<PAGE>
- ----------------------------------------------------------------------------
- ----------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
-------------------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): April 7, 1994
-------------
Armco Inc.
------------------------------------------------
(Exact name of registrant as specified in charter)
Ohio 1-873-2 31-0200500
- -------------------------------- ----------- -------------
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation or organization) File Number) Identification No.)
One Oxford Centre, 301 Grant Street, Pittsburgh, Pennsylvania 15219-1415
- ------------------------------------------------------------- -----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 412/255-9800
------------
- ----------------------------------------------------------------------------
- ----------------------------------------------------------------------------
<PAGE>
Item 2. Acquisition or Disposition of Assets.
On April 7, 1994, Armco Steel Company, L.P. ("ASC"), a fifty percent owned
joint venture limited partnership between subsidiaries of Armco Inc.
("Armco") and Kawasaki Steel Corporation, completed an initial public
offering and recapitalization. As part of this transaction, the business
and assets of ASC were transferred to AK Steel Holding Corporation ("AK
Steel"), a newly formed, publicly traded company. In exchange for its
interest in ASC, Armco received 1,023,987 shares of stock in AK Steel with a
market value, based on the initial public offering price, of approximately
$24 million. The stock represents about four percent of the outstanding
shares immediately after the initial public offering. In addition, Armco
was released from certain obligations to make future cash payments to the
former joint venture. The exchange rate and other terms were determined by
arm's-length negotiations as part of the restructuring and recapitalization
of the former ASC joint venture.
As a result of the transaction, Armco expects to recognize nonrecurring
gains in the second quarter of 1994 totaling approximately $67 million, or
$.64 per share, primarily as a result of reversing the obligations discussed
above, recognizing deferred pension curtailment gains established at ASC's
formation and recording a tax benefit related to the effect of this
transaction on its deferred tax asset position.
Item 7. Financial Statements and Exhibits.
b. Pro forma financial information
The transaction involves the disposition of Armco's interest in ASC, a joint
venture accounted for as an equity investment. Because of the limited
number of pro forma adjustments, a narrative description of the pro forma
effects of the transaction is furnished in lieu of full pro forma financial
statements.
In 1993, cumulative losses reported by ASC resulted in a reduction of
Armco's investment in the joint venture to zero, after which Armco stopped
recording its equity in ASC's results. Had the transaction occurred as of
January 1, 1993, Armco's 1993 pro forma results of operations would have
benefited by $27.9 million, the share of the losses of ASC recorded by Armco
during 1993. Excluding these losses, Armco's 1993 net loss would have been
$613.9 million.
In addition, the pro forma balance sheet as of December 31, 1993 would have
reflected an increase of approximately $91 million in Armco's shareholders'
equity. $67 million of this increase would be in retained earnings
following the release from certain liabilities, the immediate recognition of
deferred pension gains established at ASC's formation and $30 million of tax
benefit related to the effect of this transaction on Armco's deferred tax
asset position. These adjustments would decrease noncurrent liabilities and
increase the noncurrent deferred tax asset. Shareholders' equity would also
increase approximately $24 million for unrealized gains on the 1,023,987
shares AK Steel stock received in the transaction. The $24 million
investment in this stock (based on the initial offering price of $23.50 per
share) would be recorded as a current asset available for sale.
c. Exhibits
2. Equity Exchange Agreement, dated as of March 29, 1994, between
AK Steel Holding Corporation, AK Steel Corporation, Armco Inc.,
AJV Investments Inc., Kawasaki Steel Investments, Inc. and
KSCA Incorporated.
-2-
<PAGE>
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 hereunto duly authorized.
ARMCO INC.
Date: April 21, 1994 By: /s/ Gary R. Hildreth
--------------------------------
Gary R. Hildreth
Vice President
-3-
<PAGE>
Exhibit 2
EQUITY EXCHANGE AGREEMENT
-------------------------
EQUITY EXCHANGE AGREEMENT, dated as of March 29, 1994 (this
"Agreement"), between AK Steel Holding Corporation, a Delaware corporation
("Holding"), AK Steel Corporation, a Delaware corporation ("AK Steel"),
Armco Inc., an Ohio corporation ("Armco"), AJV Investments Inc., a Delaware
corporation ("AJV"), Kawasaki Steel Investments, Inc., a Delaware
corporation ("KSIN"), and KSCA, Incorporated, a Delaware corporation (
"KSCA" ).
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the recapitalization plan (the
"Recapitalization" ) described in Holding's Registration Statement on Form
S-1 (No. 33-74432) filed on January 26, 1994 with the U. S. Securities and
Exchange Commission (the "Commission") and amended by Amendments No. 1, 2
and 3 filed with the Commission on March 10, 1994, March 25, 1994 and March
29, 1994, respectively (the "Registration Statement"), Holding proposes to
make an initial public offering (the "IPO") of its common stock, $.01 par
value ("Holding Common Stock"): and
WHEREAS, AK Steel, the sole general partner of Armco Steel
Company, L.P., a Delaware limited partnership (the "Partnership"), has
issued and outstanding (i) 100 shares of Class A Common Stock, $1.00 par
value (the "AKS Class A Shares"), all of which are owned by AJV, and (ii)
100 shares of Class K Common Stock, $1.00 par value (the "AKS Class K
Shares" and, collectively, with the AKS Class A Shares, the "AKS Shares"),
all of which are owned by KSCA; and
WHEREAS, each of Armco and KSIN owns a 49.5% limited
partnership interest in the Partnership; and
WHEREAS, in connection with the Recapitalization, (a) each of
AJV and KSCA will exchange all of its AKS Shares for shares of Holding
Common Stock, (b) each of Armco and KSIN will exchange its limited
partnership interest in the Partnership for shares of Holding Common Stock,
and (c) Holding will assign the entire limited partnership interest in the
Partnership to AK Steel (which will, by operation of law, accede to all the
assets and assume and succeed to all the liabilities of the Partnership and
will agree to
<PAGE>
indemnify Kawasaki Steel Corporation ("KSC"), Armco and their respective
affiliates against certain liabilities), all upon the terms and subject to
the conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
the parties hereto agree as follows:
1. Exchange of AKS Shares. (a) AJV agrees to
----------------------
assign and transfer to Holding 100 AKS Class A Shares, and Holding agrees to
accept such AKS Class A Shares from AJV and to issue and deliver to AJV
10,240 shares of Holding Common Stock in consideration therefor, subject to
adjustment (the "Price Adjustment") if the IPO price of the Holding Common
Stock is less than $21 per share or greater than $24 per share, as described
in the Registration Statement under the caption "Certain Relationships and
Related Transactions".
(b) KSCA agrees to assign and transfer to Holding 100 AKS
Class K Shares, and Holding agrees to accept such AKS Class K Shares from
KSCA and to issue and deliver to KSCA 10,240 shares of Holding Common Stock
in consideration therefor, subject to the Price Adjustment.
2. Exchange and Contribution of the Limited
----------------------------------------
Partnership Interests. (a) Armco agrees to assign and
- ---------------------
transfer to Holding Armco's 49.5% limited partnership interest in the
Partnership, and Holding agrees to accept from Armco and assume all of
Armco's obligations with respect to such limited partnership interest, and
to issue to Armco 1,013,697 shares of Holding Common Stock in consideration
therefor, subject to the Price Adjustment.
(b) KSIN agrees to assign and transfer to Holding KSIN's
49.5% limited partnership interest in the Partnership, and Holding agrees to
accept from KSIN and assume all of KSIN's obligations with respect to such
limited partnership interest, and to issue to KSIN 1,013,697 shares of
Holding Common Stock in consideration therefor, subject to the Price
Adjustment.
(c) Holding agrees to assign and transfer to AK Steel, and
AK Steel agrees to accept from Holding, and assume all of Holding's
obligations with respect to, the entire limited partnership interest in the
Partnership acquired by Holding from Armco and KSIN.
