##### Table of Contents



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, 2005
 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
(State of Incorporation)1134 Market Street, Wheeling, WV
(Address of principal executive offices)
    
    55-0309927
(I.R.S. Employer Identification No.)26003
(Zip code)
    Common Stock, $0.01 par value per share
    
    Rights to Purchase Series A Junior Participating
Preferred Stock(Title of class)
    
    (Title of class)
 o þ
 o þ
 þ o
 o
 o þ
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
  Applicable only to registrants involved in bankruptcy proceedings during the preceding five years:
 þ o
  Documents Incorporated by Reference: None




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##### Table of Contents



TABLE OF CONTENTS
 PAGEPART IItem 1.
    
    Business
    
    
    1Item 1A.
    
    Risk Factors
    
    
    16Item 1B.
    
    Unresolved Staff Comments
    
    
    21Item 2.
    
    Properties
    
    
    21Item 3.
    
    Legal Proceedings
    
    
    22Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    24PART IIItem 5.
    
    Market for
Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
    
    
    25Item 6.
    
    Selected Financial Data
    
    
    26Item 7.
    

Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    29Item 7A.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    44Item 8.
    
    Financial Statements and Supplementary Data
    
    
    45Item 9.
    
    Changes in
and Disagreements With Accountants on Accounting and Financial Disclosure
    
    
    89Item 9A.
    
    Controls and Procedures
    
    
    89Item 9B.
    
    Other Information
    
    
    89PART IIIItem 10.
    
    Directors and Executive Officers of the Registrant
    
    
    90Item 11.
    
    Executive Compensation
    
    
    95Item 12.
    
    Security
Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
    
    
    99Item 13.
    
    Certain Relationships and Related Transactions
    
    
    102Item 14.
    
    Principal Accounting Fees and Services
    
    
    103PART IVItem 15.
    
    Exhibits and Financial Statement Schedules
    
    
    104Signatures
    
    
    
    
    107EX-10.12(B)EX-10.12(C)EX-10.12(D)EX-10.12(E)EX-10.12(F)EX-10.12(G)EX-10.12(I)EX-10.20EX-10.21EX-10.22EX-21.1EX-23.1EX-31.1EX-31.2EX-32.1EX-32.2




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PART I
 
 Item 1. BUSINESS
 Overview
  ®
   Recent Developments
 Background
   1




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Industry and Production
      Potential Insurance Recovery
  Raw Materials, Coke Production and Coal Supply
  2




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Joint Venture
    Credit Arrangements and Covenant Compliance
   Business Strategy
  Transition to electric arc furnace production
  3




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Strategic capital projects to improve productivity and cost position
  Capitalize on our excess coke capacity
    Achieve balanced exposure to spot and contract business
  4




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Optimize the sale of downstream value-added products
  Steel Industry
      Industry Consolidation
  5




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Imports
   Raw Material Pricing
   Segments and Geographic Area
  6




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Products and product mix
  Year EndedDecember 31,2005
    
    
    2004
    
    
    2003Product Category:Higher value added products as a percentage of total shipments:Cold rolled products  trade
    
    
    6.5
    %
    
    
    8.0
    %
    
    
    11.0
    %Cold rolled products  Wheeling-Nisshin
    
    
    17.3
    %
    
    
    19.3
    %
    
    
    19.6
    %Coated products
    
    
    7.1
    %
    
    
    8.7
    %
    
    
    4.9
    %Tin mill products
    
    
    11.9
    %
    
    
    13.6
    %
    
    
    13.1
    %Fabricated products
    
    
    21.6
    %
    
    
    19.7
    %
    
    
    21.8
    %Higher value-added products
    
    
    64.4
    %
    
    
    69.3
    %
    
    
    70.4
    %Hot rolled products
    
    
    35.6
    %
    
    
    30.7
    %
    
    
    29.6
    %Total
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Average net sales per ton of steel products sold
    
    $
    686
    
    
    $
    661
    
    
    $
    435
 Hot Rolled Products
  Cold Rolled Products
  Coated Products
  Tin Mill Products
  Fabricated Products
  Construction Products
  7




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Agricultural Products
  Specialty Products
   Reorganized
    


    
    PredecessorCompany
    


    
    Company(Dollars in thousands)Five Months
    


    
    Seven MonthsYear Ended
    
    
    Ended
    


    
    EndedDecember 31,
    
    
    December 31,
    
    
    December 31,
    


    
    July 31,2005
    
    
    2004
    
    
    2003
    


    
    2003Product:Hot rolled
    
    $
    420,745
    
    
    $
    365,089
    
    
    
    85,305
    


    
    $
    106,545Cold rolled
    
    
    471,235
    
    
    
    514,511
    
    
    
    143,925
    


    
    
    243,841Galvanized
    
    
    109,264
    
    
    
    132,178
    
    
    
    22,575
    


    
    
    26,446Fabricated products
    
    
    466,914
    
    
    
    375,090
    
    
    
    137,137
    


    
    
    179,083Ore, coke and coke by products
    
    
    85,268
    
    
    
    9,074
    
    
    
    5,752
    


    
    
    9,155Conversion and other (1)
    
    
    7,087
    
    
    
    9,852
    
    
    
    2,208
    


    
    
    5,369$
    1,560,513
    
    
    $
    1,405,794
    
    
    $
    396,902
    


    
    $
    570,439
 
 (1)
    
    Includes conversion and resale products. Customers and Markets
   8




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Percentage of Total Tons ShippedYear EndedDecember 31,2005
    
    
    2004
    
    
    2003Steel service centers
    
    
    29
    %
    
    
    28
    %
    
    
    27
    %Converters and processors (1)
    
    
    28
    %
    
    
    29
    %
    
    
    28
    %Construction
    
    
    21
    %
    
    
    18
    %
    
    
    20
    %Agriculture
    
    
    5
    %
    
    
    5
    %
    
    
    3
    %Containers (1)
    
    
    13
    %
    
    
    16
    %
    
    
    16
    %Other
    
    
    4
    %
    
    
    4
    %
    
    
    6
    %Total
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
 
 (1)
    
    Products shipped to Wheeling-Nisshin and OCC are included primarily in the converters
and processors and containers markets, respectively.  Steel Service Centers
  Converters and Processors
  Construction
  Agriculture
  Containers
  Joint Ventures
 Wheeling-Nisshin
  9




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
    
    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.
  Ohio Coatings Company
   10




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
    
    Any pledge, transfer or other distribution of shares of OCC must
be previously approved by shareholders holding at least 66.67% 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.
    Mountain State Carbon
    11




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Competition
  
    
    quality;
 
    
    reliability;
 
    
    product market price;
 
    
    product offerings;
 
    
    location and shipping costs; and
 
    
    raw material and operating costs.
 12




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
    
    domestic integrated steel producers, such as United States Steel Corporation, Mittal Steel USA, Inc., AK Steel
Corporation and SNA;
 
    
    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.
    Sales and Marketing
    13




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Manufacturing Process
     Raw Materials
      14




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Energy
  Backlog
  Employees
  Cautionary Statement Concerning Forward-Looking Statements
   Available Information
 www.sec.gov,
 15




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Item 1A. Risk Factors
  We emerged from Chapter 11 bankruptcy reorganization in August 2003, incurred a current-period loss
and have sustained losses in the past, and may not be able to achieve profitability on a consistent
basis.
   We may not be able to comply with our financial covenants, which may result in a default under our
credit agreements.
    Restrictive covenants in our debt instruments limit our flexibility and our ability to implement
our business plan.
  16




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Because we are significantly leveraged, we may not be able to implement our business plan, service
our debt obligations or refinance our indebtedness.
   Intense competition in the steel industry and substitute materials could adversely affect our
profitability.
  Increased imports from China or other countries could lower domestic steel prices and adversely
affect our profitability.
   17




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We may be unsuccessful in the final ramp-up to full operation of our electric arc furnace, which
would adversely affect our business prospects and competitive position in the industry.
  Any decrease in the availability, or increase in the cost, of raw materials and energy could
materially increase our costs and adversely affect our profitability.
    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.
  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.
  18




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We may not be able to implement our business plan because we may be unable to fund the substantial
ongoing capital and maintenance expenditures that our operations require.
  A significant interruption or casualty loss at any of our facilities could increase our production
costs and reduce our sales and earnings.
   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.
  Environmental compliance and remediation costs could decrease our net cash flow, reduce our results
of operations and impair our financial condition.
  19




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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 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.
  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.
  Certain U.S. federal income tax considerations may increase the amount of taxes we pay which could
adversely affect our liquidity and reduce profitability.
  20




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Future sales of our common stock by our existing stockholders could adversely affect the market
price of our common stock.
   
 Item 1B. Unresolved Staff Comments
 .
 
 Item 2. PROPERTIES
 Primary Steel-producing Facility
  21




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Other Plants
  CapacityLocations and Operations
    
    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
annealing
lines
    
    
    660,000
    
    
    Blackplate and cold rolled sheets
     
 Item 3. LEGAL PROCEEDINGS
  Breach of Contract
  22




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Environmental Matters
        23




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Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  24




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PART II
 
 Item 5.
    
    MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
REPURCHASES OF EQUITY SECURITIES
   High
    
    
    LowYear ended December 31, 2005:Fourth quarter
    
    $
    16.70
    
    
    $
    8.03Third quarter
    
    $
    20.82
    
    
    $
    14.62Second quarter
    
    $
    33.10
    
    
    $
    15.29First quarter
    
    $
    44.82
    
    
    $
    29.42Year ended December 31, 2004:Fourth quarter
    
    $
    41.86
    
    
    $
    26.48Third quarter
    
    $
    31.31
    
    
    $
    19.75Second quarter
    
    $
    22.85
    
    
    $
    12.93First quarter
    
    $
    24.82
    
    
    $
    18.56
  Dividend policy
  Adoption of Shareholder Rights Plan
 th
 25




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Item 6. SELECTED FINANCIAL DATA
 
   26




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Reorganized Company
    
    
    
    Predecessor Company(Dollars in thousands, except per share amounts)Five Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    Ended
    
    
    Year EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003
    
    
    2002
    
    
    2001Consolidated Statement of
Operations Data:Net sales, including sales to
affiliates of $343,546, $367,735,
$101,501, $164,273, $258,681
and $204,537
    
    $
    1,560,513
    
    
    $
    1,405,794
    
    
    $
    396,902
    
    
    
    $
    570,439
    
    
    $
    979,993
    
    
    $
    835,640Cost of sales, excluding
depreciation, including cost of
of sales to affiliates of $346,057,
$324,813, $91,262, $143,840,
$238,937 and $204,107
    
    
    1,479,474
    
    
    
    1,206,773
    
    
    
    395,950
    
    
    
    
    563,832
    
    
    
    894,449
    
    
    
    866,065Depreciation and amoritization
expense
    
    
    33,984
    
    
    
    33,433
    
    
    
    10,473
    
    
    
    
    39,889
    
    
    
    74,194
    
    
    
    72,551Selling, general and administrative
expense
    
    
    71,552
    
    
    
    67,620
    
    
    
    23,671
    
    
    
    
    29,906
    
    
    
    46,993
    
    
    
    47,173Reorganization and professional fee
expense
    
    
    
    
    
    
    
    
    
    
    (35
    )
    
    
    
    8,140
    
    
    
    11,755
    
    
    
    14,200Operating income (loss)
    
    
    (24,497
    )
    
    
    97,968
    
    
    
    (33,157
    )
    
    
    
    (71,328
    )
    
    
    (47,398
    )
    
    
    (164,349
    )Interest expense and other financing
costs
    
    
    (21,834
    )
    
    
    (19,778
    )
    
    
    (10,215
    )
    
    
    
    (9,185
    )
    
    
    (15,987
    )
    
    
    (17,448
    )Other income
    
    
    11,843
    
    
    
    17,520
    
    
    
    4,350
    
    
    
    
    3,228
    
    
    
    4,567
    
    
    
    351Reorganization adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    400,075
    
    
    
    1,262
    
    
    
    9,249Income (loss) before taxes
    
    
    (34,488
    )
    
    
    95,710
    
    
    
    (39,022
    )
    
    
    
    322,790
    
    
    
    (57,556
    )
    
    
    (172,197
    )Tax provision (benefit)
    
    
    (71
    )
    
    
    33,479
    
    
    
    15
    
    
    
    
    (641
    )
    
    
    11
    
    
    
    17Income (loss) before minoirty
interest
    
    
    (34,417
    )
    
    
    62,231
    
    
    
    (39,037
    )
    
    
    
    323,431
    
    
    
    (57,567
    )
    
    
    (172,214
    )Minority interest in loss of
consolidated subsidiary
    
    
    583
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net income (loss)
    
    $
    (33,834
    )
    
    $
    62,231
    
    
    $
    (39,037
    )
    
    
    $
    323,431
    
    
    $
    (57,567
    )
    
    $
    (172,214
    )Earnings (loss) per share:Basic
    
    $
    (2.37
    )
    
    $
    5.78
    
    
    $
    (4.11
    )
    
    
    
    *
    
    
    
    *
    
    
    
    *Fully diluted
    
    $
    (2.37
    )
    
    $
    5.66
    
    
    $
    (4.11
    )
    
    
    
    *
    
    
    
    *
    
    
    
    *Average basic shares outstanding
(in thousands)
    
    
    14,302
    
    
    
    10,759
    
    
    
    9,500
    
    
    
    
    *
    
    
    
    *
    
    
    
    *Average diluted shares outstanding
(in thousands)
    
    
    14,302
    
    
    
    11,002
    
    
    
    9,500
    
    
    
    
    *
    
    
    
    *
    
    
    
    *
 
 *
    
    Prior to reorganization, WPC was a wholly-owned subsidiary of WHX Corporation. 27




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Reorganized Company
    
    
    
    Predecessor Company(Dollars in thousands, except per share amounts)Five Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    Ended
    
    
    Year EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,
    
    
    December 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003
    
    
    2002
    
    
    2001Consolidated Operating
and Other Data:Employment:Employment costs
    
    $
    271,962
    
    
    $
    239,236
    
    
    $
    94,651
    
    
    
    $
    143,265
    
    
    $
    248,829
    
    
    $
    253,529Average number of employees
    
    
    3,306
    
    
    
    3,280
    
    
    
    3,299
    
    
    
    
    3,621
    
    
    
    3,796
    
    
    
    3,701Production and Shipments:Production  tons
    
    
    2,452,131
    
    
    
    2,362,886
    
    
    
    958,816
    
    
    
    
    1,399,853
    
    
    
    2,527,826
    
    
    
    2,266,605Shipments  tons
    
    
    2,164,404
    
    
    
    2,125,434
    
    
    
    912,937
    
    
    
    
    1,305,046
    
    
    
    2,213,506
    
    
    
