Document:

Exhibit 10.2

 

Exhibit A

 

By
Laws of

Apolo
Tubulars S.A.

(in process of
transformation)

Chapter I

Name, Head Office, Legal Jurisdiction, Corporate Purpose and Term

Article 1.                  The Company is designated
Apolo Tubulars S.A.

Article 2.                  The Company shall have its
head office and legal jurisdiction in the City of Lorena, State of São Paulo,
and may upon decision of the Board of Directors, open, keep or close, branches,
main branches, agencies, offices and warehouses in any part of Brazil or
abroad.

Article 3.                  The Company’s corporate
purpose is (a) to manufacture, process and finish steel pipes for the
conduction of gas and liquid substances, to the production and exploitation of
oil and gas, (b) to export, sell and distribute steel pipes and accessories and
components thereof (c) to participate in or make investments in other companies
in order to expand its steel pipes business and (d) to import and purchase
steel pipes from outside of Brazil to sell in Brazil.

Article 4.                  The Company has an indefinite
term of duration.

Chapter II

Capital Stock and Shares

Article 5.                  The Company’s stock capital is
of R$[·], ([·] Reais), divided into [·]
([·])
common shares, nominative, with no par value.

Sole Paragraph:      The Company may issue preferred shares,
with or without voting rights, in one or more classes of shares, even granting 

 

more rights than the ones
granted to the existing shares, with redemption rights or not, up to fifty
percent of the number of shares in which the stock capital is divided, being
established the respective preferences and rights.

Article 6.                  Each common share entitles its
holder to one (1) vote at the Company’s Shareholders’ Meetings.

Article 7.                  The Company may issue stock
certificates or documents (cautelas) that represent the shares. The Company may
also issue multiple certificates of stock.

Sole Paragraph:      The certificates representing the Company’s
shares shall be signed by two (2) Officers or, in case of absence or
impossibility, by two (2) attorneys-in-fact with specific powers to practice
such action.

Article 8.                  The Company may keep all its
shares in deposit, in the name of its owners, in the institution designated by
it, without the issuance of certificates. 

Article 9.                  The Company may issue
debentures, convertible in shares, which shall give their holders a credit
right against it, in the terms approved by the Board of Directors, pursuant to
Article [·] of these Bylaws. 

Chapter III

Shareholders’ Meetings

Article 10.                The conditions to hold a General
Shareholders’ Meeting, including the manner of the call and holding of the
meeting, the necessary number of shareholders in attendance, and the
resolutions and preliminary acts, shall be as provided for in the Law and in
these Bylaws.

Sole Paragraph:      All documents analyzed or discussed at the
General Shareholders’ Meetings must be available to the shareholders 

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at the Company’s head
offices, on the date of publication of the first call notice for the
shareholders’ meeting. In case of absence of the publication of the call
notice, the shareholders shall be notified by registered letter regarding the
availability of the documents to be reviewed and/or copied.

Article 11.                The resolutions at the
Shareholders’ Meetings shall be approved by a majority vote of those
shareholders attending the meeting, provided that the following matters shall
require the supermajority vote of Shareholders representing ninety-five percent
(95%) of the Company’s voting capital:

I – any amendments to the
Company’s Bylaws;

II – any capital increase,
except for (a) those required to effect the investments that are necessary to
achieve the corporate purposes of the Company; and (b) the incorporation of
reserves or provided by law;

III – stock split or reverse
split of stocks, redemption or purchase of shares for cancellation or to be kept
at treasury, issuance or transfer by the Company of any securities of the
Company, either convertible or not into stocks, such as debentures,
subscription bonds, beneficiary parts or call options or stock subscription, or
the granting of any rights or privileges for the acquisition of stocks;

IV – merger, spin off,
corporation conversion, consolidation, or the liquidation of the Company;

V – the authorization to the
Officers to file for bankruptcy, judicial restructuring or to enter into
extraordinary agreements with creditors;

VI – the amortization of any
Company’s debit with any Shareholder, or any affiliate of a Shareholder, or any
payment or distribution of Company’s assets to any Shareholder, or any
affiliate of a Shareholder;

VII – the establishment of the
global compensation of the members of the Board of Directors and of the Board
of Officers, and their participation in the Company’s profits, being observed
the global limits;

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VIII – any material change in
the Company’s business or the adoption of any action which may lead to or
result in such material change; and

IX – any other matters provided
for in Section 136 of Law Nr. 6.404/76 (“Corporation Law”).

Article 12.                The Company’s Shareholders’
Meetings shall be ordinarily held within the first four (4) months following
the end of each fiscal year and, special meetings, whenever necessary.

Sole Paragraph:      The Special Shareholders’ Meetings may
be called (i) by the Board of Directors, (ii) at the request of any Shareholder
which owns at least twenty-five per cent (25%) of the voting shares, or (iii)
in order to comply with any legal requirement.

Article 13.                The Company’s Ordinary and
Special Shareholders’ Meetings shall be installed and presided by the Chairman
of the Board of Directors, and in case of his absence, by any individual
attending the Shareholders’ Meeting and appointed by the Shareholders, and the
secretary shall be an attendant, Shareholder or not, appointed by the chairman
of the Meeting.

Article 14.                At the Company’s Shareholder’s
Meetings, only the owners of shares whose name is registered in the book of
registration of nominative shares, at least 48 hours prior to the meeting, will
be admitted.

Sole Paragraph:      Any shareholder can be represented in the
Shareholder’s Meetings by an attorney in fact with powers granted for no longer
than one year, who is a shareholder, a Company’s manager, or a lawyer, and this
document must be deposited in the Company’s head office no later than 24 hours
before the hour scheduled for the meeting. 

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Chapter IV

Management

Article 15.                The Company shall be managed by
a Board of Directors and a Board of Officers, according to the law and these
Bylaws.

Paragraph 1:           The members of the Board of Directors
shall be appointed for a term of office of three (3) years, re-election being
permitted.

Paragraph 2:            The members of the Board of Officers
shall be appointed for a term of office of three (3) years, re-election being
permitted.

Paragraph 3:           The managers shall be elected to
their positions by means of signature of the investiture statement at the Book
of Minutes of Meetings of the Board of Directors or Board of Officers, as the
case may be, and shall remain in their respective offices until their
successors are elected to their positions, except as otherwise provided for in
the respective instrument of removal from office.

Article 16.                The General Shareholders’
Meetings shall establish global compensation of the Board of Directors and the
Board of Officers, and their participation in the Company’s profits, provided,
in this case, the global limits. The Board of Directors shall distribute the
compensation established among its members and the members of the Board of
Officers.

Section IV. A

Board of Directors

Article 17.                The Board of Directors,
collectively, shall be elected at the Shareholders’ Meeting, and shall be
comprised of six (6) members, all shareholders of the Company. The Chairman and
the Vice-Chairman shall be appointed amongst the Directors elected at the
General Shareholders’ Meeting.

Sole Paragraph:      The Chairman of the Board of Directors,
when absent or unable to perform his/her duties, such duties shall be performed
by the Vice-Chairman.

Article 18.                The Board of Directors shall
hold regular meetings quarterly, on such dates previously established at the
meetings of the Board of Directors, and special meetings whenever it is called
by the Chief Executive Officer or by any Director.

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Paragraph 1:           The meetings shall be called by
means of  written notice sent to each
member of the Board of Directors, at least eight (8) days in advance.  The written notice shall describe the
subjects of the agenda and shall not be required if the Directors attending the
meeting at the beginning of such meeting do not object to the transaction of
any business because the meeting is not lawfully called or convened. 

Paragraph 2:           Notwithstanding the formalities
provided for in paragraph before, the Board of Directors’ Meetings shall be
deemed duly called when all Directors, are in attendance.

Paragraph 3:           At all meetings of the Board of
Directors, the presence of at least five (5) Directors shall constitute a
quorum. The resolutions shall be approved by the majority vote of the Directors
attending the meeting, except for the provisions of Paragraph 4 below.

