Exhibit 10.2
INTERNATIONAL STEEL GROUP INC.
FIRST AMENDMENT TO
CREDIT AND GUARANTY AGREEMENT
This FIRST AMENDMENT TO CREDIT AND GUARANTY AGREEMENT, dated
as of August 6, 2003 (this "AMENDMENT"), is entered into by and among
INTERNATIONAL STEEL GROUP INC., a Delaware corporation (the "COMPANY"), ISG
ACQUISITION INC., a Delaware corporation and wholly-owned subsidiary of the
Company ("ISG ACQUISITION"), ISG CLEVELAND INC., ISG HENNEPIN INC., ISG INDIANA
HARBOR INC., ISG XXXXXX INC., ISG RIVERDALE INC., ISG PLATE INC., ISG PIEDMONT
INC., ISG XXXXX HARBOR INC., ISG SPARROWS POINT INC., ISG STEELTON INC., and ISG
LACKAWANNA INC. (each a "BORROWER" and collectively, the "BORROWERS"), the
CREDIT SUPPORT PARTIES listed on the signature pages hereto, the Lenders listed
on the signature pages hereto, UBS AG, STAMFORD BRANCH ("UBS"), as
Administrative Agent (together with its permitted successors in such capacity,
"ADMINISTRATIVE AGENT"), XXXXXXX XXXXX CREDIT PARTNERS L.P. ("GSCP"), as
Syndication Agent (in such capacity, "SYNDICATION AGENT"), THE CIT
GROUP/BUSINESS CREDIT, INC. ("CIT") as Collateral Agent (together with its
permitted successor in such capacity, "COLLATERAL AGENT"), FLEET CAPITAL
CORPORATION ("FLEET") as Co-Documentation Agent and LASALLE BANK NATIONAL
ASSOCIATION ("LASALLE") as Co-Documentation Agent (together with Fleet, the
"DOCUMENTATION AGENTS"), and is made with reference to that certain Credit and
Guaranty Agreement, dated as of May 7, 2003 (the "CREDIT AGREEMENT").
Capitalized terms used herein not otherwise defined herein or otherwise amended
hereby shall have the meanings ascribed thereto in the Credit Agreement.
RECITALS:
WHEREAS, the Company and the Borrowers have requested that the
Lenders agree to make amendments to certain provisions of the Credit Agreement;
and
WHEREAS, the Lenders have agreed to amend certain provisions
of the Credit Agreement, in the manner, and on the terms and conditions,
provided for herein.
NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, the parties hereto agree
as follows:
SECTION I. AMENDMENTS TO CREDIT AGREEMENT
Upon satisfaction of the conditions set forth in Section II.A. herein,
the Credit Agreement shall be amended as follows in this Section I:
A. AMENDMENTS TO SECTION 1: DEFINITIONS
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(a) The definition of "CCC GUARANTY OBLIGATIONS" in Section
1.1 of the Credit Agreement is hereby amended to delete the proviso appearing at
the end of such definition and replace it with the following:
"provided, however, that (i) the giving of any guaranty in accordance
with subparts (a) and (d) of this definition shall not be deemed to constitute
an "Investment" for any purposes of this Agreement, but any payment thereunder
shall constitute an Investment and shall only be permitted if and to the extent
that any such payment would constitute an Investment permitted pursuant to
Section 6.7, (ii) the giving of any guaranty in accordance with subpart (b) of
this definition, and any payments with respect thereto or rights of subrogation
that arise therefrom, shall not be deemed to constitute an "Investment" for any
purposes of this Agreement, (iii) the pledge of Capital Stock of Columbus
Coatings pursuant to subpart (c) above, and any foreclosure thereon, shall not
deemed to be an "Investment" hereunder, and (iv) the incurrence of any
obligations by ISG Cleveland Inc. or ISG Xxxxx Harbor Inc. in accordance with
subpart (f) of this definition shall not be deemed to constitute an "Investment"
hereunder, but any payments made with respect to the obligations set forth in
subpart (f) above (other than any payments or any portion thereof that are made
on arms length terms that would reasonably be expected to be paid by a purchaser
to an unaffiliated seller of goods or services of the same type) shall be deemed
an "Investment" hereunder and shall only be permitted if and to the extent that
any such payments would constitute an Investment permitted pursuant to Section
6.7."
