Document:

Form of Corporate Reorganization Agreement

 Exhibit 10.3 
  
 CORPORATE REORGANIZATION AGREEMENT 
  
 This CORPORATE REORGANIZATION AGREEMENT (this “Agreement”), is entered into on
[                    ], 2006, by and among Inversora Siderurgica Limited, a company limited by shares organized and existing under the laws of
Gibraltar (“ISL”), and Ternium S.A., a société anonyme holding organized and existing under the laws of Luxembourg (“Ternium”, and together with ISL, the “Parties”). 

 
 WHEREAS, on August 22, 2005 I.I.I.-Industrial Investments Inc., a
British Virgin Islands company and a wholly-owned subsidiary of Ternium (“I.I.I.”), acquired a 70% interest in Hyslamex, S.A. de C.V. (“Hylsamex”), a leading Mexican manufacturer of flat steel products, and a 7.49%
equity interest in Consorcio Siderurgia Amazonia Ltd., a Cayman Islands corporation (“Amazonia”), and a 11.11% equity interest in Ylopa – Serviços de Consultadoria Lda. owned by the then controlling shareholder of
Hylsamex (the “Acquisition”); 
  
 WHEREAS, the
Acquisition by I.I.I. was financed through (i) a US$ 1.0 billion credit facility under that certain second amended and restated credit agreement dated August 16, 2005 among I.I.I., the lenders named therein, and Citibank, N.A. as
administrative agent and collateral agent (as further amended, amended and restated, or supplemented from time to time, the “Credit Agreement”); and (ii) several convertible and subordinated loans for an aggregate principal
amount of US$ 594,021,623.72 (collectively, the “Convertible Loans”) from various affiliated and unaffiliated lenders (collectively, the “Subordinated Lenders”) under several convertible and subordinated loan
agreements, dated as of various dates, each among I.I.I., as borrower, the relevant lenders party thereto, as lenders, and Ternium (collectively, the “Convertible and Subordinated Loan Agreements”); 
  
 WHEREAS, on September 22, 2005, I.I.I. assigned to Ternium, and Ternium
assumed, all of I.I.I.’s rights and obligations under each of the Credit Agreement and the Convertible and Subordinated Loan Agreements; 
  
 WHEREAS, each of the Convertible and Subordinated Loan Agreements provides that, if Ternium enters into a firm commitment underwriting agreement with an
independent underwriter for the sale of shares of its capital stock (such shares, the “Ternium Shares”), or other securities evidencing Ternium Shares, on any regulated market (such transaction, the “IPO”), then
Ternium, on the date on which such Ternium Shares are delivered to the underwriters for the IPO (the “IPO Settlement Date”), shall deliver Ternium Shares to the Subordinated Lenders in lieu of payment of the aggregate principal
amount of the Convertible Loans then outstanding plus interest accrued thereon (whether or not then due and payable); 
  
 WHEREAS, on November 11, 2005, ISL entered into an exchange agreement with Siderúrgica del Turbio, S.A. “SIDETUR”, a company
organized and existing under the laws of Venezuela (“Sidetur”), pursuant to which, and subject to the conditions set forth in that agreement, on November 17, 2005, Sidetur exchanged with ISL 20,328,784 Class “C”
shares (the “Amazonia Shares”) representing approximately 3.42% of the total issued and outstanding capital of Amazonia, for 33,800,735 Ternium Shares (the “ISL - Sidetur Exchange”); 
  

 1 

 WHEREAS, on
[                            ], 2006, Ternium entered into an Underwriting Agreement (the
“Underwriting Agreement”) with Citigroup Global Markets Inc. and
[                                        ]
(the “Underwriters”) for the sale of [                    ]Ternium Shares or its equivalent in American Depositary Shares,
each representing 10 Ternium Shares; 
  
 WHEREAS, ISL and Ternium
have determined that it is in the best interest of each of them that, on the terms and subject to the conditions set forth in this Agreement, ISL (1) assume an irrevocable commitment to deliver to the Subordinated Lenders under the Convertible
and Subordinated Loan Agreements, on Ternium’s behalf, Ternium Shares in an amount sufficient to satisfy Ternium’s obligations thereunder; (2) assume an irrevocable commitment to deliver to the Underwriters, on Ternium’s behalf,
Ternium Shares in an amount sufficient to satisfy Ternium’s obligations under the Underwriting Agreement; and (3) following each such delivery of Ternium Shares by ISL, make a capital contribution to Ternium consisting of all of ISL’s
assets and liabilities in exchange for newly-issued Ternium Shares. 
  
 NOW, THEREFORE, in consideration of the promises and the mutual agreements and covenants hereinafter set forth, the Parties hereby agree as follows: 
  
 ARTICLE I 
 DELIVERY OF TERNIUM SHARES
TO THE SUBORDINATED LENDERS 
  
 Section 1.1 Delivery
of Ternium Shares to the Subordinated Lenders. (a) On the IPO Settlement Date, ISL shall deliver, or cause to be delivered, to the Subordinated Lenders Ternium Shares in an amount sufficient to satisfy Ternium’s obligation under each
of the Convertible and Subordinated Loan Agreements to deliver Ternium Shares to the Subordinated Lenders. 
  
 (b) ISL and Ternium agree and acknowledge that by delivering Ternium Shares to the Subordinated Lenders, ISL will be acting on behalf and
as an agent of Ternium. 
  
 (c) In consideration
of ISL’s delivery of Ternium Shares to the Subordinated Lenders, ISL shall receive from Ternium a note (the “Subordinated Loan Note”) in substantially the terms of Exhibit A hereto evidencing Ternium’s obligation to pay to
ISL (as provided in Section 1.1(d)) an amount equal to the U.S. dollar amount that would result from multiplying the number of Ternium Shares delivered by ISL to the Subordinated Lenders times the IPO Price. 
  
 (d) The Subordinated Loan Note may only be settled and
discharged as provided in Section 3.1 of this Agreement. 
  

