Exhibit 10.2

Execution Copy

 

 
 

Reliance Steel & Aluminum Co.

 

Omnibus Amendment
Dated as of June 13, 2005

to:

1996 Note Purchase Agreement

1997 Note Purchase Agreement

1998 Note Purchase Agreement
and
2003 Note Purchase Agreement

Each as described herein

 
 
 

 

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Omnibus Amendment

     This Omnibus Amendment, dated as of June 13, 2005 (the “Omnibus
Amendment”), to each of the Outstanding Agreements (as defined below) is among
Reliance Steel & Aluminum Co., a California corporation (the “Company”), and
each of the institutions which is a signatory to this Omnibus Amendment
(collectively, the “Noteholders”).

Recitals:

     A. The Company and the Noteholders have heretofore entered into the various
Note Agreements described on the attached Schedule A (collectively, the
“Outstanding Agreements”), pursuant to which the Company issued its Notes as
described on said Schedule A (collectively, the “Notes”). The Notes which are
presently outstanding are hereafter referred to as the “Outstanding Notes.”

     B. The Company and the Noteholders now desire to amend the Outstanding
Agreements in the respects, but only in the respects, hereinafter set forth.

     C. Capitalized terms used herein shall have the respective meanings
ascribed thereto in the Outstanding Agreements unless herein defined or the
context shall otherwise require.

     D. All requirements of law have been fully complied with and all other acts
and things necessary to make this Omnibus Amendment a valid, legal and binding
instrument according to its terms for the purposes herein expressed have been
done or performed.

     Now, therefore, upon the full and complete satisfaction of the conditions
precedent to the effectiveness of this Omnibus Amendment set forth in
Section 3.1 hereof, and in consideration of good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged, the Company and the
Noteholders do hereby agree as follows:

Section 1. Amendments.

     Section 1.1. Section 10.2 of each of the Outstanding Agreements shall be
and is hereby amended in its entirety to read as follows:

               Section 10.2. Subsidiary Debt. The Company will not permit any
Restricted Subsidiary to, directly or indirectly, create, incur, assume,
guarantee, or otherwise become directly or indirectly liable with respect to,
any Debt, except:

               (a) Debt of a Restricted Subsidiary owed to the Company or to a
Wholly-Owned Restricted Subsidiary;

 

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               (b) Debt of a Restricted Subsidiary outstanding on the date
hereof and disclosed in Schedule 5.15 hereto, provided that such Debt may not be
extended, renewed or refunded except as otherwise permitted by this Agreement;

               (c) Debt of a Restricted Subsidiary outstanding at the time such
Restricted Subsidiary becomes a Restricted Subsidiary, provided that (1) such
Debt shall not have been incurred in contemplation of such Restricted Subsidiary
becoming a Restricted Subsidiary and (2) immediately after such Restricted
Subsidiary becomes a Restricted Subsidiary no Default or Event of Default shall
exist, and provided, further, that such Debt may not be extended, renewed or
refunded except as otherwise permitted by this Agreement;

               (d) Debt of a Restricted Subsidiary in addition to that otherwise
permitted by the foregoing provisions of this Section 10.2, provided that on the
date the Restricted Subsidiary incurs or otherwise becomes liable with respect
to any such additional Debt and immediately after giving effect thereto and the
concurrent retirement of any other Debt, (1) no Default or Event of Default
exists and (2) the total amount of all Debt of Restricted Subsidiaries (other
than Debt permitted by Section 10.2(e)) plus all Debt of the Company secured by
Liens permitted by Section 10.5(k) does not exceed 10% of Consolidated Net
Worth; and

               (e) (i) Debt of any Restricted Subsidiary evidenced by the
Subsidiary Guaranty with respect to the Notes, (ii) Debt of any Restricted
Subsidiary which has delivered a Subsidiary Guaranty that remains in effect
which Debt shall be evidenced by a Guaranty in substantially the same form as
the Subsidiary Guaranty with respect to notes of the Company and (iii) Debt of
any Restricted Subsidiary which has delivered a Subsidiary Guaranty that remains
in effect which Debt shall constitute a Guaranty of, or a direct obligation
under, the Credit Agreement.

For the purposes of this Section 10.2, any Person becoming a Restricted
Subsidiary after the date hereof shall be deemed, at the time it becomes a
Restricted Subsidiary, to have incurred all of its then outstanding Debt.

     Section 1.2. Section 10.5(k) of the Outstanding Agreements shall be and is
hereby amended by adding the following paragraph at the end of such Section:

-2-

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               (k) other Liens not otherwise permitted by paragraphs (a) through
(j), securing Debt of the Company or any Restricted Subsidiary, provided that
the total amount of all Debt of Restricted Subsidiaries (other than Debt
permitted by Section 10.2(e)) plus all Debt of the Company secured by Liens
permitted by this paragraph (k) does not exceed 10% of Consolidated Net Worth.

     Section 1.3. Schedule B to each of the Outstanding Agreements shall be and
is hereby amended by adding thereto in the 1996 Note Purchase Agreement and the
1997 Note Purchase Agreement and amending in its entirety in the 1998 Note
Purchase Agreement and the 2003 Note Purchase Agreement, the definition of
“Credit Agreement” to read as follows:

“Credit Agreement” means that certain Credit Agreement dated as of October 24,
2001 among the Company, RSAC Management Corp., Bank of America, National
Association, as administrative agent and the other financial institutions party
thereto, as amended, (or any credit facility entered into in replacement
thereof, including, without limitation, any resulting increase in the principal
amount thereof, as may be amended, restated or replaced from time to time).

