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                                                                   EXHIBIT 10.33

                                  AMENDMENT TO
                             THE QUANEX CORPORATION
                          1997 KEY EMPLOYEE STOCK PLAN

         THIS AGREEMENT by Quanex Corporation (the "Company"),

                                  WITNESSETH:

         WHEREAS, the Board of Directors of the Company previously adopted the
plan agreement known as the "Quanex Corporation 1997 Key Employee Stock Plan"
(the "Plan");

         WHEREAS, the Board of Directors of the Company retained the right in
Article XI of the Plan to amend the Plan from time to time; and

         WHEREAS, the Board of Directors of the Company has approved the
following amendment to the Plan;

         NOW, THEREFORE, effective July 1, 2000, the Plan is hereby amended,
effective with respect to both awards of restricted stock outstanding on the
date of the adoption of this amendment and all restricted stock granted under
the Plan in the future, as follows:

         (1)      Section 7.3 is hereby amended and restated in its entirety as
                  follows:

                  7.3 WITHHOLDING OF TAXES. When shares of Restricted Stock
         become vested, the Restricted Stock Award recipient shall (i) pay the
         Company an amount of money necessary to satisfy the Company's tax
         withholding obligations under the Code and applicable state or local
         law arising from the vesting of such Restricted Stock or, (ii) elect to
         receive a reduced number of shares of Common Stock to satisfy the
         Company's tax withholding obligations.

                  At the time a Restricted Stock Award recipient's shares of
         Restricted Stock become vested, the Company shall calculate the amount
         of the Company's tax withholding obligations on the assumption that all
         such vested shares of Restricted Stock are made available for delivery.
         The Restricted Stock Award recipient may pay the Company the amount of
         the Company's tax withholding obligations by cashier's check drawn on a
         national banking association and payable to the order of the Company in
         United States dollars. Such payment, if any, shall be delivered to the
         Company within three days after the date of the lapse of restrictions.
         If the Restricted Stock Award recipient does not timely pay the Company
         an amount necessary to satisfy the

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         Company's withholding obligation, he shall be deemed to have elected to
         have the Company withhold shares of the Restricted stock to satisfy the
         Company's withholding obligation. In the event that a Restricted Stock
         Recipient is deemed to have made such an election, the Company shall
         (i) reduce the number of vested shares of Restricted Stock made
         available for delivery so that the Fair Market Value of the shares
         withheld on the vesting date approximates the amount of tax the Company
         is obliged to withhold and (ii) in lieu of the withheld shares, remit
         cash to the United States Treasury and other applicable governmental
         authorities, on behalf of the Restricted Stock Award recipient, in the
         amount of the withholding tax due.

                  If the Restricted Stock Award recipient is deemed to have
         elected to receive a reduced number of shares of Common Stock to
         satisfy the Company's tax withholding obligations, the Company shall
         withhold only the number of whole shares of Common Stock necessary to
         satisfy its minimum statutory withholding obligation, which shall be
         based on minimum statutory withholding rates for federal and state tax
         purposes, including payroll taxes, that are applicable to the
         Restricted Stock Award recipient's taxable income arising from the
         vesting of his Restricted Stock. If the Fair Market Value of the
         withheld shares does not equal Company's minimum statutory withholding
         amount due, the Company shall withhold whole shares with a Fair Market
         Value slightly less than the minimum statutory withholding amount due.
         The Restricted Stock Award recipient shall pay to the Company the
         remaining balance of the minimum statutory withholding amount due by
         cashier's check drawn on a national banking association and payable to
         the order of the Company in United States dollars.

                  The withheld shares of Restricted Stock not made available for
         delivery by the Company shall be retained as treasury stock or will be
         canceled and, in either case, the recipient's right, title and interest
         in such Restricted Stock shall terminate.

                  All references to the Restricted Stock recipient in this
         Section 7.3 shall be deemed to be references to the estate of the
         Restricted Stock recipient, if applicable.

         (2)      Section 8.2 is hereby amended and restated in its entirety as
                  follows:

                  8.2 CONSEQUENCE OF VESTING. Subject to Article IX, when shares
         of Restricted Stock become vested, the Restricted Period shall be
         terminated as to those shares, and, upon satisfaction of the Company's
         required tax withholding obligation in the manner specified in Section
         7.3, the Company shall deliver to the Restricted Stock Award recipient
         (or his estate, if applicable) a Common Stock certificate representing
         those shares and all Retained Distributions made or declared with
         respect to those shares.<PAGE>   1
                                                                     EXHIBIT 4.1

                               AMENDMENT NO. 1 TO
                                RIGHTS AGREEMENT

         This Amendment No. 1 to Rights Agreement (this "Amendment") is made
effective as of the 22nd day of December 2000. This Amendment is an amendment to
the Rights Agreement, dated as of February 24, 1999 (the "Rights Agreement"),
between Pennaco Energy, Inc., a Nevada corporation, which has been succeeded to
by merger by Pennaco Energy, Inc., a Delaware corporation, and Harris Trust and
Savings Bank, as rights agent ("Harris Trust"), which has been succeeded to by
Computershare Investor Services, L.L.C., as rights agent (the "Rights Agent").

