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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
 FORM 10-K þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
 For the fiscal year
ended December 31, 2004
OR o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the transition period from________ to________ Commission File Number 000-50300 WHEELING-PITTSBURGH CORPORATION  DELAWARE
    
    55-0309927(State of Incorporation)1134 Market Street, Wheeling, WV
    
    (I.R.S. Employer Identification No.)26003(Address of principal executive offices)
    
    (Zip code)
 Registrants telephone number, including area code: (304) 234-2400 Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section 12(g) of the Act: Common Stock, $0.01 per value per share
(Title of Class) Rights to Purchase Series A Junior Participating Preferred Stock
(Title of Class) Indicate by check mark whether the registrant (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes þ No o Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation
S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of
registrants knowledge, in definitive proxy or information statements incorporated by reference in
Part III of this Form 10-K or any amendment to this Form 10-K. o Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule
12b-2 of the Exchange Act). Yes þ No o The aggregate market value of the outstanding common stock, other than shares held by persons who
may be deemed affiliates of the registrant, as of June 30 (the last business day of the
registrants most recently completed second fiscal quarter) was approximately $116 million. Shares
of common stock held by the United Steelworkers of America Voluntary Employee Benefits Association
and by executive officers and directors of
the registrant are not included in the computation. However, the registrant has made no
determination that such persons are affiliates within the meaning of Rule 405 under the
Securities Act of 1933. Applicable only to registrants involved in bankruptcy proceedings during the preceding five years: Indicate by check mark whether the registrant has filed all documents and reports required to
be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court. Yes þ No o The registrant had 14,434,715 shares of its common stock, par value $0.01 per share, issued
and outstanding as of February 28, 2005. Documents Incorporated by Reference: None




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TABLE OF CONTENTS PAGEPART I.Item 1. Business
    
    
    2Item 2. Properties
    
    
    19Item 3. Legal Proceedings
    
    
    20Item 4. Submission of Matters to a Vote of Security Holders
    
    
    21PART II.Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
    
    
    22Item 6. Selected Financial Data
    
    
    23Item 7. Managements Discussion and Analysis of Financial Condition and Results of
Operation
    
    
    25Item 7A. Quantitative and Qualitative Disclosures about Market Risks
    
    
    40Item 8. Financial Statements and Supplementary Data
    
    
    41Item 9. Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure
    
    
    79Item 9A. Controls and Procedures
    
    
    79Item 9B. Other Information
    
    
    79PART III.Item 10. Directors and Executives Officers of the Registrant
    
    
    80Item 11. Executive Compensation
    
    
    85Item 12. Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
    
    
    89Item 13. Certain Relationships and Related Transactions
    
    
    91Item 14. Principal Accountant Fees and Services
    
    
    92PART IV.Item 15. Exhibits and Financial Statement Schedules
    
    
    93Signatures
    
    
    96EXHIBIT 3.1(A)EXHIBIT 3.1 (B)EXHIBIT 10.13 (A)EXHIBIT 10.13 (B)EXHIBIT 10.13 (C)EXHIBIT 10.13 (D)EXHIBIT 10.13 (E)EXHIBIT 10.13 (F)EXHIBIT 10.13 (G)EXHIBIT 10.13 (H)EXHIBIT 10.17EXHIBIT 10.18EXHIBIT 10.19EXHIBIT 23.1EXHIBIT 31.1EXHIBIT 31.2EXHIBIT 32.1EXHIBIT 32.2




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PART I 
 Item 1. BUSINESS Overview
Wheeling-Pittsburgh Corporation (WPC) is a Delaware holding company that, together with its several
subsidiaries and joint ventures, produces steel and steel products using both integrated and
electric arc furnace technology. WPC sold 2.1 million tons of steel and steel products in 2004.
Our principal operating subsidiary is Wheeling-Pittsburgh Steel Corporation (WPSC), a Delaware
corporation, whose headquarters is located in Wheeling, West Virginia. WPC was organized as a
Delaware corporation on June 27, 1920 under the name Wheeling Steel Corporation. Our product offerings are focused predominantly on higher value-added finished steel products such
as cold rolled products, tin and zinc coated products and fabricated products. Higher value-added
products comprised more than 69% of our shipments in 2004. In addition, we produce semi-finished
steel products and hot rolled steel products. We market a mix of products to a wide range of
customers and end markets including the construction, container, and appliance industries, and to
steel service centers, converters and processors. Wheeling Corrugating Company (WCC), an operating division of WPSC, manufactures our fabricated
steel products including construction and bridge decking, corrugated roofing and siding, and
painted coil for the construction, agricultural and highway industries. WCC products represented
19.2% of our steel tonnage shipped in 2004. WPSC also has ownership interests in two joint
ventures, Wheeling-Nisshin, Inc. (Wheeling -Nisshin) and Ohio Coatings Company (OCC), which
consumed 30.7% of our steel tonnage shipped in 2004, representing 26.2% of our 2004 net sales.
These joint ventures produce value-added steel products including aluminized and galvanized sheet,
and tin coated products for the container, construction and service center markets. Prior to August 1, 2003, Wheeling-Pittsburgh Corporation (WPC) was a wholly-owned subsidiary of WHX
Corporation. On November 16, 2000, WPC and its then-existing wholly-owned subsidiaries filed
voluntary petitions for relief under Chapter 11 of the US Bankruptcy Code, and emerged from
bankruptcy on August 1, 2003. For a detailed discussion of the reorganization, refer to Note 2 to
the Consolidated Financial Statements included in Item 8. Financial Statements and Supplementary
Data. Recent Developments
On September 21, 2004, we completed a public stock offering of 3,719,898 shares of our common stock
at an offering price of $29 per share. Net proceeds from the sale of $99.7 million were used to
repay all amounts outstanding under our revolving credit agreement and to fund a restricted cash
account for future capital expenditures. In November 2004, we completed construction of our electric arc furnace (EAF) with the EAF
producing its first heat on November 28, 2004. The EAF achieved 50% capacity with a cold metallic
charge in the second full month of operations. The EAF is expected to be operating at 75% of
capacity by May 2005 and at full capacity by the fourth quarter of 2005. Steel production from the
EAF, along with the idling of one of our two blast furnaces, will transform our operations from an
integrated producer to a hybrid producer of steel with characteristics of both an integrated
producer and a mini-mill. This transformation will provide flexibility in our steel making process
by enabling us to use the EAF on its own or in conjunction with our remaining blast furnace and
basic oxygen furnace (BOF). The EAF has a continuous scrap feed, or Consteel®, and is
differentiated from most mini-mills in that it has the ability to receive liquid iron as an
alternative metallic input to more conventional steel scrap charged materials, enabling us to
optimize our raw material input costs. Consteel® is the process of continuously feeding
and pre-heating the metallic scrap charge to the EAF. The EAF will also reduce our requirements for
coke as a raw material input. In June 2004, we entered into a long-term scrap supply agreement
designed to provide us with an adequate and reliable source of scrap for our EAF operations. The
EAF has several additional advantages over integrated steel production including lower capital
expenditures for construction of facilities, a more variable cost structure and limited ongoing
capital requirements to sustain operations. We expect to be able to maintain existing quality
levels across our full range of products while using the EAF in our steel making process. We
believe that the EAF has an annual production capacity of up to 2.5 million tons of liquid steel,
depending on the mix of hot metal and scrap 2




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inputs. The flexibility of using various operating configurations of the EAF and BOF to maximize
steel production is expected to enable us to produce 2.8 million tons of steel slabs annually and
manage our cost structure more efficiently. On December 23, 2004, WPSC entered into a Letter of Intent with Severstal North America, Inc.
Under the non-binding terms of the letter of intent, WPSC and Several North America, Inc. agreed to
form a Delaware limited liability company for the production of coke and coke related products. As
part of the proposed project, WPSC is expected to contribute its coke producing batteries, certain
related facilities and assets located at its facility in Follansbee, West Virginia and $20 million
to the limited liability company. Severstal North America, Inc. is expected to make cash
contributions in the amount of $140 million to the limited liability company over three years,
which would be used to substantially rebuild the coke batteries. After all contributions are
received, the limited liability company would be owned 50% by WPSC and 50% by Severstal North
America, Inc. Both parties would then be entitled to 50% of the coke produced by the facility. On February 14, 2005, we adopted a shareholder rights plan primarily intended to help protect our
tax net operating loss carryforwards. As part of the plan, we declared a dividend of one right for
each share of common stock held of record as of March 2, 2005, payable on March 2, 2005. The
rights may cause substantial dilution to a person or group that attempts to acquire 4.99% or
greater of our common stock on terms not approved by our Board of Directors. Acquisitions of our
common stock that would otherwise trigger the rights under the terms of the plan are permitted
where the entire Board of Directors has determined, prior to consummation, that the transaction is
fair to and in the best interests of our stockholders. In addition, the Board of Directors may
redeem the rights, at its discretion, at a redemption price of $.01 per right at any time until the
close of business on the earlier of (i) the 10th day following the first day of any public
announcement that a person has become an acquiring person under the terms of the rights plan or any
earlier date on which the Board of Directors becomes aware of the existence of an acquiring person,
or (ii) on the 10th business day after the date of commencement of a tender offer or exchange offer
the consummation of which would result in any person or group becoming an acquiring person. The
shareholder rights plan will expire on the earlier of the third anniversary date of the plan, or
the date, if any, on which the Company first discloses in any filing with the Securities and
Exchange Commission that the Companys net operating loss carryforwards no longer exceed $50
million. Business Strategy
Our business strategy is focused on making our cost structure more variable, reducing our ongoing
maintenance and capital expenditure requirements, providing flexibility to react to changing
economic conditions, and expanding our participation in markets for higher value-added products. Transition to electric arc furnace production
Our new EAF will transform our operations from conventional integrated steel production to those of
a hybrid steel producer with characteristics of both an integrated producer and a mini-mill. Our
EAF will be differentiated from most mini-mills by its ability to use both a continuous scrap feed
and liquid iron as an alternative metallic input. We expect that the EAF will have an annual
capacity of up to 2.5 million tons of liquid steel and, in conjunction with our BOF, will enable us
to produce 2.8 million tons of steel slabs annually, which is the practical steel making limit
under our current environmental permits. Construction and installation of the EAF was completed in
the fourth quarter of 2004, with the first heat occurring on November 28, 2004. The EAF achieved
50% capacity with a cold metallic charge in the second month of operations. The EAF is expected to
be operating at 75% of capacity by May 2005 and at full capacity by the fourth quarter of 2005.
After complete ramp-up of the EAF, we expect to idle one of our two blast furnace operations that
would otherwise require a major rebuild at an estimated cost of $140 million. Compared to integrated steel production, the EAF has several advantages including lower capital
expenditures for construction of facilities, a more variable cost structure, lower energy
requirements, and limited ongoing maintenance and capital expenditure requirements to sustain
operations. Further, the construction of the EAF with the simultaneous idling of one of our two
blast furnaces will significantly reduce our requirements for coke. The liquid iron that can be
used as a metallic input for the EAF will be produced using our remaining blast furnace operations,
providing us with additional flexibility relating to raw materials. We believe that the more
variable cost structure of the EAF and flexibility in raw material input utilization will enable
our costs to more closely track market conditions and will support our margins in market downturns. 3




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Strategic capital projects to improve productivity and cost position
We are planning a number of strategic capital projects over the next three years that are intended
to upgrade and eliminate bottlenecks in our rolling and finishing facilities and to increase our
productivity and improve our cost position. We plan to install new automatic roll changers on the
finishing mills at our hot strip mill in the fourth quarter of 2005 which are expected to expand
our annual rolling capacity by 0.4 million tons to 3.2 million tons and optimize throughput,
resulting in lower costs. In addition, we plan to upgrade our temper mill and install a final
inspection line at our Allenport facility. These and other improvements are intended to increase
our downstream capacity and improve the quality and market penetration of our value-added cold
rolled products. Capitalize on our anticipated excess coke capacity
We expect to have excess coke capacity following the ramp-up of our EAF and idling of one of our
two blast furnaces. In 2004, we produced 0.9 million tons of coke in our four coke batteries
meeting substantially all of our coke requirements. In 2005 and 2006, we expect to significantly
lower our annual coke requirements to approximately 0.7 and 0.6 million tons, respectively, from
approximately 1.0 million tons in 2004. To continue our self-sufficiency in coke and to capitalize
on favorable market conditions, a rebuild of our No. 8 coke battery located at our coke plant in
Follansbee, West Virginia is anticipated beginning in 2005. The construction is expected to be
completed in 2006 and is expected to require a capital investment of approximately $77.3 million.
The rebuild is expected to extend service life of the battery by 12-15 years. We expect to have
excess coke production capacity of approximately 0.3 million and 0.35 million tons in 2005 and
2006, respectively, after the idling of one of our two blast furnaces and excess capacity of
approximately 0.5 to 0.6 million tons of coke in 2007 after the rebuild of our No. 8 coke battery.
We are evaluating whether to rebuild our Nos. 1, 2 and 3 coke batteries and anticipate that this
rebuild would cost approximately $47.0 million and would start in 2008. If rebuilt, we anticipate
the annual production capacity of these batteries would increase from 0.38 million tons to 0.40
million tons, further bolstering our long coke position. We also expect to invest $26.1 million on
infrastructure and other capital items at our coke plant during the
years 2005 through 2009. On December 23, 2004, WPSC
entered into a Letter of Intent with Severstal North America, Inc.
Under the non-binding terms of the letter of intent, WPSC and Several
North America, Inc. agreed to form a Delaware limited liability
company for the production of coke and coke related products. As part
of the proposed project, WPSC is expected to contribute its coke
producing batteries, certain related facilities and assets located at
its facility in Follansbee, West Virginia and $20 million to the
limited liability company. Severstal North America, Inc. is expected
to make cash contributions in the amount of $140 million to the
limited liability company over three years, which would be used to
substantially rebuild the coke batteries. After all contributions are
received, the limited liability company would be owned 50% by WPSC and
50% by Severstal North America, Inc. Both parties would then be
entitled to 50% of the coke produced by the facility. Achieve balanced exposure to spot and contract business
We aim to achieve a balanced mix between spot and contract business. We believe that contract
business, which we define as agreements in excess of three months, offers insulation from the
volatility of the spot market. However, contract type business also could limit upside potential in
a tight market situation. A reasonable balance offers relatively predictable volumes, and an
opportunity to enhance product mix as well as to enjoy spot opportunities. Currently, our
relatively high exposure to the spot market, comprising 75% of our sales, is enabling us to benefit
from increased steel prices. In the long-term, we seek to increase our mix of contract business to
40% by targeting sales to end use customers versus spot sales to service centers and processors.
This mix is expected to provide enhanced stability in fluctuating market conditions and, at the
same time, should allow us to take advantage of positive pricing in tighter markets. We will
continue to target customers that purchase our products over prolonged periods of time and value
consistency of supply. Optimize the sale of downstream value-added products
We continue to seek a product mix that offers high returns and increases our stability. Our
long-term strategy focuses on higher value-added products with higher engineering content. Although
we are seeking to capitalize on current favorable pricing conditions in the commodity and hot
rolled markets to maximize our profitability, we will continue to identify products and markets
that offer higher returns and increase stability. We believe that our new operating configuration
will allow us to continue to produce a full range of products. We aim to increase our market
penetration of cold rolled products through capital expenditures and changes in operating practices
at our Allenport and Yorkville cold finishing mills, which are expected to result in higher quality
cold rolled products. These initiatives are expected to help to further penetrate the desirable OEM
marketplace and reduce reliance on service centers. 4




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Steel Industry
Steel making in the US is a highly competitive and capital-intensive industry with approximately
112 million tons of domestic shipments in 2004. Estimated domestic consumption was approximately
143 million tons in 2004 and is expected to increase to approximately 148 million tons in 2005.
Total annual steel consumption in the US has fluctuated between 143 million and 114 million tons
since 1994, and was approximately 143 million tons in 2004, 116 million tons in 2003 and 117
million tons in 2002. Imports of finished steel totaled approximately 28 million tons in 2004, 18
million tons in 2003 and 24 million tons in 2002. In the US, flat rolled steel is produced either by integrated steel facilities or mini-mills.
Integrated steel makers typically produce flat rolled products by using blast furnaces to combine
iron ore, limestone and coke (a refined carbon product derived from oven fired coal) into hot iron.
Scrap metal is then added to the hot iron to produce liquid steel through a BOF, which removes
impurities. After the liquid steel is metallurgically refined, it is processed through a continuous
caster to form slabs. These slabs are further shaped or rolled into flat sheets at a hot strip mill
or a plate mill. Various finishing processes may follow whereby the steel is treated through
pickling, cold-rolling, annealing, tempering or coating processes. The quality of steel products produced through the integrated process is generally more suitable
for a wider variety of high quality specialized uses than those produced through the mini-mill
process because less scrap containing impurities is used. As a result, integrated steel products
are typically used for more value-added applications. Integrated mills are also characterized by
more production steps and man-hours and higher costs of productive capacity and on-going
maintenance. Current restructuring efforts by integrated steel mills have focused on reducing these
costs through increased labor flexibility and efficiency, and using automation to increase labor
productivity. A mini-mill utilizes an electric arc furnace to melt scrap and scrap substitutes and remove
impurities, eliminating the need for iron ore and coke inputs. The liquid steel can be
metallurgically refined before it is cast into thin slabs which are further processed in line to
produce flat sheets similar to those produced by integrated steel makers. Similar finishing
processes often follow. The quality of mini-mill produced steel products is dependent on the limited quality of the scrap
raw materials used. However, in recent years, domestic mini-mills have increased the quality of
their steel products. Typically, mini-mills are more cost efficient than integrated producers
because they require less capital to operate and maintain. The correlation of scrap prices with
steel selling prices represents the main advantage of the mini-mill and EAF strategy. This
correlation has historically provided a relatively constant metal margin, or the difference between
the steel selling prices and scrap prices, to the mini-mills over the business cycle. This
relatively constant metal margin ensures that mini-mills perform better in downturns than
integrated producers. Industry Consolidation. In recent years, the fragmented US steel industry has experienced
volatile market conditions, characterized by declining prices, fluctuating capacity, low demand
growth and increased foreign imports. These conditions and additional constraints produced by
significant underfunded pension and retiree health care obligations have led to widespread
bankruptcies in the industry. Including us, over 40 companies have filed for Chapter 11 bankruptcy
protection since January 1998, including Bethlehem, LTV and National Steel (formerly the second,
third and fifth largest US integrated steel producers) in addition to Rouge Steel, Republic
Engineered Products and Weirton Steel. A number of these steel producers were purchased as a result
of bankruptcy, consolidation and rationalization of the industry. As a result of industry
consolidation, the top three Steel producers in the US held
approximately 46% of market share in 2004 compared to 44% in 2005. The US steel industry has recently experienced significant consolidation, which is expected to lead
to a more favorable pricing environment for US producers and has contributed to steel makers
recent ability to levy base rate price increases and raw material surcharges. Imports. As the single largest steel consuming country in the western world, the US market has
long been a focus of steel producers in Europe and Japan. Steel producers from Korea, Taiwan,
Brazil and other large economies such as Russia and China recognized the US as a target market. The
domestic steel market is affected by factors influencing worldwide supply and demand, with excess
production generally seeking the most lucrative markets. During the last several years, favorable
conditions in the US market resulted in significant imports of steel and substantially reduced
sales, margins and profitability of domestic steel producers. Imports surged in 1998 due to severe
economic conditions in Southeast Asia, Latin America, Japan and Russia, among others. Steel imports
of flat rolled products as a percentage of domestic apparent consumption, excluding semi-finished
steel, were 5




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approximately 21% in 1999, 22%% in 2000 and 20% in 2001 and 2002. Steel product prices reached historical cyclical lows in
December 2001 as a result of low domestic demand and increased foreign imports. As a result, the US government took various protective actions during 2001 and 2002, including the
enactment of various steel import quotas and tariffs under Section 201 of the US Trade Act of 1974,
as amended, which contributed to a decrease of some US steel imports during 2003. However, these
protective measures were only temporary and many foreign steel manufacturers were granted
exemptions from applications of these measures. Following a November 2003 decision by the World
Trade Organization Appellate Body declaring that the tariffs imposed by the US on steel imports
violated global trade rules, the steel import quotas and Section 201 tariffs were lifted in
December 2003. Import penetration fell to 16% for the full year 2003. The elimination of the
protections offered by these trade remedies may lead to increased competition from foreign
importers and could have an adverse effect on our business, financial condition or results of
operations. A weaker US dollar, increased demand for steel in China and other developing countries,
and higher raw material and ocean freight costs have discouraged imports and led to substantial
increases in steel selling prices. Recent actions to slow economic growth to sustainable levels by
banking authorities and other policy makers in China have created uncertainty regarding Chinas
ability to manage its rapid economic growth, which could adversely affect steel markets and the
steel industry. Steel imports of flat rolled products as a percentage of domestic apparent
consumption, excluding semi-finished steel, were approximately 27% in 2004. Pricing. Increased global demand, especially from mills in China, has put upward pressure on raw
material prices and scrap prices in particular. Between the fourth quarter of 2003 and December
2004, No. 1 Heavy Metal Scrap prices increased substantially. Shortages in coke have put pressure
on integrated steel producers with spot prices rising substantially during the year and remaining,
in certain cases, at more than $400 per ton in late 2004. Faced with higher raw material costs and increasing world demand, domestic steel producers began to
both increase base prices and implement raw material surcharges starting in January 2004. This
combination of factors has resulted in historically high prices for steel products. Segments and Geographic Area
We are engaged in one line of business and operate in one business segment, the making, processing
and fabricating of steel and steel products. We have a diverse customer base, substantially all of
which is located in the United States. All of the Companys operating assets are located in the
United States. Products and product mix
The table below reflects our product mix as a percentage of total tons shipped. Year EndedDecember
31,2004
    
    

2003
    
    

2002Product Category:Higher value added products as a percentage of total shipments:Cold-rolled
products  trade
    
    
    8.0
    %
    
    
    11.0
    %
    
    
    11.6
    %Cold-rolled
products  Wheeling-Nisshin
    
    
    19.3
    
    
    
    19.6
    
    
    
    20.0Coated products
    
    
    8.7
    
    
    
    4.9
    
    
    
    6.1Tin mill products
    
    
    13.6
    
    
    
    13.1
    
    
    
    13.0Fabricated products
    
    
    19.7
    
    
    
    21.8
    
    
    
    21.5Higher value-added products
    
    
    69.3
    
    
    
    70.4
    
    
    
    72.2Hot-rolled products
    
    
    30.7
    
    
    
    29.6
    
    
    
    26.4Semi-finished
    
    
    
    
    
    
    
    
    
    
    1.4Total
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Average net sales per ton
    
    $
    661
    
    
    $
    436
    
    
    $
    443
 Hot Rolled Products.Hot rolled coils represent the least processed of our finished goods.
Approximately 69.3% of our production of hot rolled coils during the year ended December 31, 2004
was further processed into value-added 6




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finished products. Hot rolled black or pickled (acid
cleaned) coils are sold to a variety of consumers such as converters and processors, steel service
centers and the appliance industry. Cold Rolled Products. Cold rolled coils are manufactured from hot rolled coils by employing a
variety of processing techniques, including pickling, cold reduction, annealing and temper rolling.
Cold rolled processing is designed to reduce the thickness and improve the shape, surface
characteristics and formability of the product. Coated Products.We manufacture a number of corrosion-resistant, zinc-coated products, including
hot-dipped galvanized sheets for resale to trade accounts. The coated products are manufactured
from a steel substrate of cold rolled or hot rolled pickled coils by applying zinc to the surface
of the material to enhance its corrosion protection. Our trade sales of galvanized products are
heavily oriented to unexposed applications, principally in the appliance, construction, service
center and automotive markets. Tin Mill Products.Tin mill products consist of blackplate and tinplate. Blackplate is a cold
rolled substrate (uncoated), the thickness of which is less than .0142 inches, and is utilized
extensively in the manufacture of pails and shelving and sold to OCC for the manufacture of
tinplate products. Tinplate is produced by the electro-deposition of tin to a blackplate substrate
and is utilized principally in the manufacture of food, beverage, general line and aerosol
containers. While the majority of our sales of these products are concentrated in container
markets, we also market products for automotive applications, such as oil filters and gaskets. We
produce all of our tin-coated products through OCC. OCCs tin coating mill has an annual capacity
of over 250,000 tons. Fabricated Products.Fabricated products consist of cold rolled or coated products further
processed mainly via sheeting and roll forming and are sold by the construction, agricultural and
specialty products groups. Construction Products.Construction products consist of roll-formed sheets, which are utilized in
sectors of the non-residential building market such as commercial, institutional and manufacturing.
They are classified into three basic categories: roof deck, form deck, and composite floor deck. Agricultural Products.Agricultural products consist of roll-formed corrugated sheets that are
used as roofing and siding in the construction of barns, farm machinery enclosures, light
commercial buildings and certain residential roofing applications. Specialty Products.Specialty products consist of coil and galvanized sheet steel supporting the
culvert and heating, ventilation and air conditioning markets. Specialty products are produced by
Wheeling-Nisshin and Feralloy-Wheeling Specialty Processing Co., of which we own a 49% equity
interest, and by contract service providers. Revenues from external customers by product line for the periods indicated below were as follows: Reorganized Company
    
    
    
    Predecessor Company(Dollars in thousands)Five Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    Ended
    
    
    Year EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002Product:Hot rolled
    
    $
    365,089
    
    
    
    85,305
    
    
    
    $
    106,545
    
    
    $
    179,530Cold rolled
    
    
    514,511
    
    
    
    143,925
    
    
    
    
    243,841
    
    
    
    387,384Galvanized
    
    
    132,178
    
    
    
    22,575
    
    
    
    
    26,446
    
    
    
    62,712Fabricated products
    
    
    375,090
    
    
    
    137,137
    
    
    
    
    179,083
    
    
    
    306,254Coke and coke by products
    
    
    9,074
    
    
    
    5,752
    
    
    
    
    9,155
    
    
    
    15,408Conversion and other (1)
    
    
    9,852
    
    
    
    2,208
    
    
    
    
    5,369
    
    
    
    28,705$
    1,405,794
    
    
    $
    396,902
    
    
    
    $
    570,439
    
    
    $
    979,993
   (1) Includes
conversion, semi-finished and resale products.
 7




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Customers and Markets
We market an extensive mix of products to a wide range of manufacturers, converters and processors.
Our 10 largest customers, including our Wheeling-Nisshin and OCC joint ventures, accounted for
approximately 43.3%, 42.5%, and 50.4% of our net sales, respectively, in each of the three years
ended December 31, 2004. Wheeling-Nisshin accounted for approximately 17.5%, 16.3% and 15.6% of our
net sales, respectively, in each of the three years ended December 31, 2004. OCC accounted for
approximately 8.6%, 11.2% and 10.6% of our net sales, respectively, in each of the three years
ended December 31, 2004. Geographically, the majority of our customers are located within a
350-mile radius of the Ohio Valley. However, we have taken advantage of our river-oriented
production facilities to market via barge into more distant locations such as the Houston, Texas
and St. Louis, Missouri areas. Shipments historically have been concentrated within seven major market segments: steel service
centers, converters and processors, construction, agriculture, container, automotive and
appliances. Our overall participation in the construction and the converters and processors markets
substantially exceeds the industry average and our reliance on automotive shipments, as a
percentage of total shipments, is substantially less than the industry average. The table set forth below reflects the percentage of total tons shipped to our market segments: Percentage of Total Tons ShippedYear EndedDecember 31,2004
    
    
    2003
    
    
    2002Steel service centers
    
    
    28
    %
    
    
    27
    %
    
    
    29
    %Converters and processors (1)
    
    
    29
    %
    
    
    28
    %
    
    
    27
    %Construction
    
    
    18
    %
    
    
    20
    %
    
    
    17
    %Agriculture
    
    
    5
    %
    
    
    3
    %
    
    
    6
    %Containers (1)
    
    
    16
    %
    
    
    16
    %
    
    
    15
    %Automotive
    
    
    1
    %
    
    
    1
    %
    
    
    1
    %Appliances
    
    
    1
    %
    
    
    1
    %
    
    
    2
    %Exports
    
    
    
    
    
    
    2
    %
    
    
    Other
    
    
    2
    %
    
    
    2
    %
    
    
    3
    %Total
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
   (1)
    Products shipped to Wheeling-Nisshin and OCC are included primarily in the converters
and processors and containers markets, respectively. Set forth below is a description of our major customer categories: Steel Service Centers.The shipments to steel service centers are heavily concentrated in the
areas of hot rolled and hot dipped galvanized coils. Due to increased internal costs to steel
companies during the 1980s for processing services such as slitting, shearing and blanking, steel
service centers have become a major factor in the distribution of hot rolled products to ultimate
end users. In addition, steel service centers have become a significant factor in the
sale of hot dipped galvanized products to a variety of small consumers such as mechanical
contractors, who desire not to be burdened with large steel inventories. Converters and Processors. Shipments to the converters and processors market are principally
shipments of cold rolled products to Wheeling-Nisshin, which uses cold rolled coils as a substrate
to manufacture a variety of coated products, including hot-dipped galvanized and aluminized coils
for the automotive, appliance and construction markets. The converters and processors industry also
represents a major outlet for our hot rolled products, which are converted into finished
commodities such as pipe, tubing and cold rolled strip. Construction.The shipments to the construction industry are heavily influenced by fabricated
product sales. We service the non-residential and agricultural building and highway industries,
principally through shipments of hot-dipped galvanized and painted cold rolled products. We have
been able to market our products into broad geographical areas due to our numerous regional
facilities. 8




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Agriculture.The shipments to the agricultural market are principally sales of roll-formed,
corrugated sheets, which are used as roofing and siding in the construction of barns, farm
machinery enclosures and light commercial buildings. Containers.The vast majority of shipments to the container market are concentrated in tin mill
products, which are utilized extensively in the manufacture of food, aerosol, beverage and general
line cans. The container industry has represented a stable market. The balance of shipments to this
market consists of cold rolled products for pails and drums. As a result of our OCC joint venture,
we phased out our existing tin mill production facilities but we continue to supply blackplate to
OCC for tin coating. Appliances.The shipments to the appliance market are concentrated in hot-dipped galvanized and
hot rolled coils. These products are furnished directly to appliance manufacturers as well as to
blanking, drawing and stamping companies that supply original equipment manufacturers. We have
concentrated on niche product applications primarily used in washer and dryer, refrigerator and
freezer and range appliances. Automotive.Unlike many of our competitors, we are not heavily dependent on shipments to the
automotive industry. However, we have been suppliers of tin mill products for automotive
applications, such as oil filters and gaskets. Joint Ventures
Wheeling-Nisshin
WPSC owns a 35.7% equity interest in Wheeling-Nisshin, which is a joint venture between Nisshin
Steel Co., Ltd. and WPSC. Wheeling-Nisshin owns a state-of-the-art processing facility located in
Follansbee, West Virginia which has capacity to produce over 700,000 tons annually of coated steel
and offers some of the lightest-gauge galvanized steel products manufactured in the US for
construction, heating, ventilation and air-conditioning and after-market automotive applications.
Wheeling-Nisshin products are marketed through trading companies, and its net sales are not
consolidated into our net sales. WPSC is a party to a supply agreement with Wheeling-Nisshin that expires in 2013. Wheeling-Nisshin
may terminate this agreement at any time WPSC and its subsidiaries and parent, if any, in the
aggregate own less than 20% of the common stock of Wheeling-Nisshin. Pursuant to that agreement,
WPSC is required to provide not less than 75% of Wheeling-Nisshins steel substrate requirements,
up to an aggregate maximum of 9,000 tons per week, subject to product quality requirements and at
negotiated prices based on prevailing actual market rates. Shipments of steel by WPSC to Wheeling-
Nisshin were approximately 413,000 tons, or 19.4% of our total tons shipped, approximately 440,000
tons, or 19.8% of our total tons shipped and approximately 445,000 tons, or 20.1% of our total tons
shipped, for the years ended December 31, 2004, 2003 and 2002, respectively. We derived
approximately 17.5%, 16.3% and 15.6% of our net sales from sales of steel to Wheeling-Nisshin in
2004, 2003 and 2002, respectively. For the years ended December 31, 2004, 2003 and 2002,
Wheeling-Nisshin had operating income of $42.5 million, $6.4 million and $6.9 million,
respectively, and we received dividends of $2.5 million in 2004 and 2003, respectively, and $1.25
million in 2002 from Wheeling-Nisshin. As of December 31, 2004, Wheeling-Nisshin had cash and
investment securities totaling $73.6 million and had no outstanding indebtedness. A shareholders agreement among WPSC and Nisshin Steel Co., Ltd. contains provisions that may
directly or indirectly restrict the transfer of the shares of Wheeling-Nisshin owned by WPSC,
including the following:  
    WPSC may not sell its Wheeling-Nisshin shares at any time that it is in breach of the
shareholders agreement or any other agreement with Wheeling-Nisshin, including the supply
agreement.
    If WPSC seeks to sell some or all of its Wheeling-Nisshin shares, it must first offer to
sell, transfer or assign the offered shares to the other Wheeling-Nisshin shareholder. In addition, WPSC has pledged its shares in Wheeling-Nisshin to the lenders under our term loan
agreement and revolving credit facility, and to the holders of our Series A notes and Series B
notes. Ohio Coatings Company
WPSC owns a 50% voting interest and an approximate 44% equity interest in OCC, which is a joint
venture among WPSC, Dong Yang Tinplate America Corp., a leading South Korea-based tin plate
producer, and Nippon Steel 9




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Trading America, Inc., formerly known as Nittetsu Shoji America, Inc., a
US-based tinplate importer. Dong Yang Tinplate America also holds a 50% voting interest and an
approximate 44% equity interest in OCC. Additionally, Nippon Steel Trading America holds nonvoting
preferred stock in OCC, which represents an approximate 11% equity interest in OCC and is subject
to repurchase by OCC. OCC commenced commercial operations in January 1997. The OCC tin-coating
facility is the only domestic electro-tin plating facility constructed in the past 30 years. The
tin coated products that we distribute are produced by OCC. Pursuant to a raw material supply agreement between WPSC and OCC, WPSC has the right to supply up
to 230,000 net tons in any calendar year of the black plate and cold rolled steel requirements of
OCC through 2012, subject to quality requirements and at negotiated prices based on prevailing
market rates. OCC may terminate this agreement if at any time WPSC owns less than 33% of the common
stock of OCC. Shipments of steel by WPSC to OCC were approximately 240,000 tons, or 11.3% of our
total tons shipped, approximately 239,000 tons, or 10.8% of our total tons shipped and
approximately 245,000 tons, or 11.1% of our total tons shipped, for the years ended December 31,
2004, 2003 and 2002, respectively. We derived approximately 8.6%, 11.2% and 10.8% of our net sales
from sales of steel to OCC in 2004, 2003 and 2002, respectively. Prior to July 2003, WPSC was the
exclusive distributor for all of OCCs products and marketed approximately 70% of OCCs products
through Nippon Steel Trading America. In July 2003, Nippon Steel Trading America became the
exclusive distributor for approximately 70% of OCCs products and WPSC remained a distributor for
the balance. In April 2004, OCC began selling to certain customers directly, which reduced WPSCs
distributorship to approximately 20% of OCCs products. WPSC does not expect to distribute any OCC
product in 2005. For the years ended December 31, 2004, 2003 and 2002, OCC had operating income of
$8.0 million, $9.6 million and $6.7 million, respectively. OCC did not pay any dividends during
those periods. At December 31, 2004, OCC had $32.8 million in outstanding indebtedness. A shareholders agreement among WPSC, Dong Yang Tinplate America, Nippon Steel Trading America and
OCC contains certain provisions that may restrict WPSCs ability to transfer its shares of OCC,
including the following:  
    Any pledge, transfer or other distribution of shares of OCC must be previously approved
by shareholders holding at least 66?% of the voting power of the common shares of OCC.
    For 45 days after a shareholder receives notice from the other party that a change of
control of the other party has occurred, the party receiving notice has the option to
purchase all, but not less than all, of the shares owned by the other party at a price
equal to $10,000 per share plus 10% interest or fair market value, whichever is higher. For
purposes of the shareholders agreement, change of control for WPSC means, the transfer
to persons (other than a holding company) of a majority of the capital stock of WPSC, or
any transfer of substantially all of its assets. WPSC has pledged its shares in OCC to the lenders under our term loan agreement and revolving
credit facility, and to the holders of our Series A notes and Series B notes. Pursuant to a loan agreement dated January 8, 1996, WPC loaned OCC $16.5 million. The loan has an
eight-year term and bore interest, as of December 31, 2004, at approximately 5.0% per annum. As of
December 31, 2004, OCC owed approximately $9.7 million on the loan. The loan is to be repaid in
November 2006. In April 2003, OCC entered into a three-year credit agreement with Bank of America, N.A., providing
for a revolving line of credit for loans and letters of credit in an amount of up to $18 million
and a term loan in the aggregate principal amount of $4.3 million. OCC is restricted from declaring
dividends under the terms of its credit agreement. However, OCC is permitted to make distributions
of interest and principal in respect of its indebtedness to WPC, subject to certain limitations set
forth in the credit agreement and in the subordination agreement described below. OCC has made
principal payments in each of the most recent three quarters. In connection with the refinancing,
WPC (i) entered into a subordination agreement, acknowledging
that the $11.7 million owed by OCC to WPC pursuant to the loan agreement described in the previous paragraph, is subordinate to any
indebtedness owed by OCC to Bank of America under OCCs term loan agreement; and (ii) WPSC entered
into a no-offset agreement, agreeing that it will not offset against accounts payable to OCC any
indebtedness of OCC to WPSC. 10




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##### Table of Contents



Competition
We believe that the main competitive factors in our market are:  
    quality;  
    reliability;
    product market price;
    product offerings;
    location and shipping costs; and
    raw material and operating costs. The steel industry is cyclical in nature and has been marked historically by overcapacity,
resulting in intense competition, which we expect to continue. Many
of our competitors are large, with the top three domestic
steel-producers holding approximately 46% of market share. We believe our major competitors
include the following:  
    domestic integrated steel producers, such as United States Steel Corporation,
International Steel Group Inc., AK Steel Corporation, Ispat Inland Inc. and Severstal N.A.;
    mini-mills, such as Nucor Corporation, Steel Dynamics Inc. and Gallatin Steel Company;
    converters and fabricators, such as The Techs, Winner Steel, Inc., United Steel Deck and
Metal Sales; and
    steel producers from Europe, Asia and other regions. Domestic integrated steel producers have lost market share in recent years to domestic mini-mill
producers. Mini-mills are generally smaller-volume steel producers that melt ferrous scrap metals,
their basic raw material, in electric furnaces. Although mini-mills generally produce a narrower
range of steel products than integrated producers, mini-mills, which rely on less capital-intensive
steel production methods, typically have certain advantages over integrated producers, such as
lower capital expenditures for construction of facilities, a more variable operating cost
structure, and limited ongoing capital needs to sustain operations. Additionally, since mini-mills
typically are not unionized, they have more flexible work rules that have resulted in lower
employment costs per net ton shipped. Since 1989, significant flat rolled mini-mill capacity has
been constructed and these mini-mills now compete with integrated producers in product areas that
traditionally have not faced significant competition from mini-mills. These mini-mills compete with
us primarily in the commodity flat rolled steel market. In addition, domestic mini-mills have
increased the quality of their steel products in recent years, which has provided a competitive
alternative to most of the steel products that we produce. In the long-term, mini-mills may also
compete with us in producing value-added products. We also face competition from domestic and foreign integrated producers. The increased competition
in commodity product markets influence integrated producers to increase product offerings to
compete with our custom products. Additionally, as the single largest steel consuming country in
the western world, the US has long been a focus of steel producers in Europe and Japan. Steel
producers from Korea, Taiwan, Brazil, and other large economies such as Russia and China have also
recognized the US as a target market. We also compete to some extent with producers of other materials that can be used in place of
steel. A number of steel substitutes, including plastics, aluminum, composites and glass, have
reduced the growth of domestic steel consumption. Sales and Marketing
Our sales and marketing functions are principally located in our Wheeling, West Virginia
headquarters. Sales are handled by customer service employees and sales personnel. We advertise and
promote our products and services at industry conventions and trade shows where we distribute
brochures promoting all of our product lines. Our sales force contacts existing and potential customers directly to promote our products and also
collects field intelligence for the marketing group. Our marketing department analyzes the needs of
our current customers and our product mix and identifies market opportunities. The marketing
department also determines pricing, product mix, lead times, and freight equalization, performs
order entry, and responds to requests for data from various trade organizations and governmental
agencies. Our customer service personnel respond to price quotation requests and accept incoming
orders from, and perform order entry and provide order status and shipping information to, our
customers. 11




