<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For quarter ended September 30, 1995 Commission File No. 1-4368
THE LTV CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 75-1070950
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
25 West Prospect Avenue 44115
Cleveland, Ohio (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code: (216)622-5000
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter periods that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
------ ------
Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the latest practicable date.
104,981,796 shares of common stock
(as of October 24, 1995)
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<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
THE LTV CORPORATION
CONSOLIDATED STATEMENT OF INCOME
(in millions, except per share data)
(Unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
---------------------------- ----------------------------
1995 1994 1995 1994
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
SALES $ 1,040.2 $ 1,051.7 $ 3,238.3 $ 3,102.9
COSTS AND EXPENSES:
Cost of products sold 889.8 907.2 2,722.1 2,686.8
Depreciation and amortization 62.6 58.6 189.4 182.8
Selling, general and administrative 33.3 34.0 102.5 101.5
Net interest and other income (15.7) (3.4) (33.2) (4.8)
--------- --------- --------- ---------
Total 970.0 996.4 2,980.8 2,966.3
--------- --------- --------- ---------
INCOME BEFORE INCOME TAXES AND
DISCONTINUED OPERATIONS 70.2 55.3 257.5 136.6
Income tax provision:
Taxes payable (refundable) 0.8 0.7 1.9 (2.1)
Taxes not payable in cash 26.2 20.5 96.9 49.8
--------- --------- --------- ---------
Total 27.0 21.2 98.8 47.7
--------- --------- --------- ---------
INCOME FROM CONTINUING OPERATIONS 43.2 34.1 158.7 88.9
Discontinued operations - - (8.7) (2.0)
--------- --------- --------- ---------
NET INCOME $ 43.2 $ 34.1 $ 150.0 $ 86.9
========= ========= ========= =========
EARNINGS (LOSS) PER SHARE
Primary:
Continuing operations $ 0.40 $ 0.35 $ 1.46 $ 0.93
Discontinued operations - - (0.08) (0.02)
--------- --------- --------- ---------
Net income $ 0.40 $ 0.35 $ 1.38 $ 0.91
========= ========= ========= =========
Fully diluted:
Continuing operations $ 0.39 $ 0.35 $ 1.44 $ 0.92
Discontinued operations - - (0.08) (0.02)
--------- --------- --------- ---------
Net income $ 0.39 $ 0.35 $ 1.36 $ 0.90
========= ========= ========= =========
- -------------
See notes to consolidated financial statements.
</TABLE>
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<TABLE>
THE LTV CORPORATION
CONSOLIDATED BALANCE SHEET
(in millions, except share data)
<CAPTION>
September 30, December 31,
1995 1994
------------- -------------
ASSETS (Unaudited)
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 266.6 $ 335.4
Marketable securities 644.3 357.5
---------- -----------
910.9 692.9
Receivables, less allowance for doubtful accounts 440.4 464.5
Inventories:
Products 539.9 512.6
Materials, purchased parts and supplies 234.1 239.0
---------- -----------
Total inventories 774.0 751.6
Prepaid expenses, deposits and other 15.2 118.5
---------- -----------
Total current assets 2,140.5 2,027.5
---------- -----------
INVESTMENTS AND OTHER NONCURRENT ASSETS 313.6 308.6
PROPERTY, PLANT AND EQUIPMENT 3,609.4 3,485.0
Allowance for depreciation (469.1) (296.0)
---------- -----------
Total property, plant and equipment 3,140.3 3,189.0
---------- -----------
$ 5,594.4 $ 5,525.1
========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 288.1 $ 267.2
Accrued employee compensation and benefits 571.3 394.0
Other accrued liabilities 184.8 175.9
---------- -----------
Total current liabilities 1,044.2 837.1
---------- -----------
NONCURRENT LIABILITIES
Long-term debt 149.4 183.1
Postemployment health care and other insurance benefits 1,620.9 1,633.4
Pension benefits 856.7 1,138.7
Other 423.7 450.0
---------- -----------
Total noncurrent liabilities 3,050.7 3,405.2
---------- -----------
SHAREHOLDERS' EQUITY
Convertible preferred stock (stated value $50.0 million) 0.5 0.5
Common stock (par value $0.50 per share) 53.0 53.0
Additional paid-in capital 938.8 872.8
Retained earnings 515.0 366.7
Minimum pension liability adjustment (5.8) (5.8)
Other (2.0) (4.4)
---------- -----------
Total shareholders' equity 1,499.5 1,282.8
---------- -----------
$ 5,594.4 $ 5,525.1
========== ===========
- -------------
See notes to consolidated financial statements.
</TABLE>
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<TABLE>
THE LTV CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(in millions)
(Unaudited)
<CAPTION>
Nine Months Ended
September 30,
------------------------------------
1995 1994
------------ -------------
<S> <C> <C>
OPERATING ACTIVITIES
Income from continuing operations $ 158.7 $ 88.9
Adjustments to reconcile income from continuing operations
to net cash provided by operating activities:
Proceeds from antitrust litigation - 171.0
Depreciation and amortization 189.4 182.8
Income tax provision not payable in cash 96.9 49.8
Defined benefit pension expense 91.1 93.0
Postemployment benefit payments less than related expense 6.5 10.5
Contribution to a VEBA Trust (19.1) -
Changes in assets and liabilities 45.7 (53.6)
Other (6.0) (16.2)
------------ -------------
Net cash provided by operating activities 563.2 526.2
------------ -------------
INVESTING ACTIVITIES
Capital expenditures (141.7) (142.6)
Investment in Trico Steel (59.4) -
Net purchases of marketable securities (286.8) (356.2)
Proceeds from dispositions of discontinued operations
and other properties 93.9 13.2
Other (4.0) (10.1)
------------ -------------
Net cash used in investing activities (398.0) (495.7)
------------ -------------
FINANCING ACTIVITIES
Pension funding to restored plans (192.8) (479.1)
Payments on long-term debt (38.6) -
Issuance of Common Stock - 257.2
Preferred dividends paid (1.7) (1.7)
Other (0.9) (1.3)
------------ -------------
Net cash used in financing activities (234.0) (224.9)
------------ -------------
Net decrease in cash and cash equivalents (68.8) (194.4)
Cash and cash equivalents at beginning of period 335.4 406.3
------------ -------------
Cash and cash equivalents at end of period $ 266.6 $ 211.9
============ =============
- ----------
See notes to consolidated financial statements.
</TABLE>
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THE LTV CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1995
NOTE (1) - The accompanying unaudited consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and disclosures required by generally accepted accounting
principles for complete financial statements. All adjustments which are, in
the opinion of management, necessary for a fair presentation have been made and
are of a recurring nature unless otherwise disclosed herein. Certain prior
period amounts have been reclassified to conform with the current period
presentation. The results of operations for the interim periods are not
necessarily indicative of results of operations for a full year. For further
information, refer to the consolidated financial statements and the notes
thereto for the year ended December 31, 1994 included in the LTV Annual Report
to Shareholders incorporated by reference into the 1994 Annual Report on Form
10-K filed with the Securities and Exchange Commission.
NOTE (2) - On August 1, 1995, LTV completed the sale of its energy products
segment, Continental Emsco Company ("Continental Emsco") for $77.0 million.
$38.6 million of the proceeds was used to reduce LTV's long-term debt in the
third quarter of 1995. The loss on the sale of the segment was recorded in the
second quarter of 1995, and Continental Emsco is reflected as a discontinued
operation in LTV's financial statements for all periods presented. The
applicable net assets held for sale at December 31, 1994 are included in
current prepaid expenses, deposits and other assets, and the results of
operations of Continental Emsco are included in the results from discontinued
operations. Net assets held for sale, which consist principally of
receivables, inventories and property, plant and equipment, less current
liabilities, postemployment health care liabilities and other liabilities,
totaled $85.2 million at December 31, 1994.
The results from discontinued operations for the first nine months of 1995
included income from the energy products segment operations of $1.3 million,
which is net of income tax expense of $1.1 million. Also, the results from
discontinued operations for the 1995 nine-month period included the loss on the
sale of the business of $10.0 million, which is net of income tax benefits of
$6.0 million. The results from discontinued operations for the first nine
months of 1994 included a loss from the energy products segment operations of
$2.0 million, which is net of income tax benefits of $1.0 million. The energy
products segment had break-even results for the third quarter of 1994. Sales
by the energy products segment were $179.2 million through the date of its sale
in 1995 and $79.5 million and $223.4 million for the three-month and nine-month
periods ended September 30, 1994, respectively.
NOTE (3) - The Company's income tax provision from continuing operations was
$98.8 million in the first nine months of 1995 compared with $47.7 million in
1994. Included in the 1995 and 1994 first nine months' income tax provisions
are federal and state income tax expense amounts of $96.9 million and $49.8
million, respectively, which do not result in cash payments. Such amounts were
reflected as reductions to the Company's intangible asset, which was reduced to
zero in the first quarter of 1995, and subsequent amounts totaling $66.0
million were reported as increases to the additional paid-in capital account of
shareholders' equity. As benefits of the Company's pre-reorganization net
deferred tax assets are realized, the Company's actual income tax cash payments
will continue to be less than the financial statement income tax expense
amount.
NOTE (4) - The primary earnings per share calculations for the third quarter
and first nine months of 1995 were both based on average common and common
equivalent shares outstanding of 108.3 million. Common equivalent shares
primarily included Common Stock that is issuable in exchange for the Series B
Preferred Stock. The fully diluted earnings per share calculations for the
third quarter and first nine months of 1995 were both based on average fully
diluted shares outstanding of 113.4 million. Fully diluted shares were
determined by increasing the primary shares outstanding to reflect the Common
Stock issuable upon conversion of the convertible notes.
The primary earnings per share calculations for the third quarter and first
nine months of 1994 were based on average common and common equivalent shares
outstanding of 96.2 million and 95.1 million, respectively. The fully diluted
earnings per share calculations for the third quarter and first nine months of
1994 were based on fully diluted shares outstanding of 101.8 million and 101.1
million, respectively.
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NOTE (5) - Supplemental cash flow information is presented as follows (in
millions):
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
--------------------------------------
1995 1994
------------ -------------
<S> <C> <C>
Interest payments $ 6.3 $ 10.8
Income tax payments 0.9 0.3
Capitalized interest 6.0 4.4
</TABLE>
Purchases of marketable securities totaled $4,169.4 million, and sales and
maturities of marketable securities totaled $3,884.2 million during the nine
months ended September 30, 1995. Purchases of marketable securities totaled
$1,416.2 million, and sales and maturities of marketable securities totaled
$1,059.5 million during the nine months ended September 30, 1994.
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<PAGE> 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
RESULTS OF OPERATIONS - COMPARISON OF THIRD QUARTER AND FIRST NINE MONTHS 1995
AND 1994
Sales
- -----
Sales of $1.04 billion in the third quarter of 1995 decreased by $12 million
(1%) from the third quarter of 1994. Third quarter 1995 steel shipments of 2.0
million tons increased by 22,000 tons (1%) from the third quarter of 1994. The
1995 third quarter mix of products sold reflected increased shipments of lower
priced hot rolled steel to the export market.
Sales of $3.24 billion in the first nine months of 1995 increased by $135
million (4%) from the first nine months of 1994. Steel shipments of 6.0
million tons in the first nine months increased by 88,000 tons (2%) from the
first nine months of 1994. The increases in sales and shipments during the
first nine months of 1995 reflect higher average selling prices and increased
export shipments.
Hot and cold flat rolled product sales of $537.0 million were 1% higher in
the third quarter of 1995 versus the third quarter of 1994, reflecting a 6%
increase in shipments partially offset by a decrease in average selling prices
due to the mix of products sold. Galvanized product sales of $278.0 million
were 4% lower in the third quarter of 1995 versus the third quarter of 1994,
reflecting a 9% decrease in shipments partially offset by an increase in
average selling prices. Tin mill product sales of $106.4 million were 5% lower
in the third quarter of 1995, reflecting a 6% decrease in shipments partially
offset by an increase in average selling prices. Tubular product sales of
$77.4 million, consisting primarily of electrical conduit, electric weld pipe
and welded tubing, were 1% higher in the third quarter of 1995, reflecting a 3%
decrease in shipments offset by an increase in average selling prices.
Hot and cold flat rolled product sales of $1,642.7 million were 6% higher in
the first nine months of 1995 versus the first nine months of 1994, reflecting
a 4% increase in shipments and an increase in average selling prices.
Galvanized product sales of $929.0 million were 5% higher in the first nine
months of 1995 versus the first nine months of 1994, reflecting a 3% decrease
in shipments that was more than offset by an increase in average selling
prices. Tin mill product sales of $316.0 million were 3% lower in the first
nine months of 1995, reflecting a 7% decrease in shipments partially offset by
an increase in average selling prices. Tubular product sales of $242.5 million
were 11% higher in the first nine months of 1995, reflecting a 6% increase in
shipments and an increase in average selling prices.
Nonsteel sales in the third quarter of 1995 of $41.3 million were $1.8
million less than in the third quarter of 1994. Nonsteel sales in the first
nine months of 1995 of $108.1 million were $6.6 million less than the first
nine months of 1994. The decreases in both periods were principally due to
lower outside sales of iron ore.
Production and Costs
- --------------------
Raw steel production of 2.1 million tons in the third quarter of 1995
increased by 79,000 tons (4%) compared with the third quarter of 1994. The
average operating rate at the Company's steelmaking facilities during the third
quarter of 1995 was 101% compared with 97% in 1994. During July 1995, the
Company began a routine scheduled repair outage of a blast furnace at the
Cleveland Works, which was completed in less than four weeks.
Raw steel production of 6.3 million tons in the first nine months of 1995
increased by 171,000 tons (3%) compared with the first nine months of 1994.
The average operating rate at the Company's steelmaking facilities during the
first nine months of 1995 was 102% compared with 99% in 1994. Production and
costs in the 1994 first quarter were negatively impacted by the extremely cold
weather conditions at the operating units.
Cost of products sold as a percentage of sales decreased from 86.3% in the
third quarter of 1994 to 85.5% in the third quarter of 1995. Cost of products
sold as a percentage of sales decreased from 86.6% in the first nine months of
1994 to 84.1% in the first nine months of 1995. These improvements were
primarily due to higher average selling prices and increased shipments
resulting from new marketing initiatives. The results from the first nine
months of 1995 were also favorably impacted by productivity and operating
performance improvements, including those achieved through the Cleveland Works'
continuous steel casting and rolling complex which
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<PAGE> 8
became fully operational in the second quarter of 1994. However, these
benefits were partially offset by additional costs related to the June 1994
labor agreement with the United Steelworkers of America ("USWA").
During the 1995 third quarter, the Company incurred costs of approximately
$7 million related to the blast furnace repair outage at the Cleveland Works.