Section 2. Representations, Warranties and Agreements of the Company.

     Section 2.1. To induce the Noteholders to execute and deliver this Omnibus
Amendment, the Company represents and warrants to the Noteholders (which
representations and warranties shall survive the execution and delivery of this
Omnibus Amendment) that:

               (a) this Omnibus Amendment has been duly authorized, executed and
delivered by it and this Omnibus Amendment, and each of the Outstanding
Agreements as amended by this Omnibus Amendment, constitute the legal, valid and
binding obligations, contracts and agreements of the Company enforceable against
it in accordance with their respective terms, except as enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws or
equitable principles relating to or limiting creditors’ rights generally;

               (b) the execution, delivery and performance by the Company of
this Omnibus Amendment (i) has been duly authorized by all requisite corporate
action and, if required, shareholder action, (ii) does not require the consent
or approval of any governmental or regulatory body or agency, and (iii) will not
(A) violate (1) any provision of law, statute, rule or regulation or its
certificate of incorporation or bylaws, (2) any order of any court or any rule,
regulation or order of any other agency or government binding upon it, or
(3) any provision of any material indenture, agreement or other instrument to
which it is a party or by which its properties or assets are or may be bound, or
(B) result in a breach or constitute (alone or with due notice or lapse of time
or both) a default under any

-3-

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indenture, agreement or other instrument referred to in clause (iii)(A)(3) of
this Section 2.1(b);

               (c) as of the date hereof and after giving effect to this Omnibus
Amendment, no Default or Event of Default under any of the Outstanding
Agreements has occurred which is continuing; and

               (d) all of the representations and warranties contained in
Section 5 of each of the Outstanding Agreements are true and correct in all
material respects with the same force and effect as if made by the Company on
and as of the date hereof, except that any representation or warranty made as of
a specific date shall be deemed made as of such specific date and except any
schedule which is part of such representation or warranty shall be deemed to
read as set forth on the revised schedules attached hereto as Exhibit A.

Execution and delivery by the Company of this Omnibus Amendment constitutes the
certification by the Company that the foregoing representations and warranties
are true and correct on and with respect to the date hereof.

Section 3. Conditions to Effectiveness of This Omnibus Amendment.

     Section 3.1. This Omnibus Amendment shall not become effective until, and
shall become effective when, each and every one of the following conditions
shall have been satisfied:

               (a) executed counterparts of this Omnibus Amendment, duly
executed by the Company and the Required Holders of the Outstanding Notes under
each Outstanding Agreement, shall have been delivered to the Noteholders; and

               (b) the representations and warranties of the Company set forth
in Section 2 hereof are true and correct on and with respect to the date hereof
and the execution and delivery by the Company of this Omnibus Amendment shall
constitute certification of the same.

Upon receipt of all of the foregoing, this Omnibus Amendment shall become
effective.

Section 4. Payment of Noteholders’ Counsel Fees and Expenses.

     Section 4.1. The Company agrees to pay upon demand, the reasonable fees and
expenses of Chapman and Cutler LLP, counsel to the Noteholders, in connection
with the negotiation, preparation, approval, execution and delivery of this
Omnibus Amendment.

Section 5. Miscellaneous.

     Section 5.1. This Omnibus Amendment shall be construed in connection with
and as part of each of the Outstanding Agreements, and except as modified and
expressly amended by

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this Omnibus Amendment, all terms, conditions and covenants contained in each of
the Outstanding Agreements and each of the Outstanding Notes are hereby ratified
and shall be and remain in full force and effect.

     Section 5.2. Any and all notices, requests, certificates and other
instruments executed and delivered after the execution and delivery of this
Omnibus Amendment may refer to the Outstanding Agreements without making
specific reference to this Omnibus Amendment but nevertheless all such
references shall include this Omnibus Amendment unless the context otherwise
requires.

     Section 5.3. The descriptive headings of the various Sections or parts of
this Omnibus Amendment are for convenience only and shall not affect the meaning
or construction of any of the provisions hereof.

     Section 5.4. This Omnibus Amendment shall be governed by and construed in
accordance with New York law.

     Section 5.5. This Omnibus Amendment may be executed in any number of
counterparts, each executed counterpart constituting an original, but all
together only one agreement.

     Section 5.6. Upon termination of the Credit Agreement dated as of
October 24, 2001, the Noteholders hereby agree that the Intercreditor Agreement
among the Noteholders and the parties to the Credit Agreement shall be
terminated and no longer in effect.

[Signature Pages Follow]

-5-

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     In Witness Whereof, the parties hereto have executed and delivered this
Omnibus Amendment as of the date first written above

                  Reliance Steel & Aluminum Co.
 
                By   /s/ Karla Lewis          
 
      Name:   Karla Lewis
 
      Title:   Executive Vice President and
Chief Financial Officer

[Omnibus Amendment—Reliance Steel & Aluminum Co.]

