Exhibit 10.5

 

[EXECUTION COPY]

 

$315,000,000

 

NOVAMERICAN STEEL FINCO INC.

 

11.5% Senior Secured Notes due 2015

 

Purchase Agreement

 

November 14, 2007

 

J.P. Morgan Securities Inc.
  As Representative of the
  several Initial Purchasers listed
  in Schedule 1 hereto
c/o J.P. Morgan Securities Inc.
270 Park Avenue
New York, New York  10017

 

Ladies and Gentlemen:

 

Novamerican Steel Finco Inc., a Delaware corporation (the “Issuer”), proposes to
issue and sell to the several initial purchasers listed in Schedule 1 hereto
(the “Initial Purchasers”), for whom you are acting as representative (the
“Representative”), $315,000,000 principal amount of its 11.5% Senior Secured
Notes due 2015 (the “Securities”). The Securities will be issued pursuant to an
Indenture to be dated as of November 15, 2007 (the “Indenture”), among the
Issuer, the guarantors listed in Schedule 2 hereto (the “Guarantors”) and The
Bank of New York, as trustee (in such capacity, the “Trustee”), and will be
guaranteed on a senior secured basis by each of the Guarantors (the
“Guarantees”).

 

The Securities will be sold to the Initial Purchasers without being registered
under the Securities Act of 1933, as amended (the “Securities Act”), in reliance
upon an exemption therefrom and without the filing of a prospectus with any
Canadian Securities Commission or similar regulator authority under the
securities laws, rules, regulations and written policy statements of any
province in Canada (collectively, the “Canadian Securities Laws”), in reliance
on exemptions from the prospectus requirements of the applicable Canadian
Securities Laws. The Issuer has prepared a preliminary offering memorandum dated
October 29, 2007 (the “U.S. Preliminary Offering Memorandum”) and a Canadian
preliminary offering memorandum of the same date (the “Canadian Preliminary
Offering Memorandum” and, together with the U.S. Preliminary Offering
Memorandum, the “Preliminary Offering Memorandum”) and will prepare an offering
memorandum dated the date hereof (the “U.S. Offering Memorandum”) and a Canadian
offering memorandum of the same date (the “Canadian Offering Memorandum” and,
together with the U.S. Offering Memorandum, the “Offering Memorandum”) setting
forth information concerning the Issuer and the Securities. Copies of the
Preliminary Offering

 

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Memorandum have been, and copies of the Offering Memorandum will be, delivered
by the Issuer to the Initial Purchasers pursuant to the terms of this Agreement.
The Issuer hereby confirms that it has authorized the use of the Preliminary
Offering Memorandum, the other Time of Sale Information (as defined below) and
the Offering Memorandum in connection with the offering and resale of the
Securities by the Initial Purchasers in the manner contemplated by this
Agreement.

 

At or prior to the time when sales of the Securities were first made (the “Time
of Sale”), the following information shall have been prepared (collectively, the
“Time of Sale Information”):  the Preliminary Offering Memorandum, as
supplemented and amended by the written communications listed on Annex A hereto.

 

The Issuer is a direct wholly-owned subsidiary of Novamerican Steel Holdings
Inc., a Delaware corporation (“Holdings”), which is a direct wholly-owned
subsidiary of Symmetry Holdings Inc., a Delaware corporation and a public
company (“Symmetry”). 632421 N.B. Ltd., a New Brunswick corporation (“Can Sub
1”), is a direct wholly-owned subsidiary of the Issuer. Can Sub 1 will continue
as a Canada Business Corporations Act (“CBCA”) corporation as part of the
Transactions (as defined below). 632422 N.B. Ltd., a New Brunswick corporation
(“Can Sub 2”), is a direct wholly-owned subsidiary of Can Sub 1 and is called
“Acquisitionco” in the Preliminary Offering Memorandum, the Time of Sale
Information and the Offering Memorandum as well as in the Arrangement Agreement
(as defined below).

 

On or prior to the Closing Date (as defined below), the Issuer, the Guarantors
and their respective subsidiaries will complete a series of transactions
described under the heading “Summary ―The Transactions” in the Preliminary
Offering Memorandum (such transactions, the “Transactions”) such that, upon
completion thereof, Novamerican Steel Inc., a Canadian corporation (“NSI”), will
be acquired by the Issuer.

 

As part of the Transactions, (i) on or prior to November 13, 2007, each of
156499 Canada Inc., 165948 Canada Inc. and Mc Kendwell Investments Inc, in each
case a Canadian corporation, will reduce its stated capital account to Cdn.$1.00
and immediately thereafter liquidate and wind-up and commence dissolution,
(ii) Acier Metco Inc., a Quebec company, will liquidate and wind-up into Nova
Steel Ltd., a Canadian corporation, (iii) pursuant to the terms of the
Arrangement Agreement dated as of June 21, 2007 (the “Arrangement Agreement”),
by and among Symmetry, Can Sub 2 and NSI, Can Sub 2 will acquire all of the
outstanding common shares of NSI by way of a court-approved statutory plan of
arrangement (the “Plan of Arrangement”) under the CBCA (the “Acquisition”),
(iv) Can Sub 2 will transfer all of the outstanding common shares of NSI so
acquired to Can Sub 1, (v) Can Sub 1 and NSI will be amalgamated under the CBCA
to form Novamerican Steel Inc., a Canadian corporation (“Amalco 1”), (vi) Amalco
1 will transfer the U.S. Subsidiary Indebtedness (as such term is defined in the
Arrangement Agreement) and all of the outstanding shares of Integrated Steel
Industries Inc., a Delaware corporation (“ISI”) and, immediately prior to such
transfer, the direct or indirect parent of all other U.S. subsidiaries of NSI,
to the Issuer, (vii) Nova Tube Inc. and Argo Steel Ltd., each of which is a
Québec company, will reduce its stated capital account to Cdn.$1.00 and
immediately thereafter liquidate and wind-up into Amalco 2 and (viii) Amalco 1,
Nova Steel Ltd., Cresswell Industries Inc., Nova Steel Processing Centre Ltd.
and Nova Tube Ontario Inc., each of which is a Canadian corporation, will reduce
its stated capital to Cdn.$1.00

 

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and immediately thereafter amalgamate under the CBCA to form Novamerican Steel
Inc., a Canadian corporation (“Novamerican Steel”). In addition, (i) Chriscorp
ULC, a Nova Scotia unlimited liability company and previously an indirect
wholly-owned subsidiary of NSI, was liquidated on October 31, 2007, (ii) Annaco
General Partnerhsip, a Delaware general partnership, was liquidated on
October 31, 2007, (iii) Hencorp LLC, a Delaware limited liability company and
previously an indirectly wholly-owned subsidiary of NSI, will be liquidated as
soon as practicable after the Closing Date and (iv) certain transitory holding
companies will be formed and subsequently amalgamated with other companies
described above.

 

Further, as part of the Transactions, (i) Symmetry, the Issuer and Can Sub 1
(the obligations of which will be assumed by operation of law by Novamerican
Steel on the Closing Date) will enter into the Credit Agreement to be dated as
of the Closing Date (the “Credit Agreement” and, together with the security
documents related thereto, the “Credit Documents”), among Symmetry, the Issuer,
Novamerican Steel, the lenders party thereto, the issuing banks party thereto,
CIT Business Credit Canada Inc., as syndication agent, JPMorgan Chase Bank,
N.A., as administrative agent (the “Administrative Agent”), and JPMorgan Chase
Bank, N.A., Toronto Branch, as Canadian agent, pursuant to which the Issuer will
be able to borrow up to $175,000,000 in senior secured revolving loans (of which
Novamerican Steel will be able to borrow up to $125,000,000), (ii) the Issuer,
the Guarantors and the Trustee will enter into the Indenture, (iii) the Issuer
will issue the Securities pursuant to the Indenture, (iv) the Issuer and the
Guarantors will enter into the Collateral Agreement to be dated as of the
Closing Date (the “Collateral Agreement”), among the Issuer, the Guarantors and
The Bank of New York, as collateral agent (in such capacity, the “U.S.
Collateral Agent”), (v) the Issuer or the applicable Guarantor will enter into a
mortgage or deed of trust (such mortgages and deeds of trust, the “Mortgages”
and, together with the Collateral Agreement, the “Security Agreements”) in favor
of the U.S. Collateral Agent, for the benefit of the Secured Parties, with
respect to each of the properties listed on Schedule 3(a) hereto (collectively,
the “Mortgaged Properties”), (vi) Can Sub 1 (the obligations of which will be
assumed by operation of law by Novamerican Steel on the Closing Date) will issue
two intercompany demand promissory notes (the “Intercompany Note”) to the Issuer
in exchange for $125,000,000 in cash, (vii) Novamerican Steel will secure its
obligations under the Intercompany Note pursuant to (a) the Canadian Collateral
Agreement to be dated as of the Closing Date (the “Canadian Collateral
Agreement”), among Novamerican Steel, the Issuer and BNY Trust Company of
Canada, as collateral agent (the “Canadian Collateral Agent” and, together with
the U.S. Collateral Agent, the “Collateral Agents”), and (b) a Quebec deed of
hypothec, charging all of Novamerican Steel’s real (immovable) properties listed
on Schedule 3(c) hereto located in the Province of Quebec and all of its
personal (movable) property, to be dated as of the Closing Date (the “Quebec
Hypothec”), among Novamerican Steel and the Canadian Collateral Agent, as fondé
de pouvoir, for the benefit of the Issuer and its successors and assigns; and
(c) a debenture granted by Novamerican Steel in favour of the Canadian
Collateral Agent, for the benefit of the Issuer and its successors and assigns
(the “Ontario Mortgage” and, together with the Canadian Collateral Agreement and
the Quebec Hypothec, the “Canadian Security Agreements”; the Ontario Mortgage
and the hypothec created under the Quebec Hypothec on the property listed on
Schedule 3(c) hereto located in the Province of Quebec are collectively referred
to as the “Canadian Mortgages”) with respect to the property listed on
Schedule 3(c) hereto located in the Province of Ontario (this property, together
with the property listed on Schedule 3(c) hereto located in the Province of
Quebec, collectively, the “Canadian Mortgaged Properties”), (viii) the Issuer,
Novamerican Steel and the Guarantors

 

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will enter into the Intercreditor Agreement to be dated as of the Closing Date
(the “Intercreditor Agreement”), among the Issuer, the Guarantors, Novamerican
Steel and certain other subsidiaries of Symmetry, the U.S. Collateral Agent and
the Administrative Agent and (ix) the obligations of the Issuer and the
Guarantors under the Securities and the Guarantees will be secured by a
first-priority security interest in the first-priority collateral (as described
in the Preliminary Offering Memorandum, the “First-Priority Collateral”),
including the Intercompany Note, and by a second-priority security interest in
the second-priority collateral (as described in the Preliminary Offering
Memorandum, the “Second-Priority Collateral” and, together with the
First-Priority Collateral, the “Collateral”), in each case in favor of the U.S.
Collateral Agent for the benefit of the Trustee, the U.S. Collateral Agent, each
holder of the Securities and their respective successors and assigns
(collectively, the “Secured Parties”), in each case subject only to liens and
encumbrances permitted by the Indenture and the Collateral Agreement.

 

The representations, warranties and agreements of Novamerican Steel and the
Guarantors listed on Schedule 4 hereto (together with Novamerican Steel,
collectively, the “Joining Parties”) under this Agreement shall not become
effective until the consummation of the Acquisition and execution by the Issuer,
Novamerican Steel and the Guarantors of a Joinder to Purchase Agreement, the
form of which is attached hereto as Exhibit B (the “Joinder Agreement”), at
which time such representations, warranties and agreements shall become
effective as of the date hereof pursuant to the terms of the Joinder Agreement
and each of the Joining Parties shall, without further action by any person,
become a party to this Agreement.

 

Holders of the Securities (including the Initial Purchasers and their direct and
indirect transferees) will be entitled to the benefits of a Registration Rights
Agreement to be dated the Closing Date and substantially in the form attached
hereto as Exhibit A (the “Registration Rights Agreement”), pursuant to which the
Issuer and the Guarantors will agree to file one or more registration statements
with the United States Securities and Exchange Commission (the “Commission”)
providing for the registration under the Securities Act of the Securities or the
Exchange Securities referred to (and as defined) in the Registration Rights
Agreement (the “Exchange Securities”).

 

This Agreement, the Indenture (including each Guarantee set forth therein), the
Securities, the Exchange Securities, the Joinder Agreement, the Security
Agreements, the Intercreditor Agreement and the Registration Rights Agreement
are collectively referred to herein as the “Note Documents”, and, together with
the Arrangement Agreement, the Intercompany Note, the Canadian Security
Agreements and the Credit Documents, are collectively referred to herein as the
“Transaction Documents”.

 

As used in this Agreement, the term “Post Transaction Subsidiaries” means the
subsidiaries of Symmetry after giving effect to the Transactions (including the
Issuer), which subsidiaries are listed on Schedule 5(c)(2) hereto.

 

The Issuer hereby confirms its agreement with the several Initial Purchasers
concerning the purchase and resale of the Securities, as follows:

 

1.                                       PURCHASE AND RESALE OF THE SECURITIES.
(A)  THE ISSUER AGREES TO ISSUE AND SELL THE SECURITIES TO THE SEVERAL INITIAL
PURCHASERS AS PROVIDED IN THIS AGREEMENT, AND EACH INITIAL

 

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PURCHASER, ON THE BASIS OF THE REPRESENTATIONS, WARRANTIES AND AGREEMENTS SET
FORTH HEREIN AND SUBJECT TO THE CONDITIONS SET FORTH HEREIN, AGREES, SEVERALLY
AND NOT JOINTLY, TO PURCHASE FROM THE ISSUER THE RESPECTIVE PRINCIPAL AMOUNT OF
SECURITIES SET FORTH OPPOSITE SUCH INITIAL PURCHASER’S NAME IN SCHEDULE 1 HERETO
AT A PRICE EQUAL TO 97.0% OF THE PRINCIPAL AMOUNT THEREOF PLUS ACCRUED INTEREST,
IF ANY, FROM NOVEMBER 15, 2007 TO THE CLOSING DATE. THE ISSUER WILL NOT BE
OBLIGATED TO DELIVER ANY OF THE SECURITIES EXCEPT UPON PAYMENT FOR ALL THE
SECURITIES TO BE PURCHASED AS PROVIDED HEREIN.

 

(B)                                 THE ISSUER UNDERSTANDS THAT THE INITIAL
PURCHASERS INTEND TO OFFER THE SECURITIES FOR RESALE ON THE TERMS SET FORTH IN
THE TIME OF SALE INFORMATION. EACH INITIAL PURCHASER, SEVERALLY AND NOT JOINTLY,
REPRESENTS, WARRANTS AND AGREES THAT:

 

(I)                                     IT IS A QUALIFIED INSTITUTIONAL BUYER
WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT (A “QIB”) AND AN
ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501(A) UNDER THE SECURITIES ACT;

 

(II)                                  IT HAS NOT SOLICITED OFFERS FOR, OR
OFFERED OR SOLD, AND WILL NOT SOLICIT OFFERS FOR, OR OFFER OR SELL, THE
SECURITIES BY MEANS OF ANY FORM OF GENERAL SOLICITATION OR GENERAL ADVERTISING
WITHIN THE MEANING OF RULE 502(C) OF REGULATION D UNDER THE SECURITIES ACT
(“REGULATION D”) OR IN ANY MANNER INVOLVING A PUBLIC OFFERING WITHIN THE MEANING
OF SECTION 4(2) OF THE SECURITIES ACT; AND

 

(III)                               IT HAS NOT SOLICITED OFFERS FOR, OR OFFERED
OR SOLD, AND WILL NOT SOLICIT OFFERS FOR, OR OFFER OR SELL, THE SECURITIES AS
PART OF THEIR INITIAL OFFERING EXCEPT:

 

(A)                              WITHIN THE UNITED STATES TO PERSONS WHOM IT
REASONABLY BELIEVES TO BE QIBS IN TRANSACTIONS PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT (“RULE 144A”) AND, IN CONNECTION WITH EACH SUCH SALE, IT HAS
TAKEN OR WILL TAKE REASONABLE STEPS TO ENSURE THAT THE PURCHASER OF THE
SECURITIES IS AWARE THAT SUCH SALE IS BEING MADE IN RELIANCE ON RULE 144A; OR

 

(B)                                IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH
IN ANNEX C HERETO.

 

(C)                                  EACH INITIAL PURCHASER COVENANTS THAT IT
WILL USE ITS REASONABLE BEST EFFORTS IN ORDER TO NOT SELL SECURITIES TO FMR
CORP. (WHICH CARRIES ON BUSINESS AS FIDELITY INVESTMENTS) OR ANY TRUST, FUND, OR
ENTITY THAT IS AFFILIATED WITH FMR CORP.

 

(D)                                 EACH INITIAL PURCHASER ACKNOWLEDGES AND
AGREES THAT THE ISSUER AND, FOR PURPOSES OF THE OPINIONS TO BE DELIVERED TO THE
INITIAL PURCHASERS PURSUANT TO SECTIONS 6(F) AND 6(G), COUNSEL FOR THE ISSUER
AND COUNSEL FOR THE INITIAL PURCHASERS, RESPECTIVELY, MAY RELY UPON THE ACCURACY
OF THE REPRESENTATIONS AND WARRANTIES OF THE INITIAL PURCHASERS, AND COMPLIANCE
BY THE INITIAL PURCHASERS WITH THEIR AGREEMENTS, CONTAINED IN PARAGRAPH
(B) ABOVE (INCLUDING ANNEX C HERETO), AND EACH INITIAL PURCHASER HEREBY CONSENTS
TO SUCH RELIANCE.

 

(E)                                  THE ISSUER ACKNOWLEDGES AND AGREES THAT THE
INITIAL PURCHASERS MAY OFFER AND SELL SECURITIES TO OR THROUGH ANY AFFILIATE OF
AN INITIAL PURCHASER AND THAT ANY SUCH AFFILIATE MAY OFFER AND SELL SECURITIES
PURCHASED BY IT TO OR THROUGH ANY INITIAL PURCHASER.

 

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(F)                                    EACH OF THE ISSUER, NOVAMERICAN STEEL AND
THE GUARANTORS ACKNOWLEDGE AND AGREE THAT THE INITIAL PURCHASERS ARE ACTING
SOLELY IN THE CAPACITY OF AN ARM’S LENGTH CONTRACTUAL COUNTERPARTY TO THE
ISSUER, NOVAMERICAN STEEL AND THE GUARANTORS WITH RESPECT TO THE OFFERING OF
SECURITIES CONTEMPLATED HEREBY (INCLUDING IN CONNECTION WITH DETERMINING THE
TERMS OF THE OFFERING) AND NOT AS FINANCIAL ADVISORS OR FIDUCIARIES TO, OR
AGENTS OF, THE ISSUER, NOVAMERICAN STEEL, NSI, THE GUARANTORS OR ANY OTHER
PERSON. ADDITIONALLY, NEITHER THE REPRESENTATIVE NOR ANY OTHER INITIAL PURCHASER
IS ADVISING THE ISSUER, NOVAMERICAN STEEL, NSI, THE GUARANTORS OR ANY OTHER
PERSON AS TO ANY LEGAL, TAX, INVESTMENT, ACCOUNTING OR REGULATORY MATTERS IN ANY
JURISDICTION. THE ISSUER, NOVAMERICAN STEEL, NSI AND THE GUARANTORS SHALL
CONSULT WITH THEIR OWN ADVISORS CONCERNING SUCH MATTERS AND SHALL BE RESPONSIBLE
FOR MAKING THEIR OWN INDEPENDENT INVESTIGATION AND APPRAISAL OF THE TRANSACTIONS
CONTEMPLATED HEREBY, AND NEITHER THE REPRESENTATIVE NOR ANY OTHER INITIAL
PURCHASER SHALL HAVE ANY RESPONSIBILITY OR LIABILITY TO THE ISSUER, NOVAMERICAN
STEEL, NSI OR THE GUARANTORS WITH RESPECT THERETO. ANY REVIEW BY THE
REPRESENTATIVE OR ANY INITIAL PURCHASER OF THE ISSUER, NOVAMERICAN STEEL, NSI,
THE GUARANTORS AND THE TRANSACTIONS CONTEMPLATED HEREBY, WITH RESPECT TO SUCH
TRANSACTIONS OR OTHER MATTERS RELATING TO SUCH TRANSACTIONS, WILL BE PERFORMED
SOLELY FOR THE BENEFIT OF THE REPRESENTATIVE OR SUCH INITIAL PURCHASER, AS THE
CASE MAY BE, AND SHALL NOT BE ON BEHALF OF THE ISSUER, NOVAMERICAN STEEL, NSI,
THE GUARANTORS OR ANY OTHER PERSON.

 

2.                                       PAYMENT AND DELIVERY. (A)  PAYMENT FOR
AND DELIVERY OF THE SECURITIES WILL BE MADE AT THE OFFICES OF CRAVATH, SWAINE &
MOORE LLP, 825 EIGHTH AVENUE, NEW YORK, NY 10019, AT 10:00 A.M., NEW YORK CITY
TIME, ON NOVEMBER 15, 2007, OR AT SUCH OTHER TIME OR PLACE ON THE SAME OR SUCH
OTHER DATE, NOT LATER THAN THE FIFTH BUSINESS DAY THEREAFTER, AS THE
REPRESENTATIVE AND THE ISSUER MAY AGREE UPON IN WRITING. THE TIME AND DATE OF
SUCH PAYMENT AND DELIVERY IS REFERRED TO HEREIN AS THE “CLOSING DATE”.

 

(B)                                 PAYMENT FOR THE SECURITIES SHALL BE MADE BY
WIRE TRANSFER IN IMMEDIATELY AVAILABLE FUNDS TO THE ACCOUNT(S) SPECIFIED BY THE
ISSUER TO THE REPRESENTATIVE AGAINST DELIVERY TO THE NOMINEE OF THE DEPOSITORY
TRUST COMPANY, FOR THE ACCOUNT OF THE INITIAL PURCHASERS, OF ONE OR MORE GLOBAL
NOTES REPRESENTING THE SECURITIES (COLLECTIVELY, THE “GLOBAL NOTE”), WITH ANY
TRANSFER TAXES PAYABLE IN CONNECTION WITH THE SALE OF THE SECURITIES DULY PAID
BY THE ISSUER. THE GLOBAL NOTE WILL BE MADE AVAILABLE FOR INSPECTION BY THE
REPRESENTATIVE NOT LATER THAN 9:00 A.M., NEW YORK CITY TIME, ON THE CLOSING
DATE.

 

3.                                       REPRESENTATIONS AND WARRANTIES OF THE
ISSUER, NOVAMERICAN STEEL AND THE GUARANTORS. THE ISSUER, NOVAMERICAN STEEL AND
THE GUARANTORS JOINTLY AND SEVERALLY REPRESENT AND WARRANT TO EACH INITIAL
PURCHASER AS OF THE DATE HEREOF  AND AS OF THE CLOSING DATE THAT:

 

(A)                                  PRELIMINARY OFFERING MEMORANDUM, TIME OF
SALE INFORMATION AND OFFERING MEMORANDUM. THE PRELIMINARY OFFERING MEMORANDUM,
AS OF ITS DATE, DID NOT, THE TIME OF SALE INFORMATION, AT THE TIME OF SALE, DID
NOT, AND, AT THE CLOSING DATE WILL NOT, AND THE OFFERING MEMORANDUM, AS OF THE
DATE HEREOF AND AS OF THE CLOSING DATE, WILL NOT, CONTAIN ANY UNTRUE STATEMENT
OF A MATERIAL FACT OR OMIT TO STATE A MATERIAL FACT NECESSARY IN ORDER TO MAKE
THE STATEMENTS THEREIN, IN THE LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE
MADE, NOT MISLEADING; PROVIDED THAT THE ISSUER, NOVAMERICAN STEEL AND THE
GUARANTORS MAKE NO REPRESENTATION OR WARRANTY WITH RESPECT TO ANY STATEMENTS OR
OMISSIONS MADE IN THE PRELIMINARY OFFERING MEMORANDUM, THE TIME OF SALE
INFORMATION OR THE OFFERING MEMORANDUM IN RELIANCE

 

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UPON AND IN CONFORMITY WITH INFORMATION RELATING TO ANY INITIAL PURCHASER
FURNISHED TO THE ISSUER IN WRITING BY SUCH INITIAL PURCHASER THROUGH THE
REPRESENTATIVE EXPRESSLY FOR USE THEREIN.

 

(B)                                 ADDITIONAL WRITTEN COMMUNICATIONS. THE
ISSUER, NSI AND THE GUARANTORS (INCLUDING THEIR RESPECTIVE AGENTS AND
REPRESENTATIVES, OTHER THAN THE INITIAL PURCHASERS IN THEIR CAPACITY AS SUCH)
HAVE NOT PREPARED, MADE, USED, AUTHORIZED, APPROVED OR REFERRED TO AND WILL NOT
PREPARE, MAKE, USE, AUTHORIZE, APPROVE OR REFER TO ANY WRITTEN COMMUNICATION
THAT CONSTITUTES AN OFFER TO SELL OR SOLICITATION OF AN OFFER TO BUY THE
SECURITIES (EACH SUCH COMMUNICATION BY THE ISSUER, NSI OR THE GUARANTORS, OR
THEIR RESPECTIVE AGENTS AND REPRESENTATIVES (OTHER THAN A COMMUNICATION REFERRED
TO IN CLAUSES (I), (II) AND (III) BELOW) AN “ISSUER WRITTEN COMMUNICATION”)
OTHER THAN (I) THE PRELIMINARY OFFERING MEMORANDUM, (II) THE OFFERING
MEMORANDUM, (III) THE DOCUMENTS LISTED ON ANNEX A HERETO, INCLUDING A TERM SHEET
SUBSTANTIALLY IN THE FORM OF ANNEX B HERETO, WHICH CONSTITUTE PART OF THE TIME
OF SALE INFORMATION, AND (IV) ANY ELECTRONIC ROAD SHOW OR OTHER WRITTEN
COMMUNICATIONS, IN EACH CASE USED IN ACCORDANCE WITH SECTION 4(C). EACH SUCH
ISSUER WRITTEN COMMUNICATION, WHEN TAKEN TOGETHER WITH THE TIME OF SALE
INFORMATION, DID NOT, AND AT THE CLOSING DATE WILL NOT, CONTAIN ANY UNTRUE
STATEMENT OF A MATERIAL FACT OR OMIT TO STATE A MATERIAL FACT NECESSARY IN ORDER
TO MAKE THE STATEMENTS THEREIN, IN THE LIGHT OF THE CIRCUMSTANCES UNDER WHICH
THEY WERE MADE, NOT MISLEADING; PROVIDED THAT THE ISSUER, NOVAMERICAN STEEL AND
THE GUARANTORS MAKE NO REPRESENTATION AND WARRANTY WITH RESPECT TO ANY
STATEMENTS OR OMISSIONS MADE IN EACH SUCH ISSUER WRITTEN COMMUNICATION IN
RELIANCE UPON AND IN CONFORMITY WITH INFORMATION RELATING TO ANY INITIAL
PURCHASER FURNISHED TO THE ISSUER IN WRITING BY SUCH INITIAL PURCHASER THROUGH
THE REPRESENTATIVE EXPRESSLY FOR USE IN ANY ISSUER WRITTEN COMMUNICATION.

 

(C)                                  FINANCIAL STATEMENTS. (I) THE FINANCIAL
STATEMENTS OF NSI AND ITS SUBSIDIARIES AND THE RELATED NOTES THERETO INCLUDED IN
EACH OF THE TIME OF SALE INFORMATION AND THE OFFERING MEMORANDUM PRESENT FAIRLY
THE FINANCIAL POSITION OF NSI AND ITS SUBSIDIARIES AS OF THE DATES INDICATED AND
THE RESULTS OF THEIR OPERATIONS AND THE CHANGES IN THEIR CASH FLOWS FOR THE
PERIODS SPECIFIED AND (II) THE FINANCIAL STATEMENTS OF SYMMETRY AND ITS
SUBSIDIARIES AND THE RELATED NOTES THERETO INCLUDED IN EACH OF THE TIME OF SALE
INFORMATION AND THE OFFERING MEMORANDUM PRESENT FAIRLY THE FINANCIAL POSITION OF
SYMMETRY AND ITS SUBSIDIARIES AS OF THE DATES INDICATED AND THE RESULTS OF THEIR
OPERATIONS AND THE CHANGES IN THEIR CASH FLOWS FOR THE PERIODS SPECIFIED; SUCH
FINANCIAL STATEMENTS HAVE BEEN PREPARED IN CONFORMITY WITH GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES APPLIED ON A CONSISTENT BASIS THROUGHOUT THE PERIODS
COVERED THEREBY; THE OTHER FINANCIAL INFORMATION INCLUDED IN EACH OF THE TIME OF
SALE INFORMATION AND THE OFFERING MEMORANDUM HAS BEEN DERIVED FROM THE
ACCOUNTING RECORDS OF (X) NSI AND ITS SUBSIDIARIES OR (Y) SYMMETRY AND ITS
SUBSIDIARIES, AS THE CASE MAY BE, AND PRESENTS FAIRLY THE INFORMATION SHOWN
THEREBY; AND THE PRO FORMA FINANCIAL INFORMATION AND THE RELATED NOTES THERETO
INCLUDED IN EACH OF THE TIME OF SALE INFORMATION AND THE OFFERING MEMORANDUM HAS
BEEN PREPARED IN ACCORDANCE WITH THE RULES AND GUIDANCE OF THE COMMISSION WITH
RESPECT TO PRO FORMA FINANCIAL INFORMATION, AND THE ASSUMPTIONS UNDERLYING SUCH
PRO FORMA FINANCIAL INFORMATION HAVE BEEN MADE IN GOOD FAITH AND ON A BASIS THAT
THE ISSUER, NOVAMERICAN STEEL AND THE GUARANTORS BELIEVE TO BE REASONABLE IN ALL
MATERIAL RESPECTS AND ARE SET FORTH IN EACH OF THE TIME OF SALE INFORMATION AND
THE OFFERING MEMORANDUM.

 

(D)                                 NO MATERIAL ADVERSE CHANGE. (I)  SINCE THE
DATE OF THE MOST RECENT FINANCIAL STATEMENTS OF NSI AND ITS SUBSIDIARIES
INCLUDED IN EACH OF THE TIME OF SALE INFORMATION AND THE

 

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OFFERING MEMORANDUM, EXCEPT AS CONTEMPLATED IN THE TIME OF SALE INFORMATION AND
THE OFFERING MEMORANDUM: (A) THERE HAS NOT BEEN ANY MATERIAL CHANGE IN THE
CAPITAL STOCK OF NSI OR ANY OF ITS SUBSIDIARIES, ANY MATERIAL INCREASE IN THE
CONSOLIDATED LONG TERM DEBT OF NSI AND ITS SUBSIDIARIES OR ANY DIVIDEND OR
DISTRIBUTION OF ANY KIND DECLARED, SET ASIDE FOR PAYMENT, PAID OR MADE BY NSI ON
ANY CLASS OF CAPITAL STOCK, OR ANY MATERIAL ADVERSE CHANGE, OR ANY DEVELOPMENT
INVOLVING A PROSPECTIVE MATERIAL ADVERSE CHANGE, IN OR AFFECTING THE BUSINESS,
PROPERTIES, MANAGEMENT, FINANCIAL POSITION, RESULTS OF OPERATIONS OR PROSPECTS
OF NSI AND ITS SUBSIDIARIES, TAKEN AS A WHOLE; (B) NEITHER NSI NOR ANY OF ITS
SUBSIDIARIES HAS ENTERED INTO ANY TRANSACTION OR AGREEMENT THAT IS MATERIAL TO
NSI AND ITS SUBSIDIARIES, TAKEN AS A WHOLE, OR INCURRED ANY LIABILITY OR
OBLIGATION, DIRECT OR CONTINGENT, THAT IS MATERIAL TO NSI AND ITS SUBSIDIARIES,
TAKEN AS A WHOLE; AND (C) NEITHER NSI NOR ANY OF ITS SUBSIDIARIES HAS SUSTAINED
ANY MATERIAL LOSS OR MATERIAL INTERFERENCE WITH ITS BUSINESS FROM FIRE,
EXPLOSION, FLOOD OR OTHER CALAMITY, WHETHER OR NOT COVERED BY INSURANCE, OR FROM
ANY LABOR DISTURBANCE OR DISPUTE OR ANY ACTION, ORDER OR DECREE OF ANY COURT OR
ARBITRATOR OR GOVERNMENTAL OR REGULATORY AUTHORITY.

 

(II)                                  SINCE THE DATE OF THE MOST RECENT
FINANCIAL STATEMENTS OF SYMMETRY AND ITS SUBSIDIARIES INCLUDED IN EACH OF THE
TIME OF SALE INFORMATION AND THE OFFERING MEMORANDUM, EXCEPT AS CONTEMPLATED IN
THE TIME OF SALE INFORMATION AND THE OFFERING MEMORANDUM (INCLUDING PAYMENTS TO
BE MADE TO SYMMETRY STOCKHOLDERS IN RESPECT OF THE CONVERSION OF SHARES OF
SYMMETRY COMMON STOCK INTO CASH): (A) THERE HAS NOT BEEN ANY MATERIAL CHANGE IN
THE CAPITAL STOCK OR MATERIAL INCREASE IN LONG-TERM DEBT OF SYMMETRY OR ANY OF
ITS SUBSIDIARIES OR ANY DIVIDEND OR DISTRIBUTION OF ANY KIND DECLARED, SET ASIDE
FOR PAYMENT, PAID OR MADE BY THE SYMMETRY OR ANY OF ITS SUBSIDIARIES ON ANY
CLASS OF CAPITAL STOCK, OR ANY MATERIAL ADVERSE CHANGE, OR ANY DEVELOPMENT
INVOLVING A PROSPECTIVE MATERIAL ADVERSE CHANGE, IN OR AFFECTING THE BUSINESS,
PROPERTIES, MANAGEMENT, FINANCIAL POSITION, RESULTS OF OPERATIONS OR PROSPECTS
OF SYMMETRY AND ITS SUBSIDIARIES, TAKEN AS A WHOLE; (B) NEITHER SYMMETRY NOR ANY
OF ITS SUBSIDIARIES HAS ENTERED INTO ANY TRANSACTION OR AGREEMENT THAT IS
MATERIAL TO SYMMETRY AND ITS SUBSIDIARIES, TAKEN AS A WHOLE, OR INCURRED ANY
LIABILITY OR OBLIGATION, DIRECT OR CONTINGENT, THAT IS MATERIAL TO SYMMETRY AND
ITS SUBSIDIARIES, TAKEN AS A WHOLE; AND (C) NEITHER SYMMETRY NOR ANY OF ITS
SUBSIDIARIES HAS SUSTAINED ANY MATERIAL LOSS OR MATERIAL INTERFERENCE WITH ITS
BUSINESS FROM FIRE, EXPLOSION, FLOOD OR OTHER CALAMITY, WHETHER OR NOT COVERED
BY INSURANCE, OR FROM ANY LABOR DISTURBANCE OR DISPUTE OR ANY ACTION, ORDER OR
DECREE OF ANY COURT OR ARBITRATOR OR GOVERNMENTAL OR REGULATORY AUTHORITY.