2
<PAGE>
3. Representations and Warranties of Holding.
------------------------------------------ Holding
hereby represents and warrants to Armco, AJV, KSIN and KSCA as follows:
(a) Holding is duly incorporated, validly existing and in
good standing under the laws of the State of Delaware, with full corporate
power and authority to enter into this Agreement and to perform its
obligations hereunder. The execution, delivery and performance of this
Agreement have been duly authorized by all necessary corporate action on the
part of Holding, and this Agreement constitutes the legal, valid and binding
obligation of Holding, enforceable against Holding in accordance with its
terms. The execution, delivery and performance of this Agreement by Holding
will not breach any applicable law or regulation of any governmental
authority, will not conflict with or result in a breach or default under any
of the terms, conditions or provisions of Holding's Certificate of
Incorporation or Bylaws, or any order, writ, injunction, agreement or
instrument by which Holding is bound, and will not result in the imposition
of any lien or encumbrance of any kind on the Holding Common Stock to be
issued pursuant hereto.
(b) The shares of Holding Common Stock to be issued to
Armco, AJV, KSIN and KSCA pursuant to this Agreement will, when so issued,
be duly authorized, validly issued, fully paid and non-assessable, free and
clear of any lien, claim or encumbrance (other than in respect of
limitations on transfer imposed by applicable securities laws).
(c) The Registration Statement (including any amendments
thereto filed with the Commission), as of its effective date and as of the
Closing (as defined below), will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not misleading.
(d) No broker, finder or investment banker is entitled to
any brokerage, finder's or other fee or commission from Holding in
connection with the exchanges contemplated by this Agreement.
4. Representations and Warranties of Armco, AJV,
---------------------------------------------
KSIN and KSCA. Each of Armco, AJV, KSIN and KSCA hereby
- -------------
represents and warrants to Holding, severally but not jointly, as follows:
(a) It is duly incorporated, validly existing and in good
standing under the laws of its state of incorpora-
3
<PAGE>
tion, with full corporate power and authority to enter into this Agreement
and to perform its obligations hereunder. The execution, delivery and
performance of this Agreement have been duly authorized by all necessary
corporate action on its part and this Agreement constitutes its legal, valid
and binding obligation, enforceable against it in accordance with its terms.
The execution, delivery and performance of this Agreement by it will not
breach any applicable law or regulation of any governmental authority, will
not conflict with or result in a breach or default under any of the terms,
conditions or provisions of its Certificate of Incorporation or Bylaws (or
other constitutional documents), or any order, writ, injunction, agreement
or instrument by which it is bound.
(b) It will transfer to Holding the AKS Class A Shares (in
the case of AJV), the AKS Class K Shares (in the case of KSCA), and the
limited partnership interests in the Partnership (in the case of Armco and
KSIN), free and clear of any lien, claim or encumbrance, other than in
respect of (i) limitations on transfer imposed by applicable securities laws
and (ii) in the case of the limited partnership interests, encumbrances on
transfer imposed by the Limited Partnership Agreement of the Partnership and
related documents which will be waived or terminated on or before the
Closing.
(c) It has reviewed the Registration Statement, has had
access to all other information relating to Holding which it has requested
and has such knowledge and experience in Holding's business that it is able
to evaluate fully the risks and merits of its investment in the shares of
Holding Common Stock.
(d) It is acquiring its shares of Holding Common Stock for
its own account and for investment purposes only, and it understands that
transfer of such shares of Holding Common Stock is restricted by applicable
securities laws and by the "lock-up" letter to be delivered by it or its
parent corporation to the underwriters for the IPO.
(e) No broker, finder or investment banker is entitled to
any brokerage, finder's or other fee or commission from it in connection
with the exchanges contemplated by this Agreement except such fees as will
be paid by it.
5. Representations and Warranties of AK Steel.
------------------------------------------
AK Steel hereby represents and warrants to Holding that it is duly
incorporated, validly existing and in good standing under the laws of the
State of Delaware, with full corporate power and authority to enter into
this Agreement and to
4
<PAGE>
perform its obligations hereunder. The execution, delivery and performance
of this Agreement have been duly authorized by all necessary corporate
action on the part of AK Steel, and this Agreement constitutes the legal,
valid and binding obligation of AK Steel, enforceable against AK Steel in
accordance with its terms. The execution, delivery and performance of this
Agreement by AK Steel will not breach any applicable law or regulation of
any governmental authority, will not conflict with or result in a breach or
default under any of the terms, conditions or provisions of AK Steel's
Certificate of Incorporation or Bylaws, or any order, writ, injunction,
agreement or instrument by which AK Steel is bound.
6. Actions at Closing. The closing of the
------------------
transactions contemplated hereby (the "Closing") will be held on or after
4:30 p.m. on the business day immediately preceding the closing date of the
IPO at the offices of Weil, Gotshal & Manges, New York, New York, or at such
other place and time as the parties may mutually agree. At the Closing, the
parties will take the following actions:
(a) Holding will deliver to:
(i) AJV a certificate or certificates for 10,240 shares
of Holding Common Stock (as the same may be adjusted pursuant to the Price
Adjustment), duly registered in the name of AJV or its nominee;
(ii) KSCA a certificate or certificates for 10,240
shares of Holding Common Stock (as the same may be adjusted pursuant to the
Price Adjustment), duly registered in the name of KSCA or its nominee;
(iii) Armco a certificate or certificates for 1,013,697
shares of Holding Common Stock (as the same may be adjusted pursuant to the
Price Adjustment), duly registered in the name of Armco or its nominee; and
(iv) KSIN a certificate or certificates for 1,013,697
shares of Holding Common Stock (as the same may be adjusted pursuant to the
Price Adjustment), duly registered in the name of or its nominee.
(b) AJV will deliver to Holding a certificate or
certificates for 100 AKS Class A Shares, duly endorsed in blank or
accompanied by stock powers executed in blank.
(c) KSCA will deliver to Holding a certificate or
certificates for 100 AKS Class K Shares, duly endorsed in blank or
accompanied by stock powers executed in blank.
5
<PAGE>
(d) Armco and Holding will execute an assignment and
assumption agreement pursuant to which Armco will transfer its limited
partnership interest in the Partnership to Holding, substantially in the
form of Exhibit A hereto with such changes therein as the parties hereto may
agree prior to the Closing.
(e) KSIN and Holding will execute an assignment and
assumption agreement pursuant to which KSIN will transfer its limited
partnership interest in the Partnership to Holding, substantially in the
form of Exhibit B hereto with such changes therein as the parties hereto may
agree prior to the Closing.
(f) Holding and AK Steel will execute an assignment and
assumption agreement pursuant to which Holding will transfer the entire
limited partnership interest in the Partnership to AK Steel, substantially
in the form of Exhibit C hereto with such changes therein as the parties
hereto may agree prior to the Closing.
(g) Holding, Armco, AJV, KSCA, KSIN and Kawasaki Steel
Holdings (USA), Inc. will enter into Registration Rights Agreements,
substantially in the form of Exhibit D hereto, with such changes therein as
the parties hereto may agree prior to the Closing.
(h) Holding will pay all transfer taxes and similar costs
incident to the delivery hereunder of the shares of Holding Common Stock,
the AKS Shares and the limited partnership interests in the Partnership.
7. Conditions. The obligations of each of the
----------
parties to consummate the transactions contemplated hereby shall be subject
to the fulfillment or waiver of the following conditions:
(a) All representations and warranties of the other parties
shall have been true when made and shall be true in all material respects at
the Closing as if then made.
(b) The other parties shall have performed all of their
obligations hereunder to be performed at or prior to the Closing.
(c) All necessary government filings (including without
limitation those under applicable securities laws and the Hart-Scott-Rodino
Antitrust Improvements Act) shall have been made, all necessary consents of
governmental
6
<PAGE>
agencies and other third parties shall have been obtained and all applicable
waiting periods shall have expired.
(d) The Registration Statement (including any amendments
thereto filed with the Commission) shall have been declared effective under
the Securities Act of 1933, as amended, and no stop order suspending the
effectiveness of the Registration Statement (as amended) or suspending or
preventing the use of the related prospectus shall be in effect and no
proceedings for that purpose shall have been instituted or, to the best of
Holding's knowledge, be pending or contemplated by the Commission.
(e) Each of the U.S. Underwriting Agreement and the
Subscription Agreement (as defined in the Registration Statement) and the
Underwriting Agreement with respect to the Senior Notes (as defined in the
Registration Statement) shall have been executed and delivered by the
parties thereto, and no event shall have occurred and be continuing that
would cause any conditions precedent under any such agreement or the Equity-
Indebtedness Exchange Agreement of even date herewith among Holding, AK
Steel and Kawasaki Steel International (USA) Inc. not to be satisfied, and
each such agreement shall continue to be in full force and effect.
