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Exhibit 10.52
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NOTE PURCHASE AND LETTER OF CREDIT AGREEMENT
among
LTV STEEL COMPANY, INC.,
As a Party and as Agent for certain Affiliates
VARIOUS FINANCIAL INSTITUTIONS,
CHASE SECURITIES INC.,
as Placement Agent,
THE CHASE MANHATTAN BANK,
as Administrative Agent
and
THE CHASE MANHATTAN BANK,
as Collateral Agent
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DATED AS OF FEBRUARY 26, 1998
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TABLE OF CONTENTS
ARTICLE I.
DEFINITIONS..............................................................................................1
Section 1.1. Definitions............................................................................1
ARTICLE II.
CLASS A-1 NOTE PURCHASES AND SALES.......................................................................1
Section 2.1. Facility...............................................................................1
Section 2.2. Repurchases............................................................................3
Section 2.3. Repurchases at other than the end of an Interest Period................................3
Section 2.4. Establishment of Interest Rates and Periods............................................4
ARTICLE III.
LETTERS OF CREDIT........................................................................................4
Section 3.1. Assumption and Issuance of Letters of Credit...........................................4
Section 3.2. Terms of Letters of Credit.............................................................6
Section 3.3. Lender's Participation.................................................................6
Section 3.4. Request for Issuance...................................................................7
Section 3.5. Payment of Amounts Drawn Under Letters of Credit.......................................7
Section 3.6. Payment by Lenders; Defaulting Lenders.................................................7
Section 3.7. Nature of Issuing Lender's Duties......................................................8
Section 3.8. Obligations Absolute...................................................................9
Section 3.9. Collateralization.....................................................................10
Section 3.10. Amendments to Letter of Credit........................................................11
Section 3.11. The Register..........................................................................12
Section 3.12. Commitment Reductions.................................................................12
Section 3.13. Indemnification of Issuing Lenders....................................................13
ARTICLE IV
INTEREST, FEES, EXPENSES AND PAYMENTS...................................................................13
Section 4.1. Payment of Interest...................................................................13
Section 4.2. Reimbursement of Expenses; Other Fees.................................................13
Section 4.3. Fees in Respect of Letters of Credit..................................................13
Section 4.4. Unused Line Fee.......................................................................14
Section 4.5. Indemnification in Certain Events.....................................................14
Section 4.6. Calculations..........................................................................16
Section 4.7. Taxes.................................................................................16
Section 4.8 Sharing of Payments...................................................................21
ARTICLE V.
CONDITIONS PRECEDENT....................................................................................21
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Section 5.1. Conditions to Effective Date, Initial Issuance of Letters of Credit
and Obligation to Purchase Class A-1 Notes............................................21
Section 5.2. Conditions to Each Letter of Credit...................................................24
ARTICLE VI.
REPRESENTATIONS AND WARRANTIES..........................................................................25
Section 6.1. Corporate Status......................................................................25
Section 6.2. Corporate Power and Authority.........................................................25
Section 6.3. No Violation..........................................................................25
Section 6.4. Litigation............................................................................26
Section 6.5. Governmental Approvals................................................................26
Section 6.6. Investment Company Act................................................................26
Section 6.7. Public Utility Holding Company Act....................................................26
Section 6.8. True and Complete Disclosure..........................................................26
Section 6.9 Financial Condition; Financial Statements.............................................27
Section 6.10. Business Names........................................................................27
Section 6.11. Tax Returns and Payments..............................................................28
Section 6.12. Compliance with ERISA.................................................................28
Section 6.13 Compliance with Statutes, etc.........................................................28
Section 6.14. Performance of Agreements.............................................................28
Section 6.15 Margin Regulations....................................................................28
Section 6.16 Class A-1 Notes.......................................................................28
ARTICLE VII.
AFFIRMATIVE COVENANTS...................................................................................29
Section 7.1. Financial Information.................................................................29
Section 7.2. Corporate Franchises..................................................................30
Section 7.3 Compliance with Statutes, etc.........................................................31
Section 7.4 Maintenance of Properties;............................................................31
Section 7.5 Taxes.................................................................................31
Section 7.6 Notices in case of Default............................................................31
Section 7.7 Loss of Perfection Event..............................................................31
ARTICLE VIII.
NEGATIVE COVENANTS......................................................................................32
Section 8.1. Consolidation, Merger, Sale of Assets, etc............................................32
Section 8.2. Exercise of Remedies..................................................................32
ARTICLE IX.
EVENTS OF DEFAULT AND REMEDIES..........................................................................32
Section 9.1. Events of Default..........................................................................32
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ARTICLE X.
THE AGENTS..............................................................................................34
Section 10.1. Appointment of the A.gents...............................................................34
Section 10.2. Resignation of the Agents................................................................38
Section 10.3. Obligations Several......................................................................38
ARTICLE XI.
MISCELLANEOUS...........................................................................................39
Section 11.1. Submission to Jurisdiction; Waiver........................................................39
Section 11.2. Jury Trial................................................................................40
Section 11.3 Governing Law.............................................................................40
Section 11.4. Delays; Partial Exercise of Remedies......................................................40
Section 11.5. Notices...................................................................................40
Section 11.6. Benefit of Agreement......................................................................40
Section 11.7. Confidentiality...........................................................................43
Section 11.8. Indemnification...........................................................................44
Section 11.9. Headings Descriptive......................................................................45
Section 11.10. Amendment or Waiver......................................................................45
Section 11.11. Nonliability of Placement Agent, the Administrative Agent and
Financing Parties........................................................................46
Section 11.12. Counterparts.............................................................................46
Section 11.13. Effectiveness............................................................................46
Section 11.14. Maximum Rate.............................................................................46
Section 11.15. Right of Setoff..........................................................................47
Section 11.16 Extension of Facility....................................................................47
Section 11.17 Inspection of Inventory..................................................................48
SCHEDULES AND EXHIBITS
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Schedule I Listing of Commitments and Financing Parties
Schedule II Listing of Assumed Letters of Credit
Schedule III Listing of TBT Lease Agreements
Schedule IV Affiliates of LTV Steel
EXHIBITS
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Exhibit A Form of Letter of Credit Request
Exhibit B Form of Opinion from Counsel to LTV Steel
Exhibit C Form of Opinion from Counsel to the Note Purchasers and Lenders
Exhibit D Form of Secretary's Certificate
Exhibit E Form of Assignment and Assumption Agreement
Exhibit F Form of Confidentiality Agreement
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THIS NOTE PURCHASE AND LETTER OF CREDIT AGREEMENT is entered into as of
February 26, 1998, among LTV Steel Company, Inc., a New Jersey corporation, as a
party and as agent (in such capacities, "LTV Steel") for its Affiliates
indicated on Schedule IV hereto (LTV Steel and such Affiliates herein, the
"Members"), each of those financial institutions listed from time to time on
Schedule I hereto (each a "Note Purchaser" or a "Lender" or a "Financing Party"
as the context requires and collectively the "Note Purchasers" or the "Lenders"
or the "Financing Parties"), Chase Securities Inc. ("CSI"), acting as Placement
Agent (the "Placement Agent"), The Chase Manhattan Bank, acting as
Administrative Agent (the "Administrative Agent") in the manner and to the
extent described in Article X hereof and The Chase Manhattan Bank acting as
Collateral Agent (the "Collateral Agent") under the Trust Agreement, as defined
below.
WITNESSETH:
WHEREAS, LTV Steel, in its own capacity or as agent on behalf of the
other Members which are from time to time Sellers pursuant to the Contribution
and Sale Agreement, from time to time may desire to sell or purchase Class A-1
Notes to or from the Note Purchasers;
WHEREAS, LTV Steel has requested the Lenders to provide certain letters
of credit on behalf of itself and the other Members and, in certain cases, its
other Affiliates;
WHEREAS, subject to the terms of conditions of this Agreement, the Note
Purchasers and the Lenders are willing to provide such facilities hereunder;
NOW, THEREFORE, the parties hereto hereby agree as follows:
ARTICLE I.
DEFINITIONS
Section 1.1. DEFINITIONS. For all purposes of this Agreement, except as
otherwise expressly provided herein or unless the context otherwise requires,
capitalized terms used herein shall have the meanings assigned to such terms in
Annex X attached hereto, which is incorporated by reference herein.
ARTICLE II.
CLASS A-1 NOTE PURCHASES AND SALES
Section 2.1. FACILITY. (a) From time to time LTV Steel and the other
Members may own Class A-1 Notes which LTV Steel wishes to sell to the Note
Purchasers, subject to a right to repurchase such Class A-1 Notes from the Note
Purchasers as provided in SECTION 2.2. Subject to the terms and conditions of
this Agreement, each Note Purchaser agrees to purchase from LTV Steel (without
recourse except as expressly contemplated hereby) its Pro Rata Portion of Class
A-1 Notes that LTV Steel may request be purchased by the Note Purchasers. The
obligation of the Note Purchasers to purchase such Class A-1 Notes is subject to
the following conditions:
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On the Note Purchase Date:
(i) there shall not be in existence a Trust
Agreement Event of Default;
(ii) the representations and warranties of LTV
Steel and its Affiliates contained in this
Agreement and each other Transaction
Document are true and correct in all
material respects on and as of such date as
though made on such date, except to the
extent that such representations and
warranties expressly relate solely to an
earlier date (in which case such
representations and warranties shall have
been true and correct on and as of such
earlier date);
(iii) the Amortization Date shall not have
occurred;
(iv) there shall not be in existence a Note
Purchase Agreement Event of Default;
(v) the purchase price for each such Class A-1
Note to be purchased shall be equal to the
principal amount thereof (individually the
"Note Purchase Price"; and in the aggregate,
the "Aggregate Note Purchase Price");
(vi) no Financing Party shall be required to
purchase Class A-1 Notes in a principal
amount in excess of its Pro Rata Portion of
the Class A-1 Notes being sold under this
Section nor at any time shall a Financing
Party be required to purchase Class A-1
Notes if such purchase would cause the sum
of the aggregate outstanding principal
amount of Class A-1 Notes owned by it plus
its Pro Rata Portion of the Letter of Credit
Usage to exceed its Commitment;
(vii) the Class A-1 Notes to be purchased shall
not be Term Notes and the Note Purchase Date
specified shall be the first day of an
Interest Period with respect to each Class
A-1 Note to be purchased on such date;
(viii) as indicated on the most recent Sales and
Valuation Report, the Company shall be in
compliance with the Note Collateral Value
Requirement; and
(ix) no change or development shall have occurred
since the Effective Date which has in any
case, has had or is reasonably expected to
have a Material Adverse Collateral Effect,
and shall be continuing.
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(b) LTV Steel may utilize the Note Purchase Facility by
providing a written notice ("Note Purchase Notice") to the Placement
Agent on or before 12:00 Noon (New York City time) on any Business Day
as to the principal amount of Class A-1 Notes to be purchased and the
date on which such Notes are to be purchased (the "Note Purchase
Date"), which shall be a Business Day not sooner than the third
Business Day next following the date of delivery of the related Note
Purchase Notice, except that in the case of Class A-1 Notes to be
purchased which shall bear interest at an ABR Interest Rate, such Note
Purchase Notice may be delivered on the Business Day immediately
preceding the Business Day on which such Notes are to be purchased. By
11:00 A.M. (New York City time) on the Note Purchase Date each Note
Purchaser shall deliver to the Placement Agent its Pro Rata Portion of
the Aggregate Note Purchase Price in immediately available funds for
redelivery by the Placement Agent to LTV Steel by 12:00 Noon (New York
City time) on the Note Purchase Date.
Delivery of the Class A-1 Notes to the Note Purchasers may be
made by notation in the Note Register by the Note Registrar of the
respective ownership of such Class A-1 Notes by each Note Purchaser.
Section 2.2. REPURCHASES. (a) From time to time LTV Steel may
repurchase Class A-1 Notes from the Note Purchasers. Subject to the terms and
conditions of this Agreement, each Note Purchaser agrees to sell to LTV Steel
its Pro Rata Portion of Class A-1 Notes that LTV Steel may request to repurchase
from the Note Purchasers. The obligation of the Note Purchasers to sell such
Class A-1 Notes to LTV Steel is subject to the condition that on the Note
Repurchase Date LTV Steel shall have paid an amount equal to the principal
amount of such Notes to be repurchased plus any other amounts due under SECTION
2.3 of this Agreement in payment therefor (the "Note Repurchase Price") for such
repurchased Class A-1 Notes.
(b) LTV Steel may repurchase Class A-1 Notes from the Note
Purchasers by providing a written notice ("Note Repurchase Notice") to
the Placement Agent on or before 12:00 Noon (New York City time) on any
Business Day as to the principal amount of Class A-1 Notes to be
repurchased and the date on which such Notes are to be repurchased (the
"Note Repurchase Date"), which shall be a Business Day not sooner than
the third Business Day next following the date of delivery of the
related Note Repurchase Notice. LTV Steel shall deliver the aggregate
Note Repurchase Price to the Placement Agent by 11:00 A.M. (New York
City time) on the Note Repurchase Date for redelivery to the respective
Note Purchasers selling such Notes to LTV Steel.
Section 2.3. REPURCHASES AT OTHER THAN THE END OF AN INTEREST PERIOD.
LTV Steel agrees that if the Note Repurchase Date of any Note bearing interest
at a LIBOR based Interest Rate does not correspond with the last day of the
Interest Period applicable thereto, the Note Repurchase Price with respect to
each such Note will include the following amounts:
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a. accrued and unpaid interest on such Note
through the Note Repurchase Date; and
b. a breakage fee ("Breakage Fee") which shall
be the actual losses, costs and damages
incurred by the Note Purchasers as a result
of the repurchase occurring prior to the
last day of the Interest Period for such
Notes, but will not include any lost
"profits" including interest rate margin for
the period after the Notes are repurchased.
A certificate of the Placement Agent setting
forth any amount or amounts that the Note
Purchasers are entitled to receive pursuant
to this Section shall be delivered to LTV
Steel and shall be conclusive absent
manifest error.
Section 2.4. ESTABLISHMENT OF INTEREST RATES AND PERIODS. The Financing
Parties hereby appoint LTV Steel as their agent for the purposes of the
establishment of any Interest Rate Period or Interest Rate on any Class A-1 Note
as to which the Financing Parties (or the Placement Agent or the Administrative
Agent on their behalf) are the Holders (including as pledgees) of such Notes.
The Financing Parties agree that LTV Steel may provide all notices to the Issuer
with respect thereto and, subject to the provisions hereof, establish any
Interest Rate Period or Interest Rate on such Notes as LTV Steel may select.
Delivery of the Class A-1 Notes to LTV Steel may be made by
notation in the Note Registrar by the Collateral Agent of such transfers from
the Note Purchasers to LTV Steel.
ARTICLE III.
LETTERS OF CREDIT
Section 3.1. ASSUMPTION AND ISSUANCE OF LETTERS OF CREDIT.
(a) ASSUMED LETTERS OF CREDIT. As of the Effective Date, each
of the Assumed Letters of Credit, descriptions of which are set forth
on Schedule II hereto, shall be deemed to be a Letter of Credit issued
hereunder by one or more of the Issuing Lenders for the account of LTV
Steel or its Affiliate for whose account the Assumed Letter of Credit
was originally issued and shall be subject to all of the terms and
provisions of this Agreement.
(b) ISSUANCE OF LETTERS OF CREDIT. LTV Steel may request, in
accordance with the provisions of this SECTION 3.1(B), from time to
time during the period from the Effective Date to but excluding the
date which is five Business Days prior to the Expiration Date
applicable to the Commitment of the relevant Issuing Lender, that one
or more Issuing Lenders issue a Letter of Credit (x) in replacement
(through exchange or issuance
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of a backing Letter of Credit) of any Assumed Letter of Credit or any
Letter of Credit previously issued in replacement thereof, for the
account of LTV Steel or one of its Affiliates, so long as (A) such
Letter of Credit shall be issued to support the same obligations as the
Assumed Letter of Credit (or Letter of Credit previously issued in
replacement thereof) being replaced and (B) the requested Letter of
Credit may not have a Stated Amount greater than the current Stated
Amount of the Assumed Letter of Credit (or Letter of Credit previously
issued in replacement thereof) which is being replaced or a scheduled
amortization which extends the date for, or reduces the amount of, any
scheduled reduction in the Stated Amount of the Assumed Letter of
Credit (or Letter of Credit previously issued in replacement thereof)
being replaced or (y) in support of obligations, other than obligations
described in clause (x) above, of LTV Steel or its Affiliates incurred
in the ordinary course of their respective businesses, or otherwise
satisfactory to the Administrative Agent and such Issuing Lender.
