EXECUTION COPY
KEEPWELL AGREEMENT
KEEPWELL AGREEMENT (this "AGREEMENT"), dated December 28,
1995, made by Wheeling-Pittsburgh Steel Corporation, a Delaware corporation (the
"BORROWER"), Wheeling-Pittsburgh Corporation, a Delaware corporation
("HOLDINGS"), and WHX Corporation, a Delaware corporation ("WHX" and, together
with Holdings, the "OBLIGORS"), in favor of the Lender Parties referred to
below.
PRELIMINARY STATEMENTS:
1. The Borrower has entered into a Second Amended and Restated
Credit Agreement, dated as of December 28, 1995, with the financial institutions
party thereto and Citibank, N.A., as agent for said financial institutions (said
Agreement, as it may be amended or otherwise modified from time to time, being
the "CREDIT AGREEMENT").
2. Holdings owns beneficially and of record 100% of the
capital stock of the Borrower and WHX owns beneficially and of record 100% of
the capital stock of Holdings.
3. WHX and Holdings have agreed to provide certain assurances
to the Lender Parties with respect to the financial condition of the Borrower.
4. It is a condition precedent to the effectiveness of the
Credit Agreement and to the making of Loans and the issuance of Letters of
Credit that the Obligors shall have executed and delivered this Agreement.
NOW, THEREFORE, in consideration of the premises and to induce
the Lenders to make Loans and the Issuers to issue Letters of Credit, the
Obligors hereby agree as follows:
SECTION 1. CAPITALIZED TERMS. Capitalized terms used herein
and not otherwise defined herein, have the meanings specified in the Credit
Agreement. As used in this Agreement, the following terms shall mean:
"BANKRUPTCY CODE" means Title 11 of the United States Code,
any successor statute thereto or any similar United States federal or state law
for the relief of debtors.
"KEEPWELL PAYMENTS" has the meaning specified in Section 2.
SECTION 2. AGREEMENT. If the Loan Party Consolidated Group
maintains for any month included in each Fiscal Quarter set forth below
Cumulative Cash Flow for the period beginning on January 1, 1995 and ending on
the date of determination in an amount less than the amount set forth below:
MINIMUM
FOR THE PERIOD ENDING REQUIRED AMOUNT
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March 31, 1996 $ (35,000,000)
June 30, 1996 (45,000,000)
September 30, 1996 (55,000,000)
December 31, 1996 (65,000,000)
March 31, 1997 (75,000,000)
June 30, 1997 (85,000,000)
September 30, 1997 (90,000,000)
December 31, 1997 (90,000,000)
March 31, 1998 (100,000,000)
June 30, 1998 (105,000,000)
September 30, 1998 (110,000,000)
December 31, 1998 (110,000,000)
March 31, 1999 (110,000,000)
June 30, 1999 (110,000,000)
then each Obligor hereby, jointly and severally, unconditionally and irrevocably
promises to pay to the Agent, as a loan, capital contribution or advance to the
Borrower (such loans, capital contributions or advances being "KEEPWELL
PAYMENTS"), within three Business Days of the Agent's demand therefor, cash
funds in an amount such that, after giving effect to such Keepwell Payment, the
Loan Party Consolidated Group so maintains such amount of Cumulative Cash Flow.
Keepwell Payments shall be applied by the Agent to the Obligations in accordance
with Section 2.7(d) of the Credit Agreement.
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SECTION 3. REPAYMENT OF KEEPWELL PAYMENTS. The Borrower hereby
agrees to repay to WHX the Keepwell Payments only in accordance with the terms
and conditions of the Holdings Intercreditor Agreement and the Credit Agreement.