(f) There shall be no actions, proceedings or investigations
pending or, to the best of Holding's knowledge, threatened against or
affecting Holding seeking to enjoin, restrain or otherwise prevent
consummation of the Recapitalization.
8. Miscellaneous.
-------------
(a) Effectiveness. This Agreement shall become
-------------
effective upon its execution by each of the parties hereto. This Agreement
shall terminate and be null and void if the transactions contemplated hereby
are not consummated on or before April 30, 1994. This Agreement is
conditioned upon the initial public offering price in the IPO of the Holding
Common Stock being not less than $21 per share and not greater than $24 per
share.
(b) Severability. If any term, provision, cove-
------------
nant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, void, or unenforceable, the remainder of the
terms, provisions, covenants and restrictions shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
(c) Governing Law. This Agreement shall be
-------------
governed by, and construed in accordance with, the laws of
7
<PAGE>
the State of New York, without giving effect to the conflict of law
principles thereunder.
(d) Amendments. This Agreement may be amended,
----------
changed, modified, waived, discharged or terminated only by an agreement in
writing signed on behalf of each of the parties hereto.
(e) Successors and Assigns. This Agreement shall
----------------------
be binding on, inure to the benefit of, and be enforceable by, the parties
hereto and their respective successors and assigns, provided that no party
may assign, delegate or otherwise transfer any of its rights or obligations
under this Agreement without the written consent of the other parties.
(f) Entire Agreement. This Agreement contains
----------------
the entire understanding of the parties with respect to the transactions
contemplated hereby. This agreement supersedes all prior agreements and
understandings among any of the parties hereto with respect to its subject
matter.
(g) Descriptive Headings. The descriptive
---------------------
headings are for convenience only and shall not control or affect the
meaning or construction of any provision of this Agreement.
(h) Counterparts. This Agreement may be executed
------------
in counterparts, each of which shall be deemed an original and all of which,
together, shall constitute one and the same instrument.
(i) Further Assurances. Each party hereto will
------------------
execute and deliver such other documents and perform such other acts as
another party may reasonably request to carry out the intent of this
Agreement.
8
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first above written.
AK Steel Holding Corporation
By: /s/ Randall F. Preheim
-------------------------
Name: Randall F. Preheim
Title: Vice President
AK Steel Corporation
By: /s/ Randall F. Preheim
-------------------------
Name: Randall F. Preheim
Title: Vice President
Armco Inc.
By: /s/ Gary R. Hildreth
-------------------------
Name: Gary R. Hildreth
Title: Vice President
AJV Investments, Inc.
By: /s/ Gary R. Hildreth
-------------------------
Name: Gary R. Hildreth
Title: Vice President
Kawasaki Steel Investments, Inc.
By: /s/ Tsukano K.
-------------------------
Name: Tsukano K.
Title: Vice President
KSCA, Inc.
By: /s/ Kensuke Horiuchi
-------------------------
Name: Kensuke Horiuchi
Title: President
9
<PAGE>
LIMITED PARTNERSHIP INTEREST
ASSIGNMENT AND ASSUMPTION AGREEMENT
-----------------------------------
LIMITED PARTNERSHIP INTEREST ASSIGNMENT AND ASSUMPTION AGREEMENT,
dated as of April 6, 1994, between Armco Inc., an Ohio corporation (the
"Assignor"), AK Steel Holding Corporation, a Delaware corporation (the
"Assignee"), and Armco Steel Company, L.P., a Delaware limited partnership
(the "Partnership").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the recapitalization plan (the
"Recapitalization") described in the Assignee's Registration Statement on
Form S-l (No. 33-74432) filed on January 26, 1994 with the U.S. Securities
and Exchange Commission, as amended, the Assignee proposes to make an
initial public offering of its common stock, $.0l par value ("Common
Stock"); and
WHEREAS, pursuant to an Equity Exchange Agreement (the "Equity
Exchange Agreement"), dated as of March 29, 1994, between the Assignor, the
Assignee, AK Steel Corporation ("AK Steel"), AJV Investments Inc., Kawasaki
Steel Investments, Inc. and KSCA Incorporated, the Assignor desires to
assign its 49.5% limited partnership interest in the Partnership to the
Assignee, and the Assignee desires to
<PAGE>
accept such limited partnership interest from the Assignor and assume the
Assignor's obligations with respect thereto;
NOW, THEREFORE, pursuant to the Equity Exchange Agreement, in
consideration of the premises and the mutual covenants contained herein and
therein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Assignment. Subject to the terms and
----------
provisions contained herein and in the Equity Exchange Agreement, the
Assignor hereby assigns and transfers to the Assignee, the Assignee hereby
accepts from the Assignor, and assumes all of Assignor's obligations with
respect to, the Assignor's 49.5% limited partnership interest in the
Partnership, and the Partnership releases the Assignor from all of its
obligations with respect to its limited partnership interest in the
Partnership. Nothing herein is intended to impair rights and obligations
intended to survive after the Recapitalization pursuant to that certain
Joint Venture Termination Agreement dated as of April 6, 1994 (the "Joint
Venture Termination Agreement").
2. Consideration. In consideration for the
--------------
assignment described in Section 1 above, the Assignee hereby
<PAGE>
issues and delivers to the Assignor 1,013,697 shares of Holding Common
Stock.
3. Effectiveness. This Agreement shall become
-------------
effective upon execution by each of the parties hereto.
4. Severability. If any term, provisions
------------
covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, void, or unenforceable, the remainder of the
terms, provisions, covenants and restrictions shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
5. Governing Law. This Agreement shall be
-------------
governed by, and construed in accordance with, the laws of the State of New
York, without giving effect to the conflict of laws principles thereunder.
6. Amendments. This Agreement may be amended,
----------
changed, modified, waived, discharged or terminated only by an agreement in
writing signed on behalf of each of the parties hereto.
7. Successors and Assigns. This Agreement shall
----------------------
be binding on, inure to the benefit of, and be enforceable by, the parties
hereto and their respective successors and assigns, provided that no party
may assign, delegate or otherwise transfer any of its rights or obligations
under
<PAGE>
this Agreement without the written consent of the other parties, except that
any party may assign its rights hereunder to any successor to all or
substantially all of its assets and business, but any such assignment shall
not relieve such party of its obligations hereunder.
8. Entire Agreement. This Agreement, together
----------------
with the Equity Exchange Agreement, the Joint Venture Termination Agreement
and the Indemnification Agreement, dated as of the date hereof, between the
Assignee, AK Steel and the Assignor, contain the entire understanding of the
parties with respect to the transactions contemplated hereby and supersede
all prior agreements and understandings among any of the parties hereto with
respect to their subject matter.
9. Descriptive Headings. The descriptive
--------------------
headings are for convenience only and shall not control or affect the
meaning or construction of any provision of this Agreement.
10. Counterparts. This Agreement may be executed
------------
in counterparts, each of which shall be deemed an original and all of which,
together, shall constitute one and the same instrument.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed as of the date first above written.
AK STEEL HOLDING CORPORATION
By:-----------------------------
Name:
Title:
ARMCO INC.
By:-----------------------------
Name:
Title:
ARMCO STEEL COMPANY, L.P.,
by AK Steel Corporation,
its general partner
By:-----------------------------
Name:
Title:
<PAGE>
LIMITED PARTNERSHIP INTEREST
ASSIGNMENT AND ASSUMPTION AGREEMENT
-----------------------------------
LIMITED PARTNERSHIP INTEREST ASSIGNMENT AND ASSUMPTION
AGREEMENT, dated as of April 6, 1994, between Kawasaki Steel Investments,
Inc., a Delaware corporation (the "Assignor"), AK Steel Holding Corporation,
a Delaware corporation (the "Assignee"), and Armco Steel Company, L.P., a
Delaware limited partnership (the "Partnership").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the recapitalization plan (the
"Recapitalization") described in the Assignee's Registration Statement on
Form S-1 (No. 33-74432) filed on January 26, 1994 with the U.S. Securities
and Exchange Commission, as amended, the Assignee proposes to make an
initial public offering of its common stock, $.01 par value ("Holding Common
Stock"); and
WHEREAS, pursuant to an Equity Exchange Agreement (the "Equity
Exchange Agreement"), dated as of March 29, 1994, between the Assignor, the
Assignee, AK Steel Corporation ("AK Steel"), AJV Investments Inc., Armco
Inc. and KSCA Incorporated, the Assignor desires to assign its 49.5% limited
partnership interest in the Partnership to the
<PAGE>
Assignee, and the Assignee desires to accept such limited partnership
interest from the Assignor and assume the Assignor's obligations with
respect thereto;
NOW, THEREFORE, pursuant to the Equity Exchange Agreement, in
consideration of the premises and the mutual covenants contained herein and
therein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Assignment. Subject to the terms and
----------
provisions contained herein and in the Equity Exchange Agreement, the
Assignor hereby assigns and transfers to the Assignee, the Assignee hereby
accepts from the Assignor, and assumes all of Assignor's obligations with
respect to, the Assignor's 49.5% limited partnership interest in the
Partnership, and the Partnership releases the Assignor from all of its
obligations with respect to its limited partnership interest in the
Partnership. Nothing herein is intended to impair rights and obligations
intended to survive after the Recapitalization pursuant to that certain
Joint Venture Termination Agreement dated as of April 6, 1994 (the "Joint
Venture Termination Agreement").
