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EXHIBIT 10.11
U.S. $125,000,000
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of December 28, 1995
Among
WHEELING-PITTSBURGH STEEL CORPORATION
as Borrower
and
THE LENDERS PARTY HERETO
as Lenders
and
CITIBANK, N.A.
as Agent and as Initial Issuing Bank
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T A B L E O F C O N T E N T S
Section Page
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ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms................................................ 2
1.2. Computation of Time Periods.................................. 30
1.3. Accounting Terms............................................. 30
1.4. Certain Terms................................................ 30
ARTICLE II
AMOUNTS AND TERMS OF THE LOANS
2.1. The Revolving Credit Loans................................... 30
2.2. The Swing Loans.............................................. 31
2.3. Making the Loans............................................. 31
2.4. Fees......................................................... 33
2.5. Reduction and Termination of the Revolving Credit Commitments 33
2.6. Repayment.................................................... 33
2.7. Prepayments.................................................. 33
2.8. Conversion/Continuation Option............................... 35
2.9. Interest..................................................... 36
2.10. Interest Rate Determination.................................. 36
2.11. Increased Costs.............................................. 37
2.12. Illegality................................................... 37
2.13. Capital Adequacy............................................. 38
2.14. Payments and Computations.................................... 38
2.15. Taxes........................................................ 40
2.16. Sharing of Payments, Etc..................................... 42
2.17. Letter of Credit Facility.................................... 43
2.18. Settlement of Accounts....................................... 49
2.19. The Blocked Account.......................................... 49
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ARTICLE III
CONDITIONS PRECEDENT
3.1. Conditions Precedent to the Effective Date................... 50
3.2. Additional Conditions Precedent to the Effective Date........ 54
3.3. Conditions Precedent to Each Loan and Letter of Credit....... 55
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.1. Corporate Existence; Compliance with Law..................... 56
4.2. Corporate Power; Authorization; Enforceable Obligations...... 57
4.3. Taxes........................................................ 58
4.4. Full Disclosure.............................................. 58
4.5. Financial Matters............................................ 59
4.6. Litigation................................................... 60
4.7. Margin Regulations........................................... 60
4.8. Ownership of the Borrower and Subsidiaries................... 60
4.9. ERISA........................................................ 61
4.10. Liens........................................................ 62
4.11. First Mortgage Notes; Permanent Financing Notes.............. 62
4.12. No Burdensome Restrictions; No Defaults...................... 63
4.13. No Other Ventures............................................ 63
4.14. Investment Company Act....................................... 63
4.15. Insurance.................................................... 63
4.16. Labor Matters................................................ 64
4.17. Force Majeure................................................ 65
4.18. Use of Proceeds.............................................. 65
4.19. Environmental Protection..................................... 65
4.20. Intellectual Property........................................ 67
4.21. Title........................................................ 67
ARTICLE V
FINANCIAL COVENANTS
5.1. Maintenance of Tangible Net Worth............................. 69
5.2. Maintenance of Leverage Ratio................................. 70
5.3. Maintenance of Interest Coverage Ratio........................ 71
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5.4. Maintenance of Cumulative Cash Flow.......................... 72
5.5. Limitation on Capital Expenditures........................... 72
ARTICLE VI
ADDITIONAL AFFIRMATIVE COVENANTS
6.1. Compliance with Laws, Etc.................................... 73
6.2. Conduct of Business.......................................... 73
6.3. Payment of Taxes, Etc........................................ 74
6.4. Maintenance of Insurance..................................... 74
6.5. Preservation of Corporate Existence, Etc..................... 74
6.6. Access....................................................... 74
6.7. Keeping of Books............................................. 75
6.8. Maintenance of Properties, Etc............................... 75
6.9. Application of Proceeds...................................... 75
6.10. Financial Statements......................................... 75
6.11. Reporting Requirements....................................... 78
6.12. Employee Plans............................................... 82
6.13. Fiscal Year.................................................. 82
6.14. Borrowing Base Determination................................. 82
6.15. Environmental................................................ 83
ARTICLE VII
NEGATIVE COVENANTS
7.1. Liens, Etc................................................... 83
7.2. Indebtedness................................................. 86
7.3. Lease Obligations............................................ 87
7.4. Restricted Payments.......................................... 88
7.5. Mergers, Stock Issuances, Sale of Assets, Etc................ 89
7.6. Investments in Other Persons................................. 91
7.7. Change in Nature of Business................................. 92
7.8. Material Agreements.......................................... 92
7.9. Accounting Changes........................................... 93
7.10. Contingent Obligations....................................... 93
7.11. Transactions with Affiliates................................. 93
7.12. Cancellation of Indebtedness Owed to It...................... 94
7.13. No New Subsidiaries.......................................... 95
7.14. Capital Structure............................................ 95
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7.15. No Speculative Transactions................................ 95
7.16. Margin Regulations......................................... 95
7.17. Bank Accounts.............................................. 95
7.18. Environmental Release...................................... 96
ARTICLE VIII
EVENTS OF DEFAULT
8.1. Events of Default........................................... 96
8.2. Remedies.................................................... 99
8.3. Actions in Respect of Letters of Credit..................... 100
ARTICLE IX
THE AGENT
9.1. Authorization and Action.................................... 101
9.2. Agent's Reliance, Etc....................................... 102
9.3. Citibank, Citicorp and Affiliates........................... 102
9.4. Lender Party Credit Decision................................ 103
9.5. Indemnification............................................. 103
9.6. Successor Agent............................................. 105
ARTICLE X
MISCELLANEOUS
10.1. Amendments, Etc............................................. 106
10.2. Notices, Etc................................................ 107
10.3. No Waiver; Remedies......................................... 108
10.4. Costs; Expenses; Indemnities................................ 108
10.5. Right of Set-off............................................ 111
10.6. Binding Effect.............................................. 111
10.7. Assignments and Participations.............................. 111
10.8. Governing Law............................................... 114
10.9. Submission to Jurisdiction.................................. 114
10.10. Section Titles.............................................. 115
10.11. Execution in Counterparts................................... 115
10.12. No Liability of the Issuers................................. 115
10.13. Entire Agreement............................................ 116
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10.14. Confidentiality............................................. 116
10.15. Waiver of Jury Trial........................................ 116
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SCHEDULES
Schedule I - List of Issuers
Schedule II - Commitments
Schedule III - List of Applicable Lending Offices and Addresses for
Notices
Schedule IV - Borrowing Base Advance Rates
Schedule 2.3 - List of Eligible Signatories
Schedule 3.1 - UCC Termination Statements
Schedule 4.3 - Taxes
Schedule 4.6 - Litigation
Schedule 4.8 - List of Subsidiaries
Schedule 4.9 - List of Plans
Schedule 4.10 - List of Liens
Schedule 4.13 - Joint Ventures
Schedule 4.16 - Labor
Schedule 4.19 - Environmental Protection
Schedule 4.21(a) - List of Owned Real Estate
Schedule 4.21(b) - List of Leased Real Estate
Schedule 4.21(c) - Existing Options
Schedule 7.1 - Existing Liens
Schedule 7.2 - Existing Indebtedness
Schedule 7.3 - Leases
Schedule 7.4 - Restricted Payments
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Schedule 7.6 - Existing Investments
Schedule 7.10 - Contingent Obligations
Schedule 7.11 - Transactions with Affiliates
Schedule 7.17 - Permitted Bank Accounts
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EXHIBITS
Exhibit A - Form of Revolving Credit Note
Exhibit B - Form of Notice of Borrowing
Exhibit C - Form of Letter of Credit Request
Exhibit D - Form of Notice of Conversion or Continuation
Exhibit E - Form of Assignment and Acceptance
Exhibit F - Form of Borrowing Base Certificate
Exhibit G - Form of Borrower Security Agreement
Exhibit H - Form of Borrower Pledge Agreement
Exhibit I - Form of Holdings Guaranty
Exhibit J - Form of Holdings Pledge Agreement
Exhibit K - Form of Guaranty
Exhibit L - Form of Guarantor Security Agreement
Exhibit M - Form of Keepwell Agreement
Exhibit N - Form of Holdings Intercreditor Agreement
Exhibit O-1 - Opinion of Xxxxxx Xxxxxxxx Frome & Xxxxxxxxxx
-- Outside Counsel for the Borrower
Exhibit O-2 - Opinion of Xxxxxxxxxxx & Xxxxxxxx
-- Local Counsel for the Borrower
Exhibit P - Form of Guarantor Intercompany Notes
Exhibit Q - Form of Cash Collateral Account Agreement
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SECOND AMENDED AND RESTATED CREDIT AGREEMENT, dated as of
December 28, 1995, among Wheeling-Pittsburgh Steel Corporation, a Delaware
corporation (the "Borrower"), the financial institutions listed on the signature
pages hereof (each individually a "Lender" and collectively the "Lenders"), and
Citibank, N.A. ("Citibank"), as agent hereunder for the Lenders (in such
capacity, together with any successor appointed pursuant to Article IX, the
"Agent"), and as issuer of letters of credit (the "Initial Issuing Bank").
PRELIMINARY STATEMENTS.
1. The Borrower is a party to an Amended and Restated Credit
Agreement, dated as of October 24, 1994, as amended by Amendment Xx. 0, xxxxx xx
xx Xxxxxxx 00, 0000 (xx amended, the "1994 Credit Agreement"), with the
financial institutions party thereto and Citibank, as agent.
2. Wheeling-Pittsburgh Corporation, a Delaware corporation
("Holdings"), is the direct parent of the Borrower and WHX Corporation, a
Delaware corporation ("WHX") is the direct parent of Holdings.
3. The Borrower and Holdings have requested that the Lenders,
the Issuers (as hereinafter defined) and the Agent amend and restate the 1994
Credit Agreement to, among other things, increase the Commitments and extend the
Termination Date (as such terms are defined in the 1994 Credit Agreement).
4. The Lender Parties (as hereinafter defined) have indicated
their willingness to agree to amend and restate the 1994 Credit Agreement on the
terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and the
covenants and agreements contained herein, the parties hereto agree that the
1994 Credit Agreement is hereby amended and restated as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms. As used in this Agreement, the following
terms have the following meanings (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):
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"Accounts" has the meaning specified in the Borrower Security
Agreement and in the Guarantor Security Agreement.
"Adjusted EBITDA" means, for any Person for any period, the
EBITDA for such Person for such period plus any increase in the long term
liability in respect of other post-employment benefits that would be reflected
on a consolidated balance sheet of such Person and its Subsidiaries (the
"Employee Liability") for such period less any decrease in the Employee
Liability for such period.
"Adjusted Net Worth" means, as to any Guarantor at the
Effective Date, the lesser of (x) the amount by which the book value of the
property of such Guarantor exceeds the total amount of liabilities on its
existing "Debt" (as such term is defined in Section 270 of the New York Debtor
Creditor Law), including, without limitation, probable contingent liabilities,
but excluding liabilities under the Guaranty, of such Guarantor at such date and
(y) the amount by which the book value of the assets of such Guarantor at such
date exceeds the amount that will be required to pay the probable liability of
such Guarantor on its Debt, excluding Debt in respect of the Guaranty, as they
become absolute and matured.
"Affiliate" means, as to any Person, any Subsidiary of such
Person and any other Person which, directly or indirectly, controls, is
controlled by or is under common control with such Person and includes each
officer or director or general partner of such Person, and each Person who is
the direct or indirect beneficial owner of 15% or more of any class of voting
Stock of such Person or, with respect to the Borrower, of Holdings or WHX. For
the purposes of this definition, "control" means the possession of the power to
direct or cause the direction of management and policies of such Person, whether
through the ownership of voting securities, by contract or otherwise.
"Agent" has the meaning specified in the recital of parties to
this Agreement.
"Agent's Account" means the account of the Agent maintained by
the Agent at Citibank at its office at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Account No. 3682 2248, Attention: Xxxxxxxxx Xxxxxxxx.
"Agreement" means this Second Amended and Restated Credit
Agreement, together with all Exhibits and Schedules hereto, as the same may be
amended, supplemented or otherwise modified from time to time.
"Applicable Lending Office" means, with respect to each Lender
Party, its Domestic Lending Office in the case of a Base Rate Loan and its
Eurodollar Lending Office in the case of a Eurodollar Rate Loan.
"Applicable Margin" means, as of any date, a percentage per
annum determined by reference to the Performance Level in effect on such date as
set forth below:
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Applicable Margin Applicable Margin Applicable Margin for
Performance Level for Base Rate Loans for Eurodollar Letter of Credit Fees
Rate Loans
I 0.00% 1.25% 0.875%
II 0.25% 1.50% 1.125%
III 0.50% 1.75% 1.375%
IV 0.75% 2.00% 1.625%
V 1.00% 2.25% 1.875%
provided that, for the period commencing on the Effective Date and ending on
December 31, 1996, the Applicable Margin shall be as set forth opposite
Performance Level III.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the Agent in
accordance with Section 10.7 and in substantially the form of Exhibit E.
"Available Credit" means, at any time, an amount equal to (i)
the lower of (a) the Revolving Credit Commitments outstanding at such time, and
(b) the Borrowing Base at such time minus (ii) the aggregate principal amount of
the Revolving Credit Loans outstanding at such time and the outstanding Letter
of Credit Obligations at such time.
"Base Rate" means, for any period, a fluctuating interest rate
per annum as shall be in effect from time to time, which rate per annum shall be
equal at all times to the highest of:
(a) the rate of interest announced publicly by Citibank in New
York, New York, from time to time, as Citibank's base rate; and
(b) the sum (adjusted to the nearest 1/4 of one percent or, if
there is no nearest 1/4 of one percent, to the next higher 1/4 of one percent)
of (i) 1/2 of one percent per annum, plus (ii) the rate per annum obtained by
dividing (A) the latest three-week moving average of secondary market morning
offering rates in the United States for three-month certificates of deposit of
major United States money market banks, such three-week moving average (adjusted
to the basis of a year of 360 days) being determined weekly on each Monday (or,
if any such day is not a Business Day, on the next succeeding Business Day) for
the three-week period ending on the previous Friday by Citibank on the basis of
such rates reported by certificate of deposit dealers to and published by the
Federal Reserve Bank of New York or, if such publication shall be suspended or
terminated, on the basis of quotations for such rates received by Citibank from
three New York certificate of
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deposit dealers of recognized standing selected by Citibank, by (B) a percentage
equal to 100% minus the average of the daily percentages specified during such
three-week period by the Board of Governors of the Federal Reserve System (or
any successor) for determining the maximum reserve requirement (including,
without limitation, any emergency, supplemental or other marginal reserve
requirement) for Citibank in respect of liabilities consisting of or including
(among other liabilities) three-month U.S. dollar nonpersonal time deposits in
the United States, plus (iii) the average during such three-week period of the
annual assessment rates estimated by Citibank for determining the then current
annual assessment payable by Citibank to the Federal Deposit Insurance
Corporation (or any successor) for insuring U.S. dollar deposits of Citibank in
the United States; and
(c) the sum (adjusted to the nearest one percent or, if there
is no nearest one percent, to the next higher one percent) of (i) one percent
per annum plus (ii) the Federal Funds Rate.
"Base Rate Loan" means any outstanding principal amount of the
Loans of any Lender Party that bears interest with reference to the Base Rate.
"Blocked Account" has the meaning specified in Section 2.19.
"Blocked Account Letter" means the letter agreement, dated
August 17, 1994, executed by the Borrower and the Agent and acknowledged and
agreed to by PNC Bank, National Association, as such letter agreement may be
amended, supplemented or otherwise modified from time to time in accordance with
the terms hereof.
"Borrower Pledge Agreement" means the pledge agreement, dated
as of August 17, 1994, as amended by Amendment No. 1, dated as of December 28,
1995, executed by the Borrower, substantially in the form of Exhibit H, as such
agreement may be further amended, supplemented or otherwise modified from time
to time.
"Borrower Security Agreement" means the security agreement,
dated as of April 12, 1991 and as amended by Amendment No. 1, dated as of August
17, 1994, and Amendment No. 2, dated as of December 28, 1995, executed by the
Borrower, substantially in the form of Exhibit G, as such agreement may be
further amended, supplemented or otherwise modified from time to time.
"Borrowing" means each of a Revolving Credit Borrowing and a
Swing Loan Borrowing.
"Borrowing Base" means, at any time, an amount up to a
percentage of the value of various categories of Eligible Inventory at such
time, as set forth on Schedule IV hereto; provided that with respect to the
Eligible Inventory of any Guarantor, such amount shall not exceed such
Guarantor's Adjusted Net Worth at the Effective Date; provided, however, that
such advance rates may be adjusted by the Agent from time to time to conform
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to the Agent's regular business practices and policies applicable to asset based
loans with advance rates based on current assets in effect from time to time
which practices and policies may be changed by the Agent in its sole discretion;
provided further, however, that such advance rates may not be adjusted above
those set forth on Schedule IV hereto without the consent of all of the Lenders.
The Agent shall provide the Borrower with two Business Days' prior written
notice of any such change.
"Borrowing Base Certificate" means a certificate of the
Borrower substantially in the form of Exhibit F.
"Business Day" means a day of the year on which banks are not
required or authorized by law to close in New York City and, if the applicable
Business Day relates to a Eurodollar Rate Loan, a day on which dealings are also
carried on in the London interbank market.
"Capital Expenditures" means, for any Person for any period,
the aggregate of all expenditures by such Person and its Subsidiaries, except
interest capitalized during construction, during such period for property, plant
or equipment, including, without limitation, renewals, improvements,
replacements and capitalized repairs, that would be reflected as additions to
property, plant or equipment on a consolidated balance sheet of such Person and
its Subsidiaries prepared in accordance with GAAP, but not including any
Investments permitted pursuant to Section 7.6. For the purpose of this
definition, the purchase price of equipment which is acquired simultaneously
with the trade-in of existing equipment owned by such Person or any of its
Subsidiaries or with insurance proceeds shall be included in Capital
Expenditures only to the extent of the gross amount of such purchase price less
the amount of the credit granted by the seller of such equipment being traded in
at such time or the amount of such proceeds, as the case may be.
"Capitalized Lease" means, as to any Person, any lease of
property by such Person as lessee which would be capitalized on a balance sheet
of such Person prepared in accordance with GAAP.
"Capitalized Lease Obligations" means, as to any Person, the
capitalized amount of all obligations of such Person or any of its Subsidiaries
under Capitalized Leases, as determined on a consolidated basis in accordance
with GAAP.
"Cash Collateral Account" has the meaning specified in the
Cash Collateral Account Agreement.
"Cash Collateral Account Agreement" means the Amended and
Restated Cash Collateral Agreement, dated as of December 28, 1995, executed by
the Borrower and the Agent, substantially in the form of Exhibit Q, as such
agreement may be further amended, supplemented or modified from time to time.
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"Cash Equivalents" means (i) securities with maturities of one
year or less from the date of acquisition issued or fully guaranteed or insured
by the United States government or any agency thereof and backed by the full
faith and credit of the United States, (ii) certificates of deposit, eurodollar
time deposits, overnight bank deposits and bankers' acceptances of any Lender
Party having maturities of one year or less from the date of acquisition, (iii)
commercial paper of an issuer rated at least A-1 by Standard & Poor's Ratings
Group or P-1 by Xxxxx'x Investors Service, Inc., or carrying an equivalent
rating by a nationally recognized rating agency if both of the two named rating
agencies cease publishing ratings of investments, and (iv) repurchase agreements
and reverse repurchase agreements relating to marketable direct obligations
issued or unconditionally guaranteed by the United States Government or issued
by any agency thereof and backed by the full faith and credit of the United
States, in each case maturing within one year from the date of acquisition,
provided that (x) the terms of such agreements comply with the guidelines set
forth in the Federal Financial Agreements of Depository Institutions with
Securities and Others, as adopted by the Comptroller of the Currency and (y)
such agreements are entered into with the Agent or any Lender Party.
"Cash Interest Expense" means, for any Person for any period,
the Net Interest Expense of such Person for such period, plus (a) interest
expense capitalized for such period to the extent deducted in the determination
of such Net Interest Expense, less (b) Non-Cash Interest Expense of such Person
for such period.
"Citibank" has the meaning specified in the recital of parties
to this Agreement.
"Citicorp" means Citicorp USA, Inc.
"Code" means the Internal Revenue Code of 1986 (or any
successor legislation thereto), as amended from time to time.
"Co-Generation Agreement" means that certain Energy Services
Agreement dated as of October 3, 1994 by and between National Power Exchange
Group, Inc. and the Borrower, as the same may be amended, modified or
supplemented from time to time.
"Collateral" means all "Collateral" referred to in the
Collateral Documents and all other property and interests in property and
proceeds thereof that is or is intended to be subject to a Lien in favor of the
Agent for the benefit of the Secured Parties.
"Collateral Documents" means the Borrower Security Agreement,
the Borrower Pledge Agreement, the Holdings Pledge Agreement, the Guarantor
Security Agreement, the Cash Collateral Account Agreement, the Blocked Account
Letter and any other document that creates or purports to create a Lien in favor
of the Agent for the benefit of the Secured Parties in connection with the Loan
Documents.
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"Commitment" means as to any Lender, such Lender's Revolving
Credit Commitment and "Commitments" means the aggregate Revolving Credit
Commitments of all Lenders.
"Commitment Fee" has the meaning specified in Section 2.4(a).
"Computation Date" has the meaning assigned to it in Section
2.18.
"Consolidated" refers to the consolidation of accounts in
accordance with GAAP.
"Contaminant" means any substance regulated or forming the
basis of liability under any Environmental Law, including, without limitation,
any waste, pollutant, hazardous substance, toxic substance, hazardous waste,
special waste, petroleum or petroleum-derived substance or waste, or any
constituent of such substance or waste.
"Contingent Obligation" means, as applied to any Person, any
direct or indirect liability, contingent or otherwise, of such Person with
respect to any Indebtedness or Contractual Obligation of another Person, if the
purpose or intent of such Person in incurring the Contingent Obligation is to
provide assurance to the obligee of such Indebtedness or Contractual Obligation
that such Indebtedness or Contractual Obligation will be paid or discharged, or
that any agreement relating thereto will be complied with, or that any holder of
such Indebtedness or Contractual Obligation will be protected (in whole or in
part) against loss in respect thereof. Contingent Obligations of a Person
include, without limitation, (a) the direct or indirect guarantee, endorsement
(other than for collection or deposit in the ordinary course of business),
co-making, discounting with recourse or sale with recourse by such Person of an
obligation of another Person, and (b) any liability of such Person for an
obligation of another Person through any agreement (contingent or otherwise) (i)
to purchase, repurchase or otherwise acquire such obligation or any security
therefor, or to provide funds for the payment or discharge of such obligation
(whether in the form of a loan, advance, stock purchase, capital contribution or
otherwise), (ii) to maintain the solvency or any balance sheet item, level of
income or financial condition of another Person, (iii) to make take-or-pay or
similar payments, if required, regardless of non-performance by any other party
or parties to an agreement, (iv) to purchase, sell or lease (as lessor or
lessee) property, or to purchase or sell services, primarily for the purpose of
enabling the debtor to make payment of such obligation or to assure the holder
of such obligation against loss, or (v) to supply funds to or in any other
manner invest in such other Person (including, without limitation, to pay for
property or services irrespective of whether such property is received or such
services are rendered), if in the case of any agreement described under
subclause (i), (ii), (iii), (iv) or (v) of this sentence the primary purpose or
intent thereof is as described in the preceding sentence. The amount of any
Contingent Obligation shall be equal to the amount of the obligation so
guaranteed or otherwise supported, except to the extent exposure of the
contingent obligor is expressly limited to a lesser amount.
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"Contractual Obligation" of any Person means any obligation,
agreement, undertaking or similar provision of any security issued by such
Person or of any agreement, undertaking, contract, lease, indenture, mortgage,
deed of trust or other instrument to which such Person is a party or by which it
or any of its property is bound or to which any of its properties is subject.
"Cumulative Cash Flow" means "net cash flow from operations"
(as such term is construed in accordance with GAAP and as such term is included
in the Projections) of the Loan Party Consolidated Group plus (a) advances made
to any Loan Party by WHX and (b) increases in the aggregate "Trust Invested
Amount" (under and as defined in the Securitization Documents) (in each case, to
the extent that such amounts have not been included in the calculation of "net
cash flow from operations") minus (a) "net cash flow from investing activities"
(as such term is construed in accordance with GAAP and as such term is included
in the Projections) of the Loan Party Consolidated Group, (b) payments made by
any Loan Party to WHX in respect of Keepwell Payments or otherwise, (c)
reductions in the aggregate "Trust Invested Amount" (under and as defined in the
Securitization Documents) and (d) repayments of the principal amount of any Debt
of the Loan Party Consolidated Group other than Debt under the Loan Documents
(in each case, to the extent that such amounts have not been included in the
calculation of "net cash flow from operations").
"Default" means any event which with the passing of time or
the giving of notice or both would become an Event of Default.
"DOL" means the United States Department of Labor, or any
successor thereto.
"Dollars" and the sign "$" each mean the lawful money of the
United States of America.
"Domestic Lending Office" means, with respect to any Lender
Party, the office of such Lender Party specified as its "Domestic Lending
Office" opposite its name on Schedule III or in the Assignment and Acceptance
pursuant to which it became a Lender Party, as the case may be, or such other
office of such Lender Party as such Lender Party may from time to time specify
in writing to the Borrower and the Agent.
"EBITDA" means, for any Person for any period, the Net Income
(Loss) of such Person for such period taken as a single accounting period, plus
(a) the sum of the following amounts of such Person and its Subsidiaries for
such period determined on a consolidated basis in accordance with GAAP to the
extent included in the determination of such Net Income (Loss): (i) depreciation
expense, (ii) amortization expense, (iii) Net Interest Expense, (iv) income tax
expense, (v) extraordinary losses and (vi) the amount of cash dividends or
distributions paid to such Person; less (b) the sum of the following amounts of
such Person and its Subsidiaries determined on a consolidated basis in
accordance with GAAP to the extent included in the determination of such Net
Income (Loss):
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(i) extraordinary gains, (ii) the Net Income (Loss) of any other Person that is
accounted for by the equity method of accounting and (iii) the Net Income (Loss)
of any other Person acquired by such Person or a Subsidiary of such Person in a
transaction accounted for as a pooling of interests for any period prior to the
date of such acquisition.
"Effective Date" means the first date that all of the
conditions contained in Article III are satisfied.
"Eligible Assignee" means (i) a commercial bank organized
under the laws of the United States of America, or any state thereof, and having
total assets in excess of $1,000,000,000; (ii) a commercial bank organized under
the laws of any other country which is a member of the Organization for Economic
Cooperation and Development ("OECD"), or a political subdivision of any such
country, and having total assets in excess of $3,000,000,000, provided that such
bank is acting though a branch or agency located in the country in which it is
organized or another country which is a member of the OECD; (iii) the central
bank of any country which is a member of the OECD; and (iv) any other financial
institution approved in writing by the Borrower and the Agent as an Eligible
Assignee for purposes of this Agreement; provided that the Borrower's approval
shall not be unreasonably withheld. Without limitation on the foregoing, the
Borrower may withhold its consent of any such other financial institution if the
proposed assignment of any portion of any Lender Party's rights and obligations
under this Agreement to such other financial institution would materially
increase the amount of Taxes required to be deducted by the Borrower from or in
respect of any sum payable under the Loan Documents (determined as of the date
on which such other financial institution is proposed to become a Lender Party
hereunder).
"Eligible Inventory" means such of the Inventory of the
Borrower and the Guarantors valued at the lower of market or cost on a first in
first out basis as the Agent, in its sole discretion consistent with its
customary business practices and generally applicable criteria for comparable
secured financings, deems eligible, less all reserves as the Agent, in its sole
discretion consistent with its customary business practices and generally
applicable criteria for comparable secured financings, from time to time deems
appropriate. For the purposes of this definition, the Agent does not intend to
treat the following Inventory as eligible: (a) Inventory in transit, (b)
Inventory held by a bailee or Inventory held on leased premises where the
landlord thereof has not executed a waiver and financing statement in form and
substance satisfactory to the Agent and (c) Inventory subject to a Lien prior in
right to that of the Lien in favor of the Secured Parties or subject to any
other Lien not permitted by Section 7.1. Nothing contained in the preceding
sentence shall limit the Agent's right, in its sole discretion consistent with
its customary business practices and generally applicable criteria for
comparable secured financings, to treat any item of Inventory as ineligible.
"Environmental Laws" means all federal, state and local laws,
statutes, ordinances and regulations, now or hereafter in effect, and in each
case as amended or supplemented from time to time, and any judicial or
administrative interpretation thereof, including, without limitation, any
judicial or administrative order, consent decree or judgment
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relating to the regulation and protection of human health, safety, the
environment or natural resources (including, without limitation, ambient air,
surface water, groundwater, wetlands, land surface or subsurface strata,
wildlife, aquatic species and vegetation).
"Environmental Liabilities and Costs" means, as to any Person,
all liabilities, obligations, responsibilities, Remedial Actions, losses,
damages, punitive damages, consequential damages, treble damages, costs and
expenses (including, without limitation, all fees, disbursements and expenses of
counsel, experts and consultants, and costs of investigation and feasibility
studies), fines, penalties, sanctions and interest incurred (either as an
expense or other charge or as would be included on the liabilities side of the
consolidated balance sheet of such Person and its Subsidiaries or, if the amount
and the liability is fixed, in a footnote thereto) or reserved against as a
result of any claim or demand by any other Person, whether based in contract,
tort, implied or express warranty, strict liability, criminal or civil statute,
including, without limitation, any thereof arising under any Environmental Law,
Permit, order or agreement with any Governmental Authority or other Person, and
which relate to any environmental, health or safety condition, or a Release or
threatened Release, and result from the past, present or future operations of
such Person or any of its Subsidiaries.
"Environmental Lien" means any Lien in favor of any
Governmental Authority for Environmental Liabilities and Costs.
"ERISA" means the Employee Retirement Income Security Act of
1974 (or any successor legislation thereto), as amended from time to time, and
the regulations promulgated and rulings issued thereunder.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with any Loan Party or any of its
Subsidiaries within the meaning of Section 414 (b), (c), (m) or (o) of the Code.
"ERISA Event" means (i) a Reportable Event with respect to a
Title IV Plan or a Multiemployer Plan; (ii) the withdrawal of any Loan Party or
any of its Subsidiaries or any ERISA Affiliate from a Title IV Plan subject to
Section 4063 of ERISA during a plan year in which it was a substantial employer,
as defined in Section 4001(a)(2) of ERISA; (iii) the complete or partial
withdrawal of any Loan Party or any of its Subsidiaries or any ERISA Affiliate
from any Multiemployer Plan; (iv) the filing of a notice of intent to terminate
a Title IV Plan or the treatment of a plan amendment as a termination under
Section 4041 of ERISA; (v) the institution of proceedings to terminate a Title
IV Plan or Multiemployer Plan by the PBGC; (vi) the failure to make required
contributions to a Qualified Plan; (vii) any other event or condition which
might reasonably be expected to constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any Title
IV Plan or Multiemployer Plan or the imposition of any liability under Title IV
of ERISA, other than PBGC premiums due but not delinquent under Section 4007 of
ERISA, excluding any such event or condition to the extent that the PBGC
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has, prior to the date hereof, (A) waived any such termination, appointment or
imposition as a result of such event or condition and each of the Loan Parties
and their respective Subsidiaries and each of the ERISA Affiliates are in
compliance with all applicable requirements of any such waiver or (B) consented
to the occurrence of such event or the existence of such condition in
circumstances that could not reasonably be expected to result in any liability
of any Loan Party or any of its Subsidiaries or any ERISA Affiliate after the
date hereof; (viii) a prohibited transaction (as described in Section 4975 of
the Code or Section 406 of ERISA) that occurs with respect to any Plan; or (ix)
the request by any Loan Party, any of its Subsidiaries or any ERISA Affiliate
for a minimum funding waiver from the IRS with respect to any Pension Plan.