 

(E)                                  ORGANIZATION AND GOOD STANDING. SYMMETRY
AND EACH OF THE POST TRANSACTION SUBSIDIARIES HAVE BEEN (OR WILL BE AS OF THE
CLOSING DATE, IN THE CASE OF POST TRANSACTION SUBSIDIARIES THAT WILL BE
ORGANIZED AS PART OF THE TRANSACTIONS) DULY ORGANIZED AND ARE (OR WILL BE AS OF
THE CLOSING DATE, IN THE CASE OF POST TRANSACTION SUBSIDIARIES THAT WILL BE
ORGANIZED AS PART OF THE TRANSACTIONS) VALIDLY EXISTING AND IN GOOD STANDING
UNDER THE LAWS OF THEIR RESPECTIVE JURISDICTIONS OF ORGANIZATION, ARE (OR WILL
BE AS OF THE CLOSING DATE, IN THE CASE OF POST TRANSACTION SUBSIDIARIES THAT
WILL BE ORGANIZED AS PART OF THE TRANSACTIONS) DULY QUALIFIED TO DO BUSINESS AND
ARE (OR WILL BE AS OF THE CLOSING DATE, IN THE CASE OF POST TRANSACTION
SUBSIDIARIES THAT WILL BE ORGANIZED AS PART OF THE TRANSACTIONS) IN GOOD
STANDING IN EACH JURISDICTION IN WHICH THEIR RESPECTIVE OWNERSHIP OR LEASE OF
PROPERTY OR THE CONDUCT OF THEIR RESPECTIVE BUSINESSES REQUIRES SUCH
QUALIFICATION, AND HAVE (OR WILL HAVE AS OF THE CLOSING DATE, IN THE CASE OF
POST TRANSACTION SUBSIDIARIES THAT WILL BE ORGANIZED AS PART OF THE
TRANSACTIONS) ALL POWER AND

 

8

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AUTHORITY NECESSARY TO OWN OR HOLD THEIR RESPECTIVE PROPERTIES AND TO CONDUCT
THE BUSINESSES IN WHICH THEY ARE ENGAGED, EXCEPT WHERE THE FAILURE TO BE SO
QUALIFIED, IN GOOD STANDING OR HAVE SUCH POWER OR AUTHORITY WOULD NOT,
INDIVIDUALLY OR IN THE AGGREGATE, HAVE A MATERIAL ADVERSE EFFECT ON THE
BUSINESS, PROPERTIES, MANAGEMENT, FINANCIAL POSITION, RESULTS OF OPERATIONS OR
PROSPECTS OF SYMMETRY AND THE POST TRANSACTION SUBSIDIARIES, TAKEN AS A WHOLE,
OR ON THE PERFORMANCE BY THE ISSUER AND THE GUARANTORS OF THEIR OBLIGATIONS
UNDER THE SECURITIES AND THE GUARANTEES OR THE PERFORMANCE BY NOVAMERICAN STEEL
OF ITS OBLIGATIONS UNDER THE INTERCOMPANY NOTE (A “MATERIAL ADVERSE EFFECT”). IN
ADDITION, IMMEDIATELY PRIOR TO THE COMMENCEMENT OF THE TRANSACTIONS, (I) NSI DID
NOT OWN OR CONTROL, DIRECTLY OR INDIRECTLY, ANY CORPORATION, ASSOCIATION OR
OTHER ENTITY OTHER THAN THE SUBSIDIARIES LISTED SCHEDULE 5(A) HERETO, (II) THE
ISSUER DID NOT OWN OR CONTROL, DIRECTLY OR INDIRECTLY, ANY CORPORATION,
ASSOCIATION OR OTHER ENTITY OTHER THAN THE SUBSIDIARIES LISTED IN SCHEDULE 5(B)
HERETO, (III) SYMMETRY DID NOT OWN OR CONTROL, DIRECTLY OR INDIRECTLY, ANY
CORPORATION, ASSOCIATION OR OTHER ENTITY OTHER THAN THE SUBSIDIARIES LISTED IN
SCHEDULE 5(C)(1) HERETO. FURTHER, IMMEDIATELY FOLLOWING THE CONSUMMATION OF THE
TRANSACTIONS, SYMMETRY WILL NOT OWN OR CONTROL, DIRECTLY OR INDIRECTLY, ANY
CORPORATION, ASSOCIATION OR OTHER ENTITY OTHER THAN THE SUBSIDIARIES LISTED IN
SCHEDULE 5(C)(2) HERETO.

 

(F)                                    CAPITALIZATION. AS OF SEPTEMBER 30, 2007,
ON A PRO FORMA BASIS AFTER GIVING EFFECT TO THE CONSUMMATION OF THE
TRANSACTIONS, SYMMETRY AND THE POST TRANSACTION SUBSIDIARIES, ON A CONSOLIDATED
BASIS, WOULD HAVE HAD AN AUTHORIZED CAPITALIZATION AS SET FORTH IN EACH OF THE
TIME OF SALE INFORMATION AND THE OFFERING MEMORANDUM UNDER THE HEADING
“CAPITALIZATION”. IMMEDIATELY FOLLOWING CONSUMMATION OF THE TRANSACTIONS, ALL
THE OUTSTANDING SHARES OF CAPITAL STOCK OR OTHER EQUITY INTERESTS OF EACH OF THE
POST TRANSACTION SUBSIDIARIES WILL HAVE BEEN DULY AND VALIDLY AUTHORIZED AND
ISSUED, WILL BE FULLY PAID AND NON-ASSESSABLE AND WILL BE OWNED DIRECTLY OR
INDIRECTLY BY SYMMETRY, FREE AND CLEAR OF ANY LIEN, CHARGE, ENCUMBRANCE,
SECURITY INTEREST, RESTRICTION ON VOTING OR TRANSFER OR ANY OTHER CLAIM OF ANY
THIRD PARTY (EXCLUDING (I) ANY RESTRICTIONS ON THE TRANSFER OF SHARES OF CAPITAL
STOCK OR OTHER EQUITY INTERESTS IN THE ORGANIZATIONAL DOCUMENTS OF 3217928 NOVA
SCOTIA COMPANY, 3217930 NOVA SCOTIA COMPANY, 3218088 NOVA SCOTIA COMPANY AND
4421591 (AS DEFINED BELOW) OR (II) ANY RESTRICTIONS OR LIMITATIONS SET FORTH IN
THE ORGANIZATIONAL DOCUMENTS OR RELATED JOINT VENTURE AGREEMENTS OF DELTA TUBE
INC., A QUÉBEC COMPANY (“DELTA TUBE”) OR TUBES DELTA, SOCIÉTÉ EN COMMANDITE, A
QUÉBEC LIMITED PARTNERSHIP (“TUBES DELTA”).

 

(G)                                 DUE AUTHORIZATION. THE ISSUER, NOVAMERICAN
STEEL AND EACH OF THE GUARANTORS HAS (OR WILL HAVE AS OF THE CLOSING DATE, IN
THE CASE OF NOVAMERICAN STEEL AND THE GUARANTORS THAT WILL BE ORGANIZED, OR
ACQUIRED, DIRECTLY OR INDIRECTLY, BY SYMMETRY, AS PART OF THE TRANSACTIONS) FULL
RIGHT, POWER AND AUTHORITY TO EXECUTE AND DELIVER THIS AGREEMENT AND EACH OTHER
TRANSACTION DOCUMENT TO WHICH IT IS, OR WILL BE, A PARTY, AS THE CASE MAY BE,
AND TO PERFORM THEIR RESPECTIVE OBLIGATIONS HEREUNDER AND THEREUNDER; AND ALL
ACTION REQUIRED TO BE TAKEN FOR THE DUE AND PROPER AUTHORIZATION, EXECUTION AND
DELIVERY OF EACH OF THE TRANSACTION DOCUMENTS AND THE CONSUMMATION OF THE
TRANSACTIONS CONTEMPLATED THEREBY, IN THE CASE OF THIS AGREEMENT AND THE
ARRANGEMENT AGREEMENT, HAS BEEN DULY AND VALIDLY TAKEN AND, IN THE CASE OF THE
OTHER TRANSACTION DOCUMENTS, WILL HAVE BEEN DULY AND VALIDLY TAKEN ON OR PRIOR
TO THE CLOSING DATE.

 

(H)                                 THE INDENTURE. THE INDENTURE HAS BEEN (OR
WILL BE AS OF THE CLOSING DATE, IN THE CASE OF GUARANTORS THAT WILL BE
ORGANIZED, OR ACQUIRED, DIRECTLY OR INDIRECTLY, BY SYMMETRY, AS PART OF THE
TRANSACTIONS) DULY AUTHORIZED BY THE ISSUER AND EACH OF THE GUARANTORS AND, WHEN

 

9

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DULY EXECUTED AND DELIVERED IN ACCORDANCE WITH ITS TERMS BY EACH OF THE PARTIES
THERETO, WILL CONSTITUTE A VALID AND LEGALLY BINDING AGREEMENT OF THE ISSUER AND
EACH OF THE GUARANTORS ENFORCEABLE AGAINST THE ISSUER AND EACH OF THE GUARANTORS
IN ACCORDANCE WITH ITS TERMS, EXCEPT TO THE EXTENT THAT (W) ENFORCEABILITY
MAY BE LIMITED BY APPLICABLE BANKRUPTCY, INSOLVENCY, FRAUDULENT CONVEYANCE OR
SIMILAR LAWS AFFECTING THE ENFORCEMENT OF CREDITORS’ RIGHTS GENERALLY, (X)
RIGHTS OF ACCELERATION, IF APPLICABLE, AND THE AVAILABILITY OF EQUITABLE
REMEDIES MAY BE LIMITED BY EQUITABLE PRINCIPLES GENERALLY, OR (Y) RIGHTS TO
INDEMNIFICATION AND CONTRIBUTION MAY BE LIMITED BY PUBLIC POLICY (COLLECTIVELY,
THE “ENFORCEABILITY EXCEPTIONS”); AND ON THE CLOSING DATE, THE INDENTURE WILL
CONFORM IN ALL MATERIAL RESPECTS TO THE REQUIREMENTS OF THE TRUST INDENTURE ACT
OF 1939, AS AMENDED (THE “TRUST INDENTURE ACT”), AND THE RULES AND REGULATIONS
OF THE COMMISSION APPLICABLE TO AN INDENTURE THAT IS QUALIFIED THEREUNDER.

 

(I)                                     THE SECURITIES AND THE GUARANTEES. THE
SECURITIES HAVE BEEN DULY AUTHORIZED BY THE ISSUER AND, WHEN DULY EXECUTED,
AUTHENTICATED, ISSUED AND DELIVERED AS PROVIDED IN THE INDENTURE AND PAID FOR AS
PROVIDED HEREIN, WILL BE DULY AND VALIDLY ISSUED AND OUTSTANDING AND WILL
CONSTITUTE VALID AND LEGALLY BINDING OBLIGATIONS OF THE ISSUER ENFORCEABLE
AGAINST THE ISSUER IN ACCORDANCE WITH THEIR TERMS, SUBJECT TO THE ENFORCEABILITY
EXCEPTIONS, AND WILL BE ENTITLED TO THE BENEFITS OF THE INDENTURE; AND THE
GUARANTEES HAVE BEEN (OR WILL BE AS OF THE CLOSING DATE, IN THE CASE OF
GUARANTORS THAT WILL BE ORGANIZED, OR ACQUIRED, DIRECTLY OR INDIRECTLY, BY
SYMMETRY, AS PART OF THE TRANSACTIONS) DULY AUTHORIZED BY EACH OF THE GUARANTORS
AND, WHEN THE SECURITIES HAVE BEEN DULY EXECUTED, AUTHENTICATED, ISSUED AND
DELIVERED AS PROVIDED IN THE INDENTURE AND PAID FOR AS PROVIDED HEREIN, WILL BE
VALID AND LEGALLY BINDING OBLIGATIONS OF EACH OF THE GUARANTORS, ENFORCEABLE
AGAINST EACH OF THE GUARANTORS IN ACCORDANCE WITH THEIR TERMS, SUBJECT TO THE
ENFORCEABILITY EXCEPTIONS, AND WILL BE ENTITLED TO THE BENEFITS OF THE
INDENTURE.

 

(J)                                     THE EXCHANGE SECURITIES. ON THE CLOSING
DATE, THE EXCHANGE SECURITIES (INCLUDING THE RELATED GUARANTEES) WILL HAVE BEEN
DULY AUTHORIZED BY THE ISSUER AND EACH OF THE GUARANTORS AND, WHEN DULY
EXECUTED, AUTHENTICATED, ISSUED AND DELIVERED AS CONTEMPLATED BY THE
REGISTRATION RIGHTS AGREEMENT AND AS PROVIDED IN THE INDENTURE, WILL BE DULY AND
VALIDLY ISSUED AND OUTSTANDING AND WILL CONSTITUTE VALID AND LEGALLY BINDING
OBLIGATIONS OF THE ISSUER, AS ISSUER, AND EACH OF THE GUARANTORS, AS GUARANTOR,
ENFORCEABLE AGAINST THE ISSUER AND EACH OF THE GUARANTORS IN ACCORDANCE WITH
THEIR TERMS, SUBJECT TO THE ENFORCEABILITY EXCEPTIONS, AND WILL BE ENTITLED TO
THE BENEFITS OF THE INDENTURE.

 

(K)                                  PURCHASE AND REGISTRATION RIGHTS
AGREEMENTS. THIS AGREEMENT HAS BEEN (OR WILL BE AS OF THE CLOSING DATE, IN THE
CASE OF NOVAMERICAN STEEL AND THE GUARANTORS THAT WILL BE ORGANIZED, OR
ACQUIRED, DIRECTLY OR INDIRECTLY, BY SYMMETRY, AS PART OF THE TRANSACTIONS) DULY
AUTHORIZED, EXECUTED AND DELIVERED BY THE ISSUER, NOVAMERICAN STEEL AND EACH OF
THE GUARANTORS, AND THE REGISTRATION RIGHTS AGREEMENT HAS BEEN (OR WILL BE AS OF
THE CLOSING DATE, IN THE CASE OF GUARANTORS THAT WILL BE ORGANIZED, OR ACQUIRED,
DIRECTLY OR INDIRECTLY, BY SYMMETRY, AS PART OF THE TRANSACTIONS) DULY
AUTHORIZED BY THE ISSUER AND EACH OF THE GUARANTORS AND ON THE CLOSING DATE WILL
BE DULY EXECUTED AND DELIVERED BY THE ISSUER AND EACH OF THE GUARANTORS AND,
WHEN DULY EXECUTED AND DELIVERED IN ACCORDANCE WITH ITS TERMS BY EACH OF THE
PARTIES THERETO, WILL CONSTITUTE A VALID AND LEGALLY BINDING AGREEMENT OF THE
ISSUER AND EACH OF THE GUARANTORS ENFORCEABLE AGAINST THE ISSUER AND EACH OF THE
GUARANTORS IN ACCORDANCE WITH ITS TERMS, SUBJECT TO THE ENFORCEABILITY
EXCEPTIONS.

 

10

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(L)                                     JOINDER AGREEMENT. THE JOINDER AGREEMENT
HAS BEEN (OR WILL BE AS OF THE CLOSING DATE, IN THE CASE OF NOVAMERICAN STEEL
AND GUARANTORS THAT WILL BE ORGANIZED, OR ACQUIRED, DIRECTLY OR INDIRECTLY, BY
SYMMETRY, AS PART OF THE TRANSACTIONS) DULY AUTHORIZED BY THE ISSUER,
NOVAMERICAN STEEL AND EACH OF THE GUARANTORS AND, WHEN DULY EXECUTED AND
DELIVERED IN ACCORDANCE WITH ITS TERMS BY EACH OF THE PARTIES THERETO, WILL
CONSTITUTE A VALID AND LEGALLY BINDING AGREEMENT OF THE ISSUER, NOVAMERICAN
STEEL AND EACH OF THE GUARANTORS ENFORCEABLE AGAINST THE ISSUER, NOVAMERICAN
STEEL AND EACH OF THE GUARANTORS IN ACCORDANCE WITH ITS TERMS, SUBJECT TO THE
ENFORCEABILITY EXCEPTIONS.

 

(M)                               SECURITY AGREEMENTS AND THE INTERCREDITOR
AGREEMENT. EACH OF THE SECURITY AGREEMENTS HAS BEEN (OR WILL BE AS OF THE
CLOSING DATE, IN THE CASE OF GUARANTORS THAT WILL BE ORGANIZED, OR ACQUIRED,
DIRECTLY OR INDIRECTLY, BY SYMMETRY, AS PART OF THE TRANSACTIONS) DULY
AUTHORIZED BY EACH OF THE ISSUER AND THE GUARANTORS (TO THE EXTENT IT IS A PARTY
THERETO) AND, ON THE CLOSING DATE, THE COLLATERAL AGREEMENT WILL BE DULY
EXECUTED AND DELIVERED BY EACH OF THE ISSUER AND THE GUARANTORS AND, WHEN DULY
EXECUTED AND DELIVERED IN ACCORDANCE WITH ITS TERMS BY EACH OF THE PARTIES
THERETO, WILL CONSTITUTE A VALID AND LEGALLY BINDING AGREEMENT OF EACH OF THE
ISSUER AND THE GUARANTORS IN ACCORDANCE WITH ITS TERMS, SUBJECT TO THE
ENFORCEABILITY EXCEPTIONS; AND THE INTERCREDITOR AGREEMENT HAS BEEN (OR WILL BE
AS OF THE CLOSING DATE, IN THE CASE OF GUARANTORS THAT WILL BE ORGANIZED, OR
ACQUIRED, DIRECTLY OR INDIRECTLY, BY SYMMETRY, AS PART OF THE TRANSACTIONS) DULY
AUTHORIZED BY THE ISSUER, NOVAMERICAN AND THE GUARANTORS AND ON THE CLOSING DATE
WILL BE DULY EXECUTED AND DELIVERED BY THE ISSUER, NOVAMERICAN AND THE
GUARANTORS AND, WHEN DULY EXECUTED AND DELIVERED IN ACCORDANCE WITH ITS TERMS BY
EACH OF THE PARTIES THERETO, WILL CONSTITUTE A VALID AND LEGALLY BINDING
AGREEMENT OF EACH OF THE ISSUER AND THE GUARANTORS IN ACCORDANCE WITH ITS TERMS,
SUBJECT TO THE ENFORCEABILITY EXCEPTIONS.

 

(N)                                 TRANSACTION DOCUMENTS. EACH OF THE
INTERCOMPANY NOTE, THE CANADIAN SECURITY AGREEMENTS AND THE CREDIT DOCUMENTS HAS
BEEN (OR WILL BE AS OF THE CLOSING DATE, IN THE CASE OF NOVAMERICAN STEEL AND
THE GUARANTORS THAT WILL BE ORGANIZED, OR ACQUIRED, DIRECTLY OR INDIRECTLY, BY
SYMMETRY, AS PART OF THE TRANSACTIONS) DULY AUTHORIZED BY EACH OF THE ISSUER,
NOVAMERICAN STEEL AND THE GUARANTORS (TO THE EXTENT IT IS A PARTY THERETO) AND
ON THE CLOSING DATE WILL BE DULY EXECUTED AND DELIVERED BY EACH OF THE ISSUER,
NOVAMERICAN STEEL AND THE GUARANTORS (TO THE EXTENT IT IS A PARTY THERETO) AND,
WHEN DULY EXECUTED AND DELIVERED IN ACCORDANCE WITH ITS TERMS BY EACH OF THE
PARTIES THERETO, WILL CONSTITUTE A VALID AND LEGALLY BINDING AGREEMENT OF EACH
OF THE ISSUER, NOVAMERICAN STEEL AND THE GUARANTORS (TO THE EXTENT IT IS A PARTY
THERETO) ENFORCEABLE AGAINST EACH OF THE ISSUER, NOVAMERICAN STEEL AND THE
GUARANTORS (TO THE EXTENT IT IS A PARTY THERETO) IN ACCORDANCE WITH ITS TERMS,
SUBJECT TO THE ENFORCEABILITY EXCEPTIONS.

 

(O)                                 DESCRIPTIONS OF THE TRANSACTION DOCUMENTS.
EACH TRANSACTION DOCUMENT CONFORMS IN ALL MATERIAL RESPECTS TO THE DESCRIPTION
THEREOF CONTAINED IN EACH OF THE TIME OF SALE INFORMATION AND THE OFFERING
MEMORANDUM.

 

(P)                                 NO VIOLATION OR DEFAULT. NEITHER SYMMETRY
NOR ANY OF THE POST TRANSACTION SUBSIDIARIES IS: (I) IN VIOLATION OF ITS CHARTER
OR BY-LAWS OR SIMILAR ORGANIZATIONAL DOCUMENTS; (II) IN DEFAULT, AND NO EVENT
HAS OCCURRED THAT, WITH NOTICE OR LAPSE OF TIME OR BOTH, WOULD CONSTITUTE SUCH A
DEFAULT, IN THE DUE PERFORMANCE OR OBSERVANCE OF ANY TERM, COVENANT OR CONDITION
CONTAINED IN ANY INDENTURE, MORTGAGE, DEED OF TRUST, LOAN AGREEMENT OR OTHER
AGREEMENT OR INSTRUMENT TO WHICH SYMMETRY OR ANY OF THE POST TRANSACTION
SUBSIDIARIES IS A PARTY OR BY

 

11

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WHICH SYMMETRY OR ANY OF THE POST TRANSACTION SUBSIDIARIES IS BOUND OR TO WHICH
ANY OF THE PROPERTY OR ASSETS OF SYMMETRY OR ANY OF THE POST TRANSACTION
SUBSIDIARIES IS SUBJECT; OR (III) IN VIOLATION OF ANY LAW OR STATUTE OR ANY
JUDGMENT, ORDER, RULE OR REGULATION OF ANY COURT OR ARBITRATOR OR GOVERNMENTAL
OR REGULATORY AUTHORITY, EXCEPT, IN THE CASE OF CLAUSES (II) AND (III) ABOVE,
FOR ANY SUCH DEFAULT OR VIOLATION THAT WOULD NOT, INDIVIDUALLY OR IN THE
AGGREGATE, HAVE A MATERIAL ADVERSE EFFECT.

 

(Q)                                 NO CONFLICTS. THE EXECUTION, DELIVERY AND
PERFORMANCE BY EACH OF THE ISSUER, NOVAMERICAN STEEL AND THE GUARANTORS OF EACH
OF THE TRANSACTION DOCUMENTS TO WHICH IT IS A PARTY, THE ISSUANCE AND SALE OF
THE SECURITIES (INCLUDING THE GUARANTEES) AND COMPLIANCE BY THE ISSUER,
NOVAMERICAN STEEL AND THE GUARANTORS WITH THE TERMS THEREOF AND THE CONSUMMATION
OF THE TRANSACTIONS CONTEMPLATED BY THE TRANSACTION DOCUMENTS WILL NOT
(I) CONFLICT WITH OR RESULT IN A BREACH OR VIOLATION OF ANY OF THE TERMS OR
PROVISIONS OF, OR CONSTITUTE A DEFAULT UNDER, OR RESULT IN THE CREATION OR
IMPOSITION OF ANY LIEN, CHARGE OR ENCUMBRANCE UPON ANY PROPERTY OR ASSETS OF
SYMMETRY OR ANY OF THE POST TRANSACTION SUBSIDIARIES PURSUANT TO, ANY INDENTURE,
MORTGAGE, DEED OF TRUST, LOAN AGREEMENT OR OTHER AGREEMENT OR INSTRUMENT TO
WHICH SYMMETRY OR ANY OF THE POST TRANSACTION SUBSIDIARIES IS A PARTY OR BY
WHICH SYMMETRY OR ANY OF THE POST TRANSACTION SUBSIDIARIES IS BOUND OR TO WHICH
ANY OF THE PROPERTY OR ASSETS OF SYMMETRY OR ANY OF THE POST TRANSACTION
SUBSIDIARIES IS SUBJECT, (II) RESULT IN ANY VIOLATION OF THE PROVISIONS OF THE
CHARTER OR BY-LAWS OR SIMILAR ORGANIZATIONAL DOCUMENTS OF SYMMETRY OR ANY OF THE
POST TRANSACTION SUBSIDIARIES OR (III) RESULT IN THE VIOLATION OF ANY LAW OR
STATUTE OR ANY JUDGMENT, ORDER, RULE OR REGULATION OF ANY COURT OR ARBITRATOR OR
GOVERNMENTAL OR REGULATORY AUTHORITY, EXCEPT, IN THE CASE OF CLAUSES (I) AND
(III) ABOVE, FOR ANY SUCH CONFLICT, BREACH, VIOLATION OR DEFAULT THAT WOULD NOT,
INDIVIDUALLY OR IN THE AGGREGATE, HAVE A MATERIAL ADVERSE EFFECT.

 

(R)                                    NO CONSENTS REQUIRED. NO CONSENT,
APPROVAL, AUTHORIZATION, ORDER, REGISTRATION OR QUALIFICATION OF OR WITH ANY
COURT OR ARBITRATOR OR GOVERNMENTAL OR REGULATORY AUTHORITY IS REQUIRED FOR THE
EXECUTION, DELIVERY AND PERFORMANCE BY EACH OF THE ISSUER, NOVAMERICAN STEEL AND
THE GUARANTORS OF EACH OF THE TRANSACTION DOCUMENTS TO WHICH IT IS A PARTY, THE
ISSUANCE AND SALE OF THE SECURITIES (INCLUDING THE GUARANTEES) AND COMPLIANCE BY
THE ISSUER, NOVAMERICAN STEEL AND THE GUARANTORS WITH THE TERMS THEREOF AND THE
CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED BY THE TRANSACTION DOCUMENTS,
EXCEPT (I) FOR SUCH CONSENTS, APPROVALS, AUTHORIZATIONS, ORDERS AND
REGISTRATIONS OR QUALIFICATIONS AS MAY BE REQUIRED (A) UNDER APPLICABLE STATE
SECURITIES LAWS IN CONNECTION WITH THE PURCHASE AND RESALE OF THE SECURITIES
(INCLUDING THE GUARANTEES) BY THE INITIAL PURCHASERS AND (B) WITH RESPECT TO THE
EXCHANGE SECURITIES (INCLUDING THE RELATED GUARANTEES) UNDER THE SECURITIES ACT,
THE TRUST INDENTURE ACT AND APPLICABLE STATE SECURITIES LAWS AS CONTEMPLATED BY
THE REGISTRATION RIGHTS AGREEMENT AND (II) TO THE EXTENT THAT THE FAILURE TO
OBTAIN A CONSENT, APPROVAL, AUTHORIZATION, ORDER, REGISTRATION OR QUALIFICATION,
IN EACH CASE RELATED SOLELY TO THE CONSUMMATION OF THE ACQUISITION AND NOT TO
ANY FINANCING TRANSACTIONS (INCLUDING THE OFFERING AND SALE OF THE SECURITIES)
RELATED THERETO, WOULD NOT, INDIVIDUALLY OR IN THE AGGREGATE, HAVE A MATERIAL
ADVERSE EFFECT.

 

(S)                                  LEGAL PROCEEDINGS. EXCEPT AS DESCRIBED IN
EACH OF THE TIME OF SALE INFORMATION AND THE OFFERING MEMORANDUM, THERE ARE NO
LEGAL, GOVERNMENTAL OR REGULATORY INVESTIGATIONS, ACTIONS, SUITS OR PROCEEDINGS
PENDING TO WHICH SYMMETRY OR ANY OF THE POST TRANSACTION SUBSIDIARIES IS, OR TO
THE BEST KNOWLEDGE OF EACH OF SYMMETRY, THE ISSUER OR HOLDINGS, MAY BE A PARTY
OR TO WHICH ANY PROPERTY OF SYMMETRY OR ANY OF THE POST TRANSACTION SUBSIDIARIES
IS, OR TO

 

12

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THE BEST KNOWLEDGE OF EACH OF SYMMETRY, THE ISSUER OR HOLDINGS, MAY BE SUBJECT
THAT, INDIVIDUALLY OR IN THE AGGREGATE, IF DETERMINED ADVERSELY TO SYMMETRY OR
ANY OF THE POST TRANSACTION SUBSIDIARIES, COULD REASONABLY BE EXPECTED TO HAVE A
MATERIAL ADVERSE EFFECT; AND NO SUCH INVESTIGATIONS, ACTIONS, SUITS OR
PROCEEDINGS ARE TO THE BEST KNOWLEDGE OF EACH OF SYMMETRY, THE ISSUER OR
HOLDINGS THREATENED OR, CONTEMPLATED BY ANY GOVERNMENTAL OR REGULATORY AUTHORITY
OR BY OTHERS.

 

(T)                                    INDEPENDENT ACCOUNTANTS. RAYMOND CHABOT
GRANT THORNTON LLP, WHO HAVE CERTIFIED CERTAIN FINANCIAL STATEMENTS OF NSI AND
ITS SUBSIDIARIES, AND MILLER, ELLIN & COMPANY, LLP, WHO HAVE CERTIFIED CERTAIN
FINANCIAL STATEMENTS OF SYMMETRY, ARE EACH INDEPENDENT PUBLIC ACCOUNTANTS WITH
RESPECT TO NSI AND ITS SUBSIDIARIES AND SYMMETRY, RESPECTIVELY, WITHIN THE
APPLICABLE RULES AND REGULATIONS ADOPTED BY THE CHARTERED ACCOUNTANTS OF CANADA
(ONLY WITH RESPECT TO RAYMOND CHABOT GRANT THORNTON LLP), THE COMMISSION AND THE
PUBLIC COMPANY ACCOUNTING OVERSIGHT BOARD (UNITED STATES) AND AS REQUIRED BY THE
SECURITIES ACT.

 

(U)                                 TITLE TO REAL AND PERSONAL PROPERTY. EXCEPT
AS DESCRIBED IN EACH OF THE TIME OF SALE INFORMATION AND THE OFFERING
MEMORANDUM, UPON CONSUMMATION OF THE TRANSACTIONS, SYMMETRY AND THE POST
TRANSACTION SUBSIDIARIES WILL HAVE GOOD AND MARKETABLE TITLE IN FEE SIMPLE TO,
OR HAVE VALID RIGHTS TO LEASE OR OTHERWISE USE, ALL ITEMS OF REAL AND PERSONAL
PROPERTY THAT ARE MATERIAL TO THE RESPECTIVE BUSINESSES OF SYMMETRY AND THE POST
TRANSACTION SUBSIDIARIES, IN EACH CASE FREE AND CLEAR OF ALL LIENS,
ENCUMBRANCES, CLAIMS AND DEFECTS AND IMPERFECTIONS OF TITLE EXCEPT THOSE THAT
(I) DO NOT MATERIALLY INTERFERE WITH THE USE MADE AND PROPOSED TO BE MADE OF
SUCH PROPERTY BY SYMMETRY AND THE POST TRANSACTION SUBSIDIARIES, (II) COULD NOT
REASONABLY BE EXPECTED, INDIVIDUALLY OR IN THE AGGREGATE, TO HAVE A MATERIAL
ADVERSE EFFECT, (III) ARE PERMITTED UNDER THE INDENTURE AND THE COLLATERAL
AGREEMENT WITH RESPECT TO THE MORTGAGED PROPERTIES, AND FOR WHICH EXCEPTIONS ARE
TAKEN IN THE POLICIES OF TITLE INSURANCE DELIVERED IN RESPECT OF THE MORTGAGED
PROPERTIES OR (IV) ARE PERMITTED UNDER THE INDENTURE AND THE CANADIAN COLLATERAL
AGREEMENT WITH RESPECT TO THE CANADIAN MORTGAGED PROPERTIES, AND FOR WHICH
EXCEPTIONS ARE TAKEN IN THE POLICIES OF TITLE INSURANCE DELIVERED IN RESPECT OF
THE CANADIAN MORTGAGED PROPERTIES.

 

(V)                                 TITLE TO INTELLECTUAL PROPERTY. UPON
CONSUMMATION OF THE TRANSACTIONS, SYMMETRY AND THE POST TRANSACTION SUBSIDIARIES
WILL OWN OR POSSESS ADEQUATE RIGHTS TO USE ALL MATERIAL PATENTS, PATENT
APPLICATIONS, TRADEMARKS, SERVICE MARKS, TRADE NAMES, TRADEMARK REGISTRATIONS,
SERVICE MARK REGISTRATIONS, COPYRIGHTS, LICENSES AND KNOW-HOW (INCLUDING TRADE
SECRETS AND OTHER UNPATENTED AND/OR UNPATENTABLE PROPRIETARY OR CONFIDENTIAL
INFORMATION, SYSTEMS OR PROCEDURES) NECESSARY FOR THE CONDUCT OF THEIR
RESPECTIVE BUSINESSES AS DESCRIBED IN THE TIME OF SALE INFORMATION AND THE
OFFERING MEMORANDUM, NONE OF SYMMETRY, NSI OR ANY OF THEIR RESPECTIVE
SUBSIDIARIES HAS RECEIVED ANY WRITTEN NOTICE OF INFRINGEMENT OF OR CONFLICT WITH
ASSERTED RIGHTS OF OTHER WITH RESPECT TO ANY OF THE FOREGOING WHICH, JOINTLY OR
IN THE AGGREGATE, IF THE SUBJECT OF AN UNFAVORABLE DECISION, RULING OR FINDING
COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.

 

(W)                               NO UNDISCLOSED RELATIONSHIPS. NO RELATIONSHIP,
DIRECT OR INDIRECT, EXISTS BETWEEN OR AMONG SYMMETRY, NSI OR ANY OF THEIR
RESPECTIVE SUBSIDIARIES, ON THE ONE HAND, AND THE DIRECTORS, OFFICERS,
STOCKHOLDERS OR OTHER AFFILIATES OF SYMMETRY, NSI OR ANY OF THEIR RESPECTIVE
SUBSIDIARIES, ON THE OTHER, THAT WOULD BE REQUIRED BY THE SECURITIES ACT TO BE
DESCRIBED IN A REGISTRATION STATEMENT TO BE FILED WITH THE COMMISSION AND THAT
IS NOT SO DESCRIBED IN EACH OF THE

 

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TIME OF SALE INFORMATION AND THE OFFERING MEMORANDUM. AS OF THE CLOSING DATE, NO
RELATIONSHIP, DIRECT OR INDIRECT, WILL EXIST BETWEEN OR AMONG SYMMETRY OR ANY OF
THE POST TRANSACTION SUBSIDIARIES, ON THE ONE HAND, AND THE DIRECTORS, OFFICERS,
STOCKHOLDERS OR OTHER AFFILIATES OF SYMMETRY OR ANY OF THE POST TRANSACTION
SUBSIDIARIES, ON THE OTHER, THAT WOULD BE REQUIRED BY THE SECURITIES ACT TO BE
DESCRIBED IN A REGISTRATION STATEMENT TO BE FILED WITH THE COMMISSION AND THAT
IS NOT SO DESCRIBED IN EACH OF THE TIME OF SALE INFORMATION AND THE OFFERING
MEMORANDUM.

 

(X)                                   INVESTMENT COMPANY ACT. NONE OF SYMMETRY,
NSI OR ANY OF THEIR RESPECTIVE SUBSIDIARIES IS, AND AFTER GIVING EFFECT TO THE
OFFERING AND SALE OF THE SECURITIES AND THE APPLICATION OF THE PROCEEDS THEREOF
AS DESCRIBED IN EACH OF THE TIME OF SALE INFORMATION AND THE OFFERING MEMORANDUM
NONE OF SYMMETRY OR ANY OF THE POST TRANSACTION SUBSIDIARIES WILL BE, AN
“INVESTMENT COMPANY” OR AN ENTITY “CONTROLLED” BY AN “INVESTMENT COMPANY” WITHIN
THE MEANING OF THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED, AND THE RULES AND
REGULATIONS OF THE COMMISSION THEREUNDER (COLLECTIVELY, THE “INVESTMENT COMPANY
ACT”).

 

(Y)                                 HOLDING COMPANY. SYMMETRY IS NOT ENGAGED IN
ANY MATERIAL BUSINESS OR ACTIVITY OTHER THAN THOSE ASSOCIATED WITH BEING A
PUBLIC COMPANY AND THE PURSUIT AND CONSUMMATION OF THE TRANSACTIONS (INCLUDING
THE PURSUIT AND CONSUMMATION OF RELATED APPROVALS AND FINANCINGS AND THE
FORMATION AND OWNERSHIP OF SUBSIDIARIES) AND ACTIVITIES INCIDENTAL THERETO.

 

(Z)                                   TAXES. SYMMETRY, NSI AND THEIR RESPECTIVE
SUBSIDIARIES HAVE PAID ALL MATERIAL FEDERAL, STATE, LOCAL AND FOREIGN TAXES AND
FILED ALL MATERIAL TAX RETURNS REQUIRED TO BE PAID OR FILED BY THEM THROUGH THE
DATE HEREOF; AND, EXCEPT AS OTHERWISE DISCLOSED IN EACH OF THE TIME OF SALE
INFORMATION AND THE OFFERING MEMORANDUM, THERE IS NO TAX DEFICIENCY THAT HAS
BEEN, OR COULD REASONABLY BE EXPECTED TO BE, ASSERTED AGAINST THEM OR ANY OF
THEIR RESPECTIVE PROPERTIES OR ASSETS WHICH COULD REASONABLY BE EXPECTED TO HAVE
A MATERIAL ADVERSE EFFECT.