 2 

 ARTICLE II 
 DELIVERY OF TERNIUM SHARES TO THE UNDERWRITERS 
  
 Section 2.1 Delivery of Ternium Shares to the Underwriters for the IPO. (a) On the IPO Settlement Date, ISL shall deliver, or cause to be delivered, to the Underwriters Ternium Shares in an amount
sufficient to satisfy Ternium’s obligations under the Underwriting Agreement to deliver Ternium Shares to the Underwriters. 
  
 (b) ISL and Ternium agree and acknowledge that by delivering Ternium Shares to the underwriters for the IPO pursuant to the terms of the
IPO, ISL will be acting on behalf and as an agent of Ternium. 
  
 (c) In consideration of ISL’s delivery of Ternium Shares to the underwriters for the IPO, ISL shall receive from Ternium a note (the “IPO Note”) in substantially the terms of Exhibit B hereto
evidencing Ternium’s obligation to pay to ISL (as provided in Section 2.1(d)) an amount equal to the U.S. dollar amount that would result from multiplying the number of Ternium Shares delivered by ISL to the Underwriters times the
IPO Price. 
  
 (d) The IPO Note may only be
settled and discharged as provided in Section 3.1 of this Agreement. 
  
 Section 2.2 Indemnification and Contribution. (a) Ternium will indemnify and hold harmless ISL, the directors, officers, employees and agents of ISL and each person who controls ISL within the meaning
of either the Securities Act of 1933, as amended (the “Act”) or the Securities Exchange Act of 1934, as amended (the “Exchange Act”) against any losses, claims, damages or liabilities, joint or several, to which ISL may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement or in the ADR Registration Statement, any Preliminary Prospectus or the Prospectus, or any amendment or supplement thereto, any Issuer Free Writing Prospectus or any “issuer information” filed or required to be filed
pursuant to Rule 433(d) under the Act, (in each case, as defined in the Underwriting Agreement) or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse ISL for any legal or other expenses reasonably incurred by ISL in connection with investigating or defending any such action or claim as such expenses are incurred. 
  
 (b) Promptly after receipt by an indemnified party under
subsection (a) above of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under such subsection. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and, after notice from the indemnifying party to
such indemnified party of its election so to assume the 
  

 3 

 defense thereof, the indemnifying party shall not be liable to such indemnified party under such
subsection for any legal expenses of other counsel or any other expenses, in each case subsequently incurred by such indemnified party, in connection with the defense thereof other than reasonable costs of investigation. No indemnifying party shall,
without the written consent of the indemnified party, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification or contribution may
be sought hereunder (whether or not the indemnified party is an actual or potential party to such action or claim) unless such settlement, compromise or judgment (i) includes an unconditional release of the indemnified party from all liability
arising out of such action or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any indemnified party. 
  
 (c) If the indemnification provided for in this Section 2.2 is unavailable to or insufficient to hold
harmless an indemnified party under subsection (a) above in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable
by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of Ternium on the one hand and ISL on the other in connection
with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by Ternium, it being acknowledged that ISL supplied no information, and the
Parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. Ternium and ISL agree that it would not be just and equitable if contributions pursuant to this subsection
(c) were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to above in this subsection (c). The amount paid or payable by an indemnified party as a result
of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this subsection (c) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 2.2, each person who controls ISL within the meaning of either the Act or the Exchange Act and each director, officer, employee and agent of ISL shall have the same rights to contribution as ISL,
and each person who controls Ternium within the meaning of either the Act or the Exchange Act, each officer of Ternium who shall have signed the Registration Statement and the ADR Registration Statement and each director of Ternium shall have the
same rights to contribution as Ternium, subject in each case to the applicable terms and conditions of this subsection (c). 
  
 (d) The obligations of Ternium under this Section 2.2 shall be in addition to any liability which Ternium may otherwise have and
shall extend, upon the same terms and conditions, to each person, if any, who controls ISL within the meaning of the Act. 
  

 4 

 ARTICLE III 
 CONTRIBUTION OF ALL ASSETS AND LIABILITIES 
  
 Section 3.1 Contribution of all assets and liabilities. (a) As soon as practicable after delivery of the Ternium Shares to the Subordinated Lenders and the Underwriters pursuant to Sections 1.1 and
2.1 of this Agreement, ISL shall contribute, transfer and deliver to Ternium all of its assets and liabilities as of that date, free and clear of all liens, charges, pledges, security interests or encumbrances of any nature whatsoever, and Ternium
shall receive, accept and acquire such assets and liabilities (the “Contribution”). The assets subject of the Contribution shall consist of any Ternium Shares not delivered to the Subordinated Lenders or the Underwriters pursuant to
Sections 1.1 and 2.1 of this Agreement (the “Remaining Ternium Shares”), the Subordinated Loan Note, and the IPO Note, and the Amazonia Shares. 
  
 (b) Upon receipt of the Contribution, Ternium shall issue and deliver to ISL 959,482,775 fully paid-up
Ternium Shares calculated as follows: 
  
 (i) one
Ternium Share for each Remaining Ternium Share contributed by ISL to Ternium pursuant to the Contribution; and 
  
 (ii) one Ternium Share for each Ternium Share delivered, or caused to be delivered, by ISL pursuant to Sections 1.2 and 2.1 of this
Agreement; and 
  
 (iii) 33,800,735 Ternium
Shares for the Amazonia Shares contributed to Ternium pursuant to the Contribution. 
  
 (c) The aggregate value of the assets and liabilities of ISL comprising the Contribution shall be determined by Ternium on the closing
date of the Contribution in a form acceptable under Luxembourg law, and shall be allocated pursuant to the following formula: 
  
 (i) one U.S. dollar (US$ 1) for each newly issued Ternium Share to share capital; 
  
 (ii) 10% of the nominal value for each newly issued Ternium
Share to legal reserve. 
  