Paragraph 4:           The following matters shall be
approved only upon the affirmative vote of at least five (5) members of the
Board of Directors:

(a)           the sale of all or substantially all
of the assets of the Company or of any of its subsidiaries, in each case
whether or not resulting in any distribution or payment of any cash or property
to the debt holders or Shareholders of the Company;

(b)           authorization, declaration or payment
of any dividends, including intermediary dividends, or any other distribution
with respect to Common Shares;

(c)           authorization, issuance or creation
of any debt or debt securities of the Company or of any of its subsidiaries;

 

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(d)           formation of, acquisitions of, or
investments in, businesses (or part thereof) or direct or indirect
subsidiaries, by the Company or any of its subsidiaries (whether through
assets, shares or other securities);

(e)           disposition of any business or investment
(or part thereof) by the Company or any of its subsidiaries (whether through
assets, shares or other securities, other than the disposal of assets
constituting inventory in the ordinary course of business);

(f)            removal of the CEO or the CFO;

(g)           approval of the Annual Business Plan;
provided, that if the Annual Business Plan is not approved, then the prior year’s
Annual Business Plan will remain in effect (increased by 3%) until such time
when a new Annual Business Plan is approved;

(h)           interim changes to the Company’s
budget contained in the Annual Business Plan greater than two percent (2%) for
any line item individually or four percent (4%) in the aggregate;

(i)            to the extent not contained in the
Annual Business Plan:

(i)            any Contracts, or series of related
contracts, written or oral, of the Company or any of its subsidiaries with a
value over the life of such contract, or contracts, in excess of R$[•], except for the renewal of any contract made on market terms
and contracts for the purchase and sale of Tubular Products in the ordinary
course of business;

(ii)           any incurrence of indebtedness, other
than third party accounts payable incurred in the ordinary course of business,
not in excess of R$[•] in any one instance or R$[•] in the
aggregate annually;

(iii)          any satisfaction or discharge of any
indebtedness or any payment of any obligation of the Company or any of its
subsidiaries in excess of R$[•], other than in the ordinary course of business or in 

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accordance
with the payment scheme contained in any documentation previously approved by
the Board of Directors;

(iv)         any waiver of a right or indebtedness
owed to the Company or its subsidiaries exceeding R$[•] individually or R$[•] in the aggregate annually;

(v)          changes to the compensation of, or the
creation of any new compensation plans for, any Officer of the Company or any
of its subsidiaries, or the hiring, firing or changes to the compensation or
material duties of any Officer;

(vi)         adoption, amendment, modification or
termination of any individual or group employee retirement plan or any other
welfare benefit plan or policy if the annual costs of adopting, approving,
modifying, amending or terminating such plan would exceed R$[•];

(vii)        any commitment relating to a loan to or
guarantee of any obligation of any person in excess of R$[•], provided that no loan or guarantee which is
not related to the business of the Company shall be authorized;

(viii)       the instigation or settlement of any
claim, suit, action, case or proceeding involving (x) an amount in dispute in
excess of R$[•] or (y) threats to the reputation of the Company, any of its
subsidiaries, or any of its Directors or Shareholders;

(ix)          removal or changes in the Company’s,
or any subsidiary’s Auditors;

(x)           any entry into any consulting agreement
or similar arrangement in excess of R$[•] annually;

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(xi)          annual capital expenditures in fixed
assets by the Company and its subsidiaries in excess of R$[•] individually or R$[•] in the aggregate annually;

(xii)         any material change to the accounting policies
of the Company and/or any of its subsidiaries; and

(xiii)        any transactions between the Company and
its Shareholders or any of its Shareholders’ associate, controlled or
controlling companies.

Paragraph
5:        The
minutes of the meetings of the Board of Directors shall be transcribed in the
proper book, signed by the attendants, and shall be registered in the book of
Minutes of Meetings of the Board of Directors and registered with the
Commercial Registry and published in case it contains resolutions which may
affect third parties.

Article
19.            Besides
the duties conferred to the Board of Directors by these Bylaws and the law, the
Board of Directors is competent to:

I – set forth
the general orientation of the Company’s business;

II – decide on opening or closing
of main branches, branches, agencies, representative offices or any other
similar establishment in Brazil and abroad;

III – elect and remove the Officers
of the Company and establish their duties;

IV – oversee the management of the
officers, and review, at any time, the books and documents of the Company,
request information regarding contracts entered or to be entered into by the
Company, and any other acts;

V – call Shareholders’ Meetings;

VI – discuss the management’s
report and govern and manage the Board of Officer’s accounts;

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VII – approve the disposal of
fixed assets (bens do ativo permanente), waiver
of the Company’s rights in the creation and perfection of security interest in
regards to the Company’s real state, as well as the grant of guarantees on
behalf of the Company

VIII – decide
on the payment of interim dividends and submit the allocation of net profits of
the fiscal year to approval at the Shareholders’ Meetings;

IX – discuss
and oversee any matter to be submitted to the Shareholders’ Meetings;

X – establish
the general employment guidelines of the Company and the criteria related to
compensation, rights and benefits of employees, and establishing the respective
expenses;

XI – authorize
the granting of guaranty in favor of companies in which the Company has,
directly or indirectly, any equity interest;

XII – submit
amendments of these Bylaws for approval at Shareholders’ Meetings;

XIII – approve
the acquisition of assets; and

XIV – decide
on matters omitted in these Bylaws.

Article 20.             The Chairman of the Board of
Directors, besides their duties as a Director, is competent to:

I – call
the General Shareholders’ Meetings, when the Board of Directors decides to hold
it;

II – call,
convene and preside over the meetings of the Board of Directors, pursuant to
the provisions of these Bylaws;

III – inform
to the Board of Officers and to the General Shareholders’ Meeting, when
applicable, the resolutions approved by the Board of Directors; and

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IV – receive
the notifications sent to the Board of Directors.

Article
21.            The Shareholder part of the shareholders’ agreement filed at the head offices
of the Company may oppose before the Commercial Registry the request or filing
of minutes of meetings of the Board of Directors that contain a resolution
contrary to the provisions of the shareholders’ agreement.

SECTION IV. B

BOARD OF OFFICERS

Article 22.           The Board of Officers is the
executive body and management of the Company. The Board of Officers is
comprised of two (2) to six (6) Officers, one designated as Chief Executive
Officer  (“CEO”) and an other as Chief
Financial Officer (“CFO”).  The
remaining officers without any specific designation, except as otherwise
provided for in their respective election. 
The officers shall have their duties established by the Board of
Directors, in accordance with the provisions of these Bylaws.

Paragraph 1:       In case the office of the CEO is vacant,
the Board of Directors shall be immediately called to elect a substitute. In
case the office of any other Officer is vacant, the body will keep working with
the other Officers, and the Board of Directors shall be immediately called to
elect the new Officer, provided that the Board of Directors may decide to leave
this office vacant, provided that the Company has, at least two Officers.

Paragraph 2:       The Officers, within their respective
duties, have the power to manage the corporate business and any affairs related
to the corporate purposes of the Company, subject to the restrictions provided
for in these Bylaws, and related to transactions: (1) that may only be effected
upon the prior resolution of the Board of Directors or the Board of Officers,
(2) complying with the provisions of Article 24 of these Bylaws, and (3) the
prohibition of granting of any guaranties by the Company’s Officers.

 

 11

 

Article
23.             The Board of
Officers shall meet whenever the corporate interests so require, if it is
called by any Officer, upon the prior notice of five (5) days, being regularly
convened, independent of such formality, the meeting attended by all the members
of the Board of Officers.

Sole
Paragraph:  The resolutions
shall be taken by the majority vote of the Officers attending the meeting and
the respective minutes shall be transcribed in the Book of Minutes of Meetings
of the Board of Officers.

Article
24.            The Company shall
be represented actively and passively by the Officers according to this
Article.

Paragraph
1:        The Company may
only undertake obligations by the joint signature of two Officers, acting
jointly; or one Officer acting jointly with one attorney-in-fact, with specific
powers to practice such acts; or two attorneys-in-fact with specific powers to
practice the act, jointly.

Paragraph
2:        In the following
cases, the Company may be represented by a sole Officer or a sole
attorney-in-fact:

I – endorsement of titles for
the purpose of collection or deposit, on behalf of the Company, before
financial institutions,

II – represent the Company before
the Court; and

III – ministerial acts before
governmental bodies in the federal, state and local levels, public agencies and
other governmental entities, including, but not limited to, the foreign trade
desk of Banco do Brasil, financial institutions authorized to act in the
currency exchange market, the first and fifth sections of the federal customs
in Rio de Janeiro, the other sections of the federal customs in Brazil, the
Central Bank of Brazil, Industrial Development Council (Conselho de
Desenvolvimento Industrial — CDI), Customs Policy Council (Conselho de Política Aduaneira — CPA), Rio de Janeiro Port
Operations Company (Companhia Docas do Rio de
Janeiro), airline companies, maritime companies and any ports and
airports in Brazil, the Non-Ferrous and Steelmaking Council (Conselho de Não-Ferrosos e 

 12
 

 

Siderurgia
— CONSIDER), as well as all activities related with customs
clearance regulated by Section 560 of Decree No. 91,030/85 (Customs
Regulation).