-6-

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Accepted as of the date Omnibus written above:

              Allstate Life Insurance Company (as
 
      Noteholder under the 1997 Note Purchase
 
      Agreement and the 2003 Note Purchase
 
      Agreement)

         
 
  By   /s/ Robert B. Bodett          
 
      Name: Robert B. Bodett

         
 
  By   /s/ Jerry Zinkula          
 
      Name: Jerry Zinkula
 
            Authorized Signatories

              Allstate Life Insurance Company of New York
 
      (as Noteholder under the 2003 Note
 
      Purchase Agreement)

         
 
  By   /s/ Robert B. Bodett          
 
      Name: Robert B. Bodett
 
       
 
  By   /s/ Jerry Zinkula          
 
      Name: Jerry Zinkula
 
            Authorized Signatories

[Omnibus Amendment—Reliance Steel & Aluminum Co.]

-7-

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              American Investors Life Insurance Company
 
      (as Noteholder under the 1998 Note
 
      Purchase Agreement and the 2003 Note
Purchase Agreement)

         
 
  By:   AmerUs Capital Management Group, Inc.,
 
      its authorized attorney in fact
 
       
 
  By   /s/ [ILLEGIBLE]          
 
      Its VP – Private Placements

              AmerUs Life Insurance Company (as
 
      Noteholder under the 2003 Note Purchase
Agreement)

         
 
  By   /s/ [ILLEGIBLE]          
 
      Its VP - Private Placements

[Omnibus Amendment—Reliance Steel & Aluminum Co.]

-8-

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              American United Life Insurance Company
 
      (as Noteholder under the 1998 Note
Purchase Agreement)
 
       
 
  By   /s/ Michael Bullock          
 
      Name: Michael Bullock
 
      Its: Vice President Private Placements

[Omnibus Amendment—Reliance Steel & Aluminum Co.]

-9-

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              Berkshire Life Insurance Company of America
 
      (as Noteholder under the 1998 Note
Purchase Agreement)
 
       
 
  By   /s/ [ILLEGIBLE]          
 
      Its Director, Fixed Income
 
            The Guardian Insurance & Annuity Company,
 
      Inc. (as Noteholder under the 2003 Note
Purchase Agreement)
 
       
 
  By   /s/ [ILLEGIBLE]          
 
      Its Director, Fixed Income
 
            The Guardian Insurance Company of America
 
      (as Noteholder under the 2003 Note
Purchase Agreement)
 
       
 
  By   /s/ [ILLEGIBLE]          
 
      Its Director, Fixed Income
 
            Fort Dearborn Life Insurance Company (as
 
      Noteholder under the 2003 Note Purchase
Agreement)
 
       
 
  By:   Guardian Investor Services L.L.C.
 
       
 
  By   /s/ [ILLEGIBLE]          
 
      Its Director, Fixed Income

[Omnibus Amendment—Reliance Steel & Aluminum Co.]

-10-

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              Connecticut General Life Insurance
 
      Company (as Noteholder under the 1998 Note
 
      Purchase Agreement)
 
       
 
  By:   Cigna Investments Inc.
 
       
 
  By   /s/ Deborah B. Wiacek          
 
      Name: Deborah B. Wiacek
 
      Title: Managing Director

[Omnibus Amendment—Reliance Steel & Aluminum Co.]

-11-

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              Life Insurance Company of North America
 
      (as Noteholder under the 1998 Note
 
      Purchase Agreement)
 
       
 
  By   /s/ Deborah B. Wiacek          
 
      Name: Deborah B. Wiacek
 
      Title: Managing Director

[Omnibus Amendment—Reliance Steel & Aluminum Co.]

-12-

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              CUNA Mutual Insurance Society (as
 
      Noteholder under the 1997 Note Purchase
Agreement)
 
       
 
  By:   Members Capital Advisors, Inc.
 
      Its Investment Advisor
 
       
 
  By   /s/ [ILLEGIBLE]          
 
      Its Investment Analyst
 
       
 
  CUNA   Mutual Life Insurance Company (as
 
      Noteholder under the 1996 Note Purchase
 
      Agreement and the 1997 Note Purchase Agreement)
 
       
 
  By:   Members Capital Advisors, Inc.
 
      Its Investment Advisor
 
       
 
  By   /s/ [ILLEGIBLE]          
 
      Its Investment Analyst

[Omnibus Amendment—Reliance Steel & Aluminum Co.]

-13-

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                  John Hancock Insurance Company (as    
 
      Noteholder under the 1998 Note Purchase    
 
      Agreement and the 2003 Note Purchase    
 
      Agreement) formerly John Hancock Mutual    
 
      Life Insurance Company    
 
           
 
  By   /s/ Stacey P. Agretelis    
 
           
 
      Name: Stacey P. Agretelis    
 
      Title: Director    
 
                John Hancock Life Insurance Company (as    
 
      Noteholder under the 1998 Note Purchase    
 
      Agreement and the 2003 Note Purchase    
 
      Agreement)    
 
           
 
  By   /s/ Stacey P. Agretelis    
 
           
 
      Name: Stacey P. Agretelis    
 
      Title: Authorized Signatory    
 
                Signature 7 L.P. (as Noteholder under the 2003    
 
      Note Purchase Agreement)    
 
           
 
  By   John Hancock Life Insurance Company, as    
 
      Portfolio Advisor    
 
           
 
  By   /s/ Stacey P. Agretelis    
 
           
 
      Name: Stacey P. Agretelis    
 
      Title: Director    

[Omnibus Amendment—Reliance Steel & Aluminum Co.]