 (iii) 10% of the
aggregate value of the Contribution to a freely distributable share premium account; and 
  
 (iv) the remaining portion of the value of the Contribution to a restricted share premium account. 
  
 (d) The Contribution shall be consummated as soon as
practicable after the delivery of the Ternium Shares pursuant to Sections 1.1 and 2.1 herein at such place and at such date as ISL and Ternium may mutually agree upon. 
  

 5 

 ARTICLE IV 
 REPRESENTATIONS AND WARRANTIES 
  
 Section 4.1 Each Party represents and warrants to the other Party, as of the date hereof and as of the closing date of the Contribution, as follows: 
  
 (a) Organization, etc. Such Party is a company or a corporation duly organized and validly existing
under the laws of the jurisdiction of its incorporation. Such Party has all necessary power and authority to own, operate or lease the properties and assets now owned, operated or leased by it and to carry on its business as now being conducted.
Such Party is duly licensed or qualified to do business and is in good standing in each jurisdiction in which the properties owned or leased by it or the operation of its business makes such licensing or qualification necessary. 
  
 (b) Authorization; Non-contravention. Each Party has
(and will have) all necessary power and authority to enter into this Agreement, to carry out its obligations hereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement by such Party,
the performance by such Party of its obligations hereunder and the consummation by such Party of the transactions contemplated hereby have been duly authorized by all requisite action on the part of such Party, and do not contravene or constitute a
default under (a) any provision of applicable law or regulation, (b) the articles of association or by-laws of such Party or (c) any material agreement, judgment, injunction, order, decree or other instrument binding upon such Party
or its shareholders. 
  
 (c) Binding Effect.
This Agreement has been duly executed and delivered by such Party, and (assuming due authorization, execution and delivery by the other Party thereto) this Agreement constitutes a legal, valid and binding obligation of such Party enforceable
against such Party in accordance with their terms, subject to the effect of any applicable bankruptcy, insolvency (including, without limitation, all laws relating to fraudulent transfers), reorganization, moratorium or similar law affecting
creditors’ rights. 
  
 (d) Governmental
Authorities Consents and Approvals. The execution and delivery of this Agreement and the performance of this Agreement by such Party does not require any filing with or consent, approval, exemption or authorization by any governmental
authorities. 
  
 (e) Shares. The Ternium
Shares to be delivered pursuant to Section 2.1 of this agreement are free and clear of any perfected security interest or any other security interests, claims, liens or encumbrances, and, upon delivery by ISL to the Underwriters in accordance
with this Agreement and upon the sale and delivery to the Underwriters and payment therefore, pursuant to the Underwriting Agreement, the Underwriters will acquire good, marketable and valid title to such Ternium Shares, free and clear of all
pledges, liens, security interests charges, claims or encumbrances of any kind. 
  
 ARTICLE V 
 GENERAL PROVISIONS 
  
 Section 5.1 Notices. All communications between the parties or notices or other information sent under this
Agreement shall be in writing, hand delivered or sent by overnight courier or telecopier, addressed to the relevant party at the address or facsimile number set forth below or at such other address or facsimile number as such party may request in
writing in the manner aforesaid. All such communications and notices shall be effective upon receipt. 
  

 6 

	 	(a)	If to ISL, to: 

  
 Inversora Siderurgica Limited 
 Av. Leandro
N. Alem 1067, piso 28 
 C1001AAF, Buenos Aires 
 Argentina 
 Telephone: +54 (11) 4018-2224 
 Facsimile: +54 (11) 4018-2082 
 Attention: Umberto Bocchini, Director 
  

	 	(b)	If to Ternium, to: 

  
 Ternium S.A. 
 Av. Leandro N. Alem 1067,
piso 28 
 C1001AAF, Buenos Aires 
 Argentina 
 Telephone: +54 (11) 4018-2244 
 Facsimile: +54 (11) 4018-2802 
 Attention: Raúl H. Darderes, Secretary 
  
 Section 5.2 Assignment. Neither of the Parties hereto may assign
any of its rights or obligations under this Agreement without the prior written consent of the other Party. 
  
 Section 5.3 Waivers. No failure or delay by either Party in exercising any right or power hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. 

 
 Section 5.4 Amendments. The terms and provisions of this
Agreement may only be modified, waived, discharged or terminated by an instrument in writing signed by each of the Parties. 
  
 Section 5.5 Successors and Assigns. The provisions of this Agreement shall be binding upon and inure to the benefit of the Parties and their
respective successors and permitted assigns. 
  
 Section 5.6
No Third-Party Beneficiaries. This Agreement is made solely and specifically among and for the benefit of the Parties and their respective successors and permitted assigns, subject to the express provisions hereof relating to successors and
permitted assigns, and no other person shall have any rights, interest or claims hereunder or be entitled to any benefits under or on account of this Agreement as a third-party beneficiary or otherwise, provided, however, that Citigroup Global
Markets, Inc., in its capacity as an Underwriter in respect of the IPO, shall be a third party beneficiary hereof and shall be entitled to enforce the terms hereof. 
  
 Section 5.7 Counterparts. This Agreement may be executed in counterparts (and by each Party on a separate
counterpart), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Agreement by facsimile shall be effective as delivery
of a manually executed counterpart of this Agreement. 
  

 7 

 Section 5.8 Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of New York. 
  
 Section 5.9 Severability.
The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision. Any invalid or unenforceable provision shall be deemed severed from this Agreement; provided
that the Parties shall negotiate in good faith an amendment to such invalid or unenforceable provision that fulfills the original intent of the Parties. 
  

Section 5.10 Further Assurances. Each of the Parties hereto agrees to execute and deliver, or to cause to be executed and delivered, all
such instruments, and to take all such action as any other party hereto may reasonably request in order to effectuate the intent and purposes of, and to carry out the terms of this Agreement. 
  
