10-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For fiscal year ended December 31, 2002

Commission file number 1-4119

NUCOR CORPORATION

(Exact name of Registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization)

13-1860817
(I.R.S. employer
identification no.)

2100 Rexford Road, Charlotte, North Carolina
(Address of principal executive offices)
28211
(Zip code)

Registrant’s telephone number, including area code: (704) 366-7000

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Common stock, par value $.40 per share
Name of each exchange
on which registered
New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:
None

Indication by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months, and (2) has been subject to such filing requirements for the past 90 days: Yes x No o

Indication by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K: _____

Indicate by check mark whether the Registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2):Yes x No o

Aggregate market value of common stock held by non-affiliates was $ 5,054,773,192 based upon the closing sales price of the Registrant’s common stock on June 28, 2002.

78,182,838 shares of common stock were outstanding at February 28, 2003.

Documents incorporated by reference include: Portions of 2002 Annual Report (Parts I, II, and IV), and Proxy Statement for the Annual Meeting of Stockholders to be held on May 8, 2003 (Parts II and III).

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PART I

Item 1.Business

Nucor Corporation was incorporated in Delaware in 1958. The business of Nucor Corporation and its subsidiaries is the manufacture and sale of steel and steel products, which accounted for all of the sales and the majority of the earnings in 2002 and 2001, and all of the sales and earnings in 2000. The earnings in 2002 include a pre-tax gain of $29,900,000 related to a graphite electrodes anti-trust settlement. The earnings of 2001 include a pre-tax gain of $20,200,000 from the sale of Nucor Iron Carbide, Inc. in Trinidad.

Nucor reports its results in two segments, steel mills and steel products. Net sales to external customers, intercompany sales, depreciation expense, earnings before income taxes, assets and capital expenditures by segment for each of the three years in the period ended December 31, 2002, are set forth in Note 14 of Notes to Consolidated Financial Statements of the 2002 Annual Report, which note is hereby incorporated by reference.

Principal products from the steel mills segment are hot-rolled steel (angles, rounds, flats, channels, sheet, wide-flange beams, pilings, billets, blooms, beam blanks and plate) and cold-rolled steel. Principal products from the steel products segment are steel joists and joist girders, steel deck, cold finished steel, steel fasteners, metal building systems and light gauge steel framing. Hot-rolled steel is manufactured principally from scrap, utilizing electric arc furnaces, continuous casting and automated rolling mills. Cold-rolled steel, cold finished steel, steel joists and joist girders, and steel fasteners are manufactured by further processing of hot-rolled steel. Steel deck is manufactured from cold-rolled steel.

In the steel mills segment, hot-rolled and cold-rolled sheet steel are produced to customer orders. In addition, other hot-rolled and cold-rolled steel are manufactured in standard sizes and inventories are maintained. In 2002, approximately 90% of the steel mills segment production was sold to non-affiliated customers; the remainder was used internally by the steel products segment. Hot-rolled steel and cold-rolled steel are sold primarily to steel service centers, fabricators and manufacturers throughout the United States.

In the steel products segment, steel joists and joist girders, and steel deck are sold to general contractors and fabricators throughout the United States. Substantially all work is to order and no unsold inventories of finished products are maintained. All sales contracts are firm fixed-price contracts and are normally competitively bid against other suppliers. Cold finished steel and steel fasteners are manufactured in standard sizes and inventories are maintained. Cold finished steel and steel fasteners are sold primarily to distributors and manufacturers throughout the United States.

The primary raw material for the steel mills segment is ferrous scrap, which is acquired from numerous sources throughout the country. The steel mills are large consumers of electricity and gas. Nucor sometimes uses natural gas purchase contracts to partially manage its exposure to price risk of natural gas that is used during the manufacturing process. The primary raw material for the steel products segment is steel, which is primarily purchased from the steel mills segment. Supplies of raw materials and energy have been, and are expected to be, adequate to operate the facilities.

Products from both segments are marketed principally through in-house sales forces. The principal competitive factors are price and service. Considerable competition exists from numerous domestic manufacturers and foreign imports. During 2000 and 2001, imports of steel increased significantly, much of it at illegally dumped prices. In March 2002, President Bush imposed a series of tariffs for many products over a three-year period that helped reduce the flood of imports. The tariffs range from 8% to 30% in the first year, then decline to 7% to 24% in the second year and 6% to 18% in the third year. The International Trade Commission (“ITC”) has scheduled a section 204 mid-term review of the tariffs to evaluate their effectiveness. The Bush administration will then make a final decision on whether to maintain the tariffs, reduce them more quickly or end the tariffs prior to their scheduled expiration. The steel industry has advanced several additional trade actions against dumped imports; however, since the implementation of

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Item 1.Business, continued

the tariffs in March 2002, the ITC generally has ruled against the U.S. steel industry regarding incremental duties and tariffs.

Nucor believes that the most significant factors with respect to its competitive position are the low cost and efficiency of its production processes. The markets that Nucor serves are tied to capital and durable goods spending and are affected by changes in economic conditions.

On July 22, 2002, Nucor’s wholly owned subsidiary, Nucor Steel Decatur, LLC, purchased substantially all of the assets of Trico Steel Company, LLC (“Trico”) for a purchase price of $117,700,000. The purchase price included approximately $86,000,000 of Trico’s debt that was assumed by Nucor. Located in Decatur, Alabama, the sheet steel facility originally began operations in 1997 and has an annual capacity of approximately 1,900,000 tons. This acquisition was not material to the consolidated financial statements and did not result in goodwill or other intangible assets.

On December 9, 2002, Nucor and certain of its wholly owned subsidiaries purchased substantially all of the assets of Birmingham Steel Corporation (“Birmingham Steel”) for a cash purchase price, excluding transaction costs, of approximately $615,000,000, including $116,900,000 in inventory and receivables. Primary assets purchased were Birmingham Steel’s four operating mills in Birmingham, Alabama; Kankakee, Illinois; Seattle, Washington; and Jackson, Mississippi, with a combined annual capacity of approximately 2,000,000 tons. This acquisition did not result in goodwill or other intangible assets.

Nucor began operations of its 100% owned Castrip^® facility in Crawfordsville, Indiana, in May 2002. This facility uses the breakthrough technology of strip casting, to which Nucor holds exclusive rights in the United States and Brazil. Strip casting involves the direct casting of molten steel into final shape and thickness without further hot or cold rolling, allowing lower investment and operating costs, reduced energy consumption and smaller scale plants than can be economically built with current technology. This process also reduces the overall environmental impact of producing steel through significantly lower emissions, particularly NOx. Our team in Crawfordsville has succeeded in producing prime, saleable coils, and the plant is now staffed to operate 24 hours a day, seven days a week.

In April 2002, Nucor entered a joint venture with The Rio Tinto Group, Mitsubishi Corporation and Chinese steel maker, Shougang Corporation, to construct a commercial HIsmelt plant in Kwinana, Western Australia. Demolition of the pilot plant is completed and construction of the commercial facility has begun. The HIsmelt process converts iron ore fines and coal fines directly to liquid metal eliminating the need for a blast furnace, sinter/pellet plants and coke ovens. The HIsmelt technology would offer an alternative supply of high-quality iron units as a scrap substitute. Nucor has a 25% interest in the joint venture that owns the HIsmelt commercial plant.

Nucor’s backlog of orders at December 31, 2002 was about $816,000,000 ($628,000,000 in the steel mills segment and $188,000,000 in the steel products segment). Nucor’s backlog of orders at December 31, 2001 was about $794,000,000 ($632,000,000 in the steel mills segment and $162,000,000 in the steel products segment). These backlogs are normally filled within one year.

Nucor is highly decentralized and has approximately 48 employees in its executive offices. All of Nucor’s 9,800 employees are engaged in its steel mills and steel products businesses.

Additional information on Nucor’s business is incorporated by reference to Nucor’s 2002 annual report, pages 9 through 17.

Nucor’s annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to these reports are available without charge through Nucor’s website, www.nucor.com, as soon as reasonably practicable after such material is electronically filed with, or furnished to, the Securities and Exchange Commission.

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Item 2.Properties

Our principal operating facilities by segment are as follows:

Location	Approximate square footage of facilities	Principal products
Steel mills:
Blytheville, Arkansas	2,180,000	Steel shapes
Berkeley, South Carolina	1,940,000	Flat-rolled steel, steel shapes
Crawfordsville, Indiana	1,800,000	Flat-rolled steel
Norfolk, Nebraska	1,420,000	Steel shapes
Hickman, Arkansas	1,360,000	Flat-rolled steel
Plymouth, Utah	1,170,000	Steel shapes
Darlington, South Carolina	1,130,000	Steel shapes
Hertford County, North Carolina	1,000,000	Steel plate
Jewett, Texas	950,000	Steel shapes
Decatur, Alabama	670,000	Flat-rolled steel
Seattle, Washington	660,000	Steel shapes
Auburn, New York	400,000	Steel shapes
Kankakee, Illinois	370,000	Steel shapes
Jackson, Mississippi	340,000	Steel shapes
Birmingham, Alabama	290,000	Steel shapes
Steel products:
Norfolk, Nebraska	970,000	Joists, deck
Brigham City, Utah	750,000	Joists
Grapeland, Texas	570,000	Joists, deck
Chemung, New York	550,000	Joists, deck
St. Joe, Indiana	550,000	Joists, deck
Florence, South Carolina	530,000	Joists, deck
Fort Payne, Alabama	460,000	Joists, deck

Our steel mills segment also includes a distribution center in Pompano Beach, Florida. In the steel products segment, we have additional operating facilities in St. Joe and Waterloo, Indiana; Terrell, Texas; Dallas, Georgia; and Swansea, South Carolina. During 2002, the average utilization rate of all operating facilities in the steel mills and steel products segments were approximately 91% and 68% of production capacity, respectively.

Item 3.Legal Proceedings

In December 2000, the United States Environmental Protection Agency and the Department of Justice announced an agreement with Nucor and certain states that resolved alleged environmental violations. Under the terms of the agreement or Consent Decree, Nucor will pilot new air pollution control technology and will evaluate and improve, as appropriate, its water pollution control systems. Nucor will also evaluate and remediate any contamination that may be present on its sites. In July 2001, Nucor paid a $9,000,000 penalty and has agreed to spend another $4,000,000 in Supplemental Environmental Projects under this Consent Decree. As part of the Consent Decree, Nucor is implementing an Environmental Management System throughout its operations. The agreement is comprehensive and involves eight Nucor steel mills and six Vulcraft facilities throughout the nation. Nucor is involved in various judicial and administrative proceedings as both plaintiff and defendant, arising in the ordinary course of business. Nucor does not believe that any such proceedings (including matters relating to contracts, torts, taxes, warranties and insurance) will have a material adverse effect on its business, operating results, financial condition or cash flows.

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Item 4.Submission of Matters to a Vote of Security Holders

None during quarter ended December 31, 2002.

Executive Officers of the Registrant

The names, ages and positions held by the executive officers of Nucor as of the date of this Form 10-K are as follows:

Daniel R. DiMicco (52) - Mr. DiMicco has been a director of Nucor since 2000 and was elected as Vice Chairman in June 2001. Mr. DiMicco’s term as director expires at the 2004 annual meeting. Mr. DiMicco has served as Nucor’s President and Chief Executive Officer since September 2000. He previously served as Nucor’s Executive Vice President from 1999 to 2000 and Vice President from 1992 to 1999.

Terry S. Lisenby (51) - Mr. Lisenby has been Chief Financial Officer, Treasurer and Executive Vice President since January 2000. He previously served as Nucor’s Vice President and Corporate Controller from 1991 to 1999. Mr. Lisenby began his career with Nucor as Corporate Controller in 1985.

John J. Ferriola (50) - Mr. Ferriola has been an Executive Vice President of Nucor since January 2002 and a Vice President from 1996 to 2001. He was General Manager of Nucor Steel, Crawfordsville, Indiana from 1998 to 2001; General Manager of Nucor Steel, Norfolk, Nebraska from 1995 to 1998; General Manager of Vulcraft, Grapeland, Texas in 1995; and Manager of Maintenance and Engineering at Nucor Steel, Jewett, Texas from 1992 to 1995.

Hamilton Lott, Jr. (53) - Mr. Lott has been an Executive Vice President of Nucor since September 1999 and a Vice President from 1988 to 1999. He was General Manager of Vulcraft, Florence, South Carolina from 1993 to 1999; General Manager Vulcraft, Grapeland, Texas from 1987 to 1993; Sales Manager of Vulcraft, St. Joe, Indiana from January 1987 to May 1987 and Engineering Manager there from 1982 to 1986. Mr. Lott began his career with Nucor as Design Engineer at Vulcraft, Florence, South Carolina in 1975.

D. Michael Parrish (50) - Mr. Parrish has been an Executive Vice President of Nucor since November 1998 and a Vice President from 1990 to 1998. He was General Manager of Nucor Steel, Hickman, Arkansas from 1995 to 1998; General Manager of Nucor Steel, Jewett, Texas from 1991 to 1995; General Manager of Vulcraft, Brigham City, Utah from 1989 to 1991; Production Manager of Vulcraft, Fort Payne, Alabama from 1986 to 1989; Engineering Manager of Vulcraft, Brigham City, Utah from 1981 to 1986; and Engineer at Vulcraft, Saint Joe, Indiana from 1975 to 1981.

Joseph A. Rutkowski (48) - Mr. Rutkowski has been an Executive Vice President of Nucor since November 1998 and a Vice President from 1993 to 1998. He was General Manager of Nucor Steel, Hertford, North Carolina, from August 1998 to November 1998; General Manager of Nucor Steel, Darlington, South Carolina from 1992 to 1998; Manager of Melting and Casting of Nucor Steel, Plymouth, Utah from 1991 to 1992; and Manager of Nucor Cold Finish, Norfolk, Nebraska from 1989 to 1991.

James M. Coblin (59) - Mr. Coblin has been Vice President of Human Resources since January 2000. He previously served as Nucor’s General Manager of Human Resources from 1996 to 1999. Mr. Coblin began his career with Nucor as Manager of Personnel Service in 1986.

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PART II

Item 5.Market for Registrant’s Common Stock and Related Stockholder Matters

The information regarding the market of Nucor’s common stock, quarterly market price ranges, the number of stockholders and dividend payments is incorporated by reference to Nucor’s 2002 Annual Report, pages 25 and 42. The information regarding the number of securities issuable under equity compensation plans and the related weighted-average exercise price is incorporated by reference to Nucor’s Proxy Statement for the Annual Meeting of Stockholders to be held on May 8, 2003 (the “Proxy Statement”).

Item 6.Selected Financial Data

Incorporated by reference to Nucor’s 2002 Annual Report, page 25.

Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations

Incorporated by reference to Nucor’s 2002 Annual Report, page 2 and pages 18 through 21.

Item 7A.Quantitative and Qualitative Disclosures about Market Risk

Some of Nucor’s industrial revenue bonds have variable interest rates that are adjusted weekly, monthly or annually. Additionally, Nucor entered into an interest rate swap agreement, converting a note payable of $175,000,000 from a fixed rate obligation to a variable rate obligation. Nucor’s remaining debt is at fixed rates. Future changes in interest rates are not expected to significantly impact earnings. Nucor’s investment practice is to invest in securities that are highly liquid with short maturities. As a result, we do not expect changes in interest rates to have a significant impact on the value of our investment securities.

Item 8.Financial Statements and Supplementary Data

Incorporated by reference to Nucor’s 2002 Annual Report, pages 26 through 39.

Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosures

None.

PART III

Item 10.Directors and Executive Officers

The information regarding Nucor’s directors contained on page 3 of the Proxy Statement under the caption “Election of Directors” and the information regarding Nucor’s directors and executive officers contained on page 12 of the Proxy Statement under the caption “Section 16(a) Beneficial Ownership Reporting Compliance” is incorporated herein by reference. Pursuant to Item 401(b) of Regulation S-K, executive officers of Nucor are reported in Part I of this report.

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Item 11.Executive Compensation

Incorporated by reference to Nucor’s Proxy Statement

Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Incorporated by reference to Nucor’s Proxy Statement.

Item 13.Certain Relationships and Related Transactions

None.

Item 14.Controls and Procedures

Within 90 days prior to the date of this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective. There were no significant changes in the Company’s internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation or any corrective actions with regard to significant deficiencies or material weaknesses.

PART IV

Item 15.Exhibits, Financial Statement Schedules, and Reports on Form 8-K

Financial Statements:

The following consolidated financial statements and the report of independent accountants are incorporated herein by reference to Nucor Corporation’s 2002 Annual Report, pages 26 through 39:

•Consolidated balance sheets - December 31, 2002 and 2001

•Consolidated statements of earnings - Years ended December 31, 2002, 2001 and 2000

•Consolidated statements of stockholders’ equity - Years ended December 31, 2002, 2001 and 2000

•Consolidated statements of cash flows - Years ended December 31, 2002, 2001 and 2000

•Notes to consolidated financial statements

•Report of independent accountants

Financial Statement Schedules:

All schedules are omitted because they are not required, not applicable, or the information is furnished in the consolidated financial statements or notes.