    2,027,037Average sales price per ton of
steel shipped
    
    $
    686
    
    
    $
    661
    
    
    $
    435
    
    
    
    $
    437
    
    
    $
    443
    
    
    $
    412Other:Operating income (loss) per ton shipped
    
    $
    (11
    )
    
    $
    46
    
    
    $
    (36
    )
    
    
    $
    (55
    )
    
    $
    (21
    )
    
    $
    (81
    )
 Reorganized Company
    
    
    
    Predecessor Company(Dollars
in
thousands)As of
    
    
    
    As ofAs of December 31,
    
    
    July 31,
    
    
    
    December 31,2005
    
    
    2004
    
    
    2003
    
    
    2003
    
    
    
    2002
    
    
    2001Consolidated Balance SheetData (end of period)Cash, cash equivalents
and short-term investments
    
    $
    8,863
    
    
    $
    31,198
    
    
    $
    4,767
    
    
    $
    7,382
    
    
    
    $
    8,543
    
    
    $
    7,586Working capital (deficit)
    
    
    69,922
    
    
    
    153,190
    
    
    
    7,765
    
    
    
    47,100
    
    
    
    
    (255
    )
    
    
    (187
    )Property, plant and
    
    
    557,500
    
    
    
    487,308
    
    
    
    387,765
    
    
    
    360,213
    
    
    
    
    530,568
    
    
    
    593,888equipment, netTotal assets
    
    
    1,020,248
    
    
    
    955,486
    
    
    
    868,886
    
    
    
    878,769
    
    
    
    
    959,116
    
    
    
    990,865Total debt, including capitalized
leases and revolving credit facility
    
    
    332,757
    
    
    
    333,583
    
    
    
    422,645
    
    
    
    380,518
    
    
    
    
    56,752
    
    
    
    40,344Liabilities subject to compromise
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    890,301
    
    
    
    915,118Stockholders equity (deficit)
    
    
    265,504
    
    
    
    290,605
    
    
    
    104,613
    
    
    
    142,500
    
    
    
    
    (311,171
    )
    
    
    (253,604
    )
 28




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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
 ®
   Recent Developments
 Background
   29




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Industry and Production
      Potential Insurance Recovery
  Raw Materials, Coke Production and Coal Supply
  Joint Venture
  30




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Credit Arrangements and Covenant Compliance
   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 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
 31




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##### Table of Contents



secured notes issued by WPSC, $20 million
in new Series B secured notes issued by WPSC and 3,410,000 shares
of new common stock of the Company, constituting 34.1% of the
total shares of new common stock issued.
    
    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 for the most part by the Loan Board,
the West Virginia Housing Development Fund, the Company and WP
Steel Venture Corporation, a wholly-owned subsidiary of the
Company. WPSC also entered into a new $225 million senior secured
revolving credit facility, which is guaranteed by the Company and
WP Steel Venture Corporation.
 
    
    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 USW, with respect to the Companys
separation from WHX Corporations employee pension plan.
 
    
    The Company and WPSC entered into an agreement with its unionized
employees represented by the USW which modified the existing labor
agreement to provide for, among other things, future pension
arrangements with the USW and reductions in the Companys
employee-related costs.
 
    
    The Company issued 4,000,000 shares of new common stock,
constituting 40% of the total shares of new common stock issued,
for the benefit of USW retirees in satisfaction of certain claims
under its labor agreement and an additional 1,000,000 shares of
its new common stock, constituting 10% of the total shares of new
common stock issued, 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% of the total shares of new common stock issued,
to certain of its creditors in satisfaction of various unsecured
claims, including claims relating to trade debt.
  32




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CRITICAL ACCOUNTING POLICIES AND ESTIMATES
   Fresh Start Reporting
  Pension Benefits
    Other Postretirement Benefits (OPEB)
   33




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##### Table of Contents



Asset impairments
  Deferred taxes
  Environmental and legal contingencies
  RESULTS OF OPERATIONS
   Year ended December 31, 2005 versus year ended December 31, 2004  Reorganized Company
  34




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35




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##### Table of Contents



Five
months ended December 31, 2003  Reorganized Company
        Seven
months ended July 31, 2003  Predecessor Company
         LIQUIDITY AND CAPITAL RESOURCES
 Cash Flow from Operating Activities
  36




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##### Table of Contents



Cash Flow from Investing Activities
     Cash Flow from Financing Activities
     Liquidity and Capital Resources
   37




---



##### Table of Contents



$250 Million Term Loan Agreement
        38




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##### Table of Contents



$225 Million Revolving Credit Facility
    $40 Million Series A Notes
  $20 Million Series B Notes
  $10 Million Unsecured Note
  39




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##### Table of Contents



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
  OFF-BALANCE SHEET ARRANGEMENTS
  CERTAIN OTHER OBLIGATIONS
  
    
    Modification and assumption agreement between WPSC and 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 Loan Board. The balance of the
amount owed to Danieli Corporation was converted into a promissory note.
 
    
    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
 40




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$4.985 million of such loan at an interest rate
of 3% per annum, which was originally due in August 2005. In
August 2005, WPSC and the Ohio Department of Development agreed to
modify the repayment terms of the loan, providing for a $1.0
million payment in October 2005, a $1.5 million payment in July
2006, and a $2.485 million payment in December 2006.
 
    
    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 entered into a $6.5 million
loan agreement with the State of West Virginia. The loan has a
five-year term expiring on August 1, 2008 and bears interest at a
variable rate, which is reset annually and currently is
approximately 7.3% per annum.
 CONTRACTUAL COMMITMENTS
  Contractual Payments Due(Dollars in millions)2007 to
    
    
    2009 toTotal
    
    
    2006
    
    
    2008
    
    
    2010
    
    
    ThereafterLong-term debt (1)
    
    $
    308.4
    
    
    $
    30.4
    
    
    $
    205.2
    
    
    $
    23.9
    
    
    $
    48.9Capital leases (1)
    
    
    7.1
    
    
    
    1.0
    
    
    
    1.5
    
    
    
    1.5
    
    
    
    3.1Long-term operating leases (2)
    
    
    22.1
    
    
    
    3.4
    
    
    
    6.4
    
    
    
    5.0
    
    
    
    7.3Other long term liabilities:Steelworker Pension Trust
    
    
    28.7
    (3)
    
    
    11.1
    
    
    
    17.6
    
    
    
    
    
    
    
    OPEB
    
    
    28.1
    (4)
    
    
    4.5
    
    
    
    10.4
    
    
    
    13.2
    
    
    
    Coal miner retiree medical
    
    
    3.8
    
    
    
    0.2
    
    
    
    0.3
    
    
    
    0.3
    
    
    
    3.0Workers compensation
    
    
    31.3
    (5)
    
    
    6.3
    
    
    
    12.5
    
    
    
    12.5
    
    
    
    Special bonus payment
    
    
    5.0
    (6)
    
    
    5.0
    
    
    
    
    
    
    
    
    
    
    
    Purchase commitments:Oxygen supply
    
    
    99.5
    (7)
    
    
    8.2
    
    
    
    18.4
    
    
    
    21.6
    
    
    
    51.3Electricity
    
    
    88.9
    (8)
    
    
    6.8
    
    
    
    15.0
    
    
    
    14.0
    
    
    
    53.1Coal
    
    
    17.3
    (9)
    
    
    8.3
    
    
    
    9.0
    
    
    
    
    
    
    
    Coal
    
    
    18.9
    (10)
    
    
    9.4
    
    
    
    9.5
    
    
    
    
    
    
    
    Capital commitments
    
    
    49.8
    (11)
    
    
    49.8
    
    
    
    
    
    
    
    
    
    
    
    Total
    
    $
    708.8
    
    
    $
    144.4
    
    
    $
    305.7
    
    
    $
    92.0
    
    
    $
    166.7
 
 1.
    
    See Note 17 to Consolidated Financial Statement in Item 8  Financial Statements and
Supplementary Data.2.
    
    See Note 18 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 USW, 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 2010.5.
    
    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 2005 and anticipates payment of approximately
$6.25 million per year. No estimate has been made beyond 2010.6.
    
    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.7.
    
    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 $0.7 million, subject to escalation clauses.8.
    
    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 $0.5 million, subject to increases for inflation, and a variable
charge calculated at a minimum of $3.75 times the number of tons of iron produced each month 41




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##### Table of Contents



with an agreed-to minimum of 3,000 tons per day, regardless of whether any tons are produced.
At December 31, 2005, a maximum termination payment of $30.7 million would have been required
to terminate the contract. 9.
    
    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, 2007.10.
    
    In 2005, we entered into contracts to purchase 20,000 tons of coal each month from August
2006 through May 2007 at a price approximating $94.50 per ton.11.
    
    Amounts reflect contractual commitments for capital expenditure as of December 31, 2005.
 Planned Capital Expenditures
  
    
    $77.2 million toward completion of the refurbishment of the coke plant facility contributed to our new joint venture
($60 million of which will be contributed to the joint venture by our joint venture partner);
 
    
    $5.7 million for cold mill improvements at our Allenport facility; and
 
    
    $1.5 million for completion of the installation of hot strip mill automatic roll changers at our Mingo Junction
facility.
  VEBA TRUST AND PROFIT SHARING PLANS
   VEBA Trust
  (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
 42




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##### Table of Contents



(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.
       Profit Sharing Plans
  43




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RECENT ACCOUNTING STANDARDS
    
 Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
  44




---



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Commodity Price Risk and Related Risks
   Interest Rate Risk
   Credit Risk
  Foreign Currency Exchange Risk
  
 Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
  45




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Managements Report on Internal Control Over Financial Reporting.
   Internal Control  Integrated Framework
  46




---



##### Table of Contents



Report of Independent Registered Public Accounting Firm
 
  Consolidated financial statements
   Internal control over financial reporting
 Internal Control  Integrated Framework Internal Control  Integrated Framework
 47




---



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48




---



##### Table of Contents



Report of Independent Registered Public Accounting Firm
 
   
 49




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WHEELING-PITTSBURGH CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations
(Dollars in thousands, except per share amounts)
 Reorganized
    
    
    
    PredecessorCompany
    
    
    
    CompanyFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003RevenuesNet sales, including sales to affiliates of
$343,546, $367,735, $101,501
and $164,273
    
    $
    1,560,513
    
    
    $
    1,405,794
    
    
    $
    396,902
    
    
    
    $
    570,439Cost and expensesCost of sales, including cost of sales to
affiliates of $346,057, $324,813,
$91,262 and $143,840, excluding depreciation
and amortization expense
    
    
    1,479,474
    
    
    
    1,206,773
    
    
    
    395,950
    
    
    
    
    563,832Depreciation and amortization expense
    
    
    33,984
    
    
    
    33,433
    
    
    
    10,473
    
    
    
    
    39,889Selling, general and administrative expense
    
    
    71,552
    
    
    
    67,620
    
    
    
    23,671
    
    
    
    
    29,906Reorganization and professional fee expense
    
    
    
    
    
    
    
    
    
    
    (35
    )
    
    
    
    8,140Total costs and expenses
    
    
    1,585,010
    
    
    
    1,307,826
    
    
    
    430,059
    
    
    
    
    641,767Operating income (loss)
    
    
    (24,497
    )
    
    
    97,968
    
    
    
    (33,157
    )
    
    
    
    (71,328
    )Interest expense and other financing costs
    
    
    (21,834
    )
    
    
    (19,778
    )
    
    
    (10,215
    )
    
    
    
    (9,185
    )Other income
    
    
    11,843
    
    
    
    17,520
    
    
    
    4,350
    
    
    
    
    3,228Reorganization income (expense):Fair value adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (152,708
    )Gain on discharge of indebtedness
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    557,541Other
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,758
    )Income (loss) before income taxes
    
    
    (34,488
    )
    
    
    95,710
    
    
    
    (39,022
    )
    
    
    
    322,790Income tax provision (benefit)
    
    
    (71
    )
    
    
    33,479
    
    
    
    15
    
    
    
    
    (641
    )Income (loss) before minority interest
    
    
    (34,417
    )
    
    
    62,231
    
    
    
    (39,037
    )
    
    
    
    323,431Minority interest in loss of consolidated subsidiary
    
    
    583
    
    
    
    
    
    
    
    
    
    
    
    
    Net income (loss)
    
    $
    (33,834
    )
    
    $
    62,231
    
    
    $
    (39,037
    )
    
    
    $
    323,431Earnings (loss) per share:Basic
    
    $
    (2.37
    )
    
    $
    5.78
    
    
    $
    (4.11
    )
    
    
    
    *Diluted
    
    $
    (2.37
    )
    
    $
    5.66
    
    
    $
    (4.11
    )
    
    
    
    *Weighted average shares (in thousands):Basic
    
    
    14,302
    
    
    
    10,759
    
    
    
    9,500
    
    
    
    
    *Diluted
    
    
    14,302
    
    
    
    11,002
    
    
    
    9,500
    
    
    
    
    *
 
 *
    
    Prior to reorganization, the Company was a wholly-owned subsidiary of WHX Corporation (see Note 2)  50




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WHEELING-PITTSBURGH CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets
(Dollars in thousands)
 December 31,2005
    
    
    2004AssetsCurrent assets:Cash and cash equivalents
    
    $
    8,863
    
    
    $
    31,198Accounts receivables, less allowance for doubtful accounts
of $2,594 and $2,697
    
    
    132,643
    
    
    
    144,509Inventories
    
    
    166,566
    
    
    
    156,669Prepaid expenses and deferred charges
    
    
    21,732
    
    
    
    29,953Total current assets
    
    
    329,804
    
    
    
    362,329Investment in and advances to affiliated companies
    
    
    55,100
    
    
    
    53,016Property, plant and equipment, less accumulated depreciation
of $75,977 and $42,536
    
    
    557,500
    
    
    
    487,308Deferred income tax benefits
    
    
    26,264
    
    
    
    18,751Restricted cash
    
    
    13,691
    
    
    
    12,502Intangible assets, less accumulated amortization of $1,795 and $1,346
    
    
    4,725
    
    
    
    5,174Deferred charges and other assets
    
    
    33,164
    
    
    
    16,406Total assets
    
    $
    1,020,248
    
    
    $
    955,486LiabilitiesCurrent liabilities:Accounts payable, including book overdrafts of $21,020 and $8,894
    
    $
    117,821
    
    
    $
    92,434Short-term debt
    
    
    17,300
    
    
    
    Payroll and employee benefits payable
    
    
    41,125
    
    
    
    48,611Accrued income and other taxes
    
    
    11,735
    
    
    
    10,073Deferred income taxes payable
    
    
    26,264
    
    
    
    18,751Accrued interest and other liabilities
    
    
    5,757
    
    
    
