EX-10.1



 






Exhibit 10.1









October 7, 2004



Mr. Thom Golatzki

Vice President Engineering, Energy & Materials

NEWPORT STEEL CORPORATION

530 W. Ninth Street

Newport, KY 41072



Dear Thom:



This letter sets forth a quotation from the Nucor Steel Crawfordsville Division
of Nucor Corporation (“Nucor”) to Newport Steel Corporation (“Newport”) for the
sale and purchase of the products listed on Exhibit B, attached hereto and
incorporated herein by reference (the “Products”). Upon acceptance, Nucor will
reserve in its mill the production time required to supply the Products.



Upon acceptance, Nucor agrees to sell and Newport agrees to purchase those
quantities of Products (+/- 10%) at the prices set forth on Exhibit B, together
with the extras set forth on Exhibit C (plus all other applicable extras) and a
raw-material surcharge computed as follows:





	 	•	 	For shipments from the commencement date of January 1, 2005
through December 31, 2005, the applicable raw-material surcharges for
shipments in a given month shall be computed as follows: AMM Chicago
“Consumer Buying Price” for No. 1 Busheling minus $170.00 per ton.
In the event the AMM Chicago “Consumer Buying Price” for No. 1
Busheling is equal to or less than $170.00 per ton, there will be no
surcharge added to the invoice.
	 
	 	•	 	The AMM Chicago “Consumer Buying Price” for No. 1 Busheling
shall be determined as reported in American Metal Markets during the
3rd week of the previous month




The term of this Agreement shall be for a period of twelve (12) months,
commencing on January 1, 2005 and ending on December 31, 2005. Payment terms
shall be [***]. All orders from Newport will be subject to normal order lead
times. Newport will supply annual, quarterly, and monthly estimates of its
ordering schedule. Except as modified by this letter, Nucor’s standard terms
and conditions of sale, a copy of which is attached as Exhibit A, shall apply
to all sales.



Please indicate your agreement to the terms and conditions of this letter by
promptly signing it where indicated below and returning a copy to your Nucor
Regional Sales Manager. If Nucor has not received your executed copy of this
letter by Thursday, October 7, 2004, this quotation will be considered null and
void. Acceptance of the transactions described herein shall occur when your
executed copy of this letter is received and executed by Nucor. Nucor
appreciates your business.




	 	 	 
	AGREED TO:

	 	AGREED TO AND ACCEPTED:
	

	 	 
	NEWPORT STEEL CORPORATION

	 	NUCOR CORPORATION
	

	 	 
	By:  /s/ Thomas L. Golatzki

	 	By:  /s/ Timothy W. Hill
	
 

	 	
 
	Its:  Vice President

	 	Its:  Sales Manager
	
 

	 	
 
	Execution Date: October 7, 2004

	 	Acceptance Date: October 8, 2004
	
 

	 	
 






[***   Indicates portions of this exhibit that have been omitted and separately filed with the Securities and Exchange Commission pursuant to a request for confidential treatment.]




 









 





Exhibit A




TERMS AND CONDITIONS OF SALE



All sales by Nucor Corporation, and its affiliates and subsidiaries
(collectively “Nucor”) are made subject to the following terms and conditions.
Nucor expressly rejects any different or additional terms or conditions
contained in any documents submitted by Buyer. Nucor’s provision of credit,
acceptance of any purchase order and/or sale of any goods are expressly made
conditional on Buyer’s assent to these terms and conditions. All orders by
Buyer may be accepted only upon issuance of Nucor’s sales order
acknowledgement.




     1. Except as otherwise agreed in a writing signed by Buyer and Nucor, the
applicable Nucor sales order acknowledgement, together with these terms and
conditions constitute the entire agreement between Nucor and Buyer relating to
the sale of such goods by Nucor. Terms or conditions contained in any document
issued by Buyer that in any manner purport to alter, modify, change, suspend,
or add to any term or condition contained herein shall be deemed excluded from
such Buyer document and waived by Buyer. [***]



     2. The purchase price of the goods shall be [***].



     3. Buyer cannot modify, cancel, or otherwise alter orders without Nucor’s
written consent. Any such cancellation, modification, or alteration shall be
subject to conditions as negotiated at such time, which shall include
protection of Nucor against loss.



     4. All deliveries are F.O.B. Nucor’s shipping facility, freight prepaid or
freight collect to destination. If shipped freight prepaid, the charge for
freight will be added to the invoice. Neither freight charges nor tax is
subject to any discount. Risk of loss or damage in transit shall be borne by
Buyer, and claims shall be made directly with carrier. Buyer may pick up the
goods at Nucor’s shipping facility provided Buyer does so within 10 days after
the date Buyer is notified of the availability of goods. Nucor reserves the
right to ship without further notification at any time after the 10-day period.



     5. Delivery dates are approximate. Neither Buyer nor Seller shall be
liable for any delay in or inability to complete the performance of the
Agreement because of unforeseen circumstances beyond either party’s respective
control, such as acts of God; inability to obtain raw materials, electricity,
fuel or parts; industrial conflicts (including without limitation strikes,
lockouts and work interruptions); government rules, regulations, suspensions or
requisitions of any kind; fires; casualties or accidents. Either party
affected by a force majeure event shall promptly upon learning of such event
give notice to the other party, stating the nature of the force majeure event,
its anticipated duration, and all actions being taken to avoid or minimize its
effect.