Subject to the terms and conditions of this Agreement and in reliance
upon the representations and warranties of LTV Steel set forth herein,
upon the request of LTV Steel pursuant to SECTION 3.4, one or more
Issuing Lenders selected by LTV Steel shall issue Letters of Credit
hereunder and for the account of LTV Steel or one of its Affiliates, as
more specifically described below. No Issuing Lender shall be obligated
to issue any Letter of Credit for the account of LTV Steel or one of
its Affiliates:
(i) if, after giving effect to such issuance, the
aggregate of Letter of Credit Usage together with the
aggregate principal amount of Class A-1 Notes then held by the
Note Purchasers under Article II of this Agreement would
exceed the Aggregate Commitment Amount then in effect;
(ii) if, after giving effect to such issuance, the
sum of (i) such Financing Party's Pro Rata Portion of the
aggregate Letter of Credit Usage and (ii) the aggregate
principal amount of Class A-1 Notes held by such Financing
Party as a Note Purchaser would exceed such Financing Party's
Commitment;
(iii) if, after giving effect to such issuance, the
Letter of Credit Usage in respect of Letters of Credit assumed
under SECTION 3.1(a) or issued under SECTION 3.1(b)(x) in
respect of obligations relating to TBT Lease Agreements (the
"TBT Letters of Credit") would exceed the aggregate Letter of
Credit Usage in respect of all such Letters of Credit on the
Effective Date;
(iv) unless otherwise agreed to by the relevant
Financing Party in its capacity as an Issuing Lender, having a
stated expiration date later than the date which is five
Business Days prior to the Expiration Date applicable to the
Commitment of such Financing Party;
(v) denominated in a currency other than Dollars;
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(vi) if any order, judgment or decree of any
Governmental Authority or arbitrator shall purport by its
terms to enjoin or restrain such Issuing Lender from issuing
such Letter of Credit or any Requirement of Law applicable to
such Issuing Lender or any request or directive (whether or
not having the force of law) from any Governmental Authority
with jurisdiction over such Issuing Lender shall prohibit, or
request such Issuing Lender to refrain from, the issuance of
letters of credit generally or such Letter of Credit in
particular;
(vii) if such Issuing Lender shall have received
written notice from the Administrative Agent or the Required
Financing Parties that any applicable condition set forth in
SECTIONS 5.1 and 5.2 is not then satisfied;
(viii) if the requirement of SECTION 3.9 of this
Agreement is not then satisfied;
(ix) if the Amortization Date shall have occurred;
(x) if, as indicated on the most recent Sales and
Valuation Report, the Company is not in compliance with the
Note Collateral Value Requirement; or
(xi) if after giving effect to such issuance, the
aggregate Letter of Credit Usage would exceed the aggregate
Letter of Credit Limit of all Financing Parties.
Section 3.2. TERMS OF LETTERS OF CREDIT. The Letters of Credit shall be
in a form customarily issued by the respective Issuing Lender or in such other
form as has been approved by such Issuing Lender. At the time of issuance, the
amount and the terms and conditions of each Letter of Credit, and the form of
any drafts or acceptances thereunder, shall be subject to approval by the Agent
and LTV Steel. In no event may the term of any Letters of Credit issued
hereunder exceed 12 months (except that such Letters of Credit may provide for
annual renewal) and, unless otherwise agreed to by the relevant Financing Party
in its capacity as Issuing Lender, all Letters of Credit issued by any Issuing
Lender hereunder shall expire no later than the date which is five Business Days
prior to the Expiration Date applicable to the Commitment of such Financing
Party. Any Letter of Credit containing an automatic renewal provision shall,
unless otherwise agreed to by the relevant Financing Party in its capacity as
Issuing Lender, also contain a provision pursuant to which, notwithstanding any
other provisions thereof, it shall expire no later than the date that is five
Business Days prior to the Expiration Date applicable to the Commitment of such
Financing Party.
Section 3.3. LENDER'S PARTICIPATION. Immediately upon the issuance or
assumption by any Issuing Lender of any Letter of Credit, each Lender shall be
deemed to have irrevocably and unconditionally purchased and received from such
Issuing Lender, without recourse or warranty, an undivided interest and
participation to the extent of such Lender's Pro Rata Portion of the liability
with respect to such Letter of Credit (including, without limitation, all
obligations of LTV
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Steel with respect thereto, other than amounts owing to such Issuing Lender
consisting of Fronting Fees or LC Administration Fees) and any security therefor
or guaranty pertaining thereto.
Section 3.4. REQUEST FOR ISSUANCE. Whenever LTV Steel desires the
issuance of a Letter of Credit, LTV Steel shall deliver to the Administrative
Agent and the respective Issuing Lenders a written notice no later than 1:00
P.M. (New York City time) at least three Business Days (or such shorter periods
as may be agreed to by such Issuing Lenders) in advance of the proposed date of
issuance of a letter of credit request in substantially the form of Exhibit A (a
"Letter of Credit Request"). The Administrative Agent shall promptly transmit
copies of each Letter of Credit Request to each Lender. The transmittal by LTV
Steel of each Letter of Credit Request shall be deemed to be a representation
and warranty that the Letter of Credit may be issued in accordance with and will
not violate any of the requirements of SECTION 3.1 or SECTION 5.2. A Letter of
Credit Request may be given in writing or electronically with prompt
confirmation in writing.
Section 3.5. PAYMENT OF AMOUNTS DRAWN UNDER LETTERS OF CREDIT. In the
event of any request for drawing under any Letter of Credit by the beneficiary
thereof, the respective Issuing Lender shall notify the Administrative Agent,
which shall notify LTV Steel of such request, not later than 11:00 A.M. (New
York City time) on the Business Day immediately prior to the date on which such
Issuing Lender intends to honor such drawing. LTV Steel shall reimburse such
Issuing Lender not later than the close of business (New York City time) on the
day on which such drawing is honored in an amount in same day funds equal to the
amount of such drawing. If for any reason, reimbursement is not received by such
Issuing Lender on such date in an amount equal to the amount of such drawing,
LTV Steel shall be obligated to and shall reimburse such Issuing Lender, on the
Business Day immediately following the date of such drawing, in an amount in
same day funds equal to the amount of such drawing plus accrued interest on such
amount at the rate set forth in SECTION 4.1.
Section 3.6. PAYMENT BY LENDERS; DEFAULTING LENDERS. (a) In the event
that LTV Steel does not reimburse an Issuing Lender for the amount of any
drawing pursuant to SECTION 3.5, the Administrative Agent shall promptly notify
each Lender of the unreimbursed amount and of such Lender's participation
therein based on such Lender's Pro Rata Portion thereof. Each Lender shall make
available to such Issuing Lender an amount equal to its respective participation
in same day funds, at the office of such Issuing Lender specified in such
notice, not later than 1:00 P.M. (New York City time) on the Business Day after
the date notified by the Administrative Agent. In the event that any Lender
fails to make available to such Issuing Lender the amount of such Lender's
participation in such Letters of Credit as provided in this SECTION 3.6(a), such
Issuing Lender shall be entitled to recover such amount on demand from such
Lender, together with interest at the Federal Funds Rate.
(b) The Administrative Agent or the respective Issuing Lender,
as the case may be, shall distribute to each Lender which has paid all
amounts payable by it under SECTION 3.6(a) with respect to any Letter
of Credit such Lender's Pro Rata Portion of all payments subsequently
received by the Administrative Agent or the Issuing Lender, as the case
may
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be, from LTV Steel or from the realization on the Class A-1 Notes
pledged to secure LTV Steel's reimbursement obligation in reimbursement
of drawings honored under such Letters of Credit or from the Guaranty
when such amounts are received.
(c) Notwithstanding anything contained in this Agreement to
the contrary, so long as any Lender shall be in default in its
obligation to fund its Pro Rata Portion of any unreimbursed drawing
under a Letter of Credit or shall have rejected or disavowed its
Commitment as a Financing Party (each such Lender, a "Defaulting
Lender"), then such Defaulting Lender shall not be entitled to receive
any Reimbursement Payments or any Unused Line Fee or any interest on
unreimbursed drawings or its participation in any drawing or its share
of any Fees payable hereunder, and shall not be entitled to share in
payments pursuant to SECTION 4.8, and for purpose of voting or
consenting to matters with respect to the Transaction Documents, such
Defaulting Lender shall be deemed not to be a "Lender" or "Financing
Party" hereunder and such Financing Party's Commitment shall be deemed
to be zero, unless and until (i) all Commitments have been terminated
and all Obligations payable to Financing Parties which are not
Defaulting Lenders have been fully paid, (ii) such failure to fulfill
its obligation to fund is cured and such Defaulting Lender shall have
paid, as and to the extent provided in this SECTION 3.6, to the
applicable party, if any, interest on the amount of funds that such
Defaulting Lender failed to timely fund and such Defaulting Lender
shall no longer reject or disavow its Commitment as a Financing Party
or (iii) the Obligations shall have been declared or shall have become
immediately due and payable. No Commitment of any Financing Party shall
be increased or otherwise affected by any such failure or rejection or
disavowment by any Defaulting Lender. Nothing herein shall be deemed to
relieve any Financing Party from its duty to fulfill its Commitment and
other obligations hereunder or to prejudice any rights which LTV Steel
or any of its Affiliates or any Issuing Lender may have against any
Financing Party as a result of any default by such Financing Party
hereunder. Any reimbursement payments or interest payments which would,
but for this paragraph, be paid to any Lender, shall be paid to the
Lenders who are not Defaulting Lenders, for application to the
unreimbursed drawings or to provide cash collateral in such manner and
order as shall be determined by the Administrative Agent. The
provisions of this clause (c) are intended merely to bind Lenders and,
except as provided in the second preceding sentence, are not intended
to benefit LTV Steel or any of its Affiliates, do not grant LTV Steel
or any of its Affiliates any rights and may be waived by the
Administrative Agent and the Required Financing Parties without the
consent of LTV Steel or any of its Affiliates.
Section 3.7. NATURE OF ISSUING LENDER'S DUTIES. In determining whether
to pay under any Letter of Credit, each Issuing Lender shall be responsible only
to determine that the documents and certificates required to be delivered under
such Letter of Credit have been delivered and that they comply on their face
with the requirements of such Letter of Credit. As between LTV Steel, any
Issuing Lender and each other Lender, LTV Steel assumes all risks of the acts
and omission of, or misuse of the Letter of Credit issued by each Issuing Lender
by, the beneficiaries of such Letter of Credit. In furtherance and not in
limitation of the foregoing, no Issuing Lender nor any
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of the other Lenders shall be responsible (i) for the form, validity,
sufficiency, accuracy, genuineness or legal effects of any document submitted by
any party in connection with the application for and issuance of or any drawing
honored under such Letter of Credit even if it should in fact prove to be in any
or all respects invalid, insufficient, inaccurate, fraudulent or forged, (ii)
for the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign such Letter of Credit, or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason, (iii) for failure of the beneficiary
of such Letter of Credit to comply fully with conditions required in order to
draw upon such Letter of Credit, (iv) for errors, omissions, interruptions or
delays in transmission or delivery of any messages, by mail, cable, telegraph,
telex, telecopy or otherwise, whether or not they be in cipher, (v) for errors
in interpretation of technical terms, (vi) for any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under any such Letter of Credit, or of the proceeds thereof, (vii) for the
misapplication by the beneficiary of such Letter of Credit of the proceeds of
any drawing honored under such Letter of Credit and (viii) for any consequences
arising from actions or omissions taken or omitted in good faith or from causes
beyond the control of such Issuing Lender or the other Lenders; PROVIDED,
HOWEVER, that nothing in this sentence shall relieve any Issuing Lender of
liability for its own gross negligence or willful misconduct.
Section 3.8. OBLIGATIONS ABSOLUTE. The obligation of LTV Steel to
reimburse an Issuing Lender for drawings honored under a Letter of Credit issued
by it, and the obligations of the Lenders under SECTION 3.6, shall be
unconditional and irrevocable and shall be paid strictly in accordance with the
terms of this Agreement under all circumstances including, without limitation,
the following circumstances:
(i) any lack of validity or enforceability of any
Letters of Credit;
(ii) the existence of any claim, set-off, defense or
other right which LTV Steel or any of its Affiliates may have
at any time against a beneficiary or any transferee of any
Letter of Credit (or any Persons or entities for whom any such
beneficiary or transferee may be acting), such Issuing Lender,
any Lender or any other Person, whether in connection with
this Agreement, the transactions contemplated herein or any
unrelated transaction; provided that nothing herein shall
prevent the assertion of any such claim, set-off, defense or
other right by separate suit or compulsory counterclaims;
(iii) any draft, demand, certificate or any other
documents presented under any 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 Transaction Documents;
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(v) payment by such Issuing Lender under any Letters
of Credit against presentation of a demand, draft or
certificate or other document which does not comply with the
terms of such Letters of Credit;
(vi) failure of any drawing under a Letter of Credit
or any non-application or misapplication by the beneficiary of
the proceeds of any drawing;
(vii) the fact that a Note Purchase Agreement Default
or Note Purchase Agreement Event of Default shall have
occurred and be continuing; or
(viii) any adverse change in the business,
operations, properties, assets, condition (financial or
otherwise) or prospects of LTV Steel or any of its Affiliates;
provided, however, that LTV Steel shall have no obligation to reimburse an
Issuing Lender and the Lenders shall have no obligation under SECTION 3.6, in
the event of such Issuing Lender's willful misconduct or gross negligence in
determining whether documents presented under the Letter of Credit comply with
the terms of such Letter of Credit or with respect to any other express
obligation such Issuing Lender may have under this Agreement in making any
payment pursuant to any Letter of Credit.
Section 3.9. COLLATERALIZATION. (a) To secure the obligations of LTV
Steel to the Issuing Lenders for reimbursement of drawings under the Letters of
Credit, interest due thereon and to the Issuing Lenders and the Lenders for the
payment of fees under SECTION 4.3 of this Agreement, LTV Steel grants to the
Collateral Agent on behalf of the Issuing Lenders and Lenders a first priority
security interest in a principal amount of Class A-1 Notes bearing interest at
the Pledge Rate equal to or in excess of the Stated Amount of such Letter of
Credit and shall cause the Collateral Agent to make appropriate notation in the
Note Register to reflect the interest of the Issuing Lenders and the Lenders
with respect to such Class A-1 Notes. At any time that any reimbursement
obligations of LTV Steel with respect to a Letter of Credit are due but unpaid,
all amounts payable on such pledged Class A-1 Notes shall be payable to the
Collateral Agent on behalf of the Issuing Lenders and Lenders as a Reimbursement
Payment. The Collateral Agent shall release from such lien Notes or Note
Portions as and to the extent the Stated Amount of any Letter of Credit is
reduced or any Letter of Credit is terminated. During the period that such Class
A-1 Notes are so pledged to Issuing Lenders, LTV Steel hereby grants to such
Issuing Lenders the right to vote such Class A-1 Notes for all purposes under
the Trust Agreement.
(b) LTV Steel shall take all actions necessary to obtain and
maintain, for the benefit of the Collateral Agent on behalf of the
Issuing Lenders and Lenders, a first lien on and a first priority,
perfected security interest in such pledged Class A-1 Notes. LTV Steel
will from time to time execute and deliver all such supplements and
amendments hereto and all such financing statements, continuation
statements, instruments of further assurance and other instruments, and
will take such other action necessary or advisable
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under Articles 8 and 9 of the Uniform Commercial Code as in effect in
all relevant jurisdictions to:
(i) grant more effectively the Lien contemplated
herein on all or any portion of the pledged Class A-1 Notes;
(ii) maintain or preserve the lien and security
interest (and the priority thereof) created by this Agreement
or carry out more effectively the purposes hereof;
(iii) perfect, publish notice of or protect the
validity of any pledge made or to be made by this Agreement;
(iv) enforce any of the pledged Class A-1 Notes; and
(v) preserve and defend the rights of the Collateral
Agent and the Issuing Lenders or Lenders in such pledged Class
A-1 Notes against the claims of all persons and parties.
LTV Steel hereby designates the Collateral Agent its agent and attorney-in-fact
to execute all financing statements, continuation statements or other
instruments required to be executed pursuant to this Section.
(c) LTV Steel represents and warrants to the Collateral Agent,
the Issuing Lenders and the Lenders that (i) all action necessary to
create, protect and perfect the Collateral Agent's security interest in
such pledged Class A-1 Notes, as contemplated by this Agreement, has
been duly and effectively taken (or will be taken within ten days of
the Effective Date), and (ii) all action necessary or desirable
(including, without limitation, the filing of appropriately completed
UCC financing statements in each appropriate office in each applicable
jurisdiction) has been duly taken (or will be taken within ten days of
the Effective Date) to perfect the liens created by this Agreement to
the effect that a valid and continuing perfected security interest has
been created in such pledged Class A-1 Notes, in favor of the
Collateral Agent for the benefit of the Issuing Lenders and Lenders,
prior to all other liens, claims and rights of others.