2. Consideration. In consideration for the
-------------
assignment described in Section 1 above, the Assignee hereby
2
<PAGE>
issues and delivers to the Assignor 1,013,697 shares of Holding Common
Stock.
3. Effectiveness. This Agreement shall become
-------------
effective upon execution by each of the parties hereto.
4. Severability. If any term, provisions
------------
covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, void, or unenforceable, the remainder of the
terms, provisions, covenants and restrictions shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
5. Governing Law. This Agreement shall be
-------------
governed by, and construed in accordance with, the laws of the State of New
York, without giving effect to the conflict of laws principles thereunder.
6. Amendments. This Agreement may be amended,
----------
changed, modified, waived, discharged or terminated only by an agreement in
writing signed on behalf of each of the parties hereto.
7. Successors and Assigns. This Agreement shall
----------------------
be binding on, inure to the benefit of, and be enforceable by, the parties
hereto and their respective successors and assigns, provided that no party
may assign, delegate or otherwise transfer any of its rights or obligations
under
3
<PAGE>
this Agreement without the written consent of the other parties, except that
any party may assign its rights hereunder to any successor to all or
substantially all of its assets and business, but any such assignment shall
not relieve such party of its obligations hereunder.
8. Entire Agreement. This Agreement, together
----------------
with the Equity Exchange Agreement, the Joint Venture Termination Agreement
and the Indemnification Agreement, dated as of the date hereof, between the
Assignee, AK Steel and Armco Inc., contain the entire understanding of the
parties with respect to the transactions contemplated hereby and supersede
all prior agreements and understandings among any of the parties hereto with
respect to their subject matter.
9. Descriptive Headings. The descriptive
--------------------
headings are for convenience only and shall not control or affect the
meaning or construction of any provision of this Agreement.
10. Counterparts. This Agreement may be executed
------------
in counterparts, each of which shall be deemed an original and all of which,
together, shall constitute one and the same instrument.
4
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed as of the date first above written.
AK STEEL HOLDING CORPORATION
By: /s/ Randall F. Preheim
-----------------------
Name: Randall F. Preheim
Title: Vice President
KAWASAKI STEEL INVESTMENTS, INC.
By: /s/ Tsukano K.
-----------------------------
Name: Tsukano K.
Title: Vice President
ARMCO STEEL COMPANY, L.P.,
by AK Steel Corporation,
its general partner
By:/s/ Randall F. Preheim
------------------------------
Name: Randall F. Preheim
Title: Vice President
5
<PAGE>
LIMITED PARTNERSHIP INTEREST
ASSIGNMENT AND ASSUMPTION AGREEMENT
-----------------------------------
LIMITED PARTNERSHIP INTEREST ASSIGNMENT AND ASSUMPTION
AGREEMENT, dated as of April 6, 1994, between AK Steel Holding Corporation,
a Delaware corporation (the "Assignor"), AK Steel Corporation, a Delaware
corporation and a wholly-owned subsidiary of the Assignor (the "Assignee"),
and Armco Steel Company, L.P., a Delaware limited partnership (the
"Partnership").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to an Equity Exchange Agreement (the "Equity
Exchange Agreement"), dated as of March 29, 1994, between the Assignor, the
Assignee, Armco Inc., AJV Investments Inc., Kawasaki Steel Investments, Inc.
and KSCA Incorporated, the Assignor is the owner of the entire limited
partnership interest in the Partnership; and
WHEREAS, in connection with the Recapitalization referred to in
the Equity Exchange Agreement, the Assignor desires to assign its limited
partnership interest in the Partnership to the Assignee, and the Assignee
desires to accept such limited partnership interest from the Assignor and
assume the Assignor's obligations with respect thereto;
<PAGE>
NOW, THEREFORE, pursuant to the Equity Exchange Agreement, in
consideration of the premises and the mutual covenants contained herein and
therein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Assignment. Subject to the terms and
----------
provisions contained herein and the Equity Exchange Agreement, the Assignor
hereby assigns and transfers to the Assignee, the Assignee hereby accepts
from the Assignor, and assumes all of Assignor's obligations with respect
to, the Assignor's limited partnership interest in the Partnership, and the
Partnership releases the Assignor from all of its obligations with respect
to its limited partnership interest in the Partnership. Nothing herein is
intended to impair rights and obligations intended to survive after the
Recapitalization pursuant to that certain Joint Venture Termination
Agreement dated as of April 6, 1994 (the "Joint Venture Termination
Agreement").
2. Effectiveness. This Agreement shall become
-------------
effective upon execution by each of the parties hereto.
3. Severability. If any term, provisions
-------------
covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, void, or unenforceable, the remainder of the
terms, provisions, covenants and restrictions shall remain in full force and
2
<PAGE>
effect and shall in no way be affected, impaired or invalidated.
4. Governing Law. This Agreement shall be
-------------
governed by, and construed in accordance with, the laws of the State of New
York, without giving effect to the conflict of laws principles thereunder.
5. Amendments. This Agreement may be amended,
----------
changed, modified, waived, discharged or terminated only by an agreement in
writing signed on behalf of each of the parties hereto.
6. Successors and Assigns. This Agreement shall
----------------------
be binding on, inure to the benefit of, and be enforceable by, the parties
hereto and their respective successors and assigns, provided that no party
may assign, delegate or otherwise transfer any of its rights or obligations
under this Agreement without the written consent of the other parties,
except that any party may assign its rights hereunder to any successor to
all or substantially all its assets and business, but any such arrangement
shall not relieve such party of its obligations hereunder.
7. Entire Agreement. This Agreement, together
----------------
with the Equity Exchange Agreement, the Joint Venture Termination Agreement
and the Indemnification Agreement, dated as of the date hereof, between the
Assignee, Armco Inc. and the Assignor, contain the entire understanding of
the parties with respect to the transactions contemplated
3
<PAGE>
hereby and supersede all prior agreements and understandings among any of
the parties hereto with respect to their subject matter.
8. Descriptive Headings. The descriptive
--------------------
headings are for convenience only and shall not control or affect the
meaning or construction of any provision of this Agreement.
9. Counterparts. This Agreement may be executed
------------
in counterparts, each of which shall be deemed an original and all of which,
together, shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first above written.
AK STEEL HOLDING CORPORATION
By: /s/ Randall F. Preheim
-----------------------
Name: Randall F. Preheim
Title: Vice President
AK STEEL CORPORATION
By: /s/ Randall F. Preheim
-------------------------
Name: Randall F. Preheim
Title: Vice President
ARMCO STEEL COMPANY, L.P.,
by AK Steel Corporation,
its general partner
By: /s/ Randall F. Preheim
------------------------------
Name: Randall F. Preheim
Title: Vice President
4
<PAGE>
FORM OF REGISTRATION RIGHTS AGREEMENT
Registration Rights Agreement dated as of April 7, 1994, among AK
Steel Holding Corporation, a Delaware corporation (the "Company"), and Armco
Inc., an Ohio corporation ("Armco"), and AJV Investments Corp., a Delaware
corporation ("AJV").
For valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties agree as follows:
1. Definitions
-----------
"Commission" means the Securities and Exchange
----------
Commission.
"Common Stock" means common stock, par value $.01
------------
per share, of the Company.