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##### Table of Contents



Our sales force consists of two distinct sales groups: our steel division and WCC, our corrugating
division. Steel division products include, in ascending value order, hot rolled, cold rolled,
galvanized steel products and tin mill
products. Generally, there are improved margins within each category because selling prices
increase and cost absorption is enhanced as steel is processed from hot rolled to cold rolled to
galvanized. WCC is divided into three product groups, including construction products, agricultural
products and specialty products. WCCs product groups are generally higher value added than those
of our steel division. Manufacturing Process
With the ramp-up of our EAF, along with the idling of one of our two blast furnaces, we will
transform our operations from an integrated producer to a hybrid producer of steel with
characteristics of both an integrated producer and a mini-mill, producing liquid steel with both
our EAF and our BOF. Utilizing both electric energy and oxygen injection, the EAF melts recycled scrap and scrap
substitutes to produce liquid steel. In addition, the EAF will be able to use liquid iron as a
metallic input, which can be produced using our remaining blast furnace, providing us with
additional flexibility relating to raw materials. The continuous process also includes a reliable
scrap preheating system to reduce electric power requirements. We believe the higher portion of
variable costs of the EAF and flexibility in raw material input utilization will produce a cost
structure that more closely tracks market conditions and will support our margin in market
downturns. In our primary steel making process, iron ore pellets, coke, limestone and other raw materials are
consumed in the blast furnace to produce hot metal. Hot metal is further converted into liquid
steel through our BOF process where impurities are removed, recycled scrap is added and
metallurgical properties for end use are determined on a
batch-by-batch (heat) basis.
Heats of liquid steel are sent to the ladle metallurgy facility from both the EAF and BOF, where
the temperature and chemistry of the steel are adjusted to precise tolerances. Liquid steel from
the ladle metallurgy facility then is formed into slabs through the process of continuous casting.
After continuous casting, slabs are reheated, reduced and finished by extensive rolling, shaping,
tempering and, in certain cases, by the application of coatings at our downstream operations.
Finished products are normally shipped to customers in the form of coils or fabricated products. We
have linked our steel making and rolling equipment with a computer based manufacturing control
system to coordinate production tracking and status of customer orders. Raw Materials
In 2004, we entered into a long-term supply agreement for scrap based on prevailing market prices,
with an initial term expiring in April 2009. The agreement is designed to provide us with an
adequate and reliable source of scrap for our EAF operations. The scrap supply agreement does not
require us to make any minimum purchases and we believe that we have access to alternative supplies
of scrap, if necessary. Under the agreement, the supplier has constructed a scrap handling facility
to enable it to provide us with the scrap contemplated by the agreement. The introduction of our
EAF will increase our dependence on external scrap and scrap alternatives from approximately 22% of
our steel melt to approximately 62% of our steel melt in 2005. We have a long-term contract to purchase our iron ore requirements through March 2010. The iron ore
price is based upon prevailing world market prices, which have escalated significantly, less 3%. We
generally consume approximately 3 million gross tons of iron ore pellets in our blast furnaces
annually. The introduction of our EAF will decrease our dependence on iron ore. We have long-term supply agreements with third parties to provide us with a substantial portion of
our metallurgical coal requirements at specified contract prices,
which are subject to adjustment at stated times during the term of
the contracts.
Several of these suppliers have reduced required shipments to us claiming force majeure prohibited
shipments, which has led to depleted coal inventory levels,
substantially increased costs to purchase metallurgical coal from
alternative sources, and at times reduced production levels. Our coking operations require a substantial amount of metallurgical coal. We
currently produce substantially all of our coke requirements and burn the resultant by-product coke
oven gas in downstream operations instead of natural gas. In 2004, we consumed approximately 1.3
million tons of coking coal in our production of approximately 0.9 million tons of blast furnace
coke. Lower coal supplies caused us to reduce coke production in 2004, and required us from time
to time to purchase additional coke in the spot market at higher costs to enable us to meet our
coke requirements. Beginning in 2003 and continuing into 2004, coal, coke and scrap prices increased dramatically for
purchases in the spot market. We are passing these costs through to the customer when possible. 12




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Our operations require significant amounts of other raw materials, including limestone and natural
gas. These raw materials are readily available and are purchased on the open market. The cost of
these materials has been susceptible in the past to price fluctuations, but worldwide competition
in the steel industry has frequently limited the ability of steel producers to raise finished
product prices to recover higher material costs. However, the rapid economic expansion in China in
2003, among other factors, has affected the supply of steel in the US and allowed price increases
to offset higher raw material costs. Certain of our raw material supply contracts provide for price
adjustments in the event of increased commodity or energy prices. Natural gas prices have been
volatile in the past, having increased 1% in 2004 and 62% in 2003, while declining 25% in 2002. Energy
Many of our major facilities that use natural gas are equipped to use alternative fuels. During
2004, coal constituted approximately 65% of our total energy consumption, natural gas 30% and
electricity 5%. We continually monitor our operations regarding potential equipment conversion and
fuel substitution to reduce energy costs. Backlog
Our backlog was 347,211 tons at December 31, 2004, as compared to 482,514 tons at December 31,
2003. Most orders related to the backlog at December 31, 2004 are expected to be shipped during the
first quarter of 2005, subject to delays at customers request. The order backlog represents orders
received but not yet completed or shipped. In times of strong demand, a higher order backlog may
allow us to increase production runs, thereby enhancing production efficiencies. Employees
At December 31, 2004, we had 3,430 employees of whom 2,736 were represented by the USWA, 80 were
represented by other unions, 571 were salaried employees and the remaining 43 were non-union
operating employees. WPC, WPSC and the USWA negotiated a new labor agreement, which became
effective upon the date of reorganization and which expires on September 1, 2008. The labor
agreement includes, among other things, provisions regarding wages, health care and pension
benefits, profit sharing and employee security, and a retirement incentive program pursuant to
which 650 hourly personnel accepted early retirement incentives in August 2003. Cautionary Statement Concerning Forward-Looking Statements
This annual report on Form 10-K contains statements that are forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995 that may be identified by their use
of words like anticipates, believes, estimates, expects, intends, plans, projects,
targets, can, could, may, should, will, would or similar expressions and the
negative, thereof, and may contain projections or other statements regarding future events or our
future financial performance that involve risks and uncertainties. You are cautioned that these forward-looking statements are based on our current expectations and
projections about future events, and are subject to various risks and uncertainties, some of which
are beyond our control, that could cause actual results to differ materially from those projected
in these forward-looking statements. In light of the risks and uncertainties, there can be no
assurance that the forward-looking information will in fact prove to be accurate. We have
undertaken no obligation to publicly update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. Risk Factors
Our business, results of operations and financial condition may be materially and adversely
affected by any of the following risks. We recently emerged from a Chapter 11 bankruptcy reorganization and have in the past sustained
losses, and may not be able to maintain profitability.
Because we recently emerged from bankruptcy and have in the past sustained losses, we cannot assure
you that we will be able to maintain profitability in the future. We have sought protection under
Chapter 11 of the Bankruptcy Code twice since 1985, most recently in November 2000. We emerged
from our more recent Chapter 11 bankruptcy reorganization as a new reporting entity on August 1,
2003. Prior to and during this reorganization, we incurred substantial net losses. Although we
reported net income of $62.5 million for the year ended December 31, 2004, we incurred a net loss
of $38.9 million for the five months ended December 31, 2003 following our emergence from
bankruptcy. If we cannot maintain profitability, the value of our common stock may decline. 13




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You may not be able to compare our historical financial information to our current financial
information, which will make it more difficult to evaluate an investment in our company.
As a result of the completion of our reorganization plan, we are operating our business under a new
capital structure. In addition, we adopted fresh-start reporting in accordance with Statement of
Position, or SOP, 90-7, as of July 31, 2003. Because SOP 90-7 required us to account for our
assets and liabilities at their then current fair values, our financial condition and results of
operations after our reorganization are not comparable in some material respects to the financial
condition or results of operations reflected in our historical financial statements for periods
prior to August 1, 2003. This may make it difficult to assess our future prospects based on
historical performance. Intense competition in the steel industry and substitute materials could adversely affect our
profitability.
Competition within the steel industry, both domestic and worldwide, is intense and is expected to
remain so in the future. We compete with domestic steel producers, steel processors, mini-mills
and foreign importers. Mini-mills typically enjoy certain competitive advantages such as more
variable raw material costs that tend to rise and fall in tandem with steel selling prices,
non-unionized work forces with lower employment costs and more flexible work rules, and lower
ongoing maintenance and capital expenditure needs for construction and operation of their steel
making facilities. Additionally, the domestic mini-mills have increased the quality of their steel
products in recent years, which has provided a competitive alternative to most of the steel
products that we produce. Furthermore, many of our competitors have superior financial resources
or more favorable cost structures, and we may be at a competitive disadvantage in competing with
them. Moreover, steel products may be replaced to a certain extent by other substitute materials,
such as plastic, aluminum, graphite, composites, ceramics, glass, wood and concrete. Our
competitors may be successful in capturing our market share and we may be required to reduce
selling prices in order to compete with them. Increased imports could lower domestic steel prices and adversely affect our profitability.
We sell steel almost exclusively in the US market. The domestic steel market is affected by
factors influencing world-wide supply and demand, with excess production generally seeking the most
lucrative markets. During the last several years, favorable conditions in the US market compared
to the global markets resulted in significant imports of steel and substantially reduced sales,
margins and profitability of domestic steel producers, leading to imposition of import quotas and
tariffs under Section 201 of the US Trade Act of 1974, as amended. In recent months, the
convergence of the weakened US dollar, increased demand for steel and raw materials in China and
other developing countries, and higher raw material and ocean freight costs, have led to
substantial increases in steel selling prices, even though the Section 201 tariffs were lifted in
December 2003. However, import levels could increase thereby lowering the prices for our products
if the US dollar exchange rate improves or demand for foreign steel in China or certain other
developing countries decreases as a result of weakening economies or improved domestic steel
production in those countries. In addition, lower ocean freight costs and other factors may lead
to increased imports resulting in excess domestic steel capacity and lower prices for our products,
which could adversely affect our profitability. Because we are significantly leveraged, we may not be able to implement our business plan, service
our debt obligations or refinance our indebtedness.
We are significantly leveraged. Because we are significantly leveraged, it may be more difficult
for us to successfully implement our business plan. In addition, we may not be able to meet our
debt service obligations if we do not generate sufficient operating cash flow. As of December 31,
2004, our current assets totaled $362.3 million, including $156.7 million of inventory, and our
current liabilities totaled $217.1 million. As of December 31, 2004, our total indebtedness
was $333.6 million and total shareholders equity was $290.5 million. Based on our total
indebtedness as of December 31, 2004, we expect that our total debt service obligations (including
scheduled principal and interest payments) will be $54.5 million (assuming a blended interest rate
of 4.8% per annum) in 2005 and that our debt service obligations will
increase $1.1 million for the
12 months ending December 31, 2005 for each 1.0% increase in interest rates. We may not be able to
generate sufficient operating cash flow to pay interest and principal on all of our outstanding
debt as those payments become due. Our ability to meet our ongoing debt service obligations will depend on our ability to implement
our business plan, including the successful ramp-up and operation of our EAF, and a number of other
factors, including factors beyond our control. We may not be able to generate sufficient operating
cash flow to repay, when due, the principal amounts outstanding under our credit agreements at
final maturity, which may be as early as 2008 in the case of our 14




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term loan agreement and will be 2006 in the case of our revolving credit facility, or the other indebtedness described herein. We
expect that we will be required to refinance such amounts as they become due and payable; however,
we may not be able to consummate such refinancing to repay our obligations or to secure a refinancing on terms
satisfactory to us. If we are unable to refinance all or any significant portion of our
indebtedness, we may be required to sell assets or equity interests in our company. However, we may
not be able to sell assets or equity interests in an amount sufficient to repay our obligations or
on terms satisfactory to us. Our leverage, together with the restrictions that have been placed on
us under our credit agreements, may limit our ability to obtain additional financing and to take
advantage of business opportunities that may arise. In addition, this leverage increases our
vulnerability to adverse general economic and steel industry conditions. We may not be able to comply with our financial covenants, which may result in a default under the
credit agreements.
We are subject to certain financial covenants contained in our credit agreements, and we are
required to maintain borrowing availability under our asset-based revolving credit facility of at
least $25 million. As of December 31, 2004, our net excess
availability was $131.3 million, after
giving effect to required reserves, outstanding letters of credit and the $150 million maximum
availability limitation under the credit facility. For any quarterly period ending on or after March 31, 2005, our credit agreements require us to
maintain specified leverage, interest coverage and fixed charge coverage ratios. Our ability to
comply with these financial covenants will depend on our future performance, which may be subject
to prevailing economic conditions and other factors beyond our control. Our failure to comply with
these covenants would result in a default or an event of default, permitting the lenders to
accelerate the maturity of our indebtedness under the credit agreements and to foreclose upon any
collateral securing our indebtedness. Any default, event of default or acceleration would also
result in the acceleration of substantially all of our other indebtedness because certain documents
governing our other indebtedness contain cross-default or cross-acceleration provisions. Restrictive covenants in our debt instruments limit our flexibility and our ability to implement
our business plan.
Our credit agreements contain restrictive financial and operating covenants, including but not
limited to provisions that limit our ability to make capital expenditures, incur additional
indebtedness, create liens, make investments, sell assets and enter into transaction with
affiliates. For example, with respect to the completion of the EAF, the rebuild of our No. 8 coke
battery, the installation of an automatic roll changer system at our Mingo Junction facility, and
improvements to the Allenport cold mill, we are permitted only to incur capital expenditures up to
specified maximum amounts. In addition, we are subject to annual aggregate limitations ranging from
$33.9 million to $44 million on capital expenditures relating to any other capital projects,
including any potential rebuild of Nos. 1, 2 and 3 coke batteries. Our debt instruments may not provide us with sufficient flexibility to permit us to make all
necessary capital expenditures and take other measures that we believe are necessary to run our
business effectively and to achieve our business plan. If we are unable to make necessary capital
expenditures as a result of these covenants, our competitive position could be adversely affected. We may be unsuccessful in the ramp-up and transition of our electric arc furnace, which would
adversely affect our business prospects and competitive position in the industry.
Our business plan depends, in part, upon the successful ramp-up of our EAF and our transformation
from a conventional integrated steel producer to a hybrid steel producer with characteristics of
both an integrated producer and a mini-mill. Our inability to manage a successful transition of
our EAF could make it difficult to implement our long-term business strategy. In addition, electric arc furnaces occasionally experience quality control issues due to the large
percentage of scrap used. If we experience significant quality control problems, our competitive
position in the industry may be adversely affected. Any decrease in the availability, or increase in the cost, of raw materials and energy could
materially increase our costs and lower our earnings.
Our operations depend heavily on various raw materials and energy resources, including iron ore,
coal used in our coke production, scrap, electricity and certain gases. The availability of raw
materials and energy resources could 15




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decrease and their prices may be volatile as a result of,
among other things, changes in overall supply and demand levels and new laws or regulations. Any
disruption in the supply of our raw materials or energy resources may
impair, at least temporarily, our ability to manufacture some of our products, or require us to pay
higher prices in order to obtain these raw materials from other sources. In the event our raw
material and energy costs increase, we may not be able to pass these higher costs on to our
customers in full or at all. Any increases in the prices for raw materials or energy resources may
materially increase our costs and lower our earnings. Additionally, certain of our supply contracts are for fixed prices. Although we currently benefit
from some of these supply contracts because spot prices exceed contractually specified prices, if
market prices for these raw materials decline, we may not be able to take advantage of decreasing
market prices and our profit margins may be adversely affected. We also rely on a limited number of suppliers for a substantial portion of our raw material needs,
such as iron ore and metallurgical coal meeting our technical
specifications. Any failure of these suppliers to meet our needs for any reason could
have an adverse effect on our financial results and operating
performance. During both 2003 and 2004, we experienced
disruptions in the supply of coal from our two largest suppliers, which led to depleted coal
inventory levels, and substantially increased costs to purchase
metallurgical coal from alternative sources, which adversely
affected our operating results. Additional disruptions will cause us to purchase additional coal
on the spot market, which may increase our coal supply costs. Additionally, our suppliers may not
be able to supply our raw materials requirements in acceptable quantities, or at acceptable prices. We rely on a core group of significant customers for a substantial portion of our net sales, and a
reduction in demand, or inability to pay, from this group could adversely affect our total revenue.
Although we have a large number of customers, sales to our two largest customers, our
Wheeling-Nisshin and OCC joint ventures, accounted for approximately 26.1% of our net sales in
2004. Sales to our 10 largest customers, including to Wheeling-Nisshin and OCC, accounted for
43.9% of our net sales during the same period. We are likely to continue to depend upon a core
group of customers for a material percentage of our net sales in the future. Our significant
customers may not order steel products from us in the future or may reduce or delay the amount of
steel products ordered. Any reduction or delay in orders could negatively impact our revenues. If
one or more of our significant customers were to become insolvent or otherwise were unable to pay
us for the services provided, our results of operations would be adversely affected. The cyclical nature of the industries we serve may cause significant fluctuations in the demand for
our products and lead to periods of decreased demand.
Demand for most of our products is cyclical in nature and sensitive to general economic conditions.
Our business supports cyclical industries such as the appliance and construction industries. In
addition, approximately 75% of our sales are made on the basis of purchase orders rather than
long-term agreements, which we define as contracts exceeding three months. As a result, downturns
in the US or global economies or in any of the industries we support could adversely affect the
demand for and selling prices of steel, which could have an adverse affect on our results of
operations and cash flows. We may not be able to sustain our level of total revenue or rate of
revenue growth, if any, on a quarterly or annual basis. It is likely that, in some future quarters,
our operating results may fall below our targets and the expectations of stock market analysts and
investors. In such event, the price of our common stock could decline significantly. We may not be able to implement our business plan because we may be unable to fund the substantial
on-going capital and maintenance expenditures that our operations require.
Our operations are capital intensive. We require capital for, among other purposes, acquiring new
equipment, maintaining the condition of our existing equipment and maintaining compliance with
environmental laws and regulations. Our business plan provides that capital expenditures for the
three-year period ending December 31, 2007 will aggregate approximately $267.3 million. This
amount includes $1.9 million remaining for completion of the EAF; $77.3 million for a rebuild of
the No. 8 coke battery, which is targeted for completion in late 2006; $14.5 million for
installation of hot strip mill automatic roll changers at our Mingo Junction facility, expected to
occur in 2005; and $9.8 million for cold mill improvements at our Allenport facility, expected to
occur in 2005 and 2006, but does not include an aggregate $47 million that we believe would be
needed in 2008 and 2009 if we decide to rebuild the Nos. 1, 2 and 3 coke batteries. 16




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We may not be able to fund our capital expenditures from operating cash flow and from the proceeds
of borrowings available for capital expenditures under the credit agreements, although our business
plan assumes we will. If we are unable to fund our capital requirements, we may be unable to
implement our business plan. A significant interruption or casualty loss at any of our facilities could increase our production
costs and reduce our sales and earnings.
Our steel making facilities may experience interruptions or major accidents and may be subject to
unplanned events such as explosions, fires, inclement weather, acts of God, terrorism, accidents
and transportation interruptions. Any shutdown or interruption of a facility would reduce the
production from that facility, which would substantially impair our business. Interruptions in
production capabilities will inevitably increase production costs and reduce our sales and
earnings. In addition to the revenue losses, longer term business disruption could result in a
loss of customers. To the extent these events are not covered by insurance, our cash flows may be
adversely impacted by events of this type. In December 2004, our steel-making operations were adversely affected by an incident involving the
collapse of ductwork at our BOF facility. Production from the BOF was curtailed for 12 days
following the incident resulting in the loss of approximately 10,000 tons of shipments in the
fourth quarter of 2004, and anticipated further losses of 85,000 tons of shipments in the first
quarter of 2005. Our quarterly net sales, operating results and profitability may vary from quarter to quarter,
which may lead to volatility in the trading price of our stock.
Our quarterly net sales, operating results and profitability have varied in the past and are likely
to vary significantly from quarter to quarter in the future. This may lead to volatility in our
share price. Factors that are likely to cause these variations include but are not limited to:
volatility in spot market prices for our steel products or raw materials and energy costs; global
economic conditions; variations in the maintenance needs for our facilities and steel making
operations; unanticipated changes in our labor relations; and seasonal aspects impacting demand for
our steel products. Our production costs may increase and we may not be able to sustain our sales and earnings if we
fail to maintain satisfactory labor relations.
The majority of our hourly employees are covered by a collective bargaining agreement with the USWA
that expires on September 1, 2008. Of our total employees, approximately 81.6% are unionized,
including 79.3% of whom are members of the USWA. Any potential strikes or work stoppages in the
future, and the resulting adverse impact on our relationships with our customers, could have a
material adverse effect on our business, financial condition or results of operations.
Additionally, other steel producers may have or may be able to negotiate labor agreements that
provide them with a competitive advantage. In addition, many mini-mill producers and certain
foreign competitors and producers of comparable products do not have unionized work forces. This
may place us at a competitive disadvantage. Environmental compliance and remediation costs could decrease our net cash flow, reduce our results
of operations and impair our financial condition.
Our business and our ownership of real property are subject to numerous federal, state and local
laws and regulations relating to the protection of the environment. These laws are constantly
evolving and have become increasingly stringent. The ultimate impact of complying with
environmental laws and regulations is not always clearly known or determinable because regulations
under some of these laws have not yet been promulgated or are undergoing revision. We incur
substantial capital expenditures and other costs to comply with these environmental laws and
regulations, particularly the federal Clean Air Act, or CAA, and the federal Resource Conservation
and Recovery Act, or RCRA, and future developments under these or other laws could result in
substantially increased capital, operating and compliance costs. Additionally, future decisions to
terminate operations at any of our facilities may result in facility closure and cleanup costs. In
addition, if we are unable to comply with environmental regulations, we may incur fines or
penalties or may be required to cease some operations. For the year ended December 31, 2004, we incurred approximately $5.5 million in environmental
capital expenditures. Additional operational costs of complying with environmental laws are
included in costs of goods sold. In addition, environmental capital expenditures are expected to
be approximately $30.3 million in the aggregate for the years 2005 through 2007. If any of these
costs exceed our projections, our business, financial condition and results of operations could
suffer materially. 17




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We are involved in a number of environmental remediation projects relating to our facilities and
operations, and may in the future become involved in more remediation projects. While we reserve
for costs relating to such projects when the costs are probable and estimable, those reserves may
need to be adjusted as new information becomes available, whether from third parties, new
environmental laws or otherwise. Accrued environmental liabilities
totaled approximately $13.4 million as of December 31, 2004. In addition, we consider it
reasonably possible that we could ultimately incur additional liabilities relative to our
environmental exposures of up to $5.0 million. Increases in our healthcare costs for active employees and future retirees may lower our earnings
and negatively affect our competitive position in the industry.
We maintain defined benefit retiree healthcare plans covering all active union represented
employees upon their retirement. We also provide medical benefits for retired salaried employees
until they reach the age of 65. Healthcare benefits for active employees and future retirees are
provided through comprehensive hospital, surgical and major medical benefit provisions or through
health maintenance organizations, both the subject of various cost-sharing features. These
benefits are provided for the most part based on fixed amounts negotiated in labor contracts with
the appropriate unions. If our costs under our benefit programs for active employees and future
retirees exceed our projections, our business, financial condition and results of operations could
be materially adversely affected. Additionally, mini-mills, foreign competitors and many producers
of products that compete with steel typically provide lesser benefits to their employees and
retirees, and this difference in cost could adversely impact our competitive position. We may be subject to regulatory scrutiny and may sustain a loss of public confidence if we are
unable to satisfy regulatory requirements relating to internal controls over financial reporting.
Section 404 of the Sarbanes-Oxley Act of 2002 requires us to perform an evaluation of our internal
controls over financial reporting and have our auditor attest to such evaluation on an annual
basis. Compliance with these requirements has been expensive and time-consuming, and we expect
that to continue. While we believe that we will be able to continue to meet the required
deadlines, no assurance can be given that we will meet the required deadlines in future years. If
we fail to timely complete this evaluation, or if our auditors cannot timely attest to our
evaluation, we may be subject to regulatory scrutiny and a loss of public confidence in our
internal controls. Certain US federal income tax considerations may increase the amount of taxes we pay which could
adversely affect our liquidity and reduce profitability.
We believe that as a result of the issuance of our stock to certain debtors pursuant to our plan of
reorganization, effective as of August 1, 2003, we underwent an ownership change for purposes of
section 382 of the Internal Revenue Code of 1986, as amended (the Code). Generally, subject to
certain exceptions, section 382 of the Code does not limit the net operating loss (NOL)
carryovers of a company that has an ownership change as a result of a Chapter 11 bankruptcy
reorganization; however, if a company undergoes a subsequent ownership change within two years
following the bankruptcy reorganization, the company loses the ability to use any NOL carryovers
for all losses generated before the second ownership change. If we undergo a second ownership
change within two years after August 1, 2003, our ability to utilize our NOL carryovers, including
losses incurred after August 1, 2003, will be completely eliminated. Our NOL carryovers totaled
approximately $287 million as of December 31, 2003. The elimination of our ability to use our NOL
carryovers may increase the amount of taxes we may pay in the future which could adversely affect
our liquidity and our cash flow and reduce profitability. The largest beneficial owner of our shares, the VEBA trust, may have the ability to exercise
significant influence over our affairs, and the interests of the VEBA trust may differ from our
interests or the interests of other stockholders.   
    the composition of our board of directors, which has the authority to direct our business and to appoint and remove our
officers; 18




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
    approving or rejecting a merger, consolidation or other business combination;
    raising future capital; and
    amending our certificate of incorporation, which governs the rights associated with our common stock. This concentration of ownership of our common stock could delay or prevent proxy contests, mergers,
tender offers, open-market purchase programs or other purchases of our common stock that might
otherwise give you the opportunity to realize a premium over the then-prevailing market price of
our common stock. The independent trustee of the VEBA trust has a fiduciary obligation to maximize
the assets of the trust and as a result, the interests of the VEBA trust may be different from our
interests or the interests of other holders of our common stock, including investors who purchase
common stock in this offering. Provisions of our governing documents and Delaware law could discourage acquisition proposals or
delay a change in control involving us, even if that change of control would be beneficial.   
    our board of directors has the authority to issue common stock and
preferred stock and to determine the price, rights and preferences
of any new series of preferred stock without stockholder approval;
    our board of directors is initially divided into three classes,
serving staggered terms of one year, two years and three years,
respectively, until the 2006 annual meeting of the stockholders,
at which time all directors will be elected annually;
    our bylaws provide that until the 2006 annual meeting of
stockholders, any director or the entire board may be removed only
for cause and only by the holders of at least a majority of the
            shares of common stock;
    limitations on who can call special meetings of stockholders;
    stockholders may not take action by written consent; and
provisions of Delaware law may discourage, delay or prevent a
change of control of WPC or unsolicited acquisition proposals; and
    we adopted a shareholder rights plan in February 2005, the terms
of which may cause substantial dilution to a person or group that
attempts to acquire 4.99% or greater of our common stock on terms
not approved by our Board of Directors. Available Information
We maintain an Internet Website http://www.wpsc.com. We make available free of charge under the
Financial Reports heading on our website, our Annual Report on Form 10-K, Quarterly Reports on
Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant
to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after providing
such information electronically to the SEC. In addition, we also make available free of charge
under the Investor Relations heading on our website, the Companys audit committee, compensation
committee, nominating/corporate governance committee, executive committee, safety committee and
finance committee charters, as well as, the Companys corporate governance guidelines, code of
business conduct, whistleblower policy, and policy on trading of securities. 
 Item 2. PROPERTIES Steubenville Complex
We have one raw steel producing plant and various other finishing and fabricating facilities. The
Steubenville complex is an integrated steel producing facility located at Steubenville and Mingo
Junction, Ohio and Follansbee, West Virginia. The Steubenville complex includes coke oven batteries
that generally produce substantially all of our 19




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coke requirements, two operating blast furnaces, one EAF, one BOF with two vessels, a two-strand continuous slab caster with an annual slab
production capacity of approximately 2.8 million tons, an 80-inch hot strip mill and pickling and
coil finishing facilities. A railroad bridge owned by us connects the Ohio and West Virginia
locations, which are separated by the Ohio River. A pipeline is maintained for the transfer of coke
oven gas for use as fuel from the coke plant to several other portions of the Steubenville complex. The Steubenville complex
primarily produces hot rolled products, which are either sold to third parties or shipped to other
of our facilities for further processing into value-added products. Other Plants
The following table lists our other principal plants and the annual capacity of the major products
produced at each facility: Locations and Operations
    
    Capacity Tons/Year
    
    Major ProductAllenport, Pennsylvania: Continuous pickler, tandem
mill, temper mill and annealing lines
    
    
    1,120,000
    
    
    Cold-rolled sheetsBeech Bottom, West Virginia: Paint lines
    
    
    308,000
    
    
    Painted steel in coil formMartins Ferry, Ohio: Temper mill, zinc coating lines
    
    
    750,000
    
    
    Hot-dipped galvanized sheets and coilsYorkville, Ohio: Continuous pickler, tandem mill,
temper mills and annelaing lines
    
    
    660,000
    
    
    Blackplate and cold-rolled sheets
 All of the above facilities are currently owned by us and are regularly maintained in good
operating condition. However, continuous and substantial capital and maintenance expenditures are
required to maintain the operating facilities, to modernize finishing facilities in order to remain
competitive and to meet environmental control requirements. We also own, or lease fabricated products facilities at Fort Payne, Alabama; Houston, Texas;
Lenexa, Kansas; Louisville, Kentucky; Minneapolis, Minnesota; Warren, Ohio; Gary, Indiana; Emporia,
Virginia; Grand Junction, Colorado; Palmetto, Florida; Fallon, Nevada; and Rankin, Pennsylvania. We maintain regional sales offices in Chicago, Illinois and Pittsburgh, Pennsylvania and our
corporate headquarters is located in Wheeling, West Virginia. All of our property and equipment are subject to liens granted pursuant to our plan of
reorganization, as described in Item 7 of this annual report on
Form 10-K  Managements
Discussion and Analysis of Financial Condition and Results of Operation. 
 Item 3. LEGAL PROCEEDINGS We are defendants from time to time in routine lawsuits incidental to our business. We do not
believe that any proceedings, individually or in the aggregate, will have a material adverse effect
on us. See Environmental Matters below for a description of certain of our environmental
matters and Item 7 of this annual report on Form 10-K  Managements Discussion and Analysis of
Financial Condition and Results of Operation  Reorganization for a discussion of our
reorganization in bankruptcy effective August 1, 2003. Environmental Matters
As part of our plan of reorganization effective August 1, 2003, the Company settled all
pre-petition environmental liability claims made by environmental regulatory agencies arising out
of pre-petition stipulated penalties related to consent decrees and other pre-petition regulatory
enforcement actions. The Company also believes that it has settled and/or discharged environmental
liability for any known Comprehensive Environmental Response, Compensation, and Liability Act
(CERCLA or Superfund) sites arising out of pre-petition activity. The Company estimates that demands for stipulated penalties and fines for post-petition events and
activities through December 31, 2004 could total approximately $2.4 million, which has been fully
reserved by the Company. These claims arise from instances in which the Company exceeded
post-petition consent decree terms, including: (a) $1.9 million related to a January 30, 1996 USEPA
consent decree for the Companys coke oven gas desulfurization facility; (b) $0.3 million related
to a July 1991 USEPA consent decree for water discharges to the
Ohio River; and (c) $0.2 million related to a September 20, 1999 Ohio EPA consent decree for the Companys coke oven gas
desulfurization facility. 20




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##### Table of Contents



In September 2000, the Company entered into a consent order with the West Virginia Department of
Environmental Protection wherein the Company agreed to remove contaminated sediments from the bed
of the Ohio River. Approximately $1.4 million was spent on these activities in 2002, $0.6 million
in 2003 and $4.6 million in 2004. During removal activities in 2003, the Company discovered a
broader area of contaminated sediments. The Company estimates the cost of removal of the remaining
contaminated sediments at $3.4 million, which has been fully reserved by the Company. The Company
currently expects this work to be substantially complete by the end of 2006. The Company is under a final administrative order issued by the USEPA in June 1998 to conduct a
Resource Conservation and Recovery Act Facility Investigation to determine the nature and extent of
soil and groundwater contamination at its coke plant in Follansbee, West Virginia. USEPA approved
the Companys investigation work plan, and field activities were completed in 2004. The Company
will submit the results of this investigation to the USEPA in 2005. It is expected that some
remediation measures will be necessary and could commence within the next three to five years.
Based on a preliminary estimate of the range of the possible cost to remediate, the Company has
reserved approximately $5.2 million for such remediation measures. The USEPA conducted a multimedia inspection of our Steubenville, Mingo Junction, Yorkville and
Martins Ferry, Ohio and Follansbee, West Virginia facilities in March and June 1999. The inspection
covered environmental regulations applicable to these plants. Many of the issues were resolved and
settled prior to emergence from Chapter 11 bankruptcy. Based on current estimates, the Company has
reserved $1.4 million for resolution of outstanding issues. Capital expenditures for environmental projects totaled $5.5 million for the year ended December
31, 2004. The Company estimates capital expenditures for environmental projects to be $12.0 million
for 2005, $14.2 million for 2006 and $4.1 million for 2007. However, due to the possibility of
unanticipated factual or regulatory developments, the amount and timing of future capital
expenditures may vary substantially from such estimates. Accrued environmental liabilities totaled $13.4 million at December 31, 2004. These accruals were
based on all information available to the Company. As new information becomes available, whether
from third parties or otherwise, and as environmental regulations change, the liabilities are
reviewed on a quarterly basis and the accruals are adjusted accordingly. Unless stated above, the
time frame over which these liabilities will be paid is presently unknown. Further, the Company
considers it reasonably possible that it could ultimately incur additional liabilities relative to
the above exposures of up to $5.0 million. 
 Item 4. SUBMISSIONS OF MATTERS TO A VOTE TO SECURITY HOLDERS No matters were submitted to a vote of WPCs security holders during the fourth quarter of 2004. 21




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##### Table of Contents



PART II 
 Item 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER REPURCHASES
OF EQUITY SECURITIES Wheeling-Pittsburgh Corporation common stock is traded on the Nasdaq National Market under the
symbol WPSC. The following table presents, for the periods indicated, the high and low closing sales prices of
our common stock as reported by the Nasdaq National Market: High
    
    
    LowYear ended December 31, 2004:Fourth quarter
    
    $
    41.86
    
    
    $
    26.48Third quarter
    
    $
    31.31
    
    
    $
    19.75Second quarter
    
    $
    22.85
    
    
    $
    12.93First quarter
    
    $
    24.82
    
    
    $
    18.56Year ended December 31, 2003:Fourth quarter (from October 28, 2003) (1)
    
    $
    26.47
    
    
    $
    5.40
   (1)
    Shares of our common stock began trading on the Nasdaq National Market on
October 28, 2003. As of February 28, 2005, we had 14,434,715 shares of common stock outstanding and 3,304
stockholders of record. Dividend policy
We currently intend to retain earnings for the continued development and expansion of our business.
In addition, the terms of our credit agreements and indentures impose restrictions and limitations
on the payment of dividends and the making of other distributions in respect of WPCs common stock.
Pursuant to the terms of our credit agreements, WPC is prohibited from directly or indirectly
declaring or paying any dividend or making any other distribution on its common stock (other than
dividends payable solely in its common stock). Similarly, pursuant to the terms of the indentures
governing its Series A and Series B notes, WPSC is prohibited from declaring or paying any dividend
or making any other distribution on its common stock (other than dividends and distributions
payable in its common stock). In the absence of such restrictions or limitations, the payment of
any dividends will be at the discretion of our board of directors. Adoption of Shareholder Rights Plan On February 14, 2005, the Company adopted a shareholder rights plan primarily intended to help
protect its tax net operating loss carryforwards. As part of the plan, the Company declared a
dividend of one right for each share of common stock held of record as of March 2, 2005, payable on
March 2, 2005. The rights may cause substantial dilution to a person or group that attempts to
acquire 4.99% or greater of our common stock on terms not approved by our Board of Directors.
Acquisitions of our common stock that would otherwise trigger the rights under the terms of the
plan are permitted where the entire Board of Directors has determined, prior to consummation, that
the transaction is fair to and in the best interests of our stockholders. In addition, the Board
of Directors may redeem the rights, at its discretion, at a redemption price of $.01 per right at
any time until the close of business on the earlier of (i) the 10th day following the first day of
any public announcement that a person has become an acquiring person under the terms of the rights
plan or any earlier date on which the Board of Directors becomes aware of the existence of an
acquiring person, or (ii) on the 10th business day after the date of commencement of a
tender offer or exchange offer the consummation of which would result in any person or group
becoming an acquiring person. The shareholder rights plan will expire on the earlier of the third
anniversary date of the plan, or the date, if any, on which the Company first disclosed in any
filing with the Securities and Exchange Commission that the Companys net operating loss carry forwards no longer exceed $50 million. A copy of the Rights Agreement
entered into by the 22




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Company in connection with the shareholder rights plan has been filed as an
exhibit to a Registration Statement on Form 8-A filed with the Securities and Exchange Commission
on February 18, 2005. 
 Item 6. SELECTED FINANCIAL DATA The following selected historical consolidated financial data for each of the year ended December
31, 2004, the five-month period ended December 31, 2003, the seven month period ended July 31,
2003, and the year ended December 31, 2002 have been derived from our audited consolidated
financial statements included in this report. Such financial statements have been audited by
PricewaterhouseCoopers LLP, independent registered public accounting firm, whose reports are
included in this report. The financial data for the years ended December 31, 2001 and 2000 have
been derived from our audited financial statements that are not included in this report. We adopted fresh-start accounting effective as of July 31, 2003, at the time our plan of
reorganization became effective. As a result of this change in accounting, our historical financial
statements will not be comparable to our future financial statements and therefore have been
separated by a black line. Reorganized Company
    
    
    
    
    
    
    
    Predecessor Company(Dollars in thousands,except per share amounts)Year
    
    
    Five Months
    
    
    
    Seven MonthsEnded
    
    
    Ended
    
    
    
    Ended
    
    
    
    
    
    
    Year EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    
    
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002
    
    
    2001
    
    
    2000Consolidated Statement of
Operations Data:Net sales, including sales to
affiliates of $367,735, $101,501,
$164273, $258,681, $204,537 and
$225,441
    
    $
    1,405,794
    
    
    $
    396,902
    
    
    
    $
    570,439
    
    
    $
    979,993
    
    
    $
    835,640
    
    
    $
    1,119,031Cost of sales, excluding
depreciation, including cost of
of products sold to affiliates of
$324,813, $91,262, $143,840,
$238,927, $204,107 and
$192,514
    
    
    1,206,773
    
    
    
    395,950
    
    
    
    
    563,832
    
    
    
    894,449
    
    
    
    866,065
    
    
    
    1,054,386Depreciation and amoritization
expense
    
    
    33,433
    
    
    
    10,473
    
    
    
    
    39,889
    
    
    
    74,194
    
    
    
    72,551
    
    
    
    78,859Selling, general and administrative
expense
    
    
    67,257
    
    
    
    23,564
    
    
    
    
    29,906
    
    
    
    46,993
    
    
    
    47,173
    
    
    
    68,165Reorganization and professional
fee expense
    
    
    
    
    
    
    (35
    )
    
    
    
    8,140
    
    
    
    11,755
    
    
    
    14,200
    
    
    
    4,140Operating income (loss)
    
    
    98,331
    
    
    
    (33,050
    )
    
    
    
    (71,328
    )
    