The Company also incurred one-time transitional costs of $5 million related to
the outsourcing of its information systems and data processing functions in the
third quarter of 1995. These costs were fully offset by a $7 million gain on
the recovery of escrow balances related to a property disposition and a $5
million benefit due primarily to favorable postemployment health care cost
experience.
Net Interest and Other Income
- -----------------------------
Net interest and other income of $15.7 million in the third quarter of 1995
increased by $12.3 million from the third quarter of 1994, and net interest and
other income of $33.2 million in the first nine months of 1995 increased by
$28.4 million from the first nine months of 1994. The improvements were
primarily due to increased interest income from higher invested cash and
marketable securities' balances along with a higher earnings rate on such
balances, and lower fees on credit facilities and higher capitalized interest.
The Company also recorded a $5.8 million gain related to unclaimed bankruptcy
distributions in the third quarter of 1995.
Income Taxes
- ------------
For information regarding income taxes, see Note (3) to the consolidated
financial statements.
DISCONTINUED OPERATIONS - ENERGY PRODUCTS SEGMENT
THIRD QUARTER AND NINE MONTHS 1995 COMPARED WITH THIRD QUARTER AND NINE MONTHS
1994
On August 1, 1995, LTV completed the sale of its energy products segment,
Continental Emsco Company ("Continental Emsco") for $77.0 million. $38.6
million of the proceeds was used to reduce LTV's long-term debt in the third
quarter of 1995. The loss on the sale of the segment was recorded in the
second quarter of 1995, and Continental Emsco is reflected as a discontinued
operation in LTV's financial statements for all periods presented. The
applicable net assets held for sale at December 31, 1994 are included in
current prepaid expenses, deposits and other assets, and the results of
operations of Continental Emsco are included in the results from discontinued
operations. Net assets held for sale, which consist principally of
receivables, inventories and property, plant and equipment, less current
liabilities, postemployment health care liabilities and other liabilities,
totaled $85.2 million at December 31, 1994.
The results from discontinued operations for the first nine months of 1995
included income from the energy products segment operations of $1.3 million,
which is net of income tax expense of $1.1 million. Also, the results from
discontinued operations for the 1995 nine-month period included the loss on the
sale of the business of $10.0 million, which is net of income tax benefits of
$6.0 million. The results from discontinued operations for the first nine
months of 1994 included a loss from the energy products segment operations of
$2.0 million, which is net of income tax benefits of $1.0 million. The energy
products segment had break-even results for the third quarter of 1994. Sales
by the energy products segment were $179.2 million through its sales date and
$79.5 million and $223.4 million for the three-month and nine-month periods
ended September 30, 1994, respectively. The improvement in results during the
first nine months of 1995 (excluding the loss on sale) was due to higher margin
sales and lower selling, general and administrative expenses.
LIQUIDITY AND CAPITAL RESOURCES
The Company's sources of liquidity include cash and cash equivalents,
marketable securities, cash from operations, amounts available under credit
facilities and other external sources of funds. Management believes that these
sources are sufficient to fund the current requirements of working capital,
capital expenditures, investments in a joint venture, pensions and
postemployment health care.
During the first nine months of 1995, cash provided by operating activities
amounted to $563.2 million. The other major source of cash during 1995
consisted of $93.9 million in proceeds from the dispositions of Continental
Emsco and other properties. Major uses of cash during the first nine months of
1995 included contributions to the Company's restored pension plans of $192.8
million, capital expenditures of $141.7 million, investments in Trico Steel
Company of $59.4 million and payments on long-term debt of $38.6 million.
Since
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<PAGE> 9
December 31, 1994, total cash, cash equivalents and marketable securities have
increased by $218.0 million to $910.9 million at September 30, 1995.
The Company's receivables credit facility permits borrowings of up to $320
million for working capital requirements and general corporate purposes, $100
million of which may be used to issue letters of credit. At September 30,
1995, $308 million was permitted to be borrowed, no borrowings were outstanding
and letters of credit outstanding amounted to $25.8 million under this
facility. The Company's letter of credit facility is a separate credit
facility that provides for the issuance of up to $150 million in letters of
credit. At September 30, 1995, letters of credit totaling $85.8 million were
outstanding under this facility.
The Company's long-term debt and credit facilities' agreements contain
various covenants which require the Company to maintain certain financial
ratios and amounts. These agreements, as well as the Company's agreement with
the Pension Benefit Guaranty Corporation (the "PBGC Agreement"), place certain
restrictions on payments of dividends, capital expenditures, investments in
subsidiaries and borrowings. The PBGC Agreement also requires that a
significant portion of the Company's annual cash flow be contributed to the
Company's pension plans. Under the terms of the most restrictive debt
covenant, approximately $90 million of retained earnings are available for
Common Stock dividend payments at September 30, 1995. Substantially all of the
Company's receivables and inventories are pledged as collateral under these
debt agreements. The Company does not believe that the restrictions contained
in these financial and operating covenants will cause significant limitations
on the Company's financial flexibility.
A 1993 agreement with the USWA provided that a portion of the requirements
with respect to certain postemployment benefits would be secured by a junior
lien of $250 million on collateral with an unencumbered fair market value of at
least $500 million. The initial security was provided by the grant of a
mortgage on facilities having a carrying value of approximately $500 million.
LTV competes directly with domestic and foreign integrated flat rolled
carbon steel producers and indirectly with producers of plastics, aluminum and
other materials such as ceramics and wood which sometimes can be substituted
for flat rolled carbon steel in manufacturing and construction. LTV also
competes with minimills which are relatively efficient, low-cost producers that
generally produce steel from scrap in electric furnaces. Their participation
in steel markets has traditionally been limited to structural, plate, bar and
rod products. Recently developed thin slab casting technologies have allowed
minimills to enter certain flat rolled markets which have traditionally been
supplied by integrated producers. Certain companies, including Trico Steel
Company, L.L.C. ("Trico"), a 50% LTV-owned venture with Sumitomo Metal
Industries, Ltd. and British Steel plc, have begun construction of, announced
plans for, or have indicated that they are evaluating whether to construct
additional minimills to produce flat rolled products. LTV will continue to
require substantial funds in future years to maintain and improve its steel
operations in order to compete with steel substitutes, minimills and other
fully integrated steelmakers. Capital expenditures for the nine months ended
September 30, 1995 totaled $141.7 million and for the full year are estimated
to total $230 million. LTV's investment in Trico for the nine months ended
September 30, 1995 totaled $59.4 million and for the full year is estimated to
total $100 million.
ENVIRONMENTAL LIABILITIES AND RELATED COSTS
LTV is subject to changing and increasingly stringent environmental
standards and laws concerning air emissions, water discharges and waste
disposal in the normal course of conducting its business. The Company spent
$13.4 million during the first nine months of 1995 for environmental clean-up
and related matters at operating and idled facilities, and at September 30,
1995, has a recorded liability of $101.0 million for known and identifiable
environmental and related matters. The Company also spent $14.7 million in the
first nine months of 1995 for environmental compliance-related capital
expenditures (which is included in the total capitol expenditures noted
previously) and expects it will be required to spend an average of
approximately $30 million annually in capital expenditures during the next five
years to meet environmental standards.
Estimates for future costs required for environmental compliance are
difficult to determine due to numerous uncertainties, including the evolving
nature of the regulations, the possible imposition of more stringent
requirements and the availability of new technologies. If any of the Company's
facilities are unable to meet required environmental standards, those
operations could be temporarily or permanently closed. The effect of the
outcome of these matters on the Company's future results of operations and
liquidity cannot be predicted because any such effect depends on future results
of operations and the amount and timing of the resolution of such matters.
While it is not possible to predict with certainty, management believes that
the ultimate resolution of such matters will not have a material adverse effect
on the consolidated financial position of the Company.
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<PAGE> 10
OTHER MATTERS
The Company is continuing a comprehensive review relating to the redesign of
its business processes to strengthen customer service, increase productivity
and reduce costs. In early October 1995, LTV announced a reorganization and
centralization of certain sales and marketing functions. Costs associated with
this reorganization are expected to approximate $6 million and will be
recognized in the 1995 fourth quarter results. LTV expects that its
multi-faceted business processes review will identify additional processes
which can be improved to enhance customer service and increase productivity,
and that the resulting process redesigns will lead to a reduction in costs.
Currently, LTV is unable to determine the amount and timing of potential future
cost savings or other charges related to the effects of these various efforts.
In October 1995, the United States Supreme Court let stand a federal appeals
court ruling that LTV could be held liable for the requirements under the Coal
Industry Retiree Health Benefit Act of 1992. This ruling has no impact on
current results of operations as the Company fully reserved $140 million for
this matter in 1992.
A second previously planned repair outage of a blast furnace began at the
Cleveland Works on October 6, 1995 and should take less than four weeks to
complete. The remainder of LTV's raw steel facilities are expected to operate
at capacity during the fourth quarter of 1995.
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<PAGE> 11
PART II
ITEM 1. LEGAL PROCEEDINGS.
In September 1995, Georgia Tubing Corporation, a wholly owned subsidiary
of the Company, was notified by the Georgia Department of Environmental
Protection that it will seek an unspecified civil penalty (which is not
expected to be material in amount) due to a delay in the installation of
equipment for controlling the emissions of volatile organic compounds from
coating lines at the subsidiary's plant.
Also in September 1995, the U.S. Bankruptcy Court for the Southern
District of New York ruled in favor of the Company to the effect that Thomson
CSF, S.A. ("Thomson") had breached its promise to pay the Company $20 million
as a result of Thomson's inability to complete the purchase of the Company's
missiles division by July 31, 1992 in the litigation described under "Thomson
Litigation" in Item 3 of the Company's Report on Form 10-K for 1994. Such
court also ruled the Company had not breached the contract with Thomson by
failing to use "reasonable efforts" to assist Thomson in obtaining the
necessary government approvals. Thomson has appealed the rulings to the U.S.
District Court for the Southern District of New York and provided security for
the monetary judgment, including allowed interest, pending the appeal. In
connection with the Company's 1993 Joint Plan of Reorganization, LTV agreed to
contribute to the aerospace creditor trust up to $10 million from the net
proceeds received from this litigation plus half of the allowed interest, and
to make up any shortfall at the conclusion of the litigation if the amount
received is less than $10 million.
In October 1995, the Company and McDonnell Douglas Corporation agreed to
settle the contract litigation described under "McDonnell Douglas Litigation"
in Item 3 of the Company's Report on Form 10-K for 1994. The settlement, which
must be approved by the U.S. District Court for the Northern District of Texas,
provides for the Company and McDonnell Douglas each to contribute $8.25 million
to the above-mentioned aerospace creditor trust.
ITEM 5. OTHER INFORMATION
REQUIRED APPROVAL FOR CERTAIN PURCHASES OF
COMMON STOCK AND SERIES A WARRANTS
For the purpose of preserving LTV's ability to utilize certain favorable
tax attributes, Article Ninth of LTV's Restated Certificate of Incorporation
prohibits, with certain limited exceptions, any unapproved acquisition of
Common Stock or Series A Warrants that would cause the ownership interest
percentage of the acquirer or any other person to increase to 4.5% or above. A
person's ownership interest percentage for purposes of Article Ninth is
determined by reference to specified federal income tax principles, including
attribution of shares from certain related parties, deemed exercise of rights
to acquire stock (such as the Company's Series A Warrants) and aggregation of
shares purchased by persons acting in concert. PURCHASES OF COMMON STOCK OR
SERIES A WARRANTS FROM ANY PERSON OTHER THAN THE COMPANY ARE SUBJECT TO THE
LIMITATIONS IMPOSED BY ARTICLE NINTH, AND ANY UNAPPROVED PURCHASE IN EXCESS OF
THE AMOUNTS PERMITTED BY ARTICLE NINTH WILL BE VOID AB INITIO. A PROSPECTIVE
PURCHASER OF COMMON STOCK OR SERIES A WARRANTS WHO BELIEVES THAT IT MAY BE
SUBJECT TO THE LIMITATIONS IMPOSED BY ARTICLE NINTH SHOULD CONSULT WITH THEIR
ADVISORS OR LTV IN ADVANCE OF ACQUIRING SUCH SECURITIES TO DETERMINE IF ADVANCE
APPROVAL MUST BE OBTAINED FROM LTV'S BOARD OF DIRECTORS.
II-1
<PAGE> 12
ITEM 6. EXHIBITS AND REPORTS ON 8-K
(A) Exhibits
Certain of the exhibits to this Report are hereby incorporated by
reference, as specified below, to other documents filed with the Commission by
LTV. Exhibit designations below correspond to the numbers assigned to exhibit
classifications in Regulation S-K.
(10)-(1) - LTV Executive Benefit Plan as amended and
restated effective January 1, 1985
(incorporated herein by reference to
Exhibit(10)(c)-(2) to LTV's Report on Form
10-K for the year ended December 31, 1985)
(10)-(2) - Amendment to LTV Executive Benefit Plan
adopted November 20, 1987 (incorporated
herein by reference to Exhibit(10)(c)-(3) to
LTV's Report on Form 10-K for the year ended
December 31, 1987)
(10)-(3) - LTV Excess Benefit Plan dated as of
January 1, 1985 (incorporated herein by
reference to Exhibit (10)(c)-(5) to LTV's
Report on Form 10-K for the year ended
December 31, 1984)
(10)-(4) - Employment Agreement dated February 1, 1991,
between LTV and David H. Hoag (incorporated
herein by reference to Exhibit (10)(c)-(9) to
LTV's Report on Form 10-K for the year ended
December 31, 1990)
(10)-(5) - Settlement Agreement dated as of June 28,
1993 between LTV, the PBGC, the Initial LTV
Group (as defined in the Settlement
Agreement) and LTV, as Administrator of the
Restored Plans (incorporated herein by
reference to Exhibit 10.10 to LTV's Report on
Form 10-Q for the quarter ended June 30,
1993)
(10)-(6) - Assignment, Pledge and Security Agreement
dated as of June 28, 1993 between LTV Steel
Company, Inc. and the PBGC (incorporated
herein by reference to Exhibit 10.11 to LTV's
Report on Form 10-Q for the quarter ended
June 30, 1993)
(10)-(7) - Securities Purchase Agreement dated as of
May 26, 1993 by and among LTV, LTV Steel
Company, Inc. and SMI America, Inc.
(incorporated herein by reference to
Exhibit 2 to SMI America, Inc.'s 13D Filing)
(10)-(8) - Common Stock Registration Rights Agreement
dated as of June 28, 1993 by and between LTV
and SMI America, Inc. (incorporated herein
by reference to Exhibit 5 to SMI America,
Inc.'s 13D Filing)
(10)-(9) - Consultation and Management Participation
Agreement dated as of June 28, 1993 between
LTV and Sumitomo Metal Industries, Ltd.