"Eurocurrency Liabilities" has the meaning assigned to that
term in Regulation D of the Board of Governors of the Federal Reserve System, as
in effect from time to time.
"Eurodollar Lending Office" means, with respect to any Lender
Party, the office of such Lender specified as its "Eurodollar Lending Office"
below its name on Schedule III or in the Assignment and Acceptance pursuant to
which it became a Lender Party, as the case may be (or, if no such office is
specified, its Domestic Lending Office), or such other office of such Lender
Party as such Lender Party may from time to time specify in writing to the
Borrower and the Agent.
"Eurodollar Rate" means, for any Interest Period, an interest
rate per annum equal to the rate per annum obtained by dividing (a) the rate of
interest determined by the Agent to be the average (rounded upward to the
nearest whole multiple of 1/16 of 1% per annum, if such average is not such a
multiple) of the rate per annum at which deposits in Dollars are offered by the
principal office of Citibank in London, England to prime banks in the London
interbank market at 11:00 A.M. (London time) two Business Days before the first
day for such Interest Period in an amount substantially equal to the Eurodollar
Rate Loan of Citicorp during such Interest Period and for a period equal to such
Interest Period by (b) a percentage equal to 100% minus the Eurodollar Rate
Reserve Percentage for such Interest Period.
"Eurodollar Rate Loan" means any outstanding principal amount
of the Loans of any Lender Party that, for an Interest Period, bears interest at
a rate determined with reference to the Eurodollar Rate.
"Eurodollar Rate Reserve Percentage" for any Interest Period
means the reserve percentage applicable two Business Days before the first day
of such Interest Period under regulations issued from time to time by the Board
of Governors of the Federal Reserve System (or any successor) for determining
the maximum reserve requirement (including, without limitation, any emergency,
supplemental or other marginal reserve requirement) for a member bank of the
Federal Reserve System in New York City with respect to liabilities or assets
consisting of or including Eurocurrency Liabilities (or with respect to any
other
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category of liabilities which includes deposits by reference to which the
Eurodollar Rate is determined) having a term equal to such Interest Period.
"Event of Default" has the meaning specified in Section 8.1.
"Fabricating Joint Ventures" means, collectively, the joint
ventures, corporations or partnerships owned by Holdings, the Borrower or any
Guarantor (or a wholly owned Subsidiary of Holdings, the Borrower or any
Guarantor ) to make acquisitions of businesses whose primary operations are
fabricating, coating and other processing of steel products.
"Fair Market Value" means (i) with respect to any asset (other
than a marketable security) at any date, the value of the consideration
obtainable in a sale of such asset at such date assuming a sale by a willing
seller to a willing purchaser dealing at arm's length and arranged in an orderly
manner over a reasonable period of time having regard to the nature and
characteristics of such asset or, if such asset shall have been the subject of a
relatively contemporaneous appraisal by an independent third party appraiser,
the basic assumptions underlying which have not materially changed since its
date, as set forth in such appraisal, and (ii) with respect to any marketable
security at any date, the closing sale price of such security on the business
day (on which any national securities exchange is open for the normal
transaction of business) next preceding such date, as appearing in any published
list of any national securities exchange or in the National Market List of the
National Association of Securities Dealers, Inc. or, if there is no such closing
sale price of such security, the average of the asked and bid prices for the
purchase of such security at face value quoted on such business day by a
financial institution of recognized standing which regularly deals in securities
of such type.
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by the Agent from three Federal funds brokers of
recognized standing selected by it.
"First Mortgage Indenture" means, the indenture, dated as of
November 15, 1991, between Holdings and Chemical Bank, as trustee, pursuant to
which the First Mortgage Notes have been issued, as the same may be amended,
supplemented or modified from time to time.
"First Mortgage Notes" means Holdings' 12 1/4% First Mortgage
Notes due 2000 issued pursuant to the First Mortgage Indenture, as amended prior
to the Effective Date.
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"Fiscal Quarter" means the three month period ending on March
31, June 30, September 30 or December 31.
"Fiscal Year" means the 12 month period ending on December 31.
"Funding" means Wheeling-Pittsburgh Funding, Inc., a Delaware
special purpose corporation and wholly owned Subsidiary of the Borrower.
"GAAP" means generally accepted accounting principles in the
United States of America as in effect from time to time as set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and the statements and pronouncements
of the Financial Accounting Standards Board, which are applicable to the
circumstances as of the date of determination except that, for purposes of
Article V, GAAP shall be determined on the basis of such principles in effect on
the date hereof and consistent with those used in the preparation of the audited
financial statements referred to in Section 4.5.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Guarantor" means any of PCC, Wheeling Construction or
Unimast, and such other permitted Subsidiaries of the Borrower or any other
Guarantor that may become a party to the Guaranty in the future, as required by
the Agent in accordance with Section 7.13.
"Guarantor Intercompany Notes" means intercompany notes made
by the Guarantors in favor of the Borrower in substantially the form of Exhibit
P.
"Guarantor Security Agreement" means the security agreement,
executed by each of the Guarantors, substantially in the form of Exhibit L, as
such Agreement may be amended, supplemented or otherwise modified from time to
time.
"Guaranty" means the guaranty executed by each of the
Guarantors, substantially in the form of Exhibit K, as such guaranty may be
amended, supplemented or otherwise modified from time to time.
"Holdings" has the meaning specified in the Preliminary
Statements.
"Holdings Guaranty" means the guaranty executed by Holdings,
substantially in the form of Exhibit I, as such guaranty may be amended,
supplemented or otherwise modified from time to time.
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"Holdings Intercreditor Agreement" means the amended and
restated intercreditor agreement executed by WHX, Holdings, the Borrower and the
Agent, in substantially the form of Exhibit N as such agreement may be amended,
supplemented or otherwise modified from time to time.
"Holdings IPO" means the initial public offering of Stock of
Holdings.
"Holdings IPO Threshold" means that not less than 50% of the
issued and outstanding Stock of Holdings shall have been sold to Persons other
than WHX and its Affiliates pursuant to the Holdings IPO.
"Holdings Note" means those certain notes, each dated as of
October 24, 1994, of the Borrower in favor of Holdings in the aggregate
principal amount of $287,387,926 (as of November 30, 1995).
"Holdings Pledge Agreement" means the pledge agreement
executed by Holdings, substantially in the form of Exhibit J, as such pledge
agreement may be amended, supplemented or otherwise modified from time to time.
"Indebtedness" of any Person means (i) all indebtedness of
such Person for borrowed money (including, without limitation, reimbursement and
all other obligations with respect to surety bonds, letters of credit and
bankers' acceptances, whether or not matured) or for the deferred purchase price
of property or services, (ii) all obligations of such Person evidenced by notes,
bonds, debentures or similar instruments, (iii) all indebtedness of such Person
created or arising under any conditional sale or other title retention agreement
with respect to property acquired by such Person (even though the rights and
remedies of the seller or lender under such agreement in the event of default
are limited to repossession or sale of such property), (iv) all Capitalized
Lease Obligations of such Person, (v) all Contingent Obligations of such Person,
(vi) all obligations of such Person to purchase, redeem, retire, defease or
otherwise acquire for value any Stock or Stock Equivalent of such Person,
valued, in the case of redeemable preferred stock, at the greater of its
voluntary or involuntary liquidation preference plus accrued and unpaid
dividends, (vii) all obligations of such Person under any interest rate
contract, (viii) all Indebtedness referred to in clause (i), (ii), (iii), (iv),
(v), (vi) or (vii) above secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien upon or in property (including, without limitation, Accounts and
general intangibles) owned by such Person, even though such Person has not
assumed or become liable for the payment of such Indebtedness, and (ix) in the
case of the Borrower, the Obligations.
"Indemnitee" has the meaning specified in Section 10.4.
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"Indentures" means, collectively, (i) the Permanent Financing
Indenture and (ii) the First Mortgage Indenture.
"Interest Coverage Ratio" means, for each Fiscal Quarter and
determined on the basis of the four Fiscal Quarters ending on the date of
determination, a ratio of (a) Adjusted EBITDA of the Loan Party Consolidated
Group plus any noncash net periodic pension costs (to the extent not added back
to Net Income (Loss) in the calculation of EBITDA) of the Loan Party
Consolidated Group for such period to (b) Cash Interest Expense of the Loan
Party Consolidated Group plus the aggregate "Discount Amount" (under and as
defined in each Supplement included in the Securitization Documents) for such
period.
"Interest Period" means (a) initially, the period commencing
on the date a Eurodollar Rate Loan is made or on the date of conversion of a
Base Rate Loan to a Eurodollar Rate Loan and ending three months thereafter and
(b) thereafter, if such Loan is continued, in whole or in part, as a Eurodollar
Rate Loan pursuant to Section 2.9, the period commencing on the last day of the
immediately preceding Interest Period therefor and ending three months
thereafter; provided, however, that:
(A) if any Interest Period would otherwise end on a day which
is not a Business Day, such Interest Period shall be extended to the
next succeeding Business Day, unless the result of such extension would
be to extend such Interest Period into another calendar month, in which
event such Interest Period shall end on the immediately preceding
Business Day;
(B) any Interest Period that begins on the last Business Day
of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of a calendar month;
(C) the Borrower may not select any Interest Period which ends
after the Termination Date;
(D) the Borrower may not select any Interest Period in respect
of Loans having an aggregate principal amount of less than $5,000,000;
and
(E) there shall be outstanding at any one time no more than
seven Interest Periods in the aggregate.
"Interest Rate Contract" means interest rate swap, cap or
collar agreements and interest rate future or option contracts and similar
agreements.
"Inventory" has the meaning specified in the Borrower Security
Agreement.
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"Investment" has the meaning specified in Section 7.6.
"IRS" means the Internal Revenue Service, or any successor
thereto.
"ISPAT" has the meaning specified in Section 7.5(a).
"Issuer" means each Person listed on Schedule I.
"Keepwell Agreement" means the amended and restated agreement,
executed by each of WHX, Holdings and the Borrower, substantially in the form of
Exhibit M, as such agreement may be amended, supplemented or otherwise modified
from time to time.
"Keepwell Payments" has the meaning specified in the Keepwell
Agreement.
"L/C Cash Collateral Account" has the meaning specified in
Section 8.3.
"Leases" means, with respect to the Borrower, any Guarantor or
any of their Subsidiaries, all of those leasehold estates in real property now
owned as lessee or hereafter acquired including, without limitation, those
listed on Schedule 4.21(b), as such may be amended, supplemented or otherwise
modified from time to time to the extent permitted by this Agreement.
"Lender Party" means any Lender, any Issuer or the Swing Bank.
"Letter of Credit" means any letter of credit issued for the
account of the Borrower or any of its Subsidiaries by an Issuer pursuant to
Section 2.17.
"Letter of Credit Agreement" means the agreement, dated as of
August 24, 1994, among the Borrower and Citibank, as issuer, as such agreement
may be amended, supplemented or otherwise modified from time to time.
"Letter of Credit Obligations" means, at any time, all
liabilities at such time of the Borrower to all Issuers with respect to Letters
of Credit, whether or not any such liability is contingent, and includes the sum
of (i) the Reimbursement Obligations at such time and (ii) the Letter of Credit
Undrawn Amounts at such time.
"Letter of Credit Reimbursement Agreement" has the meaning
specified in Section 2.17(c).
"Letter of Credit Request" has the meaning specified in
Section 2.17(d).
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"Letter of Credit Undrawn Amounts" means, at any time, the
aggregate undrawn face amount of all Letters of Credit outstanding at such time.
"Lien" means any mortgage, deed of trust, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
other), security interest or other similar kind of preference, priority or
security agreement or preferential arrangement, including, without limitation,
any conditional sale or other title retention agreement, the interest of a
lessor under a Capitalized Lease Obligation, any financing lease having
substantially the same economic effect as any of the foregoing, and the filing,
under the UCC or comparable law of any jurisdiction, of any financing statement
naming the owner of the asset to which such Lien relates as debtor (other than a
filing which does not evidence an outstanding secured obligation, a commitment
to make advances, incur obligations or otherwise give value).
"Loan" means a Revolving Credit Loan or a Swing Loan made by a
Lender to the Borrower pursuant to Article II.
"Loan Documents" means, collectively, this Agreement, the
Revolving Credit Notes, the Keepwell Agreement, each Letter of Credit
Reimbursement Agreement, the Holdings Intercreditor Agreement, the Guarantor
Intercompany Notes, the Borrower Intercompany Notes and the Collateral
Documents.
"Loan Party" means each of the Borrower, each Guarantor,
Holdings and each Subsidiary or Affiliate of the Borrower (other than WHX) which
executes and delivers a Loan Document.
"Loan Party Consolidated Group" means each Loan Party and its
Subsidiaries.
"Majority Lenders" means, at any time, Lenders holding at
least 51% of the aggregate of the Revolving Credit Commitments at such time.
"Material Adverse Change" means a material adverse change in
any of (i) the condition (financial or otherwise), business, performance,
prospects, operations or properties of Holdings, the Borrower, the Guarantors
and their respective Subsidiaries taken as one enterprise, (ii) the legality,
validity or enforceability of any Loan Document, (iii) the perfection or
priority of the Liens granted pursuant to the Collateral Documents, other than
solely by reason of action by the Agent or the Lender Parties, (iv) the ability
of the Borrower to repay the Obligations or of any Loan Party to perform its
obligations under any Loan Document in any material respects or (v) the rights
and remedies of the Lender Parties or the Agent under the Loan Documents;
provided that any such change related to matters described in Section 4.16(a),
(b), (e), (f) and (g) shall not constitute a Material Adverse Change at any time
that the excess of (i) the lesser of the Revolving Credit Commitments and
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the Borrowing Base over (ii) (A) the sum of the aggregate principal amount of
Revolving Credit Loans, Letter of Credit Obligations and Swing Loans then
outstanding minus (B) the aggregate amount then on deposit in the Cash
Collateral Account and the Letter of Credit Cash Collateral Account, is equal to
or greater than $50,000,000.
"Material Adverse Effect" means an effect that has a
reasonable likelihood of resulting in or causing a material adverse change in
any of (i) the condition (financial or otherwise), business, performance,
prospects, operations or properties of Holdings, the Borrower, the Guarantor and
their respective Subsidiaries taken as one enterprise, (ii) the legality,
validity or enforceability of any Loan Document, (iii) the perfection or
priority of the Liens granted pursuant to the Collateral Documents, other than
solely by reason of action by the Agent or the Lender Parties, (iv) the ability
of the Borrower to repay the Obligations or of any Loan Party to perform its
obligations under any Loan Document in any material respects or (v) the rights
and remedies of the Lender Parties or the Agent under the Loan Documents;
provided that any such effect related to matters described in Section 4.16(a),
(b), (e), (f) and (g) shall not constitute a Material Adverse Effect at any time
that the excess of (i) the lesser of the Revolving Credit Commitments and the
Borrowing Base over (ii) (A) the sum of the aggregate principal amount of
Revolving Credit Loans, Letter of Credit Obligations and Swing Loans then
outstanding minus (B) the aggregate amount then on deposit in the Cash
Collateral Account and the Letter of Credit Cash Collateral Account, is equal to
or greater than $50,000,000.
"Material Contractual Obligation" of any Person means such
Person's Contractual Obligations in respect of Indebtedness of the types
described in clauses (i) and (ii) of the definition of "Indebtedness" and each
other Contractual Obligation that is material to the business, prospects,
operations or financial condition of such Person.
"Multiemployer Plan" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, and to which the Borrower, any of its Subsidiaries
or any ERISA Affiliate is making, is obligated to make, has made or been
obligated to make, contributions on behalf of participants who are or were
employed by any of them.
"Net Income (Loss)" means, for any Person for any period, the
aggregate net income (or loss) from continuing operations of such Person and its
Subsidiaries for such period, determined on a consolidated basis in accordance
with GAAP.
"Net Interest Expense" means, for any Person for any period,
(i) gross interest expense of such Person and its Subsidiaries for such period
determined on a consolidated basis in accordance with GAAP, less (ii) the
following for such Person and its Subsidiaries determined on a consolidated
basis determined in accordance with
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GAAP: the sum of (1) interest capitalized during construction for such period,
(2) interest income for such period, and (3) gains for such period on Interest
Rate Contracts (to the extent not included in interest income above and to the
extent not deducted in the calculation of such gross interest expense), plus
(iii) the following for such Person and its Subsidiaries determined on a
consolidated basis in accordance with GAAP: the sum of (1) losses for such
period on Interest Rate Contracts (to the extent not included in gross interest
expense), (2) upfront costs or fees for such period associated with Interest
Rate Contracts (to the extent not included in gross interest expense) and (3)
the aggregate "Discount Amount" (under and as defined in each Supplement
included in the Securitization Documents) for such period.
"Net Worth" of any Person means, at any date, the excess of
the Total Assets of such Person at such date over the Total Liabilities of such
Person at such date.
"1994 Credit Agreement" has the meaning specified in the
recitals hereto.
"Non-Cash Interest Expense" means, for any Person for any
period, the sum of the following amounts to the extent included in Net Interest
Expense of such Person for such period: (i) the amount of amortized debt
discount and (ii) charges relating to write-ups or write-downs in the book or
carrying value of existing Indebtedness.
"Notice of Borrowing" has the meaning specified in Section
2.3(a).
"Notice of Continuation or Conversion" has the meaning
specified in Section 2.8.
"Obligations" means the Loans, the Letter of Credit
Obligations and, all other advances, debts, liabilities, obligations, covenants
and duties owing by the Borrower to the Agent, any Lender Party, any Affiliate
of any of them or any Indemnitee, of every type and description, present or
future, whether or not evidenced by any note, guaranty or other instrument,
arising under this Agreement, under any other Loan Document or under any
agreement of the type described in clause (iv) of the definition of Cash
Equivalents, whether or not for the payment of money, whether arising by reason
of an extension of credit, opening or amendment of a Letter of Credit or payment
of any draft drawn thereunder, loan, guaranty, indemnification, foreign exchange
transaction, interest rate contract, commodity contract or in any other manner,
whether direct or indirect (including, without limitation, those acquired by
assignment), absolute or contingent, due or to become due, now existing or
hereafter arising and however acquired. The term "Obligations" includes, without
limitation, all interest, charges, expenses, fees, attorneys' fees and
disbursements and
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any other sum chargeable to the Borrower under this Agreement or any other Loan
Document.
"Other Taxes" has the meaning specified in Section 2.15(b).
"PBGC" means the Pension Benefit Guaranty Corporation, or any
successor thereto.
"PCC" means Pittsburgh-Xxxxxxxx Corporation, a Pennsylvania
corporation wholly owned by Holdings.
"Pension Plan" means an employee pension benefit plan, as
defined in Section 3(2) of ERISA, which is not an individual account plan, as
defined in Section 3(34) of ERISA, and which the Borrower or any of its
Subsidiaries or, if a Title IV Plan, any ERISA Affiliate maintains, contributes
to or has an obligation to contribute to on behalf of participants who are or
were employed by any of them.
"Performance Level" means, as of any date, the level set forth
below then in effect, as determined in accordance with the following provisions
of this definition:
Performance Level Interest Coverage Ratio
I Greater than 5.25:1.00
II Less than or equal to 5.25:1.00 but
greater than 4.75:1.00
III Less than or equal to 4.75:1.00 but
greater than 3.75:1.00
IV Less than or equal to 3.75:1.00 but
greater than 2.75:1.00
V Less than or equal to 2.75:1.00
For the purposes of this definition, the Performance Level shall be determined
by reference to the financial statements delivered pursuant to Sections 6.10(b)
or (c); changes in the Performance Level shall become effective on the first day
of the month next succeeding the date on which such financial statements are
delivered to the Lender Parties and shall remain in effect until the next change
to be effected pursuant to this definition.
"Permanent Financing Indenture" means the indenture, dated as
of November 15, 1993, between Holdings and Bank One, Columbus, N.A., as trustee,
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pursuant to which the Permanent Financing Notes were issued, as the same may be
amended, modified or supplemented from time to time.
"Permanent Financing Notes" means Holdings' 9 3/8% Senior
Notes due 2003 issued pursuant to the Permanent Financing Indenture.
"Permit" means any permit, approval, authorization, license,
variance or permission required from a Governmental Authority under an
applicable Requirement of Law.
"Permitted Liens" means Liens permitted by Section 7.1(a),
(d), (e) and, to the extent that any Lien described in Section 7.1(f) secures
Indebtedness referred to in clause (e) of such Section 7.1, Section 7.1(f).
"Person" means an individual, partnership, corporation
(including, without limitation, a business trust), limited liability company,
joint stock company, trust, unincorporated association, joint venture or other
entity, or a Governmental Authority.
"Plan" means an employee benefit plan, as defined in Section
3(3) of ERISA, which the Borrower or any of its Subsidiaries maintains,
contributes to or has an obligation to contribute to on behalf of participants
who are or were employed by any of them.
"Projections" means those financial projections dated October
24, 1995, covering the fourth Fiscal Quarter of 1995 and the Fiscal Years ending
in 1996, 1997, 1998, 1999 and 2000, delivered to the Lender Parties by the
Borrower.
"Qualified Plan" means an employee pension benefit plan, as
defined in Section 3(2) of ERISA, which is intended to be tax-qualified under
Section 401(a) of the Code, and which the Borrower, any of its Subsidiaries or
any ERISA Affiliate maintains, contributes to or has an obligation to contribute
to on behalf of participants who are or were employed by any of them.
"Ratable Portion" or ratably means, with respect to any Lender
Party, the following: (i) in the case of principal and interest, the quotient
obtained by dividing the aggregate principal amount of all Loans held by such
Lender Party by the aggregate principal amount of all Loans held by all Lender
Parties and (ii) in all other cases, the quotient obtained by dividing the
principal amount of the Revolving Credit Commitment of such Lender by the
aggregate principal amount of all Revolving Credit Commitments of all Lenders.
"Real Estate" means all of those plots, pieces or parcels of
land now owned or hereafter acquired by the Borrower, any Guarantor or any of
their
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Subsidiaries (the "Land"), including, without limitation, those listed on
Schedule 4.21(a), together with the right, title and interest of the Borrower,
such Guarantor or such Subsidiary, if any, in and to the streets, the land lying
in the bed of any streets, roads or avenues, opened or proposed, in front of,
adjoining or abutting the Land to the center line thereof, the air space and
development rights pertaining to the Land and the right to use such air space
and development rights, all rights of way, privileges, liberties, tenements,
hereditaments and appurtenances belonging or in any way appertaining thereto,
all fixtures, all easements now or hereafter benefiting the Land and all
royalties and rights appertaining to the use and enjoyment of the Land,
including, without limitation, all alley, vault, drainage, mineral, water, oil
and gas rights, together with all of the buildings and other improvements now or
hereafter erected on the Land, and any fixtures appurtenant thereto.
"Receivables Securitization" means the program pursuant to
which the Borrower sells, transfers or otherwise conveys certain of its accounts
receivables, together with the accounts receivables of the Guarantors and
certain other Affiliates of the Borrower from time to time, to Funding for
inclusion in Funding's receivables securitization program.
"Register" has the meaning specified in Section 10.7.
"Reimbursement Obligations" means all reimbursement or
repayment obligations of the Borrower to Issuers with respect to Letters of
Credit pursuant to Letter of Credit Reimbursement Agreements.
"Release" means, as to any Person, any release, spill,
emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal,
leaching or migration into the indoor or outdoor environment or into or out of
any property owned by such Person, including, without limitation, the movement
of Contaminants through or in the air, soil, surface water, ground water or
property.
"Remedial Action" means all actions required to (i) clean up,
remove, treat or in any other way address Contaminants in the indoor or outdoor
environment, (ii) prevent the Release or threat of Release or minimize the
further Release of Contaminants so they do not migrate or endanger or threaten
to endanger public health or welfare or the indoor or outdoor environment, or
(iii) perform pre-remedial studies and investigations and post-remedial
monitoring and care.
"Reportable Event" means any event described in Section
4043(c) of ERISA.
"Requirement of Law" means, as to any Person, the certificate
of incorporation and by-laws or other organizational or governing documents of
such Person, and all federal, state and local laws, rules and regulations,
including, without
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limitation, federal, state or local securities laws, ERISA and Environmental
Laws, and the disclosure requirements thereof and all orders, judgments, decrees
or other determinations of any Governmental Authority or arbitrator, applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
"Responsible Officer" means, with respect to any Person, any
of the principal executive officers of such Person.
"Revolving Credit Borrowing" means a borrowing consisting of
Revolving Credit Loans made on the same day by the Lenders ratably according to
their respective Revolving Credit Commitments.
"Revolving Credit Commitment" means, as to each Lender, the
commitment of such Lender to make Revolving Credit Loans to the Borrower
pursuant to Section 2.1 in the aggregate principal amount outstanding not to
exceed the amount set forth opposite such Lender's name on Schedule II under the
caption "Revolving Credit Commitment" or, if such Lender has entered into one or
more Assignments and Acceptances, set forth in the Register maintained by the
Agent pursuant to Section 10.7 as such Lender's "Revolving Credit Commitment",
as such amount may be reduced or modified pursuant to this Agreement.
"Revolving Credit Loan" means a Loan made by a Lender to the
Borrower pursuant to Section 2.1.
"Revolving Credit Note" means a promissory note of the
Borrower payable to the order of any Lender in a principal amount equal to the
amount of such Lender's Revolving Credit Commitment as originally in effect, in
substantially the form of Exhibit A, evidencing the aggregate Indebtedness of
the Borrower to such Lender resulting from the Revolving Credit Loans made by
such Lender.
"Secured Parties" means the Lender Parties and the Agent.
"Securitization Documents" means each agreement, document and
instrument entered into by the Borrower, any Guarantor or Funding in connection
with the Receivables Securitization, including without limitation, the
Receivables Purchase Agreement executed by the Borrower and Funding and the
subordinated promissory note of Funding in favor of the Borrower made in
connection therewith.
"Settlement Date" has the meaning assigned to it in Section
2.18.
"Solvent" means, with respect to any Person, that the value of
the assets of such Person (both at fair value and present fair saleable value)
is, on the date of determination, greater than the total amount of liabilities
(including, without
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limitation, contingent and unliquidated liabilities) of such Person as of such
date and that, as of such date, such Person is able to pay all liabilities of
such Person as such liabilities mature and does not have unreasonably small
capital. In computing the amount of contingent or unliquidated liabilities at
any time, such liabilities will be computed at the amount which, in light of all
the facts and circumstances existing at such time, represents the amount that
can reasonably be expected to become an actual or matured liability.
"Stock" means shares of capital stock, beneficial or
partnership interests, participations or other equivalents (regardless of how
designated) of or in a corporation or equivalent entity, whether voting or
non-voting, and includes, without limitation, common stock and preferred stock.
"Stock Equivalents" means all securities convertible into or
exchangeable for Stock and all warrants, options or other rights to purchase or
subscribe for any Stock, whether or not presently convertible, exchangeable or
exercisable.
"Subsidiary" means, with respect to any Person, any
corporation, partnership, limited liability company, or other business entity of
which an aggregate of more than 50% of the outstanding Stock having ordinary
voting power to elect a majority of the board of directors, managers, trustees
or other controlling persons, is, at the time, directly or indirectly, owned by
such Person and/or one or more Subsidiaries of such Person (irrespective of
whether, at the time, Stock of any other class or classes of such entity shall
have or might have voting power by reason of the happening of any contingency).
"Swing Bank" means Citicorp or such other Lender who shall
also be the Agent or who shall agree with the Agent to act as Swing Bank.
"Swing Loan" means a Loan made by the Swing Bank to the
Borrower pursuant to Section 2.2.
"Swing Loan Available Credit" means the Swing Bank's Ratable
Portion of the Available Credit.
"Swing Loan Borrowing" means a Borrowing consisting of a Swing
Loan.
"Tangible Net Worth" of any Person means, at any date, the Net
Worth of such Person at such date, excluding (i) any noncash effects of adopting
the accounting principles described in FAS No. 87, FAS No. 88 and any subsequent
FAS promulgated by the Financial Accounting Standards Board addressing pensions,
(ii) all
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unamortized financing costs or unamortized debt discount and expense and (iii)
all intangibles and deferred charges other than for taxes, pensions and cash
escrow.
"Tax Affiliate" means, as to any Person, (i) any Subsidiary of
such Person, and (ii) any Affiliate of such Person with which such Person filed,
files or is eligible to file consolidated, combined or unitary tax returns.
"Tax Return" has the meaning specified in Section 4.3.
"Tax Sharing Agreement" means the agreement, dated as of April
12, 1991, between the Borrower and Holdings, as modified by the Contribution and
Assumption Agreement, dated as of July 26, 1994, between WHX and Holdings, as
such agreement may be further amended, supplemented or otherwise modified from
time to time.
"Taxes" has the meaning specified in Section 2.15(a).
"Termination Date" means the earlier of (i) May 3, 1999 and
(ii) the date of termination in whole of the Revolving Credit Commitments
pursuant to Section 2.5 or 8.2.
"Title IV Plan" means a Pension Plan, other than a
Multiemployer Plan, which is covered by Title IV of ERISA.
"Total Assets" of any Person means, at any date, the total
assets of such Person and its Subsidiaries at such date, determined on a
consolidated basis in accordance with GAAP.
"Total Liabilities" of any Person means, at any date, all
obligations which in accordance with GAAP would be included in determining total
liabilities as shown on the liabilities side of a consolidated balance sheet of
such Person and its Subsidiaries at such date.
"Triggering Condition" means the occurrence of any of the
following: (i) the aggregate outstanding principal amount of the Swing Loans and
Revolving Credit Loans and the outstanding Letter of Credit Obligations exceeds
$50,000,000 for a period of five consecutive Business Days, (ii) the aggregate
outstanding principal amount of the Swing Loans and Revolving Credit Loans and
the outstanding Letter of Credit Obligations exceeds $70,000,000 on any Business
Day and (iii) there has occurred any Default or Event of Default.
"Triggering Condition Unwind" means the aggregate outstanding
principal amount of the Swing Loans and Revolving Credit Loans and outstanding
Letter of Credit Obligations is less than or equal to $25,000,000 for a period
of ten
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consecutive Business Days and no Default or Event of Default has occurred and is
continuing.
"UCC" shall have the meaning assigned to it in the Borrower
Security Agreement.
"Unfunded Pension Liability" means, as to the Borrower at any
time, the aggregate amount, if any, of the sum of (i) the amount by which the
present value of all accrued benefits under each Title IV Plan exceeds the fair
market value of all assets of such Title IV Plan allocable to such benefits in
accordance with Title IV of ERISA, all determined as of the most recent
valuation date for each such Title IV Plan using the actuarial assumptions in
effect under such Title IV Plan, and (ii) for a period of five years following a
transaction reasonably likely to be covered by Section 4069 of ERISA, the
liabilities (whether or not accrued) that could be avoided by the Borrower, the
Borrower's Subsidiaries and all ERISA Affiliates as a result of such
transaction.
"Unimast" means Unimast Incorporated, an Ohio corporation
wholly owned on the Effective Date by WHX.
"USWA Right of First Refusal" shall mean the right of first
refusal granted by Holdings and the Borrower pursuant to an agreement, dated as
of December 19, 1990, between Holdings, the Borrower and the United Steelworkers
of America, AFL-CIO-CLC and any agreements ancillary thereto or amendments,
renewals or modifications thereof.
"Welfare Benefit Plan" means an employee welfare benefit plan,
as defined in Section 3(1) of ERISA, which the Borrower or any of its
Subsidiaries maintains, contributes to, has contributed to within the six year
period preceding the Effective Date or has an obligation to contribute to on
behalf of their respective former or active employees (or their beneficiaries).