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Exhibits:
2	Asset Purchase Agreement, dated May 30, 2002, by and between JAR Acquisition Corp., the Company, Birmingham Steel, Birmingham Southeast, LLC and Port Everglades Steel Corporation (incorporated by reference to Form 8-K dated December 20, 2002)
2(i)	Purchase Agreement, dated as of September 26, 2002, between Nucor Corporation and Banc of America Securities LLC, Wachovia Securities, Inc., Banc One Capital Markets, Inc., CIBC World Markets Corp. and BNY Capital Markets, Inc. (incorporated by reference to Form S-4 filed December 13, 2002)
2(ii)*	Asset Purchase Agreement by and among Trico Steel Company, L.L.C., Nucor Steel Decatur, LLC (formerly Nucor Steel Alabama, LLC) and Nucor Corporation, dated as of November 9, 2001
3	Restated Certificate of Incorporation (incorporated by reference to Form 10-K for year ended December 31, 1990)
3(i)	Certificate of amendment dated May 14, 1992, to Restated Certificate of Incorporation (incorporated by reference to Form 10-K for year ended December 31, 1992)
3(ii)	Certificate of amendment dated May 14, 1998, to Restated Certificate of Incorporation (incorporated by reference to Form 10-K for year ended December 31, 1998)
3(iii)	Certificate of Designations dated March 8, 2001 to Restated Certificate of Incorporation (incorporated by reference to Form 10-K for year ended December 31, 2001)
3(iv)	By-Laws as amended December 4, 2001 (incorporated by reference to Form 10-K for year ended December 31, 2001)
4	Rights Agreement, dated as of March 8, 2001, between Nucor Corporation and American Stock Transfer & Trust Co. (incorporated by reference to Exhibit 4 to Nucor’s Form 8-K filed March 9, 2001)
4(i)	Indenture, dated as of January 12, 1999, between Nucor Corporation and The Bank of New York, as trustee. (incorporated by reference to Form S-4 filed December 13, 2002)
4(ii)	Second Supplemental Indenture, dated as of October 1, 2002, between Nucor Corporation and The Bank of New York, as trustee. (incorporated by reference to Form S-4 filed December 13, 2002)
4(iii)	Exchange and Registration Rights Agreement, dated as of October 1, 2002, by and among Nucor Corporation, Banc of America Securities LLC and Wachovia Securities, Inc. (incorporated by reference to Form S-4 filed December 13, 2002)
4(iv)	Form of 4.875% Note due 2012 (included in Exhibit 4(ii) above) (incorporated by reference to Form S-4 filed December 13, 2002)
10	Key Employees Incentive Stock Option Plan (incorporated by reference to Form 10-K for year ended December 31, 2000) (1)
10(i)	Non-Employee Director Equity Plan (incorporated by reference to Form 10-K for year ended December 31, 2000) (1)
10(ii)	Employment Agreement of Daniel R. DiMicco (incorporated by reference to Form 10-Q for quarter ended June 30, 2001) (1)
10(iii)	Employment Agreement of Terry S. Lisenby (incorporated by reference to Form 10-Q for quarter ended June 30, 2001) (1)
10(iv)	Employment Agreement of Hamilton Lott, Jr. (incorporated by reference to Form 10-Q for quarter ended June 30, 2001) (1)
10(v)	Employment Agreement of D. Michael Parrish (incorporated by reference to Form 10-Q for quarter ended June 30, 2001) (1)
10(vi)	Employment Agreement of Joseph A. Rutkowski (incorporated by reference to Form 10-Q for quarter ended June 30, 2001) (1)
10(vii)	Employment Agreement of John J. Ferriola (incorporated by reference to Form 10-K for year ended December 31, 2001) (1)
10(viii)	Multi-Year Revolving Credit Agreement, dated as of October 4, 2002 (incorporated by reference to Form S-4/A dated February 28, 2003)
10(ix)	364-Day Revolving Credit Agreement, dated as of October 4, 2002 (incorporated by reference to Form S-4/A dated February 28, 2003)

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Exhibits, continued:
10(x) *	Senior Officers Severance Policy as Adopted by the Board of Directors, as amended on December 10, 2002 (1)
13 *	2002 Annual Report (portions incorporated by reference)
21 *	Subsidiaries
23 *	Consent of independent accountants
24 *	Powers of attorney
99(i)	United States District Court, District of South Carolina, Florence Division; United States of America, Plaintiff, the States of Arkansas, Nebraska, and Utah, Plaintiff-Interveners v. Nucor Corporation, Defendant; Consent Decree (incorporated by reference to Form 10-K for year ended December 31, 2000)
99(ii) *	Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99(iii) *	Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

______________

*Filed herewith.

(1)Indicates a management contract or compensatory plan or arrangement.

Reports on Form 8-K:

On October 3, 2002, Nucor filed a current report on Form 8-K under Item 5 concerning the issuance of $350,000,000 of 4.875% Notes due 2012. The notes are unsecured and rank equally with all of the Company’s unsecured senior indebtedness outstanding from time to time.

On December 20, 2002, Nucor filed a current report on Form 8-K under Item 2 concerning the purchase of substantially all of the assets of Birmingham Steel Corporation (“Birmingham Steel”) for a cash purchase price of approximately $615,000,000.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed (1) by the Registrant, and (2) on behalf of the Registrant, by its principal executive, financial and accounting officers, and its directors.

NUCOR CORPORATION
By:	/s/ DANIEL R. DIMICCO	*  PETER C. BROWNING
	Daniel R. DiMicco Vice Chairman, President and Chief Executive Officer	Peter C. Browning Non-Executive Chairman
/s/ DANIEL R. DIMICCO		*  CLAYTON C. DALEY,JR
Daniel R. DiMicco Vice Chairman, President and Chief Executive Officer		Clayton C. Daley, Jr. Director
/s/ TERRY S. LISENBY		*  HARVEY B. GANTT
Terry S. Lisenby Chief Financial Officer, Treasurer and Executive Vice President		Harvey B. Gantt Director
/s/ JAMES D. FRIAS		*  VICTORIA F. HAYNES
James D. Frias Corporate Controller and General Manager		Victoria F. Haynes Director
		*  JAMES D. HLAVACEK
		James D. Hlavacek Director
		*  RAYMOND J. MILCHOVICH
		Raymond J. Milchovich Director
		*  THOMAS A. WALTERMIRE
		Thomas A. Waltermire Director
		*By	/s/ TERRY S. LISENBY
			Terry S. Lisenby Attorney-in-fact

Dated: March 24, 2003

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NUCOR CORPORATION
Section 302 Certifications

Certification of Principal Executive Officer

I, Daniel R. DiMicco, certify that:

1.I have reviewed this annual report on Form 10-K of Nucor Corporation;

2.Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3.Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;

b) evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the “Evaluation Date”); and

c) presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

6.The registrant’s other certifying officer and I have indicated in this annual report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

March 24, 2003	/s/ Daniel R. DiMicco
	Daniel R. DiMicco Vice Chairman, President and Chief Executive Officer

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Certification of Principal Financial Officer

I, Terry S. Lisenby, certify that:

1.I have reviewed this annual report on Form 10-K of Nucor Corporation;

2.Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3.Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;

b) evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the “Evaluation Date”); and

c) presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

6.The registrant’s other certifying officer and I have indicated in this annual report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

March 24, 2003	/s/ Terry S. Lisenby
	Terry S. Lisenby Chief Financial Officer, Treasurer and Executive Vice President

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NUCOR CORPORATION
List of exhibits to Form 10-K – December 31, 2002

Exhibit No	Description of Exhibit
2(ii)	Asset Purchase Agreement by and among Trico Steel Company, L.L.C., Nucor Steel Decatur, LLC (formerly Nucor Steel Alabama, LLC) and Nucor Corporation, dated as of November 9, 2001
10(x)	Senior Officers Severance Policy as Adopted by the Board of Directors, as amended on December 10, 2002
13	2002 Annual Report (portions incorporated by reference)
21	Subsidiaries
23	Consent of independent accountants
24	Powers of attorney
99(ii)	Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99(iii)	Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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EX-2.II

Exhibit 2(ii)

ASSET PURCHASE AGREEMENT

by and among

TRICO STEEL COMPANY, L.L.C.

NUCOR STEEL ALABAMA, LLC

and

NUCOR CORPORATION

Dated as of November 9, 2001

TABLE OF CONTENTS

			Page
1.	DEFINITIONS AND REFERENCES		1
	1.01	Definitions	1
	1.02	Certain References	10
2.	SALE OF ASSETS AND RELATED MATTERS		11
	2.01	Sale of Assets	11
	2.02	Excluded Assets	12
	2.03	Assumed Liabilities	13
	2.04	Excluded Liabilities	13
	2.05	Purchase Price	14
3.	REPRESENTATIONS AND WARRANTIES OF SELLER		15
	3.01	Organization	15
	3.02	Powers; Consents; Absence of Conflicts	15
	3.03	Binding Agreement	16
	3.04	Investments and Third Party Rights	16
	3.05	Financial Statements	16
	3.06	Recent Activities	16
	3.07	Assets	17
	3.08	Equipment	17
	3.09	Title to Personal Property	17
	3.10	Real Property	17
	3.11	Environmental Matters	19
	3.12	Intellectual Properties/Computer Software	20
	3.13	Insurance	21
	3.14	Permits and License	21
	3.15	Agreements and Commitments	21
	3.16	The Contracts	23
	3.17	Employees and Employee Relations	23
	3.18	Employee Benefit Plans	24
	3.19	Litigation and Proceedings	24
	3.20	Taxes	24
	3.21	Brokers and Finders	25
	3.22	Payments	25
	3.23	Customer List	25
	3.24	Compliance with Legal Requirements	25
4.	REPRESENTATIONS AND WARRANTIES OF BUYER		25
	4.01	Organization	26
	4.02	Powers; Consents; Absence of Conflicts	26
	4.03	Binding Agreement	26
	4.04	Brokers and Finders	26
	4.05	Payments	26
	4.06	Adequate Assurance	27
5.	COVENANTS AND AGREEMENTS OF THE PARTIES		27

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	5.01	Filing of Sale Motion; Entry of Buyer Protection and Bidding Procedures Order; Additional Seller	27
	5.02	Operations	27
	5.03	Certain Actions	28
	5.04	Employee Matters	28
	5.05	Access to and Provision of Additional Information	28
	5.06	Post-Closing Maintenance of and Access to Information	29
	5.07	Governmental Authority Approvals; Consents to Assignment	30
	5.08	Allocation of Purchase Price for Tax Purposes	32
	5.09	Further Acts and Assurances	32
	5.10	Costs and Expenses	32
	5.11	Insurance Ratings	33
	5.12	Fulfillment of Conditions	33
	5.13	Release of Encumbrances	33
	5.14	Assumed and Assigned Contracts; Rejected Contracts	33
	5.15	Bankruptcy Court Approval	34
	5.16	Transfer Taxes	36
	5.17	Non-Solicitation	36
	5.18	Guaranty of Buyer’s Obligations	36
6.	CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER		37
	6.01	Representations and Warranties; Covenants	37
	6.02	Adverse Actions or Proceedings	37
	6.03	Pre-Closing Confirmations	37
7.	CONDITIONS PRECEDENT TO OBLIGATIONS OF BUYER		37
	7.01	Representations and Warranties; Covenants	37
	7.02	Pre-Closing Confirmations and Contractual Consents	38
	7.03	Adverse Actions or Proceedings	38
	7.04	Deliveries at Closing	38
8.	CLOSING; TERMINATION OF AGREEMENT		39
	8.01	Closing	39
	8.02	Action of Seller at Closing	39
	8.03	Action of Buyer at Closing	40
	8.04	Termination Prior to Closing; Break-Up Fee; Expense Reimbursement; Other Compensation	41
9.	GENERAL		43
	9.01	Schedules	43
	9.02	Tax Effect	44
	9.03	Reproduction of Documents	44
	9.04	Time of Essence	44
	9.05	Consents, Approvals and Discretion	44
	9.06	Choice of Law; Submission to Jurisdiction	44
	9.07	Benefit; Assignment	45
	9.08	No Third Party Beneficiary	45
	9.09	Waiver of Breach, Right or Remedy	45
	9.10	Notices	45

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9.11	Misdirected Payments; Offset Rights.	46
9.12	Severability	47
9.13	Entire Agreement; Counterparts; Amendment	47
9.14	Survival	47
9.15	Drafting	48
9.16	Confidentiality	48
9.17	Publicity	48

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LIST OF SCHEDULES AND EXHIBITS

Schedule 2.01(a)	List of Real Property
Schedule 2.01(b)	List of Personal Property
Schedule 2.01(e)	List of Assumed Contracts
Schedule 2.01(f)	List of Licenses, Permits and Approvals
Schedule 2.01(g)	List of Intellectual Properties and Computer Software
Schedule 2.01(h)	List of Investments
Schedule 2.02(b)	Completed Contracts
Schedule 2.02(d)	Excluded Assets
Schedule 2.02(h)	Claims and Causes of Action
Schedule 2.03	Assumed Liabilities
Schedule 3.02(b)	Requisite Approvals, Consents and Filings
Schedule 3.02(c)	Breaches of Assumed Contracts
Schedule 3.02(d)	Violations of Legal Requirements
Schedule 3.04	Agreements, Contracts, Commitments and Rights
Schedule 3.05	Financial Statements
Schedule 3.06	Recent Activities
Schedule 3.07	Direct, Indirect and Beneficial Interests
Schedule 3.08	Equipment Condition
Schedule 3.09	Title to Personal Property
Schedule 3.10	Real Property Encumbrances
Schedule 3.10(b)	Permitted Encumbrances
Schedule 3.11	Environmental Matters
Schedule 3.12(a)	Exceptions to Ownership of Intellectual Properties and Computer Software
Schedule 3.12(b)	Patents
Schedule 3.12(c)	Licenses of Intellectual Properties
Schedule 3.13	Insurance
Schedule 3.15	List of Contracts
Schedule 3.16	Contract Disclosures
Schedule 3.17(b)	Employees and Employee Relations
Schedule 3.18(a)	Employee Benefit Plans
Schedule 3.19	Litigation and Proceedings
Schedule 3.20(b)	Tax Matters
Schedule 3.20(c)	List of Income Tax Returns
Schedule 3.20(d)	Basis in Assets
Schedule 4.02(b)	Requisite Approvals, Consents and Filings
Schedule 5.03	Certain Actions
Schedule 5.04	Employment and Severance Contracts
Schedule 5.14(b)	List of Rejected Contracts
Exhibit A	Form of Escrow Agreement

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ASSET PURCHASE AGREEMENT

This ASSET PURCHASE AGREEMENT (“Agreement”) is made and entered into as of the ______ day of November, 2001, by and between NUCOR STEEL ALABAMA, LLC, a Delaware limited liability company (together with its assignees, if any, “Buyer”), NUCOR CORPORATION, a Delaware corporation (“Guarantor”), and TRICO STEEL COMPANY, L.L.C., a Delaware limited liability company (“Seller”).

WITNESSETH

WHEREAS, Seller is currently a debtor and debtor-in-possession in the Bankruptcy Case (as defined) currently pending before the Bankruptcy Court (as defined);

WHEREAS, pursuant to this Agreement and in furtherance of the Transaction (as defined), Seller will covenant pursuant to this Agreement to seek the Buyer Protection and Bidding Procedures Order (as defined), the Executory Contract Assumption and Assignment Order (as defined) and the Sale Order (as defined) from the Bankruptcy Court; and

WHEREAS, Seller desires to sell the Assets to Buyer, and Buyer desires to purchase the Assets from Seller, on the terms and subject to the conditions set forth in this Agreement,

NOW, THEREFORE, for and in consideration of the foregoing premises, and the agreements, covenants, representations and warranties hereinafter set forth, and other good and valuable consideration, the receipt and adequacy of which are forever acknowledged and accepted, the parties, intending to be legally bound, hereby agree as follows:

1. DEFINITIONS AND REFERENCES

1.01 Definitions.

As used in this Agreement, and unless the context requires a different meaning, the following terms have the meanings given:

Accounts Receivable: all accounts receivable of Seller, of whatever kind or nature, including all current or deferred rights to payment for projects completed or commenced or services rendered on or prior to the Closing Date, whether or not such services have been billed by Seller as of the Closing Date;

Adverse Consequences: regardless of any disclosures by Seller and any knowledge of Buyer, any and all actual or reasonably estimated expenses, liabilities, claims, costs, or other impairments in value of any kind (including reasonable attorneys’ fees and expenses associated therewith) relating to the Assets or the Business or the operation or use thereof, that individually or in the aggregate total Seven Million Five Hundred Thousand Dollars ($7,500,000); provided, however, that Adverse Consequences shall not include (i) items that are required to be paid, discharged or assumed by Buyer

pursuant to the Assumed Contracts; (ii) any items reflected on Schedule 2.02(d); and (iii) any items reflected on Schedule 2.03.

Affiliate: any Person that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with another Person, including the power to direct or cause the direction of the management and policies of a Person, whether through the beneficial ownership of more than fifty (50%) percent of the equity securities of such Person, election or appointment of directors, by Contract or otherwise;

Affiliated Group: any affiliated group within the meaning of §1504 of the Code or any similar group defined under a similar provision of state, local or foreign law;

Agent: JPMorgan Chase Bank (f/k/a The Chase Manhattan Bank), as the administrative agent under the Credit Agreement.

Agreement: this Asset Purchase Agreement and all Exhibits and Schedules attached hereto, as amended, consolidated, supplemented, novated or replaced by the parties from time to time;

Assets: all of Seller’s assets, real, personal and mixed, tangible and intangible, including assets owned by Seller or leased by Seller pursuant to capital leases, and including the assets reflected on the Interim Financial Statements in such amounts as exist on the Closing Date, but excluding in any event the Excluded Assets;

Assumed Contracts: all Contracts of Seller described on Schedule2.01(e), as may be amended by Buyer in Buyer’s sole discretion at any time prior to Closing;

Assumed Liabilities: all liabilities and obligations of Seller set forth on Schedule2.03;

Audited Financial Statements: the audited consolidated balance sheets and the audited consolidated statements of operations and comprehensive income and cash flows of Seller for the fiscal years ended December 31, 1998 and December 31, 1999, together with the notes thereto and the report thereon of Ernst & Young, LLP, independent certified public accountants, and any audited restatements thereof;

Bankruptcy Case: the case under Chapter 11 of the Bankruptcy Code filed by Seller in the Bankruptcy Court;

Bankruptcy Code: 11 U.S.C. §§ 101 et seq., and applicable federal rules of bankruptcy procedure thereunder;

Bankruptcy Court: (a) the United States Bankruptcy Court for the District of Delaware, (b) to the extent of any reference under §157 of Title 28 of the United States Code, the unit of such District Court constituted under §151, Title 28 of the United States

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Code or (c) such other Court to which the Bankruptcy Case may be transferred;

Bid Deadline: the date established in the Buyer Protection and Bidding Procedures Order as the deadline for submissions of Qualified Bids;

Break-Up Fee: an amount equal to Three Million Nine Hundred Thousand Dollars ($3,900,000) to be paid to Buyer by Seller, or to Seller by Buyer, under the circumstances set forth in Article 8 hereof.

Business: the steel mill and ancillary facilities related thereto owned, leased, managed or otherwise operated or conducted by Seller and located in Decatur, Alabama; provided, however, that the term “Business” shall not include any businesses operated or conducted by or through Trico, Inc.;

Business Day: any day on which the banks located in Charlotte, North Carolina are open for and conduct business, excluding any Saturday, Sunday and/or public holiday observed in Charlotte, N.C.