II-2
<PAGE> 13
(incorporated herein by reference to
Exhibit 6 to SMI America, Inc.'s 13D Filing)
(10)-(10) - L-S Exchange Right and Security Agreement
dated as of June 28, 1993 by and among
LTV/EGL Holding Company, Sumikin EGL Corp.,
LTV, SMI America Inc., and Sumitomo Metal USA
Corporation (incorporated herein by reference
to Exhibit 7 to SMI America, Inc.'s 13D
Filing)
(10)-(11) - Letter of Credit Agreement dated as of
October 12, 1994 among LTV Steel Company,
Inc., Continental Emsco Company, LTV Steel
Mining Company, LTV Steel Tubular Products
Company, LTV, various financial institutions
and BT Commercial Corporation (incorporated
herein by reference to Exhibit (10)-(12) to
LTV's Report on Form 10-Q for the quarter
ended September 30, 1994)
(10)-(12) - Subsidiary Guaranty dated as of October 12,
1994 by Georgia Tubing Corporation,
Youngstown Erie Corporation, Erie B
Corporation and Erie I Corporation for the
benefit of BT Commercial Corporation as agent
(incorporated herein by reference to Exhibit
(10)-(13) to LTV's Report on Form 10-Q for
the quarter ended September 30, 1994)
(10)-(13) - Collateral Account Agreement dated as of
October 12, 1994 among LTV Steel Company,
Inc., Continental Emsco Company, LTV Steel
Mining Company, LTV Steel Tubular Products,
LTV and BT Commercial Corporation as
collateral agent (incorporated herein by
reference to Exhibit (10)-(14) to LTV's
Report on Form 10-Q for the quarter ended
September 30, 1994)
(10)-(14) - Inventory Security Agreement dated as of
June 28, 1993 and amended and restated as of
October 12, 1994 among LTV, LTV Steel
Company, Inc., LTV Steel Mining Company,
Continental Emsco Company, LTV Steel Tubular
Products Company and BT Commercial
Corporation as agent (incorporated herein by
reference to Exhibit (10)-(15) to LTV's
Report on Form 10-Q for the quarter ended
September 30, 1994)
(10)-(15) - Inventory Intercreditor Agreement dated as of
June 28, 1993 and amended and restated as of
October 12, 1994 among BT Commercial
Corporation as agent for the Lenders and SMI
America, Inc. as agent for the Noteholders
(incorporated herein by reference to Exhibit
(10)-(16) to LTV's Report on Form 10-Q for
the quarter ended September 30, 1994)
(10)-(16) - Intercreditor Collateral Account Agreement
dated as of October 12, 1994 by and among LTV
Steel Company, Inc., LTV and BT Commercial
Corporation (incorporated herein by reference
to Exhibit (10)-(17) to LTV's Report on Form
10-Q for the quarter ended September 30,
1994)
II-3
<PAGE> 14
(10)-(17) - Pledge Agreement dated as of October 12, 1994
between LTV, LTV Steel Company, Inc.,
Continental Emsco Company, LTV Steel Tubular
Products Company, Georgia Tubing Corporation
and BT Commercial Corporation (incorporated
herein by reference to Exhibit (10)-(18) to
LTV's Report on Form 10-Q for the quarter
ended September 30, 1994)
(10)-(18) - Amended and Restated Subordination Agreement
dated as of June 28, 1993 and amended and
restated as of October 12, 1994 among the
PBGC, BT Commercial Corporation and Chemical
Bank (incorporated herein by reference to
Exhibit (10)-(19) to LTV's Report on Form
10-Q for the quarter ended September 30,
1994)
(10)-(19) - Amendments Nos. 1 and 2 to the Securities
Purchase Agreement dated as of May 26, 1993
among LTV, LTV Steel Company, Inc. and SMI
America, Inc. (incorporated herein by
reference to Exhibit (10)-(20) to LTV's
Report on Form 10-Q for the quarter ended
September 30, 1994)
(10)-(20) - Amendments Nos. 1 through 4 to the Settlement
Agreement dated as of June 28, 1993 by and
among the PBGC, LTV, the Initial LTV Group
(as defined in the Settlement Agreement) and
LTV, as Administrator of the Restored Plans
(incorporated herein by reference to Exhibit
(10)-(21) to LTV's Report on Form 10-Q for
the quarter ended September 30, 1994)
(10)-(21) - Revolving Credit Agreement dated as of
October 12, 1994 among LTV Sales Finance
Company, the financial institutions parties
thereto as banks, the issuing banks, the
facility agent and collateral agent
(incorporated herein by reference to Exhibit
(10)-(22) to LTV's Report on Form 10-Q for
the quarter ended September 30, 1994)
(10)-(22) - Receivables Purchase and Sale Agreement dated
as of October 12, 1994 among LTV, LTV Steel
Company, Inc., Continental Emsco Company, LTV
Steel Tubular Products Company, Georgia
Tubing Corporation and LTV Sales Finance
Company (incorporated herein by reference to
Exhibit (10)-(23) to LTV's Report on Form
10-Q for the quarter ended September 30,
1994)
(10)-(23) - Accession Agreement dated as of October 12,
1994 among LTV Sales Finance Company, the
financial institutions listed on the
signature pages thereof, the issuing bank
named thereon, and Bankers Trust Company as
facility agent and collateral agent
(incorporated herein by reference to Exhibit
(10)-(24) to LTV's Report on Form 10-Q for
the quarter ended September 30, 1994)
II-4
<PAGE> 15
(10)-(24) - Trust Termination Acknowledgment and
Agreement, dated October 12, 1994, between
LTV Sales Finance Company and Wilmington
Trust Company (incorporated herein by
reference to Exhibit (10)-(25) to LTV's
Report on Form 10-Q for the quarter ended
September 30, 1994)
(10)-(25) - Assignment and Transfer Agreement, dated as
of October 12, 1994, by and between LTV
Master Receivables Trust and LTV Sales
Finance Company (incorporated herein by
reference to Exhibit (10)-(26) to LTV's
Report on Form 10-Q for the quarter ended
September 30, 1994)
(10)-(26) - Collateral Trust Agreement dated as of
May 25, 1993 among LTV, LTV Steel Company,
Inc., United Steelworkers of America and Bank
One Ohio Trust Company, NA, as Collateral
Trustee (incorporated herein by reference to
Exhibit 10.33 to LTV's Report on Form 10-Q
for the quarter ended June 30, 1993)
(10)-(27) - Open--2nd Mortgage, Security Agreement and
Fixture Filing dated as of June 28, 1993 by
LTV Steel Company, Inc. to Bank One Ohio
Trust Company, N.A. (incorporated herein by
reference to Exhibit 10.34 to LTV's Report on
Form 10-Q for the quarter ended June 30,
1993)
(10)-(28) - License Agreement dated as of June 28, 1993
between LTV Steel Company, Inc. and Bank One
Ohio Trust Company, N.A. (incorporated herein
by reference to Exhibit 10.35 to LTV's Report
on Form 10-Q for the quarter ended June 30,
1993)
(10)-(29) - Warrant Agreement dated as of June 28, 1993
between LTV and Society National Bank, as
Warrant Agent (incorporated herein by
reference to Exhibit 10.37 to LTV's Report on
Form 10-Q for the quarter ended June 30,
1993)
(10)-(30) - Settlement Agreement and Stipulated Order on
behalf of the United States of America on
behalf of the United States Environmental
Protection Agency approved by the United
States Bankruptcy Court Southern District of
New York (the "Court") on April 15, 1993 and
supplemented by Exhibit 10.38 below
(incorporated herein by reference to Exhibit
10.38 to LTV's Report on Form 10-Q for the
quarter ended June 30, 1993)
(10)-(31) - Second Settlement Agreement and Stipulated
Order supplementing 10.36 above and approved
by the Court on May 19, 1993 (incorporated by
reference to Exhibit 10.39 to LTV's
Registration Statement on Form S-1
(Registration No. 33-50217))
II-5
<PAGE> 16
(10)-(32) - Settlement Agreement and Stipulated Order on
behalf of the State of Minnesota approved by
the Court on May 19, 1993 (incorporated
herein by reference to Exhibit 10.39 to LTV's
Report on Form 10-Q for the quarter ended
June 30, 1993)
(10)-(33) - Settlement Agreement and Stipulated Order on
behalf of the State of Indiana on behalf of
the Indiana Department of Environmental
Management approved by the Court on May 24,
1993 (incorporated herein by reference to
Exhibit 10.40 to LTV's Report on Form 10-Q
for the quarter ended June 30, 1993)
(10)-(34) - Settlement Agreement and Stipulated Order on
behalf of the State of New York and approved
by the Court on May 24, 1993 (incorporated
herein by reference to Exhibit 10.42 to LTV's
Report on Form 10-Q for the quarter ended
June 30, 1993)
(10)-(35) - Settlement Agreement and Stipulated Order on
behalf of the State of Connecticut and
approved by the Court on May 19, 1993
(incorporated herein by reference to Exhibit
10.43 to LTV's Report on Form 10-Q for the
quarter ended June 30, 1993)
(10)-(36) - Settlement Agreement and Stipulated Order on
behalf of the Commonwealth of Pennsylvania
and approved by the Court on May 24, 1993
(incorporated herein by reference to Exhibit
10.44 to LTV's Report on Form 10-Q for the
quarter ended June 30, 1993)
(10)-(37) - Settlement Agreement and Stipulated Order on
behalf of the State of Ohio on behalf of the
Ohio Environmental Protection Agency and
approved by the Court on May 24, 1993
(incorporated herein by reference to Exhibit
10.45 to LTV's Report on Form 10-Q for the
quarter ended June 30, 1993)
(10)-(38) - Settlement Agreement and Stipulated Order on
behalf of the State of Georgia and approved
by the Court on May 24, 1993 (incorporated
herein by reference to Exhibit 10.46 to LTV's
Report on Form 10-Q for the quarter ended
June 30, 1993)
(10)-(39) - Closing Agreement Between LTV, its
subsidiaries and the Commissioner of Internal
Revenue as filed with the United States
Bankruptcy Court for the Southern District of
New York on May 14, 1993 (incorporated herein
by reference to Exhibit 10.47 to LTV's Report
on Form 10-Q for the quarter ended June 30,
1993)
(10)-(40) - The LTV Corporation Non-Employee Directors
Stock Option Plan adopted on October 22, 1993
(incorporated herein by reference to Exhibit
10.49 to Amendment No. 2 to LTV's
Registration Statement on Form S-1
[Registration No. 33-50217])
II-6
<PAGE> 17
(10)-(41) - Amendment to LTV Executive Benefit Plan
adopted October 22, 1993 (incorporated herein
by reference to Exhibit 10.50 to Amendment
No. 2 to LTV's Registration Statement on Form
S-1 [Registration No. 33-50217])
(10)-(42) - LTV Executive Benefit Trust Agreement
approved on October 22, 1993 (incorporated
herein by reference to Exhibit 10.51 to
Amendment No. 2 to LTV's Registration
Statement on Form S-1 [Registration No.
33-50217])
(10)-(43) - The LTV Corporation Supplemental Management
Retirement Plan adopted on October 22, 1993
(incorporated herein by reference to Exhibit
10.52 to Amendment No. 2 to LTV's
Registration Statement on Form S-1
[Registration No. 33-50217])
(10)-(44) - The LTV Corporation Supplemental Management
Retirement Trust Agreement approved on
October 22, 1993 (incorporated herein by
reference to Exhibit 10.53 to Amendment No. 2
to LTV's Registration Statement on Form S-1
[Registration No. 33-50217])
(10)-(45) - The LTV Corporation Management Incentive
Program as amended on January 28, 1994
(incorporated by reference to Exhibit
(10)-(53) to LTV's Report on Form 10-K for
the year ended December 31, 1993)
(10)-(46) - Amendment to The LTV Corporation Supplemental
Management Retirement Plan adopted on January
28, 1994 (incorporated by reference to
Exhibit (10)-(54) to LTV's Report on Form
10-K for the year ended December 31, 1993)
(10)-(47) - Amendment to LTV Executive Benefit Plan
adopted October 28, 1994 (incorporated herein
by reference to Exhibit (10)-(48) to LTV's
Report on Form 10-Q for the quarter ended
September 30, 1994)
(10)-(48) - Amendment to The LTV Corporation Management
Incentive Program adopted October 28, 1994
(incorporated herein by reference to Exhibit
(10)-(49) to LTV's Report on Form 10-Q for
the quarter ended September 30, 1994)
(10)-(49) - Amendment to The LTV Corporation Non-Employee
Directors Stock Option Plan adopted October
28, 1994 (incorporated herein by reference to
Exhibit (10)-(50) to LTV's Report on Form
10-Q for the quarter ended September 30,
1994)
(10)-(50) - Amendment to The LTV Corporation Supplemental
Management Retirement Plan adopted on October
28, 1994 (incorporated herein by reference to
Exhibit (10)-(51) to LTV's Report on Form
10-Q for the quarter ended September 30,
1994)
II-7
<PAGE> 18
(10)-(51) - The LTV Corporation Non-Employee Directors'
Equity Compensation Plan (incorporated
herein by reference to Exhibit 4.3 to LTV's
Registration Statement on Form S-8
[Registration No. 33-56857])
(10)-(52) - The LTV Corporation Non-Employee Directors'
Deferred Compensation Plan (incorporated
herein by reference to Exhibit (10)-(53) to
LTV's Report on Form 10-K for the year ended
December 31, 1994)
(10)-(53) - The LTV Corporation Executive Deferred
Compensation Plan (incorporated herein by
reference to Exhibit (10)-(54) to LTV's
Report on Form 10-K for the year ended
December 31, 1994)
(10)-(54) - Amendment No. 5 to the Settlement Agreement
dated as of June 28, 1993 by and among the
PBGC, LTV, the Initial LTV Group and LTV, as
Administrator of the Restored Plans
(incorporated herein by reference to Exhibit
(10)-(55) to LTV's Report on Form 10-K for
the year ended December 31, 1994)
(10)-(55) - The Hourly Employee Stock Payment Alternative
Plan (incorporated herein by reference to
Exhibit 4.3 to LTV's Registration Statement
on Form S-8 [Registration No. 33-56861])
(10)-(56) - Amendments Nos. 1 through 4 to the Letter of
Credit Agreement dated as of October 12, 1994
among LTV Steel Company, Inc., Continental
Emsco Company, LTV Steel Mining Company, LTV
Steel Tubular Products Company, LTV, various
financial institutions and BT Commercial
Corporation (filed herewith)
(10)-(57) - Amendment No. 1 to the Receivables Purchase
and Sale Agreement dated as of October 12,
1994 among LTV, LTV Steel Company, Inc.,
Continental Emsco Company, LTV Steel Tubular
Products Company, Georgia Tubing Corporation
and LTV Sales Finance Company (filed
herewith)
(10)-(58) - Amendments Nos. 6 and 7 to the Settlement
Agreement dated as of June 28, 1993 by and
among the PBGC, LTV, the Initial LTV Group
(as defined in the Settlement Agreement) and
LTV, as Administrator of the Restored Plans
(filed herewith)
(11) - Statement re computation of Per Share
Earnings (filed herewith)
(27) - Financial Data Schedule (filed herewith)
(b) Reports on Form 8-K.