(b) The definition of "GUARANTOR" in Section 1.1 of the Credit
Agreement is hereby amended and restated in its entirety to read as follows:
"'GUARANTOR' means each of the Company and each Domestic
Subsidiary of the Company (other than the Borrowers and the Specified
Subsidiaries); provided, however, that ISG Real Estate Inc. shall be a
"Guarantor" hereunder."
B. AMENDMENTS TO SECTION 5: AFFIRMATIVE COVENANTS.
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Section 5.10 of the Credit Agreement is hereby amended by
inserting the letter "(a)" after the section heading "5.10. SUBSIDIARIES." and
before the paragraph heading "Domestic Subsidiaries.".
C. AMENDMENTS TO SECTION 6: NEGATIVE COVENANTS.
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(a) Section 6.1 of the Credit Agreement is hereby amended by
(i) deleting the word "and" appearing immediately preceding subsection (p), (ii)
deleting the period at the end of subsection (p) and inserting "; and" in lieu
thereof, and (iii) adding the following clause (q) at the conclusion thereof:
"(q) Indebtedness of any Specified Subsidiary to any other
Specified Subsidiary."
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(b) Section 6.6 of the Credit Agreement is hereby amended by
inserting in clause (d) thereof the words ", in the case of each clause above"
after the words "or any other Subsidiary of the Company" and before the words
"other than restrictions".
(c) Section 6.7 of the Credit Agreement is hereby amended by
re-lettering the second paragraph (l) appearing therein as "(m)".
(d) Section 6.7 of the Credit Agreement is hereby further
amended by (i) deleting the word "and" appearing immediately preceding
subsection (m) (as re-lettered pursuant to this Amendment), (ii) deleting the
period at the end of such subsection (m) and inserting "; and" in lieu thereof,
and (iii) adding the following clause (n) at the conclusion thereof:
"(n) (i) intercompany loans permitted under Section 6.1(q),
and (ii) Investments by any Specified Subsidiary in any other Specified
Subsidiary."
(e) Section 6.10 of the Credit Agreement is hereby amended and
restated in its entirety to read as follows:
"6.10 DISPOSAL OF SUBSIDIARY INTERESTS. Except for (i) any
sale of all of its interests in the Capital Stock of any of its Subsidiaries in
compliance with the provisions of Section 6.9, (ii) the pledge of, or granting
of a security interest in, all or any of the Capital Stock of Columbus Coatings
by the Company or any Subsidiary of the Company in connection with the CCC Debt
and (iii) Permitted Liens, no Credit Party shall, nor shall it permit any of its
Subsidiaries to, (a) directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any Capital Stock of any of its Subsidiaries, except to
qualify directors if required by applicable law; or (b) permit any of its
Subsidiaries directly or indirectly to sell, assign, pledge or otherwise
encumber or dispose of any Capital Stock of any of its Subsidiaries, except to
another Credit Party (subject to the restrictions on such disposition otherwise
imposed hereunder), or to qualify directors if required by applicable law."
SECTION II. CONDITIONS PRECEDENT TO EFFECTIVENESS
A. The effectiveness of the amendments set forth in Section I hereof
are subject to the satisfaction, or waiver by the Requisite Lenders, of the
following conditions on or before the date hereof (the "EFFECTIVE DATE"):
(a) The Company, the Borrowers, the other Credit Parties and
the Requisite Lenders shall have indicated their consent by the execution and
delivery of the signature pages hereof to the Administrative Agent.
(b) The representations and warranties contained in Section
III herein and in the other Credit Documents are true and correct in all
material respects on and as of the Effective Date to the same extent as though
made on and as of the Effective Date, except to the extent such representations
and warranties specifically relate to an earlier date, in which case such
representations and warranties are true and correct in all material respects on
and as of such earlier date.
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(c) As of the Effective Date, no event shall have occurred and
be continuing that would constitute an Event of Default or a Default.
(d) The Administrative Agent and Lenders shall have received
such other documents and information regarding Credit Parties and the Credit
Agreement as the Administrative Agent or Lenders may reasonably request.
SECTION III. REPRESENTATIONS AND WARRANTIES
A. CORPORATE POWER AND AUTHORITY. Each Credit Party has all requisite
corporate power and authority to enter into this Amendment and to carry out the
transactions contemplated by, and perform its obligations under, this Amendment.
B. AUTHORIZATION OF AGREEMENTS. The execution and delivery of this
Amendment has been duly authorized by all necessary corporate or partnership (as
applicable) action on the part of each Credit Party.