    
    (47,398
    )
    
    
    (164,349
    )
    
    
    (86,519
    )Interest expense and other
financing costs
    
    
    (19,778
    )
    
    
    (10,215
    )
    
    
    
    (9,185
    )
    
    
    (15,987
    )
    
    
    (17,448
    )
    
    
    (35,969
    )Other income (expense)
    
    
    17,520
    
    
    
    4,350
    
    
    
    
    3,228
    
    
    
    4,567
    
    
    
    351
    
    
    
    (3,015
    )Reorganization adjustments
    
    
    
    
    
    
    
    
    
    
    
    400,075
    
    
    
    1,262
    
    
    
    9,249
    
    
    
    (2,592
    )Income (loss) before taxes
    
    
    96,073
    
    
    
    (38,915
    )
    
    
    
    322,790
    
    
    
    (57,556
    )
    
    
    (172,197
    )
    
    
    (128,095
    )Tax provision (benefit)
    
    
    33,606
    
    
    
    15
    
    
    
    
    (641
    )
    
    
    11
    
    
    
    17
    
    
    
    90,092Net income (loss)
    
    $
    62,467
    
    
    $
    (38,930
    )
    
    
    $
    323,431
    
    
    $
    (57,567
    )
    
    $
    (172,214
    )
    
    $
    (218,187
    )Basic earnings (loss) per share
    
    $
    5.81
    
    
    $
    (4.10
    )
    
    
    
    *
    
    
    
    *
    
    
    
    *
    
    
    
    *Fully diluted earnings (loss) per share
share
    
    $
    5.68
    
    
    $
    (4.10
    )
    
    
    
    *
    
    
    
    *
    
    
    
    *
    
    
    
    *Average basic shares outstanding
    
    
    10,758,908
    
    
    
    9,500,000
    
    
    
    
    *
    
    
    
    *
    
    
    
    *
    
    
    
    *Average diluted shares outstanding
    
    
    11,002,203
    
    
    
    9,500,000
    
    
    
    
    *
    
    
    
    *
    
    
    
    *
    
    
    
    *
    23




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##### Table of Contents



Reorganized Company
    
    
    
    
    
    
    
    Predecessor Company(Dollars in thousands,except per share amounts)Year
    
    
    Five Months
    
    
    
    Seven MonthsEnded
    
    
    Ended
    
    
    
    Ended
    
    
    
    
    
    
    Year EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    
    
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002
    
    
    2001
    
    
    2000Consolidated Operating and
Other Data:Employment:Employment costs
    
    $
    239,236
    
    
    $
    94,651
    
    
    
    $
    143,265
    
    
    $
    248,829
    
    
    $
    253,529
    
    
    $
    297,011Average number of employees
    
    
    3,280
    
    
    
    3,299
    
    
    
    
    3,621
    
    
    
    3,796
    
    
    
    3,701
    
    
    
    4,344Production and Shipments:Raw steel
production  tons
    
    
    2,362,886
    
    
    
    958,816
    
    
    
    
    1,399,853
    
    
    
    2,527,826
    
    
    
    2,266,605
    
    
    
    2,344,649Shipments of
steel products   tons
    
    
    2,125,434
    
    
    
    912,937
    
    
    
    
    1,305,046
    
    
    
    2,213,506
    
    
    
    2,027,037
    
    
    
    2,354,308Average sales price per ton
    
    $
    661
    
    
    $
    435
    
    
    
    $
    437
    
    
    $
    443
    
    
    $
    412
    
    
    $
    475Other:Operating income (loss) per ton
shipped
    
    $
    46
    
    
    $
    (36
    )
    
    
    $
    (55
    )
    
    $
    (21
    )
    
    $
    (81
    )
    
    $
    (34
    )
  Reorganized Company
    
    
    
    Predecessor CompanyDollars in thousandsAs of
    
    
    As of
    
    
    
    
    
    
    
    
    
    
    
    As ofDecember 31,
    
    
    July 31,
    
    
    
    
    
    
    
    
    
    
    
    December 31,2004
    
    
    
    
    
    
    2003
    
    
    2003
    
    
    
    
    
    
    
    2002
    
    
    2001
    
    
    2000Consolidated Balance Sheet
Data (end of period)Cash, cash equivalents and
short-term investments
    
    $
    31,198
    
    
    
    
    
    
    $
    4,767
    
    
    $
    7,382
    
    
    
    
    
    
    
    $
    8,543
    
    
    $
    7,586
    
    
    $
    15,534Working capital (deficit)
    
    
    153,190
    
    
    
    
    
    
    
    7,765
    
    
    
    47,100
    
    
    
    
    
    
    
    
    (255
    )
    
    
    (187
    )
    
    
    121,406Property,
plant and equipment  net
    
    
    487,308
    
    
    
    
    
    
    
    387,765
    
    
    
    360,213
    
    
    
    
    
    
    
    
    530,568
    
    
    
    593,888
    
    
    
    666,454Total assets
    
    
    955,359
    
    
    
    
    
    
    
    868,886
    
    
    
    878,769
    
    
    
    
    
    
    
    
    959,116
    
    
    
    990,865
    
    
    
    1,170,436Total debt, including capitalized
and revolving credit facility
    
    
    333,583
    
    
    
    
    
    
    
    343,394
    
    
    
    343,603
    
    
    
    
    
    
    
    
    56,752
    
    
    
    40,344
    
    
    
    35,091Liabilities subject to compromise
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    890,301
    
    
    
    915,118
    
    
    
    942,182Stockholders equity (deficit)
    
    
    290,478
    
    
    
    
    
    
    
    104,613
    
    
    
    142,500
    
    
    
    
    
    
    
    
    (311,171
    )
    
    
    (253,604
    )
    
    
    (81,390
    )
 24




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##### Table of Contents



Item 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS The following should be read in conjunction with the Consolidated Financial Statements and related
notes that appear in Item 8 of this Annual Report on Form 10-K. This discussion contains forward-looking statements that involve numerous risks and uncertainties.
Our actual results could differ materially from those discussed in the forward-looking statements
as a result of various factors, including those set forth In
Item 1  Business  Risk Factors and
elsewhere in this report. OVERVIEW
We produce flat rolled steel products for the construction industry, steel service centers,
converters, processors, and the container and appliance industries. Our product offerings are
focused predominately on higher value-added finished steel products such as cold rolled products,
tin and zinc coated products and fabricated products. In addition, we produce semi-finished steel
products and hot rolled steel products, which represent the least processed of our finished goods. An operating division of WPSC, WCC manufactures our fabricated steel products for the construction,
agricultural and highway industries. WPSC also has ownership interests in two joint ventures,
Wheeling-Nisshin and OCC, which together consumed more than 30% of our steel tonnage shipped in
2004, representing 26.2% of our 2004 net sales. These joint ventures produce value-added steel
products from materials and products supplied by us. The steel industry is cyclical and highly competitive and is affected by excess world capacity,
which has restricted price increases during periods of economic growth and led to price decreases
during economic contraction. Beginning in 1998 and continuing through 2000, record high levels of
foreign steel imports as well as a general overcapacity in worldwide steel production caused a
marked deterioration of steel prices, resulting in huge losses and substantial harm to the domestic
steel industry. This record high level of foreign steel imports over a three-year period, coupled
with the indebtedness we incurred as a result of a ten-month work stoppage which ended in August
1997, and approximately $200 million of capital expenditures used to modernize our facilities to
increase quality, efficiency, safety and environmental conditions, resulted in substantial losses
and the severe erosion of our financial position and liquidity. These losses and erosion of
liquidity continued to occur notwithstanding increases in operating efficiencies resulting from the
modernization of our facilities, various cost saving measures and the elimination of 20% of our
hourly workforce negotiated in 1997, ultimately resulting in us filing for relief under Chapter 11
of the US Bankruptcy Code, as described below in further detail under the heading
Reorganization. Over the past year, several factors, including an overall increase in the demand for steel,
particularly in China and other countries, higher raw material input costs and a continuing weak US
dollar have resulted in substantial increases in steel selling prices in the United States. The
cost to produce steel has also increased, principally due to an increase in the cost of raw
materials, in particular scrap, coal, coke and natural gas. The net result has had a favorable
impact on our operating results and those of most other domestic producers. On September 21, 2004, we completed a public stock offering of 3,719,898 shares of our common stock
at an offering price of $29 per share. The net proceeds from the sale of $99.7 million were used
to repay all amounts outstanding under our revolving credit agreement and to fund a restricted cash
account for future capital expenditures. In November 2004, we completed construction of our electric arc furnace (EAF) with the EAF
producing its first heat on November 28, 2004. The EAF achieved over 40% of capacity with a cold
metallic charge in the second month of operations. The EAF is expected to be operating at 75% of
capacity by May 2005 and at full capacity by the fourth quarter of 2005. Steel production from the
EAF, along with the idling of one of our two blast furnaces, will transform our operations from an
integrated producer to a hybrid producer of steel with characteristics of both an integrated
producer and a mini-mill. This transformation will provide flexibility in our steel making process
by enabling us to use the EAF on its own or in conjunction with our remaining blast furnace and
basic oxygen furnace (BOF). The EAF has a continuous scrap feed, or Consteel®, and is
differentiated from most mini-mills in that it has the ability to receive liquid iron as an
alternative metallic input to more conventional steel scrap charged materials, enabling us to
optimize our raw material input costs. Consteel® is the process of continuously feeding
and pre-heating the metallic scrap charge to the EAF. The EAF will also reduce our requirements for
coke as a raw material input. In June 2004, we entered into a long-term scrap supply agreement designed to provide us
with an adequate 25




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##### Table of Contents



and reliable source of scrap for our EAF operations. The EAF has several
additional advantages over integrated steel production including lower capital expenditures for
construction of facilities, a more variable cost structure and limited ongoing capital requirements
to sustain operations. We expect to be able to maintain existing quality levels across our full
range of products while using the EAF in our steel making process. We believe that the EAF has an
annual production capacity of up to 2.5 million tons of liquid steel, depending on the mix of hot
metal and scrap inputs. The flexibility of using various operating configurations of the EAF and
BOF to maximize steel production is expected to enable us to produce 2.8 million tons of steel
slabs annually and manage our cost structure more efficiently. On December 23, 2004, WPSC entered into a Letter of Intent with Severstal North America, Inc.
Under the non-binding terms of the letter of intent, WPSC and Several North America, Inc. agreed to
form a Delaware limited liability company for the production of coke and coke related products. As
part of the proposed project, WPSC is expected to contribute its coke producing batteries, certain
related facilities and assets located at its facility in Follansbee, West Virginia and $20 million
to the limited liability company. Severstal North America, Inc. is expected to make cash
contributions in the amount of $140 million to the limited liability company over three years,
which would be used to substantially rebuild the coke batteries. After all contributions are
received, the limited liability company would be owned 50% by WPSC and 50% by Severstal North
America, Inc. Both parties would then be entitled to 50% of the coke produced by the facility. On February 14, 2005, we adopted a shareholder rights plan primarily intended to help protect our
tax net operating loss carryforwards. As part of the plan, we declared a dividend of one right for
each share of common stock held of record as of March 2, 2005, payable on March 2, 2005. The
rights may cause substantial dilution to a person or group that attempts to acquire 4.99% or
greater of our common stock on terms not approved by our Board of Directors. Acquisitions of our
common stock that would otherwise trigger the rights under the terms of the plan are permitted
where the entire Board of Directors has determined, prior to consummation, that the transaction is
fair to and in the best interests of our stockholders. In addition, the Board of Directors may
redeem the rights, at its discretion, at a redemption price of $.01 per right at any time until the
close of business on the earlier of (i) the 10th day following the first day of any public
announcement that a person has become an acquiring person under the terms of the rights plan or any
earlier date on which the Board of Directors becomes aware of the existence of an acquiring person,
or (ii) on the 10th business day after the date of commencement of a tender offer or exchange offer
the consummation of which would result in any person or group becoming an acquiring person. The
shareholder rights plan will expire on the earlier of the third anniversary date of the plan, or
the date, if any, on which the Company first discloses in any filing with the Securities and
Exchange Commission that the Companys net operating loss carryforwards no longer exceed $50
million. Reorganization
On November 16, 2000, WPC and eight of our then-existing wholly-owned subsidiaries, which
represented substantially all of our business, filed voluntary petitions for relief under Chapter
11 of the US Bankruptcy Code in the US Bankruptcy Court for the Northern District of Ohio, referred
to herein as the Bankruptcy Court. We commenced the Chapter 11 proceedings in order to restructure
our outstanding debts and to improve our access to the additional funding that we needed to
continue our operations. Throughout the Chapter 11 proceedings, we remained in possession of our
properties and assets and continued to operate and manage our businesses with the then-existing
directors and officers as debtors-in-possession subject to the supervision of the Bankruptcy Court. As part of our Chapter 11 proceedings, we filed our original Joint Plan of Reorganization on
December 20, 2002, our First Amended Joint Plan of Reorganization on January 9, 2003, our Second
Amended Joint Plan of Reorganization on May 5, 2003 and our Third Amended Joint Plan of
Reorganization on May 19, 2003, reflecting the final negotiations with pre-petition note holders,
pre-petition trade creditors and unionized employees. Our Third Amended Joint Plan of
Reorganization was confirmed by order of the Bankruptcy Court on June 18, 2003, and became
effective on August 1, 2003. We realized approximately $558 million in cancellation of debt income
as a result of our reorganization. Following is a summary of some of the significant transactions consummated on or about the
effective date of our plan of reorganization.  
    WPC amended and restated its by-laws and filed a second amended and restated certificate
of incorporation with the Delaware Secretary of State authorizing the issuance of up to an
aggregate of 80 million shares of 26




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##### Table of Contents



common stock, par value $0.01 per share, and 20 million shares of undesignated preferred stock, par value $0.001 per share.  
    WPC exchanged, on a pro rata basis, $275 million in senior notes and $75 million in term
notes that existed prior to its bankruptcy filing for an aggregate of $20 million in cash,
$40 million in Series A secured notes issued by WPSC, collateralized by a second lien on
our tangible and intangible assets (other than our accounts receivable and inventory), our
equity interests in our joint ventures, mortgaged real property and pledged stock of our
subsidiaries and a third lien on our accounts receivable and inventory, $20 million in new
Series B secured notes issued by WPSC, collateralized by a fifth lien on our tangible and
intangible assets, our equity interests in our joint ventures, and our accounts receivable
and inventory, and 3,410,000 shares of common stock of WPC constituting 34.1% thereof.
    WPC cancelled its then-existing senior notes and related indenture and its then-existing
term notes and the related term loan agreement.
    WPC cancelled all shares of its common stock that existed prior to the implementation of
our plan of reorganization, at which point we ceased to be a subsidiary of WHX Corporation.
    WPSC entered into a new $250 million senior secured term loan agreement, which is
guaranteed in part by the Emergency Steel Loan Guarantee Board, the West Virginia Housing
Development Fund, WPC and WP Steel Venture Corporation, a wholly-owned subsidiary of WPC,
and is collateralized by a first lien on our tangible and intangible assets (other than
accounts receivable and inventory), our equity interests in our joint ventures, mortgaged
real property and pledged stock of our subsidiaries and a second lien on our accounts
receivable and inventory. WPSC also entered into a new $225 million senior secured
revolving credit facility, which is guaranteed by WPC and WP Steel Venture Corporation and
is collateralized by a first lien on our accounts receivable and inventory and a third lien
on our other tangible and intangible assets, our equity interests in our joint ventures,
mortgaged real property and pledged stock of our subsidiaries.
    All of our obligations under our $195 million debtor-in-possession credit facility were
satisfied in full and discharged.

    WPC and WPSC entered into agreements with WHX Corporation providing for, among other
things, a $10 million capital contribution by WHX Corporation, the capitalization of
approximately $40 million in debt owed by us to WHX Corporation, a $10 million unsecured
loan from WHX Corporation and an agreement with WHX Corporation, the Pension Benefit
Guaranty Corporation, or PBGC, and the USWA with respect to our separation from WHX
Corporations employee pension plan.
    WPC and WPSC entered into an agreement with our unionized employees represented by the
United Steelworkers of America, or USWA, which modified our existing labor agreement to
provide for, among other things, future pension arrangements with USWA and reductions in
our employee-related costs.
    WPC issued 4,000,000 shares of its new common stock constituting 40% thereof for the
benefit of USWA retirees in satisfaction of certain claims under our prior labor agreement
and an additional 1,000,000 shares of its common stock constituting 10% thereof to or for
the benefit of our salaried employees.
    WPC issued 1,590,000 shares of its new common stock constituting 15.9% thereof to
certain of our creditors in satisfaction of various unsecured claims, including claims
relating to trade debt. There are still several matters pending in the Bankruptcy Court, including the resolution of
disputed unsecured and administrative claims and certain preference actions and other litigation
where we are seeking to recover monies. As of December 31, 2004, approximately 53,052 shares of
common stock issued pursuant to the plan of reorganization were reserved for distribution to
creditors pending resolution of certain disputed claims. If those claims are ultimately allowed in
whole or in part by the Bankruptcy Court, the appropriate amount of stock will be distributed to
those claimants; if the claims are disallowed, the stock will be distributed to other creditors of
the same class, pro rata. To the extent that certain administrative and secured claims are allowed by the Bankruptcy
Court, those claims will be paid in cash, in an amount which we expect will not exceed $100
thousand and for which there are sufficient reserves held by the distribution agent. If and to the
extent those claims are allowed as pre-petition unsecured 27




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##### Table of Contents



claims, then those creditors will receive stock, which has been reserved as described above.
In addition, we are the plaintiffs in a number of preference actions, where we are seeking to
recover monies from creditors. We do not believe that any of these remaining bankruptcy
proceedings, individually or in the aggregate, will have a material effect on us. CRITICAL ACCOUNTING POLICIES AND ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted
in the United States requires management to make judgments, estimates and assumptions that affect
reported amounts of assets and liabilities at the balance sheet date and the reported revenues and
expenses for the period. Our judgments and estimates are based on both historical experience and
our expectations for the future. As a result, actual results may differ materially from current
expectations. We believe that the following are the more significant judgments and estimates used in the
preparation of the financial statements. Fresh Start Reporting In accordance with SOP 90-7, effective as of July 31, 2003, we adopted Fresh Start Reporting
for our reorganized company and recorded assets and liabilities at their fair values. Enterprise
value was estimated using discounted cash flow methodologies and analysis of comparable steel
companies. Other Postemployment Benefits (OPEB) The traditional medical and life insurance benefits that were provided to past retirees were
terminated effective October 1, 2003. Pursuant to our labor agreement, which we entered into in
connection with our plan of reorganization, past retirees will receive medical and life insurance
benefits under a VEBA trust. Future retirees under the labor agreement will be covered by a medical
and life insurance program similar to that of active employees. All retirees and their surviving
spouses shall be required to make monthly contributions for medical and prescription drug coverage,
which, in the case of those covered under the VEBA trust, are made directly to the trust. Because
these benefits provided by us will be paid in the future over what could be many years, we estimate
the accrued liability at each year-end balance sheet date using actuarial methods. The two most
significant assumptions used in determining the liability are the projected medical cost trend rate
and the discount rate. We estimate the escalation trend in medical costs based on historical rate experience in our plans
and through consultation with health care specialists. We have assumed an initial escalation rate
of 11.0% in 2005. This rate is assumed to decrease gradually to an ultimate rate of 5.0% in 2009
and remain at that level for all future years. The health care cost trend rate assumption has a
significant effect on the costs and obligation reported. A 1% increase in the health care cost
trend rate would result in an increase in the accumulated postretirement benefit obligation of
approximately $4.3 million. A 1% decrease in the health care cost trend rate would result in a
decrease in the accumulated postretirement benefit obligation of approximately $2.1 million. A 1%
increase in the health care cost trend rate would result in an increase in post-retirement benefit
expenses of approximately $0.4 million annually. A 1% decrease in the health care cost trend rate
would result in a decrease in post-retirement benefit expenses of approximately $0.2 million
annually. The discount rate applied to our OPEB obligations is based on high quality bond rates and the
expected payout period of our OPEB obligations. The discount rate used to measure our OPEB
obligation at December 31, 2004 was 5.75%. Management believes
this rate to be appropriate based on the demographics of the employee
group covered under the plan, which does not include hourly employees
who retired prior to October 1, 2003. A 1% increase in the discount rate would result in a
decrease in the accumulated postretirement benefit obligation of approximately $4.8 million. A 1%
decrease in the discount rate would result in an increase in the accumulated postretirement benefit
obligation of approximately $5.0 million. A 1% increase in the discount rate would result in a
decrease in post-retirement benefit expenses of approximately $380 thousand. A 1% decrease in the
discount rate would result in an increase in post-retirement benefit expenses of approximately $370
thousand. Asset impairments We periodically evaluate property, plant and equipment for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable. Asset impairments are
recognized when the carrying value of productive assets exceeds the net projected undiscounted cash
flows from those assets. Given our integrated operations, asset impairment evaluations are
generally done on a group basis. Undiscounted cash flows are based on longer-term projections that
consider projected market conditions and the performance and ultimate use of the assets. If future
demand and market conditions are less favorable than those projected by 28




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##### Table of Contents



management, or if the
probability of disposition of the assets differs from that previously estimated by management,
asset impairments may be required. The fair values as of August 1, 2003 used for fresh start
reporting and the subsequent depreciation rates reflected our intention to idle one of our blast
furnaces. Deferred taxes Full realization of net deferred tax assets is dependent on our ability to generate future taxable
income and maintain substantially our existing ownership. An ownership change, as defined in
Section 382 of the Internal Revenue Code of 1986, could completely eliminate our net operating loss
carryovers. We record a valuation allowance to reduce deferred tax assets to an amount that is more
likely than not to be realized. During 2000, our company recorded a full valuation allowance
against our net deferred tax assets due to the uncertainties surrounding realization as a result of
the bankruptcy proceedings. Deferred tax assets that have arisen since that time, which principally
consist of net operating losses, have also been fully reserved. However, as our operations
continue, we will be required to periodically reevaluate the tax treatment of these deferred tax
assets in light of actual operating results. Environmental and legal contingencies We provide for remediation costs, environmental penalties and legal contingencies when the
liability is probable and the amount of the associated costs is reasonably determinable. We
regularly monitor the progress of environmental remediation and legal contingencies, and revise the
amounts recorded in the period in which changes in estimate occur. RESULTS OF OPERATIONS The consolidated financial statements from and after the effective date of our plan of
reorganization August 1, 2003, are those of a new reporting entity (the Reorganized Company)
and are not comparable to the pre-confirmation periods of the old reporting entity (the
Predecessor Company). Year ended December 31, 2004 Net sales for the year ended December 31, 2004 totaled $1,405.8 million on shipments of steel
products totaling 2.1 million tons. Steel prices averaged $661 per ton in 2004, including $77 per
ton for raw material surcharges. As a result of substantially higher raw material costs
experienced by us and our competitors, surcharges were implemented throughout the industry in early
2004, in order to recoup the higher raw material costs. Average steel price per ton reflected a
mix of products that included 30.7% hot rolled in 2004. Cost of goods sold for the year totaled $1,206.7 million, or $568 per ton shipped. Cost of goods
sold increased during 2004 as costs for scrap, coal, iron ore and alloys increased significantly.
Due to disruptions in our coal supply during 2004 and related maintenance issues at our coke
facility, it was necessary for us to supplement our internal production of coke with high-cost spot
coke purchases, incur significant coke battery repair costs, and purchase additional natural gas.
Other facilities also incurred relatively high repair costs to ensure reliable production capacity.
Cost of goods sold was adversely affected by the collapse of BOF ductwork at our principal
steelmaking facility in December 2004, which interrupted operations for 12 days. The company is
pursuing insurance recoveries for property damage and the business interruption effects of the
incident. Flooding on the Ohio River during September 2004 also caused us to lose production and
incur additional costs. Cost of goods sold included charges related to our VEBA
and profit sharing plans and a contractual 5.8% wage
increase for USWA employees in May 2004. The raw steel production-operating rate for the year,
which included unplanned outages, was 91.6% of capacity. Cost of goods sold was reduced in 2004 by $2.8 million resulting from the settlement of a
pre-petition insurance claim and by $5.0 million related to a non-recurring VEBA expense reduction
item. Depreciation expense for the year totaled $33.4 million on average fixed assets of $463.8 million.
Fixed assets were recorded at fair value as part of the reorganization. Selling, administrative and general expense for the twelve-month period totaled $67.3 million. Interest expense for the twelve-month period totaled $19.8 million. Long-term debt averaged $338.5
million during the period. Borrowings under the revolving credit facility ranged from $79.2
million to $92.7 million through 29




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##### Table of Contents



September 2004, at which time outstanding indebtedness under our
revolving credit facility was repaid with proceeds from our public stock offering. Interest
expense also includes amortization of capitalized financing costs. Other income totaled $17.5 million for the year and primarily reflected equity earnings of our
joint ventures.
Net income for the year ended December 31, 2004 totaled $62.5 million, or $5.81 earnings per basic
share and $5.68 earnings per diluted share. Five months ended December 31, 2003  Reorganized Company Net sales for the five-month reorganized period ended December 31, 2003 totaled $396.9 million on
shipments of steel products totaling 0.9 million tons. Steel prices averaged $435 per ton. The
average steel price per ton reflected a mix of products that included 30.2% hot rolled. Cost of goods sold totaled $396.0 million for the five-month period. Cost of goods sold averaged
$434 per ton shipped. Raw material costs and fuel costs were impacted by market prices that were
higher than in recent years. The raw steel production-operating rate during the five-month period,
which included a 15-day planned outage in November, was 89.1%. Depreciation expense totaled $10.5 million for the five-month period on average fixed assets of
$379.5 million. Fixed assets were recorded at fair value as part of the plan of reorganization. Selling, administrative and general expense totaled $23.6 million for the five-month period. Interest expense totaled $10.2 million for the five-month period. Long-term debt totaled $340.7
million and the revolving credit facility ranged from $36.9 million to $79.3 million. Interest
expense also included amortization of capitalized finance costs. Other income totaled $4.4 million for the five-month period and primarily reflected equity earnings
of our joint ventures. The net loss for the five-month period ended December 31, 2003 totaled $38.9 million, or a $4.10
loss per basic and diluted share. Seven months ended July 31, 2003  Predecessor Company Net sales for the seven-month pre-reorganization period ended July 31, 2003 totaled $570.4 million
on shipments of steel products totaling 1.3 million tons. Steel prices averaged $437 per ton. The
average steel price per ton reflected a mix of products that included 28.2% hot rolled. Cost of goods sold for the seven-month period totaled $563.8 million. Cost of goods sold averaged
$432 per ton shipped. The raw steel production-operating rate during the seven-month period was
93.7% of capacity. Depreciation expense for the seven-month period totaled $39.9 million on average fixed assets,
before revaluation, of $1,248.6 million. Selling, administrative and general expense for the seven-month period totaled $29.9 million. Reorganization and professional fee expense totaled $8.1 million for the seven-month period.
Non-recurring gains totaled $400.1 million for the seven-month period as a result of our emergence
from bankruptcy as of August 1, 2003. The $557.5 million gain on discharge of debt reflected
pre-petition liabilities in excess of distributions made pursuant to our plan of reorganization.
The $152.7 million fair value adjustment primarily reflected the revaluation of fixed assets. Other
reorganization entries amounted to a loss of $4.7 million. Interest expense for the seven-month period totaled $9.2 million, which primarily reflected
interest on the revolving credit facility. Other income totaled $3.2 million for the seven-month period and primarily reflected equity
earnings of our joint ventures. The net income for the seven-month pre-organization period ended July 31, 2003 totaled $323.4
million. 30




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Year ended December 31, 2002 Net sales for 2002 totaled $980.0 million on shipments of 2.2 million tons of steel products.
Steel prices averaged $443 per ton. The average steel price per ton reflected a mix of products
that included 26.4% hot rolled. Cost of goods sold for the year totaled $894.4 million. Cost of goods sold averaged $404 per ton
shipped. Cost of goods sold was reduced in 2002 as the result of significant wage and salary
reductions for both hourly and salaried employees. The raw steel production-operating rate during
2002 was 98.3% of capacity. Depreciation expense was $74.2 million in 2002 on average fixed assets, before revaluation, of
$1,245.8 million. Selling, administrative and general expense was $47.0 million in 2002. Reorganization and professional fee expense was $11.8 million in 2002. Legal expense related to
the reorganization was $4.9 million in 2002. Accounting and reorganization advisory expense related
to the reorganization was $3.5 million in 2002 and other professional services expense was $3.4
million in 2002. Reorganization income for the year was $1.3 million. Interest expense for the year was $16.0 million, which primarily reflected interest on the
revolving credit facility. Other income for the year was $4.6 million and primarily reflected equity earnings of our joint
ventures. The net loss for the year ended December 31, 2002 totaled $57.6 million. LIQUIDITY AND CAPITAL RESOURCES Since our emergence from Chapter 11 bankruptcy proceedings on August 1, 2003, our primary sources
of liquidity have been borrowings under our $250 million senior secured term loan agreement,
borrowings under our $225 million senior secured revolving credit facility, and a $10 million
unsecured note. We have used approximately $199.7 million of the proceeds of the foregoing debt
financings to pay our obligations under our plan of reorganization, including paying off our
debtor-in-possession credit facility and paying other cash claims under our plan of reorganization. On September 21, 2004, pursuant to a public offering, we sold 3,719,898 shares of common stock at
an offering price of $29 per share, generating gross sales proceeds of $107.9 million. These
proceeds, net of issuance costs of $8.2 million, were used to repay the outstanding indebtedness
under our revolving credit facility in the amount of $92.7 million and to fund a restricted cash account in the amount of $7.0 million to be used to
fund future capital expenditures. Our credit agreements required us to maintain borrowing availability of at least $50 million
under our revolving credit facility through December 31, 2004. After December 31, 2004, we are
required to maintain borrowing availability of at least $25 million under the facility. Under the
terms of our amended term loan agreement, we are also limited to a maximum of $150 million in
borrowings, including outstanding letters of credit, under our
revolving credit facility. Our credit agreements also specify certain
financial covenants, including a maximum leverage ratio, minimum
interest coverage ratio and minimum fixed charge coverage ratio with
which we must comply commencing with the quarter ending March 31,
2005. These financial covenants did not apply prior to that date as
long as we maintained minimum availability under our revolving credit
facility of at least $50 million through December 31, 2004. Our
minimum availability amounted to $131.3 million as of December 31,
2004. Additionally, had these financial covenants been applicable, we
would have been in compliance with these financial covenants as of
December 31, 2004. As of December 31, 2004, we had the following amounts available for our working capital and planned
capital expenditures: cash and cash equivalents of $31.2 million; $12.5 million of restricted
cash, including $5.5 million for construction of the electric arc furnace and $7.0 million for
other capital expenditures; and $131.3 million of availability under our revolving credit facility,
after giving effect to required reserves, outstanding letters of credit and the $150 million
maximum availability limitation under the facility, as discussed more fully below. For the year ended December 31, 2004, we generated cash flow from operating activities of $72.0
million. Considering our liquidity position as of December 31, 2004 noted above and provided that
business conditions do not deteriorate significantly, we anticipate being able to maintain
operations and meet our capital needs without the need for additional financing. 31




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The following table summarizes the categories of collateral that we have pledged to secure our
current debt obligations and the ranking of our debt obligations with respect to all of the
security interests that we have granted to date: Collateral TypeTangible and Intangible Assetsand Joint Venture Equity Interest
    
    Accounts Receivable and InventoryDebt obligation secured by first
security interest
    
    $250 Million Term Loan
    
    $225 Million Revolving Credit FacilityDebt obligation secured by second
security interest
    
    $40 Million Series A Notes
    
    $250 Million Term LoanDebt obligation secured by third
security interest
    
    $225 Million Revolving
Credit Facility
    
    $40 Million Series A NotesDebt obligation secured by fourth
security interest
    
    $20 Million Series B Notes
    
    $20 Million Series B Notes
 The deferred payment obligations with respect to the iron ore sales agreement with Itabira Rio
Doce were satisfied in full in December 2004. Therefore, the fourth security interest in tangible
and intangible assets and joint venture equity interest, and accounts receivable and inventory,
which previously secured these obligations, was released. In the event that we are unable to satisfy our payment and other obligations under our secured
debt, the lenders under our secured debt obligations have various rights and remedies, including
the right to force the sale of our assets and to apply the proceeds thereof to repay amounts owed
by us. If such a foreclosure were to occur, then we may be unable to maintain our operations, and
our business, financial condition and results of operations could materially suffer and our
shareholders may lose all or part of their investment. A summary description of these obligations
follows: $250 million term loan agreement In connection with our plan of reorganization, WPSC entered into a $250 million senior secured term
loan agreement due August 1, 2014 with a bank group led by Royal Bank of Canada as administrative
agent, which is guaranteed in part by the Emergency Steel Loan Guarantee Board, or the Steel Board,
and the West Virginia Housing Development Fund as described below. However, if the agent for the term loan lenders is
unable or unwilling, in its sole discretion, to re-offer certain tranches of the term loan as of
November 1, 2008, the maturity date for each tranche of the term loan will be November 1, 2008.
The agent is required to provide us notice on or before May 1, 2008 as to whether it will undertake
to re-offer certain tranches of the term loan. If the agent does not re-offer such tranches, we
must pay the agent an amount equal to all outstanding amounts under the term loan agreement on
August 1, 2008. Interest on borrowings is calculated based on either LIBOR or the prime rate using
varying spreads as defined for each of the three tranches in the agreement. The blended rate of
interest was approximately 4.1% at December 31, 2004. The term loan is to be repaid in quarterly
installments of $6.25 million, which began in the fourth quarter of 2004, with a final payment to
the agent of $150 million due on August 1, 2008 if such loan is not re-offered. Under the original terms of our term loan agreement, we were required to prepay an amount equal to
50% of the net cash proceeds (as defined in the term loan agreement) from any issuance or sale of
our capital stock and to apply such net cash proceeds to remaining installments in inverse order of
maturity. In June 2004, we entered into an amendment and waiver to our term loan agreement to
eliminate these prepayment requirements with respect to any issuance or sale of our capital stock
on or before January 31, 2005. Specifically, the amendment and waiver provides that the net cash
proceeds from the sale of our common stock in any offering on or before January 31, 2005 will be
applied first to repay any outstanding principal borrowing under our revolving credit facility
without reducing the commitment amount (excluding any letters of credit then outstanding), second,
to the extent of any excess, to fund up to $35 million in capital expenditures (other than the EAF
and the No. 8 coke battery) and third, to the extent of any then-remaining excess, to repay
principal amounts outstanding under our term loan agreement, with such repayments applied pro rata
across all three term loan tranches and pro rata against each scheduled maturity within each
tranche. All proceeds up to $35 million that are allocated for capital expenditures will be held
in a segregated cash account. On September 21, 2004, we sold 3,719,898 shares of common stock at
$29 per share, 32




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generating gross sales proceeds of $107.9 million. These proceeds, net of issuance
costs, were used to repay the outstanding indebtedness under our revolving credit facility in the
amount of $92.7 million and to fund a restricted cash account in the amount of $7.0 million to be
used to fund future capital expenditures. Additionally, the terms of the amendment and waiver
exclude from our restrictive covenants applicable to capital expenditures up to $85 million
relating to future capital improvement needs for our No. 8 coke battery. The $85 million for the
No. 8 coke battery and up to $35 million to be held in the segregated cash account for capital
expenditures are also excluded from the computation of our consolidated fixed charge coverage
ratio. The amendment and waiver also limits us from having borrowings, including outstanding
letters of credit, in excess of $150 million under our revolving credit facility. The amendment
and waiver also provides for a 75 basis point reduction in the interest rate spread for the loans
in which the interest rate is based upon the prime rate and a 120 basis point reduction in the
interest rate spread for the loans in which the interest rate is based upon the LIBOR rate with
respect to tranche B of the term loan, under which $198.7 million in principal amount was
outstanding as of December 31, 2004. Pursuant to the provisions of our term loan agreement, we are subject to, and are currently in
compliance with, various covenants, including compliance with the terms and conditions of the
guarantee of the Steel Board and the related guarantee of the West Virginia Housing Development
Fund, limitations on indebtedness, guaranty obligations, liens, sale of subsidiary stock,
dividends, distributions and investments. Our term loan agreement also specifies certain financial covenants, including a maximum leverage
ratio, minimum interest coverage ratio and minimum fixed charge coverage ratio with which we must
comply commencing with the quarter ending March 31, 2005. These financial covenants did not apply
prior to that date as long as we maintained minimum availability under our revolving credit
facility of at least $50 million through December 31, 2004. Our minimum availability amounted to
$131.3 million as of December 31, 2004. Additionally, had
these financial covenants been applicable, we would have been in
compliance with these financial covenants as of December 31, 2004. Whether we will be
able to meet such covenants in future periods will
substantially depend on our performance and the market conditions in the steel industry at the time
we are required to comply with such covenants. Our term loan agreement also limits our ability to incur certain capital expenditures, including
obligations under capital leases and capitalized repairs and replacements. Under our term loan
agreement, we are permitted to incur capital expenditures with respect to certain specified
projects up to specified maximum amounts, including the EAF, an automatic roll changer system at
our Mingo Junction facility, and the Allenport cold mill
improvements. In addition, the amendment and waiver permits us to incur capital expenditures with respect to the
rebuild of the No. 8 coke battery in an amount not to exceed $85 million. We are further permitted
to incur additional expenses for capital improvements for other projects in amounts not to exceed
in the aggregate specified maximums for each calendar year, ranging from $33.9 million to $44
million. $225 million revolving credit facility In connection with our plan of reorganization, WPSC entered into a three-year $225 million senior
secured revolving credit facility with a bank group arranged by Royal Bank of Canada and General
Electric Capital Corporation. Interest on borrowings is calculated based on either LIBOR or the
prime rate using spreads based on facility borrowing availability as defined in the agreement. The
facility matures on August 1, 2006. At December 31, 2004, there were no borrowings under the
revolving credit facility, and we had $131.3 million of availability, after giving effect to
required reserves, outstanding letters of credit and the a $150 million maximum availability
limitation under the facility. We are subject to, and are currently in compliance with, various
covenants set forth in the revolving credit agreement, which are substantially similar to those
contained in the term loan agreement, as amended, as described above. Under the terms of our
amended term loan agreement, we are limited to a maximum of $150 million in borrowings, including
outstanding letters of credit, under our revolving credit facility. Similar to the term loan agreement, we negotiated an amendment to our revolving credit facility.
Under the amendment, all proceeds up to $35 million that are allocated for capital expenditures
will be held in a segregated cash account. The amendment also permits us to incur an additional
$85 million in capital expenditures toward the rebuild of the No. 8 coke battery. Of the $85
million available for the No. 8 coke battery, only $18 million may be expended prior to January 1,
2006. The $85 million for the No. 8 coke battery and up to $35 million to be held in a segregated
cash account for capital expenditures are also excluded from the computation of our consolidated
fixed charge coverage ratio. On September 21, 2004, we sold 3,719,898 shares of common stock at an
offering price of $29 per share, generating gross sales proceeds of $107.9 million. These
proceeds, net of issuance costs, were used 33