SECTION 4. AGREEMENT ABSOLUTE. The liability of each Obligor
under this Agreement shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of any provision of
any other Loan Document or any other agreement or instrument relating to any
Loan Document, or avoidance or subordination of any of the Obligations;
(b) any change in the time, manner or place of payment of, or
in any other term of, or any increase in the amount of, all or any of the
Obligations, or any other amendment or waiver of any term of, or any consent to
departure from any requirement of, the Credit Agreement or any of the other Loan
Documents;
(c) any exchange, release or non-perfection of any Lien on any
Collateral for, or any release or amendment or waiver of any term of any other
guaranty of, or any consent to departure from any requirement of any other
guaranty of, all or any of the Obligations;
(d) the absence of any attempt to collect any of the
Obligations from the Borrower or for any other guarantor or any other action to
enforce the same or the election of any remedy by any of the Lender Parties;
(e) any waiver, consent, extension, forbearance or granting of
any indulgence by any of the Lender Parties with respect to any provision of any
other Loan Document;
(f) the election by any of the Lender Parties in any
proceeding under chapter 11 of the Bankruptcy Code of the application of section
1111(b)(2) of the Bankruptcy Code;
(g) any borrowing or grant of a security interest by the
Borrower, as debtor- in-possession, under section 364 of the Bankruptcy Code;
(h) the disallowance, under section 502 of the Bankruptcy
Code, of all or any portion of the claims of any of the Lender Parties for
payment of any of the Obligations; or
(i) any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a borrower or a guarantor.
SECTION 5. WAIVER. (a) Each Obligor hereby (i) waives (A)
promptness, diligence, notice of acceptance and any and all other notices with
respect to any of the Obligations or this Agreement, (B) any requirement that
any of the Lender Parties protect, secure, perfect or insure any security
interest in or other Lien on any property subject thereto
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or exhaust any right or take any action against any Borrower or any other Person
or any Collateral, (C) the filing of any claim with a court in the event of
receivership or bankruptcy of any Borrower, (D) protest or notice with respect
to nonpayment of all or any of the Obligations, (E) the benefit of any statute
of limitation, (F) all demands whatsoever (and any requirement that same be made
on the Borrower as a condition precedent to such Obligor's obligations
hereunder); and (ii) covenants and agrees that this Agreement will not be
discharged except by complete performance of the Obligations and any other
obligations of such Obligor contained herein, except as otherwise provided in
Section 12.
(b) If, in the exercise of any of its rights and remedies, any
of the Lender Parties shall forfeit any of its rights or remedies, including,
without limitation, its right to enter a deficiency judgment against the
Borrower or any other Person, whether because of any applicable law pertaining
to "election of remedies" or the like, each Obligor hereby consents to such
action by such Lender Party and waives any claim based upon such action. Any
election of remedies which results in the denial or impairment of the right of
such Lender Party to seek a deficiency judgment against the Borrower shall not
impair any obligation of either Obligor contained herein.
(c) Each Obligor hereby assumes responsibility for keeping
itself informed of the financial condition of the Borrower and of each other
guarantor of all or any part of the Obligations, and of all other circumstances
bearing upon the risk of nonpayment of the Obligations or any part thereof, that
diligent inquiry would reveal. Each Obligor hereby agrees that the Lender
Parties shall have no duty to advise such Obligor of information known to any of
the Lender Parties regarding such condition or any such circumstance. In the
event that any of the Lender Parties in its sole discretion undertakes at any
time or from time to time to provide any such information to any Obligor, such
Lender Party shall be under no obligation (i) to undertake any investigation not
a part of its regular business routine, (ii) to disclose any information which,
pursuant to accepted or reasonable banking or commercial finance practice, such
Lender Party wishes to maintain confidential or (iii) to make any other or
future disclosure of such information or any other information to such Obligor.
SECTION 6. NO SUBROGATION, ETC. Each Obligor waives and
relinquishes any and all rights which it may acquire by way of subrogation,
contribution or reimbursement by reason of this Agreement or by any payment made
hereunder.
SECTION 7. REPRESENTATIONS AND WARRANTIES. To induce the
Lender Parties and the Agent to enter into the Credit Agreement, each Obligor
represents and warrants to the Lender Parties and the Agent that:
(a) CORPORATE EXISTENCE; COMPLIANCE WITH THE LAW. Each Obligor
(i) is a corporation duly organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation; (ii) is duly qualified as a
foreign corporation and in good standing under the laws of each jurisdiction,
except for failures which in the aggregate would
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have no Material Adverse Effect; (iii) has all requisite corporate power and
authority and the legal right to own, pledge, mortgage and operate its
properties, to lease the property it operates under lease and to conduct its
business as now or currently proposed to be conducted; (iv) is in compliance
with its certificate of incorporation and by-laws; (v) is in compliance with all
other applicable Requirements of Law, except for such non-compliances as would
in the aggregate have no Material Adverse Effect; and (vi) has all necessary
licenses, permits, consents or approvals from or by, has made all necessary
filings with, and has given all necessary notices to, each Governmental
Authority having jurisdiction, to the extent required for such ownership,
operation and conduct, except for licenses, permits, consents or approvals which
can be obtained by the taking of ministerial action to secure the grant or
transfer thereof or failures which, in the aggregate would have no Material
Adverse Effect.
