EXHIBIT 2(j)
Further Amendments to Definitive Agreements dated as of April 23, 1992, among
EGL Steel Inc., Inland Steel Electrogalvanizing Corporation, Pre Finish
Metals (EG) Incorporated, Bethlehem Steel Corporation, Inland Steel Company,
Inland Steel Industries, Inc., Pre Finish Metals Incorporated and Material
Sciences Corporation
Walbridge Coatings
Dated as of April 23, 1992
EGL Steel Inc. and Inland Steel Electrogalvanizing
Bethlehem Steel Corporation Corporation,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inland Steel Company and
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Inland Steel Industries, Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pre Finish Metals (EG)
Incorporated,
Pre Finish Metals Incorporated and
Material Sciences Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Amendments to Definitive Agreements
-----------------------------------
Gentlemen:
Reference is made to the Partnership Agreement dated as of August 30, 1984
by and among EGL Steel Inc., Inland Steel Electrogalvanizing Corporation and Pre
Finish Metals (EG) Incorporated, as amended, pursuant to which ▇▇▇▇▇▇▇▇▇
Coatings, An Illinois Partnership ("Walbridge Coatings") was formed, and to the
various Definitive Agreements, as amended, referred to therein. All capitalized
terms not defined in this letter agreement shall have the meaning specified in
the Definitive Agreements.
The following amendments are intended to formally document certain matters which
involve provisions of the agreements modified herein. Accordingly, each party to
this agreement hereby agrees to the following amendments with respect to those
agreements identified below to which they are a party:
Appendix A to the Parent Agreement, Partnership Agreement, Construction
-----------------------------------------------------------------------
Agreement, Operating Agreement and Coating Agreements:
------------------------------------------------------
The following definitions are hereby added to Appendix A in proper
alphabetical order:
Dated as of April 23,1992
Page 3
"Purchase Closing" shall mean the date, if any, of the closing of the sale
and transfer of Inland's Walbridge Interests (as such term is defined in
the Transfer Agreement) pursuant to the terms and conditions of the
Transfer Agreement.
"Purchase Percentage" shall mean that percentage of Inland's Walbridge
Interests (as such term is defined in the Transfer Agreement) to be
transferred to and assumed by Bethlehem and/or EGL Steel on the Purchase
Closing under the Transfer Agreement, which shall be 50%, as such
percentage may be reduced pursuant to the terms of the Transfer Agreement.
"Purchaser" shall mean a) with respect to the Inland Coating Agreement,
Inland, and b) with respect to the Bethlehem Coating Agreement, Bethlehem.
"Ramp-up Period" shall mean the period, if any, commencing on the Initial
Production Date (as such term is defined in the Transfer Agreement) and
ending on the Purchase Closing or as otherwise provided in the Transfer
Agreement.
"Transfer Agreement" shall mean the Transfer Agreement dated as of May 29,
1991, among Inland Industries, Inland, Inland EG, Bethlehem and EGL Steel,
as amended by the amendment thereto dated the date hereof (a certified copy
of which has been delivered to PFM on the date hereof, including all
exhibits and other attachments, but not including dollar amounts). All
provisions of the Transfer Agreement referred to in any of the Definitive
Agreements shall be deemed to be a part of such Definitive Agreements and
incorporated therein as though such provisions were set forth verbatim
therein.
The following definitions currently contained in Appendix A are hereby deleted
and replaced with the following:
"Financial Interest" shall mean, with respect to any Partner, such
Partner's percentage financial interest in the Partnership, as set forth
opposite the Partner's name and at the time indicated below:
Prior to the Purchase Closing
-----------------------------
Partner Financial Interest
------- ------------------
EGL Steel 25%
Inland EG 25%
PFM EG 50%
Dated as of April 23,1992
Page 4
On and After the Purchase Closing
---------------------------------
Partner Financial Interest
------- ------------------
EGL Steel 25% plus the
----
product of 25% times
the Purchase Percentage
Inland EG 25% minus the
-----
product of 25% times
the Purchase Percentage
PFM EG 50%
"Voting Interest" shall mean, with respect to any Partner, such Partner's
percentage voting interest in the Partnership, as set forth opposite the
Partner's name and at the time indicated below:
Prior to the Purchase Closing
-----------------------------
Partner Voting Interest
------- ---------------
EGL Steel 26%
Inland EG 26%
PFM EG 48%
Dated as of April 23,1992
Page 5
On or After the Purchase Closing
--------------------------------
Partner Voting Interest
------- ---------------
EGL Steel 26% plus the
----
product of 26% times
the Purchase Percentage
Inland EG 26% minus the
product of 26% times
the Purchase Percentage
PFM EG 48%
Partnership Agreement:
---------------------
Section 7.1, Annual Meeting of Partners, is hereby amended by adding the
--------------------------
following parenthetical after the words "two individuals" in the second sentence
of such Section:
"(or a fewer or greater number as provided in Section 8.1 hereof)"
Section 8.1, Members, is hereby amended by adding the following at the end
-------
of such Section:
"After the Purchase Closing, if, for any reason, Inland EG relinquishes, in
its sole and absolute discretion, one of its two positions on the
Management Committee, EGL Steel shall be entitled to appoint one additional
member to the Management Committee, provided, however, that no such
-------- -------
relinquishment or appointment shall affect or change the voting procedures
set forth in Section 8.2 hereof."