    7,843Deferred revenue
    
    
    8,523
    
    
    
    Long-term debt due in one year
    
    
    31,357
    
    
    
    31,427Total current liabilities
    
    
    259,882
    
    
    
    209,139Long-term debt
    
    
    284,100
    
    
    
    302,156Employee benefits
    
    
    123,498
    
    
    
    135,608Other liabilities
    
    
    13,030
    
    
    
    17,978Total liabilities
    
    
    680,510
    
    
    
    664,881Minority interest in consolidated subsidiary
    
    
    74,234
    
    
    
    Stockholders equityPreferred stock  $.001 par value; 20,000,000 shares authorized; no shares
issued or outstanding
    
    
    
    
    
    
    Common stock  $.01 par value; 80,000,000 shares authorized; 14,686,354 and
14,437,223 shares issued; 14,679,688 and 14,433,223 shares outstanding
    
    
    147
    
    
    
    144Additional paid-in capital
    
    
    276,097
    
    
    
    267,327Accumulated (deficit) earnings
    
    
    (10,640
    )
    
    
    23,194Treasury stock, 6,666 and 4,000 shares, at cost
    
    
    (100
    )
    
    
    (60
    )Total stockholders equity
    
    
    265,504
    
    
    
    290,605Total liabilities and stockholders equity
    
    $
    1,020,248
    
    
    $
    955,486
  51




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WHEELING-PITTSBURGH CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Dollars in thousands)
 Reorganized
    
    
    
    PredecessorCompany
    
    
    
    CompanyFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003Cash flows from operating activitiesNet income (loss)
    
    $
    (33,834
    )
    
    $
    62,231
    
    
    $
    (39,037
    )
    
    
    $
    323,431Adjustments to reconcile net income (loss) to cash
provided by (used in) operating activities:Depreciation and amortization expense
    
    
    33,984
    
    
    
    33,433
    
    
    
    10,473
    
    
    
    
    39,889VEBA, profit sharing and other stock transactions
    
    
    3,961
    
    
    
    22,981
    
    
    
    
    
    
    
    
    Other postretirement benefits
    
    
    (786
    )
    
    
    3,359
    
    
    
    (4,608
    )
    
    
    
    (1,565
    )Deferred compensation and stock options
    
    
    3,018
    
    
    
    2,837
    
    
    
    1,148
    
    
    
    
    Interest paid-in-kind
    
    
    1,803
    
    
    
    2,384
    
    
    
    
    
    
    
    
    Equity income of affiliated companies, net
of dividends
    
    
    (4,109
    )
    
    
    (11,884
    )
    
    
    (1,708
    )
    
    
    
    184Loss on disposition of assets
    
    
    450
    
    
    
    361
    
    
    
    Deferred income taxes
    
    
    
    
    
    
    32,505
    
    
    
    
    
    
    
    
    Minority interest
    
    
    (583
    )
    
    
    
    
    
    
    
    
    
    
    
    Reorganization income and other
    
    
    48
    
    
    
    
    
    
    
    
    
    
    
    
    (400,075
    )Changes in current assets and current liabilities:Accounts receivable
    
    
    11,866
    
    
    
    (40,484
    )
    
    
    8,391
    
    
    
    
    17,944Inventories
    
    
    (9,897
    )
    
    
    (9,774
    )
    
    
    7,769
    
    
    
    
    19,769Other current assets
    
    
    8,221
    
    
    
    (18,370
    )
    
    
    (5,012
    )
    
    
    
    918Accounts payable
    
    
    13,261
    
    
    
    14,118
    
    
    
    (6,990
    )
    
    
    
    9,900Other current liabilities
    
    
    2,367
    
    
    
    (13,505
    )
    
    
    (11,874
    )
    
    
    
    (306
    )Other assets and other liabilities, net
    
    
    (18,213
    )
    
    
    (8,167
    )
    
    
    6,190
    
    
    
    
    (9,902
    )Net cash provided by (used in) operating activities
    
    
    11,557
    
    
    
    72,025
    
    
    
    (35,258
    )
    
    
    
    187Cash flows from investing activitiesPayments from affiliates
    
    
    2,025
    
    
    
    1,725
    
    
    
    325
    
    
    
    
    600Capital expenditures
    
    
    (103,710
    )
    
    
    (132,442
    )
    
    
    (37,828
    )
    
    
    
    (2,866
    )Restricted cash used to fund capital expenditures
    
    
    (1,189
    )
    
    
    74,636
    
    
    
    24,862
    
    
    
    
    Proceeds from sale of assets
    
    
    625
    
    
    
    28
    
    
    
    
    
    
    
    
    201Net cash used in investing activities
    
    
    (102,249
    )
    
    
    (56,053
    )
    
    
    (12,641
    )
    
    
    
    (2,065
    )Cash flows from financing activitiesBook overdraft
    
    
    12,126
    
    
    
    2,208
    
    
    
    3,157
    
    
    
    
    327Net change in short-term debt
    
    
    17,300
    
    
    
    (79,251
    )
    
    
    42,336
    
    
    
    
    Short term debt (DIP facility) borrowings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,724Borrowing of long-term debt
    
    
    
    
    
    
    3,000
    
    
    
    (209
    )
    
    
    
    (1,334
    )Repayment of long-term debt
    
    
    (21,069
    )
    
    
    (15,195
    )
    
    
    
    
    
    
    
    Minority interest investment in subsidiary
    
    
    60,000
    
    
    
    
    
    
    
    
    
    
    
    
    Issuance of common stock, net of issuance costs
    
    
    
    
    
    
    99,697
    
    
    
    
    
    
    
    
    Net cash provided by financing activities
    
    
    68,357
    
    
    
    10,459
    
    
    
    45,284
    
    
    
    
    717Increase (decrease) in cash and cash equivalents
    
    
    (22,335
    )
    
    
    26,431
    
    
    
    (2,615
    )
    
    
    
    (1,161
    )Cash and cash equivalents, beginning of period
    
    
    31,198
    
    
    
    4,767
    
    
    
    7,382
    
    
    
    
    8,543Cash and cash equivalents, end of period
    
    $
    8,863
    
    
    $
    31,198
    
    
    $
    4,767
    
    
    
    $
    7,382
  52




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##### Table of Contents



WHEELING-PITTSBURGH CORPORATION AND SUBSIDIARIES
Consolidated Statement of Changes in Stockholders Equity
(Dollars in thousands)
 Additional
    
    
    AccumulatedPreferred
    
    
    Common
    
    
    Paid-in
    
    
    Earnings
    
    
    TreasuryStock
    
    
    Stock
    
    
    Capital
    
    
    (Deficit)
    
    
    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
    
    
    
    (5
    )
    
    
    
    
    
    
    
    
    
    
    Compensation expense recognized
    
    
    
    
    
    
    
    
    
    
    1,042
    
    
    
    
    
    
    
    
    
    
    
    1,042Stock option grants
    
    
    
    
    
    
    
    
    
    
    108
    
    
    
    
    
    
    
    
    
    
    
    108Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (39,037
    )
    
    
    
    
    
    
    (39,037
    )Balance, December 31, 2003
    
    
    
    
    
    
    100
    
    
    
    143,550
    
    
    
    (39,037
    )
    
    
    
    
    
    
    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
    
    
    
    
    
    
    
    
    
    
    366
    
    
    
    
    
    
    
    
    
    
    
    366Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    62,231
    
    
    
    
    
    
    
    62,231Balance, December 31, 2004
    
    
    
    
    
    
    144
    
    
    
    267,327
    
    
    
    23,194
    
    
    
    (60
    )
    
    
    290,605Shares issued:Employee benefit plans
    
    
    
    
    
    
    3
    
    
    
    5,712
    
    
    
    
    
    
    
    
    
    
    
    5,715Restricted stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Restricted stock forfeiture
    
    
    
    
    
    
    
    
    
    
    40
    
    
    
    
    
    
    
    (40
    )
    
    
    Compensation expense recognized
    
    
    
    
    
    
    
    
    
    
    2,687
    
    
    
    
    
    
    
    
    
    
    
    2,687Stock option grants
    
    
    
    
    
    
    
    
    
    
    331
    
    
    
    
    
    
    
    
    
    
    
    331Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (33,834
    )
    
    
    
    
    
    
    (33,834
    )Balance, December 31, 2005
    
    $
    
    
    
    $
    147
    
    
    $
    276,097
    
    
    $
    (10,640
    )
    
    $
    (100
    )
    
    $
    265,504
  53




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##### Table of Contents



Notes to Consolidated Financial Statements  (Dollars in thousands, except per share and per ton amounts)
 1.
    
    Summary of Significant Accounting Policies
 Nature of Business
  Basis of Presentation
  Principles of Consolidation
   Cash and Cash Equivalents
  Accounts Receivable
  Inventory
  Property, Plant and Equipment
  54




---



##### Table of Contents



Software Costs
  Income Taxes
  Goodwill
  Intangible Assets
  Deferred Financing Costs
  55




---



##### Table of Contents



Pension and Other Postretirement Benefits
  Asset Retirement Obligations
  Revenue Recognition
  Environmental Expenditures
  Stock-based Payments
  Earnings (loss) per Share
  Use of Estimates
  56




---



##### Table of Contents



Concentrations of Credit and Business Risk
   New Accounting Standards
    2.
    
    Bankruptcy and 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 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.
 57




---



##### Table of Contents




    
    The Company exchanged, on a pro rata basis, $275,000 in senior notes and $75,000 in term
notes that existed prior to its bankruptcy filing for an aggregate of $20,000 in cash,
$40,000 in new Series A secured notes issued by Wheeling-Pittsburgh Steel Corporation
(WPSC), a wholly-owned subsidiary of the Company, $20,000 in new Series B secured notes
issued by WPSC and 3,410,000 shares of new common stock of the Company, constituting 34.1%
of the total shares of new common stock issued.
    
    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 $250,000 senior secured term loan facility, which is guaranteed
for the most part by the Emergency Steel Loan Guarantee Board, the West Virginia Housing
Development Fund, the Company and WP Steel Venture Corporation, a wholly-owned subsidiary
of the Company. WPSC also entered into a new $225,000 senior secured revolving credit
facility, which is guaranteed by the Company and WP Steel Venture Corporation.
    
    All of the obligations under the Companys $195,000 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 $10,000 capital contribution by WHX Corporation, the capitalization of
approximately $40,000 in debt owed by the Company to WHX Corporation, a $10,000 unsecured
loan from WHX Corporation and an agreement with WHX Corporation, the Pension Benefit
Guaranty Corporation (PBGC), and the United Steelworkers of America (USW), with respect to
the Companys separation from WHX Corporations employee pension plan.
    
    The Company and WPSC entered into an agreement with its unionized employees represented
by the USW which modified the existing labor agreement to provide for, among other things,
future pension arrangements with the USW and reductions in the Companys employee-related
costs.
    
    The Company issued 4,000,000 shares of new common stock, constituting 40% of the total
shares of new common stock issued, for the benefit of USW retirees in satisfaction of
certain claims under its labor agreement and an additional 1,000,000 shares of its new
common stock, constituting 10% of the total shares of new common stock issued, 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% of the total
shares of new common stock issued, to certain of its creditors in satisfaction of various
unsecured claims, including claims relating to trade debt.
  58




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##### Table of Contents



3.
    
    Fresh Start Reporting
     Pre-
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Post-Reorganization
    
    
    Reorganization
    
    
    
    
    
    
    Fresh Start
    
    
    ReorganizationJuly 31, 2003
    
    
    Adjustments
    
    
    
    
    
    
    Adjustments
    
    
    July 31, 2003AssetsCurrent assets:Cash and cash equivalents
    
    $
    7,382
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    7,382Accounts receivable,less allowance
for doubtful accounts of $1,916
    
    
    112,649
    
    
    
    (233
    )
    
    
    
    
    
    
    
    
    
    
    112,416Inventories
    
    
    164,322
    
    
    
    
    
    
    
    
    
    
    
    (9,658
    )
    
    
    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
    )
    
    
    40,477Property, plant and equipment, less
accumulated depreciation
    
    
    493,514
    
    
    
    
    
    
    
    
    
    
    
    (133,301
    )
    
    
    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
    
    
    
    31,564Total assets
    
    $
    880,714
    
    
    $
    150,763
    
    
    
    
    
    
    $
    (152,708
    )
    
    $
    878,769
 59




---



##### Table of Contents



Pre-
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Post-Reorganization
    
    
    Reorganization
    
    
    
    
    
    
    Fresh Start
    
    
    
    
    
    
    ReorganizationJuly 31, 2003
    
    
    Adjustments
    
    
    
    
    
    
    Adjustments
    
    
    
    
    
    
    July 31, 2003LiabilitiesCurrent liabilities:Accounts payable
    
    $
    81,275
    
    
    $
    (1,334
    )
    
    
    [a]
    
    
    $
    
    
    
    
    
    
    
    $
    79,941Short-term debt
    
    
    137,214
    
    
    
    (100,299
    )
    
    
    [a]
    
    
    
    
    
    
    
    
    
    
    
    36,915Payroll and employee benefits
    
    
    35,118
    
    
    
    32,795
    
    
    
    [c]
    
    
    
    
    
    
    
    
    
    
    
    67,913Accrued income and other taxes
    
    
    10,054
    
    
    
    1,200
    
    
    
    [a],[c]
    
    
    
    
    
    
    
    
    
    
    
    11,254Deferred income taxes
    
    
    27,342
    
    
    
    (3,860
    )
    
    
    [a],[c]
    
    
    
    
    
    
    
    
    
    
    
    23,482Accrued interest and other
    
    
    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 benefits
    
    
    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 $250,000 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.
    
    Change in Accounting Method
  60




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##### Table of Contents



Reorganized
    
    
    PredecessorCompany
    
    
    CompanyFive Months
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    2003Income (loss) from continuing
operations, before adjustment
    
    $
    (33,503
    )
    
    $
    62,467
    
    
    $
    (38,930
    )
    
    $
    323,431Effect of adopting fair-value method of
accounting for share-based payments
    
    
    (331
    )
    
    
    (363
    )
    
    
    (107
    )
    
    
    Income (loss) from continuing
operations, as adjusted
    
    
    (33,834
    )
    
    
    62,104
    
    
    
    (39,037
    )
    
    
    323,431Effect of adoption on benefit for
income taxes
    
    
    
    
    
    
    127
    
    
    
    
    
    
    
    Net income (loss), as adjusted
    
    $
    (33,834
    )
    
    $
    62,231
    
    
    $
    (39,037
    )
    
    $
    323,431Earnings (loss) per share:Basic, before adjustment
    
    $
    (2.34
    )
    
    $
    5.81
    
    
    $
    (4.10
    )
    
    
    
    *Effect of adoption
    
    $
    (0.03
    )
    
    $
    (0.03
    )
    
    $
    (0.01
    )
    
    
    
    *Basic, as adjusted
    
    $
    (2.37
    )
    
    $
    5.78
    
    
    $
    (4.11
    )
    
    
    
    *Diluted, before adjustment
    
    $
    (2.34
    )
    
    $
    5.68
    
    
    $
    (4.10
    )
    
    
    
    *Effect of adoption
    
    $
    (0.03
    )
    
    $
    (0.02
    )
    
    $
    (0.01
    )
    
    
    
    *Diluted, as adjusted
    
    $
    (2.37
    )
    
    $
    5.66
    
    
    $
    (4.11
    )
    
    
    
    *
 *
    
    Prior to reorganization, the Company was a wholly-owned subsidiary of WHX Corporation (see
Note 2)  5.
    