Section 3.10. AMENDMENTS TO LETTER OF CREDIT. LTV Steel may request
that the Issuing Lender that issued a Letter of Credit enter into one or more
amendments of such Letter of Credit by delivering to the Administrative Agent
and such Issuing Lender a written notice specifying (i) the Issuing Lender, (ii)
the proposed date of the amendment and (iii) the requested amendment. Any
Issuing Lender shall be entitled to enter into amendments with respect to
Letters of Credit; PROVIDED, HOWEVER, that unless otherwise agreed by the
relevant Financing Party in its capacity as Issuing Lender, no such amendment
may extend the stated expiration date of any Letter of
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Credit issued by such Issuing Lender beyond the date which is five Business Days
prior to the Expiration Date applicable to the Commitment of such Financing
Party.
Section 3.11. THE REGISTER. (a) The Administrative Agent shall
maintain, at its Notice Address, a register for the recordation of the names and
addresses of Financing Parties and the Commitments and Letters of Credit (and
participations therein) of each Financing Party from time to time (the "Lender
Register"). LTV Steel, the Administrative Agent, the Collateral Agent and the
Lenders may treat each Person whose name is recorded in the Lender Register as a
Lender hereunder for all purposes of this Agreement and the other Transaction
Documents. The Lender Register shall be available for inspection by LTV Steel,
the Agent, or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
(b) The Administrative Agent shall record in the Lender
Register the Commitment and the participations in Letters of Credit
from time to time of each Financing Party and reimbursement payment in
respect of a Letter of Credit. Any such recordation shall be conclusive
and binding on LTV Steel and each Lender, absent manifest error;
provided that failure to make any such recordation, or any error in
such recordation, shall not affect the Obligations of LTV Steel.
Section 3.12. COMMITMENT REDUCTIONS. (a) On the Expiration Date
applicable to the Commitment of any Financing Party, the Commitment of such
Financing Party shall automatically reduce to zero.
(b) On any Business Day, upon two days prior written notice to
the Administrative Agent and the Financing Parties, LTV Steel may
reduce the Aggregate Commitment Amount hereunder to zero or such other
amount as LTV Steel shall specify in such notice, provided that if the
Aggregate Commitment Amount is reduced to an amount that is less than
the total of the aggregate Letter of Credit Usage at such time together
with the principal amount of Class A-1 Notes as to which the Note
Purchasers are the Holders, LTV Steel shall deliver such notice at
least three Business Days before the proposed effective date of such
reduction and shall, first, repurchase such principal amount of Class
A-1 Notes as to which the Note Purchasers are the Holders and second,
reduce the aggregate Letter of Credit Usage (in which event LTV Steel
shall specify in such notice the Letters of Credit whose face amount is
to be reduced or are to be terminated in connection therewith; provided
that such reduction or termination may be made in accordance with the
terms of the applicable Letter of Credit) to the extent necessary such
that the Aggregate Commitment Amount, as reduced, shall not be less
than the total of the aggregate Letter of Credit Usage plus the
principal amount of Class A-1 Notes as to which the Note Purchasers are
the Holders, in each case after giving effect to all repurchases of
Class A-1 Notes and reductions of the aggregate Letter of Credit Usage
to be made in connection with such reduction of the Aggregate
Commitment Amount.
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(c) All reductions to the Aggregate Commitment Amount under
this SECTION 3.12 shall reduce the Commitments of the Financing Parties
on a PRO RATA basis.
Section 3.13. INDEMNIFICATION OF ISSUING LENDERS. To the extent any
Issuing Lender is not reimbursed and indemnified by LTV Steel, each Lender will
reimburse and indemnify such Issuing Lender, with respect to each Letter of
Credit issued by it, for and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses
(including counsel fees and disbursements) or disbursements of any kind or
nature whatsoever (including all Expenses) which may be imposed on, incurred by
or asserted against such Issuing Lender in performing its duties hereunder, in
any way relating to or arising out of this Agreement; provided, that no Lender
shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
in excess of such Lender's Pro Rata Portion or resulting from such Issuing
Lender's gross negligence or willful misconduct.
ARTICLE IV
INTEREST, FEES, EXPENSES AND PAYMENTS
Section 4.1. PAYMENT OF INTEREST. LTV Steel agrees to pay to each
Issuing Lender, with respect to drawings made under any Letters of Credit issued
by it, interest on the amount paid by such Issuing Lender in respect of each
such drawing from the date of such drawing through the date such amount is
reimbursed at a rate per annum equal to the ABR (plus 2% from and after the
second Business Day following such drawing), as in effect from time to time.
Each determination by the Administrative Agent of an interest rate hereunder
shall be conclusive and binding for all purposes, absent manifest error.
Section 4.2. REIMBURSEMENT OF EXPENSES; OTHER FEES. (a) From and after
the Effective Date, LTV Steel shall promptly reimburse the Placement Agent and
the Administrative Agent for all Expenses of such Agents as the same are
incurred and upon receipt of invoices therefor.
(b) LTV Steel shall pay to the Placement Agent and the
Administrative Agent such fees and other amounts as may be agreed among
LTV Steel and such Agents from time to time.
Section 4.3. FEES IN RESPECT OF LETTERS OF CREDIT. (a) Subject to the
provisions of SECTION 4.3(b), LTV Steel agrees to pay to the Administrative
Agent for distribution to each of the Lenders (other than a Defaulting Lender
for so long as such Lender is a Defaulting Lender) a fee in respect of each
Letter of Credit issued hereunder (the "Letter of Credit Fee"), for the period
from and including the date of issuance of such Letter of Credit to and
including the termination of such Letter of Credit, computed at a rate per annum
equal to the Utilized Portion Rate on such Lender's Pro Rata Portion of the
daily average Stated Amount of such Letter of Credit. Accrued Letter of Credit
Fees in respect of Letters of Credit shall be due and payable quarterly in
arrears on the second Business Day following the last Business Day of each
March, June, September and
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December, and upon the Expiration Date applicable to the Commitment of the
relevant Financing Party, or if earlier, the first day on or after the
termination of the Aggregate Commitment Amount upon which no Letters of Credit
remain outstanding.
(b) Letter of Credit Fees shall be, as of the date a Note
Purchase Agreement Event of Default occurs and at all times thereafter
until the earlier of the date upon which (x) all Obligations have been
paid and satisfied in full and all Letters of Credit have been
terminated and (y) such Note Purchase Agreement Event of Default shall
have been cured or waived in accordance with this Agreement, payable at
a rate per annum equal to the rate at which the Letter of Credit Fees
are charged pursuant to clause (a) above plus 2%.
(c) LTV Steel agrees to pay to each Issuing Lender, for its
own account, a fronting fee in respect of each Letter of Credit issued
by it hereunder (the "Fronting Fee") for the period from and including
the date of issuance of such Letter of Credit to and including the
termination of such Letter of Credit, computed at a rate equal to
0.125% per annum on the daily average Stated Amount of such Letter of
Credit. Accrued Fronting Fees shall be due and payable quarterly in
arrears on the date which is the second Business Day following the last
Business Day of each March, June, September and December, and upon the
Expiration Date applicable to the Commitment of the relevant Financing
Party, or if earlier, the first day on or after the termination of the
Aggregate Commitment Amount upon which no Letter of Credit remains
outstanding.
(d) LTV Steel shall pay, upon each drawing under, issuance of,
or amendment to, any Letter of Credit, such amount as shall at the time
of such event be identified to LTV Steel as the administrative charge
which the respective Issuing Lender is generally imposing in connection
with such occurrence with respect to letters of credit (the "LC
Administration Fees").
Section 4.4. UNUSED LINE FEE. LTV Steel shall pay to the Administrative
Agent for the benefit of each of the Financing Parties (other than a Defaulting
Lender for so long as such Financing Party is a Defaulting Lender) a
non-refundable fee (the "Unused Line Fee") equal to the Unused Line Fee Rate on
the Unused Portion of such Financing Party's Commitment (such "Unused Portion"
to refer to the excess, if any, of such Financing Party's Commitment over the
sum of the Pro Rata Portion of such Financing Party of (i) the aggregate Letter
of Credit Usage plus (ii) the aggregate principal amount of Notes as to which
the Note Purchasers are Holders at such time), which fee shall (i) accrue from
the Effective Date until the Expiration Date applicable to the Commitment of
such Financing Party (or such earlier date as the Aggregate Commitment Amount is
terminated) and (ii) be due and payable quarterly in arrears on the second
Business Day following the last Business Day of March, June, September and
December, and on the Expiration Date applicable to such Financing Party's
Commitment (or such earlier date as the Aggregate Commitment Amount is
terminated).
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Section 4.5. INDEMNIFICATION IN CERTAIN EVENTS. (a) If after the
Effective Date, either (i) any change in or in the interpretation of any law or
regulation is introduced, including, without limitation, with respect to reserve
requirements, applicable to the Placement Agent, the Administrative Agent, any
Financing Party (whether in its capacity as Note Purchaser, Issuing Lender or
Lender) (or, in the case of a Financing Party which is not a banking
institution, any affiliate of such Financing Party funding such Financing Party
(a "Funding Affiliate") (each an "Article IV Party")), (ii) any Article IV Party
complies with any future guideline or request from any central bank or other
Governmental Authority or (iii) any Article IV Party reasonably determines that
the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change therein, or any change in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof after the
Effective Date has or would have the effect described below, or an Article IV
Party complies with any future request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, and in the case of any event set forth in this clause (iii),
such adoption, change or compliance has or would have the direct or indirect
effect of reducing the rate of return on such Article IV Party's capital as a
consequence of its obligations hereunder to a level below that which such
Article IV Party could have achieved but for such adoption, change or compliance
(taking into consideration such Article IV Party's policies with respect to
capital adequacy) by an amount deemed by such Article IV Party to be material,
and any of the foregoing events described in clauses (i), (ii) or (iii)
increases the cost to an Article IV Party for (a) funding or maintaining its
Commitment or (b) purchasing or maintaining any participation therein, or
reduces the amount receivable in respect thereof by such Article IV Party, then
LTV Steel shall within 10 days after demand by the respective Agent pay such
Article IV Party additional amounts sufficient to indemnify such Article IV
Party on an after-tax basis against such increase in cost or reduction in
amounts receivable allocable to such Article IV Party's funding or maintaining
its Commitment or issuing, making or maintaining any Letter of Credit or
purchasing or maintaining any participation therein. A certificate as to the
amount of such increased cost and setting forth in reasonable detail the
calculation thereof shall be submitted to LTV Steel by an Article IV Party and
shall be conclusive absent manifest error.
(b) Each Article IV Party will notify LTV Steel and the
Placement Agent or the Agent (or the Placement Agent or the
Administrative Agent shall notify LTV Steel) of any event occurring
after the Effective Date which will entitle such party to payment
pursuant to SECTION 4.5(a) as promptly as practicable after it obtains
knowledge thereof, specifying the event giving rise to such claim and
setting out in reasonable detail an estimate of the basis and
computation of such claim. Upon receipt of such notice, LTV Steel shall
compensate such Article IV Party in accordance with SECTION 4.5(a) from
the date such costs are incurred (including, without limitation, where
such costs are retroactively applied).
(c) Each Article IV Party agrees that upon the occurrence of
any event giving rise to the operation of this SECTION 4.5 with respect
to such party, it will, if requested by
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LTV Steel, use reasonable efforts (subject to overall policy
considerations of such party) to designate another lending office of
such Article IV Party, PROVIDED that such designation is made on such
terms that such party and its lending office suffer no economic, legal
or regulatory disadvantage, with the object of avoiding the consequence
of the event giving rise to the operation of this Section. Nothing in
this clause (c) shall affect or postpone any of the obligations of LTV
Steel or the rights of any Article IV Party provided in this SECTION
4.5.
(d) Notwithstanding the above or SECTION 11.8, SECTION 4.7
hereof shall govern all indemnifications with respect to events
affecting taxes and interest and penalties related thereto.
Section 4.6. CALCULATIONS. All calculations of (i) interest hereunder
and (ii) Fees, including, without limitation, Unused Line Fees, Letter of Credit
Fees and Fronting Fees, shall be made by the Administrative Agent on the basis
of a year of 360 days, or, if such computation would cause the interest and fees
chargeable hereunder to exceed the Highest Lawful Rate, 365/366 days, in each
case for the actual number of days elapsed (including the first day but
excluding the last day) occurring in the period for which such interest or fees
are payable. Each determination by the Administrative Agent of an interest rate
or payment hereunder shall be conclusive and binding for all purposes, absent
manifest error.
Section 4.7. TAXES. (i) Any and all payments by LTV Steel hereunder and
under the other Transaction Documents which are made to or for the benefit of
any Financing Party (whether in its capacity as Note Purchaser, Lender or
Issuing Lender), the Placement Agent or the Administrative Agent (each a
"SECTION 4.7 Party") shall be made, free and clear of and without deduction for
any and all present or future taxes, levies, imposts, deductions, charges or
withholdings and penalties, interests and all other liabilities with respect
thereto imposed by any jurisdiction from or through which payments originate or
are made ("Taxes"), excluding, (a) in the case of each such party, taxes imposed
on its net income or net profits (including, without limitation, any taxes
imposed on branch profits) and franchise or similar taxes imposed on it by the
jurisdiction under the laws of which it is organized or in which its principal
executive office is located or, in each case, any political subdivision thereof,
(b) in the case of each SECTION 4.7 Party, taxes imposed on its net income or
net profits (including, without limitation, any taxes imposed on branch
profits), and franchise or similar taxes imposed on it, by the jurisdiction of
such Person's applicable lending office or any political subdivision thereof,
(c) in the case of each SECTION 4.7 Party any Taxes that are in effect and that
would apply to a payment to such party, as of the Effective Date, (d) in the
case of each Section 4.7 Party, taxes imposed by reason of doing business in the
jurisdiction imposing such tax, other than as a result of this Agreement or any
Note or any transaction contemplated hereby, and (e) if any Person acquires any
interest in this Agreement or any Obligations pursuant to the provisions hereof,
or any Financing Party organized in a jurisdiction outside the United States of
America (each a "Foreign Financing Party") changes the office in which any
purchase of a Note or Letter of Credit is issued, accounted for or booked (any
such Person or such Foreign Financing Party in that event being referred to as a
"Tax
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Transferee"), any Taxes to the extent that they are in effect and would apply to
a payment to such Tax Transferee as of the date of the acquisition of such
interest or change in office, as the case may be (all such nonexcluded Taxes
being hereinafter referred to as "Covered Taxes"). If LTV Steel shall be
required by law to deduct any Covered Taxes from or in respect of any sum
payable hereunder to or for the benefit of any SECTION 4.7 Party or Tax
Transferee (A) the sum payable shall be increased as may be necessary so that
after making all required deductions of Covered Taxes (including deductions of
Covered Taxes applicable to additional sums payable under this SECTION 4.7) such
Financing Party, Tax Transferee, the Placement Agent or the Administrative
Agent, as the case may be, receives an amount equal to the sum it would have
received had no such deductions been made, (b) LTV Steel shall make such
deductions and (C) LTV Steel shall pay the full amount so deducted to the
relevant taxation authority or other authority in accordance with applicable
law.
(ii) In addition, LTV Steel agrees to pay any present
or future stamp, documentary, excise, privilege, or similar
levies that arise at any time or from time to time from any
payment made under any and all Transaction Documents, or from
the execution or delivery by LTV Steel of, or from the filing
or recording or maintenance of, or otherwise with respect to
the exercise by the SECTION 4.7 Parties of their rights under,
any and all Transaction Documents (hereinafter referred to as
"Other Taxes").
(iii) LTV Steel will indemnify each SECTION 4.7 Party
and Tax Transferee for the full amount of Covered Taxes
imposed on or with respect to amounts payable hereunder and
Other Taxes. Payment of this indemnification shall be made
within 30 days from the date such SECTION 4.7 Party or Tax
Transferee delivers a certificate to LTV Steel certifying and
setting forth in reasonable detail the calculation thereof as
to the amount and type of such Taxes provided, however, that
the LTV Steel shall not be obligated to make payment to such
Section 4.7 Party or Tax Transferee (as the case may be)
pursuant to this Section in respect of penalties, interest and
other liabilities attributable to any Covered Taxes or Other
Taxes, if (i) written demand therefor has not been made by
such Section 4.7 Party or Tax Transferee within 60 days from
the date on which such Section 4.7 Party or Tax Transferee
knew or should have known of the imposition of Covered Taxes
or Other Taxes by the relevant taxing or governmental
authority, (ii) such penalties, interest and other liabilities
have accrued after LTV Steel has indemnified or paid any
additional amount pursuant to this Section or (iii) such
penalties, interest and other liabilities are attributable to
the gross negligence or wilful misconduct of the Section 4.7
Party or Tax Transferee. After the Section 4.7 Party or Tax
Transferee (as the case may be) learns of the imposition of
Tax or Other Taxes, such Section 4.7 Party or Tax Transferee
will act in good faith to promptly notify LTV Steel of its
obligations hereunder. Any such certificate submitted by such
SECTION 4.7 Party or Tax Transferee in good faith to LTV Steel
shall, absent manifest error, be final, conclusive and binding
on all parties.