Paragraph 3:    The
powers-of-attorney shall expressly specify the powers granted and shall be
executed by two Officers, and, except for the powers of attorney granted with ad judicia powers or to defend the
Company’s interests in administrative procedures, they
must have an specified term of validity no longer than one year.

Paragraph 4:    The Officers and
attorneys-in-fact are prevented from practicing any acts not in accordance with
the corporate purposes, as well as, without the prior and express consent of
the Board of Directors, to give guarantees and incur in obligations in favor of
third parties, having no effect to the Company the acts practiced in violation of
this provision.

Article
25.         The Board of Officers, as
a collective body, is competent to:

I – propose the annual budget of
the Company;

II – propose the creation and
extinction of branches, main branches, agencies, representative offices or any
other similar establishment within Brazil or abroad;

III – comply with and enforce the
policy and general orientation of the business of the Company as set forth by
the Board of Directors;

IV – approve the employment
guidelines of the Company, according to the general policy approved by the
Board of Directors;

V – acquire, dispose and encumber
the fixed assets (bens do ativo permanente), after
the prior approval of the Board of Directors, establishing rules and delegating
powers, complying with the provisions of Article 24 of these Bylaws;

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VI – authorize the acquisition,
disposal and transaction with real estate, except for securities, establishing
and delegating powers, complying with the limitations provided hereof;

VII – authorize the execution of
agreements, contracts and conventions which create liens, obligations or
compromises for the Company, being allowed to establish rules and delegate
power, complying with the limitations provided hereof; and

VIII – prepare, in every fiscal year,
the Management Reports, the Financial Statements and the proposal regarding the
destination of Company’s profits to be submitted to the Board of Directors and
to the General Shareholders` Meeting.

Article
26.            Besides the
attributions conferred by these Bylaws, the CEO is competent to:

I – perform the executive
management of the Company, enforcing the resolutions and guidelines set forth
by the General Shareholders’ Meetings and the Board of Directors;

II – have the general and active
charge of the entire business and activities of the Company;

III – execute bonds, mortgages and
others contracts, except when the signing and execution thereof be expressly
delegated by the Board of Directors to some other Officer or agent of the
Company;

IV – call and preside the meeting
of the Board of Directors;

V – keep the Board of Directors
informed about the activities of the Company;

VI – represent the Company before
the courts, personally or by means of another Officer or attorney-in-fact
appointed;

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VII – represent the Company,
personally or by means of other Director or attorney-in-fact, at the General
Shareholder’s Meetings of any company in which the Company has an equity
interest;

VIII – award license to the members
of the Board of Officers and to appoint their substitutes;

IX – suggest, to the Board of
Directors, the areas of practice of each Officer;

X – decide, in case of urgency,
matters related to which the Board of Officers is competent to decide, “ad referendum” of the Board of Officers;

XI – supervise the preparation of
the annual budget of the Company and to present the respective proposal to the
Board of Directors;

XII – supervise the activities of
the areas which are directly subordinated to them;

XIII – publish the annual report of
the Company; and

XIV – exercise the powers and functions
which are specifically designated by the Board of Directors.

Article
27.            The CFO shall
have the following attributions:

I – to have charge and custody of,
and be responsible for, all funds and securities of the Company;

II – to make available at all reasonable
times the Company’s books of account and records to any member of the Board of
Directors upon application during business hours at the office of the Company
where such books and records shall be kept;

III – upon request by the Board of
Directors, render a statement of the condition of the finances of the Company
at any meeting of the Board of Directors or of the Shareholders;

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IV – to establish and maintain an
adequate internal control structure and procedures for financial reporting as
though the Company was required to comply with the Sarbanes-Oxley Act of 2002,
and regulations promulgated thereunder, as such act may be amended or
superseded;

V – to evaluate, upon request by
the Board of Directors, the efficiency of the 
internal control structure and procedures for financial reporting;

VI – to receive, and give receipt
for, moneys due and payable to the Company from any source whatsoever; and

VII – to perform all the duties
incident to the office of CFO and such other duties as from time to time may be
assigned to him or her by the CEO or the Board of Directors.

Article
28.             The Officers are
competent and upon compliance with the provisions of these Bylaws, shall decide
on any investment and/or expenses up to the amount of R$[•], if such
investment or expense, (a) is in accordance with the Company’s corporate
purposes, (b) is not subject to the prior approval by the Board of Directors or
the General Shareholders’ Meeting.

CHAPTER V

FISCAL COMMITTEE

Article
29.             The Fiscal Committee shall be installed by resolution of
the Shareholders, in accordance with the Corporation Law.

Paragraph
1:        The Fiscal Committee, when installed, shall be formed by
three (3) members and the same number of alternates, elected at the General
Shareholders’ Meeting.

 

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Paragraph 2:              The compensation of the members of
the Fiscal Committee shall be established at the General Shareholders’ Meeting
when elected; Compensation may
not be lowered to below the amount set forth in Paragraph 3, Section 162 of the
Corporation Law.

Article 30.                  The Fiscal Committee has the authority to take the actions, provided
for under the Law.

CHAPTER VI

FISCAL YEAR, FINANCIAL STATEMENT AND DISTRIBUTION OF PROFITS 

Article 31.                  The fiscal year ends on
December 31 of each year, and the financial statement will be prepared at
fiscal year end.  The balance sheet will
be prepared semi-annually on June 30 and December 31 of every year.

Article 32.                  Pursuant to the provisions
of Paragraph 2o of Section 152 of the Corporation Law, the Board of Directors
may propose profit sharing to the Officers and/or employees, which payment
shall be expressly stressed in the proposal for the destination of profits
pursuant to Section 192 of the Corporation Law.

Sole Paragraph:        If the shareholders approve the
profit sharing plan, they will establish the respective amount and manner of
distribution amongst the beneficiaries.

Article 33.                  Together with the
financial statement of the fiscal year, the Board of Directors shall present at
the Ordinary Shareholders’ Meeting the proposal regarding the destination of
the remaining net profits of the fiscal year, after the following deductions or
inclusions are considered in the following order:

I –
five percent (5%) to the legal reserve, which will not exceed twenty per cent
(20%) of the corporate capital;

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II –
amount destined to the formation of reserves for liability, and right off the
reserves formed in the prior fiscal years;

 

III –
twenty five percent (25%) for the payment of minimum mandatory dividend to the
Shareholders; and

 

IV –
the remaining, if it exists, will be destined to form the reserve to reinforce
the working capital, which shall not exceed eighty percent (80%) of the
corporate capital, except in case of contrary resolution by the shareholders.

 

Sole Paragraph:        Whenever the amount of the minimum
mandatory dividend exceeds an accrued part of the net profit of the fiscal
year, the Management may propose, and the shareholders may approve, and
designate the excess to the reserve of profits to be accrued.

Article 34.                  The Shareholders have the
right to receive the minimum mandatory dividend of twenty five percent (25%) of
the do net profit of the fiscal year, adjusted in accordance with Article (33),
pursuant to provisions of Section 202 of the Corporation Law.

Article 35.                  The amount paid or
credited, as interest on shareholders’ equity, pursuant to   provisions of Section 9, Paragraph 7o, of
Law nr 9.249, of December 26, 1995, and relevant statutes and regulations, may
be considered for purposes of the mandatory dividend, and such amount shall
compose the dividends to be distributed by the Company for any legal purposes.

Article 36.                  By resolution of the Board
of Directors, it may be declared interim dividends from the profits verified in
the semi-annual balance sheet or in balance sheets corresponding to shorter
periods, or profits cumulated or reserves of profits existing in accordance
with the last annual or semi-annual balance sheets, pursuant to the provisions
of Section 204 of the Corporation Law.

Article 37.                  Except for any contrary
resolution of the General Shareholders’ Meeting or the Board of Directors, the
dividends and interest on 

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shareholders’
equity so declared shall be paid within sixty (60) days after such declaration,
but always within the fiscal year.

Article 38.                  The dividend pursuant to
Article 37 will not be mandatory in the fiscal year in which the management
informs the Ordinary Shareholders’ Meeting that this payment is incompatible
with the financial status of the Company.

Sole Paragraph:        The profits that are not distributed
in accordance with the caput of this
Article shall be registered as special reserve and, if they are not absorbed by
losses in subsequent fiscal years, shall be paid as dividend as soon as the
financial status of the Company so allows.