    Segments, Geographic Area and Major Customers
   6.
    
    Transactions with Affiliates and Related Parties
  61




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##### Table of Contents



7.
    
    Insurance Recovery
  8.
    
    Share-Based Payments
  WeightedAverageGrant DateShares
    
    
    Fair ValueBalance, December 31, 2004
    
    
    330,667
    
    
    $
    15.00Restricted stock granted
    
    
    10,500
    
    
    $
    39.01Restricted stock forfeited
    
    
    (2,666
    )
    
    $
    15.00Restricted stock vested
    
    
    (164,001
    )
    
    $
    15.00Balance, December 31, 2005
    
    
    174,500
    
    
    $
    16.44
  62




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##### Table of Contents



Weighted-Average
    
    
    AggregateExercise
    
    
    IntrinsicShares
    
    
    Price
    
    
    ValueOutstanding, December 31, 2004
    
    
    37,008
    
    
    $
    14.76
    
    
    $
    37Granted
    
    
    25,389
    
    
    
    16.65
    
    
    
    Exercised
    
    
    
    
    
    
    
    
    
    
    Expired
    
    
    
    
    
    
    
    
    
    
    Outstanding, December 31, 2005
    
    
    62,397
    
    
    $
    15.53
    
    
    $
    37Exercisable, December 31, 2005
    
    
    62,397
    
    
    $
    15.53
    
    
    $
    37
  Reorganized
    

    
    
    
    
    PredecessorCompany
    
    
    
    CompanyFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003Average risk-free interest rate
    
    
    4.38
    %
    
    
    3.41
    %
    
    
    4.22
    %
    
    
    
    Expected dividend yield
    
    
    0
    %
    
    
    0
    %
    
    
    0
    %
    
    
    
    Expected volatility
    
    
    83.32
    %
    
    
    88.27
    %
    
    
    85.07
    %
    
    
    
    Expected life (years)
    
    
    10
    
    
    
    10
    
    
    
    10
    
    
    
    
    
   63




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##### Table of Contents



9. Interest Expense and Other Financing Costs
 Reorganized
            
    
    
    
    PredecessorCompany
    
    
    

CompanyFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003Interest incurred
    
    $
    19,729
    
    
    $
    18,933
    
    
    $
    8,744
    
    
    
    $
    7,660Less interest capitalized
    
    
    (2,946
    )
    
    
    (4,050
    )
    
    
    (243
    )
    
    
    
    (838
    )Net interest
    
    
    16,783
    
    
    
    14,883
    
    
    
    8,501
    
    
    
    
    6,822Amortization of deferred
financing costs
    
    
    5,051
    
    
    
    4,895
    
    
    
    1,714
    
    
    
    
    2,363Interest expense and other
financing costs
    
    $
    21,834
    
    
    $
    19,778
    
    
    $
    10,215
    
    
    
    $
    9,185
 10. Other Income
 Reorganized
                      
    
    
    
    PredecessorCompany
    
    
    
    CompanyFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003Equity income in affiliates
    
    $
    9,403
    
    
    $
    14,677
    
    
    $
    2,705
    
    
    
    $
    2,544Interest and investment income
    
    
    914
    
    
    
    1,226
    
    
    
    638
    
    
    
    
    360Other
    
    
    1,526
    
    
    
    1,617
    
    
    
    1,007
    
    
    
    
    324Total
    
    $
    11,843
    
    
    $
    17,520
    
    
    $
    4,350
    
    
    
    $
    3,228
 11.
    
    Earnings (Loss) Per ShareFor the years ended December 31, 2005 and 2004 and for the five months ended December 31, 2003,
a reconciliation of the numerator and denominator for the calculation of basic and diluted
earnings (loss) per share is as follows:
 64




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##### Table of Contents



Reorganized
    
    
    
    
    
    PredecessorCompany
    
    
    
    CompanyFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003Income
(loss) available to common shareholders
    
    $
    (33,834
    )
    
    $
    62,231
    
    
    $
    (39,037
    )
    
    
    $
    323,431Weighed-average basic shares
outstanding
    
    
    14,302
    
    
    
    10,759
    
    
    
    9,500
    
    
    
    
    *Dilutive effect of:Stock options
    
    
    
    
    
    
    15
    
    
    
    
    
    
    
    
    *Non-vested restricted common stock
    
    
    
    
    
    
    228
    
    
    
    
    
    
    
    
    *Weighed-average diluted shares
outstanding
    
    
    14,302
    
    
    
    11,002
    
    
    
    9,500
    
    
    
    
    *Basic earnings (loss) per share
    
    $
    (2.37
    )
    
    $
    5.78
    
    
    $
    (4.11
    )
    
    
    
    *Diluted earnings (loss) per share
    
    $
    (2.37
    )
    
    $
    5.66
    
    
    $
    (4.11
    )
    
    
    
    *
 *
    
    Prior to reorganization, the Company was a wholly-owned subsidiary of WHX Corporation (see Note 2)
  12. Inventories
 December 31,2005
    
    
    2004Raw materials
    
    $
    49,193
    
    
    $
    46,070In-process
    
    
    155,860
    
    
    
    128,114Finished products
    
    
    28,870
    
    
    
    23,662Other materials and supplies
    
    
    152
    
    
    
    307Total current cost
    
    
    234,075
    
    
    
    198,153Excess of current cost over carrying value
    
    
    (67,509
    )
    
    
    (41,484
    )Total carrying value
    
    $
    166,566
    
    
    $
    156,669
  65




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##### Table of Contents



13.
    
    Investment in and Advances to AffiliatesThe Company owns 35.7% of the outstanding common stock of Wheeling-Nisshin, 50% of the
outstanding common stock of OCC and 49% of the outstanding common stock of Feralloy-Wheeling
Specialty Processing, Co., all of which are accounted for using the equity method of accounting.
The carrying value of the Companys investment in affiliates was $47,400 and $43,291at December
31, 2005 and 2004, respectively.As a result of the application of fresh start reporting, the Company restated its investment in
affiliates to fair value as July 31, 2003. At December 31, 2005, the Companys interest in the
net assets of its affiliates accounted for using the equity method of accounting amounted to
$62,862, which exceeded the carrying value of the Companys investment in affiliates by $15,462.
This amount is being amortized to income over a 10-year period, which represents the estimated
remaining useful life of the long-lived assets of the affiliates as
of July 31, 2003.The Company has a loan receivable due from OCC, which bears interest at a variable rate, which
averaged 6.25% during 2005. The loan receivable due from OCC was $7,700 and $9,725 at December
31, 2005 and 2004, respectively.
 14. Property, Plant and Equipment
 December 31,2005
    
    
    2004Land and mineral properties
    
    $
    8,608
    
    
    $
    8,640Buildings
    
    
    21,717
    
    
    
    21,627Machinery and equipment
    
    
    458,158
    
    
    
    438,201Construction in progress
    
    
    144,994
    
    
    
    61,376Total
    
    
    633,477
    
    
    
    529,844Less accumulated depreciation and amortization
    
    
    (75,977
    )
    
    
    (42,536
    )Net
    
    $
    557,500
    
    
    $
    487,308
  
 15.
    
    Intangible Assets and GoodwillIntangible assets represents the estimated fair value of steel supply contracts with
Wheeling-Nisshin and OCC, which were recorded as a result of the application of fresh start
reporting as of July 31, 2003. These intangible assets are being amortized over the term of the
steel supply contracts, one of which expires in 2012 and the other in 2013, using the
straight-line method. No residual value has been assigned to these contracts. The Company
recorded amortization expense of $449, $923 and $423 in 2005, 2004 and for the five months ended
December 31, 2003, respectively. Amortization expense of approximately $624 will be recorded in
each of the next five years unless the intangible asset is reduced as the result of the
recognition of pre-confirmation tax benefits realized before that time. Changes in the
intangible asset as a result of pre-confirmation tax benefits affect amortization expense on a
prospective basis.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 $30,000 and other intangible assets were reduced by $2,979, representing
the tax
 66




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##### Table of Contents



16.
    
    Short-Term DebtOn July 8, 2005, the Company entered into an amended and restated $225,000 revolving credit
agreement, which matures on July 8, 2009. The new credit agreement amended and restated the
Companys $225,000 revolving credit agreement entered into in August 2003, which was scheduled
to mature on August 1, 2006. At December 31, 2005, $17,300 was outstanding under the agreement.
No amounts were outstanding under the agreement at December 31, 2004.The amended and restated revolving credit agreement requires the Company to maintain minimum
borrowing availability of $50,000 at all times or to comply with a minimum fixed charge coverage
ratio if borrowing availability under the agreement falls below $50,000 at any point in time.
The Company is restricted from paying any cash dividends under the terms of the agreement.Borrowing availability under the agreement is based on eligible accounts receivable and
inventory amounts, as defined by the agreement. Borrowing availability is reduced by amounts
outstanding under the agreement and by outstanding letters of credit. At December 31, 2005, net
borrowing availability under the agreement amounted to $141,263, net of the $50 million minimum
borrowing availability requirement. Interest on borrowings under the agreement is payable
monthly and is calculated based on LIBOR or the prime rate using spreads based on borrowing
availability, as defined by the agreement. The average rate of interest on amounts outstanding
under the agreement during 2005, 2004 and the five months ended December 31, 2003 approximated
6.3%, 4.9% and 5.0%, respectively. Amounts outstanding under the agreement are collateralized
by a first lien on accounts receivable and inventory and a third lien on other tangible and
intangible assets and investments in affiliates.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 95-22.17.
    
    Long-Term Debt
 December 31,2005
    
    
    2004Senior secured term loan
    
    $
    218,650
    
    
    $
    237,500Series A secured notes
    
    
    41,681
    
    
    
    41,681Series B secured notes
    
    
    22,661
    
    
    
    21,499Unsecured 6% note
    
    
    11,171
    
    
    
    10,530West Virginia Department of Development
    
    
    6,539
    
    
    
    6,539Ohio Department of Development
    
    
    3,985
    
    
    
    4,985Industrial revenue bonds (capital leases)
    
    
    6,190
    
    
    
    6,910Other, including a capital lease
    
    
    4,580
    
    
    
    3,939Total
    
    
    315,457
    
    
    
    333,583Less amount due in one year
    
    
    31,357
    
    
    
    31,427Long-term debt due after one year
    
    $
    284,100
    
    
    $
    302,156
 67




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##### Table of Contents



2006
    
    $
    31,3572007
    
    
    30,1192008
    
    
    176,5772009
    
    
    1,5012010
    
    
    23,906After 2010
    
    
    51,997Total
    
    $
    315,457
 $250,000
term loan agreement
     $40,000
Series A secured notes
   68




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##### Table of Contents



$20,000
Series B secured notes
   $10,000
unsecured note
   West
Virginia and Ohio Departments of Development
   Industrial
revenue bonds  capital leases
   Other,
including a capital lease
  18.
    
    LeasesThe Company leases certain equipment under operating lease agreements. Lease expense for 2005,
2004, the five months ended December 31, 2003 and the seven months ended July 31, 2003 amounted
to $10,271, $10,596, $3,921 and $5,772, respectively. Under long-term operating leases, minimum
lease payments are
$3,389 for 2006, $3,389 for 2007, $2,971 for 2008, $2,718 for 2009, $2,348 for 2010 and
$7,290 thereafter.
 69




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##### Table of Contents



19.
    
    Variable Interest EntityOn September 29, 2005, the Company and SNA Carbon, LLC (SNA Carbon) entered into an Amended and
Restated Limited Liability Company Agreement of Mountain State Carbon, LLC, a limited liability
company (a joint venture) formed to own and refurbish the coke plant facility contributed to it
by the Company and to produce and sell metallurgical coke to and for the benefit of both
parties. Upon formation of the joint venture, each party received a 50% voting interest in the
joint venture.In general, all coke produced by the joint venture will be sold to each party at the cost
incurred by the joint venture to produce coke, plus 5%. Pursuant to coke supply agreements
between the parties and the joint venture, the Company will acquire approximately 60% of all of
the coke produced by the joint venture from inception through December 31, 2006. Each party
will acquire 50% of all coke produced by the joint venture for all periods thereafter. Due to
the disproportionate sale of coke by the joint venture from inception through December 31, 2006,
the Company has been identified as the primary beneficiary of the joint venture in accordance
with the provisions of FASB Interpretation No. 46 (revised December 2003), Consolidation of
Variable Interest Entities, an Interpretation of ARB No. 51.At December 31, 2005, the net assets of the joint venture included in the consolidated balance
sheet of the Company were as follows:
 Cash and cash equivalents
    
    $
    3,629Accounts receivable
    
    
    962Inventory
    
    
    10,120Other current assets
    
    
    2,282Total current assets
    
    
    16,993Restricted cash
    
    
    13,691Property, plant and equipment, net
    
    
    99,595Other assets
    
    
    15,617Total
    
    
    145,896Accounts payable
    
    
    21,986Other current liabilities
    
    
    119Other liabilities
    
    
    86Minority interest
    
    
    74,234Total
    
    
    96,425Net assets
    
    $
    49,471
  Net sales
    
    $
    1,032Cost of goods sold
    
    
    (471
    )Depreciation and amortization expense
    
    
    (588
    )Selling, general and administrative expense
    
    
    (839
    )Operating loss
    
    
    (866
    )Interest income, net
    
    
    224Loss before minority interest
    
    $
    (642
    )
  70




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##### Table of Contents



20.
    