"Equity Exchange Agreement Shares" means the
--------------------------------
1,023,937 shares of Common Stock issued to Armco and AJV pursuant to the
Equity Exchange Agreement dated as of March 29, l994, among the Company, AK
Steel Corporation, Armco, AJV, Kawasaki Steel Investments, Inc. ("KSIN") and
KSCA, Incorporated ("KSCA").
"Exchange Act" means the Securities Exchange Act
------------
of 1934, as amended.
"Holder" means the Purchaser of any Registrable
------
Security or any assignee or transferee of such Registrable Security unless
such Registrable Security is acquired in a public distribution pursuant to a
Registration Statement under the Securities Act or pursuant to transactions
exempt from registration under the Securities Act where securities sold in
such transaction may be resold without subsequent registration under the
Securities Act.
"Holders' Representative" means Armco and such
-----------------------
Person as Armco may have assigned its rights hereunder as Holders'
representative and as may have been noticed by Armco to the Company.
"IPO Date" means the closing date of the
--------
Company's initial public offering of Common Stock.
"Person" means an individual, partnership, corpo-
------
ration, trust or unincorporated organization, or a government or agency or
political subdivision thereof.
"Prospectus" means the prospectus included in any
----------
Registration Statement, as amended or supplemented by any
<PAGE>
prospectus supplement with respect to the terms of the offering of any
portion of the Registrable Securities covered by the Registration Statement
and by all other amendments and supplements to the prospectus, including
post-effective amendments and all material incorporated by reference in such
prospectus.
"Purchaser" or "Purchasers" means collectively,
--------- ----------
Armco and AJV.
"Recapitalization" means the recapitalization
----------------
plan described in the Company's Registration Statement on Form S-l
(Registration No. 33-74432).
"Registrable Securities" means the Equity Ex-
----------------------
change Agreement Shares and the 50 shares of Common Stock issuable to Armco
upon incorporation and initial capitalization of the Company and any
securities issued or issuable with respect to any of such shares of Common
Stock (x) by way of stock split, stock dividend or other distribution (y) in
connection with a combination of shares, recapitalization, merger,
consolidation or other reorganization or (z) in any other way. Any
Registrable Security will cease to be a Registrable Security when (i) a
Registration Statement covering such Registrable Security has been declared
effective by the Commission and it has been disposed of or purchased, as the
case may be, pursuant to such effective Registration Statement, (ii) it is
sold under circumstances in which all of the applicable conditions of Rule
144 (or any similar provisions then in force) under the Securities Act are
met or it may be sold pursuant to Rule 144(k) under the Securities Act or
(iii) it has been otherwise transferred, the Company has delivered a new
certificate or other evidence of ownership for it not bearing a legend and
it may be resold without subsequent registration under the Securities Act.
"Registration Expenses" has the meaning set forth
---------------------
in Section 6.
"Registration Statement" means any registration
----------------------
statement of the Company, including the Prospectus, amendments and
supplements to such Registration Statement, including post- effective
amendments, and all exhibits and all material incorporated by reference in
such Registration Statement, which relates to Registrable Securities.
"Securities Act" means the Securities Act of
-------------
1933, as amended.
"Selling Holder" means a Holder who is selling
--------------
Registrable Securities pursuant to a Registration Statement.
-2-
<PAGE>
"Shelf Registration" means the shelf registration
------------------
statement filed by the Company in accordance with Section 2(a)(i) hereof.
"Underwriter" means a securities dealer which
-----------
purchases any Registrable Securities as principal and not as part of such
dealer's market-making activities.
2. Shelf Registrations
-------------------
(a) (i) The Company will use its best efforts to file a "shelf"
registration statement with respect to the Registrable Securities on an
appropriate form pursuant to Rule 415 (or any similar provision that may be
adopted by the Commission) under the Securities Act (the "Shelf
Registration") within 120 days after the IPO Date, which Shelf Registration
may include shares of Common Stock owned by KSIN, KSCA, Kawasaki Steel
Holdings (USA), Inc. and any other Person agreed to by the parties hereto.
(ii) The Company agrees to use its best efforts to have the Shelf
Registration declared effective no later than 180 days after the IPO Date
and to keep the Shelf Registration continuously effective until the earlier
of (i) the sixth anniversary of the IPO Date and (ii) the first date there
shall be no remaining Registrable Securities (including by reason of the
fact that all Registrable Securities may be sold pursuant to Rule 144(k)
under the Securities Act). The Company will pay all Registration Expenses in
connection with the Shelf Registration, whether or not it becomes effective.
The Company will make generally available to its security holders, as soon
as reasonably practicable after the end of the fourth fiscal quarter
following the fiscal quarter that includes such effective date, an earnings
statement covering a period of at least 12 months which shall satisfy the
provisions of Section 11(a) of the Securities Act.
(b) Selection of Underwriters. If at any time or
-------------------------
from time to time any of the Holders desire to sell Registrable Securities
in an underwritten offering (other than pursuant to Section 3 hereof), the
investment banker or investment bankers and manager or managers that will
administer the offering will be selected by the Holders' Representative.
3. Piggy-Back Registrations
------------------------
(a) If at any time on or after the 180th day after the IPO Date, the
Company proposes to file a registration statement under the Securities Act
with respect to an underwritten offering of shares of its Common Stock,
whether or not for sale for its own account (other than a registration
statement on Form S-4 or S-8, or any substitute form
-3-
<PAGE>
that may be adopted by the Commission or a registration filed, or filed in
connection with an exchange offer or offering of securities solely to the
Company's existing security holders), the Company shall give written notice
of such proposed filing to Holders' Representative as soon as practicable
(but in no event less than 30 days before the anticipated filing date), and
the Holders shall have the right, exercisable by notice to the Company to be
given by Holders' Representative within 30 days after the giving of such
notice by the Company, to have included within the coverage of the
registration statement such amount of Registrable Securities as Holders'
Representative may request, subject to Section 3(b) below.
(b) The Company shall use reasonable efforts to cause the managing
Underwriter or Underwriters of a proposed underwritten offering to permit
the Registrable Securities requested to be included in the registration
statement for such offering to be included on the same terms and conditions
as any similar securities of the Company or of other security holders to be
included therein. If, notwithstanding the reasonable efforts of the Company,
the managing Underwriter or Underwriters of such offering deliver a written
opinion to Holders' Representative that, due to the size of the offering
which the Holders, the Company and such other persons intend to make, the
success of the offering would be materially and adversely affected by
inclusion of the Registrable Securities requested to be included, then the
amount of securities to be offered for the accounts of Holders shall be
reduced pro rata (according to the Registrable Securities proposed for
registration) to the extent necessary to reduce the total Amount of
securities to be included in such offering to the amount recommended by such
managing Underwriters; provided that if
--------
securities are
being offered for the account of other security holders, then the proportion
by which the amount of such class of securities intended to be offered by
the Holders is reduced shall not exceed the proportion by which the amount
of the securities intended to be offered by such other security holders is
reduced.
4. Hold-Back Agreements
--------------------
(a) Restrictions on Public Sale by Holder of Regis-
-----------------------------------------------
trable Securities. Each Holder, if requested by the manag-
- -----------------
ing Underwriters in an underwritten offering of Common Stock of the Company
(whether or not any Registrable Securities of any such Holder are included
in such offering), agrees not to effect any public sale or distribution of
the Registrable Securities, including a sale pursuant to Rule 144 under the
Securities Act (except as part of such underwritten offering), during the
10-day period prior to, and during a period of up to 90 days beginning on
the closing date of such underwritten offering, to the extent timely
-4-
<PAGE>
notified in writing by the Company or the managing Underwriters.
(b) Restrictions on Public Sale by the Company and Others.
----------------------------------------------------
The Company agrees:
(l) not to effect any public or private sale or distribution of
its equity securities, including a sale pursuant to Regulation D under the
Securities Act, during the 10-day period prior to, and during a period of up
to 90 days beginning on, the closing date of each underwritten offering made
pursuant to a Registration Statement filed under Section 2 or Section 3, to
the extent timely requested in writing by the managing Underwriters (except
as part of such underwritten registration or pursuant to registrations on
Forms S-4 or S-8 or any successor form to such Forms), and
(2) if reasonably requested by Holders' Representative or the
managing Underwriters in connection with an underwritten offering of Common
Stock of the Company, to use reasonable efforts to cause each holder of
privately placed equity securities issued by the Company at any time on or
after the date of this Agreement (other than the Trustee of the AK Steel
Corporation Master Pension Trust) to agree not to effect any public sale or
distribution of any such securities during such period, including a sale
pursuant to Rule 144 under the Securities Act (except as part of such
underwritten registration, if permitted).
