WHX Corporation Announces Debt Refinancing

WHITE PLAINS, N.Y., Oct 18 /PRNewswire-FirstCall/ -- WHX Corporation (Nasdaq (CM): WXCO) ("WHX"), a diversified global industrial company, today announced that it has successfully refinanced substantially all of its indebtedness principally with its existing lenders or their affiliates.  The refinancing was effected through a newly formed, wholly-owned subsidiary of WHX, Handy & Harman Group Ltd. ("H&H Group"), which is the direct parent of Handy & Harman ("H&H") and Bairnco Corporation ("Bairnco").

On October 15, 2010, H&H Group, together with its subsidiaries, entered into an Amended and Restated Loan and Security Agreement with Wells Fargo Bank, National Association ("Wells Fargo"), as administrative agent for the lenders thereunder, pursuant to which Wells Fargo extended a $21 million senior term loan to H&H Group (the "First Lien Term Loan") and made available a revolving credit facility in the maximum aggregate principal amount of $89 million (the "First Lien Revolver"). The First Lien Term Loan bears interest on the principal amount thereof at a rate of LIBOR plus 3.25% per annum and amounts outstanding under the First Lien Revolver bear interest at LIBOR plus 2.75% per annum.  All amounts outstanding under the Wells Fargo facility are due and payable in full on June 30, 2012.  The Wells Fargo facility amended and restated the prior Loan and Security Agreement between H&H and its subsidiaries and Wells Fargo (as successor-in-interest to Wachovia Bank, National Association), as agent, and replaced the prior Wells Fargo credit facility with Bairnco and its subsidiaries.  

H&H Group and its subsidiaries also entered into a Loan and Security Agreement on October 15, 2010 with Ableco, L.L.C. (“Ableco”), as administrative agent for the lenders thereunder, pursuant to which Ableco extended a $25 million subordinated term loan to H&H Group (the “Second Lien Term Loan”).  The Second Lien Term Loan bears interest on the principal amount thereof at floating rate based on LIBOR, with a minimum rate of 10.75% per annum. All amounts outstanding under the Ableco facility are due and payable in full on June 30, 2012.  The Ableco facility replaced the prior financing arrangements between Ableco and H&H and its subsidiaries and Bairnco and its subsidiaries.

In addition, on October 15, 2010, H&H Group refinanced the prior indebtedness of H&H and Bairnco to the Steel Partners II Liquidating Series Trust (the "Steel Trusts") in accordance with the terms of an Exchange Agreement, pursuant to which H&H Group made an approximately $6 million cash payment in partial satisfaction of prior indebtedness to the Steel Trusts and exchanged the remainder of such prior obligations for units consisting of (a) $72,925,500 aggregate principal amount of 10% subordinated secured notes due 2017 (the "Subordinated Notes") issued by H&H Group pursuant to an Indenture, dated as of October 15, 2010, by and among H&H Group, the Guarantors party thereto and Wells Fargo, as trustee, and (b) warrants (the "Warrants") to purchase an aggregate of 1,500,806 shares of WHX common stock.  The Warrants have an exercise price of $11.00 per share and are exercisable beginning October 14, 2013.  The Subordinated Notes bear interest at a rate of 10%, 6% of which is payable in cash and 4% of which is payable in-kind. The Subordinated Notes, together with any accrued and unpaid interest thereon, mature on October 15, 2017.  The Subordinated Notes and Warrants were issued in reliance on an exemption from the registration requirements of the Securities Exchange Act of 1933, as amended.

All amounts owed under the Wells Fargo facility, the Ableco facility and the Subordinated Notes are guaranteed by substantially all of H&H Group's subsidiaries and are secured by substantially all of their assets.

"We are pleased with the continued commitment by our principal lenders," said Glen M. Kassan, Vice Chairman and Chief Executive Officer of WHX.  "This refinancing will lower our ongoing borrowing costs compared to our prior financing arrangements and extend the maturity date of almost all of our indebtedness."

Our Company

WHX Corporation is a diversified global industrial company delivering value through the WHX Business System which drives innovation, operating excellence and superior customer service. WHX and its affiliated companies employ over 1,700 people at 30 locations in eight countries.

Our companies are organized into six businesses: Precious Metals, Tubing, Engineered Materials, Arlon Electronic Materials, Arlon Coated Materials and Kasco.

We sell our products and services through direct sales forces, distributors and manufacturer's representatives. We serve a diverse customer base, including the construction, electronics, telecommunications, home appliance, transportation, utility, medical, semiconductor, and aerospace and aviation markets. Other markets served include the signage industry and meat room products and maintenance services for the food industry.

We are based in White Plains, New York and our common stock is listed on the NASDAQ Capital Market under the symbol WXCO.

Forward-Looking Statements

This press release contains certain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), that reflect WHX's current expectations and projections about its future results, performance, prospects and opportunities. WHX has tried to identify these forward-looking statements by using words such as "may," "should," "expect," "hope," "anticipate," "believe," "intend," "plan," "estimate" and similar expressions. These forward-looking statements are based on information currently available to the Company and are subject to a number of risks, uncertainties and other factors, that could cause its actual results, performance, prospects or opportunities in 2010 and beyond to differ materially from those expressed in, or implied by, these forward-looking statements. These factors include, without limitation, WHX's need for additional financing and the terms and conditions of any financing that is consummated, customers' acceptance of its new and existing products, the risk that the Company will not be able to compete successfully, and the possible volatility of the Company's stock price and the potential fluctuation in its operating results. Although WHX believes that the expectations reflected in these forward-looking statements are reasonable and achievable, such statements involve significant risks and uncertainties and no assurance can be given that the actual results will be consistent with these forward-looking statements. Investors should read carefully the factors described in the "Risk Factors" section of the Company's filings with the SEC, including the Company's Form 10-K for the year ended December 31, 2009 for information regarding risk factors that could affect the Company's results. Except as otherwise required by Federal securities laws, WHX undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.

SOURCE WHX Corporation

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