Exhibit 10.1

 

LOGO [g73560image_001.jpg]

 

    Allen & Overy Bratislava, s.r.o.    

FACILITY AGREEMENT

    €195,000,000     CREDIT FACILITY     FOR     U. S. Steel Košice, s.r.o.    
ARRANGED BY     ING BANK N.V., pobočka zahraničnej banky     CITIBANK, N.A.
Bahrain     Slovenská sporitel’ňa, a.s.     WITH ING BANK N.V. AS FACILITY AGENT
   

15 DECEMBER 2005

--------------------------------------------------------------------------------

CONTENTS

 

Clause

--------------------------------------------------------------------------------

        Page

--------------------------------------------------------------------------------

1.

   Interpretation    1

2.

   Facility    10

3.

   Purpose    11

4.

   Conditions precedent    11

5.

   Utilisation - Loans    11

6.

   Optional Currencies    12

7.

   Repayment    14

8.

   Prepayment and cancellation    14

9.

   Interest    17

10.

   Terms    18

11.

   Market disruption    18

12.

   Taxes    19

13.

   Increased Costs    21

14.

   Mitigation    22

15.

   Payments    22

16.

   Representations and Warranties    24

17.

   Undertakings    28

18.

   Events of Default    32

19.

   The Administrative Parties    34

20.

   Evidence and Calculations    39

21.

   Fees    39

22.

   Indemnities and Break Costs    40

23.

   Expenses    41

24.

   Amendments and waivers    42

25.

   Changes to the Parties    43

26.

   Disclosure of Information    45

27.

   Set-off    46

28.

   Pro rata sharing    46

29.

   Severability    47

30.

   Counterparts    47

31.

   Notices    47

32.

   Language    48

33.

   Waiver of Immunity    49

34.

   Governing law    49

35.

   Enforcement    49 Schedule     

1.

   Original Parties    51

2.

   Form of Request    52

3.

   Form of Transfer Certificate    53

4.

   Conditions Precedent Documents    54

5.

   Form of Legal Opinion of Legal Adviser to the Company    55

6.

   Form Of Legal Opinion of Allen & Overy – Slovak Law    59

7.

   Form of Legal Opinion of Allen & Overy – English Law    64

Signatories

   67

--------------------------------------------------------------------------------

THIS AGREEMENT is dated 15 December 2005 BETWEEN:

 

(1) U. S. Steel Košice, s.r.o., with its registered seat at Vstupný areál U. S.
Steel, Košice 044 54, Slovak Republic, registered in the Commercial Register of
District Court Košice I, insert No. 11711/V, section Sro, company identification
number (IČO): 36 199 222 (the Company);

 

(2) CITIBANK, N.A. Bahrain, ING BANK N.V., pobočka zahraničnej banky AND
Slovenská sporitel’ňa, a.s. as mandated lead arrangers (in this capacity the
Arrangers);

 

(3) THE FINANCIAL INSTITUTIONS listed in Part I of Schedule 1 (Original Lenders)
as original lenders (the Original Lenders); and

 

(4) ING BANK N.V. as facility agent (in this capacity the Facility Agent).

 

IT IS AGREED as follows:

 

1. INTERPRETATION

 

1.1 Definitions

 

   In this Agreement:

 

   Administrative Party means each Arranger and the Facility Agent.

 

   Affiliate means a Subsidiary or a Holding Company of a person or any other
Subsidiary of that Holding Company.

 

   Assets means a person’s present and future business, undertaking, properties,
assets and revenues (including any uncalled capital).

 

   Availability Period means the period from and including the date of this
Agreement to and including the date one calendar month before the Final Maturity
Date.

 

   Break Costs means the amount (if any) which a Lender is entitled to receive
under this Agreement as compensation if any part of a Loan or overdue amount is
prepaid as calculated in accordance with Clause 22.3(b).

 

   Business Day means a day (other than a Saturday or a Sunday) on which banks
are open for general business in London, in New York and in Bratislava and:

 

  (a) if on that day a payment in or a purchase of a currency (other than euro)
is to be made, the principal financial centre of the country of that currency;
or

 

  (b) if on that day a payment in or a purchase of euro is to be made, which is
also a TARGET Day.

 

   Central Bank means the National Bank of Slovakia.

 

   Commitment means:

 

  (a) for an Original Lender, the amount set opposite its name in Schedule 1
(Original Parties) under the heading Commitments and the amount of any other
Commitment it acquires; and

 

  (b) for any other Lender, the amount of any Commitment it acquires, to the
extent not cancelled, transferred or reduced under this Agreement.

 

1

--------------------------------------------------------------------------------

   Default means an Event of Default or an event or circumstance which, with the
giving of notice, lapse of time or fulfilment of any other applicable condition
(or any combination of the foregoing) set out in Clause 18 (Events of Default),
would constitute an Event of Default.

 

   Dollars and USD mean the lawful currency for the time being of the United
States of America.

 

   ERISA means the United States Employee Retirement Income Security Act of
1974, to which the following definitions apply:

 

     - Code means the United States Internal Revenue Code of 1986.

 

     - ERISA Affiliate means any person treated as a single employer with the
Company for the purpose of section 414 of the Code.

 

     - Plan means an employee benefit plan as defined in section 3(3) of ERISA:

 

  (a) maintained by the Company or any ERISA Affiliate; or

 

  (b) to which the Company or any ERISA Affiliate is required to make any
payment or contribution.

 

     - Reportable Event means:

 

  (a) an event specified as such in section 4043 of ERISA or any related
regulation, other than an event in relation to which the requirement to give
notice of that event is waived by any regulation; or

 

  (b) a failure to meet the minimum funding standard under section 412 of the
Code or section 302 of ERISA, whether or not there has been any waiver of notice
or waiver of the minimum funding standard under section 412 of the Code.

 

   EURIBOR means for any Loan or overdue amount in euro:

 

  (a) the applicable Screen Rate; or

 

  (b) if no Screen Rate is available for the Term of that Loan or overdue
amount, the arithmetic mean (rounded upward to four decimal places) of the rates
as supplied to the Facility Agent at its request quoted by the Reference Banks
to leading banks in the relevant interbank market,

 

   as of 11.00 a.m. (Central European time (CET)) on the Rate Fixing Day for the
offering of deposits in euro for a period comparable to its Term.

 

   euro means the single currency of the Participating Member States.

 

   Event of Default means an event specified as such in Clause 18 of this
Agreement.

 

   Existing Facility refers to the facility with the Company as borrower, dated
17 December 2001 as amended.

 

   Facility means the credit facility made available under this Agreement.

 

   Facility Office means the office(s) notified by a Lender to the Facility
Agent:

 

  (a) on or before the date it becomes a Lender; or

 

2

--------------------------------------------------------------------------------

  (b) by not less than five Business Days’ notice,

 

   as the office(s) through which it will perform its obligations under this
Agreement.

 

   Fee Letter means any letter entered into by reference to this Agreement
between one or more Administrative Parties and the Company setting out the
amount of certain fees referred to in this Agreement.

 

   Final Maturity Date means the first anniversary of the date of this
Agreement.

 

   Finance Document means:

 

  (a) this Agreement;

 

  (b) a Fee Letter;

 

  (c) a Transfer Certificate; or

 

  (d) any other document designated as such by the Facility Agent and the
Company.

 

   Finance Party means a Lender or an Administrative Party.

 

   Financial Indebtedness means, without duplication, Indebtedness (whether
being principal, premium, interest or other amounts) for or in respect of:

 

  (a) money borrowed;

 

  (b) liabilities under or in respect of any acceptance or acceptance credit;

 

  (c) any notes, bonds, debentures, debenture stock, loan stock or other debt
securities offered, issued or distributed whether by way of public offer,
private placing, acquisition consideration or otherwise and whether issued for
cash or in whole or in part for a consideration other than cash;

 

  (d) any interest rate and/or currency swap, forward foreign exchange
transaction, financial or commodity futures transaction, commodity swap or other
derivative transaction;

 

  (e) liabilities pursuant to any lease which are capitalised in accordance with
USGAAP; or

 

  (f) liabilities under any guarantee, indemnity or other assurance against
financial loss given in relation to any of the above.

 

   Fixed Assets means, in relation to the Group, those assets treated as Fixed
Assets for the purposes of the Latest Accounts.

 

   Group means the Company and its Subsidiaries.

 

   Holding Company of any other person, means an entity in respect of which that
other person is a Subsidiary.

 

   Increased Cost means:

 

  (a) an additional or increased cost;

 

3

--------------------------------------------------------------------------------

  (b) a reduction in the rate of return under this Agreement or on a Finance
Party’s (or its Affiliate’s) overall capital; or

 

  (c) a reduction of an amount due and payable under any Finance Document,

 

   which is incurred or suffered by a Finance Party or its Affiliates but only
to the extent attributable to that Finance Party having entered into any Finance
Document or funding or performing its obligations under any Finance Document.

 

   Indebtedness means any obligation for the payment or repayment of money in
whatever currency denominated, whether as principal or as surety and whether
present or future, actual, deferred or contingent.

 

   Latest Accounts means the audited consolidated financial statements of the
Group last delivered to the Facility Agent under Clause 17.2 (Financial
information).

 

   Lender means:

 

  (a) an Original Lender; or

 

  (b) any person which becomes a Lender after the date of this Agreement.

 

   LIBOR means, for a Term of any Loan or overdue amount denominated in a
currency other than euro:

 

  (a) the applicable Screen Rate; or

 

  (b) if no Screen Rate is available for the relevant currency or Term of that
Loan or overdue amount, the arithmetic mean (rounded upward to four decimal
places) of the rates, as supplied to the Facility Agent at its request, quoted
by the Reference Banks to leading banks in the London interbank market, as of
11.00 a.m. on the Rate Fixing Day for the offering of deposits in the currency
of that Loan or overdue amount for a period comparable to its Term.

 

   Loan means, unless otherwise stated in this Agreement, the principal amount
of each borrowing under this Agreement or the principal amount outstanding of
that borrowing, in each case pursuant to Clauses 2.1 and 5 and the terms and
conditions relevant thereto under this Agreement.

 

   Majority Lenders means, at any time, Lenders:

 

  (a) whose share in the outstanding Loans and whose undrawn Commitments then
aggregate 66 2/3 per cent. or more of the aggregate of all the outstanding Loans
and the undrawn Commitments of all the Lenders; or

 

  (b) if there is no Loan then outstanding, whose undrawn Commitments then
aggregate 66 2/3 per cent. or more of the Total Commitments; or

 

  (c) if there is no Loan then outstanding and the Total Commitments have been
reduced to zero, whose Commitments aggregated 66 2/3 per cent. or more of the
Total Commitments immediately before the reduction.

 

   Mandatory Cost means the cost as reasonably determined by a Lender, imputed
to that Lender of compliance with:

 

  (a) any banking supervision or other costs imposed by the Bank of England or
the United Kingdom Financial Services Authority; and

 

4

--------------------------------------------------------------------------------

  (b) any other applicable regulatory or central bank requirements relating to
any Loan, including any reserve asset requirements of the European Central Bank
or the Central Bank.

 

   Margin means 0.20 per cent. per annum.

 

   Margin Regulations means Regulations U and X issued by the Board of Governors
of the United States Federal Reserve System.

 

   Margin Stock has the meaning given to it in the Margin Regulations.

 

   Material Subsidiary means any Subsidiary of the Company:

 

  (a) whose total assets (being the total of fixed assets and current assets)
(consolidated in the case of a Subsidiary which itself has one or more
Subsidiaries) represent not less than 7.5 per cent. of Total Assets; and/or

 

  (b) whose gross revenues (being gross revenues less internal revenues
(excluding exceptionals), before operating expenses and depreciation)
(consolidated in the case of a Subsidiary which itself has one or more
Subsidiaries) represent not less than 7.5 per cent. of the consolidated gross
revenues of the Group (being gross revenues (excluding exceptionals) before
operating expenses and depreciation on a consolidated basis as shown in the
Latest Accounts),

 

   as calculated, in the case of a Subsidiary, from the then latest audited
financial statements (consolidated or, as the case may be, unconsolidated) of
the Subsidiary or, in the case of the Group, the Latest Accounts.

 

   Maturity Date means, for a Loan, the last day of its Term.

 

   Participating Member State means a member state of the European Communities
that adopts or has adopted the euro as its lawful currency under the legislation
of the European Community for Economic Monetary Union.

 

   Party means a party to this Agreement.

 

   Permitted Disposal means any of the following:

 

  (a) disposals of Assets in the ordinary course of trading at arms’ length;

 

  (b) disposals on normal commercial terms of obsolete Assets or Assets no
longer used or useful in the Company’s business;

 

  (c) payment of cash as consideration for the acquisition of any Asset on
normal commercial terms;

 

  (d) temporary application of funds not immediately required in the Company’s
business for the purchase of investments or the realisation of such investments;

 

  (e) exchange of Assets for other assets of a similar nature and value, or the
sale of Assets on normal commercial terms for cash that is payable in full on
completion of the sale and is to be, and is, applied toward the purchase of
similar Assets within six months;

 

  (f) disposals of Assets located outside the Republic; and

 

  (g) any disposal which the Facility Agent agrees in writing is a Permitted
Disposal upon the approval of the Majority Lenders.

 

5

--------------------------------------------------------------------------------

     Permitted Merger means:

 

  (a) a merger of any Subsidiary (which has a positive consolidated net worth)
of the Company into the Company, such that the Company acquires all the assets
and liabilities of such Subsidiary and the Company is the surviving legal
entity, provided the Company’s post-merger consolidated net worth equals or
exceeds the immediately preceding pre-merger consolidated net worth of the
Company and that Subsidiary as determined on the basis of accounting principles
and practices consistent with the preparation of the Latest Accounts;

 

  (b) any other merger or corporate restructuring approved in advance in writing
by the Facility Agent (acting on the instructions of the Majority Lenders);

 

  (c) a merger of any Subsidiary of United States Steel Corporation into the
Company, such that the Company acquires all the assets and liabilities of such
Subsidiary and the Company is the surviving legal entity, provided the Company’s
post-merger consolidated net worth equals or exceeds the immediately preceding
pre-merger consolidated net worth of the Company and that Subsidiary as
determined on the basis of accounting principles and practices consistent with
the preparation of the Latest Accounts.

 

     Permitted Security Interest means any of the following:

 

  (a) Security Interests existing on the date of this Agreement and disclosed to
the Facility Agent in writing;

 

  (b) any Security Interests incurred in connection with the acquisition of any
asset, the assumption of any Security Interest previously existing on such
acquired asset or any Security Interest existing on any asset of any person when
it becomes a Subsidiary of the Company in each case provided that the
Indebtedness secured by such Security Interest does not exceed the fair market
value of that asset as at the date of that acquisition;

 

  (c) easements, rights-of-way, minor defects or irregularities in title and
other similar encumbrances on real property having no material adverse effect on
the then current use or value of such real property, or on the then current
conduct of the business of any member of the Group;

 

  (d) unexercised liens for taxes not being delinquent or contested in good
faith by appropriate proceedings and for which reserves, adequate under USGAAP,
are being maintained;

 

  (e) any Security Interest on equipment of the Company arising solely under
leases of such equipment that, in accordance with USGAAP, are required to be
capitalised, provided that any such Security Interest extends to no other
property and secures no other Indebtedness and the Indebtedness secured by any
such Security Interest does not exceed the fair market value of such equipment;

 

  (f) purchase money Security Interests on equipment acquired by the Company
after the Completion Date incurred simultaneously with or within 45 days after
the completion of installation thereof solely to secure payment of all or part
of the purchase price thereof provided that each such Security Interest secures
no other Indebtedness and extends to no other property and the Indebtedness
secured by any such Security Interest does not exceed the fair market value of
such equipment;

 

  (g) liens arising solely by operation of law (or by an agreement evidencing
the same) in the ordinary course of Company’s business in respect of
Indebtedness that either: (i) has been due for less than 90 days or (ii) is
being contested in good faith by appropriate means and for which reserves,
adequate under USGAAP, are being maintained;

 

6

--------------------------------------------------------------------------------

  (h) Security Interests arising out of title retention provisions in a
supplier’s standard conditions of supply of goods acquired by Company in the
ordinary course of its business;

 

  (i) any Security Interest approved by the Facility Agent with the approval of
the Majority Lenders; and

 

  (j) any renewal of or substitution for any Security Interest permitted under
any preceding paragraph.

 

     Pro Rata Share means on a particular date:

 

  (a) the proportion which a Lender’s share of the Loans (if any) bears to all
the Loans;

 

  (b) if there is no Loan outstanding on that date, the proportion which its
Commitment bears to the Total Commitments on that date; or

 

  (c) if the Total Commitments have been cancelled, the proportion which its
Commitment bore to the Total Commitments immediately before being cancelled.

 

     Rate Fixing Day means:

 

  (a) the second Business Day before the first day of a Term for a Loan
denominated in any other currency (other than euro); or

 

  (b) the second TARGET Day before the first day of a Term for a Loan
denominated in euro,

 

     or such other day as the Facility Agent, in consultation with the Company,
determines is generally treated as the rate fixing day by market practice in the
relevant interbank market.

 

     Reference Banks means the Facility Agent, and any other bank or financial
institution appointed as such by the Facility Agent under this Agreement.

 

     Relevant Taxes means Taxes imposed or levied by the Republic (or any
political subdivision or taxing authority of the Republic) or by any other
jurisdiction from or through which any payment is made by the Company under the
Finance Document, but excludes Taxes imposed by the Republic which are so
imposed as a direct consequence of the relevant Finance Party maintaining a
permanent establishment in the Republic and of that establishment being directly
involved in any Loan.

 

     Repeating Representations and Warranties means the representations and
warranties that are deemed to be repeated under this Agreement.

 

     Republic means the Slovak Republic.

 

     Request means a request made by the Company for a Loan, substantially in
the form of Schedule 2 (Form of Request).

 

     Rollover Loan means one or more Loans:

 

  (a) to be made on the same day that a maturing Loan is due to be repaid;

 

  (b) the aggregate amount of which is equal to or less than the maturing Loan;
and

 

  (c) in the same currency as the maturing Loan.

 

7

--------------------------------------------------------------------------------

     Screen Rate means:

 

  (a) for LIBOR, the British Bankers Association Interest Settlement Rate; and

 

  (b) for EURIBOR, the percentage rate per annum determined by the Banking
Federation of the European Union,

 

     for the relevant currency and Term displayed on the appropriate page of the
Telerate screen. If the relevant page is replaced or the service ceases to be
available, the Facility Agent (after consultation with the Company and the
Majority Lenders) may specify another page or service displaying the appropriate
rate.