"Wheeling Construction" means Wheeling Construction Products,
Inc., a Delaware corporation wholly owned by Holdings.
"Wheeling-Nisshin" means Wheeling-Nisshin, Inc., a Delaware
corporation, all the outstanding Stock and Stock Equivalents of which is owned
by Holdings and Nisshin Steel Co., Ltd.
"WHX" has the meaning specified in the Preliminary Statements.
"Withdrawal Liability" means, as to the Borrower, at any time,
the aggregate amount of the liabilities of the Borrower, the Borrower's
Subsidiaries or any ERISA Affiliate pursuant to Section 4201 of ERISA, and any
increase in
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contributions required to be made pursuant to Section 4243 of ERISA, with
respect to all Multiemployer Plans.
1.2. Computation of Time Periods. In this Agreement, in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
mean "to but excluding" and the word "through" means "to and including".
1.3. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP and all accounting
determinations required to be made pursuant hereto shall, unless expressly
otherwise provided herein, be made in accordance with GAAP.
1.4. Certain Terms. (a) The words "herein," "hereof" and
"hereunder" and other words of similar import refer to this Agreement as a
whole, and not to any particular Article, Section, subsection or clause in this
Agreement. References herein to an Exhibit, Schedule, Article, Section,
subsection or clause refer to the appropriate Exhibit or Schedule to, or
Article, Section, subsection or clause in this Agreement.
(b) The terms "Lender", "Issuer" and "Agent" include their
respective successors and the term "Lender" includes each assignee of such
Lender who becomes a party hereto pursuant to Section 10.7.
ARTICLE II
AMOUNTS AND TERMS OF THE LOANS
2.1. The Revolving Credit Loans. On the terms and subject to
the conditions contained in this Agreement, each Lender severally agrees to make
Revolving Credit Loans to the Borrower from time to time on any Business Day
during the period from the Effective Date until the Termination Date in an
aggregate amount not to exceed at any time outstanding such Lender's Revolving
Credit Commitment; provided, however, that at no time, except as provided for in
Section 2.14(c), shall any Lender be obligated to make a Revolving Credit Loan
in excess of such Lender's Ratable Portion of the Available Credit. In addition,
each Lender agrees to make Revolving Credit Loans in accordance with Section
2.18. Within the limits of each Lender's Revolving Credit Commitment, amounts
prepaid pursuant to Section 2.7(c) may be reborrowed under this Section 2.1. The
Revolving Credit Loans of each Lender shall be evidenced by a Revolving Credit
Note to the order of such Lender.
2.2. The Swing Loans. The Swing Bank, in its sole discretion,
on the terms and subject to the conditions contained in this Agreement, may make
loans
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(each a "Swing Loan") to the Borrower from time to time on any Business Day
during the period from the date hereof until the Termination Date in an
aggregate amount not to exceed at any time outstanding, except pursuant to
Section 2.14(c), the lesser of (a) the Swing Loan Available Credit or (b) the
excess of the Swing Bank's Revolving Credit Commitment over the sum of the
aggregate outstanding principal amount of the Swing Loans and Revolving Credit
Loans made by it and the Swing Bank's Ratable Portion of the outstanding Letter
of Credit Obligations. The Swing Bank shall be entitled to rely on the most
recent Borrowing Base Certificate delivered to the Agent.
2.3. Making the Loans. (a) Except as provided for in Sections
2.4(a), 2.9(b), 2.17(h) and 2.18, each Revolving Credit Borrowing shall be made
on notice, given by the Borrower to the Agent (x) in the case of a Revolving
Credit Borrowing requested to refinance a Swing Loan, not later than 12:00 P.M.
(New York City time) on one Business Day prior to the date of the proposed
Revolving Credit Borrowing and (y) in the case of a Revolving Credit Borrowing
requested as a direct advance to the Borrower, not later than 11:00 A.M. (New
York City time) on the date of the proposed Revolving Credit Borrowing. Each
such notice shall be executed by an officer of the Borrower indicated on
Schedule 2.3 or such other persons as agreed to, in writing, by the Agent (a
"Notice of Borrowing"), which notice shall be in substantially the form of
Exhibit B, specifying therein (i) the date of such proposed Borrowing, (ii) the
aggregate amount of such proposed Borrowing and (iii) a statement that the
proposed Borrowing does not exceed the Available Credit. The Revolving Credit
Loans shall be made as Base Rate Loans.
(b) Each Swing Loan Borrowing shall be made on notice, given
by the Borrower to the Swing Bank not later than 12:00 P.M. (New York City time)
on the Business Day of the proposed Swing Loan Borrowing. All Swing Loans shall
be made as Base Rate Loans.
(c) The Agent shall give to each Lender prompt notice of the
Agent's receipt of a Notice of Borrowing. Each Lender shall, (x) in the case of
a Revolving Credit Borrowing requested to refinance a Swing Loan, before 12:00
P.M. (New York City time) and (y) in the case of a Revolving Credit Loan
requested as a direct advance to the Borrower, before 2:00 P.M. (New York City
time), in each case on the date of the proposed Borrowing, make available for
the account of its Applicable Lending Office to the Agent's Account, in
immediately available funds, such Lender's Ratable Portion of such proposed
Revolving Credit Borrowing. After the Agent's receipt of such funds and upon
fulfillment of the applicable conditions set forth in Article III, the Agent
will promptly make such funds available to the Borrower at the Agent's aforesaid
address. In determining whether such applicable conditions have been satisfied,
the Agent shall be entitled to rely on the most recent Borrowing Base
Certificate received from the Borrower.
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(d) Each Revolving Credit Borrowing shall be in an aggregate
amount of not less than $100,000. Each Swing Loan shall be in the amount of not
less than $100,000 unless a lower amount is permitted by the Swing Bank in its
sole discretion from time to time.
(e) Each Notice of Borrowing shall be irrevocable and binding
on the Borrower.
(f) Unless the Agent shall have received notice from a Lender
prior to the date of any proposed Revolving Credit Borrowing that such Lender
will not make available to the Agent such Lender's Ratable Portion of such
Revolving Credit Borrowing, the Agent may assume that such Lender has made such
Ratable Portion of the proposed Revolving Credit Borrowing available to the
Agent on the date of such Borrowing in accordance with this Section 2.3 and the
Agent may, in reliance upon such assumption, make available to the Borrower on
such date a corresponding amount. If and to the extent that such Lender shall
not have so made such portion available to the Agent, such Lender and the
Borrower severally agree to repay to the Agent forthwith on the next Business
Day following the day on which the Lender does not make such portion available
such corresponding amount together with interest thereon, for each day from the
date such amount is made available to the Borrower until the date such amount is
repaid to the Agent, at (i) in the case of the Borrower, the interest rate
applicable at the time to the Revolving Credit Loans comprising such Borrowing
and (ii) in the case of such Lender, the Federal Funds Rate. If such Lender
shall repay to the Agent such corresponding amount, such amount so repaid shall
constitute such Lender's Loan as part of such Borrowing for purposes of this
Agreement. If the Borrower shall repay to the Agent such corresponding amount,
such payment shall not relieve such Lender of any obligation it may have to the
Borrower hereunder.
(g) The failure of any Lender to make the Loan to be made by
it as part of any Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its Loan on the date of such Borrowing,
but no Lender shall be responsible for the failure of any other Lender to make
the Loan to be made by such other Lender on the date of any Borrowing.
2.4. Fees. (a) The Borrower agrees to pay to the Agent for the
benefit of each Lender a commitment fee (the "Commitment Fee") on the daily
unused portion of such Lender's Revolving Credit Commitment from the date hereof
until the Termination Date at the rate of 1/2 of 1% per annum, payable in
arrears on (i) the first day of each month during the term of such Lender's
Revolving Credit Commitment and (ii) the Termination Date. If the Borrower fails
to pay (either from the proceeds of a Borrowing or otherwise) any Commitment Fee
when due, such Commitment Fee shall immediately constitute, without necessity of
further act or
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evidence, a Revolving Credit Loan to the Borrower. All Revolving Credit Loans
made pursuant to this Section 2.4 shall be made as Base Rate Loans.
(b) The Borrower has agreed to pay to Citibank additional
fees, the amount and dates of payment of which are embodied in a separate
agreement by and between the Borrower and Citibank dated September 18, 1995.
2.5. Reduction and Termination of the Revolving Credit
Commitments. The Borrower may, upon at least three Business Days' prior notice
to the Agent, terminate in whole or reduce ratably in part the unused portions
of the respective Revolving Credit Commitments of the Lenders; provided,
however, that each partial reduction shall be in the aggregate amount of not
less than $5,000,000 or an integral multiple of $1,000,000 in excess thereof.
2.6. Repayment. The Borrower shall repay the entire unpaid
principal amount of the Loans on the Termination Date.
2.7. Prepayments. (a) The Borrower shall have no right to
prepay the principal amount of any Revolving Credit Loan or any Swing Loan other
than as provided in this Section 2.7.
(b) The Borrower may at any time prepay the outstanding
principal amount of the Swing Loans in whole or ratably in part.
(c) (i) The Borrower may at any time prepay the outstanding
principal amount of the Loans in whole or ratably in part with the proceeds of
Collateral.
(ii) The Borrower may, upon at least one Business Day's prior
notice to the Agent stating the proposed date of the prepayment, prepay the
outstanding principal amount of the Loans in whole (together with accrued
interest to the date of such prepayment) or ratably in part. Upon the giving of
such notice of prepayment, the principal amount of the Loans specified to be
prepaid shall become due and payable on the date specified for each such
prepayment.
(iii) The Borrower shall, on each Business Day, prepay an
aggregate principal amount of the Revolving Credit Loans comprising part of the
same Borrowing and Swing Loans equal to the amount by which (A) (I) the sum of
the aggregate principal amount of Revolving Credit Loans, Letter of Credit
Obligations and Swing Loans then outstanding minus (II) the aggregate amount
then on deposit in the Cash Collateral Account and the L/C Cash Collateral
Account exceeds (B) the lesser of the Revolving Credit Commitments and the
Borrowing Base.
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(iv) Any prepayment made pursuant to this Section 2.7(c) shall
be applied first to the Swing Loans outstanding and, if no Swing Loans are
outstanding, then, to the Revolving Credit Loans outstanding. If (A) the only
Loans outstanding are Eurodollar Rate Loans, (B) there are no Letter of Credit
Obligations immediately due and payable, (C) the application of such immediately
available funds will cause the Borrower to incur an obligation under Section
10.4 and (D) there is no Default or Event of Default then continuing, then such
prepayment shall be deposited into the Cash Collateral Account and shall be
retained therein until one of the conditions set forth in clauses (A) through
(D) are no longer met, in which case such funds shall be applied as provided in
this Section 2.7(c); provided, however, that at any time the only condition not
met is the condition specified in clause (B), then such funds shall be applied
to fund the L/C Cash Collateral Account.
(d) After the occurrence of a Default, an Event of Default or
a Triggering Condition and until such Default or Event of Default has been cured
or waived or the occurrence of a Triggering Condition Unwind, all immediately
available funds in the Concentration Account shall be applied on the date on
which they are immediately available first to the outstanding principal amount
of the Swing Loans, next to the outstanding principal amount of the Revolving
Credit Loans, and next to the other Obligations (other than any Letter of Credit
Obligations), as more fully described in Section 5 of the Cash Collateral
Account Agreement. Thereafter, the Borrower may direct the disposition of any
funds remaining in the Concentration Account and the Investment Account;
provided that, if a Default or an Event of Default shall have occurred and be
continuing, then such funds in the Concentration Account and the Investment
Account shall be used to cash collateralize the Letter of Credit Obligations,
and thereafter, the Borrower shall direct the disposition of such remaining
funds.
(e) All proceeds of Collateral received by the Secured Parties
after the giving of notice to the Borrower pursuant to clause (i) or (ii) of the
first sentence of Section 8.2 shall be applied first to fund the L/C Cash
Collateral Account, and if the L/C Cash Collateral Account has been fully funded
pursuant to Section 8.3, to repay any Swing Loans then outstanding together with
accrued interest thereon, and if no Swing Loans or accrued interest are
outstanding, ratably, to repay all other Loans outstanding together with accrued
interest thereon, and if no such Loans or accrued interest are outstanding, then
to repay the Secured Parties, ratably, in respect of all other Obligations
hereunder.
2.8. Conversion/Continuation Option. The Borrower may elect
(i) at any time to convert Base Rate Loans or any portion thereof to Eurodollar
Rate Loans or (ii) at the end of any Interest Period with respect thereto, to
convert Eurodollar Rate Loans or any portion thereof into Base Rate Loans, or to
continue such Eurodollar Rate Loans or any portion thereof for an additional
Interest Period; provided, however, that the aggregate of the Eurodollar Rate
Loans for each Interest
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Period therefor must be in the amount of $5,000,000 or an integral multiple of
$1,000,000 in excess thereof. Each conversion or continuation shall be allocated
among the Revolving Credit Loans of all Lenders in accordance with their Ratable
Portion. Each such election shall be in substantially the form of Exhibit D
hereto (a "Notice of Conversion or Continuation") and shall be made by giving
the Agent at least three Business Days' prior written notice thereof specifying
(A) the amount and type of conversion or continuation, and (B) in the case of a
conversion, the date of conversion (which date shall be a Business Day and, if a
conversion from Eurodollar Rate Loans, shall also be the last day of the
Interest Period therefor). No conversion of any Swing Loan from a Base Rate Loan
may be made. The Agent shall promptly notify each Lender of its receipt of a
Notice of Conversion or Continuation and of the contents thereof.
Notwithstanding the foregoing, no conversion in whole or in part of Base Rate
Loans to Eurodollar Rate Loans, and no continuation in whole or in part of
Eurodollar Rate Loans upon the expiration of any Interest Period therefor, shall
be permitted at any time at which a Default or an Event of Default shall have
occurred and be continuing. If, within the time period required under the terms
of this Section 2.8, the Agent does not receive a Notice of Conversion or
Continuation from the Borrower containing a permitted election to continue any
Eurodollar Rate Loans for an additional Interest Period or to convert any such
Loans, or on any date the aggregate unpaid principal amount of Eurodollar Rate
Loans comprising any Borrowing is reduced, by payment or prepayment or
otherwise, to less than $5,000,000, then, upon the expiration of the Interest
Period therefor, such Loans will be automatically converted to Base Rate Loans.
Each Notice of Conversion or Continuation shall be irrevocable.
2.9. Interest. (a) The Borrower shall pay interest on the
unpaid principal amount of each Loan from the date thereof until the principal
amount thereof shall be paid in full, at the following rates per annum:
(i) Base Rate Loans. For Base Rate Loans, at a rate per annum
equal at all times to the Applicable Margin plus the Base Rate in
effect from time to time, payable in arrears monthly on the first day
of each month and on the Termination Date; provided, however, that
during the continuance of an Event of Default, Base Rate Loans shall
bear interest, payable on demand, at a rate per annum equal at all
times to 2% per annum above the Base Rate in effect from time to time
plus the Applicable Margin.
(ii) Eurodollar Rate Loans. For Eurodollar Rate Loans, at a
rate per annum equal at all times to the sum of the Eurodollar Rate for
the applicable Interest Period for such Eurodollar Rate Loan plus the
Applicable Margin in effect from time to time, payable in arrears on
each day during such Interest Period which occurs on the first day of a
month and on the last day of such Interest Period; provided, however,
that during the continuance of an Event of Default, all Eurodollar Rate
Loans shall bear interest, payable on
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demand, at a rate per annum equal at all times to 2% above the
Eurodollar Rate for such Eurodollar Rate Loan plus the Applicable
Margin.
(b) If the Borrower fails to pay any interest when due, such
interest shall immediately constitute, without necessity of further act or
evidence, a Revolving Credit Loan to the Borrower.
2.10. Interest Rate Determination. (a) The Eurodollar Rate for
each Interest Period for Eurodollar Rate Loans shall be determined by the Agent
two Business Days before the first day of such Interest Period.
(b) The Agent shall give prompt notice to the Borrower and the
Lenders of the applicable interest rate determined by the Agent for purposes of
Section 2.8.
(c) If, with respect to Eurodollar Rate Loans, any Lender
notifies the Agent that the Eurodollar Rate for any Interest Period therefor
will not adequately reflect the cost to such Lender of making such Loans or
funding or maintaining its respective Eurodollar Rate Loans for such Interest
Period, the Agent shall forthwith so notify the Borrower and the Lenders,
whereupon;
(i) each Eurodollar Rate Loan will automatically, on the last
day of the then existing Interest Period therefor, convert into a Base
Rate Loan; and
(ii) the obligations of all the Lenders to make Eurodollar
Rate Loans or to convert Base Rate Loans into Eurodollar Rate Loans
shall be suspended until the Agent shall notify the Borrower that such
Lenders have determined that the circumstances causing such suspension
no longer exist.
2.11. Increased Costs. If, due to either (i) the introduction
of or any change in or in the interpretation of any law or regulation (other
than any change by way of imposition or increase of reserve requirements
included in determining the Eurodollar Rate Reserve Percentage) or (ii)
compliance with any guideline or request from any central bank or other
Governmental Authority (whether or not having the force of law), there shall be
any increase in the cost to any Lender Party of agreeing to make or making,
funding or maintaining any Eurodollar Rate Loans or of agreeing to issue or of
issuing or maintaining Letters of Credit, then the Borrower shall from time to
time, upon demand by such Lender Party (with a copy of such demand to the
Agent), pay to the Agent for the account of such Lender Party additional amounts
sufficient to compensate such Lender Party for such increased cost. A
certificate as to the amount of such increased cost, submitted to the Borrower
and the Agent by such Lender Party, shall be conclusive and binding for all
purposes, absent manifest error. If the Borrower so notifies the Agent within
five Business Days after any Lender Party notifies the Borrower of any increased
cost pursuant to the foregoing provisions
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of this Section 2.11, the Borrower may convert all Eurodollar Rate Loans of all
Lenders then outstanding into Base Rate Loans, in accordance with Section 2.8
and, additionally, reimburse such Lender Party for such increased cost in
accordance with this Section 2.11.
2.12. Illegality. Notwithstanding any other provision of this
Agreement, if the introduction of, or any change in, or any change in the
interpretation of, any law or regulation shall make it unlawful, or any central
bank or other Governmental Authority shall assert that it is unlawful, for any
Lender or its Eurodollar Lending Office to make Eurodollar Rate Loans or to
continue to fund or maintain Eurodollar Rate Loans, then, on notice thereof and
demand therefor by such Lender to the Borrower through the Agent, (i) the
obligation of such Lender to make or to continue Eurodollar Rate Loans and to
convert Base Rate Loans into Eurodollar Rate Loans shall terminate and (ii) the
Borrower shall forthwith prepay in full all Eurodollar Rate Loans of such Lender
then outstanding, together with interest accrued thereon, unless the Borrower,
within five Business Days of such notice and demand, converts all Eurodollar
Rate Loans of all Lenders then outstanding into Base Rate Loans.
2.13. Capital Adequacy. If (i) the introduction of, or any
change in or in the interpretation of, any law or regulation, (ii) the
compliance with any law or regulation, or (iii) compliance with any guideline or
request from any central bank or other Governmental Authority (whether or not
having the force of law), affects or would affect the amount of capital required
or expected to be maintained by any Lender Party or any corporation controlling
any Lender Party and such Lender Party reasonably determines that such amount is
based upon the existence of such Lender Party's Commitment and Loans and other
commitments and loans of this type including, without limitation, such Lender
Party's commitments in respect of Letters of Credit (or similar contingent
obligations), then, upon demand by such Lender Party (with a copy of such demand
to the Agent), the Borrower shall pay to the Agent for the account of such
Lender Party, from time to time as specified by such Lender Party, additional
amounts sufficient to compensate such Lender Party in the light of such
circumstances, to the extent that such Lender Party reasonably determines such
increase in capital to be allocable to the existence of such Lender Party's
Commitment or Loans and such Lender Party's agreements herein with respect to
the issuance or maintenance of Letters of Credit. A certificate as to such
amounts submitted to the Borrower and the Agent by such Lender Party shall be
conclusive and binding for all purposes absent manifest error.
2.14. Payments and Computations. (a) The Borrower shall make
each payment hereunder and under the Revolving Credit Notes not later than 12:00
P.M. (New York City time) (except for payments made pursuant to Section 2.7(e)
which shall be credited no later than when received by the Agent) on the day
when due, in Dollars, to the Agent at its address referred to in Section 10.2 in
immediately
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available funds without set-off or counterclaim. The Agent will, on the Business
Day of its receipt thereof, cause to be distributed like funds relating to the
payment of principal of or interest on the Loans (other than Swing Loans) or
fees with respect to any Loans (other than amounts payable pursuant to Section
2.11, 2.12, 2.13, 2.15, or 2.17(h)) to the Lenders, in accordance with their
respective Ratable Portions, for the account of their respective Applicable
Lending Offices, and like funds relating to the payment of any other amount
payable to any Lender Party to such Lender Party for the account of its
Applicable Lending Office, in each case to be applied in accordance with the
terms of this Agreement; provided, however, that payment of principal of the
Swing Loans pursuant to Section 2.7(e) need not be distributed by the Agent
prior to the Settlement Date referred to in Section 2.18. With respect to the
Swing Loans, the Agent will promptly thereafter cause to be distributed like
funds relating to the payment of principal of or interest on the Swing Loans to
the Swing Bank for the account of its Applicable Lending Office. Upon its
acceptance of an Assignment and Acceptance and recording of the information
contained therein in the Register pursuant to Section 10.7, from and after the
effective date of such Assignment and Acceptance, the Agent shall make all
payments hereunder and under the Revolving Credit Notes in respect of the
interest assigned thereby to the Lender Party assignee thereunder, and the
parties to such Assignment and Acceptance shall make all appropriate adjustments
in such payments for periods prior to such effective date directly between
themselves. Payment received by the Agent after 12:00 P.M. (New York City time)
shall be deemed to be received on the next Business Day (except for payments
made pursuant to Section 2.7(e) which shall be credited no later than when
received by the Agent). Prior to the distribution of any funds to any Lender
Party pursuant to this Section 2.14, the Agent shall use its best efforts to
notify such Lender Party of such distribution.
(b) Upon the occurrence of a Default, an Event of Default or a
Triggering Condition, all amounts on deposit in each of the Blocked Account and
the Cash Collateral Account shall be applied by the Agent against the
outstanding balance of the Obligations in accordance with Section 2.7(d);
provided, however, that in no event shall any amount be required to be applied
by the Agent against the outstanding balance of the Obligations unless and until
such amount shall have been credited in immediately available funds to the
Blocked Account or the Cash Collateral Account.
(c) The Borrower hereby authorizes each Lender Party, if and
to the extent payment owed to such Lender Party is not made when due hereunder,
to charge from time to time against any or all of the Borrower's accounts with
such Lender Party any amount so due or to treat any amounts due hereunder as
having been paid by proceeds of a Revolving Credit Borrowing. The Borrower and
the Lender Parties hereby authorize the Swing Bank to pay directly any amount
due hereunder and to treat such payment as a Swing Loan.
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(d) All computations of interest and fees shall be made by the
Agent on the basis of a year of 360 days, and the actual number of days
(including the first day but excluding the last day) occurring in the period for
which such interest and fees are payable. Each determination by the Agent of an
interest rate hereunder shall be conclusive and binding for all purposes, absent
manifest error.
(e) Whenever any payment hereunder or under the Revolving
Credit Notes shall be stated to be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day, and such extension of
time shall in such case be included in the computation of payment of interest or
fee, as the case may be; provided, however, that if such extension would cause
payment of interest on or principal of any Eurodollar Rate Loan to be made in
the next calendar month, such payment shall be made on the next preceding
Business Day.
(f) Unless the Agent shall have received notice from the
Borrower prior to the date on which any payment is due hereunder to any Lender
Party hereunder that the Borrower will not make such payment in full, the Agent
may assume that the Borrower has made such payment in full to the Agent on such
date and the Agent may, in reliance upon such assumption, cause to be
distributed to each such Lender Party on such due date an amount equal to the
amount then due such Lender Party. If and to the extent the Borrower shall not
have so made such payment in full to the Agent, each such Lender Party shall
repay to the Agent forthwith on demand such amount distributed to such Lender
Party together with interest thereon, for each day from the date such amount is
distributed to such Lender Party until the date such Lender Party repays such
amount to the Agent, at the Federal Funds Rate.
2.15. Taxes. (a) Any and all payments by the Borrower
hereunder, under the Revolving Credit Notes and under the Letter of Credit
Reimbursement Agreements shall be made, in accordance with Section 2.14, free
and clear of and without deduction for any and all present or future taxes,
levies, imposts, deductions, charges or withholdings, and all liabilities with
respect thereto, excluding, (i) in the case of each Lender Party and the Agent,
taxes measured by its net income, and franchise taxes imposed on it, by the
jurisdiction under the laws of which such Lender Party or the Agent (as the case
may be) is organized or any political subdivision thereof, (ii) in the case of
each Lender Party, taxes (including, but not limited to, the Branch Profits Tax
under Section 884 of the Code) measured by its net income, and franchise taxes
imposed on it, by the jurisdiction of such Lender Party's Applicable Lending
Office or any political subdivision thereof and (iii) in the case of each Lender
Party organized under the laws of a jurisdiction outside the United States,
United States federal withholding tax payable with respect to payments by the
Borrower which would not have been imposed had such Lender Party, to the extent
then required thereunder, delivered to the Borrower and the Agent the forms
prescribed by Section 2.15(f) (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities being hereinafter referred to
as "Taxes"). If the Xxxxxxxx
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xxxxx xx required by law to deduct any Taxes from or in respect of any sum
payable hereunder to any Lender Party or the Agent, (i) the sum payable shall be
increased as may be necessary so that after making all required deductions
(including, without limitation, deductions applicable to additional sums payable
under this Section 2.15) such Lender Party or the Agent (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions, (iii) the
Borrower shall pay the full amount deducted to the relevant taxing authority or
other authority in accordance with applicable law, and (iv) the Borrower shall
deliver to the Agent evidence of such payment to the relevant taxation or other
authority.
(b) In addition, the Borrower agrees to pay any present or
future stamp or documentary taxes or any other excise or property taxes, charges
or similar levies of the United States or any political subdivision thereof or
any applicable foreign jurisdiction which arise from any payment made by the
Borrower hereunder or under any Letter of Credit Reimbursement Agreement or from
the execution, delivery or registration of, or otherwise with respect to, any
Loan Document (hereinafter referred to as "Other Taxes").
(c) The Borrower agrees to indemnify each Lender Party and the
Agent for the full amount of Taxes and Other Taxes (including, without
limitation, any Taxes and Other Taxes imposed by any jurisdiction on amounts
payable under this Section 2.15) imposed on or paid by such Lender Party or the
Agent (as the case may be) and any liability (including, without limitation, for
penalties, interest and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted.
This indemnification shall be made within 30 days from the date such Lender
Party or the Agent (as the case may be) makes written demand therefor. Any such
demand shall show in reasonable detail the amount payable and the calculations
used to determine, in good faith, such amount and shall provide reasonably
acceptable proof of payment of such Tax or Other Tax.
(d) Within 30 days after the date of any payment of Taxes or
Other Taxes, the Borrower will furnish to the Agent, at its address referred to
in Section 10.2, the original or a certified copy of a receipt evidencing
payment thereof. If no Taxes are payable in respect of any payment hereunder
made (i) by or on behalf of the Borrower other than by a "United States person"
within the meaning of Section 7701(a)(30) of the Code or (ii) out of funds from
an account outside the United States, the Borrower will furnish to the Agent a
certificate from each appropriate taxing authority, or an opinion of counsel
acceptable to the Agent, in either case stating that such payment is exempt from
or not subject to Taxes. For purposes of this subsection (d) and subsection (f),
the term "United States" shall have the meaning specified in Section 7701 of the
Code.
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(e) Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 2.15 shall survive the payment in full of principal
and interest hereunder and the termination of the Revolving Credit Commitments.
(f) Each Lender Party organized under the laws of a
jurisdiction outside the United States, on or prior to the Effective Date in the
case of each Lender Party listed on the signature pages hereof, and on the date
of the Assignment and Acceptance pursuant to which it becomes a Lender Party in
the case of each other Lender Party, and from time to time thereafter if
reasonably requested by the Borrower or the Agent (unless such Lender Party is
unable to do so by reason of a change in law (including, without limitation, any
statute, treaty, ruling, determination or regulation) occurring subsequent to
the Effective Date or date of Assignment and Acceptance, as the case may be),
each Lender Party organized under the laws of a jurisdiction outside the United
States shall provide the Agent and the Borrower with two original IRS Forms 4224
or 1001, as appropriate, or other applicable form, certificate or document
prescribed by the IRS, certifying that such Lender Party is exempt from or
entitled to a reduced rate of United States withholding tax with respect to all
payments to be made to such Lender Party hereunder, under any Revolving Credit
Note and under any Letter of Credit Reimbursement Agreement. If any form or
document referred to in this subsection (f) requires the disclosure of
information, other than information necessary to compute the tax payable and
information required on the date hereof by Internal Revenue Service Form 1001 or
4224 that the Lender Party reasonably considers to be confidential, the Lender
Party shall give notice thereof to the Borrower and shall not be obligated to
include in such form or document such confidential information. Unless the
Borrower and the Agent have received forms or other documents satisfactory to
them indicating that payments hereunder, under any Revolving Credit Note or
under any Letter of Credit Reimbursement Agreement are not subject to United
States withholding tax, the Borrower or the Agent shall, in the case of payments
to or for any Lender Party organized under the laws of a jurisdiction outside
the United States, (i) withhold taxes from such payments at the applicable
statutory rate, or at a rate reduced by an applicable tax treaty (provided that
the Borrower and the Agent have received forms or other documents satisfactory
to them indicating that such reduced rate applies) and (ii) pay such Lender
Party such payment net of any taxes withheld; provided, however, that should a
Lender Party become subject to Taxes because of its failure to deliver a form
required hereunder, the Borrower shall take such steps as such Lender Party
shall reasonably request to assist such Lender Party to recover such Taxes.
2.16. Sharing of Payments, Etc. If any Lender Party shall
obtain any payment (whether voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) on account of the Loans (other than Swing Loans)
made by it (other than pursuant to Section 2.7, 2.11, 2.12, 2.13, 2.14 or
2.17(h)) in excess of its Ratable Portion of payments on account of the Loans
(other than Swing Loans) obtained by all
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the Lender Parties, such Lender Party shall forthwith purchase from the other
Lender Parties such participations in their Loans (other than Swing Loans) as
shall be necessary to cause such purchasing Lender Party to share the excess
payment ratably with each of them; provided, however, that if all or any portion
of such excess payment is thereafter recovered from such purchasing Lender
Party, such purchase from each Lender Party shall be rescinded and such Lender
Party shall repay to the purchasing Lender Party the purchase price to the
extent of such recovery together with an amount equal to such Lender Party's
ratable share (according to the proportion of (i) the amount of such Lender
Party's required repayment to (ii) the total amount so recovered from the
purchasing Lender Party) of any interest or other amount paid or payable by the
purchasing Lender Party in respect of the total amount so recovered. The
Borrower agrees that any Lender Party so purchasing a participation from another
Lender Party pursuant to this Section 2.16 may, to the fullest extent permitted
by law, exercise all its rights of payment (including, without limitation, the
right of set-off) with respect to such participation as fully as if such Lender
Party were the direct creditor of the Borrower in the amount of such
participation.