                                    RECITALS

         WHEREAS, Pennaco Energy, Inc., a Nevada corporation ("Pennaco Nevada"),
originally entered into the Rights Agreement with the Rights Agent on February
24, 1999; and

         WHEREAS, on May 16, 2000 Pennaco Nevada merged with and into Pennaco
Energy, Inc., a Delaware corporation (the "Company") and wholly-owned subsidiary
of Pennaco Nevada, for purposes of effecting a reincorporation of Pennaco Nevada
to Delaware (the "Merger"); and

         WHEREAS, in accordance with Section 2.1 of the Agreement and Plan of
Merger between Pennaco Nevada and the Company relating to the Merger, the
Company, as the survivor of the Merger, succeeded to all rights and obligations
of Pennaco Nevada and the Rights were converted into equivalent Rights with
respect to the Company; and

         WHEREAS, effective July 1, 2000, Computershare Investor Services,
L.L.C., a Delaware limited liability company, succeeded to the stock transfer
business of Harris Trust, as a result of which, pursuant to Section 19 of the
Rights Agreement, it became the Rights Agent for purposes of the Rights
Agreement; and

         WHEREAS, the parties wish to amend the Rights Agreement to the extent
necessary to reflect such succession; and

         WHEREAS, the Company proposes to enter into an Agreement and Plan of
Merger (as it may be amended and supplemented from time to time, the "Merger
Agreement") dated as of December 22, 2000 with Marathon Oil Company, an Ohio
corporation ("Marathon"), and Marathon Oil Acquisition 1, Ltd., a Delaware
corporation ("Sub"), under which, among other things, Sub will commence a tender
offer (the "Offer") for all outstanding shares of the Company's Common Stock (as
defined in the Rights Agreement) on the terms set forth in the Merger Agreement;
and

         WHEREAS, Marathon is a wholly owned subsidiary of USX Corporation, a
Delaware corporation; and

         WHEREAS, the Board of Directors of the Company has determined that the
Offer, the merger of Sub with and into the Company (the "Merger") and the other
transactions

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contemplated by the Merger Agreement are fair to and in the best interests of
the Company and its stockholders; and

         WHEREAS, the Board of Directors of the Company has found that it is in
the best interest of the Company and its stockholders, and has deemed it
necessary and desirable, to amend the Rights Agreement pursuant to and in
compliance with Section 27 thereof to exempt the Merger Agreement and the
transactions contemplated thereby, including the Offer and the Merger, from the
application of the Rights Agreement; and

         WHEREAS, pursuant to and in compliance with Section 27 of the Rights
Agreement, the Company and the Rights Agent also wish to amend the Rights
Agreement to correct a provision that may be defective or inconsistent with
other provisions in the Rights Agreement as set forth herein;

         NOW THEREFORE, the parties hereto agree as follows:

         Section 1.   Amendments.

         (a)    Section 1(a) of the Rights Agreement (the definition of
Acquiring Person) is amended by adding to the end thereof the following:

         In addition, notwithstanding the first sentence of this definition,
         none of USX Corporation, a Delaware corporation ("USX"), Marathon Oil
         Company, an Ohio corporation ("Marathon"), Marathon Oil Acquisition 1,
         Ltd., a Delaware corporation ("Sub") or their respective Affiliates and
         Associates, shall be deemed to be an Acquiring Person by reason of any
         beneficial ownership of shares of Common Stock acquired by virtue of
         the execution and delivery of, or pursuant to and in accordance with
         the transactions specifically contemplated by, the Agreement and Plan
         of Merger dated as of December 22, 2000 among the Company, Marathon and
         Sub (as may be amended and supplemented from time to time with the
         approval of the Board of Directors of the Company, the "Merger
         Agreement"), including the acquisition by Sub of shares of Common Stock
         pursuant to the Offer (as defined therein) or the consummation of the
         Merger (as defined therein). Each of the execution, delivery and
         performance by Marathon and Sub of the Merger Agreement, the public
         announcement of the intention of Marathon and Sub to commence the Offer
         in accordance with the Merger Agreement, and the commencement and
         consummation of the Offer in accordance with the Merger Agreement, the
         Merger and the other transactions specifically contemplated by the
         Merger Agreement is referred to herein as an "Exempt Event."

         (b)    Section 1(i) (the definition of Company) is amended to read:
"'Company'means Pennaco Energy, Inc., a Delaware corporation."

