Exhibit 2.1
HOLDING COMPANY REORGANIZATION AGREEMENT
HOLDING COMPANY REORGANIZATION AGREEMENT ("Agreement"), dated as
of July 1, 2001, by and among USX Corporation, a Delaware corporation ("Old
USX"), USX HoldCo, Inc., a Delaware corporation and wholly owned subsidiary
of Old USX, to be renamed "USX Corporation" ("USX"), and United States
Steel LLC, a Delaware limited liability company and wholly owned subsidiary
of USX ("SteelCo").
W I T N E S S E T H:
WHEREAS, Old USX is a diversified company principally engaged in the
energy business and the steel business;
WHEREAS, pursuant to the Restated Certificate of Incorporation of
Old USX (the "Restated Certificate"), the businesses of Old USX are divided
between two groups, the U. S. Steel Group and the Marathon Group (each, as
defined in the Restated Certificate);
WHEREAS, Old USX has outstanding two classes of common stock,
USX-Marathon Group Common Stock, par value $1.00 per share ("Marathon Group
Shares"), which is intended to reflect the performance of the Marathon
Group, and USX-U. S. Steel Group Common Stock, par value $1.00 per share
("U. S. Steel Group Shares"), which is intended to reflect the performance
of the U. S. Steel Group;
WHEREAS, Old USX has outstanding one series of preferred stock,
without par value, designated as 6.50% Cumulative Convertible Preferred
Stock ("6.50% Preferred Shares");
WHEREAS, the Board of Directors of Old USX (the "Board") has
determined that it is advisable and in the best interests of Old USX and its
stockholders to implement a holding company structure by merging Old USX
with and into SteelCo (the "HoldCo Merger"), subject to the terms and
conditions hereof, and pursuant to Section 251(g) of the General
Corporation Law of the State of Delaware (as amended from time to time, the
"DGCL") and Section 18-209 of the Delaware Limited Liability Company Act
(as amended from time to time, the "DLLCA"), with SteelCo continuing as the
susviving entity and a wholly owned subsidiary of USX, so that, immediately
following the HoldCo Effective Time (as defined herein), USX will be a
holding company that owns all of the outstanding equity of Marathon (which
shall own and operate the business of the Marathon Group) and SteelCo
(which shall own and operate the business of the U. S. Steel Group);
WHEREAS, the Board has determined that the HoldCo Merger will
align the liabilities and risks of the business of the Marathon Group and
the U. S. Steel Group with the company responsible for such liabilities and
risks;
WHEREAS, the Board has, in light of and subject to the terms and
conditions set forth herein, (i) determined that the HoldCo Merger is
advisable and in the best interests of Old USX and the holders of each of
the Marathon Group Shares and the U. S. Steel Group Shares and (ii)
approved and declared the advisability of this Agreement and the
transactions contemplated hereby, including, without limitation, the HoldCo
Merger;
WHEREAS, the board of directors of SteelCo has approved and
declared the advisability of this Agreement and the transactions
contemplated hereby, including, without limitation, the HoldCo Merger;
WHEREAS, it is the intention of the parties hereto that the
transactions contemplated by this Agreement shall be a tax-free
reorganization under Section 368 of the Internal Revenue Code of 1986, as
amended (the "Code"), and the rules and regulations promulgated thereunder;
and
WHEREAS, the parties hereto desire to make certain covenants and
agreements and to allocate certain assets, liabilities and obligations in
connection with the HoldCo Merger and the other transactions contemplated
by this Agreement (collectively, the "Transactions") and to prescribe
various conditions to the Transactions.
NOW, THEREFORE, in furtherance of the foregoing and in
consideration of the mutual promises and undertakings contained herein and
in any other document executed in connection with this Agreement, the
parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 General. For the purposes of this Agreement,
the following terms shall have the meanings set forth below:
(a) "Action" shall mean any action, claim
(whether or not filed), suit, arbitration, inquiry, demand, proceeding or
investigation.
(b) "Applicable Law" shall mean, with respect to
any Person, all statutes, laws, ordinances, rules, orders and regulations
of any Governmental Authority applicable to such Person or its business,
properties and assets.
(c) "Cash" shall mean cash on hand, all other
cash in any bank, savings or similar accounts at any financial institution,
and checks, drafts and similar instruments and any bonds or similar
marketable securities, certificates of deposit, commercial paper,
eurodollar deposits and any other cash equivalents, held in the name of or
for the account of Old USX.
(d) "Contract" shall mean any contract,
agreement, lease, license, sales order, purchase order, instrument or other
commitment, written or oral.
(e) "Disclosure Letter" shall mean the letter,
dated as of the date hereof, delivered by Old USX to the other parties
hereto, as the same may be amended or supplemented from time to time in a
document signed by all parties hereto.
(f) "Employee Arrangements" shall mean all
employment or consulting agreements or arrangements, all severance or
change in control agreements or arrangements and all other agreements or
arrangements with respect to the employment and termination of employment
of any employee, officer or director (other than any Employee Benefit
Plan).