(b) CORPORATE POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS.
(i) The execution, delivery and performance by each Obligor of the Loan
Documents to which it is a party and the consummation of the transactions
related to the financing contemplated hereby:
(A) are within such Obligor's corporate powers;
(B) have been duly authorized by all necessary corporate
action, including, without limitation, the consent of stockholders
where required; and
(C) do not (I) contravene such Obligor's certificate of
incorporation or by-laws or other comparable governing documents, (II)
as to such Obligor, violate any other applicable Requirement of Law
(including, without limitation, Regulations G, T, U and X of the Board
of Governors of the Federal Reserve System), or any order or decree of
any Governmental Authority or arbitrator, (III) conflict with or result
in the breach of, or constitute a default under, or result in or permit
the termination or acceleration of, any Contractual Obligation of such
Obligor, or (IV) result in the creation or imposition of any Lien upon
any of the property of such Obligor.
(ii) No authorization by, approval of, notice to, or filing or
registration with, any Governmental Authority or any other Person, other than
those which have been obtained or made and copies of which in the case of those
involving a Governmental Authority have been delivered to the Agent, is required
for the due execution, delivery, recordation, filing or performance by either
Obligor of this Agreement or any other Loan Document to which it is or is to be
a party, or for the consummation of the transactions contemplated hereby.
(iii) This Agreement has been and each of the other Loan
Documents to which it is a party will have been upon delivery thereof, duly
executed and delivered by each Obligor. This Agreement is, and each other Loan
Document to which it is a party will be when delivered, the legal, valid and
binding obligation of each Obligor, enforceable against it in accordance with
its terms subject to applicable bankruptcy, insolvency, moratorium or
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similar laws affecting creditors' rights generally and subject to general
principles of equity regardless of whether enforcement is sought in a proceeding
in equity or at law.
SECTION 8. AMENDMENTS, ETC. No amendment or waiver of any
provision of this Agreement nor consent to any departure by any Obligor herefrom
shall in any event be effective unless the same shall be in writing, approved by
the Majority Lenders and signed by the Agent, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.
SECTION 9. ADDRESSES FOR NOTICES. All notices and other
communications provided for hereunder shall be in writing (including
telegraphic, telex, telecopy or cable communication) and mailed, telegraphed,
telexed, telecopied, cabled or delivered by hand, if to either Obligor,
addressed to it at the address of such Obligor specified on the signature pages
hereof, if to any Lender Party, addressed to it at the address specified in the
Credit Agreement, or, as to each party, at such other address as shall be
designated by such party in a written notice to each other party complying as to
delivery with the terms of this Section. All such notices and other
communications shall, when mailed, telegraphed, telexed, telecopied, cabled or
delivered, be effective when deposited in the mails, delivered to the telegraph
company, confirmed by telex answerback, telecopied with confirmation of receipt,
delivered to the cable company or delivered by hand to the addressee or its
agent, respectively.
SECTION 10. NO WAIVER; REMEDIES. (a) No failure on the part of
any Lender Party to exercise, and no delay in exercising, any right hereunder
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right hereunder preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law or any of the other Loan Documents.
(b) Failure by any of the Lender Parties at any time or times
hereafter to require strict performance by the Borrower, the Obligors or any
other Person of any of the provisions, warranties, terms or conditions contained
in any of the Loan Documents now or at any time or times hereafter executed by
the Borrower, the Obligors or such other Person and delivered to any of the
Lender Parties shall not waive, affect or diminish any right of any of the
Lender Parties at any time or times hereafter to demand strict performance
thereof, and such right shall not be deemed to have been modified or waived by
any course of conduct or knowledge of any of the Lender Parties or any agent,
officer, employee of any of the Lender Parties.