 

(AA)                            LICENSES AND PERMITS. UPON CONSUMMATION OF THE
TRANSACTIONS, SYMMETRY AND THE POST TRANSACTION SUBSIDIARIES WILL POSSESS ALL
LICENSES, CERTIFICATES, PERMITS AND OTHER AUTHORIZATIONS ISSUED BY, AND HAVE
MADE ALL DECLARATIONS AND FILINGS WITH, THE APPROPRIATE FEDERAL, STATE, LOCAL OR
FOREIGN GOVERNMENTAL OR REGULATORY AUTHORITIES THAT ARE NECESSARY FOR THE
OWNERSHIP OR LEASE OF THEIR RESPECTIVE PROPERTIES OR THE CONDUCT OF THEIR
RESPECTIVE BUSINESSES AS DESCRIBED IN EACH OF THE TIME OF SALE INFORMATION AND
THE OFFERING MEMORANDUM, EXCEPT WHERE THE FAILURE TO POSSESS OR MAKE THE SAME
WOULD NOT, INDIVIDUALLY OR IN THE AGGREGATE, HAVE A MATERIAL ADVERSE EFFECT;
AND, EXCEPT AS DESCRIBED IN EACH OF THE TIME OF SALE INFORMATION AND THE
OFFERING MEMORANDUM, NONE OF SYMMETRY, NSI NOR ANY OF THEIR RESPECTIVE
SUBSIDIARIES HAS RECEIVED NOTICE OF ANY REVOCATION OR MODIFICATION OF ANY SUCH
LICENSE, CERTIFICATE, PERMIT OR AUTHORIZATION OR HAS ANY REASON TO BELIEVE THAT
ANY SUCH LICENSE, CERTIFICATE, PERMIT OR AUTHORIZATION WILL NOT BE RENEWED IN
THE ORDINARY COURSE.

 

(BB)                          NO LABOR DISPUTES. NO LABOR DISTURBANCE BY OR
DISPUTE WITH EMPLOYEES OF SYMMETRY, NSI AND THEIR RESPECTIVE SUBSIDIARIES EXISTS
OR, TO THE BEST KNOWLEDGE OF EACH OF SYMMETRY, THE ISSUER AND HOLDINGS, IS
CONTEMPLATED OR THREATENED AND NONE OF SYMMETRY, THE ISSUER OR HOLDINGS IS AWARE
OF ANY EXISTING OR IMMINENT LABOR DISTURBANCE BY THE EMPLOYEES OF ANY OF THE
PRINCIPAL SUPPLIERS, CONTRACTORS OR CUSTOMERS OF SYMMETRY, NSI OR THEIR
RESPECTIVE SUBSIDIARIES, THAT COULD REASONABLY BE EXPECTED TO RESULT IN A
MATERIAL ADVERSE EFFECT.

 

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(CC)                            COMPLIANCE WITH ENVIRONMENTAL LAWS.
(I) SYMMETRY, NSI AND THEIR RESPECTIVE SUBSIDIARIES (X) ARE IN COMPLIANCE WITH
ANY AND ALL APPLICABLE FEDERAL, STATE, LOCAL AND FOREIGN LAWS, RULES,
REGULATIONS AND ORDERS RELATING TO THE PROTECTION OF HUMAN HEALTH OR SAFETY, THE
ENVIRONMENT, NATURAL RESOURCES, HAZARDOUS OR TOXIC SUBSTANCES OR WASTES,
POLLUTANTS OR CONTAMINANTS (COLLECTIVELY, “ENVIRONMENTAL LAWS”), (Y) HAVE
OBTAINED AND ARE IN COMPLIANCE WITH ALL PERMITS, LICENSES, CERTIFICATES OR OTHER
AUTHORIZATIONS OR APPROVALS REQUIRED UNDER APPLICABLE ENVIRONMENTAL LAWS (THE
“ENVIRONMENTAL PERMITS”) TO CONDUCT THEIR RESPECTIVE BUSINESSES, AND ALL SUCH
ENVIRONMENTAL PERMITS ARE IN FULL FORCE AND EFFECT, AND (Z) HAVE NOT RECEIVED
NOTICE OF ANY ACTUAL OR POTENTIAL LIABILITY UNDER OR RELATING TO ANY
ENVIRONMENTAL LAWS, INCLUDING FOR THE INVESTIGATION OR REMEDIATION OF ANY
DISPOSAL OR RELEASE OF HAZARDOUS OR TOXIC SUBSTANCES OR WASTES, POLLUTANTS OR
CONTAMINANTS, AND SYMMETRY, HOLDINGS AND THE ISSUER HAVE NO KNOWLEDGE OF ANY
EVENT OR CONDITION THAT WOULD REASONABLY BE EXPECTED TO RESULT IN ANY SUCH
NOTICE, AND (II) THERE ARE NO COSTS OR LIABILITIES ASSOCIATED WITH ENVIRONMENTAL
LAWS OF OR RELATING TO THEM, EXCEPT IN THE CASE OF EACH OF CLAUSES (I) AND
(II) ABOVE, FOR ANY SUCH FAILURE TO COMPLY, OR FAILURE TO OBTAIN REQUIRED
PERMITS, LICENSES OR APPROVALS, OR COST OR LIABILITY, AS WOULD NOT, INDIVIDUALLY
OR IN THE AGGREGATE, HAVE A MATERIAL ADVERSE EFFECT OR EXCEPT AS SPECIFICALLY
DISCLOSED IN THE TIME OF SALE INFORMATION AND THE OFFERING MEMORANDUM; AND
(III) EXCEPT AS SPECIFICALLY DISCLOSED IN EACH OF THE TIME OF SALE INFORMATION
AND THE OFFERING MEMORANDUM, (X) THERE ARE NO PROCEEDINGS THAT ARE PENDING, OR
THAT ARE KNOWN TO BE CONTEMPLATED, AGAINST SYMMETRY, NSI OR ANY OF THEIR
RESPECTIVE SUBSIDIARIES UNDER ANY ENVIRONMENTAL LAWS IN WHICH A GOVERNMENTAL
ENTITY IS ALSO A PARTY, OTHER THAN SUCH PROCEEDINGS REGARDING WHICH IT IS
REASONABLY BELIEVED NO MONETARY SANCTIONS OR OTHER LIABILITY OF $100,000 OR MORE
WILL BE IMPOSED, (Y) SYMMETRY, HOLDINGS AND THE ISSUER ARE NOT AWARE OF ANY
INSTANCES OF NON-COMPLIANCE WITH ENVIRONMENTAL LAWS, OR LIABILITIES OR OTHER
OBLIGATIONS UNDER ENVIRONMENTAL LAWS OR CONCERNING HAZARDOUS OR TOXIC SUBSTANCES
OR WASTES, POLLUTANTS OR CONTAMINANTS, THAT COULD REASONABLY BE EXPECTED TO HAVE
A MATERIAL ADVERSE EFFECT ON THE EARNINGS OR COMPETITIVE POSITION OF SYMMETRY
AND THE POST TRANSACTION SUBSIDIARIES, AND (Z) NONE OF SYMMETRY, HOLDINGS OR THE
ISSUER ANTICIPATES MATERIAL CAPITAL EXPENDITURES RELATING TO ANY ENVIRONMENTAL
LAWS.

 

(DD)                          COMPLIANCE WITH ERISA. EXCEPT WHERE FAILURE TO
COMPLY WOULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT,
(I) EACH EMPLOYEE BENEFIT PLAN, WITHIN THE MEANING OF SECTION 3(3) OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), FOR WHICH
THE ISSUER OR ANY MEMBER OF ITS “CONTROLLED GROUP” (DEFINED AS ANY ORGANIZATION
WHICH IS A MEMBER OF A CONTROLLED GROUP OF CORPORATIONS WITHIN THE MEANING OF
SECTION 414 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”)) OR
NSI OR ANY MEMBER OF ITS CONTROLLED GROUP WOULD HAVE ANY LIABILITY (EACH, A
“PLAN”) HAS BEEN MAINTAINED IN COMPLIANCE WITH ITS TERMS AND THE REQUIREMENTS OF
ANY APPLICABLE STATUTES, ORDERS, RULES AND REGULATIONS, INCLUDING BUT NOT
LIMITED TO ERISA AND THE CODE; (II) NO PROHIBITED TRANSACTION, WITHIN THE
MEANING OF SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE, HAS OCCURRED WITH
RESPECT TO ANY PLAN EXCLUDING TRANSACTIONS EFFECTED PURSUANT TO A STATUTORY OR
ADMINISTRATIVE EXEMPTION; (III) FOR EACH PLAN THAT IS SUBJECT TO THE FUNDING
RULES OF SECTION 412 OF THE CODE OR SECTION 302 OF ERISA, NO “ACCUMULATED
FUNDING DEFICIENCY” AS DEFINED IN SECTION 412 OF THE CODE, WHETHER OR NOT
WAIVED, HAS OCCURRED OR IS REASONABLY EXPECTED TO OCCUR; (IV) THE FAIR MARKET
VALUE OF THE ASSETS OF EACH PLAN EXCEEDS THE PRESENT VALUE OF ALL BENEFITS
ACCRUED UNDER SUCH PLAN (DETERMINED BASED ON THOSE ASSUMPTIONS USED TO FUND SUCH
PLAN); (V) NO “REPORTABLE EVENT” (WITHIN THE MEANING OF SECTION 4043(C) OF
ERISA) HAS OCCURRED FOR WHICH THE 30-DAY REPORTING REQUIREMENT HAS NOT BEEN
WAIVED; AND (VI) NONE OF THE ISSUER OR ANY MEMBER OF ITS

 

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CONTROLLED GROUP OR NSI OR ANY MEMBER OF ITS CONTROLLED GROUP HAS INCURRED, NOR
REASONABLY EXPECTS TO INCUR, ANY LIABILITY UNDER TITLE IV OF ERISA (OTHER THAN
CONTRIBUTIONS TO THE PLAN OR PREMIUMS TO THE PBGC, IN THE ORDINARY COURSE AND
WITHOUT DEFAULT) IN RESPECT OF A PLAN (INCLUDING A “MULTIEMPLOYER PLAN”, WITHIN
THE MEANING OF SECTION 4001(A)(3) OF ERISA).

 

(EE)                            CANADIAN BENEFIT AND PENSION PLANS. TO THE
EXTENT FAILURE TO COMPLY WITH THE FOLLOWING REPRESENTATIONS OR WARRANTIES COULD
NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT:  (I) THE CANADIAN
PENSION PLANS (AS DEFINED IN THE CREDIT AGREEMENT) ARE DULY REGISTERED IN
ACCORDANCE WITH ANY APPLICABLE LAW WHICH REQUIRES REGISTRATION AND NO EVENT HAS
OCCURRED THAT IS REASONABLY LIKELY TO CAUSE THE LOSS OF SUCH REGISTERED STATUS;
(II) ALL MATERIAL OBLIGATIONS OF EACH POST TRANSACTION SUBSIDIARY ORGANIZED
UNDER THE LAWS OF CANADA OR ANY PROVINCE THEREOF (THE “CANADIAN SUBSIDIARIES”)
(INCLUDING FIDUCIARY, FUNDING, INVESTMENT AND ADMINISTRATION OBLIGATIONS)
REQUIRED TO BE PERFORMED IN CONNECTION WITH THE CANADIAN PENSION PLANS AND THE
FUNDING AGREEMENTS THEREFOR HAVE BEEN PERFORMED IN A TIMELY FASHION; (III) THERE
HAVE BEEN NO IMPROPER WITHDRAWALS OF THE ASSETS OF THE CANADIAN PENSION PLANS OR
THE CANADIAN BENEFIT PLANS (AS DEFINED IN THE CREDIT AGREEMENT); (IV) THERE ARE
NO OUTSTANDING DISPUTES CONCERNING THE ASSETS HELD UNDER THE FUNDING AGREEMENTS
FOR THE CANADIAN PENSION PLANS; (V) EACH OF THE CANADIAN PENSION PLANS, WHICH IS
A DEFINED BENEFIT REGISTERED PENSION PLAN, IS FULLY FUNDED BOTH ON AN ONGOING
BASIS AND ON A SOLVENCY BASIS (USING ACTUARIAL METHODS AND ASSUMPTIONS WHICH ARE
CONSISTENT WITH THE VALUATIONS LAST FILED WITH THE APPLICABLE GOVERNMENTAL
AUTHORITIES (AS DEFINED IN THE CREDIT AGREEMENT) AND WHICH ARE CONSISTENT WITH
GENERALLY ACCEPTED ACTUARIAL PRINCIPLES); (VI) THERE HAS BEEN NO PARTIAL
TERMINATION OF ANY CANADIAN PENSION PLAN AND NO FACTS OR CIRCUMSTANCES HAVE
OCCURRED OR EXISTED THAT COULD RESULT IN THE DECLARATION OF A PARTIAL
TERMINATION OF ANY CANADIAN PENSION PLAN UNDER APPLICABLE LAW; (VII) NO PROMISES
OF BENEFIT IMPROVEMENTS UNDER THE CANADIAN PENSION PLANS OR THE CANADIAN BENEFIT
PLANS HAVE BEEN MADE AND IN ANY EVENT NO SUCH IMPROVEMENTS WILL RESULT IN A
SOLVENCY DEFICIENCY OR GOING CONCERN UNFUNDED LIABILITY IN THE AFFECTED CANADIAN
PENSION PLANS; (VIII) ALL CONTRIBUTIONS OR PREMIUMS REQUIRED TO BE MADE OR PAID
BY THE CANADIAN SUBSIDIARIES TO THE CANADIAN PENSION PLANS OR THE CANADIAN
BENEFIT PLANS HAVE BEEN MADE OR PAID IN A TIMELY FASHION IN ACCORDANCE WITH THE
TERMS OF SUCH PLANS AND APPLICABLE LAW; (IX) ALL EMPLOYEE CONTRIBUTIONS TO THE
CANADIAN PENSION PLANS OR THE CANADIAN BENEFIT PLANS BY WAY OF AUTHORIZED
PAYROLL DEDUCTION OR OTHERWISE HAVE BEEN PROPERLY WITHHELD OR COLLECTED BY THE
CANADIAN SUBSIDIARIES AND FULLY PAID INTO SUCH PLANS IN A TIMELY MANNER; (X) THE
PENSION FUND UNDER EACH CANADIAN PENSION PLAN IS EXEMPT FROM THE PAYMENT OF ANY
INCOME TAX AND THERE ARE NO TAXES, PENALTIES OR INTEREST OWING IN RESPECT OF ANY
SUCH PENSION FUND; AND (XI) ALL MATERIAL REPORTS AND DISCLOSURES RELATING THE
CANADIAN PENSION PLANS REQUIRED BY SUCH PLANS AND APPLICABLE LAW HAVE BEEN FILED
OR DISTRIBUTED IN A TIMELY MANNER.

 

(FF)                                DISCLOSURE CONTROLS. EACH OF SYMMETRY AND
ITS SUBSIDIARIES AND NSI AND ITS SUBSIDIARIES MAINTAIN AN EFFECTIVE SYSTEM OF
“DISCLOSURE CONTROLS AND PROCEDURES” (AS DEFINED IN RULE 13A-15(E) OF THE
EXCHANGE ACT) THAT IS DESIGNED TO ENSURE THAT INFORMATION REQUIRED TO BE
DISCLOSED IN REPORTS THAT ARE FILED OR SUBMITTED UNDER THE EXCHANGE ACT IS
RECORDED, PROCESSED, SUMMARIZED AND REPORTED WITHIN THE TIME PERIODS SPECIFIED
IN THE COMMISSION’S RULES AND FORMS, INCLUDING CONTROLS AND PROCEDURES DESIGNED
TO ENSURE THAT SUCH INFORMATION IS ACCUMULATED AND COMMUNICATED TO MANAGEMENT AS
APPROPRIATE TO ALLOW TIMELY DECISIONS REGARDING REQUIRED DISCLOSURE. EACH OF
SYMMETRY AND ITS SUBSIDIARIES AND NSI AND ITS SUBSIDIARIES HAVE CARRIED OUT

 

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EVALUATIONS OF THE EFFECTIVENESS OF THEIR DISCLOSURE CONTROLS AND PROCEDURES AS
REQUIRED BY RULE 13A-15 OF THE EXCHANGE ACT.

 

(GG)                          ACCOUNTING CONTROLS. EACH OF SYMMETRY AND ITS
SUBSIDIARIES AND NSI AND ITS SUBSIDIARIES MAINTAIN SYSTEMS OF “INTERNAL CONTROL
OVER FINANCIAL REPORTING” (AS DEFINED IN RULE 13A-15(F) OF THE EXCHANGE ACT)
THAT COMPLY WITH THE REQUIREMENTS OF THE EXCHANGE ACT AND HAVE BEEN DESIGNED BY,
OR UNDER THE SUPERVISION OF, THEIR RESPECTIVE PRINCIPAL EXECUTIVE AND PRINCIPAL
FINANCIAL OFFICERS, OR PERSONS PERFORMING SIMILAR FUNCTIONS, TO PROVIDE
REASONABLE ASSURANCE REGARDING THE RELIABILITY OF FINANCIAL REPORTING AND THE
PREPARATION OF FINANCIAL STATEMENTS FOR EXTERNAL PURPOSES IN ACCORDANCE WITH
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. EACH OF SYMMETRY AND ITS SUBSIDIARIES
AND NSI AND ITS SUBSIDIARIES MAINTAIN INTERNAL ACCOUNTING CONTROLS SUFFICIENT TO
PROVIDE REASONABLE ASSURANCE THAT:  (I) TRANSACTIONS ARE EXECUTED IN ACCORDANCE
WITH MANAGEMENT’S GENERAL OR SPECIFIC AUTHORIZATIONS; (II) TRANSACTIONS ARE
RECORDED AS NECESSARY TO PERMIT PREPARATION OF FINANCIAL STATEMENTS IN
CONFORMITY WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES AND TO MAINTAIN ASSET
ACCOUNTABILITY; (III) ACCESS TO ASSETS IS PERMITTED ONLY IN ACCORDANCE WITH
MANAGEMENT’S GENERAL OR SPECIFIC AUTHORIZATION; AND (IV) THE RECORDED
ACCOUNTABILITY FOR ASSETS IS COMPARED WITH THE EXISTING ASSETS AT REASONABLE
INTERVALS AND APPROPRIATE ACTION IS TAKEN WITH RESPECT TO ANY DIFFERENCES.
EXCEPT AS DISCLOSED IN EACH OF THE TIME OF SALE INFORMATION AND THE OFFERING
MEMORANDUM, THERE ARE NO MATERIAL WEAKNESSES OR SIGNIFICANT DEFICIENCIES IN THE
INTERNAL CONTROLS OF SYMMETRY AND ITS SUBSIDIARIES OR NSI AND ITS SUBSIDIARIES.

 

(HH)                          INSURANCE. UPON CONSUMMATION OF THE TRANSACTIONS,
SYMMETRY AND THE POST TRANSACTION SUBSIDIARIES WILL HAVE INSURANCE COVERING SUCH
LOSSES AND RISKS AND IN SUCH AMOUNTS AS SYMMETRY REASONABLY BELIEVES ARE PRUDENT
AND CUSTOMARY IN THE BUSINESSES IN WHICH WILL BE ENGAGED; NEITHER SYMMETRY, NSI
NOR ANY OF THEIR RESPECTIVE SUBSIDIARIES HAS RECEIVED NOTICE FROM ANY INSURER OR
AGENT OF SUCH INSURER THAT CAPITAL IMPROVEMENTS OR OTHER EXPENDITURES ARE
REQUIRED OR NECESSARY TO BE MADE IN ORDER TO CONTINUE ANY MATERIAL INSURANCE
COVERAGE CURRENTLY MAINTAINED BY IT; NEITHER SYMMETRY, HOLDINGS OR THE ISSUER
HAS ANY REASON TO BELIEVE THAT SYMMETRY OR ANY OF THE POST TRANSACTION
SUBSIDIARIES WILL NOT BE ABLE TO RENEW EXISTING INSURANCE COVERAGE AS AND WHEN
SUCH COVERAGE EXPIRES OR TO OBTAIN SIMILAR COVERAGE FROM SIMILAR INSURERS AS
MAY BE NECESSARY TO CONTINUE ITS BUSINESS AT A COST THAT WOULD NOT REASONABLY BE
EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT, EXCEPT IN ANY SUCH CASE, AS
DESCRIBED IN THE TIME OF SALE INFORMATION AND THE OFFERING MEMORANDUM.

 

(II)                                  NO UNLAWFUL PAYMENTS. NEITHER SYMMETRY NOR
ANY OF ITS SUBSIDIARIES NOR, TO THE BEST KNOWLEDGE OF EACH OF SYMMETRY, THE
ISSUER AND HOLDINGS, ANY DIRECTOR, OFFICER, AGENT, EMPLOYEE OR OTHER PERSON
ASSOCIATED WITH OR ACTING ON BEHALF OF SYMMETRY, NSI OR ANY OF THEIR RESPECTIVE
SUBSIDIARIES HAS (I) USED ANY CORPORATE FUNDS FOR ANY UNLAWFUL CONTRIBUTION,
GIFT, ENTERTAINMENT OR OTHER UNLAWFUL EXPENSE RELATING TO POLITICAL ACTIVITY;
(II) MADE ANY DIRECT OR INDIRECT UNLAWFUL PAYMENT TO ANY FOREIGN OR DOMESTIC
GOVERNMENT OFFICIAL OR EMPLOYEE FROM CORPORATE FUNDS; (III) VIOLATED OR IS IN
VIOLATION OF ANY PROVISION OF THE FOREIGN CORRUPT PRACTICES ACT OF 1977; OR
(IV) MADE ANY BRIBE, REBATE, PAYOFF, INFLUENCE PAYMENT, KICKBACK OR OTHER
UNLAWFUL PAYMENT.

 

(JJ)                                  COMPLIANCE WITH MONEY LAUNDERING LAWS. THE
OPERATIONS OF SYMMETRY AND THE POST TRANSACTION SUBSIDIARIES ARE AND HAVE BEEN
CONDUCTED AT ALL TIMES IN MATERIAL COMPLIANCE

 

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WITH APPLICABLE FINANCIAL RECORDKEEPING AND REPORTING REQUIREMENTS OF THE
CURRENCY AND FOREIGN TRANSACTIONS REPORTING ACT OF 1970, AS AMENDED, THE MONEY
LAUNDERING STATUTES OF ALL APPLICABLE JURISDICTIONS, THE APPLICABLE RULES AND
REGULATIONS THEREUNDER AND ANY APPLICABLE RELATED OR SIMILAR RULES, REGULATIONS
OR GUIDELINES, ISSUED, ADMINISTERED OR ENFORCED BY ANY GOVERNMENTAL AGENCY
(COLLECTIVELY, THE “MONEY LAUNDERING LAWS”) AND NO ACTION, SUIT OR PROCEEDING BY
OR BEFORE ANY COURT OR GOVERNMENTAL AGENCY, AUTHORITY OR BODY OR ANY ARBITRATOR
INVOLVING SYMMETRY OR ANY OF THE POST TRANSACTION SUBSIDIARIES WITH RESPECT TO
THE MONEY LAUNDERING LAWS IS PENDING OR, TO THE BEST KNOWLEDGE OF EACH OF
SYMMETRY, THE ISSUER AND HOLDINGS, THREATENED.

 

(KK)                            COMPLIANCE WITH OFAC. NONE OF SYMMETRY OR ANY OF
ITS SUBSIDIARIES OR, TO THE KNOWLEDGE OF EACH OF SYMMETRY, THE ISSUER AND
HOLDINGS, ANY DIRECTOR, OFFICER, AGENT, EMPLOYEE OR AFFILIATE OF SYMMETRY, NSI
OR ANY OF THEIR RESPECTIVE SUBSIDIARIES IS CURRENTLY SUBJECT TO ANY U.S.
SANCTIONS ADMINISTERED BY THE OFFICE OF FOREIGN ASSETS CONTROL OF THE U.S.
DEPARTMENT OF THE TREASURY (“OFAC”); AND THE ISSUER WILL NOT DIRECTLY OR
INDIRECTLY USE THE PROCEEDS OF THE OFFERING OF THE SECURITIES HEREUNDER, OR
LEND, CONTRIBUTE OR OTHERWISE MAKE AVAILABLE SUCH PROCEEDS TO ANY SUBSIDIARY,
JOINT VENTURE PARTNER OR OTHER PERSON OR ENTITY, FOR THE PURPOSE OF FINANCING
THE ACTIVITIES OF ANY PERSON CURRENTLY SUBJECT TO ANY U.S. SANCTIONS
ADMINISTERED BY OFAC.

 

(LL)                                  SOLVENCY. ON AND IMMEDIATELY AFTER THE
CLOSING DATE, EACH OF THE ISSUER AND NOVAMERICAN STEEL (IN EACH CASE AFTER
GIVING EFFECT TO THE ISSUANCE OF THE SECURITIES AND THE OTHER TRANSACTIONS
RELATED THERETO AS DESCRIBED IN EACH OF THE TIME OF SALE INFORMATION AND THE
OFFERING MEMORANDUM) WILL BE SOLVENT. AS USED IN THIS PARAGRAPH, THE TERM
“SOLVENT” MEANS, WITH RESPECT TO A PARTICULAR PERSON ON A PARTICULAR DATE, THAT
ON SUCH DATE:  (I) THE PRESENT FAIR MARKET VALUE (OR PRESENT FAIR SALEABLE
VALUE) OF THE ASSETS OF SUCH PERSON IS NOT LESS THAN THE TOTAL AMOUNT REQUIRED
TO PAY THE LIABILITIES OF SUCH PERSON ON ITS TOTAL EXISTING DEBTS AND
LIABILITIES (INCLUDING CONTINGENT LIABILITIES) AS THEY BECOME ABSOLUTE AND
MATURED; (II) SUCH PERSON IS ABLE TO REALIZE UPON ITS ASSETS AND PAY ITS DEBTS
AND OTHER LIABILITIES, CONTINGENT OBLIGATIONS AND COMMITMENTS AS THEY MATURE AND
BECOME DUE IN THE NORMAL COURSE OF BUSINESS; (III) ASSUMING CONSUMMATION OF THE
ISSUANCE OF THE SECURITIES AS CONTEMPLATED BY THIS AGREEMENT, THE TIME OF SALE
INFORMATION AND THE OFFERING MEMORANDUM, SUCH PERSON IS NOT INCURRING DEBTS OR
LIABILITIES BEYOND ITS ABILITY TO PAY AS SUCH DEBTS AND LIABILITIES MATURE;
(IV) SUCH PERSON IS NOT ENGAGED IN ANY BUSINESS OR TRANSACTION, AND DOES NOT
PROPOSE TO ENGAGE IN ANY BUSINESS OR TRANSACTION, FOR WHICH ITS PROPERTY WOULD
CONSTITUTE UNREASONABLY SMALL CAPITAL AFTER GIVING DUE CONSIDERATION TO THE
PREVAILING PRACTICE IN THE INDUSTRY IN WHICH SUCH PERSON IS ENGAGED; AND
(V) SUCH PERSON IS NOT A DEFENDANT IN ANY CIVIL ACTION THAT WOULD REASONABLY BE
EXPECTED TO RESULT IN A JUDGMENT THAT SUCH PERSON IS OR WOULD BECOME UNABLE TO
SATISFY.

 

(MM)                      NO RESTRICTIONS ON SUBSIDIARIES. EXCEPT FOR (I) ANY
RESTRICTIONS ON THE TRANSFER OF SHARES OF CAPITAL STOCK OR OTHER EQUITY
INTERESTS IN THE ORGANIZATIONAL DOCUMENTS OF 3217928 NOVA SCOTIA COMPANY,
3217930 NOVA SCOTIA COMPANY, 3218088 NOVA SCOTIA COMPANY AND 4421591 OR
(II) RESTRICTIONS OR LIMITATIONS SET FORTH IN THE ORGANIZATIONAL DOCUMENTS OR
RELATED JOINT VENTURE AGREEMENTS OF DELTA TUBE OR TUBES DELTA, UPON THE
CONSUMMATION OF THE TRANSACTIONS, NO SUBSIDIARY OF THE ISSUER WILL BE
PROHIBITED, DIRECTLY OR INDIRECTLY, UNDER ANY AGREEMENT OR OTHER INSTRUMENT TO
WHICH IT IS A PARTY OR IS SUBJECT, FROM PAYING ANY DIVIDENDS TO THE ISSUER, FROM
MAKING ANY OTHER DISTRIBUTION ON SUCH SUBSIDIARY’S CAPITAL STOCK, FROM REPAYING
TO THE ISSUER ANY

 

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LOANS OR ADVANCES TO SUCH SUBSIDIARY FROM THE ISSUER OR FROM TRANSFERRING ANY OF
SUCH SUBSIDIARY’S PROPERTIES OR ASSETS TO THE ISSUER OR ANY OTHER SUBSIDIARY OF
THE ISSUER.

 

(NN)                          NO BROKER’S FEES. NEITHER SYMMETRY NOR ANY OF THE
POST TRANSACTION SUBSIDIARIES IS (OR WILL BE AS OF THE CLOSING DATE, IN THE CASE
OF POST TRANSACTION SUBSIDIARIES THAT WILL BE ORGANIZED, OR ACQUIRED, DIRECTLY
OR INDIRECTLY, BY SYMMETRY, AS PART OF THE TRANSACTIONS) A PARTY TO ANY
CONTRACT, AGREEMENT OR UNDERSTANDING WITH ANY PERSON (OTHER THAN THIS AGREEMENT)
THAT WOULD GIVE RISE TO A VALID CLAIM AGAINST ANY OF THEM OR ANY INITIAL
PURCHASER FOR A BROKERAGE COMMISSION, FINDER’S FEE OR LIKE PAYMENT IN CONNECTION
WITH THE OFFERING AND SALE OF THE SECURITIES.

 

(OO)                          RULE 144A ELIGIBILITY. ON THE CLOSING DATE, THE
SECURITIES WILL NOT BE OF THE SAME CLASS AS SECURITIES LISTED ON A NATIONAL
SECURITIES EXCHANGE REGISTERED UNDER SECTION 6 OF THE EXCHANGE ACT OR QUOTED IN
AN AUTOMATED INTER-DEALER QUOTATION SYSTEM; AND EACH OF THE PRELIMINARY OFFERING
MEMORANDUM AND THE OFFERING MEMORANDUM, AS OF ITS RESPECTIVE DATE, CONTAINS OR
WILL CONTAIN ALL THE INFORMATION THAT, IF REQUESTED BY A PROSPECTIVE PURCHASER
OF THE SECURITIES, WOULD BE REQUIRED TO BE PROVIDED TO SUCH PROSPECTIVE
PURCHASER PURSUANT TO RULE 144A(D)(4) UNDER THE SECURITIES ACT.

 

(PP)                          NO INTEGRATION. NONE OF SYMMETRY, NSI OR ANY OF
THEIR RESPECTIVE AFFILIATES (AS DEFINED IN RULE 501(B) OF REGULATION D) HAS,
DIRECTLY OR THROUGH ANY AGENT, SOLD, OFFERED FOR SALE, SOLICITED OFFERS TO BUY
OR OTHERWISE NEGOTIATED IN RESPECT OF ANY SECURITY (AS DEFINED IN THE SECURITIES
ACT) THAT IS OR WILL BE INTEGRATED WITH THE SALE OF THE SECURITIES IN A MANNER
THAT WOULD REQUIRE REGISTRATION OF THE SECURITIES UNDER THE SECURITIES ACT.

 

(QQ)                          NO GENERAL SOLICITATION OR DIRECTED SELLING
EFFORTS. NONE OF SYMMETRY, NSI OR ANY OF THEIR RESPECTIVE AFFILIATES OR ANY
OTHER PERSON ACTING ON ITS OR THEIR BEHALF (OTHER THAN THE INITIAL PURCHASERS,
AS TO WHICH NO REPRESENTATION IS MADE) HAS (I) SOLICITED OFFERS FOR, OR OFFERED
OR SOLD, THE SECURITIES BY MEANS OF ANY FORM OF GENERAL SOLICITATION OR GENERAL
ADVERTISING WITHIN THE MEANING OF RULE 502(C) OF REGULATION D OR IN ANY MANNER
INVOLVING A PUBLIC OFFERING WITHIN THE MEANING OF SECTION 4(2) OF THE SECURITIES
ACT OR (II) ENGAGED IN ANY DIRECTED SELLING EFFORTS WITH RESPECT TO THE
SECURITIES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT
(“REGULATION S”), AND ALL SUCH PERSONS HAVE COMPLIED WITH THE OFFERING
RESTRICTIONS REQUIREMENT OF REGULATION S.

 

(RR)                                SECURITIES LAW EXEMPTIONS. ASSUMING THE
ACCURACY OF THE REPRESENTATIONS AND WARRANTIES OF THE INITIAL PURCHASERS
CONTAINED IN SECTION 1(B) (INCLUDING ANNEX C HERETO) AND THEIR COMPLIANCE WITH
THEIR AGREEMENTS SET FORTH THEREIN, IT IS NOT NECESSARY, IN CONNECTION WITH THE
ISSUANCE AND SALE OF THE SECURITIES TO THE INITIAL PURCHASERS AND THE OFFER,
RESALE AND DELIVERY OF THE SECURITIES BY THE INITIAL PURCHASERS IN THE MANNER
CONTEMPLATED BY THIS AGREEMENT, THE TIME OF SALE INFORMATION AND THE OFFERING
MEMORANDUM, TO REGISTER THE SECURITIES UNDER THE SECURITIES ACT OR TO QUALIFY
THE INDENTURE UNDER THE TRUST INDENTURE ACT.

 

(SS)                            NO STABILIZATION. NONE OF THE ISSUER, NSI OR ANY
OF THE GUARANTORS HAS TAKEN, DIRECTLY OR INDIRECTLY, ANY ACTION DESIGNED TO OR
THAT COULD REASONABLY BE EXPECTED TO CAUSE OR RESULT IN ANY STABILIZATION OR
MANIPULATION OF THE PRICE OF THE SECURITIES.

 

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(TT)                                MARGIN RULES. NEITHER THE ISSUANCE, SALE AND
DELIVERY OF THE SECURITIES NOR THE APPLICATION OF THE PROCEEDS THEREOF BY THE
ISSUER AS DESCRIBED IN EACH OF THE TIME OF SALE INFORMATION AND THE OFFERING
MEMORANDUM WILL VIOLATE REGULATION T, U OR X OF THE BOARD OF GOVERNORS OF THE
FEDERAL RESERVE SYSTEM OR ANY OTHER REGULATION OF SUCH BOARD OF GOVERNORS.

 

(UU)                          FORWARD-LOOKING STATEMENTS. NO FORWARD-LOOKING
STATEMENT (WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES ACT AND
SECTION 21E OF THE EXCHANGE ACT) CONTAINED IN ANY OF THE TIME OF SALE
INFORMATION OR THE OFFERING MEMORANDUM HAS BEEN MADE OR REAFFIRMED WITHOUT A
REASONABLE BASIS OR HAS BEEN DISCLOSED OTHER THAN IN GOOD FAITH.

 

(VV)                          STATISTICAL AND MARKET DATA. NOTHING HAS COME TO
THE ATTENTION OF SYMMETRY, THE ISSUER OR HOLDINGS THAT HAS CAUSED SYMMETRY, THE
ISSUER OR HOLDINGS TO BELIEVE THAT THE STATISTICAL AND MARKET-RELATED DATA
INCLUDED IN EACH OF THE TIME OF SALE INFORMATION AND THE OFFERING MEMORANDUM IS
NOT BASED ON OR DERIVED FROM SOURCES THAT ARE RELIABLE AND ACCURATE IN ALL
MATERIAL RESPECTS.

 

(WW)                      SARBANES-OXLEY ACT. THERE IS AND HAS BEEN NO FAILURE
ON THE PART OF EITHER SYMMETRY OR NSI OR ANY OF SYMMETRY’S OR NSI’S RESPECTIVE
DIRECTORS OR OFFICERS, IN THEIR CAPACITIES AS SUCH, TO COMPLY IN ANY MATERIAL
RESPECT WITH ANY APPLICABLE PROVISION OF THE SARBANES-OXLEY ACT OF 2002 AND THE
RULES AND REGULATIONS PROMULGATED IN CONNECTION THEREWITH, INCLUDING SECTION 402
RELATED TO LOANS AND SECTIONS 302 AND 906 RELATED TO CERTIFICATIONS.