2.17. Letter of Credit Facility. (a) On the terms and subject
to the conditions contained in this Agreement, each Issuer agrees to issue one
or more Letters of Credit at the request of the Borrower for the account of the
Borrower from time to time during the period commencing on the date hereof and
ending on the Termination Date; provided, however, that no Issuer shall issue
any Letter of Credit if:
(i) any order, judgment or decree of any Governmental
Authority or arbitrator shall purport by its terms to enjoin or
restrain such Issuer from issuing such Letter of Credit or any
Requirement of Law applicable to such Issuer or any request or
directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over such Issuer shall
prohibit, or request that such Issuer refrain from, the issuance of
letters of credit generally or such Letter of Credit in particular or
shall impose upon such Issuer with respect to such Letter of Credit any
restriction or reserve or capital requirement (for which such Issuer is
not otherwise compensated) not in effect on the date hereof or result
in any unreimbursed loss, cost or expense which was not applicable, in
effect or known to such Issuer as of the date hereof and which such
Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from any
Lender Party or the Borrower, on or prior to the Business Day prior to
the requested date of issuance of such Letter of Credit, that one or
more of the applicable conditions contained in Article III is not then
satisfied;
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(iii) the amount of the Letter of Credit requested exceeds the
Available Credit or, upon the issuance of the requested Letter of
Credit, the Letter of Credit Undrawn Amounts would exceed $35,000,000;
or
(iv) fees due in connection with a requested issuance have not
been paid.
None of the Lender Parties (other than the Issuers) shall have any obligation to
issue any Letters of Credit.
(b) In no event shall:
(i) the expiration date of any Letter of Credit be more than
one year after the date of issuance thereof, nor shall the expiration
date of any Letter of Credit fall after the date that is 60 days prior
to the Termination Date; except that any such Letter of Credit may also
be on the following terms: such Letter of Credit shall have an initial
one year term which shall be automatically extended for successive
one-year terms (but in no case may such Letter of Credit be extended
such that its expiration date falls after the date that is 60 days
prior to the Termination Date); provided, however, that such a Letter
of Credit shall not be automatically extended if either (A) the
beneficiary of such Letter of Credit is sent a notice that an Event of
Default shall have occurred and be continuing at any time prior to the
date that is 30 days prior to the date of such extension or (B) the
Borrower requests in writing no later than 40 days prior to the date of
such extension that the term of such Letter of Credit shall not be
extended; or
(ii) any Issuer issue any Letter of Credit for the purpose of
supporting the issuance of any letter of credit by any other Person
except with the prior written consent of the Agent.
(c) Prior to the issuance of each Letter of Credit, and as a
condition of such issuance and of the participation of each Lender (other than
the Issuer thereof) in the Letter of Credit Obligations arising with respect
thereto, the Borrower shall have delivered to the Issuer thereof a letter of
credit reimbursement agreement, in a form satisfactory to the Issuer (as the
same as may be amended or otherwise modified, a "Letter of Credit Reimbursement
Agreement"), signed by the Borrower, and such other documents or items as may be
required pursuant to the terms thereof or otherwise reasonably required by the
Issuer. In the event of any conflict between the terms of any Letter of Credit
Reimbursement Agreement and this Agreement, the terms of this Agreement shall
govern.
(d) In connection with the issuance of each Letter of Credit,
the Borrower shall give the Issuer thereof and the Agent at least two Business
Days' prior
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written notice of its requested issuance of a Letter of Credit in substantially
the form of Exhibit C (a "Letter of Credit Request"). Such notice shall be
irrevocable and shall specify the stated amount of the Letter of Credit
requested, which stated amount shall not be less than $50,000, the date of
issuance of such requested Letter of Credit (which day shall be a Business Day),
the date on which such Letter of Credit is to expire, and the Person for whose
benefit the requested Letter of Credit is to be issued. Such notice, to be
effective, must be received by such Issuer and the Agent not later than 11:00
A.M. (New York City time) on or prior to the last Business Day on which notice
can be given under the immediately preceding sentence. Prior to the close of
business on the Business Day following the Business Day on which the Agent first
receives such notice, the Agent shall confirm to the Issuer of the requested
Letter of Credit whether the applicable conditions in Article III are satisfied
as of such date.
(e) Subject to the terms and conditions of this Section 2.17
and provided that the applicable conditions set forth in Article III have been
satisfied, such Issuer shall, on the requested date, issue a Letter of Credit on
behalf of the Borrower in accordance with the Issuer's usual and customary
business practices.
(f) Immediately upon the issuance by an Issuer of a Letter of
Credit in accordance with the terms and conditions of this Agreement, such
Issuer shall be deemed to have sold and transferred to each Lender, and each
Lender shall be deemed irrevocably and unconditionally to have purchased and
received from such Issuer, without recourse or warranty, an undivided interest
and participation, to the extent of such Lender's Ratable Portion, in such
Letter of Credit and the obligations of the Borrower with respect thereto
(including, without limitation, all Letter of Credit Obligations with respect
thereto) and any security therefor and guaranty pertaining thereto and each
Lender's Revolving Credit Commitment shall be deemed used to the extent of such
Lender's Ratable Portion of such Letter of Credit Obligations.
(g) In determining whether to pay under any Letter of Credit,
no Issuer shall have any obligation relative to the Lenders other than to
confirm that any documents required to be delivered under such Letter of Credit
appear to have been delivered and that they appear to comply on their face with
the requirements of such Letter of Credit. Any action taken or omitted to be
taken by any Issuer under or in connection with any Letter of Credit, if taken
or omitted in the absence of gross negligence or willful misconduct, shall not
put such Issuer under any resulting liability to any Lender, or diminish the
Agent's or any Lender's obligations hereunder to the Issuer.
(h) In the event that any Issuer makes any payment under any
Letter of Credit and the Borrower shall not have repaid such amount to such
Issuer pursuant to Section 2.17(l), such Issuer shall promptly notify the Agent,
which shall promptly notify each Lender of such failure, and each Lender shall
promptly and unconditionally pay to the Agent for the account of such Issuer the
amount of such Lender's
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Ratable Portion of such payment in Dollars and in same day funds (and upon
receipt the Agent shall promptly pay the same to the Issuer); provided, however,
if the Swing Bank so elects and if a Swing Loan can be made in such amount, the
Agent shall promptly notify the Swing Bank of such failure, and the Swing Bank
shall pay to the Agent for the account of such Issuer the amount of such payment
in Dollars and in same day funds. This Revolving Credit Loan shall be made, or
the Swing Loan may be made, notwithstanding the Borrower's failure to satisfy
the conditions set forth in Section 3.3. If the Agent so notifies such Lender
prior to 11:00 A.M. (New York City time) on any Business Day, such Lender shall
make available to the Agent for the account of such Issuer its Ratable Portion
of the amount of such payment on such Business Day in same day funds. If and to
the extent such Lender shall not have so made such Lender's Ratable Portion of
the amount of such payment available to the Agent for the account of such
Issuer, such Lender agrees to repay to the Agent for the account of such Issuer
forthwith on demand such amount together with interest thereon, for each day
from such date until the date such amount is repaid to the Agent for the account
of such Issuer, at the Federal Funds Rate. The failure of any Lender to make
available to the Agent for the account of such Issuer its Ratable Portion of any
such payment shall not relieve any other Lender of its obligation hereunder to
make available to the Agent for the account of such Issuer its Ratable Portion
of any payment on the date such payment is to be made, but no Lender shall be
responsible for the failure of any other Lender to make available to the Agent
for the account of any Issuer such other Lender's Ratable Portion of any such
payment.
(i) Whenever any Issuer receives a payment of a Reimbursement
Obligation as to which the Agent has received for the account of such Issuer any
payment from a Lender pursuant to Section 2.17(h) (and such amount has been paid
to such Issuer), the Issuer shall pay to the Agent such amount so received and
the Agent shall promptly pay to each Lender which has paid such Lender's Ratable
Portion thereof, in same day funds, an amount equal to such Lender's Ratable
Portion thereof.
(j) Upon the request of any Lender, each Issuer shall furnish
to such Lender copies of any Letter of Credit Reimbursement Agreement to which
such Issuer is a party and such other documentation as may reasonably be
requested by such Lender.
(k) The obligations of the Lenders to make payments to the
Agent for the account of each Issuer with respect to Letters of Credit shall be
irrevocable and not subject to any qualification or exception whatsoever and
shall be made in accordance with the terms and conditions of this Agreement
under all circumstances (except as expressly provided in Section 2.17(g)),
including, without limitation, any of the following circumstances:
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(i) any lack of validity or enforceability of this Agreement
or any of the Collateral Documents;
(ii) the existence of any claim, set-off, defense or other
right which the Borrower may have at any time against a beneficiary
named in a Letter of Credit, any transferee of any Letter of Credit (or
any Person for whom any such transferee may be acting), the Agent, any
Lender Party or any other Person, whether in connection with this
Agreement, any Letter of Credit, the transactions contemplated herein
or any unrelated transactions (including, without limitation, any
underlying transaction between the Borrower and the beneficiary named
in any Letter of Credit);
(iii) any draft, certificate or any other document presented
under the Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Collateral
Documents; or
(v) the occurrence of any Default or Event of Default.
(l) The Borrower agrees to pay to each Issuer the amount of
all Reimbursement Obligations owing to such Issuer under any Letter of Credit
immediately when due, irrespective of any claim, set-off, defense or other right
which the Borrower may have at any time against such Issuer or any other Person.
The Borrower agrees to reimburse each Issuer for all amounts which such Issuer
pays under such Letter of Credit no later than the time specified in such Letter
of Credit Reimbursement Agreement. If the Borrower does not pay (either from the
proceeds of a Borrowing or otherwise) any such Reimbursement Obligation when
due, such Reimbursement Obligation shall immediately constitute, without
necessity of further act or evidence, a Loan made by the relevant Issuer payable
on demand or, to the extent the Agent has received any payments from Lenders for
the account of such Issuer pursuant to Section 2.17(h), Revolving Credit Loans
made by such Lenders (which, in the case of each Lender, shall be to the extent
of such Lender's Ratable Portion of such Reimbursement Obligation) to the
Borrower, in an aggregate principal amount equal to such Reimbursement
Obligation remaining unpaid, or, to the extent the Agent has received any
payments from the Swing Bank for the account of such Issuer pursuant to Section
2.17(h), Swing Loans made by the Swing Bank, computed from the date on which
such Reimbursement Obligation arose to the date of repayment in full thereof at
the rate of interest applicable to past due Revolving Credit Loans at a rate
based on the Base Rate during such period. If any payment made by or on behalf
of the Borrower and received by any Issuer with respect to any Letter of Credit
is rescinded or must otherwise be returned by such Issuer for any reason, each
Lender shall, upon notice by such Issuer, forthwith pay over to such
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Issuer an amount equal to such Lender's Ratable Portion of the amount which must
be so returned by such Issuer or the Swing Bank may, upon notice to the Issuer,
forthwith pay over to such Issuer an amount equal to the amount which must be
returned by such Issuer.
(m) The Borrower agrees to pay the following amounts with
respect to Letters of Credit issued for it:
(i) to the Agent, for the benefit of each Lender who has
purchased or has been deemed to have purchased participations in the
Letters of Credit, with respect to each standby Letter of Credit or
documentary Letter of Credit, an administrative fee equal to a rate per
annum equal at all times to the Applicable Margin for Letter of Credit
Fees multiplied by the average daily maximum amount available from time
to time to be drawn under such Letter of Credit, payable monthly in
arrears and on the termination of such Letter of Credit, and, in each
case, calculated on the basis of a 360-day year and the actual number
of days elapsed; provided, however, that, during the continuance of an
Event of Default, such administrative fee shall increase by 2% per
annum and shall be payable on demand;
(ii) to each Issuer, with respect to each standby Letter of
Credit or documentary Letter of Credit issued by such Issuer, 0.375%
per annum of the average daily maximum amount available from time to
time to be drawn under such Letter of Credit, payable monthly in
arrears and on the termination of such Letter of Credit, and, in each
case calculated on the basis of a 360-day year and the actual number of
days elapsed; and
(iii) to each Issuer, with respect to the issuance, amendment
or transfer of each Letter of Credit and each drawing made thereunder,
issuance, documentary, processing and other charges in accordance with
such Issuer's standard schedule for such charges in effect at the time
of issuance, amendment, transfer or drawing, as the case may be.
2.18. Settlement of Accounts. The Agent shall notify each
Lender no less frequently than weekly, as determined by the Agent, of the
principal amount of Swing Loans outstanding as of 1:00 P.M. (New York City time)
as of such date (the "Computation Date") and each Lender's Ratable Portion
thereof. Each Lender shall before 1:00 P.M. (New York City time) on the next
Business Day (the "Settlement Date") make available to the Agent, in immediately
available funds, the amount of its Ratable Portion of such principal amount of
Swing Loans outstanding. Upon such payment by a Lender, such Lender shall be
deemed to have made a Revolving Credit Loan to the Borrower, notwithstanding any
failure by the Borrower to satisfy the conditions in Section 3.3. The Agent
shall use such funds to repay the principal
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amount of Swing Loans to the Swing Bank. All interest due on the Swing Loans
shall be payable to the Swing Bank in accordance with Sections 2.9 and 2.14.
2.19. The Blocked Account. (a) The Borrower has established
and shall maintain, pursuant to the Blocked Account Letter, an account with PNC
Bank, N.A., account number 0002881016, in the name and under the sole dominion
and control of the Agent (the "Blocked Account").
(b) As collateral security for the Obligations, the Borrower
hereby transfers, assigns and pledges to the Agent and grants to the Agent a
Lien on and security interest in, for the benefit of the Secured Parties on a
first priority basis, all of the right, title and interest of the Borrower in
the Blocked Account and all cash, deposits, Cash Equivalents and other
instruments held in the Blocked Account, as security for the Obligations. The
Agent shall possess sole dominion and control over the Blocked Account as
provided in the Blocked Account Letter. Except as provided in Section 2.7(d) and
the Blocked Account Letter, as long as any of the Obligations remain unpaid or
any of the Commitments are outstanding, the Borrower agrees that neither the
Borrower nor any Person or entity claiming by, through or under the Borrower
shall have any control over the use of, or any right to effect a withdrawal
from, the Blocked Account. All amounts in the Blocked Account shall be applied
to the Obligations by the Agent as specified in Section 2.7(d).
(c) Except for the funds held in the bank accounts otherwise
permitted by Section 7.17, the Borrower shall cause all cash, Cash Equivalents,
checks, notes, drafts or similar items of payments received by it which
constitute (i) payments from account debtors for Accounts not sold pursuant to
the Receivables Securitization, including, without limitation, all intercompany
receivables and (ii) proceeds of all other Collateral to be deposited on the
date of receipt thereof or the next Business Day following receipt thereof in
the Blocked Account.
ARTICLE III
CONDITIONS PRECEDENT
3.1. Conditions Precedent to the Effective Date. The
effectiveness of this Agreement is subject to satisfaction of the conditions
precedent that the Agent shall have received, on or before the Effective Date,
the following, each dated as of the Effective Date unless otherwise indicated,
in form and substance satisfactory to the Agent and (except for the Revolving
Credit Notes) in sufficient copies for each Lender Party:
(a) The Revolving Credit Notes to the order of each Lender,
respectively.
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(b) Certified copies of (i) the resolutions of the Board of
Directors of each Loan Party approving each Loan Document to which it is a
party, and (ii) all documents evidencing other necessary corporate action and
required governmental and third party approvals, licenses and consents to the
transactions contemplated hereby.
(c) A copy of the articles or certificate of incorporation of
each Loan Party and of each of the Borrower's Subsidiaries which is not a Loan
Party certified as of a recent date by the Secretary of State of the state of
incorporation of such Loan Party or Subsidiary, together with certificates of
such official attesting to the good standing of each such Loan Party and
Subsidiary, and a copy of the certificate of incorporation and the By-Laws of
each Loan Party and of each of the Borrower's Subsidiaries certified as of the
Effective Date by the Secretary or an Assistant Secretary of each Loan Party or
Subsidiary.
(d) A certificate of the Secretary or an Assistant Secretary
of each Loan Party certifying the names and true signatures of each officer of
such Loan Party who have been authorized to execute and deliver any Loan
Document or other document required to be executed and delivered hereunder by or
on behalf of such Loan Party.
(e) Amendment No. 3 to the Borrower Security Agreement, duly
executed by the Borrower, together with:
(A) acknowledgment copies of proper termination
statements (Form UCC-3 or a comparable form), duly filed on or before
the Effective Date under the Uniform Commercial Code of the States
listed on Schedule 3.1 and all other jurisdictions that the Agent may
deem necessary or desirable in order to terminate the Liens (other than
the Liens created by the Borrower Security Agreement) covering the
Collateral described in the Borrower Security Agreement,
(B) acknowledgment copies of proper financing
statements (Form UCC-1), duly filed on or before the Effective Date
under the Uniform Commercial Code of all jurisdictions that may be
necessary or that the Agent may deem desirable in order to perfect and
protect the Liens created by the Borrower Security Agreement, covering
the Collateral described in the Borrower Security Agreement,
(C) evidence of the insurance required by the terms
of the Borrower Security Agreement,
(D) copies of the Assigned Agreements, if any,
referred to in the Borrower Security Agreement, together with a consent
to such assignment,
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duly executed by each party to such Assigned Agreements other than the
Borrower,
(E) the Blocked Account Letters referred to therein,
duly executed by PNC Bank, and
(F) evidence that all other action that the Agent may
deem necessary or desirable in order to perfect and protect the Liens
created under the Borrower Security Agreement has been taken or will be
taken in accordance with the terms of the Loan Documents.
(f) Amendment No. 1 to the Borrower Pledge Agreement, duly
executed by the Borrower, together with:
(A) certificates representing the Pledged Shares
referred to therein accompanied by undated stock powers executed in
blank and instruments, if any, evidencing the Pledged Debt referred to
therein indorsed in blank, and
(B) evidence that all other action that the Agent may
deem necessary or desirable in order to perfect and protect the Liens
created under the Borrower Pledge Agreement has been taken or will be
taken in accordance with the terms of the Loan Documents.
(g) The Holdings Guaranty, duly executed by Holdings.
(h) The Holdings Pledge Agreement, duly executed by Holdings,
together with:
(A) certificates representing the Pledged Shares
referred to therein accompanied by undated stock powers executed in
blank; and
(B) evidence that all other action that the Agent may
deem necessary or desirable in order to perfect and protect the Liens
created under the Holdings Pledge Agreement has been taken or will be
taken in accordance with the terms of the Loan Documents.
(i) The Guaranty, duly executed by the Guarantors.
(j) The Guarantor Security Agreement, duly executed by each
Guarantor, together with:
(A) acknowledgment copies of proper termination
statements (Form UCC-3 or a comparable form), duly filed on or before
the Effective
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Date under the Uniform Commercial Code of the States listed on Schedule
3.1 and all other jurisdictions that the Agent may deem necessary or
desirable in order to terminate the Liens (other than the Liens created
by the Guarantor Security Agreement) covering the Collateral described
in the Guarantor Security Agreement,
(B) acknowledgment copies of proper financing
statements (Form UCC-1), duly filed on or before the Effective Date
under the Uniform Commercial Code of all jurisdictions that may be
necessary or that the Agent may deem desirable in order to perfect and
protect the Liens created by the Guarantor Security Agreement, covering
the Collateral described in the Guarantor Security Agreement,
(C) evidence of the completion of all other
recordings and filings of or with respect to the Guarantor Security
Agreement that the Agent may deem necessary or appropriate in order to
perfect and protect the Liens created thereby,
(D) evidence of the insurance required by the terms
of the Guarantor Security Agreement,
(E) copies of the Assigned Agreements, if any,
referred to in the Guarantor Security Agreement, together with a
consent to such assignment, duly executed by each party to such
Assigned Agreements other than the Borrower,
(F) the Blocked Account Letters referred to therein,
duly executed by PNC Bank, and
(G) evidence that all other action that the Agent may
deem necessary or desirable in order to perfect and protect the Liens
created under the Guarantor Security Agreement has been taken or will
be taken in accordance with the terms of the Loan Documents.
(k) The Keepwell Agreement, duly executed by WHX and Holdings.
(l) The Holdings Intercreditor Agreement, duly executed by
WHX, Holdings and the Borrower.
(m) The Cash Collateral Account Agreement, duly executed by
the Borrower.
(n) A favorable opinion of (i) Olshan, Grundman, Frome &
Xxxxxxxxxx LLP, outside general counsel to Holdings, the Borrower and the
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Guarantors, and (ii) Xxxxxxxxxxx and Xxxxxxxx LLP, special counsel to the
Borrower in Pennsylvania, Ohio and West Virginia, each in substantially the form
of Exhibit O-1 or O-2, respectively, and as to such other matters as any Lender
through the Agent may reasonably request.
(o) A certificate, signed by a Responsible Officer of the
Borrower, stating that the conditions specified in Sections 3.2(a), (b) and (f)
and 3.3(a)(i) have been met.
(p) A certificate of the chief financial officer of the
Borrower in form and substance satisfactory to the Lender Parties, attesting to
(i) the Solvency of each Loan Party after giving effect to the transactions
contemplated hereby and (ii) the amount of "Adjusted Net Assets" (as defined in
the Guaranty) of each Guarantor on the Effective Date.
(q) Such additional documents, information and materials as
any Lender Party, through the Agent, may reasonably request.
3.2. Additional Conditions Precedent to the Effective Date.
The effectiveness of this Agreement is subject to the further conditions
precedent that:
(a) On the Effective Date, the following statements shall be
true:
(i) All necessary governmental and third party approvals
required to be obtained by any Loan Party, in connection with the
transactions contemplated hereby, including, without limitation, the
obtaining of the Loans and Letters of Credit, have been obtained and
remain in effect, and all applicable waiting periods have expired
without any action being taken by any competent authority which
restrains, prevents, impedes, delays or imposes materially adverse
conditions upon, the consummation of the transactions contemplated
hereby;
(ii) There exists no claim, action, suit, investigation or
proceeding pending or, to the knowledge of the Borrower, threatened in
any court or before any arbitrator or Governmental Authority which
relates to the financing hereunder or those which, if adversely
determined, would have a Material Adverse Effect;
(iii) There exists no default under the 1994 Credit Agreement
or any loan documents executed in connection with the 1994 Credit
Agreement; and
(iv) There exists no default under any Indenture, the First
Mortgage Notes or the Permanent Financing Notes.
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(b) All costs and accrued and unpaid fees (including, without
limitation, all upfront fees) and expenses (including, without limitation, the
legal fees and expenses of the Agent) required to be paid to the Lender Parties
or the Agent on or before the Effective Date, including, without limitation,
those referred to in Sections 2.4, 2.17 and 10.4, to the extent then due and
payable, shall have been paid.
(c) Nothing contained in any public disclosure made by the
Borrower or any of its Subsidiaries shall lead any Lender Party, in its sole
judgment, exercised reasonably, to determine that any Loan Party's or any of its
Subsidiaries' condition (financial or otherwise), operations, performance,
properties or prospects is different in any material and adverse respect from
that contained in public filings since January 1, 1994, except to the extent
that subsequent filings have updated, amended or supplemented such information
(and other documents delivered to the Agent prior to the date hereof) of any
Loan Party or its Subsidiaries prior to such date.
(d) No Lender Party, in its sole judgment, exercised
reasonably, shall have determined that there is any claim, action, suit,
investigation, litigation or proceeding (including, without limitation,
shareholder or derivative litigation) pending or threatened against any Loan
Party in any court or before any arbitrator or Governmental Authority which, if
adversely determined, would have a Material Adverse Effect.
(e) Each Lender Party shall be satisfied, in its sole
judgment, exercised reasonably, with all tax aspects of the transactions
contemplated hereby, and with the corporate, capital, tax, legal and management
structure of the Loan Parties and their Subsidiaries, and shall be satisfied, in
its sole judgment exercised reasonably, with the nature and status of all
Contractual Obligations, securities, labor, tax, ERISA, employee benefit,
environmental, health and safety matters, in each case, involving or affecting
any Loan Party or any of its Subsidiaries.
(f) The Tangible Net Worth of the Borrower as of the Effective
Date is at least $255,000,000 and the Consolidated Tangible Net Worth of the
Loan Party Consolidated Group as of the Effective Date is at least $355,000,000.
3.3. Conditions Precedent to Each Loan and Letter of Credit.
The obligation of each Lender to make any Loan or of each Issuer to issue any
Letter of Credit shall be subject to the further conditions precedent that:
(a) The following statements shall be true on the date of such
Loan or issuance, before and after giving effect thereto and to the application
of the proceeds therefrom and to such issuance (and the acceptance by the
Borrower of the proceeds of such Loan or of the issuance by such Issuer of such
Letter of Credit shall
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constitute a representation and warranty by the Borrower that on the date of
such Loan or issuance such statements are true):
(i) The representations and warranties of the Borrower
contained in Article IV and of each Loan Party in the other Loan
Documents are correct on and as of such date as though made on and as
of such date except insofar as such representations and warranties
speak only as of a prior date or reflect transactions and events after
the Effective Date permitted by the Loan Documents; and
(ii) No Default or Event of Default has occurred and is
continuing or would result from the Loans being made or any Letter of
Credit being issued on such date.
(b) The making of the Loans or the issuance of such Letter of
Credit on such date does not violate any Requirement of Law and is not enjoined,
temporarily, preliminarily or permanently.
(c) No Revolving Credit Loans shall be made if any Swing Loans
are outstanding unless the proceeds of such Revolving Credit Loans are being
used to repay in full the Swing Loans or the Swing Bank otherwise consents.
(d) The Agent shall have received such additional documents,
information and materials as any Lender Party, through the Agent, may reasonably
request.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
To induce the Lender Parties and the Agent to enter into this
Agreement, the Borrower represents and warrants to the Lender Parties and the
Agent that:
4.1. Corporate Existence; Compliance with Law. Each Loan Party
and each of its Subsidiaries (i) is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation; (ii) is duly qualified or licensed as a foreign corporation and
in good standing under the laws of each jurisdiction in which it is required to
so qualify or be licensed, except for failures which in the aggregate would have
no Material Adverse Effect; (iii) has all requisite corporate power and
authority and the legal right to own, pledge, mortgage and operate its
properties, to lease the property it operates under lease and to conduct its
business as now or currently proposed to be conducted; (iv) is in compliance
with
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its certificate of incorporation and by-laws; (v) is in compliance with all
other applicable Requirements of Law, except for such non-compliances as would
in the aggregate have no Material Adverse Effect; and (vi) except as disclosed
on Schedule 4.19, has all necessary licenses, permits, consents or approvals
from or by, has made all necessary filings with, and has given all necessary
notices to, each Governmental Authority having jurisdiction, to the extent
required for such ownership, operation and conduct, except for licenses,
permits, consents or approvals which can be obtained by the taking of
ministerial action to secure the grant or transfer thereof or failures which, in
the aggregate would have no Material Adverse Effect.
4.2. Corporate Power; Authorization; Enforceable Obligations.
(a) The execution, delivery and performance by each Loan Party of the Loan
Documents to which it is a party and the consummation of the transactions
related to the financing contemplated hereby:
(i) are within such Loan Party's corporate powers;
(ii) have been duly authorized by all necessary corporate
action, including, without limitation, the consent of stockholders
where required; and
(iii) do not (A) contravene any Loan Party's or any of its
Subsidiaries' respective certificates of incorporation or by-laws or
other comparable governing documents, (B) as to any Loan Party, violate
any other applicable Requirement of Law (including, without limitation,
Regulations G, T, U and X of the Board of Governors of the Federal
Reserve System), or any order or decree of any Governmental Authority
or arbitrator, (C) conflict with or result in the breach of, or
constitute a default under, or result in or permit the termination or
acceleration of, any Material Contractual Obligation of any Loan Party
or any of its Subsidiaries, or (D) result in the creation or imposition
of any Lien upon any of the property of any Loan Party or any of its
Subsidiaries, other than those in favor of the Agent pursuant to the
Collateral Documents.
(b) No authorization by, approval of, notice to, or filing or
registration with, any Governmental Authority or any other Person, other than
those which have been obtained or made and copies of which in the case of those
involving a Governmental Authority have been delivered to the Agent, is required
for (i) the due execution, delivery, recordation, filing or performance by any
Loan Party of this Agreement, the Revolving Credit Notes or any other Loan
Document to which it is or is to be a party, or for the consummation of the
transactions contemplated hereby, (ii) the grant by any Loan Party of the Liens
granted by it pursuant to the Collateral Documents, (iii) the perfection or
maintenance of the Liens created by the Collateral Documents (including, as of
the Effective Date, the first priority nature thereof (subject to Permitted
Liens)) or (iv) the exercise by the Agent or any Lender Party of
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its rights under the Loan Documents or the remedies in respect of the Collateral
pursuant to the Collateral Documents. On any date after the Effective Date, no
authorization by, approval of, notice to, or filing or registration with, any
Governmental Authority or any other Person, other than those which have been (x)
obtained or made and copies of which in the case of those involving a
Governmental Authority have been delivered to the Agent or (y) disclosed to the
Agent in accordance with Section 6.11(n), is required for the perfection or
maintenance of the Liens created by the Collateral Documents (including the
first priority thereof (subject to Permitted Liens)).
(c) This Agreement has been and each of the other Loan
Documents will have been upon delivery thereof pursuant to Section 3.1, duly
executed and delivered by each Loan Party party thereto. This Agreement is, and
each other Loan Document will be when delivered hereunder, the legal, valid and
binding obligation of each Loan Party party thereto, enforceable against it in
accordance with its terms subject to applicable bankruptcy, insolvency,
moratorium or similar laws affecting creditors' rights generally and to general
principles of equity regardless of whether enforcement is sought in a proceeding
in equity or at law.
4.3. Taxes. All federal, and all material state, local and
foreign tax returns, reports and statements (collectively, the "Tax Returns")
required to be filed by any Loan Party or any of their Tax Affiliates have been
filed with the appropriate governmental agencies in all jurisdictions in which
such Tax Returns are required to be filed, and all taxes, charges and other
impositions due and payable have been timely paid prior to the date on which any
fine, penalty, interest, late charge or loss may be added thereto for
non-payment thereof, except where contested in good faith and by appropriate
proceedings if adequate reserves therefor have been established on the books of
such Loan Party or such Tax Affiliate in accordance with GAAP and all such
non-payments, in the aggregate, if adversely determined would have no Material
Adverse Effect. Proper and accurate amounts have been withheld by each Loan
Party and each of their Tax Affiliates from their respective employees for all
periods in material compliance with the tax, social security and unemployment
withholding provisions of applicable federal, state, local and foreign law and
such withholdings have been timely paid to the respective Governmental
Authorities. No Loan Party or any of their Tax Affiliates has (i) except as set
forth on Schedule 4.3, executed or filed with the IRS or any other Governmental
Authority any agreement or other document (which agreement or other document is
presently in effect) extending, or having the effect of extending, the period
for assessment or collection of any charges, or agreed or been requested to make
any adjustment under Section 481(a) of the Code by reason of a change in
accounting method or otherwise which will result in any material aggregate tax
liability for the three taxable years beginning with the year of adjustment; or
(ii) except as set forth on Schedule 4.3, any obligation under any written or
oral tax sharing agreement other than the Tax Sharing Agreement.
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4.4. Full Disclosure. No written statement prepared or
furnished by or on behalf of any Loan Party or any of its Affiliates in
connection with any of the Loan Documents or the consummation of the
transactions contemplated thereby, and no financial statement delivered pursuant
hereto or thereto, contains any untrue statement of a material fact or omits to
state a material fact necessary to make the statements contained herein or
therein not misleading, if, in either case, such fact is material to an
understanding of the financial condition, business, properties or prospects of
any Loan Party or any of its Affiliates or the ability of such Persons to
fulfill its obligations under any Loan Document to which it is a party.