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(iv) If a Section 4.7 Party or Tax Transferee shall
become aware that it is entitled to receive a refund or credit
from a relevant taxing or governmental authority in respect of
Covered Taxes or Other Taxes as to which it has been
indemnified by LTV Steel pursuant to this Section, it shall
promptly notify LTV Steel of the availability of such refund
or credit and shall, within 30 days after receipt of a request
by LTV Steel (whether as a result of notification that it has
made to LTV Steel or otherwise), make a claim to such taxing
or governmental authority for such refund or credit at LTV
Steel's expense. If such Section 4.7 Party or Tax Transferee
receives a refund or credit in respect of any Covered Taxes or
Other Taxes as to which it has been indemnified by LTV Steel
pursuant to this Section, or with respect to which LTV Steel
has paid additional amounts pursuant to this Section, it shall
promptly notify LTV Steel of such refund or credit and shall
within 30 days from the date of receipt of such refund or
benefit of such credit pay over the amount of such refund or
benefit of such credit (including any interest paid or
credited by the relevant taxing or governmental authority with
respect to such refund or credit) to LTV Steel (but only to
the extent of indemnification payments made, or additional
amounts paid, by LTV Steel under this Section with respect to
the Covered Taxes or Other Taxes giving rise to such refund or
credit), net of all out-of-pocket expenses of such Section 4.7
Party or Tax Transferee and without interest; PROVIDED,
HOWEVER, that LTV Steel, upon the request of such Section 4.7
Party or Tax Transferee, agrees to repay the amount paid over
to LTV Steel (plus penalties, interest or other charges due to
the appropriate authorities in connection therewith) to such
Section 4.7 Party or Tax Transferee in the event such Section
4.7 Party or Tax Transferee is required to repay such refund
or credit to such relevant authority.
(v) Within 30 days after having received a receipt
for Covered Taxes or Other Taxes, LTV Steel will furnish to
the Placement Agent or the Administrative Agent, at its Notice
Address, the original or a certified copy of such receipt or
any other document evidencing payment thereof to the extent
such receipt is legally available.
(vi) On or before the Effective Date, each Foreign
Financing Party shall deliver to the Agents and LTV Steel (i)
two valid, duly completed copies of IRS Form 1001 or 4224 or
successor applicable form, as the case may be, and any other
required form, certifying in each case that such Foreign
Financing Party is entitled to receive payments under this
Agreement payable to it without deduction or withholding of
any United States federal income taxes or with such
withholding imposed at a reduced rate (the "Reduced Rate"),
and (ii) to the extent required in order to establish an
exemption from United States backup withholding tax, a valid,
duly completed IRS Form W-8 or W-9 or successor applicable
form, as the case may be. Each such Foreign Financing Party
shall also deliver to the Agents and LTV Steel two further
copies of said Form 1001 or 4224 and W-8 or W-9, or
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successor applicable forms, or other manner of required
certification, as the case may be, on or before the date that
any such form expires or becomes obsolete or otherwise is
required to be resubmitted as a condition to obtaining an
exemption from a required withholding of United States federal
income tax or entitlement to having such withholding imposed
at the Reduced Rate or after the occurrence of any event
requiring a change in the most recent form previously
delivered by it to LTV Steel and the Agents, and such
extensions or renewals thereof as may reasonably be requested
by LTV Steel or any Agent, (a) certifying in the case of a
Form 1001 or 4224 that such Foreign Financing Party is
entitled to receive payments under this Agreement payable to
it without deduction or withholding of any United States
federal income taxes, unless in any such case any change in a
tax treaty to which the United States is a party, or any
change in law or regulation of the United States or official
interpretation thereof has occurred after the Effective Date
and prior to the date on which any such delivery would
otherwise be required that renders all such forms inapplicable
or that would prevent such Foreign Financing Party from duly
completing and delivering any such form with respect to it,
and such Foreign Financing Party advises LTV Steel and the
Agents that it is not capable of receiving payments without
any deduction or withholding at the Reduced Rate and (b) in
the case of a Form W-8 or W-9, establishing an exemption from
United States backup withholding tax.
(vii) If a Tax Transferee that is organized under the
laws of a jurisdiction outside of the United States acquires
an interest in this Agreement or any Obligation or a Foreign
Financing Party changes the office through which any purchase
of a Note or Letters of Credit are made, accounted for or
booked, the transferor, or the applicable Foreign Financing
Party in the case of a change of office, shall cause such Tax
Transferee to agree that, on or prior to the effective date of
such acquisition or change, as the case may be, it will
deliver to LTV Steel and the Agents (i) two valid, duly
completed copies of IRS Form 1001 or 4224 or successor
applicable form, as the case may be, and any other required
form, certifying in each case that such Tax Transferee is
entitled to receive payments under this Agreement payable to
it without deduction or withholding of United States federal
income tax or with such withholding imposed at a reduced rate;
and (ii) a valid, duly completed IRS Form W- 8 or W-9 or
successor applicable form, as the case may be, to establish an
exemption from United States backup withholding tax. Each Tax
Transferee that delivers to LTV Steel and the Agents a Form
1001 or 4224, and form W-8 or W-9 and any other required form,
pursuant to the next preceding sentence, further undertakes to
deliver two further copies of the said Form 1001 or 4224 and
Form W-8 or W-9, or successor applicable forms, or other
manner of required certification, as the case may be, on or
before the date that any such form expires or becomes obsolete
or otherwise is required to be resubmitted as a condition to
obtaining an exemption from a required withholding of United
States federal income tax or entitlement to having such
withholding
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imposed at the Reduced Rate or after the occurrence of any
event requiring a change in the most recent form previously
delivered by it to LTV Steel and the Agents, and such
extensions or renewals thereof as may reasonably be requested
by LTV Steel or any Agent, (a) certifying in the case of a
Form 1001 or 4224 that such Tax Transferee is entitled to
receive payments under this Agreement without deduction or
withholding of any United States federal income taxes or with
such withholding imposed at the Reduced Rate, unless any
change in treaty, law or regulation or official interpretation
thereof has occurred after the effective date of such
acquisition or change and prior to the date on which any such
delivery would otherwise be required that renders all such
forms inapplicable or that would prevent such Tax Transferee
from duly completing and delivering any such form with respect
to it, and such Tax Transferee advises LTV Steel and the
Agents that it is not capable of receiving payment (1) without
any deduction or withholding of United States federal income
tax or (2) with such withholding at the Reduced Rate, as the
case may be, and (b) in the case of a Form W-8 or W-9,
establishing an exemption from United States backup
withholding tax.
(viii) If a Foreign Financing Party or Tax Transferee
is entitled to an exemption from withholding with respect to
payments to be made to such Foreign Financing Party or Tax
Transferee under this Agreement and does not provide the
applicable certificate demonstrating its right to such
exemption to LTV Steel and the Agents within the time periods
set forth in the two preceding paragraphs, LTV Steel shall
withhold taxes from payments to such Foreign Financing Party
or Tax Transferee at the applicable statutory rates and LTV
Steel shall not be required to pay any additional amounts as a
result of such withholding as provided in this SECTION 4.7;
provided, however, that all such withholding and associated
limitations in payment shall cease upon delivery by such
Foreign Financing Party of such certificate to LTV Steel and
the Agents.
(ix) If any taxes for which LTV Steel would be
required to make payment under this SECTION 4.7 are imposed,
the applicable Financing Party, Placement Agent or
Administrative Agent, as the case may be, at LTV Steel's
request, shall use its reasonable efforts (at LTV Steel's
expense) to avoid or reduce such taxes by taking any
appropriate action, including changing the location of its
applicable lending office to another existing office of such
entity, consistent with its internal policies (including,
without limitation, assigning its rights hereunder to a
related entity or a different office) which would not in the
sole opinion of such Financing Party, Placement Agent or
Administrative Agent be unreasonable or otherwise
disadvantageous to such Financing Party, Placement Agent or
Administrative Agent, as the case may be; provided that the
mere existence of fees, charges, costs or expenses that LTV
Steel has offered and agreed to pay on behalf of such
Financing Party, Placement Agent or Administrative Agent shall
not be deemed to be disadvantageous to such party.
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(x) Each of the Financing Parties, the Placement
Agent, the Administrative Agent and Tax Transferee agrees that
it will (i) take all reasonable actions reasonably requested
by LTV Steel that are without risk or material cost to such
Financing Party, Placement Agent, the Administrative Agent or
Tax Transferee (as the case may be) to maintain all
exemptions, if any, available to it from withholding taxes
(whether available by treaty or existing administrative
waiver), and (ii) to the extent reasonable and without
material cost to it, otherwise cooperate with LTV Steel to
minimize any amounts payable by LTV Steel under this Section.
(xi) Without prejudice to the survival of any other
agreement of LTV Steel hereunder, the agreements and
obligations of LTV Steel contained in this SECTION 4.7 shall
survive the payment in full of the Obligations.
Section 4.8 SHARING OF PAYMENTS. If any Financing Party shall obtain
any payment (whether voluntary, involuntary, through the exercise of any right
of set-off or otherwise) on account of its Notes or its participation in Letters
of Credit in excess of its Pro Rata Portion of payments on account of the Notes
or Letters of Credit obtained by all the Financing Parties (other than any
Financing Party that has waived its Pro Rata Portion thereof in writing), such
Financing Party shall forthwith purchase from the other Financing Parties (other
than any Defaulting Lender) such Notes or participations in Letters of Credit as
shall be necessary to cause such purchasing Financing 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 Financing
Party, such purchase from each other Financing Party shall be rescinded and each
such other Financing Party shall repay to the purchasing Financing Party the
purchase price to the extent of such recovery together with an amount equal to
such other Financing Party's ratable share (according to the proportion of (i)
the amount of such other Financing Party's required repayment to (ii) the total
amount so recovered from the purchasing Financing Party) of any interest or
other amount paid or payable by the purchasing Financing Party in respect to the
total amount so recovered. LTV Steel agrees that any Financing Party so
purchasing a participation from another Financing Party pursuant to this SECTION
4.8 may, to the fullest extent permitted by law, exercise all of its rights of
payment (including the right of set-off) with respect to such participation as
fully as if such Financing Party were the direct creditor of LTV Steel in the
amount of such participation.
ARTICLE V.
CONDITIONS PRECEDENT
Section 5.1. CONDITIONS TO EFFECTIVE DATE, INITIAL ISSUANCE OF LETTERS
OF CREDIT AND OBLIGATION TO PURCHASE CLASS A-1 NOTES. The obligation of the Note
Purchasers to purchase Class A-1 Notes and each Issuing Lender to issue Letters
of Credit hereunder on the Effective Date are, in addition to the conditions
precedent specified in SECTION 2.1(a) with respect to the purchase of
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Class A-1 Notes and SECTION 5.2 with respect to the issuance of Letters of
Credit, subject to the satisfaction of the following conditions precedent:
(a) EXECUTION OF AGREEMENT. On or prior to the Effective Date,
this Agreement shall have become effective as provided in SECTION
11.13.
(b) OFFICER'S CERTIFICATE. On the Effective Date, the Agents
shall have received an Officer's Certificate dated such date of LTV
Steel stating (except to the extent satisfaction of such conditions is
subject to the approval of any Agent or the Collateral Agent) that all
of the applicable conditions set forth in SECTIONS 5.1(f) and (g) and
5.2 exist as of such date.
(c) OPINIONS OF COUNSEL. On the Effective Date, the Agents
shall have received opinions, addressed to the Placement Agent and the
Agent and each of the Financing Parties and dated the Effective Date,
(i) from ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, special counsel to LTV Steel (or in the
case of matters of local law, applicable local counsel), and as to
certain matters, from the general counsel of LTV Steel, which opinion
or opinions shall cover the matters contained in Exhibit B and (ii)
from Winston & ▇▇▇▇▇▇, special counsel to the Financing Parties, which
opinion shall cover the matters contained in Exhibit C.
(d) CORPORATE PROCEEDINGS. (i) On the Effective Date, the
Agents shall have received from LTV Steel a certificate, dated the
Effective Date, signed by the secretary or any assistant secretary of
LTV Steel, in the form of Exhibit D, with appropriate insertions,
together with copies of the Organizational Documents of LTV Steel and
the resolutions of LTV Steel referred to in such certificate and all of
the foregoing shall be satisfactory to the Placement Agent and the
Administrative Agent.
(ii) On the Effective Date, all corporate
and legal proceedings and all instruments and
agreements in connection with the transactions
contemplated by this Agreement and the other
Transaction Documents shall be reasonably
satisfactory in form and substance to the Placement
Agent and the Administrative Agent, and the Agents
shall have received all information and copies of all
certificates and any other records of corporate
proceedings and governmental approvals, if any, which
the Placement Agent and the Administrative Agent
reasonably may have requested in connection
therewith, such documents and papers, where
appropriate, to be certified by proper corporate or
governmental authorities.
(e) TRANSACTION DOCUMENTS. On the Effective Date, the Agents
shall have received true, correct and complete copies of each of the
Transaction Documents, including all exhibits and schedules thereto,
and the Transaction Documents shall be in the form previously approved
by the Agents and distributed to the Financing Parties prior to the
date hereof. Each of the Transaction Documents shall be in full force
and effect, and
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all conditions precedent shall have been satisfied and not waived
(unless waived by the Placement Agent and the Administrative Agent).
The Agents shall have received copies of all certificates and opinions
delivered in connection with the Transaction Documents.
(f) EXISTING TBT LETTER OF CREDIT AGREEMENT.
(i) On the Effective Date and concurrently
with the issuance of any Letters of Credit, the
commitments under the Existing TBT Letter of Credit
Agreement shall have been terminated, all letters of
credit issued thereunder shall have been terminated,
assumed or replaced, or LTV Steel and its Affiliates
shall be otherwise released from all obligations
thereunder, and all other amounts owing pursuant to
the Existing TBT Letter of Credit Agreement shall
have been repaid in full, and the Agents shall have
received evidence in form, scope and substance
satisfactory to them that the matters set forth in
this SECTION 5.1(f)(i) have been satisfied at such
time.
(ii) On the Effective Date and concurrently
with the issuance of any Letters of Credit, the
creditors under the Existing TBT Letter of Credit
Agreement shall have released or assigned to LTV
Steel Products and the Collateral Agent all security
interests in and Liens on the Inventory of LTV Steel
and Georgia Tubing, and shall have released all
security interests in and Liens on all other assets
of LTV Steel, its Affiliates and their Subsidiaries,
which releases or assignments shall be in form and
substance satisfactory to the Collateral Agent.
(g) APPROVALS. On the Effective Date, all necessary
governmental and third party approvals in connection with the
transactions contemplated by the Transaction Documents shall have been
obtained and remain in effect and evidence thereof shall have been
provided to the Agents, and all applicable waiting periods shall have
expired without any action being taken by any competent authority which
restrains, prevents or imposes, in the judgment of the Required Lenders
or the Agents, materially adverse conditions upon the consummation of
such transactions.
(h) PAYMENT OF FEES. On the Effective Date, all costs, fees
and Expenses, and all other compensation contemplated by this
Agreement, due to the Placement Agent, the Administrative Agent and the
Financing Parties (including, without limitation, legal fees and
expenses) shall have been paid to the extent due.
(i) SECURITY INTERESTS. On the Effective Date, the Placement
Agent and the Administrative Agent shall have received from the
Servicer (i) UCC-11 reports and other lien searches with respect to the
Collateral and the pledged Class A-1 Notes reflecting the absence of
Liens thereon, except, with respect to the Collateral, Liens in favor
of the
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Purchaser or the Collateral Agent created in connection with the sale
by the Sellers of an interest in the Purchased Inventory, Liens on
Ineligible Inventory that would be reasonably expected not to have a
Material Adverse Collateral Effect, Permitted Liens, Receivables
Facility Liens and Liens as to which the Servicer has received UCC
termination or assignment statements to be filed on or prior to the
Effective Date, and (ii) evidence reasonably acceptable to the Agents
that UCC-1 financing statements have been or will be filed in each
jurisdiction reasonably requested by the Agents to perfect the security
interest granted to the Collateral Agent in the Collateral and with
respect to the pledged Class A-1 Notes.
(j) On the Effective Date, the Placement Agent and the
Administrative Agent shall have received a copy of a rating letter from
Fitch indicating that the Class A-1 Notes are rated by Fitch at a
rating not lower than "BBB".