         (c)    Section 1(aa) (the definition of Rights Agent) is amended to
read: "'Rights Agent' means Computershare Investors Services, L.L.C., a Delaware
limited liability company."

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         (d)   Section 1(ah) of the Rights Agreement (the definition of Stock
Acquisition Date) is amended to add the following proviso at the end of such
Section: "; provided, however, that no Exempt Event shall cause or result in a
Stock Acquisition Date."

         (e)   Section 3(a) of the Rights Agreement is amended to add at the
end of such Section the following: "Notwithstanding the foregoing, no Exempt
Event shall cause or result in a Distribution Date."

         (f)   Section 7(a) of the Rights Agreement is amended to add to the
end of such Section the following:

         and (iv) the purchase by Sub of shares of Common Stock pursuant to the
         Offer, provided such purchase is effected in compliance with the terms
         of the Merger Agreement.

         (g)   To correct a provision in Section 7(b) of the Rights Agreement
so as to make that Section consistent with the remainder of the Rights
Agreement, the portion of Section 7(b) that reads "The Purchase Price for each
whole share of Common Stock . . ." is amended to read "The Purchase Price for
each one-half share of Common Stock. . . "

         (h)   References in Sections 19 and 21 of the Rights Agreement to the
term "corporation" shall be deemed to include a limited liability company.

         (i)   Section 21 of the Rights Agreement is amended as follows:

               Delete the sentence that begins on page 48 with "Any successor
         Rights Agent . . ." and ends on page 48 with ". . . combined capital
         and surplus of at least $50,000,000." and replace it with:

               Any successor Rights Agent, whether appointed by the Company or
         by such a court, shall be: (a) a corporation, limited liability company
         or trust company (or similar form of entity under the laws of any state
         of the United States or a foreign jurisdiction) authorized to conduct
         business under the laws of the United States or any state of the United
         States, which is authorized under such laws to exercise corporate
         trust, fiduciary or stockholder services powers and is subject to
         supervision or examination by a federal or state authority and which
         has at the time of its appointment as Rights Agent a combined capital
         and surplus of at least $10,000,000; or (b) an Affiliate controlled by
         a corporation, limited liability company or entity described in clause
         (a) of this sentence.

         (j)   Section 26 of the Rights Agreement is amended to replace the
address of the Rights Agent therein with the following:

               Computershare Investor Services, LLC
               Two North LaSalle Street, 3rd Floor
               Chicago, Illinois 60602
               Attention:  Relationship Manager

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         (k)   Section 29 of the Rights Agreement is amended to add at the end
of such Section the following:

         Notwithstanding the foregoing, nothing in this Agreement shall be
         construed to give any registered holder of a Rights Certificate or
         Common Stock or any other Person any legal or equitable right, remedy
         or claim under this Agreement in connection with any transaction
         contemplated by the Merger Agreement.

         (l)   References throughout the Rights Agreement to Harris Trust as the
former Rights Agent shall be deemed to refer to Computershare Investors
Services, L.L.C. as successor Rights Agent.

         Section 2.   Remainder of Agreement Not Affected. Except set forth in
Section 1 hereof, the terms and provisions of the Rights Agreement remain in
full force and effect and are hereby ratified and confirmed.

         Section 3.   Authority. Each party represents that such party has full
power and authority to enter into this Amendment, and that this Amendment
constitutes a legal, valid and binding obligation of such party, enforceable
against such party in accordance with its terms.

         Section 4.   Counterparts. This Amendment may be executed in one or
more counterparts, each of which shall be deemed to be an original, but all of
which shall constitute one and the same agreement.

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         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and attested, all as of the day and year first above written.

Attest:                                   PENNACO ENERGY, INC.

By: /s/ Bryan G. Hassler                  By: /s/ Glen C. Warren, Jr.
    -------------------------------           ------------------------------
Name:  Bryan G. Hassler                   Name:  Glen C. Warren, Jr.
Title: Vice President - Marketing &       Title: CFO & EVP
       Transportation

Attest:                                   HARRIS TRUST AND SAVINGS BANK,
                                          as former Rights Agent

By: /s/ Geraldine Janiec                  By: /s/ Martin J. McHale, Jr.
    -----------------------------------       ---------------------------------
Name:  Geraldine Janiec                   Name:  Martin J. McHale, Jr.
Title: Notary Public                      Title: VP

Attest:                                   COMPUTERSHARE INVESTOR
                                          SERVICES, L.L.C., as Rights Agent

By: /s/ Thomas J. Blatchford              By: /s/ Tod C. Shafer
    ----------------------------------        ----------------------------------
Name:  Thomas J. Blatchford               Name:  Tod C. Shafer
Title: Notary Public                      Title: Client Services Manager

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