    Pension and Other Postretirement and Postemployment BenefitsAll 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. 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
Steelworkers 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 2005, 2004 and the five months ended December 31, 2003, the Company accrued $10,037,
$3,883 and $2,316, respectively, under the plan. During 2005 and 2004, the Company contributed
$9,700 and $13,991 to the SPT, respectively, with $8,400 of the amount contributed during 2004
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.Upon emergence from bankruptcy and pursuant to the collective bargaining agreement with the USW,
the Company agreed to provide enhanced benefits to up to 650 union employees who were retirement
eligible, and who elected to retire under a job buyout program offered by the Company. Under
terms of the plan, individuals electing to retire under the job buyout program were entitled to
receive a benefit of $40 payable in equal installments until the individual reached the age of
62 or for a period of two years, whichever was longer. Benefits under the job buyout program
have been paid by the Company through its defined benefit pension plan since inception of the
program. As a result, it has been determined that obligations under this plan should be
included in and disclosed as a part of the defined benefit pension plan as of December 31,
2005. Previously, the Company reported all obligations owing under this plan in the balance
sheet as employee benefits payable as of December 31, 2004 and 2003.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 21). 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.The Companys health care and life insurance benefit plans for retired employees provides
prescription drug benefits. At December 31, 2004, a determination as to whether the Companys
prescription drug benefit plan was actuarially equivalent of benefits provided under Medicare
part D could not be made, pending issuance of final guidance on making such a determination.
During 2005, based on final guidance, a determination was made that the Companys prescription
drug benefit plan is actuarially equivalent to the prescription drug benefits under Medicare
Part D. As a result, the Company will qualify for a Federal subsidy relative to its
prescription drug benefit plan. The effect of this subsidy was to reduce the accumulated
postretirement benefit obligation by $12,778 at December 31, 2005 and to reduce the net periodic
benefit cost for postretirement benefits by $1,910 for the year ended December 31, 2005.The Company uses a December 31 measurement date for all benefit plans.
 71




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##### Table of Contents



Pension Benefits
    
    
    
    Postretirement BenefitsDecember 31,
    
    
    
    December 31,2005
    
    
    2004
    
    
    
    2005
    
    
    2004Change in benefit obligation:Benefit obligation, beginning of year
    
    $
    4,187
    
    
    $
    1,854
    
    
    
    $
    91,568
    
    
    $
    125,205Service cost
    
    
    157
    
    
    
    78
    
    
    
    
    1,458
    
    
    
    2,232Interest cost
    
    
    246
    
    
    
    116
    
    
    
    
    5,041
    
    
    
    6,642Job buyout program
    
    
    4,616
    
    
    
    
    
    
    
    
    
    
    
    
    Plan amendments
    
    
    
    
    
    
    930
    
    
    
    
    
    
    
    
    (34,309
    )Actuarial (gain) loss
    
    
    168
    
    
    
    1,308
    
    
    
    
    833
    
    
    
    (2,495
    )Benefits paid
    
    
    (72
    )
    
    
    (99
    )
    
    
    
    (3,312
    )
    
    
    (5,707
    )Benefit obligation, end of year
    
    $
    9,302
    
    
    $
    4,187
    
    
    
    $
    95,588
    
    
    $
    91,568
 Pension Benefits
    
    
    
    Postretirement BenefitsDecember 31,
    
    
    
    December 31,2005
    
    
    2004
    
    
    
    2005
    
    
    2004Change in plan assets:Fair value of plan assets beginning of year
    
    $
    
    
    
    $
    
    
    
    
    $
    
    
    
    $
    Actual return on plan assets
    
    
    52
    
    
    
    
    
    
    
    
    
    
    
    
    Company contributions
    
    
    2,069
    
    
    
    99
    
    
    
    
    3,312
    
    
    
    5,706Job buyout program assets
    
    
    4,584
    
    
    
    
    
    
    
    
    
    
    
    
    Benefits paid
    
    
    (72
    )
    
    
    (99
    )
    
    
    
    (3,312
    )
    
    
    (5,706
    )Fair value of plan assets end of year
    
    $
    6,633
    
    
    $
    
    
    
    
    $
    
    
    
    $
    Funded status of plans:Fair value of plan assets
    
    $
    (2,669
    )
    
    $
    (4,187
    )
    
    
    $
    (95,588
    )
    
    $
    (91,568
    )Unrecognized actuarial loss
    
    
    1,502
    
    
    
    1,462
    
    
    
    
    21,879
    
    
    
    21,974Unrecognized prior service cost (benefit)
    
    
    2,147
    
    
    
    2,371
    
    
    
    
    (29,000
    )
    
    
    (33,901
    )Net amount recognized
    
    $
    980
    
    
    $
    (354
    )
    
    
    $
    (102,709
    )
    
    $
    (103,495
    )Amount recognized in consolidated
balance sheet:Intangible pension asset, included in
deferred charges and other assets
    
    $
    1,434
    
    
    $
    1,001
    
    
    
    $
    
    
    
    $
    Payroll and employee benefits payable
    
    
    
    
    
    
    
    
    
    
    
    (6,000
    )
    
    
    (6,000
    )Other employee benefits liabilities
    
    
    (454
    )
    
    
    (1,355
    )
    
    
    
    (96,709
    )
    
    
    (97,495
    )Net amount recognized
    
    $
    980
    
    
    $
    (354
    )
    
    
    $
    (102,709
    )
    
    $
    (103,495
    )
   72




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##### Table of Contents



Reorganized
    
    
    
    
    
    PredecessorCompany
    
    
    
    CompanyFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003Pension benefitsNet periodic benefit cost:Service cost
    
    $
    157
    
    
    $
    78
    
    
    $
    29
    
    
    
    $
    Interest cost
    
    
    246
    
    
    
    116
    
    
    
    48
    
    
    
    
    Amoritization of prior service cost
    
    
    224
    
    
    
    129
    
    
    
    53
    
    
    
    
    Recognized actuarial loss
    
    
    108
    
    
    
    
    
    
    
    
    
    
    
    
    Net periodic benefit cost
    
    $
    735
    
    
    $
    323
    
    
    $
    130
    
    
    
    $
    
 Reorganized
        
    
    
    
    PredecessorCompany
    
    
    
    CompanyFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003Postretirement benefitsNet periodic benefit cost:Service cost
    
    $
    1,458
    
    
    $
    2,232
    
    
    $
    1,042
    
    
    
    $
    1,701Interest cost
    
    
    5,041
    
    
    
    6,642
    
    
    
    2,965
    
    
    
    
    11,586Amoritization of prior service cost
    
    
    (4,901
    )
    
    
    (408
    )
    
    
    
    
    
    
    
    (1,582
    )Recognized actuarial (gain) loss
    
    
    928
    
    
    
    408
    
    
    
    
    
    
    
    
    (1,770
    )Net periodic benefit cost
    
    $
    2,526
    
    
    $
    8,874
    
    
    $
    4,007
    
    
    
    $
    9,935
  At December 31,2005
    
    
    2004Expected long-term rate of return
    
    
    8.50
    %
    
    
    0.00
    %Discount rate  pension benefit obligation
    
    
    5.50
    %
    
    
    5.75
    %Discount
rate  postretirement benefit obligation
    
    
    5.75
    %
    
    
    5.75
    %Rate of compensation increase
    
    
    4.00
    %
    
    
    4.00
    %
 Years EndedDecember 31,
    
    December 31,
    
    December 31,2005
    
    2004
    
    2003Expected long-term rate of return
    
    
    8.50
    %
    
    
    0.00
    %
    
    
    0.00
    %Discount rate  pension benefit obligation
    
    
    5.75
    %
    
    
    6.00
    %
    
    
    6.50
    %Discount rate  postretirement benefit obligation
    
    
    5.75
    %
    
    
    6.00
    %
    
    
    6.50
    %Rate of compensation increase
    
    
    4.00
    %
    
    
    0.00
    %
    
    
    
  73




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corporate bonds as matched to the projected plan payments, a substantial portion of which
will be made over a period of time not exceeding ten years.At December 31, 2005, a discount rate of 5.75% was assumed to determine the postretirement
benefit obligation. The plan provides benefits to hourly employees retiring after October 1,
2003 and to salaried employees. For hourly employees who retired prior to October 1, 2003,
similar benefits are provided through a VEBA trust, as discussed in Note 21. As a result, the
benefit obligation is expected to be satisfied over an extended period of time. For this
reason, a discount rate associated with high quality, long-term corporate bonds was used.Assumed health care cost trend rates were as follows:
 At December 31,2005
    
    
    2004Health care cost trend rate assumed for next year
    
    
    10.00
    %
    
    
    11.00
    %Rate to which the cost trend rate gradually declines
    
    
    5.00
    %
    
    
    5.00
    %Year that the rate reaches the rate at which it is assumed to remain
    
    
    2012
    
    
    
    2011
 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
    
    $
    159
    
    
    $
    (166
    )Effect on accumulated benefit
obligation
    
    $
    1,835
    
    
    $
    (1,988
    )
 The Company expects to make the following contributions and make the following benefit payments
with respect to its benefit plans:
 Pension
    
    
    PostretirementBenefits
    
    
    BenefitsEmployer
contributions  2006
    
    $
    Expected benefit payments:2006
    
    
    2,397
    
    
    $
    4,4822007
    
    
    1,649
    
    
    
    4,8622008
    
    
    1,194
    
    
    
    5,5142009
    
    
    921
    
    
    
    6,2302010
    
    
    683
    
    
    
    6,9632011 - 2015
    
    
    3,393
    
    
    
    43,711
 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 2005, 2004, the five months ended
December 31, 2003 and the seven months ended July 31, 2003 amounted to $3,010, $2,647, $1,137
and $1,591, 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. During 2005, the Company made matching contributions to the salaried
savings plan of $618, all of which was made in the form of 34,665 shares of common stock of the
Company. The Company did not make matching contributions to these savings plans during 2004,
the five months ended December 31, 2003 and the seven months ended
July 31, 2003.
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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 were
$1,987 at December 31, 2005 and 2004, respectively. In 2003 the courts determined that certain
retirees and dependents were not the responsibility of the Company. During the fourth quarter
of 2003, the Company received net cash proceeds of $7,167 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, 2005 and 2004 were $23,215
and $29,200, respectively. These amounts were determined using a discount rate of 5.75% at
December 31, 2005 and 2004, respectively, and are included in other employee benefit
liabilities.
 21.
    
    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%, in addition to 15% of operating cash flow up to
$30 per ton. Quarterly contributions are payable in cash or, at the discretion of the Company,
in common stock of the Company.During 2005, the Company incurred VEBA expense of $4,725 under the plan. Of this amount, $1,500
was satisfied with pre-funded amounts. The Company satisfied $3,200 of the obligation by
issuing 151,929 shares of common stock to the plan during 2005. The remaining portion of the
obligation was settled in cash. During 2004, the Company incurred an obligation under the plan
of $22,949. Of this amount, $11,287 was satisfied with pre-funded amounts, resulting in net
VEBA expense of $11,662 for the year. The Company satisfied $6,527 of the obligation by issuing
44,069 and 169,622 shares of common stock to the plan during 2005 and 2004, respectively. The
remaining portion of the obligation was settled in cash. At December 31, 2005, the VEBA trust
held 3,965,620 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 2005, the Company incurred profit sharing expense of $143. The Company
satisfied this obligation by issuing 7,968 shares of common stock to the plan during 2005.
During 2004, the Company incurred profit sharing expense of $16,454. The Company satisfied this
obligation by issuing 547,703 shares of common stock to the plan during the year.
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22.
    
    Income TaxesThe provision for income taxes consisted of the following:
 Reorganized
    
    
    
    PredecessorCompany
    
    
    
    CompanyFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003CurrentFederal tax provision (benefit)
    
    $
    (50
    )
    
    $
    841
    
    
    $
    9
    
    
    
    $
    (659
    )State tax provision
    
    
    (21
    )
    
    
    133
    
    
    
    6
    
    
    
    
    18Total
    
    
    (71
    )
    
    
    974
    
    
    
    15
    
    
    
    
    (641
    )DeferredFederal tax provision
    
    
    
    
    
    
    28,715
    
    
    
    
    
    
    
    
    State tax provision
    
    
    
    
    
    
    3,790
    
    
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    32,505
    
    
    
    
    
    
    
    
    Income tax provision (benefit)
    
    $
    (71
    )
    
    $
    33,479
    
    
    $
    15
    
    
    
    $
    (641
    )
 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
    
    
    
    PredecessorCompany
    
    
    
    CompanyFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003Income (loss) before taxes
    
    $
    (34,488
    )
    
    $
    95,710
    
    
    $
    (39,022
    )
    
    
    $
    322,790Tax provision (benefit at
statutory rate
    
    $
    (12,071
    )
    
    $
    33,499
    
    
    $
    (13,658
    )
    
    
    $
    112,977Increase (decrease) in tax due to:Equity income in affiliates
    
    
    (2,558
    )
    
    
    (4,110
    )
    
    
    (757
    )
    
    
    
    (712
    )State income tax, net
    
    
    
    
    
    
    3,836
    
    
    
    4
    
    
    
    
    12Change in valuation allowance
    
    
    13,736
    
    
    
    279
    
    
    
    14,364
    
    
    
    
    27,941Fresh start adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (140,205
    )Other
    
    
    822
    
    
    
    (25
    )
    
    
    62
    
    
    
    
    (654
    )Income tax provision (benefit)
    
    $
    (71
    )
    
    $
    33,479
    
    
    $
    15
    
    
    
    $
    (641
    )
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The components of deferred tax assets and liabilities were as follows:
 December 31,2005
    
    
    2004Assets:Postretirement and postemployment benefits
    
    $
    36,152
    
    
    $
    36,362Operating loss carryforwards (expiring 2011 - 2025)
    
    
    113,883
    
    
    
    83,311Minimum tax credit carryforwards
    
    
    797
    
    
    
    845Pension and other employee benefits
    
    
    9,609
    
    
    
    17,091Provision for expenses and losses
    
    
    19,115
    
    
    
    20,889Leases
    
    
    1,933
    
    
    
    5,389State income taxes, net
    
    
    11,052
    
    
    
    11,489Other
    
    
    11,055
    
    
    
    9,788203,596
    
    
    
    185,164Liabilities:Property, plant and equipment
    
    
    (56,636
    )
    
    
    (58,178
    )Inventory
    
    
    (32,699
    )
    
    
    (25,900
    )State income taxes, net
    
    
    (11,052
    )
    
    
    (11,489
    )Other
    
    
    (321
    )
    
    
    (445
    )(100,708
    )
    
    
    (96,012
    )Net
    
    
    102,888
    
    
    
    89,152Valuation allowance
    
    
    (102,888
    )
    
    
    (89,152
    )Net deferred tax asset (liability)
    
    $
    
    
    
    $
    
 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 $32,979.The statute of limitations has expired for years through 2001. 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.
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23.
    
    Common StockCommon stock share activity was as follows:
 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
    
    
    
    14,433,223Stock issued  employee benefit plans
    
    
    238,631
    
    
    
    
    
    
    
    238,631Stock issued  restricted stock award plan
    
    
    10,500
    
    
    
    
    
    
    
    10,500Restricted stock forfeiture
    
    
    
    
    
    
    2,666
    
    
    
    (2,666
    )Balance, December 31, 2005
    
    
    14,686,354
    
    
    
    6,666
    
    
    
    14,679,688
 24.
    