5. Registration Procedures
-----------------------
In connection with the Company's obligations to file a Registration
Statement pursuant to Sections 2 or 3 hereof, the Company will use its best
efforts to effect such registration to permit the sale of such Registrable
Securities covered thereby in accordance with the intended method of
disposition thereof, and in connection therewith the Company will as
expeditiously as possible:
(a) before filing the Registration Statement or Prospectus or any
amendments or supplements thereto, furnish to Holders' Representative and
the Underwriters, if any, copies of all such documents proposed to be filed,
which documents will be subject to the review of the Selling Holders and
Underwriters, and the Company will not file the Registration Statement or
amendment thereto or any Prospectus or any supplement thereto to which
Holders' Representative or the Underwriters, if any, shall reasonably
object;
-5-
<PAGE>
(b) prepare and file with the Commission such amendments and post-
effective amendments to the Registration Statement, and such supplements to
the Prospectus, as may be requested by any Holders' Representative or any
Underwriter of Registrable Securities, and as may be required by the rules,
regulations or instructions applicable to the registration form utilized by
the Company or by the Securities Act or rules and regulations thereunder
(including the rules for shelf registration), or as may otherwise be
necessary to keep the Registration Statement effective for the applicable
period and cause the Prospectus as so supplemented to be filed with the
Commission pursuant to Rule 424 under the Securities Act; and comply with
the provisions of the Securities Act with respect to the disposition of all
securities covered by such Registration Statement during the applicable
period in accordance with the intended methods of disposition by the sellers
thereof set forth in such Registration Statement or supplement to the
Prospectus;
(c) notify the Holders' Representative and the managing Underwriters,
if any, promptly, and (if requested by any such Person) confirm such advice
in writing,
(l) when the Prospectus or any Prospectus supplement or post-
effective amendment has been filed, and, with respect to the Registration
Statement or any post-effective amendment, when the same has become
effective,
(2) of any request by the Commission for amendments or
supplements to the Registration Statement or the Prospectus or for
additional information,
(3) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the initiation
of any proceedings for that purpose,
(4) prior to the closing of an underwritten offering if at any
time the representations and warranties of the Company contemplated by
paragraph (m) below, cease to be true and correct,
(5) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Registrable Securities
for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose, and
-6-
<PAGE>
(6) of the existence of any fact which results in the
Registration Statement, the Prospectus or any document incorporated therein
by reference containing an untrue statement of material fact or omitting to
state a material fact required to be stated therein or necessary to make the
statements therein (in light of the circumstances under which they were
made, in the case of the Prospectus) not misleading;
(d) make all reasonable efforts to obtain the withdrawal of any order
suspending the effectiveness of the Registration Statement at the earliest
possible moment;
(e) if requested by the managing Underwriter or Underwriters or
Holders' Representative, immediately incorporate in a Prospectus supplement
or post-effective amendment such information as the managing Underwriters
and Holders' Representative agree should be included therein relating to the
plan of distribution with respect to such Registrable Securities or change
thereof, including, without limitation information with respect to the
amount of Registrable Securities being sold to such Underwriters, the
purchase price being paid therefor by such Underwriters and with respect to
any other terms of the Underwritten (or best efforts underwritten) offering
of the Registrable Securities to be sold in such offering; and make all
required filings of such Prospectus supplement or post-effective amendment
as soon as notified of the matters to be incorporated in such Prospectus
supplement or post-effective amendment;
(f) furnish to Holders' Representative and each Selling Holder and
each managing Underwriter (if any), without charge, at least one signed copy
of the Registration Statement and any post-effective amendment thereto,
including financial statements and schedules, all documents incorporated
therein by reference and all exhibits (including those incorporated by
reference);
(g) deliver to each Selling Holder and the Underwriters, if any,
without charge, as many copies of the Prospectus (including each preliminary
prospectus) and any amendment or supplement thereto as such Persons may
reasonably request; the Company consents to the use of the Prospectus or any
amendment or supplement thereto by each of the Selling Holders and the
Underwriters, if any, in connection with the offering and sale of the
Registrable Securities covered by the Prospectus or any amendment or
supplement thereto in
-7-
<PAGE>
the manner contemplated by the Prospectus or any such amendment or
supplement;
(h) prior to any public offering of Registrable Securities, register
or qualify or cooperate with Holders' Representative, the Selling Holders,
the Underwriters, if any, and their respective counsel in connection with
the registration or qualification of such Registrable Securities for offer
and sale under the securities or blue sky laws of such jurisdictions as
Holders' Representative or any Underwriter reasonably requests in writing
and do any and all other acts or things reasonably necessary or advisable to
enable the disposition in such jurisdictions of the Registrable Securities
covered by the Registration Statement; provided that the Company will not be
--------
required to qualify
generally to do business in any jurisdiction where it is not then so
qualified or to take any action which would subject it to general service of
process in any such jurisdiction where it is not then so subject;
(i) cooperate with the Selling Holders and the managing Underwriters,
if any, to facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be sold and not bearing any
restrictive legends; and enable such Registrable Securities to be registered
in such names as the managing Underwriters, if any, may request at least two
business days prior to any sale of Registrable Securities to the
Underwriters;
(j) if any fact contemplated by paragraph (c) (6) above shall exist,
prepare a supplement or post-effective amendment to the Registration
Statement or the related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter
delivered to the purchasers of the Registrable Securities, the Prospectus
will not contain an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they are made,
not misleading;
(k) cause all Registrable Securities covered by the Registration
Statement to be listed on each securities exchange on which similar
securities issued by the Company are then listed if requested by the
Holders' Representative or the managing Underwriters, if any;
(l) not later than the effective date of the Registration Statement,
provide a CUSIP number for all
- 8 -
<PAGE>
Registrable Securities and provide the applicable transfer agents with
printed certificates for the Registrable Securities which are in a form
eligible for deposit with Depositary Trust Company;
(m) in the case of an underwritten offering, enter into an
underwriting Agreement with the Underwriters continuing such
representations, warranties, covenants and indemnities as are customary for
underwritten offerings effected for the accounts of selling security
holders; obtain such opinions, certificates and letters in connection
therewith as may be reasonably requested by such Underwriters; and deliver
such other documents and certificates as Holders' Representative or such
Underwriters may reasonably request in connection with such offering;
(n) make available for inspection by Holders' Representative, any
Underwriter participating in any disposition pursuant to a Registration
Statement, and any attorney or accountant retained by the Selling Holders or
an Underwriter, all financial and other records, pertinent corporate
documents and properties of the Company, and cause the Company's officers,
directors and employees to supply all information reasonably requested by
Holders' Representative or such Underwriter, attorney or accountant in
connection with the registration; provided that
--------
such Persons enter into a confidentiality agreement, in form and substance
reasonably satisfactory to the Company, prior to the release or disclosure
of any such information, records or documents;
(o) otherwise use its best efforts to comply with all applicable
rules and regulations of the SEC, and make generally available to its
security holders earnings statements satisfying the provisions of Section
ll(a) of the Securities Act, no later than 45 days after the end of any 12-
month period (or 90 days, if such period is a fiscal year) (l) commencing at
the end of any fiscal quarter in which Registrable Securities are sold to
Underwriters in an underwritten offering, or, if not sold to Underwriters in
such an offering, (2) beginning with the first month of the Company's first
fiscal quarter commencing after the effective date of the Registration
Statement, which statements shall cover said 12-month periods; and
(p) cooperate and assist in any filings required to be made with the
NASD and in the performance of any due diligence investigation by any
Underwriter (including any "qualified independent underwriter" that is
required to be retained in accordance with the rules and regulations of the
NASD).
- 9 -
<PAGE>
The Company will cooperate with and assist Selling Holders in
effecting the sale of the Registrable Securities. In the case of an
underwritten offering of the Registrable Securities that does not include
any securities to be sold by or on behalf of the Company, the Company and
its officers will, upon the reasonable request of the Holders'
representative, participate directly in the marketing and sale of the
Registrable Securities (including personal appearances at meetings with
potential purchasers of the Registrable Securities) to the extent that the
Company and its officers would participate in the marketing and sale of
Common Stock for its own account in an underwritten offering of comparable
size, provided, that the Selling Holders shall
--------
reimburse the Company for their portion (based on the proportion that their
shares to be sold bears to the total number of shares to be sold in the
underwritten public offering) of all reasonable out-of-pocket expenses
incurred by the Company relating to the participation of it and its officers
in such marketing and sales efforts requested by Holders' Representative.