 

     Security Interest means any mortgage, pledge, lien, charge (including a
floating charge), assignment (whether conditional or otherwise), hypothecation
or security interest or any other agreement or arrangement having the effect of
conferring security, or any other arrangement having a similar economic effect
including (without limitation) total transfer, ‘flawed asset’, sale and
repurchase, buyback or conditional transfer arrangements.

 

     Slovak Accounting Standards means the generally accepted accounting
principles and practices in the Republic, in effect from time to time.

 

     Subsidiary means an entity of which a person has direct or indirect control
or owns directly or indirectly more than 50 per cent. of the voting capital or
similar right of ownership and control for this purpose means the power to
direct the management and the policies of the entity whether through the
ownership of share capital, contract or otherwise.

 

     TARGET Day means a day on which the Trans-European Automated Real-time
Gross Settlement Express Transfer payment system is open for the settlement of
payments in euro.

 

     Tax means any tax, levy, impost, duty or other charge or withholding of a
similar nature (including any penalty or interest related thereto).

 

     Term means each period determined under this Agreement by reference to
which interest on a Loan or an overdue amount is calculated.

 

     Total Assets means the amount that is the aggregate of the Total Fixed
Assets (less intangibles, other than externally produced and purchased software)
and the amount shown as the total of the current assets of the Group in the
Latest Accounts.

 

     Total Fixed Assets means the amount shown as the total of the Fixed Assets
of the Group in the Latest Accounts.

 

     Total Commitments means the aggregate of the Commitments of all the
Lenders.

 

     Transfer Certificate means a certificate in the form of Schedule 3 (Form of
Transfer Certificate) with such amendments as the Facility Agent may approve or
reasonably require or any other form agreed between the Facility Agent and the
Company in writing.

 

     USGAAP means the generally accepted accounting principles and practices in
the United States of America in effect from time to time.

 

     Utilisation Date means each date on which the Facility is utilised.

 

8

--------------------------------------------------------------------------------

1.2 Construction

 

(a) In this Agreement, unless the contrary intention appears, a reference to:

 

  (i) an amendment includes a supplement, novation, restatement or re-enactment
and amended is to be construed accordingly;

 

       an authorisation includes an authorisation, consent, approval,
resolution, licence, exemption, filing, registration or notarisation;

 

       disposal means a sale, transfer, grant, lease or other disposal, whether
voluntary or involuntary, and dispose will be construed accordingly;

 

       indebtedness includes any obligation (whether incurred as principal or as
surety) for the payment or repayment of money;

 

       know your customer requirements are the identification checks that a
Finance Party requests in order to meet its obligations under any applicable law
or regulation to identify a person who is (or is to become) its customer;

 

       a person includes any individual, company, corporation, unincorporated
association or body (including a partnership, trust, joint venture or
consortium), government, state, agency, organisation or other entity whether or
not having separate legal personality;

 

       a regulation includes any regulation, rule, official directive, request
or guideline (whether or not having the force of law but, if not having the
force of law, being of a type with which any person to which it applies is
accustomed to comply) of any governmental, inter-governmental or supranational
body, agency, department or regulatory, self-regulatory or other authority or
organisation;

 

  (ii) a currency is a reference to the lawful currency for the time being of
the relevant country;

 

  (iii) a Default being outstanding means that it has not been remedied or
waived;

 

  (iv) a provision of law is a reference to that provision as extended, applied,
amended or re-enacted and includes any subordinate legislation;

 

  (v) a Clause, a Subclause or a Schedule is a reference to a clause or
subclause of, or a schedule to, this Agreement;

 

  (vi) a Party or any other person includes its successors in title, permitted
assigns and permitted transferees;

 

  (vii) a Finance Document or another document is a reference to that Finance
Document or other document as amended; and

 

  (viii) a time of day is a reference to London Time.

 

(b) Unless the contrary intention appears, a reference to a month or months is a
reference to a period starting on one day in a calendar month and ending on the
numerically corresponding day in the next calendar month or the calendar month
in which it is to end, except that:

 

  (i) if the numerically corresponding day is not a Business Day, the period
will end on the next Business Day in that month (if there is one) or the
preceding Business Day (if there is not);

 

9

--------------------------------------------------------------------------------

  (ii) if there is no numerically corresponding day in that month, that period
will end on the last Business Day in that month; and

 

  (iii) notwithstanding sub-paragraph (i) above, a period that commences on the
last Business Day of a month will end on the last Business Day in that calendar
month.

 

(c)

 

(i)

 

Unless expressly provided to the contrary in a Finance Document, a person who is
not a party to a Finance Document may not enforce any of its terms under the
Contracts (Rights of Third Parties) Act 1999.

 

  (ii) Notwithstanding any term of any Finance Document, the consent of any
third party is not required for any variation (including any release or
compromise of any liability under) or termination of that Finance Document.

 

(d) A reference to a Party will not include that Party if it has ceased to be a
Party under this Agreement.

 

(e) Unless the contrary intention appears:

 

  (i) a term used in any other Finance Document or in any notice given in
connection with any Finance Document has the same meaning in that Finance
Document or notice as in this Agreement;

 

  (ii) if there is an inconsistency between this Agreement and any other Finance
Document, this Agreement will prevail;

 

  (iii) any non-payment obligations of the Company under the Finance Documents
remain in force for so long as any payment obligation is or may be outstanding
under the Finance Documents; and

 

  (iv) the headings in this Agreement do not affect its interpretation.

 

2. FACILITY

 

2.1 Revolving facility

 

     Subject to the terms of this Agreement, the Lenders make available to the
Company a revolving credit facility in an aggregate amount equal to the Total
Commitments.

 

2.2 Nature of a Finance Party’s rights and obligations

 

     Unless otherwise agreed in writing by all the Finance Parties:

 

  (a) the obligations of a Finance Party under the Finance Documents are
several. Failure of a Finance Party to perform its obligations does not affect
the obligations of any other Party under the Finance Documents. No Finance Party
is responsible for the obligations of any other Finance Party under the Finance
Documents; and

 

  (b) the rights of a Finance Party under the Finance Documents are separate and
independent rights, and a debt arising under the Finance Documents to a Finance
Party is a separate and independent debt. A Finance Party may, except as
otherwise stated in the Finance Documents and without prejudice to Clause 24,
separately enforce those rights.

 

10

--------------------------------------------------------------------------------

3. PURPOSE

 

3.1 Loans

 

     Each Loan must be used by the Company for general business purposes.

 

3.2 No obligation to monitor

 

     No Finance Party is bound to monitor or verify the utilisation of the
Facility.

 

4. CONDITIONS PRECEDENT

 

4.1 Conditions precedent documents

 

     A Request may not be given by the Company until the Facility Agent has
notified the Company and the Lenders that it has received all of the documents
and evidence set out in Schedule 4 (Conditions precedent documents) in form and
substance satisfactory to the Facility Agent. The Facility Agent must give this
notification as soon as reasonably practicable.

 

4.2 Further conditions precedent

 

     The obligations of each Lender to advance its participation in any Loan are
subject to the further conditions precedent that on both the date of the Request
and the Utilisation Date for that Loan:

 

  (a) the Repeating Representations and Warranties are correct in all material
respects; and

 

  (b) no Default or, in the case of a Rollover Loan, no Event of Default, is
outstanding or would result from the advance of the Loan.

 

4.3 Drawstop

 

     A Request may not be made in any case where the Company is in default under
the Existing Facility of any payment obligation (or payment obligations in
aggregate) in an amount equal to or in excess of USD100,000 or its equivalent in
other currencies (a Drawstop Event). Following a Drawstop Event, no further
Requests may be made until the Facility Agent notifies the Company in writing
that it may submit a Request. The Facility Agent shall so notify the Company
promptly after the Facility Agent receives evidence reasonably satisfactory to
it that such default or defaults: (i) are no longer continuing; or (ii) are
waived in accordance with the ING Facility Agreement; or (iii) a combination of
(i) and (ii), whereby, following such waivers (if any), such default or defaults
(if any) are in aggregate in an amount less than USD100,000 or its equivalent in
other currencies.

 

4.4 Maximum number

 

     Unless the Facility Agent agrees, a Request may not be given if, as a
result, there would be more than five Loans outstanding.

 

5. UTILISATION - LOANS

 

5.1 Giving of Requests

 

(a) The Company may borrow a Loan by giving to the Facility Agent a duly
completed Request.

 

(b) Unless the Facility Agent otherwise agrees, the latest time for receipt by
the Facility Agent of the first duly completed Request is 10.00 a.m. two
Business Days before the Rate Fixing Day for the proposed borrowing, and for
subsequent proposed borrowings the latest time for receipt by the Facility Agent
of the duly completed Request is 10.00 a.m. three Business Days before the Rate
Fixing Day for the proposed borrowing.

 

11

--------------------------------------------------------------------------------

(c) Each Request is irrevocable unless otherwise agreed by the Facility Agent
upon the approval of the Majority Lenders.

 

5.2 Completion of Requests

 

     A Request will not be regarded as having been duly completed unless:

 

  (a) the Utilisation Date is a Business Day falling within the Availability
Period; and

 

  (b) the proposed currency, amount and Term comply with this Agreement.

 

  Only one Loan may be requested in a Request.

 

5.3 Amount of Loan

 

(a) Except as provided below, the amount of the Loan must be a minimum of
€10,000,000 and in integral multiples of €1,000,000 or its equivalent.

 

(b) The amount of the Loan may also be the balance of the undrawn Total
Commitments or such other amount as the Facility Agent or the Lenders may agree.

 

(c) The amount of each Lender’s share of the Loan will be its Pro Rata Share on
the proposed Utilisation Date.

 

5.4 Advance of Loan

 

(a) The Facility Agent must promptly notify each Lender of the details of the
requested Loan and the amount of its share in that Loan.

 

(b) No Lender is obliged to participate in a Loan if, as a result

 

  (i) its share in the Loans would exceed its Commitment; or

 

  (ii) the Loans would exceed the Total Commitments.

 

(c) If the conditions set out in this Agreement have been met, each Lender must
make its share in the Loan available to the Facility Agent for the Company on
the Utilisation Date and the Facility Agent shall make the funds received from
the Lenders available to the Company on the Utilisation Date.

 

6. OPTIONAL CURRENCIES

 

6.1 General

 

     In this Clause:

 

     Facility Agent’s Spot Rate of Exchange means the Facility Agent’s spot rate
of exchange for the purchase of Optional Currency in the London foreign exchange
market with euros at or about 11.00 a.m. on a particular day.

 

     Original Euro Amount of a Loan or part of a Loan means:

 

  (a) if the Loan is denominated in euros, its amount; or

 

12

--------------------------------------------------------------------------------

  (b) unless adjusted below, if the Loan is denominated in an Optional Currency
for a Term, its equivalent in euros calculated on the basis of the Facility
Agent’s Spot Rate of Exchange one Business Day before the Rate Fixing Day for
that Term.

 

     Optional Currency means any currency (other than euros) in which a Loan may
be denominated under this Agreement.

 

6.2 Selection

 

(a) The Company must select the currency of a Loan in its Request.

 

(b) The amount of a Loan requested in an Optional Currency must be a minimum
amount of the equivalent of €10,000,000 and in integral multiples of €1,000,000
or its equivalent in an Optional Currency.

 

(c) Unless the Facility Agent otherwise agrees, the Loans may not be denominated
at any one time in more than 2 currencies.

 

6.3 Conditions relating to Optional Currencies

 

(a) A Loan may be denominated in an Optional Currency for a Term if:

 

  (i) that Optional Currency is readily available in the amount required and
freely convertible into euros in the relevant interbank market on the Rate
Fixing Day and the first day of that Term; or

 

  (ii) that Optional Currency is United States Dollars.

 

(b) If the Facility Agent has received a request from the Company for a currency
to be approved as an Optional Currency, the Facility Agent must, within five
Business Days, confirm to the Company:

 

  (i) whether or not the Lenders have given their approval; and

 

  (ii) if approval has been given, the minimum amount (and, if required,
integral multiples) for any Loan in that currency.

 

6.4 Revocation of currency

 

(a) Notwithstanding any other term of this Agreement, if before 9.30 a.m. on any
Rate Fixing Day the Facility Agent receives notice from a Lender that:

 

  (i) the Optional Currency requested is not readily available to it in the
relevant interbank market in the amount and for the period required; or

 

  (ii) participating in a Loan in the proposed Optional Currency might
contravene any law or regulation applicable to it,

 

     the Facility Agent must give notice to the Company to that effect promptly
and in any event before 11.00 a.m. on that day.

 

(b) In this event:

 

  (i) that Lender must participate in the Loan in euros; and

 

13

--------------------------------------------------------------------------------

  (ii) the share of that Lender in the Loan and any other similarly affected
Lender(s) will be treated as a separate Loan denominated in euros during that
Term.

 

(c) Any part of a Loan treated as a separate Loan under this Subclause will not
be taken into account for the purposes of any limit on the number of Loans or
currencies outstanding at any one time.

 

(d) A Loan will still be treated as a Rollover Loan if it is not denominated in
the same currency as the maturing Loan by reason only of the operation of this
Subclause.

 

6.5 Optional Currency equivalents

 

     The equivalent in euros of a Loan or part of a Loan in an Optional Currency
for the purposes of calculating:

 

  (a) whether any limit under this Agreement has been exceeded;

 

  (b) the amount of a Loan;

 

  (c) the share of a Lender in a Loan;

 

  (d) the amount of any repayment or prepayment of a Loan; or

 

  (e) the undrawn amount of a Lender’s Commitment,

 

     is its euro Amount.

 

6.6 Notification

 

     The Facility Agent must notify the Lenders and the Company of the relevant
euro Amount (and the applicable Agent’s Spot Rate of Exchange) promptly after
they are ascertained.

 

7. REPAYMENT

 

(a) The Company must repay each Loan made to it in full on its Maturity Date.

 

(b) Subject to the other terms of this Agreement, any amounts repaid under
paragraph (a) above may be re-borrowed.

 

8. PREPAYMENT AND CANCELLATION

 

8.1 Mandatory prepayment - illegality

 

     If at any time:

 

  (a) it is necessary under the laws and constitution of the Republic:

 

  (i) in order to enable any Lender to enforce its rights under the Finance
Documents; or

 

  (ii) by reason only of the execution, delivery and performance of this
Agreement by any Lender,

 

       that any Lender should be licensed, qualified or otherwise entitled to
carry on business in the Republic;

 

14

--------------------------------------------------------------------------------

  (b) a Lender is or will be deemed to be resident, domiciled or carrying on
business in or subject to the laws of the Republic by reason only of the
execution, delivery, performance and/or enforcement of any Finance Document;

 

  (c) in any proceedings taken in the Republic in respect of any Finance
Document or for the enforcement of any Finance Document, the choice of English
law as the governing law of the Finance Document will not be recognised; or

 

  (d) it is or becomes unlawful in any applicable jurisdiction for a Lender to
give effect to any of its obligations as contemplated by this Agreement or to
fund or maintain its participation in any Loan,

 

     and the occurrence of any of the foregoing causes a Lender (acting
reasonably) to believe it is materially prejudiced thereby then:

 

  (i) the relevant Lender may notify the Company (through the Facility Agent)
accordingly; and

 

  (ii) the Company shall forthwith prepay that Lender’s participation in all the
Loans, together with all other amounts payable by it to that Lender under the
Finance Documents and the Commitment of that Lender shall forthwith be reduced
to zero,

 

     except that paragraphs (a) and (b) above do not apply to any Lender acting
through its Facility Office or having a permanently established office or branch
in the Republic.

 

8.2 Mandatory prepayment - change of control

 

(a) The Company shall, within ten days after the occurrence of a Change of
Control notify such to the Facility Agent, and the Facility Agent shall promptly
notify each Lender thereof. Such notice shall describe in reasonable detail the
facts and circumstances giving rise thereto and the date of such Change of
Control and each Lender may, by notice to the Company and the Facility Agent
given not later than fifty days after the date of such Change of Control,
declare any amounts payable by the Company under the Finance Documents for its
account to be, and such amounts shall become, due and payable, in each case on
the sixtieth day after the date of such Change of Control (or if such day is not
a Business Day, the succeeding day that is), without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by the
Company.

 

(b) For purposes of paragraph (a) above, the following terms have the following
meanings:

 

     A Change of Control shall occur if:

 

  (i) any person or group of persons shall have acquired beneficial ownership
(within the meaning of Section 13(d) or 14(d) of the U.S. Securities Exchange
Act of 1934, as amended, and the applicable rules and regulations thereunder),
or shares of Voting Stock representing 35 per cent. or more of the Voting Power
of United States Steel Corporation;

 

  (ii) during any period of twenty-five consecutive months, commencing before or
after the date of this Agreement, individuals who at the beginning of such
twenty-five month period were directors of United States Steel Corporation
(together with any replacement or additional directors whose election was
recommended by the incumbent directors of United States Steel Corporation or who
were elected by a majority of directors then in office) cease to constitute a
majority of the board of directors of United States Steel Corporation; or

 

  (iii) any person or group of related persons shall acquire all or
substantially all of the assets of United States Steel Corporation, unless
United States Steel Corporation shall have merged or

 

15

--------------------------------------------------------------------------------

       consolidated with or transferred all or substantially all of its assets
to another corporation and the surviving or successor or transferee corporation
is no more leveraged than was United States Steel Corporation) immediately prior
to such event. For the purposes of this definition, the term leveraged when used
with respect to any corporation shall mean the percentage represented by the
total assets of that corporation divided by its stockholders’ equity, in each
case determined and as would be shown in a consolidated balance sheet of such
corporation prepared in accordance with USGAAP.

 

     Voting Power as applied to the stock of any corporation means the total
voting power represented by all outstanding Voting Stock of such corporation.

 

     Voting Stock as applied to the stock of any corporation means stock of any
class or classes (however designated) having ordinary voting power for the
election of the directors of such corporation, other than stock having such
power only by reason of the happening of a contingency.

 

8.3 Voluntary prepayment

 

(a) The Company may, by giving not less than five Business Days’ prior notice to
the Facility Agent, prepay any Loan at any time in whole or in part.

 

(b) A prepayment of part of a Loan must be in a minimum amount of €10,000,000 or
its equivalent in an Optional Currency and an integral multiple of €1,000,000 or
its equivalent in an Optional Currency and is subject to Break Costs.