CHAPTER VII

DISSOLUTION AND LIQUIDATION

Article 39.                  The
Company shall be dissolved and liquidated under the circumstances provided for
by law, and the shareholders shall determine the manner of the liquidation and
the Board of Directors shall appoint a liquidator and establish his
compensation.

Sole Paragraph:        During the liquidation, the Fiscal
Committee will not work permanently, but will only be installed by request of
the Shareholders, according to the law.

CHAPTER VIII

MISCELLANEOUS

Article 40.                  The
Company shall observe the shareholders’ agreements filed in its head offices,
considering that (i) they shall be referred to in the book 

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of
registration of nominative shares; and (ii) the chairman of the Meeting of the
Board of Directors or the cordinator of the Shareholders’ Meeting, as the case
may be, shall refuse to count a vote that is not in accordance with the
provisions of the shareholders` agreement.

Article 41.                  In case of recess, the value
of the reimbursement related to the shares
 of the dissenting Shareholders will be
determined according to the Company’s economic value, pursuant to Section 45 of
the Corporation Law.

Article 42.                  In case any disputes arise
between Shareholders and the Company, or between the controlling shareholders
and the minority shareholders, and they fail to reach a solution, the conflict
shall be solved by means of arbitration, in São Paulo, Brazil, pursuant to the
arbitration rules of the International Chamber of Commerce (“Câmara Internacional de Comérci — ICC”).

Sole Paragraph:        To enforce the arbitration award (laudo arbitral) and to solve the conflicts which were not
submitted to arbitration, the parties elect the courts of the City of São
Paulo, State of São Paulo, with the express waiver of any other courts, no
matter how privileged they may be.

Article 43.                  The amounts expressed in Reais (R$) in these Bylaws shall be djusted annually, every
[·],
according to the [·] variation.

 

 20Exhibit
10.3

Exhibit
B

TRADEMARK
CROSS-LICENSE AGREEMENT

 

 

BETWEEN

 

 

LONE STAR STEEL
COMPANY, L.P.

 

 

AND

 

 

APOLO MECÂNICA E
ESTRUTURAS S.A.

 

 

DATED AS OF [·]

 

TRADEMARK CROSS-LICENSE AGREEMENT 

BETWEEN 

LONE STAR STEEL COMPANY, L.P. AND APOLO MECÂNICA E ESTRUTURAS S.A.

This Trademark Cross-License Agreement (this “Agreement”) is
entered into effective [•], 2006 by and between:

I.                                         ON
THE ONE SIDE:

(a)                                  LONE
STAR STEEL COMPANY, L.P., a Delaware limited partnership, organized under
the laws of the State of Delaware in the United States of America, with offices
at 5660 N. Dallas Parkway, Suite 500, Dallas, TX 75248, herein represented by
its undersigned legal representatives as they solely declare, hereinafter
referred to as “LSS”; and

II.                                     ON
THE OTHER SIDE:

(b)                                 APOLO MECÂNICA E ESTRUTURAS S.A., a corporation (sociedade anônima /
stock corporation), organized under the laws of the Federative Republic of
Brazil, with offices at in the city of Lorena, State of São Paulo, at
Av. Dr. Léo de Affonseca Netto, 750, CEP 12600-000, herein represented by its undersigned legal
representatives as they solely declare, hereinafter referred to as the “Company”.

LSS and the
Company hereinafter jointly referred to as “PARTIES”, and each of them,
individually and indistinctly referred to as a “PARTY”.

WITNESSETH:

WHEREAS:

I.                                         Apolo Tubos e Equipamentos S.A. (“Tubos”), a corporation (sociedade anônima / stock corporation), duly
organized and existing under the laws of the Federative Republic of Brazil, Lone
Star Brazil Holdings 2 Ltda., a limited liability company (sociedade empresária
limitada) organized under the laws of the Federative

 2
 

 

Republic of
Brazil (“LSB 2”), the Company, Lone Star Technologies, Inc., a Delaware
corporation, GPC Participacoes S.A., a corporation (sociedade anônima / stock
corporation), organized under the laws of the Federative Republic of Brazil, and
Cirrus Participacoes Ltda., a limited liability company (sociedade empresária
limitada) organized under the laws of the Federative Republic of Brazil are
entering into that certain Contribution Agreement (the “Contribution
Agreement”), pursuant to which LSB 2 will acquire 50% of the common shares
of the Company in accordance with the provisions of the Contribution Agreement,
to carry out the development, construction, operation and management of a plant
for processing of carbon steel and alloy tubing and the operation and
management of other related business activities, and the Company and LSS are
entering into a Sales, Marketing and Supply Agreement (together with the
Contribution Agreement the “JV Agreements”);

II.                                     LSS intends to purchase products
from the Company and the Company intends to supply such products under a
separate agreement or agreements. In connection with the supply of such
products, LSS desires to license the Company to use certain trademarks listed on Schedule
A to this Agreement (the “LSS Marks”), pursuant to the terms and
conditions set forth under this Agreement; and

III.                                 The Company intends to purchase
products from LSS and LSS intends to supply such products under a separate
agreement or agreements. In connection with the supply of such products, the
Company desires to sublicense LSS to use certain trademarks listed on Schedule
B to this Agreement (the “Company Marks”), pursuant to the terms and
conditions set forth under this Agreement.

Now, therefore, in consideration
of the representations, warranties, and covenants herein contained, the PARTIES
agree to enter into this Agreement, which shall be governed by the following
clauses and conditions:

SECTION I.                                  DEFINITIONS
AND INTERPRETATION

SECTION 1.                           DEFINITIONS

1.1.                              The following words, expressions,
abbreviations with capital letters, not defined in other sections of this
Agreement, shall have the meaning ascribed to them in this Section 1.1, except
if otherwise herein expressly indicated or if the context is not compatible
with any significance herein indicated:

 3
 

 

 

	
  Affiliate

  	
   

  	
  of a specified person (the “Specified Person”)
  means any Person a) who, directly or indirectly, controls, is controlled by,
  or is under common control with the Specified Person, b) who, directly or
  indirectly, owns or controls fifty percent (50%) or more of the Specified
  Person’s outstanding voting securities or equity interests, c) of whom the
  Specified Person, directly or indirectly, owns or controls fifty percent
  (50%) or more of the outstanding voting securities or equity interests or d)
  who has the right, directly or indirectly, to appoint or elect fifty percent
  (50%) or more of the Specified Person’s board of directors or equivalent
  managing body.

  
	
   

  	
   

  	
   

  
	
  Agreement

  	
   

  	
  means this Trademark Cross-License Agreement.

  
	
   

  	
   

  	
   

  
	
  Company

  	
   

  	
  has the meaning set forth in the Preamble of this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  Company Marks

  	
   

  	
  has the meaning set forth in Recital III to this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  Conflict

  	
   

  	
  has the meaning set forth in Section 24.1 of this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  Contribution
  Agreement

  	
   

  	
  has the meaning set forth in Recital I to this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  Effective Date

  	
   

  	
  has the meaning set forth in Section 11.1 of this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  Governmental
  Authority

  	
   

  	
  means any Brazilian or foreign federal, state,
  municipal, similar government, governmental or non- or quasi-governmental
  regulatory or administrative authority, political subdivision, agency or
  commission or any court, tribunal, judicial or arbitration body, or any other
  Person authorized to act on behalf of any of the foregoing, with jurisdiction
  in relation to the subject, Person or asset in question.

  
	
   

  	
   

  	
   

  
	
  ICC Rules

  	
   

  	
  has the meaning set forth in Section 24 hereof.

  
	
   

  	
   

  	
   

  
	
  INPI

  	
   

  	
  has the meaning set forth in Section 13.3 of this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  JV Agreements

  	
   

  	
  has the meaning set forth in Recital I to this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  Law

  	
   

  	
  means any statute, law, treaty, ordinance, rule,
  regulation, instrument, directive, decree, permit, agreement, Order or

  

 

 4
 

 

 

	
  

  	
   

  	
  injunction of or with any Government Authority, and
  includes, without limitation, rules or regulations of any regulatory or
  self-regulatory authority compliance with which is required by law.

  
	
   

  	
   

  	
   

  
	
  LIENS

  	
   

  	
  means any lien, mortgage, pledge, guaranty,
  encumbrance, option, right of first refusal and/or any other claim or right
  of any nature.

  
	
   

  	
   

  	
   

  
	
  LSB 2

  	
   

  	
  has the meaning set forth in Recital II to this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  LSS

  	
   

  	
  has the meaning set forth in the Preamble of this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  LSS Marks

  	
   

  	
  has the meaning set forth in Recital II to this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  Marks

  	
   

  	
  means LSS Marks as set forth in Recital II to this
  Agreement and Company Marks as set forth in Recital III to this Agreement.

