 (the last trading date before
Westlake’s initial proposal was made)
(a) Revised Proposal of $23.35 per share reflects $14 per share in cash and 0.1967 in Westlake common stock based on the closing price of Westlake
stock on April 1, 2016 (the last trading date before Westlake’s
revised proposal was made public). (b) Calculated as Axiall unaffected share price on January 22, 2016 of $9.60 multiplied by (1+18%) (Olin share price return from January 22, 2016
through April 1, 2016) |
 Axiall:
Failure to Create Shareholder Value |
 Axiall
Management Has Repeatedly Failed to Deliver on Expectations
20 At various points over last 4 years, Axiall announced that ECU margins have reached a “trough” or a “floor” level Jul 19, 2012 (a)` “… we illustrate the dramatic improvement in mid-cycle and trough EBITDA
that comes from this combination. We expect
combined mid-cycle EBITDA of over $850 million, including cost
synergies […] Likewise, trough EBITDA for the combined company
will exceed $550 million”
Dec 3, 2013 (b) “2013-2016 Growth 2-3% per year plus exports will balance market” May 6, 2014 (c) “And I would say, at this level, there's a bit of pain to go much lower than where we were or have been. So, that's another reason for saying that we expected, as a general comment, that we were at the floor of ECUs at this point in
time.” Nov 3,
2015 (d) “We also want to be respectful of the balance sheet and the right level of leverage given the trough conditions that we're at right
now.” Feb 11, 2016 (e) “Axiall expects to have significant operating leverage as the
chlor- alkali industry comes out of the
trough” “Industry capacity rationalization underway; historically, caustic
prices start to recover within approximately 6-12 months” Feb 25, 2016 (f) “We now believe that we have bottomed and that we are at the
beginning of what should be a multiyear improvement in
ECU margins as the cycle turns” Axiall Forecasted Performance through Cycle (a) Facts / Realized Performance (g) Axiall has underperformed investor expectations every year since merger with PPG Commodity Chemicals (h) Axiall’s Management has been unable to assess “trough” performance levels for its business >$850 >$550 $ 672 $ 436 $ 330 Mid-Cycle Trough FY 2013A FY 2014A FY 2015A $826 $740 $585 $329 $672 $436 $330 ? FY 2013A FY 2014A FY 2015A FY 2016E Consensus Broker Estimates Dec-31 Realized LTM EBITDA (19)% (41)% (44)% Source: Axiall public filings, earnings release transcripts, investor presentations (a) Paul Carrico, PPG merger transcript and presentation. Includes projected EBITDA contribution of the divested Aromatics business of approximately $40mm and $15mm in the Mid-Cycle and Trough estimates, respectively. Realized performance of the Aromatics business is included in the FY 2013A and FY 2014A realized EBITDA but not in FY 2015A (as the business was divested) / (b) Citibank Basic Materials Conference, quote from presentation / (c) Paul Carrico, President & CEO, 2014 Q1 Earnings Call Q&A / (d) Greg Thompson, CFO, 2015 Q3 Earnings Call Q&A / (e) Axiall “Investor Update” presentation released on February 11, 2016 / (f) Tim Mann, CEO, Q4 2015 Earnings Call / (g) Synergy amount from Georgia Gulf and PPG Chemicals RMT of $140mm as per Greg Thompson, CFO, at Bank of America Merrill Lynch Leveraged Finance Conference, December 3, 2014 / (h) For historical periods (FY 2013, FY 2014, FY 2015), consensus broker estimates reflect IBES median estimate as of January 1 of the corresponding period. For the projected period (FY 2016E), the consensus broker estimate reflects the current IBES median estimate as of April 22, 2016 |
 Axiall Has a Track Record of Value Destruction 21 Source: Axiall filings Strategic Decision Outcome Overpaid for Acquisition of Building Products (2006, 2011) Acquired Royal Group Technologies for ~$1.6bn; transaction entirely financed with debt, bringing leverage to ~6.5x end of FY2007 Acquired Crane Plastics Siding for ~$72mm Sold Window and Door Profiles and Solucor for a combined $41mm Investments in Building Products business of ~$1.7bn Total expected proceeds from sale of Building Products of ~$0.7bn (a) Weakened Balance Sheet Leads to Costly Debt for Equity Exchange (2009) Poorly positioned in 2009 to deal with financial distress with a significantly weakened balance sheet
Executed a debt for equity exchange which nearly wiped-out all value of shareholders Overpaid for Merger with PPG Commodity Chemicals (2013) Merger with PPG Commodity Chemicals for ~$2.1bn driven by apparent desire to remain
independent in response to earlier proposal from Westlake
~$850mm impairment charge taken in 2015 from the PPG merger Missed Ethylene Super- Cycle Due to Misguided Strategy and Slow Execution (2009 - 2019) Failed to backward integrate chlorovinyls operations into ethylene, and missed the Ethylene Super- Cycle Announced ethylene JV not expected on-line until 2019 at earliest; Axiall will not realize benefit until almost a decade after the beginning of the Ethylene Super-Cycle Rejection of Attractive Westlake Proposal (2016) Axiall rejected Westlake’s proposal representing 143% premium (b) (a) Reflects sale of Window and Door Profiles and Solucor for a combined $41mm plus midpoint of Axiall’s estimated range of $600 – 700mm net
proceeds that could be generated in a sale based on Axiall press release
dated April 7, 2016. (b) Revised Proposal of $23.35 per share reflects $14 per share in cash and 0.1967 in Westlake common stock based on the closing price of Westlake