 

(XX)                              CREATION AND PERFECTION OF SECURITY INTEREST
IN COLLATERAL. (I)  WHEN EXECUTED AND DELIVERED, THE COLLATERAL AGREEMENT WILL
BE EFFECTIVE TO CREATE IN FAVOR OF THE U.S. COLLATERAL AGENT, FOR THE BENEFIT OF
THE SECURED PARTIES, A VALID AND ENFORCEABLE SECURITY INTEREST IN THE COLLATERAL
AND (A) WHEN THE COLLATERAL CONSTITUTING CERTIFICATED SECURITIES (AS DEFINED IN
THE UNIFORM COMMERCIAL CODE (THE “UCC”)) IS DELIVERED TO THE U.S. COLLATERAL
AGENT THEREUNDER, TOGETHER WITH INSTRUMENTS OF TRANSFER DULY ENDORSED IN BLANK,
THE COLLATERAL AGREEMENT WILL CONSTITUTE A FULLY PERFECTED LIEN ON, AND SECURITY
INTEREST IN, ALL RIGHT, TITLE AND INTEREST OF THE PLEDGORS THEREUNDER IN SUCH
COLLATERAL, (1) IN THE CASE OF THE FIRST-PRIORITY COLLATERAL, PRIOR AND SUPERIOR
IN RIGHT TO ANY OTHER PERSON, AND (2) IN THE CASE OF THE SECOND-PRIORITY
COLLATERAL, JUNIOR TO THE FIRST-PRIORITY SECURITY INTEREST OF THE SECURED
PARTIES UNDER THE CREDIT DOCUMENTS, BUT PRIOR AND SUPERIOR IN RIGHT TO ANY OTHER
PERSON, AND (B) WHEN UCC FINANCING STATEMENTS IN APPROPRIATE FORM ARE FILED IN
THE UCC FILING OFFICES SPECIFIED IN THE PERFECTION CERTIFICATE (AS DEFINED
BELOW), THE COLLATERAL AGREEMENT WILL CONSTITUTE A FULLY PERFECTED LIEN ON, AND
SECURITY INTEREST IN, ALL RIGHT, TITLE AND INTEREST OF THE ISSUER AND THE
GUARANTORS IN THE REMAINING COLLATERAL TO THE EXTENT PERFECTION CAN BE OBTAINED
BY FILING UCC FINANCING STATEMENTS, (1) IN THE CASE OF THE FIRST-PRIORITY
COLLATERAL, PRIOR AND SUPERIOR IN RIGHT TO ANY OTHER PERSON, AND (2) IN THE CASE
OF THE SECOND-PRIORITY COLLATERAL, JUNIOR TO THE FIRST-PRIORITY SECURITY
INTEREST OF THE SECURED PARTIES UNDER THE CREDIT DOCUMENTS, BUT PRIOR AND
SUPERIOR IN RIGHT TO ANY OTHER PERSON, EXCEPT, IN THE CASE OF (A) AND (B) ABOVE,
FOR RIGHTS SECURED BY LIENS EXPRESSLY PERMITTED BY THE INDENTURE AND THE
COLLATERAL AGREEMENT.

 

(II)                                 EACH MORTGAGE, UPON EXECUTION AND DELIVERY
BY THE PARTIES THERETO, WILL CREATE IN FAVOR OF THE U.S. COLLATERAL AGENT, FOR
THE BENEFIT OF THE SECURED PARTIES, A LEGAL, VALID AND ENFORCEABLE LIEN ON ALL
THE APPLICABLE MORTGAGOR’S RIGHT, TITLE AND INTEREST IN AND TO THE MORTGAGED
PROPERTIES SUBJECT THERETO AND THE PROCEEDS THEREOF, AND WHEN THE

 

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MORTGAGES HAVE BEEN FILED IN THE JURISDICTIONS SPECIFIED IN
SCHEDULE 3(B) HERETO, THE MORTGAGES WILL CONSTITUTE A FULLY PERFECTED LIEN ON
ALL RIGHT, TITLE AND INTEREST OF THE MORTGAGORS IN THE MORTGAGED PROPERTIES AND
THE PROCEEDS THEREOF, PRIOR AND SUPERIOR IN RIGHT TO ANY OTHER PERSON (BUT
SUBJECT TO LIENS OR OTHER ENCUMBRANCES FOR WHICH EXCEPTIONS ARE TAKEN IN THE
POLICIES OF TITLE INSURANCE DELIVERED IN RESPECT OF THE MORTGAGED PROPERTIES AND
SUBJECT TO LIENS PERMITTED UNDER THE INDENTURE AND THE COLLATERAL AGREEMENT).

 

(YY)                          CREATION AND PERFECTION OF SECURITY INTEREST OR
HYPOTHEC IN INTERCOMPANY NOTE COLLATERAL. (I)  WHEN EXECUTED AND DELIVERED, THE
CANADIAN SECURITY AGREEMENTS WILL BE EFFECTIVE TO CREATE IN FAVOR OF THE
CANADIAN COLLATERAL AGENT, ACTING FOR THE BENEFIT OF THE ISSUER, A VALID AND
ENFORCEABLE SECURITY INTEREST OR HYPOTHEC IN THE INTERCOMPANY NOTE COLLATERAL
(AS DEFINED IN THE PRELIMINARY OFFERING MEMORANDUM) AND (A) WHEN THE
INTERCOMPANY NOTE COLLATERAL CONSTITUTING CERTIFICATED SECURITIES (AS DEFINED IN
THE PERSONAL PROPERTY SECURITY ACT (ONTARIO) (“PPSA”)) IS DELIVERED TO THE
CANADIAN COLLATERAL AGENT (OR THE ADMINISTRATIVE AGENT AS ITS BAILEE FOR
PURPOSES OF PERFECTION), TOGETHER WITH INSTRUMENTS OF TRANSFER DULY ENDORSED IN
BLANK, THE CANADIAN SECURITY AGREEMENTS WILL CONSTITUTE A PERFECTED CHARGE,
SECURITY INTEREST OR HYPOTHEC IN, ALL RIGHT, TITLE AND INTEREST OF NOVAMERICAN
STEEL IN SUCH INTERCOMPANY NOTE COLLATERAL, (1) IN THE CASE OF INTERCOMPANY NOTE
COLLATERAL CONSTITUTING ABL COLLATERAL (AS DEFINED IN THE CREDIT AGREEMENT),
JUNIOR TO THE FIRST-PRIORITY SECURITY INTEREST OR HYPOTHEC OF THE SECURED
PARTIES UNDER THE CREDIT DOCUMENTS, BUT PRIOR AND SUPERIOR IN RIGHT TO ANY OTHER
PERSON, AND (2) IN THE CASE OF ALL OTHER INTERCOMPANY NOTE COLLATERAL, PRIOR AND
SUPERIOR IN RIGHT TO ANY OTHER PERSON, AND (B) WHEN FINANCING STATEMENTS OR
APPLICATIONS FOR REGISTRATION, IN EACH CASE IN APPROPRIATE FORM, ARE FILED IN
THE APPLICABLE PROVINCAL PERSONAL PROPERTY SECURITY REGISTRY OFFICES SPECIFIED
IN THE PERFECTION CERTIFICATE, THE CANADIAN SECURITY AGREEMENTS WILL CONSTITUTE
A PERFECTED CHARGE, SECURITY INTEREST OR HYPOTHEC IN, ALL RIGHT, TITLE AND
INTEREST OF NOVAMERICAN STEEL IN THE REMAINING INTERCOMPANY NOTE COLLATERAL TO
THE EXTENT PERFECTION CAN BE OBTAINED BY FILING PPSA OR OTHER APPLICABLE
PERSONAL PROPERTY SECURITY REGISTRY FINANCING STATEMENTS, (X) IN THE CASE OF
INTERCOMPANY NOTE COLLATERAL CONSTITUTING ABL COLLATERAL (AS DEFINED IN THE
CREDIT AGREEMENT), JUNIOR TO THE FIRST-PRIORITY SECURITY INTEREST OR HYPOTHEC OF
THE SECURED PARTIES UNDER THE CREDIT DOCUMENTS, BUT PRIOR AND SUPERIOR IN RIGHT
TO ANY OTHER PERSON, AND (Y) IN THE CASE OF ALL OTHER INTERCOMPANY NOTE
COLLATERAL, PRIOR AND SUPERIOR IN RIGHT TO ANY OTHER PERSON, IN EACH CASE,
EXCEPT FOR RIGHTS SECURED BY LIENS EXPRESSLY PERMITTED BY THE INDENTURE.

 

(II)                                 SUBJECT TO THE COMPLETION OF THE ONTARIO
PROPERTY TRANSACTIONS (AS DEFINED BELOW), EACH CANADIAN MORTGAGE, UPON EXECUTION
AND DELIVERY BY THE PARTIES THERETO, WILL CREATE IN FAVOR OF THE CANADIAN
COLLATERAL AGENT, ACTING FOR THE BENEFIT OF THE ISSUER, A LEGAL, VALID AND
ENFORCEABLE CHARGE OR HYPOTHEC ON ALL THE APPLICABLE MORTGAGOR’S RIGHT, TITLE
AND INTEREST IN AND TO THE CANADIAN MORTGAGED PROPERTIES SUBJECT THERETO AND THE
PROCEEDS THEREOF, AND WHEN THE CANADIAN MORTGAGES HAVE BEEN REGISTERED IN THE
JURISDICTIONS SPECIFIED IN SCHEDULE 3(D) HERETO, THE CANADIAN MORTGAGES WILL
CONSTITUTE A PERFECTED CHARGE ON ALL RIGHT, TITLE AND INTEREST OF THE MORTGAGORS
IN THE CANADIAN MORTGAGED PROPERTIES AND THE PROCEEDS THEREOF, PRIOR AND
SUPERIOR IN RIGHT TO ANY OTHER PERSON (BUT SUBJECT TO LIENS OR OTHER
ENCUMBRANCES FOR WHICH EXCEPTIONS ARE TAKEN IN THE POLICIES OF TITLE INSURANCE
DELIVERED IN RESPECT OF THE CANADIAN MORTGAGED PROPERTIES AND SUBJECT TO THE
LIENS PERMITTED UNDER THE INDENTURE AND CANADIAN COLLATERAL AGREEMENT).

 

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(III)                               EACH CANADIAN SECURITY AGREEMENT OTHER THAN
THE CANADIAN COLLATERAL AGREEMENT, WHEN EXECUTED AND DELIVERED, WILL BE
EFFECTIVE UNDER APPLICABLE LAW TO CREATE IN FAVOR OF THE CANADIAN COLLATERAL
AGENT, ACTING FOR THE BENEFIT OF THE ISSUER, ITS SUCCESSORS AND ASSIGNS, A VALID
AND ENFORCEABLE SECURITY INTEREST IN OR HYPOTHEC ON THE INTERCOMPANY NOTE
COLLATERAL SUBJECT THERETO, AND, PROVIDED THAT IN THE CASE OF DEEDS OF HYPOTHEC
GOVERNED BY THE LAWS OF QUÉBEC, THE HYPOTHECS CREATED UNDER SUCH DEEDS ARE
REGISTERED IN THE APPROPRIATE REGISTRIES IN THE PROVINCE OF QUÉBEC, AND, FURTHER
PROVIDED THAT IN THE CASE OF MORTGAGES GOVERNED BY THE LAWS OF ONTARIO, SUCH
MORTGAGES HAVE BEEN REGISTERED IN THE APPROPRIATE REGISTRIES IN THE PROVINCE OF
ONTARIO, WILL CONSTITUTE A PERFECTED CHARGE OR HYPOTHEC ON, AND SECURITY
INTEREST IN, ALL RIGHT, TITLE AND INTEREST OF NOVAMERICAN STEEL IN THE
INTERCOMPANY NOTE COLLATERAL SUBJECT THERETO, (A) IN THE CASE OF INTERCOMPANY
NOTE COLLATERAL CONSTITUTING ABL COLLATERAL (AS DEFINED IN THE CREDIT
AGREEMENT), JUNIOR TO THE FIRST-PRIORITY SECURITY INTEREST OF THE SECURED
PARTIES UNDER THE CREDIT DOCUMENTS, BUT PRIOR AND SUPERIOR IN RIGHT TO ANY OTHER
PERSON, AND (B) IN THE CASE OF ALL OTHER INTERCOMPANY NOTE COLLATERAL, PRIOR AND
SUPERIOR IN RIGHT TO ANY OTHER PERSON, IN EACH CASE, EXCEPT FOR RIGHTS SECURED
BY LIENS EXPRESSLY PERMITTED BY THE INDENTURE.

 

4.                                       FURTHER AGREEMENTS OF THE ISSUER AND
THE GUARANTORS. THE ISSUER AND EACH OF THE GUARANTORS JOINTLY AND SEVERALLY
COVENANT AND AGREE WITH EACH INITIAL PURCHASER THAT:

 

(A)                                  DELIVERY OF COPIES. THE ISSUER WILL
DELIVER, WITHOUT CHARGE, TO THE INITIAL PURCHASERS AS MANY COPIES OF THE
PRELIMINARY OFFERING MEMORANDUM, ANY OTHER TIME OF SALE INFORMATION, ANY ISSUER
WRITTEN COMMUNICATION AND THE OFFERING MEMORANDUM (INCLUDING ALL AMENDMENTS AND
SUPPLEMENTS THERETO) AS THE REPRESENTATIVE MAY REASONABLY REQUEST.

 

(B)                                 OFFERING MEMORANDUM, AMENDMENTS OR
SUPPLEMENTS. BEFORE FINALIZING THE OFFERING MEMORANDUM OR MAKING OR DISTRIBUTING
ANY AMENDMENT OR SUPPLEMENT TO ANY OF THE TIME OF SALE INFORMATION OR THE
OFFERING MEMORANDUM, THE ISSUER WILL FURNISH TO THE REPRESENTATIVE AND COUNSEL
FOR THE INITIAL PURCHASERS A COPY OF THE PROPOSED OFFERING MEMORANDUM OR SUCH
AMENDMENT OR SUPPLEMENT FOR REVIEW, AND WILL NOT DISTRIBUTE ANY SUCH PROPOSED
OFFERING MEMORANDUM, AMENDMENT OR SUPPLEMENT TO WHICH THE REPRESENTATIVE
REASONABLY OBJECTS WITHOUT UNREASONABLE DELAY.

 

(C)                                  ADDITIONAL WRITTEN COMMUNICATIONS. BEFORE
MAKING, PREPARING, USING, AUTHORIZING, APPROVING OR REFERRING TO ANY ISSUER
WRITTEN COMMUNICATION, THE ISSUER WILL FURNISH TO THE REPRESENTATIVE AND COUNSEL
FOR THE INITIAL PURCHASERS A COPY OF SUCH WRITTEN COMMUNICATION FOR REVIEW AND
WILL NOT MAKE, PREPARE, USE, AUTHORIZE, APPROVE OR REFER TO ANY SUCH WRITTEN
COMMUNICATION TO WHICH THE REPRESENTATIVE REASONABLY OBJECTS WITHOUT
UNREASONABLE DELAY.

 

(D)                                 NOTICE TO THE REPRESENTATIVE. THE ISSUER
WILL ADVISE THE REPRESENTATIVE PROMPTLY, AND CONFIRM SUCH ADVICE IN WRITING: 
(I) OF THE ISSUANCE BY ANY GOVERNMENTAL OR REGULATORY AUTHORITY OF ANY ORDER
PREVENTING OR SUSPENDING THE USE OF ANY OF THE TIME OF SALE INFORMATION, ANY
ISSUER WRITTEN COMMUNICATION OR THE OFFERING MEMORANDUM OR THE INITIATION OR
THREATENING OF ANY PROCEEDING FOR THAT PURPOSE; (II) OF THE OCCURRENCE OF ANY
EVENT AT ANY TIME PRIOR TO THE COMPLETION OF THE INITIAL OFFERING OF THE
SECURITIES AS A RESULT OF WHICH ANY OF THE TIME OF SALE INFORMATION, ANY ISSUER
WRITTEN COMMUNICATION OR THE OFFERING MEMORANDUM AS THEN AMENDED

 

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OR SUPPLEMENTED WOULD INCLUDE ANY UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT TO
STATE A MATERIAL FACT NECESSARY IN ORDER TO MAKE THE STATEMENTS THEREIN, IN THE
LIGHT OF THE CIRCUMSTANCES EXISTING WHEN SUCH TIME OF SALE INFORMATION, ISSUER
WRITTEN COMMUNICATION OR THE OFFERING MEMORANDUM IS DELIVERED TO A PURCHASER,
NOT MISLEADING; AND (III) OF THE RECEIPT BY THE ISSUER OF ANY NOTICE WITH
RESPECT TO ANY SUSPENSION OF THE QUALIFICATION OF THE SECURITIES FOR OFFER AND
SALE IN ANY JURISDICTION OR THE INITIATION OR THREATENING OF ANY PROCEEDING FOR
SUCH PURPOSE; AND THE ISSUER WILL USE ITS REASONABLE BEST EFFORTS TO PREVENT THE
ISSUANCE OF ANY SUCH ORDER PREVENTING OR SUSPENDING THE USE OF ANY OF THE TIME
OF SALE INFORMATION, ANY ISSUER WRITTEN COMMUNICATION OR THE OFFERING MEMORANDUM
OR SUSPENDING ANY SUCH QUALIFICATION OF THE SECURITIES AND, IF ANY SUCH ORDER IS
ISSUED, WILL OBTAIN AS SOON AS POSSIBLE THE WITHDRAWAL THEREOF.

 

(E)                                  TIME OF SALE INFORMATION. IF AT ANY TIME
PRIOR TO THE CLOSING DATE (I) ANY EVENT SHALL OCCUR OR CONDITION SHALL EXIST AS
A RESULT OF WHICH ANY OF THE TIME OF SALE INFORMATION AS THEN AMENDED OR
SUPPLEMENTED WOULD INCLUDE ANY UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT TO
STATE ANY MATERIAL FACT NECESSARY IN ORDER TO MAKE THE STATEMENTS THEREIN, IN
THE LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT MISLEADING OR
(II) IT IS NECESSARY TO AMEND OR SUPPLEMENT ANY OF THE TIME OF SALE INFORMATION
TO COMPLY WITH LAW, THE ISSUER WILL IMMEDIATELY NOTIFY THE INITIAL PURCHASERS
THEREOF AND FORTHWITH PREPARE AND, SUBJECT TO PARAGRAPH (B) ABOVE, FURNISH TO
THE INITIAL PURCHASERS SUCH AMENDMENTS OR SUPPLEMENTS TO ANY OF THE TIME OF SALE
INFORMATION AS MAY BE NECESSARY SO THAT THE STATEMENTS IN ANY OF THE TIME OF
SALE INFORMATION AS SO AMENDED OR SUPPLEMENTED WILL NOT, IN LIGHT OF THE
CIRCUMSTANCES UNDER WHICH THEY WERE MADE, BE MISLEADING OR SO THAT ANY OF THE
TIME OF SALE INFORMATION WILL COMPLY WITH LAW.

 

(F)                                    ONGOING COMPLIANCE OF THE OFFERING
MEMORANDUM. IF AT ANY TIME PRIOR TO THE COMPLETION OF THE INITIAL OFFERING OF
THE SECURITIES (I) ANY EVENT SHALL OCCUR OR CONDITION SHALL EXIST AS A RESULT OF
WHICH THE OFFERING MEMORANDUM AS THEN AMENDED OR SUPPLEMENTED WOULD INCLUDE ANY
UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT TO STATE ANY MATERIAL FACT NECESSARY
IN ORDER TO MAKE THE STATEMENTS THEREIN, IN THE LIGHT OF THE CIRCUMSTANCES
EXISTING WHEN THE OFFERING MEMORANDUM IS DELIVERED TO A PURCHASER, NOT
MISLEADING OR (II) IT IS NECESSARY TO AMEND OR SUPPLEMENT THE OFFERING
MEMORANDUM TO COMPLY WITH LAW, THE ISSUER WILL IMMEDIATELY NOTIFY THE INITIAL
PURCHASERS THEREOF AND FORTHWITH PREPARE AND, SUBJECT TO PARAGRAPH (B) ABOVE,
FURNISH TO THE INITIAL PURCHASERS SUCH AMENDMENTS OR SUPPLEMENTS TO THE OFFERING
MEMORANDUM AS MAY BE NECESSARY SO THAT THE STATEMENTS IN THE OFFERING MEMORANDUM
AS SO AMENDED OR SUPPLEMENTED WILL NOT, IN THE LIGHT OF THE CIRCUMSTANCES
EXISTING WHEN THE OFFERING MEMORANDUM IS DELIVERED TO A PURCHASER, BE MISLEADING
OR SO THAT THE OFFERING MEMORANDUM WILL COMPLY WITH LAW; PROVIDED, THAT THE
ISSUER MAY REQUEST A DELAY OF UP TO TWENTY-ONE DAYS IN THE REQUIREMENT TO AMEND
OR SUPPLEMENT THE OFFERING MEMORANDUM IF PROCEEDING WITH THE PROPOSED AMENDMENT
OR SUPPLEMENT WOULD REQUIRE THE DISCLOSURE OF MATERIAL NON-PUBLIC INFORMATION
CONCERNING THE ISSUER OR SYMMETRY AND THE DISCLOSURE OF SUCH INFORMATION MIGHT
REASONABLY BE EXPECTED TO ADVERSELY AFFECT A PLANNED TRANSACTION BY THE ISSUER
OR SYMMETRY WHICH IS UNDER ACTIVE CONSIDERATION AND, IN SUCH EVENT, THE INITIAL
PURCHASERS AGREE TO SUSPEND OFFERS AND SALES OF THE SECURITIES UNTIL THE
OFFERING MEMORANDUM IS SO AMENDED OR SUPPLEMENTED BY THE ISSUER.

 

(G)                                 BLUE SKY COMPLIANCE. THE ISSUER WILL USE ITS
REASONABLE BEST EFFORTS TO QUALIFY THE SECURITIES FOR OFFER AND SALE UNDER THE
SECURITIES OR BLUE SKY LAWS OF SUCH JURISDICTIONS AS THE REPRESENTATIVE SHALL
REASONABLY REQUEST AND WILL CONTINUE SUCH QUALIFICATIONS IN EFFECT SO LONG AS
REQUIRED FOR THE OFFERING AND RESALE OF THE SECURITIES; PROVIDED THAT NEITHER
THE ISSUER NOR ANY OF

 

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THE GUARANTORS SHALL BE REQUIRED TO (I) QUALIFY AS A FOREIGN CORPORATION OR
OTHER ENTITY OR AS A DEALER IN SECURITIES IN ANY SUCH JURISDICTION WHERE IT
WOULD NOT OTHERWISE BE REQUIRED TO SO QUALIFY, (II) FILE ANY GENERAL CONSENT TO
SERVICE OF PROCESS IN ANY SUCH JURISDICTION OR (III) SUBJECT ITSELF TO TAXATION
IN ANY SUCH JURISDICTION IF IT IS NOT OTHERWISE SO SUBJECT.

 

(H)                                 CLEAR MARKET. DURING THE PERIOD FROM THE
DATE HEREOF THROUGH AND INCLUDING THE DATE THAT IS 180 DAYS AFTER THE DATE
HEREOF, EACH OF THE ISSUER, SYMMETRY AND HOLDINGS WILL NOT (AND WILL NOT PERMIT
NOVAMERICAN STEEL OR ANY OTHER GUARANTOR TO), WITHOUT THE PRIOR WRITTEN CONSENT
OF THE REPRESENTATIVE, OFFER, SELL, CONTRACT TO SELL OR OTHERWISE DISPOSE OF ANY
DEBT SECURITIES ISSUED OR GUARANTEED BY THE ISSUER, NOVAMERICAN STEEL OR ANY OF
THE GUARANTORS AND HAVING A TENOR OF MORE THAN ONE YEAR.

 

(I)                                     USE OF PROCEEDS. THE ISSUER WILL APPLY
THE NET PROCEEDS FROM THE SALE OF THE SECURITIES AS DESCRIBED IN EACH OF THE
TIME OF SALE INFORMATION AND THE OFFERING MEMORANDUM UNDER THE HEADING “USE OF
PROCEEDS”.

 

(J)                                     SUPPLYING INFORMATION. WHILE THE
SECURITIES REMAIN OUTSTANDING AND ARE “RESTRICTED SECURITIES” WITHIN THE MEANING
OF RULE 144(A)(3) UNDER THE SECURITIES ACT, THE ISSUER AND EACH OF THE
GUARANTORS WILL, DURING ANY PERIOD IN WHICH THE ISSUER IS NOT SUBJECT TO AND IN
COMPLIANCE WITH SECTION 13 OR 15(D) OF THE EXCHANGE ACT, FURNISH TO HOLDERS OF
THE SECURITIES AND PROSPECTIVE PURCHASERS OF THE SECURITIES DESIGNATED BY SUCH
HOLDERS, UPON THE REQUEST OF SUCH HOLDERS OR SUCH PROSPECTIVE PURCHASERS, THE
INFORMATION REQUIRED TO BE DELIVERED PURSUANT TO RULE 144A(D)(4) UNDER THE
SECURITIES ACT.

 

(K)                                  PORTAL AND DTC. THE ISSUER WILL ASSIST THE
INITIAL PURCHASERS IN ARRANGING FOR THE SECURITIES TO BE DESIGNATED PRIVATE
OFFERINGS, RESALES AND TRADING THROUGH AUTOMATED LINKAGES (“PORTAL”) MARKET
SECURITIES IN ACCORDANCE WITH THE RULES AND REGULATIONS ADOPTED BY THE NATIONAL
ASSOCIATION OF SECURITIES DEALERS, INC. (THE “NASD”) RELATING TO TRADING IN THE
PORTAL MARKET AND FOR THE SECURITIES TO BE ELIGIBLE FOR CLEARANCE AND SETTLEMENT
THROUGH THE DEPOSITORY TRUST COMPANY (“DTC”).

 

(L)                                     NO RESALES BY THE ISSUER. THE ISSUER
WILL NOT, AND WILL USE ITS BEST EFFORTS TO CAUSE ITS AFFILIATES (AS DEFINED IN
RULE 144 UNDER THE SECURITIES ACT) NOT TO, RESELL ANY OF THE SECURITIES THAT
HAVE BEEN ACQUIRED BY ANY OF THEM, EXCEPT FOR SECURITIES PURCHASED BY THE ISSUER
OR ANY OF ITS AFFILIATES AND RESOLD IN A TRANSACTION REGISTERED UNDER THE
SECURITIES ACT.

 

(M)                               NO INTEGRATION. NEITHER THE ISSUER NOR ANY OF
ITS AFFILIATES (AS DEFINED IN RULE 501(B) OF REGULATION D) WILL, DIRECTLY OR
THROUGH ANY AGENT, SELL, OFFER FOR SALE, SOLICIT OFFERS TO BUY OR OTHERWISE
NEGOTIATE IN RESPECT OF, ANY SECURITY (AS DEFINED IN THE SECURITIES ACT), THAT
IS OR WILL BE INTEGRATED WITH THE SALE OF THE SECURITIES IN A MANNER THAT WOULD
REQUIRE REGISTRATION OF THE SECURITIES UNDER THE SECURITIES ACT.

 

(N)                                 NO GENERAL SOLICITATION OR DIRECTED SELLING
EFFORTS. NONE OF THE ISSUER OR ANY OF ITS AFFILIATES OR ANY OTHER PERSON ACTING
ON ITS OR THEIR BEHALF (OTHER THAN THE INITIAL PURCHASERS, AS TO WHICH NO
COVENANT IS GIVEN) WILL (I) SOLICIT OFFERS FOR, OR OFFER OR SELL, THE SECURITIES
BY MEANS OF ANY FORM OF GENERAL SOLICITATION OR GENERAL ADVERTISING WITHIN THE
MEANING OF RULE 502(C) OF REGULATION D OR IN ANY MANNER INVOLVING A PUBLIC
OFFERING WITHIN THE MEANING OF SECTION 4(2) OF

 

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THE SECURITIES ACT OR (II) ENGAGE IN ANY DIRECTED SELLING EFFORTS WITHIN THE
MEANING OF REGULATION S, AND ALL SUCH PERSONS WILL COMPLY WITH THE OFFERING
RESTRICTIONS REQUIREMENT OF REGULATION S.

 

(O)                                 NO STABILIZATION. EACH OF THE ISSUER,
SYMMETRY AND HOLDINGS WILL NOT (AND WILL NOT PERMIT NOVAMERICAN STEEL OR ANY
OTHER GUARANTOR TO) TAKE, DIRECTLY OR INDIRECTLY, ANY ACTION DESIGNED TO OR THAT
COULD REASONABLY BE EXPECTED TO CAUSE OR RESULT IN ANY STABILIZATION OR
MANIPULATION OF THE PRICE OF THE SECURITIES.

 

(P)                                 SUBSEQUENT SALE DATES. WITHOUT LIMITING THE
GENERALITY OF CLAUSE (F) ABOVE, IN THE EVENT THAT, FOLLOWING THE CLOSING DATE,
THE INITIAL PURCHASERS CONTINUE TO HOLD AN UNSOLD ALLOTMENT OF THE SECURITIES,
THE ISSUER SHALL, UPON THE REQUEST OF THE INITIAL PURCHASERS AT ANY TIME IN THE
PERIOD FROM THE CLOSING DATE TO DECEMBER 31, 2008 (WHICH REQUEST SHALL BE MADE
NOT MORE THAN TWICE IN SUCH PERIOD), AS PROMPTLY AS REASONABLY PRACTICABLE
FOLLOWING EACH SUCH REQUEST, (I) PROVIDE TO THE INITIAL PURCHASERS A COMPLETE
AMENDED OFFERING MEMORANDUM, UPDATED TO THE DATE PROPOSED FOR RESALE OF THE
SECURITIES IN THE INITIAL PURCHASERS’ REQUEST (EACH SUCH DATE, A “SUBSEQUENT
SALE DATE”), WHICH AMENDED OFFERING MEMORANDUM SHALL INCLUDE ALL CURRENT
FINANCIAL INFORMATION (INCLUDING APPLICABLE PRO FORMA INFORMATION) AND SUCH
OTHER CURRENT DISCLOSURE AS WOULD BE CUSTOMARY FOR A RULE 144A DISCLOSURE
DOCUMENT TO BE DELIVERED ON SUCH SUBSEQUENT SALE DATE AS IF PRICING OF THE
SECURITIES HAD OCCURRED THEREON, (II) PROVIDE OR CAUSE TO BE PROVIDED SUCH
CLOSING DOCUMENTATION ON SUCH SUBSEQUENT SALE DATE AS IS HEREIN CONTEMPLATED TO
BE DELIVERED ON THE CLOSING DATE, INCLUDING, WITHOUT LIMITATION, LEGAL OPINIONS,
CUSTOMARY “COMFORT” LETTERS FROM INDEPENDENT AUDITORS AND CLOSING CERTIFICATES
IN SUBSTANTIALLY THE FORMS CONTEMPLATED HEREBY WITH ONLY SUCH CHANGES THEREIN AS
MAY BE NECESSARY OR APPROPRIATE TO REFLECT THE CURRENT FINANCIAL INFORMATION AND
OTHER UPDATED DISCLOSURE INCLUDED IN THE AMENDED OFFERING MEMORANDUM, OR OTHER
CHANGES IN FACTS AND CIRCUMSTANCES BETWEEN THE CLOSING DATE AND THE APPLICABLE
SUBSEQUENT SALE DATE, (III) REMAKE THE REPRESENTATIONS AND WARRANTIES CONTAINED
HEREIN AS OF SUCH SUBSEQUENT SALE DATE WITH ONLY SUCH CHANGES THEREIN AS MAY BE
NECESSARY OR APPROPRIATE TO REFLECT THE CURRENT FINANCIAL INFORMATION AND OTHER
UPDATED DISCLOSURE INCLUDED IN THE AMENDED OFFERING MEMORANDUM, OR OTHER CHANGES
IN FACTS AND CIRCUMSTANCES BETWEEN THE CLOSING DATE AND THE APPLICABLE
SUBSEQUENT SALE DATE, (IV) REASONABLY COOPERATE WITH THE INITIAL PURCHASERS,
INCLUDING, WITHOUT LIMITATION, PARTICIPATION ON CONFERENCE CALLS WITH THE
INITIAL PURCHASERS AND THEIR COUNSEL, IN CONNECTION WITH THE UPDATING OF THE
INITIAL PURCHASERS’ DUE DILIGENCE INVESTIGATION TO SUCH SUBSEQUENT SALE DATE AND
(V) REASONABLY COOPERATE WITH THE INITIAL PURCHASERS IN CONNECTION WITH THE
MARKETING OF THE SECURITIES, INCLUDING, WITHOUT LIMITATION, THE PARTICIPATION OF
SENIOR MANAGEMENT OF THE ISSUER IN ONE OR MORE MEETINGS WITH PROSPECTIVE
INVESTORS TO WHOM THE INITIAL PURCHASERS PROPOSE TO RESELL THE UNSOLD ALLOTMENT
OF SECURITIES THEN HELD BY THEM. THE ISSUER MAY REQUEST A DELAY OF UP TO
TWENTY-ONE DAYS OF ANY SUBSEQUENT SALE DATE REQUESTED BY THE INITIAL PURCHASERS
IF PROCEEDING WITH THE PROPOSED RESALE OF THE SECURITIES ON THAT DATE IT WOULD
REQUIRE THE DISCLOSURE IN THE AMENDED OFFERING MEMORANDUM OF MATERIAL NON-PUBLIC
INFORMATION CONCERNING THE ISSUER OR SYMMETRY AND THE DISCLOSURE OF SUCH
INFORMATION MIGHT REASONABLY BE EXPECTED TO ADVERSELY AFFECT A PLANNED
TRANSACTION BY THE ISSUER OR SYMMETRY WHICH WAS UNDER ACTIVE CONSIDERATION PRIOR
TO THE DELIVERY BY THE INITIAL PURCHASERS OF THE REQUEST.

 

(Q)                                 ONTARIO PROPERTY TRANSACTIONS. WHEREAS, ON
THE CLOSING DATE, TITLE TO THE CANADIAN MORTGAGED PROPERTY LISTED IN
SCHEDULE 3(C) LOCATED IN STONY CREEK, ONTARIO (THE “ONTARIO PROPERTY”) WILL BE
HELD IN PART BY A WHOLLY-OWNED SUBSIDIARY OF NOVAMERICAN STEEL,

 

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4421591 CANADA INC., A CANADIAN CORPORATION (“4421591”), IT IS AGREED THAT, ON
OR BEFORE 5:00 PM, TORONTO TIME ON THE BUSINESS DAY IMMEDIATELY FOLLOWING THE
CLOSING DATE, SYMMETRY WILL COMPLETE OR CAUSE TO BE COMPLETED THE FOLLOWING
REGISTRATIONS  (THE “ONTARIO PROPERTY TRANSACTIONS”):

 

(i) the registration of a name change application on title to the Ontario
Property to change the registered owner from Nova Steel Processing Centre Ltd.
to Novamerican Steel; and

 

(ii)  the registration of a transfer of title from 4421591 to Novamerican Steel
of all of 4421591’s right, title and interest to the Ontario Property; and

 

(III) THE REGISTRATION OF THE ONTARIO MORTGAGE OVER THE 100% INTEREST OF 
NOVAMERICAN STEEL IN THE ONTARIO PROPERTY.

 

5.                                       CERTAIN AGREEMENTS OF THE INITIAL
PURCHASERS. EACH INITIAL PURCHASER HEREBY REPRESENTS AND AGREES THAT IT HAS NOT
AND WILL NOT USE, AUTHORIZE USE OF, REFER TO, OR PARTICIPATE IN THE PLANNING FOR
USE OF, ANY WRITTEN COMMUNICATION THAT CONSTITUTES AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY THE SECURITIES OTHER THAN (I) THE PRELIMINARY
OFFERING MEMORANDUM AND THE OFFERING MEMORANDUM, (II) A WRITTEN COMMUNICATION
THAT CONTAINS NO “ISSUER INFORMATION” (AS DEFINED IN RULE 433(H)(2) UNDER THE
SECURITIES ACT) THAT WAS NOT INCLUDED (INCLUDING THROUGH INCORPORATION BY
REFERENCE) IN THE PRELIMINARY OFFERING MEMORANDUM OR THE OFFERING MEMORANDUM,
(III) ANY WRITTEN COMMUNICATION LISTED ON ANNEX A OR PREPARED PURSUANT TO
SECTION 4(C) ABOVE (INCLUDING ANY ELECTRONIC ROAD SHOW), (IV) ANY WRITTEN
COMMUNICATION PREPARED BY SUCH INITIAL PURCHASER AND APPROVED BY THE ISSUER IN
ADVANCE IN WRITING OR (V) ANY WRITTEN COMMUNICATION RELATING TO OR THAT CONTAINS
THE TERMS OF THE SECURITIES AND/OR OTHER INFORMATION THAT WAS INCLUDED
(INCLUDING THROUGH INCORPORATION BY REFERENCE) IN THE PRELIMINARY OFFERING
MEMORANDUM OR THE OFFERING MEMORANDUM.