Section 13.2, Permissible Transfers, is hereby amended by adding the
---------------------
following at the end of such Section:
"(c) in connection with the Transfer Agreement.
As of the Purchase Closing, a portion equal to the Purchase Percentage
of all of Inland's, Inland EG's and Inland Industries' (if any) interests
in Walbridge and in and under the Definitive Agreements, as amended,
including, without limitation, Inland's and Inland EG's Partner's Interest,
Financial Interest, Voting Interest, rights to Production Time and residual
equity interest (if any), shall be transferred to EGL Steel and/or
Bethlehem and all
Dated as of April 23,1992
Page 6
rights, liabilities and obligations corresponding thereto and arising
thereafter in the Partnership and under the Definitive Agreements shall be
transferred to and assumed by EGL Steel and/or Bethlehem, all in accordance
with the Transfer Agreement; provided, however, that the documents to
-----------------
effect such transfer and assumption (without dollar amounts) shall be
reasonably satisfactory to counsel for MSC, PFM and PFM EG. Payment
obligations for any payment period and any other calculations with respect
to a period of time which includes the Purchase Closing shall be calculated
pro-rata in proportion to the respective interests of Inland EG and EGL
Steel in the Partnership and under the Partnership Agreement before as
compared with on and after the Purchase Closing. During the Ramp-up Period,
certain percentages of Inland's rights to Production Time shall be assigned
to Bethlehem and certain rights and payment obligations corresponding
thereto shall be assumed by Bethlehem in accordance with the Transfer
Agreement. During the Ramp-up Period, Production Time assigned to Bethlehem
shall be reassigned to Inland upon the occurrence of certain events
specified in the Transfer Agreement and payment obligations corresponding
thereto shall be allocated pro rata between Inland and Bethlehem for the
month of reassignment in accordance with the Transfer Agreement."
Coating Agreement dated October 15. 1984 between Inland Steel Company and
-------------------------------------------------------------------------
Walbridge Coatings. An Illinois Partnership:
-------------------------------------------
The first sentence of Section 3.2, Reserved Production Time, is hereby
------------------------
amended by deleting the reference to "one-half" and substituting therefor:
"(a) until the commencement of the Ramp-up Period, one-half, (b) during the
Ramp-up Period, one-half minus the product of fifty percent times the
-----
percentage of the Purchaser's rights to Production Time to which the other
Primary Purchaser is entitled to pursuant to the Transfer Agreement, and
(c) on and after the Purchase Closing, one-half minus the product of fifty
-----
percent times the Purchase Percentage,".
The third sentence of clause (a) of Section 4.3, Fixed Cost Advances, which
-------------------
was added to Section 4.3 by the Further Amendments to Definitive Agreements
dated as of July 24, 1986, is hereby amended by deleting the words "twenty-five
percent (25%)" and substituting the following:
"(i) until the commencement of the Ramp-up Period, twenty-five
percent, (ii) during the Ramp-up Period, twenty-five percent minus the
-----
product of twenty-five percent times the percentage of the other Primary
Purchaser's rights to Production Time to which the Purchaser is entitled
pursuant to the Transfer Agreement (regardless of whether the Purchaser
used any or all of such Production Time), and
Dated as of April 23,1992
Page 7
(iii) on and after the Purchase Closing, twenty-five percent minus the
-----
product of twenty-five percent times the Purchase Percentage,"
Section 5.1(a), Scheduling of Production Time, is hereby amended by adding
-----------------------------
the following at the end thereof:
"Purchaser shall be required to reduce its Production Forecasts by or
otherwise reflect therein the transfer of the amounts of any Production
Time to which the other Primary Purchaser has or will become entitled
pursuant to the Transfer Agreement during the Forecast Period."