Section 5.2. CONDITIONS TO EACH LETTER OF CREDIT. On each Letter of
Credit Issuance Date, both immediately before and after giving effect thereto
and to the application of the proceeds therefrom and from any concurrent sale of
Class A-1 Notes, the following statements shall be true to the satisfaction of
the Agent (and each delivery of a Letter of Credit Request, and the acceptance
by LTV Steel of the benefits of the requested Letter of Credit, shall constitute
a representation and warranty by LTV Steel that on such date immediately before
and after giving effect thereto and to the application of the proceeds therefrom
and from any concurrent sale of Class A-1 Notes, such statements are true):
(a) The representations and warranties of LTV Steel and its
Affiliates contained in this Agreement and in each other Transaction
Document are true and correct in all material respects on and as of
such date as though made on and as of such date, except to the extent
that such representations and warranties expressly relate solely to an
earlier date (in which case such representations and warranties shall
have been true and correct on and as of such earlier date);
(b) No event has occurred and is continuing, or would result
from the proposed use of these facilities or the application of the
proceeds thereof, which would constitute a Note Purchase Agreement
Default or a Note Purchase Agreement Event of Default;
(c) No change or development shall have occurred since the
Effective Date which in any such case, has had or is reasonably
expected to have a Material Adverse Collateral Effect, and shall be
continuing;
(d) As indicated on the most recent Sales and Valuation
Report, the Company shall be in compliance with the Note Collateral
Value Requirement;
(e) The issuance of such Letter of Credit would not violate
SECTION 3.1; and
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(f) The Administrative Agent and the respective Issuing Lender
shall have received a Letter of Credit Request meeting the requirements
of SECTION 3.4.
The acceptance of the benefits of the issuance of each Letter
of Credit shall constitute a representation and warranty by LTV Steel to each of
the Lenders that all of the applicable conditions specified above exist as of
the date of such issuance. All of the certificates, legal opinions and other
documents and papers referred to in this SECTION 5, unless otherwise specified
shall be delivered to the Administrative Agent at its Notice Address and in
sufficient counterparts or copies for each of the Lenders and shall be in form
and substance as specified herein or otherwise satisfactory to the
Administrative Agent.
ARTICLE VI.
REPRESENTATIONS AND WARRANTIES
To induce the Financing Parties to enter into this Agreement and to
provide the facilities provided for herein, LTV Steel makes the following
representations and warranties to the Financing Parties, all of which shall
survive the execution and delivery of this Agreement and the purchase of Class
A-1 Notes and the issuance of the Letters of Credit (with the acceptance of the
benefits of such facilities being deemed to constitute a representation and
warranty that the matters specified in this Article VI are true and correct in
all material respects on and as of each Note Purchase Date or Letter of Credit
Issuance Date, unless stated to relate to a specific earlier date (in which case
such representations and warranties shall have been true and correct on and as
of such earlier date)):
Section 6.1. CORPORATE STATUS. LTV Steel (i) is a duly organized and
validly existing corporation in good standing under the laws of the jurisdiction
of its organization and has the corporate power and authority to own its
property and assets and to transact the business in which its is engaged and
(ii) has duly qualified and is authorized to do business and is in good standing
in all jurisdictions where it is required to be so qualified and where the
failure to be so qualified would be reasonably likely to have a Material Adverse
Collateral Effect.
Section 6.2. CORPORATE POWER AND AUTHORITY. LTV Steel has the corporate
power and authority to execute, deliver and carry out the terms and provisions
of the Transaction Documents and has taken all necessary corporate action to
authorize the execution, delivery and performance of the Transaction Documents
to which it is a party. LTV Steel has duly executed and delivered each
Transaction Document to which it is a party and each such Transaction Document
constitutes the legal, valid and binding obligation of LTV Steel enforceable in
accordance with its terms, except that such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium and similar laws
of general application relating to or affecting the rights and remedies of
creditors and by general principles of equity.
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Section 6.3. NO VIOLATION. Neither the execution, delivery and
performance by LTV Steel of the Transaction Documents to which it is a party nor
compliance with the terms and provisions thereof, nor the consummation of the
transactions contemplated therein (i) contravenes any applicable provision of
any law, statute, rule, regulation, order, writ, injunction or decree of any
court or governmental instrumentality, (ii) conflicts or is inconsistent with or
results in any breach of any of the terms, covenants, conditions or provisions
of, or constitutes a default under, or (other than as contemplated by the
Transaction Documents) results in the creation or imposition of (or the
obligation to create or impose) any Lien upon any of the property or assets of
LTV Steel or any of its Affiliates pursuant to the terms of, any material
indenture, mortgage, deed of trust, material agreement or other material
instrument to which LTV Steel or any of its Affiliates is a party or by which it
or any of its property or assets are bound or to which it may be subject or
(iii) violates any provision of any Organizational Documents of LTV Steel,
unless, in each case, such contravention, conflict, breach, default, imposition
or violation would not, either individually or in the aggregate, be reasonably
expected to have a Material Adverse Collateral Effect.
Section 6.4. LITIGATION. There are no actions, suits or proceedings
pending or to LTV Steel's knowledge threatened with respect to (i) any
Transaction Document or (ii) LTV Steel, except as disclosed as material
litigation in the Quarterly Report on Form 10-Q of LTV for the quarter ended
September 30, 1997, a copy of which has been previously delivered to the
Financing Parties, in which there is a reasonable possibility of an adverse
decision that, after giving effect to expected insurance proceeds and indemnity
payments, is reasonably likely to have a Material Adverse Collateral Effect.
Section 6.5. GOVERNMENTAL APPROVALS. Except for the filing of financing
statements (which if this representation is being made later than 10 days after
the Effective Date, have been filed) and continuation statements as required
under the Transaction Documents, no order, consent, approval, license,
authorization, or validation of, or filing, recording or registration with, or
exemption by, any foreign or domestic governmental or public body or authority,
or any subdivision thereof, is required to authorize or is required in
connection with (i) the execution, delivery and performance by LTV Steel of any
Transaction Document or (ii) the legality, validity, binding effect or
enforceability of any Transaction Document as against LTV Steel, except for any
order, consent, approval, license, authorization, or validation of, or filing,
recording, registration or exemption which, if not obtained, would not, either
individually or in the aggregate, be reasonably expected to have a Material
Adverse Collateral Effect .
Section 6.6. INVESTMENT COMPANY ACT. LTV Steel is not an "investment
company" or a company "controlled" by an "investment company," within the
meaning of the Investment Company Act of 1940, as amended.
Section 6.7. PUBLIC UTILITY HOLDING COMPANY ACT. LTV Steel is not a
"holding company," or a "subsidiary company" of a "holding company," or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company," within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
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Section 6.8. TRUE AND COMPLETE DISCLOSURE. (a) All factual information
(taken as a whole) set forth in the Confidential Information Memorandum dated
January, 1998 relating to the transactions contemplated by the Transaction
Documents furnished in writing by or on behalf of LTV Steel and its Affiliates
does not, and all other such factual information (taken as a whole) hereafter
furnished by or on behalf of LTV Steel and its Affiliates in writing to the
Placement Agent, the Administrative Agent or any Financing Party pursuant to or
in connection with the Transaction Documents will not, as of the date as of
which such information is dated or certified, contain any untrue statement of a
material fact or omit to state any material fact necessary to make such
information (taken as a whole) not misleading as of such time, in each case in
light of the circumstances under which such information was provided, it being
understood and agreed that for the purposes of this SECTION 6.8, the reference
to "factual information" shall not include projections and PRO FORMA financial
information.
(b) As of the Effective Date, there is no fact known to LTV
Steel which has not been disclosed herein or in such other documents,
certificates and statements furnished to the Placement Agent,
Administrative Agent or the Financing Parties for use in connection
with the transactions contemplated hereby which is reasonably likely to
have a Material Adverse Collateral Effect.
Section 6.9 FINANCIAL CONDITION; FINANCIAL STATEMENTS. (a) On and as of
the Effective Date on a pro forma basis after giving effect to the transactions
contemplated by the Transaction Documents and all Indebtedness incurred, and to
be incurred, and Liens created and to be created, by LTV Steel and the other
Members in connection therewith (assuming the full utilization of the Aggregate
Commitment Amount under this Agreement), (x) the sum of the assets, at a fair
valuation of LTV Steel and the other Members taken as a whole will exceed their
debts, (y) LTV Steel and the other Members taken as a whole will not have
incurred nor intended to, or believe that they will, incur debts beyond their
ability to pay such debts as such debts mature and (z) LTV Steel and the other
Members taken as a whole do not have unreasonably small capital with which to
conduct their respective businesses. For purposes of this SECTION 6.9(a), "debt"
means any reasonably expected liability on a claim, and "claim" means (i) right
to payment whether or not such a right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
legal, equitable, secured or unsecured; or (ii) right to an equitable remedy for
breach of performance if such breach gives rise to a payment, whether or not
such right to an equitable remedy is reduced to judgment, fixed, contingent,
matured, unmatured, disputed, undisputed, secured or unsecured.
(b) LTV Steel has furnished to the Financing Parties the
following financial statements, which have been prepared in accordance
with GAAP (except, in the case of the unaudited financial statements
referred to below, for the omission of footnotes and ordinary year end
adjustments) consistently applied through the periods involved: (i)
LTV's audited consolidated balance sheet as of, and consolidated
statements of operations, shareholders' equity and cash flows for the
fiscal year ended, December 31, 1996 and (ii) LTV's unaudited
consolidated balance sheet as of, and consolidated statements of
operations, shareholders' equity and cash flows for the period ending,
September 30, 1997. Since the date of the
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financial statements referred to in clause (ii) above, nothing has
occurred which would be reasonably likely to result in a Material
Adverse Collateral Effect.
Section 6.10. BUSINESS NAMES. During the five years preceding the date
hereof (i) LTV Steel has not been known by any legal name or trade name other
than its corporate name and such other names as listed on Schedule 2 to the
Contribution and Sale Agreement, (ii) nor has LTV Steel been the subject of any
merger or other corporate reorganization within the last five years, EXCEPT that
effective December 31, 1997, LTV Steel Tubular Products Company was merged into
LTV Steel.
Section 6.11. TAX RETURNS AND PAYMENTS. Except as permitted by SECTION
7.5 and taxes settled pursuant to the IRS Settlement Agreement, all material tax
returns and reports of LTV Steel and its Affiliates required to be filed by any
of them have been timely filed, and all material taxes, assessments, fees and
other governmental charges upon LTV Steel and its Affiliates and upon their
respective properties, assets, income, businesses and franchises which are due
and payable have been paid when due and payable. LTV Steel is not aware of any
proposed tax assessment against LTV Steel or any of its Affiliates which is not
being actively contested by LTV Steel or such Affiliate in good faith and by
appropriate proceedings; PROVIDED that such reserves or other appropriate
provisions, if any, as shall be required in conformity with GAAP shall have been
made or provided therefor.
Section 6.12. COMPLIANCE WITH ERISA. LTV Steel is in material
compliance with all applicable provisions and requirements of ERISA.
Section 6.13 COMPLIANCE WITH STATUTES, ETC. LTV Steel is in compliance
with all applicable statutes, regulations and orders of, and all applicable
restrictions imposed by, all governmental bodies, domestic or foreign, in
respect of the conduct of its business and the ownership of its property, except
such noncompliance as are not reasonably likely to, in the aggregate, have a
Material Adverse Collateral Effect.
Section 6.14. PERFORMANCE OF AGREEMENTS. (a) LTV Steel is not in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any of its Contractual Obligations, and no
condition exists that, with the giving of notice or the lapse of time or both,
would constitute such a default, except where the consequences, direct or
indirect, of such default or defaults, if any, would not be reasonably expected
to have a Material Adverse Collateral Effect.
(b) LTV Steel is not a party to or otherwise subject to any
agreement or instrument or any charter or other internal restriction
which has had, or could reasonably be expected to result in,
individually or in the aggregate, a Material Adverse Collateral Effect.
Section 6.15 MARGIN REGULATIONS. Neither LTV Steel nor any of the other
Members is engaged principally, or as one of its important activities, in the
business of extending credit for the
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purpose of purchasing or carrying any Margin Stock. Neither the issuance of any
Letter of Credit or the use thereof will violate or be inconsistent with the
provisions of Regulation G, T, U or X of the Board of Governors of the Federal
Reserve System.
Section 6.16 CLASS A-1 NOTES. With respect to each Class A-1 Note and
Note Portion sold to Note Purchasers or pledged to the Collateral Agent for the
benefit of the Issuing Lenders and Lenders under the terms of this Agreement,
each such Class A-1 Note is free of any adverse claim by any Person and with
respect to such Class A-1 Notes and Note Portions so pledged to the Collateral
Agent, LTV Steel has granted to the Collateral Agent for the benefit of the
Issuing Lenders and Lenders a first priority perfected lien on such pledged
Notes.
ARTICLE VII.
AFFIRMATIVE COVENANTS
LTV Steel hereby covenants and agrees that on the Effective
Date and thereafter, for so long as this Agreement is in effect and until the
Aggregate Commitment Amount has terminated, no Letters of Credit are outstanding
and all reimbursement obligations, together with interest, Fees, Expenses and
all other Obligations incurred hereunder, are paid in full:
Section 7.1. FINANCIAL INFORMATION. LTV Steel shall furnish to the
Financing Parties the following information within the following time periods:
(i) FINANCIALS: as soon as available and in any event
within ten Business Days of filing with the SEC, a copy of
each report on Form 10K, Form 10Q or Form 8K filed with the
SEC by LTV Steel, LTV or any of the other Members and within
ninety days of the end of each calendar year, annual audited
financial statements of LTV Steel Products and within
forty-five days after each March 31, June 30 and September 30
of each calendar year, quarterly unaudited financial
statements of LTV Steel Products for the calendar quarter then
ended;
(ii) OFFICER'S AND COMPLIANCE CERTIFICATES: together
with each delivery of financial statements of LTV Steel
pursuant to clause (i) above, (a) an officer's certificate of
LTV Steel stating that the signer has reviewed the terms of
this Agreement and has made, or caused to be made under his
supervision, a review in reasonable detail of the transactions
conducted under the Transaction Documents and condition of LTV
Steel during the accounting period covered by such financial
statements and that such review has not disclosed the
existence during or at the end of such accounting period, and
that the signer does not have knowledge of the existence as at
the date of such officer's certificate, of any condition or
event that constitutes a Note Purchase Agreement Default or
Note Purchase Agreement Event of Default, or, if any such
condition or event existed or exists, specifying the nature
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and period of existence thereof and what action LTV Steel or
any of its Affiliates has taken, is taking and proposes to
take with respect thereto;
(iii) SEC FILINGS AND PRESS RELEASES: to the extent
not previously delivered pursuant to clause (i) above,
promptly upon their becoming available, copies of (a) all
financial statements, reports, notices and proxy statements
sent or made available generally by LTV Steel to its security
holders or by LTV or any other Member to its security holders
other than LTV Steel or other Affiliates of LTV Steel, (b) all
regular and periodic reports and all registration statements
(other than on Form S-8 or a similar form) and prospectuses,
if any, filed by LTV, LTV Steel or any other Member with any
securities exchange or with the SEC and (c) all press releases
and other statements made available generally by LTV, LTV
Steel or any other Member to the public concerning material
developments in the business of LTV, LTV Steel or such other
Member;
(iv) EVENTS OF DEFAULT, ETC.: promptly upon any
officer of LTV Steel obtaining knowledge (a) of any condition
or event that constitutes the occurrence of an Amortization
Date, or becoming aware that an Agent or any Note Purchaser or
Lender has given any notice or taken any other action with
respect to a claimed Amortization Date, or (b) that any Person
has given any notice to LTV Steel or any of its Affiliates or
taken any other action with respect to a claimed Amortization
Date, an officer's certificate specifying the nature and
period of existence of such condition, event or change, or
specifying the notice given or action taken by any such Person
and the nature of such claimed occurrence of an Amortization
Date and what action (if any) LTV Steel has taken, is taking
and proposes to take with respect thereto;
(v) LITIGATION: promptly upon any officer of LTV
Steel obtaining knowledge of (X) the institution of, or
non-frivolous threat of, any action, suit, proceeding,
governmental investigation or arbitration against or affecting
LTV Steel or any of its Affiliates or any property of LTV
Steel or any of its Affiliates (collectively, "Proceedings")
not previously disclosed in writing by LTV Steel to each Agent
and the Financing Parties or (Y) any material development in
any Proceeding:
(1) in which there is a material possibility
of an adverse decision and which, if adversely
determined, could reasonably be expected to cause a
Material Adverse Collateral Effect; or
(2) that seeks to enjoin or otherwise
prevent the consummation of, or to recover any
damages or obtain relief directly as a result of, the
transactions contemplated hereby and by the other
Transaction Documents;
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written notice thereof with such other information as may be reasonably made
available by LTV Steel or any of its Affiliates to enable the Agents and the
Financing Parties and their counsel to evaluate such matters.
Section 7.2. CORPORATE FRANCHISES. LTV Steel will do all things
necessary to preserve and keep in full force and effect its existence, material
rights and authority to do business, provided that any transaction not
prohibited by SECTION 8.1 will not constitute a breach of this SECTION 7.2, and
provided further, that LTV Steel shall not be required to preserve any material
right or authority to do business if LTV Steel shall reasonably determine that
such preservation is no longer desirable in the ordinary course of business, and
the loss thereof shall not be reasonably likely to have a Material Adverse
Collateral Effect.
Section 7.3 COMPLIANCE WITH STATUTES, ETC. LTV Steel will comply with
all applicable statutes, regulations and orders of, and all applicable
restrictions imposed by, all governmental bodies, domestic or foreign, in
respect of the conduct of its business and the ownership of its property other
than those the non-compliance with which (individually or in the aggregate)
would not be reasonably expected to have a Material Adverse Collateral Effect.