4.5. Financial Matters. (a) The Consolidated balance sheet of
WHX and its Consolidated Subsidiaries as at December 31, 1994, and the related
Consolidated statements of income, retained earnings and cash flow of WHX and
its Subsidiaries for the fiscal year then ended, certified by Price Waterhouse,
and the Consolidated balance sheet of the Loan Party Consolidated Group as at
September 30, 1995, and the related Consolidated statements of income, retained
earnings and cash flow of the Loan Party Consolidated Group for the nine months
then ended, duly certified by the chief financial officer of Holdings, copies of
which have been furnished to each Lender Party, fairly present, subject, in the
case of said balance sheets as at September 30, 1995, and said statements of
income and cash flow for the nine months then ended, to year-end audit
adjustments, the Consolidated financial condition of such Person and its
Subsidiaries as at such dates and the Consolidated results of the operations of
such Person and its Subsidiaries for the period ended on such date, all in
conformity with GAAP.
(b) Since December 31, 1994 and through the Effective Date,
there has been no Material Adverse Change and there have been no events or
developments that in the aggregate have had a Material Adverse Effect.
(c) None of the Loan Parties or any of its Subsidiaries had at
December 31, 1994 any material obligation, contingent liability or liability for
taxes, long-term leases or unusual forward or long-term commitment that is
required by GAAP to be included in a balance sheet which is not reflected in the
balance sheet referred to in subsection (a) above or in the notes thereto (other
than in connection with the Receivables Securitization).
(d) As of the Effective Date, each Loan Party is, and each
Loan Party and its Subsidiaries are, on a consolidated basis, Solvent.
(e) The unaudited pro forma consolidated balance sheet of the
Borrower and its Consolidated Subsidiaries, a copy of which has been delivered
to each Lender Party, has been prepared as of December 31, 1995 and reflects as
of such date, on a pro forma basis, the projected Consolidated financial
condition of the Borrower and its Subsidiaries. Such pro forma financial
statements (including any
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related schedules and notes) have been prepared in accordance with GAAP on the
basis of the statements and assumptions set forth in the respective notes
thereto. The Projections and assumptions expressed therein were reasonably based
on the information available to the Borrower at the time so furnished and on the
Effective Date, including, without limitation, the DRI/McGraw Hill Steel
Industry Review 3rd Quarter 1995. The Lender Parties hereby acknowledge as
reasonable the economic forecast contained in such Industry Review and the Loan
Party Consolidated Group's reliance thereon.
4.6. Litigation. Except as set forth in Schedule 4.6, there
are no pending or, to the knowledge of the Borrower, threatened actions,
investigations or proceedings affecting any Loan Party or any of its
Subsidiaries before any Governmental Authority or arbitrator which, in the
aggregate, would have a Material Adverse Effect. The performance of any action
by any Loan Party required or contemplated by any of the Loan Documents is not
restrained or enjoined (either temporarily, preliminarily or permanently), and
no material adverse condition has been imposed by any Governmental Authority or
arbitrator upon any of the foregoing transactions.
4.7. Margin Regulations. No Loan Party is engaged in the
business of extending credit for the purpose of purchasing or carrying margin
stock (within the meaning of Regulation U issued by the Board of Governors of
the Federal Reserve System), and no proceeds of any Borrowing will be used to
purchase or carry any margin stock or to extend credit to others for the purpose
of purchasing or carrying any margin stock in contravention of Regulation G, T,
U or X of the Board of Governors of the Federal Reserve System.
4.8. Ownership of the Borrower and Subsidiaries. (a) Set forth
on Schedule 4.8 hereto as may be supplemented from time to time pursuant to
Section 6.11(n), is a complete and accurate list showing, as to the Borrower and
each Guarantor, the jurisdiction of its incorporation, the number of shares of
each class of Stock authorized, the number outstanding on the date hereof and
the ownership of the outstanding shares of each class. No authorized but
unissued shares, no treasury shares and, to the best knowledge of the Borrower
and each Guarantor, no other outstanding shares of capital stock of the Borrower
or such Guarantor are subject to any option, warrant, right of conversion or
purchase or any similar right. There are no agreements or understandings with
respect to the voting, sale or transfer of any shares of capital stock of the
Borrower or any Guarantor or, to the best knowledge of the Borrower or such
Guarantor, any agreement restricting the transfer or hypothecation of any such
shares, except, in the case of the Borrower, for the USWA Right of First Refusal
and, in the case of PCC and Wheeling Construction, under the Holdings Pledge
Agreement.
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(b) Set forth on Schedule 4.8 hereto, as may be supplemented from time to time
pursuant to Section 6.11(n), is a complete and accurate list showing all direct
and indirect Subsidiaries of the Borrower and, as to each such Subsidiary, the
jurisdiction of its incorporation, the number of shares of each class of Stock
authorized, the number outstanding on the date hereof and the percentage of the
outstanding shares of each such class owned (directly or indirectly) by the
Borrower. No Stock of any Subsidiary of the Borrower is subject to any
outstanding option, warrant, right of conversion or purchase or any similar
right. All of the outstanding Stock of each such Subsidiary has been validly
issued, is fully paid and non-assessable and is owned by the Borrower, free and
clear of all Liens other than the Liens granted to the Agent pursuant to the
Borrower Security Agreement. Neither the Borrower nor any such Subsidiary is a
party to, or has knowledge of, any agreement restricting the transfer or
hypothecation of any Stock of any such Subsidiary. The Borrower does not own or
hold, directly or indirectly, any capital stock or equity security of, or any
equity interest in, any Person other than such Subsidiaries.
4.9. ERISA. (a) Schedule 4.9 separately identifies, as of the
Effective Date, all Plans, all Qualified Plans, all Title IV Plans, all
Multiemployer Plans, all unfunded Pension Plans and all Welfare Benefit Plans
that provide retiree benefits.
(b) Except as set forth on Schedule 4.9, as may be
supplemented from time to time pursuant to Section 6.11(n), each Qualified Plan
has been determined by the IRS to qualify under Section 401 of the Code, and the
trusts created thereunder have been determined to be exempt from tax under the
provisions of Section 501 of the Code, and to the best knowledge of the
Borrower, nothing has occurred which would cause the loss of such qualification
or tax-exempt status.
(c) Except as set forth on Schedule 4.9, as may be
supplemented from time to time pursuant to Section 6.11(n), each Plan is in
compliance in all material respects with applicable provisions of ERISA and the
Code, including, without limitation, the filing of reports required under the
Code or ERISA which are true and correct in all material respects as of the date
filed, and, with respect to each Plan (other than a Qualified Plan), all
required contributions and benefits have been paid in accordance with the
provisions of each such Plan.
(d) No Loan Party or any of its Subsidiaries or any ERISA
Affiliate, with respect to any Qualified Plan, has failed to make any
contribution or pay any amount due as required by Section 412 of the Code or
Section 302 of ERISA or the terms of any such Qualified Plan.
(e) Except as set forth on Schedule 4.9, as may be
supplemented from time to time pursuant to Section 6.11(n), there has been no,
nor is there reasonably expected to occur any, ERISA Event or event described in
Section 4068 of ERISA with respect to any Title IV Plan.
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(f) Except as set forth on Schedule 4.9, as may be
supplemented from time to time pursuant to Section 6.11(n), there are no pending
or, to the knowledge of the Borrower, threatened claims, actions or lawsuits
(other than claims for benefits in the normal course), asserted or instituted
against (i) any Plan or its assets, (ii) any fiduciary with respect to any Plan
or (iii) any Loan Party, any of its Subsidiaries or any ERISA Affiliate with
respect to any Plan.
(g) Except as set forth on Schedule 4.9, as may be
supplemented from time to time pursuant to Section 6.11(n), none of the
Borrower, any of its Subsidiaries or any ERISA Affiliate has incurred, or has
any reasonable likelihood of incurring, any Withdrawal Liability under Section
4201 of ERISA as a result of a complete or partial withdrawal from a
Multiemployer Plan (and no event has occurred which, with the giving of notice
under Section 4219 of ERISA, would result in any such liability).
(h) Except as set forth on Schedule 4.9, as may be
supplemented from time to time pursuant to Section 6.11(n), within the last five
years none of any Loan Party, any of its Subsidiaries or any ERISA Affiliate has
engaged in a transaction which resulted in a Title IV Plan with Unfunded Pension
Liabilities being transferred outside of the "controlled group" (within the
meaning of Section 4001(a)(14) of ERISA) of any such entity.
4.10. Liens. There are no Liens of any nature whatsoever on
any properties of any Loan Party or any of their Subsidiaries other than those
permitted by Section 7.1 and as described on Schedule 4.10, as may be
supplemented from time to time pursuant to Section 6.11(n). The Liens granted by
the Loan Parties to the Agent pursuant to the Collateral Documents are fully
perfected first priority Liens in and to the Collateral (subject to Permitted
Liens).
4.11. First Mortgage Notes; Permanent Financing Notes. No
Indenture has been amended or modified in any respect and no provision therein
has been waived and no event has occurred or condition exists under the First
Mortgage Notes or the Permanent Financing Notes, the effect of such event or
condition is to accelerate or permit the acceleration of, the maturity of the
First Mortgage Notes or the Permanent Financing Notes.
4.12. No Burdensome Restrictions; No Defaults. (a) No Loan
Party or any of its Subsidiaries (i) is a party to any Contractual Obligation
which would have a Material Adverse Effect or the performance of which by any
thereof, either unconditionally or upon the happening of an event, will result
in the creation of a Lien (other than a Lien permitted by Section 7.1) on the
property or assets of any thereof, (ii) is subject to a charter or corporate
restriction that would have a Material Adverse Effect, or (iii) is, to the
knowledge of the Borrower, in default (except a non-payment default on any of
the First Mortgage Notes or the Permanent Financing
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Notes, the effect of which is not to accelerate or permit the acceleration of
the maturity of any of the First Mortgage Notes or the Permanent Financing
Notes) under or with respect to any Contractual Obligation other than those
defaults which in the aggregate would have no Material Adverse Effect.
(b) No Event of Default has occurred and is continuing.
(c) No Requirement of Law has a Material Adverse Effect.
(d) Except as provided in the Indentures, none of the Loan
Parties' Subsidiaries is subject to any restriction or limitation on its ability
to declare or make any dividend payment or other distribution on account of any
shares of any class of its Stock or on its ability to purchase, redeem, or
otherwise acquire for value or make any payment in respect of any such shares or
any shareholder rights.
4.13. No Other Ventures. Except as listed on Schedule 4.13, as
may be supplemented from time to time pursuant to Section 6.11(n), or otherwise
permitted under Section 7.6, no Loan Party or any of its Subsidiaries is engaged
in any joint venture or partnership with any other Person.
4.14. Investment Company Act. The Borrower is not an
"investment company" or an "affiliated person" of, or "promoter" or "principal
underwriter" for, an "investment company", as such terms are defined in the
Investment Company Act of 1940, as amended. The making of the Loans and the
issuance of the Letters of Credit by the Lender Parties, the application of the
proceeds and repayment thereof by the Borrower and the consummation of the
transactions contemplated by the Loan Documents on the part of any Loan Party
will not violate any provision of such Act or any rule, regulation or order
issued by the Securities and Exchange Commission thereunder.
4.15. Insurance. As of the Effective Date, all policies of
insurance of any kind or nature owned by or issued to any Loan Party or any of
its Subsidiaries, including, without limitation, policies of life, fire, theft,
product liability, public liability, property damage, other casualty, employee
fidelity, workers' compensation, employee health and welfare, title and property
insurance, are in full force and effect and are of a nature and provide such
coverage as is sufficient and as is customarily carried by companies of the size
and character of the Borrower and its Subsidiaries.
4.16. Labor Matters. (a) Except as set forth on Schedule 4.16,
there are no strikes, work stoppages, slowdowns or lockouts pending, or
reasonably likely to occur in the immediate future, against or involving any
Loan Party or any of its Subsidiaries, other than those which in the aggregate
would have no Material Adverse Effect.
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(b) Except as set forth on Schedule 4.16, there are no
arbitrations or grievances pending against or involving any Loan Party or any of
its Subsidiaries, nor, to the best knowledge of the Loan Parties and their
Subsidiaries, are there any arbitrations or grievances threatened involving any
Loan Party or any of its Subsidiaries, other than those which in the aggregate
would have no Material Adverse Effect.
(c) Except as set forth on Schedule 4.16, as of the Effective
Date, no Loan Party or any of its Subsidiaries are parties to, or have any
obligations under, any collective bargaining agreement.
(d) Except as set forth on Schedule 4.16, as of the Effective
Date, there are no representation proceedings pending or, to the best knowledge
of the Borrower, threatened with the National Labor Relations Board, and no
labor organization or group of employees of any Loan Party or any of its
Subsidiaries have made a pending demand for recognition.
(e) There are no unfair labor practice charges, grievances or
complaints pending or in process or, to the best knowledge of the Borrower,
threatened by or on behalf of any employee or group of employees of any Loan
Party or any of its Subsidiaries other than those which in the aggregate would
have no Material Adverse Effect.
(f) Except as set forth on Schedule 4.16, there are no
complaints or charges against any Loan Party or any of its Subsidiaries pending
or, to the best knowledge of the Borrower, threatened to be filed with any
Governmental Authority or arbitrator based on, arising out of, in connection
with, or otherwise relating to the employment by any Loan Party or any of its
Subsidiaries of any individual, other than those which in the aggregate would
have no Material Adverse Effect.
(g) Each Loan Party and each of its Subsidiaries are in
compliance with all laws, and all orders of any court, governmental agency or
arbitrator, relating to the employment of labor, including all such laws
relating to wages, hours, collective bargaining, discrimination, civil rights,
and the payment of withholding and/or social security and similar taxes, other
than such non-compliances as in the aggregate would have no Material Adverse
Effect.
4.17. Force Majeure. Neither the business nor the properties
of any Loan Party or any of its Subsidiaries is currently suffering from the
effects of any fire, explosion, accident, drought, storm, hail, earthquake,
embargo, act of God or of the public enemy or other casualty (whether or not
covered by insurance) other than those which in the aggregate would have no
Material Adverse Effect.
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4.18. Use of Proceeds. The proceeds of the Loans and the
Letters of Credit are being used solely (i) for the payment of related
transaction costs, fees and expenses and (ii) for general working capital
purposes and other general corporate purposes of the Loan Parties, including,
without limitation, Investments permitted under Section 7.6.
4.19. Environmental Protection. Except as disclosed on
Schedule 4.19:
(a) The operations of each Loan Party and each of its
Subsidiaries or tenants comply with all Environmental Laws, other than such
non-compliance as in the aggregate would have no Material Adverse Effect;
(b) Each Loan Party and each of its Subsidiaries have obtained
all environmental, health and safety Permits necessary for their operations
other than those failures which in the aggregate would have no Material Adverse
Effect, and all such Permits are in good standing, except where such failure
would have no Material Adverse Effect, and each Loan Party and each of its
Subsidiaries are in compliance with the terms and conditions of such Permits
other than for such non-compliance which in the aggregate would have no Material
Adverse Effect;
(c) Neither any Loan Party nor any of its Subsidiaries have
any currently or previously owned or leased property or operations subject to
any threatened or outstanding order from or agreement with any Governmental
Authority or other Person or subject to any judicial or docketed administrative
proceeding respecting (i) Environmental Laws, (ii) Remedial Action or (iii)
Environmental Liabilities and Costs, other than those which in the aggregate
would have no Material Adverse Effect;
(d) As of the Effective Date, no Loan Party and none of their
Subsidiaries is a treatment, storage or disposal facility requiring a permit
under the Resource Conservation and Recovery Act, 42 U.S.C. ss. 6901 et seq.,
the regulations thereunder or any state analog and, as of the Effective Date,
each Loan Party and each of its Subsidiaries is in compliance with all
applicable financial responsibility requirements of all Environmental Laws,
including, without limitation, those contained in 40 C.F.R., parts 264, 265 and
280, subparts H, and any state equivalents, other than those that in the
aggregate would have no Material Adverse Effect;
(e) No Loan Party and none of their Subsidiaries has filed or
failed to file any notice required under any applicable Environmental Law
reporting a Release other than those which in the aggregate would have no
Material Adverse Effect;
(f) There are not now nor have there been in the past any
events, conditions or circumstances associated with or arising from currently
owned or leased
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properties or current operations of any Loan Party or any of its Subsidiaries
or, to the best of the Borrower's knowledge, tenants or, to the best of the
Borrower's knowledge, any events, conditions or circumstances associated with or
arising from any previously owned or leased properties or the previous
operations of any Loan Party or any of its Subsidiaries or, to the best of the
Borrower's knowledge, tenants, which may give rise to any Environmental
Liabilities and Costs other than those in the aggregate that would have no
Material Adverse Effect. There are not now nor have there been in the past, any
events, conditions or circumstances with or arising from currently or previously
owned or leased properties or current or previous operations of any Loan Party
or any of its Subsidiaries or, to the best of the Borrower's knowledge, tenants,
which may give rise to Environmental Costs and Liabilities other than those
which in the aggregate would have no Material Adverse Effect;
(g) As of the Effective Date, no Environmental Lien and no
unrecorded Environmental Lien has attached to any property of any Loan Party or
any of its Subsidiaries and, as of any date after the Effective Date, no
Environmental Lien and no unrecorded Environmental Lien has attached to any
property of any Loan Party or any of its Subsidiaries other than those that in
the aggregate would have no Material Adverse Effect; and
(h) With respect to any property owned, leased or operated by
any Loan Party or any of its Subsidiaries: (i) there are no underground storage
tanks or surface impoundments, (ii) except to the extent that the presence
thereof, in the aggregate, would not have a Material Adverse Effect, there is
not any asbestos-containing material in friable form or any airborne asbestos
containing material in excess of amounts proscribed by Environmental Laws, or
(iii) there is not any polychlorinated biphenyls ("PCBs") other than those used,
maintained or disposed of in compliance with all applicable Environmental Laws
or the removal of which would have a Material Adverse Effect.
4.20. Intellectual Property. The Loan Parties and their
Subsidiaries own or license or otherwise have the right to use all material
licenses, permits, patents, patent applications, trademarks, trademark
applications, service marks, trade names, copyrights, copyright applications,
franchises, authorizations and other intellectual property rights that are
necessary for the operation of their respective businesses, without infringement
upon or conflict with the rights of any other Person with respect thereto,
including, without limitation, all trade names, except where such failure would
have no Material Adverse Effect. To the best knowledge of the Borrower, no
slogan or other advertising device, product, process, method, substance, part or
other material now employed, or now contemplated to be employed, by any Loan
Party or any of its Subsidiaries infringes upon or conflicts with any rights
owned by any other Person, and no claim or litigation regarding any of the
foregoing is pending or threatened, other than those which in the aggregate
would have no
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Material Adverse Effect. No patent, invention, device, application, principle or
any statute, law, rule, regulation, standard or code relating thereto is pending
or, to the knowledge of the Borrower, proposed, other than those the
consequences of which, in the aggregate would have no Material Adverse Effect.
4.21. Title. (a) The Loan Parties and their Subsidiaries own
fee simple absolute title to all of the Real Estate described in Schedule
4.21(a), as may be supplemented from time to time pursuant to Section 6.11(n),
and marketable title to, or valid leasehold interests pursuant to the Leases in,
all other properties and assets purported to be owned by any Loan Party or any
of their Subsidiaries, including, without limitation, valid leasehold interests
pursuant to the Leases and all property reflected in the balance sheet referred
to in Section 4.5(a), except for such failures which in the aggregate would have
no Material Adverse Effect. None of such properties and assets, including,
without limitation, the Real Estate and the Leases, is subject to any Lien,
except Liens permitted hereunder. The Loan Parties and their Subsidiaries have
received all deeds, assignments, waivers, consents, non-disturbance and
recognition or similar agreements, bills of sale and other documents, and have
duly effected all recordings, filings and other actions necessary to establish,
protect and perfect such Loan Parties and its Subsidiaries' right, title and
interest in and to all such property except for such failures which would in the
aggregate have no Material Adverse Effect.
(b) All real property leased, with an annual base rent of at
least $100,000, at the date of this Agreement by any Loan Party or any of its
Subsidiaries is listed on Schedule 4.21(b), as may be supplemented from time to
time pursuant to Section 6.11(n), setting forth information regarding the
commencement date, termination date, renewal options and purchase options (if
any) and annual base rents as specified therein. Each of such leases is valid
and enforceable in accordance with its terms and is in full force and effect
other than those leases which if not valid and enforceable, would in the
aggregate have no Material Adverse Effect. None of any Loan Party or any of its
Subsidiaries or, to the knowledge of the Borrower, any other party to any such
lease is in default of its obligations thereunder or has delivered or received
any notice of default under any such lease and no event has occurred which, with
the giving of notice, the passage of time or both, would constitute a default
under any such lease, except, in either case, for defaults the consequence of
which in the aggregate would have no Material Adverse Effect.
(c) Except as listed on Schedule 4.21(c), as may be
supplemented from time to time pursuant to Section 6.11(n), neither any Loan
Party nor any of its Subsidiaries owns or holds, or is obligated under or a
party to, any option, right of first refusal or other contractual right to
purchase, acquire, sell, assign or dispose of any real property owned or leased
by such Loan Party or any of its Subsidiaries.
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(d) All components of all improvements included within the
real property owned or leased by any Loan Party or any of its Subsidiaries
(collectively, "Improvements"), including, without limitation, the roofs and
structural elements thereof and the heating, ventilation, air conditioning,
plumbing, electrical, mechanical, sewer, waste water, storm water, paving and
parking equipment, systems and facilities included therein, are in good working
order and repair other than such failures the consequences of which in the
aggregate would have no Material Adverse Effect. All water, gas, electrical,
steam, compressed air, telecommunication, sanitary and storm sewage lines and
systems and other similar systems serving the real property owned or leased by
any Loan Party or any of its Subsidiaries are installed and operating and are
sufficient to enable the real property owned or leased by such Loan Party and
its Subsidiaries to continue to be used and operated in the manner currently
being used and operated other than such failures which in the aggregate would
have no Material Adverse Effect, and neither any Loan Party nor any of its
Subsidiaries has any knowledge of any fact or condition that could result in the
termination or material impairment of the furnishing thereof, other than such
failures which in the aggregate would have no Material Adverse Effect. No
Improvement or portion thereof is dependent for its access, operation or utility
on any land, building or other Improvement not included in the real property
owned or leased by any Loan Party or any of its Subsidiaries except where the
consequences of such in the aggregate would have no Material Adverse Effect.
(e) All Permits required to have been issued or appropriate to
enable all real property owned or leased by any Loan Party or any of its
Subsidiaries to be lawfully occupied and used for all of the purposes for which
they are currently occupied and used, have been lawfully issued and are in full
force and effect, other than such failures the consequences of which in the
aggregate would have no Material Adverse Effect.
(f) Neither any Loan Party nor any of its Subsidiaries has
received any notice, nor has any knowledge, of any pending, threatened or
contemplated condemnation proceeding affecting any real property owned or leased
by such Loan Party or any of its Subsidiaries or any part thereof, or any
proposed termination or impairment of any parking at any such owned or leased
real property or of any sale or other disposition of any real property owned or
leased by such Loan Party or any of its Subsidiaries or any part thereof in lieu
of condemnation, except for notices affecting real property which in the
aggregate, if lost, would have no Material Adverse Effect.
(g) No portion of any real property owned or leased by any
Loan Party or any of its Subsidiaries has suffered any material damage by fire
or other casualty loss which has not heretofore been completely replaced,
repaired and restored to its original condition, except to the extent that the
failure to replace, repair or restore such real property would in the aggregate
have no Material Adverse Effect.
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ARTICLE V
FINANCIAL COVENANTS
As long as any of the Obligations or the Revolving Credit
Commitments remain outstanding, unless the Majority Lenders otherwise consent in
writing:
5.1. Maintenance of Tangible Net Worth. The Loan Party
Consolidated Group shall maintain for each Fiscal Quarter ending on the dates
set forth below a Tangible Net Worth of the Loan Party Consolidated Group of not
less than the minimum amount set forth below for such period:
For the Period Ending Minimum Required Amount
--------------------- -----------------------
December 31, 1995 $328,000,000
March 31, 1996 325,000,000
June 30, 1996 325,000,000
September 30, 1996 320,000,000
December 31, 1996 317,000,000
March 31, 1997 310,000,000
June 30, 1997 305,000,000
September 30, 1997 300,000,000
December 31, 1997 291,000,000
March 31, 1998 290,000,000
June 30, 1998 290,000,000
September 30, 1998 290,000,000
December 31, 1998 289,000,000
March 31, 1999 289,000,000
June 30, 1999 289,000,000
and thereafter
5.2. Maintenance of Leverage Ratio. The Loan Party
Consolidated Group shall maintain for each month included in each Fiscal Quarter
set forth below, a ratio of (a) the sum of Total Liabilities minus pension plan
liabilities (in each case, of the Loan Party Consolidated Group) plus the
aggregate "Trust Invested Amount" (under and as defined in the Securitization
Documents) to (b) Tangible Net Worth of the Loan Party Consolidated Group, not
more than the ratio set forth below for such period:
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For the Period Ending Maximum Leverage Ratio
--------------------- ----------------------
December 31, 1995 3.25: 1.00
March 31, 1996 3.25: 1.00
June 30, 1996 3.30: 1.00
September 30, 1996 3.30: 1.00
December 31, 1996 3.35: 1.00
March 31, 1997 3.50: 1.00
June 30, 1997 3.65: 1.00
September 30, 1997 3.80: 1.00
December 31, 1997 3.90: 1.00
March 31, 1998 3.90: 1.00
June 30, 1998 4.00: 1.00
September 30, 1998 4.00: 1.00
December 31, 1998 4.00: 1.00
March 31, 1999 4.00: 1.00
June 30, 1999 4.00: 1.00
and thereafter
5.3. Maintenance of Interest Coverage Ratio. The Loan Party
Consolidated Group shall maintain for each Fiscal Quarter an Interest Coverage
Ratio for such period not less than the ratio set forth below:
For the Fiscal Minimum Ratio
Quarter Ending Required
-------------- --------
December 31, 1995 4.00:1.00
March 31, 1996 3.25:1.00
June 30, 1996 3.25:1.00
September 30, 1996 3.00:1.00
December 31, 1996 2.85:1.00
March 31, 1997 2.50:1.00
June 30, 1997 2.25:1.00
September 30, 1997 2.00:1.00
December 31, 1997 1.83:1.00
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March 31, 1998 2.00:1.00
June 30, 1998 2.25:1.00
September 30, 1998 2.45:1.00
December 31, 1998 2.74:1.00
March 31, 1999 2.80:1.00
June 30, 1999 2.80:1.00
and thereafter
5.4. Maintenance of Cumulative Cash Flow. The Loan Party
Consolidated Group shall maintain for each month included in each Fiscal Quarter
set forth below, Cumulative Cash Flow for the period beginning on January 1,
1995 and ending on the date of determination of not less than the amount set
forth below:
Minimum
For the Period Ending Required Amount
--------------------- ---------------
March 31, 1996 $(45,000,000)
June 30, 1996 (55,000,000)
September 30, 1996 (65,000,000)
December 31, 1996 (75,000,000)
March 31, 1997 (85,000,000)
June 30, 1997 (95,000,000)
September 30, 1997 (100,000,000)
December 31, 1997 (100,000,000)
March 31, 1998 (110,000,000)
June 30, 1998 (115,000,000)
September 30, 1998 (120,000,000)
December 31, 1998 (120,000,000)
March 31, 1999 (120,000,000)
June 30, 1999 (120,000,000)
and thereafter
5.5. Limitation on Capital Expenditures. The Loan Party
Consolidated Group shall not make, or permit any of their Subsidiaries to make,
Capital Expenditures for the period from January 1, 1996 through the last day of
each month included in each Fiscal Quarter set forth below in excess of the
amount set forth opposite such date:
Maximum Amount of
For the Period Ending Capital Expenditures
--------------------- --------------------
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March 31, 1996 $ 30,000,000
June 30, 1996 60,000,000
September 30, 1996 80,000,000
December 31, 1996 80,000,000
March 31, 1997 110,000,000
June 30, 1997 140,000,000
September 30, 1997 160,000,000
December 31, 1997 170,000,000
March 31, 1998 200,000,000
June 30, 1998 230,000,000
September 30, 1998 250,000,000
December 31, 1998 260,000,000
March 31, 1999 280,000,000
and thereafter
ARTICLE VI
ADDITIONAL AFFIRMATIVE COVENANTS
As long as any of the Obligations or the Revolving Credit
Commitments remain outstanding, unless the Majority Lenders otherwise consent in
writing:
6.1. Compliance with Laws, Etc. The Loan Parties shall comply,
and shall cause each of their Subsidiaries to comply, with all Requirements of
Law, Contractual Obligations, commitments, instruments, licenses, permits and
franchises, including, without limitation, all Permits, other than such
non-compliances the consequences of which in the aggregate would have no
Material Adverse Effect.
6.2. Conduct of Business. The Loan Parties shall (a) conduct,
and shall cause each of their Subsidiaries to conduct, its business in a regular
manner consistent with sound business practice in such Loan Party's or such
Subsidiary's industry; (b) use, and cause each of their Subsidiaries to use, its
reasonable efforts, in the ordinary course and consistent with past practice, to
preserve its business and the goodwill and business of the customers,
advertisers, suppliers and others having business relations with any Loan Party
or any of their Subsidiaries; (c) preserve, and cause each of their Subsidiaries
to preserve, all registered patents, trademarks, trade names, copyrights and
service marks necessary for the conduct of its business; and (d) perform and
observe, and cause each of their Subsidiaries to perform and observe, all the
terms, covenants and conditions required to be performed and observed by it
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under its Contractual Obligations (including, without limitation, to pay all
rent and other charges payable under any lease and to pay all other payables and
obligations as they become due), and do, and cause their Subsidiaries to do, all
things necessary to preserve and to keep unimpaired its rights under such
Contractual Obligations, other than, in the case of (a) through (d), such
failures the consequences of which in the aggregate would have no Material
Adverse Effect.
6.3. Payment of Taxes, Etc. The Loan Parties shall pay and
discharge, and shall cause each of their Subsidiaries to pay and discharge,
before the same shall become delinquent, all lawful governmental claims, taxes,
assessments and charges or levies against it or any of its Subsidiaries or for
which its or any of its Subsidiaries assets may be subject, except where
contested in good faith, by proper proceedings, if adequate reserves therefor
have been established on the books of such Loan Party or such Subsidiary in
conformity with GAAP and where the consequence of all such non-payments in the
aggregate would have no Material Adverse Effect. To the extent such claims,
taxes, assessments, charges or levies are computed on a consolidated, combined
or unitary basis, any payments by any Loan Party and its Subsidiaries shall not
exceed their allocable share thereof.
6.4. Maintenance of Insurance. The Loan Parties shall
maintain, and shall cause each of their Subsidiaries to maintain, insurance with
responsible and reputable insurance companies or associations in such amounts
and covering such risks as is usually carried by companies engaged in similar
businesses and owning similar properties in the same general areas in which such
Loan Party or such Subsidiary operates and as otherwise satisfactory to the
Agent, in its sole judgment exercised reasonably, and, in any event, all
insurance required by any Collateral Document. All insurance required by any
Collateral Document shall name the Agent as additional insured or loss payee, as
the Agent shall determine. Each Loan Party will furnish to the Agent (together
with copies for each Lender) from time to time such information as may be
reasonably requested by the Agent as to such insurance.
6.5. Preservation of Corporate Existence, Etc. Each Loan Party
shall preserve and maintain, and shall cause each of their Subsidiaries to
preserve and maintain, its corporate existence and, except for failures which in
the aggregate would have no Material Adverse Effect, all rights (charter and
statutory) and franchises, except as permitted by Section 7.5.