stock on April 1, 2016 (the last trading date before Westlake’s
revised proposal was made public). Implied premium is based off the unaffected
closing price of Axiall stock on January 22, 2016 (the last trading date before Westlake’s initial proposal was made) |
 Axiall’s “Major Initiatives” Have Not Unlocked Value for Shareholders 22 Axiall’s So-Called “Major Initiatives” (a) Stock Price Impact on Announcement Date Stock Price Performance since Announcement Date (b) ? Summer 2015: Renegotiation of ethane cracker joint venture with Lotte Chemical 0.7% (75.6)% ? July 2015: Paul Carrico resigns; Tim Mann appointed Interim President and CEO; named President and CEO, November 2015 4.1% (71.8)% ? October 2015: Sale of aromatics business resulting in up to $93 million in proceeds (0.8)% (38.8)% ? December 2015: Final investment decision reached on ethane cracker joint venture (3.0)% (29.9)% ? February 2016: Realized 25% of $100 million cost reduction target (c) Likely priced-in given objective was previously announced and at this stage only partially reached ? February 2016: Announces sale of Window and Door Profiles and Solucor Business (c) Sale of Building Products business puts value at risk (a)
According to Axiall Investor Update presentation on February 11, 2016, except for
announcement of sale of Window and Door Profiles and Solucor Business (press release as of February 25, 2016)
(b)
Stock price performance represents percent change from announcement to unaffected stock
price of $9.60 on January 22, 2016 (c)
Stock price reaction not shown where event occurred after Westlake proposal was made
public Note: Assumed announcement dates as follows: ethane cracker JV renegotiated on June 17, 2015, Tim Mann appointed interim CEO on July 6, 2015, Sale of
Aromatics business on October 1, 2015, Final decision on ethane JV on
December 17, 2015 and 25% realization of cost reduction on February 11, 2016 |
 Westlake
Director Nominees: Independent and Well Qualified to Create Shareholder
Value |
 Board
Nominee Independent
CEO / CFO Experience Chemicals / Energy Industry Expertise M&A / Finance Experience Public Company Board Experience Steven Blank Michael Campbell Charles Crew (a) Ruth Dreessen Angela Minas David Reeves (a) James Swent III Gary Whitlock Randy Woelfel (a) Experience of Axiall Board Nominees 24 (a) Private company Board experience. Charles Crew serves on the board of directors of Dubois Chemicals Company and Restaurant Technologies.
David Reeves served on the ChevronPhillips Chemical Company board of
directors from 2012 to 2014. Randy Woelfel served as CEO and a director of NOVA Chemicals from 2009 to 2014. |
 Nominee Age Experience Steven Blank 61 Former Executive Vice President, CFO and Treasurer of NuStar GP, LLC and NuStar GP Holdings LLC Currently an Independent Director of TransMontaigne GP, L.L.C. the general partner of TransMontaigne Partners L.P., and Dakota Plains Holdings, Inc. Michael Campbell 69 Former Chairman, President and CEO of Arch Chemicals, Inc., and Executive Vice President of Olin Corporation Currently an Independent Director of WestRock Company Former Director of Milliken & Company and former Chairman of the American Chemistry Council Charles Crew 64 Former Executive Vice President and President, CEO, SABIC Innovative Plastics, Saudi Basic Industries Corporation (SABIC) and long-time executive of
GE Plastics, General Electric Company (GE)
Currently an Independent Director of DuBois Chemicals
Ruth Dreessen 60 Managing Director of Lion Chemical Partners LLC Former Executive Vice President and CFO of TPC Group Inc. and Senior Vice President and CFO of Westlake Chemical Corporation from 2003-2005 Currently Chairman of Gevo Former Director of Georgia Gulf Corporation (a predecessor to Axiall) from 2001-
2003, Targa Resources Partners LP and Versar, Inc.
Angela Minas 52 Independent Director and Chair of the Audit Committee of CONE Midstream Partners LP and Independent Director of Ciner Resources LP (formerly OCI Resources LP) Former Vice President and CFO of DCP Midstream Partners Proposed Axiall Board Nominees 25 |
 Nominee Age Experience David Reeves 60 Former President of Strategy, Planning and Technology, and long-time executive
of Chevron Corporation
Former Director of ChevronPhillips Chemical Company (CPChem)
James Swent III 65 Former Executive Vice President and CFO of Ensco plc., Co-Founder and Managing Director of Amrita Holdings, LLC, CFO and CEO of Cyrix Corporation and CFO and CEO of American Pad and Paper Company Gary Whitlock 66 Former Executive Vice President and CFO of CenterPoint Energy, Inc. and Vice President of Finance and CFO of Dow AgroSciences, a subsidiary of The Dow Chemical Company Former Director of various Dow entities, Texas Genco Holdings, Inc., KiOR, Inc.
and Enable Midstream Partners, LLC
Randy Woelfel 61 Former CEO of NOVA Chemicals, Inc., President of Basell International and Basell North America (now part of LyondellBasell) and longtime employee of Royal Dutch Shell plc (Shell) Currently an Independent Director of Black & Veatch and advisor to several
petrochemicals and plastics companies
Proposed Axiall Board Nominees
26 |
 Conclusions
– Vote GOLD Card for New Director Nominees
27 • Why Westlake: History of Value Creation • Westlake Proposal: Highly Compelling Value Proposition • Axiall: Failure to Create Shareholder Value • Westlake Director Nominees: Independent and Well Qualified to Create Shareholder Value Vote GOLD Card to Elect New Director Nominees |