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to repay the outstanding indebtedness under our
revolving credit facility in the amount of $92.7 million and to fund a restricted cash account in
the amount of $7.0 million to be used to fund future capital expenditures. $40 million Series A notes On August 1, 2003, pursuant to our plan of reorganization, WPSC issued Series A secured notes in
the aggregate principal amount of $40 million in settlement of claims under our bankruptcy
proceedings. The Series A notes were issued under an indenture among WPSC, WPC, WP Steel Venture
Corporation and J. P. Morgan Trust Company, National Association, the successor trustee to Bank
One, N.A. The Series A notes mature on August 1, 2011 and have no fixed amortization, meaning that
except for mandatory prepayments, based on excess cash flow or proceeds from the sale of joint
venture interests, no payment of principal shall be required until such notes become due. The
Series A notes bear interest at a rate of 5% per annum until July 1, 2008. Thereafter, such notes
bear interest at a rate of 8% per annum. In the event that at any time the distributions from
Wheeling-Nisshin. and OCC to WPSC are not adequate to pay all the interest then due under the
Series A notes or WPSC is not in compliance with the terms of the term loan agreement or revolving
credit facility, WPSC must pay both cash interest and payment-in-kind interest at rates set forth
in the Series A notes. OCC is restricted from declaring dividends under the terms of its credit
agreement with Bank of America, N.A. However, OCC is permitted to make distributions of interest
and principal in respect of its indebtedness to WPC, subject to certain limitations set forth in
its credit agreement and its subordination agreement. We are subject to, and are currently in
compliance with, various covenants set forth in the Series A note indenture, including payment of
principal and interest on the Series A notes, and limitations on additional indebtedness, creation
of liens, disposition of interests in Wheeling-Nisshin or OCC, and payments of dividends and
distributions. $20 million Series B notes On August 1, 2003, pursuant to our plan of reorganization, WPSC issued Series B secured notes in
the aggregate principal amount of $20 million in settlement of claims under our bankruptcy
proceedings. The Series B notes were issued under an indenture among WPSC, WPC, WP Steel Venture
Corporation and J. P. Morgan Trust Company, National Association, the successor trustee to Bank
One, N.A. The Series B notes mature on August 1, 2010 and have no fixed amortization, meaning that
no payment of principal shall be required until such notes become due. The Series B notes bear
interest at a rate of 6% per annum to the extent interest is paid in cash. In the event that WPSC
is not in compliance with the terms of the term loan agreement, the revolving credit facility or
the Series A notes or WPSCs excess cash flow (as defined in the Series B indenture) is
insufficient to cover any or all interest payments then due under the Series B notes, WPSC must pay
both cash interest and payment-in-kind interest at rates set forth in the Series B notes. We are
subject to, and are currently in compliance with, various covenants under the Series B note
indenture, which are substantially similar to many of those contained in the Series A note
indenture. $10 million unsecured note On August 1, 2003, pursuant to our plan of reorganization, WPSC issued an unsecured note in the
aggregate principal amount of $10 million to WHX Corporation. In July 2004, the WHX note was sold
by WHX to a third party. The unsecured note bears interest at 6% per annum, matures in 2011 and has
no fixed amortization, meaning that no payment of principal shall be required until such note
becomes due. If cash interest is not paid, WPSC must pay payment-in-kind interest. Such note is
subordinated in right of payment to our credit agreements, the Series A notes and the Series B
notes OFF-BALANCE SHEET ARRANGEMENTS As of December 31, 2004, we had no off-balance sheet transactions, arrangements, or other
relationships with unconsolidated entities or persons that are reasonably likely to adversely
affect liquidity, availability of capital resources, financial position or results of operations.
We have investments in three joint ventures, Wheeling-Nisshin and OCC and Feralloy-Wheeling
Specialty Processing Co., that are each accounted for under the equity method of accounting.
Pursuant to agreements with Wheeling-Nisshin. and OCC, we have an obligation to support their
working capital requirements. However, we believe it is unlikely that those joint ventures will
require our working capital support in the foreseeable future based upon the present financial
condition, capital resource needs and/or operations of these entities. 34




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##### Table of Contents



CERTAIN OTHER OBLIGATIONS In connection with the implementation of our plan of reorganization, we reached agreements with
various parties to defer payments of indebtedness and reduce costs in order to preserve liquidity
upon emergence from bankruptcy. These agreements include:  
    Modification and assumption agreement between WPSC and Danieli Corporation. This
agreement modifies an agreement between WPSC and Danieli Corporation, dated July 6, 2000,
pursuant to which WPSC agreed to purchase from Danieli Corporation certain roll-changing
equipment. Under the original agreement, WPSC owed approximately $7.36 million to Danieli
Corporation. Pursuant to the modified agreement, WPSC paid Danieli Corporation
approximately $2.36 million. Approximately $3.8 million of the balance of the amount owed
to Danieli Corporation was converted into a portion of the secured term loans under our
term loan agreement that is not guaranteed by the Steel Board. The balance of the amount
owed to Danieli Corporation was converted into a promissory note. In addition, WPSC agreed
to pay Danieli Corporation approximately $2.58 million (of which approximately $679,000 has
been paid as of December 31, 2004, and the balance of which is to be paid in progress
payments as work on the automatic roll changers project is completed, which is expected in
2005) to complete the roll-changing project and for rehabilitation, storage and other costs
of Danieli Corporation.
    Loan modification agreement between WPSC and the Ohio Department of Development. Under
this agreement, we made a $2.0 million partial prepayment of the $6.985 million owed by
WPSC to the Ohio Department of Development pursuant to a loan, dated as of January 18,
2002, from the Ohio Department of Development and we were granted a two-year deferral from
the effective date of the plan of reorganization of $4.985 million of such loan at an
interest rate of 3% per annum.
    Loan agreement between WPSC and the State of West Virginia. In connection with WPSCs
repayment of a $5 million loan from the West Virginia Development Office, WPSC has entered
into a $6.5 million loan agreement with the State of West Virginia. The loan has a
five-year term due August 1, 2008, and bears interest at a rate of approximately 5.6% per
annum.
    Agreement among WPSC, Itabira Rio Doce Company, Ltd. and Rio Doce Limited. This
agreement provides for repayment, in equal monthly installments over a period not to exceed
eighteen months from May 1, 2003, of WPSCs $5.1 million deferred payment obligation under
a certain iron ore sales
agreement dated October 1, 2001. The obligation was repaid, in full, during 2004 and no
amounts remain outstanding pursuant to this agreement. In addition, we have ongoing funding obligations under our labor agreement with the USWA.
Effective May 31, 2004, USWA wage rates increased by approximately 5.8%. In addition, a 12%
temporary wage reduction that had been in effect since May 2003 was eliminated. We also increased
wages for our salaried employees by 5% effective June 1, 2004. During 2005, under our labor
agreement with the USWA, an 8% wage increase will take effect in May 2005, with an additional 3%
wage increase taking effect in September 2005. All of the obligations referenced in this section,
except for the increase in wage rates, are included in the table of contractual commitments set
forth below. CONTRACTUAL COMMITMENTS As of December 31, 2004, the total of our future contractual obligations, including the repayment
of debt obligations, is summarized below. 35




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##### Table of Contents



Contractual Payments Due(Dollars in millions)2006 to
    
    
    2008 toTotal
    
    
    
    
    2005
    
    
    2007
    
    
    2009
    
    
    ThereafterLong-term debt (1)
    
    $
    326.7
    
    
    
    
    $
    30.7
    
    
    $
    51.8
    
    
    $
    170.2
    
    
    $
    74.0Capital leases (1)
    
    
    7.0
    
    
    
    
    
    0.7
    
    
    
    1.3
    
    
    
    1.2
    
    
    
    3.8Long-term operating leases (2)
    
    
    22.3
    
    
    
    
    
    3.9
    
    
    
    5.0
    
    
    
    4.9
    
    
    
    8.5Other long term liabilities:Steelworker Pension Trust
    
    
    14.3
    
    (3
    )
    
    
    3.9
    
    
    
    7.8
    
    
    
    2.6
    
    
    
    OPEB
    
    
    22.8
    
    (4
    )
    
    
    3.7
    
    
    
    8.6
    
    
    
    10.5
    
    
    
    Severance
    
    
    14.5
    
    (5
    )
    
    
    8.7
    
    
    
    4.3
    
    
    
    1.4
    
    
    
    0.1Coal miner retiree medical
    
    
    4.7
    
    
    
    
    
    0.3
    
    
    
    0.5
    
    
    
    0.5
    
    
    
    3.4Workers compensation
    
    
    34.5
    
    (6
    )
    
    
    6.9
    
    
    
    13.8
    
    
    
    13.8
    
    
    
    Special bonus payment
    
    
    10.0
    
    (7
    )
    
    
    5.0
    
    
    
    5.0
    
    
    
    
    
    
    
    Purchase commitments:Oxygen supply
    
    
    71.4
    
    (8
    )
    
    
    7.2
    
    
    
    14.4
    
    
    
    14.4
    
    
    
    35.4Electricity
    
    
    67.2
    
    (9
    )
    
    
    4.8
    
    
    
    9.6
    
    
    
    9.6
    
    
    
    43.2Coal
    
    
    28.8
    
    (10
    )
    
    
    9.6
    
    
    
    19.2
    
    
    
    
    
    
    
    Capital commitments
    
    
    27.5
    
    (11
    )
    
    
    27.5
    
    
    
    
    
    
    
    
    
    
    
    Total
    
    $
    651.7
    
    
    
    
    $
    112.9
    
    
    $
    141.3
    
    
    $
    229.1
    
    
    $
    168.4
   1.
    
    See Note 13 to Consolidated Financial
Statement in Item 8  Financial Statements and
Supplementary Data..2.
    
    See Note 14 to Consolidated Financial
Statements in Item 8  Financial Statements and
Supplementary Data.3.
    
    Amount represents estimated payments to the Steelworkers Pension Trust, pursuant to our
labor agreement with the USWA, through the end of the labor contract, which expires on
September 1, 2008.4.
    
    Amounts reflect our current estimate of corporate cash outflows for other post
employment benefits and include the impact of assumed mortality, medical inflation and the
aging of the population. No estimate has been made beyond 2009.5.
    
    Amount represents payments under employee buyout program. 650 bargaining employees
elected buyouts that extend through 2010.6.
    
    Amounts reflect our current estimate of corporate cash outflows and exclude the impact
of interest and mortality. The forecast of cash outflows is estimated based on historical
cash payment information for the period 2002 through 2004 and anticipates payment of
approximately $6.9 million per year. No estimate has been made beyond 2009.7.
    
    Special Bonus Program was established in the 2003 Modified Labor Agreement to recognize
the unique contributions and sacrifices made by the hourly workforce and their Union in
helping to keep the Company operating during the Bankruptcy. Payments of $5.0 million are
to be made on December 15, 2005 and 2006.8.
    
    We entered into a 15-year take-or-pay contract in 1999 that was amended in 2003. The
contract requires us to purchase oxygen, nitrogen and argon each month with a minimum
monthly charge of approximately $0.6 million, subject to escalation clauses.9.
    
    We entered into a 20-year take-or-pay contract in 1999, which was amended in 2003. The
contract requires us to purchase steam and electricity each month or pay a minimum monthly
charge of approximately $0.4 million. A variable portion of the contract is calculated as
$3.75 times the number of tons of iron produced each month with an agreed to minimum of
3,000 tons per day. At December 31, 2004, a maximum termination payment of $33.4 million
would have been required.10.
    
    In 2004,we amended our take-or-pay contract to purchase coal each month to a minimum
monthly charge of approximately $1.6 million. The term of the contract expires on December
31, 2007, while the Company has the sole option to terminate the contract on or after
January 1, 2006. After such date, the pricing will be subject to market conditions with a
cap collar. At December 31, 2004, a maximum termination payment of $7.6 million would have
been required.11.
    
    Amounts reflect contractual commitments for capital expenditure as of December 31,
2004. 36




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##### Table of Contents



Planned capital expenditures Our planned capital expenditures for the three-year period 2005 through 2007 total approximately
$267.3 million, and include, but are not limited to, the following capital expenditure projects:  
    $1.9 million remaining to be spent on the EAF;
    $77.3 toward completion of a rebuild of the No. 8 coke battery, which is expected to extend the service life by 12 to
15 years, and is expected to begin in 2005 and be completed in mid 2006 (although, see Business  Recent
Developments regarding the proposed joint venture);
    $14.5 million for installation of hot strip mill automatic roll changers at our Mingo Junction facility, expected to
occur in 2005; and
    $9.8 million for cold mill improvements at our Allenport facility, expected to occur in 2005 and 2006. In addition to the planned capital expenditure amounts identified above, we are also contemplating,
at our option, a complete rebuild of the Nos. 1, 2 and 3 coke batteries in 2008 and 2009, at an
estimated aggregate cost of approximately $47.0 million. Our decision to rebuild these coke
batteries will depend, in part, on whether we believe potential revenues from the sale of resulting
excess coke production attributable to the continued operation of these three batteries justifies
these expenditures. (See potential joint venture described in Business  Recent Developments). Under our credit agreements, we are permitted to undertake the construction of the EAF, No. 8 coke
battery rebuild, hot strip mill automatic roll changer installation and cold mill improvements,
subject to pre-established spending limits provided in our restrictive covenants. These covenants
also limit the amounts that we can spend on any other capital expenditure projects undertaken in
2005, and 2006 to $44.0 million, and $37.1 million, respectively, subject to adjustment for
permitted carryover of a portion of any unexpended amounts in these and prior years. During the year ended December 31, 2004, we spent approximately $132.4 million on capital
expenditures, including $95.9 million on our EAF, $81.6
million of which was funded through our restricted cash account. VEBA TRUST AND PROFIT SHARING PLANS Below are summaries of our contribution obligations under the VEBA trust and our two profit sharing
plans, one for our USWA-represented employees and the other for our salaried employees, excluding
our officers. Our future obligations, if any, under the VEBA trust and these plans are subject to
and based on the level of our profitability (as described below) for each completed quarter. In
addition, we have discretion, to the extent provided by the terms of the agreement establishing the
VEBA trust and the terms of the profit sharing plans, to satisfy some or all of our funding
obligations with shares of our common stock or cash. During 2004, we incurred aggregate obligations under the VEBA trust and the profit sharing plans of
$39.3 million. Of this amount $13.0 million was settled with pre-funded amounts. Of the remaining
$26.3 million, $21.3 million was settled in common stock, $3.3 million was settled in cash and $1.7
million is expected to be settled in common stock in the first quarter of 2005. VEBA Trust In connection with our plan of reorganization and our collective bargaining agreement with the
USWA, we established a plan to provide health care and life insurance benefits to certain retirees
and their dependents. The collective bargaining agreement also required us to create and make
contributions to a trust to fund the payment of these retiree benefits. The trust, referred to
herein as the VEBA trust, is designed to constitute a tax-exempt voluntary employee beneficiary
association under Section 501(c)(9) of the Internal Revenue Code. Pursuant to our plan of
reorganization, we issued 4,000,000 shares of WPC common stock to the VEBA trust (the Initial
Shares). Due to certain restrictions on the VEBA trusts ability to sell stock held by the trust
to fund benefit payments (which are described in more detail below), the agreement with the USWA
provided for monthly cash contributions by us of $1.5 million, beginning in October 2003 and
continuing through February 2004, and $0.3 million from April 2004 through September 2004 for a
total of $9.3 million (collectively, the Initial Funding
Obligation). In addition, the agreement provides for ongoing contributions based on our
profitability, payable within 45 days of the end of each fiscal quarter, under the following
formula (collectively, the Variable Contributions): 37




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(i)
    40% of operating cash flow, between $16 and $24 of operating cash flow per ton of steel
products sold to third parties, payable in cash;(ii)
    12% of operating cash flow, between $24 and $65 of operating cash flow per ton of steel
products sold to third parties, payable at our discretion in cash or common stock of WPC;(iii)
    25% of operating cash flow, above $65 of operating cash flow per ton of steel products
sold to third parties, payable in cash; and(iv)
    15% of operating cash flow below $30 of operating cash flow per ton of steel products
sold to third parties, payable at our discretion in cash or common stock of WPC, subject to
compliance with dilution limitations. During 2004, variable contributions of $22.9 million were incurred. Of this amount, $13.0 million
was satisfied with pre-funded amounts. Of the remaining $9.9 million, $4.9 million was settled by
contributing an aggregate 169,622 shares of common stock, $3.3 million was settled in cash and
$1.7 million is expected to be settled in common stock in the first quarter of 2005. Operating cash flow, for purposes of determining Variable Contributions, is defined as our
earnings before interest and taxes, adjusted for certain amounts as set forth in the agreement with
the USWA (primarily unusual, extraordinary or non-recurring items). Previously, we contributed $3.0 million, in cash, to the VEBA trust toward satisfaction of the
Initial Funding Obligation. In March 2004, we agreed with the USWA to satisfy the Initial Funding
Obligation, as follows:  
    the trustee was authorized to sell up to 400,000 of the Initial Shares, at its discretion;
    the proceeds of the sale of 400,000 of the Initial Shares, not to exceed $6.3 million, and the $3.0 million cash
contribution previously made will be credited, over a limited period of time, against future Variable Contributions due
under (i), (ii) and (iii) of the Variable Contribution formula described above, if any, in accordance with the terms of
the agreement with the USWA;
    the proceeds of the sale of 400,000 shares of the Initial Shares in excess of $6.3 million, if any, will be creditable,
at our discretion against future Variable Contributions, if any are required under (i), (ii) and (iii) of the Variable
Contribution formula described above; and
    no later than February 14, 2008, we are required to contribute 400,000 additional shares of our common stock to the
trust, minus any shares of our common stock contributed prior to that date under (ii) of the Variable Contribution
formula described above. To the extent that contributions become due under (ii) of the Variable Contribution formula
described above and we decide to make such contributions in stock, we have discretion to apply up
to 1.6 million of the Initial Shares as a credit, share for share, against future stock
contribution amounts to the trust. Shares of WPC common stock contributed to the trust in
satisfaction of, or in the case of Initial Shares applied as a credit against, our obligations, are
valued based on the closing price of WPC common stock for the 10 trading days immediately preceding
the date of contribution. Pursuant to a Stock Transfer Restriction and Voting Agreement, the trustee of the VEBA trust has
agreed to limit the number of shares of WPC common stock that it may sell during the four years
following the effective date of our plan of reorganization. During the first two years, the VEBA
trust is not permitted to sell any of the Initial Shares without our authorization unless it holds,
at the time of such sale, fewer than five percent of our outstanding
shares of common stock. During each of the following two years, the VEBA trust has agreed not to
sell more than 50% of the remaining Initial Shares within any consecutive 12-month period. These
restrictions will not apply to any additional shares that we may contribute to the VEBA trust in
satisfaction of our Variable Contribution obligation, if any. As described above, we authorized
the disposition of 400,000 shares of our common stock held by the VEBA trust in satisfaction of
certain funding obligations with respect to the trust (all of which had been 38




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disposed by the VEBA
trust as of September 30, 2004). In connection with the stock transfer restrictions, the VEBA
trust has also agreed that it will abstain from voting 1.3 million shares of common stock, or such
lesser number of shares as it may hold from time to time, for the election of directors of WPC. Profit sharing plans Pursuant to the collective bargaining agreement with the USWA, and in addition to our obligations
to make contributions to the VEBA trust based on our profitability as described under VEBA Trust
above, we have an obligation to make quarterly profit sharing payments to or for the benefit of our
active USWA employees in an amount equal to 15% of our profits for the quarter, if any, in excess
of $30 profit per ton of steel shipped to third parties. For this purpose, profits are defined as
earnings before interest and taxes, calculated on a consolidated basis, excluding effects of
certain amounts as set forth in the collective bargaining agreement. The profit sharing pool will
be divided among all employees on the basis of hours attributed to each employee within each
quarter. We have the discretion to make future payments, if any, in cash or in WPC common stock.
Under the terms of the plan, we must satisfy any profit sharing obligation with respect to the
first, second and third fiscal quarters within 45 days after the end of the quarter, while any
obligation with respect to the fourth fiscal quarter must be satisfied within 15 days after the
date of the opinion of our independent registered public accounting firm with respect to our annual
audited financial statements. All payments in stock will be contributed to the participants
401(k) account, while payments in cash, if any, will be made directly to plan participants. To the
extent that contributions of stock under this plan in any fiscal year, together with stock
contributions to the VEBA trust under (iv) of the Variable Contribution formula described under
VEBA trust above, exceed 10% of our common stock, on a fully diluted basis, we may satisfy our
contribution obligation in the form of profit sharing notes. All profit sharing payments that
become due are considered 100% vested when made. During 2004, we incurred a profit sharing obligation under this plan of $12.8 million. This amount
was settled by contributing an aggregate 427,118 shares of common stock. In addition, we have adopted a profit sharing plan for salaried employees under which we have an
obligation to make quarterly profit sharing payments to or for the benefit of our salaried
employees in an amount equal to 4.19% of our profits for the quarter, if any, in excess of $30
profit per ton of steel shipped to third parties. For this purpose, profits are defined as
earnings before interest and taxes, calculated on a consolidated basis, excluding effects of
certain amounts as set forth in the plan. The profit sharing pool will be divided among all
salaried employees, excluding officers. During 2004, a profit sharing obligation of $3.6 million was incurred under this plan. This amount
was settled by contributing an aggregate of 120,585 shares of common stock. Under the terms of
the plan, we must satisfy any profit sharing obligations with respect to the first, second and
third fiscal quarters within 45 days after the end of the quarter, while any obligation with
respect to the fourth quarter must be satisfied within 15 days after the date of the opinion of our
independent registered public accounting firm with respect to our annual audited financial
statements. All payments in stock will be contributed to the company stock fund (as defined in our
salaried 401(k) savings plan) under our salaried 401(k) savings plan, which restricts participants
from making dispositions of our common stock out of the fund for a period of 24 months following
any contribution other than distributions following termination of employment, or the death or
disability of the participant. All profit sharing payments that become due are considered 100%
vested when made. RECENT ACCOUNTING STANDARDS Under the provisions of SOP 90-7, the Company was required to adopt, as of July 31, 2003, all
accounting guidance that was going to be effective within a twelve-month period. The Financial Accounting Standards Board (FASB) issued FASB Interpretation (FIN) No. 46R,
Consolidation of Variable Interest Entities, in December 2003. Additionally, the FASB issued
several FASB Staff Positions during
2004, addressing, clarifying and amplifying FIN46. FIN 46R is effective for all variable interest
entities, other than special-purpose entities, for periods ending after March 15, 2004. This
interpretation and the related staff positions had no effect on the financial statements of the
Company. The Company adopted FASB No. 132-R (revised 2003), Employers Disclosures about Pensions and Other
Postretirement Benefits an amendment of FASB Statements No. 87,
88, and 106 (FASB 132-R). FASB
132-R 39




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revises employers disclosures about pension plans and other postretirement benefit plans.
These disclosures are provided in Note 15. The FASB issued FASB Staff Position (FSP) No. 106-2, Accounting and Disclosure Requirements
Related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003, in May 2004.
Based on a preliminary assessment of final guidance on determining actuarial equivalence, the
Company has assumed that its prescription drug benefits will not be actuarially equivalent to the
prescription drug benefits under Medicare Part D. The FASB issued FSP No. 109-1, Application of FASB Statement No. 109, Accounting for Income
Taxes",to the Tax Deduction on Qualified Production Activities Provided by the American Jobs
Creation Act of 2004 in December 2004. FSP No. 109-1 requires the tax deduction provided by this
tax act to be accounted for as a special deduction under FASB No. 109. The Company adopted this
staff position and incorporated the related effects in computing tax expense and related tax assets
and liabilities for 2004. The FASB issued FASB No. 123®, Share-Based Payment, in December 2004. FASB No 123® requires
employers to value share-based payments using the fair value method, eliminating the option to use
the intrinsic method to value such payments. FASB No. 123® is effective for the third quarter of
2005. Due to the immaterial number of share-based payments made by the Company, the Company does
not expect this statement to have a material impact on its financial statements. The FASB issued FASB No. 151, Inventory Costs, an amendment of ARB No. 43, Chapter 4, in December
2004. FASB No. 151 requires that abnormal amounts of idle facility expense, freight, handling
costs and wasted materials be recognized as current-period costs and not as inventoriable costs.
FASB No. 151 is effective for fiscal years beginning after June 15, 2005. The Company does not
expect this statement to have a material impact on its financial statements. 
 Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Our quantitative and qualitative disclosures about market risk include forward-looking statements
with respect to managements opinion about the risk associated with our financial instruments.
These statements are based on certain assumptions with respect to market prices, interest rates and
other industry-specific risk factors. To the extent these assumptions prove to be inaccurate,
future outcomes may differ materially from those discussed herein. Commodity price risk and related risks In the normal course of business, our company is exposed to market risk or price fluctuation
related to the purchase, production or sale of steel products. In addition, prices for our raw
materials, natural gas and electricity requirements are subject to frequent market fluctuations.
Our companys market risk strategy generally has been to obtain competitive prices for our products
and services and to allow operating results to reflect market price movements dictated by supply
and demand. Additionally, we periodically enter into contracts for the advance purchase of natural
gas in an effort to hedge against market fluctuations. Due to mark to market provisions in these
contracts, as our market exposure decreases, we can be required to make advance payments that
ultimately are recovered upon delivery of the commodity, but which can temporarily reduce our
liquidity until that time. Interest rate risk The fair value of cash and cash equivalents, receivables and accounts payable approximate their
carrying values and are relatively insensitive to changes in interest rates due to their short-term
maturity. Under the Bankruptcy Code, interest is generally not allowable on unsecured pre-petition
obligations. Pursuant to our plan of reorganization, substantially all of our pre-reorganization
debt was repaid or otherwise satisfied and we entered into the term loan agreement and revolving
credit facility. At December 31, 2004, we had
approximately 70% of the aggregate principal amount of debt under fixed-rate instruments with the
balance under variable-rate instruments. Since our portfolio of debt is comprised primarily of
fixed-rate instruments, the fair value of the debt is relatively sensitive to the effects of
interest rate fluctuations. However, our interest expense is insensitive to changes in the general
level of interest rates. A 100 basis point 40




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increase in the average rate for the variable-rate debt
would increase our annual interest expense by approximately $1.0 million. Credit risk Counter parties expose our company to credit risk in the event of non-performance. We continually
review the creditworthiness of our counter-parties. Foreign currency exchange risk Our company has limited exposure to foreign currency exchange risk as almost all of our
transactions are denominated in U.S. dollars. 
 Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The Companys financial statements from and after the effective date of the plan of reorganization
August 1, 2003, are those of a new reporting entity (Reorganized Company) and are not comparable to
the pre-confirmation periods of the old reporting entity (Predecessor Company). As a result, the
independent registered public accounting firm
prepared two reports, one for the financial statements of the Reorganized Company and the other for
the financial statements of the Predecessor Company. Managements Report on Internal Control Over Financial Reporting. Management of Wheeling-Pittsburgh Corporation (the Company) is responsible for establishing and
maintaining adequate internal control over financial reporting. The Companys internal control
over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles. The Companys internal control over financial reporting includes policies and procedures that (1)
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect
transactions and dispositions of assets; (2) provide reasonable
assurance that transactions are
recorded as necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures are being made only in
accordance with authorizations of management and the directors of the Company; and (3) provide
reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or
disposition of the Companys assets that could have a material effect on our financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or
detect misstatements. Also, projections of any evaluation of effectiveness to future periods are
subject to the risk that controls may become inadequate because of changes in conditions, or that
the degree of compliance with the policies or procedures may deteriorate. Management assessed the effectiveness of the Companys internal control over financial reporting as
of December 31, 2004. In making this assessment, management used the criteria set forth by
the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control -
Integrated Framework. Based on our assessment and those criteria, management has concluded that
the Company maintained effective internal control over financial reporting as of December 31, 2004. The Companys independent registered public accounting firm has audited and issued their report on
managements assessment of the Companys internal control over financial reporting, and the report
is set forth in the Report of Independent Registered Public Accounting Firm which is included
below. 41




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Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of
Wheeling-Pittsburgh Corporation: We have completed an integrated audit of Wheeling-Pittsburgh Corporations 2004 consolidated
financial statements and of its internal control over financial reporting as of December 31, 2004
and an audit of its consolidated financial statements for the period from August 1, 2003 to
December 31, 2003 in accordance with the standards of the Public Company Accounting Oversight Board
(United States). Our opinions, based on our audits, are presented below. Consolidated financial statements In our opinion, the accompanying consolidated balance sheets and the related consolidated
statements of operations, cash flows, and changes in stockholders equity present fairly, in all
material respects, the financial position of Wheeling-Pittsburgh Corporation and its subsidiaries
(Reorganized Company) at December 31, 2004 and 2003, and the results of their operations and their
cash flows for the year ended December 31, 2004 and for the period from August 1, 2003 to December
31, 2003 in conformity with accounting principles generally accepted in the United States of
America. These financial statements are the responsibility of the Reorganized Companys
management. Our responsibility is to express an opinion on these financial statements based on our
audits. We conducted our audits of these statements in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit of financial statements includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a reasonable basis for our
opinion. As discussed in Note 2 to the consolidated financial statements, the United States Bankruptcy Court
for the Northern District of Ohio confirmed the Reorganized Companys Third Amended Joint Plan of
Reorganization (the Plan) on June 18, 2003. Confirmation of the Plan resulted in the discharge of
all claims against the Reorganized Company that arose before November 16, 2000 and substantially
alters or terminates all rights and interests of equity security holders as provided for in the
Plan. The Plan was substantially consummated on August 1, 2003 and the Reorganized Company emerged
from bankruptcy. In connection with its emergence from bankruptcy, the Reorganized Company adopted
fresh start accounting as of August 1, 2003. Internal control over financial reporting Also, in our opinion, managements assessment, included in the accompanying Managements Report
on Internal Control Over Financial Reporting that the Reorganized Company maintained effective
internal control over financial reporting as of December 31, 2004 based on criteria established
in Internal Control  Integrated Frameworkissued by the Committee of Sponsoring Organizations of
the Treadway Commission (COSO) is fairly stated, in all material respects, based on those
criteria. Furthermore, in our opinion, the Reorganized Company maintained, in all material
respects, effective internal control over financial reporting as of December 31, 2004, based on
criteria established in Internal Control  Integrated
Frameworkissued by the COSO. The Reorganized
Companys management is responsible for maintaining effective internal control over financial
reporting and for its assessment of the effectiveness of internal control over financial
reporting. Our responsibility is to express opinions on managements assessment and on the
effectiveness of the Reorganized Companys internal control over financial reporting based on our
audit. We conducted our audit of internal control over financial reporting in accordance with
the standards of the Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether effective
internal control over financial reporting was maintained in all material respects. An audit of
internal control over financial reporting includes obtaining an understanding of internal control
over financial reporting, evaluating managements assessment, testing and evaluating the design
and operating effectiveness of internal control, and
performing such other procedures as we consider necessary in the circumstances. We believe that
our audit provides a reasonable basis for our opinions. 42




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A companys internal control over financial reporting is a process designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles. A
companys internal control over financial reporting includes those policies and procedures that (i)
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that
transactions are recorded as necessary to permit preparation of financial statements in accordance
with generally accepted accounting principles, and that receipts and expenditures of the company
are being made only in accordance with authorizations of management and directors of the company;
and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the companys assets that could have a material effect on the
financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or
detect misstatements. Also, projections of any evaluation of effectiveness to future periods are
subject to the risk that controls may become inadequate because of changes in conditions, or that
the degree of compliance with the policies or procedures may deteriorate. /s/ PricewaterhouseCoopers LLP
Pittsburgh, Pennsylvania
March 9, 2005 43




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Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of
Wheeling-Pittsburgh Corporation: In our opinion, the accompanying consolidated statements of operations, cash flows, and changes in
stockholders equity present fairly, in all material respects, the results of operations and cash
flows of Wheeling-Pittsburgh Corporation and its subsidiaries (Predecessor Company) and their cash
flows for the period from January 1, 2003 to July 31, 2003, and for the year ended December 31,
2002 in conformity with accounting principles generally accepted in the United States of America.
These financial statements are the responsibility of the Companys management. Our responsibility
is to express an opinion on these financial statements based on our audits. We conducted our audits
of these statements in accordance with the standards of the Public Company Accounting Oversight
Board (United States). Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements, assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion. As discussed in Note 2 to the consolidated financial statements, the Company filed a petition on
November 16, 2000 with the United States Bankruptcy Court for the Northern District of Ohio for
reorganization under the provisions of Chapter 11 of the Bankruptcy Code. The Companys Third
Amended Joint Plan of Reorganization was substantially consummated on August 1, 2003 and the
Company emerged from bankruptcy. In connection with its emergence from bankruptcy, the Company
adopted fresh start accounting. /s/ PricewaterhouseCoopers LLP
Pittsburgh, Pennsylvania
March 9, 2004 44




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WHEELING-PITTSBURGH CORPORATION AND SUBSIDIARIESConsolidated Statements of Operations(Dollars in thousands, except per share amounts)
 Reorganized Company
    
    
    
    Predecessor CompanyYear
    
    
    Five Months
    
    
    
    Seven Months
    
    
    YearEnded
    
    
    Ended
    
    
    
    Ended
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002RevenuesNet sales, including sales to affiliates of
$367,735, $101,501, $164,273 and $258,681
    
    $
    1,405,794
    
    
    $
    396,902
    
    
    
    $
    570,439
    
    
    $
    979,993Cost and expensesCost of sales, including cost of sales to
affiliates of $324,813, $91,262, $143,840
and $238,937, excluding depreciation and
amortization expense
    
    
    1,206,773
    
    
    
    395,950
    
    
    
    
    563,832
    
    
    
    894,449Depreciation and amortization expense
    
    
    33,433
    
    
    
    10,473
    
    
    
    
    39,889
    
    
    
    74,194Selling, general and administrative expense
    
    
    67,257
    
    
    
    23,564
    
    
    
    
    29,906
    
    
    
    46,993Reorganization and professional fee expense
    
    
    
    
    
    
    (35
    )
    
    
    
    8,140
    
    
    
    11,755Total costs and expenses
    
    
    1,307,463
    
    
    
    429,952
    
    
    
    
    641,767
    
    
    
    1,027,391Operating income (loss)
    
    
    98,331
    
    
    
    (33,050
    )
    
    
    
    (71,328
    )
    
    
    (47,398
    )Interest expense and other financing costs
    
    
    (19,778
    )
    
    
    (10,215
    )
    
    
    
    (9,185
    )
    
    
    (15,987
    )Other income
    
    
    17,520
    
    
    
    4,350
    
    
    
    
    3,228
    
    
    
    4,567Reorganization income (expense):Fair value adjustments
    
    
    
    
    
    
    
    
    
    
    
    (152,708
    )
    
    
    Gain on discharge of indebtedness
    
    
    
    
    
    
    
    
    
    
    
    557,541
    
    
    
    Other
    
    
    
    
    
    
    
    
    
    
    
    (4,758
    )
    
    
    1,262Income (loss) before income taxes
    
    
    96,073
    
    
    
    (38,915
    )
    
    
    
    322,790
    
    
    
    (57,556
    )Income tax provision (benefit)
    
    
    33,606
    
    
    
    15
    
    
    
    
    (641
    )
    
    
    11Net income (loss)
    
    $
    62,467
    
    
    $
    (38,930
    )
    
    
    $
    323,431
    
    
    $
    (57,567
    )Earnings per shareBasic
    
    $
    5.81
    
    
    $
    (4.10
    )
    
    
    
    *
    
    
    
    *Diluted
    
    $
    5.68
    
    
    $
    (4.10
    )
    
    
    
    *
    
    
    
    *Weighted average shares (in thousands):Basic
    
    
    10,759
    
    
    
    9,500
    
    
    
    
    *
    
    
    
    *Diluted
    
    
    11,002
    
    
    
    9,500
    
    
    
    
    *
    
    
    
    *
   *
    
    Prior to reorganization, the Company was a wholly-owned subsidiary of WHX Corporation (see Note 2) The accompanying notes are an integral part of the financial statements. 45




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WHEELING-PITTSBURGH CORPORATION AND SUBSIDIARIESConsolidated Balance Sheets(Dollars in thousands)
 December 31,2004
    
    
    2003AssetsCurrent assets:Cash and cash equivalents
    
    $
    31,198
    
    
    $
    4,767Trade receivables, less allowance for doubtful accounts
of $2,697 and $2,061
    
    
    144,509
    
    
    
    104,025Inventories
    
    
    156,669
    
    
    
    146,895Prepaid expenses and deferred charges
    
    
    29,953
    
    
    
    11,583Total current assets
    
    
    362,329
    
    
    
    267,270Investment in and advances to affiliated companies
    
    
    53,016
    
    
    
    42,857Property, plant and equipment, less accumulated
depreciation of $42,536 and $10,051
    
    
    487,308
    
    
    
    387,765Deferred income tax benefits
    
    
    18,751
    
    
    
    23,170Restricted cash
    
    
    12,502
    
    
    
    87,138Goodwill
    
    
    
    
    
    
    30,000Other intangible assets, less accumulated amortization
of $1,346 and $423
    
    
    5,174
    
    
    
    9,076Deferred charges and other assets
    
    
    16,279
    
    
    
    21,610Total assets
    
    $
    955,359
    
    
    $
    868,886Liabilities and stockholders equityCurrent liabilities:Trade payables
    
    $
    92,434
    
    
    $
    76,108Short-term debt
    
    
    
    
    
    
    79,251Payroll and employee benefits payable
    
    
    48,611
    
    
    
    57,862Accrued federal, state and local taxes
    
    
    10,073
    
    
    
    10,744Deferred income tax liabilities
    
    
    18,751
    
    
    
    23,170Accrued interest and other liabilities
    
    
    7,843
    
    
    
    9,672Long-term debt due in one year
    
    
    31,427
    
    
    
    2,698Total current liabilities
    
    
    209,139
    
    
    
    259,505Long-term debt
    
    
    302,156
    
    
    
    340,696Other employee benefit liabilities
    
    
    135,608
    
    
    
    142,433Other liabilities
    
    
    17,978
    
    
    
    21,639Total liabilities
    
    
    664,881
    
    
    
    764,273Stockholders equityCommon stock
 $.01 Par value; 14,437,223 and 10,000,000 shares
issued, 14,433,223 and 10,000,000 shares outstanding
    
    
    144
    
    
    
    100Additional paid-in capital
    
    
    270,784
    
    
    
    149,901Accumulated earnings (deficit)
    
    
    23,537
    
    
    
    (38,930
    )Deferred compensation
    
    
    (3,927
    )
    
    
    (6,458
    )Treasury stock, 4,000 shares, at cost
    
    
    (60
    )
    
    
    Total stockholders equity
    
    
    290,478
    
    
    
    104,613Total liabilities and stockholders equity
    
    $
    955,359
    
    
    $
    868,886
 The accompanying notes are an integral part of the financial statement. 46




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##### Table of Contents



WHEELING-PITTSBURGH CORPORATION AND SUBSIDIARIESConsolidated Statements of Cash Flows(Dollars in thousands)
 Reorganized Company
    
    
    
    Predecessor CompanyYear
    
    
    Five
    
    
    
    Seven
    
    
    YearEnded
    
    
    Months Ended
    
    
    
    Months Ended
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002Cash flows from operating activitiesNet income (loss)
    
    $
    62,467
    
    
    $
    (38,930
    )
    
    
    $
    323,431
    
    
    $
    (57,567
    )Adjustments to reconcile net income (loss) to cash
provided by (used in) operating activities:Depreciation and amortization expense
    
    
    33,433
    
    
    
    10,473
    
    
    
    
    39,889
    
    
    
    74,194VEBA and profit sharing expense paid in stock
    
    
    22,981
    
    
    
    
    
    
    
    
    
    
    
    
    Other postretirement benefits
    
    
    3,359
    
    
    
    (4,608
    )
    
    
    
    (1,565
    )
    
    
    (10,708
    )Deferred compensation and stock options
    
    
    2,474
    
    
    
    1,041
    
    
    
    
    
    
    
    
    Interest paid-in-kind
    
    
    2,384
    
    
    
    
    
    
    
    
    
    
    
    
    Equity income of affiliated companies, net
of dividends
    
    
    (11,884
    )
    
    
    (1,708
    )
    
    
    
    184
    
    
    
    (2,117
    )Loss on disposition of assets
    
    
    361
    
    
    
    
    
    
    
    
    
    
    
    
    Deferred income taxes
    
    
    32,632
    
    
    
    
    
    
    
    
    
    
    
    
    Reorganization income
    
    
    
    
    
    
    
    
    
    
    
    (400,075
    )
    
    
    (1,262
    )Changes in current assets and current liabilities:Trade receivables
    
    
    (40,484
    )
    
    
    8,391
    
    
    
    
    17,944
    
    
    
    (24,131
    )Inventories
    
    
    (9,774
    )
    
    
    7,769
    
    
    
    
    19,769
    
    
    
    (10,974
    )Other current assets
    
    
    (18,370
    )
    
    
    (5,012
    )
    
    
    
    918
    
    
    
    1,425Trade payables
    
    
    14,118
    
    
    
    (6,990
    )
    
    
    
    9,900
    
    
    