 

8.4 Automatic cancellation

 

     The Commitment of each Lender will be automatically cancelled at the close
of business on the last day of the Availability Period.

 

8.5 Voluntary cancellation

 

(a) The Company may, by giving not less than five Business Days’ prior notice to
the Facility Agent, cancel the unutilised amount of the Total Commitments in
whole or in part.

 

(b) Partial cancellation of the Total Commitments must be in a minimum amount of
€10,000,000 or its equivalent in an Optional Currency and an integral multiple
of €1,000,000 or its equivalent in an Optional Currency.

 

(c) Any cancellation in part will be applied against the Commitment of each
Lender pro rata.

 

8.6 Prepayment and cancellation

 

(a) If the Company is, or will be, required to pay to a Lender a Tax Payment or
an Increased Cost, the Company may, while the requirement continues, give notice
to the Facility Agent requesting prepayment and cancellation in respect of that
Lender.

 

(b) After notification under paragraph (a) above:

 

  (i) the Company must repay or prepay that Lender’s share in each Loan on the
date specified in paragraph (c) below; and

 

  (ii) the Commitment of that Lender will be immediately cancelled.

 

(c) The date for repayment or prepayment of a Lender’s share in a Loan will be
the last day of the Term for that Loan or, if earlier, the date specified by the
Company in its notification.

 

16

--------------------------------------------------------------------------------

8.7 Re-borrowing of Loans

 

     Any voluntary prepayment of a Loan may be re-borrowed on the terms of this
Agreement. Any mandatory or involuntary prepayment of a Loan may not be
re-borrowed.

 

8.8 Miscellaneous provisions

 

(a) Any notice of prepayment and/or cancellation under this Agreement is
irrevocable and must specify the relevant date(s) and the affected Loans and
Commitments. The Facility Agent must notify the Lenders promptly of receipt of
any such notice.

 

(b) All prepayments under this Agreement must be made with accrued interest on
the amount prepaid. No premium or penalty is payable in respect of any
prepayment except for Break Costs.

 

(c) The Majority Lenders may agree a shorter notice period for a voluntary
prepayment or a voluntary cancellation.

 

(d) No prepayment or cancellation is allowed except in accordance with the
express terms of this Agreement.

 

(e) No amount of the Total Commitments cancelled under this Agreement may
subsequently be reinstated.

 

9. INTEREST

 

9.1 Calculation of interest

 

     The rate of interest on each Loan for each Term is the percentage rate per
annum equal to the aggregate of the applicable:

 

  (a) Margin;

 

  (b) EURIBOR or, in the case of a Loan in an Optional Currency, LIBOR; and

 

  (c) Mandatory Cost.

 

9.2 Payment of interest

 

     Except where it is provided to the contrary in this Agreement, the Company
must pay accrued interest on each Loan made to it on the last day of each
applicable Term and also, if the Term is longer than six months, on the dates
falling at six-month intervals after the first day of that Term.

 

9.3 Interest on overdue amounts

 

(a) If the Company fails to pay any amount payable by it under the Finance
Documents, it must immediately on demand by the Facility Agent pay interest on
the overdue amount from its due date up to the date of actual payment, both
before, and after judgement.

 

(b) Interest on an overdue amount is payable at a rate determined by the
Facility Agent to be 1 per cent. per annum above the rate which would have been
payable if the overdue amount had, during the period of non-payment, constituted
a Loan in the currency of the overdue amount. For this purpose, the Facility
Agent may (acting reasonably):

 

  (i) select successive Terms of any duration of up to three months (an Interest
Period); and

 

17

--------------------------------------------------------------------------------

  (ii) determine the appropriate Rate Fixing Day for that Term.

 

(c) Notwithstanding paragraph (b) above, if the overdue amount is a principal
amount of a Loan and becomes due and payable prior to the last day of its
current Term, then:

 

  (i) the first Term for that overdue amount will be the unexpired portion of
that Term; and

 

  (ii) the rate of interest on the overdue amount for that first Term will be 1
per cent. per annum above the rate then payable on that Loan.

 

     After the expiry of the first Term for that overdue amount, the rate on the
overdue amount will be calculated in accordance with paragraph (b) above.

 

(d) Interest (if unpaid) on an overdue amount will be compounded with that
overdue amount at the end of each of its Terms but will remain immediately due
and payable.

 

9.4 Notification of rates of interest

 

     The Facility Agent must promptly notify each relevant Party of the
determination of a rate of interest under this Agreement.

 

10. TERMS

 

10.1 Selection

 

(a) Each Loan has one Term only.

 

(b) The Company must select the Term for a Loan in the relevant Request.

 

(c) Subject to the following provisions of this Clause, each Term for a Loan
will be one, two, three or six months or any other period agreed in writing by
the Lenders acting unanimously.

 

10.2 No overrunning the Final Maturity Date

 

     If a Term would otherwise overrun the Final Maturity Date, it will be
shortened so that it ends on the Final Maturity Date in which case the Company
will have no obligation to pay Break costs or other costs arising from the
shortening.

 

10.3 Notification

 

     The Facility Agent must notify the Company and the Lenders of the duration
of each Term promptly after ascertaining its duration.

 

11. MARKET DISRUPTION

 

11.1 Failure of a Reference Bank to supply a rate

 

     If LIBOR or EURIBOR is to be calculated by reference to the Reference Banks
but a Reference Bank does not supply a rate by noon on a Rate Fixing Day, the
applicable LIBOR or EURIBOR will, subject as provided below, be calculated on
the basis of the rates of the remaining Reference Banks.

 

11.2 Market disruption

 

(a) In this Clause, each of the following events is a market disruption event:

 

  (i) LIBOR EURIBOR is to be calculated by reference to the Reference Banks but
no, or only one, Reference Bank supplies a rate by noon on the Rate Fixing Day;
or

 

18

--------------------------------------------------------------------------------

  (ii) the Facility Agent receives by close of business on the Rate Fixing Day
notification from Lenders whose shares in the relevant Loan exceed 30 per cent.
of that Loan that the cost to them of obtaining matching deposits in the
relevant interbank market is in excess of LIBOR or EURIBOR for the relevant
Term.

 

(b) The Facility Agent must promptly notify the Company and the Lenders of a
market disruption event.

 

(c) After notification under paragraph (b) above, the rate of interest on each
Lender’s share in the affected Loan for the relevant Term will be the aggregate
of the applicable:

 

  (i) Margin;

 

  (ii) rate notified to the Facility Agent by that Lender as soon as practicable
to be that which expresses as a percentage rate per annum the cost to that
Lender of funding its share in that Loan from whatever source it may reasonably
select; and

 

  (iii) Mandatory Cost.

 

11.3 Alternative basis of interest or funding

 

(a) If a market disruption event occurs and the Facility Agent or the Company so
requires, the Company and the Facility Agent must enter into negotiations for a
period of not more than 30 days with a view to agreeing an alternative basis for
determining the rate of interest and/or funding for the affected Loan and any
future Loan.

 

(b) Any alternative basis agreed will be, with the prior consent of all the
Lenders, binding on the Company and the Lenders.

 

12. TAXES

 

12.1 Gross-up

 

     All payments by the Company under the Finance Documents shall be made
without any deduction and free and clear of and without deduction for or on
account of any Taxes, except to the extent that the Company is required by law
to make payment subject to any Taxes. If any Relevant Tax or amounts in respect
of any Relevant Tax must be deducted from any amounts payable or paid by the
Company, or paid or payable by the Facility Agent to a Lender, under the Finance
Documents, the Company shall, subject to Clause 12.4 (Exception to the
gross-up), pay such additional amounts as may be necessary to ensure that the
relevant Lender receives a net amount equal to the full amount which it would
have received had payment not been made subject to Relevant Tax.

 

12.2 Tax receipts

 

     All Taxes required by law to be deducted or withheld by the Company from
any amounts paid or payable under the Finance Documents shall be paid by the
Company when due and the Company shall, within 15 days of receipt of evidence of
the payment being made, deliver the same to the Facility Agent.

 

19

--------------------------------------------------------------------------------

12.3 Reimbursement of tax credit

 

(a) If:

 

  (i) the Company pays any additional amount (a Tax Payment) under Clause 12.1
(Gross-up) for the account of a Lender; and

 

  (ii) the Lender effectively obtains, or could have effectively obtained by
taking reasonable action (in which case the Lender shall be treated as actually
having obtained), a refund of Tax, or credit against Tax, by reason of that Tax
Payment (a Tax Credit),

 

     then the Lender shall reimburse to the Company such amount as the Lender
shall reasonably determine to be the proportion of the Tax Credit as will leave
the Lender (after that reimbursement) in no better or worse position than it
would have been in if the Tax Payment had not been required. Notwithstanding
sub-clause (ii) above, a Lender may choose not to make or to limit the amount or
alter the timing of any Tax Credit if to do otherwise would result in a material
adverse effect to the Lender or on its relationship with the relevant Tax
authority. Upon reasonable request from the Company, the Lender shall provide
the Company with a certification concerning whether or not a Tax Credit was
obtained or was attempted to be obtained by the Lender as well as reasonable
detail concerning the amount of the Tax Credit. No Finance Party is obliged to
disclose any information regarding its Tax affairs or computations to any other
person.

 

12.4 Exception to the gross-up

 

     The Company is not required to pay an additional amount for the account of
a Lender under Clause 12.1 (Gross-up):

 

  (i) to the extent that the obligation to pay the additional amount would not
have arisen but for the failure by that Lender to provide (within a reasonable
period after being requested to do so by the Company or the Facility Agent and
at the cost of the Company) any form, certificate or other documentation:

 

  (A) the provision of which would have relieved (in whole or in part) the
Company from the relevant withholding obligation; and

 

  (B) which it is fully within the power of the Lender to provide;

 

  (ii) if that Lender has not complied with its obligations under Clause 12.5(a)
(Tax confirmation) for a period of 90 days from the date that Lender became
aware that it could not give the confirmation referred to in Clause 12.5(a) (Tax
confirmation); or

 

  (iii) the confirmation provided by that Lender under Clause 12.5(a) (Tax
confirmation) is incorrect when made.

 

12.5 Tax confirmation

 

(a) Each Lender (other than a Lender with its Facility Office situated in the
Republic) confirms to the Company that on the date of this Agreement (or if it
only subsequently becomes a Party to this Agreement, on that date) under the
terms of a double taxation treaty between the jurisdiction in which that Lender
is resident and the Republic payments due to it under the Finance Documents may
be made without deduction or withholding on account of any Tax imposed or levied
by the Republic (or any political subdivision or taxing authority of the
Republic) under the laws of the Republic, as interpreted and applied at that
time.

 

20

--------------------------------------------------------------------------------

(b) If a Lender becomes aware that it could not, on any particular day, give the
confirmation referred to in paragraph (a) above, it shall promptly but in any
event within 90 days, notify such to the Company (through the Facility Agent).

 

12.6 Stamp taxes

 

     The Company must pay and indemnify each Finance Party against any stamp
duty, registration or other similar Tax payable in connection with the entry
into, performance or enforcement of any Finance Document, except for any such
Tax payable in connection with the entry into of a Transfer Certificate.

 

12.7 Value added taxes

 

(a) Any amount (including costs, fees and expenses) payable under a Finance
Document by the Company is exclusive of any value added tax or similar tax that
might be chargeable in connection with that amount. If any such value added tax
or similar tax is chargeable, the Company must pay (in addition to and at the
same time as it pays that amount) an amount equal to the amount of that value
added tax or similar tax.

 

(b) The obligation of the Company under paragraph (a) above will be reduced to
the extent that the Finance Party is entitled to repayment or a credit in
respect of the relevant value added tax or similar tax.

 

13. INCREASED COSTS

 

13.1 Increased Costs

 

     Except as provided below in this Clause, the Company must pay to a Finance
Party the amount of any Increased Cost incurred by that Finance Party or its
Affiliates as a result of:

 

  (a) the introduction of, or any change in, or any change in the interpretation
or application of, any law or regulation; or

 

  (b) compliance with any law or regulation made after the date of this
Agreement.

 

     Each Finance Party agrees to notify the Company promptly upon becoming
aware that this Clause 13.1 applies.

 

13.2 Exceptions

 

     The Company need not make any payment for an Increased Cost to the extent
that the Increased Cost is:

 

  (a) compensated for under another Clause, or would have been but for an
exception to that Clause;

 

  (b) a tax on the overall net income of a Finance Party or its Affiliate;

 

  (c) attributable to a Finance Party or its Holding Company wilfully failing to
comply with any law or regulation;

 

  (d) on failure of the relevant Finance Party to notify the Company of that
increased cost within 45 days of becoming aware of it.

 

21

--------------------------------------------------------------------------------

13.3 Claims

 

     A Finance Party intending to make a claim for an Increased Cost must notify
the Facility Agent promptly of the circumstances giving rise to, and the amount
of, the claim, following which the Facility Agent will promptly notify the
Company of the circumstances giving rise to, and the amount of, the claim.

 

14. MITIGATION

 

     If circumstances arise which would, or would on the giving of notice,
result in:

 

  (a) any additional amounts becoming payable under Clause 12 (Taxes); or

 

  (b) any amount becoming payable under Clause 13 (Increased costs); or

 

  (c) any prepayment or cancellation under Clause 8 (Prepayment and
Cancellation),

 

     then, without limiting the obligations of the Company under this Agreement
and without prejudice to the terms of Clauses 12 (Taxes), 13 (Increased costs)
and 8 (Prepayment and Cancellation), the relevant Lender shall, in consultation
with the Company, take such reasonable steps as may be open to it to mitigate or
remove the relevant circumstance, including (without limitation) changing its
Facility Office to one in another jurisdiction or the transfer of its rights and
obligations under this Agreement to another person, unless to do so might (in
the reasonable opinion of the Lender) be materially prejudicial to it.

 

15. PAYMENTS

 

15.1 Place

 

     Unless a Finance Document specifies that payments under it are to be made
in another manner, all payments by a Party (other than the Facility Agent) under
the Finance Documents must be made to the Facility Agent to its account at such
office or bank:

 

  (a) in the principal financial centre of the country of the relevant currency;
or

 

  (b) in the case of euro, in the principal financial centre of a Participating
Member State or London,

 

     as it may notify to that Party for this purpose by not less than 10
Business Days’ prior notice.

 

15.2 Funds

 

     Payments under the Finance Documents to the Facility Agent must be made for
value on the due date at such times and in such funds as the Facility Agent may
acting reasonably specify to the Party concerned as being customary at the time
for the settlement of transactions in the relevant currency in the place for
payment.

 

15.3 Currency

 

(a) Unless a Finance Document specifies that payments under it are to be made in
a different manner, the currency of each amount payable under the Finance
Documents is determined under this Clause.

 

(b) Interest is payable in the currency in which the relevant amount in respect
of which it is payable is denominated.

 

22

--------------------------------------------------------------------------------

(c) A repayment or prepayment of any principal amount is payable in the currency
in which that principal amount is denominated on its due date.

 

(d) Amounts payable in respect of costs and expenses are payable in the currency
in which they are incurred.

 

(e) Each other amount payable under the Finance Documents is payable in euro.

 

15.4 Distribution

 

(a) Each payment received by the Facility Agent under the Finance Documents for
another Party must, except as provided below, be made available by the Facility
Agent to that Party by payment on the date and in the currency and funds of
receipt to its account with such office or bank:

 

  (i) in the principal financial centre of the country of the relevant currency;
or

 

  (ii) in the case of euro, in the principal financial centre of a Participating
Member State or London,

 

     as it may notify to the Facility Agent for this purpose by not less than 4
Business Days’ prior notice.

 

(b) The Facility Agent may apply any amount received by it for the Company in or
towards payment (as soon as practicable after receipt) of any amount due from
the Company under the Finance Documents or in or towards the purchase of any
amount of any currency to be so applied.

 

(c) Where a sum is paid to the Facility Agent under this Agreement for another
Party, the Facility Agent is not obliged to pay that sum to that Party until it
has established that it has actually received it. However, the Facility Agent
may assume that the sum has been paid to it, and, in reliance on that
assumption, make available to that Party a corresponding amount. If it
transpires that the sum has not been received by the Facility Agent, that Party
must immediately on demand by the Facility Agent refund any corresponding amount
made available to it together with interest on that amount from the date of
payment to the date of receipt by the Facility Agent at a rate calculated by the
Facility Agent to reflect its cost of funds.

 

15.5 No set-off or counterclaim

 

     All payments made by the Company under the Finance Documents must be made
without (and free and clear of any deduction for) set-off or counterclaim.

 

15.6 Business Days

 

(a) If a payment under the Finance Documents is due on a day that is not a
Business Day, the due date for that payment will instead be the next Business
Day in the same calendar month (if there is one) or the preceding Business Day
(if there is not) or whatever day the Facility Agent determines is market
practice.

 

(b) During any extension of the due date for payment of any principal under this
Agreement interest is payable on that principal at the rate payable on the
original due date.

 

15.7 Partial payments

 

(a) If any Administrative Party receives a payment insufficient to discharge all
the amounts then due and payable by the Company under the Finance Documents, the
Administrative Party must apply that payment towards the obligations of the
Company under the Finance Documents in the following order:

 

  (i) first, in or towards payment pro rata of any unpaid fees, costs and
expenses of the Facility Agent, and then any other Administrative Party under
the Finance Documents;

 

23

--------------------------------------------------------------------------------

  (ii) secondly, in or towards payment pro rata of any accrued interest or fee
due but unpaid under this Agreement;

 

  (iii) thirdly, in or towards payment pro rata of any principal amount due but
unpaid under this Agreement; and

 

  (iv) fourthly, in or towards payment pro rata of any other sum due but unpaid
under the Finance Documents.

 

(b) The Facility Agent must, if so directed by all the Lenders, vary the order
set out in sub-paragraphs (a)(ii) to (iv) above.

 

(c) This Subclause will override any appropriation made by the Company.

 

15.8 Timing of payments

 

     If a Finance Document does not provide for when a particular payment is
due, that payment will be due 30 days after receipt by the Company of a claim
(accompanied by, if available, separate invoices) signed on behalf of the
relevant Finance Party specifying the amount due, the provision of the Finance
Document under which the Company’s liability to pay arises and setting out in
reasonable detail a calculation of the amount due.

 

16. REPRESENTATIONS AND WARRANTIES

 

16.1 Representations and warranties

 

     The Company makes the representations and warranties set out in this Clause
16 (Representations and warranties) to each Finance Party.