    Supplemental Cash Flow InformationCash payments for interest and taxes were as follows:
 Reorganized
    
    
    
    PredecessorCompany
    
    
    
    CompanyFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003Interest, net of capitalized amounts
    
    $
    14,247
    
    
    $
    12,509
    
    
    $
    6,267
    
    
    
    $
    7,827Income taxes (refund)
    
    
    181
    
    
    
    1,600
    
    
    
    
    
    
    
    
    (600
    )
 The Company acquired equipment for $1,092 under a capital lease obligation during 2005.25.
    
    Financial InstrumentsThe carrying value and the estimated fair value of the Companys financial instruments were as
follows:
 December 31, 2005
    
    
    December 31, 2004Fair Value
    
    
    Carrying Value
    
    
    Fair Value
    
    
    Carrying ValueCash and cash equivalents
    
    $
    8,863
    
    
    $
    8,863
    
    
    $
    31,198
    
    
    $
    31,198Revolving credit agreement
    
    
    17,300
    
    
    
    17,300
    
    
    
    
    
    
    
    Long-term debt:Senior secured term loan
    
    
    218,650
    
    
    
    218,650
    
    
    
    237,500
    
    
    
    237,500Other (see discussion below)
    
    
    96,807
    
    
    
    96,807
    
    
    
    96,083
    
    
    
    96,083
 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.Revolving credit agreement:Short-term debt carries a fair value rate of interest. The fair value of this instrument is
estimated to reasonably approximate its carrying value.
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Senior secured term loan:The senior secured term loan is a guaranteed loan 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.26.
    
    Commitments and ContingenciesEnvironmental MattersPrior 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, 2005 could total $2,865, 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) $2,331 related to a January 30, 1996 USEPA consent decree
for the Companys coke oven gas desulfurization facility; (b) $411 related to a July 1991 USEPA
consent decree for water discharges to the Ohio River; (c) $101 related to a September 20, 1999
Ohio EPA consent decree for the Companys coke oven gas desulfurization facility, and (d) $22
related to a 1992 USEPA consent order for other water discharges issues. The Company may have
defenses to these apparent exceedances.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 $489 was spent on these activities in 2005, $1,131 in 2004
and $629 in 2003. 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 $1,700, which has been
fully reserved by the Company. The Company currently expects this work to be substantially
complete by the end of 2007.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 submitted the results of this investigation to the USEPA in the third quarter of 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 $4,674 for such remediation measures.The Company has also accrued $400 related to a 1989 consent order issued by the USEPA for
surface impoundment issues at a coke plant facility owned by the Companys joint venture.In July 2005, an additional environmental liability was identified regarding the potential of
oil in the subsurface from historical operations to migrate into waters of the Commonwealth of
Pennsylvania. Consequently, a remediation plan was developed and implementation of this plan
commenced in the fourth quarter of 2005. An estimated expenditure of about $181 is expected to
be made in the first quarter of 2006 to address this environmental liability.Total accrued environmental liabilities amounted to $9,872 and $13,433 at December 31, 2005 and
December 31, 2004, respectively. These accruals were based on all information available to the
Company. As new
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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 $5,000.
 Capital expenditures for environmental projects totaled $7,410 for the year ended December 31,
2005. The Company estimates capital expenditures for environmental projects to be $5,830 for
2006, $6,150 for 2007 and $5,500 for 2008. 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.CommitmentsIn June 2005, the Company entered into a contract to purchase up to 20,000 tons of metallurgical
coal each month for the period August 2006 through May 2007 at a price of $94.50 per ton. The
contract requires the Company to pay an average buy-out cost of $7.50 per ton for each ton of
coal that is not taken under the contract. In addition, the Company made a prepayment of $5,100
under the terms of the contract, which will be applied ratably to reduce the cash cost of each
ton of coal delivered under the contract. This prepayment will be forfeited if coal is not
taken under 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 $600. In January 2006, the Company extended this
contract to purchase up to 11,500 tons of coal each month through December 31, 2007 at a price
ranging from $60 to $65 per ton. Payments for delivery of coal totaled $8,271 in 2005, $ 9,530
in 2004 and $11,760 in 2003 under this contract.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 $600, subject to escalation clauses. Payments for delivery of oxygen
totaled $10,621 in 2005, $14,200 in 2004 and $9,300 in 2003 under this contract.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 $500, subject to increases for inflation, and a variable charge calculated at a
minimum of $3.75 times the number of tons of iron produced each month with an agreed-to minimum
of 3,000 tons per day, regardless of whether any
tons are produced. Payments for delivery of steam and electricity totaled $9,652 in 2005,
$9,150 in 2004 and $8,819 in 2003 under this contract. At December 31, 2005, a maximum
termination payment of $30,700 would have been required to terminate the contract to terminate
the contract.Under terms of a joint venture agreement, the Company and its joint venture partner have
committed to spend approximately $63,900, $12,100, $9,000 and $9,000 in 2006, 2007, 2008 and
2009, respectively, to refurbish a coke plant facility owned by the joint venture. The
Companys joint venture partner is committed to provide $60,000 in 2006 to fund these
expenditures.GuaranteesIn January 2005, the Company entered into an operating lease for certain mobile equipment, which
contains a residual lease guarantee approximating $357. This residual lease guarantee has been
reflected in the financial statements as an obligation and is included in other current
liabilities.OtherThe 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.
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27.
    
    Subsequent EventOn March 10, 2006, the Company reached agreement with both the lenders under its term loan
agreement and the Emergency Steel Loan Guarantee Board (the Loan Board), the Federal loan
guarantor, to waive compliance with the leverage, interest coverage and fixed charge coverage
ratios under its term loan agreement through the quarter ending
June 30, 2007. In addition, the
Companys term loan amendment requires it to maintain minimum borrowing availability of at least
$50,000 under its revolving credit agreement at all times or to comply with a minimum fixed
charge coverage ratio, similar to the provision in its revolving credit agreement.28.
    
    Summarized Financial Information of Affiliates  UnauditedThe 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 31,2005
    
    
    2004Current assets
    
    $
    171,745
    
    
    $
    151,131Noncurrent assets
    
    
    92,828
    
    
    
    103,132Total assets
    
    $
    264,573
    
    
    $
    254,263Current liabilities
    
    $
    60,005
    
    
    $
    48,287Noncurrent liabilities
    
    
    33,390
    
    
    
    37,673Total liabilities
    
    
    93,395
    
    
    
    85,960Total equity
    
    
    171,178
    
    
    
    168,303Total liabilities and equity
    
    $
    264,573
    
    
    $
    254,263
 Reorganized
    
    
    
    PredecessorCompany
    
    
    
    CompanyFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003Net sales
    
    $
    605,739
    
    
    $
    708,423
    
    
    $
    215,031
    
    
    
    $
    302,293Cost of goods sold
    
    
    550,703
    
    
    
    631,001
    
    
    
    199,429
    
    
    
    
    276,641Other operating costs
    
    
    29,882
    
    
    
    25,306
    
    
    
    7,942
    
    
    
    
    17,336Operating income
    
    
    25,154
    
    
    
    52,116
    
    
    
    7,660
    
    
    
    
    8,316Non-operating income (loss)
    
    
    (104
    )
    
    
    (1,623
    )
    
    
    (971
    )
    
    
    
    (1,502
    )Provision for income taxes
    
    
    (8,175
    )
    
    
    (16,617
    )
    
    
    (1,452
    )
    
    
    
    (1,302
    )Net income
    
    $
    16,875
    
    
    $
    33,876
    
    
    $
    5,237
    
    
    
    $
    5,512
 Amounts previously reported as of December 31, 2004 and for the year then ended have been
adjusted to reflect actual amounts, after all audit adjustments.29.
    
    Summarized Combined Financial InformationWPSC, 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
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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 $275,000 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.
 CONDENSED CONSOLIDATING BALANCE SHEET
December 31, 2005
Reorganized Company
 ConsolidatingWPC and
    
    
    
    
    
    
    andSubsidiary
    
    
    
    
    
    
    Eliminating
    
    
    WPCGuarantors
    
    
    WPSC
    
    
    Entries
    
    
    ConsolidatedAssetsCash and cash equivalents
    
    $
    
    
    
    $
    8,863
    
    
    $
    
    
    
    $
    8,863Trade accounts receivables
    
    
    
    
    
    
    132,643
    
    
    
    
    
    
    
    132,643Inventories
    
    
    
    
    
    
    166,566
    
    
    
    
    
    
    
    166,566Other current assets
    
    
    122
    
    
    
    21,610
    
    
    
    
    
    
    
    21,732Total current assets
    
    
    122
    
    
    
    329,682
    
    
    
    
    
    
    
    329,804Intercompany receivables
    
    
    
    
    
    
    4,940
    
    
    
    (4,940
    )
    
    
    Investments and advances in affiliates
    
    
    267,569
    
    
    
    55,100
    
    
    
    (267,569
    )
    
    
    55,100Property, plant and equipment  net
    
    
    2,255
    
    
    
    555,245
    
    
    
    
    
    
    
    557,500Restricted cash
    
    
    
    
    
    
    13,691
    
    
    
    
    
    
    
    13,691Other non-current assets
    
    
    896
    
    
    
    63,257
    
    
    
    
    
    
    
    64,153Total assets
    
    $
    270,842
    
    
    $
    1,021,915
    
    
    $
    (272,509
    )
    
    $
    1,020,248Liabilities and stockholders equityAccounts payable
    
    $
    
    
    
    $
    117,821
    
    
    $
    
    
    
    $
    117,821Other current liabilities
    
    
    276
    
    
    
    141,785
    
    
    
    
    
    
    
    142,061Total current liabilities
    
    
    276
    
    
    
    259,606
    
    
    
    
    
    
    
    259,882Intercompany payable
    
    
    4,940
    
    
    
    
    
    
    
    (4,940
    )
    
    
    Long-term debt
    
    
    
    
    
    
    284,100
    
    
    
    
    
    
    
    284,100Other non-current liabilities
    
    
    122
    
    
    
    136,406
    
    
    
    
    
    
    
    136,528Minority interest
    
    
    
    
    
    
    74,234
    
    
    
    
    
    
    
    74,234Stockholders equity
    
    
    265,504
    
    
    
    267,569
    
    
    
    (267,569
    )
    
    
    265,504Total liabilities and stockholders equity
    
    $
    270,842
    
    
    $
    1,021,915
    
    
    $
    (272,509
    )
    
    $
    1,020,248
 82




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##### Table of Contents



CONDENSED CONSOLIDATING BALANCE SHEET
December 31, 2004
Reorganized Company
 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
    
    
    1,023
    
    
    
    39,308
    
    
    
    
    
    
    
    40,331Total assets
    
    $
    294,970
    
    
    $
    956,216
    
    
    $
    (295,700
    )
    
    $
    955,486Liabilities 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
    
    
    290,605
    
    
    
    291,625
    
    
    
    (291,625
    )
    
    
    290,605Total liabilities and stockholders equity
    
    $
    294,970
    
    
    $
    956,216
    
    
    $
    (295,700
    )
    
    $
    955,486
 83




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##### Table of Contents



CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
Year Ended December 31, 2005
Reorganized Company
 ConsolidatingWPC and
    
    
    
    
    
    
    andSubsidiary
    
    
    
    
    
    
    Eliminating
    
    
    WPCGuarantors
    
    
    WPSC
    
    
    Entries
    
    
    ConsolidatedIncome DataNet sales
    
    $
    
    
    
    $
    1,560,513
    
    
    $
    
    
    
    $
    1,560,513Cost of products sold
    
    
    
    
    
    
    1,479,474
    
    
    
    
    
    
    
    1,479,474Depreciation and amortizaton expense
    
    
    
    
    
    
    33,984
    
    
    
    
    
    
    
    33,984Selling, administrative and general expense
    
    
    1,397
    
    
    
    70,155
    
    
    
    
    
    
    
    71,552Operating loss
    
    
    (1,397
    )
    
    
    (23,100
    )
    
    
    
    
    
    
    (24,497
    )Interest expense
    
    
    
    
    
    
    (21,834
    )
    
    
    
    
    
    
    (21,834
    )Other income including equity earnings
of affiliates
    
    
    (32,437
    )
    
    
    11,620
    
    
    
    32,660
    
    
    
    11,843Loss before income taxes
    
    
    (33,834
    )
    
    
    (33,314
    )
    
    
    32,660
    
    
    
    (34,488
    )Income tax provision (benefit)
    
    
    
    
    
    
    (71
    )
    
    
    
    
    
    
    (71
    )Loss before minority interest
    
    
    (33,834
    )
    
    
    (33,243
    )
    
    
    32,660
    
    
    
    (34,417
    )Minority interest
    
    
    
    
    
    
    583
    
    
    
    
    
    
    
    583Net loss
    
    $
    (33,834
    )
    
    $
    (32,660
    )
    
    $
    32,660
    
    
    $
    (33,834
    )
 CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
Year Ended December 31, 2004
Reorganized Company
 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 amortizaton expense
    
    
    
    
    
    
    33,433
    
    
    
    
    
    
    
    33,433Selling, administrative and general expense
    
    
    1,503
    
    
    
    66,117
    
    
    
    
    
    
    
    67,620Operating income (loss)
    
    
    (1,503
    )
    
    
    99,471
    
    
    
    
    
    
    
    97,968Interest expense
    
    
    
    
    
    
    (19,778
    )
    
    
    
    
    
    
    (19,778
    )Other income including equity earnings
of affiliates
    
    
    63,260
    
    
    
    17,520
    
    
    
    (63,260
    )
    
    
    17,520Income before income taxes
    
    
    61,757
    
    
    
    97,213
    
    
    
    (63,260
    )
    
    
    95,710Income tax provision (benefit)
    
    
    (474
    )
    
    
    33,953
    
    
    
    
    
    
    
    33,479Net income
    
    $
    62,231
    
    
    $
    63,260
    
    
    $
    (63,260
    )
    
    $
    62,231
 84




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##### Table of Contents



CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
Five Months Ended December 31, 2003
Reorganized Company
 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
    
    
    496
    
    
    
    23,175
    
    
    
    
    
    
    
    23,671Reorganization and professional fee expense
    
    
    (35
    )
    
    
    
    
    
    
    
    
    
    
    (35
    )Operating loss
    
    
    (461
    )
    
    
    (32,696
    )
    
    
    
    
    
    
    (33,157
    )Interest expense
    
    
    
    
    
    
    (10,215
    )
    
    
    
    
    
    
    (10,215
    )Other income including equity earnings
of affiliates
    
    
    (38,576
    )
    