 

6.                                       CONDITIONS OF INITIAL PURCHASERS’
OBLIGATIONS. THE OBLIGATION OF EACH INITIAL PURCHASER TO PURCHASE SECURITIES ON
THE CLOSING DATE AS PROVIDED HEREIN IS SUBJECT TO THE PERFORMANCE BY THE ISSUER,
NOVAMERICAN STEEL AND EACH OF THE GUARANTORS OF THEIR RESPECTIVE COVENANTS AND
OTHER OBLIGATIONS HEREUNDER AND TO THE FOLLOWING ADDITIONAL CONDITIONS:

 

(A)                                  REPRESENTATIONS AND WARRANTIES. THE
REPRESENTATIONS AND WARRANTIES OF THE ISSUER, NOVAMERICAN STEEL AND THE
GUARANTORS CONTAINED HEREIN (OR IN THE JOINDER AGREEMENT, AS THE CASE MAY BE)
SHALL BE TRUE AND CORRECT ON THE DATE HEREOF AND ON AND AS OF THE CLOSING DATE;
AND THE STATEMENTS OF THE ISSUER, NOVAMERICAN STEEL AND THE GUARANTORS AND THEIR
RESPECTIVE OFFICERS MADE IN ANY CERTIFICATES DELIVERED PURSUANT TO THE NOTE
DOCUMENTS SHALL BE TRUE AND CORRECT ON AND AS OF THE CLOSING DATE.

 

(B)                                 NO DOWNGRADE. SUBSEQUENT TO THE EARLIER OF
(A) THE TIME OF SALE AND (B) THE EXECUTION AND DELIVERY OF THIS AGREEMENT:  
(I) NO DOWNGRADING SHALL HAVE OCCURRED IN THE RATING ACCORDED THE SECURITIES OR
ANY OTHER DEBT SECURITIES OR PREFERRED STOCK ISSUED OR GUARANTEED BY SYMMETRY OR
ANY OF THE POST TRANSACTION SUBSIDIARIES BY ANY “NATIONALLY RECOGNIZED
STATISTICAL RATING ORGANIZATION”, AS SUCH TERM IS DEFINED BY THE COMMISSION FOR
PURPOSES OF RULE 436(G)(2) UNDER THE SECURITIES ACT; AND (II) NO SUCH
ORGANIZATION SHALL HAVE PUBLICLY ANNOUNCED THAT IT HAS UNDER SURVEILLANCE OR
REVIEW, OR HAS CHANGED ITS OUTLOOK WITH RESPECT TO, ITS RATING OF THE

 

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SECURITIES OR OF ANY OTHER DEBT SECURITIES OR PREFERRED STOCK ISSUED OR
GUARANTEED BY SYMMETRY OR ANY OF THE POST TRANSACTION SUBSIDIARIES (OTHER THAN
AN ANNOUNCEMENT WITH POSITIVE IMPLICATIONS OF A POSSIBLE UPGRADING).

 

(C)                                  NO MATERIAL ADVERSE CHANGE. NO EVENT OR
CONDITION OF A TYPE DESCRIBED IN SECTION 3(D) HEREOF SHALL HAVE OCCURRED OR
SHALL EXIST, WHICH EVENT OR CONDITION IS NOT DESCRIBED IN EACH OF THE TIME OF
SALE INFORMATION (EXCLUDING ANY AMENDMENT OR SUPPLEMENT THERETO) AND THE
OFFERING MEMORANDUM (EXCLUDING ANY AMENDMENT OR SUPPLEMENT THERETO) THE EFFECT
OF WHICH IN THE JUDGMENT OF THE REPRESENTATIVE MAKES IT IMPRACTICABLE OR
INADVISABLE TO PROCEED WITH THE OFFERING, SALE OR DELIVERY OF THE SECURITIES ON
THE TERMS AND IN THE MANNER CONTEMPLATED BY THIS AGREEMENT, THE TIME OF SALE
INFORMATION AND THE OFFERING MEMORANDUM.

 

(D)                                 OFFICERS’ CERTIFICATE. THE REPRESENTATIVE
SHALL HAVE RECEIVED ON AND AS OF THE CLOSING DATE A CERTIFICATE OF AN EXECUTIVE
OFFICER OF EACH OF THE ISSUER, NOVAMERICAN STEEL AND THE GUARANTORS WHO HAS
SPECIFIC KNOWLEDGE OF THE FINANCIAL MATTERS OF THE ISSUER, NOVAMERICAN STEEL AND
THE GUARANTORS, AS APPLICABLE, AND IS SATISFACTORY TO THE REPRESENTATIVE
(I) CONFIRMING THAT SUCH OFFICER HAS CAREFULLY REVIEWED THE TIME OF SALE
INFORMATION AND THE OFFERING MEMORANDUM AND, TO THE BEST KNOWLEDGE OF SUCH
OFFICER, THE REPRESENTATIONS SET FORTH IN SECTIONS 3(A) AND 3(B) HEREOF ARE TRUE
AND CORRECT, (II) CONFIRMING THAT THE OTHER REPRESENTATIONS AND WARRANTIES OF
THE ISSUER, NOVAMERICAN STEEL AND THE GUARANTORS IN THIS AGREEMENT (OR IN THE
JOINDER AGREEMENT, AS THE CASE MAY BE) ARE TRUE AND CORRECT AND THAT THE ISSUER
AND THE GUARANTORS HAVE COMPLIED WITH ALL AGREEMENTS AND SATISFIED ALL
CONDITIONS ON THEIR PART TO BE PERFORMED OR SATISFIED HEREUNDER AT OR PRIOR TO
THE CLOSING DATE AND (III) TO THE EFFECT SET FORTH IN PARAGRAPHS (B) AND
(C) ABOVE.

 

(E)                                  COMFORT LETTERS. ON THE DATE OF THIS
AGREEMENT AND ON THE CLOSING DATE, EACH OF RAYMOND CHABOT GRANT THORNTON LLP AND
MILLER, ELLIN & COMPANY, LLP SHALL HAVE FURNISHED TO THE REPRESENTATIVE, AT THE
REQUEST OF NSI AND SYMMETRY, RESPECTIVELY, LETTERS, DATED THE RESPECTIVE DATES
OF DELIVERY THEREOF AND ADDRESSED TO THE INITIAL PURCHASERS, IN FORM AND
SUBSTANCE REASONABLY SATISFACTORY TO THE REPRESENTATIVE, CONTAINING STATEMENTS
AND INFORMATION OF THE TYPE CUSTOMARILY INCLUDED IN ACCOUNTANTS’ “COMFORT
LETTERS” TO UNDERWRITERS WITH RESPECT TO THE FINANCIAL STATEMENTS AND CERTAIN
FINANCIAL INFORMATION CONTAINED IN EACH OF THE TIME OF SALE INFORMATION AND THE
OFFERING MEMORANDUM; PROVIDED THAT THE LETTER DELIVERED ON THE CLOSING DATE
SHALL USE A “CUT-OFF” DATE NO MORE THAN THREE BUSINESS DAYS PRIOR TO THE CLOSING
DATE.

 

(F)                                    OPINION AND 10B-5 STATEMENT OF COUNSEL
FOR THE ISSUER. KELLEY DRYE & WARREN LLP, COUNSEL FOR THE ISSUER, SHALL HAVE
FURNISHED TO THE REPRESENTATIVE, AT THE REQUEST OF THE ISSUER, THEIR WRITTEN
OPINION AND 10B-5 STATEMENT, DATED THE CLOSING DATE AND ADDRESSED TO THE INITIAL
PURCHASERS, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE REPRESENTATIVE,
TO THE EFFECT SET FORTH IN ANNEX D-1 HERETO.

 

(G)                                 OPINION AND 10B-5 STATEMENT OF COUNSEL FOR
THE INITIAL PURCHASERS. THE REPRESENTATIVE SHALL HAVE RECEIVED ON AND AS OF THE
CLOSING DATE AN OPINION AND 10B-5 STATEMENT OF CRAVATH, SWAINE & MOORE LLP,
COUNSEL FOR THE INITIAL PURCHASERS, WITH RESPECT TO SUCH MATTERS AS THE
REPRESENTATIVE MAY REASONABLY REQUEST, AND SUCH COUNSEL SHALL HAVE RECEIVED SUCH
DOCUMENTS AND INFORMATION AS THEY MAY REASONABLY REQUEST TO ENABLE THEM TO PASS
UPON SUCH MATTERS.

 

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(H)                                 OPINIONS OF LOCAL COUNSEL. (I)  DAVIES WARD
PHILLIPS & VINEBERG LLP, CANADIAN COUNSEL FOR SYMMETRY, SHALL HAVE FURNISHED TO
THE REPRESENTATIVE, AT THE REQUEST OF NOVAMERICAN STEEL, THEIR WRITTEN OPINION,
DATED THE CLOSING DATE AND ADDRESSED TO THE INITIAL PURCHASERS, IN FORM AND
SUBSTANCE REASONABLY SATISFACTORY TO THE REPRESENTATIVE, TO THE EFFECT SET FORTH
IN ANNEX D-2 HERETO; (II) STEWART MCKELVEY, NEW BRUNSWICK COUNSEL FOR CAN SUB 1
AND CAN SUB 2, SHALL HAVE FURNISHED TO THE REPRESENTATIVE, AT THE REQUEST OF
NOVAMERICAN STEEL, THEIR WRITTEN OPINION, DATED THE CLOSING DATE AND ADDRESSED
TO THE INITIAL PURCHASERS, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE
REPRESENTATIVE, TO THE EFFECT SET FORTH IN ANNEX D-2 HERETO; AND (III) NUTTER,
MCCLENNEN & FISH, LLP, MASSACHUSETTS COUNSEL FOR AMERICAN STEEL AND ALUMINUM
CORPORATION, A MASSACHUSETTS CORPORATION, SHALL HAVE FURNISHED TO THE
REPRESENTATIVE, AT THE REQUEST OF SYMMETRY, THEIR WRITTEN OPINION, DATED THE
CLOSING DATE AND ADDRESSED TO THE INITIAL PURCHASERS, IN FORM AND SUBSTANCE
REASONABLY SATISFACTORY TO THE REPRESENTATIVE, TO THE EFFECT SET FORTH IN ANNEX
D-3 HERETO.

 

(I)                                     NO LEGAL IMPEDIMENT TO ISSUANCE. NO
ACTION SHALL HAVE BEEN TAKEN AND NO STATUTE, RULE, REGULATION OR ORDER SHALL
HAVE BEEN ENACTED, ADOPTED OR ISSUED BY ANY FEDERAL, STATE OR FOREIGN
GOVERNMENTAL OR REGULATORY AUTHORITY THAT WOULD, AS OF THE CLOSING DATE, PREVENT
THE ISSUANCE OR SALE OF THE SECURITIES OR THE ISSUANCE OF THE GUARANTEES; AND NO
INJUNCTION OR ORDER OF ANY FEDERAL, STATE OR FOREIGN COURT SHALL HAVE BEEN
ISSUED THAT WOULD, AS OF THE CLOSING DATE, PREVENT THE ISSUANCE OR SALE OF THE
SECURITIES OR THE ISSUANCE OF THE GUARANTEES.

 

(J)                                     GOOD STANDING. THE REPRESENTATIVE SHALL
HAVE RECEIVED ON AND AS OF THE CLOSING DATE SATISFACTORY EVIDENCE OF THE GOOD
STANDING OF SYMMETRY AND THE POST TRANSACTION SUBSIDIARIES IN THEIR RESPECTIVE
JURISDICTIONS OF ORGANIZATION AND THEIR GOOD STANDING IN SUCH OTHER
JURISDICTIONS AS THE REPRESENTATIVE MAY REASONABLY REQUEST, IN EACH CASE IN
WRITING OR ANY STANDARD FORM OF TELECOMMUNICATION, FROM THE APPROPRIATE
GOVERNMENTAL AUTHORITIES OF SUCH JURISDICTIONS, EXCEPT FOR (I) THE CERTIFICATE
OF COMPLIANCE OF NOVAMERICAN STEEL AND (II) THE CERTIFICAT D’ATTESTATION FOR
NOVAMERICAN STEEL’S REGISTRATION IN QUEBEC, WHICH, IN EACH CASE, SHALL BE
RECEIVED ON THE DAY IMMEDIATELY FOLLOWING THE CLOSING DATE.

 

(K)                                  PORTAL AND DTC. THE SECURITIES SHALL HAVE
BEEN APPROVED BY THE NASD FOR TRADING IN THE PORTAL MARKET AND SHALL BE ELIGIBLE
FOR CLEARANCE AND SETTLEMENT THROUGH DTC.

 

(L)                                     ADDITIONAL DOCUMENTS. ON OR PRIOR TO THE
CLOSING DATE, THE ISSUER, NOVAMERICAN STEEL AND THE GUARANTORS SHALL HAVE
FURNISHED TO THE REPRESENTATIVE SUCH FURTHER CERTIFICATES AND DOCUMENTS AS THE
REPRESENTATIVE MAY REASONABLY REQUEST.

 

(M)                               TRANSACTIONS. THE TRANSACTIONS SHALL HAVE BEEN
CONSUMMATED ON THE TERMS AND CONDITIONS DESCRIBED IN THE TIME OF SALE
INFORMATION AND THE OFFERING MEMORANDUM.

 

(N)                                 JOINDER. EACH OF THE JOINING PARTIES SHALL
HAVE BECOME PARTIES TO THIS AGREEMENT PURSUANT TO THE EXECUTION AND DELIVERY OF
THE JOINDER AGREEMENT.

 

(O)                                 REGISTRATION RIGHTS AGREEMENT. THE INITIAL
PURCHASERS SHALL HAVE RECEIVED A COUNTERPART OF THE REGISTRATION RIGHTS
AGREEMENT THAT SHALL HAVE BEEN EXECUTED AND DELIVERED BY A DULY AUTHORIZED
OFFICER OF THE ISSUER AND EACH OF THE GUARANTORS.

 

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(P)                                 CREATION AND PERFECTION OF SECURITY INTEREST
IN COLLATERAL. (I)  THE REPRESENTATIVE AND THE U.S. COLLATERAL AGENT SHALL HAVE
RECEIVED FROM THE ISSUER AND EACH GUARANTOR COUNTERPARTS OF THE COLLATERAL
AGREEMENT AND OF THE INTERCREDITOR AGREEMENT, DULY EXECUTED AND DELIVERED ON
BEHALF OF THE ISSUER OR SUCH GUARANTOR, AS APPLICABLE.

 

(II)                                  ALL EQUITY INTERESTS IN ANY SUBSIDIARY
OWNED BY OR ON BEHALF OF THE ISSUER OR ANY OF THE GUARANTORS SHALL HAVE BEEN
PLEDGED PURSUANT TO THE COLLATERAL AGREEMENT AND THE U.S. COLLATERAL AGENT SHALL
HAVE RECEIVED CERTIFICATES OR OTHER INSTRUMENTS REPRESENTING ALL SUCH EQUITY
INTERESTS, TOGETHER WITH UNDATED STOCK POWERS OR OTHER INSTRUMENTS OF TRANSFER
WITH RESPECT THERETO ENDORSED IN BLANK, IN EACH CASE TO THE EXTENT REQUIRED BY
THE INDENTURE.

 

(III)                               ALL INDEBTEDNESS OF SYMMETRY AND THE POST
TRANSACTION SUBSIDIARIES THAT IS OWING TO THE ISSUER OR ANY GUARANTOR SHALL BE
EVIDENCED BY A PROMISSORY NOTE AND SHALL HAVE BEEN PLEDGED PURSUANT TO THE
COLLATERAL AGREEMENT AND THE U.S. COLLATERAL AGENT SHALL HAVE RECEIVED ALL SUCH
PROMISSORY NOTES, TOGETHER WITH INSTRUMENTS OF TRANSFER WITH RESPECT THERETO
ENDORSED IN BLANK, IN EACH CASE TO THE EXTENT REQUIRED BY THE INDENTURE.

 

(IV)                              ALL DOCUMENTS AND INSTRUMENTS, INCLUDING UCC
FINANCING STATEMENTS, REQUIRED BY LAW OR REASONABLY REQUESTED BY THE
REPRESENTATIVE OR THE COLLATERAL AGENTS TO BE FILED, REGISTERED OR RECORDED TO
CREATE THE LIENS INTENDED TO BE CREATED BY THE COLLATERAL AGREEMENT AND PERFECT
SUCH LIENS TO THE EXTENT REQUIRED BY, AND WITH THE PRIORITY REQUIRED BY, THE
COLLATERAL AGREEMENT, SHALL HAVE BEEN FILED, REGISTERED OR RECORDED OR DELIVERED
TO THE U.S. COLLATERAL AGENT FOR FILING, REGISTRATION OR RECORDING, IN EACH CASE
TO THE EXTENT REQUIRED BY THE INDENTURE.

 

(V)                                 EACH OF THE ISSUER AND THE GUARANTORS SHALL
HAVE OBTAINED ALL MATERIAL CONSENTS AND APPROVALS REQUIRED TO BE OBTAINED BY IT
IN CONNECTION WITH THE EXECUTION AND DELIVERY OF THE COLLATERAL AGREEMENT, THE
PERFORMANCE OF ITS OBLIGATIONS THEREUNDER AND THE GRANTING BY IT OF THE LIENS
THEREUNDER.

 

(VI)                              ALL FILING FEES, TAXES AND OTHER AMOUNTS
PAYABLE IN CONNECTION WITH THE FILINGS, RECORDINGS, REGISTRATIONS AND OTHER
ACTIONS DESCRIBED IN CLAUSES (I) THROUGH (VI) ABOVE SHALL HAVE BEEN PAID OR
PAYMENT BY THE ISSUER PROVIDED FOR TO THE REASONABLE SATISFACTION OF THE
REPRESENTATIVE AND THE U.S. COLLATERAL AGENT.

 

(Q)                                 CREATION AND PERFECTION OF SECURITY INTEREST
OR HYPOTHEC IN INTERCOMPANY NOTE COLLATERAL. (I)  THE REPRESENTATIVE SHALL HAVE
RECEIVED FROM THE CANADIAN COLLATERAL AGENT AND NOVAMERICAN STEEL COUNTERPARTS
OF THE CANADIAN SECURITY AGREEMENTS, DULY EXECUTED AND DELIVERED BY THE CANADIAN
COLLATERAL AGENT ON BEHALF OF THE ISSUER OR NOVAMERICAN STEEL, AS APPLICABLE.

 

(II)                                  ALL EQUITY INTERESTS IN ANY SUBSIDIARY
OWNED BY OR ON BEHALF OF NOVAMERICAN STEEL SHALL HAVE BEEN PLEDGED PURSUANT TO
THE CANADIAN COLLATERAL AGREEMENT AND, IF CERTIFICATED, THE CANADIAN COLLATERAL
AGENT FOR THE BENEFIT OF THE ISSUER (OR THE CANADIAN COLLATERAL AGENT AS ITS
BAILEE FOR PURPOSES OF PERFECTION) SHALL HAVE RECEIVED CERTIFICATES OR OTHER
INSTRUMENTS REPRESENTING ALL SUCH EQUITY INTERESTS, TOGETHER

 

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WITH UNDATED STOCK POWERS OR OTHER INSTRUMENTS OF TRANSFER WITH RESPECT THERETO
ENDORSED IN BLANK, IN EACH CASE TO THE EXTENT REQUIRED THEREBY.

 

(III)                               ALL INDEBTEDNESS OF SYMMETRY AND POST
TRANSACTION SUBSIDIARIES THAT IS OWING TO NOVAMERICAN STEEL SHALL BE EVIDENCED
BY A PROMISSORY NOTE OR PROMISSORY NOTES AND SHALL HAVE BEEN PLEDGED PURSUANT TO
THE CANADIAN COLLATERAL AGREEMENT AND CANADIAN COLLATERAL AGENT FOR THE BENEFIT
OF THE ISSUER SHALL HAVE RECEIVED ALL SUCH PROMISSORY NOTES, TOGETHER WITH
INSTRUMENTS OF TRANSFER WITH RESPECT THERETO ENDORSED IN BLANK, IN EACH CASE TO
THE EXTENT REQUIRED THEREBY.

 

(IV)                              ALL DOCUMENTS AND INSTRUMENTS, INCLUDING PPSA
OR OTHER PERSONAL PROPERTY SECURITY REGISTRY FINANCING STATEMENTS OR
APPLICATIONS FOR REGISTRATION, REQUIRED BY LAW TO BE FILED, REGISTERED OR
RECORDED TO CREATE THE LIENS INTENDED TO BE CREATED BY THE CANADIAN SECURITY
AGREEMENTS AND PERFECT SUCH LIENS TO THE EXTENT REQUIRED BY, AND WITH THE
PRIORITY REQUIRED BY, THE CANADIAN SECURITY AGREEMENTS, SHALL HAVE BEEN FILED,
REGISTERED OR RECORDED OR DELIVERED TO THE CANADIAN COLLATERAL AGENT FOR THE
BENEFIT OF THE ISSUER FOR FILING, REGISTRATION OR RECORDING.

 

(V)                                 EACH OF THE ISSUER AND NOVAMERICAN STEEL
SHALL HAVE OBTAINED ALL MATERIAL CONSENTS AND APPROVALS REQUIRED TO BE OBTAINED
BY IT IN CONNECTION WITH THE EXECUTION AND DELIVERY OF ALL CANADIAN SECURITY
AGREEMENTS TO WHICH IT IS A PARTY, THE PERFORMANCE OF ITS OBLIGATIONS THEREUNDER
AND THE GRANTING BY IT OF THE LIENS THEREUNDER.

 

(VI)                              THE ISSUER SHALL HAVE RECEIVED
(A) COUNTERPARTS OF A CANADIAN MORTGAGE WITH RESPECT TO EACH CANADIAN MORTGAGED
PROPERTY DULY EXECUTED AND DELIVERED BY THE REGISTERED OWNER OF SUCH CANADIAN
MORTGAGED PROPERTY, (B) A POLICY OR POLICIES OF TITLE INSURANCE BY A NATIONALLY
RECOGNIZED TITLE INSURANCE COMPANY INSURING THE CHARGE OF EACH SUCH CANADIAN
MORTGAGED PROPERTY AS A VALID FIRST-PRIORITY CHARGE ON THE CANADIAN MORTGAGED
PROPERTY DESCRIBED THEREIN, FREE OF ANY OTHER ENCUMBRANCES (BUT SUBJECT TO LIENS
OR OTHER ENCUMBRANCES FOR WHICH EXCEPTIONS ARE TAKEN IN THE POLICIES OF TITLE
INSURANCE DELIVERED IN RESPECT OF THE CANADIAN MORTGAGED PROPERTIES AND SUBJECT
TO LIENS PERMITTED UNDER THE INDENTURE AND THE CANADIAN COLLATERAL AGREEMENT),
TOGETHER WITH SUCH ENDORSEMENTS, COINSURANCE AND REINSURANCE AS THE ISSUER
MAY REASONABLY REQUEST, AND (C) SUCH SURVEYS, ABSTRACTS, APPRAISALS, LEGAL
OPINIONS AND OTHER DOCUMENTS AS THE ISSUER MAY REASONABLY REQUEST WITH RESPECT
TO ANY SUCH CANADIAN MORTGAGE OR CANADIAN MORTGAGED PROPERTY.

 

(VII)                           ALL FILING FEES, TAXES AND OTHER AMOUNTS PAYABLE
IN CONNECTION WITH THE FILINGS, RECORDINGS, REGISTRATIONS AND OTHER ACTIONS
DESCRIBED IN CLAUSES (I) THROUGH (VI) ABOVE SHALL HAVE BEEN PAID OR PAYMENT BY
NOVAMERICAN STEEL PROVIDED FOR TO THE REASONABLE SATISFACTION OF THE
REPRESENTATIVE AND THE CANADIAN COLLATERAL AGENT.

 

(R)                                    PERFECTION CERTIFICATE. ON OR PRIOR TO
THE CLOSING DATE, THE REPRESENTATIVE SHALL HAVE RECEIVED (I) A COMPLETED
PERFECTION CERTIFICATE IN THE FORM ATTACHED TO THE COLLATERAL AGREEMENT TO BE
DATED AS OF THE CLOSING DATE (THE “PERFECTION CERTIFICATE”), EXECUTED BY AN
EXECUTIVE OFFICER OF SYMMETRY, THE ISSUER AND NOVAMERICAN STEEL, TOGETHER WITH
ALL ATTACHMENTS CONTEMPLATED THEREBY, WHICH SHALL BE CORRECT AND COMPLETE AS OF
THE CLOSING DATE, AND (II) THE

 

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RESULTS OF LIEN SEARCHES, CONDUCTED BY A SEARCH SERVICE REASONABLY SATISFACTORY
TO THE REPRESENTATIVE, AND THE REPRESENTATIVE SHALL BE SATISFIED THAT NO LIENS
ARE OUTSTANDING ON THE PROPERTY OR ASSETS OF THE ISSUER, NOVAMERICAN STEEL OR
ANY OF THE GUARANTORS, OTHER THAN ANY SUCH LIENS (A) WHICH CONSTITUTE PERMITTED
LIENS (AS DEFINED IN THE INDENTURE) OR (B) AS TO WHICH THE INITIAL PURCHASERS
HAVE RECEIVED DOCUMENTATION REASONABLY SATISFACTORY TO IT EVIDENCING THE
TERMINATION OF SUCH LIENS.

 

All opinions, letters, certificates and evidence mentioned above or elsewhere in
this Agreement shall be deemed to be in compliance with the provisions hereof
only if they are in form and substance reasonably satisfactory to counsel for
the Initial Purchasers.

 

7.                                       INDEMNIFICATION AND CONTRIBUTION.

 

(A)                                  INDEMNIFICATION OF THE INITIAL PURCHASERS.
THE ISSUER AND EACH OF THE GUARANTORS JOINTLY AND SEVERALLY AGREE TO INDEMNIFY
AND HOLD HARMLESS EACH INITIAL PURCHASER, ITS AFFILIATES, DIRECTORS AND OFFICERS
AND EACH PERSON, IF ANY, WHO CONTROLS SUCH INITIAL PURCHASER WITHIN THE MEANING
OF SECTION 15 OF THE SECURITIES ACT OR SECTION 20 OF THE EXCHANGE ACT, FROM AND
AGAINST ANY AND ALL LOSSES, CLAIMS, DAMAGES AND LIABILITIES (INCLUDING, WITHOUT
LIMITATION, LEGAL FEES AND OTHER EXPENSES REASONABLY INCURRED IN CONNECTION WITH
ANY SUIT, ACTION OR PROCEEDING OR ANY CLAIM ASSERTED, AS SUCH FEES AND EXPENSES
ARE INCURRED), JOINT OR SEVERAL, THAT ARISE OUT OF, OR ARE BASED UPON, ANY
UNTRUE STATEMENT OR ALLEGED UNTRUE STATEMENT OF A MATERIAL FACT CONTAINED IN THE
PRELIMINARY OFFERING MEMORANDUM, ANY OF THE OTHER TIME OF SALE INFORMATION, ANY
ISSUER WRITTEN COMMUNICATION OR THE OFFERING MEMORANDUM (OR ANY AMENDMENT OR
SUPPLEMENT THERETO) OR ANY OMISSION OR ALLEGED OMISSION TO STATE THEREIN A
MATERIAL FACT NECESSARY IN ORDER TO MAKE THE STATEMENTS THEREIN, IN THE LIGHT OF
THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT MISLEADING, IN EACH CASE
EXCEPT INSOFAR AS SUCH LOSSES, CLAIMS, DAMAGES OR LIABILITIES ARISE OUT OF, OR
ARE BASED UPON, ANY UNTRUE STATEMENT OR OMISSION OR ALLEGED UNTRUE STATEMENT OR
OMISSION MADE IN RELIANCE UPON AND IN CONFORMITY WITH ANY INFORMATION RELATING
TO ANY INITIAL PURCHASER FURNISHED TO THE ISSUER IN WRITING BY SUCH INITIAL
PURCHASER THROUGH THE REPRESENTATIVE EXPRESSLY FOR USE THEREIN.

 

(B)                                 INDEMNIFICATION OF THE ISSUER. EACH INITIAL
PURCHASER AGREES, SEVERALLY AND NOT JOINTLY, TO INDEMNIFY AND HOLD HARMLESS THE
ISSUER, EACH OF THE GUARANTORS, EACH OF THEIR RESPECTIVE DIRECTORS AND OFFICERS
AND EACH PERSON, IF ANY, WHO CONTROLS THE ISSUER OR ANY OF THE GUARANTORS WITHIN
THE MEANING OF SECTION 15 OF THE SECURITIES ACT OR SECTION 20 OF THE EXCHANGE
ACT TO THE SAME EXTENT AS THE INDEMNITY SET FORTH IN PARAGRAPH (A) ABOVE, BUT
ONLY WITH RESPECT TO ANY LOSSES, CLAIMS, DAMAGES OR LIABILITIES THAT ARISE OUT
OF, OR ARE BASED UPON, ANY UNTRUE STATEMENT OR OMISSION OR ALLEGED UNTRUE
STATEMENT OR OMISSION MADE IN RELIANCE UPON AND IN CONFORMITY WITH ANY
INFORMATION RELATING TO SUCH INITIAL PURCHASER FURNISHED TO THE ISSUER IN
WRITING BY SUCH INITIAL PURCHASER THROUGH THE REPRESENTATIVE EXPRESSLY FOR USE
IN THE PRELIMINARY OFFERING MEMORANDUM, ANY OF THE OTHER TIME OF SALE
INFORMATION, ANY ISSUER WRITTEN COMMUNICATION OR THE OFFERING MEMORANDUM (OR ANY
AMENDMENT OR SUPPLEMENT THERETO), IT BEING UNDERSTOOD AND AGREED THAT THE ONLY
SUCH INFORMATION CONSISTS OF THE FOLLOWING: THE FIFTH AND SIXTH SENTENCES OF THE
TENTH PARAGRAPH AND THE FIRST AND LAST SENTENCES OF THE TWELFTH PARAGRAPH UNDER
THE CAPTION “PLAN OF DISTRIBUTION” IN THE PRELIMINARY OFFERING MEMORANDUM;
PROVIDED THAT NONE OF THE INITIAL PURCHASERS SHALL HAVE ANY OBLIGATIONS PURSUANT
TO THIS PARAGRAPH (B) WITH RESPECT TO ANY GUARANTOR THAT IS A JOINING PARTY, ITS
AFFILIATES, DIRECTORS AND EACH PERSON,

 

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IF ANY, WHO CONTROLS SUCH GUARANTOR UNTIL THE JOINDER AGREEMENT IS EXECUTED AND
DELIVERED PURSUANT TO SECTION 6(N) HEREOF.

 

(C)                                  NOTICE AND PROCEDURES. IF ANY SUIT, ACTION,
PROCEEDING (INCLUDING ANY GOVERNMENTAL OR REGULATORY INVESTIGATION), CLAIM OR
DEMAND SHALL BE BROUGHT OR ASSERTED AGAINST ANY PERSON IN RESPECT OF WHICH
INDEMNIFICATION MAY BE SOUGHT PURSUANT TO EITHER PARAGRAPH (A) OR (B) ABOVE,
SUCH PERSON (THE “INDEMNIFIED PERSON”) SHALL PROMPTLY NOTIFY THE PERSON AGAINST
WHOM SUCH INDEMNIFICATION MAY BE SOUGHT (THE “INDEMNIFYING PERSON”) IN WRITING;
PROVIDED THAT THE FAILURE TO NOTIFY THE INDEMNIFYING PERSON SHALL NOT RELIEVE IT
FROM ANY LIABILITY THAT IT MAY HAVE UNDER PARAGRAPH (A) OR (B) ABOVE EXCEPT TO
THE EXTENT THAT IT HAS BEEN MATERIALLY PREJUDICED (THROUGH THE FORFEITURE OF
SUBSTANTIVE RIGHTS OR DEFENSES) BY SUCH FAILURE; AND PROVIDED, FURTHER, THAT THE
FAILURE TO NOTIFY THE INDEMNIFYING PERSON SHALL NOT RELIEVE IT FROM ANY
LIABILITY THAT IT MAY HAVE TO AN INDEMNIFIED PERSON OTHERWISE THAN UNDER
PARAGRAPH (A) OR (B) ABOVE. IF ANY SUCH PROCEEDING SHALL BE BROUGHT OR ASSERTED
AGAINST AN INDEMNIFIED PERSON AND IT SHALL HAVE NOTIFIED THE INDEMNIFYING PERSON
THEREOF, THE INDEMNIFYING PERSON SHALL RETAIN COUNSEL REASONABLY SATISFACTORY TO
THE INDEMNIFIED PERSON (WHO SHALL NOT, WITHOUT THE CONSENT OF THE INDEMNIFIED
PERSON, BE COUNSEL TO THE INDEMNIFYING PERSON) TO REPRESENT THE INDEMNIFIED
PERSON AND ANY OTHERS ENTITLED TO INDEMNIFICATION PURSUANT TO THIS SECTION 7
THAT THE INDEMNIFYING PERSON MAY DESIGNATE IN SUCH PROCEEDING AND SHALL PAY THE
FEES AND EXPENSES OF SUCH PROCEEDING AND SHALL PAY THE FEES AND EXPENSES OF SUCH
COUNSEL RELATED TO SUCH PROCEEDING, AS INCURRED. IN ANY SUCH PROCEEDING, ANY
INDEMNIFIED PERSON SHALL HAVE THE RIGHT TO RETAIN ITS OWN COUNSEL, BUT THE FEES
AND EXPENSES OF SUCH COUNSEL SHALL BE AT THE EXPENSE OF SUCH INDEMNIFIED PERSON
UNLESS (I) THE INDEMNIFYING PERSON AND THE INDEMNIFIED PERSON SHALL HAVE
MUTUALLY AGREED TO THE CONTRARY; (II) THE INDEMNIFYING PERSON HAS FAILED WITHIN
A REASONABLE TIME TO RETAIN COUNSEL REASONABLY SATISFACTORY TO THE INDEMNIFIED
PERSON; (III) THE INDEMNIFIED PERSON SHALL HAVE REASONABLY BEEN ADVISED BY
COUNSEL THAT THERE MAY BE LEGAL DEFENSES AVAILABLE TO IT THAT ARE DIFFERENT FROM
OR IN ADDITION TO THOSE AVAILABLE TO THE INDEMNIFYING PERSON; OR (IV) THE NAMED
PARTIES IN ANY SUCH PROCEEDING (INCLUDING ANY IMPLEADED PARTIES) INCLUDE BOTH
THE INDEMNIFYING PERSON AND THE INDEMNIFIED PERSON AND REPRESENTATION OF BOTH
PARTIES BY THE SAME COUNSEL WOULD BE INAPPROPRIATE DUE TO ACTUAL OR POTENTIAL
DIFFERING INTERESTS BETWEEN THEM. IT IS UNDERSTOOD AND AGREED THAT THE
INDEMNIFYING PERSON SHALL NOT, IN CONNECTION WITH ANY PROCEEDING OR RELATED
PROCEEDING IN THE SAME JURISDICTION, BE LIABLE FOR THE FEES AND EXPENSES OF MORE
THAN ONE SEPARATE FIRM (IN ADDITION TO ANY LOCAL COUNSEL) FOR ALL INDEMNIFIED
PERSONS, AND THAT ALL SUCH FEES AND EXPENSES SHALL BE REIMBURSED AS THEY ARE
INCURRED. ANY SUCH SEPARATE FIRM FOR ANY INITIAL PURCHASER, ITS AFFILIATES,
DIRECTORS AND OFFICERS AND ANY CONTROL PERSONS OF SUCH INITIAL PURCHASER SHALL
BE DESIGNATED IN WRITING BY J.P. MORGAN SECURITIES INC. AND ANY SUCH SEPARATE
FIRM FOR THE ISSUER, THE GUARANTORS, THEIR RESPECTIVE DIRECTORS AND OFFICERS AND
ANY CONTROL PERSONS OF THE ISSUER AND THE GUARANTORS SHALL BE DESIGNATED IN
WRITING BY THE ISSUER. THE INDEMNIFYING PERSON SHALL NOT BE LIABLE FOR ANY
SETTLEMENT OF ANY PROCEEDING EFFECTED WITHOUT ITS WRITTEN CONSENT, BUT IF
SETTLED WITH SUCH CONSENT OR IF THERE BE A FINAL JUDGMENT FOR THE PLAINTIFF, THE
INDEMNIFYING PERSON AGREES TO INDEMNIFY EACH INDEMNIFIED PERSON FROM AND AGAINST
ANY LOSS OR LIABILITY BY REASON OF SUCH SETTLEMENT OR JUDGMENT. NOTWITHSTANDING
THE FOREGOING SENTENCE, IF AT ANY TIME AN INDEMNIFIED PERSON SHALL HAVE
REQUESTED THAT AN INDEMNIFYING PERSON REIMBURSE THE INDEMNIFIED PERSON FOR FEES
AND EXPENSES OF COUNSEL AS CONTEMPLATED BY THIS PARAGRAPH, THE INDEMNIFYING
PERSON SHALL BE LIABLE FOR ANY SETTLEMENT OF ANY PROCEEDING EFFECTED WITHOUT ITS
WRITTEN CONSENT IF (I) SUCH SETTLEMENT IS ENTERED INTO MORE THAN 45 DAYS AFTER
RECEIPT BY THE INDEMNIFYING PERSON OF SUCH REQUEST AND (II) THE INDEMNIFYING
PERSON SHALL NOT HAVE REIMBURSED THE INDEMNIFIED PERSON

 

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IN ACCORDANCE WITH SUCH REQUEST PRIOR TO THE DATE OF SUCH SETTLEMENT. NO
INDEMNIFYING PERSON SHALL, WITHOUT THE WRITTEN CONSENT OF THE INDEMNIFIED
PERSON, EFFECT ANY SETTLEMENT OF ANY PENDING OR THREATENED PROCEEDING IN RESPECT
OF WHICH ANY INDEMNIFIED PERSON IS OR COULD HAVE BEEN A PARTY AND
INDEMNIFICATION COULD HAVE BEEN SOUGHT HEREUNDER BY SUCH INDEMNIFIED PERSON,
UNLESS SUCH SETTLEMENT (X) INCLUDES AN UNCONDITIONAL RELEASE OF SUCH INDEMNIFIED
PERSON, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO SUCH INDEMNIFIED
PERSON, FROM ALL LIABILITY ON CLAIMS THAT ARE THE SUBJECT MATTER OF SUCH
PROCEEDING AND (Y) DOES NOT INCLUDE ANY STATEMENT AS TO OR ANY ADMISSION OF
FAULT, CULPABILITY OR A FAILURE TO ACT BY OR ON BEHALF OF ANY INDEMNIFIED
PERSON.