(g) "Employee Incentive Plans" shall mean all
incentive compensation, stock award, stock option or stock purchase plans
and equity compensation arrangements.
(h) "Governmental Authority" shall mean any
foreign, federal, state or local government, court, agency or commission or
other governmental or regulatory body or authority.
(i) "Group" shall mean the Marathon Group and/or
the U. S. Steel Group, as the case may be.
(j) "Joint Insurance Arrangements" shall mean
the insurance policies and Contracts of Old USX existing at the HoldCo
Effective Time and/or prior thereto that are (i) owned or maintained by or
on behalf of Old USX or any of its predecessors and that relate to both (a)
the U. S. Steel Group assets, business and/or Liabilities and (b) the
Marathon Group assets, business and/or Liabilities, and (ii) are listed in
Section 2.1(b)(iv) of the Disclosure Letter.
(k) "Liability" shall mean, with respect to any
Person, except as otherwise expressly provided herein, any direct or
indirect liability (whether absolute, accrued or unaccrued, contingent,
liquidated or unliquidated, matured or unmatured or known or unknown),
indebtedness, obligation, expense, claim, deficiency, guarantee or
endorsement of or by such Person (including, without limitation, those
arising under any Applicable Law or Action or under any award of any court,
tribunal or arbitrator of any kind, and those arising under any Contract).
(l) "Marathon" shall mean Marathon Oil Company,
an Ohio corporation and a wholly owned subsidiary of Old USX.
(m) "Marathon Insurance Arrangements" shall mean
the insurance policies and Contracts of Old USX existing immediately prior
to the HoldCo Effective Time which are owned or maintained by or on behalf
of Old USX or any of its predecessors and which relate only to the assets,
business and/or Liabilities of the Marathon Group.
(n) "Person" or "Persons" shall mean and include
any individual, partnership, joint venture, corporation, association, joint
stock company, limited liability company, trust, unincorporated
organization or similar entity.
(o) "SEC" shall mean the United States
Securities and Exchange Commission.
(p) "Subsidiary" shall mean, with respect to any
Person, each corporation, partnership, limited liability company or other
legal entity of which such Person owns, either directly or indirectly, 50%
or more of the stock or other equity interests the holders of which are
generally entitled to vote for the election of the board of directors or
similar governing body of such corporation, partnership, limited liability
company or other legal entity.
(q) "USX Corporate Assets" shall mean assets
owned or leased by Old USX at the HoldCo Effective Time and which are not
designated in the accounting records of Old USX as being solely
attributable to either Group. Without limiting the foregoing, USX Corporate
Assets shall include those assets listed in Section 1.1(q) of the
Disclosure Letter.
(r) "USX Corporate Bank Accounts" shall mean the
bank and other accounts listed in Section 1.1(r) of the Disclosure Letter.
(s) "USX Corporate Employees" shall mean all
persons employed by Old USX at the HoldCo Effective Time who are designated
in the payroll records of Old USX as employees of USX headquarters.
(t) "USX Corporate Liabilities" shall mean the
Liabilities of Old USX as of the HoldCo Effective Time which are either (i)
listed in Section 1.1(t) of the Disclosure Letter, or (ii) which are
reflected in the accounting records of Old USX and are not attributed in
such records solely to either Group.
(u) "USX Employee Arrangements" shall mean the
Employee Arrangements to which Old USX is a party listed in Section 1.1(u)
of the Disclosure Letter.
(v) "USX Employee Incentive Plans" shall mean
all Employee Incentive Plans sponsored by Old USX or to which Old USX is a
party that are listed in Section 1.1(v) of the Disclosure Letter.
(w) "USX Trademark" shall mean the ▇▇▇▇ "USX" in
word form and all variations of the foregoing, including the registration
listed in Section 1.1(w) of the Disclosure Letter.
Section 1.2 Other Definitional Provisions.
(a) The words "hereof", "herein", "hereunder"
and words of similar import, when used in this Agreement, shall refer to
this Agreement as a whole and not to any particular provision of this
Agreement.
(b) The terms defined in the singular shall have
a comparable meaning when used in the plural, and vice versa.
(c) The terms "dollars" and "$" shall mean
United States dollars.
Section 1.3 Terms Defined Elsewhere in this Agreement.