-14-

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                  Great-West Life & Annuity Insurance    
 
      Company (as Noteholder under the 1997    
 
      Note Purchase Agreement)    
 
           
 
  By   /s/ Eve Hampton    
 
           
 
      Name: Eve Hampton    
 
      Title: Vice President, Investments    
 
           
 
  By   /s/ J. G. Lowery    
 
           
 
      Name: J. G. Lowery    
 
      Title: Assistant Vice President, Investments    

[Omnibus Amendment—Reliance Steel & Aluminum Co.]

-15-

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                  Hartford Life Insurance Company (as    
 
      Noteholder under the 1998 Note Purchase    
 
      Agreement and the 2003 Note Purchase    
 
      Agreement)    
 
           
 
  By:   Hartford Investment Services, Inc.    
 
      as Agent and Attorney-in-Fact    
 
           
 
  By:   /s/ Eva Konopka    
 
           
 
      Name: Eva Konopka    
 
      Title: Senior Vice President    

 

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                  Nationwide Life Insurance Company (as    
 
      Noteholder under the 1996 Note Purchase    
 
      Agreement)    
 
           
 
  BY   /s/ Mark W. Poeppelman    
 
           
 
      Its MARK W. POEPPELMAN    
 
         AUTHORIZED SIGNATORY    

 

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                  THE NORTHWESTERN MUTUAL LIFE    
 
      INSURANCE COMPANY (as Noteholder    
 
      under the 1998 Note Purchase Agreement)    
 
           
 
  By   /s/ David A. Barras    
 
           
 
      Name: David A. Barras    
 
      Title: Its Authorized Representative    

 

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                  REASSURE AMERICA LIFE INSURANCE    
 
      COMPANY    
 
           
 
  By:   Swiss Re Asset Management (Americas)    
 
      Inc.    
 
           
 
  By   /s/ John H. DeMallie    
 
           
 
      Name: John H. DeMallie    
 
      Title: Vice President    

 

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                  MetLife Investors USA Insurance    
 
      Company (formerly known as Security First    
 
      Life Insurance Company) (as Noteholder    
 
      under the 1996 Note Purchase Agreement)    
 
           
 
  By:   Metropolitan Life Insurance Company,    
 
      as Investment Advisor    
 
           
 
  BY   /s/ [ILLEGIBLE]    
 
           
 
      Its Director    

 

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                  Teachers Insurance and Annuity    
 
      Association of America (as Noteholder    
 
      under the 1998 Note Purchase Agreement    
 
      and the 2003 Note Purchase Agreement)    
 
           
 
  By   /s/ Marina Mavrakis    
 
           
 
      Its MARINA MAVRAKIS    
 
           MANAGING DIRECTOR    

 

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                  Transamerica Occidental Life Insurance    
 
      Company (as Noteholder under the 1996    
 
      Note Purchase Agreement and the 1997 Note    
 
      Purchase Agreement)    
 
           
 
  By   /s/ [ILLEGIBLE]    
 
           
 
      Its Vice President    

 

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                  The Union Central Life Insurance    
 
      Company         (as Noteholder under the 1998 Note Purchase    
 
      Agreement)    
 
           
 
  By   /s/ [ILLEGIBLE]    
 
           
 
      Its Managing Director, Fixed Income    

 

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                  United of Omaha Life Insurance Company         (as Noteholder
under the 1996 Note Purchase    
 
      Agreement and the 1997 Note Purchase    
 
      Agreement)    
 
           
 
  By   /s/ [ILLEGIBLE]    
 
           
 
      Its Vice President    

 

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Consent to Omnibus Amendment

     The undersigned hereby acknowledges receipt of a counterpart original of,
and consents to, the foregoing Omnibus Amendment dated as of June 13, 2005.

     The undersigned hereby ratifies and confirms in all respects its
obligations under its Subsidiary Guaranty in favor of the holders of the Notes.

     This Consent to Omnibus Amendment is furnished for good and valuable
consideration the receipt and sufficiency of which are hereby acknowledged by
the undersigned, and the undersigned understands and intends that the
Noteholders will rely on the foregoing and that the undersigned will be legally
bound by the foregoing. This Consent to Omnibus Amendment shall inure to the
benefit of the Noteholders and their respective successors and assigns.

     In Witness Whereof, the undersigned has executed and delivered this Consent
to Omnibus Amendment as of June 13, 2005, pursuant to proper authority duly
granted.

              Subsidiary Guarantors:
 
            ALLEGHENY STEEL DISTRIBUTORS, INC.     ALUMINUM AND STAINLESS, INC.
    CCC STEEL, INC.     CHATHAM STEEL CORPORATION     DURRETT SHEPPARD STEEL
CO., INC.     PACIFIC METAL COMPANY     PDM STEEL SERVICE CENTERS, INC.    
PHOENIX CORPORATION     TOMA METALS, INC.     VALEX CORP.     VIKING MATERIALS,
INC.
 