 

(D)                                 CONTRIBUTION. IF THE INDEMNIFICATION
PROVIDED FOR IN PARAGRAPHS (A) AND (B) ABOVE IS UNAVAILABLE TO AN INDEMNIFIED
PERSON OR INSUFFICIENT IN RESPECT OF ANY LOSSES, CLAIMS, DAMAGES OR LIABILITIES
REFERRED TO THEREIN, THEN EACH INDEMNIFYING PERSON UNDER SUCH PARAGRAPH, IN LIEU
OF INDEMNIFYING SUCH INDEMNIFIED PERSON THEREUNDER, SHALL CONTRIBUTE TO THE
AMOUNT PAID OR PAYABLE BY SUCH INDEMNIFIED PERSON AS A RESULT OF SUCH LOSSES,
CLAIMS, DAMAGES OR LIABILITIES (I) IN SUCH PROPORTION AS IS APPROPRIATE TO
REFLECT THE RELATIVE BENEFITS RECEIVED BY THE ISSUER AND THE GUARANTORS ON THE
ONE HAND AND THE INITIAL PURCHASERS ON THE OTHER FROM THE OFFERING OF THE
SECURITIES OR (II) IF THE ALLOCATION PROVIDED BY CLAUSE (I) IS NOT PERMITTED BY
APPLICABLE LAW, IN SUCH PROPORTION AS IS APPROPRIATE TO REFLECT NOT ONLY THE
RELATIVE BENEFITS REFERRED TO IN CLAUSE (I) BUT ALSO THE RELATIVE FAULT OF THE
ISSUER AND THE GUARANTORS ON THE ONE HAND AND THE INITIAL PURCHASERS ON THE
OTHER IN CONNECTION WITH THE STATEMENTS OR OMISSIONS THAT RESULTED IN SUCH
LOSSES, CLAIMS, DAMAGES OR LIABILITIES, AS WELL AS ANY OTHER RELEVANT EQUITABLE
CONSIDERATIONS. THE RELATIVE BENEFITS RECEIVED BY THE ISSUER AND THE GUARANTORS
ON THE ONE HAND AND THE INITIAL PURCHASERS ON THE OTHER SHALL BE DEEMED TO BE IN
THE SAME RESPECTIVE PROPORTIONS AS THE NET PROCEEDS (BEFORE DEDUCTING EXPENSES)
RECEIVED BY THE ISSUER FROM THE SALE OF THE SECURITIES AND THE TOTAL DISCOUNTS
AND COMMISSIONS RECEIVED BY THE INITIAL PURCHASERS IN CONNECTION THEREWITH, AS
PROVIDED IN THIS AGREEMENT, BEAR TO THE AGGREGATE OFFERING PRICE OF THE
SECURITIES. THE RELATIVE FAULT OF THE ISSUER AND THE GUARANTORS ON THE ONE HAND
AND THE INITIAL PURCHASERS ON THE OTHER SHALL BE DETERMINED BY REFERENCE TO,
AMONG OTHER THINGS, WHETHER THE UNTRUE OR ALLEGED UNTRUE STATEMENT OF A MATERIAL
FACT OR THE OMISSION OR ALLEGED OMISSION TO STATE A MATERIAL FACT RELATES TO
INFORMATION SUPPLIED BY THE ISSUER OR ANY GUARANTOR OR BY THE INITIAL PURCHASERS
AND THE PARTIES’ RELATIVE INTENT, KNOWLEDGE, ACCESS TO INFORMATION AND
OPPORTUNITY TO CORRECT OR PREVENT SUCH STATEMENT OR OMISSION.

 

(E)                                  LIMITATION ON LIABILITY. THE ISSUER, THE
GUARANTORS AND THE INITIAL PURCHASERS AGREE THAT IT WOULD NOT BE JUST AND
EQUITABLE IF CONTRIBUTION PURSUANT TO THIS SECTION 7 WERE DETERMINED BY PRO RATA
ALLOCATION (EVEN IF THE INITIAL PURCHASERS WERE TREATED AS ONE ENTITY FOR SUCH
PURPOSE) OR BY ANY OTHER METHOD OF ALLOCATION THAT DOES NOT TAKE ACCOUNT OF THE
EQUITABLE CONSIDERATIONS REFERRED TO IN PARAGRAPH (D) ABOVE. THE AMOUNT PAID OR
PAYABLE BY AN INDEMNIFIED PERSON AS A RESULT OF THE LOSSES, CLAIMS, DAMAGES AND
LIABILITIES REFERRED TO IN PARAGRAPH (D) ABOVE SHALL BE DEEMED TO INCLUDE,
SUBJECT TO THE LIMITATIONS SET FORTH ABOVE, ANY LEGAL OR OTHER EXPENSES INCURRED
BY SUCH INDEMNIFIED PERSON IN CONNECTION WITH ANY SUCH ACTION OR CLAIM.
NOTWITHSTANDING THE PROVISIONS OF THIS SECTION 7, IN NO EVENT SHALL AN INITIAL
PURCHASER BE REQUIRED TO CONTRIBUTE ANY AMOUNT IN EXCESS OF THE AMOUNT BY WHICH
THE TOTAL DISCOUNTS AND COMMISSIONS RECEIVED BY SUCH INITIAL PURCHASER WITH
RESPECT TO THE OFFERING OF THE SECURITIES EXCEEDS THE AMOUNT OF ANY DAMAGES THAT
SUCH INITIAL PURCHASER HAS OTHERWISE BEEN REQUIRED TO PAY BY REASON OF SUCH
UNTRUE OR ALLEGED UNTRUE STATEMENT OR OMISSION OR ALLEGED OMISSION. NO PERSON
GUILTY OF FRAUDULENT MISREPRESENTATION (WITHIN THE MEANING OF SECTION 11(F) OF
THE

 

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SECURITIES ACT) SHALL BE ENTITLED TO CONTRIBUTION FROM ANY PERSON WHO WAS NOT
GUILTY OF SUCH FRAUDULENT MISREPRESENTATION. THE INITIAL PURCHASERS’ OBLIGATIONS
TO CONTRIBUTE PURSUANT TO THIS SECTION 7 ARE SEVERAL IN PROPORTION TO THEIR
RESPECTIVE PURCHASE OBLIGATIONS HEREUNDER AND NOT JOINT.

 

(F)                                    NON-EXCLUSIVE REMEDIES. THE REMEDIES
PROVIDED FOR IN THIS SECTION 7 ARE NOT EXCLUSIVE AND SHALL NOT LIMIT ANY RIGHTS
OR REMEDIES THAT MAY OTHERWISE BE AVAILABLE TO ANY INDEMNIFIED PERSON AT LAW OR
IN EQUITY.

 

8.                                       TERMINATION. THIS AGREEMENT MAY BE
TERMINATED IN THE ABSOLUTE DISCRETION OF THE REPRESENTATIVE, BY NOTICE TO THE
ISSUER, IF AFTER THE EXECUTION AND DELIVERY OF THIS AGREEMENT AND ON OR PRIOR TO
THE CLOSING DATE (I) TRADING GENERALLY SHALL HAVE BEEN SUSPENDED OR MATERIALLY
LIMITED ON THE NEW YORK STOCK EXCHANGE OR THE OVER-THE-COUNTER MARKET;
(II) TRADING OF ANY SECURITIES ISSUED OR GUARANTEED BY THE ISSUER, NSI OR ANY OF
THE GUARANTORS SHALL HAVE BEEN SUSPENDED ON ANY EXCHANGE OR IN ANY
OVER-THE-COUNTER MARKET; (III) A GENERAL MORATORIUM ON COMMERCIAL BANKING
ACTIVITIES SHALL HAVE BEEN DECLARED BY FEDERAL OR NEW YORK STATE AUTHORITIES; OR
(IV) THERE SHALL HAVE OCCURRED ANY OUTBREAK OR ESCALATION OF HOSTILITIES OR ANY
CHANGE IN FINANCIAL MARKETS OR ANY CALAMITY OR CRISIS, EITHER WITHIN OR OUTSIDE
THE UNITED STATES, THAT, IN THE JUDGMENT OF THE REPRESENTATIVE, IS MATERIAL AND
ADVERSE AND MAKES IT IMPRACTICABLE OR INADVISABLE TO PROCEED WITH THE OFFERING,
SALE OR DELIVERY, OF THE SECURITIES ON THE TERMS AND IN THE MANNER CONTEMPLATED
BY THIS AGREEMENT, THE TIME OF SALE INFORMATION AND THE OFFERING MEMORANDUM.

 

9.                                       DEFAULTING INITIAL PURCHASER. (A)  IF,
ON THE CLOSING DATE, ANY INITIAL PURCHASER DEFAULTS ON ITS OBLIGATION TO
PURCHASE THE SECURITIES THAT IT HAS AGREED TO PURCHASE HEREUNDER, THE
NON-DEFAULTING INITIAL PURCHASERS MAY IN THEIR DISCRETION ARRANGE FOR THE
PURCHASE OF SUCH SECURITIES BY OTHER PERSONS SATISFACTORY TO THE ISSUER ON THE
TERMS CONTAINED IN THIS AGREEMENT. IF, WITHIN 24 HOURS AFTER ANY SUCH DEFAULT BY
ANY INITIAL PURCHASER, THE NON-DEFAULTING INITIAL PURCHASERS DO NOT ARRANGE FOR
THE PURCHASE OF SUCH SECURITIES, THEN THE ISSUER SHALL BE ENTITLED TO A FURTHER
PERIOD OF 24 HOURS WITHIN WHICH TO PROCURE OTHER PERSONS SATISFACTORY TO THE
NON-DEFAULTING INITIAL PURCHASERS TO PURCHASE SUCH SECURITIES ON SUCH TERMS. IF
OTHER PERSONS BECOME OBLIGATED OR AGREE TO PURCHASE THE SECURITIES OF A
DEFAULTING INITIAL PURCHASER, EITHER THE NON-DEFAULTING INITIAL PURCHASERS OR
THE ISSUER MAY POSTPONE THE CLOSING DATE FOR UP TO THREE FULL BUSINESS DAYS IN
ORDER TO EFFECT ANY CHANGES THAT IN THE OPINION OF COUNSEL FOR THE ISSUER OR
COUNSEL FOR THE INITIAL PURCHASERS MAY BE NECESSARY IN THE TIME OF SALE
INFORMATION, THE OFFERING MEMORANDUM OR IN ANY OTHER DOCUMENT OR ARRANGEMENT,
AND THE ISSUER AGREES TO PROMPTLY PREPARE ANY AMENDMENT OR SUPPLEMENT TO THE
TIME OF SALE INFORMATION OR THE OFFERING MEMORANDUM THAT EFFECTS ANY SUCH
CHANGES. AS USED IN THIS AGREEMENT, THE TERM “INITIAL PURCHASER” INCLUDES, FOR
ALL PURPOSES OF THIS AGREEMENT UNLESS THE CONTEXT OTHERWISE REQUIRES, ANY PERSON
NOT LISTED IN SCHEDULE 1 HERETO THAT, PURSUANT TO THIS SECTION 9, PURCHASES
SECURITIES THAT A DEFAULTING INITIAL PURCHASER AGREED BUT FAILED TO PURCHASE.

 

(B)                                 IF, AFTER GIVING EFFECT TO ANY ARRANGEMENTS
FOR THE PURCHASE OF THE SECURITIES OF A DEFAULTING INITIAL PURCHASER OR INITIAL
PURCHASERS BY THE NON-DEFAULTING INITIAL PURCHASERS AND THE ISSUER AS PROVIDED
IN PARAGRAPH (A) ABOVE, THE AGGREGATE PRINCIPAL AMOUNT OF SUCH SECURITIES THAT
REMAINS UNPURCHASED DOES NOT EXCEED ONE-ELEVENTH OF THE AGGREGATE PRINCIPAL
AMOUNT OF ALL THE SECURITIES, THEN THE ISSUER SHALL HAVE THE RIGHT TO REQUIRE
EACH NON-DEFAULTING INITIAL PURCHASER TO

 

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PURCHASE THE PRINCIPAL AMOUNT OF SECURITIES THAT SUCH INITIAL PURCHASER AGREED
TO PURCHASE HEREUNDER PLUS SUCH INITIAL PURCHASER’S PRO RATA SHARE (BASED ON THE
PRINCIPAL AMOUNT OF SECURITIES THAT SUCH INITIAL PURCHASER AGREED TO PURCHASE
HEREUNDER) OF THE SECURITIES OF SUCH DEFAULTING INITIAL PURCHASER OR INITIAL
PURCHASERS FOR WHICH SUCH ARRANGEMENTS HAVE NOT BEEN MADE.

 

(C)                                  IF, AFTER GIVING EFFECT TO ANY ARRANGEMENTS
FOR THE PURCHASE OF THE SECURITIES OF A DEFAULTING INITIAL PURCHASER OR INITIAL
PURCHASERS BY THE NON-DEFAULTING INITIAL PURCHASERS AND THE ISSUER AS PROVIDED
IN PARAGRAPH (A) ABOVE, THE AGGREGATE PRINCIPAL AMOUNT OF SUCH SECURITIES THAT
REMAINS UNPURCHASED EXCEEDS ONE-ELEVENTH OF THE AGGREGATE PRINCIPAL AMOUNT OF
ALL THE SECURITIES, OR IF THE ISSUER SHALL NOT EXERCISE THE RIGHT DESCRIBED IN
PARAGRAPH (B) ABOVE, THEN THIS AGREEMENT SHALL TERMINATE WITHOUT LIABILITY ON
THE PART OF THE NON-DEFAULTING INITIAL PURCHASERS. ANY TERMINATION OF THIS
AGREEMENT PURSUANT TO THIS SECTION 9 SHALL BE WITHOUT LIABILITY ON THE PART OF
THE ISSUER, NSI OR THE GUARANTORS, EXCEPT THAT THE ISSUER AND EACH OF THE
GUARANTORS WILL CONTINUE TO BE LIABLE FOR THE PAYMENT OF EXPENSES AS SET FORTH
IN SECTION 10 HEREOF AND EXCEPT THAT THE PROVISIONS OF SECTION 7 HEREOF SHALL
NOT TERMINATE AND SHALL REMAIN IN EFFECT.

 

(D)                                 NOTHING CONTAINED HEREIN SHALL RELIEVE A
DEFAULTING INITIAL PURCHASER OF ANY LIABILITY IT MAY HAVE TO THE ISSUER, ITS
AFFILIATES OR ANY NON-DEFAULTING INITIAL PURCHASER FOR DAMAGES CAUSED BY ITS
DEFAULT.

 

10.                                 PAYMENT OF EXPENSES. (A)  WHETHER OR NOT THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT ARE CONSUMMATED OR THIS AGREEMENT IS
TERMINATED, THE ISSUER AND EACH OF THE GUARANTORS JOINTLY AND SEVERALLY AGREE TO
PAY OR CAUSE TO BE PAID ALL COSTS AND EXPENSES INCIDENT TO THE PERFORMANCE OF
THEIR RESPECTIVE OBLIGATIONS HEREUNDER, INCLUDING WITHOUT LIMITATION, (I) THE
COSTS INCIDENT TO THE AUTHORIZATION, ISSUANCE, SALE, PREPARATION AND DELIVERY OF
THE SECURITIES AND, AS APPLICABLE, THE EXCHANGE SECURITIES AND ANY TAXES PAYABLE
IN THAT CONNECTION; (II) THE COSTS INCIDENT TO THE PREPARATION AND PRINTING OF
THE PRELIMINARY OFFERING MEMORANDUM, ANY OTHER TIME OF SALE INFORMATION, ANY
ISSUER WRITTEN COMMUNICATION AND THE OFFERING MEMORANDUM (INCLUDING ANY
AMENDMENT OR SUPPLEMENT THERETO) AND THE DISTRIBUTION THEREOF; (III) THE COSTS
OF REPRODUCING AND DISTRIBUTING EACH OF THE TRANSACTION DOCUMENTS; (IV) THE FEES
AND EXPENSES OF THE ISSUER’S, NSI’S AND THE GUARANTORS’ COUNSEL AND INDEPENDENT
ACCOUNTANTS; (V) THE FEES AND EXPENSES INCURRED IN CONNECTION WITH THE
REGISTRATION OR QUALIFICATION AND DETERMINATION OF ELIGIBILITY FOR INVESTMENT OF
THE SECURITIES UNDER THE LAWS OF SUCH JURISDICTIONS AS THE REPRESENTATIVE
MAY DESIGNATE AND THE PREPARATION, PRINTING AND DISTRIBUTION OF A BLUE SKY
MEMORANDUM (INCLUDING THE RELATED REASONABLE FEES AND EXPENSES OF ONE COUNSEL
FOR THE INITIAL PURCHASERS IN CONNECTION THEREWITH); (VI) ANY FEES CHARGED BY
RATING AGENCIES FOR RATING THE SECURITIES; (VII) THE FEES AND EXPENSES OF THE
TRUSTEE AND ANY PAYING AGENT (INCLUDING RELATED FEES AND EXPENSES OF ANY COUNSEL
TO SUCH PARTIES); (VIII) ALL EXPENSES AND APPLICATION FEES INCURRED IN
CONNECTION WITH THE APPLICATION FOR THE INCLUSION OF THE SECURITIES ON THE
PORTAL MARKET AND THE APPROVAL OF THE SECURITIES FOR BOOK-ENTRY TRANSFER BY DTC;
(IX) ALL EXPENSES INCURRED BY THE ISSUER IN CONNECTION WITH ANY “ROAD SHOW”
PRESENTATION TO POTENTIAL INVESTORS; AND (X) THE COSTS OF CREATING AND
PERFECTING THE SECURITY INTERESTS AS CONTEMPLATED BY THE SECURITY AGREEMENTS
(INCLUDING THE RELATED REASONABLE COSTS OF COUNSEL FOR THE INITIAL PURCHASERS IN
CONNECTION THEREWITH) AND THE FEES AND EXPENSES OF THE COLLATERAL AGENTS
(INCLUDING THE REASONABLE FEES AND EXPENSES OF THEIR PROFESSIONAL ADVISORS). IT
IS UNDERSTOOD, HOWEVER, THAT EXCEPT AS PROVIDED IN THIS SECTION, SECTION 7 AND
SECTION 9, THE INITIAL PURCHASERS WILL PAY ALL OF THEIR COSTS AND

 

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EXPENSES, INCLUDING THE FEES AND EXPENSES OF THEIR COUNSEL AND ANY ADVERTISING
EXPENSES CONNECTED WITH ANY OFFERS THEY MAY MAKE.

 

(B)                                 IF (I) THIS AGREEMENT IS TERMINATED PURSUANT
TO SECTION 8, (II) THE ISSUER FOR ANY REASON FAILS (OTHER THAN BY REASON OF A
BREACH OF THIS AGREEMENT BY THE INITIAL PURCHASERS) TO TENDER THE SECURITIES FOR
DELIVERY TO THE INITIAL PURCHASERS OR (III) THE INITIAL PURCHASERS DECLINE TO
PURCHASE THE SECURITIES FOR ANY REASON PERMITTED UNDER THIS AGREEMENT, THE
ISSUER AND EACH OF THE GUARANTORS JOINTLY AND SEVERALLY AGREE TO REIMBURSE THE
INITIAL PURCHASERS FOR ALL OUT-OF-POCKET COSTS AND EXPENSES (INCLUDING THE FEES
AND EXPENSES OF THEIR COUNSEL) REASONABLY INCURRED BY THE INITIAL PURCHASERS IN
CONNECTION WITH THIS AGREEMENT AND THE OFFERING CONTEMPLATED HEREBY.

 

11.                                 PERSONS ENTITLED TO BENEFIT OF AGREEMENT.
THIS AGREEMENT SHALL INURE TO THE BENEFIT OF AND BE BINDING UPON (A) THE PARTIES
HERETO AND THEIR RESPECTIVE SUCCESSORS AND ANY CONTROLLING PERSONS REFERRED TO
HEREIN AND (B)(I) THE AFFILIATES, OFFICERS AND DIRECTORS OF EACH INITIAL
PURCHASER AND (II) THE OFFICERS AND DIRECTORS OF THE ISSUER AND EACH OF THE
GUARANTORS, IN THE CASE OF CLAUSES (B)(I) AND (B)(II) ABOVE, REFERRED TO IN
SECTION 7 HEREOF. NOTHING IN THIS AGREEMENT IS INTENDED OR SHALL BE CONSTRUED TO
GIVE ANY OTHER PERSON ANY LEGAL OR EQUITABLE RIGHT, REMEDY OR CLAIM UNDER OR IN
RESPECT OF THIS AGREEMENT OR ANY PROVISION CONTAINED HEREIN. NO PURCHASER OF
SECURITIES FROM ANY INITIAL PURCHASER SHALL BE DEEMED TO BE A SUCCESSOR MERELY
BY REASON OF SUCH PURCHASE.

 

12.                                 SURVIVAL. THE RESPECTIVE INDEMNITIES, RIGHTS
OF CONTRIBUTION, REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE ISSUER,
NOVAMERICAN STEEL AND EACH OF THE GUARANTORS AND THE INITIAL PURCHASERS
CONTAINED IN THIS AGREEMENT OR MADE BY OR ON BEHALF OF THE ISSUER, NOVAMERICAN
STEEL, THE GUARANTORS OR THE INITIAL PURCHASERS PURSUANT TO THIS AGREEMENT OR
ANY CERTIFICATE DELIVERED PURSUANT HERETO SHALL SURVIVE THE DELIVERY OF AND
PAYMENT FOR THE SECURITIES AND SHALL REMAIN IN FULL FORCE AND EFFECT, REGARDLESS
OF ANY TERMINATION OF THIS AGREEMENT OR ANY INVESTIGATION MADE BY OR ON BEHALF
OF THE ISSUER, NOVAMERICAN STEEL, THE GUARANTORS OR THE INITIAL PURCHASERS.

 

13.                                 CERTAIN DEFINED TERMS. FOR PURPOSES OF THIS
AGREEMENT, (A) EXCEPT WHERE OTHERWISE EXPRESSLY PROVIDED, THE TERM “AFFILIATE”
HAS THE MEANING SET FORTH IN RULE 405 UNDER THE SECURITIES ACT; (B) THE TERM
“BUSINESS DAY” MEANS ANY DAY OTHER THAN A DAY ON WHICH BANKS ARE PERMITTED OR
REQUIRED TO BE CLOSED IN NEW YORK CITY; (C) THE TERM “EXCHANGE ACT” MEANS THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED; (D) THE TERM “SUBSIDIARY” HAS THE
MEANING SET FORTH IN RULE 405 UNDER THE SECURITIES ACT; AND (E) THE TERM
“WRITTEN COMMUNICATION” HAS THE MEANING SET FORTH IN RULE 405 UNDER THE
SECURITIES ACT.

 

14.                                 CONSENT TO JURISDICTION. ANY LEGAL SUIT,
ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY (THE “RELATED PROCEEDINGS”) MAY BE INSTITUTED
IN THE FEDERAL COURTS OF THE UNITED STATES LOCATED IN THE CITY AND COUNTY OF NEW
YORK OR THE COURTS OF THE STATE OF NEW YORK IN EACH CASE LOCATED IN THE CITY AND
COUNTY OF NEW YORK (COLLECTIVELY, THE “SPECIFIED COURTS”), AND EACH PARTY
IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION (EXCEPT FOR SUITS, ACTIONS, OR
PROCEEDINGS INSTITUTED IN REGARD TO THE ENFORCEMENT OF A JUDGMENT OF ANY
SPECIFIED COURT IN A RELATED PROCEEDING (EACH SUCH JUDGMENT, A “RELATED
JUDGMENT”), AS TO WHICH SUCH JURISDICTION IS NON-EXCLUSIVE) OF THE SPECIFIED
COURTS IN ANY RELATED PROCEEDING. SERVICE OF ANY PROCESS, SUMMONS, NOTICE OR
DOCUMENT BY MAIL TO SUCH

 

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PARTY’S ADDRESS SET FORTH BELOW SHALL BE EFFECTIVE SERVICE OF PROCESS FOR ANY
RELATED PROCEEDING BROUGHT IN ANY SPECIFIED COURT. THE PARTIES IRREVOCABLY AND
UNCONDITIONALLY WAIVE ANY OBJECTION TO THE LAYING OF VENUE OF ANY SPECIFIED
PROCEEDING IN THE SPECIFIED COURTS AND IRREVOCABLY AND UNCONDITIONALLY WAIVE AND
AGREE NOT TO PLEAD OR CLAIM IN ANY SPECIFIED COURT THAT ANY RELATED PROCEEDING
BROUGHT IN ANY SPECIFIED COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. EACH
PARTY NOT LOCATED IN THE UNITED STATES IRREVOCABLY APPOINTS CT CORPORATION
SYSTEM AS ITS AGENT TO RECEIVE SERVICE OF PROCESS OR OTHER LEGAL SUMMONS FOR
PURPOSES OF ANY RELATED PROCEEDING THAT MAY BE INSTITUTED IN ANY SPECIFIED
COURT.

 

15.                                 WAIVER OF IMMUNITY. WITH RESPECT TO ANY
RELATED PROCEEDING, EACH PARTY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ALL IMMUNITY (WHETHER ON THE BASIS OF SOVEREIGNTY
OR OTHERWISE) FROM JURISDICTION, SERVICE OF PROCESS, ATTACHMENT (BOTH BEFORE AND
AFTER JUDGMENT) AND EXECUTION TO WHICH IT MIGHT OTHERWISE BE ENTITLED IN THE
SPECIFIED COURTS AND, WITH RESPECT TO ANY RELATED JUDGMENT, EACH PARTY WAIVES
ANY SUCH IMMUNITY IN THE SPECIFIED COURTS OR ANY OTHER COURT OF COMPETENT
JURISDICTION AND WILL NOT RAISE OR CLAIM OR CAUSE TO BE PLEADED ANY SUCH
IMMUNITY AT OR IN RESPECT OF ANY SUCH RELATED PROCEEDING OR RELATED JUDGMENT,
INCLUDING, WITHOUT LIMITATION, ANY IMMUNITY PURSUANT TO THE UNITED STATES
FOREIGN SOVEREIGN IMMUNITIES ACT OF 1976, AS AMENDED.

 

16.                                 JUDGMENT CURRENCY. IF FOR THE PURPOSES OF
OBTAINING JUDGMENT IN ANY COURT IT IS NECESSARY TO CONVERT A SUM DUE HEREUNDER
INTO ANY CURRENCY OTHER THAN U.S. DOLLARS, THE PARTIES HERETO AGREE, TO THE
FULLEST EXTENT THAT THEY MAY EFFECTIVELY DO SO, THAT THE RATE OF EXCHANGE USED
SHALL BE THE RATE AT WHICH IN ACCORDANCE WITH NORMAL BANKING PROCEDURES THE
INITIAL PURCHASERS COULD PURCHASE U.S. DOLLARS WITH SUCH OTHER CURRENCY IN NEW
YORK CITY ON THE BUSINESS DAY PRECEDING THAT ON WHICH FINAL JUDGMENT IS GIVEN.
THE OBLIGATIONS OF THE ISSUER, NOVAMERICAN STEEL AND EACH GUARANTOR IN RESPECT
OF ANY SUM DUE FROM THEM TO ANY INITIAL PURCHASER SHALL, NOTWITHSTANDING ANY
JUDGMENT IN ANY CURRENCY OTHER THAN U.S. DOLLARS, NOT BE DISCHARGED UNTIL THE
FIRST BUSINESS DAY, FOLLOWING RECEIPT BY SUCH INITIAL PURCHASER OF ANY SUM
ADJUDGED TO BE SO DUE IN SUCH OTHER CURRENCY, ON WHICH (AND ONLY TO THE EXTENT
THAT) SUCH INITIAL PURCHASER MAY IN ACCORDANCE WITH NORMAL BANKING PROCEDURES
PURCHASE U.S. DOLLARS WITH SUCH OTHER CURRENCY; IF THE U.S. DOLLARS SO PURCHASED
ARE LESS THAN THE SUM ORIGINALLY DUE TO SUCH INITIAL PURCHASER HEREUNDER, THE
ISSUER, NOVAMERICAN STEEL AND EACH GUARANTOR AGREE, AS A SEPARATE OBLIGATION AND
NOTWITHSTANDING ANY SUCH JUDGMENT, TO INDEMNIFY SUCH INITIAL PURCHASER AGAINST
SUCH LOSS. IF THE U.S. DOLLARS SO PURCHASED ARE GREATER THAN THE SUM ORIGINALLY
DUE TO SUCH INITIAL PURCHASER HEREUNDER, SUCH INITIAL PURCHASER AGREES TO PAY TO
THE ISSUER, NOVAMERICAN STEEL AND THE GUARANTORS (BUT WITHOUT DUPLICATION) AN
AMOUNT EQUAL TO THE EXCESS OF THE U.S. DOLLARS SO PURCHASED OVER THE SUM
ORIGINALLY DUE TO SUCH INITIAL PURCHASER HEREUNDER.

 

17.                                 MISCELLANEOUS. (A)  AUTHORITY OF THE
REPRESENTATIVE. ANY ACTION BY THE INITIAL PURCHASERS HEREUNDER MAY BE TAKEN BY
J.P. MORGAN SECURITIES INC. ON BEHALF OF THE INITIAL PURCHASERS, AND ANY SUCH
ACTION TAKEN BY J.P. MORGAN SECURITIES INC. SHALL BE BINDING UPON THE INITIAL
PURCHASERS.

 

Notices. All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given if mailed or transmitted and confirmed
by any standard form of telecommunication. Notices to the Initial Purchasers
shall be given to the Representative c/o J.P. Morgan Securities Inc., 270 Park
Avenue, New York, New York 10017 (fax:  (212)-270-1063);

 

37

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

 

Attention: Timothy Collins. Notices to the Issuer, Novamerican Steel and the
Guarantors shall be given to them at Symmetry Holdings Inc., 28 West 44th
Street, 16th Floor, New York, New York 10036, (fax: (646)-429-1541); Attention:
General Counsel.

 

(B)                                 GOVERNING LAW. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

(C)                                  COUNTERPARTS. THIS AGREEMENT MAY BE SIGNED
IN COUNTERPARTS (WHICH MAY INCLUDE COUNTERPARTS DELIVERED BY ANY STANDARD
FORM OF TELECOMMUNICATION), EACH OF WHICH SHALL BE AN ORIGINAL AND ALL OF WHICH
TOGETHER SHALL CONSTITUTE ONE AND THE SAME INSTRUMENT.

 

(D)                                 AMENDMENTS OR WAIVERS. NO AMENDMENT OR
WAIVER OF ANY PROVISION OF THIS AGREEMENT, NOR ANY CONSENT OR APPROVAL TO ANY
DEPARTURE THEREFROM, SHALL IN ANY EVENT BE EFFECTIVE UNLESS THE SAME SHALL BE IN
WRITING AND SIGNED BY THE PARTIES HERETO.

 

(E)                                  HEADINGS. THE HEADINGS HEREIN ARE INCLUDED
FOR CONVENIENCE OF REFERENCE ONLY AND ARE NOT INTENDED TO BE PART OF, OR TO
AFFECT THE MEANING OR INTERPRETATION OF, THIS AGREEMENT.

 

38

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

 

If the foregoing is in accordance with your understanding, please indicate your
acceptance of this Agreement by signing in the space provided below.

 

 

Very truly yours,

 

 

 

NOVAMERICAN STEEL FINCO INC.,

 

 

 

 

By

/s/ Karen G. Narwold

 

 

Name: Karen G. Narwold

 

 

Title: Secretary

 

 

 

 

 

 

 

SYMMETRY HOLDINGS INC.,

 

 

 

 

By

/s/ Domenico Lepore

 

 

Name: Domenico Lepore

 

 

Title: President

 

 

 

 

 

 

 

NOVAMERICAN STEEL HOLDINGS INC.,

 

 

 

 

By

/s/ Karen G. Narwold

 

 

Name: Karen G. Narwold

 

 

Title: Secretary

 

 

Accepted:  November 14, 2007

 

J.P. MORGAN SECURITIES INC.

 

For itself and on behalf of the
several Initial Purchasers listed
in Schedule 1 hereto.

 

 

By

/s/ David A. Dwyer

 

 

 

Authorized Signatory

 

 

David A. Dwyer

 

 

Executive Director

 

 

39

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

 

Schedule 1

 

Initial Purchaser

 

Principal Amount

 

J.P. Morgan Securities Inc.

 

$

210,010,500.00

 

 

 

 

 

CIBC World Markets Corp.

 

$

104,989,500.00

 

 

 

 

 

Total

 

$

315,000,000.00

 

 

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

 

Schedule 2

 

Guarantors

 

Symmetry Holdings Inc.

 

Novamerican Steel Holdings Inc.

 

Integrated Steel Industries, Inc.

 

American Steel and Aluminum Corporation

 

Nova Tube and Steel, Inc.

 

Novamerican Tube Holdings, Inc.

 

Nova Tube Indiana, LLC

 

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

 

Schedule 3(a)

 

Mortgaged Properties

 

One West Albany Drive, Colonie (Albany), NY

 

11111 Leadbetter Road, Hanover Industrial Park, Ashland, VA

 

27 Elm Street, Auburn, MA

 

197 Dexter Street, Cumberland, RI

 

2751 Spring Garden Drive, Lower Swatara Township, Dauphin County, PA

 

419/425 Homestead Avenue, Hartford, CT

 

1080/1050 University Avenue, Norwood, MA

 

115 Wallace Avenue, South Portland, ME

 

4601 Crown Road, Clay (Syracuse), NY

 

600 Dean Sievers Place, Falls Township, Buck County, PA

 

1195 Port Road, Jeffersonville, IN

 

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

 

Schedule 3(b)

 

Filing Jurisdictions

 

No. of
Properties

 

STATE

 

COUNTY/TOWN

 

1

 

Connecticut

 

City of Hartford

 

1

 

Indiana

 

Clark

 

1

 

Maine

 

Cumberland

 

2

 

Massachusetts

 

Norfolk
Worcester

 

2

 

New York

 

Albany
Onondaga

 

2

 

Pennsylvania

 

Bucks
Dauphin

 

1

 

Rhode island

 

Town of Cumberland

 

1

 

Virginia

 

Hanover

 

 

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

 

Schedule 3(c)

 

Canadian Mortgaged Properties

 

1.                                       830 South Service Road, Stoney Creek,
Ontario

2.                                       553 Léon Harmel Street, Granby, Québec

3.                                       424 St.-Vallier Street, Granby, Québec

4.                                       50 Pacifique Street East, Bromont,
Québec

 

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

 

Schedule 3(d)

 

Canadian Mortgage Jurisdictions

 

1.                                       Ontario

2.                                       Quebec

 

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

 

Schedule 4

 

Joining Parties

 

Integrated Steel Industries, Inc.

 

American Steel and Aluminum Corporation

 

Nova Tube and Steel, Inc.

 

Novamerican Tube Holdings, Inc.

