December 22nd, 2005
A final agreement has been signed by Australian manufacturer, James Hardie Industries, after the company was given a timescale in which to agree to a settlement before being forced into coming to an agreement. The deal was signed on Thursday of last week, and the estimated cost to the company is around $4.5 billion, which will be paid out over the next four decades. Each year throughout this settlement period, the company will have to pay thirty-five percent of its disposable cash flow into a fund for payment of compensation.
The company had been seeking immunity against civil proceedings against directors and executives through its agreement with the New South Wales government, but it is reported that this immunity has not been awarded. Those prosecuted as part of these proceedings could face up to five years in prison.
The civil cases that could affect certain managers and executives of the company relate to providing misinformation to the stock exchange with regards to the funding of its compensation fund, which the stock exchange was told was fully funded. The cases also relate to the cancellation of $1.9 billion in shares.
It is unlikely that there will be any charges until the middle of 2006, as officials are still conducting witness interviews and assessing documentation and evidence.
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