Paragraph (a) of Section 5.2, Production Priorities, is hereby deleted and
---------------------
replaced with the following:
"(a) In scheduling available Production Time for EG Services during
each month, the Partnership shall give priority to purchase orders of
Purchaser for EG Services up to the amount of Production Time for EG
Services set forth in the timely Firm Order of Purchaser, for such month,
provided that (a) Purchaser's right of priority for EG Services shall be
limited to (x) until the commencement of the Ramp-up Period, one-half, (y)
during the Ramp-up Period, one-half minus the product of fifty percent
-----
times the percentage of the Purchaser's rights to Production Time to which
the other Primary Purchaser is entitled pursuant to the Transfer Agreement,
and (z) on and after the Purchase Closing, one-half minus the product of
-----
fifty percent times the Purchase Percentage, of all available Production
Time during such month and (b) Purchaser shall have a right of first
refusal for additional EG Services for all or part of the available
Production Time not reserved by the timely Firm Order for EG Services of
the other Primary Purchaser under its Coating Agreement. To the extent that
the Firm Orders of the Primary Purchasers for EG Product do not exceed the
available Production Time of the EG Facility, operator shall give priority
to purchase orders of Purchaser for Z Services up to the amount of
Production Time for Z Services set forth in the timely Firm Order of
Purchaser for such month, provided that (i) Purchaser's right of priority
for EG Services and Z Services in the aggregate shall be limited to (x)
until the commencement of the Ramp-up Period, one-half, (y) during the
Ramp-up Period, one-half minus the product of fifty percent times the
-----
percentage of the Purchaser's rights to Production Time to which the other
Primary Purchaser is entitled pursuant to the Transfer Agreement, and (z)
on and after the Purchase Closing, one-half minus the product of fifty
-----
percent times the Purchase Percentage, of all available Production Time
during such month and (ii) Purchaser shall have a right of first refusal
for additional Z Services for all or part of the
Dated as of April 23,1992
Page 8
available Production Time not reserved by the timely Firm Order for Z
Services of the other Primary Purchaser under its Coating Agreement. Such
rights of first refusal shall be exercisable by Purchaser by giving notice
to the Partnership not less than five days after receipt of the Production
Forecast of the other Primary Purchaser for such month. Each such right of
first refusal shall expire upon the expiration of such five-day period.
Purchaser acknowledges that the Coating Agreement with the other Primary
Purchaser contains similar rights of first refusal for the benefit of the
other Primary Purchaser with respect to available Production Time not
reserved by the timely Firm Order of Purchaser."
The first sentences of Section 5.3, Reduced Production and Yield Loss
---------------------------------
Rebates, and of Section 5.4, Rebates of Unabsorbed Costs, are hereby amended by
------- ---------------------------
deleting the words "one-half of such amount to each of them" and substituting
the following:
"(a) in connection with periods prior to the commencement of the Ramp-up
Period, one-half of such amount to each of them, (b) in connection with
periods during the Ramp-up Period, one-half minus the product of fifty
-----
percent times the percentage of the Purchaser's rights to Production Time
to which the other Primary Purchaser is entitled pursuant to the Transfer
Agreement to the Purchaser, and one-half minus the product of fifty percent
-----
times the percentage of the Purchaser's rights to Production Time to which
the other Primary Purchaser is entitled pursuant to the Transfer Agreement
to the other Primary Purchaser (in each case regardless of whether the
other Primary Purchaser uses any or all of such Production Time), and (c)
in connection with periods on and after the Purchase Closing, one-half
minus the product of fifty percent times the Purchase Percentage to the
-----
Purchaser and one-half plus the product of fifty percent times the Purchase
----
Percentage to the other Primary Purchaser."
The first sentence of Section 6.2, EG Fixed Portion, is hereby deleted and
----------------
replaced with the following:
"The Fixed Portion of the Coating Fee shall be (a) until the commencement
of the Ramp-up Period, fifty percent, (b) during the Ramp-up Period, fifty
percent minus the Product of fifty percent times the percentage of the
-----
Purchaser's rights to Production Time to which the other Primary Purchaser
is entitled pursuant to the Transfer Agreement (regardless of whether the
other Primary Purchaser uses any or all of such Production Time), and (c)
on and after the Purchase Closing, fifty percent minus the product of fifty
-----
percent times the Purchase Percentage, of the Fixed Portion of the
Operator's Fee provided in Section 6.2 of the Operating Agreement
-----------
Dated as of April 23,1992
Page 9
(including without limitation any adjustments thereto pursuant to Section
-------
6.5 of the Operating Agreement). The Fixed Portion of the Coating Fee shall
---
be payable to the Partnership by Purchaser monthly on or before the last
business day of each calendar month in such a manner that the payment funds
are available to the Partnership not later than the end of such month."
The second sentence of Section 6.2, EG Fixed Portion, is hereby amended by
----------------
deleting the reference to "Section 6.2(b)(i) of the Operating Agreement" and
-----------------
substituting therefor "Section 6.2(b) of the Operating Agreement."