Section 7.4 MAINTENANCE OF PROPERTIES; LTV Steel will maintain or cause
to be maintained in good repair, working order and condition, as it shall, in
its reasonable judgment, deem prudent, all material properties used or useful in
the business of LTV Steel and from time to time will make or cause to be made
all appropriate repairs, renewals and replacements thereof as it shall, in its
reasonable judgment, deem prudent, except to the extent that such failure would
not be reasonably expected to have a Material Adverse Collateral Effect; and
provided further, that the foregoing shall not prevent LTV Steel from
abandoning, demolishing and/or removing any buildings, structures, other
improvements or fixtures that are unserviceable or no longer required in the
conduct of its business.
Section 7.5 TAXES. LTV Steel will, and will cause each of its
Affiliates to, pay all taxes, assessments and other governmental charges imposed
upon it or any of its properties or assets or in respect of any of its income,
businesses or franchises before any penalty accrues thereon, and all claims
(including, without limitation, claims for labor, services, materials and
supplies) for sums that have become due and payable and that by law have or may
become a lien upon any of the Collateral or the Notes prior to the time when any
penalty or fine shall be incurred with respect thereto; provided that no such
charge or claim need be paid if being contested in good faith by appropriate
proceedings promptly instituted and diligently conducted and if such reserve or
other appropriate provision, if any, as shall be required in conformity with
GAAP shall have been made therefor or if the failure to pay such charges or
claims, either individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Collateral Effect; provided further
that no such property tax need be paid if such property tax is nonrecourse to
LTV Steel and its Affiliates or is recourse to LTV Steel and its Affiliates only
for a de minimis amount.
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Section 7.6 NOTICES IN CASE OF DEFAULT. To the extent that any notice
from LTV Steel or any of its Affiliates is required in connection with any Trust
Agreement Event of Default, Purchase Termination Event or Servicer Termination
Event, LTV Steel agrees to provide such notice within one Business Day after
receiving any written direction or request from the Required Financing Parties
that such notice be provided.
Section 7.7 LOSS OF PERFECTION EVENT. In the event there shall occur
and be in existence a Loss of Perfection Event, LTV Steel shall use its best
efforts to cure such event so that the Loss of Perfection Event shall no longer
be in existence. If LTV Steel shall have not so cured such Loss of Perfection
Event within five (5) Business Days after an Authorized Officer of LTV Steel
becoming aware of such occurrence, LTV Steel agrees (a) to contribute additional
Collateral to LTV Steel Products and/or (b) cause LTV Steel Products to redeem
Class A-1 Notes with the result that the Note Collateral Value Requirement is
then satisfied. On the fifth Business Day after the occurrence of a Loss
Perfection Event, and on each fifth Business Day thereafter until there shall no
longer be in existence such Loss of Perfection Event, LTV Steel shall provide to
the Collateral Agent and the Agents a Sales and Valuation Report as of such
date.
Section 7.8. RECEIVABLES INTERCREDITOR AGREEMENT. LTV Steel shall use
its best efforts to cause a Receivables Intercreditor Agreement to be executed
and in effect within ninety (90) days of the Effective Date.
ARTICLE VIII.
NEGATIVE COVENANTS
LTV Steel hereby covenants and agrees that as of the Effective
Date, and thereafter, for so long as this Agreement is in effect and until the
Aggregate Commitment Amount has terminated, no Letter of Credit is outstanding
and all reimbursement obligations, together with interest, Fees, Expenses and
all other Obligations incurred hereunder, are paid in full:
Section 8.1. CONSOLIDATION, MERGER, SALE OF ASSETS, ETC.. LTV Steel
will not wind up, liquidate or dissolve its affairs.
Section 8.2. EXERCISE OF REMEDIES. LTV Steel will not, nor will it
permit any of its Subsidiaries to, exercise any of the remedies under the
Transaction Documents to which such Persons are party without the prior written
consent of the Required Financing Parties.
ARTICLE IX.
EVENTS OF DEFAULT AND REMEDIES
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Section 9.1. EVENTS OF DEFAULT. Upon the occurrence of any of the
following specified events (each a "Note Purchase Agreement Event of Default"):
(a) PAYMENTS. LTV Steel shall (i) default, and such default
shall continue for two or more Business Days, in the payment when due
of any drawings (and related interest) under Letters of Credit or (ii)
default, and such default shall continue for five or more days
following written notice thereof to LTV Steel by any Agent, in the
payment when due of any Fees, Expenses or any other amounts owing by
LTV Steel hereunder;
(b) REPRESENTATIONS, ETC. Any representation, warranty or
statement made by LTV Steel in this Agreement or in any other
Transaction Document or in any statement or certificate delivered or
required to be delivered pursuant hereto or thereto shall prove to be
untrue in any material respect on the date as of which made or deemed
made; provided that if such untruth can be cured and LTV Steel is
diligently pursuing such cure and there shall not then be in existence
a Cure Period Cut-off Event, then such event shall not constitute a
Note Purchase Agreement Event of Default for a period of thirty (30)
days after an Authorized Officer of LTV Steel is aware of such untruth;
or
(c) COVENANTS. LTV Steel shall (i) default in the due
performance or observance by it of any term, covenant or agreement
contained in SECTION 3.9 or (ii) default in the due performance or
observance by it of any term, covenant or agreement under this
Agreement and such default shall continue unremedied for a period of at
least 30 days after the earlier to occur of (i) an Authorized Officer
of LTV Steel becoming aware of such default or (ii) notice to LTV Steel
by the respective Agent or the Required Financing Parties; provided
that if such default can be cured and LTV Steel is diligently pursuing
such cure and there shall not then be in existence a Cure Period
Cut-off Event, then such event shall not constitute a Note Purchase
Agreement Event of Default for a period of an additional thirty (30)
days after such notice; or
(d) DEFAULT UNDER OTHER AGREEMENTS. There shall occur or exist
any of the following events or conditions:
(i) a Trust Agreement Event of Default;
(ii) a Purchase Termination Event under the
Contribution and Sale Agreement;
(iii) a Servicer Termination Event under the
Inventory Processing and Servicing Agreement;
(iv) a Receivables Default Event; or
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(v) the Collateral Agent shall cease to have
a first priority perfected security interest in the
Class A-1 Notes pledged for the benefit of the
Issuing Lenders or the Lenders or the Collateral
Agent shall cease to have the perfected interest in
the Collateral in the priority contemplated by the
Transaction Documents, in each case, for a period of
five Business Days following the earlier to occur of
(x) an Authorized Officer of LTV Steel becoming aware
of such loss of priority or perfection, and (y)
notice to LTV Steel by the respective Agent or the
Required Financing Parties; or
(e) INSOLVENCY. There shall occur an Insolvency Proceeding
with respect to LTV Steel; or
(f) CERTAIN LIENS. Either the IRS or the PBGC shall have filed
one or more Liens against the Collateral in an aggregate amount
exceeding $3,500,000 unless (i) such amounts are adequately bonded to
the satisfaction of the Required Financing Parties or (ii) such amounts
relate to taxes which are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves are being
maintained under GAAP;
(g) TRANSACTION DOCUMENTS. Any Transaction Document shall
cease to be in full force and effect, or shall cease to give the
Collateral Agent on behalf of the Secured Parties, rights, powers and
privileges purported to be created thereby with respect to the
Collateral;
then, and in any such event, and at any time thereafter, if any Note Purchase
Agreement Event of Default shall then be continuing, each Agent shall, upon the
written request of the Required Financing Parties, by written notice to LTV
Steel take any or all of the following actions, without prejudice to the rights
of the Agents or any Financing Party to enforce its claims against LTV Steel,
except as otherwise specifically provided for in this Agreement (provided that,
if a Note Purchase Agreement Event of Default specified in SECTION 9.1(e) shall
occur, the result which would occur upon the giving of written notice by the
Agents as specified in clauses (i) and (ii) below shall occur automatically
without the giving of any such notice): (i) declare the Aggregate Commitment
Amount terminated, whereupon the Commitment of each Financing Party shall
forthwith terminate immediately; (ii) declare the principal of and any accrued
interest in respect of all Obligations owing hereunder to be, whereupon the same
shall become, forthwith due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by LTV Steel; (iii)
terminate any Letter of Credit which may be terminated in accordance with its
terms; (iv) direct LTV Steel to pay (and LTV Steel hereby agrees upon receipt of
such notice, or upon the occurrence of any Note Purchase Agreement Event of
Default specified in SECTION 9.1(e), it will pay) to the Administrative Agent
such additional amounts, if any, as the Administrative Agent shall reasonably
request to be held by it as additional security for LTV Steel's reimbursement
obligations in respect of the Letters of Credit; and/or (v) take possession of,
collect on, sell or otherwise take such actions as directed by the Required
Financing Parties with respect to its Class A-1 Notes pledged to the Collateral
Agent for the benefit of the Issuing Lenders and the Lenders.
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ARTICLE X.
THE AGENTS
Section 10.1. APPOINTMENT OF THE AGENTS. Each Lender hereby irrevocably
appoints The Chase Manhattan Bank as its Administrative Agent hereunder and each
Note Purchaser hereby irrevocably appoints Chase Securities Inc. as the
Placement Agent and hereby authorizes the Agents to take such action on its
behalf to execute, deliver and perform such documents on its behalf, and to
exercise such rights, remedies, powers and privileges hereunder as are
specifically authorized to be exercised by the Agents by the terms hereof,
together with such rights, remedies, powers and privileges as are reasonably
incidental thereto. The Agents may execute any of their duties hereunder by or
through agents or employees, and the Agents shall not be responsible for the
negligence or misconduct of any such agents or employees selected by them with
reasonable care. The relationship between the Administrative Agent and each
Lender and the Placement Agent and each Note Purchaser is that of agent and
principal only, and nothing herein shall be deemed to constitute or appoint the
Administrative Agent a trustee or fiduciary for any Lender or the Placement
Agent a trustee or fiduciary for any Note Purchaser or impose on the Agents any
obligations other than those for which express provision is made herein. Upon
receipt, the Agents, as applicable, will forward (a) to each Financing Party an
executed copy of the Transaction Documents and a copy of each officer's
certificate specified in SECTION 5.1 hereof, (b) to each Lender, a copy of each
Letter of Credit Request, and (c) to each Note Purchaser, a copy of each Note
Repurchase Notice.
Except as required by the specific terms of this Agreement, the Agents
shall not have any duty to exercise any right, power, remedy or privilege
granted to them hereby, or to take any affirmative action or exercise any
discretion hereunder, unless directed to do so by the Required Financing Parties
or all the Financing Parties, as applicable (and shall be fully protected in
acting or refraining from acting pursuant to such directions which shall be
binding upon the Financing Parties), and shall not, without the prior approval
of the Required Financing Parties or all the Financing Parties, as applicable,
consent to any material departure by LTV Steel from the terms hereof, waive any
default on the part of LTV Steel hereunder or amend, modify, supplement or
terminate, or agree to any surrender of, this Agreement; provided, that the
foregoing limitation on the authority of the Agents is for the benefit of the
Financing Parties and shall not impose any obligation on LTV Steel to
investigate or inquire into the authority of the Agents in any circumstances,
and LTV Steel shall be fully protected in carrying out any request, direction or
instruction made or given to LTV Steel by the Agents in the exercise of any
right, power, remedy or privilege granted to the Agents hereby or by the terms
of any other Transaction Document, receiving or acting upon any consent or
waiver granted to LTV Steel hereunder by the Agents, or entering into any
amendment or modification of, or supplement to, this Agreement or any other
Transaction Document, and LTV Steel shall not be subject to the claims of any
Financing Parties by reason of the lack of authority of the Agents to take any
such action nor shall the lack of authority on the part of the Agents in any
circumstance give rise to any claim on the part of LTV Steel against any
Financing Party; and provided, further, that the Agents shall not be required to
take any action
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which exposes the Agents to personal liability or which is contrary to this
Agreement, or applicable law.
Neither the Administrative Agent nor the Placement Agent, or any of
their respective directors, officers, agents or employees, shall be liable to
any person or entity, including without limitation, the Administrative Agent,
the Placement Agent or any Financing Party, as the case may be, for any action
taken or omitted to be taken by it or them hereunder, under any other
Transaction Document, or in connection herewith or therewith, except for any
liability determined, in a final judgment of a court of competent jurisdiction,
to have resulted from the Administrative Agent's or Placement Agent's own gross
negligence or willful misconduct; nor shall the Administrative Agent or the
Placement Agent be responsible to the Administrative Agent, the Placement Agent
or any Financing Party, as the case may be, for the validity, effectiveness,
value, sufficiency or enforceability against LTV Steel of any Transaction
Document or other document furnished pursuant hereto or thereto or in connection
herewith or therewith. The Agents shall not be liable under this Agreement to
LTV Steel or its directors, officers, agents, employees or members for indirect,
special, punitive, incidental or consequential loss or damage of any kind
whatsoever, including, without limitation, lost profits. Without limitation of
the generality of the foregoing, each of the Administrative Agent and the
Placement Agent: (i) may consult with legal counsel (including counsel for LTV
Steel), 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 or reliance upon the advice of such counsel, accountants
or experts; (ii) makes no warranty or representation to any Financing Party, and
shall not be responsible to any Financing Party for any statements, warranties
or representations made in or in connection with this Agreement, any other
Transaction Document or any other document furnished pursuant hereto or thereto
or in connection herewith or therewith; (iii) 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, any other Transaction Document or any
other document furnished pursuant hereto or thereto or in connection herewith or
therewith, on the part of any party hereto or thereto or to inspect the property
(including the Books and Records) of LTV Steel; (iv) shall not be responsible to
the Administrative Agent, the Placement Agent or any Financing Party for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of this Agreement, any other Transaction Document or any other instrument or
document furnished pursuant hereto or thereto and (v) shall incur no liability
under or in respect of this Agreement, any other Transaction Document or any
other document furnished pursuant hereto or thereto or in connection herewith or
therewith, by acting upon or relying upon any notice, consent, certificate or
other instrument or writing or telephonic instruction, or notices to the extent
authorized herein or therein believed by it to be genuine and sent by the proper
party or parties.
Each Financing Party hereby represents that it has, independently and
without reliance on the Administrative Agent, any other Financing Party or the
Placement Agent and based on such documents and information as it has deemed
appropriate, made its own appraisal of the financial risks and other risks
involved in the transactions contemplated hereunder and under the Transaction
Documents and of the financial condition and affairs of LTV Steel, the other
Members and LTV Steel Products and the adequacy of the security granted to the
Collateral Agent under the Trust
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Agreement and its own decision to enter into this Agreement and the transactions
contemplated hereby and agrees that it will, independently and without reliance
upon the Administrative Agent, any other Financing Party or the Placement Agent,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own appraisals and decisions in taking or not taking
action under this Agreement. The Agents shall not be required to keep themselves
informed as to the performance or observance by LTV Steel, the other Members and
LTV Steel Products of this Agreement, the other Transaction Documents or any
other document referred to or provided for herein or therein or to make inquiry
of, or to inspect the properties or books of LTV Steel, the other Members and
LTV Steel Products. Except for notices, reports and other documents and
information expressly required to be furnished to the Financing Parties by the
Agent or by the Placement Agent hereunder, the Administrative Agents shall not
have any duty or responsibility to provide any Financing Party with any credit
or other information concerning LTV Steel, the other Members and LTV Steel
Products which may come into the possession of the Agents.
Neither the Administrative Agent nor the Placement Agent shall be
deemed to have knowledge or notice of the occurrence of a Note Purchase
Agreement Default or Note Purchase Agreement Event of Default unless the
Administrative Agent or the Placement Agent, as applicable, has received written
notice from a Lender, a Note Purchaser, the Servicer or LTV Steel referring to
this Agreement, describing such Note Purchase Agreement Default or Note Purchase
Agreement Event of Default and stating that such notice is a "Notice of Note
Purchase Agreement Default" or "Notice of Note Purchase Agreement Event of
Default," as the case may be. In the event that either the Administrative Agent
or the Placement Agent receives such a notice of the occurrence of a Note
Purchase Agreement Default or Note Purchase Agreement Event of Default, the
Administrative Agent or the Placement Agent, as applicable, shall promptly give
notice thereof to the Financing Parties. The Agents shall take such action with
respect to such Note Purchase Agreement Default or Note Purchase Agreement Event
of Default as shall be reasonably directed by the Required Financing Parties;
provided that, if neither the Administrative Agent nor the Placement Agent have
received such directions from the Required Financing Parties after using
reasonable efforts to receive such directions, the Administrative Agent or
Placement Agent may (but shall not be obligated to) take such action or refrain
from taking such action, with respect to such Note Purchase Agreement Default or
Note Purchase Agreement Event of Default as it shall deem advisable in the best
interests of the Financing Parties.
