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Exhibit
10.1
NOTE PURCHASE
AGREEMENT
This Note Purchase Agreement
(this “Agreement”) is entered into as of the 8
th
day of May, 2007, by and
between Wheeling-Pittsburgh Steel Corporation, a Delaware
corporation (the “Company”), Wheeling-Pittsburgh
Corporation, a Delaware corporation (“Parent”), Clayton
Acquisition Corporation, a Delaware corporation (“New
Esmark”) and each of the investors set forth on the signature
pages hereto (each, an “Investor,” and collectively,
the “Investors”).
WHEREAS, the Company is
offering, in compliance with Rule 506 of Regulation D of the
Securities Act of 1933, as amended (the “Securities
Act”), to certain accredited investors in a private placement
transaction, exchangeable notes in a series with an aggregate
principal amount of up to Twenty-Three Million Dollars
($23,000,000), substantially in the form attached hereto as
Exhibit A (the “Notes”).
WHEREAS, on the terms and
subject to the conditions set forth herein, each Investor desires
to purchase a Note in the face principal amount set forth opposite
Investor’s name on Exhibit B , which Notes shall be
exchangeable for shares (subject to adjustment as set forth in the
Notes, the “Conversion Shares,” and together with the
Notes, the “Securities”) of the New Esmark’s
common stock, par value $0.01 per share (the “Common
Stock”) pursuant to the terms of the Notes.
WHEREAS, the Company, Parent
and New Esmark desire to set forth the terms and conditions of and
to provide for the issuance of the Notes described herein and with
respect to certain registration rights relating to the shares of
Common Stock issuable upon exchange of the Notes, pursuant to their
terms.
NOW, THEREFORE, for and in
consideration of the mutual premises contained herein and for other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Company, Parent, New Esmark and
the Investors hereby agree as follows:
1) ISSUANCE OF THE EXCHANGEABLE NOTES
AND CONVERSION SHARES. Subject to the terms and conditions set
forth in this Agreement, the Company hereby agrees to sell to each
Investor, and each Investor hereby agrees to purchase from the
Company, the face principal amount of the Notes set forth opposite
each Investor’s name on Exhibit B (the “Purchase
Price”). The Note delivered to an Investor will be delivered
in the form of a single Note registered in the name of the Investor
(or in the name of such nominee or in such other denominations as
Investor may specify). The terms and conditions of the Notes are
incorporated herein by reference. Subject to the terms and
conditions set forth in this Agreement and the Notes, New Esmark
hereby agrees to issue the Conversion Shares on exchange of the
Notes. New Esmark hereby agrees to adjust the Conversion Shares,
and comply with the covenants with respect thereto, set forth in
Section 5(d)(iii), (iv) and (v) of the
Notes.
2) THE CLOSING. The purchase and sale of
the Notes by the Company to the Investors and the delivery of the
Purchase Price to the Company (the “Closing”) will take
place on the second business day following the satisfaction of all
conditions precedent set forth in Section 8 hereof (or such
other date as the Company, Parent, New Esmark and the Investors
shall determine), at
the offices of the Company, 1134 Market
Street, Wheeling, WV 26003. At the Closing, (a) each Investor
shall pay or tender to the Company the applicable Purchase Price in
immediately available funds by wire transfer to the Company in
accordance with the wiring instructions provided by the Company;
and (b) the Company shall issue and deliver to each Investor
the Note(s) acquired hereunder by such Investor.
3) REPRESENTATIONS AND WARRANTIES OF
INVESTORS. Each Investor represents and warrants individually and
not jointly to the Company, Parent and New Esmark as of the date
hereof as follows:
a) Investor is an
“accredited investor” as that term is defined in Rule
501 of Regulation D promulgated under the Securities
Act.
b) The Notes are being
acquired by Investor for investment purposes only, for
Investor’s own account and not with the view to any resale or
distribution thereof, and Investor is not participating, directly
or indirectly, in an underwriting of such Notes, and will not take,
or cause to be taken, any action that would cause Investor to be
deemed an “underwriter” of such Notes as defined in
Section 2(11) of the Securities Act.
c) Investor acknowledges that
Investor has been offered an opportunity to ask questions of, and
receive answers from, the Company, Parent and New Esmark concerning
Investor’s proposed purchase of the Notes, and that such
Investor is satisfied with the Company’s, Parent’s and
New Esmark’s response to any such requests.
d) Investor has such
knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of an investment in the
Notes, is able to bear such risks, and has obtained, in
Investor’s judgment, sufficient information from the Company,
Parent and New Esmark to evaluate the merits and risks of an
investment in the Notes. Investor has evaluated the risks of
investing in the Company and New Esmark and has determined that the
Notes are a suitable investment for Investor.
e) Investor has full power
and authority to enter into this Agreement and to perform its
obligations hereunder.