C. BINDING OBLIGATION. This Amendment has been duly executed and
delivered by each Credit Party and constitutes a legal, valid and binding
obligation of each Credit Party enforceable against each Credit Party in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, moratorium, reorganization or other similar laws
affecting creditors' rights generally and except as enforceability may be
limited by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
D. INCORPORATION OF REPRESENTATIONS AND WARRANTIES FROM CREDIT
DOCUMENTS. The representations and warranties contained in the Credit Documents
are and will be true and correct in all material respects on and as of the
Effective Date to the same extent as though made on and as of that date, except
to the extent such representations and warranties specifically relate to an
earlier date, in which case they were true and correct in all material respects
on and as of such earlier date .
E. ABSENCE OF DEFAULT. No event has occurred and is continuing or will
result from the consummation of the transactions contemplated by this Amendment
that would constitute an Event of Default or a Default.
SECTION IV. ACKNOWLEDGMENT AND CONSENT
Each of the Company, each wholly-owned Domestic Subsidiary of
the Company (other than the Borrowers and the Specified Subsidiaries) and ISG
Real Estate Inc. has (i) guaranteed the Obligations and (ii) (other than ISG
Real Estate Inc.) created Liens in favor of Lenders on the Collateral to secure
the Obligations subject to the terms and provisions of the Credit Agreement.
Each of the Company, ISG Real Estate Inc., and each wholly-owned Domestic
Subsidiary of the Company who has guaranteed the Obligations are collectively
referred to herein as the "CREDIT SUPPORT PARTIES", and the Credit Agreement and
the Collateral Documents are collectively referred to herein as the "CREDIT
SUPPORT DOCUMENTS".
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Each Credit Support Party hereby acknowledges that it has
reviewed the terms and provisions of the Credit Agreement and this Amendment and
consents to the amendment of the Credit Agreement effected pursuant to this
Amendment. Each Credit Support Party hereby confirms that each Credit Support
Document to which it is a party or otherwise bound and all Collateral encumbered
thereby will continue to guarantee or secure, as the case may be, to the fullest
extent possible in accordance with and subject to the Credit Support Documents
the payment and performance of all "Obligations" under each of the Credit
Support Documents, as the case may be (in each case as such terms are defined in
the applicable Credit Support Document), including without limitation the
payment and performance of all such "Obligations" under each of the Credit
Support Documents, as the case may be, in respect of the Obligations of the
Company now or hereafter existing under or in respect of the Credit Agreement
and hereby pledges and assigns to the Collateral Agent, and grants to the
Collateral Agent a continuing lien on and security interest in and to all
Collateral as collateral security for the prompt payment and performance in full
when due of the "Obligations" under each of, and in accordance with and subject
to, the Credit Support Documents to which it is a party (whether at stated
maturity, by acceleration or otherwise).
Each Credit Support Party acknowledges and agrees that all of
the Credit Support Documents to which it is a party or otherwise bound shall
continue in full force and effect and that all of its obligations thereunder
shall be valid and enforceable and shall not be impaired or limited by the
execution or effectiveness of this Amendment. Each Credit Support Party
represents and warrants that all representations and warranties contained in the
Credit Agreement, this Amendment and the Credit Support Documents to which it is
a party or otherwise bound are true and correct in all material respects on and
as of the Effective Date to the same extent as though made on and as of the
Effective Date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case they were true, correct
and complete in all material respects on and as of such earlier date.
Each Credit Support Party acknowledges and agrees that (i)
notwithstanding the conditions to effectiveness set forth in this Amendment,
such Credit Support Party (other than the Company) is not required by the terms
of the Credit Agreement or any other Credit Document to consent to the
amendments to the Credit Agreement effected pursuant to this Amendment and (ii)
nothing in the Credit Agreement, this Amendment or any other Credit Document
shall be deemed to require the consent of such Credit Support Party (other than
the Company) to any future amendments to the Credit Agreement.
SECTION V. MISCELLANEOUS
A. BINDING EFFECT. This Amendment shall be binding upon the parties
hereto and their respective successors and assigns and shall inure to the
benefit of the parties hereto and the successors and assigns of Lenders. No
Credit Party's rights or obligations hereunder or any interest therein may be
assigned or delegated by any Credit Party without the prior written consent of
all Lenders.
B. SEVERABILITY. In case any provision in or obligation hereunder shall
be invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining
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provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.