 

Nova Tube Indiana, LLC

 

Novamerican Steel Inc.

 

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

 

Schedule 5(a)

 

Subsidiaries of NSI

 

Prior to commencement of the Transactions:

 

156499 Canada Inc., a Canadian corporation

 

McKendwell Investments Inc., a Canadian corporation

 

165948 Canada Inc., a Canadian corporation

 

Nova Steel Ltd., a Canadian corporation — Acier Nova Ltée

 

Acier Metco Inc., a Quebec company

 

Integrated Steel Industries, Inc., a Delaware corporation

 

Nova Tube Inc., a Québec company — Tube Nova Inc.

 

Nova Tube Ontario Inc., a Canadian corporation — Tube Nova Ontario Inc.

 

Cresswell Industries Inc., a Canadian corporation — Industries Cresswell Inc.

 

Nova Steel Processing Centre Ltd., a Canadian corporation — Centre de Traitement
Aeier Nova Ltée

 

Argo Steel Ltd., a Québec company — Acier Argo Ltée

 

Hencorp LLC, a Delaware limited liability company

 

Chriscorp ULC, a Nova Scotia unlimited liability company

 

Delta Tube Inc., a Québec company that is 60% owned by Nova Steel Ltd. — Tubes
Delta Inc.

 

Tubes Delta, Société en Commandite, a Québec limited partnership that is 60%
owned by Nova Steel Ltd. and of which Delta Tube Inc. is the General Partner —
Delta Tube and Company Limited

 

American Steel and Aluminum Corporation, a Massachusetts corporation

 

Nova Tube and Steel, Inc., a Delaware corporation

 

Novamerican Tube Holdings, Inc. (Placements Novamerican Tube Inc.), a Delaware
corporation

 

Annaco General Partnership, a Delaware general partnership

 

Nova Tube Indiana, LLC, a Delaware limited liability company

 

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

 

4421591 Canada Inc., a Canadian corporation

 

48

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

 

Schedule 5(b)

 

Subsidiaries of the Issuer

 

1.                                       Prior to the consummation of the
Transactions:

 

632421 N.B. Ltd., a New Brunswick corporation

 

632422 N.B. Ltd., a New Brunswick corporation

 

2.                                       After consummation of the Transactions:

 

Integrated Steel Industries, Inc., a Delaware corporation

 

American Steel and Aluminum Corporation, a Massachusetts corporation

 

Nova Tube and Steel, Inc., a Delaware corporation

 

Novamerican Tube Holdings, Inc., a Delaware corporation

 

Nova Tube Indiana, LLC, a Delaware limited liability company

 

Novamerican Steel Inc., a Canadian corporation

 

632422 N.B. Ltd., a New Brunswick corporation

 

Delta Tube Inc., a Québec company that will be 60% owned by Novamerican Steel
Inc. — Tubes Delta Inc.

 

Tubes Delta, Société en Commandite, a Québec limited partnership that will be
60% owned by Novamerican Steel Inc. and of which Delta Tube Inc. is the General
Partner — Delta Tube and Company Limited

 

3217928 Nova Scotia Company

 

3217930 Nova Scotia Company

 

3218088 Nova Scotia Company

 

Acier Metco Inc., a Quebec company

 

4421591 Canada Inc., a Canadian corporation

 

Argo Steel Ltd., a Québec company

 

Nova Tube Inc., a Québec company

 

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

 

Hencorp LLC, a Delaware limited liability company

 

50

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

 

Schedule 5(c)

 

Subsidiaries of Symmetry

 

1.                                       Prior to consummation of the
Transactions:

 

Novamerican Steel Holdings Inc., a Delaware corporation

 

Novamerican Steel Finco Inc., a Delaware corporation

 

All subsidiaries of the Issuer listed in Schedule 5(b)(1)

 

2.                                       After consummation of the Transactions:

 

Novamerican Steel Holdings Inc., a Delaware corporation

 

Novamerican Steel Finco Inc., a Delaware corporation

 

All subsidiaries of the Issuer listed in Schedule 5(b)(2)

 

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

 

ANNEX A

 

Additional Time of Sale Information

 

1.                                       Term sheet containing the terms of the
securities, substantially in the form of Annex B.

 

2.                                       Electronic Road Show Presentation,
dated November 2, 2007.

 

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

 

ANNEX B

 

Novamerican Steel Finco Inc.

 

Pricing Term Sheet

 

Issuer:

 

Novamerican Steel Finco Inc.

 

Security Description:

 

Senior Secured Notes

 

Distribution:

 

144A/RegS w/ Registration Rights

 

Face:

 

$315,000,000

 

Gross Proceeds:

 

$315,000,000

 

Net Proceeds to Issuer:

 

$305,550,000

 

Coupon:

 

11.50%

 

Maturity:

 

November 15, 2015

 

Offering Price:

 

The initial purchasers may offer the notes from time to time, in the
over-the-counter market or through negotiated transactions at market prices or
negotiated prices.

 

Benchmark:

 

UST 4.5% due 11/15/2015

 

Ratings:

 

B3/B-

 

Interest Pay Dates:

 

November 15 and May 15

 

Beginning:

 

May 15, 2008

 

Equity Clawback:

 

Up to 35% at 111.50%

 

Until:

 

November 15, 2010

 

Optional redemption:

 

On or after:

 

Price:

 

 

 

November 15, 2011

 

105.750

%

 

 

November 15, 2012

 

102.875

%

 

 

November 15, 2013 and thereafter

 

100.000

%

Change of control:

 

Put @ 101% of principal plus accrued interest

 

Trade Date:

 

November 14, 2007

 

Settlement Date:

(T+1)

November 15, 2007

 

CUSIP:

 

144A:  66987YAA1

 

 

 

Reg S:  U6695TAA8

 

ISIN:

 

USU6695TAA89

 

Denominations:

 

2,000x1,000

 

 

 

 

 

Bookrunners:         

 

JPMorgan

 

 

 

CIBC World Markets

 

Comments:

 

 

 

Certain U.S. federal income tax matters:

 

The notes may be issued with original issue discount (“OID”) in an amount equal
to the difference between their principal amount and their issue price. The
“issue price” of each Note will be the first price at which a substantial amount
of the notes is sold (other than to an underwriter,

 

 

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

 

 

 

placement agent or wholesaler). To the extent there is any OID, Note holders
generally will be required to include such OID in gross income as it accrues, in
advance of the receipt of cash attributable to that income and regardless of the
holder’s regular method of accounting for U.S. federal income tax purposes.

 

For a summary of certain U.S. federal income tax consequences of the purchase,
ownership and disposition of the notes, you are encouraged to read “Certain U.S.
federal income tax consequences” attached to this Pricing Term Sheet as Annex A.
The information included in Annex A to this Pricing Term Sheet supersedes and
replaces in its entirety the information set forth under the caption “Certain
U.S. federal income tax consequences” in the Preliminary Offering Memorandum.

 

 

Capitalized terms used but not defined in this term sheet have the meanings
assigned to such terms in the Issuer’s Preliminary Offering Memorandum dated
October 29, 2007 (the “Preliminary Offering Memorandum”).

 

The notes have not been registered under the U.S. Securities Act of 1933, as
amended, and are being offered only to qualified institutional buyers under
Rule 144A and outside the United States in compliance with Regulation S.

 

This term sheet is qualified in its entirety by reference to the Preliminary
Offering Memorandum. The information in this term sheet supplements the
Preliminary Offering Memorandum and supersedes the information in the
Preliminary Offering Memorandum to the extent inconsistent with the information
in the Preliminary Offering Memorandum.

 

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

 

ANNEX A

 

Certain U.S. federal income tax consequences

 

To ensure compliance with Internal Revenue Service Circular 230, you are hereby
notified that any discussion of tax matters set forth in this offering
memorandum was written in connection with the promotion or marketing of the
transactions or matters addressed herein and was not intended or written to be
used, and cannot be used by any prospective investor, for the purpose of
avoiding tax-related penalties under federal, state or local tax law. Each
prospective investor should seek advice based on its particular circumstances
from an independent tax advisor.

 

The following is a summary of certain U.S. federal income tax consequences of
the purchase, ownership and disposition of the notes as of the date hereof.
Except where noted, this summary deals only with notes that are held as capital
assets by holders who purchase the notes for cash upon original issuance at
their initial offering price. As used herein, a “U.S. holder” means a beneficial
owner of the notes that is for U.S. federal income tax purposes any of the
following:

 

•                                          an individual citizen or resident of
the United States;

 

•                                          a corporation (or any other entity
treated as a corporation for U.S. federal income tax purposes) created or
organized in or under the laws of the United States, any state thereof or the
District of Columbia;

 

•                                          an estate the income of which is
subject to U.S. federal income taxation regardless of its source; or

 

•                                          a trust if it (1) is subject to the
primary supervision of a court within the United States and one or more United
States persons have the authority to control all substantial decisions of the
trust or (2) has a valid election in effect under applicable U.S. Treasury
regulations to be treated as a United States person.

 

The term “non-U.S. holder” means a beneficial owner of the notes (other than a
partnership or any other entity treated as a partnership for U.S. federal income
tax purposes) that is not a U.S. holder.

 

This summary does not represent a detailed description of the U.S. federal
income tax consequences applicable to you if you are a person subject to special
tax treatment under the U.S. federal income tax laws, including, without
limitation:

 

•                                          a dealer in securities or currencies;

 

•                                          a financial institution;

 

•                                          a regulated investment company;

 

•                                          a real estate investment trust;

 

•                                          a tax-exempt organization;

 

•                                          an insurance company;

 

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

 

•                                          a person holding the notes as part of
a hedging, integrated, conversion or constructive sale transaction or a
straddle;

 

•                                          a trader in securities that has
elected the mark-to-market method of accounting for your securities;

 

•                                          a person liable for alternative
minimum tax;

 

•                                          a partnership or other pass-through
entity for U.S. federal income tax purposes;

 

•                                          a U.S. holder whose “functional
currency” is not the U.S. dollar;

 

•                                          a controlled foreign corporation;

 

•                                          a passive foreign investment company;
or

 

•                                          a U.S. expatriate.

 

This summary is based on the Internal Revenue Code of 1986, as amended (the
“Code”), United States Treasury regulations, administrative rulings and judicial
decisions as of the date hereof. Those authorities may be changed, possibly on a
retroactive basis, so as to result in U.S. federal income tax consequences
different from those summarized below.

 

If a partnership (including any entity classified as a partnership for U.S.
federal income tax purposes) holds notes, the tax treatment of a partner will
generally depend upon the status of the partner and the activities of the
partnership. If you are a partnership or a partner in a partnership holding
notes, you should consult your own tax advisors.

 

This summary does not represent a detailed description of the U.S. federal
income tax consequences to you in light of your particular circumstances and
does not address the effects of any state, local or non-United States tax laws.
It is not intended to be, and should not be construed to be, legal or tax advice
to any particular purchaser of notes. If you are considering the purchase of
notes, you should consult your own tax advisors concerning the particular U.S.
federal income tax consequences to you of the ownership of the notes, as well as
the consequences to you arising under the laws of any other taxing jurisdiction.

 

Certain tax consequences to U.S. holders

 

The following is a summary of certain U.S. federal income tax consequences that
will apply to U.S. holders of the notes.

 

Payments of interest

 

Except as set forth below, qualified stated interest on a note will generally be
taxable to you as ordinary income at the time it is paid or accrued in
accordance with your method of accounting for tax purposes. If the notes are not
issued with more than a de minimis amount at original issue discount (“OID”), as
described below, all the interest payable on the notes will be qualified stated
interest.

 

Original issue discount

 

Depending upon the issue price of the notes, the notes may be issued with OID in
an amount equal to the difference between their “stated redemption price at
maturity” (the sum of all payments to be made

 

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

 

on the notes other than “qualified stated interest”) and their “issue price.”
You should be aware that you generally must include OID in gross income in
advance of the receipt of cash attributable to that income. OID is considered de
minimis if the total OID is less than twenty-five basis points (.25%),
multiplied by the number of full years from the issue date to the maturity date
of the Note. However, you generally will not be required to include separately
in income cash payments received on the notes, even if denominated as interest,
to the extent such payments do not constitute “qualified stated interest” (as
defined below).

 

This summary is based upon final Treasury regulations addressing debt
instruments issued with OID.

 

The “issue price” of each note will be the first price at which a substantial
amount of that particular offering is sold (other than to an underwriter,
placement agent or wholesaler). The term “qualified stated interest” means
stated interest that is unconditionally payable in cash or in property (other
than debt instruments of the issuer), and meet all of the following conditions:

 

•                                          it is payable at least once per year;

 

•                                          it is payable over the entire term of
the note; and

 

•                                          it is payable at a single fixed rate
or, subject to certain conditions, based on one or more interest indices.

 

The stated interest payments on the notes are qualified stated interest.

 

The amount of OID that you must include in income if you are the initial U.S.
holder of a note is the sum of the “daily portions” of OID with respect to the
note for each day during the taxable year or portion of the taxable year in
which you held such note (“accrued OID”). The daily portion is determined by
allocating to each day in any “accrual period” a pro rata portion of the OID
allocable to that accrual period. The “accrual period” for a note may be of any
length and may vary in length over the term of the note, provided that each
accrual period is no longer than one year and each scheduled payment of
principal or interest occurs on the first day or the final day of an accrual
period. The amount of OID allocable to any accrual period is an amount equal to
the excess, if any, of:

 

•                                          the product of the note’s adjusted
issue price at the beginning of such accrual period and its yield to maturity
(determined on the basis of compounding at the close of each accrual period and
properly adjusted for the length of the accrual period), over

 

•                                          the aggregate of all qualified stated
interest allocable to the accrual period.

 

OID allocable to a final accrual period is the difference between the amount
payable at maturity (other than a payment of qualified stated interest) and the
adjusted issue price at the beginning of the final accrual period. Special rules
will apply for calculating OID for an initial short accrual period. The
“adjusted issue price” of a note at the beginning of any accrual period is equal
to its issue price increased by the accrued OID for each prior accrual period
and reduced by any payments made on such note (other than qualified stated
interest) on or before the first day of the accrual period. Under these rules,
you will have to include in income increasingly greater amounts of OID in
successive accrual periods. We are required to provide information returns
stating the amount of OID accrued on notes held of record by persons other than
corporations and other exempt holders.

 

You may elect to treat all interest on a note as OID and calculate the amount
includible in gross income under the constant yield method described above. The
election is to be made for the taxable

 

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

 

year in which you acquired the note, and may not be revoked without the consent
of the Internal Revenue Service (“IRS”). You should consult with your own tax
advisors about this election.

 

Sale, exchange, retirement, or other taxable disposition of notes

 

Upon the sale, exchange, retirement, or other taxable disposition of a note, you
generally will recognize gain or loss equal to the difference between the amount
realized upon the sale, exchange, retirement, or other taxable disposition (less
an amount equal to any accrued qualified stated interest that you did not
previously include in income, which will be taxable as interest income) and the
adjusted tax basis of the note. Your adjusted tax basis in a note will, in
general, be your cost for the note increased by the amount of OID, if any 
previously included in income.

 

Any gain or loss you recognize will be capital gain or loss and will be
long-term capital gain or loss if at the time of sale, exchange, retirement or
other disposition, the note has been held for more than one year. Capital gains
of noncorporate U.S. holders (including individuals) derived with respect to
capital assets held for more than one year are eligible for reduced rates of
taxation. The deductibility of capital losses is subject to limitations.

 

Certain tax consequences to non-U.S. holders

 

The following is a summary of certain U.S. federal income tax consequences that
will apply to non-U.S. holders of notes.

 

U.S. federal withholding tax

 

The 30% U.S. federal withholding tax will not apply to any payment of interest
(including OID, if applicable) on the notes under the “portfolio interest rule,”
provided that:

 

•                                          interest paid on the notes is not
effectively connected with your conduct of a trade or business in the United
States;

 

•                                          you do not actually (or
constructively) own 10% or more of the total combined voting power of all
classes of our voting stock within the meaning of the Code and applicable United
States Treasury regulations;

 

•                                          you are not a controlled foreign
corporation that is related to us actually or constructively through stock
ownership;

 

•                                          you are not a bank whose receipt of
interest on the notes is described in Section 881(c)(3)(A) of the Code; and

 

•                                          either (a) you provide your name and
address on an IRS Form W-8BEN (or other applicable form), and certify, under
penalties of perjury, that you are not a United States person as defined under
the Code or (b) you hold your notes through certain foreign intermediaries and
satisfy the certification requirements of applicable United States Treasury
regulations. Special certification rules apply to non-U.S. holders that are
pass-through entities rather than corporations or individuals.

 

If you cannot satisfy the requirements described above, payments of interest
(including OID, if applicable) made to you will be subject to the 30% U.S.
federal withholding tax, unless you provide us with a properly executed:

 

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

 

•                                          IRS Form W-8BEN (or other applicable
form) certifying an exemption from or reduction in withholding under the benefit
of an applicable income tax treaty; or

 

•                                          IRS Form W-8ECI (or other applicable
form) certifying interest paid on the notes is not subject to withholding tax
because it is effectively connected with your conduct of a trade or business in
the United States (as discussed below under “—U.S. federal income tax”).

 

The 30% U.S. federal withholding tax generally will not apply to any payment of
principal or gain that you realize on the sale, exchange, retirement or other
disposition of a note.

 

U.S. federal income tax

 

If you are engaged in a trade or business in the United States and interest
(including OID, if applicable) on the notes is effectively connected with the
conduct of that trade or business (and, if required by an applicable income tax
treaty, is attributable to a United States permanent establishment), then you
will be subject to U.S. federal income tax on that interest (including OID, if
applicable)on a net income basis (although you will be exempt from the 30% U.S.
federal withholding tax, provided the certification requirements discussed above
in “—U.S. federal withholding tax” are satisfied) in generally the same manner
as if you were a United States person as defined under the Code. In addition, if
you are a foreign corporation, you may be subject to a branch profits tax equal
to 30% (or lower applicable income tax treaty rate) of such interest (including
OID, if applicable), subject to adjustments.

 

Any gain realized on the disposition of a note generally will not be subject to
U.S. federal income tax unless:

 

•                                          the gain is effectively connected
with your conduct of a trade or business in the United States (and, if required
by an applicable income tax treaty, is attributable to a United States permanent
establishment); or

 

•                                          you are an individual who is present
in the United States for 183 days or more in the taxable year of that
disposition, and certain other conditions are met.

 

Information reporting and backup withholding

 

U.S. holders

 

In general, information reporting requirements will apply to certain payments of
principal and interest (including OID, if applicable) paid on the notes and to
the proceeds of the sale or other disposition of a note paid to you (unless you
are an exempt recipient such as a corporation). Backup withholding may apply to
such payments if you fail to provide a taxpayer identification number or a
certification that you are not subject to backup withholding, or if you fail to
report in full dividend and interest income.

 

Backup withholding is not an additional tax and any amounts withheld under the
backup withholding rules may be allowed as a refund or a credit against your
U.S. federal income tax liability provided the required information is timely
furnished to the IRS.

 

Non-U.S. holders

 

Generally, we must report to the IRS and to you the amount of interest
(including OID, if applicable) paid to you and the amount of tax, if any,
withheld with respect to those payments. Copies of the

 

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information returns reporting such interest payments and any withholding may
also be made available to the tax authorities in the country in which you reside
under the provisions of an applicable income tax treaty.

 

In general, you will not be subject to backup withholding with respect to
payments of interest (including OID, if applicable) on the notes that we make to
you provided that we do not have actual knowledge or reason to know that you are
a United States person as defined under the Code, and we have received from you
the required certification that you are a non-U.S. holder described above in the
fifth bullet point under “—Certain tax consequences to non-U.S. holders—U.S.
federal withholding tax.”

 

Information reporting and, depending on the circumstances, backup withholding
will apply to the proceeds of a sale or other disposition (including a
redemption) of notes within the United States or conducted through certain
United States-related financial intermediaries, unless you certify to the payor
under penalties of perjury that you are a non-U.S. holder (and the payor does
not have actual knowledge or reason to know that you are a United States person
as defined under the Code), or you otherwise establish an exemption.

 

Backup withholding is not an additional tax and any amounts withheld under the
backup withholding rules may be allowed as a refund or a credit against your
U.S. federal income tax liability provided the required information is timely
furnished to the IRS.

 

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ANNEX C

 

Restrictions on Offers and Sales Outside the United States(1)

 

In connection with offers and sales of Securities outside the United States:

 

(a)                                  Each Initial Purchaser acknowledges that
the Securities have not been registered under the Securities Act and may not be
offered or sold within the United States or to, or for the account or benefit
of, U.S. persons except pursuant to an exemption from, or in transactions not
subject to, the registration requirements of the Securities Act.

 

(b)                                 Each Initial Purchaser, severally and not
jointly, represents, warrants and agrees that:

 

(i)                                     Such Initial Purchaser has offered and
sold the Securities, and will offer and sell the Securities, (A) as part of
their distribution at any time and (B) otherwise until 40 days after the later
of the commencement of the offering of the Securities and the Closing Date, only
in accordance with Regulation S or Rule 144A or any other available exemption
from registration under the Securities Act.

 

(ii)                                  None of such Initial Purchaser or any of
its affiliates or any other person acting on its or their behalf has engaged or
will engage in any directed selling efforts with respect to the Securities, and
all such persons have complied and will comply with the offering restrictions
requirement of Regulation S.

 

(iii)                               At or prior to the confirmation of sale of
any Securities sold in reliance on Regulation S, such Initial Purchaser will
have sent to each distributor, dealer or other person receiving a selling
concession, fee or other remuneration that purchase Securities from it during
the distribution compliance period a confirmation or notice to substantially the
following effect:

 

“The Securities covered hereby have not been registered under the U.S.
Securities Act of 1933, as amended (the “Securities Act”), and may not be
offered or sold within the United States or to, or for the account or benefit
of, U.S. persons (i) as part of their distribution at any time or (ii) otherwise
until 40 days after the later of the commencement of the offering of the
Securities and the date of original issuance of the Securities, except in
accordance with Regulation S or Rule 144A or any other available exemption from
registration under the Securities Act. Terms used above have the meanings given
to them by Regulation S.”

 

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(1)          Capitalized terms used but not defined herein have the meanings
ascribed to such terms in the Purchase Agreement (the “Purchase Agreement”) to
which this Annex C is attached.

 

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(iv)                              Such Initial Purchaser has not and will not
enter into any contractual arrangement with any distributor with respect to the
distribution of the Securities, except with its affiliates or with the prior
written consent of the Issuer.

 

(v)                                 Such Initial Purchaser has not solicited and
will not solicit offers for the Securities from, and will not offer the
Securities to, or for the account or benefit of, a resident of Canada or within
Canada, except those persons that the Initial Purchaser reasonably believes are
“accredited investors” (as defined under Canadian Securities Laws), provided,
further, that in the cause of this clause (v), in purchasing such Securities
such persons are deemed to have so represented and agreed as provided under the
caption “Representation and Agreement by Purchasers” contained in the Canadian
Offering Memorandum.

 

Terms used in paragraph (a) and this paragraph (b) and not otherwise defined in
this Agreement have the meanings given to them by Regulation S.

 

(c)                                  Each Initial Purchaser, severally and not
jointly, represents, warrants and agrees that:

 

(i)                                     it has only communicated or caused to be
communicated and will only communicate or cause to be communicated any
invitation or inducement to engage in investment activity (within the meaning of
Section 21 of the United Kingdom Financial Services and Markets Act 2000 (the
“FSMA”)) received by it in connection with the issue or sale of any Securities
in circumstances in which Section 21(1) of the FSMA does not apply to the Issuer
or the Guarantors; and

 

(ii)                                  it has complied and will comply with all
applicable provisions of the FSMA with respect to anything done by it in
relation to the Securities in, from or otherwise involving the United Kingdom.

 

(d)                                 Each Initial Purchaser acknowledges that no
action has been or will be taken by the Issuer that would permit a public
offering of the Securities, or possession or distribution of any of the Time of
Sale Information, the Offering Memorandum, any Issuer Written Communication or
any other offering or publicity material relating to the Securities, in any
country or jurisdiction where action for that purpose is required.

 

(e)                                  In connection with  offers and sales in
Canada, the Initial Purchasers represent and warrant, severally and not jointly,
(A) that they will not offer, sell or deliver Securities directly or indirectly
in Canada except pursuant to exemptions from the prospectus requirements of
Canadian Securities Laws and not in violation of a Canadian Securities Laws, and
(B) that (i) they are properly registered under the Canadian Securities Laws of
each of the applicable provinces in which Securities are offered by way of
private placement (the “Relevant Provinces”), (ii) they will distribute
Securities in any Relevant Provinces only through affiliates which are properly
registered under the Canadian Securities Laws of such Relevant Provinces and in
such case will distribute the Securities only in accordance with such
registration or (iii) they will distribute Securities in any Relevant Province
only in accordance with exemptions from the registration requirements of
applicable Canadian Securities Laws. The Initial Purchasers

 

2

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acknowledge that the Securities have not been qualified under Canadian
Securities Laws and may not be offered or sold in Canada except in accordance
with this paragraph.

 

3

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ANNEX D-1

 

[Form of Opinion of Kelley Drye & Warren LLP](2)

 

(1)                                  Each of Symmetry and the Issuer has been
duly incorporated and is validly existing and in good standing under the laws of
the State of Delaware, and has the corporate power and authority necessary to
own or hold its properties and to conduct its business as described in the
Offering Memorandum and the Time of Sale Information and is duly qualified to
transact business and in good standing in each jurisdiction listed opposite its
name in Annex B hereto.

 

(2)                                  Each of the Guarantors incorporated or
formed in the State of Delaware (the “Delaware Guarantors”) has been duly
organized, is validly existing as a corporation or limited liability company, as
the case may be, in good standing under the laws of the jurisdiction of its
organization, has the corporate or limited liability company (as applicable)
power and authority to own its property and to conduct its business as described
in the Offering Memorandum, except as otherwise noted therein, and is duly
qualified to transact business and is in good standing in each jurisdiction
listed opposite its name on Annex B hereto.

 

(3)                                  Symmetry has an authorized capitalization
as set forth in each of the Time of Sale Information and the Offering Memorandum
under the heading “Capitalization”; and all the outstanding shares of capital
stock or other equity interests of the Issuer and each of the Delaware
Guarantors have been duly and validly authorized and issued, are fully paid and
are non-assessable.

 

(4)                                  Each of Symmetry, the Issuer and each of
the Delaware Guarantors has full corporate or limited liability company (as
applicable) right, power and authority to execute and deliver each of the
Transaction Documents to which it is a party and to perform its obligations
thereunder; and all action required to be taken by it for the due and proper
authorization, execution and delivery by it of each of the Transaction Documents
to which it is a party, and the consummation by it of the transactions
contemplated thereby has been duly and validly taken.

 

(5)                                  The Indenture has been duly authorized,
executed and delivered by the Issuer, Symmetry and each of the Delaware
Guarantors and, assuming due execution and delivery thereof by the Trustee,
constitutes a valid and legally binding agreement of the Issuer, Symmetry and
each of the Guarantors enforceable against the Issuer, Symmetry and each of the
Guarantors in accordance with its terms; and the Indenture conforms in all
material respects to the requirements of the Trust Indenture Act and the
rules and regulations of the Commission applicable to an indenture that is
qualified thereunder.

 

(6)                                  The Securities have been duly authorized,
executed and delivered by the Issuer and, when duly authenticated as provided in
the Indenture and paid for as provided in the

 

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(2)          Capitalized terms used but not defined herein have the meanings
ascribed to such terms in the Purchase Agreement (the “Purchase Agreement”) to
which this Annex D-1 is attached.

 

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Purchase Agreement, will be duly and validly issued and outstanding and will
constitute valid and legally binding obligations of the Issuer enforceable
against the Issuer in accordance with their terms, and will be entitled to the
benefits of the Indenture; and the Guarantees have been duly authorized by each
of Symmetry and each of the Delaware Guarantors and, when the Securities have
been duly executed, authenticated, issued and delivered as provided in the
Indenture and paid for as provided in the Purchase Agreement, will be valid and
legally binding obligations of each of Symmetry and each of the Guarantors, as
applicable, enforceable against each of Symmetry and each of the Guarantors in
accordance with their terms, and will be entitled to the benefits of the
Indenture.

 

(7)                                  The Exchange Securities (including the
related guarantees) have been duly authorized by the Issuer, Symmetry and each
of the Delaware Guarantors, and, when duly executed, authenticated, issued and
delivered as contemplated by the Registration Rights Agreement, will be duly and
validly issued and outstanding and will constitute valid and legally binding
obligations of the Issuer, as issuer, and each of Symmetry and each of the
Guarantors, as guarantor, enforceable against the Issuer, Symmetry and each of
the Guarantors, as applicable, in accordance with their respective terms, and
will be entitled to the benefits of the Indenture.

 

(8)                                  The Purchase Agreement has been duly
authorized, executed and delivered by the Issuer, Symmetry and Novamerican Steel
Holdings, Inc. (“Holdings”) and, when duly executed and delivered by the other
parties thereto, will constitute a valid and legally binding agreement of the
Issuer, Symmetry and Holdings enforceable against the Issuer, Symmetry and
Holdings in accordance with its terms. The Registration Rights Agreement has
been duly authorized, executed and delivered by the Issuer, Symmetry and each of
the Delaware Guarantors and, when duly executed and delivered by the other
parties thereto, will constitute a valid and legally binding agreement of the
Issuer, Symmetry and each of the Guarantors enforceable against the Issuer,
Symmetry and each of the Guarantors in accordance with its terms.

 

(9)                                  The Collateral Agreement has been duly
authorized, executed and delivered by each of the Issuer, Symmetry and each of
the Delaware Guarantors and, assuming due execution and delivery thereof by the
other parties thereto, constitutes a valid and legally binding agreement of each
of the Issuer, Symmetry and each of the Guarantors enforceable against each of
the Issuer, Symmetry and each of the Guarantors in accordance with its terms;
and the Intercreditor Agreement has been duly authorized, executed and delivered
by the Issuer, Symmetry and each of the Delaware Guarantors and, assuming due
execution and delivery thereof by the other parties thereto, constitutes a valid
and legally binding agreement of the Issuer, Symmetry and each of the Guarantors
enforceable against the Issuer, Symmetry and each of the Guarantors in
accordance with its terms.

 

(10)                            The Intercreditor Agreement has been duly
authorized, executed and delivered by the Issuer, Symmetry and each of the
Delaware Guarantors and, when duly executed and delivered by the other parties
thereto, will constitute a valid and legally binding agreement of the Issuer and
each of the Post Transaction Subsidiaries (to the extent it is a party thereto),
enforceable against the Issuer and each of the Post Transaction Subsidiaries (to
the extent it is a party thereto) in accordance with its terms.

 

2

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(11)                            The Joinder Agreement has been duly authorized,
executed and delivered by the Issuer, Symmetry and each of the Delaware
Guarantors.

 

(12)                            Assuming due authorization, execution and
delivery thereof by the parties thereto (other than the Company, the Issuer and
the Delaware Guarantors), and without consideration of any laws of Canada which
may be applicable thereto, each Transaction Document governed by the laws of the
State of New York is, or will be, a valid and legally binding agreement of
Novamerican Steel (to the extent Novamerican Steel is, or will be, a party
thereto), enforceable against Novamerican Steel in accordance with its terms.

 

(13)                            Assuming due authorization, execution and
delivery of the Intercompany Note by 632421 N.B. Ltd., a New Brunswick Company
(“632421”), and without consideration of any laws of Canada which may be
applicable thereto, the Intercompany Note (which is governed by the laws of the
State of New York) is a valid and legally binding agreement of 632421,
enforceable against 632421 in accordance with its terms.

 

(14)                            Each Transaction Document conforms in all
material respects to the description thereof contained in each of the Time of
Sale Information and the Offering Memorandum.

 

(15)                            The execution, delivery and performance by each
of the Issuer, Symmetry, Novamerican Steel and each of the Guarantors of each of
the Transaction Documents to which it is a party, the issuance and sale of the
Securities (including the Guarantees) and compliance by each of the Issuer,
Symmetry and each of the Guarantors with the terms thereof and the consummation
of the transactions contemplated by the Transaction Documents to the extent
applicable to them will not (i) conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under, or result
in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of Symmetry or any of the Post Transaction Subsidiaries
pursuant to, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument known to us to which Symmetry or any of the Post
Transaction Subsidiaries is a party or by which Symmetry or any of the Post
Transaction Subsidiaries is bound or to which any of the property or assets of
Symmetry or any of the Post Transaction Subsidiaries is subject, (ii) result in
any violation of the provisions of the certificate or incorporation, certificate
of formation, by-laws, operating agreement or similar organizational documents
of Symmetry, the Issuer or any of the Delaware Guarantors or (iii) result in the
violation of any law or statute or, to our knowledge, any judgment, order, or
decree of any court or governmental or regulatory authority, having jurisdiction
over Symmetry or any of the Post Transaction Subsidiaries except, (A) in the
case of clauses (i) and (iii) above, for any such conflict, breach, violation or
default that would not, individually or in the aggregate, result in a Material
Adverse Effect and (B) in the case of clause (i) above, with respect to liens
arising under the Transaction Documents.

 

(16)                            No consent, approval, authorization, order,
registration or qualification of or with any court or arbitrator or governmental
or regulatory authority is required for the execution, delivery and performance
by Symmetry, the Issuer, Novamerican and each of the Guarantors of any of the
Transaction Documents to which each is a party, the issuance and sale of the
Securities (including the Guarantees) and compliance by each of Symmetry, the
Issuer and

 

3

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each of the Guarantors with the terms thereof and the consummation by them of
the transactions contemplated by the Transaction Documents on their part to be
consummated, except for such consents, approvals, authorizations, orders and
registrations or qualifications (i) as may be required under applicable state
securities laws in connection with the purchase and resale of the Securities
(including the Guarantees) by the Initial Purchasers, (ii) as may be required
with respect to the Exchange Securities (including the related guarantees) under
the Securities Act and applicable state securities laws as contemplated by the
Registration Rights Agreement or (iii) to the extent that the failure to obtain
a consent, approval, authorization, order, registration or qualification, in
each case related solely to the consummation of the Acquisition and not to any
financing transactions (including the offering and sale of the Securities)
related thereto, would not, individually or in the aggregate, have a Material
Adverse Effect.

 

(17)                            To our knowledge, except as described in each of
the Time of Sale Information and the Offering Memorandum, there are no legal,
governmental or regulatory investigations, actions, suits or proceedings pending
to which Symmetry or any of the Post Transaction Subsidiaries is or might
reasonably be expected to be a party or to which any property of Symmetry or any
of the Post Transaction Subsidiaries is or may be the subject that we believe,
individually or in the aggregate, if determined adversely to Symmetry or any of
the Post Transaction Subsidiaries, would reasonably be expected to have a
Material Adverse Effect; and to our knowledge, no such investigations, actions,
suits or proceedings are threatened or contemplated by any governmental or
regulatory authority or threatened by others.

 

(18)                            The descriptions in each of the Time of Sale
Information and the Offering Memorandum of the Securities and any United States
statutes, legal, governmental and regulatory proceedings; and the statements in
each of the Time of Sale Information and the Offering Memorandum under the
heading “Certain Federal Income Tax Considerations”, in each case, insofar as
such descriptions or statements constitute summaries of the terms of the
Securities, legal matters, documents or proceedings referred to therein, fairly
summarize the matters described therein in all material respects.

 

(19)                            Neither Symmetry nor any of the Post Transaction
Subsidiaries is, and after giving effect to the offering and sale of the
Securities and the application of the proceeds thereof as described in each of
the Time of Sale Information and the Offering Memorandum, none of them will be,
an “investment company” or an entity “controlled” by an “investment company”
within the meaning of the Investment Company Act.

 

(20)                            Neither the issuance, sale and delivery of the
Securities nor the application of the proceeds thereof by the Issuer as
described in each of the Time of Sale Information and the Offering Memorandum
will violate Regulation T, U or X of the Board of Governors of the Federal
Reserve System.

 

(21)                            Assuming the accuracy of the representations,
warranties and agreements of Symmetry, the Issuer, Novamerican Steel, the
Guarantors and the Initial Purchasers contained in the Purchase Agreement and
the Joinder Agreement, it is not necessary, in connection with the issuance and
sale of the Securities to the Initial Purchasers and the offer, resale and
delivery of the Securities by the Initial Purchasers in the manner contemplated
by the Purchase Agreement, the Time of Sale Information and the Offering
Memorandum, to register the Securities under the

 

4

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Securities Act or to qualify the Indenture under the Trust Indenture Act, it
being understood that no opinion is expressed as to any subsequent resale of any
of the Securities.