The Company may require each Selling Holder to furnish to the Company
such information regarding the distribution of such securities as the
Company may from time to time reasonably request in writing.
Each Selling Holder agrees by acquisition of the Registrable
Securities that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 5(c) hereof (other
than 5(c)(1) hereof), such Selling Holder will forthwith discontinue
disposition of Registrable Securities until such Selling Holder's receipt of
the copies of the supplemented or amended Prospectus contemplated by Section
5(j) hereof, or until it is advised in writing by the Company that the use
of the Prospectus may be resumed, and has received copies of any additional
or supplemental filings which are incorporated by reference in the
Prospectus, and, if so directed by the Company, Holders' Representative and
each such Selling Holder will deliver to the Company (at the Company's
expense) all copies, other than permanent file copies then in Holders'
Representative's or such Selling Holder's possession, of the Prospectus
covering such Registrable Securities current at the time of receipt of such
notice. If the Company shall give any such notice, the time period mentioned
in Section 2(a)(ii) hereof shall be extended by the number of days during
the period from and including the date of the giving of such notice to and
including the date when Holders' Representative and each Selling Holder
either receives the copies of the supplemented or amended prospectus
contemplated by Section 5(j) hereof or is advised in writing by the Company
that the use of the Prospectus may be resumed.
- 10 -
<PAGE>
Each Selling Holder agrees by acquisition of the Registrable
Securities to cooperate with the Company in all reasonable respects in
connection with the preparation and filing of Registration Statements
hereunder in which such registrable Securities are included or expected to
be included.
6. Registration Expenses
---------------------
(a) All expenses ("Registration Expenses") incident to the Company's
performance of or compliance with this Agreement will be paid by the
Company, regardless whether the Registration Statement becomes effective,
including without limitation:
(l) all registration and filing fees (including with respect to
filings required to be made with the Nasdaq National Market or NASD);
(2) fees and expenses of compliance with securities or blue sky
laws (including fees and disbursements of counsel for the Underwriters or
Selling Holders in connection with blue sky qualifications of the
Registrable Securities and determination of their eligibility for investment
under the laws of such jurisdictions as the managing Underwriters or
Holders' Representative may designate);
(3) printing (including expenses of printing certificates for
the Registrable Securities and of printing prospectuses), messenger,
telephone and delivery expenses;
(4) fees and disbursements of counsel for the Company;
(5) fees and disbursements of all independent certified public
accountants of the Company (including the expenses of any special audit and
"cold comfort" letters required by or incident to such performance);
(6) fees and expenses of other Persons retained by the Company;
and
(7) fees and expenses associated with any NASD filing required
to be made in connection with the Registration Statement, including, if
applicable, the fees and expenses of any "qualified independent underwriter"
(and its counsel) that is required to be retained in accordance with the
rules and regulations of the NASD (all such expenses being herein called
"Registration Expenses").
- 11 -
<PAGE>
The Company will not have any obligation to pay any underwriting fees,
discounts or commissions attributable to the sale of Registrable Securities.
The Company will, in any event, pay its internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any annual audit, the
fees and expenses incurred in connection with the listing of the securities
to be registered on each securities exchange on which similar securities
issued by the Company are then listed, and the fees and expenses of any
Person, including special experts, retained by the Company, provided, that
--------
the foregoing is not intended to prejudice the Company's right to obtain
reimbursement of certain out-of-pocket expenses pursuant to the proviso set
forth in Section 5 hereof.
(b) In connection with each Registration Statement required
hereunder, the Company will reimburse the Selling Holders for the reasonable
fees and disbursements of not more than one law firm chosen by the Holders'
Representative.
7. Indemnification
---------------
(a) Indemnification by Company. The Company shall indemnify
--------------------------
and hold harmless each Holder, its officers, directors, employees and Agents
and each Person who controls such Holder within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act (each
such person being sometimes hereinafter referred to as an "Indemnified
Holder") from and against all losses, claims, damages, liabilities and
expenses (including reasonable costs of investigation and legal expenses)
arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement or
Prospectus or in any amendment or supplement thereto or in any preliminary
prospectus, or arising out of or based upon any omission or alleged omission
to state therein a material fact required to be stated therein or necessary
to make the statements therein not misleading, except insofar as such
losses, claims, damages, liabilities or expenses arise out of or are based
upon any such untrue statement or omission or allegation thereof based upon
information furnished in writing to the Company by such Holder expressly for
use therein; provided, that the Company
--------
shall not be liable in any such case to the extent that any such loss,
claim, damage, liability or expense arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made
in any preliminary prospectus if (i) such Holder failed to send or deliver a
copy of the Prospectus with or prior to
- 12 -
<PAGE>
the delivery of written confirmation of the sale of Registrable Securities
and (ii) the Prospectus would have completely corrected such untrue
statement or omission; and provided, further, that the
--------
Company shall not be liable in any such case to the extent that any such
loss, claim damage, liability or expense arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
in the Prospectus, if such untrue statement or alleged untrue statement,
omission or alleged omission is completely corrected in an amendment or
supplement to the Prospectus and if, having previously been furnished by or
on behalf of the Company with copies of the Prospectus as so amended or
supplemented, such Holder thereafter fails to deliver such Prospectus as so
amended or supplemented, prior to or concurrently with the sale of a
Registrable Security to the person asserting such loss, claim, damage,
liability or expense who purchased such Registrable Security which is the
subject thereof from such Holder. This indemnity will be in addition to any
liability which the Company may otherwise have. The Company will also
indemnify Underwriters, selling brokers, dealer managers and similar
securities industry professionals participating in the distribution, their
officers and directors and each Person who controls such Persons (within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act) to the same extent as provided above with respect to the
indemnification of the Indemnified Holders; provided, however, if such
-------- -------
Underwriters,
selling brokers, dealer managers or similar securities industry
professionals require or agree to indemnification provisions different from
those set forth herein, but standard in the industry, the Company agrees to
provide them such indemnification rather than the indemnification provided
for herein.
If any action or proceeding (including any governmental investigation
or inquiry) shall be brought or asserted against an Indemnified Holder in
respect of which indemnity may be sought from the Company, such Indemnified
Holder shall promptly notify the Company in writing, and the Company shall
assume the defense thereof, including the employment of counsel satisfactory
to such Indemnified Holder and the payment of all expenses. Such
Indemnified Holder shall have the right to employ separate counsel in any
such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be the expense of such Indemnified Holder
unless (a) the Company has agreed to pay such fees and expenses or (b) the
Company shall have failed to assume the defense of such action or proceeding
and has failed to employ counsel satisfactory to such Indemnified Holder in
any such action or proceeding or (c) the named parties to any such action or
proceeding (including any impleaded parties) include both such Indemnified
Holder and the Company, and such Indemnified Holder shall have been advised
by counsel reasonably satisfactory to the
- 13 -
<PAGE>
Company that there may be one or more legal defenses available to such
Indemnified Holder which are different from or additional to those available
to the Company (in which case, if such Indemnified Holder notifies the
Company in writing that it elects to employ separate counsel at the expense
of the Company, the Company shall not have the right to assume the defense
of such action or proceeding on behalf of such Indemnified Holder, it being
understood, however, that the Company shall not, in connection with any one
such action or proceeding or separate but substantially similar or related
actions or proceedings in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys at any time for such
Indemnified Holder and any other Indemnified Holders, which firm shall be
designated in writing by such Indemnified Holders). The Company shall not be
liable for any settlement of any such action or proceeding effected without
its written consent, but if settled with its written consent, or if there be
a final judgment for the plaintiff in any such action or proceeding, the
Company agrees to indemnify and hold harmless such Indemnified Holders from
and against any loss or liability by reason of such settlement or judgment.
(b) Indemnification by Holder of Registrable Securities.