Buyer: as defined in the Preamble;

Buyer Protection and Bidding Procedures Order: an Order of the Bankruptcy Court that (a) approves the Seller’s entering into this Agreement, the Termination Fee, the Break-Up Fee and the Expense Reimbursement on the terms and conditions set forth in Section8.04 and (b) otherwise is in form and substance reasonably acceptable to Buyer and that (i) conforms to the description set forth in Section5.15(c), (ii) approves the provisions of Sections5.01, 5.02, 5.03, 5.05 and 5.16 and (iii) authorizes and directs Seller to observe and perform its obligations under the Buyer Protection and Bidding Procedures Order;

Cash: cash and cash equivalents;

Closing: as defined in Section 8.01;

Closing Date: the date on or as of which the Closing occurs;

Code: the Internal Revenue Code of 1986, as amended;

Competing Proposal: a competitive bid or proposal from a third party (a) to purchase substantially all of Seller’s assets whether in a separate transaction or series of transactions or as part of a plan of reorganization of Seller or (b) for any merger, consolidation, liquidation, dissolution or similar transaction involving Seller;

Completed Contracts: Contracts of Seller, including those specifically set forth on Schedule2.02(b), under which substantially all of the contractual work effort of Seller has been completed, even if such Contracts have continuing warranty obligations, administrative matters or work related to warranty or other claims;

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Completed Contracts Receivables: all Accounts Receivables related to Completed Contracts;

Contracts: all commitments, contracts, leases, licenses, agreements and understandings, written or oral, relating to the Assets or the operation of the Business to which Seller is a party or by which it or any of its Assets are bound;

Controlled Group: with respect to Seller, a group consisting of each trade or business (whether or not incorporated) that, together with Seller, would be deemed a “single employer” within the meaning of §4001(b)(1) of ERISA or subsections (b), (c), (m) or (o) of §414 of the Code;

Credit Agreement: the Credit and Reimbursement Agreement, dated as of November 30, 1995, among the Seller, the several lenders from time to time parties thereto, the Agent, and JPMorgan Chase Bank (f/k/a The Chase Manhattan Bank), as Issuing Bank.

Deposit: as defined in Section 2.05(b);

Effective Date: the latest date on which occurs Seller’s, Buyer’s and Guarantor’s execution of this Agreement;

Employee Benefit Plan: any (a) nonqualified deferred compensation or retirement plan or arrangement that is an Employee Pension Benefit Plan, (b) qualified defined contribution retirement plan or arrangement that is an Employee Pension Benefit Plan (including any Multiemployer Plan), (c) qualified defined benefit retirement plan or arrangement that is an Employee Pension Benefit Plan (including any Multi-employer Plan), or (d) Employee Welfare Benefit Plan or material fringe benefit plan or program;

Employee Welfare Benefit Plan: as defined in §3(1) of ERISA;

Encumbrances: liabilities, levies, claims, charges, assessments, mortgages, security interests, liens, pledges, conditional sales agreements, title retention contracts, leases, subleases, rights of first refusal, rights of setoff, rights of recompense and other similar rights, options to purchase, restrictions, easements, covenants and other encumbrances, and agreements or commitments to create or suffer any of the foregoing;

Environmental Claim: any oral or written notice by a Person alleging liability (including liability for investigatory costs, cleanup costs, Governmental Authority response costs, natural resource damages, property damages, personal injuries, or penalties) arising out of, based on or resulting from (a) the presence, or release into the environment, of any Materials of Environmental Concern at any location, whether or not owned by Seller, or (b) circumstances forming the basis of any violation, or alleged violation, of any Environmental Laws; or (c) circumstances in which Seller have or may have retained or assumed either contractually or by operation of law any liability for any

4

Environmental Claims alleged or asserted against any third party;

Environmental Laws: any and all Legal Requirements relating to pollution or protection of human health or the environment (including ground water, land surface or subsurface strata), including Legal Requirements relating to emissions, discharges, releases or threatened releases of Materials of Environmental Concern, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport, recycling, reporting or handling of Materials of Environmental Concern;

Environmental Studies: the United States Environmental Protection Agency Self-Assessment prepared on behalf of Seller by RMT Incorporated dated February 1, 2001 and the Phase I environmental studies dated March 23, 1995, April 14, 1995 and October 12, 1995;

ERISA: the Employee Retirement Income Security Act of 1974, as amended;

Escrow Agent: as defined in Section 2.05(b);

Excluded Assets: as defined in Section2.02;

Excluded Liabilities: any and all liabilities or obligations of Seller of any kind or nature, other than the Assumed Liabilities, whether known or unknown, fixed or contingent, recorded or unrecorded, and whether arising before or after the Closing, including claims relating to professional liability, errors and omissions, pending and threatened litigation, pending and future claims relating to asbestos, and claims in connection with performance, surety or other bonds relating to Completed Contracts or Rejected Contracts;

Executory Contract Assumption and Assignment Order: an Order of the Bankruptcy Court, which may be the Sale Order and must be in form and substance reasonably acceptable to Buyer, that (a) approves the provisions of Section5.14(a), (b) authorizes and directs Seller, pursuant to §365 of the Bankruptcy Code, to assume and to assign to Buyer the Assumed Contracts and to make all pre-petition and post-petition payments related thereto that are not Assumed Liabilities (c) determines that Buyer has provided adequate assurance of future performance relative to the Assumed Contracts, and (d) conclusively establishes the amounts necessary to cure all defaults under the Assumed Contracts;

Expense Reimbursement: an amount up to One Million Dollars ($1,000,000) to reimburse Buyer for any and all of its actual, reasonable out-of-pocket costs and expenses (including documented legal, accounting, and other consultant fees and expenses) incurred in connection with or related to the Transaction, that shall be paid by Seller to Buyer under the circumstances set forth in Section8.04(c), Section8.04(d) or Section 8.04(e);

Final Order: an order of the Bankruptcy Court, the operation or effect of which

5

has not been stayed, and that is not subject to any pending appeal, request for leave to appeal or request for reconsideration and as to which the time for any such appeal, request for leave to appeal or request for reconsideration has expired;

GAAP: as defined in Section3.05;

Governmental Authorities: all agencies, authorities, bodies, boards, commissions, courts (including the Bankruptcy Court), instrumentalities, legislatures and offices of any nature whatsoever of any federal, state, county, district, municipal, city, foreign or other government or quasi-government unit or political subdivision;

HSR Act: the Hart-Scott Rodino Antitrust Improvements Act of 1976, as amended;

Immaterial Contracts: Contracts that (i) require the future performance by Seller of services having a value of Seventy-Five Thousand Dollars ($75,000) or less, or (ii) are terminable by Seller at any time without cause upon thirty (30) days’ notice or less; provided, however, that, notwithstanding the foregoing, Immaterial Contracts shall not include any Contracts set forth on Schedule3.15 or any Contracts that, pursuant to §365 of the Bankruptcy Code, are not assumable or assignable without the consent of the non-debtor parties thereto;

Initial Due Diligence Period: as defined in Section 5.05(a);

Intellectual Properties: all of Seller’s marks, names, and all variations of the foregoing, all trademarks, service marks, assumed names, logos, including all goodwill associated therewith, patents, patent rights, copyrights, trade secrets, confidential business information (including research and development, manufacturing and production processes and techniques and pricing and cost information) and similar intangibles (including all variants thereof, applications therefor and renewals or extensions thereof); provided, however, that Intellectual Properties shall not include any right, title or interest in or to the name “Trico Steel Company, L.L.C.”;

Interim Financial Statements: the unaudited consolidated balance sheet of Seller as of September 30, 2001 and consolidated statement of operations and comprehensive income and cash flows of Seller for the three (3) months ended March 31, 2001, attached to this Agreement as Schedule 3.05;

Investments: shares of capital stock of any corporation, interests in partnerships or limited liability companies, or other equity or debt instruments issued by any Person, and proceeds from the sale thereof;

Knowledge of Buyer: with reference to this Agreement means the actual knowledge of the executive officers of Buyer;

Knowledge of Seller: with reference to this Agreement means the actual

6

knowledge of any of the senior management team of Seller, to wit: Richard A. Veitch, Andrew J. Herman, Richard Snyder, James Mohr, Elmer L. Crist, Gregory M. Wotell and Daniel Bobrowski;

Legal Requirements: with respect to any Person, all statutes, ordinances, by-laws, codes, rules, regulations, restrictions, judgments, orders, writs, injunctions, decrees, determinations or awards of any Governmental Authority having jurisdiction over such Person or any of such Person’s assets or businesses;

Letters of Credit: the letters of credit issued pursuant to the Credit Agreement in respect of the Solid Waste Disposal Bonds in the outstanding face amount of $86,000,000, as may have been amended, modified or supplemented

Materials of Environmental Concern: chemicals, pollutants, contaminants, medical waste or specimens, toxic substances, petroleum and petroleum products, including hazardous wastes under the Resource, Conservation and Recovery Act, as amended, 42 U.S.C. §6903 et seq., hazardous substances under the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. §9601 et seq., asbestos, polychlorinated biphenyls and urea formaldehyde, and low-level nuclear materials, special nuclear materials or nuclear-byproduct materials, all within the meaning of the Atomic Energy Act of 1954 as amended, and any rules, regulations or policies promulgated thereunder;

Minimum Incremental Bid Amount: Four Million One Hundred Thousand Dollars ($4,100,000) for any initial incremental bid and Two Million Dollars ($2,000,000) for any additional incremental bids thereafter;

Multiemployer Plan: defined in §§3(37) or 4001(a)(3) of ERISA;

Multiple Employer Plan: an Employee Pension Benefit Plan that is not a Multiemployer Plan and for which a Person who is not a member of a Controlled Group that includes Seller is or has been a contributing sponsor;

Other Plan: any Contract, program or arrangement that provides cash or noncash benefits or perquisites to current or former employees of Seller, but that is not an Employee Benefit Plan, as set forth on Schedule3.18(a);

Party: any party to this Agreement, its successors and assigns;

Permits: all licenses, permits, consents, approvals and other authorizations of or from all Governmental Authorities that are necessary to the ownership of the Assets or in the conduct of the Business as conducted prior to the Discontinuance of Operation Date;

Permitted Encumbrances: those Encumbrances set forth on Schedule3.10(b), which Encumbrances generally include utility easements and other customary covenants and restrictions of record that do not adversely affect the ownership or leasing of the Real

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Property or the conduct of the Business and Encumbrances related to Assumed Liabilities;

Person: any individual, company, body corporate, association, partnership, firm, joint venture, trust, trustee or Governmental Authority;

Pre-Closing Environmental Matters: all liabilities arising from (i) the pre-closing release of Materials of Environmental Concern either in, on, under or from the Real Property or any current or former facility where Seller has conducted the Business including, without limitation, the effects of such release of Materials of Environmental Concern on natural resources, Persons or property within or outside the boundaries of the Real Property or any such current or former facility, (ii) the presence as of the Closing Date of Materials of Environmental Concern in, on or under the Real Property or any such current or former facility, (iii) the failure on or prior to the Closing Date of the facility or any former facility or any operations of Seller to be in compliance with any Environmental Laws in effect at the time of Closing, (iv) the disposal of Materials of Environmental Concern by the Business or arrangement thereof at any location other than the Real Property or the current or former facilities on or prior to the Closing Date, and (v) any other pre-Closing act, omission or condition existing with respect to any of the Assets or related to the Business, the Real Property or any current or former facility prior to the Closing Date that gives rise to liability under any Environmental Laws in effect at the time of Closing;

Purchase Price: as defined in Section2.05(a);

Qualified Bid: a Competing Proposal (a) whose ascertainable value is greater than the sum of (i) the Purchase Price, (ii) the Break-Up Fee, (iii) the maximum Expense Reimbursement, and (iv) the initial Minimum Incremental Bid Amount, (b) has substantially the same terms and conditions as this Agreement, (c) is accompanied by satisfactory evidence of committed financing or other ability to perform, and (d) is accompanied by a good faith deposit of Ten Million Dollars ($10,000,000). For avoidance of doubt, this Agreement shall be deemed to be a Qualified Bid for substantially all of Seller’s assets;

Qualified Bidder: a Person (a) who has delivered to Seller an executed confidentiality agreement in form and substance substantially the same as the confidentiality agreement dated June 13, 2001 by and between Buyer and Seller (except that, prior to submission of a Qualified Bid, disclosure of the Qualified Bidder’s interest and proposal but not identity shall be permitted), (b) who has delivered to Seller a Competing Proposal that Seller, in good faith and upon the advice of its independent financial advisors, believe is reasonably likely to lead to a higher and better offer for the Assets, and (c) whom Seller in good faith determines is reasonably likely (based on the availability of financing and proof of financial wherewithal, experience and other relevant considerations) to be able to consummate a transaction based on the Competing Proposal, if selected as the successful bidder for the subject assets. For avoidance of doubt, Buyer shall be deemed to be a Qualified Bidder;

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Real Property: all real property owned, leased or subleased by Seller and all easements granted to Seller, each of which is described on Schedule2.01(a), together with all buildings, improvements and fixtures thereon and all appurtenances and rights thereto;

Rejected Contracts: all Contracts of Seller designated as such on Schedule5.14(b) (as amended or supplemented in accordance with Section5.14(b));

Rejected Contracts Receivable: all Accounts Receivable related to Rejected Contracts;

Sale Motion: the motion or motions, in form and substance reasonably acceptable to Buyer, filed by Seller, pursuant to the provisions of §§363 and 365 of the Bankruptcy Code in the Bankruptcy Case, among other things, to obtain the Sale Order, approve the Transaction, authorize the assumption and assignment of the Assumed Contracts to Buyer and obtain the Buyer Protection and Bidding Procedures Order;

Sale Order: an Order of the Bankruptcy Court, which may also be the Executory Contract Assumption and Assignment Order and must be in form and substance reasonably acceptable to Buyer, that, among other things, grants the Sale Motion, approves, authorizes and directs Seller to assume this Agreement and consummate the Transaction and contains all the provisions described in Section5.15(a);

Schedule Delivery Date: November 16, 2001, the date of which all schedules to the Agreement must be delivered by Seller to Buyer;

Sections: sections of the Agreement, unless the context indicates otherwise;

Seller: as defined in the Preamble;

Solid Waste Disposal Bonds: certain solid waste disposal revenue bonds issued by the Industrial Development Board of the City of Decatur, Alabama, (Trico Steel Company, L.L.C. Project) in the approximate principal amount of Eighty Six Million Dollars ($86,000,000).

Stand-Alone Plan: a plan of reorganization for Seller that does not involve a Qualified Bid;

Subsidiaries: as to any Person, a corporation, partnership, limited liability company or other entity of which fifty percent (50%) or more of the voting power of the outstanding voting equity securities or fifty percent (50%) or more of the outstanding economic equity interest is held or controlled, directly or indirectly, by such Person;

Tax: any income, unrelated business income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, privilege, premium, windfall profits,

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environmental (including taxes under §59A of the Code), customs duties, capital stock, franchise, profits, withholding, social security, unemployment, disability, real property, personal property, stamp, sales, use, transfer, registration, unclaimed property, value added, alternative or add-on minimum, estimated or other tax, assessment, charge, levy or fee of any kind whatsoever, including payments or services in lieu of Taxes, interest or penalties on and additions to all of the foregoing, that are due or alleged to be due to any Governmental Authority, whether disputed or not;

Tax Return: any return, declaration, report, claim for refund, information return or statement, including schedules and attachments thereto and amendments, relating to Taxes;

Termination Fee: an amount equal to One Million Five Hundred Thousand Dollars ($1,500,000) to be paid to Buyer by Seller or to Seller by Buyer, as the case may be, under the circumstances set forth in Article 8 hereof.

Transaction: the sale and purchase of the Assets contemplated in this Agreement, together with any and all related transactions and proceedings designed to implement, facilitate or expedite such sale and purchase of the Assets;

Tunnel Furnace Expense: any and all costs necessary to repair defects in the two (2) tunnel furnaces included in the Assets such that the product temperature uniformity with respect to such tunnel furnaces is optimized.

WARN Act: the Worker’s Adjustment and Retraining Notification Act, as amended, 29 U.S.C. §§2101-2109.

1.02 Certain References.

As used in this Agreement, and unless the context requires otherwise:

(a)references to “include” or “including” mean including without limitation;

(b)references to “partners” include general and limited partners of partnerships and members of limited liability companies;

(c)references to “partnerships” include general and limited partnerships, joint ventures and limited liability companies;

(d)references to “hereof, “herein” and derivative or similar words refer to this Agreement;

(e)references to any document are references to that document as amended, consolidated, supplemented, novated or replaced by the parties thereto from time to time;

(f)references to any law are references to that law as amended, consolidated,

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supplemented or replaced from time to time and all rules and regulations promulgated thereunder;

(g)references to time are references to Wilmington, Delaware time;

(h)the gender of all words includes the masculine, feminine and neuter, and the number of all words includes the singular and plural; and

(i)the Table of Contents, the divisions of this Agreement into articles, sections and subsections and the use of captions and headings in connection therewith are solely for convenience and shall have no legal effect in construing the provisions of this Agreement.

2. SALE OF ASSETS AND RELATED MATTERS

2.01 Sale of Assets.

Subject to the terms and conditions of this Agreement, at Closing Seller shall sell, assign, convey, transfer and deliver to Buyer, or cause to be sold, assigned, conveyed, transferred and delivered to Buyer, and Buyer shall purchase from Seller, the Assets, free and clear of all Encumbrances other than the Permitted Encumbrances, including, but not limited to, the following:

(a)Seller’s interest in the Real Property;

(b)all equipment, vehicles, furniture, fixtures and furnishings and other tangible personal property of Seller as are set forth on Schedule2.01(b);

(c)all usable supplies and inventory of Seller;

(d)all financial, project-related, personnel and other records of the Business (including equipment records, project plans, documents, catalogs, books, records, files and operating manuals);

(e)to the extent transferable or assignable, all interests of Seller in the contracts listed in Schedule 2.01(e) (the “Assumed Contracts”);

(f)all Permits and other approvals (including pending approvals) of Governmental Authorities relating to the ownership, development and operations of the Business or the Assets, including the Permits described on Schedule2.01(f), to the extent transferable or assignable under applicable Legal Requirements;

(g)to the extent transferable or assignable, all interests of Seller in and to all Intellectual Properties and all computer software, programs and similar systems (including data and related documentation) owned or licensed by Seller, including those set forth on Schedule 2.01(g);

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(h)the Investments described on Schedule2.01(h);

(i)general intangibles of the Business, including goodwill;

(j)to the extent transferable or assignable, any and all claims and causes of action, including privileges related thereto, of Seller against third parties relating to the Assumed Liabilities or the Assumed Contracts;

(k)all corporate office furniture and equipment, data center hardware and equipment and other assets of Seller wherever located;

(l)all security or other deposits relating to, without limitation, the Real Property and any equipment owned or leased by Seller;

(m)any prepaid expenses other than those related to Excluded Assets;

(n)to the extent held by or available to Seller after Seller’s commercially reasonable inquiry and investigation, all customer lists and sales invoices for the last three fiscal years related to Seller (whether or not such sales were made through Trico, Inc.), whether generated by, or used by, Seller or any Affiliate of Seller; and

(o)all proceeds of the foregoing and all other property of Seller of every kind, character or description, tangible and intangible, known or unknown, wherever located and whether or not reflected on the Audited Financial Statements or Interim Financial Statements, or similar to the properties described above except for the Excluded Assets.