6.6. Access. Each Loan Party shall, at any reasonable time and
from time to time, upon reasonable prior notice, (i) permit the Agent, any
agents and any representatives thereof, to (A) examine and make copies of and
abstracts from the records and books of account of such Loan Party and each of
its Subsidiaries, (B) visit the properties of such Loan Party and each of its
Subsidiaries and (C) communicate directly with such Loan Party's independent
certified public accountants, and (ii) permit the Agent, any agents and any
representatives thereof,
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to discuss the affairs, finances and accounts of such Loan Party each of its
Subsidiaries with any of their respective officers or directors. Each Loan Party
hereby authorizes its independent certified public accountants to disclose to
the Agent, any agents and any representatives thereof, which authorization shall
be confirmed at the request of the Agent, any and all financial statements and
other information of any kind, including, without limitation, to furnish copies
of any management letter, or the substance of any oral information that such
accountants may have with respect to the business, financial condition, results
of operations or other affairs of such Loan Party or any of its Subsidiaries,
except that such accountants shall not be obligated to disclose to the Agent or
any agents and any representatives thereof its work papers or other confidential
information, in each case relating to either (1) any preliminary reports or
studies conducted by such accountants unrelated to any information previously
disclosed to the Agent, any agents or any representatives thereof, (2)
information provided by the attorneys of any Loan Party with respect to
litigation matters if such information is confidential by reason of the
applicable attorney work product doctrine or (3) any reports or communications
concerning the negotiations of the collective bargaining agreements with any
Loan Party's unions at any time prior to the execution of such agreements.
6.7. Keeping of Books. Each Loan Party shall keep, and shall
cause each of its Subsidiaries to keep, proper books of record and account, in
which full and correct entries shall be made of all financial transactions and
the assets and business of such Loan Party and each such Subsidiary in
conformity with GAAP and applicable law, rules and regulations.
6.8. Maintenance of Properties, Etc. Each Loan Party shall
maintain and preserve, and shall cause each of its Subsidiaries to maintain and
preserve, (i) all of its properties which are useful or necessary in the conduct
of its business in good working order and condition, and (ii) all rights,
permits, licenses, approvals and privileges (including, without limitation, all
Permits) which are used or useful or necessary in the conduct of its business,
other than those which the failure to maintain and preserve would in the
aggregate have no Material Adverse Effect.
6.9. Application of Proceeds. The Borrower and the Guarantors
shall use the entire amount of the proceeds of the Loans as provided in Section
4.18.
6.10. Financial Statements. The Loan Parties shall furnish to
the Lender Parties:
(a) as soon as available and in any event within 30 days after
the end of each month, the Consolidated balance sheet without footnotes of the
Loan Party Consolidated Group and the balance sheet without footnotes of the
Borrower as of the end of such month and the Consolidated statements of income
and cash flow of the Loan Party Consolidated Group and the statement of income
and cash flow of the
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Borrower for the period commencing at the end of the previous Fiscal Year and
ending with the end of such month, certified by the chief financial officer of
Holdings as fairly presenting the financial condition and results of operations
of the Loan Party Consolidated Group and the Borrower, respectively, at such
date and for such period subject to normal year end audit adjustments, together
with (A) a certificate of said officer stating that no Default or Event of
Default has occurred and is continuing or, if a Default or an Event of Default
has occurred and is continuing, a statement as to the nature thereof and the
action which the Borrower proposes to take with respect thereto, (B) a schedule
in form satisfactory to the Agent of the computations used by the Borrower in
determining compliance with all financial covenants contained herein, and (C) a
written discussion and analysis by the management of the Borrower of the
financial statements furnished in respect of such month;
(b) (i) prior to the occurrence of the Holdings IPO Threshold,
as soon as available and in any event within 45 days after the end of each of
the first three Fiscal Quarters of each Fiscal Year, the Consolidated balance
sheets of WHX and its Subsidiaries and the consolidating balance sheets of the
Loan Party Consolidated Group as of the end of such quarter and the Consolidated
statements of income, retained earnings and cash flow of WHX and its
Subsidiaries and the consolidating statements of income, retained earnings and
cash flow of the Loan Party Consolidated Group for the period commencing at the
end of the previous Fiscal Year and ending with the end of such Fiscal Quarter,
certified by the chief financial officer of Holdings as fairly presenting the
financial condition and results of operations of WHX and its Subsidiaries and of
the Loan Party Consolidated Group, respectively, at such date and for such
period subject to normal year end audit adjustments, together with (A) a
certificate of said officer stating that no Default or Event of Default has
occurred and is continuing or, if a Default or an Event of Default has occurred
and is continuing, a statement as to the nature thereof and the action which the
Borrower proposes to take with respect thereto, (B) a schedule in form
satisfactory to the Agent of the computations used by the Borrower in
determining compliance with all financial covenants contained herein, and (C) a
written discussion and analysis by the management of the Borrower of the
financial statements furnished in respect of such Fiscal Quarter;
(ii) after the occurrence of the Holdings IPO Threshold, as
soon as available and in any event within 45 days after the end of each of the
first three Fiscal Quarters of each Fiscal Year, Consolidated and consolidating
balance sheets of the Loan Party Consolidated Group as of the end of such
quarter and Consolidated and consolidating statements of income, retained
earnings and cash flow of the Loan Party Consolidated Group for the period
commencing at the end of the previous Fiscal Year and ending with the end of
such Fiscal Quarter, certified by the chief financial officer of Holdings as
fairly presenting the financial condition and results of operations of the Loan
Party Consolidated Group at such date and for such period subject to normal year
end audit adjustments, together with (A) a certificate of said officer stating
that
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no Default or Event of Default has occurred and is continuing or, if a Default
or an Event of Default has occurred and is continuing, a statement as to the
nature thereof and the action which the Borrower proposes to take with respect
thereto, (B) a schedule in form satisfactory to the Agent of the computations
used by the Borrower in determining compliance with all financial covenants
contained herein, and (C) a written discussion and analysis by the management of
the Borrower of the financial statements furnished in respect of such Fiscal
Quarter;
(c) (i) prior to the occurrence of the Holdings IPO Threshold,
as soon as available and in any event within 90 days after the end of each
Fiscal Year, the Consolidated balance sheet of WHX and its Subsidiaries and the
consolidating balance sheets of the Loan Party Consolidated Group as of the end
of such year and the Consolidated statements of income, retained earnings and
cash flow of WHX and its Subsidiaries and the consolidating statements of
income, retained earnings and cash flow of the Loan Party Consolidated Group for
the period commencing at the end of the previous Fiscal Year and ending with the
end of such Fiscal Year, certified in the case of such Consolidated financial
statements without qualification as to the scope of the audit by Price
Waterhouse, any other "Big Six" accounting firm or other independent public
accountants acceptable to the Majority Lenders, together with (A) a certificate
of such accounting firm stating that in the course of the regular audit of the
business of WHX and its Subsidiaries, which audit was conducted by such
accounting firm in accordance with generally accepted auditing standards, such
accounting firm obtained no knowledge that a Default or Event of Default has
occurred and is continuing, or, if in the opinion of such accounting firm, a
Default or Event of Default has occurred and is continuing, a statement as to
the nature thereof, (B) a schedule in form satisfactory to the Agent of the
computations used by such accountants in determining, as of the end of such
Fiscal Year, the Borrower's compliance with all financial covenants contained
herein, and (C) a written discussion and analysis by the management of the
Borrower of the financial statements furnished in respect of such Fiscal Year;
(ii) after the occurrence of the Holdings IPO Threshold, as
soon as available and in any event within 90 days after the end of each Fiscal
Year, Consolidated and consolidating balance sheets of the Loan Party
Consolidated Group as of the end of such year and Consolidated and consolidating
statements of income, retained earnings and cash flow of the Loan Party
Consolidated Group for the period commencing at the end of the previous Fiscal
Year and ending with the end of such Fiscal Year, certified in the case of such
Consolidated financial statements without qualification as to the scope of the
audit by Price Waterhouse, any other "Big Six" accounting firm or other
independent public accountants acceptable to the Majority Lenders, together with
(A) a certificate of such accounting firm stating that in the course of the
regular audit of the business of the Loan Party Consolidated Group, which audit
was conducted by such accounting firm in accordance with generally accepted
auditing standards, such accounting firm obtained no knowledge that a
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Default or Event of Default has occurred and is continuing, or, if in the
opinion of such accounting firm, a Default or Event of Default has occurred and
is continuing, a statement as to the nature thereof, (B) a schedule in form
satisfactory to the Agent of the computations used by such accountants in
determining, as of the end of such Fiscal Year, the Borrower's compliance with
all financial covenants contained herein, and (C) a written discussion and
analysis by the management of the Borrower of the financial statements furnished
in respect of such Fiscal Year;
(d) not later than the date on which the Loan Parties shall
deliver to the Lender Parties the financial statements referred to in Section
6.10(c) for any Fiscal Year, a letter from the Loan Parties' independent public
accountants in form and substance satisfactory to the Agent;
(e) promptly after the same are received by the Loan Parties,
a copy of each management letter provided to the Loan Party Consolidated Group
by its independent certified public accountants which refers in whole or in part
to any material inadequacy, defect, problem, qualification or other lack of
fully satisfactory accounting controls utilized by the Loan Party Consolidated
Group; and
(f) monthly, or more frequently as the Agent may require in
its sole discretion, a Borrowing Base Certificate executed by an officer of
Holdings listed on Schedule 2.3 or by such other Person as otherwise agreed to
by the Agent, in writing, as of the end of the preceding month.
6.11. Reporting Requirements. The Loan Parties shall furnish
to the Lender Parties:
(a) as soon as available and in any event no later than 30
days after the end of each Fiscal Year, an annual budget (subject to
finalization by the Borrower) of the Loan Party Consolidated Group for the
current Fiscal Year, displaying on a monthly and quarterly basis anticipated
balance sheets, forecasted revenues, net income and cash flow, all on a
consolidated basis, and EBITDA and sales on a consolidating basis;
(b) as soon as available and in any event no later than 30
days after the end of each Fiscal Year, a forecast (subject to finalization by
the Borrower) of annual sales, EBITDA, Capital Expenditures, working capital
requirements and projected cash flow results of the Loan Party Consolidated
Group on a Consolidated and consolidating basis through the Fiscal Year ending
in 1999;
(c) as soon as available and in any event within 45 days after
the end of each Fiscal Quarter, revisions or updates to the reports delivered
pursuant to (a) and (b) above;
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(d) promptly and in any event within three Business Days after
any Loan Party, any of their Subsidiaries or any ERISA Affiliate knows or has
reason to know that any ERISA Event has occurred or is threatened, a written
statement of the chief financial officer or other appropriate officer of the
Borrower describing such ERISA Event or waiver request and the action, if any,
which the Borrower, the Guarantors, their Subsidiaries and ERISA Affiliates
propose to take with respect thereto and a copy of any notice filed with the
PBGC or the IRS pertaining thereto;
(e) promptly and in any event within three days after receipt
thereof, a copy of any adverse notice, determination letter, ruling or opinion
any Loan Party, any of their Subsidiaries or any ERISA Affiliate receives from
the PBGC, DOL or IRS with respect to any Qualified Plan and, at the request of
any Lender, a copy of any favorable notice, determination letter, ruling or
opinion with respect thereto from any Governmental Authority;
(f) promptly after the commencement thereof, notice of all
actions, suits and proceedings before any domestic or foreign Governmental
Authority or arbitrator, affecting any Loan Party or any of their Subsidiaries,
except those which, individually or in the aggregate, if adversely determined,
would have no Material Adverse Effect;
(g) promptly and in any event within three Business Days after
any Loan Party becomes aware of the existence of (i) any Default or Event of
Default, (ii) any material breach or material non-performance of, or any default
under, any Contractual Obligation which is material to the business, prospects,
operations or financial condition of the Loan Party Consolidated Group, (iii)
any breach or non-performance of, or any default under, any Lease of property
where Inventory is located or any other material Lease, or (iv) any Material
Adverse Effect or any Material Adverse Change, or any development or other
information, including, without limitation, any development or information of a
type described in Section 4.16, which has any reasonable likelihood of resulting
in a Material Adverse Change, telephonic or telegraphic notice in reasonable
detail specifying the nature of the Event of Default, Default, development or
information, including, without limitation, the anticipated effect thereof,
which notice shall be promptly confirmed in writing within five days;
(h) promptly after the sending or filing thereof, copies of
all notices, certificates or reports delivered by Holdings pursuant to the
Indentures or to the holders of the First Mortgage Notes and the Permanent
Financing Notes;
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(i) promptly after the sending or filing thereof, copies of
all reports which Holdings sends to its security holders generally, and copies
of all reports and registration statements which WHX, Holdings or any of its
Subsidiaries files with the Securities and Exchange Commission, any national
securities exchange or the National Association of Securities Dealers, Inc.;
(j) upon the request of any Lender Party, through the Agent,
copies of all federal, state and local tax returns and reports filed by any Loan
Party or any of their Subsidiaries (including consolidated, combined or unitary
returns filed with any of the Borrower's Tax Affiliates) and governmental audit
reports issued to the Borrower, any Guarantor or any of their Tax Affiliates in
respect of taxes measured by income of any Loan Party or any of their
Subsidiaries (excluding sales, use and like taxes);
(k) promptly upon, and in any event within 30 days of any Loan
Party or any of their Subsidiaries learning of any of the following, written
notice of:
(i) the receipt by any Loan Party or any of their Subsidiaries
of written notice of or a claim to the effect that any Loan Party or
any of their Subsidiaries is or may be liable to any Person as a result
of a Release or threatened Release which could reasonably be expected
to subject the Loan Parties and their Subsidiaries to Environmental
Liabilities and Costs of $5,000,000 or more;
(ii) the receipt by any Loan Party or any of their
Subsidiaries of notification that any real or personal property of any
Loan Party or any of their Subsidiaries is subject to any Environmental
Lien;
(iii) the receipt by any Loan Party or any of their
Subsidiaries of any notice of violation of, or knowledge by any Loan
Party or any of their Subsidiaries that there exists a condition which
might reasonably result in a violation by any Loan Party or any of
their Subsidiaries of, any Requirement of Law involving environmental,
health or safety matters, except for violations, the consequences of
which in the aggregate would have no reasonable likelihood of
subjecting the Loan Parties and their Subsidiaries to Environmental
Liabilities and Costs of $5,000,000 or more;
(iv) the commencement of any judicial or administrative
proceeding or investigation alleging a violation of any Requirement of
Law involving environmental, health or safety matters other than those
the consequence of which in the aggregate would have no reasonable
likelihood of subjecting the Loan Parties and their Subsidiaries to
Environmental Liabilities and Costs of $5,000,000 or more;
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(v) any proposed acquisition of stock, assets or real estate,
or any proposed leasing of property, or any other similar action by any
Loan Party or any of their Subsidiaries, other than those the
consequences of which in the aggregate have no reasonable likelihood of
subjecting the Loan Parties and their Subsidiaries to Environmental
Liabilities and Costs of $5,000,000 or more;
(vi) any proposed action taken by any Loan Party or any of
their Subsidiaries to commence, recommence or cease manufacturing,
industrial or other operations, other than those the consequences of
which in the aggregate have no reasonable likelihood of requiring any
Loan Party or any of their Subsidiaries to obtain additional
environmental, health or safety Permits that require the expenditure of
$5,000,000 or more or becoming subject to additional Environmental
Liabilities and Costs of $5,000,000 or more; and
(vii) any of the items referred to in (i) through (vi) above
regardless of the amount of Environmental Liabilities and Costs to the
extent not already reported pursuant to this Section 6.11(k), if the
aggregate Environmental Liabilities and Costs for such items would
exceed $10,000,000 in any Fiscal Year;
(l) upon written request by any Lender Party through the
Agent, a report providing an update of the status of any environmental, health
or safety compliance, hazard or liability issue identified in any notice or
report required pursuant to this Section 6.11 and any other environmental,
health or safety compliance obligation, remedial obligation or liability, other
than those which in the aggregate have no reasonable likelihood of subjecting
the Loan Parties and their Subsidiaries to Environmental Liabilities and Costs
of $5,000,000 or more;
(m) promptly upon any Loan Party or any of their Subsidiaries
being refused insurance for which it applied or had any policy of insurance
terminated (other than at its request), all information relating to such refusal
or termination;
(n) promptly and in any event within 45 days of the end of
each Fiscal Quarter and together with any amendment, waiver or other
modification of any of the Loan Documents, amendments and supplements to all of
the Schedules to the Loan Documents so as to ensure that, at the time of the
delivery of such amendments and supplements, such Schedules are accurate and
complete in all material respects as to the subject matter thereof; and
(o) such other information respecting the business,
properties, condition, financial or otherwise, or operations of any Loan Party
or any of their Subsidiaries as any Lender Party through the Agent may from time
to time reasonably request.
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6.12. Employee Plans. With respect to other than a
Multiemployer Plan, for each Qualified Plan hereafter adopted or maintained by
any Loan Party, any of their Subsidiaries or any ERISA Affiliate, such Loan
Party shall (i) seek, and cause such of their Subsidiaries and ERISA Affiliates
to seek, and receive determination letters from the IRS to the effect that such
Qualified Plan is qualified within the meaning of Section 401(a) of the Code;
and (ii) from and after the adoption of any such Qualified Plan, cause such plan
to be qualified within the meaning of Section 401(a) of the Code and to be
administered in all material respects in accordance with the requirements of
ERISA and Section 401(a) of the Code.
6.13. Fiscal Year. Each Loan Party shall maintain as its
Fiscal Year the twelve month period ending on December 31 of each year.
6.14. Borrowing Base Determination. (a) The Borrower and each
Guarantor shall conduct, or shall cause to be conducted, at its expense, and
upon request of the Agent, and present to the Agent for approval, such
appraisals, investigations or reviews as the Agent shall reasonably request for
the purpose of determining the Borrowing Base, all upon reasonable notice and at
such reasonable times during normal business hours and as often as may be
reasonably requested. The Borrower and each Guarantor shall furnish to the Agent
any information which the Agent may reasonably request regarding the
determination and calculation of the Borrowing Base including, without
limitation, correct and complete copies of any invoices, underlying agreements,
instruments or other documents and the identity of all obligors.
(b) The Borrower shall promptly notify the Agent in writing in
the event that at any time the Borrower, any Guarantor or any of their
Subsidiaries receives or otherwise gains knowledge that the Borrowing Base is
less than 110% of the Revolving Credit Commitments.
6.15. Environmental. Upon receipt of any notification or
otherwise obtaining knowledge of any Release or Environmental Liabilities and
Costs in connection with any property or operations of any Loan Party or any of
their Subsidiaries, the Borrower shall, at its cost, conduct, or pay for
consultants to conduct, appropriate (as reasonably determined by the Borrower)
tests or assessments, if any, at such time and in such manner as Borrower shall
reasonably determine, of environmental conditions at such operations or
properties including, without limitation, investigation and testing of
subsurface conditions, and shall take such remedial, investigational or other
action as any Governmental Authority lawfully requires or, if there is no such
Governmental Authority requirement, as is appropriate and consistent with good
business practice (as reasonably determined by the Borrower).
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ARTICLE VII
NEGATIVE COVENANTS
As long as any of the Obligations or Revolving Credit
Commitments remain outstanding, without the written consent of the Majority
Lenders (or the Agent, as provided in this Article VII):
7.1. Liens, Etc. No Loan Party shall create or suffer to
exist, or permit any of its Subsidiaries to create or suffer to exist, any Lien
upon or with respect to any of its or such Subsidiary's properties, whether now
owned or hereafter acquired, or assign, or permit any of its Subsidiaries to
assign, any right to receive income, except for the following (each of which
will be given independent effect); provided, however, no such Liens permitted by
this Section 7.1 (other than Permitted Liens) shall be Liens on any property
constituting Collateral:
(a) Liens created pursuant to the Loan Documents;
(b) Capitalized Lease Obligations, purchase money Liens or
purchase money security interests upon or in any property of, or owned, acquired
or held by such Loan Party or any Subsidiary of such Loan Party or any Person
acquired by such Loan Party or any of their Subsidiaries in accordance with
Section 7.5, in the ordinary course of business to secure the purchase price of
such property and Liens existing on such property at the time of its direct or
indirect acquisition by such Loan Party or such Subsidiary (other than any such
Lien created in contemplation of anticipation of such acquisition); provided,
however, that (i) any such Lien is created solely for the purpose of securing
Indebtedness representing, or incurred to acquire, finance, refinance or refund,
the cost (including, without limitation, the cost of construction) of the
property subject thereto, (ii) the principal amount of the Indebtedness secured
by such Lien does not exceed 100% of such cost, (iii) any such Lien on property
owned by any Person that is acquired by a Loan Party is on terms that are
commercially reasonable, (iv) such Lien does not extend to or cover any property
other than such item of property and any improvements on such item and (v) the
incurrence of such Indebtedness is permitted by Section 7.2(g);
(c) Liens on the Collateral (as defined in each of the
Indentures) securing the guaranty by the Borrower of the First Mortgage Notes or
the Permanent Financing Notes, as the case may be;
(d) Liens created pursuant to the Letter of Credit Agreement;
(e) Liens, if any, on Accounts and proceeds thereof of
Funding, the Borrower and the Guarantors in connection with the Receivables
Securitization;
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(f) Any Lien securing the renewal, extension, refinancing or
refunding of any Indebtedness or other obligation secured by any Lien permitted
by subsections (b), (c), (d), (e), (l), (m) or (n) of this Section 7.1 without
any increase in the amount secured thereby or in the assets subject to such
Lien;
(g) Liens arising by operation of law in favor of materialmen,
mechanics, warehousemen, carriers, lessors or other similar Persons incurred by
the Borrower, any Guarantor or any of their Subsidiaries in the ordinary course
of business which secure its obligations to such Person; provided, however, that
the Borrower, such Guarantor or such Subsidiary (i) is not in default with
respect to such payment obligation to such Person or (ii) is in good faith and
by appropriate proceedings diligently contesting such obligation and adequate
provision is made for the payment thereof and the consequences of all such liens
in the aggregate would have no Material Adverse Effect;
(h) Liens (excluding Environmental Liens) securing taxes,
assessments or governmental charges or levies; provided, however, that (i) none
of the Borrower, any Guarantor or any of their Subsidiaries is in default in
respect of any payment obligation with respect thereto and adequate provision is
made for the payment thereof or (ii) the Borrower, such Guarantor or such
Subsidiary is in good faith and by appropriate proceedings diligently contesting
such obligation, adequate provision is made for the payment thereof and the
consequence of all such failures in the aggregate would have no Material Adverse
Effect;
(i) Liens incurred or pledges and deposits made in the
ordinary course of business in connection with workers' compensation,
unemployment insurance, old-age pensions and other social security or welfare
benefits;
(j) Liens securing the performance of bids, tenders, leases,
contracts (other than for the repayment of borrowed money), statutory
obligations, surety and appeal bonds and other obligations of like nature,
incurred as an incident to and in the ordinary course of business, and judgment
liens; provided, however, that all such Liens in the aggregate (i) would have in
the aggregate no Material Adverse Effect and (ii) do not secure directly or
indirectly judgments in excess of $5,000,000;
(k) Zoning restrictions, easements, licenses, reservations,
restrictions on the use of real property or minor irregularities incident
thereto which do not in the aggregate materially detract from the value or use
of the property or assets of the Borrower, the Guarantors and their Subsidiaries
taken as a whole;
(l) Liens existing on the date of this Agreement and disclosed
on Schedule 7.1;
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(m) Liens on fixtures in connection with existing mortgages on
real property or mortgages on real property permitted hereunder;
(n) Liens on property (not constituting Collateral) of the
Borrower or any Guarantor to secure certain accumulated post-employment benefit
and related obligations of the Borrower or any Guarantor for current and future
retirees represented by the United Steelworkers of America;
(o) Liens securing non-recourse project financing Indebtedness
incurred by any member of the Loan Party Consolidated Group or against any
property of any member of the Loan Party Consolidated Group solely for the
purpose of financing the acquisition, construction or improvement of property
acquired, owned, held, controlled or used by, or contributed to a joint venture
by, any Loan Party or any of their respective Subsidiaries, including, without
limitation, in connection with the development of the Borrower's Steubenville
South Oxygen plant; provided, however, such Indebtedness shall be on competitive
terms and conditions and in any event no less favorable than those available to
companies similar to such Loan Party; and provided further that such
Indebtedness shall not exceed $25,000,000 in the aggregate at any time;
(p) Liens incurred in connection with transactions of the type
described in clause (iv) of the definition of Cash Equivalents; and
(q) other Liens to the extent not included in (a) through (o)
above provided that the Indebtedness secured by such Liens shall not have been
incurred prior to the Effective Date and shall not exceed $50,000,000 in the
aggregate at any time.
7.2. Indebtedness. No Loan Party shall create or suffer to
exist, or permit any of its Subsidiaries to create or suffer to exist, any
Indebtedness except (each of which will be given independent effect):
(a) the Obligations;
(b) Indebtedness with respect to Contingent Obligations
permitted by Section 7.10;
(c) current liabilities in respect of taxes, assessments and
governmental charges or levies incurred, or claims for labor, materials,
inventory, services, supplies and rentals incurred, or for goods or services
purchased, in the ordinary course of business consistent with the past practice
of such Loan Party and its Subsidiaries;
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(d) Indebtedness of such Loan Party or any of its Subsidiaries
outstanding on the Effective Date and reflected on Schedule 7.2;
(e) Indebtedness owing to such Loan Party by any of their
respective Subsidiaries;
(f) Indebtedness arising under any surety, payment or
performance bond reimbursement obligation entered into in the ordinary course of
such Loan Party's business and consistent with the past practice of such Loan
Party;
(g) Indebtedness of any Loan Party or any of their
Subsidiaries under Capitalized Lease Obligations and Indebtedness secured by
Liens permitted by Section 7.1(b), provided, however, that the sum of (i) the
aggregate principal amount of Capitalized Lease Obligations incurred under this
clause (g) by the Loan Parties and their Subsidiaries (and not pursuant to
clause 7.1(b) above) and (ii) the aggregate principal amount of Indebtedness
incurred pursuant to clause 7.1(b) above by the Loan Parties and their
Subsidiaries, shall not exceed $50,000,000 at any one time outstanding;
(h) Indebtedness evidenced by the Holdings Note or the
Keepwell Payments made to the Borrower by WHX and/or Holdings pursuant to the
Keepwell Agreement;
(i) Indebtedness arising under any appeal bond reimbursement
obligation entered into with respect to any judgment;
(j) Indebtedness secured by Liens permitted under Section
7.1(o) and (q);
(k) Indebtedness of the Borrower arising under the Letter of
Credit Agreement;
(l) Indebtedness constituting a renewal, extension,
refinancing or refunding of Indebtedness described in Sections 7.2(d) and (g),
(i) for a principal amount not in excess of the principal amount of such
Indebtedness and (ii) on other terms and conditions as or more favorable to the
Borrower, any Guarantor and their Subsidiaries than the terms of the
Indebtedness being renewed, extended or refunded; provided, however, that the
aggregate principal amount of all such Indebtedness incurred by Holdings shall
not exceed the then outstanding amount of the Holdings Note; and
(m) Indebtedness incurred in connection with transactions
described in clause (iv) of Cash Equivalents.
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7.3. Lease Obligations. (a) Except for existing or proposed
leases listed on Schedule 7.3 or as permitted by Section 7.5(c), no Loan Party
shall create or suffer to exist, or permit any of its Subsidiaries to create or
suffer to exist, any obligations as lessee for the rental or hire of real or
personal property in connection with any sale and leaseback transaction or for
the rental or hire of real or personal property of any kind under other leases
or agreements to lease having an original term of one year or more which would
cause the direct or contingent liabilities of the Loan Parties and their
Subsidiaries, on a consolidated basis, in respect of all such obligations (other
than any such liabilities in respect of renewals or replacements of existing
leases in amounts not in excess of those payable under existing leases) to
exceed $15,000,000 payable in any period of 12 consecutive months.
(b) Except for any lease or agreement authorized or permitted
pursuant to Section 7.3(a), no Loan Party shall, or permit any of its
Subsidiaries to, become or remain liable as lessee or guarantor or other surety
with respect to any lease, whether an operating lease or a Capitalized Lease, of
any property (whether real or personal or mixed), whether now owned or hereafter
acquired, which (i) such Loan Party or any of its respective Subsidiaries has
sold or transferred or is to sell or transfer to any other Person, or (ii) such
Loan Party or any of its respective Subsidiaries intends to use for
substantially the same purposes as any other property which has been or is to be
sold or transferred by that entity to any other Person in connection with such
lease.
7.4. Restricted Payments. No Loan Party shall (a) declare or
make, and shall not permit any of its Subsidiaries to declare or make, any
dividend payment or other distribution of assets, properties, cash, rights,
obligations or securities on account or in respect of any of its Stock or Stock
Equivalents except (i) dividends paid to a Loan Party or any wholly owned
Subsidiary of a Loan Party by any Loan Party or any of its Subsidiaries, (ii)
payments to WHX in an aggregate amount not to exceed the aggregate amount of
capital contributions made to the Loan Parties prior to the date of this
Agreement as set forth on Schedule 7.4, (iii) payments to WHX in an aggregate
amount not to exceed the aggregate amount of capital contributions made to any
Loan Party subsequent to the date of this Agreement and (iv) any payments made
to WHX pursuant to the Tax Sharing Agreement; provided, that with respect to any
payments made pursuant to clauses (a)(ii), (iii) or (iv) above (A) no Default or
Event of Default shall have occurred and be continuing or would result from such
payment and (B) such payment shall not result in a condition that would require
Keepwell Payments, or (b) purchase, redeem, prepay, defease or otherwise acquire
for value or make any payment (other than required payments) on account or in
respect of (or permit any of its Subsidiaries to do so) any principal amount of
Indebtedness for borrowed money, including, without limitation, interest, now or
hereafter outstanding, except (i) the Loans, (ii) payments made by a Loan Party
or its Subsidiary to any other Loan Party on account of any Indebtedness owing
to a Loan Party by such other Loan Party or Subsidiary, (iii) in connection with
Indebtedness being refinanced in
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accordance with Section 7.2(l), (iv) payments made to repay the Holdings Note
and not otherwise prohibited by the Holdings Intercreditor Agreement, and loans
or advances made prior to the date of this Agreement as set forth on Schedule
7.4, (v) on account of any loans or advances in the form of Keepwell Payments
made to a Loan Party pursuant to the Keepwell Agreement or other loans or
advances made by WHX to any Loan Party subsequent to the date of this Agreement,
(vi) any repurchase or redemption of the First Mortgage Notes at a price not in
excess of the then applicable redemption price as provided in the First Mortgage
Indenture and (vii) any repayments of any "Series" that has a variable "Invested
Amount" (under and as defined in the Securitization Documents); provided, that
with respect to any repayments, repurchases or redemptions made (x) pursuant to
clauses (b)(iv) (other than with respect to the Holdings Note), (v), (vi) or
(vii) above (A) no Default or Event of Default shall have occurred and be
continuing or would result from such payment, (B) such repayment, repurchase or
redemption shall not result in a condition that would require Keepwell Payments
and (C) in the event of a repayment of any Keepwell Payments, such repayment may
only be made after the end of a period of six months commencing on the last day
of the calendar month in which the immediately preceding Keepwell Payment was
made or (y) pursuant to clause (b)(iv) above with respect to the Holdings Note,
no Default or Event of Default shall have occurred and be continuing or would
result from such payment.