 

(22)                            The Collateral Agreement is effective to create
in favor of the U.S. Collateral Agent, for the benefit of the Secured Parties, a
security interest in the Collateral described therein in which a security
interest may be created under Article 9 of the New York UCC.

 

(23)                            Upon delivery to the U.S. Collateral Agent in
the State of New York of all certificates evidencing the Pledged Securities
described on Annex C hereto (such certificates, the “Certificates”), issued or
endorsed in the name of the U.S. Collateral Agent or in blank or together with
stock powers or note powers properly executed in the name of the U.S. Collateral
Agent or in blank, the security interest in such Pledged Securities described on
Annex C hereto in favor of the U.S. Collateral Agent, for the benefit of the
Secured Parties, will be perfected and assuming that the U.S. Collateral Agent
has taken possession of the Certificates and such accompanying endorsements or
powers without notice, at or prior to the time of delivery thereof to the U.S.
Collateral Agent, of any adverse claim within the meaning of
Section 8-102(a)(i) of the New York UCC, the U.S. collateral Agent has acquired
a security interest in such Pledged Securities free of any adverse claim.

 

(24)                            The UCC-1 financing statements (the “Financing
Statements”) in the forms attached as Annex D hereto are in appropriate form for
filing in the office of the Secretary of the State of Delaware (the “Delaware
Filing Office”). Upon filing of the Financing Statements in the Delaware Filing
Office, the security interest of the U.S. Collateral Agent, for the benefit of
the Secured Parties, in the Collateral described therein will be perfected under
the UCC in effect in the State of Delaware (the “Delaware UCC”) to the extent
that a security interest in such Collateral can be perfected by the filing of a
financing statement in the Delaware Filing Office.

 

5

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ANNEX D-2

 

[Form Of Opinion of Davies Ward Phillips & Vineberg LLP And Stewart Mckelvey](3)

 

(1)                                  Novamerican is a corporation amalgamated
under the Canada Business Corporations Act.

 

(2)                                  632421 N.B. Ltd. (“632421”) is a
corporation incorporated under the New Brunswick Business Corporations Act.

 

(3)                                  632422 N.B. Ltd. (“632422”) is a
corporation incorporated under the New Brunswick Business Corporations Act.

 

(4)                                  The authorized capital of Novamerican
consists of an unlimited number of common shares and an unlimited number of
preferred shares. Novamerican Steel Finco Inc. is the registered holder of [   ]
common shares of Novamerican, which represents all of the issued and outstanding
share capital of Novamerican (the “Novamerican Pledged Shares”).

 

(5)                                  All necessary corporate action has been
taken by Novamerican to authorize the pledge and transfer of the Novamerican
Pledged Shares(4) in favour of the U.S. Collateral Agent, for the benefit of the
Secured Parties, pursuant to the US Collateral Agreement.(5)

 

(6)                                  The authorized capital of 632422 consists
of an unlimited number of common shares without nominal or par value.
Novamerican is the registered holder of [   ] common shares of 632422 which
represents all of the issued and outstanding share capital of 632422 (the
“632422 Pledged Shares”).

 

(7)                                  All necessary corporate action has been
taken by 632422 to authorize the pledge and transfer of the 632422 Pledged
Shares in favour of the Canadian Collateral Agent for the benefit of the Issuer,
pursuant to the Canadian Collateral Agreement.(6)

 

(8)           Each of Novamerican and 632421 has the corporate power and
authority to execute and deliver each of the Transaction Documents to which it
is a party and to perform its obligations thereunder. All corporate action
required to be taken by Novamerican or 632421, as applicable, for the due and
proper authorization, execution and delivery of each of the Transaction
Documents has been duly and validly taken. (7)

 

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(3)          Capitalized terms used but not defined herein have the meanings
ascribed to such terms in the Purchase Agreement (the “Purchase Agreement”) to
which this Annex C is attached.

(4)          This refers to the shares of the Issuer in Novamerican.

(5)          If the restrictions on transfer are removed, this opinion is not
required.

(6)          If the restrictions on transfer are removed, this opinion is not
required.

(7)          Corporate opinions on 632421 to be given by NB counsel, where
applicable.

 

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(9)                                  Each of the Intercreditor Agreement, the
Joinder Agreement and the Intercompany Note(s) has been duly executed and
delivered by Novamerican and 632421, as applicable, to the extent that
Applicable Laws(8) apply to such execution and delivery. (9)

 

(10)                            Each of the Canadian Security Documents to which
Novamerican is a party has been duly executed and delivered by Novamerican and
constitutes a legal, valid and binding obligation of Novamerican enforceable
against Novamerican in accordance with its terms.

 

(11)                            The Intercompany Note(s) to which 632421 is a
party has been duly executed and delivered by 632421.

 

(12)                            The execution, delivery and performance by
Novamerican of each of the Transaction Documents to which it is a party and
compliance by Novamerican with the terms thereof and the consummation of the
transactions contemplated by the Transaction Documents and the Plan of
Arrangement does not (i) result in any violation of the provisions of the
articles or by-laws of Novamerican or (ii) result in the violation of any
Applicable Laws.

 

(13)                            The execution, delivery and performance by
632421 of each of the Transaction Documents to which it is a party and
compliance by 632421 with the terms thereof and the consummation of the
transactions contemplated by the Transaction Documents and the Plan of
Arrangement does not (i) result in any violation of the provisions of the
articles or by-laws of 632421 or (ii) result in the violation of any Applicable
Laws.

 

(14)                            No consent, approval, authorization, order,
registration or qualification of or with any court or governmental or regulatory
authority is required at this time in connection with the execution, delivery
and performance by Novamerican of any of the Transaction Documents to which it
is a party and compliance by Novamerican with the terms thereof and the
consummation of the transactions contemplated by the Transaction Documents,
other than the registration of the Quebec Hypothec in the relevant registries.

 

(15)                            No consent, approval, authorization, order,
registration or qualification of or with any court or governmental or regulatory
authority is required at this time in connection with the execution, delivery
and performance by 632421 of any of the Transaction Documents to which it is a
party and compliance by 632421 with the terms thereof and the consummation of
the transactions contemplated by the Transaction Documents.

 

(16)                            The Arrangement is effective as of the date
hereof in accordance with subsection 192(8) of the Canada Business Corporations
Act.

 

(17)                            By virtue of Applicable Laws, Novamerican is
liable for all of the obligations of 632421 under the Intercompany Note(s).

 

(18)                            The Canadian Collateral Agreement creates valid
security interests in favour of the Canadian Collateral Agent, in the
Intercompany Note Collateral to which the Ontario Personal Property Security Act
(Ontario) (“PPSA”) applies in which Novamerican now has

 

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(8)          To be defined in each opinion.

(9)          Corporate opinions on 632422 to be given by NB counsel, where
applicable.

 

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rights to secure payment and performance of its obligations under the
Intercompany Note(s) and is sufficient to create valid security interests in
favour of the Collateral Agent in the Intercompany Note Collateral to which the
PPSA applies in which Novamerican hereafter acquires rights when those rights
are acquired by Novamerican, securing payment and performance of the obligations
under the Intercompany Note.

 

(19)                            The security interest of the U.S. Collateral
Agent in the Novamerican Pledged Shares represented by certificated securities
(as defined in the Securities Transfer Act, 2006 (Ontario)) has been perfected
by control (as defined in the Securities Transfer Act, 2006 (Ontario)) of the
Novamerican Pledged Shares by the U.S. Collateral Agent and accordingly the
security interest of the U.S. Collateral Agent has priority over any other
security interest in the Novamerican Pledged Shares to which the
PPSA applies.(10)

 

(20)                            The security interest of the Canadian Collateral
Agent in the 632422 Pledged Shares represented by certificated securities (as
defined in the Securities Transfer Act, 2006 (Ontario)) has been perfected by
control (as defined in the Securities Transfer Act, 2006 (Ontario)) and
accordingly the security interest of the Canadian Collateral Agent has priority
over any other security interest in the 632422 Pledged Shares to which the PPSA
applies.(11)

 

(21)                            Upon registration of the Canadian Mortgage at
the relevant land registry office, the charge created thereunder will constitute
a good and valid charge, enforceable against the mortgagee in accordance with
its terms to secure payment and performance of the obligations of Novamerican
under the Intercompany Note(s).

 

(22)                            The Quebec Hypothec creates a valid hypothec in
favour of the Canadian Collateral Agent, as fondé de pouvoir, up to a principal
amount of CDN$400,000,000.00 with interest thereon at the rate of  25% per annum
in the Charged Property (as defined in the Quebec Hypothec) to secure the
payment and performance of Novamerican’s obligations under the Intercompany
Note(s).

 

(23)                            Registration has been made in all public offices
provided under the laws of Ontario as are necessary to preserve, protect or
perfect the security interest created under the Canadian Collateral Agreement.
No further or subsequent filings, recordings or registrations in the Province of
Ontario are necessary in order to preserve or perfect the security interests
created by the Canadian Collateral Agreement.(12)

 

(24)                            Attached as a schedule to this opinion is a
report showing the results of the searches conducted in the public offices and
registries in Ontario under the statutes specified therein against the current
legal name of Novamerican and all former names of Novamerican disclosed by such
counsel’s corporate search and of its predecessors by amalgamation and current
as of the respective currency dates indicated therein. Such statutes are the
only statutes of Ontario where liens of the types expressed to be created by or
under the Canadian Collateral Agreement in personal property would ordinarily or
customarily be the subject of a filing,

 

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(10)    This opinion to be given if it has been determined that perfection by
control occurs in Ontario.

(11)    This opinion to be given if it has been determined that perfection by
control occurs in Ontario.

(12)    Note that confirmation of registration of the Quebec Hypothec will only
become available after the issuance of this opinion. Similar opinion to be
provided by Quebec counsel once Quebec Hypothec is registered.

 

3

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registration or recording in order to create, preserve, perfect and protect the
liens expressed to be created thereby or thereunder. The only filings,
registrations or recordings against the current or former names of Novamerican
disclosed by such searches are set out in such schedule.

 

(25)                            In any proceeding in a court of competent
jurisdiction in the Province of Ontario (an “Ontario Court”) for the enforcement
of the Transaction Documents(13), the Ontario Court would apply the laws of the
State of New York (“New York Law”), in accordance with the parties’ choice of
New York Law in the Transaction Documents, to all issues which under the
conflict of laws rules of the Province of Ontario are to be determined in
accordance with the proper law of a contract, provided that:

 

(a)                                  the parties’ choice of New York Law in the
Transaction Documents is bona fide and legal and there is no reason for avoiding
the choice on the grounds of public policy, as such criteria would be applied by
the Ontario Court; and

 

(b)                                 in any such proceeding, and notwithstanding
the parties’ choice of New York Law in the Transaction Documents, the Ontario
Court:

 

 

(i)

will not take judicial notice of the provisions of New York Law, but will only
apply such provisions if they are pleaded and proven by expert testimony;

 

 

 

 

(ii)

will apply Applicable Laws that under Applicable Laws would be characterized as
procedural and will not apply any New York Law that under Applicable Laws would
be characterized as procedural;

 

 

 

 

(iii)

will apply provisions of Applicable Laws that have overriding effect;

 

 

 

 

(iv)

will not apply any New York Law if its application would be contrary to public
policy, as such term is interpreted under Applicable Laws (“Public Policy”);

 

 

 

 

(v)

will not apply any New York Law if such application would be characterized under
Applicable Laws as the direct or indirect enforcement of a foreign revenue,
expropriatory, penal or other public law; and

 

 

 

 

(vi)

will not enforce the performance of any obligation that is illegal under the
laws of any jurisdiction in which the obligation is to be performed.

 

(26)                            An Ontario Court would give a judgment based
upon a final and conclusive in personam judgment of a court exercising
jurisdiction in the State of New York (a “New York Court”) for a sum certain,
obtained against the Corporation with respect to a claim arising out of the
Transaction Documents (a “New York Judgment”), without reconsideration of the
merits(14):

 

(a)                                  provided that:

 

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(13)    This opinion should be limited to documents governed by New York law.

(14)    This opinion should be limited to documents where there is submission to
a New York court.

 

4

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(i)

an action to enforce the New York Judgment is commenced in the Ontario Court
within any applicable limitation period;

 

 

 

 

(ii)

the Ontario Court has discretion to stay or decline to hear an action on the New
York Judgment if the New York Judgment is under appeal or there is another
subsisting judgment in any jurisdiction relating to the same cause of action as
the New York Judgment;

 

 

 

 

(iii)

the Ontario Court will render judgment only in Canadian dollars; and

 

 

 

 

(iv)

an action in the Ontario Court on the New York Judgment may be affected by
bankruptcy, insolvency or other laws affecting the enforcement of creditors’
rights generally; and

 

 

 

(b)                                 subject to the following defences:

 

 

(i)

that the New York Judgment was obtained by fraud or in a manner contrary to the
principles of natural justice;

 

 

 

 

(ii)

that the New York Judgment is for a claim which under Applicable Laws would be
characterized as based on a foreign revenue, expropriatory, penal or other
public law;

 

 

 

 

(iii)

that the New York Judgment is contrary to Public Policy or to an order made by
the Attorney General of Canada under the Foreign Extraterritorial Measures Act
(Canada) or by the Competition Tribunal under the Competition Act (Canada) in
respect of certain judgments referred to in these statutes; or

 

 

 

 

(iv)

that the New York Judgment has been satisfied or is void or voidable under New
York Law.

 

(27)                            In any proceeding in a court of competent
jurisdiction in the Province of Québec (a “Québec Court”) for the enforcement of
the Transaction Documents, the Québec Court would recognize the choice of New
York Law as the proper law governing the Transaction Documents as chosen by the
parties therein and apply such law to issues which under conflict of law
rules of Québec are to be dealt with in accordance with the governing law of the
Transaction Documents, provided that(15):

 

(c)                                  such choice of law is bona fide (in the
sense that it was not made with a view to avoiding the consequences of the laws
of any other jurisdiction) and such choice of law is not manifestly inconsistent
with public order, as that term is understood in international relations by a
Québec Court (Article 3081 C.C.Q.); and

 

(d)                                 in any such proceeding, and notwithstanding
the parties’ choice of New York Law:

 

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(15) This opinion should be limited to documents governed by New York law.

 

5

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(i)

the Québec Court will not take judicial notice of the New York Law unless it has
been pleaded and its content established and, if required by the Québec Court,
proof of such New York Law has been made by, among other means, expert testimony
or the production of a certificate drawn up by a jurisconsult (Article 2809
C.C.Q.);

 

 

 

 

(ii)

the Québec Court will not apply the provisions of New York Law if their
application would be manifestly inconsistent with public order as understood in
international relations (Article 3081 C.C.Q.);

 

 

 

 

(iii)

if the Transaction Documents contain no foreign element, they will be subject to
the mandatory provisions of the law of the jurisdiction which would apply if
none were designated (Article 3111 para. 2 C.C.Q.);

 

 

 

 

(iv)

evidence will be governed by the law applicable to the merits of the dispute,
subject to any rules of the Québec Court which are more favourable to the
establishment of evidence (Article 3130 C.C.Q.);

 

 

 

 

(v)

matters of procedure will be governed by the laws of the Province of Québec
(Article 3132 C.C.Q.);

 

 

 

 

(vi)

the Québec Court will apply provisions of the laws of the Province of Québec and
the federal laws of Canada applicable therein, that have overriding effect
(Article 3076 C.C.Q.); and

 

 

 

 

(vii)

the Québec Court will not directly or indirectly enforce the obligations
resulting from the taxation laws of foreign jurisdictions unless in such foreign
jurisdictions the obligations resulting from the taxation laws of Québec are
recognized and enforced.

 

(28)                            Upon a motion brought before it, a Québec Court
would recognize and declare enforceable a final and enforceable civil judgment
in personam, not subject to ordinary remedy, for a sum certain of a New York
Court against the parties to the Transaction Documents in connection with an
action arising out of said Transaction Documents if(16):

 

(e)                                  the New York Court rendering such judgment
had jurisdiction, as recognized by the Québec Court (Article 3155(1) C.C.Q.);

 

(f)                                    such judgment was not obtained by fraud
or in a manner contrary to natural justice or in contravention of the
fundamental principles of procedure (Article 3155(3) C.C.Q.);

 

(g)                                 a dispute between the same parties, based on
the same facts and having the same object, has not given rise to a decision
rendered in the Province of Québec, whether it has acquired the authority of a
final judgment (res judicata) or not, or is not pending before a Québec
authority, in the first instance, or has been decided

 

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(16) This opinion should be limited to documents where there is submission to a
New York court.

 

6

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in another jurisdiction but the decision does not meet the necessary conditions
for recognition in the Province of Québec (Article 3155(4) C.C.Q.);

 

(h)                                 the outcome of such foreign judgment is not
manifestly inconsistent with public order as understood in international
relations (Article 3155(5) C.C.Q.) or contrary to any order made by the Attorney
General of Canada under the Foreign Extraterritorial Measures Act (Canada) or by
the Competition Tribunal under the Competition Act (Canada) in respect of
certain judgments referred to in these statutes;

 

(i)                                     such judgment does not directly or
indirectly enforce obligations arising from taxation laws of foreign
jurisdictions unless in such foreign jurisdictions the obligations resulting
from the taxation laws of Québec are recognized and enforced, or arising from
other laws of a public nature, such as expropriatory or penal laws
(Article 3155(6) and 3162 C.C.Q.); and

 

(j)                                     the motion to enforce such judgment is
commenced in the Province of Québec within applicable limitation periods in the
Province of Québec.

 

(29)                            The distribution of the Securities by the
Initial Purchasers to purchasers in each of the provinces of [   ] will be
exempt from the prospectus requirements of the applicable Canadian securities
laws and no filing, proceeding, approval, consent or authorization is required
to be made, taken or obtained under said securities laws to permit the
distribution by the Initial Purchasers of the Securities to the purchasers in
each such province, other than such filings as are required to be made pursuant
to National Instrument 45-106 – Prospectus and Registration Exemptions.

 

(30)                            The first trade of the Securities in each of the
provinces of [   ], other than a trade which is otherwise exempt under
applicable Canadian securities laws, will be a distribution but will not be
subject to the prospectus requirements of such securities laws, provided that at
the date of such trade:

 

(k)                                    The Issuer is and has been a reporting
issuer in a jurisdiction of Canada for the four months immediately preceding the
date of such first trade;

 

(l)                                       at least four months and one day have
elapsed from the “distribution date” (as such term is defined in National
Instrument 45-102 - Resale of Securities (“NI 45-102”) of the Securities;

 

(m)                                 the certificates representing the Securities
carry the legend, or an ownership statement issued under a direct registration
system or other electronic book-entry system acceptable to the regulator bears a
legend restriction notation, to the effect provided by Section 2.5(2)3(b) of NI
45-102;

 

(n)                                   the trade is not a “control distribution”
(as such term is defined in NI 45-102);

 

7

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(o)                                 no unusual effort is made to prepare the
market or to create a demand for the Securities that are the subject of the
trade;

 

(p)                                 no extraordinary commission or consideration
is paid to a person or company in respect of the trade;

 

(q)                                 if the selling security holder is an
“insider” or “officer” of the Issuer (as such terms are defined under the
applicable securities laws), the selling security holder has no reasonable
grounds to believe that the Issuer is in default of “securities legislation” (as
such term is defined in National Instrument 14-101 (“NI 14-101”)); and

 

(r)                                    in the case of the first trades subject
to the securities laws of the Province of Manitoba, the trade is not a “control
distribution” as such term is defined in NI 45-102 and is not a transaction
involving a purchase or sale or a repurchase or resale that is incidental to a
“primary distribution to the public” as defined under the securities laws of the
Province of Manitoba.

 

In rendering such opinion, such counsel may rely as to matters of fact on
certificates of responsible officers of Novamerican and public officials that
are furnished to the Initial Purchasers. Such opinion shall include customary
qualifications, limitations and assumptions.(17)

 

The opinion of Davies Ward Phillips & Vineberg LLP described above shall be
rendered to the Initial Purchasers at the request of Novamerican and shall so
state therein.

 

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(17) Davies will rely on New Brunswick counsel for New Brunswick opinions, where
applicable.

 

8

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ANNEX D-3

 

[Form of Opinion of Nutter, McClennen & Fish, LLP](18)

 

1.                                       American Steel and Aluminum
Corporation, a Massachusetts corporation (“MA Guarantor”) is validly existing as
a corporation under Massachusetts law and in good standing with the Secretary of
The Commonwealth of Massachusetts, is authorized to transact business as a
foreign corporation in the states listed on Schedule 3. MA Guarantor has the
corporate power (i) to own its properties and conduct its business as described
in the Preliminary Offering Memorandum and the Offering Memorandum and (ii) to
execute and deliver the Transaction Documents in which it is named as a party
and to perform its obligations thereunder.

 

2.                                       MA Guarantor has duly authorized,
executed, and delivered the Transaction Documents in which it is named as a
party, and such Transaction Documents constitute its valid and binding
agreements enforceable against it in accordance with their terms.

 

3.                                       The execution and delivery by each of
the MA Guarantor of the Transaction Documents to which it is a party does not
and the performance by it of its obligations thereunder will not (i) violate
Massachusetts law or federal law, (ii) to our knowledge violate any court order,
judgment, or decree applicable to the MA Guarantor, or (iii) violate its charter
or by-laws.

 

4.                                       All the outstanding shares of capital
stock or other equity interests of the MA Guarantor have been duly and validly
authorized and issued, are fully paid and are non-assessable.

 

5.                                       No consent, approval, license, or
exemption by, or order or authorization of, or filing, recording, or
registration with, any governmental authority is required to be obtained by the
MA Guarantor in connection with the execution and delivery of the Transaction
Documents to which it is a party or the performance by it of its obligations
thereunder, except as provided in paragraphs 6 and 7 hereof.

 

6.                                       The provisions of the Collateral
Agreement are effective under the Uniform Commercial Code as in effect in The
Commonwealth of Massachusetts (the “UCC”) to create a valid security interest in
the Collateral Agent’s favor in so much of the Collateral (as defined in the
Collateral Agreement) as constitutes personal property to which Article 9 of the
UCC is applicable. Under the UCC, while a debtor is located in a jurisdiction,
the local law of that jurisdiction governs the perfection of a non-possessory
security interest by the filing of a financing statement. The MA Guarantor is
located, for purposes of the UCC, in Massachusetts. The UCC-1 financing
statements attached hereto as Exhibit B are in appropriate form for filing with
the Massachusetts Secretary of the Commonwealth. Accordingly, upon the due
filing of the UCC-1 financing statements attached hereto as Exhibit B with the
Massachusetts Secretary of the Commonwealth, in accordance with Section 9-516 of
the UCC, the Collateral Agent will have a perfected security interest in such
portion of the Collateral in which the perfection of a security interest can be
effected by the filing of a financing statement under the UCC.

 

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(18) Capitalized terms used but not defined herein have the meanings ascribed to
such terms in the Purchase Agreement (the “Purchase Agreement”) to which this
Annex D-3 is attached.

 

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7.                                       The MA Mortgages when (A) duly executed
by the president and treasurer (B) notarized and (C) delivered with the
appropriate legal descriptions attached, will:

 

(A)               BE IN PROPER FORM FOR RECORDING WITH THE APPROPRIATE REGISTRY
OF DEEDS LISTED ON SCHEDULE 1 FOR THE COUNTY IN WHICH THE MORTGAGED PROPERTY IS
LOCATED, PROVIDED THAT THE MA MORTGAGES MUST BE RECORDED WITH A CERTIFICATE OF
LEGAL EXISTENCE AND GOOD STANDING OF THE MA GUARANTOR ISSUED BY THE SECRETARY OF
THE COMMONWEALTH OF MASSACHUSETTS; AND

 

(b)              when recorded in the Registry of Deeds listed on Schedule 1
next to the name of the Mortgaged Property, create in favor of the Collateral
Agent a legal, valid and binding lien on the real property and fixtures
described in each MA Mortgage, enforceable as such against the MA Guarantor.

 

8.                                       No taxes or other charges, including,
without limitation, intangible or documentary stamp taxes, mortgage or recording
taxes, transfer taxes or similar charges, are payable to Massachusetts or to any
jurisdiction therein on account of the execution or delivery or recording or
filing of the MA Mortgages or any of the other Transaction Documents or the
creation of the indebtedness evidenced or secured by any of the Transaction
Documents, as applicable, except for nominal filing or recording fees.

 

9.                                       The recording of the MA Mortgages with
the registries of deeds described on Schedule 1 are the only actions, recordings
or filings necessary to publish notice and protect the validity of and to
establish of record the rights of the parties under the MA Mortgages.

 

10.                                 Upon the assumption that all of the
applicable provisions of Massachusetts law relating to the preservation of the
right to seek a deficiency after the foreclosures of real property have been
complied with by the Collateral Agent, the transfer of all or any portion of the
Mortgaged Property in connection with the exercise of any remedy under the MA
Mortgages, including, without limitation, by way of judicial foreclosure, will
not restrict, affect or impair the liability of the MA Guarantor with respect to
the indebtedness secured thereby or the Collateral Agent’s rights or remedies
relating thereto, including the foreclosure or enforcement of any other security
interest or liens securing such indebtedness, and the laws of Massachusetts do
not require a lienholder to elect to pursue its remedies either against
mortgaged real property or personal property where such lienholder holds
security interests and liens on both real and personal property of a debtor.

 

11.                                 The courts of Massachusetts will enforce
those provisions in the Transaction Documents which provide that the validity,
construction and enforceability of the Transaction Documents will be governed by
the laws of New York, provided, however, that the courts of Massachusetts
may apply the internal law of Massachusetts to determine the perfection and the
effect of perfection or nonperfection of the liens created under such documents
and the application of remedies in enforcing such liens with respect to property
located in Massachusetts.

 

12.                                 Under the Massachusetts criminal usury
statute, M.G.L. Chapter 271, Section 49 of the General Laws of the Commonwealth
of Massachusetts (the “Massachusetts Usury Statute”), “any lender subject to
control, regulation or examination by any state or federal regulatory

 

2

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agency” is exempt from the provisions thereof. With your permission, we have
assumed that each of the Initial Purchasers is subject to state and/or federal
control, regulation or examination within the meaning of the Massachusetts Usury
Statute. Based on such assumption, the Transaction Documents executed by the MA
Guarantor will not violate the Massachusetts Usury Statute. If all or any
portion of the Securities were transferred to or otherwise held by an entity
that is not a “lender subject to control, regulation or examination by any state
or federal regulatory agency,” we note that subsection (d) of the Massachusetts
Usury Statute provides, in relevant part, that, subject to compliance with the
further conditions thereof, the provisions of the Massachusetts Usury Statute
“shall not apply to any person who notifies the attorney general of his intent
to engage in a transaction or transactions which . . . would be proscribed [by
the Massachusetts Usury Statute] . . . providing [sic] any such person maintains
records of any such transaction.” Accordingly, assuming the application of
currently existing statutory, regulatory, and decisional law in the Commonwealth
of Massachusetts with respect to usury, any subsequent holder of all or any of
the Securities that is not a lender subject to state or federal regulation would
not be subject to the usury prohibition contained in Massachusetts Usury
Statute, provided such holder (i) files the requisite notice with the
Massachusetts Attorney General, (ii) does not publicly advertise the fact of
such notification nor use the fact of such notification to solicit business
(except that such notification may be revealed to an individual upon his
inquiry), (iii) maintains records of the applicable transaction(s) described in
the notice, which records must contain the name and address of the applicable
borrower(s), the amount borrowed, the interest and expenses to be paid by the
applicable borrower(s), the date that each loan is made and the date or dates on
which any payment is due, (iv) makes such records available to the Attorney
General of Massachusetts for the purposes of inspection upon any request
received from the Attorney General, (v) notifies the Attorney General if such
holder’s name and/or address changes and (vi) renews such notification prior to
the second anniversary of the filing thereof.

 

13.                                 Entering into the Transaction Documents with
the MA Guarantor will not in and of itself cause the Collateral Agent or any
Initial Purchaser to be found to be transacting business (requiring that they
register under Massachusetts corporate law as a foreign corporation) or doing
banking business in Massachusetts.

 

3

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Exhibit A

 

[FORM OF REGISTRATION RIGHTS AGREEMENT]

 

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Exhibit B

 

[Form of Joinder Agreement]

 

$315,000,000

 

NOVAMERICAN STEEL FINCO INC.

 

11.5% Senior Secured Notes due 2015

 

JOINDER TO THE PURCHASE AGREEMENT

 

J.P. Morgan Securities Inc.

As Representative of the

several Initial Purchasers listed

in Schedule 1 to the Purchase Agreement

c/o J.P. Morgan Securities Inc.

270 Park Avenue

New York, New York 10017

 

Ladies and Gentlemen:

 

Reference is made to the Purchase Agreement dated November 14, 2007 (the
“Purchase Agreement”), among Novamerican Steel Finco Inc., a Delaware
corporation (the “Issuer”), Symmetry Holdings Inc., a Delaware corporation,
Novamerican Steel Holdings Inc., a Delaware corporation, and J.P. Morgan
Securities Inc., as representative for the several initial purchasers listed in
Schedule 1 thereto (the “Initial Purchasers”), concerning the purchase of the
Securities (such term and each other capitalized term used but not defined
herein having the meaning assigned to it in the Purchase Agreement) from the
Issuer by the Initial Purchasers. This Joinder Agreement (this “Agreement”) is
the Joinder Agreement referred to in Section 6(n) of the Purchase Agreement.

 

Each of the Issuer, Novamerican Steel and the Guarantors agree that this
Agreement is being executed and delivered in connection with the issue and sale
of the Securities pursuant to the Purchase Agreement and to induce the Initial
Purchasers to purchase the Securities thereunder. This Agreement is being
executed on the Closing Date, concurrently with the consummation of the sale of
Securities pursuant to the Purchase Agreement and the consummation of the other
Transactions.

 

1.                                       Joinder. Each of Novamerican Steel and
the Guarantors listed on Schedule 1 hereto hereby agrees to be become bound by
the terms, conditions and other provisions of the Purchase Agreement as
Novamerican Steel or a Guarantor, as applicable, with all attendant rights,
duties and obligations stated therein, with the same force and effect as if
originally named therein as a party and as if such party executed the Purchase
Agreement on the date thereof.

 

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2.                                       Representations, Warranties and
Agreements of the Issuer, Novamerican Steel and the Guarantors. The Issuer,
Novamerican Steel and the Guarantors, jointly and severally, represent and
warrant to, and agree with, each Initial Purchaser on and as of the date hereof
that:

 

(a)                                  Each of the Issuer, Novamerican Steel and
the Guarantors has the corporate or other organizational power to execute and
deliver this Agreement and all corporate or other organizational action required
to be taken by each of them for the due and proper authorization, execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated hereby has been duly and validly taken; this Agreement
has been duly authorized, executed and delivered by each of the Issuer,
Novamerican Steel and the Guarantors and constitutes a valid and legally binding
agreement of each of the Issuer, Novamerican Steel and the Guarantors,
enforceable against each of the Issuer, Novamerican Steel and the Guarantors in
accordance with its terms, subject to the Enforceability Exceptions;

 

(b)                                 the representations, warranties and
agreements set forth in Section 3 of the Purchase Agreement are true and correct
on and as of the date hereof; and

 

(c)                                  Nothing has come to the attention of the
Issuer or any of the Guarantors that has caused the Issuer or any of the
Guarantors to believe that the statistical and market-related data included in
each of the Time of Sale Information and the Offering Memorandum is not based on
or derived from sources that are reliable and accurate in all material respects.

 

3.                                       GOVERNING LAW. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

4.                                       Consent to Jurisdiction. Any legal
suit, action or proceeding arising out of or based upon this Agreement or the
transactions contemplated hereby (the “Related Proceedings”) may be instituted
in the federal courts of the United States located in the City and County of New
York or the courts of the State of New York in each case located in the City and
County of New York (collectively, the “Specified Courts”), and each party
irrevocably submits to the exclusive jurisdiction (except for suits, actions, or
proceedings instituted in regard to the enforcement of a judgment of any
Specified Court in a Related Proceeding (each such judgment, a “Related
Judgment”), as to which such jurisdiction is non-exclusive) of the Specified
Courts in any Related Proceeding. Service of any process, summons, notice or
document by mail to such party’s address set forth above shall be effective
service of process for any Related Proceeding brought in any Specified Court.
The parties irrevocably and unconditionally waive any objection to the laying of
venue of any Specified Proceeding in the Specified Courts and irrevocably and
unconditionally waive and agree not to plead or claim in any Specified Court
that any Related Proceeding brought in any Specified Court has been brought in
an inconvenient forum. Each party not located in the United States irrevocably
appoints CT Corporation System as its agent to receive service of process or
other legal summons for purposes of any Related Proceeding that may be
instituted in any Specified Court.

 

2

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5.                                       Waiver of Immunity. With respect to any
Related Proceeding, each party irrevocably waives, to the fullest extent
permitted by applicable law, all immunity (whether on the basis of sovereignty
or otherwise) from jurisdiction, service of process, attachment (both before and
after judgment) and execution to which it might otherwise be entitled in the
Specified Courts and, with respect to any Related Judgment, each party waives
any such immunity in the Specified Courts or any other court of competent
jurisdiction and will not raise or claim or cause to be pleaded any such
immunity at or in respect of any such Related Proceeding or Related Judgment,
including, without limitation, any immunity pursuant to the United States
Foreign Sovereign Immunities Act of 1976, as amended.

 

6.                                       Judgment Currency. If for the purposes
of obtaining judgment in any court it is necessary to convert a sum due
hereunder into any currency other than U.S. dollars, the parties hereto agree,
to the fullest extent that they may effectively do so, that the rate of exchange
used shall be the rate at which in accordance with normal banking procedures the
Initial Purchasers could purchase U.S. dollars with such other currency in New
York City on the business day preceding that on which final judgment is given.
The obligations of the Issuer, Novamerican Steel and each Guarantor in respect
of any sum due from them to any Initial Purchaser shall, notwithstanding any
judgment in any currency other than U.S. dollars, not be discharged until the
first business day, following receipt by such Initial Purchaser of any sum
adjudged to be so due in such other currency, on which (and only to the extent
that) such Initial Purchaser may in accordance with normal banking procedures
purchase U.S. dollars with such other currency; if the U.S. dollars so purchased
are less than the sum originally due to such Initial Purchaser hereunder, the
Issuer, Novamerican Steel and each Guarantor agree, as a separate obligation and
notwithstanding any such judgment, to indemnify such Initial Purchaser against
such loss. If the U.S. dollars so purchased are greater than the sum originally
due to such Initial Purchaser hereunder, such Initial Purchaser agrees to pay to
the Issuer, Novamerican Steel and the Guarantors (but without duplication) an
amount equal to the excess of the U.S. dollars so purchased over the sum
originally due to such Initial Purchaser hereunder.

 

7.                                       Counterparts. This Agreement may be
signed in counterparts (which may include counterparts delivered by any standard
form of telecommunication), each of which shall be an original and all of which
together shall constitute one and the same instrument.

 

8.                                       Amendments or Waivers. No amendment or
waiver of any provision of this Agreement, nor any consent or approval to any
departure therefrom, shall in any event be effective unless the same shall be in
writing and signed by the parties hereto.

 

9.                                       Headings. The headings herein are
inserted for convenience of reference only and are not intended to be part of,
or to affect the meaning or interpretation of, this Agreement.

 

3

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If the foregoing is in accordance with your understanding, please indicate your
acceptance of this Agreement by signing in the space provided below.

 

 

Very truly yours,

 

 

 

NOVAMERICAN STEEL FINCO INC.,

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

SYMMETRY HOLDINGS INC.,

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

NOVAMERICAN STEEL HOLDINGS INC.,

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

INTEGRATED STEEL INDUSTRIES, INC.,

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

AMERICAN STEEL AND ALUMINUM

 

CORPORATION,

 

 

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

NOVA TUBE AND STEEL, INC.,

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

4

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NOVAMERICAN STEEL INC.,

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

NOVAMERICAN TUBE HOLDINGS, INC.,

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

NOVA TUBE INDIANA, LLC,

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

Accepted: November 15, 2007

 

J.P. MORGAN SECURITIES INC.

 

For itself and on behalf of the
several Initial Purchasers listed
in Schedule 1 to the Purchase Agreement.

 

By

 

 

 

 

Authorized Signatory

 

 

 

5

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Schedule 1

 

Joining Parties

 

Integrated Steel Industries, Inc.

 

American Steel and Aluminum Corporation

 

Nova Tube and Steel, Inc.

 

Novamerican Tube Holdings, Inc.

 

Nova Tube Indiana, LLC

 

Novamerican Steel Inc.

 

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