2.02 Excluded Assets.

Notwithstanding the generality of Section2.01, the following assets are not a part of the sale and purchase contemplated by this Agreement and are excluded from the Assets (collectively, the “Excluded Assets”):

(a)the Rejected Contracts, all Rejected Contracts Receivables and all drawings related to the Rejected Contracts;

(b)the Completed Contracts and all Completed Contracts Receivables and drawings related to the Completed Contracts;

(c)inventory and supplies reflected on the Interim Financial Statements disposed of or exhausted prior to the Closing Date in the ordinary course of Seller’s Business and Assets transferred or disposed of in accordance with Section5.03;

(d)those other assets of Seller set forth on Schedule2.02(d);

(e)any avoidance claims available to Seller under Chapter 5 of the

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Bankruptcy Code and all claims relating to Excluded Liabilities;

(f)the Purchase Price;

(g)all Cash;

(h)any and all claims and causes of action of Seller against third parties, including, without limitation, the claims and causes of action set forth on Schedule 2.02(h), but excluding those claims and causes of action relating to the Assumed Liabilities and the Assumed Contracts;

(i)any other assets excluded by mutual written agreement of the parties;

(j)any utility deposits paid by Seller; and

(k)all Accounts Receivable.

2.03 Assumed Liabilities.

As of the Closing Date, Buyer shall assume only the liability for any Tunnel Furnace Expense and the Assumed Liabilities set forth on Schedule2.03, and no other liabilities of Seller whatsoever.

2.04 Excluded Liabilities.

Under no circumstance shall Buyer assume or be obligated to pay, and none of the Assets shall be or become liable for or subject to, any of the Excluded Liabilities, including, but not limited to, the following liabilities, which shall be and remain liabilities of Seller:

(a)liabilities not listed on the list of Assumed Liabilities contained in Schedule 2.03;

(b)liabilities accrued on the Interim Financial Statements other than the Assumed Liabilities;

(c)liabilities or obligations associated with any Excluded Assets;

(d)liabilities or obligations associated with any and all indebtedness of Seller for borrowed money not included in the Assumed Liabilities;

(e)liabilities or obligations arising under the Rejected Contracts or the Completed Contracts;

(f)liabilities or obligations arising out of or in connection with claims, litigation and proceedings (whether instituted prior to or after Closing) for acts or omissions that occurred, or arise from events that occurred, prior to the Closing Date,

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including such liabilities or obligations as are reflected on the Interim Financial Statements;

(g)liabilities or obligations (i) to Seller’s employees, (ii) with respect to the Employee Benefit Plans and Other Plans, (iii) of Seller to the Internal Revenue Service or any other Governmental Authority relating to Seller’s employees, in each case arising from or relating to periods prior to Closing (whether or not triggered by the Transaction or the announcement thereof);

(h)penalties, fines, settlements, interest, costs and expenses arising out of or incurred as a result of any actual or alleged violation by Seller of any Legal Requirement prior to the Closing Date;

(i)liabilities or obligations under the WARN Act, if any, arising out of or resulting from layoffs or termination of employees by Seller prior to Closing and/or the consummation of the Transaction sufficient in the aggregate to require notice under the WARN Act;

(j)liabilities related to Seller’s use of cash collateral under §363(c) of the Bankruptcy Code; and

(k)all liabilities for expenses (i) of the negotiation and preparation of this Agreement and (ii) relating to the Transaction, in each case to the extent incurred by Seller and including those related to legal counsel, accounting, brokerage and investment advisors fees and disbursements.

2.05 Purchase Price.

(a)Subject to the terms and conditions hereof, in reliance upon the representations and warranties of Seller and the covenants of Seller herein set forth and as consideration for the sale and purchase of the Assets, at Closing, Buyer shall purchase the Assets, shall assume the Assumed Liabilities and shall tender to Seller as the purchase price for the Assets the sum of One Hundred Twenty Million Dollars ($120,000,000) (the “Purchase Price”).

(b)Within five Business Days of the Effective Date, Buyer shall deliver to Wachovia Bank, N.A., as escrow agent (the “Escrow Agent”), a deposit (the “Deposit”) in the sum of Ten Million Dollars ($10,000,000). The Deposit shall be held by the Escrow Agent and shall be placed in an interest bearing escrow account in accordance with an escrow agreement substantially in the form set forth on Exhibit A. Buyer will select Escrow Agent, which shall be a United States banking institution. All fees related to the Escrow Agent are for the account of Seller.

(c)Within five Business Days of the Effective Date, Seller shall, in its discretion, either: (i) deliver to the Buyer an irrevocable standby letter of credit in form and substance reasonably acceptable to Buyer in the amount of One Million Five

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Hundred Thousand Dollars ($1,500,000), representing the Termination Fee; or (ii) deliver to the Escrow Agent an amount equal to the Termination Fee. Such funds shall be held by the Escrow Agent and shall be placed in an interest bearing account in accordance with the Escrow Agreement substantially in the form set forth in Exhibit A.

(d)At Closing, the Purchase Price shall be paid as follows:

(i) the Deposit and any accrued interest thereon shall be paid directly to Seller by the Escrow Agent; and

(ii)the balance shall be paid by Buyer to Seller in immediately available funds by wire transfer to an account specified by Seller; provided that, subject to the execution and delivery of definitive documentation in form and substance satisfactory to the Agent, including, without limitation, the provision of satisfactory credit support, the Buyer shall receive a dollar for dollar credit against the Purchase Price in the aggregate amount it assumes for the outstanding reimbursement and all other obligations in respect of the Letters of Credit.

3. REPRESENTATIONS AND WARRANTIES OF SELLER

Seller hereby represents and warrants to Buyer that the statements contained in Article 3 are correct and complete as of the Schedule Delivery Date and, except where limited to a specific date, shall be correct and complete as of the Closing Date:

3.01 Organization.

Seller is duly formed, validly existing and in good standing under the laws of the State of Delaware. Seller is licensed, registered, qualified or admitted to do business in each jurisdiction in which the ownership, use or leasing of any of Seller’s assets or properties (including the Assets), or the conduct or nature of the Business, makes such licensing, qualification or admission necessary, except where such failure would not individually or in the aggregate have a material adverse effect on the ownership of the Assets by Buyer.

3.02 Powers; Consents; Absence of Conflicts.

Subject to approval of this Agreement by the Bankruptcy Court, and confirmation by the Bankruptcy Court of the representations and warranties set forth in this Section 3.02, Seller has the requisite power and authority to conduct its businesses (including the Business) as now being conducted, to enter into this Agreement and to perform its obligations hereunder, and the execution, delivery and performance by Seller of this Agreement and the consummation of the Transaction:

(a)are within Seller’s powers, are not in contravention of the terms of its certificate of formation, limited liability company agreement or other organizational

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documents, each as amended to date, and have been duly authorized by all necessary limited liability company and member action;

(b)except as otherwise expressly provided in this Agreement or as set forth on Schedule3.02(b), do not require any approval or consent of, or filing with, any Governmental Authority;

(c)except as set forth on Schedule3.02(c), do not conflict with or result in any breach or contravention of, any Assumed Contract to which Seller is a party or by which it is bound; and

(d)except as set forth on Schedule3.02(d), do not violate any Legal Requirement to which Seller or the Assets may be subject.

3.03 Binding Agreement.

Subject to approval of this Agreement by the Bankruptcy Court, this Agreement and all instruments and agreements hereunder to which Seller is or becomes a party are (or upon execution will be) valid and legally binding obligations of Seller, enforceable against Seller in accordance with the respective terms hereof or thereof, except as enforceability may be subject to general principles of equity and as may be restricted, limited or delayed by applicable bankruptcy or other laws affecting creditors’ rights generally. Seller’s obligations under this Agreement are subject to the approval of the Bankruptcy Court.

3.04 Investments and Third Party Rights.

Except as set forth on Schedule3.04, Seller does not hold any Investments that are not reflected as assets on the Interim Financial Statements. Except as set forth on Schedule3.04,there are no agreements with, or options, commitments or rights in favor of, any Person to directly or indirectly acquire any of the Assets, or any interest therein.

3.05 Financial Statements.

Attached as Schedule3.05 are copies of the Audited Financial Statements and the Interim Financial Statements. Except as disclosed on Schedule3.05, the Audited Financial Statements and Interim Financial Statements are true, complete and accurate in all material respects, are consistent with the books and records of Seller and fairly present the financial condition and results of operations of Seller as of the dates thereof and for the periods therein referred to, all in accordance with United States generally accepted accounting principles as in effect from time to time (“GAAP”).

3.06 Recent Activities.

Except as set forth on Schedule3.06, to the Knowledge of Seller:

(a)no damage, destruction or loss (whether or not covered by insurance) has

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occurred that individually or in the aggregate would have a material adverse effect on the ownership, operation or use of the Assets;

(b)Seller has not sold, assigned, transferred, distributed or otherwise disposed of any of the Assets, except for fair consideration in the ordinary course of the Business or as permitted by Order of the Bankruptcy Court; and

(c)Seller has not canceled or waived any rights in respect of the Assets, except in the ordinary course of the Business.

3.07 Assets.

Except as set forth on Schedule3.07, (i) the Assets constitute all assets that were owned by Seller and used to conduct the Business prior to the Discontinuance of Operation Date; and (ii) no Person other than Seller owns, holds title to or has any other direct, indirect or beneficial interest in any of the Assets.

3.08 Equipment.

Except as set forth on Schedule3.08, to the Knowledge of Seller, all equipment included within the Assets, whether reflected in the Audited Financial Statements or the Interim Financial Statements or otherwise, was maintained and is in good operating condition, except for ordinary wear and tear. To the Knowledge of Seller, all leased equipment included within the Assets was maintained in all material respects (either by Seller, the manufacturer or lessor, as the case may be) in accordance with manufacturer and lessor requirements, and is in good operating condition except for ordinary wear and tear.

3.09 Title to Personal Property.

Except as described on Schedule3.09, Seller owns and holds good, marketable and valid title or leasehold title, as the case may be, to all the Assets, other than the Real Property, free and clear of any Encumbrances. At Closing Seller will convey to Buyer good and valid title to all the Assets, other than the Real Property, free and clear of any Encumbrances.

3.10 Real Property.

Except as set forth on Schedule 3.10,

(a)Seller owns or holds good and marketable fee simple or leasehold title, as the case may be, to the Real Property together with all buildings, improvements and fixtures thereon and all appurtenances and rights thereto, free and clear of any Encumbrances other than the Permitted Encumbrances.

(b)At the Closing, Seller will convey to Buyer good and marketable fee simple or leasehold title, as the case may be, to all Real Property, free and clear of any Encumbrances other than the Permitted Encumbrances.

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(c)The Real Property comprises all of the real property owned or leased by Seller that is used by Seller in the operation of the Business.

(d)There are no pending or, to the Knowledge of Seller, threatened condemnation or similar proceedings or special assessments relating to the Real Property or any part thereof.

(e)There are no leases, subleases, licenses or other agreements, written or oral, granting to any party the right of use or occupancy of any portion of the Real Property.

(f)There are no outstanding options to purchase or rights of first refusal to purchase any Real Property.

(g)Seller has received all required approvals of Governmental Authorities (including, without limitation, Permits and certificates of occupancy or other such certificates permitting lawful occupancy of the Real Property) required in connection with Seller’s use of the Real Property and all improvements thereon, except where a failure to obtain such approvals would not individually or in the aggregate have a material adverse effect on the ownership or use of the Real Property, or the operation of the Business.

(h)With respect to Real Property leased or subleased by Seller:

(i)the lease or sublease is legal, valid, binding, enforceable and in full force and effect;

(ii)the lease or sublease shall continue to be legal, valid, binding, enforceable and in full force and effect on identical terms following the consummation of the Transaction;

(iii)no party to the lease or sublease is in breach or default, and no event has occurred which, with notice or lapse of time, would constitute a breach or default or permit termination, modification or acceleration thereunder;

(iv)no party to the lease or sublease has repudiated any provision thereof;

(v)there are no disputes, oral agreements, or forbearance programs in effect as to the lease or sublease;

(vi)Seller has not assigned, transferred, conveyed, mortgaged, deeded in trust, or encumbered any interest in the lease or sublease; and

(vii)all facilities leased or subleased thereunder have received all

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approvals of Governmental Authorities (including licenses and Permits) required in connection with the operation thereof have been operated and maintained in accordance with all applicable Legal Requirements.

3.11 Environmental Matters.

Except as disclosed in the Environmental Studies or as set forth on Schedule3.11, to the Knowledge of Seller:

(a)the Business is, and has been, in compliance with all applicable Environmental Laws, except where such failure to comply would not individually or in the aggregate have a material adverse effect on the ownership or use of the Assets.

(b)Seller has not received any Environmental Claim nor is there any basis for any Environmental Claim (including, without limitation, knowledge of any actions, activities, circumstances, conditions, events or incidents, including the release, emission, discharge or disposal of any Materials of Environmental Concern, whether relating to the Assets or the Business or otherwise).

(c)there is no existing contamination by, and there has not been any release by Seller of, any Materials of Environmental Concern on, at, under or around any of the Assets in connection with the Business which would result in any material adverse effect to Buyer.

(d)true, complete and correct copies of the written reports, and all parts thereof, of all environmental audits or assessments that have been conducted with respect to Seller or the Business, either by Seller or any environmental consultant or engineer engaged for such purpose, have been made available to Buyer, and a list of all such reports, audits and assessments and any other similar report, audit or assessment is included on Schedule3.11. Seller has provided Buyer with true, complete and correct copies of all environmental audits and assessments in the possession of Seller relating to any of the Assets or any Pre-Closing Environmental Matter.

(e)Seller has all Permits required under applicable Environmental Laws to own or lease its properties (including the Assets) and to conduct the Business thereon, except where failure to obtain such Permits would not have a material adverse effect on the ownership or use of the Assets, or otherwise result in any material adverse effect to Buyer. All Permits currently held by Seller pursuant to the Environmental Laws are identified on Schedule2.01(f).

(f)(i) all Materials of Environmental Concern are handled and disposed of in compliance with all applicable Environmental Laws, except where such failure to comply would not individually or in the aggregate have a material adverse effect on the ownership or use of the Assets or otherwise result in any material adverse effect to Buyer, (ii) there are no underground storage tanks located on the Real Property, (iii) there is no exposed friable asbestos contained in or forming part of any building, building

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component, structure or office space owned or leased by Seller and used in the conduct of the Business, and (iv) no polychlorinated biphenyls are used or stored at any Real Property owned or leased by Seller.

3.12 Intellectual Properties/Computer Software.

(a)Except as described on Schedule3.12(a), Seller owns or has the right to use pursuant to license, sublicense or other agreement free and clear of any liens, royalty or other payment obligations, the Intellectual Properties and all computer software, programs or similar systems (including data and related documentation) owned, leased or licensed by Seller necessary or desirable to the ownership or use of the Assets. Seller has taken all necessary and desirable action to maintain and protect the Intellectual Properties. All Intellectual Properties used or needed by Seller in the conduct of the Business, and all computer software, programs and similar systems owned, licensed or used by Seller in the conduct of the Business, to the Knowledge of Seller, are not in violation or infringement of, nor has Seller received any notice alleging any conflict with or violation or infringement of, any rights of any other Person with respect to any such Intellectual Properties or computer software, programs or similar systems.

(b)Schedule 3.12(b) identifies each patent or registration that has been issued to Seller with respect to any Intellectual Properties, identifies each pending patent application for registration that Seller has made with respect to any Intellectual Properties, and identifies each license, agreement or other permission that Seller has granted to any third parties with respect to any Intellectual Properties. Seller has delivered to Buyer correct and complete copies of all such patents, registrations, applications, licenses, agreements and permissions (as amended to date).

(c)Schedule 3.12(c) identifies all Intellectual Properties that any third party owns and that Seller uses pursuant to a license, sublicense, agreement or permission. Seller has delivered to Buyer true, correct and complete copies of all such licenses, sublicenses, agreements and permissions (as amended to date). With respect to each item of Intellectual Properties referenced in Section 3.12(c):

(i)the license, sublicense, agreement or permission covering the item is legal, valid, binding, enforceable and in full force and effect;

(ii)to the Knowledge of Seller, no party to the license, sublicense, agreement or permission is in breach or default, and no event has occurred that with notice or default permit termination, modification, or acceleration thereunder;

(iii)no party to the license, sublicense, agreement or permission has repudiated any provision thereof; and

(iv)Seller has not granted any sublicense or similar right with respect to the license, sublicense, agreement or permission.

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(d)To the Knowledge of Seller, no third party has interfered with, infringed upon, misappropriated or otherwise come into conflict with the Intellectual Properties of Seller.

3.13 Insurance.

Schedule 3.13 describes all insurance arrangements, including self-insurance, in place for the benefit of the Assets and the conduct of the Business for the last three years. True and correct copies of all such policies and any endorsements thereto have been made available to Buyer.

3.14 Permits and License.

Schedule 2.01(f) contains a complete and accurate list of all Permits and franchises (including applications therefor) owned or held by Seller relating to the ownership, development or operations of the Business or the Assets, all of which are in good standing and not subject to challenge. With respect to the Business, to the Knowledge of Seller, Seller is duly licensed by the appropriate Governmental Authorities, except where the failure to be so licensed would result in liabilities of less than Seventy-Five Thousand Dollars ($75,000) in the aggregate.