No report on Form 8-K was filed by the registrant for the
relevant period.
II-8
<PAGE> 19
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
THE LTV CORPORATION
----------------------------------
(Registrant)
By /s/ Arthur W. Huge
-------------------------------
Arthur W. Huge
Senior Vice President
Chief Financial Officer
(Principal Financial and
Accounting Officer)
Date: October 30, 1995
--------------------------------
II-9
<PAGE> 1
EXHIBIT (10)-(56)
FIRST AMENDMENT TO LETTER OF CREDIT AGREEMENT
---------------------------------------------
FIRST AMENDMENT (the "Amendment"), dated as of May 2, 1995,
among The LTV Corporation, a Delaware corporation ("LTV"), LTV Steel Company,
Inc., a New Jersey corporation, Continental Emsco Company, a Delaware
corporation, LTV Steel Mining Company, a Minnesota limited partnership, LTV
Steel Tubular Products Company, a Delaware corporation (the "Borrowers"), the
financial institutions party to the Credit Agreement referred to below (the
"Lenders") and BT Commercial Corporation, acting as Agent (the "Agent") in the
manner and to the extent described in Article 9 of the Credit Agreement
referred to below. All capitalized terms used herein and not otherwise defined
shall have the respective meanings provided such terms in the Credit Agreement.
W I T N E S S E T H :
--------------------
WHEREAS, LTV, the Borrowers, the Lenders and the Agent are
parties to a Credit Agreement, dated as of October 12, 1994 (as amended,
modified or supplemented to the date hereof, the "Credit Agreement");
WHEREAS, the parties to the Credit Agreement wish to amend the
Credit Agreement to permit certain transactions in connection with the
participation by LTV, through one or more wholly owned Subsidiaries of LTV, in
the Trico Joint Venture (as defined below) and the distribution by Trico Sales
Co. (as defined below) of steel products manufactured by the Trico Joint
Venture;
NOW, THEREFORE, it is agreed:
1. On and after the Amendment Effective Date (as defined
below), the definition of Material Subsidiary in Section 1.1 of the Credit
Agreement is hereby amended and restated in its entirety:
"MATERIAL SUBSIDIARY shall mean any Subsidiary of LTV or any
Borrower (other than the Sumitomo Joint Ventures, the Trico
Joint Venture, the LTV Trico Member, Trico Sales Co., or any
Subsidiary which is a railroad subject to regulation by the
Interstate Commerce Commission) which has, at any time, (i)
assets (other than intercompany accounts) with a book value in
an aggregate amount equal to or greater than $10,000,000, (ii)
steel products (other than steel products located at or
galvanized by L-S Electro-Galvanizing Company or steel
products located at the Trico Joint Venture or at Trico Sales
Co.) work-in-process and raw materials inventory in an
aggregate amount equal to or greater than $5,000,000 (valued
for purposes of this definition at the higher of cost and fair
market value), or (iii) accounts receivable arising from the
sale of steel products and steel
-1-
<PAGE> 2
production raw materials (other than intercompany accounts
and accounts of any Sumitomo Joint Venture or LTV/EGL or
LTV Electro- Galvanizing Company arising form the sale of
steel products galvanized by a Sumitomo Joint Venture and other
than intercompany accounts and accounts of the Trico Joint
Venture or Trico Sales Co. arising from the sale of steel
products manufactured by the Trico Joint Venture) in a face
amount equal to or greater than $5,000,000."
2. On and after the Amendment Effective Date, the definition
of Subsidiary in Section 1.1 of the Credit Agreement is hereby amended and
restated in its entirety:
"SUBSIDIARY shall mean, with respect to any Person, any
corporation, partnership, association, joint venture or other
business entity of which more than 50% of the total voting
power of shares of stock or other ownership interests entitled
(without regard to the occurrence of any contingency) to vote
in the election of the Person or Persons (whether directors,
managers, trustees or other Persons performing similar
functions) having the power to direct or cause the direction
of the management and policies thereof is at the time owned or
controlled, directly or indirectly, by that Person or one or
more of the other Subsidiaries of that Person or a combination
thereof. For the purpose of this definition, (1) neither of
the Sumitomo Joint Ventures shall be deemed a direct or
indirect Subsidiary of LTV, (2) neither the Trico Joint
Venture, the LTV Trico Member, nor Trico Sales Co. shall be
deemed a direct or indirect Subsidiary of LTV, and (3) any
Joint Venture hereafter formed in which LTV and its
Subsidiaries own 50% or less of the voting interests (and the
Investment is made therein pursuant to Sections 7.6 (vi),
(vii) and (x)) shall not be deemed a Subsidiary of LTV even if
LTV or one of its Subsidiaries has the power to direct the
management and policies thereof. In addition, for the purpose
of this definition, neither Presque Isle Corporation, a
Delaware corporation, nor LAS Resources, Inc., a West Virginia
corporation, nor Olga Coal Company, a West Virginia
corporation (or their successors) shall be deemed to be a
Subsidiary of LTV or LTV Steel (other than for purposes of
Section 4) unless and until (i) LTV owns, directly or
indirectly, outstanding capital stock of such Person having
55% or more of the votes entitled to be cast in the election
of directors, (ii) the number of shareholders of such Person
shall increase from the number on the date hereof; PROVIDED
that for purposes of calculating such number, shareholders
that are Affiliates of each other shall be deemed to be a
single shareholder, (iii) there shall occur any material
change in the type of business conducted by such Person from
that conducted by it on the date hereof, (iv) such Person
acquires any of the capital stock or assets (other than in the
ordinary course of business) of, or merges or consolidates
with or into, any Subsidiary of LTV (other than any Subsidiary
of such Person) or (v) LTV acquires, directly or indirectly,
whether through the ownership of voting securities, by
contract or
-2-
<PAGE> 3
otherwise, any power to direct or cause the direction of the
management and policies of such Person that differs materially
from the power that it has on the date hereof. If any of the
events in clauses (i) through (v) shall occur, such Person
shall cease to be excluded from the definition of Subsidiary
and shall be automatically deemed to be a Subsidiary."
3. On and after the Amendment Effective Date, Section 1.1 of
the Credit Agreement is hereby amended by inserting the following new
definitions in the appropriate alphabetical order:
"LTV TRICO MEMBER shall mean LTV-Trico, Inc., a Delaware
corporation, and any other wholly owned Subsidiary of LTV that
is a member of the Trico Joint Venture at such time."
"TRICO JOINT VENTURE shall mean Trico Steel Company, L.L.C., a
Delaware limited liability company, or any successor entity
thereto."
"TRICO TRANSACTION DOCUMENTS shall mean the Transaction
Agreement dated as of May 2, 1995 relating to the formation of
the Trico Joint Venture and each Transaction Document referred
to in such Transaction Agreement, each as amended, modified or
supplemented from time to time."
"TRICO SALES CO. shall mean Trico Steel Company, Inc., a
Delaware corporation."
4. On and after the Amendment Effective Date, Section 7.2 of
the Credit Agreement is hereby amended by (i) deleting the word "and"
immediately prior to clause (xv) thereof, (ii) deleting the period at the end
of clause (xv) thereof and substituting in lieu thereof "; and" and (iii)
inserting the following new clause (xvi) after clause (xv):
"(xvi) Liens on the capital stock, other ownership interests,
assets or property of the Trico Joint Venture, the LTV Trico
Member or Trico Sales Co. granted or created in favor of any
Person pursuant to the Trico Transaction Documents."
5. On and after the Amendment Effective Date, Section 7.8 of
the Credit Agreement is hereby amended by deleting the word "and" immediately
prior to clause (vi) thereof and inserting a comma in lieu thereof and by
inserting the following text immediately prior to the period at the end of
Section 7.8:
"and (vii) any transaction or series of transactions in the
ordinary course of business (x) contemplated by or pursuant to
the Trico Transaction Documents or (y) between the Trico Joint
Venture, the LTV Trico Member or Trico Sales Co., on the one
hand, and LTV or any of its Subsidiaries, on the other."
-3-
<PAGE> 4
6. In order to induce the undersigned Lenders to enter into
this Amendment, LTV and the Borrowers hereby represent and warrant that:
(a) No Default or Event of Default exists as of the Amendment
Effective Date and after giving effect to this Amendment;
(b) On the Amendment Effective Date after giving effect to
this Amendment, all representations and warranties contained in the
Credit Agreement and the other Credit Documents are true and correct
in all material respects; and
(c) On and after the Amendment Effective Date, this
Amendment, and the transactions permitted hereby, shall be permitted
by, and shall not violate any material term of or cause a breach of,
any of the Related Agreements.
7. This Amendment is limited as specified and shall not
constitute a modification, acceptance or waiver of any other provision of the
Credit Agreement or any other Credit Document.
8. This Amendment may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which counterparts when executed and delivered shall be an original, but all
of which shall together constitute one and the same instrument. A complete set
of counterparts shall be lodged with LTV, the Borrowers and the Agent.
9. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW
OF THE STATE OF NEW YORK.
10. This Amendment shall become effective as of the date
hereof on the date (the "Amendment Effective Date") when LTV, the Borrowers and
the Required Lenders shall have signed a copy hereof (whether the same or
different copies) and shall have delivered (including by way of facsimile
device) the same to the Agent.
11. From and after the Amendment Effective Date, all
references in the Credit Agreement and each of the Credit Documents to the
Credit Agreement shall be deemed to be references to such Credit Agreement as
amended hereby.
* * *
-4-
<PAGE> 5
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed and delivered by their proper and duly authorized
officers as of the date set forth above.
LTV STEEL COMPANY, INC.
By: A.W. Huge
---------------------------------
Title: Senior Vice President-Finance
and CFO
CONTINENTAL EMSCO COMPANY
By: A.W. Huge
---------------------------------
Title: Vice President and Controller
LTV STEEL MINING CO.,
By: Youngstown Erie Corporation
By: A.W. Huge
---------------------------------
Title: Vice President and Controller
By: Erie B Corporation
By: A.W. Huge
---------------------------------
Title: Vice President and Controller
-5-
<PAGE> 6
By: Erie I Corporation
By: A.W. Huge
---------------------------------
Title: Vice President and Controller
LTV STEEL TUBULAR PRODUCTS COMPANY
By: A.W. Huge
---------------------------------
Title: Vice President and Controller
THE LTV CORPORATION
By: A.W. Huge
---------------------------------
Title: Senior Vice President and CFO
BT COMMERCIAL CORPORATION,
individually and as Agent
and Collateral Agent
By: Unlegible
---------------------------------
Title:
CHEMICAL BANK, as a Lender
By: R. Potter
---------------------------------
Title: Managing Director
-6-
<PAGE> 7
THE LONG-TERM CREDIT BANK OF JAPAN,
LTD., as a Lender
By: Unlegible
---------------------------------
Title: Senior Vice President &
Joint General Manager
MELLON BANK, N.A., as a Lender
By: Roger N. Stanier
---------------------------------
Title: Roger N. Stanier
THE SUMITOMO BANK, LTD.,
CHICAGO BRANCH, as a Lender
By: Katsuyasu Iwasawa
---------------------------------
Title: Joint General Manager
PNC BANK, NATIONAL ASSOCIATION,
as a Lender
By: Julianne McKenzie
---------------------------------
Title: Vice President
-7-
<PAGE> 8
CREDIT LYONNAIS, CHICAGO
BRANCH, as a Lender
By: Unlegible
---------------------------------
Title: Vice President
CAISSE NATIONALE DE CREDIT
AGRICOLE, as a Lender
By: Dean Balice
---------------------------------
Title: Senior Vice President
Branch Manager
NATIONAL CITY BANK, as a Lender
By: Davis R. Bonner
---------------------------------
Title: Vice President
SOCIETY NATIONAL BANK, as a Lender
By: Unlegible
---------------------------------
Title: Vice President
-8-
<PAGE> 9
SECOND AMENDMENT TO LETTER OF CREDIT AGREEMENT
----------------------------------------------
AND RELEASE OF COLLATERAL
-------------------------
SECOND AMENDMENT (the "Amendment"), dated as of May 10,
1995, among The LTV Corporation, a Delaware corporation
("LTV"), LTV Steel Company, Inc., a New Jersey corporation,
Continental Emsco Company, a Delaware corporation, LTV Steel
Mining Company, a Minnesota limited partnership, LTV Steel
Tubular Products Company, a Delaware corporation (the
"Borrowers"), the financial institutions party to the Credit
Agreement referred to below (the "Lenders") and BT
Commercial Corporation, acting as Agent (the "Agent") in the
manner and to the extent described in Article 9 of the
Credit Agreement referred to below. All capitalized terms
used herein and not otherwise defined shall have the
respective meanings provided such terms in the Credit
Agreement.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, LTV, the Borrowers, the Lenders and the Agent
are parties to a Credit Agreement, dated as of October 12,
1994 (as amended, modified or supplemented to the date
hereof. the "Credit Agreement"),
WHEREAS, the parties to the Credit Agreement wish to
amend the Credit Agreement to permit (i) LTV to sell the
stock of Continental Emsco, LTV Properties, Inc. and
Continental Supply Company (or any of them) or to cause
Continental Emsco, LTV Properties, Inc. and Continental
Supply Company to sell all or a substantial portion of their
assets, pursuant to a purchase agreement (the "Continental
Emsco Sale"), (ii) Continental Emsco to cease as a
"Borrower" and (iii) the release of all of the assets of
Continental Emsco from the security interest and any other
liens or interest under the Inventory Security Agreement
(the "Security Interest");
NOW, THEREFORE, it is agreed:
1. On the Second Amendment Effective Date (immediately
prior to giving effect to the Continental Emsco Sale), (i)
Continental Emsco shall cease to be a Borrower and shall
have no further obligations thereunder (including, without
limitation, as a Guarantor thereunder), and (ii) each Letter
of Credit issued for the account of Continental Emsco and in
effect on the date hereof, a list of which shall be
delivered to the Agent and the respective Issuing Lender on
or prior to the Second Amendment Effective Date (each, a
"Continental Emsco Letter of Credit"), shall cease to be a
Letter of Credit, and each Lender other than the relevant
Issuing Lender with respect to each such Continental Emsco
Letter of Credit shall thereupon be released from its
obligations with respect thereto (including its obligations
to the Issuing Lender with respect thereto) without further
action on the part of any Person.