--------------
The last sentences of Section 6.2, EG Fixed Portion, and of Section 6.9,
----------------
Fixed Financing Costs Payments, which were added to Sections 6.2 and 6.9 by the
--------------------------------
Further Amendments to Definitive Agreements dated as of July 24, 1986, are
hereby amended by deleting the words "twenty-five percent (25%)" and
substituting the following:
"(a) until the commencement of the Ramp-up Period, twenty-five
percent, (b) during the Ramp-up Period, twenty-five percent minus the
-----
product of twenty-five percent times the percentage of the Purchaser's
rights to Production Time to which the other Primary Purchaser is entitled
pursuant to the Transfer Agreement (regard less of whether the other
Primary Purchaser uses any or all of such Production Time), and (c) on and
after the Purchase Closing, twenty-five percent minus the product of
-----
twenty-five percent times the Purchase Percentage,"
The first sentence of Section 6.9, Fixed Financing Costs Payments, is
------------------------------
hereby deleted and replaced with the following:
"During each Reporting Period of each Financing Costs Payment Period,
Purchaser shall pay to the Partnership a sum (the "Fixed Financing Costs
Payment") equal to (a) until the commencement of the Ramp-up Period,
twenty-five percent, (b) during the Ramp-up Period, twenty-five percent
minus the product of twenty-five percent times the percentage of the
-----
Purchaser's rights to Production Time to which the other Primary Purchaser
is entitled pursuant to the Transfer Agreement (regardless of whether the
other Primary Purchaser uses any or all of such Production Time), and (c)
on and after the Purchase Closing, twenty five percent minus the product of
twenty-five percent times the Purchase Percentage, of the Financing Costs
incurred by the Partnership for the particular Financing Costs Payment
Period under the Permanent Financing Agreement multiplied by the number of
days during such Reporting Period and divided by the number of days between
the date of the
Dated as of April 23,1992
Page 10
immediately preceding payment of Permanent Financing and the due date of
the next forthcoming payment of Permanent Financing."
Clause (A) of Section 6.10, Per Ton Financing Costs Payments, is hereby
--------------------------------
amended by deleting the reference to "fifty percent" and substituting therefor:
"(x) until the commencement of the Ramp-up Period, fifty percent, (y)
during the Ramp-up Period, fifty percent minus the product of fifty percent
-----
times the percentage of the Purchaser's rights to Production Time to which
the other Primary Purchaser is entitled pursuant to the Transfer Agreement
(regardless of whether the other Primary Purchaser uses any or all of such
Production Time), and (z) on and after the Purchase Closing, fifty percent
minus the product of fifty percent times the Purchase Percentage,"
-----
Section 7.7, Assignment, is hereby amended by adding the following at the
----------
end thereof:
"As of the Purchase Closing a portion equal to the Purchase Percentage of
Inland's right to Production Time under this Agreement shall be transferred
to Bethlehem and all rights, liabilities and obligations corresponding
thereto and arising thereafter in the Partnership and under this Agreement
shall be transferred to and assumed by Bethlehem. Payment obligations for
any payment period and any other calculations with respect to a period of
time which includes the Purchase Closing shall be calculated pro-rata in
proportion to the respective interests of Inland and Bethlehem under this
Agreement before as compared with on and after the Purchase Closing. During
the Ramp-up Period, certain percentages of Inland's rights to Production
Time shall be assigned to Bethlehem and certain rights and payment
obligations corresponding thereto shall be assumed by Bethlehem in
accordance with the Transfer Agreement. During the Ramp-up Period,
Production Time assigned to Bethlehem shall be reassigned to Inland upon
the occurrence of certain events specified in the Transfer Agreement and
payment obligations corresponding thereto shall be assumed by Inland. If
such reassignment occurs on other than the first day of any month, payment
obligations corresponding to reassigned Production Time shall be allocated
pro rata between Inland and Bethlehem for the month of reassignment in
accordance with the Transfer Agreement. Inland and Bethlehem shall promptly
notify the Partnership of any assignment or reassignment of Production Time
and any payment obligations to be assumed by Bethlehem and/or Inland
corresponding thereto."
Dated as of April 23,1992
Page 11
Coating Agreement dated October 15, 1984 between Bethlehem Steel Corporation and
--------------------------------------------------------------------------------
▇▇▇▇▇▇▇▇▇ Coatings, An Illinois Partnership:
-------------------------------------------
The first sentence of Section 3.2, Reserved Production Time, is hereby
--------------------------
amended by deleting the reference to "one-half" and substituting therefor:
"(a) until the commencement of the Ramp-up Period, one-half, (b) during the
Ramp-up Period, one-half plus the product of fifty percent times the
----
percentage of the other Primary Purchaser's rights to Production Time to
which the Purchaser is entitled pursuant to the Transfer Agreement, and (c)
on and after the Purchase Closing, one-half plus the product of fifty
----
percent times the Purchase Percentage,".
The third sentence of clause (a) of Section 4.3, Fixed Cost Advances, which
-------------------
was added to Section 4.3 by the Further Amendments to Definitive Agreements
dated as of July 24, 1986, is hereby amended by deleting the words "twenty-five
percent (25%)" and substituting the following:
"(i) until the commencement of the Ramp-up Period, twenty-five
percent, (ii) during the Ramp-up Period, twenty-five percent plus the
----
product of twenty-five percent times the percentage of the other Primary
Purchaser's rights to Production Time to which the Purchaser is entitled
pursuant to the Transfer Agreement (regardless of whether the Purchaser
used any or all of such Production Time), and (iii) on and after the
Purchase Closing, twenty-five percent Plus the product of twenty-five
----
percent times the Purchase Percentage,"
Section 5.1(a), Scheduling of Production Time, is hereby amended by adding
-----------------------------
the following at the end thereof:
"Purchaser shall be entitled, but shall not be required, to include in its
Production Forecasts any Production Time requirements to which it has or
will become entitled pursuant to the Transfer Agreement during the Forecast
Period."