       
 
  By:   /s/ Karla Lewis
 
       
 
  Name:   Karla Lewis
 
  Title:   Vice President and Secretary of each of the
foregoing
 
            PRECISION STRIP, INC.     SISKIN STEEL & SUPPLY COMPANY, INC.
 
       
 
  By:   /s/ Karla Lewis
 
       
 
  Name:   Karla Lewis
 
  Title:   Vice President and Assistant Secretary of
each of the foregoing

 

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              LUSK METALS     SERVICE STEEL AEROSPACE CORP
 
       
 
  By:   /s/ Karla Lewis
 
       
 
  Name:   Karla Lewis
 
  Title:   Chief Financial Officer and Secretary of
each of the foregoing
 
            AMERICAN METALS CORPORATION
 
       
 
  By:   /s/ Karla Lewis
 
       
 
  Name:   Karla Lewis
 
  Title:   Vice President, Chief Financial Officer and
Assistant Secretary of the foregoing
 
            AMERICAN STEEL, L.L.C.
 
       
 
  By:   /s/ Karla Lewis
 
       
 
  Name:   Karla Lewis
 
  Title:   Chief Financial Officer, Treasurer and
Assistant Secretary of the foregoing
 
            AMI METALS, INC.
 
       
 
  By:   /s/ Karla Lewis
 
       
 
  Name:   Karla Lewis
 
  Title:   Vice President, Chief Financial Officer and
Secretary of the foregoing
 
            CENTRAL PLAINS STEEL CO.
 
       
 
  By:   /s/ Karla Lewis
 
       
 
  Name:   Karla Lewis
 
  Title:   Vice President, Treasurer and Secretary of
the foregoing

 

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              LIEBOVICH BROS., INC.
 
       
 
  By:   /s/ Karla Lewis
 
       
 
  Name:   Karla Lewis
 
  Title:   Vice President, Assistant Treasurer and
Assistant Secretary of the foregoing

 

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Schedule A

Outstanding Agreements and Outstanding Notes

1.   The Note Purchase Agreement dated November 1,1996 among the Company and
each of the institutional investors listed therein, as amended by that certain
First Amendment dated September 15, 1997 and that certain Amendment No. 2 to
Note Purchase Agreements dated as of July 1, 2003 (as amended, the “1996 Note
Purchase Agreement”) pursuant to which the Company issued its 7.08% Senior
Notes, Series A, due January 2, 2004, its 7.21% Senior Notes, Series B, due
January 2, 2005, its 7.31% Senior Notes, Series C, due January 2, 2007 and its
7.37% Senior Notes, Series D, due January 2, 2009.

                                      Principal Amount of     Noteholder    
Series     Outstanding Notes    
AEGON USA Investment Management, Inc. (Transamerica Life)
    C     $ 8,000,000      
CUNA Mutual Life Insurance Company
    C     $ 3,000,000      
MetLife Insurance Company
    C     $ 2,000,000      
Nationwide Life Insurance Company
    C     $ 4,000,000      
United of Omaha Life Insurance Company
    C     $ 3,000,000      
Massachusetts Mutual Life Insurance Company
    D     $ 7,000,000      
Massachusetts Mutual Life Insurance Company
    D     $ 3,000,000      

2.   The Note Purchase Agreement dated September 15, 1997 among the Company and
each of the institutional investors listed therein, as amended by that certain
Amendment No. 1 to Note Purchase Agreements dated as of July 1, 2003 (as
amended, the “1997 Note Purchase Agreement”) pursuant to which the Company
issued its 6.76% Senior Notes, Series E, due January 2, 2002, its 7.04% Senior
Notes, Series F, due January 2, 2006 and its 7.08% Senior Notes, Series G, due
January 2, 2008.

                                      Principal Amount of     Noteholder    
Series     Outstanding Notes    
AEGON USA Investment Management, Inc. (Transamerica Life)
    F     $ 10,000,000      
CUNA Mutual Life Insurance Company
    F     $ 3,000,000      
CUNA Mutual Life Insurance Company
    F     $ 2,000,000      
Great-West Life & Annuity Insurance Company
    F     $ 5,000,000      

Schedule A
(to Omnibus Amendment)

 

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                                      Principal Amount of     Noteholder    
Series     Outstanding Notes    
United of Omaha Life Insurance Company
    F     $ 5,000,000      
Allstate Investments, LLC
    G     $ 15,000,000      
Massachusetts Mutual Life Insurance Company
    G     $ 15,000,000      

3.   The Note Purchase Agreement dated October 15, 1998 among the Company and
each of the institutional investors listed therein, as amended by that certain
Amendment No. 1 to Note Purchase Agreements dated as of July 1, 2003 (as
amended, the “1998 Note Purchase Agreement”) pursuant to which the Company
issued its 6.23% Senior Notes, Series H, due October 15, 2005, 6.37% Senior
Notes, Series I, due October 15, 2006, 6.52% Senior Notes, Series J, due
October 15, 2008 and 6.70% Senior Notes, Series K, due October 15, 2010.