 Section 5.11 Indemnities to Survive. The respective indemnities
of Ternium and ISL, as set forth in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall remain in full force and effect, regardless of any investigation (or any statement as to the results thereof) made by
or on behalf of ISL or any controlling person of ISL, or Ternium, or any officer or director or controlling person of Ternium, and shall survive delivery of the Ternium Shares pursuant to Article 2. The provisions of Section 2.2 hereof shall
survive the termination or cancellation of this Agreement. 
  
 [REMAINDER OF THE PAGE INTENTIONALLY LEFT BLANK] 
  

 8 

 IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the duly authorized officers
of the parties hereto on the date first here and above written. 
  

			
	INVERSORA SIDERURGICA LIMITED
		
	By:	 	  

	Name:	 	 
	Title:	 	 
		
	By:	 	  

	Name:	 	 
	Title:	 	 
	
	TERNIUM S.A.
		
	By:	 	  

	Name:	 	 
	Title:	 	 
		
	By:	 	  

	Name:	 	 
	Title:	 	 

  

 9 

 EXHIBIT “A” 
  
 FORM OF 
 SUBORDINATED LOAN NOTE 
  
 [New York, New York]

 [                    ], 2006

  
 US$ [·] 
  
 For value received, Ternium
S.A., a Luxembourg société anonyme holding (“Ternium”), hereby promises to pay to the order of Inversora Siderurgica Limited, a Gibraltar company (“ISL”) the principal amount of US$
[·] ([                    ] dollars of
the United States of America), pursuant to the terms of the Corporate Reorganization Agreement referred to below, on the date and subject to the terms specified in the Corporate Reorganization Agreement. This instrument shall bear no interest.

  
 This instrument represents the Subordinated Loan Note
referred to in, and is entitled to the benefit of, the Corporate Reorganization Agreement dated as of [                    ], 2006 (the
“Corporate Reorganization Agreement”) among ISL and Ternium. Terms defined in the Corporate Reorganization Agreement are used herein with the same meanings unless otherwise defined herein. Reference is made to the Corporate
Reorganization Agreement for all other provisions of the Corporate Reorganization Agreement relating hereto including without limitation, the provision that the Subordinated Loan Note may only be settled and discharged as provided in
Section 3.1 of the Corporate Reorganization Agreement. For the avoidance of doubt, no claim for payment of money can be made hereunder. 
  
 This Subordinated Loan Note shall be governed by, and construed in accordance with, the law of the State of New York. Any suit, action, or proceeding
with respect to this Subordinated Loan Note may be brought in the Supreme Court of the State of New York, County of New York. 
  
 IN WITNESS WHEREOF, Ternium has caused this Subordinated Loan Note to be duly executed and delivered as of the date first written above. 
  

			
	TERNIUM S.A.
		
	By:	 	  

	Name:	 	 
	Title:	 	 
		
	By:	 	  

	Name:	 	 
	Title:	 	 

  

 A-1 

 EXHIBIT “B” 
  
 FORM OF 
 IPO NOTE 
  
 [New York, New York] 
 [                    ], 2006 
  
 US$ [·] 
  
 For value received, Ternium
S.A., a Luxembourg société anonyme holding (“Ternium”), hereby promises to pay to the order of Inversora Siderurgica Limited, a Gibraltar company (“ISL”) the principal amount of US$
[·] ([                    ] dollars of
the United States of America), pursuant to the terms of the Corporate Reorganization Agreement referred to below, on the date and subject to the terms specified in the Corporate Reorganization Agreement. This instrument shall bear no interest.

  
 This instrument represents the IPO Note referred to in, and is
entitled to the benefit of, the Corporate Reorganization Agreement dated as of [                    ], 2005 (the “Corporate
Reorganization Agreement”) among ISL and Ternium. Terms defined in the Corporate Reorganization Agreement are used herein with the same meanings unless otherwise defined herein. Reference is made to the Corporate Reorganization Agreement
for all other provisions of the Corporate Reorganization Agreement relating hereto including without limitation, the provision that the IPO Note may only be settled and discharged as provided in Section 3.1 of the Corporate Reorganization
Agreement. For the avoidance of doubt, no claim for payment of money can be made hereunder. 
  
 This IPO Note shall be governed by, and construed in accordance with, the law of the State of New York. Any suit, action, or proceeding with respect to this IPO Note may be brought in the Supreme Court of the State of
New York, County of New York. 
  
 IN WITNESS WHEREOF, Ternium has
caused this IPO Note to be duly executed and delivered as of the date first written above. 
  

			
	TERNIUM S.A.
		
	By:	 	  

	Name:	 	 
	Title:	 	 
		
	By:	 	  

	Name:	 	 
	Title:	 	 

  

 B-1Shareholders' Agreement,  dated 01/09/2006

 Exhibit 10.5 
  

  
 SHAREHOLDERS’ AGREEMENT 
  
 between

  
 TENARIS S.A. 
  
 and 
  
 INVERSORA SIDERURGICA LIMITED 
  
 Dated as of January 9, 2006 
  

 TABLE OF CONTENTS 
  

					
	 	  	 	  	Page

	 	  	ARTICLE I	  	 
			
	 	  	DEFINITIONS AND GENERAL INTERPRETATIVE PRINCIPLES	  	 
			
	 SECTION 1.1
	  	 Definitions
	  	1
	 SECTION 1.2
	  	 General Interpretive Principles
	  	2
			
	 	  	ARTICLE II	  	 
			
	 	  	REPRESENTATIONS AND WARRANTIES	  	 
			
	 SECTION 2.1
	  	 Representations and Warranties of the Parties
	  	3
			
	 	  	ARTICLE III	  	 
			
	 	  	GOVERNANCE	  	 
			
	 SECTION 3.1
	  	 The Board of Directors
	  	3
	 SECTION 3.2
	  	 Vacancies
	  	4
	 SECTION 3.3
	  	 Other Covenants
	  	4
			