3.15 Agreements and Commitments.

(a)Schedule 3.15 is a true, complete and correct list of all Contracts (other than Immaterial Contracts and the Rejected Contracts) conforming to the descriptions set forth in this Section 3.15 to which Seller is a party, copies of each of which have been delivered or made available to Buyer:

(i)Contracts involving payments by or to Seller in excess of Seventy-Five Thousand Dollars ($75,000) or not made in the ordinary course of business;

(ii)any employee agreement or other Contract with any labor union covering employees of the Seller;

(iii)any option or other Contract to purchase or otherwise acquire or sell or otherwise dispose of any interest in any real property (including the Real Property);

(iv)any Contract under which Seller has agreed to indemnify any third party with respect to, or to share, the Tax liability of any third party;

(v)any Contract to make a capital expenditure or to purchase a capital asset in excess of Seventy-Five Thousand Dollars ($75,000) by or on behalf of Seller in connection with the Assets or the operation of the Business other than capital expenditures relating to assets that are to become part of a project;

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(vi)any Contract relating to the location of employees or minimum number of employees to be employed by Seller with respect to the Business;

(vii)any power of attorney (other than powers of attorney given in the ordinary course of the Business with respect to routine export, tax or securities matters);

(viii)any bond, indenture, note, loan or credit agreement (other than any credit agreements or arrangements between Seller and its members or any Affiliates) or other Contract relating to the borrowing of money or to the direct or indirect guarantee or assumption of the obligations of any other Person for borrowed money;

(ix)any Contract limiting or restricting in any material manner the operation of the Business;

(x)any lease or similar Contract under which (i) Seller is the lessee of, or holds or uses, any machinery, equipment, vehicle or other tangible personal property owned by any third Person for an annual rent in excess of Seventy-Five Thousand Dollars ($75,000) or (ii) Seller is the lessor of, or makes available for use by any third Person, any tangible personal property or real property owned by Seller for an annual rent in excess of Seventy-Five Thousand Dollars ($75,000);

(xi)except as set forth on Schedule 5.04, employment and severance Contracts, including Contracts (i) to employ or terminate executive officers or other personnel and other Contracts with present or former officers, directors or members of Seller or (ii) that will or could result in the payment by or the creation of any commitment or obligation (absolute or contingent) to pay on behalf of Buyer or Seller any severance, termination, “golden parachute,” or other similar payments to any present or former personnel following termination of employment or otherwise as a result of the consummation of the Transaction;

(xii)any joint venture or partnership Contracts;

(xiii)any Contract (including purchase orders) involving the obligation of Seller to purchase products or services pursuant to which the aggregate of payments to become due from Seller after the Effective Date is equal to or exceeds Seventy-Five Thousand Dollars ($75,000); and

(xiv)any agreement (or group of related agreements) for the purchase or sale of raw materials, commodities, supplies, products or other personal property, or for the furnishing or receipt of services, the performance of which shall extend over a period of more than one year, or involve consideration in excess of Seventy-Five Thousand Dollars ($75,000) ..

(b)Seller has made available to Buyer true, complete and correct copies of

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any Contract (including purchase orders) involving the obligation of Seller to purchase products or services pursuant to which the aggregate of payments to become due from Seller after the Effective Date is equal to or exceeds Seventy-Five Thousand Dollars ($75,000).

3.16 The Contracts.

Except as set forth on Schedule 3.16:

(i)the Assumed Contracts constitute lawful, valid and legally binding obligations of the Seller and are enforceable against Seller in accordance with their terms;

(ii)each Assumed Contract is in full force and effect and constitutes the entire agreement by and between the parties thereto;

(iii)each Assumed Contract shall continue to be legal, valid, binding, enforceable and in full force and effect on identical terms following the consummation of the Transaction;

(iv)no Assumed Contract prohibits or requires the consent of any Person to the assignment to and assumption by Buyer of the Assumed Contracts;

(v)no Assumed Contract will prohibit competition or restrict the ability of Buyer to engage in any lawful business after Closing;

(vi)no party to any Assumed Contract has repudiated any provision of any Assumed Contract; and

(vii)except as set forth in the Executory Contract Assumption and Assignment Order, the assignment of the Assumed Contracts to and assumption of such Assumed Contracts by Buyer will not result in any penalty, premium or variation of the rights, remedies, benefits or obligations of any party thereunder.

3.17 Employees and Employee Relations.

(a)Seller has made available to Buyer a complete list (as of December 31, 2000) of names, positions, current annual salaries or wage rates, and bonus and other compensation arrangements of all full-time and part-time employees of Seller (indicating in such list whether each employee is part-time or full-time, whether such employee is employed under written Contract, and, if such employee is not actively at work, the reason therefor).

(b)There is no pending or, to the Knowledge of Seller, threatened employee strike, work stoppage or slowdown or labor dispute. Except as described on Schedule 3.17(b), no employees of Seller are represented by a labor union or employee

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organization, and, to the Knowledge of Seller, (i) no union or employee organization has made a demand for recognition and (ii) no other union organizing or collective bargaining activities by or with respect to any employees of Seller are taking place.

3.18 Employee Benefit Plans.

(a)Schedule 3.18(a) lists each Employee Benefit Plan and Other Plan that Seller or any member of the Controlled Group that includes Seller sponsors or maintains or has within the last five (5) years sponsored or maintained or to which it contributes (including employee elective deferrals) or has within the last five (5) years contributed or been required to contribute.

(b)Seller, and no member of a Controlled Group that includes Seller, contributes to, ever has contributed to, or ever has been required to contribute to any Multiple Employer Plan or any Multiemployer Plan or has any liability (including withdrawal liability) under any Multiple Employer Plan or any Multiemployer Plan. No Seller, and no member of a Controlled Group that includes Seller, maintains or contributes, ever has maintained or contributed, or ever has been required to maintain or contribute to any Employee Welfare Benefit Plan providing medical, health or life insurance or other welfare-type benefits for current or future retired or terminated employees, their spouses or their dependents (other than in accordance with §4980B of the Code).

3.19 Litigation and Proceedings.

Except as set forth on Schedule 3.19 or as reflected in pleadings, proofs of claim or schedules filed in or in connection with the Bankruptcy Case, there are no claims, actions, suits, litigation, arbitration, mediations, investigations or other proceedings (including qui tam actions) pending or, to the Knowledge of Seller, threatened against Seller or the Assets.

3.20 Taxes.

(a)Seller has filed all Tax Returns required to be filed by or on behalf of Seller prior to the Effective Date. All such Tax Returns are correct and complete in all material respects and Seller has duly paid or made provision for the payment of all Taxes; and, as of Closing, there will be no Encumbrances on any Assets that arose in connection with any failure (or alleged failure) to pay any Tax.

(b)Except as described on Schedule 3.20(b), Seller has withheld proper and accurate amounts from its employees’ compensation in full and complete compliance with all withholding and similar provisions of the Code and any and all other applicable Legal Requirements, and has withheld and paid, or caused to be withheld and paid, all Taxes on monies paid by Seller to independent contractors, creditors and other Persons for which withholding or payment is required by applicable law.

(c)Schedule 3.20(c) lists all federal, state, local and foreign income Tax

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Returns filed with respect to Seller for the taxable periods ended on or after December 31, 1996. Seller has delivered to Buyer correct and complete copies of all federal income Tax Returns, examination reports and statements of deficiencies assessed against or agreed to by Seller since December 31, 1996.

(d)Schedule 3.20(d) sets forth the current income tax basis of Seller in the Assets.

3.21 Brokers and Finders.

Neither Seller nor any member, officer, director, employee or agent thereof, has engaged any finder or broker in connection with the Transaction, except that Seller has engaged Credit Suisse First Boston Corporation and Zolfo Cooper, LLC to act as Seller’s independent financial advisors in connection with the transactions contemplated by this Agreement.

3.22 Payments.

Seller has not, directly or indirectly, paid or delivered or agreed to pay or deliver any fee, commission or other sum of money or item of property, however characterized, to any Person that is in any manner related to the Assets or the Business in violation of any Legal Requirement. Neither Seller, nor any member, officer, director or employee of Seller has received or, as a result of the consummation of the Transaction contemplated by this Agreement, will receive any rebate, kickback or other improper or illegal payment from Person with whom Seller conducts or has conducted business.

3.23 Customer List.

Seller has provided to Buyer a true, complete and correct list of all customers of Seller since January 1, 1998 that generated revenues in excess of Five Hundred Thousand Dollars ($500,000) in any fiscal year during such period.

3.24 Compliance with Legal Requirements.

Except as set forth on Schedule 3.24, to the Knowledge of Seller, Seller has complied with all applicable Legal Requirements and no action, suit, proceeding, hearing, investigation, charge, complaint, claim, demand or notice has been filed or commenced against Seller alleging failure to so comply.

4. REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer hereby represents and warrants to Seller that the statements contained in Article 4 are correct and complete as of the Effective Date and, except where expressly limited to a specific date, shall be correct and complete as of the Closing Date:

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4.01 Organization.

Buyer is a limited liability company duly organized and validly existing in good standing under the laws of the State of Delaware.

4.02 Powers; Consents; Absence of Conflicts.

Buyer and Guarantor have the requisite power and authority to enter into this Agreement, and to perform its obligations hereunder. The execution, delivery and performance by Buyer and Guarantor of this Agreement and the consummation of the Transaction by Buyer:

(a)are within Buyer’s corporate powers and are not in contravention of any Legal Requirement or the term of its certificate of formation or operating agreement, each as amended to date, and have been approved by all requisite corporate action;

(b)except as otherwise expressly provided in this Agreement or as set forth on Schedule 4.02(b), do not require any approval or consent of, or filing with, any Governmental Authority;

(c)do not conflict with or result in any breach or contravention of, any material agreement to which Buyer is a party or by which it is bound; and

(d)do not violate any Legal Requirement to which Buyer may be subject.

4.03 Binding Agreement.

This Agreement and all instruments and agreements hereunder to which Buyer is or becomes a party are (or upon execution will be) valid and legally binding obligations of Buyer enforceable against Buyer in accordance with the respective terms hereof and thereof, except as enforceability against Buyer may be restricted, limited or delayed by applicable bankruptcy or other laws affecting creditors’ rights generally and except as enforceability may be subject to general principles of equity.

4.04 Brokers and Finders.

Neither Buyer, nor any Affiliate of Buyer, nor any officer, director, employee or agent thereof, has engaged any finder or broker in connection with the transactions contemplated hereunder.

4.05 Payments.

Neither Buyer nor any Affiliate of Buyer nor any officer, director, employee or agent thereof, has, directly or indirectly, paid or delivered, offered to pay or deliver, or agreed to pay or deliver any fee, commission or other sum of money or item of property, however characterized, to any person that is now or was previously an affiliate or insider (as those terms are defined in

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the Bankruptcy Code) of Seller.

4.06 Adequate Assurance.

Buyer has available to it all amounts necessary to allow Buyer to pay the Purchase Price in cash on the Closing Date.

5. COVENANTS AND AGREEMENTS OF THE PARTIES

5.01 Filing of Sale Motion; Entry of Buyer Protection and Bidding Procedures Order; Additional Seller.

Promptly following, but no later than five (5) Business Days after the Effective Date, Seller shall file the Sale Motion and such other motions as are necessary to implement the Transaction. Seller shall request a prompt hearing relative to, and shall use its best efforts to obtain, entry of the Buyer Protection and Bidding Procedures Order. From and after the Effective Date, to the extent that any Affiliates of Seller acquires, owns or holds any portion of the Assets or conducts any portion of the Business and initially is not a Party hereto, Seller shall cause each such Affiliate to become a Party as an additional Seller.

5.02 Operations.

From the Effective Date until the Closing Date, except as otherwise expressly provided in this Agreement (including Section 5.03) and subject to the obligations of Seller to comply with any applicable Order of the Bankruptcy Court and the provisions of the Bankruptcy Code, Seller will:

(a)perform when due all Legal Requirements and obligations under Contracts (including the Assumed Contracts) relating to or affecting the Assets or the Business;

(b)carry on the Business in substantially the same manner as it has on the Effective Date;

(c)maintain the Assets in the same condition as the Assets were maintained as of the Effective Date;

(d)take all actions necessary and appropriate to deliver to Buyer title to the Assets free and clear of all Encumbrances (other than Permitted Encumbrances) pursuant to the Sale Order and cooperate with Buyer to obtain appropriate releases, consents, estoppels, certificates and other instruments as Buyer may reasonably request;

(e)keep in full force and effect present insurance policies or other comparable insurance benefiting the Assets and the conduct of the Business;

(f)maintain and preserve its status as a limited liability company; and

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(g)at the request of Buyer, permit and allow reasonable access by Buyer to discuss and make offers of post-closing employment with any of Seller’s personnel, to advertise for post-Closing employment at the Business, and to establish, preserve and maintain relationships with contractors, subcontractors, suppliers and other Persons having business relations with Seller.

5.03 Certain Actions.

From the Effective Date until the Closing Date, except as otherwise expressly provided in this Agreement, as set forth on Schedule 5.03 or as required by the Bankruptcy Court, Seller shall not take any of the following actions without first obtaining the written consent of Buyer (which consent shall not be unreasonably withheld):

(a)amend or terminate any Assumed Contract, or enter into any Contract involving a commitment on the part of Seller in excess of Seventy-Five Thousand Dollars ($75,000); or

(b)sell, assign, transfer, distribute or otherwise transfer or dispose of any property, plant or equipment of Seller having an original cost in the aggregate in excess of Seventy-Five Thousand Dollars ($75,000) .

5.04 Employee Matters.

(a)Nothing contained in this Agreement shall confer upon any employee of Seller any right with respect to continued employment by Buyer.

(b)Seller shall be responsible for and pay any and all liabilities or obligations arising under the WARN Act, if any, arising out of or resulting from layoffs of employees prior to Closing and/or the consummation of the Transaction, and Seller shall remain liable for any and all costs and expenses associated with continued employment, or termination and severance, including any obligation imposed on Seller to provide such employees with continued health, disability, life, retirement or other benefits (whether covered by insurance or not).

(c)Buyer shall not assume any liability or obligation of Seller with respect to or in favor of any employees of Seller.

5.05 Access to and Provision of Additional Information.

(a)From the Effective Date until January 11, 2001 (“Initial Due Diligence Period”), Buyer may, pursuant to the procedure established in Section 5.05(b), perform Buyer’s due diligence investigation of the assets, Contracts, rights, liabilities and obligations of Seller and the Business.

(b)From the Effective Date until the Closing Date, Seller shall cooperate fully with Buyer and Buyer’s representatives in connection with Buyer’s due diligence

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investigation of the business, Assets, Contracts, rights, liabilities and obligations of Seller and the Business, and shall provide to Buyer and Buyer’s representatives full and complete access to and the right to inspect the Business, any facilities associated with or used in the Business, the Assets, books and records of Seller relating to Seller, the Assets and the Business, and will furnish to Buyer all material information concerning Seller, the Assets and the Business not otherwise disclosed pursuant to this Agreement, all pleadings and other documents or schedules filed with the Bankruptcy Court, access to Seller’s files and other records regarding claims, actions, suits, litigation, arbitration, mediations, investigations and other proceedings pending against or otherwise affecting Seller, the Assets or the Business, and such additional financial, operating and other data and information regarding the Business as Buyer may from time to time reasonably request, without regard to where such information may be located. In addition, Seller shall use its reasonable best efforts to cause its agents, representatives, remaining employees, officers, directors, vendors, suppliers and customers to cooperate with Buyer and Buyer’s representatives in connection with Buyer’s due diligence review as it relates to any Contracts between any such vendors, suppliers and customers and Seller.

(c)From the Effective Date until the Closing Date, Seller shall use its reasonable best efforts to cause its officers and remaining employees to confer on a regular and frequent basis with one or more representatives of Buyer and to answer Buyer’ s questions regarding matters relating to the conduct of the Business and the status of the Transaction. Seller shall notify Buyer in writing of any material changes in the operations or financial condition of the Business and the status of the Bankruptcy Case and shall keep Buyer reasonably informed of such matters.

(d)Buyer agrees that it will not, in the exercise by Buyer of any right of access granted herein, interfere with the business operations of Seller.

(e)Except as provided in Article 8, each Party shall be responsible for its own costs and expenses incurred pursuant to this Section 5.05.

5.06 Post-Closing Maintenance of and Access to Information.

(a)The parties acknowledge that after Closing each party may need access to information or documents in the control or possession of the other party for the purposes of concluding the transactions herein contemplated, Tax Returns or audits, the Assumed Contracts and other Legal Requirements, and the prosecution or defense of third party claims. Accordingly, each party shall keep, preserve and maintain in the ordinary course of business, and as required by Legal Requirements and relevant insurance carriers, all books, records, documents and other information in the possession or control of such party and relevant to the foregoing purposes for a period of five (5) years. Notwithstanding the foregoing, neither party shall destroy or otherwise dispose of any of the items referenced in this Section 5.06(a) unless the party seeking to destroy or dispose of such items provides sixty (60) days’ prior written notice to the other party of the intent to seek or destroy such items and affords such other party an opportunity to copy or otherwise remove such items.

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(b)Each party shall cooperate fully with, and make available for inspection and copying by, the other party, its employees, agents, counsel and accountants and/or Governmental Authorities, upon written request and at the expense of the requesting party, such books, records, documents and other information to the extent reasonably necessary to facilitate the foregoing purposes. Such cooperation shall include, without limitation, the on-site and off-site inspection of any equipment or components by experts, engineers, attorneys and other agents of the parties during normal business hours and upon reasonable prior notice. In addition, each party shall cooperate with, and shall permit and use its best efforts to cause, at the expense of the requesting party, its respective former and present member, directors, officers and employees to cooperate with the other party on and after Closing in furnishing information, evidence, testimony and other assistance in connection with any action, proceeding, arrangement or dispute of any nature with respect to the subject matters of this Agreement and pertaining to periods prior to the Closing Date.

(c)Seller shall be entitled to remove from the Business, at Seller’s sole risk and expense, any records that relate to events or periods prior to Closing for purposes of pending litigation involving matters to which such records refer, as certified in writing prior to removal by counsel retained by Seller in connection with such litigation; provided, however, that Seller shall at its expense arrange to have copies made of any such records designated by Buyer prior to their removal, which copies shall remain at the Business. Seller shall promptly return any records so removed to Buyer following their use.

(d)The exercise by either party of any right of access granted herein shall not materially interfere with the business operations of the other party.

