Document:

EX-10.1

 

Exhibit 10.1

October 7, 2004

Mr. Thom Golatzki

Vice President Engineering, Energy & Materials

NEWPORT STEEL CORPORATION

530 W. Ninth Street

Newport, KY 41072

Dear Thom:

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

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

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

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

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

	 	 	 
	AGREED TO:

	 	AGREED TO AND ACCEPTED:
	

	 	 
	NEWPORT STEEL CORPORATION

	 	NUCOR CORPORATION
	

	 	 
	By:  /s/ Thomas L. Golatzki

	 	By:  /s/ Timothy W. Hill
	
 

	 	
 
	Its:  Vice President

	 	Its:  Sales Manager
	
 

	 	
 
	Execution Date: October 7, 2004

	 	Acceptance Date: October 8, 2004
	
 

	 	
 

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

 

 

Exhibit A

TERMS AND CONDITIONS OF SALE

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

 

 

Exhibit B

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

	 	 	 	 	 
	

	 	Crawfordsville, IN:
	 	[***]
	

	 	 	 	 
	

	 	Hickman, AR:
	 	[***]
	

	 	 	 	 
	

	 	Decatur, AL:
	 	[***]
	

	 	 	 	 
	

	 	Tuscaloosa, AL:
	 	[***]

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

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

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

 

 

Exhibit C

GRADE EXTRAS: [***]

	 	 	 	 	 	 	 
	NEWPORT

STEEL
	 	Newport

Specification
	 	Current Adder

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

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

	

[***]

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

[***] Indicates portions of this exhibit that have been omitted and separately filed with the Securities and Exchange Commission pursuant to a request for confidential treatment.]EX-10.2

 

EXHIBIT 10.2

NS GROUP, INC. NON-EMPLOYEE DIRECTOR EQUITY PLAN

NONQUALIFIED STOCK OPTION AGREEMENT

     This Agreement (the “Agreement”) is made as of ___, 2___(the “Date of
Grant”) by and between NS Group, Inc., a Kentucky corporation (the “Company”)
and ___(the “Non-Employee Director”).

     1. Grant of Option Right. Subject to and upon the terms, conditions and
restrictions set forth in this Agreement and in the NS Group, Inc. Non-Employee
Director Equity Plan (the “Plan”), the Company hereby grants to the
Non-Employee Director as of the Date of Grant an option (the “Option Right”) to
purchase 4,000 Common Shares, at the price of ___per share (the “Option
Price”). This Option Right is intended to be a nonqualified stock option and
shall not be treated as an “incentive stock option” within the meaning of that
term under Section 422 of the Code.

     2. Exercise of Option Right.

        (a) Unless and until terminated as hereinafter provided, the Option Right
will become exercisable to the extent of one-third of the Common Shares
specified in Section 1 on each of the first three anniversaries of the Date of
Grant for so long as the Non-Employee Director continuously serves on the
Board.

        (b) Notwithstanding the provisions of Section 2(a), the Option Right will
become immediately exercisable in full if, prior to the date the Option Right
becomes fully exercisable pursuant to Section 2(a), and while the Non-Employee
Director serves on the Board, (i) the Non-Employee Director dies, or (ii) a
Change in Control occurs.

        (c) To the extent that the Option Right becomes exercisable in accordance
with this Section 2, it may be exercised in whole or in part from time to time
by written notice to the Company stating the number of Common Shares for which
the Option Right is being exercised and the intended manner of payment.

     3. Forfeiture of Option Right. The Option Right shall be forfeited (to
the extent it has not become exercisable pursuant to Section 2) if the
Non-Employee Director ceases to continuously serve on the Board.

     4. Payment of Option Price. The Option Price is payable (a) in cash or by
certified or cashier’s check or other cash equivalent acceptable to the Company
payable to the order of the Company, (b) with the Board’s approval, by
surrender of Common Shares (including by attestation) owned by the Non-Employee
Director, or (c) by a combination of surrender of Common Shares, and cash or
certified or cashier’s check.