For the purposes of this Agreement, the following terms have the meanings
set forth on the pages indicated:
6.50% Accumulated Dividends..................................................13
6.50% Preferred Shares........................................................1
Action........................................................................3
Agreement.....................................................................1
Applicable Law................................................................3
Board.........................................................................1
Cash..........................................................................3
Code..........................................................................2
Contract......................................................................3
CSE...........................................................................9
DGCL..........................................................................1
Disclosure Letter.............................................................3
DLLCA.........................................................................1
Employee Arrangements.........................................................3
Employee Incentive Plans......................................................3
Governmental Authority........................................................4
Group.........................................................................4
HoldCo Certificate of Merger.................................................11
HoldCo Closing...............................................................11
HoldCo Closing Date..........................................................11
HoldCo Effective Time........................................................11
HoldCo Merger.................................................................1
Joint Insurance Arrangements..................................................4
Liability.....................................................................4
Marathon......................................................................4
Marathon Group Shares.........................................................1
Marathon Insurance Arrangements...............................................4
Marathon SAR.................................................................15
New 6.50% Preferred Shares....................................................9
New Marathon Group Shares.....................................................9
New SteelCo Interest.........................................................13
New U. S. Steel Group Shares..................................................9
NYSE..........................................................................9
Old USX.......................................................................1
Person........................................................................4
PSE...........................................................................9
Restated Certificate..........................................................1
Restated LLC Agreement.......................................................12
Restated USX Certificate.....................................................10
SEC...........................................................................5
SteelCo.......................................................................1
SteelCo Interest.............................................................13
SteelCo LLC Agreement.........................................................9
Stockholder Rights Plan......................................................16
Subsidiary....................................................................5
Surviving Entity.............................................................11
Transactions..................................................................2
U. S. Steel Group Shares......................................................1
U. S. Steel Group Option.....................................................14
U. S. Steel SAR..............................................................15
USX...........................................................................1
USX By-Laws...................................................................8
USX Certificate...............................................................8
USX Corporate Assets..........................................................5
USX Corporate Employees.......................................................5
USX Corporation..............................................................10
USX Employee Arrangements.....................................................5
USX Employee Incentive Plans..................................................5
USX Trademark.................................................................5
ARTICLE II
THE HOLDCO MERGER
Section 2.1 Actions to be Taken Prior to the HoldCo
Merger. Prior to the HoldCo Effective Time, Old USX has taken, or has
caused to be taken, or shall take, or shall cause to be taken, the
following actions:
(a) Old USX has organized USX as a corporation,
pursuant to the DGCL, wholly owned by Old USX, with a certificate of
incorporation in the form of Appendix A hereto (the "USX Certificate") and
by-laws in the form of Appendix B hereto (the "USX By-Laws"). USX has no
assets or liabilities and has conducted no business, other than in
connection with its organization.
(b) Old USX shall contribute to USX all of its
right, title and interest in and to the following assets, effective at the
HoldCo Effective Time:
(i) all of the issued and outstanding
shares of common stock, no par value, of Marathon;
(ii) all of the issued and outstanding
shares of capital stock of USX Portfolio Delaware, Inc.;
(iii) all of the USX Corporate Bank
Accounts and all Cash of Old USX in the USX Corporate Bank
Accounts;
(iv) the Marathon Insurance
Arrangements and Joint Insurance Arrangements, as listed on
Section 2.1(b)(iv) of the Disclosure Letter;
(v) all USX Corporate Assets except
those listed on Section 2.1(b)(v) of the Disclosure Letter;
(vi) the USX Trademark; and
(vii) all of the other assets listed in
Section 2.1(b)(vii) of the Disclosure Letter.
(c) USX has formed SteelCo as a limited
liability company, pursuant to the DLLCA, wholly owned by USX, with a
limited liability company operating agreement in the form of Appendix C
hereto (the "SteelCo LLC Agreement"). SteelCo has no assets or liabilities
and has conducted no business, other than in connection with its formation.
(d) USX shall prepare and submit to the New York
Stock Exchange (the "NYSE"), the Pacific Stock Exchange (the "PSE") and the
Chicago Stock Exchange (the "CSE") an application (or amendment thereto)
for listing on the NYSE, the PSE and the CSE of the USX-U. S. Steel Group
Common Stock, par value $1.00 per share, of USX ("New U. S. Steel Group
Shares") to be issued to holders of U. S. Steel Group Shares in the HoldCo
Merger, and shall use its reasonable efforts to obtain, prior to the
HoldCo Effective Time, approval for the listing of such shares, subject to
official notice of issuance.
(e) USX shall prepare and submit to the NYSE,
the PSE and the CSE an application (or amendment thereto) for listing on
the NYSE, the PSE and the CSE of the USX-Marathon Group Common Stock, par
value $1.00 per share, of USX ("New Marathon Group Shares") to be issued to
holders of Marathon Group Shares in the HoldCo Merger, and shall use its
reasonable efforts to obtain, prior to the HoldCo Effective Time, approval
for the listing of such shares, subject to official notice of issuance.
(f) USX shall prepare and submit to the NYSE an
application (or amendment thereto) for listing on the NYSE of the 6.50%
Cumulative Convertible Preferred Stock, no par value, of USX ("New 6.50%
Preferred Shares") to be issued to holders of 6.50% Preferred Shares in the
HoldCo Merger, and shall use its reasonable efforts to obtain, prior to the
HoldCo Effective Time, approval for the listing of such shares, subject to
official notice of issuance.