 

16.2 Status

 

(a) It is a limited liability company or, in the case of a Material Subsidiary,
a company limited by shares or a limited liability company, in each case duly
organised and validly existing under:

 

  (i) the laws of the Republic; or

 

  (ii) in the case of a Material Subsidiary operating and carrying on business
in another jurisdiction, in that jurisdiction.

 

(b) It has the power to own its property and Assets.

 

(c) It has power to carry on its business as it is now being conducted.

 

16.3 Powers and authority

 

     It has the power to enter into and perform, and has taken all necessary
action to authorise, the execution, delivery and performance of the Finance
Documents to which it is or will be a party and the transactions contemplated by
those Finance Documents.

 

24

--------------------------------------------------------------------------------

16.4 Legal validity

 

     Each Finance Document to which it is a party:

 

  (a) constitutes, or when executed will constitute, its legal, valid and
binding obligation enforceable in accordance with its terms; and

 

  (b) is in proper form for its enforcement in the Republic if accompanied by a
certified Slovak translation;

 

     save that enforcement of the Company’s obligations under the Finance
Documents may be affected by insolvency, bankruptcy and similar laws affecting
the rights of creditors generally.

 

16.5 Non-conflict

 

     The execution, delivery and performance of the Finance Documents to which
it is or will be a party will not:

 

  (a) violate in any respect any provision of:

 

  (i) any applicable law or regulation of the Republic or any order of any
governmental, judicial or public body or authority in the Republic; or

 

  (ii) the laws and documents incorporating and constituting the Company; or

 

  (iii) any mortgage, agreement or other financial undertaking or instrument to
which the Company is a party or which is binding upon or any Assets of the
Company; or

 

  (b) to the best of the Company’s knowledge result in the creation or
imposition of any Security Interest on any Assets of the Company pursuant to the
provisions of any mortgage, agreement or other undertaking or instrument to
which the Company is a party or which is binding upon it.

 

16.6 No default

 

     No Default is outstanding.

 

16.7 Authorisations

 

     All authorisations and other requirements of governmental, judicial and
public bodies and authorities required by any member of the Group or advisable
in connection with the execution, delivery, performance, validity and
enforceability of the Finance Documents have been obtained or effected and are
in full force and effect.

 

16.8 Litigation

 

     Except to the extent as disclosed in writing to the Facility Agent:

 

  (a) there is no litigation, arbitration or administrative proceedings relating
to any member of the Group that is material to the Company, the same are not
current or pending or, to the knowledge of the Company, threatened; and

 

  (b) no litigation, arbitration or administrative proceedings are current or
pending or, to the knowledge of the Company, threatened, which would reasonably
be expected to have a material adverse effect on the ability of the Company to
perform its obligations under the Finance Documents.

 

25

--------------------------------------------------------------------------------

16.9 Title

 

     Except to the extent disclosed in writing to the Facility Agent, it has
valid leases or good and marketable title to all its material Fixed Assets which
are reflected in the most recent audited consolidated financial statements of
the Group delivered to the Facility Agent under Clause 17.2 (Financial
Information), subject to any disposal permitted under Clause 17.10 (Disposals)
and to no Security Interest securing Financial Indebtedness over such Fixed
Assets, except any Permitted Security Interest.

 

16.10 Borrowing limits

 

     The borrowing of the full amount available under this Agreement will not
cause any limit on its borrowing or other powers or on the exercise of such
powers by its board of directors whether imposed by the Company’s Articles of
Association or similar document or by statute, regulation, or agreement, to be
exceeded.

 

16.11 Immunity

 

     Subject to any general provisions of law with respect to immunity of
certain assets from attachment and from execution, referred to in any legal
opinion required under this Agreement, it is not entitled to claim immunity from
suit, attachment, enforcement or other legal process in the Republic.

 

16.12 Solvency

 

(a) It is not insolvent, nor do its liabilities exceed its assets; and

 

(b) it has not taken any action nor, so far as it is aware have any steps been
taken or legal proceedings been started or threatened against it for winding-up,
dissolution, reorganisation, or bankruptcy the enforcement of any encumbrance
over its assets or for the appointment of a receiver, administrative receiver or
administrator, trustee or similar officer of it or of any or all of its assets
or revenues.

 

16.13 Information

 

(a) All factual information provided in writing by an officer of any member of
the Group, United States Steel Corporation or any Subsidiary of United States
Steel Corporation to the Finance Parties in connection with the Finance
Documents was true and accurate in all material respects as at its date or (if
appropriate) as at the date (if any) at which it is stated to be given by that
person.

 

(b) Nothing was omitted from the information referred to in paragraph (a) above
which, if disclosed, would make that information untrue or misleading in any
material respect.

 

(c) Nothing has occurred since the date of the information referred to in
paragraph (a) above which, if disclosed, would make that information untrue or
mislead in any material respect.

 

16.14 No notarial deed

 

     No member of the Group has created any notarial deed (as referred to in
section 41.2 of the Slovak Act No. 233/1995 Coll. and section 274(e) of the
Slovak Act No. 99/1963 Coll., as amended respectively) in relation to any
Financial Indebtedness.

 

26

--------------------------------------------------------------------------------

16.15 Financial statements

 

     Its audited consolidated financial statements most recently delivered to
the Facility Agent (which, at the date of this Agreement, are the Financial
Statements dated 31 December 2004):

 

  (a) have been prepared in accordance with accounting principles and practices
generally accepted in its jurisdiction of incorporation, consistently applied;
and

 

  (b) fairly represent its consolidated financial condition as at the date to
which they were drawn up,

 

     except, in each case, as disclosed to the contrary in those financial
statements.

 

16.16 Slovak Banking Act

 

  (a) It represents that it is not a person having any special relationship
(osobitný vzt’ah) as defined in the Slovak Act No. 483/2001 Coll., as amended,
to any Lender.

 

  (b) When making any payment under or in connection with any Finance Document,
it will use solely the funds owned by it.

 

  (c) It is entering into each Finance Document as a principal and not as agent
and, in its own name on its own account.

 

16.17 ERISA

 

     Each Plan of the Company and of each ERISA Affiliate of the Company
complies in all material respects with all applicable requirements of law and
regulation. No Reportable Event has occurred with respect to any Plan, and no
steps have been taken to terminate any Plan. Neither the Borrower nor any of its
ERISA Affiliates has had a complete or partial withdrawal from any Multiemployer
Plan or initiated any steps to do so.

 

16.18 Margin Regulations

 

     Neither the Company nor any of its Subsidiaries is engaged principally, or
as one of its important activities, in the business of extending credit for the
purpose of purchasing or carrying Margin Stock.

 

16.19 Times for making representations and warranties

 

(a) The representations and warranties set out in this Clause are made by the
Company on the date of this Agreement.

 

(b) Unless a representation and warranty is expressed to be given at a specific
date, each representation and warranty is deemed to be repeated by the Company
on the date of each Request and the first day of each Term except that the
representations and warranties in Clause 16.5(a)(iii) and (b) (Non-conflict),
16.8(a) (Litigation) and 16.17 (ERISA) shall not be repeated by the Company.

 

(c) When a representation and warranty is repeated, it is applied to the
circumstances existing at the time of repetition.

 

27

--------------------------------------------------------------------------------

17. UNDERTAKINGS

 

17.1 Duration

 

     The undertakings in this Clause 17 (Undertakings) remain in force from the
date of this Agreement for so long as any amount is or may be outstanding under
any Finance Document.

 

17.2 Financial Information

 

     The Company shall furnish to the Facility Agent in sufficient copies for
all Lenders:

 

  (a) the audited unconsolidated financial statements of the Company including
the report of independent auditors and accompanying notes for each of its
financial years as soon as practicable (and in any event within 120 days after
the end of each of its financial years),

 

and

 

the audited consolidated financial statements of the Group including the report
of independent auditors and accompanying notes for each of its financial years
as soon as practicable (and in any event within 30 days from the date when the
consolidated financial statements are required to be prepared by law),

 

such financial statements:

 

  (i) to be prepared in accordance with Slovak Accounting Standards consistently
applied;

 

  (ii) to be audited by an internationally recognised firm of accountants;

 

  (iii) to give a true and fair view of the financial condition of the Group and
the result of its operations for the period ended on the date to which such
financial statements were prepared; and

 

  (iv) signed by two senior officers of the Company;

 

  (b) the unaudited consolidated financial statements of the Group to be
prepared in accordance with USGAAP consistently applied, semi-annually, i.e.:

 

  (i) for each of its financial years as soon as practicable (and in any event
within 120 days after the end of each of its financial years) certified by the
chief financial officer (or equivalent) of the Company; and

 

  (ii) for the first half of each of its financial years as soon as practicable
(and in any event within 60 days after the end of the first half of each of its
financial years) certified by the chief financial officer (or equivalent) of the
Company; and

 

  (c) together with the financial statements referred to in paragraph (a) above,
a certificate of the Company signed by the chief financial officer (or
equivalent) of the Company certifying:

 

  (i) that no Event of Default has occurred (or, if it has, specifying it and
the steps being taken to remedy it); and

 

  (ii) the identity of its Material Subsidiaries.

 

28

--------------------------------------------------------------------------------

17.3 Information - miscellaneous

 

(a) The Company shall furnish to the Facility Agent from time to time with
reasonable promptness, such further information regarding the business and
financial condition of the Company as the Facility Agent may reasonably request.

 

(b) The Company shall promptly notify the Facility Agent of any material
business or financial event, including without limitation, any litigation,
arbitration, administrative or other proceedings being commenced, which would
reasonably be expected adversely to affect its ability to perform its
obligations under the Finance Documents.

 

(c) Subject to paragraph (d) below, The Company must promptly on the request of
any Finance Party supply to that Finance Party any documentation or other
evidence which is reasonably requested by that Finance Party (whether for
itself, on behalf of any Finance Party or any prospective new Lender) to enable
a Finance Party or prospective new Lender to carry out and be satisfied with the
results of all applicable know your customer requirements.

 

(d) The Company is only required to supply any information under paragraph
(a) above, if the necessary information is not already available to the relevant
Finance Party and the requirement arises as a result of:

 

  (i) the introduction of any change in (or in the interpretation,
administration or application of) any law or regulation made after the date of
this Agreement;

 

  (ii) any change in the status of the Company or any change in the composition
of shareholders of the Company after the date of this Agreement; or

 

  (iii) a proposed assignment or transfer by the Lender of any of its rights
and/or obligations under this Agreement to a person that is not a Lender before
that assignment or transfer.

 

(e) Each Lender must promptly on the request of the Facility Agent supply to the
Facility Agent any documentation or other evidence which is reasonably required
by the Facility Agent to carry out and be satisfied with the results of all know
your customer requirements.

 

(f) The Company shall promptly, but no later than on 30th day after the date of
the Agreement, deliver to the Facility Agent a copy of a resolution of the
executives of the Company approving the terms of, and the transactions
contemplated by, this Agreement, certified by an Authorised Signatory of the
Company to be true, correct and complete and in full force and effect at its
date.

 

17.4 Authorisations

 

The Company shall obtain and promptly renew from time to time all authorisations
as may be required under any applicable law or regulation to enable it to
perform its obligations under the Finance Documents, or required for the
validity or enforceability of any Finance Document, shall comply with the terms
of the same and will ensure the availability and transferability of sufficient
foreign exchange to enable it to comply with its obligations under the Finance
Documents.

 

17.5 Corporate existence

 

(a) The Company shall maintain its corporate existence and its right to carry on
its operations and will acquire, maintain and renew all rights, licences,
concessions, contracts, powers, privileges, leases, lands, sanctions and
franchises necessary or useful for the conduct of its operations except, in each
case, where the failure to do so would not reasonably be expected to materially
adversely affect the Company’s ability to perform its obligations under the
Finance Documents.

 

29

--------------------------------------------------------------------------------

(b) The Company shall not:

 

  (i) change its name; or

 

  (ii) change its financial year end from 31st December.

 

17.6 Insurance

 

     The Company shall, and shall procure that each Material Subsidiary shall,
effect and maintain such insurance over and in respect of its Assets and
business covering such risks and in such amounts as United States Steel
Corporation maintains from time to time with respect to other similar
steel-making facilities owned by United States Steel Corporation, subject to
such deductibles and other forms of self-insurance as from time to time are
generally applicable to such other steel-making facilities provided such
coverage is available to the Company on similar or better terms.

 

17.7 Notification of Default

 

     The Company shall notify the Facility Agent of any Default promptly upon
becoming aware of its occurrence.

 

17.8 Pari passu

 

     The Company shall procure that its obligations under the Finance Documents
do and will constitute its direct, unconditional, unsecured, unsubordinated and
general obligations and do and will rank at least pari passu with all other
present and future unsecured and unsubordinated Financial Indebtedness issued,
created or assumed by it other than amounts which are afforded priority by
applicable law.

 

17.9 Negative pledge

 

     The Company shall not, and shall procure that none of its Material
Subsidiaries shall, without the prior consent of the Facility Agent in writing,
create, assume or permit to exist any Security Interest over all or any of its
Assets to secure Financial Indebtedness other than a Permitted Security
Interest.

 

17.10 Disposals

 

(a) Except with the prior consent of the Facility Agent in writing or as
provided in paragraph (b) below, the Company shall not, and shall procure that
none of its Material Subsidiaries shall, either in a single transaction or in a
series of transactions whether related or not and whether voluntary or
involuntary, sell, transfer, grant or lease or otherwise dispose of (in each
case whether conditionally or otherwise) any of its Fixed Assets other than
Permitted Disposals.

 

(b) Notwithstanding paragraph (a) above, in any financial year of the Company,
Fixed Assets having an aggregate book value in, or included for the purposes of,
the Latest Accounts, not exceeding the aggregate of:

 

  (i) 15 per cent. of all Fixed Assets (as shown in or included for the purposes
of the Latest Accounts); and

 

  (ii) any amount of the 15 per cent. not disposed of in the immediately
preceding financial year of the Company,

 

30

--------------------------------------------------------------------------------

     may be disposed of where the disposal is a sale on arm’s length commercial
terms, provided that the cumulative totals of the percentage figures referred to
in each of sub-paragraphs (i) and (ii) above, until the Final Maturity Date, do
not exceed 50 per cent. of all Fixed Assets.

 

17.11 Mergers

 

     The Company shall not, without the prior consent of the Facility Agent in
writing, enter into any merger or other arrangement of a similar nature other
than a Permitted Merger.

 

17.12 Change of business

 

     Except with the prior consent of the Facility Agent in writing, the Company
shall not and shall procure that none of its Material Subsidiaries shall, make
or threaten to make any substantial change in its business as conducted on the
date of this Agreement.

 

17.13 Environmental compliance

 

     Except to the extent disclosed in writing to the Facility Agent, the
Company shall, and shall procure that each Material Subsidiary shall, comply
with applicable Environmental Law except where failure to do so would not
reasonably be expected to have a material adverse effect on the ability of the
Company to perform its obligations under the Finance Documents. For this
purpose, Environmental Law means:

 

  (a) all environmental authorisations applicable to the Company and each
Material Subsidiary; and

 

  (b) all other applicable environmental laws, rules and regulations concerning
the protection of human health or the environment or the transportation of any
substance capable of causing harm to man or any other living organism or the
environment or public health or welfare, including, without limitation,
hazardous, toxic, radioactive or dangerous waste.

 

17.14 Lending and Borrowing

 

     The Company shall not, and the Company shall procure that no member of the
Group shall incur any Financial Indebtedness other than:

 

  (a) amounts up to €500,000,000 (or its equivalent) in aggregate as external
debt (including amounts borrowed under the Finance Documents), and combined
internal and external debt up to €600,000,000 (or its equivalent) in aggregate
(including amounts borrowed under the Finance Documents);

 

  (b) Financial Indebtedness upon terms approved by the Facility Agent acting on
the instructions of the Majority Lenders;

 

  (c) currency and commodity hedging used only to mitigate the risks relating to
fluctuations in currencies and commodity prices, provided each such hedging
arrangement is entered into for a period no longer than 18 months.

 

  (d) operating lease obligations;

 

  (e) trade payables and other contractual obligations to suppliers and
customers in the ordinary course of trading;

 

31

--------------------------------------------------------------------------------

  (f) debt subordinated to the Loans under subordination agreements acceptable
to the Facility Agent;

 

  (g) Financial Indebtedness disclosed in writing to the Facility Agent on the
date of this Agreement; and

 

  (h) any refinance of any of the above up to the same principal amount.

 

17.15 No notarial deed

 

     The Company shall not and the Company shall procure that no other member of
the Group will, create any notarial deed (as referred to in section 41.2 of the
Slovak Act No. 233/1995 Coll., as amended) in relation to any Financial
Indebtedness.

 

17.16 Capital Expenditure

 

     The Company shall procure that no member of the Group, other than a
Material Subsidiary or the Company, shall, without the consent of an Instructing
Group notified to the Company by the Facility Agent in writing, make any capital
expenditure, where in any financial year the aggregate amount of such capital
expenditure made (by members of the Group not being the Company or a Material
Subsidiary) would exceed U.S.$10,000,000.

 

17.17 No Margin Stock

 

     The Company may not:

 

  (a) extend credit for the purpose, directly or indirectly, of buying or
carrying Margin Stock; or

 

  (b) use any Loan or allow any Loan to be used, directly or indirectly, to buy
or carry Margin Stock or for any other purpose in violation of the Margin
Regulations.

 

18. EVENTS OF DEFAULT

 

18.1 Events of Default

 

     Each of the events set out in Clauses 18.2 (Non-payment) to 18.11 (Material
adverse change) (inclusive) is an Event of Default (whether or not caused by any
reason whatsoever outside the control of the Company or any other person).

 

18.2 Non-payment

 

     The Company does not pay on the due date any amount payable by it under the
Finance Documents at the place at and in the currency in which it is expressed
to be payable and (if the failure to pay is caused solely by technical or
administrative error) it is not remedied within five Business Days of its due
date.

 

18.3 Breach of other obligations

 

     The Company fails to comply with any of its obligations under the Finance
Documents (other than those referred to in Clause 18.2 (Non-payment)) and the
failure to comply (if it is capable of remedy) remains unremedied for 30 days
after the Facility Agent gives the Company notice of the failure to comply.

 

32

--------------------------------------------------------------------------------

18.4 Misrepresentation

 

     Any representation, warranty or statement made or repeated in the Finance
Documents or in any written certificate or statement delivered, made or issued
by or on behalf of the Company under the Finance Documents or in connection with
the Finance Documents shall at any time be incorrect in any respect when so made
or repeated or deemed to be made or repeated and the circumstances giving rise
to such misrepresentation would reasonably be expected to have a material
adverse effect on the ability of the Company to perform its obligations under
the Finance Documents.