Paragraph (a) of Section 5.2, Production Priorities, is hereby deleted and
---------------------
replaced with the following:
"(a) In scheduling available Production Time for EG services during each
month, the Partnership shall give priority to purchase orders of Purchaser
for EG Services up to the amount of Production Time for EG Services set
forth in the timely Firm Order of Purchaser for such month, provided that
(a) Purchaser's right of priority for EG Services shall be limited to (x)
until the commencement of the Ramp-up Period, one-half, (y) during the
Ramp-up Period, one-half plus the product of fifty percent
----
Dated as of April 23,1992
Page 12
times the percentage of the other Primary Purchaser's rights to Production
Time to which the Purchaser is entitled pursuant to the Transfer Agreement,
and (z) on and after the Purchase Closing, one-half plus the product of
----
fifty percent times the Purchase Percentage, of all available Production
Time during such month and (b) Purchaser shall have a right of first
refusal for additional EG Services for all or part of the available
Production Time not reserved by the timely Firm Order for EG Services of
the other Primary Purchaser under its Coating Agreement. To the extent that
the Firm Orders of the Primary Purchasers for EG Product do not exceed the
available Production Time of the EG Facility, Operator shall give priority
to purchase orders of Purchaser for Z Services up to the amount of
Production Time for Z Services set forth in the timely Firm Order of
Purchaser for such month, provided that (i) Purchaser's right of priority
for EG Services and Z Services in the aggregate shall be limited to (x)
until the commencement of the Ramp-up Period, one-half, (y) during the
Ramp-up Period, one-half Plus the product of fifty percent times the
----
percentage of the other Primary Purchaser's rights to Production Time to
which the Purchaser is entitled pursuant to the Transfer Agreement, and (z)
on and after the Purchase Closing, one-half plus the product of fifty
----
percent times the Purchase Percentage, of all available Production Time
during such month and (ii) Purchaser shall have a right of first refusal
for additional Z Services for all or part of the available Production Time
not reserved by the timely Firm Order for Z Services of the other Primary
Purchaser under its Coating Agreement. Such rights of first refusal shall
be exercisable by Purchaser by giving notice to the Partnership not less
than five days after receipt of the Production Forecast of the other
Primary Purchaser for such month. Each such right of first refusal shall
expire upon the expiration of such five-day period. Purchaser acknowledges
that the Coating Agreement with the other Primary Purchaser contains
similar rights of first refusal for the benefit of the other Primary
Purchaser with respect to available Production Time not reserved by the
timely Firm Order of Purchaser."
The first sentences of Section 5.3, Reduced Production and Yield Loss
---------------------------------
Rebates, and of Section 5.4, Rebates of Unabsorbed Costs, are hereby amended by
------- ---------------------------
deleting the words "one-half of such amount to each of them" and substituting
the following:
"(a) in connection with periods prior to the commencement of the Ramp-up
Period, one-half of such amount to each of them, (b) in connection with
periods during the Ramp-up Period, one-half Plus the product of fifty
----
percent times the percentage of the other Primary Purchaser's rights to
Production Time to which the Purchaser is entitled pursuant to the Transfer
Agreement to the Purchaser and one-half minus the product of fifty percent
-----
times the percentage of the other Primary Purchaser's rights
Dated as of April 23, 1992
Page 13
to Production Time to which the Purchaser is entitled pursuant to the
Transfer Agree ment to the other Primary Purchaser (in each case regardless
of whether the Purchaser uses any or all of such Production Time), and (c)
in connection with periods on and after the Purchase Closing, one-half plus
----
the product of fifty percent times the Purchase Percentage to the Purchaser
and one-half minus the product of fifty percent times the Purchase
-----
Percentage to the other Primary Purchaser."
The first sentence of Section 6.2, EG Fixed Portion, is hereby deleted and
----------------
replaced with the following:
"The Fixed Portion of the Coating Fee shall be (a) until the commencement
of the Ramp-up Period, fifty percent, (b) during the Ramp-up Period, fifty
percent plus the product of fifty percent times the percentage of the other
----
Primary Purchaser's rights to Production Time to which the Purchaser is
entitled pursuant to the Transfer Agreement (regardless of whether the
Purchaser uses any or all of such Production Time), and (c) on and after
the Purchase Closing, fifty percent plus the product of fifty percent times
the Purchase Percentage, of the Fixed Portion of the operator's Fee
provided in Section 6.2 of the Operating Agreement (including without
-----------
limitation any adjustments thereto pursuant to Section 6.5 of the Operating
-----------
Agreement). The Fixed Portion of the Coating Fee shall be payable to the
Partnership by Purchaser monthly on or before the last business day of each
calendar month, in such a manner that the payment funds are available to
the Partnership not later than the end of such month."