(g) Old USX shall assign to USX, and USX shall
assume and agree to pay, perform and discharge when due, all USX Corporate
Liabilities, effective at the HoldCo Effective Time. Such assignment and
assumption of the USX Corporate Liabilities shall be effected by (i) USX
executing and delivering to Old USX one or more Assumption Agreements,
effective at the HoldCo Effective Time, in such form as Old USX and USX
determine to be appropriate, to evidence the assignment to, and assumption
by, USX of the USX Corporate Liabilities pursuant to this Section 2.1(g),
and (ii) complying with any other requirements or provisions of the USX
Corporate Liabilities that are necessary or appropriate to effect such
assignment and assumption.
(h) USX shall offer employment to all USX
Corporate Employees other than those listed on Section 2.1(h) of the
Disclosure Letter, and effective as of the HoldCo Effective Time, Old USX
hereby assigns to USX all of Old USX's right, title and interest in and to,
and, effective as of the HoldCo Effective Time, USX hereby assumes and
agrees to pay, perform and discharge when due, all of Old USX's Liabilities
arising under or relating to the USX Employee Arrangements.
(i) USX shall take all actions necessary to
amend and restate the USX Certificate in its entirety at the HoldCo
Effective Time, to read in its entirety as set forth in Appendix D hereto
(the "Restated USX Certificate"), to provide that, effective as of the
HoldCo Effective Time, (i) USX shall have the same capitalization of Old
USX, as set forth in the Restated Certificate, and (ii) the name of USX
shall be "USX Corporation."
(j) Old USX and USX shall take all actions as
are necessary to ensure that the directors of Old USX immediately prior to
the HoldCo Effective Time shall be the directors of USX as of the HoldCo
Effective Time and USX hereby acknowledges and agrees that such directors
shall hold office as directors of USX from and after the HoldCo Effective
Time until the earlier of their resignations or their respective successors
are duly elected or appointed and qualified in the manner provided for in
the Restated USX Certificate and the USX By-Laws, or as otherwise provided
by Applicable Law.
(k) Old USX and USX shall take all actions as
are necessary to ensure that the officers of Old USX in office immediately
prior to the HoldCo Effective Time who are USX Corporate Employees shall be
the officers of USX as of the HoldCo Effective Time and USX hereby
acknowledges and agrees that such officers shall hold office as officers of
USX from and after the HoldCo Effective Time until the earlier of their
resignation or removal or until their respective successors are duly
elected or appointed and qualified in the manner provided in the Restated
USX Certificate and the USX By-Laws, or as otherwise provided by Applicable
Law.
(l) USX shall assume and adopt in their
entirety, effective immediately prior to the HoldCo Effective Time, all USX
Employee Incentive Plans, and Old USX shall, and does hereby, consent to
such assumption and adoption by USX.
Section 2.2 The HoldCo Merger. At the HoldCo Effective
Time, upon the terms and subject to the conditions of this Agreement and in
accordance with Section 251(g) of the DGCL and Section 18-209 of the DLLCA,
Old USX shall be merged with and into SteelCo. Following the HoldCo
Effective Time, SteelCo shall continue as the surviving entity (the
"Surviving Entity") and as a wholly owned Subsidiary of USX and the
separate corporate existence of Old USX shall cease in accordance with the
DGCL.
Section 2.3 HoldCo Effective Time. Subject to the
provisions of this Agreement, the HoldCo Merger shall be consummated by
filing an appropriate certificate of merger (the "HoldCo Certificate of
Merger") with the Secretary of State of the State of Delaware in such form
as required by, and executed in accordance with, the relevant provisions of
the DGCL and the DLLCA as soon as practicable on or after the HoldCo
Closing Date (as defined in Section 2.4 below). The HoldCo Merger shall
become effective upon such filing or at such time thereafter as provided in
the HoldCo Certificate of Merger (the "HoldCo Effective Time").
Section 2.4 Closing of the HoldCo Merger. The closing of
the HoldCo Merger (the "HoldCo Closing") shall take place at the offices of
Old USX, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, at 8:30
a.m. (local time), on a date to be specified by the parties, which shall be
as soon as practicable after satisfaction or waiver (to the extent and in
the manner permitted by this Agreement and Applicable Law) of all of the
conditions to the HoldCo Merger set forth in Section 3.1 hereof (the
"HoldCo Closing Date"), unless the parties agree to another time, date or
place in writing.
Section 2.5 Effects of the HoldCo Merger.
(a) The HoldCo Merger shall have the effects set
forth in Section 259 of the DGCL and Section 18-209(g) of the DLLCA.
Without limiting the generality of the foregoing, and subject thereto, at
the HoldCo Effective Time, all properties, rights, privileges, powers and
franchises of Old USX shall vest in SteelCo, and, subject to Section 2.1(g)
hereof, all Liabilities, debts and duties of Old USX shall become the
Liabilities, debts and duties of SteelCo.