5.07 Governmental Authority Approvals; Consents to Assignment.

(a)From the Effective Date until the Closing Date, Seller and Buyer shall (i) promptly apply for and use their respective commercially reasonable efforts to obtain prior to Closing all consents, approvals, authorizations and clearances of Governmental Authorities and third parties required of it to consummate the Transaction (including the assignment of the Assumed Contracts), (ii) provide such information and communications to Governmental Authorities as the other party or such Persons may reasonably request, and (iii) assist and cooperate with other party to obtain all Permits and clearances of Governmental Authorities that the other party reasonably deems necessary or appropriate, and to prepare any document or other information reasonably required of it by any such Persons to consummate the Transaction; provided, however, that, notwithstanding the foregoing, no party shall have any obligation under such provisions (x) to pay any cash amounts to Governmental Authorities other than filing fees, or (y) to agree to divest assets or limit the operations of its businesses.

(b)From the Effective Date until the Closing Date, each of the parties shall file, if and to the extent required by law, all reports or other documents required or

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requested by Governmental Authorities under the HSR Act concerning the purchase and sale of the Assets and comply promptly with any requests by the Governmental Authorities for additional information concerning the purchase and sale of the Assets, so that the waiting period specified in the HSR Act with respect to those Assets will expire as soon as reasonably possible after the Effective Date. Each of the parties shall furnish to the other parties such information as the other parties reasonably require to perform their obligations under the HSR Act and shall exchange drafts of the relevant portions of each other’s report forms prior to filing. Notwithstanding any provision herein to the contrary, Seller and Buyer shall share equally any filing fees required to be paid in connection with the HSR Act filings and compliance by the Parties.

(c)Seller, with Buyer’s cooperation, shall use its best efforts to obtain Bankruptcy Court approval of the assumption by and assignment to Buyer of the Assumed Contracts and Seller and Buyer shall use their respective best efforts to obtain all other consents and approvals required to assign the Assumed Contracts to Buyer.

(d)In the event that any and all transfers or other agreements, consents, approvals or waivers necessary for the assignments or transfer of any Assumed Contracts, or any claim, right or benefit arising thereunder or resulting therefrom, shall not have been obtained prior to the Closing Date, then, at the election of Buyer in its sole and absolute discretion, as of the Closing, this Agreement, to the extent permitted by law, shall constitute full and equitable assignment by Seller to Buyer of all of Seller’s right, title and interest in and to, and all of Seller’s obligations and liabilities under, such Assumed Contracts, and Buyer shall be deemed Seller’s agent for the purpose of completing, fulfilling and discharging all of Seller’s liabilities under any such Assumed Contracts. The Parties shall take all necessary steps and actions to provide Buyer with the benefits of such Assumed Contracts, and to relieve Seller of the performance and other obligations thereunder, including entry into subcontracts for the performance thereof. Buyer agrees to pay, perform and discharge, and indemnify Seller against and hold Seller harmless from, all obligations and liabilities of Seller relating to such performance or failure to perform under such Assumed Contracts after the Closing Date.

(e)In the event Seller shall be unable to make the equitable assignment described in Section5.07(d), or if such attempted assignment would give rise to any right of termination, or would otherwise adversely affect the rights of Seller or Buyer under such Assumed Contracts, or would not assign all Seller’s rights thereunder at the Closing, Seller and Buyer shall continue to cooperate and use all reasonable efforts to provide Buyer with all such rights. To the extent that any such consents and waivers are not obtained, or until the impediments to such assignment are resolved, Seller shall use all reasonable efforts (without the expenditure, in the aggregate, of any material sum) to (i) provide to Buyer, at the request of Buyer, the benefits of any such Assumed Contract to the extent related to the Business or the Assets, (ii) cooperate in any lawful arrangement designed to provide such benefits to Buyer and (iii) enforce, at the request of, for the account of and at the sole cost of Buyer, any rights of Seller arising from any such Assumed Contracts against any third Person (including any Governmental Authority) including the right to elect to terminate in accordance with the terms thereof

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upon the advice of Buyer. To the extent that Buyer is provided the benefits of any Assumed Contract referred to herein (whether from Seller or otherwise), Buyer shall perform at the reasonable direction of Seller and for the benefit of any third Person (including any Governmental Authority) the obligations of Seller thereunder or in connection therewith, and Buyer agrees to pay, perform and discharge, and indemnify Seller against and hold Seller harmless from, all obligations and liabilities of Seller relating to such performance or failure to perform, after the Closing Date.

5.08 Allocation of Purchase Price for Tax Purposes.

Seller and Buyer agree that, for income tax purposes, the Purchase Price shall be allocated among the Assets as Buyer may determine, in accordance with their fair market values consistent with §1060 of the Code, and such allocation shall be binding upon the parties for all applicable federal, state, local and foreign Tax purposes. Seller and Buyer covenant to report gain or loss or cost basis, as the case may be, in a manner consistent with such allocation on all Tax Returns filed by any of them after Closing and not to voluntarily take any inconsistent position therewith in any administrative or judicial proceeding relating to such returns. Seller and Buyer shall exchange mutually acceptable and completed IRS Forms 8594 (including supplemental forms, if required), which they shall use to report the transaction contemplated hereunder to the Internal Revenue Service in accordance with such allocation. Notwithstanding anything to the contrary, no allocation hereunder shall supersede or otherwise usurp the jurisdiction of the Bankruptcy Court to value the assets for purposes of distribution to the respective Debtors’ estates under the Bankruptcy Code.

5.09 Further Acts and Assurances.

At any time and from time to time at and after the Closing, upon request of Buyer, Seller shall do, execute, acknowledge and deliver, or cause to be done, executed, acknowledged and delivered, such further acts, deeds, assignments, transfers, conveyances, powers of attorney, confirmations and assurances as Buyer may reasonably request to more effectively convey, assign and transfer to and vest in Buyer, its successors and assigns, full legal right, title and interest in and actual possession of the Assets and the Business and to generally carry out the purposes and intent of this Agreement. Seller shall also furnish Buyer with such information and documents in its possession or under its control, or that such Seller can execute or cause to be executed, as will enable Buyer to prosecute any and all petitions, applications, claims and demands relating to or constituting a part of the Assets and the Business.

5.10 Costs and Expenses.

(a)Except for the Expense Reimbursement or as otherwise expressly set forth in this Agreement, all expenses of the negotiation and preparation of this Agreement and related to the Transaction, including legal counsel, accounting, brokerage and investment advisor fees and disbursements, shall be borne by the respective Party incurring such expense, whether or not the Transaction is consummated. Seller shall be responsible for paying any allowed fees and expenses of Credit Suisse First Boston Corporation and Zolfo Cooper, LLC in connection with the transactions contemplated by this Agreement.

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(b)Buyer shall pay the cost of Buyer’s owner’s title insurance policies and Seller shall pay the cost of removing Encumbrances that are not Permitted Encumbrances. Buyer shall pay the cost of Buyer’s land title surveys of the Real Property, and environmental, engineering and other professional studies undertaken by Buyer.

5.11 Insurance Ratings.

From the Effective Date until the Closing Date, Seller will take all actions reasonably requested by Buyer to enable Buyer to succeed to the Workers’ Compensation and Unemployment Insurance ratings, insurance policies and other interests of Seller and the Business for insurance or other purposes. Buyer shall not be obligated to succeed to any such rating, insurance policy, deposit or other interest, except as it may elect to do so.

5.12 Fulfillment of Conditions.

Each party will execute and deliver at Closing each agreement, instrument or other document that such party is required by this Agreement to execute and deliver as a condition to Closing, and will take all commercially reasonable steps necessary or desirable and proceed diligently and in good faith to satisfy each other condition to the obligations of the parties contained in this Agreement, to the extent that satisfaction of such condition is within the control of such party.

5.13 Release of Encumbrances.

Seller’s obligation to deliver the Assets free and clear of any Encumbrances (other than Permitted Encumbrances) shall be limited to its efforts to obtain the Sale Order that provides for the delivery of the Assets free and clear of any Encumbrances. In the event Buyer desires to have any Encumbrances released and discharged other than by means of the Sale Order, Buyer, at its sole cost, shall obtain such releases or discharges.

5.14 Assumed and Assigned Contracts; Rejected Contracts.

(a)Assumed Contracts. Subject to the approval of the Bankruptcy Court and pursuant to the Executory Contract Assumption and Assignment Order, the Assumed Contracts will be assumed by Seller and assigned to Buyer or Buyer’s designee on the Closing Date under §365 of the Bankruptcy Code. Seller shall, consistent with the Bankruptcy Case and pursuant to any order of the Bankruptcy Court, use its best efforts to promptly comply with and perform any obligations under the Assumed Contracts arising from and after the Effective Date and through the Closing Date. In the Sale Motion, or in such additional or subsequent motions as may be appropriate, Seller will seek authority to assume and assign the Assumed Contracts to Buyer (or Buyer’s Designee) in accordance with §365 of the Bankruptcy Code. All Assumed Contracts shall be assigned to and assumed by Buyer (or Buyer’s designee) at Closing. Subject to the following right of Seller to reject any Contract, the final determination of which

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Contracts Seller will assume and assign to Buyer shall be within the sole discretion of Buyer and Buyer shall be responsible for curing all defaults with respect to any Assumed Contracts.

(b)Rejected Contracts. Schedule 5.14(b) will be delivered by Seller on or prior to the Schedule Delivery Date and will contain an initial schedule of Rejected Contracts. On or prior to one (1) day prior to the Bid Deadline, Buyer may by written notice to Seller designate additional Contracts as Rejected Contracts to be included in an amended Schedule 5.14(b). Upon any such amendment to Schedule 5.14(b), Schedule 2.01(e) shall be amended accordingly. Subsequent to the Bankruptcy Court’s entry of the Buyer Protection and Bidding Procedures Order and prior to Closing, Seller shall consult with Buyer about any Rejected Contract Seller seeks to reject and consider in good faith Buyer’s opinions on any such rejection, in recognition of Buyer’s bona fide interest in preserving to the maximum extent possible the Contracts that Buyer believes are reasonably necessary to the continued operation and financial viability of the Business after Closing, but Seller shall have the right in its discretion to reject any Contract other than any Assumed Contract that in its judgment Seller believes must be rejected to maintain the viability of the Business prior to the Closing Date or to comply with any order of the Bankruptcy Court. In addition, subject to the approval of the Bankruptcy Court and after receipt of Buyer’s prior written consent (which shall not be unreasonably withheld) Seller may assume any Rejected Contract if the total cost of completing such Rejected Contract would be materially less costly than the reasonably anticipated damages that would be payable by Seller in connection with a claim for material breach of such Rejected Contract. In the event that Seller should assume any such Rejected Contract, Buyer shall, to the extent permitted by Legal Requirements, grant to Seller a non-exclusive, royalty-free license to use or exploit those items constituting Intellectual Properties as may be reasonably necessary to perform such Rejected Contract assumed by Seller pursuant to this Section5.14(b) and the Completed Contracts.

5.15 Bankruptcy Court Approval.

(a)Seller shall use its best efforts to obtain Bankruptcy Court approval of the Sale Order which, among other things, will contain findings of fact and conclusions of law (i) finding that this Agreement was proposed by the Parties in good faith and represents the highest and best offer for the Assets and should be approved; (ii) finding that Buyer is a good faith purchaser and is entitled to the protections of § 363(m) of the Bankruptcy Code and that the provisions of § 363(n) of the Bankruptcy Code have not been violated; (iii) authorizing and directing Seller to enter into this Agreement and sell only the Assets to Buyer pursuant to this Agreement and §§ 363 and 365 of the Bankruptcy Code, free and clear of all liens, claims, interests, liabilities and Encumbrances (including any and all “interests” in the Assets within the meaning of § 363(f) of the Bankruptcy Code), other than the Assumed Liabilities and the Permitted Encumbrances, such that Buyer shall not incur any liability as a successor to the Business; (iv) authorizing and directing Seller to execute, deliver, perform under, consummate and implement, this Agreement, together with all additional instruments and documents that may be reasonably necessary or desirable to implement the foregoing;

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(v) finding that Buyer is not a successor in interest to Seller; (vi) finding that Buyer is not otherwise liable for Excluded Liabilities; (vii) finding that Buyer’s acquisition of the Assets and assumption of the Assumed Liabilities does not reflect a significant continuity of the business of the Debtor and permanently enjoins each and every holder of an Excluded Liability from commencing, continuing or otherwise pursuing or enforcing any remedy, claim or cause of action against Buyer relative to such Excluded Liability; (viii) finding that the sale of the Assets does not constitute a sub rosa plan of reorganization; and (ix) directing the Seller, at the direction of the Buyer, to immediately consummate the sale of the Assets without awaiting the expiration of any applicable time period for appealing the Sale Order; and (x) abrogating the ten day stay otherwise provided by Bankruptcy Rules 6004 and 6006.

(b)Seller shall use its best efforts to obtain Bankruptcy Court approval of the Executory Contract Assumption and Assignment Order.

(c)Seller shall use its best efforts to obtain Bankruptcy Court approval of the Buyer Protection and Bidding Procedures Order which, among other things, (i) approves and makes binding the Seller’s entry into this Agreement, (ii) approves the Break-Up Fee, Termination Fee and Expense Reimbursement, (iii) provides that Buyer’s claim to the Break-Up Fee, Termination Fee and Expense Reimbursement shall, in the event the Seller elects to pursue a Stand Alone Plan, be entitled to superpriority administrative claim treatment in the Bankruptcy Case, senior to all other superpriority claims, and in the event the Seller elects to sell the Assets to a Qualified Bidder, constitute a first priority lien against and be paid out of the proceeds of the sale to such Qualified Bidder, (iv) establishes a date by which initial Qualified Bids must be submitted, (v) establishes the Sale Hearing procedures for an auction at which only Qualified Bidders who have previously submitted a Qualified Bid may bid, (vi) sets the Minimum Incremental Bid Amount at Three Million Four Hundred Thousand Dollars ($3,400,000) Cash for the initial incremental bid and Two Million Dollars ($2,000,000) Cash for any additional incremental bids and (vii) requires Seller to promptly provide a copy of any Qualified Bid to Buyer and to any Qualified Bidder who has submitted a Qualified Bid.

(d)Seller shall promptly make any filings, take all actions, and use its best efforts to obtain any and all other approvals and orders necessary or appropriate for consummation of the Transaction, subject to its obligations to comply with any order of the Bankruptcy Court.

(e)In the event an appeal is taken, or a stay pending appeal is requested, from the Sale Order, the Executory Contract Assumption and Assignment Order or the Buyer Protection and Bidding Procedures Order, Seller shall immediately notify Buyer of such appeal or stay request and shall provide to Buyer within one (1) Business Day a copy of the related notice of appeal or order of stay. Seller shall also provide Buyer with written notice of any motion or application filed in connection with any appeal from either of such orders.

(f)Buyer shall cooperate in providing such information and evidence as is

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necessary to obtain the orders described in this Section 5.15.

5.16 Transfer Taxes.

In accordance with §1146(c) of the Bankruptcy Code, the making or delivery of any instrument of transfer, including the filing of any deed or other document of transfer to evidence, effectuate or perfect the rights, transfers and interest contemplated by this Agreement, shall be in contemplation of a plan or plans of reorganization to be confirmed in the Bankruptcy Case, and as such shall be free and clear of any and all stamp tax or similar taxes. If the Sale Order so provides, Seller shall use its best efforts to ensure that the instruments transferring the Assets to Buyer shall contain the following endorsement:

“Because this (instrument) has been authorized pursuant to Order of the United States Bankruptcy Court for the District of Delaware, in contemplation of a plan of reorganization of the Grantor, it is exempt from any law imposing a stamp tax or similar tax pursuant to 11 U.S.C. §1146(c).”

In the event real estate transfer Taxes are required to be paid in order to record the deeds to be delivered to Buyer in accordance herewith, or in the event any such Taxes are assessed at any time thereafter, such real estate transfer Taxes incurred as a result of the transactions contemplated hereby shall be paid by Buyer. In the event sales, use or other transfer Taxes are assessed at Closing or at any time thereafter on the transfer of any other Assets, such Taxes incurred as a result of the transactions contemplated hereby shall be paid by Buyer.

5.17 Non-Solicitation.

From and after the Effective Date, neither Seller nor any of their respective members, directors, employees, accountants, attorneys, or other agents or representatives shall directly or indirectly solicit or enter into discussions regarding a Competing Proposal; provided, however, that notwithstanding the foregoing, after entry of the Buyer Protection and Bidding Procedures Order, Seller shall be entitled to give such notice of the Buyer Protection and Bidding Procedures Order as the Bankruptcy Court requires to respond to and discuss any Competing Proposals from a Qualified Bidder, to provide information, including due diligence materials, to Qualified Bidders and to negotiate and discuss any Qualified Bid or as required to allow Seller to satisfy its fiduciary duties in accordance with the advice of Seller’s counsel, provided, further, however, that Seller shall provide Buyer with copies of all Competing Proposals and other related communications received from third parties within one Business Day after Seller’s receipt thereof.

5.18 Guaranty of Buyer’s Obligations.

Guarantor irrevocably and unconditionally guaranties the performance of Buyer’s obligations under this Agreement and payment of the Deposit, Purchase Price and any other amounts payable by Buyer to Seller under the terms of this Agreement that are not paid by Buyer when due.

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6. CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER

The obligations of Seller hereunder are subject to the satisfaction on or prior to the Closing Date of the following conditions unless waived in writing by Seller:

6.01 Representations and Warranties; Covenants.

(a)Each of the representations and warranties of Buyer contained in this Agreement shall be true and correct in all material respects on and as of the Effective Date and, except where expressly limited to a specific date, on and as of the Closing Date.

(b)Each and all of the terms, covenants and agreements to be complied with or performed by Buyer on or before the Closing Date shall have been complied with and performed in all material respects, including the obligations of Buyer in Section8.03.

6.02 Adverse Actions or Proceedings.

No Governmental Authority shall have taken any action or made any request of Seller or Buyer as a result of which Seller reasonably and in good faith deems it inadvisable to proceed with the Transaction, and there shall not be in effect any order restraining, enjoining or otherwise preventing consummation of the Transaction; provided that the parties shall have used their respective reasonable best efforts to cause any such order to be vacated or lifted.

6.03 Pre-Closing Confirmations.

Seller shall have obtained documentation or other written evidence reasonably satisfactory to Seller that Seller and Buyer have received or will receive all consents, approvals, authorizations and clearances of Governmental Authorities required of it to consummate the transactions contemplated hereby and that all applicable waiting periods under the HSR Act have expired.