	 	  	ARTICLE IV	  	 
			
	 	  	SHAREHOLDER’S MEETINGS AND VETO RIGHTS	  	 
			
	 SECTION 4.1
	  	 Shareholders’ Meetings
	  	4
	 SECTION 4.2
	  	 Veto Rights
	  	4
			
	 	  	ARTICLE V	  	 
			
	 	  	TRANSFER RESTRICTIONS	  	 
			
	 SECTION 5.1
	  	 Permitted transfers
	  	5
	 SECTION 5.2
	  	 Offer Notice Requirement
	  	5
	 SECTION 5.3
	  	 Tag-Along Rights
	  	5

  

 ii 

					
	 	  	ARTICLE VI	  	 
			
	 	  	GOVERNING LAW; DISPUTE RESOLUTION	  	 
			
	 SECTION 6.1
	  	 Governing Law
	  	7
	 SECTION 6.2
	  	 Dispute Resolution
	  	7
			
	 	  	ARTICLE VII	  	 
			
	 	  	MISCELLANEOUS PROVISIONS	  	 
			
	 SECTION 7.1
	  	 Expenses
	  	7
	 SECTION 7.2
	  	 Validity of the Agreement
	  	7
	 SECTION 7.3
	  	 Termination of Agreement
	  	8
	 SECTION 7.4
	  	 Notices
	  	8
	 SECTION 7.5
	  	 Counterparts
	  	8
	 SECTION 7.6
	  	 Entire Agreement
	  	8
	 SECTION 7.7
	  	 Waivers and Amendments
	  	9
	 SECTION 7.8
	  	 Language
	  	9
	 SECTION 7.9
	  	 No Third Party Rights; Assignment
	  	9
	 SECTION 7.10
	  	 Specific Performance
	  	9
	 SECTION 7.11
	  	 Further Assurances
	  	9
	 SECTION 7.12
	  	 Severability
	  	9
	 SECTION 7.13
	  	 Term
	  	9

  

 iii 

 SHAREHOLDERS’ AGREEMENT 
  
 SHAREHOLDERS’ AGREEMENT (the “Agreement”), dated as of January 9, 2006 by and between Tenaris S.A.
(together with its successors, “Tenaris”), a société anonyme holding organized under the laws of the Grand-Duchy of Luxembourg (“Luxembourg”) and Inversora Siderurgica Limited (together with its
successors, “ISL”), a company organized under the laws of Gibraltar. Tenaris, ISL and any successor or permitted assignee thereof from time to time are each referred to herein as a “Party” and, collectively, the
“Parties.” 
  
 RECITALS 
  
 WHEREAS, the Parties desire to enter into certain arrangements relating to
the operation of Ternium S.A., a société anonyme holding organized under the laws of the Grand-Duchy of Luxembourg (the “Company”), and to set forth certain rights and restrictions related to the ownership,
transfer and disposition of their respective shares of capital stock (the “Shares”) in such Company. 
  
 NOW THEREFORE, in consideration of the foregoing and the mutual representations and warranties, promises, covenants and agreements of the Parties hereto,
and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties, agree as follows: 
  
 ARTICLE I 
 DEFINITIONS AND GENERAL
INTEPRETATION PRINCIPLES 
  
 SECTION 1.1 Definitions.
Capitalized terms used and not otherwise defined in this Agreement shall have the meanings assigned to them in this Section 1.1 (such meanings to be equally applicable to both the singular and the plural form of the terms defined). 

 
 “Affiliate” of a Person means with
respect to any Person, a Person that, directly or through one or more intermediaries, Controls, or is Controlled by, or is under common Control with, the first Person. 
  
 “Agreement” means this Agreement. 
  
 “Beneficial Ownership” or
“Beneficially Owns” means, with respect to any Shares, the ability to, directly or indirectly, vote and direct the disposition of such Shares; provided that, if the Person asserting such beneficial ownership is not the
registered owner of such Shares, such Person shall have reasonably demonstrated (or be capable of reasonably demonstrating) his or its ability to vote and direct the disposition of such Shares. 
  
 “Business Day” means any day other than a
Saturday, Sunday, or a day on which banking institutions in the City of New York, Gibraltar or Luxembourg are authorized or obligated by law or executive order to be closed. 
  
 “Company” has the meaning set forth in the recitals. 
  

 1 

 “Control” means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether through holding ownership interests in such Person, by Contract or otherwise. 
  

“General Rules” has the meaning set forth in Section 6.2. 
  
 “ICC” has the meaning set forth in
Section 6.2. 
  
 “ISL” has
the meaning set forth in the preamble hereto. 
  
 “Lien” means any mortgage, lien, easement, charges, other real estate declaration, pledge, security interest, right of first refusal, fiduciary assignment, voting agreement, restriction on transfer or voting, option or
similar encumbrance. 
  
 “Offer
Notice” has the meaning set forth in Section 5.2. 
  
 “Party” or “Parties” has the meaning set forth in the preamble hereto. 
  
 “Person” means any individual, any legal entity (including, without limitation, a corporation, a société
anonyme, a partnership, a limited liability company, or a legal entity of public law), a branch of any legal entity, any trust, unincorporated organization, joint stock company, joint venture, association or other entity. 
  
 “Shares” has the meaning set forth in the
recitals. 
  
 “Subsidiary”
means, with respect to any Person, a legal entity which such Person Controls or of which such Person Beneficially Owns more than 50% of the voting shares or otherwise. 
  
 “Tag-Along Notice” has the meaning set forth in Section 5.3(a). 
  
 “Tenaris” has the meaning set forth in the
preamble hereto. 
  
 “U.S.$” or
“U.S. Dollar” means the lawful currency of the United States. 
  
 SECTION 1.2 General Interpretive Principles. Unless otherwise specified, all references to “days” or “day-periods” shall mean calendar days. Where this Agreement establishes time periods
counted in calendar days and such calendar day period expires on a day that is not a Business Day, then such calendar day period shall be deemed to expire on the next succeeding Business Day. 
  