(b) Except as expressly provided herein, or in
the Assumption Agreements contemplated in Section 2.1(g) hereof, USX is
not assuming, and does not intend to assume, any Liability of Old USX.
Section 2.6 Organizational Documents.
(a) At the HoldCo Effective Time, without any
further action on the part of SteelCo or Old USX, the SteelCo LLC
Agreement, as in effect immediately prior to the HoldCo Effective Time,
shall be amended and restated in its entirety to read as set forth in
Appendix E hereto and, as so amended, shall be the limited liability
company operating agreement of SteelCo (the "Restated LLC Agreement"),
until thereafter amended as provided therein or by the DLLCA.
(b) USX hereby covenants and agrees that the
Restated USX Certificate and the USX By-Laws shall be the certificate of
incorporation and by-laws, respectively, of USX from and after the HoldCo
Effective Time, until thereafter amended as provided by the DGCL and such
Restated USX Certificate and USX By-Laws.
Section 2.7 Directors. The directors of SteelCo
immediately prior to the HoldCo Effective Time shall be the directors of
SteelCo from and after the HoldCo Effective Time and shall hold office
until the earlier of their resignations or removal or their respective
successors are duly elected or appointed and qualified in the manner
provided for in the Restated LLC Agreement, or as otherwise provided by
Applicable Law.
Section 2.8 Officers. The officers of SteelCo immediately
prior to the HoldCo Effective Time shall be the officers of SteelCo from
and after the HoldCo Effective Time and shall hold office until the earlier
of their resignation or removal or their respective successors are duly
elected or appointed and qualified in the manner provided in the Restated
LLC Agreement, or as otherwise provided by Applicable Law.
Section 2.9 Conversion of Securities. At the HoldCo
Effective Time, by virtue of the HoldCo Merger and without any action on
the part of any holder thereof:
(a) U. S. Steel Group Shares. Each U. S. Steel
Group Share issued and outstanding or held in the treasury of Old USX or by
any Subsidiary of Old USX immediately prior to the HoldCo Effective Time
shall be converted into and thereafter represent one duly issued, fully
paid and nonassessable New U. S. Steel Group Share.
(b) Marathon Group Shares. Each Marathon Group
Share issued and outstanding or held in the treasury of Old USX or by any
Subsidiary of Old USX immediately prior to the HoldCo Effective Time shall
be converted into and thereafter represent one duly issued, fully paid and
nonassessable New Marathon Group Share.
(c) SteelCo Limited Liability Company Interests.
Each limited liability company interest of SteelCo ("SteelCo Interest")
issued and outstanding immediately prior to the HoldCo Effective Time
shall remain outstanding, unaffected by the HoldCo Merger, and thereafter
represent one duly issued limited liability company interest in the
Surviving Entity ("New SteelCo Interest").
(d) USX Common Stock. Each share of common
stock, par value $.01 per share, of USX issued and outstanding immediately
prior to the HoldCo Effective Time shall automatically be cancelled and
retired and shall cease to exist without payment of any consideration
therefor.
(e) 6.50% Preferred Shares. Each 6.50% Preferred
Share, issued and outstanding immediately prior to the HoldCo Effective
Time shall be converted into and thereafter represent one validly issued,
fully paid and nonassessable New 6.50% Preferred Share, and shall
thereafter be entitled to the same rights, preferences and privileges as
set forth in the Restated Certificate, except that all references therein
to the Marathon Group Shares and the U. S. Steel Group Shares shall be
deemed to be references to the New Marathon Group Shares and New U. S.
Steel Group Shares, respectively. The rights to accrued, accumulated and
unpaid dividends on each outstanding 6.50% Preferred Share shall be
preserved, unimpaired, unchanged, and unaffected by such conversion in the
HoldCo Merger (the "6.50% Accumulated Dividends"). The 6.50% Accumulated
Dividends shall carry over, pertain to and become accrued, accumulated, and
unpaid dividends on each such New 6.50% Preferred Share, notwithstanding
that such dividends shall have accrued and accumulated from a date prior to
the issuance of New 6.50% Preferred Shares.
Section 2.10 No Surrender of Certificates; Rights of
Certificate Holders. From and after the HoldCo Effective Time, holders of
certificates formerly evidencing U. S. Steel Group Shares or Marathon Group
Shares shall cease to have any rights as stockholders of Old USX and:
(a) each outstanding stock certificate that,
immediately prior to the HoldCo Effective Time, evidenced U. S. Steel Group
Shares shall be deemed and treated for all corporate purposes to evidence
the ownership of the number of New U. S. Steel Group Shares into which such
U. S. Steel Group Shares were converted pursuant to the provisions of
Section 2.9(a) hereof;
(b) each outstanding stock certificate that,
immediately prior to the HoldCo Effective Time, evidenced Marathon Group
Shares shall be deemed and treated for all corporate purposes to evidence
the ownership of the number of New Marathon Group Shares into which such
Marathon Group Shares were converted pursuant to the provisions of Section
2.9(b) hereof; and
(c) each outstanding stock certificate that,
immediately prior to the HoldCo Effective Time, evidenced 6.50% Preferred
Stock shall be deemed and treated for all corporate purposes to evidence
the ownership of the number of shares of New 6.50% Preferred Stock into
which such shares of 6.50% Preferred Stock were converted pursuant to the
provisions of Section 2.9(e) hereof.