                                      Principal Amount of     Noteholder    
Series     Outstanding Notes    
American United Life Insurance Company
    H     $ 5,000,000      
Swiss Reinsurance
    H     $ 5,000,000      
Prudential Financial
    H     $ 13,000,000      
American Investors Life Insurance Company
    I     $ 7,000,000      
CIG & Company as nominee for Life Insurance Company of North America
    I     $ 3,000,000      
Connecticut General Life Insurance Company
    I     $ 6,000,000      
[ACE]
    I     $ 3,000,000      
The Union Central Life Insurance Company
    I     $ 5,000,000      
Teachers Insurance and Annuity Association
    J     $ 5,000,000      
[Teachers Insurance and Annuity Association]
    J     [[$ 5,000,000 ]    
[Teachers Insurance and Annuity Association]
    J     [$ 5,000,000 ]    
[Allstate Life Insurance]
    J     [$ 10,000,000 ]    
Hartford Life Insurance Company
    J     $ 5,000,000      
Hartford Life Insurance Company
    J     $ 5,000,000      
Berkshire Life Insurance Company of America
    K     $ 3,000,000      
John Hancock Mutual Life Insurance Company
    K     $ 2,000,000      
John Hancock Mutual Life Insurance Company
    K     $ 500,000      
John Hancock Mutual Life Insurance Company
    K     $ 10,500,000      

A-2

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

 

                                      Principal Amount of     Noteholder    
Series     Outstanding Notes    
John Hancock Mutual Life Insurance Company
    K     $ 5,000,000      
John Hancock Mutual Life Insurance Company
    K     $ 12,500,000      
John Hancock Variable Life Insurance Company
    K     $ 1,500,000      
John Hancock Mutual Life Insurance Company
    K     $ 3,000,000      
Massachusetts Mutual Life Insurance Company
    K     $ 8,600,000      
Massachusetts Mutual Life Insurance Company
    K     $ 1,400,000      
Northwestern Mutual Life Insurance Company
    K     $ 30,000,000      

4.   The Note Purchase Agreement dated July 1, 2003 among the Company and each
of the institutional investors listed therein (the “2003 Note Purchase
Agreement”) pursuant to which the Company issued its 4.87% Senior Secured Notes,
Series L, due July 1, 2011 and 5.35% Senior Secured Notes, Series M, due July 1,
2013.

                                      Principal Amount of     Noteholder    
Series     Outstanding Notes    
Teachers Insurance and Annuity Association of America
    L     $ 30,000,000      
John Hancock Variable Life Insurance Company
    L     $ 5,000,000      
John Hancock Life Insurance Company
    L     $ 3,000,000      
Fort Dearborn Life Insurance Company
    L     $ 2,500,000      
The Guardian Insurance & Annuity Company, Inc.
    L     $ 2,500,000      
Hartford Life Insurance Company
    L     $ 5,000,000      
Allstate Investments, LLC
    L     $ 3,000,000      
Allstate Investments, LLC
    L     $ 6,000,000      
Allstate Investments, LLC
    L     $ 3,000,000      
Teachers Insurance and Annuity Association of America
    M     $ 30,000,000      
John Hancock Variable Life Insurance Company
    M     $ 10,000,000      
John Hancock Life Insurance Company
    M     $ 7,000,000      
The Guardian Life Insurance Company of America
    M     $ 5,000,000      
The Guardian Life Insurance Company of America
    M     $ 5,000,000      

A-3

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

 

                                      Principal Amount of     Noteholder    
Series     Outstanding Notes    
The Guardian Life Insurance Company of America
    M     $ 2,000,000      
Hartford Life Insurance Company
    M     $ 10,000,000      
AmerUS Life Insurance Company (AmerUS Capital Management)
    M     $ 3,000,000      
American Investors Life Insurance Company
    M     $ 1,000,000      
Signature & L.P.
    M     $ 2,000,000      

A-4

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

 

Exhibit A

Disclosure Materials

     The information included in the Memorandum is as of the date of the
Memorandum; provided that the information regarding Precision Strip, Inc.
included in the Memorandum was provided by the sellers of Precision Strip, Inc.
The Company has not verified each of the statements, and, accordingly, cannot
represent that the statements do not contain any untrue statement of a material
fact or omit to state any material facts necessary to make the statements
therein not misleading. The Company does not, however, know of any untrue
statement of a material fact or any omission of any material fact necessary to
make the statements therein not misleading. The Company is not obligated to
correct the Memorandum if it discovers any such facts. As of July 1, 2003,
Precision Strip, Inc. has become a Restricted Subsidiary and a guarantor of the
Notes under the Master Subsidiary Guaranty. From time to time the Company
considers other potential acquisitions that could result in a change in the
Company’s operations, but no such change known to the Company could reasonably
be expected to have a Material Adverse Effect.

     The Company’s financial condition, operations, business, properties and
prospects have changed as set forth in the financial statements and reports
listed on Schedule 5.5.