The second sentence of Section 6.2, EG Fixed Portion, is hereby amended by
----------------
deleting the reference to "Section 6.2(b)(i) of the Operating Agreement" and
------------------
substituting therefor "Section 6.2(b) of the Operating Agreement."
--------------
The last sentences of Section 6.2, EG Fixed Portion, and of Section 6.9,
-----------------
Fixed Financing Costs Payments, which were added to Sections 6.2 and 6.9 by the
------------------------------
Further Amendments to Definitive Agreements dated as of July 24, 1986, are
hereby amended by deleting the words "twenty-five percent (25%)" and
substituting the following:
"(a) until the commencement of the Ramp-up Period, twenty-five percent, (b)
during the Ramp-up Period, twenty-five percent plus the product of twenty-
----
five percent times the percentage of the other Primary Purchaser's rights
to Production Time to which the Purchaser is entitled pursuant to the
Transfer Agreement (regardless of whether the Purchaser used any or all of
such Production Time), and (c) on and after
Dated as of April 23, 1992
Page 14
the Purchase Closing, twenty-five percent Plus the product of twenty-five
----
percent times the Purchase Percentage,"
The first sentence of Section 6.9, Fixed Financing Costs Payments, is
------------------------------
hereby deleted and replaced with the following:
"During each Reporting Period of each Financing Costs Payment Period,
Purchaser shall pay to the Partnership a sum (the "Fixed Financing Costs
Payment") equal to (a) until the commencement of the Ramp-up Period,
twenty-five percent, (b) during the Ramp-up Period, twenty-five percent
plus the product of twenty-five percent times the percentage of the other
----
Primary Purchaser's rights to Production Time to which the Purchaser, is
entitled pursuant to the Transfer Agreement (regardless of whether the
Purchaser uses any or all of such Production Time), and (c) on and after
the Purchase Closing, twenty-five percent plus the product of twenty-five
----
percent times the Purchase Percentage, of the Financing Costs incurred by
the Partnership for the particular Financing Costs Payment Period under the
Permanent Financing Agreement multiplied by the number of days during such
Reporting Period and divided by the number of days between the date of the
immediately preceding payment of Permanent Financing and the due date of
the next forthcoming payment of Permanent Financing."
Clause (A) of Section 6.10, Per Ton Financing Costs Payments, is hereby
--------------------------------
amended by deleting the reference to "fifty percent" and substituting therefor:
"(x) until the commencement of the Ramp-up Period, fifty percent, (y)
during the Ramp-up Period, fifty percent plus the product of fifty percent
----
times the percentage of the other Primary Purchaser's rights to Production
Time to which the Purchaser is entitled pursuant to the Transfer Agreement
(regardless of whether the Purchaser uses any or all of such Production
Time), and (z) on and after the Purchase Closing, fifty percent plus the
----
product of fifty percent times the Purchase Percentage,".
Section 7.7, Assignment, is hereby amended by adding the following at the
----------
end thereof:
"As of the Purchase Closing a portion equal to the Purchase Percentage of
Inland's right to Production Time arising under the Coating Agreement dated
the date hereof between Inland and the Partnership shall be transferred to
Bethlehem and all rights, liabilities and obligations corresponding thereto
and arising thereafter in the Partnership and under such Coating Agreement
shall be transferred to' and assumed by Bethlehem. Payment obligations for
any payment period and any other
Dated as of April 23, 1992
Page 15
calculations with respect to a period of time which includes the Purchase
Closing shall be calculated pro-rata in proportion to the respective
interests of Inland and Bethlehem under such Coating Agreement before as
compared with on and after the Purchase Closing. During the Ramp-up Period,
certain percentages of Inland's rights to Production Time shall be assigned
to Bethlehem and certain rights and payment obligations corresponding
thereto shall be assumed by Bethlehem in accordance with the Transfer
Agreement. During the Ramp-up Period, Production Time assigned to Bethlehem
shall be reassigned to Inland upon the occurrence of certain events
specified in the Transfer Agreement and payment obligations corresponding
thereto shall be assumed by Inland. If such reassignment occurs on other
than the first day of any month, payment obligations corresponding to
reassigned Production Time shall be allocated pro rata between Inland and
Bethlehem for the month of reassignment in accordance with the Transfer
Agreement. Inland and Bethlehem shall promptly notify the Partnership of
any assignment or reassignment of Production Time and any payment
obligations to be assumed by Bethlehem and/or Inland corresponding
thereto."
Operating Agreement:
-------------------
Section 11.7, Assignment, is amended by adding the following at the end
----------
thereof:
"As of the Purchase Closing a portion equal to the Purchase Percentage of
Inland's, Inland EG's and Inland Industries' (if any) rights, liabilities
and obligations arising thereafter in the Partnership and under this
Agreement shall be transferred to and assumed by Bethlehem and EGL Steel.