  
	
   

  	
   

  	
   

  
	
  Notice of
  Conflict

  	
   

  	
  has the meaning set forth in Section 24.1 of this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  Party/Parties

  	
   

  	
  has the meaning set forth in the Preamble of this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  Person

  	
   

  	
  means any natural person, partnership, joint
  venture, limited liability company, corporation, or any other entity or
  organization.

  
	
   

  	
   

  	
   

  
	
  Term

  	
   

  	
  has the meaning set forth in Section 11.1 of this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  Tubos

  	
   

  	
  has the meaning set forth in Recital I to this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  Tubular Products

  	
   

  	
  has the meaning ascribed to such term in the
  Contribution Agreement.

  

 

SECTION 2.                           INTERPRETATION

2.1.                              In this Agreement and in its respective schedules,
except when specifically otherwise provided:

 5
 

 

(i)                                     the table of contents and article and section headings are for
convenience only and shall not affect the interpretation of this Agreement;

(ii)                                  references to any document, instrument or agreement, including this
Agreement shall include (a) all schedules to this Agreement; and (b) all
documents, instruments or agreements issued or executed in replacement hereof
or thereof, if existing;

(iii)                               references to a document or agreement, including this Agreement,
shall be deemed to include any amendment, restatement, modification or
supplement thereto entered into in accordance with the terms thereof;

(iv)                              the words “include”, “includes” and “including” are not limiting;

(v)                                 references to any Person shall include such Person’s successors and
permitted assigns, heirs and representatives;

(vi)                              the words “hereof”, “herein”, “hereunder” and words of similar
import shall refer to this Agreement as a whole and not to any particular
provision of this Agreement;

(vii)                           references to “days” shall mean calendar days;

(viii)                        the singular includes the plural and the plural includes the
singular;

(ix)                                references to any laws, generally, shall means laws in effect on the
date of execution of this Agreement, and references to any specific law shall
mean such specific law in effect on the date of execution of this Agreement;
and

(x)                                   any reference to an article, section, clause or exhibit is to the
article, section, clause of, or to a schedule or exhibit to this Agreement
unless otherwise indicated.

 6
 

 

SECTION II.                              TRADEMARK
LICENSE

SECTION 3.                           GRANT
OF LICENSES

3.1.                              LSS
grants to the Company a nonexclusive, nontransferable, revocable, limited,
royalty free license during the Term to use the LSS Marks in connection with
Tubular Products and the sale of goods and services covered by the
registrations referred to in Schedule A to this Agreement anywhere in
the world, provided that such use is limited to Tubular Products
manufactured at the locations in Brazil where the Company operates steel fabrication and/or
Tubular Products finishing facilities that are identified in the JV Agreements
or as otherwise mutually agreed.  The
license granted under this Section 3.1 is subject to the terms and conditions
of the JV Agreements. The Company has
no right to permit or sublicense any third party to use the LSS Marks,
including, without limitation, by way of sub-license, and/or assignment or
otherwise, unless with the prior written approval of LSS. All rights not
expressly granted herein are reserved by LSS.

3.2.                              Within
30 days of the Effective Date, LSS will file applications for the registration
of the LSS Marks in Brazil.  Any such
application filed pursuant to this Section 3.2 and any trademark registration
issuing therefrom shall be considered LSS Marks, as such term is defined in
this Agreement.

3.3.                              The
Company grants to LSS a nonexclusive, nontransferable, revocable, limited,
royalty free sublicense during the Term to use the Company Marks in connection
with Tubular Products purchased by the Company from LSS and the sale of goods
and services covered by the registrations referred to in Schedule B to
this Agreement at the locations in the United States, provided that such
use is limited to only Tubular Goods purchased by the Company in accordance
with the JV Agreements or as otherwise mutually agreed. The sublicense granted
under this Section 3.3 is subject to the terms and conditions of the JV
Agreements. LSS has no right to
permit or license any third party to use the Company Marks, including, without
limitation, by way of sub-license, and/or assignment or otherwise, unless the
prior written approval of the Company is obtained. All rights not expressly
granted herein are reserved by the Company.

3.4.                              Within
30 days of the Effective Date, the Company will file applications for the
registration of the Company Marks in the United States.  Any such application filed pursuant to this
Section 3.4 and any trademark registration issuing

 7
 

 

therefrom shall be considered Company Marks, as such
term is defined in this Agreement.

3.5.                              From
time to time each Party may develop or acquire one or more trademarks and
service marks for use with Tubular Products manufactured or services provided
in acccordance with the JV Agreements. Any such trademarks shall be considered
the Marks for the purposes of this Agreement, and each Party expressly agrees
to grant the other Party a license to use such trademarks and/or service marks
when requested. The terms and conditions associated with such license shall be
the same as contained in this Agreement unless the Parties mutually agree
otherwise.

SECTION 4.                           OWNERSHIP
OF MARKS

4.1                                 The
Company acknowledges the ownership and/or right to use the LSS Marks by LSS.
The Company agrees that it will do nothing inconsistent with such ownership of LSS.
For example, neither the Company nor any company associated with the Company
will file any application for registration of a trademark or service mark that
is the same as or similar to the LSS Marks in English, Portuguese or any other
language in any country. The Company agrees that all use of the LSS Marks by
the Company shall inure to the benefit of and be on behalf of LSS and agrees to
assist LSS in recording this Agreement with appropriate government authorities.
The Company agrees that nothing in this Agreement shall give the Company any
right, title or interest in the LSS Marks other than the right to use the LSS
Marks in accordance with the terms herein. The Company agrees that it will not
attack the title of LSS to the LSS Marks or attack the validity of the license
granted herein. The Company further agrees to support LSS’s efforts to register
and maintain the LSS Marks in Brazil and any other country, provided that the
Company is under no obligation to register or maintain the LSS Marks in any
such country on behalf of LSS. The Company agrees to assign any and all rights
which the Company may obtain in the LSS Marks to LSS.  In the event that the Company incurs any
expenses related to the registration or maintenance of the LSS Marks, LSS
agrees to timely reimburse the Company for any such expenses.

4.2.                              LSS
acknowledges the right to use the Company Marks by the Company. LSS agrees that
it will do nothing inconsistent with such right to use of the Company. For
example, neither LSS nor any company associated with LSS will file any
application for registration of a trademark or service mark that is the same as
or similar to the Company Marks in English, Portuguese or any other language in
any country. LSS agrees that all use of the Company Marks by LSS shall inure to
the benefit

 8
 

 

of and be on behalf of the Company and agrees to
assist the Company in recording this Agreement with appropriate government
authorities. LSS agrees that nothing in this Agreement shall give LSS any
right, title or interest in the Company Marks other than the right to use the
Company Marks in accordance with the terms herein. LSS agrees that it will not
attack the title of the Company to the Company Marks or attack the validity of
the license granted herein. LSS further agrees to support the Company’s efforts
to register and maintain the Company Marks in the USA and any other country,
provided that LSS is under no obligation to register or maintain the Company
Marks in any such country on behalf of the Company.  LSS agrees to assign any and all rights which LSS
may obtain in the Company Marks to the Company. 
In the event that LSS incurs any expenses related to the registration or
maintenance of the Company Marks, the Company agrees to timely reimburse LSS
for any such expenses.

SECTION 5.                           QUALITY
STANDARDS

5.1.                              The
Company agrees that the nature and quality of all services rendered by the
Company in connection with the LSS Marks; all goods sold by the Company under
the LSS Marks; and all related advertising, promotional and other related uses
of the LSS Marks by the Company shall conform to or exceed corresponding
quality standards set by LSS.

5.2.                              LSS
agrees that the nature and quality of all services rendered by LSS in
connection with the Company Marks; all goods sold by LSS under the Company
Marks; and all related advertising, promotional and other related uses of the
Company Marks by LSS shall conform to or exceed corresponding quality standards
set by the Company.

SECTION 6.                           QUALITY
MAINTENANCE

6.1.                              The
Company agrees to cooperate with LSS in facilitating LSS appropriately
monitoring the quality standards used by the Company, to permit reasonable
inspection of the Company’s operation, and to supply LSS with specimens of all
uses of the LSS Marks upon request. The Company shall comply with all
applicable laws and regulations and obtain all appropriate government approvals
pertaining to the sale, distribution and advertising of goods and services
covered by the license granted herein. The Company agrees that the quality of
any products sold with the LSS Marks shall be at least as good as the quality
of the goods and services marketed by LSS and shall conform to any quality
standards identified by LSS from time to time.