 2 

 ARTICLE II 
 REPRESENTATIONS AND WARRANTIES 
  
 SECTION 2.1 Representations and Warranties of the Parties. Each of the Parties represents and warrants to the other on the date hereof as follows: 
  
 (a) Authority. Such Party has the corporate power and authority to enter into this Agreement and to
carry out its obligations hereunder. Such Party is duly organized and validly existing under the laws of its jurisdiction of organization. The execution of this Agreement and the consummation of the transactions contemplated herein have been duly
authorized by all necessary actions, and no other act or proceeding, corporate or otherwise, is necessary to authorize the execution of this Agreement or the consummation of any of the transactions contemplated hereby. 
  
 (b) Enforceability. This Agreement has been duly
executed and delivered by such Party and constitutes its legal, valid and binding obligations, enforceable against such Party in accordance with its terms, subject to any applicable bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium, and similar laws of general applicability relating to or affecting creditors’ rights and general equity principles. 
  
 (c) No Conflicts. There is no provision of any law, statute, regulation, rule, order, injunction, decree, writ or judgment, no
provision of the articles of association, bylaws or other constituent or governing documents of any Party and no provision of any mortgage, indenture, contract or other agreement to which any Party is a party or affecting its properties which would
prohibit, conflict with, or in any way prevent execution and delivery or performance of the terms of this Agreement. 
  
 (d) Consents. No consent, waiver, approval, authorization, exemption, registration, license or declaration is required to be made
or obtained by such Party, in connection with (i) the execution, delivery or enforceability of this Agreement to be entered into by such Party or (ii) the consummation of any of the transactions contemplated herein. 
  
 ARTICLE III 
 GOVERNANCE 
  
 SECTION 3.1 Board of Directors. ISL shall take all actions within its power to cause that, so long as Tenaris Beneficially Owns (either directly or indirectly trough its Subsidiaries) at least five per cent (5%) of the
Company’s capital stock: 
  
 (a) one of the
members of the Company’s board of directors be nominated by Tenaris; and 
  

 3 

 (b) any director(s) nominated by Tenaris be only removed or replaced from the
Company’s board of directors pursuant to the previous written instructions of Tenaris. 
  
 SECTION 3.2 Vacancies. If a director’s position on the Company’s board of directors shall become vacant, whether through removal, incapacity or death, each of the Parties shall take all actions within
its power to cause such vacancy to be filled, if with respect to a director nominated by Tenaris, by a new director nominated by Tenaris, and, if with respect to a director nominated by ISL, by a new director nominated by ISL. 
  
 SECTION 3.3 Other Covenants. Each Party shall take all actions within
its power to cause that, so long as Tenaris Beneficially Owns (either directly or indirectly trough its Subsidiaries) at least five per cent (5%) of the Company’s capital stock, the Company (whether acting through the chairman or any other
director or officer) refrain from giving effect, without first having received the requisite approval in the form of a resolution of the Company’s board of directors or the vote or consent of the shareholders, as applicable, to any matter for
which the board of directors or shareholder approval is required under Article IV. 
  
 ARTICLE IV 
 SHAREHOLDERS’ MEETINGS AND VETO RIGHTS 
  
 SECTION 4.1 Shareholders’ Meetings. All decisions relating to the
Company’s business and operations shall be adopted as set forth in the Company’s charter documents, except for the following matters, which shall require the affirmative vote at the shareholders’ meetings of shareholders representing
sixty per cent (60%) or more of the capital stock and the voting power of the Company: 
  
 (a) any amendment to the corporate purpose set forth in the charter documents of the Company; 
  
 (b) the delisting from all (but not less of all) of the
regulated markets in which the Company’s shares or other securities may be listed at any time in the future; 
  
 (c) any amendment to the number of the Company’s independent directors; 
  
 (d) any amendment to the number of independent members of
the Company’s Audit Committee; or 
  
 (e)
the dissolution, liquidation or winding up of the Company. 
  
 SECTION 4.2 Veto Rights. Each Party shall take all actions within its power to cause the following actions to only be approved upon the affirmative vote at the meetings of the Company’s shareholders of the Shares owned by
Tenaris: 
  
 (a) the relocation of the
Company’s domicile outside Luxembourg; or 
  
 (b) any increase in the shareholders’ commitments. 
  

 4 

 ARTICLE V 
 TRANSFER RESTRICTIONS 
  
 SECTION
5.1 Permitted transfers. (a) Any transfer of Shares, any assignment of the right to make and/or capitalize irrevocable contributions or any instrument or obligation convertible into shares of the Company, and the creation of any Lien
thereon, unless in compliance with the provisions of this Agreement, is prohibited, shall be void and ineffectual, and shall not operate to transfer any interest of title in the Shares to the purported transferee. 
  
 (b) Unless otherwise agreed to in writing by the Parties, any transfer of
Shares (including any transfer made pursuant to a public offering) shall not release the Party transferring such Shares from any liabilities or obligations it may have hereunder with respect to liabilities and obligations incurred prior to the date
of such transfer; 
  
 (c) Notwithstanding any provision in this
Agreement, ISL may transfer its Shares and consummate any other transactions as provided in that certain Corporate Reorganization Agreement to be entered into among the Company and ISL substantially in the form attached hereto as Exhibit A;
and 
  
 (d) Each Party may transfer its Shares and/or assign any
right to make and/or capitalize irrevocable contributions or any instrument or obligation convertible into shares of the Company to any Subsidiary or Affiliate thereof; provided that the transferor shall provide the other Party, at the
other Party’s request, with evidence reasonably satisfactory to such Party that such transfer complies with the requirements established herein; provided, further, that, in connection with any transfer of Shares and/or
assignment of any right to make and/or capitalize irrevocable contributions or any instrument or obligation convertible into shares of the Company to any Affiliate that is not a Subsidiary of that Party, such Affiliate shall enter into an agreement
substantially in the terms of this Agreement with the other Party as a condition precedent to any such transfer and/or assignment. 
  