(c) No waiver by the Lender Parties of any default shall
operate as a waiver of any other default or the same default on a future
occasion, and no action by any of the Lender Parties permitted hereunder shall
in any way affect or impair any of the rights of the Lender Parties or the
obligations of the Obligors under this Agreement or under any of the other Loan
Documents. Any determination by a court of competent jurisdiction of the
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amount of any principal and/or interest or other amount constituting any of the
Obligations shall be conclusive and binding on the Obligors irrespective of
whether either Obligor was a party to the suit or action in which such
determination was made, as long as the Borrower was a party to such suit or
action.
SECTION 11. RIGHT OF SET-OFF. Upon the occurrence and during
the continuance of any Event of Default, each Lender Party and each of its
respective Affiliates is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by such Lender Party or such Affiliate to
or for the credit or the account of either Obligor against any and all of the
obligations of such Obligor to make Keepwell Payments now or hereafter existing
irrespective of whether or not such Lender Party shall have made any demand
under this Agreement or any other Loan Document and although such obligations
may be unmatured. Each Lender Party agrees promptly to notify the Obligors after
any such set-off and application made by such Lender Party or its Affiliate;
PROVIDED, HOWEVER, that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of each Lender Party and
its respective Affiliates under this Section are in addition to the other rights
and remedies (including, without limitation, other rights of set-off) which such
Lender Party and its respective Affiliates may have.
SECTION 12. CONTINUING AGREEMENT; TRANSFER OF LOANS. This
Agreement is a continuing guaranty and shall (i) remain in full force and effect
(a) with respect to WHX until the earlier of (1) the occurrence of the Holdings
IPO Threshold and (2) the later of (x) the indefeasible payment in full of the
Obligations and (y) the Termination Date and (b) with respect to Holdings until
the later of (1) the indefeasible payment in full of the Obligations and (2) the
Termination Date, (ii) be binding upon both Obligors, their successors and
assigns, and (iii) inure to the benefit of and be enforceable by the Lender
Parties and their respective successors, transferees, and assigns. Without
limiting the generality of the foregoing clause (iii), any of the Lender Parties
may assign or otherwise transfer any Loans held by it or Obligations owing to it
to any other Person to the extent provided in the Credit Agreement, and such
other Person shall thereupon become vested with all the rights in respect
thereof granted to such Lender Party herein or otherwise with respect to such of
the Loans and Obligations so transferred or assigned, subject, however, to
compliance with the provisions of Section 10.7 of the Credit Agreement in
respect of assignments.
SECTION 13. REINSTATEMENT. This Agreement shall remain in full
force and effect and continue to be effective should any petition be filed by or
against any Loan Party for liquidation or reorganization, should any Loan Party
become insolvent or make an assignment for the benefit of creditors or should a
receiver or trustee be appointed for all or any significant part of any Loan
Party's assets, and shall, to the fullest extent permitted by law, continue to
be effective or be reinstated, as the case may be, if at any time payment and
performance of the Obligations, or any part thereof, is, pursuant to applicable
law, rescinded or reduced in amount, or must otherwise be restored or returned
by any obligee of the
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Obligations or such part thereof, whether as a "voidable preference",
"fraudulent transfer", or otherwise, all as though such payment or performance
had not been made. In the event that any payment, or any part thereof, is
rescinded, reduced, restored or returned, the Obligations shall, to the fullest
extent permitted by law, be reinstated and deemed reduced only by such amount
paid and not so rescinded, reduced, restored or returned.
SECTION 14. GOVERNING LAW; SEVERABILITY. This Agreement shall
be governed by, and construed and interpreted in accordance with, the law of the
State of New York. Wherever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited by or invalid under
applicable law, such provision shall be ineffective only to the extent of such
prohibition or invalidity and without invalidating the remaining provisions of
this Agreement.
SECTION 15. SUBMISSION TO JURISDICTION. (a) Any legal action
or proceeding with respect to this Agreement or any document related thereto may
be brought in the courts of the State of New York or of the United States of
America for the Southern District of New York, and, by execution and delivery of
this Agreement, each Obligor hereby accepts for itself and in respect of its
property, generally and unconditionally, the jurisdiction of the aforesaid
courts. The parties hereto hereby irrevocably waive any objection, including,
without limitation, any objection to the laying of venue or based on the grounds
of FORUM NON CONVENIENS, which any of them may now or hereafter have to the
bringing of any such action or proceeding in such respective jurisdictions.