 9
 

 

6.2.                              LSS
agrees to cooperate with the Company in facilitating the Company’s
appropriately monitoring the quality standards used by LSS, to permit
reasonable inspection of LSS’s operation, and to supply the Company with
specimens of all uses of the Company Marks upon request. LSS shall comply with
all applicable laws and regulations and obtain all appropriate government
approvals pertaining to the sale, distribution and advertising of goods and
services covered by the license granted herein. LSS agrees that the quality of
any products sold with the Company Marks shall be at least as good as the
quality of the goods and services marketed by the Company and shall conform to
any quality standards identified by the Company from time to time.

SECTION 7.                           FORM
OF USE

7.1.                              The
Company agrees to use the LSS Marks only in the form and manner and with
appropriate legends as are prescribed from time to time by LSS, and not to use
any other trademark or service mark in combination with any of the LSS Marks
without prior written approval of LSS.

7.2.                              LSS
agrees to use the Company Marks only in the form and manner and with
appropriate legends as are prescribed from time to time by the Company, and not
to use any other trademark or service mark in combination with any of the
Company Marks without prior written approval of the Company.

SECTION 8.                           INFRINGEMENT
PROCEEDINGS

8.1.                              The
Company agrees to promptly notify LSS of any unauthorized use of the LSS Marks by
others as it comes to the Company’s attention. LSS shall have the sole right
and discretion to bring infringement or unfair competition proceedings
involving the LSS Marks. As may be requested by LSS from time to time, the
Company agrees to assist LSS in any unfair competition or infringement
proceedings in the Federative Republic of Brazil.

8.2.                              LSS
agrees to promptly notify the Company of any unauthorized use of the Company
Marks by others as it comes to LSS’s attention. The Company shall have the sole
right and discretion to bring infringement or unfair competition proceedings
involving the Company Marks. As may be requested by the Company from time to
time, LSS agrees to assist the Company in any unfair competition or
infringement proceedings in the United States of America.

 10
 

 

SECTION 9.                           REPRESENTATIONS
AND WARRANTIES OF LSS

9.1.                              LSS grants to the
Company the following representations and warranties:

9.1.1.                     Ownership.  LSS
is the sole owner of or has the right to use and sublicense the LSS Marks.  The LSS Marks are free of any LIENS and are registered for the term of
validity indicated in their respective registration certificates. Nothing in
this Agreement shall be deemed as an obligation of LSS to renew the
registration of any of the LSS Marks, which will only be renewed at LSS’s sole
and exclusive discretion, and LSS shall not be liable to the Company for any
expense, cost, or loss associated with LSS’s exercise of such discretion.

9.1.2.                     Organization.  LSS
is a limited partnership organized under the laws of the state of Delaware, of
the United States of America, with offices at 15660 N. Dallas Parkway, Suite
500, Dallas, TX 75248;

9.1.3.                     Authorization.  LSS
has the full power and necessary authority to execute and deliver this
Agreement and to perform the obligations contained in this Agreement. LSS has
the full capacity and does not depend on any additional authorization to
execute this Agreement.

9.1.4.                     Valid and Enforceable Agreement.  This
Agreement was executed by LSS and is a valid and enforceable obligation of LSS.

9.1.5.                     No
Conflict; Consents.  The execution and delivery of this Agreement
by LSS and the completion of the operations described herein do not:

(i)                                     breach or
conflict with any organizational or corporate document of LSS, or with any corporate
resolution of its respective shareholders or quotaholders, or any agreement,
contract, commitment, obligation, understanding, arrangement or restriction of
any kind to which LSS is a party or is subject to, or by which its respective
assets or properties are bound;

(ii)                                  to the actual
knowledge of LSS, breach or conflict with any law, decision or sentence issued
by any Governmental Authority, applicable to LSS or to its respective assets or
properties; and

 11

 

(iii)                               to the actual
knowledge of LSS, require any consent, approval or authorization of, any Person
or any Governmental Authority or any registration before them.

Section 10.                    Representations and Warranties of the Company

10.1.                        The Company
grants to LSS the following representations and warranties:

10.1.1.                 Ownership.  The
Company is the sole owner of or has the right to use and sublicense the Company
Marks.  The Company Marks are free of any LIENS and are registered for the term of
validity indicated in their respective registration certificates. Nothing in
this Agreement shall be deemed as an obligation of the Company to renew the
registration of any of the Company Marks, which will only be renewed at Company’s
sole and exclusive discretion, and the Company shall not be liable to LSS for
any expense, cost, or loss associated with the Company’s exercise of such
discretion.

10.1.2.               Organization.  The
Company is a corporation (sociedade anônima / stock corporation), duly
incorporated, validly existing and in good standing under the laws of the
Federative Republic of Brazil.

10.1.3.               Authorization.  The
Company has the full power and necessary authority to execute and deliver this
Agreement and to perform the obligations contained in this Agreement. The
Company has the full capacity and does not depend on any additional
authorization to execute this Agreement.

10.1.4.               Valid and Enforceable Agreement.  This
Agreement was executed by the Company and is a valid and enforceable obligation
of the Company.

10.1.5.               No Conflict;
Consents.  The execution and delivery of this Agreement by the
Company and the completion of the operations described herein do not:

(i)                                     breach or
conflict with any organizational or corporate document of the Company, or with
any corporate resolution of its respective shareholders or quotaholders, or any
agreement, contract, commitment, obligation, understanding, arrangement or
restriction of any kind to which the Company is a party or is subject to, or by
which its respective assets or properties are bound;

 12
 

 

(ii)                                  to the actual
knowledge of the Company, breach or conflict with any law, decision or sentence
issued by any Governmental Authority, applicable to the Company or to its
respective assets or properties; and

(iii)                               to the actual
knowledge of the Company, require any consent, approval or authorization of,
any Person or any Governmental Authority or any registration before them.

Section 11.                    Term

11.1.                        This
Agreement shall be effective when all of the JV Agreements become effective and
all of the conditions identified therein have been fulfilled (the “Effective
Date”) and shall continue for the term of the Shareholders Agreement
between LSB 2, Tubos, and the Company or until the date of expiration of the
registration of the Marks, whichever occurs first (the “Term”) unless
sooner terminated in accordance with Sections 11, 12 and 13.

Section 12.                    Termination for Cause

12.1.                        Either
PARTY may terminate this Agreement and the licenses granted herein if: (i) the
other PARTY breaches any term or condition of this Agreement and fails to cure
such breach within ten (10) days after receipt of written notice of the same;
or (ii) the other PARTY becomes bankrupt, or is the subject of proceedings for
liquidation or dissolution, or ceases to carry on business or becomes unable to
pay its debts as they come due or upon the winding-up sale, consolidation,
merger or any sequestration by governmental authority of the other PARTY. In
addition, this Agreement shall terminate if the aggregate of LSS’s ownership of
the Company and LSS directors’ ownership of the Company becomes less than forty
five percent (45%) of the outstanding capital of the Company.

Section 13.                    Effect of Termination

13.1.                        Upon
termination of this Agreement, the Company agrees to immediately discontinue all
use of the LSS Marks and any term confusingly similar thereto, and to delete
the same from its corporate or business name, to cooperate with LSS or its
appointed agent to apply to the appropriate authorities to cancel recording of

 13
 

 

the Agreement from all
government records, to destroy all printed materials bearing any of the LSS
Marks, and that all rights in the LSS Marks and the goodwill connected
therewith, whether existing on the date hereof or created thereafter by any
means, shall remain the property of LSS.

13.2.                        Upon
termination of this Agreement, LSS agrees to immediately discontinue all use of
the Company Marks and any term confusingly similar thereto, and to delete the
same from its corporate or business name, to cooperate with the Company or its
appointed agent to apply to the appropriate authorities to cancel recording of
the Agreement from all government records, to destroy all printed materials
bearing any of the Company Marks, and that all rights in the Company Marks and
the goodwill connected therewith, whether existing on the date hereof or
created thereafter by any means, shall remain the property of the Company.

13.3.                        Upon
termination of this Agreement the PARTIES shall provide for the cancellation of the
registration of this Agreement at the National Institute of Industrial Property
(“INPI”), and/or at any other authority with which this Agreement may
have been so recorded and/or registered.