 (e) Notwithstanding any other provision of this Agreement, any transfer of Shares and/or assignment of any right to make and/or capitalize irrevocable
contributions or any instrument or obligation convertible into shares of the Company pursuant to any of paragraphs (c) and (d) of this Section shall not be subject to any condition or requirement, nor shall it give rise to any right or
obligation hereunder other than those specifically set forth in the relevant paragraph. 
  
 SECTION 5.2 Offer Notice requirement. If ISL or its Subsidiaries receives a bonafide arms-length written offer to sell, directly or indirectly, all or part of its Shares to a Person (other than a Party
or any of its Subsidiaries or Affiliates), ISL shall first provide to other Party with an offer notice (the “Offer Notice”) detailing the proposed sale, including, without limitation, the total number of Shares proposed to be
transferred, the name and address of 
  

 5 

 the proposed third party transferee, the purchase price per Share and all other material payment terms including, without
limitation, the form of consideration and, in the case of non-cash consideration, the specific assets or securities constituting such consideration. The Offer Notice shall include a representation that the proposed transferee has been informed of
the terms of the tag-along rights applicable to transfers of Shares as provided for in this Article V. 
  
 SECTION 5.3 Tag-Along Rights. (a) If any of ISL or its Subsidiaries wishes to sell, directly or indirectly, all or part of its Shares to a
Person other than an Affiliate or a Subsidiary of ISL, or Tenaris or any of its Subsidiaries, ISL shall first provide Tenaris with an Offer Notice as set forth in Section 5.2, and for 20 days following Tenaris’s receipt of such Offer
Notice, Tenaris shall have the exclusive option to deliver a tag-along notice (the “Tag-Along Notice”) to ISL with respect to any or all of its Shares. 
  
 (i) The Tag-Along Notice shall specify the irrevocable election of Tenaris to require ISL to include Tenaris
(or its Subsidiary) as a third party in the proposed sale of the Shares contemplated by the Offer Notice, on substantially the same material payment terms as those specified in the Offer Notice. 
  
 (ii) If Tenaris fails to timely deliver the Tag-Along
Notice, its rights with respect to the Shares identified in the Offer Notice shall be waived and ISL may, within 30 days as from the receipt of all necessary governmental and regulatory approvals (or if no such approvals are necessary, within 60
days as from the date of the Tag-Along Notice) conclude the transfer of the Shares described in the Offer Notice, on terms and conditions not more favorable to ISL than those described in the Offer Notice. Any proposed transfer on terms and
conditions more favorable than those described in the Offer Notice, as well as any subsequent proposed transfer of any Shares by ISL after expiration of the applicable period, shall again be subject to the tag-along rights of Tenaris and shall
require compliance by ISL with the procedures described in this Section. If the Shares are not so transferred within the applicable period, the Shares shall again become subject to all of the terms and conditions of the Agreement and may not
thereafter be transferred except in the manner and on the terms herein provided. 
  
 (b) If a Tag-Along Notice has been timely delivered by Tenaris under clause (a) of this Section 5.3 and if ISL is willing and
able to effect a sale of the Shares specified in the Offer Notice and the Tag-Along Notice, then ISL shall arrange for the consideration for such Shares to be paid by the proposed transferee directly to Tenaris upon delivery by Tenaris of
certificates representing all of its Shares being sold under such clause (a) of this Section 5.3 duly endorsed and free and clear of all Liens, together with such other documents as ISL and the transferee may reasonably agree on or
request, including without limitation documents providing for representations, warranties, indemnifications, and similar agreements for the benefit of the transferee, provided that ISL is also providing equivalent documentation to the
transferee. All costs and expenses incurred by the Parties in connection with such sale shall be borne by the Parties in proportion to their share in the proceeds of the sale. 
  

 6 

 (c) For the avoidance of doubt, in case of a sale by ISL of all or part of its Shares to
any of its Affiliates or Subsidiaries, Tenaris shall not be entitled to exercise the tag-along rights set forth in this Section 5.3. 
  
 ARTICLE VI 
 GOVERNING LAW; DISPUTE RESOLUTION

  
 SECTION 6.1 Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York. 
  
 SECTION 6.2 Dispute Resolution. Any dispute, controversy or claim between the Parties arising out of, relating to or in connection this Agreement, whether based on this Agreement or otherwise, including without
limitation any dispute regarding its validity or termination, or the performance or breach thereof, to the extent not resolved by negotiations conducted during a period of 30 days, shall be finally resolved by arbitration administered by the Court
of Arbitration of the International Chamber of Commerce (the “ICC”). The arbitration shall be conducted in accordance with the ICC’s Rules of Arbitration in effect at the time (the “General Rules”),
except as they may be modified herein or by agreement of the Parties. The International Bar Association Rules of Evidence shall apply together with the General Rules governing any submission to arbitration under this Agreement. Where they are
inconsistent with the General Rules, the International Bar Association Rules of Evidence shall prevail but solely as regards the presentation and reception of evidence. The arbitral tribunal shall consist of three (3) arbitrators appointed in
accordance with the General Rules. The place of arbitration shall be in New York, NY, or any other location as the Parties may agree upon. The arbitration proceedings shall be conducted in the English language. The award rendered in any arbitration
commenced hereunder shall be final and conclusive and judgment thereon may be entered in any court having jurisdiction for its enforcement. The arbitrators shall not be authorized to decide any dispute, controversy or claim ex aequo et bono
or as amiable compositeurs but shall strictly apply the law governing this Agreement. Neither Party shall appeal to any court from the decision of the arbitration panel. 
  
 ARTICLE VII 
 MISCELLANEOUS PROVISIONS 
  
 SECTION 7.1
Expenses. Each Party shall pay its own internal and legal, accounting, and other miscellaneous expenses relating to this Agreement and the transactions contemplated hereby. 
  