7. CONDITIONS PRECEDENT TO OBLIGATIONS OF BUYER

The obligations of Buyer hereunder are subject to the satisfaction on or prior to the Closing Date of each of the following conditions, unless waived in writing by Buyer:

7.01 Representations and Warranties; Covenants.

(a)Each of the representations and warranties of Seller contained in this Agreement shall be true, complete and correct in all material respects on and as of the Effective Date and, except where expressly limited to a specific date, on and as of the Closing Date.

(b)Each and all of the terms, covenants and agreements to be complied with

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or performed by Seller on or before the Closing Date shall have been complied with or performed in all material respects, including the obligations of Seller in Section 5.18 and Section 8.02.

7.02 Pre-Closing Confirmations and Contractual Consents.

Buyer shall have obtained or received from Seller documentation or other evidence reasonably satisfactory to Buyer that:

(a)Seller and Buyer have received all consents, permits, approvals, authorizations and clearances of Governmental Authorities required to consummate the transactions herein contemplated;

(b)the Sale Order, Executory Contract Assumption and Assignment Order and the Buyer Protection and Bidding Procedures Order have been entered by the Bankruptcy Court and have become Final Orders, unless Buyer, in its sole discretion, waives the requirement that one or more of these Orders be a Final Order;

(c)Buyer has obtained such other consents and approvals as may be legally or contractually required for Buyer’s consummation of the transactions described herein;

(d)Seller, at Buyer’s expense, shall have cured all defaults (whether monetary or non-monetary) under the Assumed Contracts; and

(e)all applicable waiting periods under the HSR Act have expired.

7.03 Adverse Actions or Proceedings.

No Governmental Authority shall have taken any action or made any request of Seller or Buyer as a result of which Buyer reasonably and in good faith deems it inadvisable to proceed with the Transaction; and there shall not be in effect any order restraining, enjoining or otherwise preventing consummation of the Transaction; provided that the parties shall have used their respective reasonable best efforts to cause any such order to be vacated or lifted.

7.04 Deliveries at Closing.

Seller shall have delivered to Buyer, in form reasonably acceptable to Buyer and approved by Buyer’s counsel, deeds, bills of sale, assignments or other instruments of transfer, and estoppels, consents and waivers by others, necessary or appropriate to transfer to and effectively vest in Buyer the Assets and all agreements, instruments, certificates or other documents contemplated or required to be executed by Seller pursuant to this Agreement.

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8. CLOSING; TERMINATION OF AGREEMENT

8.01 Closing.

(a)Consummation of the sale and purchase of the Assets and the Business and the other transactions contemplated by and described in this Agreement (the “Closing”) shall take place at the offices of Moore & Van Allen PLLC, Suite 4700, 100 North Tryon Street, Charlotte, North Carolina 28202 at 10:00 A.M. on the second Business Day following satisfaction or waiver of the conditions set forth in Article 6 and Article 7, or at such time or place as the parties may mutually agree. Unless otherwise agreed in writing by the parties at Closing, the Closing shall be effective for accounting purposes as of 12:01 A.M. on the day following the Closing Date.

(b)No later than ten (10) days prior to Closing, Buyer may designate one or more Affiliates to take title to the Assets, and references to instruments or agreements to be executed and delivered to or by Buyer in this Agreement at Closing shall apply to each such designee with respect to the Assets acquired by it. Buyer shall notify Seller prior to Closing of the names of such designees and, from and after Closing, the rights, privileges and benefits of this Agreement applicable to Buyer shall benefit each such designee, subject to the terms, covenants and conditions of this Agreement, with respect to the Assets acquired by it.

8.02 Action of Seller at Closing.

At the Closing unless otherwise waived in writing by Buyer, Seller shall deliver:

(a)to Buyer deeds containing special warranties of title and where applicable assignments of lease, in form and substance reasonably acceptable to Buyer, fully executed by Seller in recordable form, conveying to Buyer good and marketable fee title to the owned Real Property and valid leasehold title to the leased Real Property, free and clear of all Encumbrances other than the Permitted Encumbrances;

(b)to Buyer bills of sale and assignment, fully executed by Seller, in form and substance reasonably acceptable to Buyer, conveying to Buyer good and valid title to all Assets other than the Real Property, free and clear of all Encumbrances;

(c)to Buyer assignments, fully executed by Seller, in form and substance acceptable to Buyer, conveying Seller’s interests in the Assumed Contracts to Buyer;

(d)to Buyer copies of resolutions or equivalent instruments duly adopted by the governing body of Seller and, if required, the partners or members of Seller, authorizing and approving the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby, certified as true and in full force and effect as of the Closing Date by the appropriate officers, members or partners of Seller;

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(e)to Buyer certificates of the duly authorized President or Vice President or similar officer of Seller certifying that, except where expressly limited to a specific date, each of the representations and warranties of Seller contained in this Agreement is true and correct on and as of the Closing Date in all material respects, and that each and all of the terms, covenant and agreements to be complied with or performed by Seller on or before the Closing Date have been complied with and performed in all material respects;

(f)to Buyer certificates of incumbency or evidence of appropriate power of attorney for the respective directors or officers of Seller executing the Agreement and other Closing documents, dated as of the Closing Date;

(g)to Buyer a certificate of good standing from the jurisdiction in which Seller is organized, dated within thirty (30) days prior to the Closing Date; and

(h)to Buyer such other instruments, agreements, certificates and documents as Buyer reasonably deems necessary to effect the Transaction.

8.03 Action of Buyer at Closing.

At the Closing and unless otherwise waived in writing by Seller, Buyer shall deliver:

(a)to Seller the Purchase Price;

(b)to Seller an assumption agreement, fully executed by Buyer, in form and substance reasonably acceptable to Seller, pursuant to which Buyer shall assume the future payment and performance of the Assumed Liabilities;

(c)to Seller copies of resolutions duly adopted by the governing body of Buyer authorizing and approving Buyer’s execution and delivery of this Agreement and the Transaction, certified as true and in full force and effect as of the Closing Date by an appropriate officer of Buyer,

(d)to Seller certificates of the duly authorized President or a Vice President of Buyer certifying that, except as expressly limited to a specific date, each of the representations and warranties of Buyer contained in this Agreement is true and correct on and as of the Closing Date in all material respects, and that each and all of the terms, covenants and agreements to be complied with or performed by Buyer on or before the Closing Date have been complied with and performed in all material respects;

(e)to Seller certificates of incumbency for the officers of Buyer executing this Agreement and other Closing documents, dated as of the Closing Date;

(f)to Seller certificates of existence and good standing of Buyer from the jurisdiction in which it is incorporated, dated within thirty (30) days prior to the Closing Date; and

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(g)to Seller such other agreements, instruments and documents as Seller reasonably deems necessary to effect the Transaction.

8.04 Termination Prior to Closing; Break-Up Fee; Expense Reimbursement; Other Compensation.

(a)Notwithstanding anything herein to the contrary, this Agreement may be terminated, and the transactions contemplated by this Agreement abandoned, upon notice by the terminating party to the other parties:

(i)at any time before the Closing, by mutual consent of Buyer and Seller, without penalty or payment;

(ii)at any time prior to the entry of the Buyer Protection and Bidding Procedures Order, by either party without penalty or payment;

(iii)at any time before the Closing, by Buyer on the one hand, or Seller on the other hand, in the event of material breach of this Agreement by the non-terminating party or if the satisfaction of any condition to such party’s obligations under this Agreement becomes impossible or impracticable with the use of commercially reasonable efforts and the failure of such condition to be satisfied is not caused by a breach by the terminating party;

(iv)by Buyer:

(A)if the Bankruptcy Court approves a Qualified Bid by a Qualified Bidder (including Buyer),

(B)if Seller elects to pursue a Stand-Alone Plan;

(C)if both the Sale Order and the Executory Contract Assumption and Assignment Agreement shall not have been entered by March 31, 2002 or if the auction contemplated in Section 5.15(c) does not occur by January 22, 2002 (but only if Buyer exercises such right to terminate within five (5) Business Days thereafter); or

(D)if, during the Initial Due Diligence Period, Buyer’s due diligence investigation of the Business and the Assets reveals any matter that, in Buyer’s reasonable judgment or discretion, would or could give rise to any Adverse Consequences (but only if Buyer exercises such right to terminate within five (5) Business Days after expiration of the Initial Due Diligence Period). In the event of a dispute between Buyer and Seller with respect to this Section 8.04(a)(iv)(D), such matter shall be submitted to the Bankruptcy Court.

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(b)If this Agreement is validly terminated pursuant to this Section 8.04, this Agreement will be null and void, and there will be no Liability on the part of any party (or any of their respective officers, directors, trustees, employees, agents, consultants or other representatives) except that Seller’s obligations under Sections 8.04(c), (d) and (e) and Buyer’s obligations under Sections 8.04(c) and (f), if any, shall survive any termination and shall apply thereafter to the extent applicable and as set forth herein.

(c)If, prior to the expiration of the Initial Due Diligence Period:

(i)Buyer terminates this Agreement pursuant to Section 8.04(a)(iii), Seller (and the Escrow Agent, to the extent it is holding funds of Seller pursuant to Section 2.05(c)) shall pay Buyer or Buyer’s designee, as the case may be, by wire transfer of immediately available funds to an account designated by Buyer or such designee, the Termination Fee and the Expense Reimbursement on the first Business Day following the date on which Buyer terminates the Agreement and the Escrow Agent shall return to Buyer the Deposit and any accrued interest thereon; provided, however, that if within twelve (12) months after the Agreement is terminated, Seller consummates a transaction with respect to a Competing Proposal, Seller shall pay Buyer an amount equal to the Break-Up Fee less the Termination Fee, payable from the proceeds at closing of the transaction, or the first of any series of transactions, contemplated by the Competing Proposal; or

(ii)Seller terminates this Agreement pursuant to Section 8.04(a)(iii), the Escrow Agent shall pay the Termination Fee to Seller or Seller’s designee, as the case may be, out of the Deposit by wire transfer of immediately available funds to an account designated by Seller or such designee. Such Termination Fee shall be paid on the first Business Day following the date on which Seller terminates the Agreement. The Escrow Agent shall return the remainder of the Deposit together with interest thereon to Buyer.

(d)If Buyer terminates the Agreement pursuant to Section 8.04(a)(iv)(D), Seller shall pay Buyer or Buyer’s designee, as the case may be, by wire transfer of immediately available funds to an account designated by Buyer or such designee, the Expense Reimbursement on the third Business Day following the date on which Buyer delivers to Seller documentation of such amount and the Escrow Agent shall immediately return to Buyer the Deposit and any accrued interest thereon.

(e)After the Initial Due Diligence Period has expired, provided that Buyer is not in default under this Agreement, Seller (and the Escrow Agent, to the extent it is holding funds of Seller pursuant to Section 2.05(c))shall pay Buyer or Buyer’s designee, as the case may be, the Break-Up Fee and the Expense Reimbursement by wire transfer of immediately available funds to an account designated by Buyer or such designee, in accordance with the following provisions:

(i)if Buyer elects to terminate this Agreement pursuant to Section 8.04(a)(iv)(A), an amount equal to the Termination Fee and Expense

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Reimbursement on the third Business Day after the Buyer delivers to Seller notice of such termination, and at the closing of a transaction involving a Qualified Bid by a Qualified Bidder other than Buyer that is approved by the Bankruptcy Court, the difference between the Break-Up Fee and the Termination Fee from the proceeds of the transaction; provided, however, that if Buyer is the Qualified Bidder with a Qualified Bid (other than this Agreement) approved by the Bankruptcy Court, then Buyer shall receive a credit at the closing of the transaction against the purchase price in and amount equal to the Break-Up Fee and Expense Reimbursement;

(ii)if Buyer elects to terminate this Agreement pursuant to Section 8.04(a), (iii), or (iv)(C), on the third Business Day after the Buyer delivers to Seller notice of such termination.

In the event of termination by Buyer, the Escrow Agent shall immediately return to Buyer the Deposit and any accrued interest thereon.

(f)If after entry of the Buyer Protection and Bidding Procedures Order, Buyer terminates the agreement pursuant to Section 8.04(a)(iv)(B), Seller shall pay Buyer or Buyer’s designee, as the case may be, by wire transfer of immediately available funds to an account designated by Buyer or such designee, the Break-Up Fee and Expense Reimbursement on the third Business Day following the date on which Buyer delivers to Seller notice of such termination and the Escrow Agent shall immediately return to Buyer the Deposit and any accrued interest thereon.

(g)If Seller terminates this Agreement pursuant to Sections 8.04(a)(iii) after the Initial Due Diligence Period has expired and Seller is not in default under this Agreement, the Escrow Agent shall pay the Break-Up Fee to Seller or Seller’s designee, as the case may be, out of the Deposit, by wire transfer of immediately available funds to an account designated by Seller or such designee. Such Break-Up Fee shall be paid on the first Business Day following the date on which Seller terminates the Agreement. The Escrow Agent shall return the remainder of the Deposit together with interest thereon to Buyer.

(h)Upon any termination of this Agreement, receipt of the fees set forth in this Section 8.04, if any, shall be the sole and exclusive remedy of the party receiving such fees for any termination hereof.

9. GENERAL

9.01 Schedules.

The Schedules and all Exhibits and documents referred to in or attached to this Agreement are integral parts of this Agreement as if fully set forth herein and all statements appearing therein shall be deemed to be representations. Nothing in the Schedules shall be deemed adequate to disclose an exception to a representation or warranty made herein unless the

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Schedule identifies the exception with reasonable particularity. Any statement, notation or other disclosure in any Schedule relates only to the particular section or subsection of the Agreement under which such statement, notation or disclosure is listed and does not apply to any other section or subsection of this Agreement.

9.02 Tax Effect.

None of the parties (nor such parties’ counsel or accountants) has made or is making in this Agreement any representation to any other party (or such party’s counsel or accountants) concerning any of the Tax effects or consequences on the other party of the transactions provided for in this Agreement. Each party represents that it has obtained, or may obtain, independent Tax advice with respect thereto and upon which it, if so obtained, has solely relied.

9.03 Reproduction of Documents.

This Agreement and all documents relating hereto, including consents, waivers and modifications that may hereafter be executed, the documents delivered at the Closing, and financial statements, certificates and other information previously or hereafter furnished to any party may be reproduced by any party by any photographic, photostatic, microfilm, micro-card, miniature photographic or other similar process and the parties may destroy any original documents so reproduced. The parties stipulate that any such reproduction shall be admissible in evidence as the original itself in any judicial, arbitral or administrative proceeding (whether or not the original is in existence and whether or not such reproduction was made in the ordinary course of business) and that any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence.

9.04 Time of Essence.

As to Sections 2.05, 5.01, 5.14, and 8.04 only, time is of the essence in the performance of this Agreement. This Section 9.04 may be waived only in a writing signed by both Parties and expressly referring hereto.

9.05 Consents, Approvals and Discretion.

Except as herein expressly provided to the contrary, whenever this Agreement requires any consent or approval to be given by either party that is not in such party’s sole discretion or either party must or may exercise discretion (other than its sole discretion), such consent or approval shall not be unreasonably withheld or delayed and such discretion shall be reasonably exercised.

9.06 Choice of Law; Submission to Jurisdiction.

This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard to such state’s conflicts of laws rules. Each of the Parties hereby submits to the exclusive jurisdiction of the Bankruptcy Court and irrevocably waives, to the fullest extent permitted by law, any objection to the laying of venue of any such proceeding

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brought in such Bankruptcy Court and any claim that such Bankruptcy Court is an inconvenient forum; provided, however, that if the Bankruptcy does not accept jurisdiction of any proceeding, then the parties submit to the jurisdiction of the state and/or federal courts of Delaware.

9.07 Benefit; Assignment.

This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective legal representatives, successors and assigns. No party may assign this Agreement without the prior written consent of the other party; provided, however, that Buyer may assign this Agreement, in whole or in part, to any Affiliate of Buyer. In the event Buyer elects to assign this Agreement in whole or in part to any Affiliate of Buyer, Buyer shall guaranty the performance of any and all obligations of such Affiliate hereunder.

9.08 No Third Party Beneficiary.

The terms and provisions of this Agreement (including provisions regarding employee and employee benefit matters) are intended solely for the benefit of the parties, and their respective successors and permitted assigns, and are not intended to confer third-party beneficiary rights upon any other Person. Any reference in this Agreement to one or more Employee Benefit Plans of Buyer or Seller includes provisions, if any, in such plans permitting their termination or amendment and any covenant in this Agreement to provide benefits under any Employee Benefit Plan shall not be deemed or construed to limit Buyer’s right to terminate or amend such plan of Buyer in accordance with its terms.

9.09 Waiver of Breach, Right or Remedy.

The waiver by any party of any breach or violation by another party of any provision of this Agreement or of any right or remedy of the waiving party in this Agreement (a) shall not waive or be construed to waive any subsequent breach or violation of the same provision, (b) shall not waive or be construed to waive a breach or violation of any other provision, and (c) shall be in writing and may not be presumed or inferred from any party’s conduct. Except as expressly provided otherwise in this Agreement no remedy conferred by this Agreement is intended to be exclusive of any other remedy, and each and every remedy shall be in addition to every other remedy granted in this Agreement or now or hereafter existing at law or in equity, by statute or otherwise. The election of one or more remedies by a party shall not constitute a waiver of the right of such waiving party to pursue other available remedies. In addition to any other rights and remedies any party may have at law or in equity for breach of this Agreement, each party shall be entitled to seek an injunction to enforce the provisions of this Agreement.

