Exhibit 10.5
AMENDED AND RESTATED SUPPLY AGREEMENT
AMENDED AND RESTATED SUPPLY AGREEMENT dated as of the 29th day of
March, 1993, between WHEELING-PITTSBURGH STEEL CORPORATION, a Delaware
corporation ("W-P"), 0000 Xxxxxx Xxxxxx, Xxxxxxxx, Xxxx Xxxxxxxx 00000, and
WHEELING-NISSHIN, INC., a Delaware corporation ("W-N"), Penn and Xxxx Xxxxxxx,
Xxxxxxxxxx, Xxxx Xxxxxxxx 00000.
W I T N E S S E T H:
WHEREAS, W-P and W-N entered into a Raw Materials Supply Agreement
dated as of March 5, 1986 providing for the supply of raw materials by W-P to
W-N, which, by an Amendment thereto dated as of November 12, 1990, they agreed,
among other things, to amend and restate in its entirety as more fully set forth
herein (such Supply Agreement, as so amended and in effect prior to the
effective date of this Agreement, the "Prior Supply Agreement");
WHEREAS, W-P and W-N desire that W-N shall operate profitably,
efficiently and safely for the benefit of W-N's stockholders;
WHEREAS, W-N desires to keep itself a profitable company by using its
best efforts to minimize costs and maximize productivity and quality; and
WHEREAS, W-P desires to keep W-N a profitable company by using its best
efforts to supply W-N with Raw Materials (hereinafter defined) in a manner
compatible with W-N's competitive market situation;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties
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agree to amend and restate the Prior Supply Agreement to read in its entirety as
set forth in this Amended and Restated Supply Agreement:
1. Definitions. As used in this Agreement, the following terms shall
have the meanings set forth below or as set forth in the Section listed opposite
such term:
1.1. "Force Majeure" - as set forth in Section 9.
1.2. "Purchase Price" - as set forth in Section 4.
1.3 "Raw Materials" - as set forth in Section 2.1.
1.4. "Second Amended Shareholders Agreement" - the Second Amended and
Restated Shareholders Agreement dated as of November 12, 1990 between Nisshin
Steel Co., Ltd. and W-P.
2. Supply of Raw Materials.
2.1. Except as provided in Section 2.3, W-P shall supply and sell to
W-N, and W-N shall purchase from W-P, W-N's requirements for the types of
products described in Exhibit 2.1 (the "Raw Materials"). W-P shall supply to
W-N, and W-N shall purchase from W-P, not less than 75% of such requirements,
provided that W-P shall not be obligated to supply to W-N, and W-N shall not be
obligated to purchase from W-P, more than 9,000 net tons of Raw Materials in the
aggregate per week or more than the maximum quantity of each type of Raw
Material per week set forth on such Exhibit 2.1. If W-N shall require any such
Raw Material in quantities 75% of which would exceed such maximum quantities,
W-N shall give W-P the first opportunity to supply, and W-P shall use its best
efforts to supply, such additional quantities.
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2.2. Not less than 75 days prior to the first day of each calendar
quarter, W-P shall notify W-N of W-P's capacity to supply Raw Materials during
such quarter.
2.3. W-N may in its discretion purchase any Raw Material from suppliers
other than W-P (a) in such quantities, not to exceed 25% of W-N's requirements
for such Raw Material, as W-N determines in order that W-N may establish and
maintain satisfactory relationships with such other suppliers, (b) if W-P,
whether or not due to Force Majeure, fails or would in W-N's reasonable judgment
be unable to supply such Raw Material in accordance with this Agreement
(including without limitation provisions of this Agreement pertaining to the
quantity, quality and delivery of such Raw Material to be supplied by W-P), (c)
if W-P is unable to supply quantities of a Raw Material in excess of the maximum
quantity provided therefor in such Exhibit 2.1, or (d) if W-P and W-N, after
negotiation in good faith, fail to agree at least 45 days prior to the first day
of any calendar quarter or such other date as W-P and W-N may agree on the
Purchase Price for such Raw Material for such quarter.
3. Orders for Raw Materials. W-N shall furnish to W-P detailed orders
for Raw materials to be purchased pursuant to this Agreement. Such orders shall
include sizes, quantities, specifications and delivery schedules within such
lead times for delivery as W-N and W-P may have agreed.
4. Pricing of Raw Materials. W-P and W-N shall endeavor to determine,
not less than 45 days prior to the first day of each calendar quarter or such
other date as W-P and W-N may agree, the purchase price for each Raw Material to
be supplied by W-P to W-N during such
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quarter (the "Purchase Price"). The Purchase Price shall be determined by the
parties by negotiation based upon the pricing formula set forth in Exhibit 4.1.
5. Delivery of Raw Materials. W-P shall cause Raw Materials supplied
pursuant to this Agreement to be delivered on a "just-in-time" basis.
6. Specifications. Raw Materials supplied by W-P pursuant to this
Agreement shall strictly conform to the general specifications set forth in
Exhibit 6.1 and to such additional specifications as W-P and W-N may have
agreed.
7. Further Assurances. If W-N reasonably believes that W-P may be
unable to perform any of its obligations under this Agreement, W-N may notify
W-P thereof. If, within 60 days after such notice, W-P shall have failed to take
such actions as shall reasonably assure W-N of its ability to perform such
obligation, such failure by W-P shall, at W-N's option, be deemed to be a breach
of this Agreement.