f) All action on the part of
Investor necessary for the authorization, execution and delivery of
this Agreement and for the performance of all obligations of
Investor hereunder has been taken, including with respect to all
required corporate or organizational grant of authority with
respect to such Investors as are corporations or other forms of
entity. This Agreement has been duly executed and delivered by
Investor and constitutes a valid and legally binding obligation of
Investor, enforceable in accordance with its respective terms,
subject to (i) the laws of bankruptcy and the laws affecting
creditors’ rights generally and (ii) the availability of
equitable remedies.
g) Investor is not relying on
the Company, Parent or New Esmark with respect to tax and other
investment advice in connection with its decision to purchase the
Notes. Investor acknowledges that it has been advised by the
Company, Parent and New Esmark to consult with its tax or financial
consultants prior to entering into this Agreement.
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4) REPRESENTATIONS AND WARRANTIES OF THE
COMPANY AND PARENT. The Company and Parent represent and warrant to
the Investors as of the date hereof as follows:
a) The Company and Parent are
duly incorporated, validly existing and in good standing under the
laws of the jurisdiction of their respective incorporation. The
Company and Parent are duly qualified as a foreign corporation to
do business and are in good standing in each jurisdiction in which
their respective ownership or use of property or the nature of the
business conducted by each makes such qualification necessary,
except where the failure to be so qualified or in good standing
would not have a material adverse effect on the business,
operations, assets, financial condition or prospects of the Company
or Parent (a “Material Adverse Effect”). The Company
and Parent have full power and authority: (i) to own, lease,
use and operate their respective properties; (ii) to carry on
their respective business as presently operated and conducted; and
(iii) to enter into this Agreement and perform their
respective obligations hereunder, including, for the Company, the
issuance, sale and delivery of the Notes.
b) The execution and delivery
of this Agreement by the Company and Parent and of the Notes by the
Company and the consummation by them of the transactions
contemplated hereby (including without limitation, the issuance of
the Notes by the Company ) have been duly authorized by their
respective Board of Directors and no further consent or
authorization of the Company, Parent, their respective Board of
Directors, or their respective stockholders is required. All action
on the part of the Company and Parent necessary for the
authorization, execution and delivery of this Agreement and for the
performance of all obligations of the Company and Parent hereunder
has been taken. This Agreement and the Notes have been duly
executed and delivered by the Company and constitute valid and
legally binding obligations of the Company, enforceable in
accordance with their respective terms, subject to (i) the
laws of bankruptcy and the laws affecting creditors’ rights
generally and (ii) the availability of equitable remedies.
This Agreement has been duly executed and delivered by Parent and
constitutes valid and legally binding obligations of Parent,
enforceable in accordance with its respective terms, subject to
(i) laws of bankruptcy and the laws affecting creditors’
rights generally and (ii) the availability of equitable
remedies.
c) Parent has timely filed
and furnished all required reports, schedules, forms, prospectuses,
and registration, proxy and other statements with the Securities
and Exchange Commission (“SEC”) since August 1,
2003 (collectively and together with all documents filed on a
voluntary basis on Form 8-K, and in each case including all
exhibits and schedules thereto and documents incorporated by
reference therein, the “SEC Documents”). As of their
respective effective dates (in the case of SEC Documents that are
registration statements filed pursuant to the requirements of the
Securities Act) and as of their respective SEC filing dates (in the
case of all other SEC Documents), each SEC Document complied in all
material respects with the applicable requirements of the
Securities Act or the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), and the rules and regulations
thereunder, as applicable. Except to the extent that information
contained in any SEC Document has been revised or superseded by a
later-filed SEC Document or by information supplied to the
Investors in writing by the Company or Parent, none of the SEC
Documents contains any untrue statement of a material fact or omits
to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not
misleading.