 

18.5 Insolvency/enforcement

 

(a) Any action shall be taken by the Company or one of its Affiliates for the
dissolution or termination of existence or liquidation of the Company; or

 

(b) an application by the Company for a bankruptcy judgement, commencement of
settlement procedure (dohodovacie konanie) or restructuring (reštrukturalizácia)
or moratorium, or an arrangement with creditors of the Company is entered into,
or any other proceeding or arrangement by which the Assets of the Company are
submitted to the control of its creditors occurs or is entered into; or

 

(c) the Company is adjudged a bankrupt; or

 

(d) there shall be appointed a liquidator, trustee, administrator, receiver or
similar officer of the Company or a receiver of all or substantially all of the
Assets of the Company; or

 

(e) all or substantially all of the Assets of the Company shall be attached or
distrained upon or the same shall become subject at any time to any order of a
court or other process and such attachment, distraint, order or process shall
remain in effect and shall not be discharged within thirty days; or

 

(f) the Company shall become insolvent or its liabilities exceed its assets or
be declared insolvent by a competent governmental or judicial authority or shall
admit in writing its inability to pay its debts as they fall due; or

 

(g) a moratorium shall be made or declared in respect of all or any Financial
Indebtedness of the Company.

 

18.6 Cessation of business

 

     The Company ceases or threatens to cease to carry on the whole or a
substantial part of its business, save as permitted by Clause 17.10 (Disposals),
save for in the case of a Material Subsidiary, for the purposes of a Permitted
Merger.

 

18.7 Revocation of authorisation

 

(a) Any authorisation or other requirement of any governmental, judicial or
public body or authority necessary to enable the Company under any applicable
law or regulation to perform its obligations under the Finance Documents or for
its businesses or required for the validity or enforceability of the Finance
Documents shall be modified, revoked, withdrawn or withheld in any material
respect or shall fail to remain in full force and effect for more than 30 days.

 

(b) The Company fails to comply with any authorisation or other requirement set
out in paragraph (a) above.

 

33

--------------------------------------------------------------------------------

18.8 Expropriation

 

     All or any substantial part of the Assets of the Company shall be seized or
expropriated by any authority.

 

18.9 Unlawfulness

 

     At any time it is unlawful for the Company to perform such of its
obligations under the Finance Document as are, in the reasonable opinion of the
Facility Agent, material.

 

18.10 Ownership of the Company

 

     The entire commercial participation of the Company or the entire commercial
participation or share capital of a Material Subsidiary (as determined on an
annualised basis for the financial year ended 31st December, 2004) after the
date of this Agreement ceases to be directly or indirectly beneficially owned by
United States Steel Corporation, unless such cessation results from a Permitted
Merger.

 

18.11 Material adverse change

 

     There shall occur any material adverse change in the business, Assets,
regulation or financial condition of the Company that would reasonably be
expected to have a material adverse effect on the Company’s ability to perform
its obligations under the Finance Documents.

 

18.12 Acceleration

 

     If an Event of Default is outstanding, the Facility Agent may, and must if
so directed by the Majority Lenders, by notice to the Company:

 

  (a) cancel the Total Commitments; and/or

 

  (b) declare that all or part of any amounts outstanding under the Finance
Documents are:

 

  (i) immediately due and payable; and/or

 

  (ii) payable on demand by the Facility Agent acting on the instructions of the
Majority Lenders.

 

     Any notice given under this Subclause will take effect in accordance with
its terms.

 

19. THE ADMINISTRATIVE PARTIES

 

19.1 Appointment and duties of the Facility Agent

 

     Each Finance Party (other than the Facility Agent) irrevocably appoints the
Facility Agent to act as its agent under and in connection with the Finance
Documents, and irrevocably authorises the Facility Agent on its behalf to
perform the duties and to exercise the rights, powers and discretions that are
specifically delegated to it under or in connection with the Finance Documents,
together with any other incidental rights, powers and discretions. The Facility
Agent has only those duties which are expressly specified in the Finance
Documents, and those duties are solely of a mechanical and administrative
nature.

 

19.2 Role of the Arrangers

 

     Except as specifically provided in the Finance Documents, none of the
Arrangers has any obligations of any kind to any other Party in connection with
any Finance Document.

 

34

--------------------------------------------------------------------------------

19.3 No fiduciary duties

 

     Except as specifically provided in a Finance Document, nothing in the
Finance Documents makes an Administrative Party a trustee or fiduciary for any
other Party or any other person. No Administrative Party need hold in trust any
moneys paid to it for a Party or be liable to account for interest on those
moneys.

 

19.4 Individual position of an Administrative Party

 

(a) If it is also a Lender, each Administrative Party has the same rights and
powers under the Finance Documents as any other Lender and may exercise those
rights and powers as though it were not an Administrative Party.

 

(b) Each Administrative Party may:

 

  (i) carry on any business with the Company or its related entities (including
acting as an agent or a trustee for any other financing); and

 

  (ii) retain any profits or remuneration it receives under the Finance
Documents or in relation to any other business it carries on with the Company or
its related entities.

 

19.5 Reliance

 

     The Facility Agent may:

 

  (a) rely on any notice or document believed by it to be genuine and correct
and to have been signed by, or with the authority of, the proper person;

 

  (b) rely on any statement made by any person regarding any matters that may
reasonably be assumed to be within his knowledge or within his power to verify;

 

  (c) engage, pay for and rely on professional advisers selected by it
(including those representing a Party other than the Facility Agent); and

 

  (d) act under the Finance Documents through its personnel and agents.

 

19.6 Majority Lenders’ instructions

 

(a) The Facility Agent is fully protected if it acts on the instructions of the
Majority Lenders in the exercise of any right, power or discretion or any matter
not expressly provided for in the Finance Documents. Any such instructions given
by the Majority Lenders will be binding on all the Lenders. In the absence of
instructions, the Facility Agent may act as it considers to be in the best
interests of all the Lenders.

 

(b) The Facility Agent is not authorised to act on behalf of a Lender (without
first obtaining that Lender’s consent) in any legal or arbitration proceedings
in connection with any Finance Document.

 

(c) The Facility Agent may require the receipt of security satisfactory to it,
whether by way of payment in advance or otherwise, against any liability or loss
which it may incur in complying with the instructions of the Majority Lenders.

 

19.7 Responsibility

 

(a) No Administrative Party is responsible to any other Finance Party for the
adequacy, accuracy or completeness of:

 

  (i) any Finance Document or any other document; or

 

35

--------------------------------------------------------------------------------

  (ii) any statement or information (whether written or oral) made in or
supplied in connection with any Finance Document.

 

(b) Without affecting the responsibility of the Company for information supplied
by it or on its behalf in connection with any Finance Document, each Lender
confirms that it:

 

  (i) has made, and will continue to make, its own independent appraisal of all
risks arising under or in connection with the Finance Documents (including the
financial condition and affairs of the Company and its related entities and the
nature and extent of any recourse against any Party or its assets); and

 

  (ii) has not relied exclusively on any information provided to it by any
Administrative Party in connection with any Finance Document.

 

19.8 Exclusion of liability

 

(a) The Facility Agent is not liable to any other Finance Party for any action
taken or not taken by it in connection with any Finance Document, unless
directly caused by its gross negligence or wilful misconduct.

 

(b) No Party may take any proceedings against any officer, employee or agent of
the Facility Agent in respect of any claim it might have against the Facility
Agent or in respect of any act or omission of any kind by that officer, employee
or agent in connection with any Finance Document. Any officer, employee or agent
of the Facility Agent may rely on this Subclause and enforce its terms under the
Contracts (Rights of Third Parties) Act 1999.

 

(c) The Facility Agent is not liable for any delay (or any related consequences)
in crediting an account with an amount required under the Finance Documents to
be paid by the Facility Agent if the Facility Agent has taken all necessary
steps as soon as reasonably practicable to comply with the regulations or
operating procedures of any recognised clearing or settlement system used by the
Facility Agent for that purpose.

 

(d) Nothing in this Agreement will oblige any Administrative Party to satisfy
any know your customer requirement in relation to the identity of any person on
behalf of any other Finance Party.

 

(e) Each Finance Party confirms to each Administrative Party that it is solely
responsible for any know your customer requirements it is required to carry out
and that it may not rely on any statement in relation to those requirements made
by any other person.

 

19.9 Default

 

(a) The Facility Agent is not obliged to monitor or enquire whether a Default
has occurred. The Facility Agent is not deemed to have knowledge of the
occurrence of a Default.

 

(b) If the Facility Agent:

 

  (i) receives notice from a Party referring to this Agreement, describing a
Default and stating that the event is a Default; or

 

  (ii) is aware of the non-payment of any principal or interest or any fee
payable to a Lender under this Agreement,

 

     it must promptly notify the Lenders.

 

36

--------------------------------------------------------------------------------

19.10 Information

 

(a) The Facility Agent must promptly forward to the person concerned the
original or a copy of any document that is delivered to the Facility Agent by a
Party for that person.

 

(b) Except where a Finance Document specifically provides otherwise, the
Facility Agent is not obliged to review or check the adequacy, accuracy or
completeness of any document it forwards to another Party.

 

(c) Except as provided above, the Facility Agent has no duty:

 

  (i) either initially or on a continuing basis to provide any Lender with any
credit or other information concerning the risks arising under or in connection
with the Finance Documents (including any information relating to the financial
condition or affairs of the Company or its related entities or the nature or
extent of recourse against any Party or its assets) whether coming into its
possession before, on or after the date of this Agreement; or

 

  (ii) unless specifically requested to do so by a Lender in accordance with a
Finance Document, to request any certificate or other document from the Company.

 

(d) In acting as the Facility Agent, the agency division of the Facility Agent
is treated as a separate entity from its other divisions and departments. Any
information acquired by the Facility Agent which, in its opinion, is acquired by
it otherwise than in its capacity as the Facility Agent may be treated as
confidential by the Facility Agent and will not be treated as information
possessed by the Facility Agent in its capacity as such.

 

(e) The Company irrevocably authorises the Facility Agent to disclose to the
other Finance Parties any information which, in its opinion, is received by it
in its capacity as the Facility Agent.

 

(f) The Facility Agent is not obliged to disclose to any person any confidential
information supplied to it by or on behalf of a member of the Group solely for
the purpose of evaluating whether any waiver or amendment is required in respect
of any term of the Finance Documents.

 

19.11 Indemnities

 

(a) Without limiting the liability of the Company under the Finance Documents,
each Lender must indemnify the Facility Agent for that Lender’s Pro Rata Share
of any loss or liability incurred by the Facility Agent in acting as the
Facility Agent, except to the extent that the loss or liability is caused by the
Facility Agent’s gross negligence or wilful misconduct.

 

(b) The Facility Agent may deduct from any amount received by it for a Lender
any amount due to the Facility Agent from that Lender under a Finance Document
but unpaid and a Lender may deduct from any amount owed to the Facility Agent
any amount due to that Lender from the Facility Agent under a Finance Document
but unpaid.

 

19.12 Compliance

 

(a) The Facility Agent may refrain from doing anything (including the disclosure
of any information) which might, in its opinion, constitute a breach of any law
or regulation or be otherwise actionable at the suit of any person, and may do
anything which, in its opinion, is necessary or desirable to comply with any law
or regulation.

 

37

--------------------------------------------------------------------------------

(b) Without limiting paragraph (a) above, the Facility Agent need not disclose
any information relating to the Company or any of its related entities if the
disclosure might, in the opinion of the Facility Agent, constitute a breach of
any law or regulation or any duty of secrecy or confidentiality or be otherwise
actionable at the suit of any person.

 

19.13 Resignation of the Facility Agent

 

(a) The Facility Agent may resign and appoint any of its Affiliates as successor
Facility Agent by giving notice to the Lenders and the Company.

 

(b) Alternatively, the Facility Agent may resign by giving notice to the Lenders
and the Company, in which case the Majority Lenders may appoint a successor
Facility Agent.

 

(c) If no successor Facility Agent has been appointed under paragraph (b) above
within 30 days after notice of resignation was given, the Facility Agent may
appoint a successor Facility Agent.

 

(d) The person(s) appointing a successor Facility Agent must, if practicable,
consult with the Company prior to the appointment. Any successor Facility Agent
must have an office in the Republic.

 

(e) The resignation of the Facility Agent and the appointment of any successor
Facility Agent will both become effective only when the successor Facility Agent
notifies all the Parties that it accepts its appointment. On giving the
notification, the successor Facility Agent will succeed to the position of the
Facility Agent and the term Facility Agent will mean the successor Facility
Agent.

 

(f) The retiring Facility Agent must, at its own cost, make available to the
successor Facility Agent such documents and records and provide such assistance
as the successor Facility Agent may reasonably request for the purposes of
performing its functions as the Facility Agent under the Finance Documents.

 

(g) Upon its resignation becoming effective, this Clause will continue to
benefit the retiring Facility Agent in respect of any action taken or not taken
by it in connection with the Finance Documents while it was the Facility Agent,
and, subject to paragraph (f) above, it will have no further obligations under
any Finance Document.

 

(h) The Majority Lenders may, by notice to the Facility Agent, require it to
resign under paragraph (b) above.

 

19.14 Relationship with Lenders

 

(a) The Facility Agent may treat each Lender as a Lender, entitled to payments
under this Agreement and as acting through its Facility Office(s) until it has
received not less than five Business Days’ prior notice from that Lender to the
contrary.

 

(b) The Facility Agent may at any time, and must if requested to do so by the
Majority Lenders, convene a meeting of the Lenders.

 

(c) The Facility Agent must keep a register of all the Parties and supply any
other Party with a copy of the register on request. The register will include
each Lender’s Facility Office(s) and contact details for the purposes of this
Agreement.

 

19.15 Facility Agent’s management time

 

     If the Facility Agent requires, any amount payable to the Facility Agent by
any Party under any indemnity or in respect of any costs or expenses incurred by
the Facility Agent under the Finance

 

38

--------------------------------------------------------------------------------

     Documents after the date of this Agreement may include the cost of using
its management time or other resources and will be calculated on the basis of
such reasonable daily or hourly rates as the Facility Agent may notify to the
relevant Party. This is in addition to any amount in respect of fees or expenses
paid or payable to the Facility Agent under any other term of the Finance
Documents.

 

19.16 Notice period

 

     Where this Agreement specifies a minimum period of notice to be given to
the Facility Agent, the Facility Agent may, at its discretion, accept a shorter
notice period.

 

20. EVIDENCE AND CALCULATIONS

 

20.1 Accounts

 

     Accounts maintained by a Finance Party in connection with this Agreement
are prima facie evidence of the matters to which they relate.

 

20.2 Certificates and determinations

 

     Any certification or determination by a Finance Party of a rate or amount
under the Finance Documents will be, in the absence of manifest error,
conclusive evidence of the matters to which it relates.

 

20.3 Calculations

 

     Any interest or fee accruing under this Agreement accrues from day to day
and is calculated on the basis of the actual number of days elapsed and a year
of 360 or 365 days or otherwise, depending on what the Facility Agent
determines, after consultation with the Company, is market practice.

 

21. FEES

 

21.1 Arrangement fee

 

     The Company must pay to the Facility Agent an Arrangement Fee in the manner
agreed in the Fee Letter. The Arrangement Fee is payable to the Facility Agent,
to be divided amongst the Arrangers pro-rata to their Commitments expressed in
Schedule 1, and is payable regardless of whether or not the Company draws down
under this Facility Agreement.

 

21.2 Facility Agent’s fee

 

     The Company must pay to the Facility Agent for its own account an agency
fee in the manner agreed in the Fee Letter between the Facility Agent and the
Company.

 

21.3 Commitment fee

 

     The Company must pay a commitment fee computed at the rate of 0.10 per
cent. per annum on the undrawn, uncancelled amount of each Lender’s Commitment.

 

     Accrued commitment fee is payable quarterly in arrear. Accrued commitment
fee is also payable to the Facility Agent for a Lender on the date its
Commitment is cancelled in full.

 

21.4 Participation fee

 

     The Company must pay a participation fee computed at the rate of 0.05 per
cent. flat on €195,000,000, being €97,500, on the earlier of the date of first
utilisation and the date 15 days after

 

39

--------------------------------------------------------------------------------

     the date of the signing of this Facility Agreement. The Participation Fee
is payable to the Facility Agent, to be divided amongst the Lenders pro-rata to
their participation in the lending under the Facility Agreement, and is payable
regardless of whether or not the Company draws down under this Facility
Agreement.

 

22. INDEMNITIES AND BREAK COSTS

 

22.1 Currency indemnity

 

(a) If a Finance Party receives an amount in respect of the Company’s liability
under the Finance Documents (other than by reason of the Facility Agent not
performing its obligations under this Agreement) or if that liability is
converted into a claim, proof, judgement or order in a currency other than the
currency (the contractual currency) in which the liability is expressed to be
payable under the relevant Finance Document:

 

  (i) the Company shall indemnify that Finance Party as an independent
obligation against any loss or liability arising out of or as a result of the
conversion;

 

  (ii) if the amount received by that Finance Party, when converted into the
contractual currency at a market rate in the usual course of its business is
less than the amount owed in the contractual currency, the Company concerned
shall pay to that Finance Party an amount in the contractual currency equal to
the deficit; and

 

  (iii) the Company shall pay to the Finance Party concerned any exchange costs
and taxes payable in connection with any such conversion.

 

(b) The Company waives any right it may have in any jurisdiction to pay any
amount under the Finance Documents in a currency other than that in which it is
expressed to be payable.

 

22.2 Other indemnities

 

(a) The Company must indemnify each Finance Party against any loss or liability
that a Finance Party incurs as a consequence of:

 

  (i) the occurrence of any Event of Default;

 

  (ii) Clause 18.12 (Acceleration);

 

  (iii) any failure by the Company to pay any amount due under a Finance
Document on its due date, including any resulting from any distribution or
redistribution of any amount among the Lenders under this Agreement;

 

  (iv) (other than by reason of negligence or default by that Finance Party) a
Loan not being made after a Request has been delivered for that Loan and not
cancelled; or

 

  (v) a Loan (or part of a Loan) not being prepaid in accordance with a notice
of prepayment.

 

     The Company’s liability in each case includes any loss or expense on
account of funds borrowed, contracted for or utilised to fund any amount payable
under any Finance Document, any amount repaid or prepaid or any Loan.