     6. SUBJECT TO STANDARD MANUFACTURING VARIATIONS, NUCOR WARRANTS THAT THE
GOODS FURNISHED HEREUNDER SHALL MEET SPECIFICATIONS SET FORTH ON THE FACE OF
THE APPLICABLE NUCOR SALES ORDER ACKNOWLEDGEMENT. NUCOR MAKES NO OTHER
WARRANTIES, EXPRESS OR IMPLIED, AND SPECIFICALLY EXCLUDES ALL WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.



     7. No claim for damages for goods that do not conform to specifications
will be allowed unless Nucor is given immediate notice after delivery of goods
to the first destination to which they are shipped and allowed an opportunity
to inspect them. Goods for which damages are claimed shall not be returned,
repaired, or discarded without Nucor’s written consent. BUYER’S EXCLUSIVE
REMEDY AGAINST NUCOR, AND NUCOR’S SOLE OBLIGATION, FOR ANY AND ALL CLAIMS,
WHETHER FOR BREACH OF CONTRACT, WARRANTY, TORT (INCLUDING NEGLIGENCE), OR
OTHERWISE, SHALL BE LIMITED TO NUCOR’S REPLACING GOODS THAT DO NOT CONFORM TO
SPECIFICATIONS OR, AT NUCOR’S OPTION, REFUNDING THE PURCHASE PRICE. IN NO
EVENT SHALL NUCOR HAVE ANY LIABILITY FOR DAMAGES IN AN AMOUNT EXCEEDING THE
PURCHASE PRICE OF THE GOODS SOLD HEREUNDER, NOR SHALL NUCOR HAVE ANY LIABILITY
FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES.



     8. If, in Nucor’s opinion, Buyer’s credit becomes impaired, Nucor may
suspend performance until such time as Nucor has received full payment for any
goods already delivered or in process and is satisfied (in its sole discretion)
as to Buyer’s credit for future deliveries. If Nucor suspends performance and
later proceeds with such order, Nucor shall be entitled to such extension of
time for performance as is necessitated by the suspension.



     9. All taxes of any kind levied by any federal, state, municipal or other
governmental authority, which tax Nucor is required to collect or pay with
respect to the production, sale, or shipment of goods sold to Buyer shall be
the responsibility of Buyer. Buyer agrees to pay all such taxes and further
agrees to reimburse Nucor for any such payments made by Nucor.



     10. Checks or payments, whether full or partial, received from or for the
account of Buyer, regardless of writings, legends, or notations upon such
checks or payments, or regardless of other writings, statements, or documents,
shall be applied by Nucor against any amount owing by Buyer with full
reservation of all of Nucor’s rights, without an accord and satisfaction of
Buyer’s liability.



     11. In the event Buyer fails to make payment to Nucor, or any affiliate of
Nucor, of any amounts due and owing to Nucor or such affiliate (including any
applicable surcharge or freight charge), Nucor shall have the right to
terminate any Buyer order or any unfulfilled portion thereof, and Nucor or any
affiliate thereof may terminate any other agreement between Nucor or such
affiliate and Buyer. Nucor may charge interest on the outstanding balance at
an annual rate of 12% or the highest rate allowed by law (whichever is less).
Nucor shall have the right to employ an attorney to collect the balance due,
and Buyer agrees to pay all collection costs incurred by Nucor, including its
reasonable attorneys’ fees.



     12. This agreement shall be governed by the laws of the state in which
Nucor’s shipping facility is located. Buyer, acting for itself and its
successors and assigns, hereby expressly and irrevocably consents to the
exclusive jurisdiction of the state and federal courts of that state for any
litigation which may arise out of or be related to this agreement. Buyer
waives any objection based on forum non conveniens or any objection to venue of
any such action.



     13. Nucor reserves the right to enforce these terms and conditions at any
time and none shall be deemed waived unless such waiver is in writing signed by
a duly authorized officer of Nucor. All rights and remedies granted herein are
in addition to all remedies available at law or in equity.


[***] Indicates portions of this exhibit that have been omitted and separately filed with the Securities and Exchange Commission pursuant to a request for confidential treatment.]




 









 





Exhibit B





	•	 	An aggregate quantity of [***] (+/- 10%) [HR Coil:
[***]] for the period January 1, 2005 through December 31, 2005.
The ordered releases as follows:





	 	 	 	 	 
	

	 	Crawfordsville, IN:
	 	[***]
	

	 	 	 	 
	

	 	Hickman, AR:
	 	[***]
	

	 	 	 	 
	

	 	Decatur, AL:
	 	[***]
	

	 	 	 	 
	

	 	Tuscaloosa, AL:
	 	[***]








	•	 	A base price of [***] actual billing weight for hot
roll based material. All width, gauge, grade, and packaging
extras to apply. Grade extras published on ‘Exhibit C’. [***]






	•	 	A’re-opener’ to be conducted at 6-months (6/3/05).
Base price to be adjusted with a maximum potential of [***]
adjustment. Such adjustment shall be based on the difference
between the Steel Base Price Midwest HR Sheet published in AMM
as of Friday ending, December 31, 2004 and such price as
published on Friday June 3, 2005. Price adjustments to be in
effect, with shipments, beginning on the first day of July 2005.




[***] Indicates portions of this exhibit that have been omitted and separately filed with the Securities and Exchange Commission pursuant to a request for confidential treatment.]









 









 











Exhibit C



GRADE EXTRAS: [***]




	 	 	 	 	 	 	 
	NEWPORT

STEEL
	 	Newport

Specification
	 	Current Adder

($/cwt)
	 	New Adder ($/cwt)
	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	







[***]



New Adder Extras effective, with shipments, beginning on January 1, 2005.



[***] Indicates portions of this exhibit that have been omitted and separately filed with the Securities and Exchange Commission pursuant to a request for confidential treatment.]