Section 14.                    Indemnification

14.1.                        The
Company shall defend, indemnify
and hold harmless LSS, its affiliates (other than the Company), and their
officers, employees, directors and agents (including paying reasonable
attorneys’ fees, costs, expenses and disbursements) from and against: (a) any
third party claim based on breach of warranty, strict liability, or products
liability associated with any products manufactured by the Company under the LSS Marks; or (b) any
claim under this Agreement against LSS by an Affiliate of the Company.

14.2.                        LSS shall defend, indemnify and hold
harmless the Company, its affiliates (other than LSS), and their officers,
employees, directors and agents (including paying reasonable attorneys’ fees,
costs, expenses and disbursements) from and against: (a) any third party claim
based on breach of warranty, strict liability, or products liability associated
with any products manufactured by LSS under
the Company Marks; or (b) any claim under this Agreement against the Company by
an Affiliate of LSS.

 14
 

 

CHAPTER IV.                     FURTHER
COVENANTS OF THE PARTIES

Section 15.                    Injunction Relief

15.1.                        Each PARTY
acknowledges that any breach of the respective PARTY’s obligations under this
Agreement concerning use of the Marks or ownership of the Marks may cause the
other PARTY irreparable harm not compensable with money damages, and that in
the event of such breach, the other PARTY shall be entitled to seek injunctive
relief, without bond, from any court of competent jurisdiction.

Section 16.                    Assignment

16.1.                        Neither
PARTY shall assign or transfer its rights, duties or obligations under this
Agreement, whether by contract, operation of law, merger, reorganization,
liquidation, dissolution or sale of assets, without the prior written consent
of the other PARTY. Any purported assignment or transfer of this Agreement
without the prior written consent of the other PARTY shall be null and void.

Section 17.                    Notices

17.1.                        Unless
otherwise provided in this Agreement, notices or other communications required
to be given by any PARTY pursuant to this Agreement may be delivered
personally, sent by registered airmail (postage prepaid), sent by a recognized
air courier service, sent by facsimile transmission, or sent by e-mail
transmission to the address of the other PARTY set forth below or such other
address notified in lieu thereof. The dates on which notices shall be deemed to
have been effectively given shall be determined as follows:

(a)                                  Notices given by
personal delivery shall be deemed effectively given on the date of personal
delivery.

(b)                                 Notices given by
registered airmail (postage prepaid)
shall be deemed effectively given on the seventh (7th) day after the date on
which they were mailed (as indicated by the postmark).

(c)                                  Notices given by air
courier shall be deemed effectively given on the date of delivery (as indicated
by the airway bill).

 15
 

 

(d)                                 Notices given by
facsimile or e-mail transmission shall be deemed effectively given on the first
(1st) business day following the date of transmission.

For the purpose of
notice, the addresses of the PARTIES are as follows:

If to
the Company:

Apolo Mecânica e Estruturas S.A.

Av. Dr. Leo de Affonseca Neto, 750 Mondesire –

12600-970 – Lorena/SP

Telefax:
(55 12) 3153-2290

With a copy to
(which shall not constitute notice for the purposes herein):

Apolo Tubos e
Equipamentos S.A.

Av. Chrisóstomo Pimentel
de Oliveira, no 2.651, Pavuna

CEP 21650-000 Rio de
Janeiro, RJ

Brasil

Telefax:  (21)
3452-9139

If to LSS:

Lone Star Technologies, Inc.

15660 N. Dallas Pkwy., Suite 500

Dallas, TX 75248

United States of America

Telefax: 
972-770-6474

Attn:  General Counsel

With a copy to
(which shall not constitute notice for the purposes herein):

Mary R. Korby

Weil, Gotshal &
Manges, LLP

200 Crescent Court, Suite
300

Dallas, Texas  75201

Telefax: 
214-746-7777

With a copy to
(which shall not constitute notice for the purposes herein):

Marcos Flesch

Souza, Cescon Avedissian,
Barrieu e Flesch - Advogados

Rua Funchal, 263 11°
andar

04551-060 São Paulo, SP

Telefax: (55 11) 3089 6565

 16
 

 

or to such other person,
address or telefax number as any party may specify by notice in writing to the
other.  All such notices, shall be deemed
to have been received (i) if by personal delivery on the day after such
delivery, (ii) if by courier services or overnight mail or delivery, on the day
delivered, and (iii) if by facsimile on the next day following the day on which
such facsimile was sent, provided that it is followed immediately by a
confirmation by personal delivery or overnight mail that is received pursuant
to subclause (i) or (ii) provided that if the date of receipt is not a Business
Day at the place of the principal office of the party receiving the notice, or
if the receipt is after 5:00 p.m. on a Business Day, the notice or other
communication shall be deemed given, received, and effective on the next
Business Day at the place of the principal office of the addressee.

17.1.1.               Changes.  Any PARTY may by notice given in accordance with Section
17.1 designate another address or Person for the receipt of the notices
hereunder.

SECTION 18.                    THIRD PARTY
BENEFICIARIES

18.1.                        Except as
expressly provided herein, this Agreement is entered into solely between, and
may be enforced only by the Company and
LSS. This Agreement shall not be deemed to create any rights or causes of
action in or on behalf of any third PARTIES, including without limitation,
employees, suppliers and customers of a PARTY, or to create any obligations of
a PARTY to any such third PARTIES.

Section 19.                    Severability

19.1.                        If any
provision of this Agreement is held invalid or otherwise unenforceable, the
enforceability of the remaining provisions shall not be impaired thereby and
the illegal provision will be replaced with a legal provision that encapsulates
to the extent permitted by applicable law the original intent of the PARTIES.

Section 20.                    Headings

20.1.                        The
headings contained in this Agreement are for reference only and shall not be
deemed to be a part of this Agreement or to affect the meaning or
interpretation hereof.

 17
 

 

SECTION 21.                    COMPLIANCE
WITH LAWS

21.1.                        Each PARTY
agrees to comply with all applicable laws including, but not limited to, U.S.
Foreign Corrupt Practices Act and U.S. export control laws and
regulations.  No PARTY shall export or
re-export any item or any direct product thereof or undertake any transaction
or service in violation of any such laws and regulations.

Section 22.                    Independent Contractor

22.1.                        The
relationship of the PARTIES under this Agreement shall not constitute a
partnership or joint venture. The relationship of the PARTIES shall be
determined solely by the JV Agreements. Neither PARTY is an agent of the other
PARTY and neither PARTY has right, power or authority, expressly or impliedly,
to represent or bind the other PARTY.

Section 23.                    Binding Effect

23.1.                        This Agreement is binding
between the PARTIES and shall inure to the benefit of the PARTIES and their
respective successors and authorized assignees.

Section 24.                    Dispute Resolution; Governing Law and
Jurisdiction

24.1.                        The parties shall make every
effort to settle amicably any and all disputes, controversies and conflicts
arising out of or relating to or in connection with this Agreement, the
performance or non-performance of the obligations set forth herein (including
any questions regarding its existence, validity or termination) (a “Dispute”).  Except as provided in this Section 24.1, Disputes or claims, if any, which
cannot be settled amicably between the parties, within thirty (30) days after
written notice of such Dispute has been given by one party to the other party,
shall be referred to and finally resolved by arbitration in Sao Paulo, Brazil
under the Rules of Arbitration of the International Chamber of Commerce (“ICC
Rules”) for the time being in force. 
The ICC Rules shall be deemed to be incorporated by reference into this Section 24.1.  The tribunal shall consist of three (3)
arbitrators.  Each of “the Company” and
LST shall appoint one (1) arbitrator and the arbitrators appointed by “the
Company” and LST shall appoint the third (3rd) arbitrator.  The
costs of the arbitration, including administrative and arbitrator’s fees, shall
be shared equally by the parties.  Each
party shall bear the costs of its own attorney’s fees and expert witness
fees.  The arbitration proceedings shall
be in English and Portuguese and all pleadings and written evidence shall be in

 18
 

 

English and Portuguese.  The
parties agree that the arbitration shall be kept confidential and that the
existence of the proceeding and any element of it (including but not limited to
any pleadings, briefs or other documents submitted or exchanged, any testimony
or other oral submissions, and any awards) shall not be disclosed beyond the
tribunal, the ICC, the parties, their counsel and any person necessary to the
conduct of the proceeding, except as may be lawfully required in judicial
proceedings relating to the arbitration or otherwise, or as required by
applicable Law.  The decision of the
tribunal shall be final, binding and enforceable upon the parties and judgment
upon any award rendered by the tribunal may be entered in any court having
jurisdiction thereof.  In the event that
the failure of a party to this Agreement to comply with the decision of the
tribunal requires the other party to apply to any court for enforcement of such
award, the non-complying party shall be liable to the other for all costs of
such litigation including attorneys’ fees. 
The parties may apply to any court of competent jurisdiction in
accordance with this Section 24.1 for temporary or permanent injunctive
or preliminary relief, without breach of this Section 24. or abridgement
of the powers of the tribunal.  For the purposes
of obtaining temporary or permanent injunctive or preliminary relief and
without abridgement of the powers of the tribunal, the parties elect the courts
of the City of Sao Paulo, State of Sao Paulo, with the express waiver of any
other courts, no matter how privileged they may be.  Except for applications regarding preliminary
or injunctive relief, neither party shall be entitled to commence or maintain
any action in any court of law upon any matter in dispute until such matter
shall have been submitted to, and finally determined under, the dispute
resolution and arbitration procedures in this Section 24.  Process may be served on either party in the
manner set forth in this Agreement or by such other method authorized by
applicable Law or court rule.