If the Purchase Closing occurs on other than the first day of any month,
payment obligations corresponding to Production Time assigned pursuant to
the Purchase Closing shall be allocated pro rata between Inland and
Bethlehem in accordance with the number of days Inland and Bethlehem are
entitled to such Production Time during the month in which such Purchase
Closing occurs. Payment obligations for any period and any other
calculations with respect to a period of time which includes the Purchase
Closing shall be calculated pro-rata in proportion to the respective
interests of the Inland parties and the Bethlehem parties under this
Agreement before as compared with on and after the Purchase Closing. During
the Ramp-up Period, certain percentages of Inland's rights to Production
Time shall be assigned to Bethlehem and certain rights and payment
obligations corresponding thereto shall be assumed by Bethlehem in
accordance with the Transfer Agreement. During the Ramp-up Period,
Production Time assigned to Bethlehem shall be reassigned to Inland upon
the occurrence of certain events specified in the Transfer Agreement and
payment obligations corresponding thereto
Dated as of April 23, 1992
Page 16
shall be assumed by Inland. If such reassignment occurs on other than the
first day of any month, payment obligations corresponding to reassigned
Production Time shall be allocated pro rata between Inland and Bethlehem
for the month of reassignment in accordance with the Transfer Agreement.
Upon notification by Bethlehem and Inland of any assignment or reassignment
of Production Time, the Partnership shall promptly notify PFM EG of such
assignment or reassignment and any payment obligations to be assumed by
Bethlehem and/or Inland corresponding thereto."
Section 7.3(c), Allocation of Remaining Revenues, is hereby amended by
--------------------------------
adding the following at the end thereof:
"in connection with periods prior to the Ramp-up Period or after Purchase
Closing, and in proportion to their respective rights to Production Time
during the Ramp-up Period."
Exhibit 4, Items Included in Fixed Portion of Operator's Fee, is hereby
-------------------------------------------------
amended by adding the following at the end thereof:
"(iii) those extraordinary shutdown fees or such other fees or costs which
in each case have been or are unanimously approved in writing by the
Management Committee to be included in the Fixed Portion of the Operator's
Fee."
Exhibit 5, Items Included in Variable Portion of Operator's Fee, is hereby
----------------------------------------------------
amended by adding the following at the end thereof:
"(ix) those surcharges or other fees or costs which in each case have been
or are unanimously approved in writing by the Management Committee to be
included in the Variable Portion Fee per Ton of EG Product."
In order to clarify the grammar of the first clause of section (a) of
Exhibit 6, Productivity and Quality Standards, and without implying any
----------------------------------
substantive change to such clause, section or Exhibit, or any effect upon prior
waivers of or amendments to such clause, section or Exhibit, such clause is
hereby deleted and replaced with the following restatement:
"(a) The Partnership shall cause the Primary Purchasers to order EG
Services and Z Services in a reasonably level manner so that excessive
productivity demands will not be placed on Operator's operation of the EG
Facility during any unit of time. To the extent that any purchase orders
from Primary Purchasers for EG Services to be
Dated as of April 23, 1992
Page 17
rendered during any unit of time, converted to Standard Tons, exceed the
number of Tons of Reference Strip included in the Design Capacity of the EG
Facility for such unit of time, divided by 965, such Purchase Orders shall
be disregarded for purposes of this Exhibit 6. Subject to the foregoing and
---------
to Paragraph (d) of this Exhibit 6, if during the Normal Operations
------------- ---------
Period:"
All other terms and conditions of the Definitive Agreements not amended
hereby shall remain in full force and effect.
Anything in these Amendments to Definitive Agreements to the contrary
notwithstanding, Inland shall continue to pay the part of the Fixed Portion of
the Coating Fee and Fixed Financing costs Payments which shall have been the
responsibility of Bethlehem and EGL Steel as a result of any assignment of
Production Time to Bethlehem and EGL Steel under Section 3.1 of the Transfer
Agreement for all periods until the earlier of the date of the Purchase Closing
or the date of the return of such Production Time to Inland pursuant to Section
6.1 of the Transfer Agreement or otherwise, provided, however, that Bethlehem
-------- -------
and EGL steel shall reimburse Inland on the earlier of such dates for all
amounts which are the responsibility of Bethlehem and EGL Steel under Section
3.1 or Section 6.1 of the Transfer Agreement but which shall have been paid by
Inland in accordance with this sentence. Anything in these Amendments to
Definitive Agreements to the contrary notwithstanding, except as provided below,
all of these Amendments to Definitive Agreements shall become null and void in
the event that the Inland Production Time which was theretofore assigned to
Bethlehem and EGL Steel under Section 3.1 of the Transfer Agreement shall be
returned to Inland in accordance with Section 6.1 of the Transfer Agreement or
otherwise; provided, further, that these Amendments to Definitive Agreements
-----------------
shall be automatically reinstated in the event that Bethlehem and EGL Steel
shall require a Purchase Closing to occur under Section 6.2 of the Transfer
Agree ment. Bethlehem and EGL Steel shall, however, remain liable for payment
of the Fixed Portion of the Coating Fee and Fixed Financing Costs Payments in
accordance with the first sentence of this paragraph and, with respect to
Production Time actually used by Bethlehem and EGL Steel, the Variable Portions
of the Coating Fee and Per Ton Financing Cost Payments of Production Time, which
had been assigned to Bethlehem and EGL Steel under the Transfer Agreement,
through the date of the return of any such Production Time to Inland; provided
--------
that to the extent Production Time is reassigned to Inland pursuant to the terms
of Section 6.1 on other than the first day of any month, the Fixed Portion of
the Coating Fee and Fixed Financing Costs Payments associated with such
reassigned Production Time shall be allocated pro rata between Inland and
--- ----
Bethlehem and EGL Steel in accordance with the number of days Inland and
Bethlehem are entitled to such reassigned Production Time during the month in
which such reassignment of Production Time occurred.
