Exhibit 10.2

 

ARCELOR WAIVER

 

October 14, 2004

To: ARCELOR

19 Avenue de la Liberté

L2930 Luxembourg

Attn: M. Guy Dollé – Président de la Direction Générale

 

Re.: Waiver

 

Reference is made to the Shareholders Agreement of Companhia Siderurgica de
Tubarao (“CST”) dated May 25, 1995, as amended on May 20, 1996 and further
amended on January 24, 1997 (“Shareholders Agreement”)

 

Pursuant to Article III of the Shareholders Agreement, any transfer of the CST
shares which are bound by the Shareholders Agreement (such CST shares are
referred to as the “Affected Shares”) by any party thereto is subject to the
right of first refusal of the other parties thereto.

 

California Steel Industries, Inc. ( “CSI”) and ARCELOR entered into a Call and
Put Option Agreement on the same date as hereof which stipulates ARCELOR’s
option to purchase and CSI’s option to sell all of the Affected Shares held by
CSI with either option being exercisable during the period of May 26, 2005
through June 25, 2005.

 

In view of the execution of the Call and Put Option Agreement, we hereby
irrevocably waive our rights of first refusal under the Shareholders Agreement
with respect to any possible acquisition by ARCELOR or its affiliates of any
Affected Shares held by any party to the Shareholders’ Agreement.

 

In consideration of the said waiver which will be valid and in full force and
effect as from the date hereof, we will receive from ARCELOR the amount of
US$1.50 (one U.S. dollar and fifty cents) for one and each thousand Affected
Shares held by us, totaling a net receivable amount of US$ 1,179,979.50 (one
million, one hundred and seventy nine thousand, nine hundred and seventy nine
U.S. dollars and fifty cents), through telegraphic transfer on an account to be
indicated by CSI at least 3 (three) business days before the due date for the
payment, within 10 (ten) business days from this date.

 

Should ARCELOR fail to pay such amount, the waiver of our first refusal rights
hereunder will be cancelled and such rights of ours will be reinstated without
any notice or actions of ours, provided that such failure is not a consequence
of the default of CSI of its aforementioned information duty. The payment
described above shall be fully earned upon execution of this waiver and shall
not be contingent upon the exercise of the Options contained in the Call and Put
Option Agreement or refundable if such Options are not exercised.

 

If you agree with the terms of this waiver, please return a signed copy of this
letter to Mr.

Ricardo Bernardes.

 

Yours Truly,

 

/s/ Ricardo Bernardes

 

CALIFORNIA STEEL INDUSTRIES, INC.

 

 

Accepted and agreed:

 

/s/ Michel Wurth

 

 

ARCELOR