 

(b) The Company must indemnify the Facility Agent against any loss or liability
incurred by the Facility Agent as a result of:

 

  (i) investigating any event which the Facility Agent reasonably believes to be
a Default; or

 

40

--------------------------------------------------------------------------------

  (ii) acting or relying on any notice that it reasonably believes to be
genuine, correct and appropriately authorised.

 

22.3 Break Costs

 

(a) The Company must pay to each Lender its Break Costs.

 

(b) Break Costs are the amount (if any) reasonably determined by the relevant
Lender concerned by which:

 

  (i) the interest which that Lender would have received for the period from the
date of receipt of any part of its share in a Loan or an overdue amount to the
last day of the applicable Term for that Loan or overdue amount if the principal
or overdue amount received had been paid on the last day of that Term;

 

     exceeds

 

  (ii) the amount which that Lender would be able to obtain by placing an amount
equal to the amount received by it on deposit with a leading bank in the
appropriate interbank market for a period starting on the Business Day following
receipt and ending on the last day of the applicable Term.

 

(c) Each Lender must promptly supply to the Facility Agent for the Company
details of the amount of any Break Costs claimed by it under this Subclause.

 

23. EXPENSES

 

23.1 Initial costs

 

     The Company must pay to each Administrative Party the amount of all costs
and expenses (including legal fees) reasonably incurred by it in connection with
the negotiation and preparation (regardless of whether any Loan is drawn down),
printing, execution and syndication of the Finance Documents, with a cap on
legal fees of USD25,000.00 in relation to this Clause 23.1.

 

23.2 Subsequent costs

 

     The Company must pay to the Facility Agent the amount of all costs and
expenses (including legal fees) reasonably incurred by it in connection with:

 

  (a) the negotiation, preparation, printing and execution of any Finance
Document (other than a Transfer Certificate) executed after the date of this
Agreement; and

 

  (b) any amendment, waiver or consent requested by or on behalf of the Company
or specifically allowed by this Agreement.

 

23.3 Enforcement costs

 

     The Company must pay to each Finance Party the amount of all costs and
expenses (including legal fees) incurred by it in connection with the
enforcement of, or the preservation of any rights under, any Finance Document
following an Event of Default.

 

41

--------------------------------------------------------------------------------

24. AMENDMENTS AND WAIVERS

 

24.1 Procedure

 

(a) Except as provided in this Clause, any term of the Finance Documents may be
amended or waived with the agreement of the Company and the Majority Lenders.
The Facility Agent may effect, on behalf of any Finance Party, an amendment or
waiver allowed under this Clause.

 

(b) The Facility Agent must promptly notify the other Parties of any amendment
or waiver effected by it under paragraph (a) above. Any such amendment or waiver
is binding on all the Parties.

 

24.2 Exceptions

 

(a) An amendment or waiver which relates to:

 

  (i) the definition of Majority Lenders in Clause 1.1 (Definitions);

 

  (ii) an extension of the date of payment of any amount to a Lender under the
Finance Documents;

 

  (iii) a reduction in the Margin or a reduction in the amount of any payment of
principal, interest, fee or other amount payable to a Lender under the Finance
Documents;

 

  (iv) an increase in, or an extension of, a Commitment or the Total
Commitments;

 

  (v) a release of the Company;

 

  (vi) a term of a Finance Document which expressly requires the consent of each
Lender;

 

  (vii) the right of a Lender to assign or transfer its rights or obligations
under the Finance Documents; or

 

  (viii) this Clause,

 

     may only be made with the consent of all the Lenders.

 

(b) An amendment or waiver that relates to the rights or obligations of an
Administrative Party may only be made with the consent of that Administrative
Party.

 

(c) A Fee Letter may be amended or waived with the agreement of the
Administrative Party that is a party to that Fee Letter and the Company.

 

24.3 Change of currency

 

     If a change in any currency of a country occurs (including where there is
more than one currency or currency unit recognised at the same time as the
lawful currency of a country), the Finance Documents will be amended to the
extent the Facility Agent (acting reasonably and after consultation with the
Company) determines is necessary to reflect the change.

 

24.4 Waivers and remedies cumulative

 

     The rights of each Finance Party under the Finance Documents:

 

  (a) may be exercised as often as necessary;

 

42

--------------------------------------------------------------------------------

  (b) are cumulative and not exclusive of its rights under the general law; and

 

  (c) may be waived only in writing and specifically.

 

     Delay in exercising or non-exercise of any right is not a waiver of that
right.

 

25. CHANGES TO THE PARTIES

 

25.1 General

 

     In this Clause:

 

     Transfer Date means, for a Transfer Certificate, the later of:

 

  (a) the proposed Transfer Date specified in that Transfer Certificate; and

 

  (b) the date on which the Facility Agent executes that Transfer Certificate.

 

25.2 Assignments and transfers by the Company

 

     The Company may not assign or transfer any of its rights and obligations
under the Finance Documents without the prior consent of all the Lenders.

 

25.3 Assignments and transfers by Lenders

 

(a) A Lender (the Existing Lender) may, with the consent of the Company (such
consent not to be unreasonably withheld or delayed) at any time assign or
transfer (including by way of novation) any of its rights and obligations under
this Agreement to another bank or financial institution (the New Lender).

 

(b) A transfer of obligations will be effective only if either:

 

  (i) the obligations are novated in accordance with the following provisions of
this Clause; or

 

  (ii) the New Lender confirms to the Facility Agent and the Company in form and
substance satisfactory to the Facility Agent that it is bound by the terms of
this Agreement as a Lender. On the transfer becoming effective in this manner
the Existing Lender will be released from its obligations under this Agreement
to the extent that they are transferred to the New Lender.

 

(c) Unless the Facility Agent otherwise agrees, the New Lender must pay to the
Facility Agent for its own account, on or before the date any assignment or
transfer occurs, a fee of USD1,000.

 

(d) Any reference in this Agreement to a Lender includes a New Lender but
excludes a Lender if no amount is or may be owed to or by it under this
Agreement.

 

25.4 Procedure for transfer by way of novations

 

(a) A novation is effected if:

 

  (i) the Existing Lender and the New Lender deliver to the Facility Agent and
the Company a duly completed Transfer Certificate; and

 

  (ii) the Facility Agent and the Company execute it.

 

43

--------------------------------------------------------------------------------

     The Facility Agent must execute as soon as reasonably practicable a
Transfer Certificate delivered to it and which appears on its face to be in
order.

 

(b) Each Party (other than the Company, the Existing Lender and the New Lender)
irrevocably authorises the Facility Agent to execute any duly completed Transfer
Certificate on its behalf.

 

(c) On the Transfer Date:

 

  (i) the New Lender will assume the rights and obligations of the Existing
Lender expressed to be the subject of the novation in the Transfer Certificate
in substitution for the Existing Lender; and

 

  (ii) the Existing Lender will be released from those obligations and cease to
have those rights.

 

25.5 Limitation of responsibility of Existing Lender

 

     Unless expressly agreed to the contrary, an Existing Lender makes no
representation or warranty and assumes no responsibility to a New Lender for:

 

  (a) the financial condition of the Company; or

 

  (b) the legality, validity, effectiveness, enforceability, adequacy, accuracy,
completeness or performance of:

 

  (i) any Finance Document or any other document;

 

  (ii) any statement or information (whether written or oral) made in or
supplied in connection with any Finance Document, or

 

  (iii) any observance by the Company of its obligations under any Finance
Document or other documents.

 

(c) Each New Lender confirms to the Existing Lender and the other Finance
Parties that it:

 

  (i) has made, and will continue to make, its own independent appraisal of all
risks arising under or in connection with the Finance Documents (including the
financial condition and affairs of the Company and its related entities and the
nature and extent of any recourse against any Party or its assets) in connection
with its participation in this Agreement; and

 

  (ii) has not relied exclusively on any information supplied to it by the
Existing Lender in connection with any Finance Document.

 

(d) Nothing in any Finance Document requires an Existing Lender to:

 

  (i) accept a re-transfer from a New Lender of any of the rights and
obligations assigned or transferred under this Clause; or

 

  (ii) support any losses incurred by the New Lender by reason of the
non-performance by the Company of its obligations under any Finance Document or
otherwise.

 

44

--------------------------------------------------------------------------------

25.6 Costs resulting from change of Lender or Facility Office

 

     If:

 

  (a) a Lender assigns or transfers any of its rights and obligations under the
Finance Documents or changes its Facility Office; and

 

  (b) as a result of circumstances existing at the date the assignment, transfer
or change occurs, the Company would be obliged to pay a Tax Payment or an
Increased Cost,

 

     then, unless the assignment, transfer or change is made by a Lender to
mitigate any circumstances giving rise to the Tax Payment, Increased Cost or
right to be prepaid and/or cancelled by reason of illegality, the Company need
only pay that Tax Payment or Increased Cost to the same extent that it would
have been obliged to if no assignment, transfer or change had occurred.

 

25.7 Changes to the Reference Banks

 

     If a Reference Bank (or, if a Reference Bank is not a Lender, the Lender of
which it is an Affiliate) ceases to be a Lender, the Facility Agent must (in
consultation with the Company) appoint another Lender or an Affiliate of a
Lender to replace that Reference Bank.

 

26. DISCLOSURE OF INFORMATION

 

(a) Each Finance Party must keep confidential any information supplied to it by
or on behalf of the Company in connection with the Finance Documents. However, a
Finance Party is entitled to disclose information:

 

  (i) which is publicly available, other than as a result of a breach by that
Finance Party of this Clause;

 

  (ii) in connection with any legal or arbitration proceedings;

 

  (iii) if required to do so under any law or regulation;

 

  (iv) to a governmental, banking, taxation or other regulatory authority;

 

  (v) to its professional advisers;

 

  (vi) to the extent allowed under paragraph (b) or (c) below; or

 

  (vii) with the agreement of the Company.

 

(b) A Finance Party may (save in relation to any Fee Letter to which it is not a
party) disclose to an Affiliate or any person with whom it may enter, or has
entered into, any kind of transfer, participation or other agreement in relation
to this Agreement (a participant):

 

  (i) a copy of any Finance Document; and

 

  (ii) any information which that Finance Party has acquired under or in
connection with any Finance Document.

 

     However, before a participant may receive any confidential information, it
must agree with the relevant Finance Party to keep that information confidential
on the terms of paragraph (a) above.

 

45

--------------------------------------------------------------------------------

  (c) This Clause supersedes any previous confidentiality undertaking given by a
Finance Party in connection with this Agreement prior to it becoming a Party.

 

27. SET-OFF

 

(a) A Finance Party may set off any matured obligation owed to it by the Company
under the Finance Documents (to the extent beneficially owned by that Finance
Party) against any obligation (whether or not matured) owed by that Finance
Party to the Company, regardless of the place of payment, booking branch or
currency of either obligation. If the obligations are in different currencies,
the Finance Party may convert either obligation at a market rate of exchange in
its usual course of business for the purpose of the set-off. If either
obligation is unliquidated or unascertained, the Finance Party may set off in an
amount estimated by it in good faith to be the amount of that obligation.

 

(b) The Company agrees to and confirms the Lenders rights of banker’s lien and
set-off under applicable law and nothing herein shall be deemed a waiver or
prohibition of such right. Each Finance Party agrees to exercise such rights
only after the Company’s failure to pay following proper demand and to promptly
notify the Company after any such set off and application; provided, however,
that the failure to give such notice shall not affect the validity of such
set-off and application.

 

28. PRO RATA SHARING

 

28.1 Redistribution

 

     If any amount owing by the Company under this Agreement to a Lender (the
recovering Lender) is discharged by payment, set-off or any other manner other
than through the Facility Agent under this Agreement (a recovery), then:

 

  (a) the recovering Lender must, within three Business Days, supply details of
the recovery to the Facility Agent;

 

  (b) the Facility Agent must calculate whether the recovery is in excess of the
amount which the recovering Lender would have received if the recovery had been
received by the Facility Agent under this Agreement; and

 

  (c) the recovering Lender must pay to the Facility Agent an amount equal to
the excess (the redistribution).

 

28.2 Effect of redistribution

 

(a) The Facility Agent must treat redistribution as if it were a payment by the
Company under this Agreement and distribute it among the Lenders accordingly.

 

(b) When the Facility Agent makes a distribution under paragraph (a) above, the
recovering Lender will be subrogated to the rights of the Finance Parties which
have shared in that redistribution.

 

(c) If and to the extent that the recovering Lender is not able to rely on any
rights of subrogation under paragraph (b) above, the Company will owe the
recovering Lender a debt which is equal to the redistribution, immediately
payable and of the type originally discharged.

 

     If:

 

  (i) a recovering Lender must subsequently return a recovery, or an amount
measured by reference to a recovery, to the Company; and

 

46

--------------------------------------------------------------------------------

  (ii) the recovering Lender has paid redistribution in relation to that
recovery,

 

     each Finance Party must reimburse the recovering Lender all or the
appropriate portion of the redistribution paid to that Finance Party, together
with interest for the period while it held the re-distribution. In this event,
the subrogation in paragraph (b) above will operate in reverse to the extent of
the reimbursement.

 

28.3 Exceptions

 

     Notwithstanding any other term of this Clause, a recovering Lender need not
pay redistribution to the extent that:

 

  (a) it would not, after the payment, have a valid claim against the Company in
the amount of the redistribution; or

 

  (b) it would be sharing with another Finance Party any amount that the
recovering Lender has received or recovered as a result of legal or arbitration
proceedings, where:

 

  (i) the recovering Lender notified the Facility Agent of those proceedings;
and

 

  (ii) the other Finance Party had an opportunity to participate in those
proceedings but did not do so or did not take separate legal or arbitration
proceedings as soon as reasonably practicable after receiving notice of them.

 

29. SEVERABILITY

 

     If a term of a Finance Document is or becomes illegal, invalid or
unenforceable in any jurisdiction, that shall not affect:

 

  (a) the validity or enforceability in that jurisdiction of any other term of
the Finance Documents; or

 

  (b) the validity or enforceability in other jurisdictions of that or any other
term of the Finance Documents.

 

30. COUNTERPARTS

 

     Each Finance Document may be executed in any number of counterparts. This
has the same effect as if the signatures on the counterparts were on a single
copy of the Finance Document.

 

31. NOTICES

 

31.1 Giving of notices

 

     All notices or other communications under or in connection with this
Agreement shall be given in writing and, unless otherwise stated, may be made by
letter or facsimile. Any such notice will be deemed to be given as follows:

 

  (a) if by letter, when delivered personally or on actual receipt; and

 

  (b) if by facsimile, when received in legible form.

 

     However, a notice given in accordance with the above but received on a
non-working day or after business hours in the place of receipt will only be
deemed to be given on the next working day in that place.

 

47

--------------------------------------------------------------------------------

31.2 Addresses for notices

 

(a) The address and facsimile number of the Company are:

 

     U. S. Steel Košice, s.r.o.

     Vstupný areál U. S. Steel

     04454 Košice,

     The Slovak Republic

     Attention:         Chief Financial Officer

     Fax:                  421-95-673-0858

 

     and copied to:

 

     United States Steel Corporation

     600 Grant Street

     Pittsburgh, PA 15219

     Attention:         Assistant Treasurer - Finance & Risk Management

     Fax:                  001 412 433 4756

 

     or such other as the Company may notify to the Facility Agent by not less
than five Business Days’ notice.

 

(b) The address and facsimile number of the Facility Agent are:

 

     ING Bank N.V.

     60 London Wall

     London EC2M 5TQ

     United Kingdom

 

     Attention:               Daniel Kerry / Craig Baker

     Tel number:           + 44 207 767 5616 / 5617

 

     Fax number:           + 44 207 767 7324

 

     E-mail:                   daniel.kerry@uk.ing.com / craig.baker@uk.ing.com

 

     or such other as the Facility Agent may notify to the other Parties by not
less than five Business Days’ notice.

 

31.3 The Company

 

     All formal communication under the Finance Documents to or from the Company
must be sent through the Facility Agent.

 

32. LANGUAGE

 

(a) Any notice given in connection with a Finance Document must be in English.

 

(b) Any other document provided in connection with a Finance Document must be:

 

  (i) in English; or

 

48

--------------------------------------------------------------------------------

  (ii) (unless the Facility Agent and the Company otherwise agree) accompanied
by a certified English translation. In this case, the English translation
prevails unless the document is a statutory or other official document.

 

33. WAIVER OF IMMUNITY

 

     The Company irrevocably and unconditionally:

 

  (a) agrees that if a Finance Party brings proceedings against it or its assets
in relation to a Finance Document, no immunity from those proceedings
(including, without limitation, suit, attachment prior to judgement, other
attachment, the obtaining of judgement, execution or other enforcement) will be
claimed by or on behalf of itself or with respect to its assets;

 

  (b) waives any such right of immunity which it or its assets now has or may
subsequently acquire; and

 

  (c) consents generally in respect of any such proceedings to the giving of any
relief or the issue of any process in connection with those proceedings,
including, without limitation, the making, enforcement or execution against any
assets whatsoever (irrespective of its use or intended use) of any order or
judgement which may be made or given in those proceedings.

 

34. GOVERNING LAW

 

     This Agreement is governed by English law.

 

35. ENFORCEMENT

 

35.1 Submission

 

  (a) For the benefit of the Finance Parties, the Company agrees that the courts
of England have jurisdiction to settle any disputes in connection with any
Finance Document and accordingly submits to the jurisdiction of the English
courts.

 

  (b) To the extent allowed by law, the Finance Parties may take:

 

  (i) proceedings in any other court; and

 

  (ii) concurrent proceedings in any number of jurisdictions.

 

35.2 Service of process

 

     Without prejudice to any other mode of service, the Company:

 

  (a) irrevocably appoints The London Law Agency Limited 69 Southampton Row,
London WC1B 4ET, England as its agent for service of process in relation to any
proceedings before the English courts in connection with any Finance Document;

 

  (b) agrees to maintain such an agent for service of process in England for so
long as any amount is outstanding under this Agreement;

 

  (c) agrees that failure by the process agent to notify the Company of the
process will not invalidate the proceedings concerned;

 

49

--------------------------------------------------------------------------------

  (d) consents to the service of process relating to any such proceedings by
prepaid posting of a copy of the process to its address for the time being
applying under Clause 31.2 (Addresses for notices); and

 

  (e) agrees that if the appointment of any person mentioned in paragraph (a)
above ceases to be effective, the Company shall immediately appoint a further
person in England to accept service of process on its behalf in England and,
failing such appointment within 15 days, the Facility Agent is entitled to
appoint such a person by notice to the Company.