7.5. Mergers, Stock Issuances, Sale of Assets, Etc. (a) No
Loan Party shall, or permit any of its Subsidiaries to (i) merge with any
Person, (ii) consolidate with any Person, (iii) acquire all or substantially all
of the Stock or Stock Equivalents of any Person other than as permitted by
Section 7.6(f), (iv) acquire all or substantially all of the assets of any
Person other than as permitted by Section 7.6(f), (v) enter into any joint
venture or transaction with any Person, or (vi) sell, lease, transfer or
otherwise dispose of, whether in one transaction or in a series of transactions,
all or substantially all of its assets; provided that with respect to (iii),
(iv) and (v) above, (1) the Borrower or any Guarantor may enter into any joint
venture or transaction permitted by Section 7.6(f) and (2) with prior written
notice to the Agent, the Borrower or any Guarantor may enter into any other
joint venture or transaction requiring an aggregate Investment of cash or assets
of not more than $3,000,000.
(b) No Loan Party shall (i) issue or transfer, or permit any
of its Subsidiaries to issue or transfer, any Stock or Stock Equivalents other
than any such issuance or transfer (A) by a Subsidiary of the Borrower to the
Borrower or a wholly owned Subsidiary of the Borrower or (B) by a direct wholly
owned Subsidiary of a Guarantor to such Guarantor or (C) in connection with
transactions permitted by Section 7.5(a), 7.5(c) (other than with respect to a
Loan Party) or 7.6(f), or (ii) sell, convey, transfer, lease or otherwise
dispose of, or from and after the Effective Date permit any of its Subsidiaries
to sell, convey, transfer, lease or otherwise dispose of, any Stock or Stock
Equivalents of any of such Loan Party's Subsidiaries unless, in any such case,
both there is transferred all of the Stock and Stock Equivalents of such
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Subsidiary owned by such Loan Party and their Subsidiaries and such issuance,
sale, conveyance, transfer, lease or disposition would be permitted by Section
7.5(c).
(c) No Loan Party shall, or permit any of its Subsidiaries to,
sell, convey, transfer, lease or otherwise dispose of any of its assets or any
interest therein to any Person or permit or suffer any other Person to acquire
any interest in any of assets of such Loan Party or any such Subsidiary, except
(i) the sale or disposition of inventory in the ordinary course of business or
assets which have become obsolete, (ii) leases of personal property by the
Borrower or any wholly owned Subsidiary of the Borrower to the Borrower or to
any wholly owned Subsidiary of the Borrower, (iii) the lease or sublease of real
property not constituting a sale and leaseback, to the extent not otherwise
prohibited by this Agreement, (iv) any such sale, conveyance, transfer, lease or
other disposition to the Borrower, (v) as long as no Default or Event of Default
is continuing or would result therefrom, any such sale of any assets (other than
assets constituting Collateral) for the Fair Market Value thereof and, in the
case of any such sales that are not related to trade-ins for replacements of
existing assets, in an aggregate amount not to exceed $10,000,000 in any Fiscal
Year, plus, for each Fiscal Year, an amount equal to 50% of the excess of such
amount over the Fair Market Value of such assets actually sold in the
immediately preceding Fiscal Year, payable in cash or in notes upon such sale;
provided, that such notes shall not exceed 50% of the aggregate consideration
per Fiscal Year; and provided further that no such sale shall include assets
which are necessary to the continuing operations of any Loan Party and its
Subsidiaries, (vi) sales of accounts receivable of the Borrower and the
Guarantors permitted by Section 7.5(d), (vii) so long as no Default or Event of
Default is continuing or would result therefrom, sale and leaseback transactions
involving property having a Fair Market Value at the time of such sale and
leaseback transaction in an aggregate amount not to exceed $10,000,000 in any
Fiscal Year, (viii) sales of assets incurred in connection with transactions of
the type described in clause (iv) of the definition of Cash Equivalents and (ix)
transfers of assets permitted under Section 7.6(f).
(d) No Loan Party shall sell or otherwise dispose of, or
factor at maturity or collection, or permit any of its Subsidiaries to sell or
otherwise dispose of, or factor at maturity or collection, any of their
respective accounts receivables, except that the Borrower, the Guarantors and
their Subsidiaries may sell, transfer, pledge or otherwise convey accounts
receivables in connection with the Receivables Securitization; provided,
however, that no Loan Party or any of their Subsidiaries shall sell, transfer,
pledge or otherwise convey accounts receivables at any time an event occurs
under any Securitization Document which results in either the termination of, or
relieves the Borrower of, its obligation to do so.
7.6. Investments in Other Persons. No Loan Party shall,
directly or indirectly, make or maintain, or permit any of its Subsidiaries to
make or maintain, any loan or advance to any Person or own, purchase or
otherwise acquire, or permit
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any of its Subsidiaries to own, purchase or otherwise acquire, any Stock, Stock
Equivalents, other equity interest, obligations or other securities of, or any
assets constituting the purchase of a business or line of business, or make or
maintain, or permit any of its Subsidiaries to make or maintain, any capital
contribution to, or otherwise invest in, any Person (any such transaction being
an "Investment"), except:
(a) Investments in accounts, contract rights and chattel paper
(each as defined in the UCC), notes receivable and similar items arising or
acquired in the ordinary course of business consistent with the past practice of
the Borrower, such Guarantor and their Subsidiaries;
(b) Investments in a Subsidiary permitted by Section 7.13;
provided, however, that no Default or Event of Default has occurred and is
continuing or would result therefrom and the aggregate amount of Investments in
such Subsidiary do not exceed (i) with respect to Funding, the amount necessary
from time to time to consummate the transactions contemplated by the Receivables
Securitization, including any repayments of any "Series" that has a variable
"Invested Amount" (under and as defined in the Securitization Documents) and
(ii) with respect to all other permitted Subsidiaries that are not parties to
the Guaranty, $1,000,000;
(c) Investments in Subsidiaries of such Loan Party (in
existence as of the Effective Date) in the ordinary course of business of such
Loan Party and its Subsidiaries;
(d) loans or advances to employees of the Borrower, such
Guarantor or any of their Subsidiaries, which loans and advances shall not in
the aggregate exceed $2,000,000 outstanding at any time; provided, however, that
such loans or advances in respect of relocation expenses shall not in the
aggregate exceed $1,000,000;
(e) Investments in Cash Equivalents;
(f) Investments in (i) the Fabricating Joint Ventures, (ii)
Ohio Coatings Company, (iii) the joint venture with ISPAT, (iv) the
Co-Generation Agreement, (v) contemplated cold-rolling joint ventures and (vi)
other joint ventures as set forth on Schedule 7.6; provided that no Default or
Event of Default has occurred and is continuing or would result therefrom and
the amount of such Investments permitted pursuant to this clause (f) made from
and after the Effective Date shall not exceed in the aggregate at any time the
sum of (A) $30,000,000 and (B) all cash loans, contributions and advances, other
than Keepwell Payments, made after the Effective Date by WHX to the Loan Party
Consolidated Group;
(g) Investments in joint ventures or other entities permitted
by Section 7.5 and not otherwise described in clause (f) above; provided that no
Default
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or Event of Default has occurred and is continuing or would result therefrom and
the amount of such Investment shall not exceed $3,000,000 in the aggregate at
any time;
(h) Investments existing on the date hereof and set forth on
Schedule 7.6; and
(i) advances by the Borrower to the Guarantors under the
Guarantor Intercompany Notes.
7.7. Change in Nature of Business. No Loan Party shall,
directly or indirectly, make, or permit any of its Subsidiaries to make, any
material change in the nature or conduct of its business as carried on at the
date hereof, except as otherwise expressly permitted herein or to the extent
necessary or appropriate to adapt to changes or anticipated changes in the
business environment or otherwise deemed appropriate by management for the
manufacturing and sale of steel and steel-related products.
7.8. Material Agreements. No Loan Party shall, or permit any
of its Subsidiaries to, alter, amend, modify, rescind, terminate or waive any of
their respective rights under, or fail to comply in all respects with all of
their respective Contractual Obligations; provided, however, that, with respect
to any Contractual Obligations (other than the Loan Documents, the First
Mortgage Notes, the Permanent Financing Notes, the Securitization Documents and
the Tax Sharing Agreement), the Borrower, the Guarantors and their Subsidiaries
may do so if the consequences thereof in the aggregate have no Material Adverse
Effect and, with respect to any Contractual Obligations under the First Mortgage
Notes, the Permanent Financing Notes, the Securitization Documents and the Tax
Sharing Agreement, the Borrower, the Guarantors and their Subsidiaries may do so
with the Agent's consent if the effect of such action is not adverse to the Loan
Parties and the Lender Parties; and provided further that in the event of any
breach or event of default by a Person other than the Borrower, any Guarantor or
any of their Subsidiaries, the Borrower shall promptly notify the Agent of any
such breach or event of default and take all such action as may be reasonably
necessary in order to endeavor to cause such breach or event of default to be
cured unless the failure to do so would have no Material Adverse Effect.
7.9. Accounting Changes. No Loan Party shall make, or permit
any of its Subsidiaries to make, any change in accounting treatment and
reporting practices or tax reporting treatment, except as required by GAAP or
law, rule or regulation and disclosed to the Lender Parties and the Agent.
7.10. Contingent Obligations. No Loan Party shall, or permit
any of its Subsidiaries to, incur, assume, endorse, be or become liable for, or
guarantee, directly or indirectly, or permit or suffer to exist, any Contingent
Obligation, except for:
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(a) Contingent Obligations evidenced by a Loan Document;
(b) the guaranty by the Borrower of the First Mortgage Notes,
the Permanent Financing Notes or any renewal, extension, refinancing or
refunding thereof for a principal amount not in excess of the First Mortgage
Notes or the Permanent Financing Notes outstanding at such time and on other
terms and conditions as or more favorable to Holdings, the Borrower and its
Subsidiaries;
(c) guaranties by any Loan Party of Indebtedness of any of its
Subsidiaries to the extent such underlying Indebtedness is permitted to be
incurred hereunder;
(d) guaranties by Subsidiaries of Indebtedness of any Loan
Party or other Subsidiaries of such Loan Party, to the extent such underlying
Indebtedness is permitted to be incurred hereunder;
(e) Contingent Obligations existing or proposed on the date
hereof and listed on Schedule 7.10;
(f) Contingent Obligations incurred in connection with
transactions of the type described in clause (iv) of the definition of Cash
Equivalents: and
(g) Contingent Obligations incurred in connection with
transactions permitted under Section 7.5(a) and 7.6(f).
7.11. Transactions with Affiliates. No Loan Party shall, or
permit any of its Subsidiaries to, except as otherwise expressly permitted
herein, do any of the following: (i) make any Investment in an Affiliate of such
Loan Party not a wholly owned Subsidiary of such Loan Party; (ii) transfer,
sell, lease, assign or otherwise dispose of any asset to any Affiliate of such
Loan Party not a wholly owned Subsidiary of such Loan Party; (iii) merge into or
consolidate with or purchase or acquire assets from any Affiliate of such Loan
Party other than a wholly owned Subsidiary of such Loan Party; (iv) repay any
Indebtedness to any Affiliate of such Loan Party; or (v) enter into any other
transaction directly or indirectly with or for the benefit of any Affiliate of
such Loan Party not a wholly owned Subsidiary of such Loan Party (including,
without limitation, guaranties and assumptions of obligations of any such
Affiliate) except for (A) transactions in the ordinary course of business on a
basis no less favorable to such Loan Party or such Subsidiary as would be
obtained in a comparable arm's length transaction with a Person not an
Affiliate, (B) reasonable salaries and other employee compensation, including,
without limitation, any profit sharing and other established bonus or deferred
compensation plans, to officers or directors of such Loan Party or any of its
Subsidiaries commensurate with current compensation levels; provided, however
that such Loan Party may pay salaries or other employee compensation at levels
commensurate with
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industry practice to new employees who are not Affiliates of the such Loan Party
immediately prior to the date of hire, (C) any transaction required or otherwise
permitted by this Agreement, (D) fees paid to WHX by the Borrower not in excess
of $5,000,000 per Fiscal Year to pay management fees, the proceeds of which are
then used by WHX solely to (1) pay management fees pursuant to the management
agreement between WHX and WPN Corp. in effect on the Effective Date and (2) pay
bonuses to management of the Borrower; provided, however, that no such loans,
advances or management fees may be paid if there has occurred and is continuing
a Default or Event of Default, or a Default or an Event of Default would occur
as a result of the payment of such management fee, (E) those transactions listed
on Schedule 7.11, (F) transactions with Ohio Coatings Company, Wheeling-Nisshin,
Xxxx Xxxx and ISPAT previously disclosed in writing to the Agent and the Lender
Parties on a basis no less favorable to the Borrower or such Subsidiary as would
be obtained in a comparable arm's-length transaction with a Person not an
Affiliate, (G) payments under the Tax Sharing Agreement, (H) advances of cash by
the Borrower to the Guarantors under the Guarantor Intercompany Notes or (I)
other transactions with Affiliates to the extent not included in (A) through (H)
provided that the amounts payable by the Borrower and the Guarantors in
connection with such transactions shall not in the aggregate exceed $2,000,000
per Fiscal Year.
7.12. Cancellation of Indebtedness Owed to It. No Loan Party
shall cancel, or permit any of its Subsidiaries to cancel, any claim or
Indebtedness owed to it except for adequate consideration and in the ordinary
course of business, except to the extent that such cancellation occurs in
connection with the consummation of a plan of reorganization or liquidation of
the obligor under such Indebtedness and such cancellation would not have a
Material Adverse Effect.
7.13. No New Subsidiaries. No Loan Party shall, or permit any
of its Subsidiaries to, incorporate or otherwise organize any Subsidiary which
was not in existence on the Effective Date (a "New Subsidiary") without the
prior written consent of the Majority Lenders except as otherwise permitted
pursuant to Sections 7.5 and 7.6; provided that only the prior written consent
of the Agent shall be necessary in connection with any New Subsidiary of the
Borrower or any Guarantor if such New Subsidiary's Net Worth is not in excess of
$1,000,000; provided further that, in any case, the Stock of any such New
Subsidiary is pledged to the Agent for the benefit of the Secured Parties
pursuant to a pledge agreement in form and substance satisfactory to the Agent.
7.14. Capital Structure. Except as otherwise permitted
hereunder, no Loan Party shall make, or permit any of its Subsidiaries to make,
any change in its capital structure (including, without limitation, in the terms
of its outstanding Stock) or amend its certificate of incorporation or by-laws,
other than those changes which, in the aggregate, would have no Material Adverse
Effect.
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7.15. No Speculative Transactions. No Loan Party shall, or
permit any of its Subsidiaries to, engage in any speculative transaction or,
except for the sole purpose of hedging in the normal course of business and
consistent with industry practices, engage in any transaction involving
commodity options or futures contracts.
7.16. Margin Regulations. The Loan Parties shall not use the
proceeds of any Loans to purchase or carry any margin stock.
7.17. Bank Accounts. None of the Borrower or any Guarantor
shall maintain any bank account other than those provided in Section 2.19, the
Cash Collateral Account, the collateral accounts required to be maintained by
the Borrower pursuant to the Letter of Credit Agreement, those listed on
Schedule 7.17 for the purposes listed thereon and other operational accounts
with the prior written consent of the Agent; provided that the Borrower may open
one or more bank accounts to facilitate the performance of its servicing
obligations in connection with the Receivables Securitization. Notwithstanding
the foregoing, the Borrower and the Guarantors shall be entitled to open new
accounts (i) in replacement of those identified on Schedule 7.17 having the same
purposes and (ii) for specified purposes including employee payroll, trustee and
escrow accounts and if approved by the Agent, for new Subsidiaries, so long as
the Agent receives prior written notification of each such new account and a
blocked account letter, in form and substance satisfactory to the Agent.
7.18. Environmental Release. No Loan Party shall, or permit
any of its Subsidiaries to, or allow any lessee or other Person to, effect or
suffer to occur, from and after the Effective Date, any Release in respect of,
or dispose of, from and after the Effective Date, any Contaminant which creates
liability under or is in violation of any Environmental Law if the consequence
of all such Releases and disposals in the aggregate would result in a Material
Adverse Effect.
ARTICLE VIII
EVENTS OF DEFAULT
8.1. Events of Default. Each of the following events shall be
an Event of Default:
(a) The Borrower shall fail to pay any principal of any Loan
(including, without limitation, mandatory prepayments of principal) or any fee
due any Lender Party or the Agent, other amount due hereunder or under the other
Loan Documents or other of the Obligations when the same becomes due and payable
(except for interest on any Loan) or the Borrower shall fail to pay interest on
any Loan within three days after the same becomes due and payable; or
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(b) Any representation or warranty made or deemed made by any
Loan Party in any Loan Document or by any Loan Party (or any of its officers) in
connection with any Loan Document shall prove to have been incorrect in any
material respect when made or deemed made; or
(c) Any Loan Party shall fail to perform or observe (i) any
term, covenant or agreement contained in Articles V, VI or VII, in any
Collateral Document or in the Keepwell Agreement or (ii) any other term,
covenant or agreement contained in this Agreement or in any other Loan Document
if such failure under this clause (ii) shall remain unremedied for ten Business
Days after the earlier of the date on which (A) a Responsible Officer of any
Loan Party becomes aware of such failure or (B) written notice thereof shall
have been given to the Borrower by the Agent or any Lender Party; or
(d) Any Loan Party or any of its Subsidiaries shall fail to
pay any principal of or premium or interest on any Indebtedness for borrowed
money of such Loan Party or Subsidiary that is outstanding in a principal amount
of at least $1,000,000 (excluding Indebtedness evidenced by the Revolving Credit
Notes), when the same becomes due and payable after, in the case all such
Indebtedness, any applicable period of grace (whether by scheduled maturity,
required prepayment, acceleration, demand or otherwise); or any other event
shall occur or condition shall exist under any agreement or instrument relating
to any such Indebtedness, if the effect of such event or condition is to
accelerate, or to permit the acceleration of, the maturity of such Indebtedness;
or any such Indebtedness shall be declared to be due and payable, or required to
be prepaid (other than by a regularly scheduled required prepayment), prior to
the stated maturity thereof; or
(e) Any Loan Party or any of its Subsidiaries shall generally
not pay its debts as such debts become due, or shall admit in writing its
inability to pay its debts generally, or shall make a general assignment for the
benefit of creditors, or any proceeding shall be instituted by or against any
Loan Party or any of its Subsidiaries seeking to adjudicate it a bankrupt or as
insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors, or
seeking the entry of an order for relief or the appointment of a receiver,
trustee or other similar official for it or for any substantial part of its
property and, in the case of any such proceedings instituted against any Loan
Party or any of its Subsidiaries (but not instituted by it), either such
proceedings shall remain undismissed or unstayed for a period of 30 days or any
of the actions sought in such proceedings shall occur; or any Loan Party or any
of its Subsidiaries shall take any corporate action to authorize any of the
actions set forth above in this subsection (e); or
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(f) Any final judgment or order for the payment of money in
excess of $100,000 shall be rendered against any Loan Party or any of its
Subsidiaries and either (i) enforcement proceedings shall have been commenced by
any creditor upon such judgment or order, or (ii) there shall be any period of
10 consecutive days following entry of such judgment or order (or, in the event
that the terms of such judgment or order do not require immediate payment,
following the date or dates on which such payment is to be made) during which
such judgment or order shall not have been paid, compromised or otherwise
satisfied and a stay of enforcement of such judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect; provided, however, that
such final judgment or order shall not be deemed an Event of Default if (x) such
final judgment or order is less than $1,000,000, (y) such final judgment or
order is fully covered by insurance carried by any Loan Party and (z) such
non-payment, non-compromise or non-satisfaction is solely the result of the
insurance company's tardiness in payment; or
(g) an ERISA Event shall occur which, in the reasonable
determination of the Majority Lenders, has a reasonable possibility of a
liability, deficiency or waiver request of the Borrower or any ERISA Affiliate,
whether or not assessed, exceeding $5,000,000; or
(h) Any material provision of any Collateral Document, the
Keepwell Agreement prior to the release thereof in accordance with its terms or
the Holdings Intercreditor Agreement after delivery thereof shall for any reason
cease to be valid and binding on any Loan Party thereto, or any such Loan Party
shall so state in writing; or
(i) At any time prior to the consummation of the Holdings IPO,
WHX shall fail to own of record and beneficially all of the outstanding Stock
and Stock Equivalents of Holdings (other than non-voting, non-participating
perpetual preferred Stock that satisfies the requirements of Section 1504(a)(4)
of the Code), free and clear of all Liens; or
(j) Holdings shall fail to own of record and beneficially all
of the outstanding Stock and Stock Equivalents of each of the Borrower, PCC and
Wheeling Construction (other than non-voting, non-participating perpetual
preferred Stock that satisfies the requirements of Section 1504(a)(4) of the
Code), free and clear of all Liens except those Liens created under the
Collateral Documents; or
(k) Any of WHX (prior to the Holdings IPO) or any other Loan
Party shall fail to own of record and beneficially all of the outstanding stock
and Stock Equivalents of Unimast (other than non-voting, non-participating
perpetual preferred Stock that satisfies the requirements of Section 1504(a)(4)
of the Code) free and clear of all Liens: or
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(l) There shall occur a Material Adverse Change or an event
which would have a Material Adverse Effect; or
(m) At any time on or after (i) a majority of the members of
the Board of Directors of Holdings shall be replaced over a two-year period,
from the directors who constituted the Board of Directors at the Effective Date,
and such replacement shall not have been approved by the Board of Directors of
Holdings as constituted at the Effective Date (or its replacements approved by
the Board of Directors of Holdings) or (ii) a Person or group of Persons acting
in concert as a partnership or other group (other than WHX) shall, as a result
of a tender or exchange offer, open market purchases, privately negotiated
purchases or otherwise, have become the beneficial owner (within the meaning of
Rule 13d-3 under the Securities and Exchange Act of 1934, as amended) of
securities of Holdings representing 20% or more of the combined voting power of
the then outstanding securities of WHX ordinarily (and apart from rights
accruing under special circumstances) having the right to vote in the election
of directors; or
(n) A "termination event" (other than an "early amortization
event") (as such terms are defined in the Securitization Documents) shall occur
and be continuing and shall not have been rescinded in accordance with the terms
of the Securitization Documents; or
(o) Holdings or the Borrower shall, or shall permit any of the
Borrower's Subsidiaries to, (i) alter, rescind, terminate, amend, supplement,
waive or otherwise modify any provision of or permit any breach or default or
other event to exist under the First Mortgage Notes, the Permanent Financing
Notes or the Holdings Note, or take or fail to take any action thereunder,
unless any of the foregoing would not in the aggregate have a Material Adverse
Effect; or (ii) amend, modify or change, or consent or agree to any amendment,
modification or change to, any of the terms relating to the payment or
prepayment of principal of, or premium or interest on, any First Mortgage Note,
any Permanent Financing Note or the Holdings Note (other than any such
amendment, modification or change which would extend the maturity or reduce the
amount of any payment of principal thereof or which would reduce the rate or
extend the date for payment of interest thereon).
8.2. Remedies. If there shall occur and be continuing an Event
of Default, the Agent (i) shall at the request, or may with the consent, of the
Majority Lenders, by notice to the Borrower, terminate the obligation of each
Lender to make Loans and of each Issuer to issue Letters of Credit, whereupon
the same shall forthwith terminate, and (ii) shall at the request, or may with
the consent, of the Majority Lenders, by notice to the Borrower, declare the
Loans, all interest thereon and all other Obligations payable under this
Agreement to be forthwith due and payable, whereupon the Revolving Credit Notes,
all such interest and all such Obligations shall become and be forthwith due and
payable, without presentment,
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demand, protest or further notice of any kind, all of which are hereby expressly
waived by the Borrower; provided, however, that upon the occurrence of the Event
of Default specified in subparagraph (e) above, (A) the obligation of each
Lender to make Loans and of each Issuer to issue Letters of Credit shall
automatically be terminated and (B) the Revolving Credit Notes, all such
interest and all such Obligations shall automatically become and be due and
payable, without presentment, demand, protest or any notice of any kind, all of
which are hereby expressly waived by the Borrower. In addition to the remedies
set forth above, the Agent may, or at the request of the Majority Lenders shall,
after the giving of notice as provided in clause (ii) above, exercise any
remedies provided for by the Collateral Documents in accordance with the terms
thereof or any other remedies provided by applicable law.
8.3. Actions in Respect of Letters of Credit. (a) If any Event
of Default shall have occurred and be continuing, the Agent may, from time to
time, irrespective of whether it is taking any of the actions described in
Section 8.2 or otherwise, make demand upon the Borrower to, and forthwith upon
such demand the Borrower will, pay to the Agent on behalf of the Lender Parties
in same day funds at the Agent's office, for deposit in a special cash
collateral account (Account #00000000) maintained in the name of the Agent on
behalf of the Secured Parties at Citibank (the "L/C Cash Collateral Account"),
an amount equal to all outstanding Letter of Credit Obligations. In the Agent's
discretion, the L/C Cash Collateral Account may be an interest or a non-interest
bearing account.
(b) The Borrower hereby pledges, and grants to the Agent a
Lien on and security interest in, all of its right, title and interest in and to
the L/C Cash Collateral Account, all funds held in the L/C Cash Collateral
Account from time to time and all proceeds thereof, as security for the payment
of all amounts due and to become due from the Borrower to the Secured Parties
under the Loan Documents.
(c) The Agent shall, from time to time after funds are
deposited in the L/C Cash Collateral Account, apply funds then held in the L/C
Cash Collateral Account to the Issuer for the payment of any Reimbursement
Obligations owing to it and then in such order as the Agent shall determine, as
shall have become or shall become due and payable by the Borrower to the Secured
Parties in respect of the Obligations.
(d) Neither the Borrower nor any Person claiming on behalf of
or through the Borrower shall have any right to withdraw any of the funds held
in the L/C Cash Collateral Account.
(e) The Borrower agrees that it will not (i) sell or otherwise
dispose of any interest in the L/C Cash Collateral Account or any funds held
therein or (ii) create or permit to exist any Lien upon or with respect to the
L/C Cash Collateral
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Account or any funds held therein, except as provided in or contemplated by this
Agreement.
(f) The Agent may also exercise, in its sole discretion, in
respect of the L/C Cash Collateral Account, in addition to the other rights and
remedies provided for herein or otherwise available to it, all the rights and
remedies of a secured party upon default under the UCC in effect in the State of
New York at that time, and the Agent may, without notice except as specified
below, sell the L/C Cash Collateral Account or any part thereof in one or more
parcels at public or private sale, at any of the Agent's offices or elsewhere,
for cash, or credit or for future delivery, and upon such other terms as the
Agent may deem commercially reasonable. The Borrower agrees that, to the extent
notice of sale shall be required by law, at least ten days' notice to the
Borrower of the time and place of any public sale or the time after which any
private sale is to be made shall constitute reasonable notification. The Agent
shall not be obligated to make any sale of the L/C Cash Collateral Account,
regardless of notice of sale having been given. The Agent may adjourn any public
or private sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the time and
place to which it was so adjourned.
(g) Any cash held in the L/C Cash Collateral Account, and all
cash proceeds received by the Agent in respect of any sale of, collection from
or other realization upon all or any part of the L/C Cash Collateral Account,
may, in the discretion of the Agent, then or at any time thereafter be applied
(after the expiration of all outstanding Letters of Credit and the payment of
any amounts payable pursuant to Sections 8.3(c) and 10.4) in whole or in part by
the Agent against all or any part of the Obligations now or hereafter existing
under any of the Loan Documents in such order as the Agent shall elect. Any
surplus of such cash or cash proceeds held by the Agent and remaining after the
indefeasible cash payment in full of all of the Obligations shall be paid over
to the Borrower or to whomsoever may be lawfully entitled to receive such
surplus.
ARTICLE IX
THE AGENT
9.1. Authorization and Action. Each Lender Party (in its
capacities as a Lender, the Swing Bank and an Issuer, as applicable) hereby
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers and discretion under this Agreement and the other Loan
Documents as are delegated to the Agent by the terms hereof and thereof,
together with such powers and discretion as are reasonably incidental thereto.
As to any matters not expressly provided for by this Agreement and the other
Loan Documents (including, without limitation,
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enforcement or collection of the Revolving Credit Notes), the Agent shall not be
required to exercise any discretion or take any action, but shall be required to
act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Majority Lenders, and such
instructions shall be binding upon all Lender Parties and all holders of
Revolving Credit Notes; provided, however, that the Agent shall not be required
to take any action which the Agent in good faith believes exposes it to personal
liability or is contrary to this Agreement or applicable law. The Agent agrees
to give to each Lender Party prompt notice of each notice given to it by any
Loan Party pursuant to the terms of this Agreement or the other Loan Documents.
9.2. Agent's Reliance, Etc. None of the Agent or any of its
Affiliates or any of the respective directors, officers, agents or employees of
the Agent or any such Affiliate shall be liable for any action taken or omitted
to be taken by it or them under or in connection with this Agreement or the
other Loan Documents, except for its or their own gross negligence or willful
misconduct. Without limitation of the generality of the foregoing, the Agent (i)
may treat the payee of any Revolving Credit Note as the holder thereof until
such Note has been assigned in accordance with Section 10.7; (ii) may rely on
the Register to the extent set forth in Section 10.7(c), (iii) may consult with
legal counsel (including, without limitation, counsel to the Borrower or any
other Loan Party), independent public accountants and other experts selected by
it and shall not be liable for any action taken or omitted to be taken in good
faith by it in accordance with the advice of such counsel, accountants or
experts; (iv) makes no warranty or representation to any Lender Party and shall
not be responsible to any Lender Party for any statement, warranty or
representation (whether written or oral) made in or in connection with this
Agreement or any of the other Loan Documents; (v) shall not have any duty to
ascertain or to inquire as to the performance or observance of any of the terms,
covenants or conditions of this Agreement or any of the other Loan Documents on
the part of the Borrower or any other Loan Party or to inspect the property
(including, without limitation, the books and records) of the Borrower or any
other Loan Party; (vi) shall not be responsible to any Lender Party for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of, or the perfection or priority of any lien or security interest created or
purported to be created under or in connection with any Loan Document, of this
Agreement or any of the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto; and (vii) shall incur no liability under
or in respect of this Agreement or any of the other Loan Documents by acting
upon any notice, consent, certificate or other instrument or writing (which may
be by telegram, telecopy, cable or telex) believed by it to be genuine and
signed or sent by the proper party or parties.
9.3. Citibank, Citicorp and Affiliates. With respect to its
Revolving Credit Commitment, the Loans (including, without limitation, the
Revolving Credit Loans and Swing Loans) made by it, any each Revolving Credit
Note and any Letters
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of Credit issued by it, Citicorp shall have the same rights and powers under
this Agreement as any other Lender Party and may exercise the same as though it
were not an Affiliate of the Agent; and the term "Lender Party" or "Lender
Parties" shall, unless otherwise expressly indicated, include Citicorp in its
individual capacity. Citibank and its Affiliates may accept deposits from, lend
money to, act as trustee under indentures of, accept investment banking
engagements from and generally engage in any kind of business with, the Borrower
or any other Loan Party or any of their respective Subsidiaries and any Person
who may do business with or own securities of the Borrower or any other Loan
Party or any of their respective Subsidiaries, all as if Citibank were not the
Agent and without any duty to account therefor to the Lender Parties.
9.4. Lender Party Credit Decision. Each Lender Party
acknowledges that it has, independently and without reliance upon the Agent or
any other Lender Party and based on the financial statements referred to in
Article IV and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender Party also acknowledges that it will, independently and
without reliance upon the Agent or any other Lender Party and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement and other Loan Documents.