<PAGE> 10
2. Section 7.1 of the Credit Agreement is
hereby waived to the extent required to permit the
Continental Emsco Sale, and without limiting the foregoing,
the proceeds of such sale shall in no event be taken into
account in determining the amount of asset sales made
pursuant to clause (viii) thereof.
3. On the Second Amendment Effective Date
(immediately prior to giving effect to the Continental Emsco
Sale), the Security shall be released with respect to any
and all assets of Continental Emsco, LTV Properties, Inc.
and Continental Supply Company (including all proceeds
thereof) in accordance with Section 9.9 of the Credit
Agreement. On the Second Amendment Effective Date
(immediately prior to giving effect to the Continental Emsco
Sale), the Collateral Agent shall in accordance with Section
9.9 of the Credit Agreement execute and deliver to
Continental Emsco such UCC-3 termination statements under
the Uniform Commercial Code to be filed in relevant
jurisdictions and shall take such further action to evidence
such release as Continental Emsco shall reasonably request,
all at Continental Emsco's sole cost and expense and each
Lender hereby confirms the Collateral Agent's authority to
do so as set forth in Section 9.9(b) of the Credit
Agreement.
4. In order to induce the undersigned
Lenders to enter into this Amendment, LTV and the Borrowers
hereby represent and warrant that:
(a) No Default or Event of Default exists as
of the Second Amendment Effective Date and after
giving effect to this Amendment;
(b) On the Second Amendment Effective Date
after giving effect to this Amendment, all
representations and warranties contained in the
Credit Agreement and the other Credit Documents are
true and correct in ail material respects;
(c) On and after the Second Amendment
Effective Date, this Amendment, and the transactions
permitted hereby, shall be permitted by, and shall
not violate any material term of or cause a breach
of, any of the Related Agreements;
(d) On the Second Amendment Effective Date
(immediately prior to giving effect to the
Continental Emsco Sale), LTV and the Borrower shall
have received all required consents necessary to
effect the Continental Emsco Sale and such consents
shall remain in full force and effect, and
(e) To the extent the Continental Emsco Sale
is effected pursuant to Section 22 of the Security
Agreement rather than Section 20(b) of the Security
Agreement, then LTV and LTV Steel shall have
delivered such Officer's Certificates as may be
required pursuant to Section 3.1 (b) of the
Inventory Intercreditor Agreement.
5. This Amendment is limited as specified
and shall not constitute a modification, acceptance or
waiver of any other provision of the Credit Agreement or any
other Credit Document.
-2-
<PAGE> 11
6. This Amendment may be executed in any number
of counterparts and by the different parties hereto on
separate counterparts, each of which counterparts when
executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A
complete set of counterparts shall be lodged with LTV, the
Borrowers and the Agent.
7. THIS AMENDMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW
YORK.
8. This Amendment shall become effective on
the date (the "Second Amendment Effective Date") on which (i)
LTV, the Borrowers and the Required Lenders shall have signed
a copy hereof (whether the same or different copies) and
shall have delivered (including by way of facsimile device)
the same to the Agent and (ii) with respect to each
Continental Emsco Letter of Credit, each of the respective
Issuing Lenders shall have been provided a letter of credit
in form and substance satisfactory to such Issuing Lender
supporting the obligations of Continental Emsco thereunder
issued by a bank or other financial institution the long-term
unsecured public debt of whom (or of whose parent holding
company) is rated at least A- by Standard & Poor's Ratings
Group or at least A3 by Moody's Investors Service, Inc., or
which is otherwise reasonably acceptable to such Issuing
Lender, each in a stated amount equal to the maximum stated
amount of, and with an expiry date no earlier than that of,
such Continental Emsco Letter of Credit.
9. From and after the Second Amendment
Effective Date, all references in the Credit Agreement and
each of the Credit Documents to the Credit Agreement shall be
deemed to be references to such Credit Agreement as amended
hereby.
-3-
<PAGE> 12
IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to be executed and delivered by their proper and
duly authorized officers as of the date set forth above.
THE LTV CORPORATION
By: /s/ A. W. Huge
------------------
Title: Senior Vice President & CFO
LTV STEEL COMPANY, INC.
By: /s/ A. W. Huge
------------------
Title: Senior Vice President-Finance
& CFO
CONTINENTAL EMSCO COMPANY
By: /s/ A. W. Huge
------------------
Title: Vice President & Controller
LTV STEEL MINING CO.,
By: Youngstown Erie Corporation
By: /s/ A. W. Huge
------------------
Title: Vice President & Controller
-4-
<PAGE> 13
BY: Erie B Corporation
By: A.W. Huge
-------------------------------
Title: Vice President & Controller
By: Erie I Corporation
By: A.W. Huge
-------------------------------
Title: Vice President & Controller
LTV STEEL TUBULAR PRODUCTS COMPANY
By: A.W. Huge
-------------------------------
Title: Vice President & Controller
BT COMMERCIAL CORPORATION,
individually and as Agent
and Collateral Agent
By: Linda ??????????
-------------------------------
Title: Vice President
CHEMICAL BANK, as a Lender
By: John F. Gehebe
-------------------------------
Title: Assistant Vice President
-5-
<PAGE> 14
THE LONG-TERM CREDIT BANK OF JAPAN,
LTD., as a Lender
By: ?????????
-------------------------------------
Title: Vice President & Deputy
General Manager
MELLON BANK, N.A., as a Lender
By:
-------------------------------------
Title
THE SUMITOMO BANK, LTD.,
CHICAGO BRANCH, as a Lender
By: James W. Semonchik
-------------------------------------
Title: Senior Vice President
PNC BANK, NATIONAL ASSOCIATION,
as a Lender
By: Julianne S. McKenzie
-------------------------------------
Title: Vice President
-6-
<PAGE> 15
CREDIT LYONNAIS, CHICAGO
BRANCH, as a Lender
By: Mary Ann Klemm
------------------------------------
Title: Vice President and Group Head
CAISSE NATIONALE DE CREDIT
AGRICOLE, as a Lender
By: Dean Balice
------------------------------------
Title: Senior Vice President
Branch Manager
NATIONAL CITY BANK, as a Lender
By: Davis R. Bonner
------------------------------------
Title: Vice President
SOCIETY NATIONAL BANK, as a Lender
By: ?????????????
------------------------------------
Title: Vice President
-7-
<PAGE> 16
THIRD AMENDMENT TO LETTER OF CREDIT AGREEMENT
---------------------------------------------
THIRD AMENDMENT (the "Amendment"), dated as of June 2, 1995,
among The LTV Corporation, a Delaware corporation ("LTV"), LTV Steel
Company, Inc., a New Jersey corporation, Continental Emsco Company, a
Delaware corporation, LTV Steel Mining Company, a Minnesota limited
partnership, LTV Steel Tubular Products Company, a Delaware corporation
(the "Borrowers"), the financial institutions party to the Credit Agreement
referred to below (the "Lenders") and BT Commercial Corporation, acting as
Agent (the "Agent") in the manner and to the extent described in Article 9
of the Credit Agreement referred to below. All capitalized terms used
herein and not otherwise defined shall have the respective meanings
provided such terms in the Credit Agreement.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, LTV, the Borrowers, the Lenders and the Agent are
parties to a Credit Agreement, dated as of October 12, 1994 (as amended,
modified or supplemented to the date hereof, the "Credit Agreement");
WHEREAS, LTV intends, directly or through any of its
Subsidiaries, to sell, transfer or otherwise dispose of (whether by sale of
assets or stock, merger or any combination thereof) all or any of the
assets or the capital stock of Continental Emsco, LTV Properties. Inc. and
Continental Supply Company (the "Continental Emsco Sale");
WHEREAS, pursuant to the Second Amendment to the Credit
Agreement and Release of Collateral dated as of May 2, 1995, LTV received
consent for the Continental Emsco Sale and release of Collateral in
connection therewith;
WHEREAS, LTV, directly or through a Subsidiary, intends (i)
to purchase from the PBGC all of the outstanding Republic Notes for the
Accreted Value thereof (as defined in such Republic Notes) as of the date
of such purchase, and (ii) if the net proceeds from the Continental Emsco
Sale exceed $70 million, to purchase from the PBGC a portion of the
outstanding Zero Coupon Notes in the aggregate face amount of $50 million
for the Accreted Value thereof (as defined in such Zero Coupon Notes) as of
the date of such purchase (the transactions referred to in clauses (i) and
(ii) being collectively referred to herein as the "Note Repurchases"),
WHEREAS, after the Note Repurchases, LTV Steel wishes to
issue, in exchange for the Zero Coupon Notes remaining outstanding
following the Note Repurchases, promissory notes ("Promissory Notes")
substantially in the form of Exhibit A attached to this Amendment (fully
guaranteed by LTV and each ERISA Affiliate) with an issue date of the June
30 or December 31 immediately preceding such issuance and having an
aggregate principal amount equal to the Accreted Value (as defined in such
Zero
<PAGE> 17
Coupon Notes) of such remaining Zero Coupon Notes, as of such issue date
(the "Note Exchange"); and
WHEREAS, the Borrowers desire that the Credit Agreement be
further amended to the extent necessary to permit the Note Repurchases, the
Note Exchange and the payment of interest and prepayment of principal from
time to time on the Promissory Notes (including any Promissory Notes issued
in payment of interest on other Promissory Notes);
NOW, THEREFORE, it is agreed:
1. The definition of "Available Capital Expenditure Amount"
contained in Section 1.1 of the Credit Agreement is hereby amended by (i)
deleting the word "and" appearing at the end of clause (iii) and inserting
"," in lieu thereof; (ii) deleting the period at the end of clause (iv)
and substituting "and" in lieu thereof and (iii) inserting the following
new clause (v):
"(v) MINUS an amount equal to the aggregate cash payments
of LTV and its Subsidiaries to the PBGC with respect to the
Note Repurchases and any prepayment of principal on the
Promissory Notes from the Closing Date to such date."
2. Section 1.1 of the Credit Agreement is hereby further
amended by adding the following new definitions in appropriate alphabetical
order:
"NOTE EXCHANGE shall have the meaning provided in the Third
Amendment to the Credit Agreement dated as of June 2, 1995.
"NOTE REPURCHASES shall have the meaning provided in the
Third Amendment to the Credit Agreement dated as of June 2, 1995.
"PROMISSORY NOTES shall mean promissory notes issued by LTV
Steel: (i) to the PBGC in exchange for the Zero Coupon Notes
remaining outstanding following the Note Repurchases; and (ii) in
payment of interest on other Promissory Notes (in both cases, such
Promissory Notes being issued substantially in the form of Exhibit
A attached to the Third Amendment to the Credit Agreement dated as
of June 2, 1995.
3. Section 7.3 of the Credit Agreement is hereby amended by
(i) deleting the word "and" appearing at the end of clause (xiv) thereof;
(ii) deleting the period at the end of clause (xv) and inserting "; and" in
lieu thereof and (iii) and inserting the following new clause (xvi):
-2-
<PAGE> 18
"(xvi) LTV and its Subsidiaries may become and remain
liable with respect to the issuance and guarantee of the
Promissory Notes, and any such Indebtedness will not count toward
the limit on outstanding other Indebtedness in Section 7.3(xv)
above."
4. Section 7.7 of the Credit Agreement is hereby amended
by (i) deleting the word "and" appearing at the end of clause (iv)
thereof; (ii) deleting the period at the end of clause (v) and
substituting "; and" in lieu thereof and (iii) inserting the following new
clause (vi):
"(vi) as long as no Default or Event of Default exists or
would arise therefrom the Note Repurchases, the Note
Exchange, and the payment of interest (in cash and/or
through the issuance of additional Promissory Notes) and
the prepayment of principal on the Promissory Notes shall
be permitted."
5. Section 7.15 of the Credit agreement is hereby waived
to the extent required to permit the Note Repurchases, the Note Exchange,
and the payment of interest (in cash and/or through the issuance of
additional Promissory Notes) and the prepayment of principal on the
Promissory Notes.
6. In order to induce the undersigned Lenders to enter
into this Amendment, LTV and the Borrowers hereby represent and warrant
that:
(a) No Default or Event of Default exists as of the Third
Amendment Effective Date and after giving effect to this
Amendment;
(b) On the Third Amendment Effective Date after giving
effect to this Amendment, all representations and warranties
contained in the Credit Agreement and the other Credit Documents
are true and correct in all material respects; and
(c) On and after the Third Amendment Effective Date, this
Amendment, and the transactions permitted hereby, shall be
permitted by, and shall not violate any material term of or cause
a breach of, any of the Related Agreements.
7. This Amendment is limited as specified and shall not
constitute a modification, acceptance or waiver of any other provision of
the Credit Agreement or any other Credit Document.
8. This Amendment may be executed in any number of
counterparts and by the different parties hereto on separate counterparts,
each of which counterparts when executed and delivered shall be an
original, but all of which shall together constitute one and the same
instrument. A complete set of counterparts shall be lodged with LTV, the
Borrowers and the Agent.
-3-
<PAGE> 19
9. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
10. This Amendment shall become effective on the date (the
"Third Amendment Effective Date") on which LTV, the Borrowers and the
Required Lenders shall have signed a copy hereof (whether the same or
different copies) and shall have delivered (including by way of facsimile
device) the same to the Agent.
11. From and after the Third Amendment Effective Date, all
references in the Credit Agreement and each of the Credit Documents to the
Credit Agreement shall be deemed to be references to such Credit Agreement as
amended hereby.
* * *
-4-
<PAGE> 20
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be executed and delivered by their proper and duly authorized officers as of
the date set forth above.
THE LTV CORPORATION
By: /s/ A.W. Huge
-------------------------
Title: Senior Vice President and
Chief Financial officer
LTV STEEL COMPANY, INC.
By: /s/ A.W. Huge
-------------------------
Title: Senior Vice President - Finance and
Chief Financial Officer
CONTINENTAL EMSCO COMPANY
By: /s/ A.W. Huge
-------------------------
Title: Vice President & Controller
LTV STEEL MINING CO.,
By: Youngstown Erie Corporation
By: /s/ A.W. Huge
-------------------------
Title: Vice President & Controller
-5-
<PAGE> 21
By: Erie B Corporation
By: /s/ A.W. Huge
-------------------------
Title: Vice President & Controller
By: Erie I Corporation
By: /s/ A.W. Huge
-------------------------
Title: Vice President & Controller
LTV STEEL TUBULAR PRODUCTS COMPANY
By: /s/ A.W. Huge
-------------------------
Title: Vice President & Controller
BT COMMERCIAL CORPORATION,
individually and as Agent
and Collateral Agent
By: /s/ Linda Melomar
-------------------------
Title: Vice President
CHEMICAL BANK, as a Lender
By: /s/ illegible
-------------------------
Title: Managing Director
-6-
<PAGE> 22
THE LONG-TERM CREDIT BANK OF JAPAN,
LTD., as a Lender
By: /s/ illegible
-------------------------
Title: Vice President & Deputy
General Manager
MELLON BANK, N.A., as a Lender
By: /s/ Roger N. Stanier
-------------------------
Title: Vice President
THE SUMITOMO BANK, LTD.,
CHICAGO BRANCH, as a Lender
By: /s/ James W. Semonchik
-------------------------
Title: Senior Vice President
PNC BANK, NATIONAL ASSOCIATION,
as a Lender
By:
-------------------------
Title:
-7-
<PAGE> 23
CREDIT LYONNAIS, CHICAGO
BRANCH, as A lENDER
By: /s/ illegible
-------------------------
Title: illegible
CAISSE NATIONALE DE CREDIT
AGRICOLE, as a Lender
By: /s/ David ?