C. REFERENCE TO CREDIT AGREEMENT. On and after the Effective Date, each
reference in the Credit Agreement to "this AGREEMENT", "hereunder", "hereof",
"herein" or words of like import referring to the Credit Agreement, and each
reference in the other Credit Documents to the "Credit Agreement", "thereunder",
"thereof" or words of like import referring to the Credit Agreement shall mean
and be a reference to the Credit Agreement as amended by this Amendment.
D. EFFECT ON CREDIT AGREEMENT. Except as specifically amended by this
Amendment, the Credit Agreement and the other Credit Documents shall remain in
full force and effect and are hereby ratified and confirmed.
E. EXECUTION. The execution, delivery and performance of this Amendment
shall not, except as expressly provided herein, constitute a waiver of any
provision of, or operate as a waiver of any right, power or remedy of any Agent
or Lender under, the Credit Agreement or any of the other Credit Documents.
F. HEADINGS. Section headings herein are included herein for
convenience of reference only and shall not constitute a part hereof for any
other purpose or be given any substantive effect.
G. APPLICABLE LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
H. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument. As set forth herein, this Amendment shall become effective upon
the execution of a counterpart hereof by each of the parties hereto and receipt
by the Administrative Agent and the Syndication Agent of written or telephonic
notification of such execution and authorization of delivery thereof.
[The remainder of this page is intentionally left blank.]
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
COMPANY INTERNATIONAL STEEL GROUP INC.
By: /s/ Xxxxxx Xxxx
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Name: Xxxxxx Xxxx
Title: President
BORROWERS ISG ACQUISITION INC.
ISG CLEVELAND INC.
ISG HENNEPIN INC.
ISG INDIANA HARBOR INC.
ISG XXXXXX INC.
ISG RIVERDALE INC.
ISG PLATE INC.
ISG PIEDMONT INC.
ISG XXXXX HARBOR INC.
ISG SPARROWS POINT INC.
ISG STEELTON INC.
ISG LACKAWANNA INC.
By: /s/ Xxxxxx Xxxx
------------------------------------------
Name: Xxxxxx Xxxx
Title: President
CREDIT SUPPORT PARTIES
ISG RAILWAYS INC.
ISG/EGL HOLDING COMPANY
ISG CLEVELAND WORKS RAILWAY COMPANY
ISG SOUTH CHICAGO & INDIANA HARBOR RAILWAY COMPANY
ISG VENTURE INC.
ISG SALES INC.
ISG CLEVELAND WEST INC.
ISG CLEVELAND WEST PROPERTIES INC.
ISG TECHNOLOGIES INC.
ISG REAL ESTATE INC.
ISG HIBBING INC.
HIBBING TACONITE HOLDING INC.
By: /s/ Xxxxxx Xxxx
------------------------------------------
Name: Xxxxxx Xxxx
Title: President
ADMINISTRATIVE AGENT AND
ISSUING BANK UBS AG, STAMFORD BRANCH
By: /s/ Xxxxxxxx X'Xxxxx
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Name: Xxxxxxxx X'Xxxxx
Title: Director
LENDER AND SWING LINE LENDER UBS AG, CAYMAN ISLANDS BRANCH
By: /s/ Xxxxxxxx X'Xxxxx
------------------------------------------
Name: Xxxxxxxx X'Xxxxx
Title: Director
JOINT LEAD ARRANGER, JOINT
BOOKRUNNER, SYNDICATION AGENT XXXXXXX XXXXX CREDIT PARTNERS L.P.
AND A LENDER
By: /s/ Xxxxxx Xxxxxx
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Name: Xxxxxx Xxxxxx
Title: Authorized Signatory
COLLATERAL AGENT THE CIT GROUP/BUSINESS CREDIT,
AND A LENDER INC.
By: /s/ Xxxxxxx Xxxxxxxx
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Name: Xxxxxxx Xxxxxxxx
Title: Vice President
CO-DOCUMENTATION AGENT
AND A LENDER FLEET CAPITAL CORPORATION
By: /s/ Xxxxxxx Xxxxxxxxxx
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Name: Xxxxxxx Xxxxxxxxxx
Title: Vice President
CO-DOCUMENTATION AGENT LASALLE BANK NATIONAL
AND A LENDER ASSOCIATION
By: /s/ Xxxxx X. Cable
------------------------------------------
Name: Xxxxx X. Cable
Title: Assistant Vice President