Section 2.11 Treatment of USX Stock Options and Stock
Appreciation Rights.
(a) U. S. Steel Group Options. Each option to
purchase U. S. Steel Group Shares which has been granted under the USX
Corporation 1990 Stock Plan and is outstanding and unexercised immediately
prior to the HoldCo Effective Time, whether or not vested or exercisable
("U. S. Steel Group Option") shall, without any further action on the part
of Old USX or any holder thereof, be assumed as of the HoldCo Effective
Time by USX and deemed to constitute an option to purchase the same number
of New U. S. Steel Group Shares as was subject to the U. S. Steel Group
Option being assumed, at the same exercise price, for the same remaining
period, and otherwise subject to the same terms and conditions (including
those relating to vesting) applicable to the U. S. Steel Group Option being
assumed.
(b) U. S. Steel Stock Appreciation Rights. Each
stock appreciation right relating to U. S. Steel Group Shares which has
been granted under the USX Corporation 1990 Stock Plan and is outstanding
and unexercised immediately prior to the HoldCo Effective Time, whether or
not vested or exercisable ("U. S. Steel SAR"), shall, without any further
action on the part of Old USX or any holder thereof, be assumed as of the
HoldCo Effective Time by USX and deemed to constitute a stock appreciation
right with respect to New U. S. Steel Group Shares, which shall otherwise
be subject to the same terms and conditions applicable to the U. S. Steel
SAR being assumed.
(c) Marathon Group Options. Each option to
purchase Marathon Group Shares which has been granted under the USX
Corporation 1990 Stock Plan and is outstanding and unexercised immediately
prior to the HoldCo Effective Time, whether or not vested or exercisable
("Marathon Group Option"), shall, without any further action on the part of
Old USX or any holder thereof, be assumed as of the HoldCo Effective Time
by USX and deemed to constitute an option to purchase the same number of
New Marathon Group Shares as was subject to the Marathon Group Option being
assumed, at the same exercise price, for the same remaining period, and
otherwise subject to the same terms and conditions (including those
relating to vesting) applicable to the Marathon Group Option being assumed.
(d) Marathon Stock Appreciation Rights. Each
stock appreciation right relating to Marathon Group Shares which has been
granted under the USX Corporation 1990 Stock Plan and is outstanding and
unexercised immediately prior to the HoldCo Effective Time, whether or not
vested or exercisable ("Marathon SAR"), shall, without any further action
on the part of Old USX or any holder thereof, be assumed as of the HoldCo
Effective Time by USX and deemed to constitute a stock appreciation right
with respect to New Marathon Group Shares, which shall otherwise be subject
to the same terms and conditions applicable to the Marathon SAR being
assumed.
Section 2.12 Treatment of Restricted Stock. Effective as
of the HoldCo Effective Time, all restricted U. S. Steel Group Shares and
restricted Marathon Group Shares granted under the USX Corporation 1990
Stock Plan and outstanding immediately prior to the HoldCo Effective Time
shall be converted into restricted New U. S. Steel Group Shares and
restricted New Marathon Group Shares pursuant to Section 2.9 (a) and (b),
respectively. After the HoldCo Effective Time, such restricted shares shall
be subject to the same terms and conditions (including those relating to
vesting) as were applicable to such restricted shares prior to the HoldCo
Merger.
Section 2.13 Assumption of Rights Agreement. Upon and as
of the HoldCo Effective Time, Old USX shall assign to USX all of its right,
title and interest in and to, and USX shall assume and agree to perform and
discharge when due, all of the obligations of Old USX under, the Rights
Agreement, dated as of September 28, 1999, between Old USX and ChaseMellon
Shareholder Services, L.L.C., as Rights Agent (the "Stockholder Rights
Plan"). Such assignment and assumption shall be effected by Old USX, USX
and the Rights Agent entering into an amendment to the Stockholder Rights
Plan, in such form as the parties deem appropriate, evidencing such
assignment and assumption.