 

35.3 Forum convenience and enforcement abroad

 

     The Company:

 

  (a) waives objection to the English courts on grounds of inconvenient forum or
otherwise as regards proceedings in connection with a Finance Document; and

 

  (b) agrees that a judgement or order of an English court in connection with a
Finance Document is conclusive and binding on it and may be enforced against it
in the courts of any other jurisdiction.

 

35.4 Non-exclusivity

 

     Nothing in this Clause 35 limits the right of a Finance Party to bring
proceedings against the Company in connection with any Finance Document:

 

  (a) in any other court of competent jurisdiction; or

 

  (b) concurrently in more than one jurisdiction.

 

35.5 Arbitration

 

     Notwithstanding the foregoing, the Parties agree that, if the Facility
Agent and the Company so require, any dispute arising out of or in connection
with this Agreement (including any question regarding its existence, validity or
termination) shall be referred to and finally resolved by arbitration under the
Rules of the London Court of International Arbitration (the Rules) which Rules
are deemed to be incorporated by reference into this Clause 35.5. The Tribunal
shall consist of a sole arbitrator agreed upon by the Company and the Facility
Agent in writing (subject to the Rules) or, if not so agreed within 21 days of
the Facility Agent and the Company requiring the dispute to be referred to
arbitration, a sole arbitrator appointed in accordance with the Rules. The place
of any such arbitration shall be London and the language English.

 

35.6 Waiver of trial by jury

 

     EACH PARTY WAIVES ANY RIGHT IT MAY HAVE TO A JURY TRIAL OF ANY CLAIM OR
CAUSE OF ACTION IN CONNECTION WITH ANY FINANCE DOCUMENT OR ANY TRANSACTION
CONTEMPLATED BY ANY FINANCE DOCUMENT. THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO TRIAL BY COURT.

 

This Agreement has been entered into on the date stated at the beginning of this
Agreement.

 

50

--------------------------------------------------------------------------------

SCHEDULE 1

 

ORIGINAL PARTIES

 

PART 1

 

ORIGINAL LENDERS

 

Name of Original

--------------------------------------------------------------------------------

   Lender Commitments

--------------------------------------------------------------------------------

Citibank, N.A. Bahrain

P.O.Box 548

Manama

Kingdom of Bahrain

   € 65,000,000

ING BANK N.V., pobočka zahraničnej banky

Jesenského 4/C

814 99 Bratislava

Slovakia

   € 65,000,000

Slovenská sporitel’ňa, a.s.

Suché mýto 4

816 07 Bratislava

   € 65,000,000     

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

Total Commitments

   € 195,000,000     

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

 

51

--------------------------------------------------------------------------------

SCHEDULE 2

 

FORM OF REQUEST

 

To:    ING BANK N.V. as Facility Agent From:    [                    ] Date:   
[            ], 2005

 

U. S. Steel Košice, s.r.o.

 

€195,000,000 Facility Agreement

dated [    ] December, 2005 (the Agreement)

 

1. We refer to the Agreement. This is a Request.

 

2. We wish to borrow a Loan on the following terms:

 

  (a) Utilisation Date: [        ], 200[    ]

 

  (b) Amount/currency: [                            ]

 

  (c) Term: [                            ].

 

3. Our [payment/delivery] instructions are:
[                                    ].

 

4. We confirm that each condition precedent under the Agreement that must be
satisfied on the date of this Request is so satisfied.

 

5. This Request is irrevocable.

 

By:

[            ]

 

52

--------------------------------------------------------------------------------

SCHEDULE 3

 

FORM OF TRANSFER CERTIFICATE

 

To:    ING BANK N.V. as Facility Agent From:    [THE EXISTING LENDER] (the
Existing Lender) and [THE NEW LENDER] (the New Lender) Date:    [        ],
200[  ]

 

U. S. Steel Košice, s.r.o.

 

€195,000,000 Facility Agreement

dated [    ] December, 2005 (the Agreement)

 

We refer to the Agreement. This is a Transfer Certificate.

 

1. The Existing Lender transfers by novation to the New Lender the Existing
Lender’s rights and obligations referred to in the Schedule below in accordance
with the terms of the Agreement.

 

2. The proposed Transfer Date is [        ], 200[    ].

 

3. The administrative details of the New Lender for the purposes of the
Agreement are set out in the Schedule.

 

4. This Transfer Certificate is governed by English law.

 

THE SCHEDULE

 

Rights and obligations to be transferred by novation

[insert relevant details, including applicable Commitment (or part)]

 

Administrative details of the New Lender

[insert details of Facility Office, address for notices and payment details
etc.]

 

[EXISTING LENDER]       [NEW LENDER] By:           By:    

 

The Transfer Date is confirmed by the Facility Agent as [        ], 200[  ]1.

 

ING BANK N.V. By:     Accepted: U. S. Steel Košice, s.r.o. By:  

 

--------------------------------------------------------------------------------

By:  

 

--------------------------------------------------------------------------------

 

53

--------------------------------------------------------------------------------

SCHEDULE 4

 

CONDITIONS PRECEDENT DOCUMENTS

 

1. A copy of the constitutional documents of the Company.

 

2. A specimen of the signature of each person authorised to sign this Agreement
on behalf of the Company and to sign and/or despatch all documents and notices
to be signed and/or despatched by the Company under or in connection with this
Agreement.

 

3. Evidence that the process agent referred to in Clause 35.2 (Service of
process) has accepted its appointment under that Clause.

 

4. An extract from the Company’s entry in the Commercial Registry,
sealed/stamped by the Košice Commercial Registry, as at a date no earlier than
one week prior to the date of the Agreement and certified by an Authorised
Signatory of the Company, as at a date no earlier than the date of this
Agreement, confirming the accuracy of all facts shown in the extract, except
with respect to the attached amendments which have been filed with the
Commercial Registry.

 

5. A copy of any other authorisation or other document, opinion or assurance
which the Facility Agent, acting reasonably, considers to be necessary or
desirable in connection with the entry into and performance of, and the
transactions contemplated by, any Finance Document or for the validity and
enforceability of any Finance Document.

 

6. Audited consolidated financial statements of the Company for the year ended
31 December 2004 and the unaudited consolidated financial statements of the
Company for the semi annual period ended 30 June 2005 certified by the chief
financial officer (or equivalent) of the Company.

 

7. A certificate of an authorised signatory of United States Steel Corporation
certifying that the Company is a 100% owned Subsidiary of United States Steel
Corporation.

 

8. A certificate of an authorised signatory of the Company certifying that each
copy document delivered under this Schedule 4 is correct, complete and in full
force and effect as at a date no earlier than the date of this Agreement.

 

9.        

(a)      A legal opinion of a legal adviser in the Republic, substantially in
the form of Schedule 5, addressed to the Facility Agent;

 

  (b) a legal opinion of Allen & Overy, legal advisers to the Lenders in the
Republic, substantially in the form of Schedule 6, addressed to the Facility
Agent; and

 

  (c) a legal opinion of Allen & Overy, legal advisers in England to the
Lenders, substantially in the form of Schedule 7, addressed to the Facility
Agent.

 

54

--------------------------------------------------------------------------------

SCHEDULE 5

 

FORM OF LEGAL OPINION OF LEGAL ADVISER TO THE COMPANY

 

[date]                                

 

ING BANK N.V.

[            ]

 

Dear Sirs,

 

U. S. Steel Košice, s.r.o. (the Company) €195,000,000

Facility Agreement dated [ ] December, 2005 (the Agreement)

 

I am an Assistant General Counsel of the Company and am authorized to practice
law in the Slovak Republic.

 

Terms defined in the Agreement and not defined otherwise herein shall have the
same meanings when used herein as therein.

 

I have examined originals or copies of such corporate records of the Company,
governmental authorisations or orders, certificates of public officials and of
representatives of the Company and other documents, as I have deemed relevant
and necessary as the basis of, and have made all due and necessary enquiries for
the purpose of giving, my opinion.

 

In giving this opinion I have also examined:

 

1. an executed copy of the Agreement;

 

2. the following corporate documents of the Company:

 

  (a) extract of the Company Register of the District Court Košice 1, Section
Sro, No. 11711/V of [ th] [ ], 2005 in respect of the Company;

 

  (b) a copy of the foundation agreement of the Company dated 7th June, 2000;
and

 

  (c) a copy of the Memorandum of Association of the Company in full writing
dated 28 November 2005.

 

In giving this opinion I have assumed:

 

(a) that the Agreement has been duly authorised, executed and delivered by or on
behalf of each of the parties thereto other than the Company; and

 

(b) that the Agreement constitutes a legal, valid, binding and enforceable
obligation of the Company in accordance with its terms under English law, and is
binding on the Parties.

 

This opinion is limited to the substantive laws of the Slovak Republic currently
in force and I have made no investigation and no opinion is expressed or implied
as to the laws of any other jurisdiction. I express no opinion as to matters of
fact. This opinion is given subject to matters not disclosed to me and about
which I have no knowledge. I assume that there are no facts that would affect
the conclusions in this opinion.

 

55

--------------------------------------------------------------------------------

Based on the foregoing and subject to the assumptions set out above and the
qualifications set out below, I am of the opinion that, so far as the laws of
the Slovak Republic are concerned at the date of this opinion:

 

1. Status. The Company is a limited liability company organised under the laws
of the Slovak Republic.

 

2. Powers and authority. The Company has the corporate power and authority to
enter into and perform the obligations expressed to be assumed by it under the
Agreement and to borrow thereunder and, subject to a duly passed resolution of
the executives of the Company approving the terms of, and the transactions
contemplated by the Agreement and authorising the relevant members of the
Company’s statutory body to execute the Agreement on behalf of the Company, has
taken all necessary corporate action to authorise the execution of the Agreement
and the borrowing of the Loans. According to Section 13(4) and 133(3) of the
Slovak Commercial Code (Act No. 513/1991 Coll., as amended), any restriction of
the authority of a company’s statutory body to act for the company shall be
ineffective vis-à-vis third parties (any disclosure of that restriction
notwithstanding).

 

3. Execution. The Agreement has been duly executed and delivered by the Company.

 

4. Legal validity. The Agreement constitutes a legal, valid, binding and
enforceable obligation of the Company in accordance with its terms and (subject
to the preparation of the official translation into the Slovak language) is in
the proper form for its enforcement in the courts of the Slovak Republic.

 

5. Non-conflict. The execution by the Company of the Agreement does not, and its
performance of that agreement will not, violate: (i) any mandatory provision of
any Slovak law or regulation or the Constitution of the Slovak Republic; (ii)
the constitutional documents of the Company referred to in paragraph 2(a) to (c)
above; or (iii) any other agreement, document or obligation which is binding
upon the Company or any of its Assets.

 

6. Consents. No authorisations, approvals, consents, licences, exemptions,
filings, registrations, notarisations or other requirements of governmental,
judicial or public bodies and authorities of the Slovak Republic are required in
connection with the Company’s entry into or performance of the Agreement, or for
its validity or enforceability against the Company.

 

7. Signatories. [    ] and [    ] have the right and power to execute the
Agreement and to give any notices to the Facility Agent thereunder.

 

8. Pari passu ranking. The obligations of the Company under the Agreement rank
at least pari passu with all its other present or future unsecured and
unsubordinated obligations, save as provided under mandatory provisions of
Slovak law.

 

9. Borrowing limits. The borrowing of the full amount available under the
Agreement will not cause any limit on the Company’s borrowing or other powers or
on the exercise of such powers by its board of directors, whether imposed by the
Company’s Articles of Association or similar document or by statute, regulation,
or agreement, to be exceeded.

 

10. Stamp duties. Except for court fees and sworn translators’ fees payable in
connection with proceedings to enforce the Agreement and for any applicable
notarial charges, there are no stamp, transfer or registration fees or similar
taxes, charges or duties payable in the Slovak Republic in connection with the
execution or enforcement of the Agreement.

 

56

--------------------------------------------------------------------------------

11. No immunity.

 

  (a) The Company is subject to civil and commercial law with respect to its
obligations under the Agreement, and its entry into and performance of the
Agreement constitutes private and commercial acts;

 

  (b) neither the Company nor any of its assets located in the Slovak Republic
enjoys any right of immunity from suit, attachment prior to judgement or other
legal process in respect of its obligations under the Agreement.

 

12. Bankruptcy. The Company has not been declared bankrupt and no step has been
or is being taken by the Company nor am I aware of any other step being taken in
respect of the Company, for bankruptcy or any similar proceedings in relation to
the Company or any of its Assets.

 

13. Application of governing law. The choice of English law as the governing law
of the Agreement would be upheld as a valid choice of law by the courts of the
Slovak Republic.

 

14. Submission to jurisdiction. The submission by the Company to the
jurisdiction of the English courts and arbitration under Clause 35 of the
Agreement is a valid and binding submission to jurisdiction in respect of the
Agreement and not subject to revocation.

 

15. Enforcement of foreign judgements/arbitration awards.

 

  A judgement duly obtained in the English courts shall be recognised and
enforced in the Slovak Republic unless:

 

  (a) the matter is one within the exclusive competence of the courts of the
Slovak Republic pursuant to its laws, or is one beyond the competence of any
judicial proceedings of a foreign authority, as determined by the laws of the
Slovak Republic; or

 

  (b) the decision is not final or enforceable in the state where it has been
issued; or

 

  (c) the decision is not a decision on the merits of the matter; or

 

  (d) the party against whom such judgement is sought to be enforced has been
deprived of an opportunity to participate in the foreign proceedings, especially
if the summons or notice of the commencement of the foreign proceedings has not
been duly served on the party; this exception does not apply if the party has
not filed an appeal against the foreign judgement which has been duly served on
it or if the party has waived the applicability of this exception; or

 

  (e) a final decision in the same matter has previously been reached by a court
of the Slovak Republic or by a foreign authority if that foreign authority’s
decision has been, or would be, enforced in the Slovak Republic; or

 

  (f) recognition of the foreign judgement would be contrary to public policy
(ordre public) of the Slovak Republic.

 

  Subject to compliance with, and on the assumption that none of the grounds for
refusal to enforce an arbitral award as set out in, the New York Convention on
the Recognition and Enforcement of Foreign Arbitral Awards dated 10th June, 1958
(the Convention) are applicable, an arbitral award obtained against the Company
in arbitration proceedings based on or in connection with the Agreement, in
accordance with the relevant clauses thereof, will be enforced in the Slovak
Republic in accordance with the provisions of the Convention, provided that a
Slovak court has the jurisdiction.

 

57

--------------------------------------------------------------------------------

16. Foreign currency judgements/arbitration awards. A judgement duly obtained in
the courts of England or an arbitral award in respect of the Agreement given in
euros or United States Dollars, and being enforced in the Slovak Republic in
euros or United States Dollars respectively, would be implemented in euros or
United States Dollars respectively.

 

The qualifications to which this opinion is subject are as follows:

 

1. The validity, enforceability and effectiveness of the Agreement against the
Company are limited by all bankruptcy, insolvency, moratorium and other laws
affecting creditors’ rights generally.

 

2. References in this opinion to the term “enforceable” mean that each
obligation or document is of a type and form which the Slovak courts would
enforce. It is not certain, however, that each obligation or document will be
enforced in accordance with its terms in every circumstance, enforcement being
subject to inter alia the nature of the remedies available in the Slovak courts,
the acceptance by such courts of jurisdiction, the power of such courts to stay
proceedings, the provisions of other principles of law of general application
(such as e.g. the concept of fair business conduct) and all limitations
resulting from the laws of bankruptcy, insolvency, liquidation, forced
administration, any statutes of limitation and lapse of time or other laws
affecting generally the enforcement of creditors’ rights.

 

3. Any subsidies or other funds obtained by the Company from the state budget or
from the budget of European Communities or any assets purchased from funds
originated from the state budget are immune from attachment and from execution
and would not be available to creditors in any enforcement proceedings.

 

4. Under the Foreign Exchange Act No. 202/1995 Coll., as amended, if a foreign
exchange emergency is declared by the Government of the Slovak Republic,
payments in foreign currency or abroad generally may be suspended for the
duration of such emergency (not to exceed three months at any one time).

 

5. The effectiveness of terms exculpating a party from a liability or duty
otherwise owed is limited by law.

 

6. Slovak courts may not give effect to any indemnity for legal costs incurred
by a litigant in proceedings before Slovak courts.

 

This opinion expresses Slovak legal concepts in English. Such concepts are not
always capable of precise expression in English without the extensive
comparative law analysis which would not be appropriate for an opinion of this
kind.

 

This opinion is given exclusively in connection with the Agreement and for no
other purpose. It is strictly limited to the matters set forth herein and no
opinion may be inferred or implied beyond that expressly stated herein.

 

This opinion is given solely to the Finance Parties that are the original
parties to the Agreement and may not be given to or relied upon, by any other
person.

 

Yours faithfully, [            ]

 

Assistant General Counsel

 

58

--------------------------------------------------------------------------------

SCHEDULE 6

 

FORM OF LEGAL OPINION OF ALLEN & OVERY – SLOVAK LAW

 

[Allen & Overy Letterhead]

 

[date]                                

 

ING BANK N.V.

[             ]

 

Dear Sirs,

 

U. S. Steel Košice, s.r.o. (the Company) €195,000,000

Facility Agreement dated [    ] December, 2005 (the Agreement)

 

I have acted as legal advisor in the Slovak Republic to the Original Lenders as
to the laws of the Slovak Republic in connection with the Agreement between the
Company, the Arrangers, the Facility Agent and the Financial Institutions listed
in the Agreement.

 

Terms defined in the Agreement and not defined otherwise herein shall have the
same meanings when used herein as therein.

 

DOCUMENTS

 

For the purposes of this opinion, I have examined the following documents:

 

1. an executed copy of the Agreement;

 

2. the following corporate documents of the Company, certified by an authorised
signatory for and on behalf of the Company as being true, correct and complete
as at a date no earlier than the date of the Agreement:

 

  (a) an extract of the Company Register of the District Court Košice 1, Section
Sro, No. 11711/V of [ th] [    ], 2005 in respect of the Company;

 

  (b) a copy of the foundation agreement of the Company dated 7th June, 2000;
and

 

  (c) a copy of the Memorandum of Association of the Company in full writing
dated 28 November 2005.

 

I have not examined any other document entered into by or affecting the Company
or any corporate or other records of the Company and have not made any other
inquiries concerning it.