    
    4,350
    
    
    
    38,576
    
    
    
    4,350Loss before income taxes
    
    
    (39,037
    )
    
    
    (38,561
    )
    
    
    38,576
    
    
    
    (39,022
    )Income tax provision
    
    
    
    
    
    
    15
    
    
    
    
    
    
    
    15Net loss
    
    $
    (39,037
    )
    
    $
    (38,576
    )
    
    $
    38,576
    
    
    $
    (39,037
    )
 CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
Seven Months Ended July 31, 2003
Predecessor Company
 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
    
    
    
    
    
    
    400,075
    
    
    
    
    
    
    
    400,075Income before income taxes
    
    
    327,280
    
    
    
    310,035
    
    
    
    (314,525
    )
    
    
    322,790Income tax provision (benefit)
    
    
    3,638
    
    
    
    (4,279
    )
    
    
    
    
    
    
    (641
    )Net income
    
    $
    323,642
    
    
    $
    314,314
    
    
    $
    (314,525
    )
    
    $
    323,431
 85




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##### Table of Contents



CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
Year Ended December 31, 2005
Reorganized Company
 ConsolidatingWPC and
    
    
    
    
    
    
    andSubsidiary
    
    
    
    
    
    
    Eliminating
    
    
    WPCGuarantors
    
    
    WPSC
    
    
    Entries
    
    
    ConsolidatedNet cash provided by operating activities
    
    $
    
    
    
    $
    11,557
    
    
    $
    
    
    
    $
    11,557Investing activities:Capital expenditures
    
    
    
    
    
    
    (103,710
    )
    
    
    
    
    
    
    (103,710
    )Restricted cash used to fund capital expenditures
    
    
    
    
    
    
    (1,189
    )
    
    
    
    
    
    
    (1,189
    )Other
    
    
    
    
    
    
    2,650
    
    
    
    
    
    
    
    2,650Net cash used in investing activities
    
    
    
    
    
    
    (102,249
    )
    
    
    
    
    
    
    (102,249
    )Financing activities:Net borrowings
    
    
    
    
    
    
    (3,769
    )
    
    
    
    
    
    
    (3,769
    )Book overdraft
    
    
    
    
    
    
    12,126
    
    
    
    
    
    
    
    12,126Minority interest in consoldiated subsidiary
    
    
    
    
    
    
    60,000
    
    
    
    
    
    
    
    60,000Net cash provided by financing activities
    
    
    
    
    
    
    68,357
    
    
    
    
    
    
    
    68,357Net change in cash and cash equivalents
    
    
    
    
    
    
    (22,335
    )
    
    
    
    
    
    
    (22,335
    )Cash and cash equivalents at beginning of period
    
    
    
    
    
    
    31,198
    
    
    
    
    
    
    
    31,198Cash and cash equivalents at end of period
    
    $
    
    
    
    $
    8,863
    
    
    $
    
    
    
    $
    8,863
 CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
Year Ended December 31, 2004
Reorganized Company
 ConsolidatingWPC and
    
    
    
    
    
    
    andSubsidiary
    
    
    
    
    
    
    Eliminating
    
    
    WPCGuarantors
    
    
    WPSC
    
    
    Entries
    
    
    ConsolidatedNet cash provided by operating activities
    
    $
    
    
    
    $
    72,025
    
    
    $
    
    
    
    $
    72,025Investing activities:Capital expenditures
    
    
    
    
    
    
    (132,442
    )
    
    
    
    
    
    
    (132,442
    )Restricted cash used to fund capital expenditures
    
    
    
    
    
    
    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
 86




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##### Table of Contents



CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
Five Months Ended December 31, 2003
Reorganized Company
 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
    )Restricted cash used to fund capital
expenditures
    
    
    
    
    
    
    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
 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
Seven Months Ended July 31, 2003
Predecessor Company
 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
 87




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##### Table of Contents



30.
    
    Revenues by ProductRevenues from external customers by product line were as follows:
 Reorganized
    
    
    
    PredecessorCompany
    
    
    
    CompanyFive Months
    
    
    
    Seven MonthsYear Ended
    
    
    Ended
    
    
    
    EndedDecember 31,
    
    
    December 31,
    
    
    
    July 31,2005
    
    
    2004
    
    
    2003
    
    
    
    2003Product:Hot Rolled
    
    $
    420,745
    
    
    $
    365,089
    
    
    $
    85,305
    
    
    
    $
    106,545Cold Rolled
    
    
    471,235
    
    
    
    514,511
    
    
    
    143,925
    
    
    
    
    243,841Galvanized
    
    
    109,264
    
    
    
    132,178
    
    
    
    22,575
    
    
    
    
    26,446Fabricated products
    
    
    466,914
    
    
    
    375,090
    
    
    
    137,137
    
    
    
    
    179,083Ore, coke and coke by products
    
    
    85,268
    
    
    
    9,074
    
    
    
    5,752
    
    
    
    
    9,155Conversion and other*
    
    
    7,087
    
    
    
    9,852
    
    
    
    2,208
    
    
    
    
    5,369Total
    
    $
    1,560,513
    
    
    $
    1,405,794
    
    
    $
    396,902
    
    
    
    $
    570,439
 
 *
    
    Includes conversion and resale products. 31.
    
    Selected Quarterly Financial Information (Unaudited)
Financial results by quarter were as follows: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 SharePredecessor Company20031st Quarter
    
    $
    238,672
    
    
    $
    (45,625
    )
    
    $
    (45,625
    )
    
    
    *
    
    
    
    *2nd Quarter
    
    
    250,469
    
    
    
    (21,474
    )
    
    
    (21,474
    )
    
    
    *
    
    
    
    *July
    
    
    81,298
    
    
    
    390,530
    **
    
    
    390,530
    
    
    
    *
    
    
    
    *Reorganized Company2003August and September
    
    $
    159,789
    
    
    $
    (15,237
    )
    
    $
    (15,237
    )
    
    $
    (1.60
    )
    
    $
    (1.60
    )4th Quarter
    
    
    237,113
    
    
    
    (23,693
    )
    
    
    (23,693
    )
    
    $
    (2.49
    )
    
    $
    (2.49
    )20041st Quarter
    
    $
    274,206
    
    
    $
    (6,718
    )
    
    $
    (6,718
    )
    
    $
    (0.71
    )
    
    $
    (0.71
    )2nd Quarter
    
    
    356,121
    
    
    
    26,997
    
    
    
    26,997
    
    
    $
    2.84
    
    
    $
    2.793rd Quarter
    
    
    401,800
    
    
    
    35,534
    
    
    
    35,534
    
    
    $
    3.52
    
    
    $
    3.424th Quarter
    
    
    373,667
    
    
    
    6,418
    
    
    
    6,418
    
    
    $
    0.46
    
    
    $
    0.45
 88




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Income (loss)
    
    
    
    
    Basic
    

    
    Fully Dilutedfrom
    
    
    Net
    
    
    Earnings
    
    
    EarningsContinuing
    
    
    Income
    
    
    (loss)
    
    
    (loss)Net Sales
    
    
    Operations
    
    
    (loss)
    
    
    Per Share
    
    
    Per ShareReorganized Company20051st Quarter
    
    $
    399,508
    
    
    $
    8,100
    
    
    $
    8,100
    
    
    $
    0.57
    
    
    $
    0.562nd Quarter
    
    
    415,237
    
    
    
    2,627
    
    
    
    2,627
    
    
    $
    0.18
    
    
    $
    0.183rd Quarter
    
    
    374,891
    
    
    
    (21,147
    )
    
    
    (21,147
    )
    
    $
    (1.47
    )
    
    $
    (1.47
    )4th Quarter
    
    
    370,877
    
    
    
    (23,414
    )
    
    
    (23,414
    )
    
    $
    (1.61
    )
    
    $
    (1.61
    )
 
 *
    
    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.
 
 Item 9.
    
    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
  
 Item 9A. CONTROLS AND PROCEDURES
 Conclusions Regarding the Effectiveness of Disclosure Controls and Procedures
  Managements Report on Internal Control Over Financial Reporting
  Attestation Report of Registered Public Accounting Firm
  Change in Internal Control Over Financial Reporting
  
 Item 9B. OTHER INFORMATION
  89




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PART III
 
 Item 10. DIRECTORS AND OFFICERS OF THE COMPANY
  Name
    
    Age
    
    PositionJames G. Bradley
    
    60
    
    Chairman of the Board and Class 3 Director of WPC,President and Chief Executive Officer of WPC,Chairman of the Board and Chief Executive Officerof WPSC and Director of WPSCPaul J. Mooney
    
    54
    
    Executive Vice President and Chief Financial Officerof WPC and WPSC, Class 1 Director of WPC andDirector of WPSCHarry L. Page
    
    59
    
    President and Chief Operating Officer of WPSCJohn W. Testa
    
    69
    
    Vice President, Secretary and Treasurer of WPC,Senior Vice President, Chief Restructuring Officerand Secretary of WPSC and Director of WPSCDaniel C. Keaton
    
    55
    
    Senior Vice President, Human Resources and PublicRelations of WPSCDonald E. Keaton
    
    47
    
    Vice President, Steel Manufacturing andProcurement of WPSCJames E. Muldoon
    
    62
    
    Vice President, Business Development, of WPSCSteven W. Sorvold
    
    51
    
    Vice President, Commercial, of WPSC and ChiefOperating Officer of Wheeling Corrugating  CompanyMichael P. DiClemente
    
    52
    
    Treasurer of WPSCJames L. Bowen
    
    70
    
    Class 2 Director of WPCEdward J. Curry, Jr.
    
    59
    
    Class 3 Director of WPCMichael D. Dingman, Jr.
    
    52
    
    Class 2 Director of WPCRobert E. Heaton
    
    75
    
    Class 3 Director of WPCRoland L. Hobbs
    
    73
    
    Class 2 Director of WPC and Director of WPSCAlicia H. Munnell
    
    63
    
    Class 1 Director of WPCD. Clark Ogle
    
    59
    
    Class 2 Director of WPCJames B. Riley
    
    54
    
    Class 3 Director of WPCLynn R. Williams
    
    81
    
    Class 1 Director of WPC
   90




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91




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##### Table of Contents



92




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COMPOSITION OF THE BOARD OF DIRECTORS
    COMMITTEES OF THE BOARD OF DIRECTORS
  Audit committee
  93




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Compensation committee
  Nominating/governance committee
  Executive committee
  Safety committee
  Finance committee
  COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPANTS
  Code of Ethics
  94




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Section 16(a) Beneficial Ownership Reporting Compliance
  
 Item 11. EXECUTIVE COMPENSATION
  Summary Compensation Table
 Long-termAnnual Compensation
    
    
    CompensationRestrictedOther Annual
    
    
    Stock
    
    
    All OtherName and Principal Position
    
    Year
    
    
    Salary
    
    
    Bonus
    
    
    Compensation (1)
    
    
    Awards (2)
    
    
    Compensation (3)James G. Bradley (9)
    
    
    2005
    
    
    $
    520,000
    
    
    $
    300,000
    (4)
    
    $
    
    
    
    $
    
    
    
    $
    35,325
    (5)(6)President and Chief Executive
    
    
    2004
    
    
    
    404,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    35,025
    (5)(6)Officer of WPC and Chief
    
    
    2003
    
    
    
    371,088
    
    
    
    
    
    
    
    
    
    
    $
    900,000
    
    
    
    34,500
    (5)(6)Executive Officer of WPSCPaul J. Mooney
    
    
    2005
    
    
    
    275,000
    
    
    
    250,250
    (4)(7)
    
    
    
    
    
    
    
    
    
    
    20,902
    (5)Executive Vice President and
    
    
    2004
    
    
    
    264,000
    
    
    
    44,000
    (7)
    
    
    
    
    
    
    
    
    
    
    20,477
    (5)Chief Financial Officer of
    
    
    2003
    
    
    
    255,120
    
    
    
    44,000
    (7)
    
    
    
    
    
    
    642,855
    
    
    
    45,052
    (5)(8)WPC and WPSCHarry L. Page
    
    
    2005
    
    
    
    237,503
    
    
    
    169,100
    (4)
    
    
    
    
    
    
    
    
    
    
    31,775
    (6)President and Chief
    
    
    2004
    
    
    
    163,200
    
    
    
    27,200
    (7)
    
    
    
    
    
    
    
    
    
    
    29,850
    (6)Operating Officer of WPSC
    
    
    2003
    
    
    
    157,657
    
    
    
    27,200
    (7)
    
    
    
    
    
    
    642,855
    
    
    
    29,850
    (6)Donald E. Keaton
    
    
    2005
    
    
    
    196,803
    
    
    
    135,000
    (4)(7)
    
    
    
    
    
    
    
    
    
    
    21,157
    (5)Vice President of WPSC
    
    
    2004
    
    
    
    179,723
    
    
    
    28,800
    (7)
    
    
    
    
    
    
    
    
    
    
    17,150
    (5)2003
    
    
    
    171,808
    
    
    
    28,800
    (7)
    
    
    
    
    
    
    642,855
    
    
    
    14,900
    (5)Daniel C. Keaton
    
    
    2005
    
    
    
    175,000
    
    
    
    150,150
    (4)(7)
    
    
    
    
    
    
    
    
    
    
    14,575Senior Vice President
    
    
    2004
    
    
    
    158,400
    
    
    
    26,400
    (7)
    
    
    
    
    
    
    
    
    
    
    18,025of WPSC
    
    
    2003
    
    
    
    147,641
    
    
    
    26,400
    (7)
    
    
    
    
    
    
    642,855
    
    
    
    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, one-third will vest two business days after the date on which we
released earnings for the second quarter of 2005and one-third will vest two business days
after the date on which we release earnings for the second quarter of 2006. Based on the
closing price of WPC common stock at December 31, 2005, the dollar value of restricted stock
holdings for each named executive officer was as follows: $288,640 with respect to 32,000
restricted shares held by Mr. Bradley, $161,205 with respect to 17,872 restricted shares held
by Mr. Mooney, $184,486 with respect to 20,453 95




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##### Table of Contents



restricted shares held by Mr. Donald Keaton, $128,860 with respect to 14,286 restricted shares
held by Mr. Page, and $184,486 with respect to 20,453 restricted shares held by Mr. Daniel
Keaton. Shares of restricted stock awarded under the restricted stock plan are entitled to
receive dividends, if any, declared on the common stock, except where such restricted shares
have been forfeited.(3)
    
    Amounts shown, unless otherwise noted, reflect company contributions to qualified pension
plans.(4)
    
    Includes 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 includes 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, January, 2005 and January 2006.(8)
    
    Includes a payment of $25,000 in lieu of insurance premium in 2003 and 2002.(9)
    