Section 2.14 Subsequent Actions. Subject to the terms of
this Agreement, the parties hereto shall take all such reasonable and
lawful actions as may be necessary or appropriate in order to effectuate
the HoldCo Merger. If, at any time after the HoldCo Effective Time, SteelCo
or USX shall determine or be advised that any deeds, bills of sale,
assignments, assurances or any other actions or things are necessary or
desirable to vest, perfect or confirm of record or otherwise in
SteelCo its right, title or interest in, to or under any of the rights,
properties or assets of Old USX acquired or to be acquired by SteelCo as a
result of, or in connection with, the HoldCo Merger or otherwise to carry
out this Agreement, the officers and directors of SteelCo and USX shall be
authorized to execute and deliver, in the name and on behalf of either
SteelCo or Old USX, all such deeds, bills of sale, instruments of
conveyance, assignments and assurances, and to take and do, in the name and
on behalf of SteelCo, Old USX or otherwise, all such other actions and
things as may be necessary or desirable to vest, perfect or confirm any and
all right, title and interest in, to and under such rights, properties or
assets in SteelCo or otherwise to carry out this Agreement.
Section 2.15 Actions to be Taken Following the HoldCo
Merger. Following the HoldCo Effective Time, USX shall take, or cause to be
taken, the following actions:
(a) Promptly following the HoldCo Effective
Time, USX shall file with the SEC (i) a Current Report on Form 8-K
reporting completion of the HoldCo Merger and (ii) post-effective
amendments to any Forms S-8 and S-3 of Old USX that are then effective, in
order to update such previously filed registration statements of Old USX to
effect their assumption by USX as a successor issuer to Old USX.
(b) Following the HoldCo Effective Time, the
board of directors of USX shall adopt such resolutions as it deems
necessary or appropriate to adopt the corporate procedures, authorizations
and policies of Old USX that were approved by the Board prior to the HoldCo
Effective Time.
(c) Following the HoldCo Effective Time, the
board of directors of SteelCo shall adopt such resolutions as it deems
necessary or appropriate to adopt the corporate procedures, authorizations
and policies of the U. S. Steel Group that were approved by the board of
directors of the U. S. Steel Group prior to the HoldCo Effective Time.
ARTICLE III
CONDITIONS
Section 3.1 Conditions to the HoldCo Merger. The
respective obligations of Old USX and SteelCo to effect the HoldCo Merger
are subject to the satisfaction or waiver (to the extent and as permitted
by this Agreement and Applicable Law) of each of the following conditions:
(a) Listing of New U. S. Steel Group Shares. The
New U. S. Steel Group Shares to be issued in the HoldCo Merger shall have
been approved for listing on the NYSE, the PSE and the CSE, subject to
official notice of issuance.
(b) Listing of New Marathon Group Shares. The
New Marathon Group Shares to be issued in the HoldCo Merger have been
approved for listing on the NYSE, the PSE and the CSE, subject to official
notice of issuance.
(c) Listing of New 6.50% Preferred Shares. The
New 6.50% Preferred Shares to be issued in the HoldCo Merger have been
approved for listing on the NYSE, subject to official notice of issuance.
(d) No Injunctions. No order, injunction or
decree shall have been issued by any Governmental Authority and remain in
effect which prohibits or prevents the consummation of the HoldCo Merger.
(e) Consents. All material consents,
authorizations and approvals of, and filings with, any Governmental
Authority or any other Person required to consummate the HoldCo Merger
shall have been obtained and be in full force and effect.
Section 3.2 Determination as to Fulfillment of
Conditions. All determinations to be made concerning satisfaction or waiver
of the conditions set forth in this Article III shall be made by the Board,
in its sole discretion, on behalf of each of the parties hereto, and shall
be final and conclusive.
ARTICLE IV
TERMINATION AND AMENDMENT
Section 4.1 Termination at any Time by the Board. This
Agreement may be terminated and the Transactions, including, without
limitation, the HoldCo Merger, may be abandoned at any time prior to the
HoldCo Effective Time, by and in the sole discretion of the Board, without
the approval of any other party hereto or of Old USX's stockholders. In the
event of such termination, no party hereto shall have any liability to any
Person by reason of this Agreement.
Section 4.2 Amendment. This Agreement may be amended,
modified or supplemented at any time as determined by the Board, and shall
be evidenced by a written agreement signed by all of the parties hereto.
ARTICLE V
GENERAL PROVISIONS
Section 5.1 Assignment of Contracts or Rights.
(a) Notwithstanding anything contained herein to
the contrary, this Agreement shall not constitute an agreement to transfer,
convey or assign any Contract or any claim or right or any benefit arising
under or resulting from such Contract if an attempted assignment thereof,
without the consent of a third party, would constitute a breach or other
contravention of the rights of such third party, or would in any way
adversely affect the rights of the parties hereto under such Contract. If
any conveyance, transfer or assignment of any interest in, or Liability,
obligation or commitment under, any Contract requires the consent of a
third party, then such assignment or assumption shall be made subject to
such consent being obtained.