Schedule 5.3
(to Note Purchase Agreement)

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

 

Names and Ownership of
Subsidiaries of the Company

                      Name of Subsidiary 1   Class of Capital Stock   Percentage
    and Jurisdiction of Incorporation       Owned by the             Company 2
3
  Allegheny Steel Distributors, Inc., a Pennsylvania corporation   Common Stock
    100 %
 
               
3
  Aluminum and Stainless, Inc., a Louisiana corporation   Common Stock     100 %
 
               
3
  American Metals Corporation, a California corporation   Common Stock     100 %
 
               
3
  AMI Metals, Inc. a Tennessee corporation   Common Stock     100 %
 
               
3
  CCC Steel, Inc., a Delaware corporation   Common Stock     100 %
 
               
3
  Central Plains Steel Co., a Kansas corporation   Common Stock     100 %
 
               
3
  Chatham Steel Corporation, a Georgia corporation   Common Stock     100 %
 
               
3
  Durrett Sheppard Steel Co., Inc., a California corporation   Common Stock    
100 %
 
               
3
  Liebovich Bros., Inc., an Illinois corporation   Common Stock     100 %
 
               
3
  Lusk Metals, a California corporation   Common Stock     100 %
 
               
3
  Pacific Metal Company, an Oregon corporation   Common Stock     100 %
 
               
3
  PDM Steel Service Centers, Inc., a California corporation   Common Stock    
100 %
 
               
3
  Phoenix Corporation, a Georgia corporation   Common Stock     100 %
 
               
3
  Precision Strip, Inc., an Ohio corporation   Common Stock     100 %
 
               
3
  RSAC Management Corp., a California corporation   Common Stock     100 %4

 

1   The Company has listed only first-tier Subsidiaries of RSAC Management Corp.
From time to time such Subsidiaries may own all of the outstanding common stock
of second-tier Subsidiaries. The Company has owned certain shell corporations
for the purpose of protecting the names “Reliance Steel Company” in Nevada;
“Reliance Metalcenters” in Arizona, and Texas; and “Tube Service Co.,” in
California.   2   The shares of all of the subsidiaries listed below (other than
RSAC Management Corp.) are owned by RSAC Management Corp., which is a
wholly-owned subsidiary of the Company.   3   The above designated Subsidiaries
are Restricted Subsidiaries as defined in the Note Purchase Agreement.   4  
RSAC Management Corp. provides certain administrative and financial services to
the subsidiaries, but is not a metals service center.

Schedule 5.4
(to Note Purchase Agreement)

 

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

 

                      Name of Subsidiary 1   Class of Capital Stock        
Percentage     and Jurisdiction of Incorporation       Owned by the            
Company 2
3
  Service Steel Aerospace Corp., a Delaware corporation   Common Stock     100 %
 
               
3
  Siskin Steel & Supply Company, Inc., a Tennessee corporation   Voting Common
Stock     100 %
 
      Non-voting Common Stock     100 %
 
               
3
  Toma Metals, Inc., a Pennsylvania corporation   Common Stock     100 %
 
               
3
  Valex Corp., a California corporation   Common Stock     97.4 %
 
               
3
  Viking Materials, Inc., a Minnesota corporation   Voting Common Stock
Non-voting Common Stock     100
100 %
%

                              Percentage     Name of Affiliate       Owned by  
  and Jurisdiction of Incorporation       Equity Interest   the Company
3
  American Steel, LLC, an Oregon limited liability company   Membership
Interests     50.5 %

Restrictions

     The Restricted Subsidiaries of the Company are guarantors of the Credit
Agreement, which is the Company’s primary credit facility with Bank of America,
National Association, as Administrative Agent and Lender, and the Lenders listed
in the Credit Agreement from time to time, and, accordingly, are subject to
certain restrictions, none of which would prohibit any such Restricted
Subsidiary from paying dividends to the Company out of profits or making any
other similar distributions of profits to the Company.

     When the Company merged MetalCenter, Inc. with and into the Company, the
Company became obligated on those Variable Rate Demand Industrial Development
Revenue Bonds, Series 1989 A, issued by MetalCenter, Inc., in favor of
Industrial Development Authority of the City of Santa Fe Springs, a public,
corporate instrumentality of the state of California, due July 1, 2014, with a
principal balance of $2.75 million as of December 31, 2002, and $2.45 million as
of December 31, 2004, which are secured by a letter of credit issued by Bank of
America, National Association, which contain certain restrictions but do not
prohibit the Company from paying dividends out of profits or making any other
similar distributions from profits.

     When the Company acquired Viking Materials, Inc., Viking Materials, Inc.
was obligated on those Variable Rate Demand Industrial Development Revenue
Bonds, Series 1999, issued by Viking Materials, Inc., in favor of the City of
Minneapolis, a public, corporate

 5.4-2

 

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

 

instrumentality in the state of Minnesota, due March 1, 2009, with a principal
balance of $2.25 million as of December 31, 2002, and $1.8 million as of
December 31, 2004, which are secured by a letter of credit issued by Bank of
America, National Association, which contain certain restrictions but do not
prohibit Viking Materials, Inc. from paying dividends out of profits or making
any other similar distributions from profits to the Company. When the Company
acquired an additional membership unit of American Steel, L.L.C. effective
May 1, 2002, the Company began consolidating the financial results of American
Steel, L.L.C.

Officers and Directors of the Company

Officers

      Name        Position
David H. Hannah
  Chief Executive Officer
Gregg J. Mollins
  President and Chief Operating Officer
Karla R. Lewis
  Executive Vice President and Chief Financial Officer
James P. MacBeth
  Senior Vice President, Carbon Steel Operations
William K. Sales, Jr.
  Senior Vice President, Non-Ferrous Operations
Donna Newton
  Vice President, Human Resources
Kay Rustand
  Vice President and General Counsel
Yvette M. Schiotis
  Secretary

Directors
Joe D. Crider
Thomas W. Gimbel
Douglas M. Hayes

David H. Hannah
Franklin R. Johnson
Mark V. Kaminski

 5.4-3

 

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

 

Gregg J. Mollins

Leslie A. Waite

     The Company has received notice that Liebovich Bros., Inc. has had its
corporate status revoked for failure to file certain reports, and the Company is
taking corrective action.