8. W-P Plant Upgrade. W-P shall make the improvements to its
facilities described in Exhibit 8.1 in accordance with the schedule therefor set
forth in such Exhibit 8.1 to the extent not required by such schedule to be
made, and not made, prior to the date of this Agreement. W-P represents and
warrants that it has made the improvements to its facilities described in
Exhibit 8.1 in accordance with the schedule therefor set forth in such Exhibit
8.1 to the extent required by such schedule to be made prior to the date of this
Agreement. W-P shall maintain its facilities in sufficient operating condition
to be able to perform its obligations under this Agreement. In addition to any
other
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remedies which W-N may have, W-N shall not be obligated to purchase Raw
Materials from W-P unless W-P performs in accordance with this Section 8 and the
representation and warranty set forth in this Section 8 is accurate, true and
complete in all respects.
9. Force Majeure. Neither W-P nor W-N shall be liable to the other
for any loss or damage caused by its failure to perform its obligations under
this Agreement as a result of (a) acts of God, (b) strikes, labor troubles or
other industrial disturbances, (c) inevitable accidents, (d) declared or
undeclared war, insurrections or riots, (e) embargoes or blockades, (f)
governmental restrictions or (g) any other cause beyond the control of the
parties (any such event referred to as "Force Majeure"); provided, however, that
if W-P fails or would in W-N's reasonable judgment be unable to perform its
obligations under this Agreement as a result of any of the foregoing, then,
during the continuation of such event and for a reasonable time thereafter, W-N
may purchase Raw Materials from other persons as provided in Section 2.3. W-P
and W-N shall consult promptly and in good faith with the object of minimizing
the adverse effects of such event.
10. Term. This Agreement shall continue until the 20th anniversary of
the date of this Agreement; provided, however, that W-N may, by written notice
to W-P, terminate this Agreement if at any time W-P and its subsidiaries and
parent, if any, in the aggregate shall own less than 20% of the common stock of
W-N or WP shall breach the Second Amended Shareholders Agreement.
11. Security for Performance by W-P. W-P shall supply such collateral
as shall be mutually satisfactory to W-N and W-P (in addition
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to that otherwise contemplated by this Agreement or the Second Amended
Shareholders Agreement) to secure the performance of W-P's obligations under
this Agreement and the Second Amended Shareholders Agreement.
12. Notices. All communications under this Agreement shall be given
by any method that is customary in the industry to the parties at their
respective addresses set forth above. A party may change its address by giving
notice thereof to the other party of such new address and, upon the giving of
such notice, such new address shall be deemed to be such party's address for
purposes of the giving of notices pursuant to this Agreement.
13. No Assignment. This Agreement shall not be assigned by either
party without the written consent of the other party hereto; provided, however,
that if a party hereto shall merge into or consolidate with another corporation,
no such consent shall be required for an assignment by such party to such
surviving corporation in connection with such merger or consolidation.
14. Entire Agreement; Construction. This Agreement embodies the
entire agreement and understanding between the parties hereto, and supersedes
all prior agreements and understandings between them, relating to the subject
matter of this Agreement. Notwithstanding the preceding sentence, it is the
intention of the parties that certain matters referenced in Agreement shall be
the subject of further negotiation and specification and shall be recorded in
subsequent written agreements, instruments or documents. The headings contained
in this Agreement are for convenience only and shall not in any way affect the
meaning or
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interpretation of any term or provision of this Agreement. References to
Sections and Exhibits in this Agreement are to Sections of this Agreement and to
Exhibits attached to this Agreement. The Exhibits are part of this Agreement.
Unless the context otherwise requires, references to "parties" in this Agreement
are to the parties to this Agreement. In this Agreement, to the extent the
context requires, the use of any personal pronoun, whether used in the
masculine, feminine or neuter gender, includes all other genders. The word
"person" as used in this Agreement includes, without limitation, an individual,
corporation, partnership, trust, association, business, firm or other entity.
15. Arbitration. Except for controversies or claims which may arise
out of or after, relate to, or are first raised after termination of this
Agreement, all controversies or claims between the parties which may arise out
of or relate to this Agreement, or any alleged modification or breach hereof,
shall be settled by arbitration conducted at the offices of W-N pursuant to the
rules of the American Arbitration Association, and judgment upon the award
rendered by the arbitrators may be entered in any court having jurisdiction
thereof.
16. Amendments. This Agreement may not be amended except by an
instrument in writing signed by the party against which enforcement of such
amendment is sought.
17. Rights and Remedies. If W-P shall default in any of its
obligations under or otherwise be in breach of this Agreement, W-N may suspend
or terminate its obligation to purchase Raw Materials from W-P, terminate this
Agreement, exercise its remedies with respect to collateral provided by W-P,
obtain specific performance or an injunction, obtain
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damages and exercise any other remedies available to it pursuant to this
Agreement or otherwise. The rights and remedies provided by this Agreement are
cumulative and the use of any one right or remedy by any party shall not
preclude or waive its right to use any or all other remedies. Such rights and
remedies are given in addition to any other rights and remedies such party may
have by law, statute, ordinance or otherwise.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
WHEELING-PITTSBURGH STEEL
CORPORATION
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
Title: Chairman, President and Chief
Executive Officer
WHEELING-NISSHIN, INC.
By: /s/ Xxxxxx Xxxxxx
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Name: Xxxxxx Xxxxxx
Title: Chairman of the Board and
Chief Executive Officer
By: /s/ Xxxx X. Xxxxxx, III
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Name: Xxxx X. Xxxxxx, III
Title: President and Chief Operating
Officer