     5. Term of Option Right. The Option Right will terminate on the earliest
of the following dates:

        (a) Two years after the Non-Employee Director ceases to serve on the Board
as a result of his death or Retirement;

Page 1 of 4

 

 

EXHIBIT 10.2

NS GROUP, INC. NON-EMPLOYEE DIRECTOR EQUITY PLAN

NONQUALIFIED STOCK OPTION AGREEMENT

        (b) Ninety days after the Non-Employee Director ceases to serve on the
Board for any reason other than as described in Section 5(a); or

        (c) Ten years from the Date of Grant.

        Notwithstanding anything contained in this Section 5 to the contrary, in
the event of a Change in Control, the Option Right will terminate on the
earliest of the following dates: (i) five years after the Change in Control or
(ii) ten years from the Date of Grant.

     6. Issuance of Common Shares. Subject to the terms and conditions of this
Agreement, Common Shares shall be issuable to the Non-Employee Director as soon
as administratively practicable following the date the Non-Employee Director
exercises the Option Right in accordance with Section 2 hereof and makes full
payment to the Company of the Option Price. The Non-Employee Director shall
not possess any incidents of ownership (including, without limitation, dividend
and voting rights) in the Common Shares until such Common Shares have been
issued to the Non-Employee Director in accordance with this Section 6.

     7. Transferability. Except with the consent of the Board, the Option
Right may not be sold, exchanged, assigned, transferred, pledged, encumbered or
otherwise disposed of by the Non-Employee Director; provided, however, that the
Non-Employee Director’s rights with respect to such Option Right may be
transferred by will or pursuant to the laws of descent and distribution. Any
purported transfer or encumbrance in violation of the provisions of this
Section 7 shall be void, and the other party to any such purported transaction
shall not obtain any rights to or interest in such Option Right. The Option
Right may be exercised, during the lifetime of the Non-Employee Director, only
by the Non-Employee Director, or in the event of his legal incapacity, by his
guardian or legal representative acting on behalf of the Non-Employee Director
in a fiduciary capacity under state law and court supervision. Common Shares
acquired upon the exercise of the Option Right may not be transferred for six
months, except in the case of the Non-Employee Director’s death, disability or
other termination of service.

     8. No Service Contract. Nothing contained in this Agreement shall confer
upon the Non-Employee Director any right with respect to continuance of service
on the Board, nor limit or affect in any manner the right of the Company or its
stockholders to terminate the service or adjust the compensation of the
Non-Employee Director.

     9. Taxes and Withholding. To the extent that the Company shall be
required to withhold any federal, state, local or other taxes in connection
with Common Shares obtained upon the exercise of the Option Right, it shall be
a condition to the issuance of such Common Shares that the Non-Employee
Director shall pay such taxes or make provisions that are satisfactory to the
Company for the payment thereof. The Non-Employee Director may elect to
satisfy all or any part of any such withholding obligation by surrendering
to the Company a portion of the Common Shares that are issued or transferred to
the Non-Employee Director upon the exercise of the Option Right, and the Common
Shares so surrendered by the Non-Employee Director shall be credited against
any such withholding obligation at the Market Value per Share of such shares on
the date of such surrender.

Page 2 of 4

 

 

EXHIBIT 10.2

NS GROUP, INC. NON-EMPLOYEE DIRECTOR EQUITY PLAN

NONQUALIFIED STOCK OPTION AGREEMENT

     10. Compliance with Law. The Company shall make reasonable efforts to
comply with all applicable federal and state securities laws and listing
requirements of the New York Stock Exchange or any national securities
exchange; provided, however, notwithstanding any other provision of this
Agreement, the Company will not be obligated to issue any Common Shares
pursuant to this Agreement if the issuance thereof would result in a violation
of any such law or listing requirement.