 

ASSUMPTIONS

 

In giving this opinion I have assumed:

 

(a) that the Parties (other than the Company) have taken all necessary actions
(including corporate action) to authorise the entry into and performance of the
Agreement and that the Agreement has been duly authorised, executed and
delivered by or on behalf of the Parties (other than the Company) in accordance
with all applicable laws and their respective constitutional documents;

 

59

--------------------------------------------------------------------------------

(b) the genuineness of all signatures on all documents, the authenticity and
completeness of all documents submitted to me as originals and the completeness
and conformity to the original documents of all documents submitted to me as
copies;

 

(c) that the documents referred to in paragraph 2 above were at their date, and
remain, accurate and are in full force and effect;

 

(d) that the Agreement, and the transactions contemplated thereby, constitutes a
legal, valid, binding and enforceable obligation of the Parties (including the
Company) in accordance with its terms under English law, and is binding on the
Parties;

 

(e) that the Parties (other than the Company) have the requisite power, capacity
and authority to enter into and perform the Agreement;

 

(f) that the authorisation, execution, delivery and performance of the Agreement
will not contravene any of the provisions of the constitutional documents of any
Party (other than the Company);

 

(g) that no provision of the laws of any jurisdiction other than the Slovak
Republic affects the conclusions of the opinion (e.g. insofar as any obligation
is to be performed in any jurisdiction outside the Slovak Republic, its
performance will not be illegal or ineffective by virtue of the law of, or
contrary to public policy in, that jurisdiction); and

 

(h) that no petition has been filed to declare bankruptcy with respect to the
Company over its assets.

 

This opinion is limited to the law of the Slovak Republic currently in force and
I have made no investigation and no opinion is expressed or implied as to the
laws of any other jurisdiction. I express no opinion on any EU Directives not
implemented in the Slovak domestic law. I express no opinion as to matters of
fact. This opinion is given subject to matters not disclosed to me and about
which I have no knowledge. I assume that there are no matters of fact that would
affect the conclusions in this opinion.

 

I have not advised as to matters of taxation law and practice.

 

OPINION

 

Based on the foregoing and subject to the assumptions set out above and the
qualifications set out below, I am of the opinion that, so far as the laws of
the Slovak Republic are concerned at the date of this opinion:

 

1. Status. The Company is a limited liability company organised under the laws
of the Slovak Republic.

 

2. Powers and authority. The Company has the corporate power to enter into and
perform the obligations expressed to be assumed by it under the Agreement and to
borrow under the Agreement and, subject to a duly passed resolution of the
executives of the Company approving the terms of, and the transactions
contemplated by the Agreement and authorising the relevant members of the
Company’s statutory body to execute the Agreement on behalf of the Company, has
taken all necessary corporate action to authorise the execution of the Agreement
and the borrowing of the Loans. According to Section 13(4) and 133(3) of the
Slovak Commercial Code (Act No. 513/1991 Coll., as amended), any restriction of
the authority of a company’s statutory body to act for the company shall be
ineffective vis-à-vis third parties (any disclosure of that restriction
notwithstanding).

 

60

--------------------------------------------------------------------------------

3. Legal validity. The Agreement constitutes a legal, valid, binding and
enforceable obligation of the Company in accordance with its terms and (subject
to the preparation of the official translation into the Slovak language) is in
the proper form for its enforcement in the courts of the Slovak Republic.

 

4. Non-conflict. The execution by the Company of the Agreement does not, and its
performance of that agreement will not, violate: (i) any mandatory provision of
any Slovak law or regulation or the Constitution of the Slovak Republic; or
(ii) the constitutional documents of the Company referred to in paragraphs 2(a)
to (c) above.

 

5. Consents. No authorisations, approvals, consents, licences, exemptions,
filings, registrations, notarisations or other requirements of governmental,
judicial or public bodies and authorities of the Slovak Republic are required in
connection with the Company’s entry into or performance of the Agreement, or for
its validity or enforceability against the Company.

 

6. No immunity.

 

  (a) The Company is subject to civil and commercial law with respect to its
obligations under the Agreement, and its entry into and performance of the
Agreement constitutes private and commercial acts.

 

  (b) Neither the Company nor any of its assets located in the Slovak Republic
enjoys any right of immunity from suit, attachment prior to judgement or other
legal process in respect of its obligations under the Agreement.

 

7. Stamp duties. Except for court fees and sworn translators’ fees payable in
connection with proceedings to enforce the Agreement and for any applicable
notarial charges, there are no stamp, transfer or registration fees or similar
taxes, charges or duties payable in the Slovak Republic in connection with the
execution or enforcement of the Agreement.

 

8. Governing law. The choice of English law as the governing law of the
Agreement would be upheld as a valid choice of law by the courts of the Slovak
Republic.

 

9. Enforcement of foreign judgments/arbitration awards. A judgement duly
obtained in the English courts shall be recognised and enforced in the Slovak
Republic unless:

 

  (a) the matter is one within the exclusive competence of the courts of the
Slovak Republic pursuant to its laws, or is one beyond the competence of any
judicial proceedings of a foreign authority, as determined by the laws of the
Slovak Republic; or

 

  (b) the decision is not final or enforceable in the state where it has been
issued; or

 

  (c) the decision is not a decision on the merits of the matter; or

 

  (d) the party against whom such judgement is sought to be enforced has been
deprived of an opportunity to participate in the foreign proceedings, especially
if the summons or notice of the commencement of the foreign proceedings has not
been duly served on the party; this exception does not apply if the party has
not filed an appeal against the foreign judgement which has been duly served on
it or if the party has waived the applicability of this exception; or

 

  (e) a final decision in the same matter has previously been reached by a court
of the Slovak Republic or by a foreign authority if that foreign authority’s
decision has been, or would be, enforced in the Slovak Republic; or

 

61

--------------------------------------------------------------------------------

  (f) recognition of the foreign judgement would be contrary to public policy
(ordre public) of the Slovak Republic.

 

10. Subject to compliance with, and on the assumption that none of the grounds
for refusal to enforce an arbitral award as set out in, the New York Convention
on the Recognition and Enforcement of Foreign Arbitral Awards dated 10th June,
1958 (the Convention) are applicable, an arbitral award obtained against the
Company in arbitration proceedings based on or in connection with the Agreement,
in accordance with the relevant clauses thereof, will be enforced in the Slovak
Republic in accordance with the provisions of the Convention, provided that a
Slovak court has the jurisdiction.

 

11. Foreign currency judgements/arbitration awards. A judgement duly obtained in
the courts of England or an arbitral award in respect of the Agreement given in
euros or United States Dollars, and being enforced in the Slovak Republic in
euros or United States Dollars respectively, would be implemented in euros or
United States Dollars respectively.

 

12. Submission to jurisdiction. The submission by the Company to the
jurisdiction of English courts or, as the case may be, consent to arbitration in
accordance with the Rules of the London Court of International Arbitration, will
be recognised as a valid and binding submission to jurisdiction and consent to
arbitration in respect of the Agreement.

 

QUALIFICATIONS

 

The qualifications to which this opinion is subject are as follows:

 

(a) The validity, enforceability and effectiveness of the Agreement against the
Company are limited by all bankruptcy, insolvency, moratorium and other laws
affecting creditors’ rights generally.

 

(b) References in this opinion to the term “enforceable” mean that each
obligation or document is of a type and form which the Slovak courts would
enforce. It is not certain, however, that each obligation or document will be
enforced in accordance with its terms in every circumstance, enforcement being
subject to inter alia the nature of the remedies available in the Slovak courts,
the acceptance by such courts of jurisdiction, the power of such courts to stay
proceedings, the provisions of other principles of law of general application
(such as e.g. the concept of fair business conduct) and all limitations
resulting from the laws of bankruptcy, insolvency, liquidation, forced
administration, any statutes of limitation and lapse of time or other laws
affecting generally the enforcement of creditors’ rights.

 

(c) Any subsidies or other funds obtained by the Company from the state budget
or from the budget of European Communities or any assets purchased from funds
originated from the state budget are immune from attachment and from execution
and would not be available to creditors in any enforcement proceedings.

 

(d) Under the Foreign Exchange Act No. 202/1995 Coll., as amended, if a foreign
exchange emergency is declared by the Government of the Slovak Republic,
payments in foreign currency or abroad generally may be suspended for the
duration of such emergency (not to exceed three months at any one time).

 

(e) The effectiveness of terms exculpating a party from a liability or duty
otherwise owed is limited by law.

 

(f) Slovak courts may not give effect to any indemnity for legal costs incurred
by a litigant in proceedings before Slovak courts.

 

62

--------------------------------------------------------------------------------

GENERAL

 

This opinion expresses Slovak legal concepts in English. Such concepts are not
always capable of precise expression in English without the extensive
comparative law analysis which would not be appropriate for an opinion of this
kind.

 

This opinion is given exclusively in connection with the Agreement and for no
other purpose. It is strictly limited to the matters set forth herein and no
opinion may be inferred or implied beyond that expressly stated herein. It is
also given on the basis that we have no obligation to notify any addressee of
this opinion of any change in Slovak law or its application after the date of
this opinion.

 

This opinion is given solely to the Original Lenders and may not be given to or
relied upon by any other person. You may not give copies of this opinion to
others without our prior written permission.

 

Yours faithfully,

 

Igor Pálka

Advocate

Allen & Overy Bratislava, s.r.o.

 

63

--------------------------------------------------------------------------------

SCHEDULE 7

 

FORM OF LEGAL OPINION OF ALLEN & OVERY – ENGLISH LAW

 

[Allen & Overy Letterhead]

 

[date]                                         

 

ING BANK N.V.

[            ]

 

Dear Sirs,

 

U. S. Steel Košice, s.r.o. (the Company) €195,000,000

Facility Agreement dated [    ] December, 2005 (the Agreement)

 

We have acted as English legal advisers to ING Bank N.V. as Facility Agent in
connection with the Agreement between the Company, the Arrangers, the Facility
Agent and the Financial Institutions listed in the Agreement.

 

Terms defined in the Agreement and not defined otherwise herein shall have the
same meanings when used herein as therein.

 

We have examined an executed copy of the Agreement and the opinion of Allen &
Overy Bratislava, s.r.o. referred to in Schedule 4 (Conditions Precedent
Documents) to the Agreement.

 

We have not examined any other document entered into by or affecting the Company
or any corporate or other records of the Company and have not made any other
inquiries concerning it.

 

In giving this opinion we have assumed:

 

(a) that the Agreement has been duly authorised, executed and delivered by or on
behalf of each of the parties thereto;

 

(b) the genuineness of all signatures on all documents, the authenticity and
completeness of all documents submitted to us as originals, and the completeness
and conformity to the original documents of all documents submitted to us as
copies;

 

(c) that the Agreement constitutes a legal, valid, binding and enforceable
obligation of the Company in accordance with its terms under Slovak law, and is
binding on the Parties and in this regard we have relied on the opinion of
Allen & Overy Bratislava, s.r.o. referred to above; and

 

(d) in relation to any arbitration in connection with this Agreement, the
arbitrator will, in making any determination, have regard to the facts and
circumstances of any matter in dispute in a manner consistent with that of any
English court.

 

This opinion is limited to the substantive laws of England & Wales currently in
force and we have made no investigation and no opinion is expressed or implied
as to the laws of any other jurisdiction. We express no opinion as to matters of
fact. This opinion is given subject to matters not disclosed to use and about
which we have no knowledge. We assume that there are no facts that would affect
the conclusions in this opinion.

 

64

--------------------------------------------------------------------------------

Based on the foregoing and subject to the assumptions set out above and the
qualifications set out below, we are of the opinion that, so far as the laws of
England & Wales are concerned at the date of this opinion:

 

1. Legal validity: The Agreement constitutes a legal, valid and binding
obligation of the Company enforceable against the Company, except that the
enforceability of such obligations may be limited by (i) bankruptcy, insolvency,
reorganisation, moratorium or other similar laws affecting creditors’ rights
generally and (ii) general principles of law including, without limitation,
concepts of materiality, reasonableness, good faith and fair dealing.

 

2. Legality and contraventions: The execution and delivery by the Company of the
Agreement and the assumption or performance of its obligations thereunder, do
not and will not violate in any respect any provision of any applicable English
law or regulation.

 

3. Consents and Registration Requirements: No authorisation, approval, consent,
licence, exemption, registration or filing of or with any governmental, public
or regulatory authority or agency in England is necessary in relation to the
execution and delivery by the Company of the Agreement, or the assumption or
performance of obligations thereunder.

 

4. Stamp Duty: No ad valorem stamp duties, registration fees or other similar
duties, taxes or charges are payable in England in respect of the execution or
delivery of the Agreement.

 

5. Arbitration and Jurisdiction

 

  (a) The submission by the Company to the jurisdiction of the English courts
or, as the case may be, (conditional) consent to arbitration in accordance with
the Rules of the London Court of International Arbitration, will be recognised
as a valid submission to jurisdiction and (conditional) consent to arbitration
in respect of the Agreement.

 

  (b) An award made pursuant to arbitration conducted in accordance with the
requirements of the arbitration clause in the Agreement would be enforceable in
the Courts of England pursuant to, and subject to, the exceptions and provisions
of the Arbitration Act 1996.

 

  (c) The choice of English law to govern the Agreement would be recognised and
upheld as a valid choice of law by the English courts or an arbitral tribunal
convened pursuant to the Agreement.

 

  (d) An arbitration award obtained in accordance with the Agreement will be
enforced in accordance with the 1958 New York Convention on the reciprocal
enforcement of arbitration awards.

 

The qualifications to which this opinion is subject are as follows:

 

(a) As used in this opinion, the term enforceable means that the obligations
assumed by the relevant party under the relevant document are of a type and form
enforced by the courts in England. The term does not address the extent to which
a judgement or arbitration award will be enforceable outside England. Nor is it
certain that each obligation will necessarily be capable of enforcement in
England in accordance with its terms in every circumstance, such enforcement
being, in any event, subject to rules governing the enforceability of
arbitration awards, the nature of the remedies available in the courts in
England and other principles of law, equity and procedure of general
application.

 

(b) This opinion is subject to all limitations resulting from the laws of
bankruptcy, insolvency, liquidation and other laws of general application
relating to or affecting the rights of creditors.

 

65

--------------------------------------------------------------------------------

(c) Any provision in the Agreement for interest to be paid on overdue amounts at
a rate in excess of the pre-default rate may amount to a penalty under English
law and may therefore not be recoverable.

 

(d) Under certain circumstances, a court or arbitral tribunal in England may not
treat as conclusive those certificates, judgements, determinations, records and
opinions which the Agreement states are to be so treated (for example without
limitation, if a certificate, judgement, determination, record or opinion could
be shown to have been in manifest error or to have an unreasonable or arbitrary
basis or not to have been made in good faith).

 

(e) The effectiveness of terms exculpating a party from a liability or duty
otherwise owed is limited by law.

 

(f) A court or arbitral tribunal in England will not necessarily give full
effect to an indemnity for the costs of litigation or enforcement incurred by an
unsuccessful litigant.

 

(g) The Agreement may under English law be amended orally by the parties thereto
notwithstanding provisions therein to the contrary.

 

(h) Failure or delay in exercising any right may constitute a waiver of that
right in spite of provisions to the contrary in the Agreement, for example, in
circumstances where such failure amounts to an implied representation that the
right has been waived and it is reasonable in the circumstances for the Company
to rely on this representation.

 

(i) Any obligations requiring an indemnity in respect of stamp duties may be
void in respect of stamp duty payable in the United Kingdom.

 

(j) A court or arbitrator in England may allow set-off or counterclaim in
circumstances in which it is fair and equitable to do so.

 

(k) [Where legal proceedings are brought in respect of a matter which the
Parties have agreed to arbitrate under Clause 35.5, the English courts may grant
a stay of those legal proceedings unless satisfied that the arbitration
agreement is null and void, inoperative or incapable of being performed.]

 

(l) The enforceability of the Agreement will be subject to the limitations set
out in our Slovak law legal opinion of even date.

 

This opinion is given exclusively in connection with the Agreement and for no
other purpose. It is strictly limited to the matters set forth herein and no
opinion may be inferred or implied beyond that expressly stated herein.

 

This opinion is given solely to the Original Lenders and may not be given to or
relied upon by any other person.

 

Yours faithfully,

 

 

[    ]

 

66

--------------------------------------------------------------------------------

SIGNATORIES

 

Company U. S. STEEL KOŠICE, s.r.o. By:   

/s/ JAMES F. CONNOR

--------------------------------------------------------------------------------

     Executive By:   

/s/ KENNETH R. PEPPERNEY

--------------------------------------------------------------------------------

     Executive Arrangers CITIBANK, N.A. Bahrain By:   

/s/ IGOR KOTTMAN

--------------------------------------------------------------------------------

     Under a power of attorney By:   

/s/ JÚLIA LACHKÁ

--------------------------------------------------------------------------------

     Under a power of attorney ING BANK N.V., pobočka zahraničnej banky By:   

/s/ HANS VAN ESSEN

--------------------------------------------------------------------------------

     General Manager By:   

/s/ JAROSLAV VITTEK

--------------------------------------------------------------------------------

     Director Wholesale Products SLOVENSKÁ SPORITEL’ŇA, a.s. By:   

/s/ BENEDIKT VON KEMPIS

--------------------------------------------------------------------------------

     Director of Corporate Banking Division By:   

/s/ ZLATA SMOLKOVÁ

--------------------------------------------------------------------------------

     Head of Corporate Clients Department Facility Agent ING BANK N.V. By:   

/s/ EDWARD BAILEY

--------------------------------------------------------------------------------

     Analyst, under a Power of Attorney

 

67

--------------------------------------------------------------------------------

Original Lenders CITIBANK, N.A. Bahrain By:   

/s/ JÚLIA LACHKÁ

--------------------------------------------------------------------------------

     Under a power of attorney By:   

/s/ IGOR KOTTMAN

--------------------------------------------------------------------------------

     Under a power of attorney ING BANK N.V., pobočka zahraničnej banky By:   

/s/ HANS VAN ESSEN

--------------------------------------------------------------------------------

     General Manager By:   

/s/ JAROSLAV VITTEK

--------------------------------------------------------------------------------

     Director Wholesale Products SLOVENSKÁ SPORITEL’ŇA, a.s. By:   

/s/ BENEDIKT VON KEMPIS

--------------------------------------------------------------------------------

     Director of Corporate Banking Division By:   

/s/ ZLATA SMOLKOVÁ

--------------------------------------------------------------------------------

     Head of Corporate Clients Department

 

68