    9,749Other current liabilities
    
    
    (13,505
    )
    
    
    (11,874
    )
    
    
    
    (306
    )
    
    
    12,483Other assets
and other liabilities  net
    
    
    (8,167
    )
    
    
    6,190
    
    
    
    
    (9,902
    )
    
    
    (6,135
    )Net cash provided by (used in) operating activities
    
    
    72,025
    
    
    
    (35,258
    )
    
    
    
    187
    
    
    
    (15,043
    )Cash flows from investing activitiesPayments from affiliates
    
    
    1,725
    
    
    
    325
    
    
    
    
    600
    
    
    
    Capital expenditures
    
    
    (132,442
    )
    
    
    (37,828
    )
    
    
    
    (2,866
    )
    
    
    (10,971
    )Restricted cash used to fund capital expenditures
    
    
    74,636
    
    
    
    24,862
    
    
    
    
    
    
    
    
    Proceeds from sale of assets
    
    
    28
    
    
    
    
    
    
    
    
    201
    
    
    
    1,320Net cash used in investing activities
    
    
    (56,053
    )
    
    
    (12,641
    )
    
    
    
    (2,065
    )
    
    
    (9,651
    )Cash flows from financing activitiesNet change in short-term debt
    
    
    (79,251
    )
    
    
    42,336
    
    
    
    
    
    
    
    
    Short term debt (DIP facility) borrowings
    
    
    
    
    
    
    
    
    
    
    
    1,724
    
    
    
    8,286Book overdraft
    
    
    2,208
    
    
    
    3,157
    
    
    
    
    327
    
    
    
    957Borrowing of long-term debt
    
    
    3,000
    
    
    
    (209
    )
    
    
    
    (1,334
    )
    
    
    16,408Repayment of long-term debt
    
    
    (15,195
    )
    
    
    
    
    
    
    
    
    
    
    
    Issuance of common stock, net of issuance costs
    
    
    99,697
    
    
    
    
    
    
    
    
    
    
    
    
    Net cash provided by financing activities
    
    
    10,459
    
    
    
    45,284
    
    
    
    
    717
    
    
    
    25,651Increase (decrease) in cash and cash equivalents
    
    
    26,431
    
    
    
    (2,615
    )
    
    
    
    (1,161
    )
    
    
    957Cash and cash equivalents, beginning of period
    
    
    4,767
    
    
    
    7,382
    
    
    
    
    8,543
    
    
    
    7,586Cash and cash equivalents, end of period
    
    $
    31,198
    
    
    $
    4,767
    
    
    
    $
    7,382
    
    
    $
    8,543
 The accompanying notes are
an integral part of the financial statements. 47




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WHEELING-PITTSBURGH CORPORATION AND SUBSIDIARIESConsolidated Statement of Changes in Stockholders Equity(Dollars in thousands)
 Additional
    
    
    AccumulatedCommon
    
    
    Paid-in
    
    
    Earnings
    
    
    Deferred
    
    
    TreasuryStock
    
    
    Capital
    
    
    (Deficit)
    
    
    Compensation
    
    
    Stock
    
    
    TotalPredecessor CompanyBalance, December 31, 2002
    
    $
    
    
    
    $
    335,138
    
    
    $
    (646,309
    )
    
    $
    
    
    
    $
    
    
    
    $
    (311,171
    )Net income
    
    
    
    
    
    
    
    
    
    
    323,431
    
    
    
    
    
    
    
    
    
    
    
    323,431Fresh start adjustment
    
    
    
    
    
    
    (335,138
    )
    
    
    322,878
    
    
    
    
    
    
    
    
    
    
    
    (12,260
    )Balance, July 31, 2003
(prior to issuance of stock
at reorganization)
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Reorganized CompanyIssuance of stock upon
reorganization, July 31, 2003
(prior to restricted stock
award)
    
    $
    95
    
    
    $
    142,405
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    142,500Shares issued for restricted stock
award plan
    
    
    5
    
    
    
    7,495
    
    
    
    
    
    
    
    (7,500
    )
    
    
    
    
    
    
    Compensation expense recognized
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,042
    
    
    
    
    
    
    
    1,042Stock option grants
    
    
    
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Net loss
    
    
    
    
    
    
    
    
    
    
    (38,930
    )
    
    
    
    
    
    
    
    
    
    
    (38,930
    )Balance, December 31, 2003
    
    
    100
    
    
    
    149,901
    
    
    
    (38,930
    )
    
    
    (6,458
    )
    
    
    
    
    
    
    104,613Shares issued:Public stock offering
    
    
    37
    
    
    
    99,660
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    99,697Employee benefit plans
    
    
    7
    
    
    
    21,220
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    21,227Restricted stock forfeiture
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    60
    
    
    
    (60
    )
    
    
    Compensation expense recognized
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,471
    
    
    
    
    
    
    
    2,471Stock option grants
    
    
    
    
    
    
    3
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3Net income
    
    
    
    
    
    
    
    
    
    
    62,467
    
    
    
    
    
    
    
    
    
    
    
    62,467Balance, December 31, 2004
    
    $
    144
    
    
    $
    270,784
    
    
    $
    23,537
    
    
    $
    (3,927
    )
    
    $
    (60
    )
    
    $
    290,478
 Share Activity:
    
    Issued
    
    
    Treasury
    
    
    OutstandingBalance, December 31, 2002
    
    
    100
    
    
    
    
    
    
    
    100Fresh start adjustment
    
    
    (100
    )
    
    
    
    
    
    
    (100
    )Balance, July 31, 2003
    
    
    
    
    
    
    
    
    
    
    Stock issued
 Reorganization
    
    
    9,500,000
    
    
    
    
    
    
    
    9,500,000Stock issued
 Restricted stock
award plan
    
    
    500,000
    
    
    
    
    
    
    
    500,000Balance, December 31, 2003
    
    
    10,000,000
    
    
    
    
    
    
    
    10,000,000Stock issued
 Public offering
    
    
    3,719,898
    
    
    
    
    
    
    
    3,719,898Stock issued
 Employee benefit
plans
    
    
    717,325
    
    
    
    
    
    
    
    717,325Restricted stock forfeiture
    
    
    
    
    
    
    4,000
    
    
    
    (4,000
    )Balance, December 31, 2004
    
    
    14,437,223
    
    
    
    4,000
    
    
    
    14,433,223
 The accompanying notes are an integral part of the financial statements. 48




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Notes to Consolidated Financial Statements 1. Summary of Significant Accounting Policies Basis of Presentation The consolidated financial statements have been prepared in accordance with accounting
principles generally accepted in the United States of America which requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period. Actual results could
differ from those estimates. Wheeling-Pittsburgh Corporation (the Company) emerged from bankruptcy effective August 1, 2003
(see Note 2), and applied fresh start reporting as of July 31, 2003 (see note 3). As a result,
amounts reported in the financial statements for the seven months ended July 31, 2003 and for
the year ended December 31, 2002 relate to the Company prior to its reorganization and the
application of fresh start reporting. Amounts for these periods are referred to as being
applicable to the Predecessor Company. Amounts for periods subsequent to the reorganization
of the Company are referred to as being applicable to the Reorganized Company. Due to the
application of fresh start reporting as of July 31, 2003, amounts reported for the predecessor
company and the reorganized company are not comparable and have been separated by a black line
in the financial statements. Principles of Consolidation The consolidated financial statements include the accounts of the Company and all companies more
than 50% owned. All material inter-company accounts, balances and transactions have been
eliminated. The Company uses the equity method of accounting to account for investments in
unconsolidated companies more than 20% owned. Unrealized profits or losses on sales to equity
affiliates have been eliminated. Cash and Cash Equivalents Cash and cash equivalents include cash on hand and on deposit and highly liquid debt instruments
with maturities of three months or less. Cash that is restricted for use to fund capital
expenditures is reflected as a non-current asset. Accounts Receivable Accounts receivable are stated at net invoice amounts less an allowance for doubtful accounts.
The Company provides a specific allowance for doubtful accounts for certain amounts remaining
unpaid beyond normal customer payment periods and provides a general allowance for doubtful
accounts based on historical loss experience. All amounts deemed to be uncollectible are
charged against the allowance for doubtful accounts in the period in which the determination is
made. Inventory Inventories are stated at the lower of cost or market. Cost is determined using the last-in,
first-out (LIFO) method for substantially all inventories. At December 31, 2004 and 2003,
approximately 99% and 98%, respectively, of all inventories were valued using the LIFO method. Property, Plant and Equipment Property, plant and equipment acquired subsequent to July 31, 2003 has been recorded at cost.
With the adoption of fresh start reporting, property, plant and equipment acquired prior to
August 1, 2003, was restated at fair value as of August 1, 2003. Depreciation is computed using
the straight-line method based on estimated useful lives of 40 years for real property and
estimated useful lives ranging from 3 to 30 years for machinery and equipment. Betterments and
improvements are capitalized. Repairs and maintenance are expensed as incurred. Gains and
losses form the sale of property, plant and equipment is recorded as cost of goods sold.
Interest costs incurred to construct property, plant and equipment is capitalized. Prior to August 1, 2003, depreciation was computed using the straight-line or modified units of
production method. Under the modified units of production method, the straight-line method was
adjusted based on an
activity factor for operating assets. Adjusted annual depreciation was not less than 60% or
more than 110% of 49




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straight-line depreciation. Accumulated depreciation, after adjustment, was
not less than 75% or more than 110% of straight-line depreciation. The Company periodically evaluates property, plant and equipment for impairment whenever events
or changes in circumstances indicate that the carrying value of an asset may not be recoverable.
Considering the Companys integrated operations, asset impairment evaluations are generally
performed on a group basis, which represents the lowest level at which cash flows can be
separately identified. Software Costs Costs incurred for the development or purchase of internal-use software are capitalized and
amortized over the useful life of the software, which is generally five years or less. Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable
to differences between the financial statement carrying amount of existing assets and
liabilities and their respective tax bases. Deferred tax assets, including tax loss and tax
credit carryforwards, and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which temporary differences are expected to be recovered or
settled. The effect of a change in tax rates is recognized in the period in which enactment
occurs. Deferred income tax expense represents the change during the period in deferred tax
assets and deferred tax liabilities. The components of deferred tax assets and liabilities are
individually classified as current and non-current based on their characteristics. Deferred tax
assets are reduced by a valuation allowance when, in the opinion of management, it is more
likely than not that some portion or all of the deferred tax assets will not be realized Goodwill Goodwill was recorded as the result of the application of fresh-start reporting upon the
Companys emergence from bankruptcy. Under provisions of Statement of Position (SOP) 90-7,
Financial Reporting by Entities in Reorganization Under the Bankruptcy Code, either
pre-confirmation net operating loss carryforwards or any benefit resulting from the reversal of
a valuation allowance applicable to other deferred tax assets have been used first to reduce
recorded goodwill and then to reduce other intangible assets (see Note 11). Intangible Assets The carrying value of intangible assets with a finite useful life is reviewed for impairment
when events or changes in circumstances indicate that the carrying value of the intangible
assets may not be fully recoverable. Recoverability is determined based on an estimate of the
expected future undiscounted cash flows of the intangible assets. If the undiscounted cash
flows of the intangible assets exceed the carrying value of the intangible assets, an impairment
loss is recognized. The impairment loss is measured as the excess of the carrying value of the
intangible assets over the fair value of the intangible assets. Fair value is estimated using a
discounted cash flow model. The Company has no intangible assets with an indefinite useful
life. Deferred Financing Costs Costs incurred to obtain, extend or amend debt obligations are capitalized and amortized over
the term of the related obligation. Pension and Other Postretirement Benefits The Company maintains a defined benefit pension plan. The Company also maintains a defined
benefit retiree health care and life insurance plans that provide benefits for substantially all
of its active employees. The net pension and other postretirement benefits obligations recorded
and the related periodic benefit costs are based on, among other things, assumptions of discount
rates, estimated returns on plan assets, salary increases, mortality rates and future health
care medical trend rates. Actuarial techniques and assumptions are used to estimate these
obligations and the related periodic benefit costs. Asset Retirement Obligations An asset retirement obligation associated with the retirement of long-lived assets is recognized
when a liability is incurred and the fair value of the liability can be reasonably estimated.
If fair value cannot be determined in the period in which the liability is incurred, a liability
is recognized when a reasonable estimation of fair value 50




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can be made. Fair value is based on
quoted market prices or the best information available in the circumstances. The Company may
incur asset retirement obligations in the event of a permanent plant shutdown. However, as of
December 31, 2004 and 2003, the Companys plant assets have indeterminate lives and a reasonable
estimate of the fair value of associated asset retirement obligations cannot be made. Revenue Recognition Revenue from the sale of products is recognized when both risk of loss and title is transferred
to the customer, which coincides with the time such products are shipped. Shipping costs billed
to customers are recorded as revenues. Under the terms of a long-term scrap supply agreement executed in 2004, the Company sells all of
its internally generated scrap to a third party. Internally generated scrap sold to the third
party is processed by the third party and then repurchased by the Company at the original sales
price plus a processing fee. No revenue is recognized at the time of the initial sale. Environmental Expenditures Environmental expenditures relating to existing conditions caused by past operations that do not
contribute to future revenues are expensed. Environmental expenditures that extend the life of
related property, increase the value of related property or mitigate or prevent future
contamination are capitalized. Liabilities are recorded on an undiscounted basis when it is
probable that a liability has been incurred and the amount of the liability can be reasonably
estimated. Accruals for environmental obligations are not reduced by claims, if any, for
recoveries from insurance carriers or other third parties until it is probable that such
recoveries will be realized. Stock-based Compensation The Company accounts for stock-based compensation in accordance with the provisions of
Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to Employees and
related interpretations using the intrinsic method (see Note 8). Earnings (loss) per Share Basic earnings (loss) per share is computed by dividing net earnings (loss) applicable to common
shareholders by the weighted average number of shares of common stock outstanding during the
period. Diluted earnings (loss) per share is computed by dividing net earnings (loss)
attributable to common shareholders by the weighted average number of common shares outstanding,
adjusted for the dilutive effect of common stock equivalents. In periods where losses are
reported, the weighted average number of common shares outstanding excludes common stock
equivalents, as their inclusion would be anti-dilutive. Concentrations of Credit and Business Risk The Company is exposed to credit risk in the event of nonpayment by customers, principally steel
service centers, converters and processors and customers in the construction and container
industries. The Company mitigates its exposure to credit risk by performing on-going credit
evaluations and obtaining security as appropriate. During 2004, the five months ended December 31, 2003, the seven months ended July 31, 2003 and
the year ended December 31, 2002, the Company had sales to two customers, both affiliates,
comprising 26%, 26%, 29% and 26% of total sales, respectively. New Accounting Standards Under the provisions of SOP 90-7, the Company was required to adopt, as of July 31, 2003, all
accounting guidance that was going to be effective within a twelve-month period. The Financial Accounting Standards Board (FASB) issued FASB Interpretation (FIN) No. 46R,
Consolidation of Variable Interest Entities, in December 2003. Additionally, the FASB issued
several FASB Staff Positions during 2004, addressing, clarifying and amplifying FIN46. FIN 46R
is effective for all variable interest entities, other than special-purpose entities, for
periods ending after March 15, 2004. This interpretation and the related staff positions had no
effect on the financial statements of the Company. 51




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The Company adopted FASB No. 132-R (revised 2003), Employers Disclosures about Pensions and
Other Postretirement Benefits, an amendment of FASB Statements No. 87, 88, and 106 (FASB
132-R). FASB 132-R revises employers disclosures about pension plans and other postretirement
benefit plans. These disclosures are provided in Note 15. The FASB issued FASB Staff Position (FSP) No. 106-2, Accounting and Disclosure Requirements
Related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003, in May
2004. Based on a preliminary assessment of final guidance on determining actuarial equivalence,
the Company has assumed that its prescription drug benefits will not be actuarially equivalent
to the prescription drug benefits under Medicare Part D. The FASB issued FSP No. 109-1, Application of FASB Statement No. 109, Accounting for Income
Taxes, to the Tax Deduction on Qualified Production Activities Provided by the American Jobs
Creation Act of 2004 in December 2004. FSP No. 109-1 requires the tax deduction provided by
this tax act to be accounted for as a special deduction under FASB No. 109. The Company adopted
this staff position and incorporated the related effects in computing tax expense and related
tax assets and liabilities for 2004. The FASB
issued FASB No. 123(R), Share-Based Payment, in
December 2004. FASB No 123(R)
requires employers to value share-based payments using the fair value method, eliminating the
option to use the intrinsic method to value such payments. FASB No. 123(R) is effective for the
third quarter of 2005. Due to the immaterial number of share-based payments made by the
Company, the Company does not expect this statement to have a material impact on its financial
statements. The FASB issued FASB No. 151, Inventory Costs, an amendment of ARB No. 43, Chapter 4, in
December 2004. FASB No. 151 requires that abnormal amounts of idle facility expense, freight,
handling costs and wasted materials be recognized as current-period costs and not as
inventoriable costs. FASB No. 151 is effective for fiscal years beginning after June 15, 2005.
The Company does not expect this statement to have a material impact on its financial
statements. Reclassification Certain amounts in previously issued financial statements have been reclassified for comparative
purposes. 2. Bankruptcy and Reorganization On November 16, 2000, the Company and eight of its then-existing wholly-owned subsidiaries,
which represented substantially all of the Companys business, filed voluntary petitions for
relief under Chapter 11 of the United States Bankruptcy Code. The Company commenced Chapter 11
proceedings in order to restructure its outstanding debts and to improve its access to
additional funding needed to continue operations. Throughout the Chapter 11 proceedings, the
Company remained in possession of its properties and assets and continued to operate and manage
its businesses with the then-existing directors and officers as debtors-in-possession subject to
the supervision of the Bankruptcy Court. As part of the Chapter 11 proceedings, the Company filed its original Joint Plan of
Reorganization on
December 20, 2002, its First Amended Joint Plan of Reorganization on January 9, 2003, its Second
Amended Joint Plan of Reorganization on May 5, 2003 and its Third Amended Joint Plan of
Reorganization on May 19, 2003, reflecting the final negotiations with pre-petition note
holders, pre-petition trade creditors and unionized employees. The Companys plan of
reorganization was confirmed on June 18, 2003 and became effective on August 1, 2003. The
Company realized approximately $558 million in cancellation of debt income as a result of the
reorganization. The following is a summary of some of the significant transactions consummated on or about the
effective date of the plan of reorganization:  
    The Company amended and restated its by-laws and filed a second amended and restated
certificate of incorporation with the Delaware Secretary of State authorizing the issuance
of up to an aggregate of 80 52




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##### Table of Contents



million shares of common stock, par value $0.01 per share, and
20 million shares of undesignated preferred stock, par value $0.001 per share.  
    The Company exchanged, on a pro rata basis, $275 million in senior notes and $75 million
in term notes that existed prior to its bankruptcy filing for an aggregate of $20 million
in cash, $40 million in new Series A secured notes issued by Wheeling-Pittsburgh Steel
Corporation (WPSC), a wholly-owned subsidiary of the Company, collateralized by a second
lien on its tangible and intangible assets (other than our accounts receivable and
inventory) and its equity interests in its joint ventures and a third lien on its accounts
receivable and inventory, $20 million in new Series B secured notes issued by WPSC,
collateralized by a fifth lien on its tangible and intangible assets, its equity interests
in its joint ventures, and its accounts receivable and inventory, and 3,410,000 shares of
new common stock of the Company constituting 34.1% thereof.
    The Company cancelled its then-existing senior notes and related indenture and its
then-existing term notes and the related term loan agreement.
    The Company cancelled all shares of its common stock that existed prior to the
implementation of the plan of reorganization, at which point it ceased to be a subsidiary
of WHX Corporation.
    WPSC entered into a new $250 million senior secured term loan facility, which is
guaranteed in part by the Emergency Steel Loan Guarantee Board, the West Virginia Housing
Development Fund, WPC and WP Steel Venture Corporation, a wholly-owned subsidiary of the
Company, and is collateralized by a first lien on its tangible and intangible assets (other
than accounts receivable and inventory) and its equity interests in its joint ventures and
a second lien on its accounts receivable and inventory. WPSC also entered into a new $225
million senior secured revolving credit facility, which is guaranteed by the Company and WP
Steel Venture Corporation and is collateralized by a first lien on its accounts receivable
and inventory and a third lien on its other tangible and intangible assets and its equity
interests in its joint ventures and pledged stock of its subsidiaries.
    All of the obligations under the Companys $195 million debtor-in-possession credit
facility were satisfied in full and discharged.
    The Company and WPSC entered into an agreement with WHX Corporation providing for, among
other things, a $10 million capital contribution by WHX Corporation, the capitalization of
approximately $40 million in debt owed by the Company to WHX Corporation, a $10 million
unsecured loan from WHX Corporation and an agreement with WHX Corporation, the Pension
Benefit Guaranty Corporation (PBGC), and the United Steelworkers of America (USWA), with
respect to the Companys separation from WHX Corporations employee pension plan.
    WPC and WPSC entered into an agreement with its unionized employees represented by the
USWA which modified the existing labor agreement to provide for, among other things, future
pension arrangements with the USWA and reductions in the Companys employee-related costs.
    The Company issued 4,000,000 shares of new common stock constituting 40% thereof for the
benefit of USWA retirees in satisfaction of certain claims under its labor agreement and an
additional 1,000,000 shares of its new common stock constituting 10% thereof to or for the
benefit of the Companys salaried employees.
    The Company issued 1,590,000 shares of new common stock constituting 15.9% thereof to
certain of its creditors in satisfaction of various unsecured claims, including claims
relating to trade debt. There are still several matters pending in the Bankruptcy Court, including the resolution of
disputed unsecured and administrative claims and certain preference actions and other litigation
where we are seeking to recover monies. As of December 31, 2004 approximately 53,052 shares of
common stock issued pursuant to the plan of reorganization were reserved for distribution to
creditors pending resolution of certain disputed claims. If those 53




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##### Table of Contents



claims are ultimately allowed
in whole or in part by the Bankruptcy Court, the appropriate amount of stock will be distributed
to those claimants; if the claims are disallowed, the stock will be distributed to other
creditors of the same class, pro rata. To the extent that certain administrative and secured
claims are allowed by the Bankruptcy Court, those claims will be paid in cash, in an amount
which we expect will not exceed $100 thousand and for which there are sufficient reserves held
by the distribution agent. If and to the extent those claims are allowed as pre-petition
unsecured claims, then those creditors will receive stock, which has been reserved as described
above. In addition, the Company is the plaintiff in a number of preference actions, where it is
seeking to recover monies from creditors. The Company does not believe that any of these
remaining bankruptcy proceedings, individually or in the aggregate, will have a material adverse
effect on the Company. 3. Fresh Start Reporting In accordance with SOP 90-7, the Company adopted the provisions of fresh start reporting as of
July 31, 2003. In adopting the requirements of fresh start reporting, the Company made a
determination of the enterprise value of the entity based upon various valuation methods,
including discounted cash flow methodologies, analysis of comparable steel companies, and other
applicable ratios and economic industry information relevant to the operations of the Company.
The estimated total equity value of the reorganized company aggregating approximately $150
million was determined after taking into account the values of the obligations assumed in
connection with the Joint Plan of Reorganization. The following reconciliation of the Predecessor Companys consolidated balance sheet as of July
31, 2003 to that of the Reorganized Company as of July 31, 2003 was prepared with the
adjustments that give effect to the reorganization and fresh start reporting. The adjustments entitled Reorganization Adjustments reflect the consummation of the Joint Plan
of Reorganization, including the elimination of existing liabilities subject to compromise, and
consolidated shareholders deficit, and to reflect the aforementioned $150 million equity value. The adjustments entitled Fresh Start Adjustments reflect the adoption of fresh start
reporting, including the adjustments to record property and equipment at its fair value. Pre-Reorganization
    
    
    Reorganization
    
    
    
    
    Fresh Start
    
    
    
    
    Post-Reorganizationon 7/31/2003
    
    
    Adjustments
    
    
    
    
    Adjustments
    
    
    
    
    7/31/2003(Dollars in thousands)ASSETSCurrent Assets:Cash and cash equivalents
    
    $
    7,382
    
    
    $
    
    
    
    
    
    $
    
    
    
    
    
    $
    7,382Trade receivables, less allowance for
doubtful accounts of $1,916
    
    
    112,649
    
    
    
    (233
    )
    
    
    
    
    
    
    
    
    
    
    112,416Inventories
    
    
    164,322
    
    
    
    
    
    
    
    
    
    (9,658
    )
    [d]
    
    
    
    154,664Prepaid expenses and deferred charges
    
    
    6,559
    
    
    
    12
    
    
    
    
    
    
    
    
    
    
    
    6,571Total current assets
    
    
    290,912
    
    
    
    (221
    )
    
    
    
    
    (9,658
    )
    
    
    
    
    281,033Investment in affiliated companies
    
    
    59,982
    
    
    
    
    
    
    
    
    
    (19,505

    )
    [d]
    
    
    
    40,477Property, plant and equipment less
accumulated depreciation
    
    
    493,514
    
    
    
    
    
    
    
    
    
    (133,301
    )
    [d]
    
    
    
    360,213Deferred income tax benefits
    
    
    27,342
    
    
    
    (3,860
    )
    [b]
    
    
    
    
    
    
    
    
    
    23,482Restricted cash
    
    
    
    
    
    
    112,000
    
    [a]
    
    
    
    
    
    
    
    
    
    112,000Goodwill
    
    
    
    
    
    
    30,000
    
    [g]
    
    
    
    
    
    
    
    
    
    30,000Deferred charges and other assets
    
    
    8,964
    
    
    
    12,844
    
    [g]
    
    
    
    9,756
    
    [g]
    
    
    
    31,564Total assets
    
    $
    880,714
    
    
    $
    150,763
    
    
    
    
    $
    (152,708
    )
    
    
    
    $
    878,769
 54




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##### Table of Contents



Pre-
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Post-Reorganization
    
    
    Reorganization
    
    
    
    
    Fresh Start
    
    
    
    
    
    
    Reorganization7/31/2003
    
    
    Adjustments
    
    
    
    
    Adjustments
    
    
    
    
    
    
    7/31/2003(Dollars in thousands)LIABILITIES & STOCKHOLDERS EQUITY (DEFICIT)Current Liabilities:Trade payables
    
    $
    81,275
    
    
    $
    (1,334
    )
    
    [a]
    
    $
    
    
    
    
    
    
    
    $
    79,941Short-term debt
    
    
    137,214
    
    
    
    (100,299
    )
    
    [a]
    
    
    
    
    
    
    
    
    
    
    36,915Payroll and employee benefits payable
    
    
    35,118
    
    
    
    32,795
    
    
    [c]
    
    
    
    
    
    
    
    
    
    
    67,913Accrued federal, state and local taxes
    
    
    10,054
    
    
    
    1,200
    
    
    [a],[c]
    
    
    
    
    
    
    
    
    
    
    11,254Deferred income tax liabilities
    
    
    27,342
    
    
    
    (3,860
    )
    
    [a],[c]
    
    
    
    
    
    
    
    
    
    
    23,482Accrued interest and other liabilities
    
    
    8,026
    
    
    
    2,647
    
    
    [a],[c]
    
    
    
    
    
    
    
    
    
    
    10,673Long-term debt due in one year
    
    
    43,433
    
    
    
    (39,678
    )
    
    [a],[c],[f]
    
    
    
    
    
    
    
    
    
    
    3,755Total current liabilities
    
    
    342,462
    
    
    
    (108,529
    )
    
    
    
    
    
    
    
    
    
    
    
    
    233,933Long-term debt
    
    
    11,985
    
    
    
    327,863
    
    
    [a],[c]
    
    
    
    
    
    
    
    
    
    
    339,848Other employee benefit liabilities
    
    
    17,317
    
    
    
    124,981
    
    
    [c]
    
    
    
    
    
    
    
    
    
    
    142,298Other liabilities
    
    
    17,150
    
    
    
    3,040
    
    
    [a],[c]
    
    
    
    
    
    
    
    
    
    
    20,190Liabilities subject to compromise
    
    
    879,455
    
    
    
    (879,455
    )
    
    [c]
    
    
    
    
    
    
    
    
    
    
    Total liabilities
    
    
    1,268,369
    
    
    
    (532,100
    )
    
    
    
    
    
    
    
    
    
    
    
    
    736,269STOCKHOLDERS EQUITY (DEFICIT)Common Stock
 $.01 Par Value; 10 million
shares issued and outstanding
    
    
    
    
    
    
    100
    
    
    [c]
    
    
    
    
    
    
    
    
    
    
    100Additional paid-in capital
    
    
    335,138
    
    
    
    149,900
    
    
    [c],[g]
    
    
    (335,138
    )
    
    
    [d]
    
    
    
    149,900Deferred compensation
    
    
    
    
    
    
    (7,500
    )
    
    [e]
    
    
    
    
    
    
    
    
    
    
    (7,500
    )Accumulated earnings (deficit)
    
    
    (722,793
    )
    
    
    540,363
    
    
    [b],[c],[f]
    
    
    182,430
    
    
    
    [d]
    
    
    
    Total stockholders equity (deficit)
    
    
    (387,655
    )
    
    
    682,863
    
    
    
    
    
    (152,708
    )
    
    
    
    
    
    
    142,500Total liabilities and stockholders equity
    
    $
    880,714
    
    
    $
    150,763
    
    
    
    
    $
    (152,708
    )
    
    
    
    
    
    $
    878,769
  Footnotes:[a] Reflects the borrowing of the $250 million term loan proceeds and amounts under the
post-petition revolver and the payments necessary to effect the Plan of Reorganization, such as
the repayment of DIP facilities, cash distributions to creditors and the payment of fees and
expenses associated with the exit financing.[b] Reflects the impact on retained earnings of reorganization expenses net of tax benefit.[c] Reflects the settlement of liabilities subject to compromise, including the distribution of
cash, notes and equity to the pre-petition creditors, the assumption of OPEB and other
pre-petition liabilities (capital leases, employee benefits, taxes) and the cancellation of debt
income.[d] Reflects the adjustments to reflect Fresh Start reporting. These entries include the
write-down of inventories, property, plant and equipment and joint venture interests to their
appraised values, elimination of accumulated deficits and additional paid-in capital.[e] Reflects restricted stock awards for the distribution of employee equity into trust.[f] Reflects the cancellation of debt as a result of WHX Corporation forgiving its portion of
the DIP term loan.[g] Reflects the pre-funding of VEBA obligations with 4,000,000 shares of the Companys common
stock, an intangible asset related to joint venture supply agreements and goodwill. 4. Segments, Geographic Area and Major Customers The Company is engaged in one line of business and operates in one business segment, the making,
processing and fabricating of steel and steel products. The Company manufactures and sells hot
rolled and cold rolled sheet products, coated products, such as galvanized, pre-painted and tin
mill sheet products. The Company
also manufactures fabricated steel products, including roll-formed corrugating roofing, roof
deck, form deck, floor deck, bridgeform and other products used primarily in construction,
highway and agricultural markets. 55




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The Company has a diverse customer base, substantially all of which are located in the United
States. All of the Companys operating assets are located in the United States. During 2004,
the Company had sales to one customer, an affiliate, that approximated 17.5% of revenue. For
the five months ended December 31, 2003, the seven months ended July 31, 2003 and the year ended
December 31, 2002 the Company had sales to one customer, an affiliate, that approximated 15.5%,
16.8% and 15.6% of revenue, respectively, and had sales to another customer, an affiliate, that
approximated 10.1%, 12.0% and 10.8% of revenue, respectively 5. Transactions with Affiliates and Related Parties The Company owns 35.7% of the outstanding common stock of Wheeling-Nisshin, Inc.
(Wheeling-Nisshin), which is accounted for using the equity method of accounting. The Company
had sales to Wheeling-Nisshin of $246.7 million, $61.7 million, $96.0 million and $152.5 million
during 2004, the five months ended December 31, 2003, the seven months ended July 31, 2003 and
for the year ended December 31, 2002, respectively. Sales to Wheeling-Nisshin are made at
prevailing market prices. The Company received dividends from Wheeling-Nisshin of $2.5 million,
$2.5 million and $1.25 million during 2004, the seven months ended July 31, 2003 and the year
ended December 31, 2002, respectively. At December 31, 2004 and 2003, the Company had accounts
receivable due from Wheeling-Nisshin, Inc. of $1.6 million and $5.6 million, respectively, and
had accounts payable to Wheeling-Nisshin of $2.5 million and $1.8 million, respectively. The Company owns 50% of the outstanding common stock of Ohio Coatings Corporation (OCC), which
is accounted for using the equity method of accounting. The Company had sales to OCC of $121.1
million, $39.8 million, $68.2 million and $106.2 million during 2004, the five months ended
December 31, 2003, the seven months ended July 31, 2003 and the year ended December 31, 2002,
respectively. Sales to OCC are made at prevailing market prices. At December 31, 2004 and
2003, the Company had accounts receivable due from OCC of $9.7 million and $10.1 million,
respectively and had accounts payable to OCC of $.9 million and $4.3 million, respectively. At
December 31, 2004 and 2003, the Company has a loan receivable due from OCC of $9.7 million and
$11.5 million, respectively, which bears interest at approximately 5% per annum. The Company
recorded interest income on the loan receivable of $.5 million. $.3 million, $.4 million and $.7
million during 2004, the five months ended December 31, 2003, the seven months ended July 31,
2003 and the year ended December 31, 2002, respectively, and received payments on the loan of
$1.7 million. $.3 million and $.6 million during 2004, the five months ended December 31, 2003
and the seven months ended July 31, 2003, respectively. The Company sells steel products to Pittsburgh Canfield Corporation, a wholly-owned subsidiary

of WHX at prevailing market prices. The Company was a wholly-owned subsidiary of WHX through
July 31, 2003. During the seven months ended July 31, 2003 and during 2002, the Company had
sales of $8.9 million and $20.8 million, respectively, to PCC. 6. Interest Expense and Other Financing Costs Reorganized Company
    
    
    
    Predecessor Company(Dollars in thousands)Five Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    Ended
    
    
    Year EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002Interest incurred
    
    $
    18,933
    
    
    $
    8,744
    
    
    
    $
    7,660
    
    
    $
    13,075Less interest capitalized
    
    
    4,050
    
    
    
    243
    
    
    
    
    838
    
    
    
    1,774Net interest
    
    
    14,883
    
    
    
    8,501
    
    
    
    
    6,822
    
    
    
    11,301Amortization of deferred financing costs
    
    
    4,895
    
    
    
    1,714
    
    
    
    
    2,363
    
    
    
    4,686Interest expense and other financing costs
    
    $
    19,778
    
    
    $
    10,215
    
    
    
    $
    9,185
    
    
    $
    15,987
 56




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##### Table of Contents



7. Other Income Reorganized Company
    
    
    
    Predecessor Company(Dollars in thousands)Five Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    Ended
    
    
    Year EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002Equity income in affiliates
    
    $
    14,677
    
    
    $
    2,705
    
    
    
    $
    2,544
    
    
    $
    3,882Interest and investment income
    
    
    1,226
    
    
    
    638
    
    
    
    
    360
    
    
    
    764Other
    
    
    1,617
    
    
    
    1,007
    
    
    
    
    324
    
    
    
    (79
    )Total
    
    $
    17,520
    
    
    $
    4,350
    
    
    
    $
    3,228
    
    
    $
    4,567
 8. Stock-based Compensation In accordance with the Companys plan of reorganization, the Company established a restricted
stock plan pursuant to which it granted 500,000 shares of its common stock to selected key
employees as of the effective date of its plan of reorganization. All of the grants made under
the plan vest in increments of one-third of the total grant to each individual pro rata over
three years. During 2004, 165,333 shares of restricted common stock vested and 4,000 shares of
restricted stock were subject to forfeiture. Restricted stock expense related to the restricted
stock awards totaled $2.5 million for 2004. These amounts were reflected in shareholders
equity as a decrease of deferred compensation. During 2004 and 2003, the Company granted stock options for 19,215 and 17,793 shares of common
stock to certain directors of the Company at a weighted average price per share of $21.99 and
$6.95, respectively. The options vest upon receipt, are exercisable at the option of the holder
and lapse ten-years from the date of grant. The fair value of each option is estimated on the
grant date using the Black-Scholes pricing model. No stock options were exercised in 2004 or
2003. The Company recorded compensation expense relative to the stock options of $3 thousand
and $1 thousand in 2004 and for the five months ended December 31, 2003, respectively. The Company accounts for employee stock options using the intrinsic value method. The following
table illustrates the effect on net earnings per share if the Company had applied the fair value
recognition provisions of FASB 123, Accounting for Stock-based Compensation, to stock-based
employee compensation. Reorganized Company
    
    
    
    Predecessor Company(Dollars in thousands, except per share amountsFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    Ended
    
    
    Year EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002Net income (loss)
    
    $
    62,467
    
    
    $
    (38,930
    )
    
    
    $
    323,431
    
    
    $
    (57,567
    )Add: Stock based compensation
expense, net of tax
    
    
    1,609
    
    
    
    1,041
    
    
    
    
    
    
    
    
    Less: Total stock-based compensation
determined under fair value method
for all awards, net of tax
    
    
    (1,845
    )
    
    
    (1,148
    )
    
    
    
    
    
    
    
    Pro forma net income (loss)
    
    $
    62,231
    
    
    $
    (39,037
    )
    
    
    $
    323,431
    
    
    $
    (57,567
    )Earnings per share:Basic as reported
    
    $
    5.81
    
    
    $
    (4.10
    )
    
    
    
    *
    
    
    
    *Diluted as reported
    
    $
    5.68
    
    
    $
    (4.10
    )
    
    
    
    *
    
    
    
    *Basic pro forma
    
    $
    5.78
    
    
    $
    (4.11
    )
    
    
    
    *
    
    
    
    *Diluted pro forma
    
    $
    5.66
    
    
    $
    (4.11
    )
    
    
    
    *
    
    
    
    *
   *
    
    Prior to reorganization, the Company was a wholly-owned subsidiary of WHX Corporation (see Note 2). 57




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9. Inventories December 31,2004
    
    
    2003(Dollars in thousands)Raw materials
    
    $
    46,070
    
    
    $
    26,808In-process
    
    
    128,114
    
    
    
    90,170Finished products
    
    
    23,662
    
    
    
    31,227Other materials and supplies
    
    
    307
    
    
    
    378Total current cost
    
    
    198,153
    
    
    
    148,583Excess of current cost over carrying value
    
    
    (41,484
    )
    
    
    (1,688
    )Total carrying value
    
    $
    156,669
    
    
    $
    146,895
 During 2004, 2003 and 2002, certain inventory quantities were reduced, resulting in
liquidations of LIFO inventories carried at costs prevailing in prior periods. The effect was
to increase income by $2.1 and $2.4 million in 2004 and for the seven months ended July 31,
2003, respectively, and to decrease income by $.2 million for the five months ended December 31,
2003 and $0.8 million for the year ended December 31, 2002. 10. Property, Plant and Equipment December 31,2004
    
    
    2003(Dollars in thousands)Land and mineral properties
    
    $
    8,640
    
    
    $
    8,529Buildings
    
    
    21,627
    
    
    
    20,710Machinery and equipment
    
    
    438,201
    
    
    
    297,970Construction in progress
    
    
    61,376
    
    
    
    70,607Total
    
    
    529,844
    
    
    
    397,816Less accumulated depreciation and amortization
    
    
    (42,536
    )
    
    
    (10,051
    )Net
    
    $
    487,308
    
    
    $
    387,765
 Property, plant and equipment includes gross assets acquired under capital leases of $1.8
million at
December 31, 2004 and 2003. Related amortization included in accumulated
depreciation and amortization was $122 thousand and $51 thousand at December 31, 2004 and 2003,
respectively. Amortization of assets under capital leases is included in depreciation expense. 11. Goodwill and Intangible Assets The application of fresh start reporting resulted in an amount being allocated to reorganization
value in excess of amounts allocated to identifiable assets, which was reflected in the
financial statements as goodwill. Under the provisions of SOP 90-7 and FASB 109, either
pre-confirmation net operating loss carryforwards or benefits resulting from the reversal of a
valuation allowance applicable to other deferred tax assets are used first to reduce goodwill
and then to reduce other intangible assets, and finally as a credit to equity. During 2004,
goodwill was reduced by $30.0 million and other intangible assets were reduced by $3.0 million,
representing the tax benefit from the utilization of pre-confirmation net operating loss
carryforwards and deferred tax assets for which there had been a full valuation allowance. The Company recorded amortization expense of intangible assets of $.9 million and $.4 million in
2004 and for the five months ended December 31, 2003, respectively. Amortization expense of $.9
million will be recorded in each of the next five years unless the intangible asset is reduced
by the recognition of pre-confirmation tax benefits realized before that time. 58