(b) Subject to the satisfaction or waiver, to
the extent permitted by Applicable Law, of the conditions to the HoldCo
Merger set forth in Section 3.1, if any consent referred to in subsection
(a) above is not obtained prior to the HoldCo Effective Time, USX and
SteelCo shall cooperate (at their own expense) in any lawful and reasonable
arrangement reasonably proposed by either party under which the party who
is intended, under the terms of this Agreement, to receive an assignment of
such Contract shall obtain the economic claims, rights and benefits
under the Contract with respect to which the consent has not been obtained
in accordance with this Agreement. Such reasonable arrangement may include
(i) the subcontracting, sublicensing or subleasing of any and all rights
under such Contract and (ii) the enforcement by either party of such rights
under such Contract.
Section 5.2 Governing Law. This Agreement shall be
governed by, and construed in accordance with, the laws of Delaware,
without reference to choice of law principles, including matters of
construction, validity and performance.
Section 5.3 Notices. Notices, requests, permissions,
waivers, referrals and all other communications hereunder shall be in
writing and shall be deemed to have been duly given if signed by the
respective persons giving them (in the case of any limited liability
company or corporation the signature shall be by an officer thereof) and
delivered by hand or by telecopy or on the date of receipt indicated on the
return receipt if mailed (registered or certified, return receipt
requested, properly addressed and postage prepaid):
If to SteelCo, to:
United States Steel LLC
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: General Counsel
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
If to Old USX or USX, to:
USX Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: General Counsel
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Such names and addresses may be changed by notice given in accordance with
this Section 5.3. Copies of all notices, requests, permissions, waivers,
referrals and all other communications hereunder given prior to the HoldCo
Effective Time shall be given to:
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esquire
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Section 5.4 Third-Party Beneficiaries. Nothing in this
Agreement shall confer any rights upon any Person or entity other than the
parties hereto and their respective heirs, successors and permitted
assigns. Without limiting the foregoing, the inclusion of any matter within
the defined term "USX Corporate Liability" is merely for purposes of
allocating responsibility for such matter as between the parties hereto and
such inclusion does not and is not intended to acknowledge legal
enforceability or waive any defenses.
Section 5.5 Entire Agreement. This Agreement, together
with the Disclosure Letter and all schedules, appendices, certificates,
instruments and agree ments delivered pursuant hereto and thereto, contain
the entire understanding of the parties hereto and thereto with respect to
the subject matter contained herein and therein, and supersede and cancel
all prior agreements, negotiations, correspondence, undertakings and
communications of the parties, oral or written, respecting such subject
matter.
Section 5.6 Headings. The article, section and paragraph
headings contained in this Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this
Agreement. All references herein to "Articles", "Sections" or "Appendices"
shall be deemed to be references to Articles or Sections hereof or
Appendices hereto unless otherwise indicated. All references herein to
"Sections" of the Disclosure Letter shall be deemed to be references to the
Disclosure Letter unless otherwise indicated.
Section 5.7 Schedules. The Disclosure Letter and all
Appendices referenced in this Agreement and attached hereto are
incorporated into this Agreement by reference and made a part hereof.
Section 5.8 Counterparts. This Agreement may be executed
in one or more counterparts and each counterpart shall be deemed to be an
original, but all of which shall constitute one and the same original.
Section 5.9 Parties in Interest; Assignment; Successors.
Neither this Agreement nor any of the rights, interests or obligations
hereunder shall be assigned by any of the parties hereto without the prior
written consent of the other parties. Subject to the preceding sentence,
this Agreement shall inure to the benefit of and be binding upon Old USX,
SteelCo and USX and their respective successors and permitted assigns.
Nothing in this Agreement, express or implied, is intended to confer upon
any other Person any rights or remedies under or by reason of this
Agreement.
Section 5.10 Severability; Enforcement. The invalidity of
any portion hereof shall not affect the validity, force or effect of the
remaining portions hereof. If it is ever held that any restriction
hereunder is too broad to permit enforcement of such restriction to its
fullest extent, each party agrees that a court of competent jurisdiction
may enforce such restriction to the maximum extent permitted by law, and
each party hereby consents and agrees that such scope may be judicially
modified accordingly in any proceeding brought to enforce such restriction.
Each party hereby consents to the exclusive jurisdiction of the Court of
Chancery of the State of Delaware, the Court of Common Pleas of New Castle
County, Delaware or the United States District Court for the District of
Delaware to resolve any disputes under this Agreement and all parties waive
any and all defenses that they may have to challenge the jurisdiction or
venue of such courts.
IN WITNESS WHEREOF, each of the parties has caused this Holding
Company Reorganization Agreement to be duly executed on its behalf by its
officers thereunto duly authorized, all as of the day and year first above
written.
USX CORPORATION
By: /s/ E. F. Guna
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Name: E. F. Guna
Title: Vice President & Treasurer
USX HOLDCO, INC.
By: /s/ ▇. ▇. ▇▇▇▇▇▇▇
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Name: ▇. ▇. ▇▇▇▇▇▇▇
Title: President
UNITED STATES STEEL LLC
By: /s/ ▇. ▇. ▇▇▇▇▇▇▇
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Name: ▇. ▇. ▇▇▇▇▇▇▇
Title: President