 SECTION 7.2 Validity of the Agreement. If any of the provisions of this Agreement shall be illegal,
invalid or unenforceable for any reason, the Parties shall use their best efforts to re-negotiate such provision or provisions in a manner which (i) cures the legal defect giving rise to the unenforceability of such provision or provisions and
(ii) will have, in form as well as in substance, the same purpose and effect as the unenforceable provision. Notwithstanding the foregoing, the invalidity, illegality or unenforceability of any provision shall not in any way affect or impair
the validity, legality and enforceability of the remaining provisions hereof for so long as the remaining provisions do not fundamentally alter the relations between the Parties hereto. 
  

 7 

 SECTION 7.3 Termination of Agreement. (a) This Agreement shall terminate by mutual written
consent of the Parties or, at the request of any Party, upon the occurrence of any of the following: 
  
 (i) the dissolution and liquidation or final adjudication as bankrupt of, or the filing of a voluntary petition for bankruptcy by the
Company, provided that, should such dissolution and liquidation be for the purpose of restructuring or reorganizing the Company or maintaining their interest in any of its Subsidiaries or Affiliates thereof directly or through a
different Person, the Parties agree to enter into an agreement substantially similar to this Agreement with respect to such new structure, organization or Person as a condition precedent to implementing such restructuring or reorganization or
Person; 
  
 (iii) any of the Parties makes a
general assignment of all or substantially all of its assets for the benefit of its creditors; 
  
 (iv) a change in the Control of the other Party; 
  

(iv) a Party’s Beneficial Ownership in the Company (including such Party’s indirect Beneficial Ownership in the Company
through its Subsidiaries) falls below five per cent (5%) of the Company’s capital stock. 
  
 (b) Notwithstanding the termination of this Agreement, Articles VI and VII shall survive such termination. 
  
 SECTION 7.4 Notices. All notices, requests, demands, waivers and other
communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given if delivered in person or mailed, certified or registered mail with postage prepaid, or sent by facsimile (upon
confirmation of receipt), to the relevant Party at its address listed on the signature page hereto, or to such other Person or address as any Party shall specify by notice in writing to the other Party. All such notices, requests, demands, waivers
and communications shall be deemed to have been received on the date of delivery unless if mailed, in which case on the third Business Day after the mailing thereof, except for a notice of a change of address, which shall be effective only upon
receipt thereof. 
  
 SECTION 7.5 Counterparts. This
Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute a single instrument. 
  
 SECTION 7.6 Entire Agreement. This Agreement sets forth the entire understanding and agreement between the Parties as
to the matters covered herein and supersede and replace any prior understanding, agreement or statement of intent, in each case, written or oral, of any and every nature with respect thereto. In the event of any inconsistency between this Agreement
and the charter documents of the Company, this Agreement shall prevail between the Parties. 
  

 8 

 SECTION 7.7 Waivers and Amendments. No modification of or amendment to this Agreement or waiver of
any provision shall be valid unless in writing signed by an authorized representative of each Party. 
  
 SECTION 7.8 No Third Party Rights; Assignment. This Agreement is intended to be solely for the benefit of the Parties hereto (and their respective
Subsidiaries) and is not intended to confer any benefits upon, or create any rights in favor of, any Person other than the Parties hereto (and their respective Subsidiaries). All rights and obligations hereunder and under any agreements and
documents executed and delivered in connection herewith shall not be assignable without the prior written consent of the other Parties. Any assignment of rights or obligations in violation of this Section 7.8 will be ineffective. 
  
 SECTION 7.9 Specific Performance. The Parties agree that the
obligations imposed on them in this Agreement are special, unique and of an extraordinary character, and that, in the event of breach by any party, damages would not be an adequate remedy and the other Party shall be entitled to specific
performance. 
  
 SECTION 7.10 Further Assurances. From time
to time, at the reasonable request of any Party hereto and without further consideration, each Party hereto shall execute and deliver such additional documents and take all such further action as may be necessary or appropriate to consummate and
make effective, in the most expeditious manner practicable, the transactions contemplated herein. The Parties hereby covenant to take all necessary actions to give effect under the laws of Luxembourg to any provision under this Agreement and any
other action taken with respect hereof. 
  
 SECTION 7.11
Severability. Each Section, subsection and clause of this Agreement constitutes a separate and distinct undertaking, covenant or provision hereof. In the event that any provision of this Agreement shall finally be determined to be unlawful,
such provision shall be deemed severed from this Agreement, but every other provision of this Agreement shall remain in full force and effect. 
  
 SECTION 7.12 Term. Except as otherwise provide herein, this Agreement shall become effective upon the execution and delivery hereof by both Parties
hereto and shall continue in full force and effect until a termination event under Section 7.3 occurs. 
  
 *    *    * 
  

 9 

			
	TENARIS S.A.
		
	By:	 	 /s/ Carlos A. Condorelli

	Name:	 	Carlos A. Condorelli
	Title:	 	Attorney-in-fact
	Date:	 	January 9, 2006
		
	By:	 	 /s/ Roberto Bonatti

	Name:	 	Roberto Bonatti
	Title:	 	Attorney-in-fact
	Date:	 	January 9, 2006
	
	 Address for Notices

	Leandro N. Alem 1067, 28th floor
	C1001AAF Buenos Aires
	Argentina
	Attn:        Carlos Condorelli
	
	 INVERSORA SIDERURGICA LIMITED

		
	By:	 	 /s/ Raúl H. Darderes

	Name:	 	Raúl H. Darderes
	Title:	 	Director
	Date:	 	January 9, 2006
		
	By:	 	 /s/ Umberto Bocchini

	Name:	 	Umberto Bocchini
	Title:	 	Director
	Date:	 	January 9, 2006
	
	 Address for Notices

	Leandro N. Alem 1067, 28th floor
	C1001AAF Buenos Aires
	Argentina
	Attn:        Umberto Bocchini

  

 10

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