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d) The execution, delivery
and performance of this Agreement and each of the documents
contemplated hereby by the Company and Parent, including the Notes
by the Company, and the consummation by the Company and Parent of
the transactions contemplated hereby and thereby will not
(i) conflict with or result in a violation of any provision of
the certificate of incorporation, as amended, of the Company or
Parent or the bylaws, as amended, of the Company or Parent,
(ii) violate or conflict with, or result in a breach of any
provision of, or constitute a default (or an event which with
notice or lapse of time or both could become a default) under, or
give to others any rights of termination, amendment, acceleration
or cancellation of, any material agreement, indenture, patent,
patent license or instrument to which the Company or Parent is a
party, or (iii) result in a violation of any federal, state,
local, municipal, foreign, international, multinational or other
law, rule, regulation, order, judgment, decree, ordinance, policy
or directive, including those entered, issued, made, rendered or
required by any court, administrative or other governmental body,
agency, or authority, or any arbitrator (collectively, “Legal
Requirements”) (including federal and state securities laws
and regulations (assuming the accuracy of the representations and
warranties of each Investor contained in Section 3(a) hereof)
and regulations of any self-regulatory organizations to which the
Company or Parent is subject) applicable to the Company or Parent
or by which any property or asset of the Company or Parent is bound
or affected (except for such conflicts, defaults, terminations,
amendments, accelerations, cancellations and violations as would
not, individually or in the aggregate, have a Material Adverse
Effect). The Company is not in violation of its certificate of
incorporation, bylaws or other organizational documents and the
Company is not in default (and no event has occurred which with
notice or lapse of time would result in a default) under, and the
Company has not taken any action or failed to take any action that
would give to others any rights of termination, amendment,
acceleration or cancellation of, any agreement or instrument to
which the Company is a party or by which any property or assets of
the Company is bound or affected, except for possible defaults as
would not, individually or in the aggregate, have a Material
Adverse Effect. Except with respect to any filings as required
under the Securities Act and any applicable state securities laws,
the Company is not required to obtain any consent, authorization or
order of, or make any filing or registration with, any court,
governmental agency, regulatory agency, self regulatory
organization or stock market or any third party in order for it to
execute, deliver or perform any of its obligations under this
Agreement or the Notes. All consents, authorizations, orders,
filings and registrations that the Company is required to effect or
obtain pursuant to the preceding sentence have been obtained or
effected on or prior to the date hereof.
e) As of their respective
dates, the financial statements of Parent included in the SEC
Documents complied as to form in all material respects with
applicable accounting requirements and the published rules and
regulations of the SEC with respect thereto. Such financial
statements have been prepared in accordance with United States
generally accepted accounting principles, consistently applied,
during the periods involved (except (i) as may be otherwise
indicated in such financial statements or the notes thereto, or
(ii) in the case of unaudited interim statements, to the
extent they may not include footnotes, year end adjustments or may
be condensed or summary statements) and fairly present in all
material respects the consolidated financial position of Parent and
its consolidated subsidiaries as of the dates thereof
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and the consolidated results of their
operations and cash flows for the periods then ended (subject, in
the case of unaudited statements, to normal year-end audit
adjustments). Except as set forth in the financial statements of
Parent included in the SEC Documents, Parent has no liabilities,
contingent or otherwise, other than (i) liabilities incurred
in the ordinary course of business subsequent to December 31,
2006, and (ii) obligations under contracts and commitments
incurred in the ordinary course of business and not required under
generally accepted accounting principles to be reflected in such
financial statements, which, individually or taken in the aggregate
would not reasonably be expected to have a Material Adverse
Effect.
f) Except with respect to the
transactions contemplated hereby and as set forth in the SEC
Documents filed since December 31, 2006 (i) Parent and
each of its subsidiaries, including the Company, has conducted its
business only in the ordinary course, consistent with past
practice, and since that date, no changes have occurred which would
reasonably be expected to have a Material Adverse Effect; and
(ii) the Company and Parent have not incurred any liabilities
(contingent or otherwise) other than (A) trade payables,
accrued expenses and other liabilities incurred in the ordinary
course of business consistent with past practice and
(B) liabilities not required to be reflected on the
Company’s financial statements pursuant to generally accepted
accounting principles, consistently applied or required to be
disclosed in filings made with the SEC.
g) There is no Action (as
defined below) pending or, to the knowledge of the Company or
Parent, threatened against or affecting Parent or any of its
subsidiaries, including the Company, that (i) adversely
affects or challenges the legality, validity or enforceability of
this Agreement, or (ii) would, if there were an unfavorable
decision, have or reasonably be expected to have a Material Adverse
Effect. Neither Parent nor any of its subsidiaries, including the
Company, nor any director or officer thereof (in his or her
capacity as such), is or has been the subject of any Action
involving a claim of violation of or liability under federal or
state securities laws or a claim of breach of fiduciary duty. There
has not been, and to the knowledge of the Company or Parent, there
is not pending any investigation by the SEC involving Parent or any
current or former director or officer of Parent (in his or her
capacity as such). For purposes of this Agreement,
“Action” shall mean any action, suit claim, inquiry,
notice of violation, proceeding (including any partial proceeding
such as a deposition) or investigation against or affecting Parent,
any of its subsidiaries, including the Company, or any of their
respective properties before or by any court, arbitrator,
governmental or administrative agency, regulatory authority
(federal, state, county, local or foreign), public board, stock
market, stock exchange or trading facility.
h) The Company and each of
its subsidiaries is in possession of all franchises, grants,
authorizations, licenses, permits, easements, variances,
exemptions, consents, certificates, approvals and orders necessary
to own, lease and operate its properties and to carry on its
business as it is now being conducted (collectively,
“Permits”), and there is no Action pending or, to the
knowledge of the Company, threatened regarding suspension or
cancellation of any of the Permits. Neither the Company nor any of
its subsidiaries is in conflict wit
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