 5.4-4

 

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

 

Financial Statements

     The Company has delivered to each Purchaser copies of the following
financial statements of the Company and its Restricted Subsidiaries:

(1)    Annual Reports on Form 10-K for the fiscal years ended December 31, 2001,
2002, 2003 and 2004;

(2)    Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31,
2002, 2003, 2004 and 2005; June 30, 2002, 2003 and 2004; and September 30, 2002,
2003 and 2004;

(3)    Proxy Statement for the Annual Meetings of Shareholders held May 21,
2003, May 19, 2004 and May 18, 2005; and

(4)    Prospectus dated June 28, 2001.

Although the Company included in the Memorandum certain information regarding
Precision Strip, Inc., the Company does not make any representations with
respect to such information. The Company provided information about Precision
Strip, Inc. that was provided to the Company by the sellers of Precision Strip,
Inc. and that the Company has not yet verified in its entirety. The Company has
not undertaken to update or correct any such information.

Schedule 5.5
(to Note Purchase Agreement)

 

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

 

Certain Litigation

     From time to time, the Company is a party to certain actions, suits or
proceedings in the ordinary course of its business, but the Company is not aware
of any such pending actions, suits or proceedings or threatened actions, suits
or proceedings that, individually or in the aggregate, could be expected to have
a Material Adverse Effect.

schedule 5.8
(to Note Purchase Agreement)

 

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

 

Patents, Etc.

     No exceptions.

 5.11

 

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

 

Use of Proceeds

     The Company used the proceeds from the sale of the Notes issued July 1,
2003 principally in connection with the acquisition of Precision Strip, Inc.,
either for payment of the purchase price, general corporate purposes, working
capital, or repayment of debt.

Schedule 5.14
(to Note Purchase Agreement)

 

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

 

Existing Debt

     The following is a complete and correct list of all outstanding Debt of the
Company and its Restricted Subsidiaries as of December 31, 2002:

     1. The Credit Agreement, which, as of December 31, 2002 consists of a
revolving credit facility with Bank of America, National Association, as
Administrative Agent and the Lenders listed therein, with maximum credit
available of $335 million and an outstanding balance as of December 31, 2002 of
$38 million, and $30 million as of December 31, 2004, which is guaranteed by the
Company’s Material Subsidiaries. At December 31, 2002, the Company also had
$10,900,000 of letters of credit outstanding and $39,100,000 available, under
this syndicated credit facility. At December 31, 2004, the Company had
$15,907,000 of letters of credit outstanding and $34,093,000 available, under
this syndicated credit facility. The holders were granted a security interest
and a Lien under the Security Agreement that was a first priority pari passu
Lien, but that was automatically released in 2005.

     2. Variable Rate Demand Industrial Development Revenue Bonds, Series 1989
A, issued by MetalCenter, Inc. in favor of Industrial Development Authority of
the City of Santa Fe Springs, a public, corporate instrumentality of the State
of California due July 1, 2014, with a principal balance of $2.75 million as of
December 31, 2002, which balance was reduced to $2.45 million as of December 31,
2004, and which bonds are secured by a letter of credit issued by Bank of
America, National Association.

     3. Senior unsecured notes dated November 1, 1996, as amended, and
September 16, 1997, as amended, in the aggregate principal amount of
$130 million in favor of certain institutional investors, which are guaranteed
by the Company’s Material Subsidiaries. The holders are or will be granted a
security interest and a Lien under the Security Agreement that will be a first
priority pari passu Lien. The aggregate principal balance as of December 31,
2004 was $108 million.

     4. Senior unsecured notes dated October 15, 1998, as amended, in the
aggregate principal amount of $150 million in favor of certain institutional
investors, which are guaranteed by the Company’s Material Subsidiaries. The
holders are or will be granted a security interest and a Lien under the Security
Agreement that will be a first priority pari passu Lien. The aggregate principal
balance at December 31, 2004 was $150 million.

     5. Variable Rate Demand Industrial Development Revenue Bonds, Series 1999,
issued by Viking Materials, Inc. in favor of the City of Minneapolis, Minnesota,
due March 1, 2009, with a principal balance of $2.225 million as of December 31,
2002, which balance was reduced to $1.8 million as of December 31, 2004, and
which bonds are secured by a letter of credit issued by Bank of America,
National Association.

     6. Senior unsecured notes dated July 1, 2003 in the aggregate principal
amount of $135 million in favor of certain institutional investors, which are
guaranteed by the Company’s Material Subsidiaries. The holders were granted a
security interest and a Lien under the Security Agreement that was a first
priority pari passu Lien.

     The pari passu Lien described in item numbers 1, 3, 4, and 6 above was
terminated and the Collateral was released in or about April 2005.

     The outstanding balances on the credit facilities listed above may change
from time to time and the credit facilities may be amended, restated or replaced
with credit facilities having greater available credit.

Schedule 5.15
(to Note Purchase Agreement)