Exhibit 99.1.1
Press Release Source: WHX Corporation
WHX ANNOUNCES ACQUISITION OF FASTENER ROOFING BUSINESS, RECEIPT OF
PENSION PLAN FUNDING WAIVER FROM IRS, SETTLEMENT WITH PBGC, AMENDMENT TO CREDIT
FACILITIES AND FILING OF ITS 2005 FORM 10-K
Friday December 29, 11:12 am ET
RYE, N.Y., Dec. 29 /PRNewswire-FirstCall/ -- WHX Corporation (Pink
Sheets: WXCP.PK - News) announced today that OMG Inc., a subsidiary of WHX's
wholly-owned subsidiary, Handy & Harman, acquired a mechanical roofing fastener
business from Illinois Tool Works Inc. for $26 million, including a working
capital adjustment, on December 28, 2006. This acquired business develops and
manufactures fastening systems for the commercial roofing industry. WHX believes
this acquisition solidifies OMG's position as a leading manufacturer and
supplier of mechanical fasteners, accessories and components, and building
products for the commercial and residential construction industry.
WHX further announced that the Internal Revenue Service had granted a
waiver of the minimum funding standards for the WHX Pension Plan for the 2005
Plan year and on December 28, 2006, WHX and Handy & Harman had entered into a
Settlement Agreement with the Pension Benefit Guaranty Corporation (the "PBGC")
in connection with the waiver and certain other matters. The PBGC Settlement
Agreement and related agreements provide, in part, for (i) the amortization of
the waived amount of $15.5 million (the "Waiver Amount") over a period of five
years, (ii) the PBGC's consent to the increase in borrowings under Handy &
Harman's senior credit facility to $125 million in connection with the closing
of the acquisition described above, (iii) the resolution of any potential issues
under Section 4062(e) of the Employee Retirement Income Security Act of 1974, as
amended, in connection with the cessation of operations at certain facilities
owned by WHX, Handy & Harman or their subsidiaries, and (iv) the granting to the
PBGC of subordinate liens on the assets of Handy & Harman and its subsidiaries,
and specified assets of WHX, to secure WHX's obligation to pay the Waiver Amount
to the WHX Pension Plan and to make certain payments to the WHX Pension Plan in
the event of its termination.
In connection with the roofing fastener acquisition and the PBGC
settlement described above, Handy & Harman, and certain of its subsidiaries,
amended its Loan and Security Agreement with Wachovia Bank, National Association
and its Loan and Security Agreement with its Tranche B Term Loan lender. The
amendments provided, in part, for (i) an additional $42 million term loan, a
portion of which was used to fund the roofing acquisition, and (ii) consent to
the PBGC Settlement Agreement and related matters.
WHX also announced that it had filed its Annual Report on Form 10-K for
the year ended December 31, 2005 on December 27, 2006. WHX anticipates filing
its Annual Report on Form 10-K for the year ended December 31, 2004, as well its
Quarterly Reports on Form 10-Q for 2005 and 2006, during the first quarter of
2007.
At December 31, 2005, WHX had federal net operating loss carryforwards
(NOL's) of approximately $120.3 million. These NOL's expire between 2006 and
2025. Upon its emergence from bankruptcy on July 29, 2005, WHX experienced an
ownership change as defined by Section 382 of the Internal Revenue Code, which
imposes annual limitations on the utilization of NOL's post ownership change.
WHX believes it qualifies for the bankruptcy exception to the general Section
382 limitations. Additionally, if WHX should undergo a second ownership change
within two years of July 29, 2005 (the date of the reorganization) its remaining
net operating losses would effectively be reduced to zero. Accordingly, in order
to avoid subsequent ownership changes, WHX's charter contains a 5% ownership
limit pursuant to which transfers of WHX's shares will be limited under certain
circumstances, including without limitation if as a result of such transfer a
stockholder becomes a 5% stockholder, or the percentage ownership of an existing
5% stockholder would be increased.
Forward-Looking Statements
This press release contains 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, which are intended to be
covered by the safe harbors created thereby. Investors are cautioned that all
forward-looking statements involve risks and uncertainty, including without
limitation, general economic conditions, the ability of the Company to market
and sell its products, and the effects of competition and pricing. Although the
Company believes that the assumptions underlying the forward-looking statements
are reasonable, any of the assumptions could be inaccurate, and therefore, there
cannot be assurance that any forward-looking statements included in this press
release will prove to be accurate. In light of the significant uncertainties
inherent in any forward-looking statements included herein, the inclusion of
such information should not be regarded as a representation by the Company or
any other person that the objectives and plans of the Company will be achieved.