     11. Adjustments. The Board may make or provide for such adjustments in
the Option Price and in the number and kind of shares of stock covered by this
Agreement, as the Board, in its sole discretion, exercised in good faith, may
determine is equitably required to prevent dilution or enlargement of the
Non-Employee Director’s rights that otherwise would result from (a) any stock
dividend, stock split, combination of shares, recapitalization, or other change
in the capital structure of the Company, (b) any merger, consolidation,
spin-off, split-off, spin-out, split-up, reorganization, partial or complete
liquidation, or other distribution of assets (including, without limitation, a
special or large non-recurring dividend) or issuance of rights or warrants to
purchase securities, or (c) any other corporate transaction or event having an
effect similar to any of the foregoing. In the event of any such transaction
or event, the Board, in its discretion, may provide in substitution for the
Common Shares such alternative consideration as it may determine to be
equitable in the circumstances and may require in connection therewith the
surrender of the Common Shares.

     12. Availability of Common Shares. The Company shall at all times until
the expiration or forfeiture of the Option Right reserve and keep available,
either in its treasury or out of its authorized but unissued Common Shares, the
full number of Common Shares deliverable upon the exercise of the Option Right
awarded under this Agreement.

     13. Amendments. Subject to the terms of the Plan, the Board may modify
this Agreement upon written notice to the Non-Employee Director. Any amendment
to the Plan shall be deemed to be an amendment to this Agreement to the extent
that the amendment is applicable hereto. Notwithstanding the foregoing, no
amendment of the Plan or this Agreement shall adversely affect the rights of
the Non-Employee Director under this Agreement without the Non-Employee
Director’s consent.

     14. Severability. In the event that one or more of the provisions of this
Agreement shall be invalidated for any reason by a court of competent
jurisdiction, any provision so
invalidated shall be deemed to be separable from the other provisions
hereof, and the remaining provisions hereof shall continue to be valid and
fully enforceable.

     15. Relation to Plan. The Option Right granted under this Agreement and
all the terms and conditions hereof are subject to the terms and conditions of
the Plan. This Agreement and the Plan contain the entire agreement and
understanding of the parties with respect to the subject matter contained in
this Agreement, and supersede all prior written or oral communications,
representations and negotiations in respect thereto. In the event of any
inconsistency between the provisions of this Agreement and the Plan, the Plan
shall govern. Capitalized terms used herein without definition shall have the
meanings assigned to them in the

Page 3 of 4

 

 

EXHIBIT 10.2

NS GROUP, INC. NON-EMPLOYEE DIRECTOR EQUITY PLAN

NONQUALIFIED STOCK OPTION AGREEMENT

Plan. The Board acting pursuant to the Plan, as constituted from time to time,
shall, except as expressly provided otherwise herein, have the right to
determine any questions which arise in connection with the grant or exercise of
the Option Right.

     16. Successors and Assigns. Without limiting Section 7 hereof, the
provisions of this Agreement shall inure to the benefit of, and be binding
upon, the successors, administrators, heirs, legal representatives and assigns
of the Non-Employee Director, and the successors and assigns of the Company.

     17. Governing Law. The interpretation, performance, and enforcement of
this Agreement shall be governed by the laws of the Commonwealth of Kentucky,
without giving effect to the principles of conflict of laws thereof.

     18. Notices. Any notice to the Company provided for herein shall be in
writing to the Company and any notice to the Non-Employee Director shall be
addressed to the Non-Employee Director at his or her address on file with the
Company. Except as otherwise provided herein, any written notice shall be
deemed to be duly given if and when delivered personally or deposited in the
United States mail, first class certified or registered mail, postage and fees
prepaid, return receipt requested, and addressed as aforesaid. Any party may
change the address to which notices are to be given hereunder by written notice
to the other party as herein specified (provided that for this purpose any
mailed notice shall be deemed given on the third business day following deposit
of the same in the United States mail).

     IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
on its behalf by its duly authorized officer and the Non-Employee Director has
also executed this Agreement in duplicate, as of the day and year first above
written.

	 	 	 
	

	 	NS GROUP, INC.
	

	 	 
	

	 	By:___________________
	

	 	Name:
	

	 	Title:

     The undersigned hereby acknowledges receipt of an executed original of
this Agreement and accepts the award of the Option Right granted thereunder on
the terms and conditions set forth herein and in the Plan.

	 	 	 
	

	 	______________________
	

	 	Non-Employee Director
	

	 	 
	

	 	Date: __________________

Page 4 of 4

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