9.5. Indemnification. (a) The Lender Parties severally agree
to indemnify the Agent, its Affiliates and their respective directors, officers,
employees, agents and advisors (to the extent not reimbursed by the Borrower or
other Loan Parties), from and against such Lender Party's ratable share
(determined as provided below) of any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses and disbursements
(including, without limitation, fees and disbursements of legal counsel) of any
kind or nature whatsoever which may be imposed on, incurred by, or asserted
against, the Agent in any way relating to or arising out of this Agreement or
any of the other Loan Documents or any action taken or omitted by the Agent
under this Agreement or any of the other Loan Documents including, without
limitation, the preparation of reports with respect to the Collateral; provided,
however, that no Lender Party shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the Agent's (or any of its
agent's) gross negligence or willful misconduct. Without limitation of the
foregoing, each Lender Party agrees to reimburse the Agent promptly upon demand
for its ratable share of any out-of-pocket expenses (including, without
limitation, fees and disbursements of legal counsel) incurred by the Agent in
connection with the preparation, execution, delivery, administration (including,
without limitation, field examinations of Collateral), modification, amendment
or enforcement (whether through negotiations, legal proceedings or otherwise)
of, or legal advice in respect of its rights or responsibilities under, this
Agreement or any of the other Loan Documents, to the
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extent that the Agent is not reimbursed for such expenses by the Borrower or
another Loan Party except to the extent such expenses result from the Agent's
(or any of its agent's) gross negligence or willful misconduct. For purposes of
this Section 9.5, the Lender Parties' respective ratable shares of any amount
shall be determined, at any time, according to the sum of (a) the aggregate
principal amount of the Loans outstanding at such time and owing to the
respective Lender Parties, (b) their respective Ratable Portions of the
aggregate Letter of Credit Obligations outstanding at such time plus (c) their
respective Ratable Portions of the Available Credit at such time. The failure of
any Lender Party to reimburse the Agent promptly upon demand for its ratable
share of any amount required to be paid by the Lender Party to the Agent as
provided herein shall not relieve any other Lender Party of its obligation
hereunder to reimburse the Agent for its ratable share of such amount, but no
Lender Party shall be responsible for the failure of any other Lender Party to
reimburse the Agent for such other Lender Party's ratable share of such amount.
Without prejudice to the survival of any other agreement of any Lender Party
hereunder, the agreement and obligations of each Lender Party contained in this
Section 9.5(a) shall survive the payment in full of principal, interest and all
other amounts payable hereunder and under the other Loan Documents.
(b) Each Lender Party severally agrees to indemnify each
Issuer (to the extent not promptly reimbursed by the Borrower) from and against
such Lender Party's ratable share (determined as provided below) of any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever that may be
imposed on, incurred by, or asserted against such Issuer in any way relating to
or arising out of the Loan Documents or any action taken or omitted by such
Issuer under the Loan Documents; provided, however, that no Lender Party shall
be liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from such Issuer's (or any of its agent's) gross negligence or willful
misconduct. Without limitation of the foregoing, each Lender Party agrees to
reimburse such Issuer promptly upon demand for its ratable share of any costs
and expenses (including, without limitation, fees and expenses of counsel)
payable by the Borrower under Section 10.4, to the extent that such Issuer is
not promptly reimbursed for such costs and expenses by the Borrower except to
the extent such expenses result form such Issuer's (or any of its agent's) gross
negligence or willful misconduct. For purposes of this Section 9.5(b), the
Lender Parties' respective ratable shares of any amount shall be determined, at
any time, according to the sum of (a) the aggregate principal amount of the
Loans outstanding at such time and owing to the respective Lender Parties, (b)
their respective Ratable Portions of the aggregate Letter of Credit Obligations
outstanding at such time plus (c) their respective Ratable Portions of the
Available Credit at such time. The failure of any Lender Party to reimburse such
Issuer promptly upon demand for its ratable share of any amount required to be
paid by the Lender Parties to such Issuer as provided herein shall not relieve
any other Lender Party of its obligation hereunder to reimburse such Issuer for
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its ratable share of such amount, but no Lender Party shall be responsible for
the failure of any other Lender Party to reimburse such Issuer for such other
Lender Party's ratable share of such amount. Without prejudice to the survival
of any other agreement of any Lender Party hereunder, the agreement and
obligations of each Lender Party contained in this Section 9.5(b) shall survive
the payment in full of principal, interest and all other amounts payable
hereunder and under the other Loan Documents.
9.6. Successor Agent. The Agent may resign at any time by
giving written notice thereof to the Lender Parties and the Borrower. Upon any
such resignation, the Majority Lenders shall have the right to appoint a
successor Agent; provided, that if no Default or Event of Default shall have
occurred and be continuing, such successor Agent shall be reasonably
satisfactory to the Borrower, which shall be (a) a commercial bank organized
under the laws of the United States of America or any State thereof and having
total assets of at least $1,000,000,000 and a combined capital and surplus of at
least $50,000,000 or (b) a Lender as of the Effective Date. If no successor
Agent shall have been so appointed by the Majority Lenders, and shall have
accepted such appointment, within 30 days after the retiring Agent's giving of
notice of resignation or the removal of the retiring Agent at the request of all
of the Lenders (other than the Agent and its Affiliates), then the retiring
Agent may, on behalf of the Lender Parties, appoint a successor Agent approved,
as long as no Default or Event of Default has occurred and is continuing, by the
Borrower, such approval not be unreasonably withheld or delayed, which successor
shall be (a) a commercial bank organized under the laws of the United States of
America or of any State thereof and having total assets of at least
$1,000,000,000 and a combined capital and surplus of at least $50,000,000 or (b)
a Lender as of the Effective Date. Upon the acceptance of any appointment as
Agent hereunder by a successor Agent and upon the execution and filing or
recording of such financing statements, or amendments thereto, and such other
instruments or notices, as may be necessary or desirable, or as the Majority
Lenders may request, in order to continue the perfection of the Liens granted or
purported to be granted by the Collateral Documents, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers, discretions,
privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations under this Agreement and the other
Loan Documents. After any retiring Agent's resignation or removal hereunder as
Agent, the provisions of this Article IX shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under this
Agreement and the other Loan Documents.
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ARTICLE X
MISCELLANEOUS
10.1. Amendments, Etc. (a) No amendment or waiver of any
provision of this Agreement or any other Loan Document (including, without
limitation, the waiver of any Default or Event of Default) nor consent to any
departure by the Borrower or any other Loan Party therefrom shall in any event
be effective unless the same shall be in writing and signed (or, in the case of
the Collateral Documents, consented to) by the Borrower and the Majority
Lenders, and then any such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no amendment, waiver or consent shall, unless in writing and
signed by all the Lenders do any of the following at any time: (i) waive any of
the conditions specified in Sections 3.1 or 3.2 except as otherwise provided
therein; (ii) increase, or extend the expiration date of, the Revolving Credit
Commitments of the Lenders or subject the Lenders to any additional obligations;
(iii) reduce (A) the amount of any payment of any principal of, or interest on,
the Loans due under this Agreement, (B) the stated rate of any interest payable
hereunder or (C) the amount of any fees or other amounts payable hereunder; (iv)
postpone any date fixed for any payment of principal of, or interest on, the
Loans or any fees or other amounts payable hereunder; (v) change the percentage
of the Revolving Credit Commitments, the aggregate unpaid principal amount of
the Loans or the Letter of Credit Obligations, or the number of Lenders which
shall be required for the Lenders or any of them to take any action hereunder;
(vi) release any of the Collateral except that, so long as no Default or Event
of Default has occurred and is continuing or would result therefrom, (A) as
shall otherwise be provided in the Collateral Documents and Section 7.5(d) and
(B) in any Fiscal Year, Collateral having an aggregate Fair Market Value not in
excess of $25,000,000 shall require only the consent of the Agent; (vii) amend
this Section 10.1; (viii) amend the definition of Majority Lenders; (ix)
terminate the Keepwell Agreement (except pursuant to its terms), the Holdings
Guaranty, the Guaranty or any other keepwell agreement or guaranty delivered
pursuant to the Loan Documents; or (x) increase the advance rates above those
set forth on Schedule IV hereto for Eligible Inventory; provided further that no
amendment, waiver or consent shall, unless in writing and signed by the Swing
Bank or each Issuer, as the case may be, in addition to the Lenders required
above to take such action, affect the rights or obligations of the Swing Bank or
of the Issuers, as the case may be, under this Agreement, and provided further
that no amendment, waiver or consent shall, unless in writing and signed by the
Agent in addition to the Lenders required above to take such action, affect the
rights or duties of the Agent under this Agreement or the other Loan Documents.
(b) Each Lender Party grants (x) to the Agent the right to
purchase all (but not less than all) of such Lender Party's Commitments and
Loans owing to it and the Notes held by it and all of its rights and obligations
hereunder and under the
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other Loan Documents at a price equal to the aggregate amount of outstanding
Loans owed to such Lender Party (together with all accrued and unpaid interest
and fees owed to such Lender), and (y) to the Borrower the right to cause an
assignment of all (but not less than all) of such Lender Party's Commitments and
Loans owing to it and the Notes held by it and all of its rights and obligations
hereunder and under the other Loan Documents, which right may be exercised by
the Agent or the Borrower, as the case may be, if such Lender Party refuses to
execute any amendment, waiver or consent which requires the written consent of
all the Lenders and to which the Agent and the Borrower have agreed. Each Lender
Party agrees that if the Agent or the Borrower, as the case may be, exercises
its option hereunder, it shall promptly execute and deliver all agreements and
documentation necessary to effectuate such assignment as set forth in Section
10.7. Any purchase of such Lender Party's Commitments and Loans owing to it and
the Notes held by it must (i) occur within 30 Business Days from the date that
such Lender Party refuses to execute any amendment, waiver or consent which
requires the written consent of all the Lenders and to which the Agent and the
Borrower have agreed and (ii) include an amount payable to such Lender Party
which is sufficient to compensate such Lender Party for any loss, expense, or
liability as a result of any purchase of such Lender Party's Commitments and
Loans owing to it and the Notes held by it under this Section 10.1(b) which
arises out of, or is in connection with, any funds acquired by such Lender Party
to make, continue, or maintain any portion of the principal amount of any Loan
as, or to convert any portion of the principal amount of any Loan into, a
Eurodollar Rate Loan.
10.2. Notices, Etc. All notices and other communications
provided for hereunder shall be in writing (including, without limitation,
telegraphic, telex, telecopy or cable communication) and mailed, telegraphed,
telexed, telecopied, cabled or delivered by hand, if to the Borrower, at its
address at 0000 Xxxxxx Xxxxxx, Xxxxxxxx, Xxxx Xxxxxxxx 00000, Attention: Chief
Financial Officer with copy to WHX or WPN Corp. at 000 Xxxx 00xx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xx. Xxxxxxx Xxxxx; if to any Lender, at its
Domestic Lending Office specified opposite its name on Schedule III hereto; and
if to the Agent, at its address at 000 Xxxx Xxxxxx, 0xx Xxxxx, Xxxx 4, New York,
New York 10043, Attention: Xxxxx X. Xxxxxx; or, as to the Borrower or the Agent,
at such other address as shall be designated by such party in a written notice
to the other parties and, as to each other party, at such other address as shall
be designated by such party in a written notice to the Borrower and the Agent.
All such notices and communications shall, when mailed, telegraphed, telexed,
telecopied, cabled or delivered, be effective when deposited in the mails,
delivered to the telegraph company, confirmed by telex answerback, telecopied
with confirmation of receipt, delivered to the cable company or delivered by
hand to the addressee or its agent, respectively, except that notices and
communications to the Agent pursuant to Article II or IX shall not be effective
until received by the Agent.
Delivery by telecopier of an executed counterpart of any
amendment or waiver of any provision of this Agreement or the Revolving Credit
Notes or of any
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Exhibit hereto to be executed and delivered hereunder shall be effective as
delivery of a manually executed counterpart thereof.
10.3. No Waiver; Remedies. No failure on the part of any
Lender Party or the Agent to exercise, and no delay in exercising, any right
hereunder or under any Revolving Credit Note shall operate as a waiver thereof;
nor shall any single or partial exercise of any such right preclude any other or
further exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
10.4. Costs; Expenses; Indemnities. (a) The Borrower agrees to
pay on demand (i) the reasonable costs and expenses of the Agent in connection
with the preparation, execution, delivery, administration, modification and
amendment of this Agreement, each of the other Loan Documents and each of the
other documents to be delivered hereunder and thereunder, including, without
limitation, (A) all due diligence, collateral review, syndication,
transportation, computer, duplication, appraisal, audit, insurance, consultant,
search, filing and recording fees and expenses and (B) the reasonable fees and
out-of-pocket expenses of counsel to the Agent with respect thereto and with
respect to advising the Agent as to its rights and responsibilities or the
perfection, protection or preservation of rights or interests under this
Agreement and the other Loan Documents with respect to negotiations with any
Loan Party or with other creditors of any Loan Party or any of its Subsidiaries
arising out of any Default or Event of Default or any events or circumstances
that may give rise thereto and with respect to presenting claims in or otherwise
participating in or monitoring any bankruptcy, insolvency or other similar
proceeding involving creditors rights generally and any proceeding ancillary
thereto, (ii) the per diem cost of any audit or collateral evaluation (of not
more than $500 per day) of the Agent and (iii) the reasonable costs and expenses
of the Lender Parties (including, without limitation, reasonable counsel fees
and expenses) in connection with the enforcement (whether through negotiation,
legal proceedings or otherwise) of this Agreement, the other Loan Documents and
the other documents to be delivered hereunder or thereunder.
(b) The Borrower agrees to indemnify and hold harmless the
Agent, each Lender Party and their respective Affiliates, and the directors,
officers, employees, agents, attorneys, consultants and advisors of or to any of
the foregoing (including, without limitation, those retained in connection with
the satisfaction or attempted satisfaction of any of the conditions set forth in
Article III) (each of the foregoing being an "Indemnitee") from and against any
and all claims, damages, liabilities, obligations, losses, penalties, actions,
judgments, suits, costs, disbursements and expenses of any kind or nature
(including, without limitation, reasonable fees and disbursements of counsel to
any such Indemnitee) which may be imposed on, incurred by or asserted against
any such Indemnitee in connection with or arising out of any investigation,
litigation or proceeding, whether or not any such Indemnitee is a party thereto,
whether direct, indirect or consequential and whether based on any federal,
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state or local law or other statutory regulation, securities or commercial law
or regulation, or under common law or in equity, or on contract, tort or
otherwise, in any manner relating to or arising out of this Agreement, any other
Loan Document, any Obligation, any Letter of Credit or any act, event or
transaction related or attendant to any thereof or in connection with any
investigation by any Governmental Authority of any potential matter covered
hereby or thereby (collectively, the "Indemnified Matters"), including, without
limitation, (i) all Environmental Liabilities and Costs arising from or
connected with the past, present or future operations of the Borrower or any of
its Subsidiaries, or damage to real or personal property or natural resources or
harm or injury alleged to have resulted from any Release; (ii) any costs or
liabilities incurred in connection with the investigation, removal, cleanup
and/or remediation of any Contaminant present or arising out of the operations
of any facility of the Borrower or any of its Subsidiaries; (iii) any costs or
liabilities incurred in connection with any Environmental Lien; (iv) any costs
or liabilities incurred in connection with any other matter affecting any
facility pursuant to Environmental Laws, including, without limitation, CERCLA
and applicable state property transfer laws, including, without limitation,
whether, with respect to any of the foregoing, such Indemnitee is a mortgagee
pursuant to any leasehold mortgage, a mortgagee in possession, the successor in
interest to the Borrower or any of its Subsidiaries, or the owner, lessee or
operator of any facility of the Borrower or any of its Subsidiaries by virtue of
foreclosure, except, with respect to any of the foregoing referred to in clauses
(i), (ii), (iii) and (iv), to the extent attributable solely to acts of the
Agent or such Indemnitee or any agent on behalf of the Agent or such Lender
following (x) foreclosure by the Agent or any Indemnitee, or (y) the Agent or
any Lender having become the successor in interest to the Borrower or any of its
Subsidiaries; (v) the management of the Loans and Letters of Credit, or (vi) the
use or intended use of the proceeds of the Loans or Letters of Credit; provided,
however, that the Borrower shall not have any obligation under this Section
10.4(b) to an Indemnitee with respect to any Indemnified Matter caused by or
resulting from the gross negligence or willful misconduct of that Indemnitee.
(c) If any Lender receives any payment of principal of, or is
subject to a conversion of, any Eurodollar Rate Loan, other than on the last day
of an Interest Period relating to such Loan, as a result of any payment or
conversion made by the Borrower (other than a payment made to the Agent pursuant
to Section 2.3(f)) or acceleration of the maturity of the Revolving Credit Notes
pursuant to Section 8.2 or for any other reason or a conversion of a Eurodollar
Rate Loan does not occur by reason of the fourth sentence of Section 2.8, the
Borrower shall, upon demand by such Lender (with a copy of such demand to the
Agent), pay to the Agent for the account of such Lender all amounts required to
compensate such Lender for any additional losses, costs or expenses which it may
reasonably have incurred or in the future incur as a result of such payment or
conversion, including, without limitation, any actual out-of-pocket loss, cost
or expense incurred by reason of the liquidation or
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reemployment of deposits or other funds acquired by such Lender to fund or
maintain such Loan.
(d) The Agent and each Lender agree that in the event that any
such investigation, litigation or proceeding set forth in subparagraph (b) above
is asserted or threatened in writing or instituted against it or any other
Indemnitee, or any remedial, removal or response action is requested of it or
any of its officers, directors, agents and employees, for which any Indemnitee
may desire indemnity or defense hereunder, such Indemnitee shall promptly notify
the Borrower in writing.
(e) The Borrower, at the request of any Indemnitee, shall have
the obligation to defend against such investigation, litigation or proceeding or
requested remedial, removal or response action, and the Borrower, in any event,
may control the defense thereof with legal counsel of the Borrower's choice. In
the event that such Indemnitee requests the Borrower to defend against such
investigation, litigation or proceeding or requested remedial, removal or
response action, the Borrower shall promptly do so and such Indemnitee shall
have the right to have legal counsel of its choice participate in such defense
at such Indemnitee's expense. If, without the Borrower's prior written consent
which consent shall not be unreasonably withheld, an Indemnitee shall settle any
such investigation, litigation, proceeding or other action, such Indemnitee
shall be deemed to have waived its rights to indemnity and defense hereunder.
(f) The obligations of the Borrower under this Section 10.4
and under Sections 2.10 and 2.12 shall survive the repayment of the Loans and
the termination of the Revolving Credit Commitments.
10.5. Right of Set-off. Upon the occurrence and during the
continuance of any Event of Default, each Lender Party and each of its
respective Affiliates is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by such Lender Party or such Affiliate to
or for the credit or the account of the Borrower against any and all of the
Obligations now or hereafter existing irrespective of whether or not such Lender
Party shall have made any demand under this Agreement, any Revolving Credit Note
or any Reimbursement Agreement or any other Loan Document and although such
Obligations may be unmatured. Each Lender Party agrees promptly to notify the
Borrower after any such set-off and application made by such Lender Party or its
Affiliate; provided, however, that the failure to give such notice shall not
affect the validity of such set-off and application. The rights of each Lender
Party and its respective Affiliates under this Section are in addition to the
other rights and remedies (including, without limitation, other rights of
set-off) which such Lender Party and its respective Affiliates may have.
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10.6. Binding Effect. This Agreement shall become effective
when it shall have been executed by the Borrower and the Agent and when the
Agent shall have been notified by each Lender Party that such Lender Party has
executed it and thereafter shall be binding upon and inure to the benefit of the
Borrower, the Agent and each Lender Party and their respective successors and
assigns, except that the Borrower shall not have the right to assign its rights
hereunder or any interest herein without the prior written consent of the Lender
Parties.
10.7. Assignments and Participations. (a) Each Lender may
sell, transfer, negotiate or assign to one or more other Lenders or Eligible
Assignees all or a portion of its Revolving Credit Commitments, commitment to
issue Letters of Credit and the Loans and Letter of Credit Obligations owing to
it and Revolving Credit Notes held by it and a commensurate portion of its
rights and obligations hereunder and under the other Loan Documents; provided,
however, that (i) if such an assignment is of Revolving Credit Loans and
Revolving Credit Commitments, each such assignment shall be of a constant, and
not a varying, percentage of the assigning Lender's rights and obligations under
this Agreement with respect to Revolving Credit Loans, Letters of Credit and
Revolving Credit Commitments, (ii) the aggregate amount of the Revolving Credit
Commitments, Letters of Credit, Letter of Credit Obligations and Loans being
assigned pursuant to each such assignment (determined as of the date of the
Assignment and Acceptance with respect to such assignment) shall in no event be
less than $5,000,000, in the case of an assignment to a Lender Party, or
$15,000,000, in the case of an assignment to a Person that is not a Lender
Party, or, in each case, an integral multiple of $1,000,000 in excess thereof,
unless such assignment is of the Lender's entire Revolving Credit Commitment,
and (iii) each assignee hereunder shall be an Eligible Assignee. The parties to
each assignment shall execute and deliver to the Agent, for its acceptance and
recording in the Register, an Assignment and Acceptance, together with a fee of
$3,500 and the Revolving Credit Note (or an affidavit of loss and indemnity with
respect to such Revolving Credit Note, satisfactory to the Agent) subject to
such assignment. Upon such execution, delivery, acceptance and recording, from
and after the effective date specified in such Assignment and Acceptance, (A)
the assignee thereunder shall become a party hereto and, to the extent that
rights and obligations under the Loan Documents have been assigned to such
assignee pursuant to such Assignment and Acceptance, have the rights and
obligations of a Lender, and if such Lender was an Issuer, of an Issuer
hereunder and thereunder with respect to Letters of Credit issued after such
effective date, and (B) the assignor thereunder shall, to the extent that rights
and obligations under this Agreement have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights (except for those rights which
survive the payment in full of principal and interest hereunder) and be released
from its obligations under the Loan Documents (and, in the case of an Assignment
and Acceptance covering all or the remaining portion of an assigning Lender's or
Issuer's rights and obligations under the Loan Documents, such Lender or Issuer
shall cease to be a party hereto).
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(b) By executing and delivering an Assignment and Acceptance,
the Lender assignor thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Acceptance, such assigning Lender Party makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or any other Loan Document or any instrument or other document
furnished pursuant hereto or thereto or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with, this Agreement or any other Loan Document or any
other instrument or document furnished pursuant hereto or thereto; (ii) such
assigning Lender Party makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Loan Party or the
performance or observance by any Loan Party of any of its obligations under this
Agreement or any other Loan Document or of any other instrument or document
furnished pursuant hereto or thereto; (iii) such assignee confirms that it has
received a copy of this Agreement and each of the other Loan Documents together
with a copy of any of the financial statements referred to in Section 4.5 of
this Agreement and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee will, independently and without
reliance upon the Agent, such assigning Lender Party or any other Lender Party,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement; (v) such assignee confirms that it is an Eligible
Assignee; (vi) such assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers and discretion under
this Agreement and the other Loan Documents as are delegated to the Agent by the
terms hereof and thereof, together with such powers and discretion as are
reasonably incidental thereto; and (vii) such assignee agrees that it will
perform in accordance with their terms all of the obligations which by the terms
of this Agreement are required to be performed by it as a Lender and, if
appropriate, an Issuer.
(c) The Agent shall maintain at its address referred to in
Section 10.2 a copy of each Assignment and Acceptance delivered to and accepted
by it and a register for the recordation of the names and addresses of the
Lender Parties and the Revolving Credit Commitments of, Letter of Credit
Obligations owing to, and principal amount of the Loans owing to each Lender
Party from time to time (the "Register"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error, and the Loan
Parties, the Agent and the Lender Parties may treat each Person whose name is
recorded in the Register as a Lender Party for all purposes of this Agreement.
The Register shall be available for inspection by the Borrower, the Agent or any
Lender Party at any reasonable time and from time to time upon reasonable prior
notice.
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(d) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender Party and an assignee representing that it is an Eligible
Assignee, together with the Revolving Credit Note subject to such assignment,
the Agent shall, if such Assignment and Acceptance has been completed, (i)
accept such Assignment and Acceptance, (ii) record the information contained
therein in the Register and (iii) give prompt notice thereof to the Borrower.
Within five Business Days after its receipt of such notice, the Borrower, at its
own expense, shall execute and deliver to the Agent, in exchange for such
surrendered Revolving Credit Note, a new Revolving Credit Note to the order of
such Eligible Assignee in an amount equal to the Revolving Credit Commitment
assumed by it pursuant to such Assignment and Acceptance and, if the assigning
Lender Party has retained a Revolving Credit Commitment hereunder, a new
Revolving Credit Note to the order of the assigning Lender Party in an amount
equal to the Revolving Credit Commitment retained by it hereunder. Such new
Revolving Credit Note shall be dated the same date as the surrendered Revolving
Credit Note and be in substantially the form of Exhibit A hereto.
(e) Each Lender Party may sell participations to one or more
banks or other Persons in or to all or a portion of its rights and obligations
under the Loan Documents (including, without limitation, all or a portion of its
Revolving Credit Commitment, the Letter of Credit Obligations owing to it and
the Loans owing to it and the Revolving Credit Note held by it). The terms of
such participation shall not, in any event, require the participant's consent to
any amendment, waiver or other modification of any provision of any Loan
Document, the consent to any departure by any Loan Party therefrom, or to the
exercising or refraining from the exercise of any powers or rights which such
Lender Party may have under or in respect of the Loan Documents (including,
without limitation, the right to enforce the obligations of the Loan Parties),
except if any such amendment, waiver or other modification or consent would (i)
reduce the amount, or postpone any date fixed for, any amount (whether of
principal, interest or fees) payable to such participant under the Loan
Documents to which such participant would otherwise be entitled under such
participation or (ii) result in the release of any of the Collateral, except (A)
as shall otherwise be provided in the Collateral Documents and (B) Collateral
having an aggregate Fair Market Value not in excess of $25,000,000 in any Fiscal
Year. In the event of the sale of any participation by any Lender Party, (i)
such Lender Party's obligations under the Loan Documents (including, without
limitation, its Revolving Credit Commitment) shall remain unchanged, (ii) such
Lender Party shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) such Lender Party shall remain the holder
of such Revolving Credit Note and Obligations for all purposes of this
Agreement, (iv) such Lender Party shall disclose to the Agent the identity of
each bank or other entity purchasing a participation and the principal amount of
such participation within five Business Days after the sale and purchase of such
participation, and (v) the Borrower, the Agent and the other Lender
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Parties shall continue to deal solely and directly with such Lender in
connection with such Lender Party's rights and obligations under this Agreement.
(f) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time create a security interest in all or any
portion of its rights under this Agreement (including, without limitation, the
Loans owing to it and the Note or Notes held by it) in favor of any Federal
Reserve Bank in accordance with Regulation A of the Board of Governors of the
Federal Reserve System.
10.8. Governing Law. This Agreement and the Revolving Credit
Notes and the rights and obligations of the parties hereto and thereto shall be
governed by, and construed in accordance with, the law of the State of New York.
10.9. Submission to Jurisdiction. (a) Any legal action or
proceeding with respect to this Agreement or the Revolving Credit Notes or any
document related thereto may be brought in the courts of the State of New York
or of the United States of America for the Southern District of New York, and,
by execution and delivery of this Agreement, the Borrower hereby accepts for
itself and in respect of its property, generally and unconditionally, the
jurisdiction of the aforesaid courts. The parties hereto hereby irrevocably
waive any objection, including, without limitation, any objection to the laying
of venue or based on the grounds of forum non conveniens, which any of them may
now or hereafter have to the bringing of any such action or proceeding in such
respective jurisdictions.
(b) The Borrower irrevocably consents to the service of
process of any of the aforesaid courts in any such action or proceeding by the
mailing of a copy thereof by registered or certified mail, postage prepaid, to
the Borrower at its address provided herein.
(c) Nothing contained in this Section 10.9 shall affect the
right of the Agent or any Lender Party or any holder of a Revolving Credit Note
to serve process in any other manner permitted by law or commence legal
proceedings or otherwise proceed against the Borrower in any other jurisdiction.
10.10. Section Titles. The Section titles contained in this
Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreement among the parties hereto.
10.11. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
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10.12. No Liability of the Issuers. The Borrower assumes all
risks of the acts or omissions of any beneficiary or transferee of any Letter of
Credit with respect to its use of such Letter of Credit. Neither any Issuer nor
any of its officers or directors shall be liable or responsible for: (a) the use
that may be made of any Letter of Credit or any acts or omissions of any
beneficiary or transferee in connection therewith; (b) the validity, sufficiency
or genuineness of documents, or of any endorsement thereon, even if such
documents should prove to be in any or all respects invalid, insufficient,
fraudulent or forged; (c) payment by such Issuer against presentation of
documents that do not comply with the terms of a Letter of Credit, including
failure of any documents to bear any reference or adequate reference to the
Letter of Credit; or (d) any other circumstances whatsoever in making or failing
to make payment under any Letter of Credit, except that the Borrower shall have
a claim against such Issuer, and such Issuer shall be liable to the Borrower, to
the extent of any direct, but not consequential, damages suffered by the
Borrower that the Borrower prove were caused by (i) such Issuer's willful
misconduct or gross negligence in determining whether documents presented under
any Letter of Credit comply with the terms of the Letter of Credit or (ii) such
Issuer's willful failure to make lawful payment under a Letter of Credit after
the presentation to it of a draft and certificates strictly complying with the
terms and conditions of the Letter of Credit. In furtherance and not in
limitation of the foregoing, such Issuer may accept documents that appear on
their face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary.
10.13. Entire Agreement. This Agreement, together with all of
the other Loan Documents and all certificates and documents delivered hereunder
or thereunder, and the fee letter by and between the Borrower and each of the
Lender Parties embody the entire agreement of the parties and supersedes all
prior agreements and understandings relating to the subject matter hereof.
10.14. Confidentiality. Each Lender Party and the Agent agree
to keep information obtained by it pursuant hereto and the other Loan Documents
confidential in accordance with such Lender Party's or the Agent's, as the case
may be, customary practices and agrees that it will only use such information in
connection with the transactions contemplated by this Agreement and not disclose
any of such information other than (i) to such Lender Party's or the Agent's, as
the case may be, Affiliates, employees, representatives and agents who are or
are expected to be involved in the evaluation of such information in connection
with the transactions contemplated by this Agreement and who are advised of the
confidential nature of such information, (ii) to the extent such information
presently is or hereafter becomes available to such Lender Party or the Agent,
as the case may be, on a non-confidential basis from a source other than the
Borrower, (iii) to the extent disclosure is required by law, regulation or
judicial order (which requirement or order shall be promptly notified to the
Borrower) or requested or required by bank regulators or
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auditors, or (iv) to assignees or participants or potential assignees or
participants who agree to be bound by the provisions of this Section.
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10.15. Waiver of Jury Trial. Each of the Borrower, the Agent
and the Lender Parties irrevocably waives all right to trial by jury in any
action, proceeding or counterclaim (whether based on contract, tort or
otherwise) arising out of or relating to any of the Loan Documents, the Loans or
the actions of the Agent or any Lender Party in the negotiation, administration,
performance or enforcement thereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized
as of the date first above written.
BORROWER
WHEELING-PITTSBURGH STEEL
CORPORATION
By:_______________________________
Name: Xxxx Xxxxx
Title: Vice President
AGENT
CITIBANK, N.A.,
as Agent
By:_______________________________
Name:
Title:
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LENDERS
CITICORP USA, INC.
By:_______________________________
Name:
Title:
CORESTATES BANK, N.A.
By:_______________________________
Name:
Title:
BANKAMERICA BUSINESS CREDIT,
INC.
By:_______________________________
Name:
Title:
STAR BANK, N.A.
By:_______________________________
Name:
Title:
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NATIONSBANK, N.A.
By:_______________________________
Name:
Title:
NATIONAL CITY COMMERCIAL
FINANCE, INC.
By:_______________________________
Name:
Title:
ISSUER (AND NOT LENDER)
CITIBANK, N.A.
By:_________________________________
Name:
Title:
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