-------------------------
Title: Head of Corporate Banking
Chicago
NATIONAL CITY BANK, as a Lender
By: /s/ Davis R. Bonner
-------------------------
Title: Vice President
SOCIETY NATIONAL BANK, as a Lender
By: /s/ illegible
-------------------------
Title: Vice President
-8-
<PAGE> 24
FOURTH AMENDMENT TO LETTER OF CREDIT AGREEMENT
----------------------------------------------
FOURTH AMENDMENT (the "Amendment"), dated as of
July 31, 1995, among The LTV Corporation, a Delaware
corporation ("LTV"), LTV Steel Company, Inc., a New Jersey
corporation, Continental Emsco Company, a Delaware corporation,
LTV Steel Mining Company, a Minnesota limited partnership, LTV
Steel Tubular Products Company, a Delaware corporation (the
"Borrowers"), the financial institutions party to the Credit
Agreement referred to below (the "Lenders") and BT Commercial
Corporation, acting as Agent (the "Agent") in the manner and to
the extent described in Article 9 of the Credit Agreement
referred to below. All capitalized terms used herein and not
otherwise defmed shall have the respective meanings provided
such terms in the Credit Agreement.
WITNESSETH:
----------
WHEREAS, LTV, the Borrowers, the Lenders and the
Agent are parties to a Credit Agreement, dated as of October
12, 1994 (as amended, modified or supplemented to the date
hereof, the "Credit Agreement");
WHEREAS, pursuant to the Second Amendment to the
Credit Agreement and Release of Collateral dated as of May 10,
1995, LTV received consent for the Continental Emsco Sale and
release of Collateral in connection therewith;
WHEREAS, pursuant to the Third Amendment to the
Letter of Credit Agreement dated as of June 2, 1995, LTV
received consent for the Note Repurchases and the Note
Exchange; and
WHEREAS, the Borrowers desire that the Credit
Agreement be further amended to the extent necessary to permit
the assumption by LTV of certain Continental Emsco Letter of
Credit Obligations and the other changes contemplated herein;
NOW, THEREFORE, it is agreed:
1. Notwithstanding that Continental Emsco is the
account party and is no longer a Borrower under the Credit
Agreement, on the Fourth Amendment Effective Date, LTV hereby
assumes all of the obligations of Continental Emsco with
respect to, and Continental Emsco is expressly released from
all obligations with respect to, each Letter of Credit set
forth on Schedule I hereto as if LTV were the account party on
such Letters of Credit.
<PAGE> 25
2. The definition of "Note Repurchases"
contained in the Third Amendment to the Credit Agreement is
hereby amended by deleting the amount "$70 million" appearing
therein and inserting in lieu thereof the amount "$60 million".
3. The Third Amendment to the Credit Agreement
is hereby amended by deleting the date "May 2, 1995" appearing
therein in the third WHEREAS clause and inserting in lieu
thereof "May 10, 1995."
4. In order to induce the undersigned Lenders
to enter into this Amendment, LTV and the Borrowers hereby
represent and warrant that:
(a) No Default or Event of Default exists as of
the Fourth Amendment Effective Date and after giving
effect to this Amendment;
(b) On the Fourth Amendment Effective Date
after giving effect to this Amendment, all
representations and warranties contained in the Credit
Agreement and the other Credit Documents are true and
correct in all material respects; and
(c) On and after the Fourth Amendment Effective
Date, this Amendment, and the transactions permitted
hereby, shall be permitted by, and shall not violate
any material term of or cause a breach of, any of the
Related Agreements.
5. This Amendment is limited as specified and
shall not constitute a modification, acceptance or waiver of
any other provision of the Credit Agreement or any other Credit
Document.
6. This Amendment may be executed in any number
of counterparts and by the different parties hereto on separate
counterparts, each of which counterparts when executed and
delivered shall be an original, but all of which shall together
constitute one and the same instrument. A complete set of
counterparts shall be lodged with LTV, the Borrowers and the
Agent.
7. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
8. This Amendment shall become effective on the
date (the "Fourth Amendment Effective Date") on which LTV, the
Borrowers and the Required Lenders shall have signed a copy
hereof (whether the same or different copies) and shall have
delivered (including by way of facsimile device) the same to
the Agent.
9. From and after the Fourth Amendment
Effective Date, all references in the Credit Agreement and each
of the Credit Documents to the Credit Agreement shall be deemed
to be references to such Credit Agreement as amended hereby.
- 2-
<PAGE> 26
* * *
IN WITNESS WHEREOF, the parties hereto
have caused this Amendment to be executed and delivered by
their proper and duly authorized officers as of the date
set forth above.
THE LTV CORPORATION
By: J.C. Skurek
-----------------------------
Title:
LTV STEEL COMPANY, INC.
By: J.C. Skurek
-----------------------------
Title:
CONTINENTAL EMSCO COMPANY
By: J.C. Skurek
-----------------------------
Title:
LTV STEEL MINING CO.,
By: Youngstown Erie Corporation
By: J.C. Skurek
-----------------------------
Title:
-3-
<PAGE> 27
By: Erie B Corporation
By: J.C. Skurek
-----------------------------
Title:
By: Erie I Corporation
By: J.C. Skurek
-----------------------------
Title:
LTV STEEL TUBULAR PRODUCTS
COMPANY
By: J.C. Skurek
-----------------------------
Title:
BT COMMERCIAL CORPORATION,
individually and as Agent
and Collateral Agent
By: Linda Melomar
-----------------------------
Title: Vice President
CHEMICAL BANK, as a Lender
By: James H. Ramage
-----------------------------
Title: Vice President
<PAGE> 28
THE LONG-TERM CREDIT BANK OF
JAPAN, LTD., as a Lender
By: ?????????
-----------------------------
Title: Vice President & Deputy
General Manager
MELLON BANK, N.A., as a Lender
By: Roger N. Stanier
-----------------------------
Title: Vice President
THE SUMITOMO BANK, LTD.,
CHICAGO BRANCH, as a Under
By: Hiroyuki Iwami
-----------------------------
Title: Joint General Manager
PNC BANK, NATIONAL ASSOCIATION,
as a Lender
By: Joseph G. Moran
-----------------------------
Title: Vice President
CREDIT LYONNAIS, CHICAGO
BRANCH, as a Lender
By: Mary Ann Klemm
-----------------------------
Title: Vice President and
Group Head
<PAGE> 29
CAISSE NATIONALE DE CREDIT
AGRICOLE, as a Lender
By: David Bouhl
-----------------------------
Title: Head of Corporate Banking
Chicago
NATIONAL CITY BANK, as a Lender
By: Davis R. Bonner
-----------------------------
Title: Vice President
SOCIETY NATIONAL BANK, as a Lender
By: ???????????
-----------------------------
Title:
<PAGE> 30
Schedule I
<TABLE>
<CAPTION>
LC# $ BALANCE BENEFICIARY EXPIRY EVERG. FINAL
<S> <C> <C> <C>
BANKERS TRUST COMPANY
S781964 $15,515.28 ATWOOD OCEANICS 09/30/95 N N
S781872 $5908.50 ATWOOD OCEANICS 09/30/95 N N
S793309 $148,855.00 ATLANTIC RICHFIELD 09/30/97 N N
S793311 $193,624.00 ATLANTIC RICHFIELD 12/31/97 N N
S793519 $32,192.00 SEMBAWANG 01/31/96 N N
S794096 $66,462.00 MINERA ESCONDIA LT 05/23/96 N N
S794108 $166,785.90 ATWOOD OCEANICS 09/30/95 N N
S794275 $70,608.20 BANK OF CHINA 08/22/96 N N
S794848 $7,955.60 MINERA ESCONDIA 06/15/96 N N
$707,906.48 TOTAL
MELLON
S806867 $204,832.69 OILFIELD DEVELOP 06/28/96 N N
S819521 $175,004.90 BOHAI OIL CORP 08/31/95 N N
S823817 $115,465.49 AMEC ENGINEERING 07/30/95 N N
S823824 $101,376.30 AMEC ENGINEERING 07/30/95 N N
S823828 $10,484.49 AMEC ENGINEERING 07/30/95 N N
S823830 $26,817.20 AMEC ENGINEERING 07/30/95 N N
S824518 $23,040.50 ARCO CHINA INC 01/01/96 N N
$657,021.57 TOTAL
CHEMICAL
7224555 $47,665.70 BANK BUMIPUTRA 10/30/95 y N
T228974 $276,161.60 VARYEGANNEFTEGAZ 09/10/96 N N
T231489 $34,025.50 SARAWAK SHELL 05/26/96 y 05/26/96
T231490 $22,863.74 SARAWAK SHELL 05/29/96 y 05/29/96
T231491 $17,447.99 SARAWAK SHELL 02/13/96 y 02/13/96
T231746 $12,992.40 LARSON & TOUBRO 06/24/96 y N
$411,156.93 TOTAL
$1,776.084.98 GRAND TOTAL
</TABLE>
<PAGE> 1
Exhibit (10)-(57)
AMENDMENT NO. 1 TO RECEIVABLES PURCHASE AND SALE AGREEMENT
AND
CONSENT UNDER REVOLVING CREDIT AGREEMENT
AMENDMENT AND CONSENT (the "Amendment") dated as
of May , 1995 to (i) the Revolving Credit Agreement dated
as of October 12, 1994 (as in effect on the date hereof, the
"Revolving Credit Agreement") among LTV Sales Finance
Company ("Sales Finance"), the financial institutions
parties thereto as Banks, the Issuing Banks referred to
therein and Bankers Trust Company, as Collateral Agent and
Facility Agent and (ii) the Receivables Purchase and Sale
Agreement dated as of October 12, 1994 (as in effect on the
date hereof, the "Receivables Purchase Agreement") among The
LTV Corporation ("LTV"), the Sellers named therein,
including Continental Emsco Company ("Continental Emsco"),
LTV Steel Company, Inc., as Servicer, and Sales Finance, as
Purchaser.
LTV intends to sell the stock of Continental
Emsco, or to cause Continental Emsco to sell all or a
substantial portion of its assets, and desires that (i)
Continental Emsco cease being a "Seller" under the
Receivables Purchase Agreement, (ii) repurchase the
Receivables and Related Security heretofore transferred by
Continental Emsco under the Receivables Purchase Agreement
and outstanding on the date hereof, and (iii) have
reconveyed to it Lock-Box Accounts and related lock-boxes
transferred by Continental Emsco (such assets and accounts
in items (ii) and (iii) collectively, the "Transferred
Continental Emsco Assets") ; and the parties hereto have
agreed so to provide. The parties hereto therefore agree as
follows:
1. DEFINITIONS; REFERENCES. Unless otherwise
specifically defined herein, each term used herein which is
defined in the Revolving Credit Agreement or the Receivables
Purchase Agreement shall have the meaning assigned to such
term therein. Each reference to "hereof", "hereunder",
"herein" and "hereby" and each other similar reference and
each reference to "this Agreement" and each other similar
reference contained in the Revolving Credit Agreement or the
Receivables Purchase Agreement, as the case may be, shall
from and after the date hereof refer to the Revolving Credit
Agreement or the Receivables Purchase Agreement,
respectively, as amended hereby.
<PAGE> 2
2. CONTINENTAL EMSCO AS TERMINATING SELLER. On
the Effective Date (as defined in Section 6 below), and
without need of the notice period provided in Section
2.07(i) of the Receivables Purchase Agreement, Continental
Emsco shall be a Terminating Seller as defined in Section
2.07 of the Receivables Purchase Agreement and shall
thereupon cease to be a Seller, as defined in the
Receivables Purchase Agreement, for any and all purposes
thereof, and have no further obligations thereunder, except
to the extent provided in such Section 2.07.
3. RECONVEYANCE OF ASSETS AND ACCOUNTS. Sales
Finance hereby reconveys to Continental Emsco, effective on
the Effective Date, all right, title and interest of Sales
Finance in and to all of the Transferred Continental Emsco
Assets. The price for reconveyance of the Transferred
Continental Emsco Assets shall be the aggregate outstanding
balance on the Effective Date of the Receivables included in
such assets, as set forth in the certificate referred to in
Section 6(ii) below (the "Purchase Price"), and shall be
payable in cash within two Business Days after the Effective
Date. Immediately upon such reconveyance and receipt of
such Purchase Price, Sales Finance will have no further
ownership, security or other interest in any Transferred
Continental Emsco Assets.
4. RELEASES PURSUANT TO THE REVOLVING CREDIT
AGREEMENT. Effective on the Effective Date and upon the
receipt by Sales Finance of the Purchase Price, the
Collateral Agent hereby releases any and all security and
other interests under the Revolving Credit Agreement or the
other Facility Documents that it may have in the Transferred
Continental Emsco Assets.
5. WAIVER OF SECTION 8.07. Section 8.07 of the
Revolving Credit Agreement is hereby waived to the extent
required to permit the amendments and modifications to the
Facility Documents otherwise contemplated by this Amendment,
and the Required Banks expressly consent to this Amendment
and the transactions contemplated hereby.
6. COUNTERPARTS; EFFECTIVENESS. This Amendment
may be signed in any number of counterparts, each of which
shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
This Amendment shall become effective as of the date (the
"Effective Date") that the Facility Agent shall have
received at or prior to such time:
(i) duly executed counterparts hereof signed
by Sales Finance and the Required Banks (in the
2
<PAGE> 3
case of the Revolving Credit Agreement) and, in
addition (in the case of the Receivables Purchase
Agreement), by Continental Emsco and the other
Sellers parties to the Receivables Purchase
Agreement (or, in the case of any party as to
which an executed counterpart shall not have been
received, the Agent shall have received
telegraphic, telex or other written confirmation
from such party of execution of a counterpart
hereof by such party); and
(ii) a certificate from a Responsible Officer
of Continental Emsco (x) that the termination by
Continental Emsco of its status as a Seller will
not have a Material Adverse Effect, as provided in
Section 2.07 of the Receivables Purchase Agreement
and (y) setting forth the aggregate outstanding
balance on the Effective Date of the Receivables
included in the Transferred Continental Emsco
Assets.