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12. Short-Term Debt On August 1, 2003, WPSC entered into a three-year $225 million senior secured revolving credit
facility. The facility is collateralized by a first lien on accounts receivable and inventory
and a third lien on other tangible and intangible assets and investments in affiliates. Maximum
availability under the facility is currently limited to $150 million, including outstanding
letters of credit. Maximum availability under the facility amounted to $131.3 million as of
December 31, 2004. The facility matures on August 1, 2006. No amounts were outstanding under
the facility at December 31, 2004. At December 31, 2003, $79.3 million was outstanding under
the facility. Interest on borrowings under the facility is calculated based on LIBOR or the
agents prime rate using spreads based on borrowing availability, as defined by the facility.
The average rate of interest on the facility during 2004 and during the five months ended
December 31, 2003 approximated 4.9% and 5.0%, respectively. Effective March 31, 2005, the
facility is subject to various financial covenants, including fixed charge, leverage and
interest coverage ratios. The Company is restricted from paying any cash dividends under the
terms of the facility. Due to certain mandatory lock-box requirements and other provisions under the facility, the
revolving credit facility has been classified as a short-term obligation in accordance with the
provisions of EITF 95-22. 13. Long-Term Debt December 31,2004
    
    
    2003(Dollars in thousands)Senior secured term loan
    
    $
    237,500
    
    
    $
    250,000Series A secured notes
    
    
    41,681
    
    
    
    40,705Series B secured notes
    
    
    21,499
    
    
    
    20,397Unsecured 6% note
    
    
    10,530
    
    
    
    10,224West Virginia Department of Development
    
    
    6,539
    
    
    
    6,539Ohio Department of Development
    
    
    4,985
    
    
    
    4,985Industrial revenue bonds, including capital leases
    
    
    6,910
    
    
    
    8,095Other
    
    
    3,939
    
    
    
    2,449Total
    
    
    333,583
    
    
    
    343,394Less amount due in one year
    
    
    31,427
    
    
    
    2,698Long-term debt due after one year
    
    $
    302,156
    
    
    $
    340,696
 Assuming repayment of the senior secured term loan in 2008 and without consideration of
future prepayments that may be required based on excess cash flow calculations under certain
debt obligations, long-term debt matures as follows (dollars in thousands): 2005
    
    $
    31,4272006
    
    
    26,7332007
    
    
    26,3302008
    
    
    170,1272009
    
    
    1,195After 2009
    
    
    77,771Total
    
    $
    333,583
 $250 million term loan agreement On August 1, 2003, WPSC entered into a $250 million senior secured term loan agreement. The
term loan matures on August 1, 2014. However, if the administrative agent under the loan is
unable or unwilling to re-offer certain tranches of the term loan as of November 1, 2008, the
maturity date for each tranche of the term
loan will be November 1, 2008. The term loan is collateralized secured by a first lien on
tangible and intangible assets and investments in affiliates and a second lien on accounts
receivable and inventory. 59




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##### Table of Contents



The loan is payable in quarterly installments of $6.25 million, which began in the fourth
quarter of 2004. Additional prepayments are due under the loan on a quarterly basis equal to
50% of excess cash flow, as defined under the terms of the loan. Interest on borrowings under
the facility is calculated based on LIBOR or the agents prime rate using spreads defined by the
agreement. The average rate of interest on the facility during 2004 and during the five months
ended December 31, 2003 approximated 3.5% and 3.9%, respectively. Effective March 31, 2005, the
facility is subject to various financial covenants, including fixed charge, leverage and
interest coverage ratios. The Company is restricted from paying any cash dividends under the
agreement. $40 million Series A secured notes On August 1, 2003, the Company issued Series A secured notes in the aggregate amount of $40
million. The Series A secured notes mature on August 1, 2011. The Series A secured notes are
collateralized by a second lien on tangible and intangible assets and investments in affiliates
and a third lien on accounts receivable and inventory. The Series A secured notes have no fixed repayment schedule. Prepayments are required based on
excess cash flow, as defined under the terms of the notes. The Series A notes bear interest at
a rate of 5% per annum until July 1, 2008. Thereafter, such notes bear interest at a rate of 8%
per annum. In the event that distributions from Wheeling-Nisshin, Inc. and Ohio Coatings
Company (affiliates of the Company) are not adequate to pay interest under the Series A secured
notes when due, the Company is required to pay both cash interest and payment-in-kind interest
at rates set forth in the Series A secured notes. $20 million Series B secured notes On August 1, 2003, WPSC issued Series B secured notes in the aggregate amount of $20 million.
The Series B secured notes mature on August 1, 2010. The Series B secured notes are
collateralized by a fourth lien on tangible and intangible assets and investments in affiliates
and a fourth lien on accounts receivable and inventory. The Series B secured notes have no fixed repayment schedule. Prepayments are required based on
excess cash flow, as defined under the terms of the notes. The Series B secured notes bear
interest at a rate of 6% per annum. In the event that excess cash flow, as defined by the
secured notes, is insufficient to pay interest due under the secured notes, the Company is
required to pay both cash interest and payment-in-kind interest at rates set forth in the Series
B secured notes. $10 million unsecured note On August 1, 2003, the Company issued an unsecured note in the aggregate principal amount of $10
million to WHX Corporation. In July 2004, the note was sold by WHX Corporation to a third party.
The unsecured note matures in 2011. The unsecured note is subordinated in right of payment to
the revolving credit agreements, the term loan agreement and the Series A and B secured notes. The unsecured note has no fixed repayment schedule. The unsecured note bears interest at 6% per
annum. If cash interest is not paid, the Company is required to pay payment-in-kind interest. West Virginia and Ohio Departments of Development The Company has a five-year term loan agreement with the West Virginia Department of Development
that matures August 1, 2008. The term loan bears interest at a rate approximating 5.6%. The Company has a loan agreement with the Ohio Department of Development that matures August 1,
2005. The loan bears interest at a rate of 3%. Industrial revenue bonds Amounts due under industrial revenue bonds issued by the State of Virginia are payable in annual
installments ranging from $260 thousand in 2005 to $480 thousand in 2014, plus interest of 7%
through 2014. Amounts due under the obligations are collateralized by certain real property. 60




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##### Table of Contents



Amounts due under industrial revenue bonds issued by the State of Nevada are payable in annual
installments ranging from $375 thousand in 2005 to $380 thousand in 2014, plus interest at 8%
through 2014. Amounts due under the obligations are collateralized by certain real property. Other The Company has certain other obligations outstanding that are payable in various installments
ranging from $35 thousand per month, including interest at 9%, through 2007 to $300 thousand
semi-annually, plus interest at 7% through 2010. 14. Leases The Company leases certain equipment under operating lease agreements. Lease expense for 2004,
the five months ended December 31, 2003, the seven months ended July 31, 2003 and the year ended
December 31, 2002 amounted to $10.6 million, $3.9 million, $5.8 million and $9.9 million,
respectively. Under long-term operating leases, minimum lease payments are $3.9 million for
2005, $2.5 million for 2006, $2.5 million for 2007, $2.5 million for 2008, $2.4 million for 2009
and $8.5 million thereafter. 15. Pension and Other Postretirement and Postemployment Benefits All of the Companys defined benefit pension plans were merged into plans maintained by a
subsidiary of WHX Corporation in 1998. Pension costs were allocated from WHX Corporation to the
Company with respect to these plans. No costs were allocated to the Company by WHX Corporation
for the seven months ended July 31, 2003 and for the year ended December 31, 2002. As a result
of the Companys reorganization, effective August 1, 2003, all of these defined benefit
pension plans were frozen. The Company has no remaining obligation under any of these plans. Effective August 1, 2003, the Companys USWA-represented employees became participants in the
Steelworker Pension Trust (SPT), a multi-employer pension plan. The Company is obligated to
make monthly contributions to the SPT based on hours worked by USWA-represented employees.
During 2004 and for the five months ended December 31, 2003, the Company accrued $3.9 million
and $2.3 million, respectively, under the plan. During 2004, the Company contributed $14.0
million to the SPT, with $8.4 million of this amount extinguishing an obligation to the SPT
recognized as of July 31, 2003 in connection with the application of fresh start reporting. Effective August 1, 2003, the Company adopted a supplemental defined benefit pension plan for
all salaried employees employed as of January 31, 1998, which provides a guaranteed minimum
benefit based on years of service and compensation. The total benefit payable under this plan
is offset by the employees account balance in a salaried defined contribution pension plan, the
employees accrued benefit payable by the Pension Benefit Guaranty Corporation related to a
defined pension benefit plan terminated in 1985 and the employees accrued benefit payable as of
July 31, 2003 under a plan sponsored by WHX Corporation. The Company maintains health care and life insurance benefit plans for retired salaried
employees and for hourly employees retiring after October 1, 2003. Hourly employees who retired
prior to October 1, 2003 are provided similar benefits under a Voluntary Employee Benefits
Association (VEBA) trust (See Note 16). In general, these plans pay a percentage of medical
costs, reduced by deductibles and other coverages. The Company has an agreement with the USWA
to limit or cap the per capita cost of benefits to be paid for periods subsequent to February 1,
2009 at the per capita cost incurred during the preceding twelve-month period ending January 1,
2009. Based on a preliminary assessment of final guidance on determining actuarial equivalence,
the Company has assumed that its prescription drug benefit plan will not be actuarially
equivalent to the prescription drug benefits under Medicare Part D. The Company uses a December 31 measurement date for all benefit plans. 61




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##### Table of Contents



The benefit obligation, change in plan assets, funded status and the amounts recognized in the
consolidated balance sheet with respect to the plans were as follows: Pension Benefits
    
    
    
    Postretirement BenefitsDecember 31,
    
    
    
    December 31,2004
    
    
    2003
    
    
    
    2004
    
    
    2003(Dollars in thousands)
    
    
    
    (Dollars in thousands)Change in benefit obligation:Benefit obligation, beginning of year
    
    $
    1,854
    
    
    $
    
    
    
    
    $
    125,205
    
    
    $
    314,053Service cost
    
    
    78
    
    
    
    29
    
    
    
    
    2,232
    
    
    
    2,743Interest cost
    
    
    116
    
    
    
    48
    
    
    
    
    6,642
    
    
    
    14,551Plan amendments
    
    
    930
    
    
    
    1,624
    
    
    
    
    (34,309
    )
    
    
    Actuarial (gain) loss
    
    
    1,308
    
    
    
    153
    
    
    
    
    (2,495
    )
    
    
    25,786Benefits paid
    
    
    (99
    )
    
    
    
    
    
    
    
    (5,707
    )
    
    
    (16,007
    )Decrease due to collective
bargaining agreement
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (215,921
    )Benefit obligation, end of year
    
    $
    4,187
    
    
    $
    1,854
    
    
    
    $
    91,568
    
    
    $
    125,205
 Pension Benefits
    
    
    
    Postretirement BenefitsDecember 31,
    
    
    
    December 31,2004
    
    
    2003
    
    
    
    2004
    
    
    2003(Dollars in thousands)
    
    
    
    (Dollars in thousands)Change in plan assets:Fair value of plan assets beginning of year
    
    $
    
    
    
    $
    
    
    
    
    $
    
    
    
    $
    Company contributions
    
    
    99
    
    
    
    
    
    
    
    
    5,706
    
    
    
    16,007Benefits paid
    
    
    (99
    )
    
    
    
    
    
    
    
    (5,706
    )
    
    
    (16,007
    )Fair value of plan assets end of year
    
    $
    
    
    
    $
    
    
    
    
    $
    
    
    
    $
    Funded status of plans:Fair value of plan assets, beginning of year
    
    $
    (4,187
    )
    
    $
    (1,854
    )
    
    
    $
    (91,568
    )
    
    $
    (125,205
    )Unrecognized actuarial loss
    
    
    1,462
    
    
    
    153
    
    
    
    
    21,974
    
    
    
    24,877Unrecognized prior service cost (benefit)
    
    
    2,371
    
    
    
    1,571
    
    
    
    
    (33,901
    )
    
    
    Net amount recognized
    
    $
    (354
    )
    
    $
    (130
    )
    
    
    $
    (103,495
    )
    
    $
    (100,328
    )Amount recognized in consolidated
balance sheet:Intangible pension asset, included in
deferred charges and other assets
    
    $
    1,001
    
    
    $
    
    
    
    
    $
    
    
    
    $
    Payroll and employee benefits payable
    
    
    
    
    
    
    
    
    
    
    
    (6,000
    )
    
    
    Other employee benefits liabilities
    
    
    (1,355
    )
    
    
    (130
    )
    
    
    
    (97,495
    )
    
    
    (100,328
    )Net amount recognized
    
    $
    (354
    )
    
    $
    (130
    )
    
    
    $
    (103,495
    )
    
    $
    (100,328
    )
 The accumulated benefit obligation for the defined benefit pension plan was $1,354 and $180
at December 31, 2004 and 2003, respectively. 62




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##### Table of Contents



Components of net periodic benefit costs were as follows: Reorganized Company
    
    
    
    Predecessor CompanyFive Months
    
    
    
    Seven MonthsEnded
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002(Dollars in thousands)
    
    
    
    (Dollars in thousands)Pension benefitsNet periodic benefit cost:Service cost
    
    $
    78
    
    
    $
    29
    
    
    
    $
    
    
    
    $
    Interest cost
    
    
    116
    
    
    
    48
    
    
    
    
    
    
    
    
    Amoritization of prior service cost
    
    
    129
    
    
    
    53
    
    
    
    
    
    
    
    
    Net periodic benefit cost
    
    $
    323
    
    
    $
    130
    
    
    
    $
    
    
    
    $
    
 Reorganized Company
    
    
    
    Predecessor CompanyFive Months
    
    
    
    Seven MonthsEnded
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002(Dollars in thousands)
    
    
    
    (Dollars in thousands)Postretirement benefitsNet periodic benefit cost:Service cost
    
    $
    2,232
    
    
    $
    1,042
    
    
    
    $
    1,701
    
    
    $
    2,431Interest cost
    
    
    6,642
    
    
    
    2,965
    
    
    
    
    11,586
    
    
    
    19,080Amoritization of prior service cost
    
    
    (408
    )
    
    
    
    
    
    
    
    (1,582
    )
    
    
    (2,712
    )Recognized actuarial (gain) loss
    
    
    408
    
    
    
    
    
    
    
    
    (1,770
    )
    
    
    (5,767
    )Net periodic benefit cost
    
    $
    8,874
    
    
    $
    4,007
    
    
    
    $
    9,935
    
    
    $
    13,032
 Assumptions used to determine benefit obligations and net periodic benefit costs were as
follows: At December 31,2004
    
    2003Discount rate
    
    5.75%
    
    6.00%Rate of compensation increase
    
    4.00%
    
    0.00%
 Years EndedDecember 31,
    
    December 31,
    
    December 31,2004
    
    2003
    
    2002Discount rate
    
    6.00%
    
    6.50%
    
    7.25%Rate of compensation increase
    
    0.00%
    
    
    
    
 Assumed health care cost trend rates were as follows: At December 31,2004
    
    2003Health care cost trend rate assumed for next year
    
    11.00%
    
    8.25%Rate to which the cost trend rate gradually declines
    
    5.00%
    
    4.75%Year that the rate reaches the rate at which it is assumed to remain
    
    2011
    
    2008
 63




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##### Table of Contents



Assumed health care cost trend rates have a significant effect on the amounts reported for the
health care plan. A one-percentage point change in these assumed rates would have the following
effects: 1%
    
    
    1%Increase
    
    
    DecreaseEffect on service and interest costs
    
    $
    372
    
    
    $
    (183
    )Effect on accumulated benefit obligation
    

    $
    4,376
    
    
    $
    (2,063
    )
 The Company expects to make the following contributions and make the following benefit
payments with respect to its benefit plans: Pension
    
    
    PostretirementBenefits
    
    
    BenefitsEmployer contributions - 2005
    
    $
    295Expected benefit payments:2005
    
    
    295
    
    
    $
    3,6712006
    
    
    293
    
    
    
    4,0992007
    
    
    248
    
    
    
    4,4572008
    
    
    254
    
    
    
    4,9912009
    
    
    462
    
    
    
    5,5392010 - 2014
    
    
    3,590
    
    
    
    34,886
 The Company maintains defined contribution pension plans for both salaried and hourly
employees. In general, contributions are made to hourly defined contribution plans based on age
and hours worked. In general, contributions are made to salaried defined contribution plans based
on age and compensation levels. Contributions to these plans for 2004, the five months ended
December 31, 2003, the seven months ended July 31, 2003 and the year ended December 31, 2002
amounted to $2.6 million, $1.1 million, $1.6 million and $3.0 million, respectively. The Company
maintains savings plans (401k plans) for both salaried and hourly employees. Employees may
contribute up to 50% of their annual compensation to these plans, subject to statutory limitations.
The Company did not make any matching contributions to these savings plans during any of the
periods presented. The Coal Industry Retiree Health Benefit Act of 1992 (the Act) created a new
United Mine Workers of America postretirement medical and death benefit plan to replace two
existing plans that had developed significant deficits. The Act assigns companies the remaining
benefit obligations for former employees and beneficiaries, and a pro rata allocation of benefits
related to unassigned beneficiaries (orphans). The Companys obligation under the Act relates to
its previous ownership of coal mining operations. Amounts accrued for these obligations at
December 31, 2004 and 2003 were $2.6 million and $2.9 million, respectively. In 2003 the courts
determined that certain retirees and dependents were not the responsibility of the Company. In the
fourth quarter of 2003, the Company received net cash proceeds of $7.2 million for premiums
previously paid which was recorded as income upon receipt. The Company provides benefits to former
or inactive employees after employment but before retirement. Those benefits include, among others,
disability, severance and workers compensation. Amounts accrued for these obligations at December
31, 2004 and 2003 were $30.6 million and $29.2 million, respectively. These amounts were
determined using a discount rate of 5.75% and 6.00% at December 31, 2004 and 2003, respectively,
and are included in other employee benefit liabilities. 16. VEBA and Profit Sharing Plans Hourly
employees who retired prior to October 1, 2003, are provided medical and life insurance benefits
through a VEBA trust. The VEBA trust was established on October 1, 2003 and was pre-funded with 4
million shares of common stock of the Company. The Company is required to make quarterly
contributions to the VEBA trust based on varying levels of operating cash flow, as defined by the
plan, ranging from 12% to 40%, 64




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##### Table of Contents



in addition to 15% of operating cash flow up to $30 per ton.
Quarterly contributions are payable in cash and, at the discretion of the Company, in common stock
of the Company. During 2004, the Company incurred an obligation under the plan of $22.9 million.
Of this amount, $11.2 million was satisfied with pre-funded amounts, resulting in net VEBA expense
of $11.7 million for the year. The Company satisfied $4.9 million of this obligation by issuing
169,622 shares of common stock to the plan during the year and, at the discretion of the Company,
expects to satisfy $1.7 million of this amount by issuing common stock during the first quarter of
2005. The remaining portion of this amount was settled in cash. At December 31, 2004, the VEBA
trust held 3,769,622 shares of common stock of the Company in trust. Effective October 1, 2003,
the Company established a profit sharing plan for hourly and salaried employees. The Company is
required to make quarterly contributions to the plan ranging from 4% to 15% of operating cash flow,
as defined by the plan, in excess of $30 per ton. Quarterly contributions are payable in cash or,
at the discretion of the Company, in common stock of the Company. During 2004, the Company
incurred profit sharing expense of $16.4 million. The Company satisfied this obligation by issuing
547,703 shares of common stock to the plan during the year. 17. Income Taxes The provision for income taxes consisted of the following: Reorganized Company
    
    
    
    Predecessor CompanyFive Months
    
    
    
    Seven MonthsEnded
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002(Dollars in thousands)
    
    
    
    (Dollars in thousands)CurrentFederal tax provision (benefit)
    
    $
    841
    
    
    $
    9
    
    
    
    $
    (659
    )
    
    $
    State tax provision
    
    
    133
    
    
    
    6
    
    
    
    
    18
    
    
    
    11Total
    
    
    974
    
    
    
    15
    
    
    
    
    (641
    )
    
    
    11DeferredFederal tax provision
    
    
    28,842
    
    
    
    
    
    
    
    
    
    
    
    
    State tax
provision
    
    
    3,790
    
    
    
    
    
    
    
    
    
    
    
    
    Total
    
    
    32,632
    
    
    
    
    
    
    
    
    
    
    
    
    Income tax provision (benefit)
    
    $
    33,606
    
    
    $
    15
    
    
    
    $
    (641
    )
    
    $
    11
 The provisions of the American Jobs Creation Act of 2004 had no effect on the determination of
current tax expense for 2004. 65




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##### Table of Contents



The provision for income taxes differs from the amount of income tax determined by applying the
applicable U.S. statutory federal income tax rate to pretax income as follows: Reorganized Company
    
    
    
    Predecessor CompanyFive Months
    
    
    
    Seven MonthsEnded
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002(Dollars in thousands)
    
    
    
    (Dollars in thousands)Income (loss)
before taxes
    
    $
    96,073
    
    
    $
    (38,915
    )
    
    
    $
    322,790
    
    
    $
    (57,556
    )Tax provision
(benefit at
statutory rate
    
    
    33,626
    
    
    
    (13,621
    )
    
    
    
    112,977
    
    
    
    (20,145
    )Increase (decrease)
in tax due to:Equity income in
affiliates
    
    
    (4,110
    )
    
    
    (757
    )
    
    
    
    (712
    )
    
    
    (1,086
    )State income tax,
net
    
    
    3,836
    
    
    
    4
    
    
    
    
    12
    
    
    
    7Change in valuation
allowance
    
    
    279
    
    
    
    14,364
    
    
    
    
    27,941
    
    
    
    21,158Fresh start
adjustments
    
    
    
    
    
    
    
    
    
    
    
    (140,205
    )
    
    
    Other
    
    
    (25
    )
    
    
    25
    
    
    
    
    (654
    )
    
    
    77Income tax
provision (benefit)
    
    $
    33,606
    
    
    $
    15
    
    
    
    $
    (641
    )
    
    $
    11
 The components of deferred tax assets and liabilities was as follows: December 31,2004
    
    
    2003(Dollars in thousands)Assets:Postretirement and postemployment benefits
    
    $
    36,362
    
    
    $
    35,396Operating loss carryforwards (expiring 2011 - 2023)
    
    
    83,311
    
    
    
    116,708Mininum tax credit carryforwards
    
    
    845
    
    
    
    Pension and other employee benefits
    
    
    17,091
    
    
    
    23,393Provision for expenses and losses
    
    
    20,889
    
    
    
    20,604Leases
    
    
    5,389
    
    
    
    8,836State income taxes, net
    
    
    11,489
    
    
    
    11,643Other
    
    
    9,788
    
    
    
    10,509185,164
    
    
    
    227,089Liabilities:Property, plant and equipment
    
    
    (58,178
    )
    
    
    (54,188
    )Inventory
    
    
    (25,900
    )
    
    
    (31,225
    )State income taxes, net
    
    
    (11,489
    )
    
    
    (11,692
    )Other
    
    
    (445
    )
    
    
    (601
    )(96,012
    )
    
    
    (97,706
    )Net
    
    
    89,152
    
    
    
    129,383Valuation allowance
    
    
    (89,152
    )
    
    
    (129,730
    )Net deferred tax asset (liability)
    
    $
    
    
    
    $
    (347
    )
 In connection with the Companys reorganization and emergence from bankruptcy in 2003,
various differences giving rise to deferred tax assets and liabilities were revalued.
Additionally, certain tax attributes, including net operating losses and tax credits were reduced
or eliminated in exchange for tax-free treatment of cancellation of 66




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##### Table of Contents



indebtedness income. The net
deferred tax asset was revalued to $192.0 million, against which a valuation allowance was provided
in full. Subject to certain rules relating to the use of tax attributes upon emergence from
bankruptcy, the Company has the ability to use such attributes, principally net operating losses,
without restriction. However, due to uncertainties surrounding future realization of these
benefits, a full valuation allowance has been maintained by the Company against the net deferred
tax asset. To the extent that tax benefits are realized from the release of this valuation
allowance, the recognition of the tax benefit is first used to reduce goodwill, then other
intangible assets and finally as an addition to paid in capital. During 2004, tax benefits were
recognized to the extent of $33.0 million. The statute of limitations has expired for years
through 2000. Federal income tax returns have been examined through 1997. Additionally, while the
Company is no longer affiliated with WHX, the Companys former parent, the Companys tax attributes
could be impacted by an audit of WHX for those years in which the Company was a subsidiary of WHX.
Management believes it has adequately provided for all taxes on income. 18. Supplemental Cash Flow Information Cash payments for interest and taxes were as follows: Reorganized Company
    
    
    
    Predecessor CompanyFive Months
    
    
    
    Seven MonthsEnded
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002(Dollars in thousands)
    
    
    
    (Dollars in thousands)Interest, net of capitalized amounts
    
    $
    12,509
    
    
    $
    6,267
    
    
    
    $
    7,827
    
    
    $
    10,885Income taxes (refund)
    
    
    1,600
    
    
    
    
    
    
    
    
    (600
    )
    
    
    
 19. Financial Instruments The carrying value and the estimated fair value of the
Companys financial instruments were as follows: December 31, 2004
    
    
    December 31, 2003Fair Value
    
    
    Carrying Value
    
    
    Fair Value
    
    
    Carrying Value(Dollars in thousands)
    
    
    (Dollars in thousands)Cash and cash equivalents
    
    $
    31,198
    
    
    $
    31,198
    
    
    
    4,767
    
    
    $
    4,767Short-term debt
    
    
    
    
    
    
    
    
    
    
    79,251
    
    
    
    79,251Long-term debt:Senior
secured term loan - $250 million
    
    
    237,500
    
    
    
    237,500
    
    
    
    250,000
    
    
    
    250,000Other (see discussion below)
    
    
    96,083
    
    
    
    96,083
    
    
    
    93,394
    
    
    
    93,394
 Cash and cash equivalents and short-term debt:
The carrying amount of cash and cash
equivalents and short-term debt approximates fair value due to the short maturity of the
instruments. Senior secured term loan:
The senior secured term loan is guaranteed and, as
such, carries a fair value rate of interest. The fair value of this instrument is estimated to
reasonably approximate its carrying value. Other long-term debt:
Other long-term debt is not
publicly traded and carries rates of interest that may or may not reflect a fair value rate of
interest. The fair value of these instruments cannot be determined with reasonable accuracy and
may or may not approximate carrying value. For this reason, fair value has been presented as being
equal to carrying value in the table above. Management understands that certain of these
obligations have traded at an amount below carrying value. 67




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20. Commitments and Contingencies Environmental Matters
Prior to confirmation of the Companys plan of reorganization effective
August 1, 2003, the Company settled all pre-petition environmental claims made by state (Ohio,
West Virginia, Pennsylvania) and Federal (USEPA) environmental regulatory agencies . Consequently,
the Company believes that it has settled and/or discharged environmental liability for any known
Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA or Superfund) sites,
pre-petition stipulated penalties related to active consent decrees, or other pre-petition
regulatory enforcement actions. The Company estimates that demands for stipulated penalties and
fines for post-petition events and activities through December 31, 2004 could total approximately
$2.4 million, which has been fully reserved by the Company. These claims arise from instances in
which the Company exceeded post-petition consent decree terms, including: (a) $1.9 million related
to a January 30, 1996 USEPA consent decree for the Companys coke oven gas desulfurization
facility; (b) $0.3 million related to a July 1991 USEPA consent decree for water discharges to the
Ohio River; and (c) $0.2 million related to a September 20, 1999 Ohio EPA consent decree for the
Companys coke oven gas desulfurization facility. In September 2000, the Company entered into a
consent order with the West Virginia Department of Environmental Protection wherein the Company
agreed to remove contaminated sediments from the bed of the Ohio River. Approximately $1.4 million
was spent on these activities in 2002, $0.6 million in 2003 and $4.6 million in 2004. During
removal activities in 2003, the Company discovered a broader area of contaminated sediments. The
Company estimates the cost of removal of the remaining contaminated sediments at $3.4 million,
which has been fully reserved by the Company. The Company currently expects this work to be substantially complete by the end of 2006. The
Company is under a final administrative order issued by the USEPA in June 1998 to conduct a
Resource Conservation and Recovery Act Facility Investigation to determine the nature and extent of
soil and groundwater contamination at its coke plant in Follansbee, West Virginia. USEPA approved
the Companys investigation work plan, and field activities were completed in 2004. The Company
will submit the results of this investigation to the USEPA in 2005. It is expected that some
remediation measures will be necessary and could commence within the next three to five years.
Based on a preliminary estimate of the range of the possible cost to remediate, the Company has
reserved approximately $5.2 million for such remediation measures. The USEPA conducted a
multimedia inspection of our Steubenville, Mingo Junction, Yorkville and Martins Ferry, Ohio and
Follansbee, West Virginia facilities in March and June 1999. The inspection covered environmental
regulations applicable to these plants. Many of the issues were resolved and settled prior to
emergence from Chapter 11 bankruptcy. Based on current estimates, the Company has reserved $1.4
million for resolution of outstanding issues. Capital expenditures for environmental projects
totaled $5.5 million for the year ended December 31, 2004. The Company estimates capital
expenditures for environmental projects to be $12.0 million for 2005, $14.2 million for 2006 and
$4.1 million for 2007. However, due to the possibility of unanticipated factual or regulatory
developments, the amount and timing of future capital expenditures may vary substantially from such
estimates. Accrued environmental liabilities totaled $13.4 million at December 31, 2004 and $14.7
million at December 31, 2003. These accruals were based on all information available to the
Company. As new information becomes available, whether from third parties or otherwise, and as
environmental regulations change, the liabilities are reviewed on a quarterly basis and the
accruals are adjusted accordingly. Unless stated above, the time frame over which these
liabilities will be paid is presently unknown. Further, the Company considers it reasonably
possible that it could ultimately incur additional liabilities relative to the above exposures of
up to $5.0 million. 68




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Commitments
The Company entered into a 15-year take-or-pay contract in 1999 that was amended in
2003 that requires the Company to purchase oxygen, nitrogen and argon each month with a minimum
monthly charge of approximately $0.6 million, subject to escalation clauses. Payments for
deliveries of oxygen totaled $14.2 million in 2004, $9.3 million in 2003 and $7.0 million in 2002. The Company entered into a 20-year contract in 1999, which was amended in 2003 that requires the
Company to purchase steam and electricity each month or pay a minimum monthly charge of
approximately $0.4 million. Additionally, the contract requires a variable portion calculated as
$3.75 times the number of tons of iron produced each month with an agreed to minimum of 3,000 tons
per day. Payments for deliveries of steam and electricity totaled $9.2 million in 2004, $8.8
million in 2003 and $13.8 million in 2002. At December 31, 2004, a maximum termination payment of
$33.4 million would have been required to terminate the contract. In 2004, the Company entered
into a take-or-pay contract to purchase coal each month with a minimum monthly charge of
approximately $0.6 million. The term of the contract expires on December 31, 2007, while the
Company has the sole option to terminate the contract on or after January 1, 2006. After such date,
the pricing will be subject to market conditions with a cap collar. Payments for deliveries of coal
totaled $9.5 million in 2004, $11.8 million in 2003 and $16.4 million in 2002. At December 31,
2004, a maximum termination payment of $7.6 million would have been required to terminate the
contract. Other
The Company is the subject of, or party to, a number of other pending or
threatened legal actions involving a variety of matters. However, based on information currently
available, management believes that the disposition of these matters will not have a material
adverse effect on the business, results of operations or the financial position of the Company. 21. Summarized Financial
Information of Affiliates - Unaudited The Company owns 35.7% of the
outstanding common stock of Wheeling-Nisshin, Inc. and 50% of the outstanding common stock of Ohio
Coatings Company, both of which are accounted for using the equity method of accounting.
Summarized financial information for these affiliates is as follows: December 31,2004
    
    
    2003(Dollars in thousands)Current assets
    
    $
    148,730
    
    
    $
    116,789Noncurrent assets
    
    
    103,139
    
    
    
    114,116Total assets
    
    $
    251,869
    
    
    $
    230,905Current liabilities
    
    $
    45,165
    
    
    
    44,350Noncurrent liabilities
    
    
    39,746
    
    
    
    44,288Total liabilities
    
    
    84,911
    
    
    
    88,638Total equity
    
    
    166,958
    
    
    
    142,267Total liabilities and equity
    
    $
    251,869
    
    
    $
    230,905
 69




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Predecessor Company
    
    
    
    Predecessor CompanyFive Months
    
    
    
    Seven MonthsEnded
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002(Dollars in thousands)
    
    
    
    (Dollars in thousands)Net sales
    
    $
    692,897
    
    
    $
    215,031
    
    
    
    $
    302,293
    
    
    $
    491,827Cost of goods sold
    
    
    607,148
    
    
    
    199,429
    
    
    
    
    276,641
    
    
    
    450,855Other operating costs
    
    
    35,242
    
    
    
    7,942
    
    
    
    
    17,336
    
    
    
    27,412Operating income
    
    
    50,507
    
    
    
    7,660
    
    
    
    
    8,316
    
    
    
    13,560Non-operating income (loss)
    
    
    (1,374
    )
    
    
    (971
    )
    
    
    
    (1,502
    )
    
    
    1,564Provision for income taxes
    
    
    (16,721
    )
    
    
    (1,452
    )
    
    
    
    (1,302
    )
    
    
    (6,419
    )Net income
    
    $
    32,412
    
    
    $
    5,237
    
    
    
    $
    5,512
    
    
    $
    8,705
 22. Summarized Combined Financial Information WPSC, a wholly-owned subsidiary of the
Company (WPC), is the issuer of the outstanding $40 million Series A notes and $20 million Series B
notes. The Series A and Series B notes were not registered under the Securities Act of 1933 or the
Securities Act of 1934. The Series A notes and Series B notes are each fully and unconditionally
guaranteed, jointly and severally, by WPC and its present and future subsidiaries. WPSC and each
subsidiary guarantor of the Series A and Series B notes are 100%-owned by the parent guarantor,
WPC. Because the subsidiary guarantors are minor, individually and in the aggregate, the combined
consolidating financial information for WPC and the subsidiary guarantors has been combined below
in the column entitled WPC and Subsidiary Guarantors. Prior to the Companys reorganization in
bankruptcy, WPC,
then a wholly-owned subsidiary of WHX Corporation, a public company, had issued $275 million
principal amount 9 1/4% senior notes in a registered exchange offer under the Securities Act of
1933. These notes were fully and unconditionally guaranteed, jointly and severally, by WPCs
then-existing and future operating subsidiaries. As discussed more fully in Note 2 above, the WPC
9 1/4% senior notes were extinguished pursuant to the Companys plan of reorganization on or about
August 1, 2003. 70




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CONDENSED CONSOLIDATING BALANCE SHEETReorganized Company December 31, 2004(Dollars in Thousands)ConsolidatingWPC and
    
    
    
    
    
    
    andSubsidiary
    
    
    
    
    
    
    Eliminating
    
    
    WPCGuarantors
    
    
    WPSC
    
    
    Entries
    
    
    ConsolidatedAssetsCash and cash equivalents
    
    $
    
    
    
    $
    31,198
    
    
    $
    
    
    
    $
    31,198Trade accounts receivables
    
    
    
    
    
    
    144,509
    
    
    
    
    
    
    
    144,509Inventories
    
    
    
    
    
    
    156,669
    
    
    
    
    
    
    
    156,669Other current assets
    
    
    16
    
    
    
    29,937
    
    
    
    
    
    
    
    29,953Total current assets
    
    
    16
    
    
    
    362,313
    
    
    
    
    
    
    
    362,329Intercompany receivables
    
    
    
    
    
    
    4,075
    
    
    
    (4,075
    )
    
    
    Investments and advances in affiliates
    
    
    291,625
    
    
    
    53,016
    
    
    
    (291,625
    )
    
    
    53,016Property,
plant and equipment - net
    
    
    2,306
    
    
    
    485,002
    
    
    
    
    
    
    
    487,308Restricted cash
    
    
    
    
    
    
    12,502
    
    
    
    
    
    
    
    12,502Other non-current assets
    
    
    896
    
    
    
    39,308
    
    
    
    
    
    
    
    40,204Total assets
    
    $
    294,843
    
    
    $
    956,216
    
    
    $
    (295,700
    )
    
    $
    955,359Liabilities and stockholders equityAccounts payable
    
    $
    
    
    
    $
    92,434
    
    
    $
    
    
    
    $
    92,434Other current liabilities
    
    
    276
    
    
    
    116,429
    
    
    
    
    
    
    
    116,705Total current liabilities
    
    
    276
    
    
    
    208,863
    
    
    
    
    
    
    
    209,139Intercompany payable
    
    
    4,075
    
    
    
    
    
    
    
    (4,075
    )
    
    
    Long-term debt
    
    
    
    
    
    
    302,156
    
    
    
    
    
    
    
    302,156Other non-current liabilities
    
    
    14
    
    
    
    153,572
    
    
    
    
    
    
    
    153,586Stockholders equity
    
    
    290,478
    
    
    
    291,625
    
    
    
    (291,625
    )
    
    
    290,478Total liabilities and stockholders equity
    
    $
    294,843
    
    
    $
    956,216
    
    
    $
    (295,700
    )
    
    $
    955,359
 71




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CONDENSED CONSOLIDATING BALANCE SHEETReorganized Company December 31, 2003(Dollars in Thousands)ConsolidatingWPC and
    
    
    
    
    
    
    andSubsidiary
    
    
    
    
    
    
    Eliminating
    
    
    WPCGuarantors
    
    
    WPSC
    
    
    Entries
    
    
    ConsolidatedAssetsCash and cash equivalents
    
    $
    
    
    
    $
    4,767
    
    
    $
    
    
    
    $
    4,767Trade accounts receivables
    
    
    
    
    
    
    104,025
    
    
    
    
    
    
    
    104,025Inventories
    
    
    
    
    
    
    146,895
    
    
    
    
    
    
    
    146,895Other current assets
    
    
    12
    
    
    
    11,571
    
    
    
    
    
    
    
    11,583Total current assets
    
    
    12
    
    
    
    267,258
    
    
    
    
    
    
    
    267,270Intercompany receivables
    
    
    
    
    
    
    3,142
    
    
    
    (3,142
    )
    
    
    Investments and advances in affiliates
    
    
    104,967
    
    
    
    42,857
    
    
    
    (104,967
    )
    
    
    42,857Property,
plant and equipment - net
    
    
    2,521
    
    
    
    385,244
    
    
    
    
    
    
    
    387,765Restricted cash
    
    
    
    
    
    
    87,138
    
    
    
    
    
    
    
    87,138Other non-current assets
    
    
    896
    
    
    
    82,960
    
    
    
    
    
    
    
    83,856Total assets
    
    $
    108,396
    
    
    $
    868,599
    
    
    $
    (108,109
    )
    
    $
    868,886Liabilities and stockholders equityAccounts payable
    
    $
    
    
    
    $
    76,108
    
    
    $
    
    
    
    $
    76,108Other current liabilities

    
    
    281
    
    
    
    183,116
    
    
    
    
    
    
    
    183,397Total current liabilities
    
    
    281
    
    
    
    259,224
    
    
    
    
    
    
    
    259,505Intercompany payable
    
    
    3,142
    
    
    
    
    
    
    
    (3,142
    )
    
    
    Long-term debt
    
    
    
    
    
    
    340,696
    
    
    
    
    
    
    
    340,696Other non-current liabilities
    
    
    360
    
    
    
    163,712
    
    
    
    
    
    
    
    164,072Stockholders equity
    
    
    104,613
    
    
    
    104,967
    
    
    
    (104,967
    )
    