    Mr. Bradleys salary was increased to $520,000 per annum effective November 1, 2004. PENSION PLAN
   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
    96




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CERTAIN BENEFIT PLANS
  2003 Management Stock Incentive Plan
  2003 Restricted Stock Plan
  Employment Contracts, Termination of Employment and Change-in-Control Arrangements
   97




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98




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DIRECTOR COMPENSATION
  
 Item 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED              STOCKHOLDER
MATTERS
 Principal
Stockholders
  
    
    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.
  99




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##### Table of Contents



Common SharesBeneficially OwnedName and Address of Beneficial Owner
    
    Number
    
    Percentage (1)Wheeling-Pittsburgh
Steel Corporation Retiree Benefits Plan Trust (2)
    
    
    3,465,620
    
    
    
    23.49
    %Wellington Management Company, LLP (3)
    
    
    2,042,122
    
    
    
    13.84
    %Jeffery L.
Gendell (4)
    
    
    1,422,778
    
    
    
    9.64
    %Spears Grisanti & Brown LLC (5)
    
    
    1,229,571
    
    
    
    8.33
    %FMR Corp. (6)
    
    
    841,516
    
    
    
    5.70
    %Jim Bowen (7)
    
    
    7,011
    
    
    
    
    *Edward J.
Curry, Jr. (7)
    
    
    7,011
    
    
    
    
    *Michael Dingman (7)
    
    
    6,659
    
    
    
    
    *Robert E.
Heaton (7)
    
    
    7,011
    
    
    
    
    *Roland L. Hobbs (7)
    
    
    7,011
    
    
    
    
    *Alicia H.
Munnell (7)
    
    
    7,011
    
    
    
    
    *D. Clark
Ogle (7)
    
    
    6,659
    
    
    
    
    *James B.
Riley (7)
    
    
    7,365
    
    
    
    
    *Lynn R. Williams (7)
    
    
    6,659
    
    
    
    
    *James G.
Bradley (8)
    
    
    32,000
    
    
    
    
    *Paul J.
Mooney (8)
    
    
    17,872
    
    
    
    
    *Harry L. Page (8)
    
    
    14,286
    
    
    
    
    *Daniel C.
Keaton (8)
    
    
    20,453
    
    
    
    
    *Donald E.
Keaton (8)
    
    
    20,453
    
    
    
    
    *All executive officers and directors as a group (18 persons) (9)
    
    
    237,127
    
    
    
    1.61
    %
 
 *
    
    Less than 1%.(1)
    
    As December 31, 2005, 32,014 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 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 U.S. 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 U.S. Trust Company, N.A. is 600 14th
Street, N.W. Washington, District of Columbia. 20005-3314. The address of the VEBA trust is
c/o WesBanco Bank, Inc., as trustee, One Bank Plaza, Wheeling, West Virginia 26003. Amendment
No. 3 to Schedule 13G filed with the Securities and Exchange Commission by U.S. Trust
Corporation, U.S. Trust Company of New York and U.S. Trust Company, N.A. on February 14. 2006
reports shared power to dispose or to direct the disposition of 412,980 additional shares (or
approximately 2.7% of the outstanding common stock) held by U.S. Trust Company, N.A. in its
capacity as trustee of our salaried 401K plan.(3)
    
    The number of shares beneficially owned is based solely on information reported in Amendment
No. 2 to Schedule 13G filed with the Securities and Exchange Commission by Wellington
Management Company, LLP on February 14, 2006 with respect to its holdings as of December 31,
2005. The address of Wellington Management Company, LLP is 75 State Street, Boston,
Massachusetts 02109.(4)
    
    Represents 768,523 shares held by Tontine Partners, L.P., 458,821 shares held by Tontine
Overseas Fund, Ltd., 119,010 shares held by Tontine Capital Partners, L.P. and 76,424 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 the
shares. Tontine Oversees Associates, L.L.C. serves as investment manager to Tontine Overseas
Fund, Ltd. with respect to the shares directly owned 100




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##### Table of Contents



by Tontine Overseas Fund Ltd. Tontine Capital Management, L.L.C., the general partner of
Tontine Capital Partners, L.P., has the power to direct the affairs of Tontine Capital Partners,
L.P., including decisions with respect to the disposition of proceeds from the sale of the
shares. Jeffrey L. Gendell is the managing member of Tontine Management, L.L.C., Tontine Capital
Management, L.L.C. and Tontine Overseas Associates, L.L.C. and in that capacity directs their
operations. The foregoing management information and number of shares beneficially owned is
based solely on information reported in Amendment No.3 to Schedule 13G filed with the Securities
and Exchange Commission by Tontine Partners, L.P., Tontine Management, L.L.C., Tontine Overseas
Associates, L.L.C., Tontine Capital Partners, L.P., Tontine Capital Management, L.L.C. and Mr.
Gendell on February 14, 2006 with respect to their holdings as of December 31, 2005. The
address of Tontine Partners, L.P., Tontine Management, L.L.C., Tontine Overseas Associates,
L.L.C., Tontine Capital Partners, L.P., Tontine Capital Management, L.L.C. and Jeffrey L.
Gendell is 55 Railroad Avenue, 3rd Floor, Greenwich, Connecticut 06830.(5)
    
    Includes 56,300 shares held by SGB Simurgh Master Fund Ltd. Spears Grisanti & Brown LLC is
the Investment Manager for Simurgh Master Fund Ltd. William G. Spears, Vance C. Brown and
Christopher C. Grisanti are the Managers of Spears Grisanti & Brown LLC. The foregoing
management information and number of shares beneficially owned is based solely on information
reported in Amendment No. 1 to Schedule 13G filed with the Securities and Exchange Commission
by Spears Grisanti & Brown LLC and Messrs. Spears, Brown and Grisanti on February 23, 2006
with respect to their holdings as of December 31, 2005. The address of Spears Grisanti &
Brown LLC and Messrs. Spears, Brown and Grisanti is c/o Spears Grisanti & Brown LLC, 45
Rockefeller Plaza, New York 10111.(6)
    
    The number of shares beneficially owned is based solely on information reported in Schedule
13G filed with the Securities and Exchange Commission by FMR Corp. on February 14, 2006 with
respect to its holdings as of December 31, 2005. Fidelity Management & Research Company, a
wholly-owned subsidiary of FMR Corp. and a registered investment advisor, is the beneficial
owner of the shares as a result of acting as investment advisor to Fidelity Low Priced Stock
Fund. Edward C. Johnson 3rd and FRM Corp., through its control of Fidelity Management &
Research Company and Fidelity Low Priced Stock Fund, each has the sole power to dispose of the
shares. Members of the family of Edward C. Johnson 3rd, chairman of FMR Corp., through their
ownership of voting common stock of FMR Corp. and the execution of a shareholders voting
agreement, may be deemed to form a controlling group with respect to FMR Corp. The address of
FMR Corp., Fidelity Management & Research Company, Fidelity Low Priced Stock Fund and Edward
C. Johnson 3rd is 82 Devonshire Street, Boston, Massachusetts 02109.(7)
    
    Represents shares issuable upon exercise of currently exercisable options to purchase shares
of WPC common stock.(8)
    
    Represents shares originally issued under our 2003 Restricted Stock Plan.(9)
    
    Includes shares held by Messrs. Bowen, Curry, Dingman, Heaton, Hobbs, Ogle, Riley, Williams,
Bradley, Mooney, Daniel C. Keaton, Donald E. 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, West Virginia 26003. Equity
Compensation Plan Information
  Number ofSecuritiesRemaining Available(a) Number of
    
    
    (b) Weighted
    
    
    for Future IssuanceSecurities to be
    
    
    Average Exercise
    
    
    Under EquityUpon Exercise of
    
    
    Price of
    
    
    CompensationOutstanding
    
    
    Outstanding
    
    
    Plans (excludingOptions, Warrants
    
    
    Options, Warrants
    
    
    Securities ReflectedEquity Compensation Plans
    
    and Rights
    
    
    and Rights
    
    
    in Column (a)Not approved by stockholders
    
    
    62,397
    
    
    $
    15.53
    
    
    
    927,103Approved by stockholders
    
    
    
    
    
    
    
    
    
    
    62,397
    
    
    $
    15.53
    
    
    
    927,103
 
 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 101




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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
      
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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
 Audit-Related Fees
 Tax Fees
 All Other Fees
 PRE-APPROVAL OF AUDIT AND NON-AUDIT SERVICES
  103




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PART IV
 
 Item 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
  (a)(1) Financial Statements
  (a)(3) Exhibits
  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.3.1(b)****
    
    Certificate of Designation of Series A Junior Participating Preferred Stock of
Wheeling-Pittsburgh Corporation.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 Shoji America), 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.10.8*
    
    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.
 104




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EXHIBITNUMBER
    
    DESCRIPTION OF EXHIBIT10.9*
    
    Modification and Assumption Agreement, dated as of June 12, 2003, between
Wheeling-Pittsburgh Steel Corporation and Danieli Corporation.10.10*
    
    Agreement for Supply of Equipment and Services, dated as of June 12, 2003, between
Junction Industries, Inc. and Wheeling-Pittsburgh Steel Corporation.10.11(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.10.11(b)*
    
    Lease for 9801 Alden Avenue, Lenexa, KS, dated as of March 27, 2000, between Lenexa
Alden, LLC and Wheeling-Pittsburgh Steel Corporation.10.11(c)*
    
    Lease for 8090 Woolery Way, Fallon, NV, dated as of August 1, 1999, between FBW
Leasecorp, Inc. and Wheeling-Pittsburgh Steel Corporation.10.11(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.10.11(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.10.11(f)*
    
    Lease for 2001 Highway 301, Palmetto, FL, dated April 27, 2000, between Palmetto
Business Park, LP and Wheeling-Pittsburgh Steel Corporation.10.12(a)****
    
    Amended and Restated Retention Agreement, effective as of February 16, 2005, between
James G. Bradley and Wheeling-Pittsburgh Steel Corporation.10.12(b)
    
    Amended and Restated Retention Agreement, effective as of February 15, 2006, between
Paul J. Mooney and Wheeling-Pittsburgh Steel Corporation (filed herewith).10.12(c)
    
    Amended and Restated Retention Agreement, effective as of February 15, 2006, between
Daniel C. Keaton and Wheeling-Pittsburgh Steel Corporation (filed herewith).10.12(d)
    
    Amended and Restated Retention Agreement, effective as of February 15 2006, between
Donald E. Keaton and Wheeling-Pittsburgh Steel Corporation (filed herewith).10.12(e)
    
    Amended and Restated Retention Agreement, effective as of February 15, 2006, between
Harry L. Page and Wheeling-Pittsburgh Steel Corporation (filed herewith).10.12(f)
    
    Amended and Restated Retention Agreement, effective as of February 15, 2006, between
John W. Testa and Wheeling-Pittsburgh Steel Corporation (filed herewith).10.12(g)
    
    Amended and Restated Retention Agreement, effective as of February 16, 2005, between
Steven W. Sorvold and Wheeling-Pittsburgh Steel Corporation (filed herewith).10.12(h)****
    
    Agreement, effective as of February 16, 2005, between James E. Muldoon and
Wheeling-Pittsburgh Steel Corporation.10.12(i)
    
    Agreement, effective as of February 15, 2006, between Michael P. DiClemente and
Wheeling-Pittsburgh Steel Corporation (filed herewith).10.13(a)*
    
    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.10.13(b)*
    
    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.10.14**
    
    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.10.15****
    
    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.
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EXHIBITNUMBER
    
    DESCRIPTION OF EXHIBIT10.16+
    
    Amended and Restated Revolving Loan Agreement, dated as of July 8, 2005, by and
between 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., Wachovia Bank, National Association and Fleet Capital Corp., as
syndication agents.10.17
    
    Amended and Restated Limited Liability Company Agreement of Mountain State Carbon,
LLC, dated September 29, 2005, by and between Wheeling-Pittsburgh Steel Corporation
and SNA Carbon, LLC.10.18
    
    Coke Supply Agreement, dated September 29, 2005, by and between Wheeling-Pittsburgh
Steel Corporation and Mountain State Carbon, LLC.10.19
    
    Third Amendment, effective as of September 29, 2005, 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.10.20
    
    Fourth Amendment and Waiver, dated
as of March 10, 2006, 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, the Administrative Agent named therein, the Emergency Steel Loan
Guarantee Board, and the West Virginia Housing Development Fund (filed herewith).10.21
    
    Amendment to 2003 Management Stock Incentive Plan (filed herewith).10.22
    
    Form of Restricted Stock Unit Award
Agreement (filed herewith).21.1
    
    Subsidiaries of Wheeling-Pittsburgh Corporation (filed herewith).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) of Wheeling-Pittsburgh Corporation, filed with the
SEC on February 18, 2005.****
    
    Incorporated by reference to the Annual Statement on Form 10-K (File
No. 0-50300) of Wheeling-Pittsburgh Corporation, filed with the SEC
on March 14, 2005.+
    
    Incorporated by
reference to the
Current Report on
Form 8-K (File No.
0-50300) of
Wheeling-Pittsburgh
Corporation, filed with the SEC on July 14, 2005.
    
    Incorporated by
reference to the
Current Report on
Form 8-K (File No.
0-50300) of
Wheeling-Pittsburgh
Corporation, filed with the SEC on October 5, 2005. 106




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SIGNATURES
  WHEELING-PITTSBURGH CORPORATION
 By:
    
    /s/ James G. BradleyName: James G. BradleyTitle: President, Chief Executive Officer and DirectorDate:
    
    March 14, 2006
  Signature
    
    Title
    
    Date/s/ James G. Bradley
    
    President, Chief Executive Officer
    
    March 14, 2006James G. Bradley
    
    and Director/s/ Paul J. Mooney
    
    Executive Vice President, Chief Financial
    
    March 14, 2006Paul J. Mooney
    
    Officer (and Principal Accounting Officer)and Director/s/ Jim Bowen
    
    Director
    
    March 14, 2006Jim Bowen/s/ Edward J. Curry, Jr.
    
    Director
    
    March 14, 2006Edward J. Curry, Jr./s/ Michael Dingman
    
    Director
    
    March 14, 2006Michael Dingman/s/ Robert E. Heaton
    
    Director
    
    March 14, 2006Robert E. Heaton/s/ Roland L. Hobbs
    
    Director
    
    March 14, 2006Roland L. Hobbs/s/ Alicia H. Munnell
    
    Director
    
    March 14, 2006Alicia H. Munnell/s/ D. Clark Ogle
    
    Director
    
    March 14, 2006D. Clark Ogle/s/ James B. Riley
    
    Director
    
    March 14, 2006James B. Riley/s/ Lynn R. Williams
    
    Director
    
    March 14, 2006Lynn R. Williams
 107