7. NOTICE TO RATING AGENCIES. Sales Finance
shall give notice of this Amendment to the Rating Agency
promptly upon the Effective Date.
8. GOVERNING LAW. This Amendment shall be
governed by and construed in accordance with the laws of the
State of New York.
3
<PAGE> 4
IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to be duly executed as of the date first
above written.
THE LTV CORPORATION
By: J.C. Skurek
--------------------------------
Title: Vice President and Treasurer
LTV STEEL COMPANY, INC.,
By: J.C. Skurek
--------------------------------
Title: Vice President and Treasurer
CONTINENTAL EMSCO COMPANY
By: J.C. Skurek
--------------------------------
Title: Vice President and Treasurer
LTV STEEL TUBULAR PRODUCTS COMPANY
By: J.C. Skurek
--------------------------------
Title: Vice President and Treasurer
GEORGIA TUBING CORPORATION
By: J.C. Skurek
--------------------------------
Title: Vice President and Treasurer
LTV SALES FINANCE COMPANY
By: J.C. Skurek
---------------------------------
Title: Vice President and Treasurer
4
<PAGE> 5
BANKERS TRUST COMPANY, as
Facility Agent and
Collateral Agent
By: /s/ Christopher Pohl
---------------------------------
Title:
ABBEY NATIONAL TREASURY
SERVICES PLC
By: /s/ illegible
---------------------------------
Title:
CAISSE NATIONALE DE
CREDIT AGRICOLE
By: /s/ Katherine L. Abbott
---------------------------------
Title: FIRST VICE PRESIDENT
LTV SALES FINANCE COMPANY
By:
---------------------------------
Title:
5
<PAGE> 1
Exhibit (10)-(58)
SIXTH AMENDMENT TO
PBGC-LTV SETTLEMENT AGREEMENT
This Sixth Amendment to the PBGC-LTV Settlement
Agreement (this "AMENDMENT") is made as of May 2, 1995, by
and among (1) Pension Benefit Guaranty Corporation ("PBGC"),
(2) The LTV Corporation, a corporation organized under the
laws of Delaware (in such capacity, "LTV"), and each other
member of the LTV Controlled Group (as defined in the
Settlement Agreement and listed on the signature pages
hereof), including, without limitation, LTV Steel Company,
Inc., a corporation organized under the laws of New Jersey
("LTV STEEL"), and (3) U.S. Trust Company of California,
N.A., as independent fiduciary (the "Independent
Fiduciary"), engaged by LTV as Named Fiduciary of the
Restored Plans to act on behalf of the Restored Plans with
respect to the transactions contemplated by this Sixth
Amendment and the Trico Subordination and Standstill
Agreement (as defined below), and is made with reference to
that certain Settlement Agreement dated as of June 28, 1993,
as amended to date (the "SETTLEMENT AGREEMENT"), by and
among PBGC, LTV, the Initial LTV Group and the
Administrator. Capitalized terms used without definition
herein shall have the same meanings as set forth in the
Settlement Agreement.
<PAGE> 2
RECITALS
WHEREAS, LTV and the LTV Controlled Group desire
to amend the Settlement Agreement to permit certain
transactions in connection with the participation by LTV,
through one or more wholly owned Subsidiaries of LTV, in the
Trico Joint Venture (as defined below) and the distribution
by Trico Sales Co. (as defined below) of steel products
manufactured by Trico Joint Venture;
WHEREAS, the Consent Order entered into by the
U.S. Department of Labor, the PBGC, LTV, and various
creditors in IN RE CHATEAUGAY CORP., No. 89 CIV 6012 (KTD)
(S.D.N.Y.) (consolidated with No. 90 CIV (KTD)) and approved
by the Court on June 7, 1993, authorized, for the purpose of
compliance with Department of Labor Prohibited Transaction
Class Exemption 79-15, the parties to carry out all
transactions authorized or required by the Settlement
Agreement;
WHEREAS, the Settlement Agreement authorizes the
amendment of that Agreement pursuant to an agreement entered
into by the PBGC, LTV, the Administrator, and LTV Steel,
evidenced by a written instrument signed by their authorized
representatives;
WHEREAS, LTV as Named Fiduciary of the respective
Restored Plans has duly delegated to the Independent
Fiduciary sole discretion to determine whether to execute
2
<PAGE> 3
this Sixth Amendment and the Trico Subordination and
Standstill Agreement on behalf of the Restored Plans;
WHEREAS, subject to the terms and conditions
contained herein, the PBGC and the Independent Fiduciary
consent and are willing to agree to such amendments as
provided below.
NOW, THEREFORE, in consideration of the premises
and the agreements, provisions and covenants herein
contained, the parties hereto agree as follows:
SECTION 1. AMENDMENTS TO DEFINITIONS
-------------------------
(i) Section 1.1 is hereby amended by adding the
following definitions following Clause (mmm) thereof as
follows:
(nnn) "LTV TRICO ENTITY" shall mean each or any
of the LTV Trico Member and Trico Sales Co.
(ooo) "LTV TRICO MEMBER" shall mean, at any time,
LTV-Trico, Inc., a Delaware corporation, and any
other Person or Persons, each of which is, at such
time, a wholly owned Subsidiary of LTV and a
member of the Trico Joint Venture and does not, at
such time, engage in any business or activities
other than (x) as a member of the Trico Joint
Venture, (y) as contemplated, with respect to
members of the Trico Joint Venture, under the
Trico Transaction Documents in effect on the Sixth
Amendment Effective Date (as defined below), or
(z) other activities ancillary or incidental to
the foregoing.
(ppp) "TRICO JOINT VENTURE" shall mean Trico
Steel Company, L.L.C., a Delaware limited
liability company, or any successor entity
thereto, that constructs and operates a steel
minimill, manufactures steel products for
distribution by Trico Sales Co., and engages
in activities ancillary or incidental
thereto. It is understood that under the
3
<PAGE> 4
transaction structure contemplated by the
Trico Transaction Agreement as in effect as
of the closing thereunder, the Trico Joint
Venture is not a member of either the LTV
Consolidated Group or the LTV Controlled
Group.
(qqq) "TRICO TRANSACTION AGREEMENT" shall mean
the Transaction Agreement dated as of May 2, 1995
relating to the formation of the Trico Joint
Venture.
(rrr) "TRICO TRANSACTION DOCUMENTS" shall mean
the Trico Transaction Agreement and each
Transaction Document referred to in the Trico
Transaction Agreement, each as amended, modified
or supplemented from time to time; PROVIDED that,
without the prior written consent of the PBGC and
the Restored Plans, no amendment, restatement,
modification or restructuring of the Trico
Transactions Documents shall, at any time after
the Sixth Amendment Effective Date, (i) prohibit
any performance or satisfaction by LTV or any
member of the LTV Controlled Group of any
obligation (whether due or not due and whether
mandatory or voluntary) under this Agreement, or
(ii) directly conflict with any rights of the PBGC
or the Restored Plans or obligations of LTV or any
member of the LTV Controlled Group with respect to
the Restored Plans as set forth in this Agreement.
For purposes of this Agreement, the Trico
Transaction Documents in effect on the Sixth
Amendment Effective Date shall be deemed to
include the Commitment Letter dated May 2, 1995
among Chemical Bank, Chemical Securities Inc.,
LTV, Sumitomo Metal Industries, Ltd. and British
Steel plc and all Financing Documents (as defined
in the Trico Transaction Agreement) entered into
on or after the Sixth Amendment Effective Date
that are substantially consistent with and
implement the terms of such Commitment Letter.
(sss) "TRICO SALES CO." shall mean Trico
Steel Company, Inc., a Delaware corporation that
(x) is a wholly owned Subsidiary of LTV on the
date hereof and (y) does not engage in any
business or activities other than as contemplated
by the Trico Transaction Documents in effect on
the Sixth Amendment Effective Date or other
activities ancillary or incidental thereto.
4
<PAGE> 5
(ttt) "TRICO SUBORDINATION AND STANDSTILL
AGREEMENT" shall mean the Subordination and
Standstill Agreement dated as of the date hereof
among the PBGC, LTV, and U.S. Trust Company of
California, N.A., as independent fiduciary, and
acknowledged and agreed to by the LTV Controlled
Group.
(ii) Section 1.1(rr) is hereby amended by deleting
the word "and" immediately prior to clause (xi) thereof and
adding the following immediately prior to the period at the
end of Section 1.1(rr):
"; and (xii) any Lien on the ownership interests,
assets or property of the Trico Joint Venture or
any LTV Trico Entity or on the capital stock of
Trico Sales Co., in each case granted or created
in favor of any Person in accordance with the
Trico Transaction Documents"
SECTION 2. AMENDMENT to Definition of "Available Cash Flow"
-----------------------------------------------
The definition of "Available Cash Flow" set forth
in Section 5.4(f) of the Settlement Agreement is hereby
amended by adding the following new paragraph at the end of
such definition:
"A notional account (the "Trico Distributions Account")
shall be established which shall initially have a zero
balance and which shall be adjusted as follows. The
balance of the Trico Distributions Account shall be
increased (i) by the amount of any capital contribution
(or re-contribution) made by the LTV Trico Member to
the Trico Joint Venture at any time and (ii) by an
amount of interest accrued at a rate of 9.8% per annum
on the balance in such account on each day, which
amount shall be compounded monthly by being credited to
the Trico Distributions Account as of the end of each
calendar month. With respect to any cash amount
distributed (a "Trico Distribution") by the Trico Joint
Venture to the LTV Trico Member at any time, such Trico
Distribution shall first be applied to reduce the
balance of the Trico Distribution Account until such
account has a zero balance, and the remainder, if any,
5
<PAGE> 6
of the amount of such Trico Distribution shall be
included in "net cash provided by operating activities"
for purposes of the foregoing definition of "Available
Cash Flow" in the period in which such distribution is
received by the LTV Trico Member. Any contribution to
or distribution from the Trico Joint Venture shall only
be reflected in the computation of Available Cash Flow
to the extent provided in this paragraph."
SECTION 3. AMENDMENTS TO ARTICLE VI
------------------------
(i) Section 6.1 is hereby amended by adding after
the last sentence thereof the following:
"Notwithstanding the foregoing provisions of this
Section 6.1, the Guarantee Agreement to be
delivered by each LTV Trico Entity shall be
substantially in the form of Exhibit A hereto,
PROVIDED that such Guarantee Agreement to be
delivered by such LTV Trico Entity shall be (and
shall expressly state that it is) subject to the
Trico Subordination and Standstill Agreement".
(ii) Section 6.3 is hereby amended by adding after
the last sentence thereof the following:
"Notwithstanding the foregoing provisions of this
Section 6.3, the Guarantee Agreement to be
delivered by each LTV Trico Entity shall be
substantially in the form of Exhibit D hereto,
PROVIDED that such Guarantee Agreement to be
delivered by such LTV Trico Entity shall be (and
shall expressly state that it is) subject to the
Trico Subordination and Standstill Agreement".
SECTION 4. AMENDMENTS TO SECTION 8.1
-------------------------
(i) Section 8.1(a) is hereby amended by deleting
the word "and" immediately preceding clause (iv) and adding
the following immediately prior to the period at the end of
Section 8.1(a):
"; and (v) the Trico Joint Venture and each LTV
Trico Entity may sell, transfer, lease or
otherwise dispose of property and assets as
6
<PAGE> 7
contemplated by the Trico Transaction Documents as
in effect on the Sixth Amendment Effective Date"
(ii) Section 8.1(c) is hereby amended by adding
the following immediately prior to the period at the end of
Section 8.1(c):
"; PROVIDED that the agreements, obligations and
liabilities of each or any LTV Trico Entity under
this Section 8.1(c) shall be subject to the Trico
Subordination and Standstill Agreement"
(iii) Section 8.1(d) is hereby amended by adding
the following immediately prior to the period at the end of
Section 8.1(d):
"; and PROVIDED, FURTHER, that this Section 8.1(d)
shall not prohibit Trico Sales Co. from ceasing to
be a member of the LTV Controlled Group in the
manner contemplated by Section 3.05, 10.02, 15.04,
15.06 or 15.07 of the Amended and Restated Limited
Liability Company Agreement of the Trico Joint
Venture or Section 5.01 of the Trico Transaction
Agreement, each as in effect on the Sixth
Amendment Effective Date"
SECTION 5. AMENDMENTS TO SECTION 12.3
--------------------------
(i) The definition of "Permitted Indebtedness"
set forth in Section 12.3(c) is hereby amended by deleting
the word "and" immediately prior to clause (vii) thereof and
inserting a comma in its place and by adding the following
immediately prior to the period at the end of such
definition:
"and (viii) any Indebtedness under or contemplated
by any of the Trico Transaction Documents,
PROVIDED that, except for any LTV Trico Entity, no
member of the LTV Controlled Group may at any time
incur any Indebtedness under this clause (viii)
other than (x) the obligation of members of the
LTV Controlled Group under the Trico Transaction
Documents to re-contribute amounts to the Trico
Joint Venture at any time or from time to time up
to an aggregate of $20 million in respect of any
amount distributed by the Trico Joint Venture to
7
<PAGE> 8
the LTV Trico Member prior to such time and (y)
LTV's guaranty of the capital commitment of the
LTV Trico Member to the Trico Joint Venture under
the Trico Transaction Documents in an aggregate
amount up to $198 million,
(ii) Section 12.3(e) is hereby amended by adding
the following immediately prior to the period at the end of
Section 12.3(e):
"; and PROVIDED FURTHER, that this Section 12.3(e)
shall not apply to any transaction or series of
transactions contemplated by or in accordance with
the Supply and Marketing Agreement, the Services
Agreement or the Administrative Services Agreement
(each as defined in the Trico Transaction
Agreement and each as in effect on the Sixth
Amendment Effective Date)".
(iii) Section 12.3(f) is hereby amended by adding
the words "the Trico Transaction Documents (or any
amendments, modifications or supplements thereof to the
extent permitted under the definition of "Trico Transaction
Documents") or the Trico Subordination and Standstill
Agreement, which is incorporated in this Agreement by
reference as if set forth fully herein," immediately prior
to the words "the Sumitomo Agreement" in the proviso to
Section 12.3(f).