    
    104,613Total liabilities and stockholders equity
    
    $
    108,396
    
    
    $
    868,599
    
    
    $
    (108,109
    )
    
    $
    868,886
 72




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##### Table of Contents



CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONSReorganized Company Year EndedDecember 31, 2004(Dollars in Thousands)ConsolidatingWPC and
    
    
    
    
    
    
    andSubsidiary
    
    
    
    
    
    
    Eliminating
    
    
    WPCGuarantors
    
    
    WPSC
    
    
    Entries
    
    
    ConsolidatedIncome DataNet sales
    
    $
    
    
    
    $
    1,405,794
    
    
    $
    
    
    
    $
    1,405,794Cost of products sold
    
    
    
    
    
    
    1,206,773
    
    
    
    
    
    
    
    1,206,773Depreciation
and amortization expense
    
    
    
    
    
    
    33,433
    
    
    
    
    
    
    
    33,433Selling, administrative and general expense
    
    
    1,140
    
    
    
    66,117
    
    
    
    
    
    
    
    67,257Operating income (loss)
    
    
    (1,140
    )
    
    
    99,471
    
    
    
    
    
    
    
    98,331Interest expense
    
    
    
    
    
    
    (19,778
    )
    
    
    
    
    
    
    (19,778
    )Other income including equity earnings
of affiliates
    
    
    63,260
    
    
    
    17,520
    
    
    
    (63,260
    )
    
    
    17,520Income before income taxes
    
    
    62,120
    
    
    
    97,213
    
    
    
    (63,260
    )
    
    
    96,073Income tax provision (benefit)
    
    
    (347
    )
    
    
    33,953
    
    
    
    
    
    
    
    33,606Net income
    
    $
    62,467
    
    
    $
    63,260
    
    
    $
    (63,260
    )
    
    $
    62,467
 Five Months EndedDecember 31, 2003(Dollars in Thousands)ConsolidatingWPC and
    
    
    
    
    
    
    andSubsidiary
    
    
    
    
    
    
    Eliminating
    
    
    WPCGuarantors
    
    
    WPSC
    
    
    Entries
    
    
    ConsolidatedIncome DataNet sales
    
    $
    
    
    
    $
    396,902
    
    
    $
    
    
    
    $
    396,902Cost of products sold
    
    
    
    
    
    
    395,950
    
    
    
    
    
    
    
    395,950Depreciation and amortization expense
    
    
    
    
    
    
    10,473
    
    
    
    
    
    
    
    10,473Selling, administrative and general expense
    
    
    389
    
    
    
    23,175
    
    
    
    
    
    
    
    23,564Reorganization and professional fee expense
    
    
    (35
    )
    
    
    
    
    
    
    
    
    
    
    (35
    )Operating loss
    
    
    (354
    )
    
    
    (32,696
    )
    
    
    
    
    
    
    (33,050
    )Interest expense
    
    
    
    
    
    
    (10,215
    )
    
    
    
    
    
    
    (10,215
    )Other income including equity earnings
of affiliates
    
    
    (38,576
    )
    
    
    4,350
    
    
    
    38,576
    
    
    
    4,350Loss before income taxes
    
    
    (38,930
    )
    
    
    (38,561
    )
    
    
    38,576
    
    
    
    (38,915
    )Income tax provision
    
    
    
    
    
    
    15
    
    
    
    
    
    
    
    15Net loss
    
    $
    (38,930
    )
    
    $
    (38,576
    )
    
    $
    38,576
    
    
    $
    (38,930
    )
 73




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CONDENSED CONSOLIDATING STATEMENT OF OPERATIONSPredecessor Company Seven Months EndedJuly 31, 2003(Dollars in Thousands)ConsolidatingandSubsidiary
    
    
    Eliminating
    
    
    WPCWPC
    
    
    Guarantors
    
    
    Entries
    
    
    ConsolidatedIncome DataNet sales
    
    $
    
    
    
    $
    570,439
    
    
    $
    
    
    
    $
    570,439Cost of products sold
    
    
    (7,982
    )
    
    
    571,814
    
    
    
    
    
    
    
    563,832Depreciation and amortization expense
    
    
    
    
    
    
    39,889
    
    
    
    
    
    
    
    39,889Selling, administrative and general expense
    
    
    242
    
    
    
    29,664
    
    
    
    
    
    
    
    29,906Reorganization and professional fee expense
    
    
    
    
    
    
    8,140
    
    
    
    
    
    
    
    8,140Operating income (loss)
    
    
    7,740
    
    
    
    (79,068
    )
    
    
    
    
    
    
    (71,328
    )Interest expense
    
    
    
    
    
    
    (12,677
    )
    
    
    3,492
    
    
    
    (9,185
    )Other income including equity earnings
of affiliates
    
    
    319,540
    
    
    
    1,705
    
    
    
    (318,017
    )
    
    
    3,228Reorganization income (expense)Fair value adjustments
    
    
    
    
    
    
    (152,708
    )
    
    
    
    
    
    
    (152,708
    )Gain on discharge of debt
    
    
    
    
    
    
    557,541
    
    
    
    
    
    
    
    557,541Other reorganization entries
    
    
    (211
    )
    
    
    (4,547
    )
    
    
    
    
    
    
    (4,758
    )Income before income taxes
    
    
    327,069
    
    
    
    310,246
    
    
    
    (314,525
    )
    
    
    322,790Income tax provision (benefit)
    
    
    3,638
    
    
    
    (4,279
    )
    
    
    
    
    
    
    (641
    )Net income
    
    $
    323,431
    
    
    $
    314,525
    
    
    $
    (314,525
    )
    
    $
    323,431
 74




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CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONSPredecessor Company Year EndedDecember 31, 2002(Dollars in Thousands)ConsolidatingandSubsidiary
    
    
    Eliminating
    
    
    WPCWPC
    
    
    Guarantors
    
    
    Entries
    
    
    ConsolidatedIncome DataNet sales
    
    $
    
    
    
    $
    979,993
    
    
    $
    
    
    
    $
    979,993Cost of products sold
    
    
    620
    
    
    
    893,829
    
    
    
    
    
    
    
    894,449Depreciation and amortization expense
    
    
    
    
    
    
    74,194
    
    
    
    
    
    
    
    74,194Selling, administrative and general expense
    
    
    157
    
    
    
    46,836
    
    
    
    
    
    
    
    46,993Reorganization and professional fee expense
    
    
    
    
    
    
    11,755
    
    
    
    
    
    
    
    11,755Operating loss
    
    
    (777
    )
    
    
    (46,621
    )
    
    
    
    
    
    
    (47,398
    )Reorganization income
    
    
    845
    
    
    
    417
    
    
    
    
    
    
    
    1,262Interest expense
    
    
    
    
    
    
    (11,011
    )
    
    
    (4,976
    )
    
    
    (15,987
    )Other income including equity earnings
of affiliates
    
    
    (54,716
    )
    
    
    (8,681
    )
    
    
    67,964
    
    
    
    4,567Loss before income taxes
    
    
    (54,648
    )
    
    
    (65,896
    )
    
    
    62,988
    
    
    
    (57,556
    )Income tax provision (benefit)
    
    
    2,919
    
    
    
    (2,908
    )
    
    
    
    
    
    
    11Net loss
    
    $
    (57,567
    )
    
    $
    (62,988
    )
    
    $
    62,988
    
    
    $
    (57,567
    )
 75




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CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWSReorganized Company Year EndedDecember 31, 2004(Dollars in Thousands)ConsolidatingWPC and
    
    
    
    
    
    
    andSubsidiary
    
    
    
    
    
    
    Eliminating
    
    
    WPCGuarantors
    
    
    WPSC
    
    
    Entries
    
    
    ConsolidatedNet cash provided by operating activities
    
    $
    
    
    
    $
    72,025
    
    
    $
    
    
    
    $
    72,025Investing activities:Capital expenditures
    
    
    
    
    
    
    (132,442
    )
    
    
    
    
    
    
    (132,442
    )Construction of equipment using restricted cash
    
    
    
    
    
    
    74,636
    
    
    
    
    
    
    
    74,636Other
    
    
    (99,967
    )
    
    
    1,753
    
    
    
    99,967
    
    
    
    1,753Net cash used in investing activities
    
    
    (99,967
    )
    
    
    (56,053
    )
    
    
    99,967
    
    
    
    (56,053
    )Financing activities:Net borrowings
    
    
    
    
    
    
    (91,446
    )
    
    
    
    
    
    
    (91,446
    )Book overdraft
    
    
    
    
    
    
    2,208
    
    
    
    
    
    
    
    2,208Issuance of
common stock and paid in capital
    
    
    99,967
    
    
    
    99,697
    
    
    
    (99,967
    )
    
    
    99,697Net cash provided by financing activities
    
    
    99,967
    
    
    
    10,459
    
    
    
    (99,967
    )
    
    
    10,459Net change in cash and cash equivalents
    
    
    
    
    
    
    26,431
    
    
    
    
    
    
    
    26,431Cash and cash equivalents at beginning of period
    
    
    
    
    
    
    4,767
    
    
    
    
    
    
    
    4,767Cash and cash equivalents at end of period
    
    $
    
    
    
    $
    31,198
    
    
    $
    
    
    
    $
    31,198
 Five Months EndedDecember 31, 2003(Dollars in Thousands)ConsolidatingWPC and
    
    
    
    
    
    
    andSubsidiary
    
    
    
    
    
    
    Eliminating
    
    
    WPCGuarantors
    
    
    WPSC
    
    
    Entries
    
    
    ConsolidatedNet cash used in operating activities
    
    $
    (52
    )
    
    $
    (35,206
    )
    
    $
    
    
    
    $
    (35,258
    )Investing activities:Capital expenditures
    
    
    
    
    
    
    (37,828
    )
    
    
    
    
    
    
    (37,828
    )Construction of equipment using restricted cash
    
    
    
    
    
    
    24,862
    
    
    
    
    
    
    
    24,862Other
    
    
    
    
    
    
    325
    
    
    
    
    
    
    
    325Net cash used in investing activities
    
    
    
    
    
    
    (12,641
    )
    
    
    
    
    
    
    (12,641
    )Financing activities:Net borrowings
    
    
    
    
    
    
    42,127
    
    
    
    
    
    
    
    42,127Book overdraft
    
    
    
    
    
    
    3,157
    
    
    
    
    
    
    
    3,157Net cash provided by financing activities
    
    
    
    
    
    
    45,284
    
    
    
    
    
    
    
    45,284Net change in cash and cash equivalents
    
    
    (52
    )
    
    
    (2,563
    )
    
    
    
    
    
    
    (2,615
    )Cash and cash equivalents at beginning of period
    
    
    52
    
    
    
    7,330
    
    
    
    
    
    
    
    7,382Cash and cash equivalents at end of period
    
    $
    
    
    
    $
    4,767
    
    
    $
    
    
    
    $
    4,767
 76




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CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWSPredecessor Company Seven Months EndedJuly 31, 2003(Dollars in Thousands)ConsolidatingandSubsidiary
    
    
    Eliminating
    
    
    WPCWPC
    
    
    Guarantors
    
    
    Entries
    
    
    ConsolidatedNet cash provided by (used in) operating
activities
    
    $
    (115,882
    )
    
    $
    116,069
    
    
    $
    
    
    
    $
    187Investing activities:Capital expenditures
    
    
    
    
    
    
    (2,866
    )
    
    
    
    
    
    
    (2,866
    )Other
    
    
    (102,485
    )
    
    
    103,286
    
    
    
    
    
    
    
    801Net cash provided by (used in) used in investing
activities
    
    
    (102,485
    )
    
    
    100,420
    
    
    
    
    
    
    
    (2,065
    )Financing activities:Net borrowings
    
    
    
    
    
    
    390
    
    
    
    
    
    
    
    390Book overdraft
    
    
    
    
    
    
    327
    
    
    
    
    
    
    
    327Other
    
    
    218,382
    
    
    
    (218,382
    )
    
    
    
    
    
    
    Net cash provided by (used in) used in financing
activities
    
    
    218,382
    
    
    
    (217,665
    )
    
    
    
    
    
    
    717Net change in cash and cash equivalents
    
    
    15
    
    
    
    (1,176
    )
    
    
    
    
    
    
    (1,161
    )Cash and cash equivalents at beginning of period
    
    
    37
    
    
    
    8,506
    
    
    
    
    
    
    
    8,543Cash and cash equivalents at end of period
    
    $
    52
    
    
    $
    7,330
    
    
    $
    
    
    
    $
    7,382
 Year EndedDecember 31, 2002(Dollars in Thousands)ConsolidatingandSubsidiary
    
    
    Eliminating
    
    
    WPCWPC
    
    
    Guarantors
    
    
    Entries
    
    
    ConsolidatedNet cash used in operating activities
    
    $
    (4
    )
    
    $
    (15,039
    )
    
    $
    
    
    
    $
    (15,043
    )Investing activities:Capital expenditures
    
    
    
    
    
    
    (10,971
    )
    
    
    
    
    
    
    (10,971
    )Other
    
    
    
    
    
    
    1,320
    
    
    
    
    
    
    
    1,320Net cash used in investing activities
    
    
    

    
    
    
    (9,651
    )
    
    
    
    
    
    
    (9,651
    )Financing activities:Net borrowings
    
    
    
    
    
    
    24,694
    
    
    
    
    
    
    
    24,694Book overdraft
    
    
    
    
    
    
    957
    
    
    
    
    
    
    
    957Net cash provided by financing activities
    
    
    
    
    
    
    25,651
    
    
    
    
    
    
    
    25,651Net change in cash and cash equivalents
    
    
    (4
    )
    
    
    961
    
    
    
    
    
    
    
    957Cash and cash equivalents at beginning of period
    
    
    41
    
    
    
    7,545
    
    
    
    
    
    
    
    7,586Cash and cash equivalents at end of period
    
    $
    37
    
    
    $
    8,506
    
    
    $
    
    
    
    $
    8,543
 77




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23. Revenues by Product Revenues from external customers by product line were as follows: Reorganized Company
    
    
    
    Predecessor Company(Dollars in thousands)Year
    
    
    Five Months
    
    
    
    Seven Months
    
    
    YearEnded
    
    
    Ended
    
    
    
    Ended
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2004
    
    
    2003
    
    
    
    2003
    
    
    2002Product:Hot Rolled
    
    $
    365,089
    
    
    $
    85,305
    
    
    
    $
    106,545
    
    
    $
    179,530Cold Rolled
    
    
    514,511
    
    
    
    143,925
    
    
    
    
    243,841
    
    
    
    387,384Galvanized
    
    
    132,178
    
    
    
    22,575
    
    
    
    
    26,446
    
    
    
    62,712Fabricated products
    
    
    375,090
    
    
    
    137,137
    
    
    
    
    179,083
    
    
    
    306,254Coke and coke by products
    
    
    9,074
    
    
    
    5,752
    
    
    
    
    9,155
    
    
    
    15,408Conversion and other*
    
    
    9,852
    
    
    
    2,208
    
    
    
    
    5,369
    
    
    
    28,705Total
    
    $
    1,405,794
    
    
    $
    396,902
    
    
    
    $
    570,439
    
    
    $
    979,993
  *
    Includes conversion, semi-finished and resale products. 24. Selected Quarterly Financial Information (Unaudited) Financial results by quarter were as follows: Income (loss)
    
    
    
    
    
    
    Basic
    
    
    Fully Dilutedfrom
    
    
    Net
    
    
    Earnings
    
    
    EarningsContinuing
    
    
    Income
    
    
    (loss)
    
    
    (loss)Net Sales
    
    
    Operations
    
    
    (loss)
    
    
    Per Share
    
    
    Per Share(Dollars in thousands, except per share amounts)Predecessor Company20031st Quarter
    
    $
    238,672
    
    
    $
    (45,616
    )
    
    $
    (45,625
    )
    
    
    *
    
    
    
    *2nd Quarter
    
    
    250,469
    
    
    
    (22,112
    )
    
    
    (21,474
    )
    
    
    *
    
    
    
    *July
    
    
    81,298
    
    
    
    390,518
    **
    
    
    390,530
    
    
    
    *
    
    
    
    *Reorganized Company2003August and September
    
    $
    159,789
    
    
    $
    (15,231
    )
    
    $
    (15,237
    )
    
    $
    (1.60
    )
    
    $
    (1.60
    )4th Quarter
    
    
    237,113
    
    
    
    (23,678
    )
    
    
    (23,693
    )
    
    $
    (2.49
    )
    
    $
    (2.49
    )20041st Quarter
    
    $
    274,206
    
    
    $
    (6,705
    )
    
    $
    (6,626
    )
    
    $
    (0.70
    )
    
    $
    (0.70
    )2nd Quarter
    
    
    356,121
    
    
    
    39,035
    
    
    
    27,058
    
    
    $
    2.85
    
    
    $
    2.793rd Quarter
    
    
    401,800
    
    
    
    55,247
    
    
    
    35,590
    
    
    $
    3.53
    
    
    $
    3.424th Quarter
    
    
    373,667
    
    
    
    8,496
    
    
    
    6,445
    
    
    $
    0.46
    
    
    $
    0.46
  *
    Prior to July 31, 2003, earnings per share are not meaningful because the Company was
a wholly-owned subsidiary of WHX.**
    Includes reorganization income of $400,075. 78




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##### Table of Contents



Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None 
 Item 9A. CONTROLS AND PROCEDURES Conclusions Regarding the Effectiveness of Disclosure Controls and Procedures We carried out an evaluation, under the supervision and with the
participation of our management, including our Chief Executive Officer and Chief Financial Officer,
of the effectiveness of the design and operation of our disclosure controls and procedures as of
the end of the period covered by this annual report pursuant to Exchange Act Rule 13A-15. Based
upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our
disclosure controls and procedures were effective to ensure that material information relating to
us (including our subsidiaries) required to be included in our reports we file with the Securities
and Exchange Commission is processed, summarized and reported within the time periods specified in
the Securities and Exchange Commission rules and forms. Managements Report on Internal Control Over Financial Reporting Managements Report on Internal Control Over Financial Reporting is
included in this report in Item 8  Financial Statements and Supplemental DataManagements Report
on Internal Control Over Financial Reporting. Attestation Report of Registered Public Accounting Firm Managements assessment
of the effectiveness of the Companys internal control over financial
reporting as of December 31, 2004 has been audited by
PricewaterhouseCoopers LLP, an independent
registered public accounting firm. Their report is included in Item 8  Financial Statements and
Supplemental DataReport of Independent Registered Public Accounting Firm. Change in Internal Control Over Financial Reporting There have been no significant changes in internal control over
financial reporting that occurred during the fourth fiscal quarter that have materially affected,
or are reasonably likely to affect, the Companys internal control over financial reporting. 
 Item 9B. OTHER INFORMATION None 79




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PART III 
 Item 10. DIRECTORS AND OFFICERS OF THE COMPANY The following table sets forth
certain information with respect to directors and executive officers of WPC and WPSC as of February
28, 2005: Name
    
    Age
    
    PositionJames G. Bradley
    
    
    59
    
    
    Chairman of the Board and Class 3 Director of WPC,
President and Chief Executive Officer of WPC and
WPSC, Class 3 Director of WPC and Director of
WPSCPaul J. Mooney
    
    
    53
    
    
    Executive Vice President and Chief Financial
Officer
of WPC and WPSC, Class 1 Director of WPC and
Director of WPSCJohn W. Testa
    
    
    68
    
    
    Vice President, Secretary and Treasurer of WPC,
Senior Vice President, Chief Restructuring Officer
and Secretary of WPSC and Director of WPSCDaniel C. Keaton
    
    

    54
    
    
    Senior Vice President, Human Resources and Public
Relations of WPSCDonald E. Keaton
    
    
    46
    
    
    Vice President, Steel Manufacturing and
Procurement of WPSCHarry L. Page
    
    
    58
    
    
    Vice President, Engineering, Technology &
Metallurgy of WPSCJames E. Muldoon
    
    
    61
    
    
    Vice President, Business Development, of WPSCSteven W. Sorvold
    
    
    50
    
    
    Vice President, Commercial, of WPSC and Chief
Operating Officer of Wheeling Corrugating
CompanyMichael P. DiClemente
    
    
    51
    
    
    Treasurer of WPSCJames L. Bowen
    
    
    69
    
    
    Class 2 Director of WPCEdward J. Curry, Jr.
    
    
    58
    
    
    Class 3 Director of WPCMichael D. Dingman, Jr.
    
    
    51
    
    
    Class 2 Director of WPCRobert E. Heaton
    
    
    74
    
    
    Class 3 Director of WPCRoland L. Hobbs
    
    
    72
    
    
    Class 2 Director of WPC and Director of WPSCAlicia H. Munnell
    
    
    62
    
    
    Class 1 Director of WPCD. Clark Ogle
    
    
    58
    
    
    Class 2 Director of WPCJames B. Riley
    
    
    53
    
    
    Class 3 Director of WPCLynn R. Williams
    
    
    80
    
    
    Class 1 Director of WPC
 JAMES G. BRADLEY became a member of the Board of WPC in August 2003 and has been Chairman of the
Board since September 2003 and the President and Chief Executive Officer of WPC and WPSC since
April 1998. Mr. Bradley was an Executive Vice President of WHX Corporation from April 1998 to
August 2003. Previously, he was the President and Chief Operating Officer of Koppel Steel Company
from October 1997 to April 1998. From October 1995 to October 1997, Mr. Bradley served as Executive
Vice President  Operations of WPSC and as Vice President of WHX Corporation. Mr. Bradley has been
a director of WPSC since November 2000. PAUL J. MOONEY has been a director of WPC since August 2003 and an Executive Vice President and the
Chief Financial Officer of WPC and WPSC since October 1997. Previously, he served as the Vice
President of WHX Corporation from October 1997 to December 2001. From 1985 to November 1997, Mr.
Mooney was a Client Service and Engagement Partner of PricewaterhouseCoopers LLP. He also served,
from July 1996 to November 1997, as the National Director of Cross Border Filing Services with the
Accounting, Auditing and SEC Services Department of PricewaterhouseCoopers LLP, and from 1988 to
June 1996, as the Pittsburgh Site Leader of 80




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##### Table of Contents



PricewaterhouseCoopers LLPs Accounting and Business Advisory Services Department. Mr. Mooney has
been a director of WPSC since July 2003. JOHN W. TESTA has been a Vice President and the Secretary and Treasurer of WPC since July 2001.
Additionally, since July 2001, Mr. Testa has been a Senior Vice President and the Chief
Restructuring Officer and Corporate Secretary of WPSC. He served as a consultant from November
2000 to July 2001 and as Vice President  Office of the Chairman of WPC from February 1999 to
November 2000. Additionally, Mr. Testa served as Vice President, Secretary & Treasurer of WPSC
from February 1994 to February 1999 and as Vice President and Treasurer of WPSC from May 1980 to
February 1994. Mr. Testa has been a director of WPSC since July 2003. DANIEL C. KEATON has been the Senior Vice President, Human Resources and Public Relations of WPSC
since 1999, and he served as Vice President, Human Resources of WPSC from 1992 to 1999.
Previously, Mr. Keaton held various labor relations and human resources positions at WPSC from 1981
to 1992. DONALD E. KEATON has been the Vice President, Steel Manufacturing and Procurement of WPSC since
February 2001. Previously, he served as the Vice President, Primary Operations of WPSC from
October 1998 to February 2001, and as Division Manager  Iron making of WPSC from September 1997 to
October 1998. Prior to joining WPSC, Mr. Keaton was employed at AK Steel from June 1981 until
September 1997. Messrs. Daniel C. Keaton and Donald E. Keaton are not related. HARRY L. PAGE has been the Vice President, Engineering, Technology & Metallurgy of WPSC since
January 1999. From March 1998 to January 1999, he served as Vice President, Engineering and
Environmental Control of WPSC. Prior to joining WPSC, Mr. Page was the Senior Director,
Engineering, Cleveland works of LTV Steel Company, Inc. from December 1997 to March 1998 and the
General Manager of Engineering and Asset Management of LTV Steel from June 1993 to December 1997.
Mr. Page held various engineering positions of increasing responsibility at LTV Steel from 1968 to
1998. JAMES E. MULDOON has been the Vice President of WPSC since October 1997 and Division President of
Wheeling Corrugating Company, a division of WPSC, from August 2000 to October 2003. Mr. Muldoon
served as Vice President (and General Manager) of Wheeling Corrugating Company from October 1998 to
August 2000 and as Vice President of Purchasing, Traffic and Raw Materials of WPSC from October
1997 to October 1998. Prior to joining WPSC, Muldoon worked as the General Manager of Purchasing
for the former steel business (now known as United States Steel Corporation) of USX Corporation
(now known as Marathon Oil Corporation) from 1987 to 1997. STEVEN W. SORVOLD has been the Vice President, Commercial of WPSC since June 2003 and Chief
Operating Officer of Wheeling Corrugating Company since November 2003. From January 2002 to May
2003, he served as the General Manager, Commercial, Steel Division of WPSC, with responsibility for
all of WPSCs commercial operations. From March 2000 to January 2002, he was General Manager of
Custom and Specialty Products for Wheeling Corrugating Company, a division of WPSC. Previously, he
worked with Armco Steel Co. (now known as AK Steel Corporation) as General Manager, Sales and
Marketing, Coated Products from January 1995 to January 2000. In addition, Mr. Sorvold was
employed by National Steel Service Center and by United States Steel Corporation. MICHAEL P. DiCLEMENTE has been the Treasurer of WPSC since February 2004. Mr. DiClemente was
previously employed as an Investment Advisor by Yanni Partners, a national investment consulting
firm from 2002 to 2004. Previously, from 2001 to 2002, Mr. DiClemente served as Executive
Financial Consultant of Mitsubishi Corporation, a global trading company. Prior to that he served
Aristech Chemical Corporation for 14 years in a variety of finance positions, including most
recently, as Treasurer. Mr. DiClemente also served for nine years in a number of accounting and
finance positions at USX Corporation (now know as United States Steel Corporation). JAMES L. BOWEN became a director of WPC in August 2003. Since November 1997, Mr. Bowen served as
the President of the West Virginia AFL-CIO from November 1997 through August 2004. Previously, Mr.
Bowen served as Vice President for both the West Virginia and the Ohio AFL-CIO. Mr. Bowen was an
active member of the United Steelworkers of America for forty-two years, and an International
Representative for thirty-two years. He has been involved with the West Virginia AFL-CIO since
1965. Mr. Bowen has served as a director of WPSC 81




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from July 1998 to August 2003. Mr. Bowen is a
designee of the United Steelworkers of America to the WPC board of directors pursuant to the terms
of the collective bargaining agreement among the USWA, WPSC and WPC. EDWARD J. CURRY, JR. became a director of WPC in August 2003. Mr. Curry has worked as a management
consultant with Curry & Hurd LLC providing merger and acquisition, strategic planning and
operations consulting since October 2000. From September 1995 to September 2000, Mr. Curry served
as Executive Vice President and Chief Operating Officer of Moore Products Co. (acquired by Siemens
Energy & Automation, Inc. in February 2000), an international developer and manufacturer of process
measurement and control instrumentation, systems and dimensional measurement solutions. Mr. Curry
formerly was a certified public accountant in the State of Pennsylvania. MICHAEL D. DINGMAN, JR. became a director of WPC in August 2003. Since September 2000, Mr. Dingman
has served as the Chief Financial Officer of Intrado, Inc., a provider of 9-1-1 information
services and systems to telecommunications companies. Prior to joining Intrado, from March 1999 to
August 2000, Mr. Dingman had been the Chief Financial Officer and Treasurer of Internet Commerce
and Communication (formerly RMI NET, Inc.), which entered Chapter 11 of the United States
Bankruptcy Code in July 2001 and was purchased by ICC Speed Cell, LLC in October 2001 pursuant to a
bankruptcy court-approved asset purchase agreement. Mr. Dingmans prior work experience includes
five years of banking in merger and acquisitions with Lazard Freres in New York during the late
1980s, three years as an independent consultant specializing in debt restructuring and workouts
during the early 1990s and five years as an investment advisor specializing in corporate
retirement plans and high-net-worth accounts. ROBERT E. HEATON became a director of WPC in August 2003. Mr. Heaton has been a director of Blonder
Tongue Laboratories, Inc. since March 1998 and he also presently serves on the board of Calstrip
Steel Corp. In addition, Mr. Heaton has served on the board of directors of Bayou Steel
Corporation since 2002, and he was appointed as its chairman of the board of directors in July
2004. Bayou Steel Corporation filed a petition for
bankruptcy under Chapter 11 of the United States Bankruptcy Code in January 2003 and emerged from
Chapter 11 in February 2004. Mr. Heaton also became a director of Pittsburgh Alliance Co. in 2004.
From April 1993 through April 1995, Mr. Heaton served as Vice Chairman of the Stainless Steel
Group of Lukens, Inc. From April 1981 through April 1993, Mr. Heaton was President and Chief
Executive Officer of Washington Steel Corporation until it was acquired by Lukens, Inc. Mr. Heaton
is a past Chairman of the Specialty Steel Industry of North America. ROLAND L. HOBBS has been a director of WPC since 1998, and from 2000 to August 2003, he was a
director of WPSC. He was a director of WesBanco Inc., a multi-state bank holding company, from
1976 to April 2004 and Chairman of Oglebay Foundation, Inc. Mr. Hobbs is a member of the Wheeling
Park Commission. Mr. Hobbs has been a director of WPSC since July 2003 and had been a director of
WPSC for several years prior to our reorganization. ALICIA H. MUNNELL became a director of WPC in August 2003. Since 1997, Ms. Munnell has served as
the Peter F. Drucker Professor in Management Sciences at Boston Colleges Carroll School of
Management. Previously, Ms. Munnell was a member or the Presidents Council of Economic Advisers
and Assistant Secretary of the U.S. Treasury For Economic Policy. Ms. Munnell spent most of her
career at the Federal Reserve Bank of Boston where she became Senior Vice President and Director of
Research in 1984. Ms. Munnells husband is a partner at Bingham McCutchen LLP, a law firm retained
by us during the current and immediately prior fiscal year. D. CLARK OGLE became a director of WPC in August 2003. Since May 2004, Mr. Ogle has served as
Trustee of the Agway Liquidating Trust. Mr. Ogle served from August 2002 to June 2003 as the Chief
Executive Officer of Nationsrent, Inc., a $500 million publicly traded company which emerged from
Chapter 11 bankruptcy in June 2003. Previously, Mr. Ogle served as President and Chief Executive
Officer of Samsonite Commercial Furniture, Inc. from February 2002 to August 2002; as President and
Chief Executive Officer of Johnston Industries, a textile company, from March 1998 to July 2001;
and as Managing Director of KPMG Peat Marwick LLP, leading the Recovery Practice of the retail and
wholesale food industry, from October 1996 to March 1998. Prior to joining KPMG, he was President
and Chief Executive Officer of Teamsports, Inc., a sportswear distributor. In addition, Mr. Ogle
has held several other senior executive positions in the food and food distribution industry. JAMES B. RILEY became a director of WPC in August 2003. From January 2001 through August 2004, Mr.
Riley served as Senior Vice President and Chief Financial Officer of Chiquita Brands
International, Inc., which entered 82




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Chapter 11 of the U.S. Bankruptcy Code in November 2001 and
completed financial restructuring on March 19, 2002, when its pre-arranged plan of reorganization
under Chapter 11 became effective. Previously, Mr. Riley served as Senior Vice President and Chief
Financial Officer of the Elliott Company from May 1999 to January 2001; as Principal of James Burns
Riley & Associates from September 1998 to May 1999; and as Executive Vice President and Chief
Financial Officer of Republic Engineered Steels, Inc. from November 1989 to September 1998. Mr.
Riley has also held various positions with LTV Steel Company, including Manager of Financial
Analysis and Planning, Controller Coal Division, Manager of Seamless Pipe Operations, Assistant to
the President and Assistant Controller Raw Materials and Assistant Controller of the Bar Division. LYNN R. WILLIAMS became a director of WPC in August 2003. From 1997 to 2003, Mr. Williams served
as President of the Steelworkers Organization of Active Retirees. Previously, Mr. Williams was the
President Emeritus of the United Steelworkers of America, serving from November 1983 to March 1994.
Additionally, since March 1994, Mr. Williams has served as an arbitrator for the AFL-CIO under
Article XXI of its constitution. Mr. Williams has served on various boards of directors, including
the board of WPSC from January 2001 to
August 2003 and from July 1998 to November 2000, the board of WHX Corporation from December 1995 to
December 1997, the board of Republic Engineered Products LLC since August 2002, and the board of
Republic Technologies International from August 1999 to August 2002. Mr. Williams is a designee of
the United Steelworkers of America to the WPC Board of Directors pursuant to the terms of the
collective bargaining agreement among the USWA, WPSC and WPC. COMPOSITION OF THE BOARD OF DIRECTORS Our board of directors consists of eleven members, initially with staggered initial terms of office
as follows: Paul J. Mooney, Alicia H. Munnell and Lynn R. Williams initially served as directors
until the date of the 2004 annual meeting of stockholders at which time they were each re-elected
to serve as directors until the date of the 2005 annual meeting of stockholders; James L. Bowen,
Michael D. Dingman, Jr., Roland L. Hobbs and D. Clark Ogle will serve as directors until the date
of the 2005 annual meeting of stockholders; and James G. Bradley, Edward J. Curry, Jr., Robert E.
Heaton and James B. Riley will serve as directors until the date of the 2006 annual meeting of
stockholders. Upon the expiration of their respective terms of office set forth above, the
directors or their successors shall be elected as directors to serve only until the next annual
meeting of the stockholders, which means
that, beginning with the 2006 annual meeting of stockholders, all directors will be elected
annually to serve until the next annual meeting of stockholders. Until the 2006 annual meeting of stockholders, any director or the entire board may be removed only
for cause and only by the holders of at least a majority of the shares of common stock. Thereafter,
any director or the entire board may be removed with or without cause by the holders of at least a
majority of the shares of common stock. Pursuant to the collective bargaining agreement among the USWA, WPSC and WPC, the USWA has the
right to designate two individuals to serve on our board. The individuals identified to serve on
our board by the International President of the USWA must be acceptable to the chairman of the
board, whose acceptance must not be unreasonably withheld, and upon such acceptance, recommended by
the chairman to our boards nominating committee which, absent compelling reasons, must promptly
recommend such individual(s) to the full board for nomination to serve as a director. Once elected,
a USWA nominee serves a regular term as director. Messrs. Bowen and Williams currently serve as the
USWA designees to our board of directors. COMMITTEES OF THE BOARD OF DIRECTORS Our board of directors has established an audit committee, a compensation committee, a
nominating/governance committee, an executive committee, a safety committee and a finance
committee. Audit committee Our audit committee currently consists of Edward J. Curry, Jr., Michael D. Dingman, Jr., Robert E.
Heaton, Roland L. Hobbs and James B. Riley, each of whom is an independent director. The Companys
Board of Directors has determined that Mr. Riley is an audit committee financial expert, as
defined under SEC rules, and that he is independent, as determined under applicable NASD listing
standards. The audit committee is responsible for selecting our
independent registered public accounting firm and approving
the scope, fees and terms of all audit engagements and permissible 83




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non-audit services performed by
the independent auditor, as well as assessing the independence of our
independent registered public accounting firm from
management. The audit committee also assists the board in oversight of our financial reporting
process and integrity of its financial statements, and also reviews other matters with respect to
our accounting, auditing and financial reporting practices as it may find appropriate or may be
brought to our attention. Compensation committee Our compensation committee currently consists of James L. Bowen, Edward J. Curry, Jr., Alicia H.
Munnell and D. Clark Ogle, each of whom is an independent director. The compensation committee has
authority over all compensation matters for senior executives. It reviews executive salaries,
administers bonuses, incentive compensation and stock plans and approves the salaries and other
benefits of our executive officers. In addition, the compensation committee consults with our
management regarding our benefit plans and compensation policies and practices. Nominating/governance committee Our nominating/governance committee currently consists of Michael D. Dingman, Jr., Roland L. Hobbs
and D. Clark Ogle, each of whom is an independent director and is responsible for recommending to
the board proposed nominees for election to the board of directors. Additionally, this committee
conducts annual evaluations of our board of directors and its committees, and performs an annual
review of our corporate governance guidelines and code of business conduct and ethics, and
recommends changes as considered necessary and appropriate. Executive committee Our executive committee currently consists of James G. Bradley, Robert E. Heaton, Roland L. Hobbs
and James B. Riley and is authorized to act on behalf of the full board of directors between
regularly scheduled board meetings. Safety committee Our safety committee currently consists of James L. Bowen, James G. Bradley and Lynn R. Williams.
Such committee assists the board of directors in promoting the safety of our employees and assuring
compliance with applicable safety laws and regulations. In addition, the safety committee develops,
recommends to our board of directors, and oversees the implementation of such safety guidelines,
policies and procedures as it deems necessary. Finance committee Our finance committee currently consists of Robert E. Heaton, Paul J. Mooney, Alicia H. Munnell and
Lynn R. Williams. It oversees our financial objectives, policies, procedures and activities, and
advises our board of directors and management with respect to all activities, plans and policies
affecting our financial affairs. COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPANTS Our Compensation Committee reviews and acts on matters relating to compensation levels and benefit
plans for our key executives. The Compensation Committee during fiscal 2004 consisted of James L.
Bowen, Edward J. Curry, Jr., Alicia H. Munnell and D. Clark Ogle. No member of the compensation
committee has ever been an officer or employee of ours or any of our subsidiaries. We do not have
any compensation committee interlocks. Code of Ethics The Company has adopted a code of business conduct and ethics (the Company Code) that applies to
all of the Companys directors, executive officers and employees, and which meets the definition of
a code of ethics under applicable SEC rules. The Company Code is available free of charge under
the Investors Relations heading on the Companys Website at http://www.wpsc.com. The Company
intends to post on its Website any amendment to the Company Code, or any waiver from a provision of
the Company Code relating to the elements of a code of
ethics under SEC rules, where such waiver is to the Companys principal executive officer,
principal financial officer, principal accounting officer or controller (or persons performing
similar functions). 84




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Section 16(a) Beneficial Ownership Reporting Compliance Pursuant to Section 16(a) of the Exchange Act, the directors and executive officers and beneficial
owners of greater than 10% of the Companys Common Stock are required to file reports with the SEC
in respect of their ownership of the Companys securities. The Company believes that during fiscal
year 2004 all such required reports were filed on a timely basis, except for a Form 3Initial
Statement of Beneficial Ownership of Securities inadvertently filed late on behalf of Michael P.
DiClemente, an executive officer of the Company. 
 Item 11. EXECUTIVE COMPENSATION The following table sets forth information concerning the annual and long-term compensation in each
of the last three fiscal years for our Chief Executive Officer and our four other most highly
compensated executive officers. Summary Compensation Table Long-termCompensationAnnual Compensation
    
    
    RestrictedName and
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other Annual
    
    
    Stock
    
    
    All OtherPrincipal Position
    
    Year
    
    
    Salary
    
    
    Bonus
    
    
    Compensation (1)
    
    
    Awards (2)
    
    
    Compensation (3)James G. Bradley (10)
    
    
    2004
    
    
    $
    404,000
    
    
    $
    
    (4)
    
    $
    
    
    
    
    
    
    
    $
    35,025
    (5)(6)President and Chief Executive
    
    
    2003
    
    
    
    371,088
    
    
    
    
    
    
    
    
    
    
    $
    900,000
    
    
    
    34,500
    (5)(6)Officer of WPC and WPSC
    
    
    2002
    
    
    
    357,917
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    34,500
    (5)(6)Paul J. Mooney
    
    
    2004
    
    
    
    264,000
    
    
    
    44,000
    (4)(7)
    
    
    
    
    
    
    
    
    
    
    20,477
    (5)Executive Vice President and
    
    
    2003
    
    
    
    255,120
    
    
    
    44,000
    (7)
    
    
    
    
    
    
    642,855
    
    
    
    45,052
    (5)(8)Chief Financial Officer of
    
    
    2002
    
    
    
    246,068
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    45,057
    (5)(8)(9)WPC and WPSCDonald E. Keaton
    
    
    2004
    
    
    
    179,723
    
    
    
    28,800
    (4)(7)
    
    
    
    
    
    
    
    
    
    
    17,150
    (5)Vice President of WPSC
    
    
    2003
    
    
    
    171,808
    
    
    
    28,800
    (7)
    
    
    
    
    
    
    642,855
    
    
    
    14,900
    (5)2002
    
    
    
    160,053
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,831
    (5)Harry L. Page
    
    
    2004
    
    
    
    163,200
    
    
    
    27,200
    (4)(7)
    
    
    
    
    
    
    
    
    
    
    29,850
    (6)Vice President of WPSC
    
    
    2003
    
    
    
    157,657
    
    
    
    27,200
    (7)
    
    
    
    
    
    
    642,855
    
    
    
    29,850
    (6)2002
    
    
    
    151,505
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    29,719
    (6)Daniel C. Keaton
    
    
    2004
    
    
    
    158,400
    
    
    
    26,400
    (4)(7)
    
    
    
    
    
    
    
    
    
    
    18,025Senior Vice President
    
    
    2003
    
    
    
    147,641
    
    
    
    26,400
    (7)
    
    
    
    
    
    
    642,855
    
    
    
    14,025of WPSC
    
    
    2002
    
    
    
    147,641
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,025
   1.
    