Each Financing Party hereby agrees, in the ratio that such Financing
Party's Commitment hereunder bears to the Aggregate Commitment Amount to
indemnify and hold harmless the Administrative Agent and the Placement Agent,
respectively, and its directors, officers, agents and employees, from and
against any and all losses, liabilities (including liabilities for penalties),
actions, suits, judgments, demands, damages, settlements, costs and expenses of
any kind whatsoever (including, without limitation, reasonable fees and expenses
of attorneys, accountants and experts) incurred or suffered by the
Administrative Agent or the Placement Agent, as applicable, in its capacity as
Administrative Agent or Placement Agent hereunder as a result of any action
taken or omitted to be taken by the Administrative Agent or Placement Agent in
such capacity or otherwise incurred or suffered by, made upon, or assessed
against the Administrative Agent or Placement
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Agent in such capacity; provided, that no Financing Party shall be liable for
any portion of any such losses, liabilities (including liabilities for
penalties), actions, suits, judgments, demands, damages, settlements, costs or
expenses determined, in the final judgment of a court of competent jurisdiction,
to be attributable primarily to gross negligence or willful misconduct on the
part of the Administrative Agent or Placement Agent. Without limiting the
generality of the foregoing, each Financing Party hereby agrees, in the ratio
aforesaid, to reimburse the Administrative Agent and Placement Agent,
respectively, promptly following its demand for any out-of-pocket expenses
(including, without limitation, attorneys' fees and expenses) incurred by the
Administrative Agent, the Placement Agent or their directors, officers, agents
and employees hereunder or under the other Transaction Documents, and not
promptly reimbursed to the Administrative Agent or the Placement Agent by LTV
Steel. Each Financing Party's obligations under this paragraph shall survive the
termination of this Agreement and the discharge of LTV Steel's obligations
hereunder.
The Financing Parties agree that with respect to their obligation to
lend under this Agreement, the Letters of Credit issued by them and the Notes
held by them, The Chase Manhattan Bank and Chase Securities Inc., as applicable,
shall have the same rights and powers hereunder as any other Financing Party and
may exercise the same as though it were not performing the duties specified
herein; and the terms "Lender", "Required Financing Parties," "Note Purchaser,"
or any similar terms shall, unless the context clearly otherwise indicates,
include The Chase Manhattan Bank or Chase Securities Inc., as applicable, in its
individual capacity. The Chase Manhattan Bank and Chase Securities Inc. may
accept deposits from, lend money to, and generally engage in any kind of
banking, trust or other business with LTV Steel or any of its Affiliates as if
it were not performing the duties specified herein, and may accept fees and
other consideration from LTV Steel or any of its Affiliates for services in
connection with any Transaction Document and otherwise without having to account
for the same to any Financing Party.
The Agents shall be entitled to rely on any communication, instrument,
paper or other document believed by it to be genuine and correct and to have
been signed or sent by the proper Person or Persons. With respect to its share
of liability under this Agreement, The Chase Manhattan Bank and Chase Securities
Inc. or any successor agent, if a Lender or Note Purchaser, shall have the same
rights, power, remedies and privileges as any other Lender or Note Purchaser and
may exercise the same as though it were not the administrative agent of the
Financing Parties hereunder.
Section 10.2. RESIGNATION OF THE AGENTS. The Administrative Agent and
the Placement Agent may resign as such at any time upon at least forty-five (45)
days' prior written notice to LTV Steel, the Collateral Agent and the Financing
Parties; provided, however, that the resignation of the Administrative Agent
shall not be effective until the Required Financing Parties shall have agreed to
the appointment of another Lender to perform the duties of the Agent hereunder,
and such replacement shall have accepted such appointment, and the resignation
of the Placement Agent shall not be effective until the Required Financing
Parties shall have agreed to the appointment of another Note Purchaser to
perform the duties of the Placement Agent hereunder. In the event of such
resignation, the Required Financing Parties shall as promptly as practicable
appoint a successor agent to replace the Administrative Agent or Placement Agent
with the approval of LTV Steel. If
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the Required Financing Parties have not appointed a successor agent within
forty-five (45) days of the Administrative Agent's resignation notice, the
resigning Administrative Agent shall appoint a successor with the approval of
LTV Steel. Similarly, if the Required Financing Parties have not appointed a
successor agent within forty-five (45) days of the Placement Agent's resignation
notice, the resigning Placement Agent shall appoint a successor with the
approval of LTV Steel. Notwithstanding the resignation of the Administrative
Agent or Placement Agent hereunder, the provisions of SECTION 10.1 hereof shall
continue to inure to the benefit of the Agent or Placement Agent in respect of
any action taken or omitted to be taken by the Administrative Agent or Placement
Agent in its capacity as such while it was such under this Agreement. The
Administrative Agent and the Placement Agent hereunder shall at all times be a
financial institution organized and doing business under the laws of the United
States of America or any state, authorized under such laws to exercise corporate
trust powers, whose long term unsecured debt is rated at least "A" by each
Rating Agency and shall have a combined capital and surplus of at least
$50,000,000 or shall be a member of a bank holding system the aggregate combined
capital and surplus of which is $50,000,000 and subject to supervision or
examination by federal or state authority. If such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of a
supervising or examining authority, then for the purposes of this SECTION 10.2,
the combined capital and surplus of such Person shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. In case at any time the Administrative Agent or the Placement
Agent shall cease to be eligible in accordance with the provisions of this
Section, the Administrative Agent or the Placement Agent, as the case may be,
shall resign in the manner and with the effect specified herein.
Section 10.3. OBLIGATIONS SEVERAL. The obligations of the Lenders
hereunder are several, and neither the Administrative Agent nor any Lender shall
be responsible for the obligation of any other Lender hereunder, nor will the
failure of any Lender to perform any of its obligations hereunder relieve the
Administrative Agent or any other Lender from the performance of its obligations
hereunder. Nothing contained in this Agreement, and no actions taken by the
Lenders or the Administrative Agent pursuant hereto or in connection with the
Aggregate Commitment Amount shall be deemed to constitute the Lenders, together
or with the Administrative Agent, a partnership, association, joint venture or
other entity.
Similarly, the obligations of the Note Purchasers hereunder are
several, and neither the Placement Agent nor any Note Purchaser shall be
responsible for the obligation of any other Note Purchaser hereunder, nor will
the failure of any Note Purchaser to perform any of its obligations hereunder
relieve the Placement Agent or any other Note Purchaser from the performance of
its obligations hereunder. Nothing contained in this Agreement, and no actions
taken by the Note Purchasers or the Placement Agent pursuant hereto or in
connection with the Aggregate Commitment Amount shall be deemed to constitute
the Note Purchasers, together or with the Placement Agent, a partnership,
association, joint venture or other entity.
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ARTICLE XI.
MISCELLANEOUS
Section 11.1. SUBMISSION TO JURISDICTION; WAIVER. LTV Steel hereby
irrevocably and unconditionally:
(a) Submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Transaction
Documents, or for recognition and enforcement of any judgment in
respect thereof, to the non-exclusive general jurisdiction of the
courts of the State of New York located in New York City, the Courts of
the United States of America for the Southern District of New York and
appellate courts from any thereof;
(b) Consents that any such action or proceeding may be brought
in such courts and waives, to the extent permitted by applicable law,
any objection that it may now or hereafter have to the venue of any
such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead
or claim the same;
(c) Designates, appoints and empowers CT Corporation System
with offices on the date hereof at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇ as its designee, appointee and agent to receive, accept and
acknowledge for and on its behalf, and in respect of its property,
service of any and all legal process, summons, notices and documents
which may be served in any such action or proceeding. If for any reason
such designee, appointee and agent shall cease to be available to act
as such, LTV Steel agrees to designate a new designee, appointee and
agent in New York City on the terms and for the purposes of this
provision satisfactory to the Agents under this Agreement.
(d) Agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage
prepaid, to LTV Steel at its Notice Address;
(e) Agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall
limit the right to ▇▇▇ in any other jurisdiction;
(f) To the extent permitted by law, waives the right to assert
any setoff, counterclaim or cross-claim in respect of, and all statutes
of limitations which may be relevant to, such action or proceeding
(other than compulsory counterclaims), provided that nothing in this
clause (f) shall preclude a separate action asserting any such claims;
and
(g) Waives due diligence, demand, presentment and protest and
any notices thereof as well as notice of nonpayment.
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Section 11.2. JURY TRIAL. LTV Steel, the Placement Agent and the
Financing Parties each hereby waives any right to a trial by jury in any action
or proceeding arising out of this Agreement or the Transaction Documents or any
other agreements or transactions related hereto or thereto.
Section 11.3 GOVERNING LAW. The validity, interpretation and
enforcement of this Agreement shall be governed by the laws of the State of New
York without regard to conflicts of laws principles.
Section 11.4. DELAYS; PARTIAL EXERCISE OF REMEDIES. No delay or
omission of the Placement Agent, the Administrative Agent or any Financing Party
to exercise any right or remedy hereunder, whether before or after the happening
of any Note Purchase Agreement Event of Default, shall impair any such right or
shall operate as a waiver thereof or as a waiver of any such Note Purchase
Agreement Event of Default. No single or partial exercise by the Placement
Agent, the Administrative Agent or any Financing Party of any right or remedy
shall preclude any other or further exercise thereof, or preclude any other
right or remedy.
Section 11.5. NOTICES. Except as otherwise provided herein, all notices
and correspondences hereunder shall be in writing and sent by certified or
registered mail, return receipt requested, or by overnight delivery service,
with all charges prepaid to each party at its respective Notice Address.
Section 11.6. BENEFIT OF AGREEMENT. (a) This Agreement shall be binding
upon and inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereof, provided that LTV Steel may not assign or
transfer any of its interests hereunder, without the prior written consent of
the Required Financing Parties and provided further that the rights of each
Financing Party to transfer, assign or grant participations in its rights and/or
obligations hereunder shall be limited as set forth below in this SECTION 11.6,
provided that nothing in this SECTION 11.6 shall prevent or prohibit any
Financing Party from pledging its rights under this Agreement hereunder to a
Federal Reserve Bank in support of borrowings made by such Financing Party from
such Federal Reserve Bank.
(b) Each Financing Party shall have the right to transfer,
assign or grant participations in all or any part of its remaining
rights and obligations hereunder on the basis set forth below in this
clause (b).
(1) ASSIGNMENTS. Each Financing Party may
assign pursuant to an Assignment and Assumption
Agreement substantially in the form of Exhibit E to
this Agreement all or an undivided ratable portion of
its rights and obligations hereunder (including its
Pro Rata Portion of any Notes as to which the Note
Purchasers are the Holders) pursuant to this clause
(b)(1) to (x) one or more Financing Parties or (y)
one or more other Eligible Transferees, provided that
(i) any such assignment pursuant to clause (y) above
shall be in the aggregate amount of at least
$5,000,000, unless any Financing Party shall assign
to an Eligible Transferee all of its Commitment,
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Pro Rata Portion of Letters of Credit, Pro Rata
Portion of the Class A-1 Notes and other obligations
under this Agreement. Any assignment to another
Financing Party pursuant to this clause (b)(1) will
become effective upon the payment to the
Administrative Agent by either the assigning or the
assignee of a nonrefundable assignment fee of $1250
and the recording by the Administrative Agent of such
assignment, and the resultant effects thereof on the
Commitments of the assigning Financing Party and the
assignee Financing Party, in the Lender Register and
the Note Register, the Administrative Agent and the
Collateral Agent hereby agreeing to effect such
recordation no later than five Business Days after
their receipt of a written notification by the
assigning Financing Party and the assignee Financing
Party of the proposed assignment, provided that the
Administrative Agent and Collateral Agent shall not
be required to, and shall not, so record any
assignment in the Lender Register or the Note
Register on or after the date on which any proposed
amendment, modification or supplement in respect of
this Agreement has been circulated to the Financing
Parties for approval until the earlier of (x) the
effectiveness of such amendment, modification or
supplement in accordance with SECTION 11.10 or (y) 30
days following the date on which such proposed
amendment, modification or supplement was circulated
to the Financing Parties. Assignments pursuant to
sub-clause (y) of the first sentence of this clause
(b)(1) will only be effective if the Administrative
Agent shall have received a written notice in the
form provided in Exhibit E to this Note Purchase
Agreement from the assigning Financing Party and the
assignee and payment of a non-refundable assignment
fee of $1250 to the Administrative Agent by either
the assigning Financing Party or the assignee. No
later than five Business Days after its receipt of
such written notice, the Administrative Agent and the
Collateral Agent will record such assignment, and the
resultant effects thereof on the Commitment of the
assigning Financing Party, in the respective
Registers, at which time such assignment shall become
effective, provided that the Administrative Agent and
the Collateral Agent shall not be required to, and
shall not, so record any assignment in the Note
Register or Lender Register on or after the date on
which any proposed amendment, modification or
supplement in respect of this Agreement has been
circulated to the Financing Parties for approval
until the earlier of (x) the effectiveness of such
amendment, modification or supplement in accordance
with SECTION 11.10 or (y) 30 days following the date
on which such proposed amendment, modification or
supplement was circulated to the Financing Parties.
Upon the effectiveness of any assignment pursuant to
sub-clause (y) of the first sentence of this clause
(b)(1), the assignee will become a "Lender", "Note
Purchaser" and "Financing Party" for all purposes of
this Agreement and the other Transaction Documents
with a Commitment as so recorded by the
Administrative Agent and the Collateral Agent in the
respective Register, and
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to the extent of such assignment, the assigning
Financing Party shall be relieved of its obligations
hereunder with respect to the portion of its
Commitment being assigned. The Administrative Agent
will (x) notify each Issuing Lender with respect to
outstanding Letters of Credit within 5 Business Days
of the effectiveness of any assignment hereunder and
(y) prepare as of the day on which an assignment has
become effective pursuant to this clause (b)(1) a new
Schedule I giving effect to all such assignments
effected on such day and will promptly provide the
same to LTV Steel and each of the Financing Parties.
(2) PARTICIPATION. Each Financing Party may
transfer, grant or assign participations in all or
any part of such Financing Party's interest and
obligations hereunder pursuant to this clause (b)(2)
to any Eligible Transferee, provided that (i) such
Financing Party shall remain a "Lender" and "Note
Purchaser" for all purposes of this Agreement and the
transferee of such participation shall not constitute
a Financing Party hereunder and (ii) no participant
under any such participation shall have rights to
approve any amendment to or waiver of this Agreement
or any other Transaction Document except to the
extent such amendment or waiver would (x) unless
otherwise agreed by the relevant Financing Party in
its capacity as Issuing Lender, extend the stated
expiration date of any Letter of Credit beyond the
Expiration Date applicable to the Commitment of such
Financing Party, or extend the Expiration Date
applicable to the Commitment of such Financing Party,
(y) reduce the interest rate (other than as a result
of waiving the applicability of any post-default
increases in interest rates) or Fees in which such
participant is sharing and applicable to the
Commitment or Letters of Credit or postpone the
payment or reduce the amount thereof or (z) release
all or substantially all of the Collateral (except as
expressly provided in the Transaction Documents). In
the case of any such participation, the participant
shall not have any rights under this Agreement or any
of the other Transaction Documents (the participant's
rights against the granting Financing Party in
respect of such participation to be those set forth
in the agreement with such Financing Party creating
such participation) and all amounts payable by LTV
Steel hereunder shall be determined as if such
Financing Party had not sold such participation,
provided that such participant shall be entitled to
receive additional amounts under SECTIONS 4.5 and 4.7
on the same basis as if it were a Financing Party;
provided, further, however, that no participant of
the rights of a Financing Party shall be entitled to
receive any greater payment under Sections 4.5 and
4.7 than such Financing Party would have been
entitled to receive with respect to the rights
subject to such participation, unless LTV Steel has
consented to such participation. In addition, each
agreement creating any participation must include an
agreement by the participant to be bound by the
provisions of
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SECTION 11.7 of this Agreement and such participant
shall have executed a confidentiality agreement in
the form of Exhibit F hereto.
(c) Notwithstanding any other provisions of this SECTION 11.6,
no transfer or assignment of the interests or obligations of any
Financing Party hereunder or any grant of participation therein shall
be permitted if such transfer, assignment or grant would require LTV
Steel to file a registration statement with the SEC or to qualify the
extensions of credit under the "Blue Sky" laws of any State.