(iv) The following new clause (i) is hereby added
to Section 12.3 of the Settlement Agreement immediately
following Section 12.3(h):
"(i) LIMIT ON INVESTMENTS IN TRICO. At any time
after the Sixth Amendment Effective Date, make any
capital contribution to or equity investment in (each
such capital contribution or equity investment being a
"Trico Equity Investment"), or loan or advance to (each
such loan or advance, a "Trico Loan"; a Trico Loan or a
8
<PAGE> 9
Trico Equity Investment being referred to herein as a
"Trico Investment"), the Trico Joint Venture or Trico
Sales Co. if, after giving effect to such Trico
Investment, (i) the aggregate amount of such Trico
Investments then outstanding (net of equity
distributions) would exceed $300 million, (ii) the
aggregate amount of such Trico Equity Investments then
outstanding (net of equity distributions) would exceed
$250 million, or (iii) the aggregate amount of such
Trico Equity Investments then outstanding (net of
equity distributions) would exceed $200 million and the
Trico Equity Investment in question would not, to the
extent of such excess amount, be applied by the Trico
Joint Venture in respect of capital expenditures."
SECTION 6. AGREEMENT TO BE BOUND
---------------------
Subject to the Trico Subordination and Standstill
Agreement which is incorporated in this Sixth Amendment by
reference as if set forth fully herein, each LTV Trico
Entity hereby agrees to be bound by the Settlement Agreement
as a member of the LTV Controlled Group.
SECTION 7. EFFECTIVENESS AND MISCELLANEOUS PROVISIONS
------------------------------------------
A. EFFECTIVENESS. This Amendment shall become
effective upon the date (THE "SIXTH AMENDMENT EFFECTIVE
DATE") when (i) it, or a counterpart thereof, is executed by
a duly authorized officer of each of PBGC, LTV, the
Independent Fiduciary, and LTV Steel and (ii) the closing
under the Trico Transaction Agreement shall occur.
B. REFERENCE TO AND EFFECT
ON THE SETTLEMENT AGREEMENT.
(i) On and after the Sixth Amendment Effective
Date, each reference in the Settlement Agreement to "this
Agreement", "hereunder", "hereof", "herein" or words of like
9
<PAGE> 10
import referring to the Settlement Agreement shall mean and
be a reference to the Settlement Agreement as amended by
this Amendment.
(ii) Except as specifically amended by this
Amendment, the Settlement Agreement shall remain in full
force and effect.
C. APPLICABLE LAW. This Amendment shall be
interpreted in accordance with and governed by the laws of
the State of New York, except to the extent preempted by
federal law.
D. COUNTERPARTS. This Amendment may be executed
in any number of counterparts and by different parties
hereto in separate 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.
10
<PAGE> 11
IN WITNESS WHEREOF, the parties to this Amendment
have caused this Amendment to be duly executed and delivered
by their respective duly authorized officers or
representatives as of the day and year first written above.
PENSION BENEFIT GUARANTY
CORPORATION
By: /s/ ?
----------------------------------
Deputy Executive Director
Title: and Chief Negotiator
-------------------------------
Date: April 27, 1995
--------------------------------
THE LTV CORPORATION, on behalf
of itself and the LTV
Controlled Group
By: /s/ A. W. Huge
----------------------------------
Title: Senior Vice President
-------------------------------
Date: May 2, 1995
--------------------------------
11
<PAGE> 12
U.S. Trust Company of
California, N.A., as
Independent Fiduciary on
behalf of the Restored Plans
By: /s/ Norman P. Goldberg
------------------------------
Title: Senior Vice President
---------------------------
Date: April 27, 1995
----------------------------
LTV STEEL COMPANY, INC.
By: /s/ A. W. Huge
------------------------------
Title:
---------------------------
Date:
----------------------------
LTV-TRICO, INC.
By: /s/ A. W. Huge
------------------------------
Title: Vice President
------------------------------
Date: May 2, 1995
----------------------------
TRICO STEEL COMPANY, INC.
By: /s/ A. W. Huge
------------------------------
Title: Vice President
---------------------------
Date: May 2, 1995
----------------------------
12
<PAGE> 13
[EXECUTION COPY]
SEVENTH AMENDMENT TO
PBGC-LTV SETTLEMENT AGREEMENT
This Seventh Amendment to the PBGC-LTV Settlement
Agreement (this "AMENDMENT") is made as of August 2, 1995,
by and among (1) Pension Benefit Guaranty Corporation
("PBGC") and (2) The LTV Corporation, a corporation
organized under the laws of Delaware (in such capacity,
"LTV"), and each other member of the LTV Controlled Group
(as defined in the Settlement Agreement and listed on the
signature pages hereof), including, without limitation, LTV
Steel Company, Inc., a corporation organized under the laws
of New Jersey ("LTV STEEL"). Capitalized terms used without
definition herein shall have the same meanings as set forth
in the Settlement Agreement.
RECITALS
WHEREAS, on June 28, 1993, the PBGC, LTV, each
other member of the Initial LTV Group, and the Administrator
entered into the Settlement Agreement (the "SETTLEMENT
AGREEMENT");
WHEREAS, pursuant to Section 6.1 of the Settlement
Agreement, LTV Steel issued zero coupon notes to the PBGC,
each dated June 28, 1993, in the aggregate face amount of
$454,000,000, $50,000,000 aggregate face amount of which has
<PAGE> 14
been repurchased by the LTV Consolidated Group (the "Old
Notes") ; and
WHEREAS, LTV Steel desires to amend such notes to
(a) permit the payment of interest on the outstanding
principal amount of such notes from time to time
semiannually (i) in immediately available funds, (ii)
through the issuance of additional notes or (iii) partly in
immediately available funds and partly through the issuance
of additional notes and (b) permit the prepayment of such
notes, in whole or in part (subject to a minimum partial
prepayment requirement), at any time; and
WHEREAS, in order to effect such amendments, LTV
Steel desires to exchange the Old Notes for a promissory
note issued by LTV Steel to the PBGC, having an issue date
of June 30, 1995, in the aggregate principal amount of
$48,361,762.53 fully guaranteed by each member of the LTV
Controlled Group; and
WHEREAS, the Settlement Agreement authorizes the
amendment of that Agreement pursuant to an agreement entered
into by the PBGC and LTV evidenced by written instrument
signed by their authorized representatives; and
WHEREAS, subject to the terms and conditions
contained herein, the PBGC consents and is willing to agree
to such exchange and to certain related amendments to the
Settlement Agreement as provided below;
2
<PAGE> 15
NOW, THEREFORE, in consideration of the premises
and the agreements, provisions and covenants herein
contained, the parties hereto agree as follows:
SECTION 1. AMENDMENTS TO DEFINITIONS
-------------------------
From hereon, the defined term "Notes" in the
Settlement Agreement shall mean collectively (a) the
promissory note, having the issue date of June 30, 1995,
issued by LTV Steel to the PBGC, fully guaranteed by each
member of the LTV Controlled Group (pursuant to a Guarantee
Agreement dated the date hereof), in the aggregate principal
amount of $48,361,762.53 in exchange for the Old Notes and
(b) any additional notes issued from time to time pursuant
to the terms thereof. From hereon, the defined term "Note
Guarantee" in the Settlement Agreement shall mean such
Guarantee Agreement dated the date hereof and any new
Guarantee Agreement executed by the LTV Controlled Group in
connection with any transfer or assignment of such Notes or
issuance of additional Notes.
SECTION 2. AMENDMENTS TO ARTICLE VI
-------------------------
(i) Section 6.1 is hereby amended by replacing the
second sentence thereof with the following sentence:
"The Notes will be prepayable in whole or in part
(subject to a minimum partial prepayment
requirement) at the option of LTV Steel at any
time by paying to the payee thereof the amount of
such prepayment together with all accrued and
unpaid interest thereon."
3
<PAGE> 16
(ii) Section 6.1 is hereby further amended by
replacing the last sentence thereof with the following
sentence:
"The Old Notes will each be substantially in the
form attached hereto as Exhibit B."
SECTION 3. AMENDMENT TO SECTION 14.2(G)
----------------------------
Section 14.2(g) is hereby amended and restated in
its entirety as follows:
"(g) The PBGC may declare the principal
amount and all accrued and unpaid interest on all
Notes held by it to be immediately due and
payable, upon which declaration such principal
amount and all accrued and unpaid interest shall
become immediately due and payable without further
act or notice of any kind, except that in the case
of any Event of Default under paragraph (g) or (h)
of Article XIII, such principal amount and all
accrued and unpaid interest shall automatically
become due and payable without any declaration or
notice, if permitted under Applicable Law at the
time of such Event of Default; and the PBGC may
enforce all rights of action and rights to assert
claims under any of the Notes held by it, in each
case as set forth therein;"
SECTION 4. EFFECTIVENESS AND MISCELLANEOUS PROVISIONS
------------------------------------------
A. EFFECTIVENESS. This Amendment shall become
effective upon the date (THE "SEVENTH AMENDMENT EFFECTIVE
DATE") when (i) it, or a counterpart thereof, is executed by
a duly authorized officer of each of the PBGC, LTV and LTV
Steel and (ii) LTV Steel issues the Notes to the PBGC.
B. REFERENCE TO AND EFFECT ON
THE SETTLEMENT AGREEMENT.
(i) On and after the Seventh Amendment Effective
Date, each reference in the Settlement Agreement to "this
4
<PAGE> 17
Agreement", "hereunder", "hereof", "herein" or words of like
import referring to the Settlement Agreement shall mean and
be a reference to the Settlement Agreement as amended by
this Amendment.
(ii) Except as specifically amended by this
Amendment, the Settlement Agreement shall remain in full
force and effect.
C. APPLICABLE LAW. This Amendment shall be
interpreted in accordance with and governed by the law of
the State of New York, except to the extent preempted by
federal law.
D. COUNTERPARTS. This Amendment may be executed
in any number of counterparts and by different parties
hereto in separate 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.
5
<PAGE> 18
IN WITNESS WHEREOF, the parties to this Amendment
have caused this Amendment to be duly executed and delivered
by their respective duly authorized officers or
representatives as of the day and year first written above.
PENSION BENEFIT GUARANTY
CORPORATION
By: /s/ illegible
-------------------------------
Deputy Executive Director and
Title: Chief Negotiator
-----------------------------
Date: 8/3/95
------------------------------
THE LTV CORPORATION, on behalf
of itself and the other
members of the LTV Controlled
Group
By: /s/ J. C. Skurek
-------------------------------
Title: VP & Treasurer
-----------------------------
Date: 8/2/95
------------------------------
LTV STEEL COMPANY, INC.
By: /s/ J. C. Skurek
-------------------------------
Title: VP & Treasurer
-----------------------------
Date: 8/2/95
------------------------------
6
<PAGE> 1
<TABLE>
Page 1 of 2
Exhibit (11)
THE LTV CORPORATION
Calculation of Primary Earnings Per Share (EPS)
(Dollar amounts in millions except for EPS)
(Share data in thousands)
<CAPTION>
Three Months Ended September 30, Nine Months Ended September 30,
---------------------------------------------- ---------------------------------------------
1995 1994 1995 1994
---------------------- ---------------------- -------------------- -----------------------
Shares Amount EPS Shares Amount EPS Shares Amount EPS Shares Amount EPS
------- ------ ----- ------ ------ ------ ------- ------ ----- ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Income from continuing operations $ 43.2 $ 34.1 $158.7 $ 88.9
Preferred stock dividend requirements (0.6) (0.6) (1.7) (1.7)
------ ------ ------ ------
42.6 33.5 157.0 87.2
Share base:
Average Common Stock outstanding 105,359 92,575 105,359 91,932
Common Stock equivalent shares
resulting from outstanding
Series A Warrants,
Stock Options, Restricted
Stock and other 19 721 11 290
Common Stock issuable upon
conversion of Series B
Preferred Stock 2,926 0.6 2,926 0.6 2,926 1.7 2,926 1.7
------- ------ ------ ------ ------- ------ ------ ------
108,304 $ 43.2 96,222 $ 34.1 108,296 $158.7 95,148 $ 88.9
======= ====== ====== ====== ======= ====== ====== ======
PRIMARY EARNINGS (LOSS) PER SHARE:
Continuing operations $ 0.40 $ 0.35 $ 1.46 $ 0.93
Discontinued operations - - (0.08) (0.02)
------ ------ ------ ------
Net income $ 0.40 $ 0.35 $ 1.38 $ 0.91
====== ====== ====== ======
</TABLE>
<PAGE> 2
<TABLE>
Page 2 of 2
Exhibit (11)
THE LTV CORPORATION
Calculation of Fully Diluted Earnings Per Share (EPS)
(Dollar amounts in millions except for EPS)
(Share data in thousands)
Three Months Ended September 30, Nine Months Ended September 30,
---------------------------------------------- -----------------------------------------
1995 1994 1995 1994
---------------------- -------------------- -----------------------------------------
Shares Amount EPS Shares Amount EPS Shares Amount EPS Shares Amount EPS
------- ------- ---- ------- ------ ----- ------ ------ ---- ------ ------ -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Income from continuing operations $43.2 $34.1 $158.7 $88.9
Preferred stock dividend requirements (0.6) (0.6) (1.7) (1.7)
------ ------ ------ ------
42.6 33.5 157.0 87.2
Share base:
Average Common Stock outstanding 105,359 92,575 105,359 91,932
Common Stock equivalent shares
resulting from outstanding
Series A Warrants,
Stock Options, Restricted
Stock and other 19 1,165 14 1,099
Common Stock issuable upon
conversion of Series B
Preferred Stock 2,926 0.6 2,926 0.6 2,926 1.7 2,926 1.7
Common Stock issuable upon
conversion of Senior Secured
Convertible 5,128 1.3 5,128 1.3 5,128 3.8 5,128 3.9
------- ------ ------- ------ ------- ------ ------- -----
113,432 $44.5 101,794 $35.4 113,427 $162.5 101,085 $92.8
======= ====== ======= ====== ======= ====== ======= =====
FULLY DILUTED EARNINGS (LOSS) PER SHARE:
Continuing operations $0.39 $0.35 $1.44 $0.92
Discontinued operations - - (0.08) (0.02)
----- ----- ----- -----
Net income $0.39 $0.35 $1.36 $0.90
===== ===== ===== =====
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 267
<SECURITIES> 644
<RECEIVABLES> 458
<ALLOWANCES> 18
<INVENTORY> 774
<CURRENT-ASSETS> 2,141
<PP&E> 3,140
<DEPRECIATION> 469
<TOTAL-ASSETS> 5,594
<CURRENT-LIABILITIES> 1,044
<BONDS> 0
<COMMON> 53
0
1
<OTHER-SE> 1,446
<TOTAL-LIABILITY-AND-EQUITY> 5,594
<SALES> 3,238
<TOTAL-REVENUES> 3,238
<CGS> 2,722
<TOTAL-COSTS> 3,014
<OTHER-EXPENSES> (42)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 8
<INCOME-PRETAX> 258
<INCOME-TAX> 99
<INCOME-CONTINUING> 159
<DISCONTINUED> 9
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 150
<EPS-PRIMARY> 1.38
<EPS-DILUTED> 1.36
</TABLE>