    Excludes perquisites and other personal benefits unless the aggregate amount of such
compensation exceeds the lesser of either $50,000 or 10% of the total annual salary and bonus
reported for such named executive officer.2.
    
    Represents the dollar value of stock awards issued August 1, 2003, based on the stock price
at that time, pursuant to our restricted stock plan upon emergence from bankruptcy as an
incentive to remain with the Company. James G. Bradley was awarded 60,000 shares. Paul J.
Mooney, Harry L. Page, Donald E. Keaton and Daniel C. Keaton each received 42,857 shares.
One-third of such shares vested upon the closing of our underwritten public offering of common
stock in September 2004, and one-third will vest two business days after the date on which we
release earnings for the second quarter in each of 2005 and 2006. Based on the closing price
of WPC common stock at December 31, 2004, the dollar value of restricted stock holdings for
each named executive officer was as follows: $1,541,600 with respect to 40,000 restricted
shares held by Mr. Bradley, $1,101,165 with respect to 28,572 restricted shares held by Mr.
Mooney, $1,101,126 with respect to 28,571 restricted shares held by each of Mr. Donald Keaton,
Mr. Page, and Mr. Daniel Keaton. Shares of restricted stock awarded under the restricted
stock plan are entitled to received dividend, if any, declared on the common stock, except
where such restricted shares have been forfeited. 85




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3.
    
    Amounts shown, unless otherwise noted, reflect company contributions to qualified pension
plans.(4)
    
    Excludes a 2004 performance bonus awarded by the Compensation Committee of the Board of Directors
in February 2005 as follows: Mr. Bradley - $100,000, Mr. Mooney - $68,750, Mr. Donald Keaton - $45,000,
Mr. Page - $42,500, and Mr. Daniel Keaton - $41,250. Also excludes a discretionary EAF bonus awarded by the
Compensation Committee of the Board of Directors in February 2005 as follows: Mr. Bradley - $200,000,
Mr. Mooney - $137,500, Mr. Donald Keaton - $90,000, Mr. Page - $85,000 and Mr. Daniel Keaton - $82,500.5.
    
    Includes a payment from OCC of $5,000 paid as a Board Member Special Bonus.6.
    
    Includes a payment of $12,000 as a member of
the Board of Directors of Wheeling-Nisshin.7.
    
    Includes payments under terms of each executives employment agreement for supplemental
pension or life insurance coverage approved for payment by the Board of Directors, in cash, in
March, 2004 and January, 20058.
    
    Includes a payment of $25,000 in lieu of insurance premium in 2003 and 2002.9.
    
    Excludes the cash surrender value of $75,005 for an insurance policy purchased for Mr. Mooney
and transferred to him in 2002.10.
    
    Mr. Bradleys salary was increase to $520,000 per annum effective November 1, 2004. PENSION PLAN All salaried employees are covered by a defined contribution pension plan with contributions based
on age and salary. In 1998, we established a tax-qualified defined benefit plan (the Salaried
Pension Plan) covering salaried employees employed as of January 31, 1998, which provides a
guaranteed minimum benefit based on years of service and compensation. The total retirement benefit
payable from the Salaried Pension Plan is offset by (i) the annuitized value of the employees
defined contribution plan account balance, (ii) the employees accrued benefit payable by the PBGC
relating to a defined benefit pension plan terminated in 1985, and (iii) the employees accrued
benefit, as of July 31, 2003, under a WHX-sponsored pension plan (collectively the Offset
Amounts). The following table shows (without giving effect to the Offset Amounts) the estimated annual
retirement benefits in straight life annuity amounts payable to our salaried employees covered by
the Salaried Pension Plan upon normal retirement at age 62. Annual Estimated Benefits Years of Credited Service at Age 62Final Average Compensation
    
    15
    
    
    20
    
    
    25
    
    
    30
    
    
    35125,000
    
    
    24,375
    
    
    
    32,500
    
    
    
    40,625
    
    
    
    48,750
    
    
    
    56,875150,000
    
    
    29,250
    
    
    
    39,000
    
    
    
    48,750
    
    
    
    58,500
    
    
    
    68,250175,000
    
    
    34,125
    
    
    
    45,500
    
    
    
    56,875
    
    
    
    68,250
    
    
    
    79,625200,000
    
    
    39,000
    
    
    
    52,000
    
    
    
    65,000
    
    
    
    78,000
    
    
    
    91,000225,000
    
    
    39,000
    
    
    
    52,000
    
    
    
    65,000
    
    
    
    78,000
    
    
    
    91,000250,000
    
    
    39,000
    
    
    
    52,000
    
    
    
    65,000
    
    

    
    78,000
    
    
    
    91,000300,000
    
    
    39,000
    
    
    
    52,000
    
    
    
    65,000
    
    
    
    78,000
    
    
    
    91,000400,000
    
    
    39,000
    
    
    
    52,000
    
    
    
    65,000
    
    
    
    78,000
    
    
    
    91,000500,000
    
    
    39,000
    
    
    
    52,000
    
    
    
    65,000
    
    
    
    78,000
    
    
    
    91,000
 Compensation for pension calculation purposes includes base salary and periodic bonuses. Items
such as relocation allowance and leased automobile allowances are excluded. Compensation for all of
the named executive officers does not substantially differ from that set forth above in the Summary
Compensation Table except for the restrictions required by Internal Revenue Service statutory
limits. The years of credited service as of December 31, 2004 for each of the named executive officers were
as follows: James G. Bradley  9 years; Paul J. Mooney  7 years; Donald E. Keaton  7 years; and
Daniel C. Keaton  23 years. Benefits for the Salaried Pension Plan are computed by multiplying the employees final average
compensation by 1.3% multiplied by the number of years of continuous service at termination. This
amount is actuarially reduced for retirement prior to age 62 and is reduced by the Offset Amounts.
For purposes of computing benefits under the Salaried Pension Plan, the term final average
compensation means the highest consecutive 36 months of compensation in the final 120 months of
employment. 86




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CERTAIN BENEFIT PLANS We currently provide certain benefits to our eligible employees (including executive officers)
through the benefit plans described below. 2003 Management Stock Incentive Plan Our management stock incentive plan provides for the grant of incentive stock options, within the
meaning of Section 422 of the Internal Revenue Code, to employees of WPC and its affiliates,
including officers and employee directors. Non-qualified stock options and stock purchase rights,
including restricted stock and stock grants, may also be granted to employees, including officers
and directors and to non-employee directors and consultants. The board of directors or a designated
committee administers our management stock incentive plan and determines the terms of the options
or stock purchase rights granted, including the exercise price, the number of shares subject to
each option or stock purchase right, the vesting and the form of consideration payable upon such
exercise. 2003 Restricted Stock Plan In accordance with our plan of reorganization, we established a restricted stock plan pursuant to
which we have granted to selected key employees a total of 500,000 shares of our common stock. No
additional shares are authorized for issuance under the restricted stock plan. All of the grants
made under the plan will vest in increments of one-third of the total grant to each individual pro
rata over three years; one-third of which has vested and one-third of which will vest two business
days after the date on which we release earnings for the second quarter in each of 2005 and 2006.
The shares granted will not be transferable until they vest, and to the extent not vested at
termination of employment will be forfeited and returned to us. Until vested or forfeited, the
recipient of each grant under our restricted stock plan will be the owner of the shares granted,
with the right to vote and receive any dividends paid in respect of the shares. For further
information concerning securities authorized for issuance under equity compensation plans, see Item
12  Equity Compensation Plan Information. Employment Contracts, Termination of Employment and Change-in-Control Arrangements On February 16, 2005, an Amended and Restated Retention Agreement (each, an Agreement, and
collectively, the Agreements) was entered into with each of James G. Bradley, President and Chief
Executive Officer of the Company and Wheeling-Pittsburgh Steel Corporation, a wholly owned
subsidiary of the Company (WPSC); Paul J. Mooney, Executive Vice President and Chief Financial
Officer of the Company and WPSC; John W. Testa, Vice President, Secretary and Treasurer of the
Company and Senior Vice President, Chief Restructuring Officer and Corporate Secretary of WPSC;
Donald E. Keaton, Vice President, Steel Manufacturing and Procurement of WPSC; Harry L. Page, Vice
President, Engineering, Technology & Metallurgy of WPSC; Steven W. Sorvold, Vice President,
Commercial of WPSC and Daniel C. Keaton, Senior Vice President, Human Resources and Public
Relations of WPSC (each and Executive). The Agreements supersede, in their entirety, the
Post-Bankruptcy Retention Agreements, effective August 1, 2003, entered into with the Executives
pursuant to the Plan of Reorganization of the Company and its subsidiaries under Chapter 11 of the
US Bankruptcy Code. The Agreements provide for a minimum annual base salary beginning on August 1, 2003 (subject to
subsequent increases by the Board of Directors) of $400,000 for Mr. Bradley; $275,000 for Mr.
Mooney; $156,000 for Mr. Testa; $180,000 for Mr. Donald Keaton; $170,000 for Mr. Page; $165,000 for
Mr. Daniel Keaton; and $140,000 for Mr. Steven Sorvold, subject to annual review and upward
adjustment at the determination of the Board of Directors. Each Agreement has a stated term until
August 31, 2006, with an earlier termination in the event that the executives employment has been
terminated in accordance with the terms of the Agreement. Each Executive will be eligible to
receive annual bonuses and customary fringe benefits. In addition to annual bonuses, the
Agreements provide for a special one-time bonus equal to one-half of the Executives then annual
salary payable at the performance acceptance date (as defined) of WPSCs electric arc furnace
(which bonuses were paid in the first quarter of 2005, at the discretion of the Compensation
Committee). Further, in addition to customary fringe benefits, the Agreements, with the exception
of Mr. Bradleys, provide for an annual contribution of not less than $25,000 for nonqualified
supplemental pension or life insurance benefits for the benefit of each Executive. The Agreements provide for non-compete, non-solicitation and confidentiality provisions to protect
us. Each Agreement, with the exception of Mr. Bradleys, provides that immediately prior to the
expiration of the term, if the Executive is still employed and has not entered into a new
employment agreement or an extension of the existing agreement, the Executive will receive a
payment equal to monthly salary multiplied by the Executives number of 87




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years of service and
fractional year of service, up to a maximum of one times annual salary. This payment will be
reduced by any other cash severance payable to the Executive. The Executives employment may be terminated prior to the end of the term with or without cause,
as defined in each Agreement, and each Executive may resign with or without good reason, as
defined. No severance or other special termination payments will be made under the Agreements if
the Executive is terminated with cause or the Executive resigns without good reason. Pursuant to
the Agreements, with the exception of Mr. Bradleys, if the Executive is terminated without cause
or resigns for good reason, the Executive will receive a payment in an amount equal to his highest
annualized salary in effect during the one year period immediately preceding the termination date,
and will be entitled to receive payment of a pro rata bonus amount determined in accordance with
the applicable bonus plan. If the termination with cause or resignation for good reason occurs
within one year following a change of control (as defined in the Agreements) of the Company or
WPSC, the Executive will receive a payment equal to two times his highest annual salary in effect
during the one year immediately preceding the date of the change of control and will also be
entitled to a pro rata bonus amount. The Agreement provides for an equivalent change in control
severance benefit if the Executive resigns for any reason within the period of 30 days beginning
six months immediately following a change of control of the Company or WPSC. The Agreement also
entitles each Executive to the change of control severance payments described above even if the
termination occurs prior to the date of a change of control, in circumstances constituting good
reason, where it is reasonably demonstrated that such circumstances (i) occurred at the request of
a third party who has taken steps reasonably calculated to effect a change of control, or (ii)
otherwise arose in connection with or anticipation of a change of control. Under Mr. Bradleys
Agreement, upon any termination without cause or resignation for good reason, he will receive a
payment equal to three times his highest annualized salary in effect during the one year period
immediately preceding the termination date, and will be entitled to receive payment of a pro rata
bonus amount determined in accordance with the applicable bonus plan. Mr. Bradley also is entitled
to payment equal to three times his highest annualized salary in effect during the one year
immediately preceding the date of termination and a pro rata bonus amount upon any resignation
(whether with good reason or not) within six months following a change of control of the Company or
WPSC. In addition, the Agreements will terminate prior to their scheduled expiration date in the event of
an Executives death or disability. Upon a termination of the Executives employment due to his
disability, he will continue to receive his base salary and fringe benefits through the earlier of
his death or the date that the Executive becomes eligible for disability income under our existing
long-term disability plan or workers compensation plan.
Mr. Bradleys Agreement also provides for a supplemental pension benefit. Pursuant to his
Agreement, Mr. Bradley is entitled to receive a supplemental pension benefit upon his retirement or
other termination of his employment on or after the expiration date (August 31, 2006) in an annual
amount equal to 25% of his then-current salary. That amount will be payable annually for the
remainder of Mr. Bradleys life or ten years, whichever is longer. If Mr. Bradley retires or
otherwise terminates employment prior to the expiration date of his Agreement, his annual
supplemental pension payment will be reduced by two percentage points for each full or partial year
by which his service from August 1, 2003 through his termination is less than three years. Mr.
Bradley may elect to have his supplemental pension benefit paid in either a single lump sum (based
on reasonable actuarial assumptions) or in a series of equal monthly installments. On February 16, 2005, the Company entered into an agreement with James E. Muldoon, Vice President,
Business Development, of WPSC, providing for certain severance payments upon the occurrence of
specified events following, or in connection with, a change of control of the Company or WPSC. The
term of the agreement is until August 31, 2006, except as otherwise extended by agreement of the
parties, or in accordance with its terms in the event of a change of control. The terms and
conditions of the agreement are substantially similar to those governing change of control
severance payments payable to the Executives under the Agreements. DIRECTOR COMPENSATION Our employees that serve on our board of directors do not receive any additional compensation for
serving on our board or on any board committees. Non-employee directors receive an annual retainer
in the amount of $25,000, of which one-half is payable in cash and one-half is payable in stock
options. In addition, we pay annual retainers to committee chairpersons ranging in amount from
$2,500 to $5,000, also payable one-half in cash and one-half in stock options. Each director is
also compensated in the amount of $2,000, payable in cash, for attendance at each 88




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board and
committee meeting. Each member of our board of directors also receives an initial stock option
award valued at $1,000 upon becoming a director and an annual stock option award valued at $10,000.
The actual number of shares underlying the stock options issued to a director is determined by
dividing the dollar value of each award by one-half of the stocks market value for the five
trading days immediately prior to the grant date. The exercise price of such options is equal to
the average closing sales price of our common stock for the five trading days immediately prior to
the date of grant. We also reimburse directors for reasonable out-of-pocket expenses incurred in
attending meetings of our board of directors. Directors are also eligible to receive grants of
stock options and awards under our management stock incentive plan. 
 Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS Principal Stockholders The following table sets forth, as of February 28, 2005, certain information regarding beneficial
ownership of our common stock by:  
    each person known by us to beneficially own more than 5% of the outstanding shares of common stock;
    each member of our board of directors;
    each of the executive officers listed in the Summary Compensation Table in Item 10 above; and
    all of our directors and executive officers as a group. For purposes of this table, shares are considered beneficially owned if the person, either
directly or indirectly, has sole or shared power to direct the voting of the securities or has sole
or shared power to dispose or direct the disposition of the securities. A person is also considered
to beneficially own shares that such person has the right to acquire within 60 days after February
28, 2005. Unless otherwise indicated in a footnote, each individual or a group possesses sole
voting and investment power with respect to the shares indicated as beneficially owned. Common SharesBeneficially OwnedName and Address of Beneficial Owner
    
    Number
    
    

PercentageWheeling-Pittsburgh Steel Corporation Retiree Benefits Plan Trust(2)
    
    
    3,769,622
    
    
    
    26.12
    %Wellington Management Company, LLP (3)
    
    
    1,504,872
    
    
    
    10.43
    %Jeffery L. Gendell (4)
    
    
    1,390,278
    
    
    
    9.63
    %Spears Grisanti & Brown, LLC (5)
    
    
    762,360
    
    
    
    5.28
    %Jim Bowen (6)
    
    
    4,157
    
    
    
    *Edward J. Curry, Jr. (6)
    
    
    4,157
    
    
    
    *Michael Dingman (6)
    
    
    3,954
    
    
    
    *Robert E. Heaton (6)
    
    
    4,157
    
    
    
    *Roland L. Hobbs (6)
    
    
    4,157
    
    
    
    *Alicia H. Munnell (6)
    
    
    4,157
    
    
    
    *D. Clark Ogle (6)
    
    
    3,954
    
    
    
    *James B. Riley (6)
    
    
    4,361
    
    
    
    *Lynn R. Williams (6)
    
    
    3,954
    
    
    
    *James G. Bradley (7)
    
    
    40,000
    
    
    
    *Paul J. Mooney (7)
    
    
    28,572
    
    
    
    *Daniel C. Keaton (7)
    
    
    28,571
    
    
    
    *Donald E. Keaton (7)
    
    
    28,571
    
    
    
    *Harry L. Page (7)
    
    
    28,571
    
    
    
    *All executive officers and directors as a group (18 persons) (8)
    
    
    277,006
    
    
    
    1.92
    %
 89




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##### Table of Contents



*
    
    Less than 1%.(1)
    
    As December 31, 2004, approximately 53,052 shares of our common stock have been reserved
for issuance upon the resolution of certain disputed claims filed by our creditors. Shares of
common stock reserved for this purpose that are not ultimately required to be issued to satisfy
disputed claims will be distributed on a pro rata basis to the other members of that class of
creditors. Accordingly, as we settle disputed claims, the number of shares and the corresponding
percentage of common stock beneficially owned by certain persons listed in the table may increase
slightly over time without further action on the part of such persons.(2)
    
    Represents shares issued to the Retiree Benefits Plan, or VEBA trust. These shares are held of
record by WesBanco Bank, Inc., as trustee of the VEBA trust, which is subject to the direction of
US Trust Company, N.A. in its capacity as independent fiduciary for the VEBA trust, with respect to
the disposition and voting of the shares. The address of US Trust Company, N.A. is 600 14th Street,
N.W. Washington, D.C. 20005-3314. The address of the VEBA trust is c/o WesBanco Bank, Inc., as
trustee, One Bank Plaza, Wheeling, WV 26003.(3)
    
    The number of shares beneficially owned is based solely on information reported in an Amendment
No. 1 to Schedule 13G filed with the Securities and Exchange Commission by Wellington Management
Company, LLP on February 14, 2005 with respect to its holdings as of December 31, 2004. The address
of Wellington Management Company, LLP is 75 State Street, Boston, Massachusetts 02109.(4)
    
    Represents 523,813 shares held by Tontine Partners, L.P., 342,931 shares held by Tontine
Overseas Associates, L.L.C., and 523,534 shares held by Tontine Capital Management, L.L.C. Tontine
Management, L.L.C., the general partner of Tontine Partners, L.P., has the power to direct the
affairs of Tontine Partners, L.P., including decisions with respect to the disposition of the
proceeds from the sale of shares of common stock. Mr. Gendell is the managing member of Tontine
Management, L.L.C. and as such directs their operations and may be deemed to beneficially own all
523,813 shares held by Tontine Partners, L.P. In addition, Mr. Gendell is the managing member of
Tontine Overseas Associates, L.L.C., and Tontine Capital Management, L.L.C. and in that capacity
directs their operations and may be deemed to beneficially own all 342,931 shares and 523,534
shares held by Tontine Overseas Associates, L.L.C. and Tontine Capital Management, L.L.C.,
respectively. The foregoing management and ownership information is based in part upon disclosures
reported in Amendment No. 2 to Schedule 13G filed with the Securities and Exchange Commission on
February 14, 2005 by Mr. Gendell, individually, and as managing member of Tontine Management,
L.L.C., general partner of Tontine Partners, L.P., managing member of Tontine Capital Management,
L.L.C., and managing member of Tontine Overseas Associates, L.L.C.(5)
    
    The number of shares beneficially owned is based solely on information reported in a Amendment
No. 1 to Schedule 13G Initial Statement of Acquisition of Beneficial Ownership filed with the
Securities and Exchange Commission by Spears Grisanti & Brown LLC on February 11, 2005 with respect
to its holdings as of December 31, 2004. The address of Spears Grisanti & Brown LLC is 45
Rockefeller Plaza, New York, NY 10111.(6)
    
    Represents shares issuable upon exercise of currently exercisable options to purchase shares of
WPC common stock.(7)
    
    Represents shares originally issued under our 2003 Restricted Stock Plan.(8)
    
    Includes shares held by Messrs. Bowen, Curry, Dingman, Heaton, Hobbs, Ogle, Riley, Williams,
Bradley, Mooney, Keaton, Keaton and Page and Ms. Munnell reported as being beneficially owned by
each such person in the beneficial ownership table. The address of all such executive officers and
directors is c/o Wheeling-Pittsburgh Corporation, 1134 Market Street, Wheeling, WV 26003. 90




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Equity Compensation Plan Information The following table sets forth information regarding shares issued under equity compensation plans
as of December 31, 2004. Number of SecuritiesRemaining Availablefor Future Issuance(a) Number of
    
    
    
    
    
    
    under EquitySecurities to be
    
    
    
    
    
    
    Compensation PlansIssued Upon
    
    
    (b) Weighted Average
    
    
    (excludingExercise of
    
    
    Exercise Price of
    
    
    SecuritiesOutstanding Options,
    
    
    Outstanding Options,
    
    
    reflected inEquity Compensation Plans
    
    Warrants and Rights
    
    
    Warrants and Rights
    
    
    Column(a))Not approved by stockholders
    
    
    37,008
    
    
    $
    14.76
    
    
    
    962,992Approved by stockholders
    
    
    
    
    
    
    
    
    
    
    37,008
    
    
    $
    14.76
    
    
    
    962,992
   (1)
    
    Under the terms of the 2003 Management Stock Incentive Plan, the Company reserved
1,000,000 shares of Common Stock for issuance. Additionally, the Company reserved 500,000 shares
of Common Stock for issuance under the 2003 Restricted Stock Plan. However, all 500,000 reserved
shares were awarded, effective August 1, 2003, pursuant to our approved Plan of Reorganization and
no shares remain available for issuance under the Restricted Stock Plan. See Item 11  Executive
Compensation  2003 Management Stock Incentive Plan
and - 2003 Restricted Stock Plan for further
information regarding these equity compensation plans. 
 Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS The Company owns 35.7% of the outstanding common stock of Wheeling-Nisshin, Inc.
(Wheeling-Nisshin), which is accounted for using the equity method of accounting. The Company had
sales to Wheeling-Nisshin of $246.7 million, $61.7 million, $96.0 million and $152.5 million during
2004, the five months ended December 31, 2003, the seven months ended July 31, 2003 and for the
year ended December 31, 2002, respectively. Sales to Wheeling-Nisshin are made at prevailing
market prices. The Company received dividends from Wheeling-Nisshin of $2.5 million, $2.5 million
and $1.25 million during 2004, the seven months ended July 31, 2003 and the year ended December 31,
2002, respectively. At December 31, 2004, the Company had accounts receivable due from
Wheeling-Nisshin, Inc. of $1.6 million and had accounts payable to Wheeling-Nisshin of $2.5
million. The Company owns 50% of the outstanding common stock of Ohio Coatings Corporation (OCC), which is
accounted for using the equity method of accounting. The Company had sales to OCC of $121.1
million, $39.8 million, $68.2 million and $106.2 million during 2004, the five months ended
December 31, 2003, the seven months ended July 31, 2003 and the year ended December 31, 2002,
respectively. Sales to OCC are made at prevailing market prices. At December 31, 2004, the
Company had accounts receivable due from OCC of $9.7 million and had accounts payable to OCC of $.9
million. At December 31, 2004 has a loan receivable due from OCC of $9.7 million, which bears
interest at approximately 5% per annum. The Company recorded interest income on the loan
receivable of $.5 million. $.3 million, $.4 million and $.7 million during 2004, the five months
ended December 31, 2003, the seven months ended July 31, 2003 and the year ended December 31, 2002,
respectively, and received payments on the loan of $1.7 million. $.3 million and $.6 million during
2004, the five months ended December 31, 2003 and the seven months ended July 31, 2003,
respectively. James G. Bradley serves on
the board of directors of Wheeling-Nisshin and OCC. Harry L Page,
Vice President of Engineering, Technology and Metallurgy for WPSC,
serves on the board of directors of Wheeling-Nisshin. Paul J. Mooney,
our Executive Vice  President and Chief Financial Officer, and Donald
E. Keaton, Vice President of Steel Manufacturing and Procurement for
WPSC, serve on the board of directors of OCC. During the year ended December 31, 2004, we contributed an aggregate 169,622 shares of our common
stock to the VEBA trust in respect of our quarterly VEBA trust. See
Note 16 to the consolidated financial statements in Item 8 of this annual report Form 10-K for
further information concerning these contributions. 91




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##### Table of Contents



Item 14. PRINCIPAL ACCOUNTING FEES AND SERVICES The following fees were billed by PricewaterhouseCoopers LLP to the Company for services performed
on behalf of the Company, as described below: Audit Fees: The aggregate fees, including expenses, for professional services rendered by
PricewaterhouseCoopers LLP for the audit of the Companys annual financial statements for the year
ended December 31, 2004 and of its internal control over financial reporting as of December 31,
2004 were $1,140,918 of which $798,798 was billed in 2004. The aggregate fees for professional
services rendered by PricewaterhouseCoopers LLP for the audit of the Companys annual financial
statements for the year ended December 31, 2003 were $505,148 of which $373,398 was billed in 2003. Audit-Related Fees: The aggregate fees, including expenses, for professional services rendered by
PricewaterhouseCoopers LLP for audit-related services for the years ended December 31, 2004 and
December 31, 2003 were $105,000 and $82,345, respectively. These fees were for the audits of
employee benefit plans. Tax Fees: The aggregate fees, including expenses, for professional services rendered by
PricewaterhouseCoopers LLP for tax compliance, tax advice and tax planning for the year ended
December 31, 2004 and 2003 were $52,610 and $321,021, respectively. There were no tax services
rendered in 2002. All Other Fees: The aggregate fees, including expenses, for professional services rendered by
PricewaterhouseCoopers LLP, other than for services referred to
above, for the years ended December 31, 2004 and 2003 were
$10,500 and $36,885, respectively. PRE-APPROVAL OF AUDIT AND NON-AUDIT SERVICES The Companys Audit Committee has the sole authority to approve the scope, fees and terms of all
audit and permissible non-audit services provided by the
Companys independent registered public accounting firm, subject
to the de minimus exception under the Exchange Act permitting waiver of such pre-approval
requirements for non-audit services in certain limited instances. Pursuant to the Companys audit
committee charter, the Audit Committee considers whether the provision of non-audit services by the
independent registered public accounting firm, on an overall basis, is compatible with maintaining the independent
registered public accounting firm independence from management. None of the non-audit professional services rendered by
PricewaterhouseCoopers LLP in 2004 were approved pursuant to the de minimus exception described
above. 92




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##### Table of Contents



PART IV 
 Item 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES The financial statements, financial statement schedules and exhibits listed below are filed as
part of this annual report: (a)(1) Financial Statements Financial Statements filed as part of this report are included in
Item 8. Financial Statements and Supplementary Data beginning on
page 41. (a)     (3)     Exhibits Exhibits 10.6 and 10.7 and Exhibits 10.13(a) through 10.13(h) are management contracts or
compensatory plans or arrangements. EXHIBITNUMBER
    
    DESCRIPTION OF EXHIBIT2.1*
    
    Third Amended Joint Plan of Reorganization, dated May 19,2003.3.1(a)
    
    Second Amended and Restated Certificate of Incorporation (filed herewith).3.1(b)
    
    Certificate of Designation of Series A Junior Participating Preferred
Stock of Wheeling-Pittsburgh Corporation (filed herewith).3.2*
    
    Amended and Restated By-laws.4.1*
    
    Indenture, dated August 1, 2003, between Wheeling-Pittsburgh Steel
Corporation and Bank One, N.A., as trustee.4.2*
    
    Indenture, dated August 1, 2003, between Wheeling-Pittsburgh Steel
Corporation and Bank One, N.A., as trustee.4.3*
    
    Form of Common Stock Certificate of Wheeling-Pittsburgh Corporation.4.4***
    
    Rights Agreement, dated as of February 14, 2005, by and between
Wheeling-Pittsburgh Corporation and Equiserve Trust Company, N.A., as
Rights Agent.10.1*
    
    Close Corporation and Shareholders Agreement, dated as of March 24, 1994
(as amended), by and among Dong Yang Tinplate America Corp., Nippon Steel
Trading America, Inc. (f/k/a Nittetsu),
Wheeling-Pittsburgh Steel Corporation and Ohio Coatings Company.10.2*
    
    Raw Material Supply Agreement, dated as of March 25, 1994, by and between
Wheeling-Pittsburgh Steel Corporation and Ohio Coatings Company.10.3*
    
    Distribution Agreement, dated as of January 1, 2003 (as amended), by and
among Nippon Steel Trading America, Inc. (f/k/a Nittetsu Shoji America),
Wheeling-Pittsburgh Steel Corporation and Ohio Coatings Company.10.4*
    
    Second Amended and Restated Shareholders Agreement, dated as of November
12, 1990, by and between Wheeling-Pittsburgh Steel Corporation and
Nisshin Steel Co., Ltd.10.5*
    
    Amended and Restated Supply Agreement, dated as of March 29, 1993, by and
between Wheeling-Pittsburgh Steel Corporation and Wheeling-Nisshin, Inc.10.6*
    
    2003 Management Stock Incentive Plan.10.7*
    
    2003 Management Restricted Stock Plan.
 93




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##### Table of Contents



EXHIBITNUMBER
    
    DESCRIPTION OF EXHIBIT10.8*
    
    Term Loan Agreement, dated as of July 31, 2003, by and among
Wheeling-Pittsburgh Corporation, Wheeling-Pittsburgh Steel Corporation,
the several banks and other financial institutions or entities from time
to time party thereto, Lloyds TSB Bank PLC, as documentation agent,
Australia and New Zealand Banking Group Limited, as syndication agent,
Royal Bank of Canada, as administrative agent, Emergency Steel Loan
Guarantee Board, as federal guarantor, and West Virginia Housing
Development Group, as state guarantor.10.9*
    
    Revolving Loan Agreement, dated as of July 31, 2003, by and among
Wheeling-Pittsburgh Corporation, Wheeling-Pittsburgh Steel Corporation,
the banks and other financial institutions from time to time party
thereto, Royal Bank of Canada, as administrative agent, General Electric
Capital Corporation, as inventory and receivables security agent and
documentation agent, and The CIT Group/Business Credit, Inc., Congress
Financial Corporation and Fleet Capital Corp., as syndication agent.10.10*
    
    Modification and Assumption Agreement, dated as of June 12, 2003, between
Wheeling-Pittsburgh Steel Corporation and Danieli Corporation.10.11*
    
    Agreement for Supply of Equipment and Services, dated as of June 12,
2003, between Junction Industries, Inc. and Wheeling-Pittsburgh Steel
Corporation.10.12(a)*
    
    Lease for 201 Mississippi Street, Gary, IN, dated as of November 13,
1995, between Great Lakes Industrial Partners, L.P. and
Wheeling-Pittsburgh Steel Corporation, as amended.10.12(b)*
    
    Lease for 9801 Alden Avenue, Lenexa, KS, dated as of March 27, 2000,
between Lenexa Alden, LLC and Wheeling-Pittsburgh Steel Corporation.10.12(c)*
    
    Lease for 8090 Woolery Way, Fallon, NV, dated as of August 1, 1999,
between FBW Leasecorp, Inc. and Wheeling-Pittsburgh Steel Corporation.10.12(d)*
    
    Leases for 4204 Fidelity Road, Fidelity Industrial Park, Houston, TX,
dated January 16, 1986, and 4206-B Fidelity Road, Jacinto City, Harris
County, TX, dated September 21, 1988, between The Texas Development
Company and Wheeling-Pittsburgh Steel Corporation, as amended.10.12(e)*
    
    Lease for 20 Three Creek Road, Emporia, VA, dated August 17, 1998,
between the Industrial Development Authority of Greensville County,
Virginia and Wheeling Corrugating Company.10.12(f)*
    
    Lease for 2001 Highway 301, Palmetto, FL, dated April 27, 2000, between
Palmetto Business Park, LP and Wheeling-Pittsburgh Steel Corporation.10.13(a)
    
    Amended and Restated Retention Agreement, effective as of February 16,
2005, between James G. Bradley and Wheeling-Pittsburgh Steel Corporation
(filed herewith).10.13(b)
    
    Amended and Restated Retention Agreement, effective as of February 16,
2005, between Paul J. Mooney and Wheeling-Pittsburgh Steel Corporation
(filed herewith).10.13(c)
    
    Amended and Restated Retention Agreement, effective as of February 16,
2005, between Daniel C. Keaton and Wheeling-Pittsburgh Steel Corporation
(filed herewith).10.13(d)
    
    Amended and Restated Retention Agreement, effective as of February 16,
2005, between Donald E. Keaton and Wheeling-Pittsburgh Steel Corporation
(filed herewith).10.13(e)
    
    Amended and Restated Retention Agreement, effective as of February 16,
2005, between Harry L. Page and Wheeling-Pittsburgh Steel Corporation
(filed herewith).10.13(f)
    
    Amended and Restated Retention Agreement, effective as of February 16,
2005, between John W. Testa and Wheeling-Pittsburgh Steel Corporation
(filed herewith).10.13(g)
    
    Amended and Restated Retention Agreement, effective as of February 16,
2005, between Steven W. Sorvold and Wheeling-Pittsburgh Steel Corporation
(filed herewith).10.13(h)
    
    Agreement, effective as of February 16, 2005, between James E. Muldoon
and Wheeling-Pittsburgh Steel Corporation (filed herewith).10.14(a)*
    
    Registration Rights Agreement, dated as of August 1, 2003, between
Wheeling-Pittsburgh Corporation, Wheeling-Pittsburgh Steel Corporation,
Stonehill Institutional Partners, L.P. and Stonehill Offshore Partners
Limited.10.14(b)*
    
    Registration Rights Agreement, dated August 1, 2003 between
Wheeling-Pittsburgh Corporation and WesBanco Bank, Inc., solely in its
capacity as trustee under the VEBA trust.
 94




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##### Table of Contents



EXHIBITNUMBER
    
    DESCRIPTION OF EXHIBIT10.14(c)*
    
    Stock Transfer Restriction and Voting Agreement, dated August 1, 2003, by
and among Wheeling-Pittsburgh Corporation and WesBanco Bank, Inc., solely
in its capacity as trustee under the VEBA trust.10.15**
    
    First Amendment and Waiver, dated June 25, 2004, to the Term Loan
Agreement, dated as of July 31, 2003, among Wheeling-Pittsburgh
Corporation, Wheeling-Pittsburgh Steel Corporation, the Lenders party
thereto, the Documentation Agent and Syndication Agent named therein,
Royal Bank of Canada, as administrative agent, the Emergency Steel Loan
Guarantee Board and the West Virginia Housing Development Fund.10.16**
    
    First Amendment, dated June 25, 2004, to the Revolving Loan Agreement,
dated as of July 31, 2003, among Wheeling-Pittsburgh Corporation,
Wheeling-Pittsburgh Steel Corporation, the Lenders party thereto, the
agents named therein and Royal Bank of Canada, as administrative agent.10.17
    
    Second Amendment, effective as of December 30, 2004, to the Term Loan
Agreement, dated as of July 31, 2003 (as amended), among
Wheeling-Pittsburgh Corporation, Wheeling-Pittsburgh Steel Corporation,
Royal Bank of Canada, as administrative agent, the Lenders party thereto,
the Emergency Steel Loan Guarantee Board and the West Virginia Housing
Development Fund (filed herewith).10.18
    
    Second Amendment, effective as of December 30, 2004, to the Revolving
Loan Agreement, dated as of July 31, 2003 (as amended), among
Wheeling-Pittsburgh Corporation, Wheeling-Pittsburgh Steel Corporation,
Royal Bank of Canada, as administrative agent, and the Lenders party
thereto (filed herewith).10.19
    
    Letter of Intent, entered into on December 23, 2004, by and between
Wheeling-Pittsburgh Steel Corporation and Severstal North America, Inc.
(filed herewith).21.1**
    
    Subsidiaries of Wheeling-Pittsburgh Corporation.23.1
    
    Consent of PricewaterhouseCoopers LLP, independent registered public
accounting firm (filed herewith).31.1
    
    Certification of James G. Bradley, Chief Executive Officer of the
Registrant required by Rule 13a-14(a) or 15d-14(a) of the Securities
Exchange Act of 1934, pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002 (filed herewith).31.2
    
    Certification of Paul J. Mooney, Chief Financial Officer of the
Registrant required by Rule 13a-14(a) or 15d-14(a) of the Securities
Exchange Act of 1934, pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002 (filed herewith).32.1
    
    Certification of James G. Bradley, Chief Executive Officer of the
Registrant pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).32.2
    
    Certification of Paul J. Mooney, Chief Financial Officer of the
Registrant pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).
   *
    
    Incorporated by reference to the Form 10 Registration Statement (File No. 0-50300) of
Wheeling-Pittsburgh Corporation, filed with the SEC on August 8, 2003, as amended.**
    
    Incorporated by reference to the Form S-1 Registration Statement (File No. 333-116990) of
Wheeling-Pittsburgh Corporation, filed with the SEC on June 30, 2004, as amended.***
    
    Incorporated by reference to the Form 8-A Registration Statement (File No. 0-50300), filed
with the SEC on February 18, 2005. 95




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SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the
registrant has duly caused this annual report on Form 10-K to be signed on its behalf by the
undersigned, thereunto duly authorized. WHEELING-PITTSBURGH CORPORATIONBy:
    
    /s/ James G. BradleyName: James G. BradleyTitle: President, Chief Executive Officer and DirectorDate: March 14, 2005
 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed
below by the following persons on behalf of the registrant and in the capacities and on the dates
indicated. Signature
    
    Title
    
    Date/s/ James G. Bradley

James G. Bradley
    
    President, Chief Executive Officer
and Director
    
    March 14, 2005/s/ Paul J. Mooney

Paul J. Mooney
    
    Executive Vice President, Chief Financial
Officer (and Principal Accounting
Officer) and Director
    
    March 14, 2005/s/ Jim Bowen

Jim Bowen
    
    Director
    
    March 14, 2005/s/ Edward J. Curry, Jr.

Edward J. Curry, Jr.
    
    Director
    
    March 14, 2005/s/ Michael Dingman

Michael Dingman
    
    Director
    
    March 14, 2005/s/ Robert E. Heaton

Robert E. Heaton
    
    Director
    
    March 14, 2005/s/ Roland L. Hobbs

Roland L. Hobbs
    
    Director
    
    March 14, 2005/s/ Alicia H. Munnell

Alicia H. Munnell
    
    Director
    
    March 14, 2005/s/ D. Clark Ogle

D. Clark Ogle
    
    Director
    
    March 14, 2005/s/ James B. Riley

James B. Riley
    
    Director
    
    March 14, 2005/s/ Lynn R. Williams

Lynn R. Williams
    
    Director
    
    March 14, 2005
 96