Bethlehem, EGL Steel, Inland Industries, Inland and Inland EG agree that
the differences between these Amendments to Definitive Agreements and the form
of such amendments attached
Dated as of April 23, 1992
Page 18
as Exhibit F to the Transfer Agreement are all "non-material changes" necessary
to consummate the transactions contemplated by the Transfer Agreement for
purposes of Sections 8.2 and 8.3 of the Transfer Agreement.
Dated as of April 23, 1992
Page 19
In order to evidence such amendments, please sign two counterpart copies of
this letter at the location indicated below, and return such counterparts to the
Walbridge headquarters offices.
Very truly yours,
▇▇▇▇▇▇▇▇▇ COATINGS, AN
ILLINOIS PARTNERSHIP
By: PRE FINISH METALS (EG)
INCORPORATED
General Partner
By:_______________________________
By: EGL STEEL INC.
General Partner
By:_______________________________
By: INLAND STEEL ELECTROGALVANIZING
CORPORATION
General Partner
By:_______________________________
Dated as of April 23, 1992
Page 18
In order to evidence such amendments, please sign two counterpart copies of
this letter at the location indicated below, and return such counterparts to the
Walbridge headquarters offices.
Very truly yours,
▇▇▇▇▇▇▇▇▇ COATINGS, AN
ILLINOIS PARTNERSHIP
By: PRE FINISH METALS (EG)
INCORPORATED
General Partner
By:_______________________________
By: EGL STEEL INC.
General Partner
By:_______________________________
By: INLAND STEEL ELECTROGALVANIZING
CORPORATION
General Partner
By:_______________________________
Dated as of April 23, 1992
Page 18
In order to evidence such amendments, please sign two counterpart copies of
this letter at the location indicated below, and return such counterparts to the
Walbridge headquarters offices.
Very truly yours,
▇▇▇▇▇▇▇▇▇ COATINGS, AN
ILLINOIS PARTNERSHIP
By: PRE FINISH METALS (EG)
INCORPORATED
General Partner
By:_______________________________
By: EGL STEEL INC.
General Partner
By:_______________________________
By: INLAND STEEL ELECTROGALVANIZING
CORPORATION
General Partner
By:_______________________________
Dated as of April 23, 1992
Page 19
Agreed as of the 23/rd/ day
of April, 1992.
EGL STEEL INC.
By:_______________________________
BETHLEHEM STEEL CORPORATION
By:_______________________________
INLAND STEEL ELECTROGALVANIZING
CORPORATION
By:_______________________________
INLAND STEEL COMPANY
By:_______________________________
INLAND STEEL INDUSTRIES, INC.
By:_______________________________
PRE FINISH METALS (EG) INCORPORATED
By:_______________________________
PRE FINISH METALS INCORPORATED
By:_______________________________
MATERIAL SCIENCES CORPORATION
By:_______________________________
Dated as of April 23, 1992
Page 19
Agreed as of the 23/rd/ day
of April, 1992.
EGL STEEL INC.
By:_______________________________
BETHLEHEM STEEL CORPORATION
By:_______________________________
INLAND STEEL ELECTROGALVANIZING
CORPORATION
By:_______________________________
INLAND STEEL COMPANY
By:_______________________________
INLAND STEEL INDUSTRIES, INC.
By:_______________________________
PRE FINISH METALS (EG) INCORPORATED
By:_______________________________
PRE FINISH METALS INCORPORATED
By:_______________________________
MATERIAL SCIENCES CORPORATION
By:_______________________________
Dated as of April 23, 1992
Page 19
Agreed as of the 23/rd/ day
of April, 1992.
EGL STEEL INC.
By:_______________________________
BETHLEHEM STEEL CORPORATION
By:_______________________________
INLAND STEEL ELECTROGALVANIZING
CORPORATION
By:_______________________________
INLAND STEEL COMPANY
By:_______________________________
INLAND STEEL INDUSTRIES, INC.
By:_______________________________
PRE FINISH METALS (EG) INCORPORATED
By:_______________________________
PRE FINISH METALS INCORPORATED
By:_______________________________
MATERIAL SCIENCES CORPORATION
By:_______________________________