(b) Each Obligor irrevocably consents to the service of
process of any of the aforesaid courts in any such action or proceeding by the
mailing of a copy thereof by registered or certified mail, postage prepaid, to
such Obligor at its address provided herein.
(c) Nothing contained in this Section 15 shall affect the
right of the Agent or any Lender Party or any holder of a Revolving Credit Note
to serve process in any other manner permitted by law or commence legal
proceedings or otherwise proceed against any Obligor in any other jurisdiction.
SECTION 16. THIRD PARTY BENEFICIARY. This Agreement is
intended for the benefit of the Agent, the Issuers and the Lenders and their
respective successors and assigns and they shall be able to enforce any and all
rights and remedies under this Agreement.
SECTION 17. SECTION TITLES. The Section titles contained in
this Agreement are and shall be without substantive meaning or content of any
kind whatsoever and are not a part of this Agreement.
SECTION 18. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each
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of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same Agreement.
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SECTION 19. MISCELLANEOUS. All references herein to the
Borrower or to an Obligor shall include their respective successors and assigns,
including, without limitation, a receiver, trustee or debtor-in-possession of or
for the Borrower or such Obligor. All references to the singular shall be deemed
to include the plural where the context so requires.
SECTION 20. WAIVER OF JURY TRIAL. Each of the Obligors and the
Borrower irrevocably waives all right to trial by jury in any action, proceeding
or counterclaim (whether based on contract, tort or otherwise) arising out of or
relating to this Agreement, another Loan Document or the actions of the Agent or
any Lender Party in the negotiation, administration, performance or enforcement
thereof.
IN WITNESS WHEREOF, the Borrower and the Obligors have caused
this Agreement to be duly executed and delivered by its duly authorized officer
on the date first above written.
WHEELING- PITTSBURGH
STEEL CORPORATION
By:_________________________
Title: Vice President
Address: 0000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxx 00000
WHEELING-PITTSBURGH
CORPORATION
By:_________________________
Title: Vice President and Special Counsel
Address: 0000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxx 00000
WHX CORPORATION
By:_________________________
Title: Vice President and Special Counsel
Address: 000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
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EXHIBIT M
FORM OF KEEPWELL AGREEMENT
KEEPWELL AGREEMENT (this "AGREEMENT"), dated December 28,
1995, made by Wheeling-Pittsburgh Steel Corporation, a Delaware corporation (the
"BORROWER"), Wheeling-Pittsburgh Corporation, a Delaware corporation
("HOLDINGS"), and WHX Corporation, a Delaware corporation ("WHX" and, together
with Holdings, the "OBLIGORS"), in favor of the Lender Parties referred to
below.
PRELIMINARY STATEMENTS:
1. The Borrower has entered into a Second Amended and Restated
Credit Agreement, dated as of December 28, 1995, with the financial institutions
party thereto and Citibank, N.A., as agent for said financial institutions (said
Agreement, as it may be amended or otherwise modified from time to time, being
the "CREDIT AGREEMENT").
2. Holdings owns beneficially and of record 100% of the
capital stock of the Borrower and WHX owns beneficially and of record 100% of
the capital stock of Holdings.
3. WHX and Holdings have agreed to provide certain assurances
to the Lender Parties with respect to the financial condition of the Borrower.
4. It is a condition precedent to the effectiveness of the
Credit Agreement and to the making of Loans and the issuance of Letters of
Credit that the Obligors shall have executed and delivered this Agreement.
NOW, THEREFORE, in consideration of the premises and to induce
the Lenders to make Loans and the Issuers to issue Letters of Credit, the
Obligors hereby agree as follows:
SECTION 1. CAPITALIZED TERMS. Capitalized terms used herein
and not otherwise defined herein, have the meanings specified in the Credit
Agreement. As used in this Agreement, the following terms shall mean:
"BANKRUPTCY CODE" means Title 11 of the United States Code,
any successor statute thereto or any similar United States federal or state law
for the relief of debtors.
"KEEPWELL PAYMENTS" has the meaning specified in Section 2.
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