---------------------------------------------------
Each Holder agrees to indemnify and hold harmless the Company, its directors
and officers and each Person, if any, who controls the Company within the
meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from the Company
to such holder, but only with respect to information relating to such Holder
furnished in writing by such Holder expressly for use in any Registration
Statement or Prospectus, or any amendment or supplement thereto, or any
preliminary prospectus. In case any action or proceeding shall be brought
against the Company or its directors or officers or any such controlling
person, in respect of which indemnity may be sought against a Holder, such
Holder shall have the rights and duties given the Company and the Company or
its directors or officers or such controlling person shall have the rights
and duties given to each Holder by the preceding paragraph. In no event
shall the liability of any Selling Holder hereunder be greater in amount
than the dollar amount of the proceeds received by such Selling Holder upon
the sale of the Registrable Securities giving rise to such indemnification
obligation.
The Company shall be entitled to receive indemnities from
Underwriters, selling brokers, dealer managers and similar securities
industry professionals participating in the distribution, to the same extent
as provided above with
- 14 -
<PAGE>
respect to information so furnished in writing by such Persons specifically
for inclusion in any Prospectus or Registration Statement or any amendment
or supplement thereto, or any preliminary prospectus.
(c) Contribution. If the indemnification provided for in
------------
this Section 7 is unavailable to an indemnified party under Section 7(a) or
Section 7(b) hereof (other than by reason of exceptions provided in those
Sections) in respect of any losses, claims, damages, liabilities or expenses
referred to therein, then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, dam-
ages, liabilities or expenses in such proportion as is appropriate to
reflect the relative fault of the Company on the one hand and of the
Indemnified Holder on the other in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The
relative fault of the Company on the one hand and of the Indemnified Holder
on the other shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Indemnified Holder and the parties'
relative intent, knowledge, access to information and opportunity to correct
or prevent such statement or omission. The amount paid or payable by a party
as a result of the losses, claims, damages, liabilities and expenses
referred to above shall be deemed to include, subject to the limitations set
forth in the second paragraph of Section 7(a), any legal or other fees or
expenses reasonably incurred by such party in connection with investigating
or defending any action or claim.
The Company and each Holder agree that it would not be just and
equitable if contribution pursuant to this Section 7(c) were determined by
pro rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. Notwithstanding the provisions of this Section 7(c), an
Indemnified Holder shall not be required to contribute any amount in excess
of the amount by which the total price at which the Securities sold by such
Indemnified Holder or its affiliated Indemnified Holders and distributed to
the public were offered to the public exceeds the amount of any damages
which such Indemnified Holder, or its affiliated Indemnified Holder, has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section ll(f) of the Act) shall be
entitled to
- 15 -
<PAGE>
contribution from any person who was not guilty of such fraudulent
misrepresentation.
8. Rule 144
--------
The Company covenants that it will file the reports required to be
filed by it under the Securities Act and the Exchange Act and the rules and
regulations adopted by the Commission thereunder, and it will take such
further action as any Holder of Registrable Securities may reasonably
request, all to the extent required from time to time to enable such Holder
to sell Registrable Securities without registration under the Securities Act
within the limitation of the exemptions provided by (a) Rule 144 under the
Securities Act, as such Rule may be amended from time to time, or (b) any
similar rule or regulation hereafter adopted by the Commission. Upon the
request of any Holder, the Company will deliver to such Holder a written
statement as to whether it has complied with such information and
requirements.
9. Participation in Underwritten Registrations
-------------------------------------------
No Person may participate in any underwritten registration hereunder
unless such Person (a) agrees to sell such Person's securities on the basis
provided in any underwriting arrangements approved by the Persons entitled
hereunder to approve such arrangements and (b) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting arrangements.
10. Miscellaneous
-------------
(a) Remedies. Each Holder in addition to being entitled to
--------
exercise all rights provided herein, and granted by law, including recovery
of damages, will be entitled to specific performance of its rights under
this Agreement. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by it of
the provisions of this Agreement and hereby agrees to waive the defense in
any action for specific performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company will not on or
--------------------------
after the date of this Agreement and for so long as it has an obligation to
maintain a Shelf Registration pursuant to Section 2(a), enter into any
agreement with respect to its securities which is inconsistent with the
rights granted to the Holders in this Agreement or otherwise conflicts with
the provisions hereof. The rights granted to the Holders hereunder do not
in any way conflict with and are not inconsistent with the rights granted to
the Holders of the Company's securities under any such
- 16 -
<PAGE>
agreements. Other than as disclosed on Schedule 10(b), the Company has not
granted registration rights with respect to Common Stock to any person other
than a Holder.
(c) Actions Affecting Registrable Securities. The Company
----------------------------------------
agrees to use its best efforts to cause all Registrable Securities to be
listed on the Nasdaq National Market System or any other exchange on which
shares of the same security are then traded.
(d) Amendments and Waivers. The provisions of this
----------------------
Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given unless the Company has obtained the
written consent of the Holders' Representative.
(e) Notices. All notices and other communications provided
-------
for or permitted hereunder shall be made in writing by hand-delivery,
registered first-class mail, telecopier, or air courier service.
(i) if to a Holder, at the most current address given by such
Holder to the Company in accordance with this Section 10(e), which address
initially is, with respect to Armco or AJV:
Armco Inc.
One Oxford Centre
301 Grant Street
Pittsburgh, Pennsylvania 15219-1415
Attn: General Counsel
Telecopy Number: 412-255-9805
in each case with a copy to Holders' Representative at the most
current address given by Holders' Representative to the Company in
accordance with this Section 10(e), which address initially is:
Armco Inc.
One Oxford Centre
301 Grant Street
Pittsburgh, Pennsylvania 15219-1415
Attn: General Counsel
Telecopy Number: 412-255-9805
(ii) if to the Company, initially at 703 Curtis Street,
Middletown, Ohio 45043, Attn: General Counsel, telefax number: 513-425-
5607, and thereafter at such other address, notice of which is given in
accordance with this Section 10(e).
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if
- 17 -
<PAGE>
personally delivered; 10 business days after being deposited in the mail,
postage prepaid, if mailed; when receipt is acknowledged, if telecopied; and
on the date of delivery, if delivered by an air courier.
(f) Successors and Assigns. This Agreement shall inure to
----------------------
the benefit of and be binding upon the successors and assigns of each of the
parties.
(g) Counterparts. This Agreement may be executed in any
------------
number of counterparts and by the parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for
--------
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(i) Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws of the State of Delaware, without
regard to principles of choice of law.
(j) Severability. If any one or more of the provisions
------------
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability
of any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(k) Entire Agreement. This Agreement is intended by the
----------------
parties as a final expression of their agreement and intended to be a
complete and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein. There are
no restrictions, promises, warranties or undertakings, other than those set
forth or referred to herein, with respect to the registration rights granted
by the Company with respect to the securities sold pursuant to the Equity
Exchange Agreement or issued to Armco upon the initial capitalization of the
Company. This Agreement supersedes all prior agreements and understandings
between the parties with respect to such subject matter.
(l) Holders' Representative. Armco Inc. is appointed as a
-----------------------
Holders' Representative to be representative of the Holders and to act on
behalf of the Holders in all respects set forth in this Agreement.
- 18 -
<PAGE>
(m) Third Party Beneficiaries. This Agreement is intended
-------------------------
for the benefit of the Company and the Holders and their respective
successors and assigns, and is not for the benefit of nor may any provision
hereof be enforced by, any other Person.
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date first written above.
AK STEEL HOLDING CORPORATION
By: /s/ Randall F. Preheim
---------------------------
Name: Randall F. Preheim
--------------------
Title: Vice President
--------------------
AJV INVESTMENTS CORP.
By: /s/ Gary R. Hildreth
---------------------------
Name: Gary R. Hildreth
--------------------
Title: Vice President
--------------------
ARMCO INC.
By: /s/ John B. Corey
--------------------------
Name: John B. Corey
--------------------
Title: Vice President
--------------------
- 19 -
<PAGE>
Schedule 10(b)
--------------
Other Registration Rights
-------------------------
1. Registration Rights Agreement dated as of April 7, 1994 among the
Company, Kawasaki Steel Investments, Inc., KSCA, Incorporated and Kawasaki
Steel Holdings (USA), Inc.
2. Registration rights agreement between the Company and Thomas Graham, to
be entered into at such time as the Company issues shares in lieu of cash in
payment of a portion of Mr. Graham's bonus under his employment agreement
with Armco Steel Company, L.P.