24.2.                        This Agreement shall be
construed according to and governed by the laws of the Federative Republic of
Brazil.

Section 25.                    Amendment

25.1.                        Amendments
to this Agreement and the other contracts contemplated herein may be made only
by a written agreement in English and Portuguese signed by duly authorized
representatives of each of the PARTIES.

Section 26.                    Language

26.1.                        This
Agreement is written and executed in Portuguese and English and the two
versions shall have equal validity. In the event of any inconsistency between
the two versions, the English version should prevail.

 19
 

 

Section 27.                    Publicity

27.1.                        Neither
PARTY shall use the other PARTY’s name or Marks or refer to the other PARTY
directly or indirectly in any media release, public announcement, or public
disclosure relating to this Agreement, including in any promotional or
marketing materials, customer lists or business presentations without the prior
written consent of the other PARTY prior to each such use or release.  Neither PARTY shall make any public
statements about this Agreement or its relationship with the other PARTY
without the other PARTY’s prior written 
approval, except as required by law.

Section 28.                    Waiver

28.1.                        Unless
otherwise provided for, failure or delay on the part of any PARTY to exercise
any right or privilege under this Agreement shall not operate as a waiver of
such right or privilege nor shall any partial exercise of any right or
privilege preclude any further exercise thereof. Any waiver by a PARTY of a
breach of any term or provision of this Agreement shall not be construed as a
waiver by such PARTY of any subsequent breach, its rights under such term or
provision, or any of its other rights hereunder.

Section 29.                    Counterparts

29.1.                        This Agreement may be executed
in any number of counterparts, each of which shall be an original, and such
counterparts together shall constitute one and the same instrument. Execution
may be effected by delivery of facsimiles of signature pages, which shall be
deemed originals in all respects.

Section 30.                    Registration of the Agreement

30.1.                        This Agreement shall be submitted by the Company to the INPI for
registration within thirty (30) days of the date of its execution. Any costs,
fees and/or expenses related to or necessary for the accomplishment of such
registrations shall be borne by the Company.

30.1.1.               The PARTIES hereby undertake to perform all actions, including the preparation and
execution of any documents necessary or advisable for the registration of this
Agreement with the appropriate authorities.

 20
 

 

SECTION 31.                    SPECIFIC
PERFORMANCE

31.1.                        The
performance of the obligations provided herein may be specifically required by
the nondefaulting PARTY, in accordance with Articles 461, 461 A, 632, and 639
of the Brazilian Civil Procedure Code (“Código de Processo Civil”).

Section 32.                    Entire Agreement

32.1.                        This
Agreement and the JV Agreements contemplated herein constitute the entire
agreement among all PARTIES with respect to the subject matters set forth
herein and supersede all prior discussions, notes, memoranda, negotiations,
understandings and all the documents and agreements between them relating to
the same. All documents, agreements, understandings and correspondence between
the PARTIES with respect to the subject matters set forth herein and prior to
the execution of this Agreement shall, with the exception of any
non-disclosure/confidentiality undertakings, become null and void automatically
when this Agreement enters into effect.

[The remaining
portion of this page intentionally blank.]

 21

 

IN
WITNESS WHEREOF, the parties hereto have duly
executed and delivered this Trademark Cross-License Agreement as of the
Effective Date.

	
   

  	
  LONE STAR STEEL COMPANY, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:   Lone
  Star Steel Company General, LLC, its

  general partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  APOLO MECÂNICA E ESTRUTURAS S.A.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
				

 

 

Schedule A 

to the Trademark Cross-License Agreement 

entered into Between

Lone Star Steel Company, L.P. and
Apolo Mecânica E Estruturas S.A.

LSS Marks

	
  Trademark

  	
   

  	
  Country of Registration

  	
   

  	
  Application No./REG. NO

  	
   

  	
  Owner

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The Tubular Experts

  	
   

  	
  USA

  	
   

  	
  Reg. No. 2552909 03/26/02

  	
   

  	
  Lone Star Steel Company, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The Tubular Experts

  	
   

  	
  USA

  	
   

  	
  Reg. No. 2248090 05/25/99

  	
   

  	
  Lone Star Steel Company, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LSX50

  	
   

  	
  USA

  	
   

  	
  Reg. No. 2578713 6/11/02

  	
   

  	
  Lone Star Steel Company, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LSX40

  	
   

  	
  USA

  	
   

  	
  Reg. No. 2578712 6/11/02

  	
   

  	
  Lone Star Steel Company, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LSX110

  	
   

  	
  USA

  	
   

  	
  Reg. No. 2553933 3/26/02

  	
   

  	
  Lone Star Steel Company, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LSX95

  	
   

  	
  USA

  	
   

  	
  Reg. No. 2553932 3/26/02

  	
   

  	
  Lone Star Steel Company, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LSX80

  	
   

  	
  USA

  	
   

  	
  Reg. No. 2553931 3/26/02

  	
   

  	
  Lone Star Steel Company, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LSS and Design

  	
   

  	
  USA

  	
   

  	
  Reg. No. 1715004 9/15/92

  	
   

  	
  Lone Star Steel Company, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  H2S-100

  	
   

  	
  USA

  	
   

  	
  Reg. No. 1956657 2/13/96

  	
   

  	
  Lone Star Steel Company, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  H2S-95

  	
   

  	
  USA

  	
   

  	
  Reg. No. 1805098 11/16/93

  	
   

  	
  Lone Star Steel Company, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  H2S-90

  	
   

  	
  USA

  	
   

  	
  Reg. No. 1968712 4/16/96

  	
   

  	
  Lone Star Steel Company, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  STARLOY

  	
   

  	
  USA

  	
   

  	
  Reg. No. 0983686 5/14/74

  	
   

  	
  Lone Star Steel Company, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  STARDOM

  	
   

  	
  USA

  	
   

  	
  Reg. No. 0919694 9/7/71

  	
   

  	
  Lone Star Steel Company, L.P.

  

 

 A-1
 

 

 

	
  LONE STAR STEEL COMPANY, L.P.

  	
   

  	
  USA

  	
   

  	
  Reg. No. 0710435 1/31/61

  	
   

  	
  Lone Star Steel Company, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  STARWELD

  	
   

  	
  USA

  	
   

  	
  Reg. no. 0712386 3/14/61

  	
   

  	
  Lone Star Steel Company, L.P.

  

 

 A-2

 

Schedule B

to the Trademark Cross-License Agreement 

entered into between 

Lone Star Steel Company, L.P. and
Apolo Mecânica E Estruturas S.A.

Company Marks

	
  Trademark

  	
   

  	
  Country of Registration

  	
   

  	
  Application No./REG. NO

  	
   

  	
  Owner

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Apolo

  	
   

  	
  Brazil

  	
   

  	
  811089479

  	
   

  	
  Apolo Tubos e Equipamentos S.A.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tubos Apolo

  	
   

  	
  Brazil

  	
   

  	
  816891990

  	
   

  	
  Apolo Tubos e Equipamentos S.A.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Apolo

  	
   

  	
  Brazil

  	
   

  	
  817408894

  	
   

  	
  Apolo Tubos e Equipamentos S.A.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Apolo

  	
   

  	
  Brazil

  	
   

  	
  818038756

  	
   

  	
  Apolo Tubos e Equipamentos S.A.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Apolo

  	
   

  	
  Brazil

  	
   

  	
  825500419

  	
   

  	
  Apolo Tubos e Equipamentos S.A.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Apolo

  	
   

  	
  Brazil

  	
   

  	
  825683203

  	
   

  	
  Apolo Tubos e Equipamentos S.A.

  

 

 B-1

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