USSC – Dec 29, 2014
December 29, 2014
On December 23, 2014, we mailed a letter to all Non-USW Active Employees and Retirees providing an update on the CCAA proceedings. To view a copy of the letter dated December 23, 2014 please click here.
There have been a number of developments over the past few months, however, it is our view that the major restructuring of USSC is still in its early stages. The company has, however, done the following with the involvement of major stakeholders, including our firm:
a) obtained additional financing from U.S. Steel in Pittsburgh called “Debtor-in-Possession” Financing (“DIP”). The latest Monitor’s Report (the 5thReport) dated December 12, 2014 states that USSC has not yet drawn any funds on the DIP loan;
b) established a Claims Process to solicit the claims of creditors who claim to be owed amounts from USSC, with the exception of any claims based on the USSC pension plans or Other Post-Employment Benefits (“OPEBs”), which may be subject to a future claims process:
c) established a protocol for quantifying with greater precision the liabilities of USSC with respect to the pension plans and OPEBs. This process has recently started and will continue into 2015;
d) obtained approval from the court for a Key Employee Retention Plan (“KERP”) in the maximum amount of $2,570,378. The KERP operates as a stay bonus to incentivize certain key USSC employees to continue employment with the company during the CCAA proceeding, as those employees are considered critical to the restructuring process;
e) restarted the coke ovens at Hamilton Works and entered into a coke supply contract with U.S. Steel; and
f) began to formulate a sales process for the company to solicit bids from potential purchasers of all or parts of USSC.
As noted above, the company has indicated that it will be proceeding with a sales process to market itself for sale in early 2015. We have been provided with draft documents relating to the proposed sales process protocol and have sent comments on the draft protocol back to USSC. USSC has advised that they plan to have meetings with certain stakeholders, including us, prior to returning to court in 2015 to request an order for approval of the sales process protocol. We will keep you apprised of developments.
We will continue to provide regular updates to you as the CCAA proceeding moves forward, as well as posting updates on our firm website for USSC non-union retirees and active employees.
In addition to this website you can call our toll-free hotline at 1-866-777-6341, or e-mail us at email@example.com if you have any questions.