(d) If any Financing Party defaults in its obligations as a
Note Purchaser under this Agreement or if any Financing Party becomes a
Defaulting Lender, or upon the occurrence of any event giving rise to
the option of SECTION 4.5 and 4.7 with respect to such Financing Party
or if any Financing Party declines to extend the Expiration Date under
SECTION 11.16, LTV Steel shall have the right, if no Note Purchase
Agreement Default or Note Purchase Agreement Event of Default then
exists, to then replace such Financing Party (the "Replaced Financing
Party") with one or more Eligible Transferees (collectively, the
"Replacement Financing Party"), provided that (i) at the time of any
replacement pursuant to this SECTION 11.6(d), the Replacement Financing
Party shall enter into one or more Assignment and Assumption Agreements
pursuant to SECTION 11.6 (and with all fees payable pursuant to said
SECTION 11.6(b)(1) to be paid by the Replacement Financing Party)
pursuant to which the Replacement Financing Party shall acquire the
Commitment, Class A-1 Notes and participation in Letters of Credit of
the Replaced Financing Party and, in connection therewith, shall pay to
(x) the Replaced Financing Party in respect thereof an amount equal to
the sum of (A) the principal of such Class A-1 Notes and interest
thereon, (B) an amount equal to all drawings under Letters of Credit
that have been funded by (and not reimbursed to) such Replaced
Financing Party, together with all then unpaid interest with respect
thereto at such time, (C) if applicable, an amount equal to the
increased costs incurred by LTV Steel and owing to the Replaced
Financing Party pursuant to SECTIONS 4.5 and 4.7 and (D) an amount
equal to all accrued, but theretofore unpaid, Fees owing to the
Replaced Financing Party pursuant to Article IV and (y) any Financing
Party the amount of all unreimbursed drawings under Letter of Credit
attributable to such Replaced Financing Party and (ii) all obligations
of LTV Steel owing to the Replaced Financing Party (other than those
specifically described in clause (i) above in respect of which the
assignment purchase price has been, or is concurrently being paid)
shall be paid in full by LTV Steel to such Replaced Financing Party
concurrently with such replacement. Upon the execution of the
respective Assignment and Assumption Agreement and the payment of
amounts referred to in clauses (i) and (ii), above the Replacement
Financing Party shall become a Financing Party hereunder and the
Replaced Financing Party shall cease to constitute a Financing Party
hereunder, except with respect to indemnification provisions under this
Agreement, which shall survive as to such Replaced Financing Party.
Section 11.7. CONFIDENTIALITY. (a) Each Financing Party agrees that it
will use its reasonable best efforts not to disclose without the prior consent
of LTV Steel (other than to its employees,
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auditor, or counsel or to another Financing Party if the disclosing Financing
Party or such disclosing Financing Party's holding or parent company in its sole
discretion determines that any such party should have access to such
information) any information with respect to LTV Steel or any of its Affiliates,
which is furnished pursuant to the Transaction Documents and which is designated
by LTV Steel in writing as confidential; provided, that any Financing Party may
disclose any such information (a) as has become generally available to the
public, (b) as may be required or appropriate in any report, statement or
testimony submitted to any Governmental Authority having or claiming to have
jurisdiction over such Financing Party, (c) as may be required or appropriate in
response to any summons or subpoena or in connection with any litigation, (d) in
order to comply with any Requirement of Law, and (e) to any prospective or
actual transferee or participant in connection with any contemplated transfer or
participation of any commitments or any interest therein by such Financing Party
which prospective transferee or participant shall have agreed in writing to be
subject to the confidentiality provisions of this SECTION 11.7; provided,
however, that in the case of any disclosure pursuant to the foregoing clauses
(c) or (d), such Financing Party will use its reasonable efforts to notify LTV
Steel, to the extent permitted as advised by counsel, in advance (or, in the
case of clause (d), if advance notice is not possible, promptly thereafter) of
such disclosure so as to afford LTV Steel the opportunity to protect the
confidentiality of the information proposed to be so disclosed.
(b) Each Financing Party may share confidential information
with its Affiliates including information relating to the
creditworthiness of LTV Steel and its Affiliates) so long as such
Affiliate is bound by SECTION 11.7(a).
Section 11.8. INDEMNIFICATION. (a) LTV Steel shall and hereby agrees to
indemnify, defend and hold harmless the Placement Agent, the Administrative
Agent and each Financing Party and their respective directors, officers, agents
and employees (the "Indemnitee) from and against (x) any and all losses, claims,
damages, liability, deficiencies, judgments or expenses incurred by any of them
(except to the extent that it is finally judicially determined to have resulted
from either (x) their own gross negligence or willful misconduct or (y) the
failure of the Issuer of the Class A-1 Notes to pay any sums due and owing
thereunder to the Holders thereof) arising out of or by reason of any
litigation, investigations, claims or proceedings which arise out of or are in
any way related to (i) this Agreement or the transaction contemplated hereby,
(ii) the issuance of the Letters of Credit, (iii) the failure of an Issuing
Lender to honor a drawing under any Letter of Credit, as a result of any act or
omission, whether right or wrong, of any present or future DE JURE or DE FACTO
government or Governmental Authority, (iv) the Placement Agent's, the
Administrative Agent's or the Financing Party's entering into this Agreement, or
any other agreements and documents relating hereto, including, without
limitation, amounts paid in any settlement agreed to by LTV Steel, court costs
and the reasonable fees and disbursements of counsel incurred in connection with
any such litigation, investigation, claim or proceeding or any advice rendered
in connection with any of the foregoing and (y) any such losses, claims,
damages, liabilities, deficiencies, judgments or expenses incurred in connection
with any remedial or other action taken by LTV Steel or any of the Financing
Parties in connection with compliance by LTV Steel or any of its Affiliates, or
any of their respective
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properties, with any environmental laws or any other federal, state or local
acts, rules, regulations, orders, directions, ordinances, criteria or guidelines
or arising from any environmental claim.
(b) If and to the extent that the Obligations of LTV Steel
under this SECTION 11.8 are unenforceable for any reason, LTV Steel
hereby agrees to make the maximum contribution to the payment and
satisfaction of such Obligations which is permissible under applicable
law. LTV Steel's Obligations under this SECTION 11.8 shall survive any
termination of this Agreement and the other Transaction Documents and
the payment in full of the Obligations in respect of Letters of Credit,
interest and Fees, and are in addition to, and not in substitution of,
any other of its Obligations set forth in this Agreement.
(c) In addition, LTV Steel shall, upon demand, pay to the
Placement Agent, the Administrative Agent and the Financing Parties all
costs and expenses (including the reasonable fees and disbursements of
counsel and other professionals) paid or incurred by the Placement
Agent or the Administrative Agent at any time or by such Financing
Party after the occurrence and during the continuance of a Note
Purchase Agreement Event of Default, in (i) enforcing or defending its
rights under or in respect of this Agreement or any other document or
instrument now or hereafter executed and delivered in connection
herewith, (ii) in foreclosing or otherwise collecting upon the
Collateral or the pledged Notes or any part thereof and (iii) obtaining
any legal, accounting or other advice in connection with any of the
foregoing.
Section 11.9. HEADINGS DESCRIPTIVE. The headings of the several
sections and subsections of this Agreement, and the Table of Contents, are
inserted for convenience only and shall not in any way affect the meaning or
construction of any provision of this Agreement.
Section 11.10. AMENDMENT OR WAIVER. Neither this Agreement nor any
other Transaction Document nor any terms hereof or thereof may be changed,
waived, discharged or terminated unless such change, waiver, discharge or
termination (i) is not material, (ii) relates to the Price and Fees Agreement or
(iii) is in writing signed by LTV Steel and the Required Financing Parties,
provided that no change, waiver, discharge or termination shall (1) without the
consent of the relevant Financing Party in its capacity as an Issuing Lender,
extend the expiration date of any Letter of Credit beyond the Expiration Date
applicable to the Commitment of such Financing Party or (B) without the consent
of each of the Financing Parties affected thereby, (1) extend the stated
Expiration Date, reduce the rate or extend the time of payment of interest or
Fees thereon (other than the waiver of post-default rates of interest or Fees),
or reduce the amount thereof, or increase the Commitment of any Financing Party
over the amount thereof then in effect (it being understood that a waiver of any
Note Purchase Agreement Default or Note Purchase Agreement Event of Default, or
mandatory prepayment, shall not constitute an increase in any Commitment of any
Financing Party), (2) release all or substantially all of the Collateral (except
as expressly provided in the Transaction Documents), (3) amend, modify or waive
any provisions of this Section, (4) reduce the percentage specified in the
definition of Required Financing Parties or (5) consent to the assignment or
transfer by LTV Steel of any of its rights and obligations under any Transaction
Documents. No
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provision of Article 3, 10 or 11 may be amended without the consent of each
Issuing Lender, and the Agents.
Section 11.11. NONLIABILITY OF PLACEMENT AGENT, THE ADMINISTRATIVE
AGENT AND FINANCING PARTIES. The relationship between LTV Steel and the
Financing Parties, the Placement Agent and the Administrative Agent shall be
solely that of borrower and lender. None of the Placement Agent, the
Administrative Agent, or any Financing Party shall have any fiduciary
responsibilities to LTV Steel. None of the Placement Agent, the Administrative
Agent or any Financing Party undertakes any responsibility to LTV Steel or any
of its Affiliates to review or inform LTV Steel or any of its Affiliates of any
matter in connection with any purchase of the business or operations of LTV
Steel or any of its Affiliates.
Section 11.12. COUNTERPARTS. This Agreement may be executed in any
number of counterparts and by the different parties hereto in separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument.
Section 11.13. EFFECTIVENESS. This Agreement shall become effective on
the Effective Date.
Section 11.14. MAXIMUM RATE. Notwithstanding anything to the contrary
contained elsewhere in this Agreement or in any other Transaction Document, LTV
Steel, the Placement Agent, the Administrative Agent and the Financing Parties
hereby agree that all agreements among them under this Agreement and the other
Transaction Documents, whether now existing or hereafter arising and whether
written or oral, are expressly limited so that in no contingency or event
whatsoever shall the amount paid, or to be paid, to the Placement Agent, the
Administrative Agent or any Financing Party for the use, forbearance, or
detention of the money loaned to LTV Steel and evidenced hereby or thereby or
for the performance or payment of any covenant or obligation contained herein or
therein, exceed the Highest Lawful Rate. If due to any circumstances whatsoever,
fulfillment of any provision of this Agreement or any of the other Transaction
Documents at the time performance of such provision shall be due shall exceed
the Highest Lawful Rate, then, automatically, the obligation to be fulfilled
shall be modified or reduced to the extent necessary to limit such interest to
the Highest Lawful Rate, and if from any such circumstance any Financing Party
shall ever receive anything of value deemed interest by applicable law which
would exceed the Highest Lawful Rate, such excessive interest shall be applied
to the reduction of the principal amount then outstanding hereunder or on
account of any other then outstanding Obligations and not to the payment of
interest, or if such excessive interest exceeds the principal unpaid balance
then outstanding hereunder and such other then outstanding Obligations, such
excess shall be refunded to LTV Steel. All sums paid or agreed to be paid to the
Placement Agent, the Agent or any Financing Party for the use, forbearance, or
detention of the Obligations and other Indebtedness of LTV Steel to any such
party shall, to the extent permitted by applicable law, be amortized, prorated,
allocated and spread throughout the full term of such Indebtedness until payment
in full so that the actual rate of interest on account of all such Indebtedness
does not exceed the Highest Lawful Rate throughout the entire term of such
Indebtedness. The terms and provisions of this Section shall
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control every other provision of this Agreement and all agreements among LTV
Steel, the Placement Agent, the Administrative Agent and the Financing Parties.
Section 11.15. RIGHT OF SETOFF. In addition to and not in limitation of
all rights of offset that any Financing Party or any Issuing Lender may have
under applicable law, each Financing Party shall, upon the failure of any
account party under any Letter of Credit to promptly reimburse the Issuing
Lender pursuant to the terms of this Agreement, have the right, upon prior
notice to such account party, to appropriate and apply to the payment of such
reimbursement obligations of such account party all debts (general or special,
time or demand, provisional or final) then or thereafter held by and other
indebtedness then or thereafter owing to such account party by such Financing
Party. Each Financing Party exercising such rights shall notify the respective
Agent thereof and any amount received as a result of the exercise of such rights
shall be reallocated among the Financing Parties as set forth in SECTION 4.8
hereof; provided, however, that failure of such account party to receive such
notice shall not impair any Financing Party's rights hereunder.
Section 11.16 Extension of Facility.
----------------------
(a) EXTENSION REQUEST. Within thirty Business Days of
each anniversary of the Effective Date, LTV Steel may
provide a written request to the Administrative Agent
and the Placement Agent with respect to the extension
of the Expiration Date (such notice, an "Extension
Request"). Each Extension Request shall indicate the
aggregate Commitment being requested and the date to
which it is requested that the Expiration Date be
extended, which shall be not less than one year from
the then effective Expiration Date applicable to such
Commitments nor more than five years from the date of
such Extension Request.
(b) ACCEPTANCE. Each Financing Party shall have the
independent right to accept or decline the proposed
extension of the Expiration Date by providing a
written notice of its decision within fifteen
Business Days of notice from the Agents that LTV
Steel has submitted an Extension Request; provided
that the failure of a Financing Party to provide
written notice of its decision during such time
period shall constitute a decline of the proposed
extension. If one or more Financing Parties declines
to accept such extension, the remaining Financing
Parties may, but shall have no obligation to, assume
the Commitments of the declining Financing Parties.
If the remaining Financing Parties decline to assume
such Commitments, LTV Steel may identify other
institutions willing to assume such Commitments, and
if acceptable to the Agents, such institutions shall
become Financing Parties and assume such Commitments
in accordance with SECTION 11.6(b)(1) hereof.
Promptly after receipt of notice from each Financing
Party as to its decision whether to extend the
Expiration Date, but in any event on or before the
twelfth Business
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Day after receipt of an Extension Request, the
Administrative Agent shall provide notice to LTV
Steel as to the identity and Commitment amount of
each Financing Party electing to extend the
Expiration Date. Each Financing Party's agreement to
extend the Expiration Date shall constitute such
Person's agreement to extend the Expiration Date with
respect to any Note held or to be held by it for
purposes of the Trust Agreement.
(c) EFFECTIVENESS. If less than the Commitment amount
specified by LTV Steel is represented by the
aggregate Commitments of extending Financing Parties,
LTV Steel may accept such lesser amount of
Commitments, provided that the aggregate Commitments
accepted (and consequent size of the Facility) may
not be less than $100,000,000 (the "Minimum Amount").
If Financing Parties holding aggregate Commitments at
least equal to the Minimum Amount agree to such
extension, the Expiration Date with respect to such
Commitments shall be so extended.
Each extension of the Expiration Date shall be
effective from and after the Expiration Date as in
effect prior to such extension up until the
Expiration Date as so extended. No extension of the
Expiration Date under this Section 11.16 shall affect
the rights and obligations of LTV Steel or the
Financing Parties prior to the date of effectiveness
of such extension. Commitments of Financing Parties
declining to extend the Expiration Date shall remain
in effect until the Expiration Date applicable
thereto. Letters of Credit issued by any Financing
Party in its capacity as Issuing Lender declining to
extend the Expiration Date shall expire not later
than the Expiration Date applicable to the Commitment
of such Financing Party, unless such Letter of Credit
is assumed by another Issuing Lender which has agreed
to the extended Expiration Date. No Letter of Credit
shall be issued, renewed or extended if, after giving
effect to such issuance, renewal or extension, the
aggregate face amount of Letters of Credit expiring
after any Expiration Date applicable to any Lender's
Commitment would exceed the Aggregate Commitment
Amount that will be in effect immediately after such
Expiration Date, unless arrangements reasonably
satisfactory to each relevant Issuing Lender and the
Administrative Agent shall have been made by LTV
Steel to provide cash or other collateral to the
extent of any excess.
Section 11.17 INSPECTION OF INVENTORY. In its capacity as Servicer, LTV
Steel agrees to allow the Administrative Agent, the Placement Agent and their
duly appointed representatives to make such inspection or review of the
Purchased Inventory as the Administrative Agent or Placement Agent shall deem
appropriate on behalf of the Financing Parties. In such regard the Servicer
shall allow any such Persons access to the sites where Purchased Inventory is
held or processed and access to the Books and Records of the Servicer relating
to the Purchased Inventory. Any such inspection or review shall be limited to
the normal business hours of the Servicer and shall
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be conducted only after reasonable notice to the Servicer. Any such inspection
or review shall be at the expense of LTV Steel Products, provided that prior to
the occurrence of an Amortization Date without its written consent, LTV Steel
Products shall not be responsible for an aggregate of more than $40,000 in such
expenses during any calendar year.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their proper and duly authorized officers as of the
date first date set forth above.
LTV STEEL COMPANY, INC.
a New Jersey corporation, individually
and as agent for the Affiliates listed
on Schedule IV
By
-------------------------------------
Printed Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
CHASE SECURITIES INC., as Placement
Agent
By
-------------------------------------
Printed Name:
------------------------
Title:
--------------------------------
THE CHASE MANHATTAN BANK,
a New York banking corporation, as
Administrative Agent
By
-------------------------------------
Printed Name:
------------------------
Title:
--------------------------------
THE CHASE MANHATTAN BANK,
a New York banking corporation, as
Collateral Agent
By
-------------------------------------
Printed Name:
------------------------
Title:
--------------------------------
56
Schedule I
Financing Party Commitment Amount Letter of Credit Limit
--------------- ----------------- ----------------------
[60% OF COMMITMENT
AMOUNT]
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