9.10 Notices.

Any notice, demand or communication required, permitted or desired to be given hereunder shall be deemed effectively given if given in writing (a) on the date tendered by personal delivery, (b) on the date received by facsimile or other electronic means, (c) one day after the date tendered for delivery by nationally recognized overnight courier, or (d) three days after the date tendered for delivery by United States mail with postage prepaid thereon, certified

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or registered mail, return receipt requested, in any event addressed as follows:

If to Buyer:	Nucor Steel Alabama, LLC
	2100 Rexford Road
	Charlotte, North Carolina 28211
	Attn: Joseph A. Rutkowski
	Telephone: (704) 367-8677
	Facsimile: (704) 367-8696

with a copy (that shall not
constitute notice) to:	Moore & Van Allen PLLC
	Suite 4700
	100 North Tryon Street
	Charlotte, North Carolina 28202-4003
	Attn: Ernest S. DeLaney III
	Telephone: (704) 331-3519
	Facsimile: (704) 339-5819

If to Seller:	Trico Steel Company, L.L.C.
	P.O. Box 2243
	Decatur, Alabama 35609-2243
	Attn: Richard A. Veitch, President
	Telephone: (256) 580-9530
	Facsimile: (256) 301-0808

with a copy (that shall not constitute notice) to:	Young Conaway Stargatt & Taylor, LLP
	The Brandywine Building
	1000 West Street, 17th Floor
	P.O. Box 391
	Wilmington, Delaware 19899-0391
	Attn: Craig D. Grear, Esquire
	Telephone: (302) 571-6612
	Facsimile: (302) 571-0453

or to such other address or number, and to the attention of such other Person, as any party may designate at any time in writing in conformity with this Section 9.10.

9.11 Misdirected Payments; Offset Rights.

Seller shall remit to Buyer with reasonable promptness any monies received by Seller constituting or in respect of the Assets, Assumed Contracts and Assumed Liabilities. Buyer shall remit to Seller with reasonable promptness any monies received by Buyer constituting or in respect of the Excluded Assets, Rejected Contracts, Completed Contracts and Excluded Liabilities. If any Person determines that funds previously paid or credited to Seller or the Business in respect of services rendered prior to the Closing Date have resulted in an

46

overpayment or must be repaid, Seller shall be responsible for the repayment of said monies (and the defense of such actions), except to the extent that the repayment obligation was an Assumed Liability. If Buyer suffers any deduction to or offset against amounts due Buyer of funds previously paid or credited to Seller or the Business in respect of services rendered prior to the Closing Date, Seller shall immediately pay to Buyer the amounts so billed or offset upon demand, except to the extent that such amounts represent billings in excess of cost and revenues recognized under the Assumed Contracts. Any amounts due Buyer by Seller, or due Seller by Buyer, may be offset against monies or other funds held by the party entitled to payment of such amounts.

9.12 Severability.

If any provision of this Agreement is held or determined to be illegal, invalid or unenforceable under any present or future law by a court of competent jurisdiction: (a) such provision will be fully severable; (b) this Agreement will be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof; (c) the remaining provisions of this Agreement will remain in full force and effect and will not be affected by the illegal, invalid or unenforceable provision or by its severance herefrom; and (d) in lieu of such illegal, invalid or unenforceable provision, Seller and Buyer agree to negotiate in good faith a legal, valid and enforceable provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible.

9.13 Entire Agreement; Counterparts; Amendment.

This Agreement supersedes all prior or contemporaneous contracts, agreements and understandings and constitutes the entire agreement of whatsoever kind or nature existing between or among the parties representing the subject matter of this Agreement and no party shall be entitled to benefits other than those specified herein. As between or among the parties, any oral or written representation, agreement or statement not expressly incorporated herein, whether given prior to or on the Effective Date, shall be of no force and effect unless and until made in writing and signed by the parties on or after the Effective Date. Each representation, warranty and covenant contained in this Agreement has independent significance and if any party has breached any representation, warranty or covenant contained herein in any respect, the fact that there exists another representation, warranty or covenant relating to the same subject matter (regardless of the relative level of specificity) that such party has not breached shall not detract from or mitigate the fact that the party is in breach of the first representation, warranty or covenant. This Agreement may be executed in two (2) or more counterparts, each and all of which shall be deemed an original and all of which together shall constitute but one and the same instrument. This Agreement may not be amended except in a written instrument executed by the parties.

9.14 Survival.

The representations and warranties contained in this Agreement and in any Schedule or certificate delivered pursuant to this Agreement shall not survive consummation of the transactions contemplated by this Agreement and shall expire immediately after the Closing.

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9.15 Drafting.

No provision of this Agreement shall be interpreted for or against any Person on the basis that such Person was the draftsman of such provision, and no presumption or burden of proof shall arise favoring or disfavoring any Person by virtue of the authorship of any provision of this Agreement.

9.16 Confidentiality.

The provisions of the confidentiality agreement between Buyer and Seller dated June 13, 2001 are hereby incorporated by this reference as if fully set forth herein and shall apply and remain in full force and effect through the Closing Date.

9.17 Publicity.

No party to this Agreement shall prior to the Closing, without prior consultation with the other parties to the extent practicable under the circumstances taking into account applicable laws and stock exchange requirements, make any public disclosure with respect to the Transaction, any negotiations or discussions concerning the Transaction or the existence of this Agreement.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed in multiple originals by their duly authorized officers as of the Effective Date.

SELLER: TRICO STEEL COMPANY, L.L.C.
By:	/s/ RICHARD A.VEITCH
Name:	Richard A. Veitch
Title:	President & CEO

BUYER: NUCOR STEEL ALABAMA, LLC
By:	/s/ DANIEL R. DIMICCO
Name:	Daniel R. DiMicco
Title:	President

GUARANTOR NUCOR CORPORATION
By:	/s/ DANIEL R. DIMICCO
Name:	Daniel R. DiMicco
Title:	President & Chief Executive Officer

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[Letterhead of Nucor Corporation]

January 18, 2002

Trico Steel Company, LLC
Post Office Box 2243
Decatur, AL 35609-2243
Attention: Mr. Richard A. Veitch, President

Re:Trico/Nucor Asset Purchase Agreement

Gentlemen:

Reference is made to that certain Asset Purchase Agreement (the “Agreement”) by and among Trico Steel Company, LLC (“Trico”), Nucor Steel-Alabama, LLC (“NSA”) and Nucor Corporation (“Nucor”) (collectively, the “Parties”) dated as of November 9, 2001. Capitalized terms in this letter shall have the meaning ascribed to them in the Agreement. With respect to the Agreement, the Parties agree to the following factual and legal matters:

A.The due diligence investigation conducted by NSA revealed Adverse Consequences, which entitle NSA pursuant to Sections 8.04(a)(iv)(D) and 8.04(d) of the Agreement to terminate the Agreement, to receive the Expense Reimbursement and to receive the return of its Deposit and any accrued interest thereon.

B. Trico has materially breached its representations and warranties set forth in Section 3.08 of the Agreement with respect to the condition of all equipment included within the Assets, and the amount reasonably necessary to cure such breach is $3,300,000.

C.The Alabama Department of Environmental Management (“ADEM”) has orally informed Trico that Trico is in violation of the NOx limitation of its PSD permit. ADEM has recently taken action decreasing the discharge limitation for oil and grease and total suspended solids in Trico’s NPDES permit. These actions of ADEM constitute actions made by a Governmental Authority as a result of which NSA reasonably and in good faith deems it inadvisable to proceed with the Transaction and are conditions precedent to the obligations of NSA in the Agreement as set forthh in Section 7.03 of the Agreement.

D.The SO2 limitations of Trico’s PSD permit are too stringent to allow for reasonable commercial operation of the Business, and the proposed amendment to such permit prepared by Trico has not been submitted to or approved by ADEM. Accordingly, NSA has not received a permit from a Governmental Authority required to consummate the transactions contemplated under the Agreement, which is a condition precedent to the obligations of NSA in the Agreement as set forth in Section 7.02(a) of the Agreement.

Trico Steel Company LLC
January 18, 2002
Page 2

Based upon the foregoing, the Parties further agree as follows:

1. The Parties agree to a cure amount of $3,300,000 for the breach by Trico of its representations and warranties set forth in Section 3.08 of the Agreement. Such amount will be deducted by NSA from the Purchase Price. NSA agrees to waive any further remedies with respect to such breach.

2.The Parties agree that the current status of the PSD and NPDES permits constitute a failure to satisfy the conditions precedent set forth in Section 7.02(a) and Section 7.03 of the Agreement. NSA and Trico agree to cooperate in good faith to obtain amendments to these permits in accordance with the emissions limitations that will be set forth in the permit amendment applications. NSA will take the lead in such effort and will pay all of its out-of-pocket expenses associated therewith.

3.As set forth in Section 8.01 of the Agreement, the Closing will take place on the second Business Day following satisfaction or waiver of the foregoing conditions precedent, which the Parties believe will occur by August 30, 2002.

4.NSA waives its right to terminate the Agreement due to Adverse Consequences as set forth in Section 8.04(a)(iv)(D) of the Agreement. NSA also waives its right to terminate the Agreement pursuant to Section 8.04(a)(iii) with respect to a material breach of Section 3.08 or Section 3.11(a) of the Agreement.

5.If the amendments to the pennits contemplated in paragraph 2 above cannot or will not be obtained prior to August 30, 2002, NSA may terminate the Agreement upon notice to Trico and in such event Trico shall pay the Expense Reimbursement to NSA; however, in such event NSA waives its right to receive the Breakup Fee.

6.If there is any inconsistency between this letter and any provision of the Agreement, the provisions of this letter shall be controlling and the Agreement shall be deemed to be amended accordingly.

By signing this letter, Nucor, on behalf of itself and its wholly owned med subsidiary, NSA, agrees to all of the matters and things set forth in this letter. The agreement of Trico to the same is acknowledged by the signature of its appropriate officer set forth below.

Sincerely,

Nucor Corporation

/s/ JOSEPH A. RUTKOWSKI

Joseph A. Rutkowski
Executive Vice President-Nucor
Vice President-Nucor Steel Alabama, LLC

Agreed to and Accepted by:
Trico Steel Company, LLC

/s/ RICHARD A.VEITCH

By: RICHARD A. VEITCH , President

EX-10.X

Exhibit 10(x)
Nucor Corporation
2002 Form 10-K

NUCOR CORPORATION
SENIOR OFFICERS SEVERANCE POLICY

Effective April 1, 2002, upon retirement, termination or resignation, Senior Officers of Nucor Corporation under the age of 55 will receive severance equal to the greater of (1) one month of base salary per year of service, with a minimum payment of six months or (2) the value of their forfeitable stock at the date of termination or retirement. Senior officers 55 or older are fully vested in forfeitable stock. Accordingly, upon retirement, termination or resignation, Senior Officers 55 or older will receive one month of base salary per year of service, with a minimum payment of six months. In all cases, payment is contingent upon execution of a 24-month non-compete agreement for those Senior Officers who do not have an existing non-compete agreement. This severance payment is payable to the Senior Officer’s spouse or estate in the event of the Senior Officer’s death.

EX-13

Exhibit 13

FINANCIAL HIGHLIGHTS

	2002			2001			% CHANGE
FOR THE YEAR
Net sales	$	4,801,776,537		$	4,333,706,754			+11	%
Earnings:
Earnings before income taxes		230,053,015			179,369,007			+28	%
Provision for income taxes		67,973,000			66,408,000			+2	%
Net earnings		162,080,015			112,961,007			+43	%
Per share:
Basic		2.08			1.45			+43	%
Diluted		2.07			1.45			+43	%
Dividends per share		.76			.68			+12	%
Percentage of earnings to sales		3.4	%		2.6	%		+31	%
Percentage of earnings to average equity		7.2	%		5.2	%		+38	%
Capital expenditures		243,598,096			261,145,658			-7	%
Depreciation		307,101,032			289,063,213			+6	%
Sales per employee		527,581			530,961			-1	%
AT YEAR END
Working capital	$	832,602,872		$	889,507,190			-6	%
Property, plant and equipment		2,932,058,102			2,365,655,061			+24	%
Long-term debt		878,550,000			460,450,000			+91	%
Stockholders’ equity		2,322,989,489			2,201,460,329			+6	%
Per share		29.71			28.29			+5	%
Shares outstanding		78,180,108			77,814,511			—
Employees		9,800			8,400			+17	%

Certain amounts for the prior year have been reclassified to conform to the 2002 presentation.

FORWARD-LOOKING STATEMENTS Certain statements made in this annual report are forward-looking statements that involve risks and uncertainties. These forward-looking statements reflect the Company’s best judgment based on current information, and although we base these statements on circumstances that we believe to be reasonable when made, there can be no assurance that other factors will not affect the accuracy of such forward-looking information. As such, the forward-looking statements are not guarantees of future performance, and actual results may vary materially from the results and expectations discussed herein. Factors that might cause the Company’s actual results to differ materially from those anticipated in forward-looking statements include, but are not limited to: (1) the sensitivity of the results of our operations to prevailing steel prices and the changes in the supply and cost of raw materials, including steel scrap; (2) availability and cost of electricity and natural gas; (3) competitive pressure on sales and pricing, including pressure from imports and substitute materials; (4) uncertainties surrounding the global economy including excess world capacity for steel production; (5) U.S. and foreign trade policy affecting steel imports or exports including adjustments, repeals or lapses of existing U.S. tariffs on imported steel and adverse outcomes of pending and future trade cases alleging unlawful practices in connection with the importing of steel into the U.S.; (6) changes in significant government regulations affecting environmental compliance; (7) the cyclical nature of the domestic steel industry; (8) capital investments and their impact on the Company’s performance; (9) our safety performance; and (10) other factors described in the Company’s filings with the Securities and Exchange Commission.

AT A GLANCE

STEEL MILLS

BAR MILLS

Products: Steel bars, angles and other products for automotive, construction, farm machinery, metal buildings, furniture and recreational equipment.

Darlington, South Carolina
Norfolk, Nebraska
Jewett, Texas
Plymouth, Utah
Auburn, New York
   (Nucor Steel Auburn, Inc.)
Birmingham, Alabama
   (Nucor Steel Birmingham, Inc.)
Kankakee, Illinois
   (Nucor Steel Kankakee, Inc.)
Jackson, Mississippi
   (Nucor Steel Jackson, Inc.)
Seattle, Washington
   (Nucor Steel Seattle, Inc.)
Pompano Beach, Florida
   (Nucor Steel Services of Florida, Inc.)


SHEET MILLS

Products: Flat-rolled steel for automotive, appliances, pipes and tubes, construction and other industries.

Crawfordsville, Indiana
Hickman, Arkansas
Berkeley County, South Carolina
Decatur, Alabama
   (Nucor Steel Decatur, LLC) NUCOR-YAMATO STEEL COMPANY

Products: Super-wide flange steel beams, pilings, heavy structural steel products for fabricators, construction companies, manufacturers and steel service centers.

Blytheville, Arkansas


BEAM MILL

Products: Wide flange steel beams, pilings, heavy structural steel products for fabricators, construction companies, manufacturers and steel service centers.

Berkeley County, South Carolina


PLATE MILL

Products: Steel plate for manufacturers of heavy equipment, rail cars, ships and barges, refinery tanks and others.

Hertford County, North Carolina

STEEL PRODUCTS

VULCRAFT

Products: Steel joists, joist girders and steel deck for buildings.

Florence, South Carolina
Norfolk, Nebraska
Fort Payne, Alabama
Grapeland, Texas
St. Joe, Indiana
Brigham City, Utah
Chemung, New York
   (Vulcraft of New York, Inc.) COLD FINISH

Products: Cold finished steel bars for shafting and precision machined parts.

Norfolk, Nebraska
Darlington, South Carolina
Brigham City, Utah


BUILDING SYSTEMS

Products: Metal buildings and metal building components for commercial, industrial and institutional building markets.

Waterloo, Indiana
Swansea, South Carolina
Terrell, Texas


FASTENER

Products: Steel hexhead cap screws, structural bolts and hex bolts for automotive, machine tools, farm implements, construction and military applications.

St. Joe, Indiana


NUCON STEEL COMMERCIAL CORPORATION

Products: Load bearing light gauge steel framing systems for the commercial and residential construction markets.

Denton, Texas (headquarters)
Dallas, Georgia


CORPORATE OFFICE

Charlotte, North Carolina

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OPERATIONS REVIEW

STEEL MILLS

BAR MILLS, SHEET MILLS, STRUCTURAL MILLS AND PLATE MILL Nucor operates scrap-based steel mills in sixteen facilities. These mills utilize modern steelmaking techniques and produce steel at a cost competitive with steel manufactured anywhere in the world.

BAR MILLS

Nucor has nine bar mills located in South Carolina, Nebraska, Texas, Utah, New York, Alabama, Illinois, Mississippi and Washington that produce bars, angles and light structural shapes in carbon and alloy steels. These products have wide usage including automotive, construction, farm equipment, metal buildings, furniture and recreational equipment. In constructing Nucor steel mills, capital cost per ton of capacity has been lower than the capital cost generally required for other steel mills. Four of the bar mills were constructed by Nucor between 1969 and 1981. Over the years, Nucor has completed extensive capital projects to keep these facilities modernized, including a modernization of the rolling mill at the Nebraska facility, a new melt shop at the Texas facility, and a new finishing end at the South Carolina facility that are currently underway. In 2001, Nucor purchased substantially all of the assets of Auburn Steel Company, Inc.’s steel bar facility in Auburn, New York for approximately $115,000,000. This facility has the capacity to produce up to 450,000 tons of merchant and special bar quality (SBQ) steel shapes and rebar. On December 9, 2002, Nucor completed the acquisition of substantially all the assets of Birmingham Steel Corporation for a cash purchase price of approximately $615,000,000. The four bar mills acquired from Birmingham can produce up to 2,000,000 tons annually. The total capacity of our nine bar mills is approximately 5,800,000 tons per year.

SHEET MILLS

The sheet mills produce flat-rolled steel for automotive, appliances, pipes and tubes, construction and other industries. The four sheet mills are located in Indiana, Arkansas, South Carolina and Alabama. Nucor constructed three of the sheet mills between 1989 and 1996. The constructed sheet mills utilize thin slab casters to produce hot rolled sheet, which can be further processed through cold rolling and galvanizing. In July 2002, Nucor completed the purchase of substantially all the assets of Trico Steel Company, LLC, for a cash purchase price of $117,700,000. This sheet mill is located in Decatur, Alabama, and has an annual capacity of approximately 1,900,000 tons. The Decatur mill utilizes a medium slab caster, but is still very similar to our sheet mills equipped with thin slab casters. The restart of this acquired mill has progressed quickly, and we expect it to operate at the rated capacity by the fourth quarter of 2003. Total capacity of the four sheet mills is about 8,400,000 tons per year.

STRUCTURAL MILLS

The structural mills produce wide flange steel beams, pilings and heavy structural steel products for fabricators, construction companies, manfacturers and steel service centers. In 1988, Nucor and Yamato Kogyo, one of Japan’s major producers of wide-flange beams, completed construction of a beam mill located near Blytheville, Arkansas. Nucor owns a 51% interest in Nucor-Yamato Steel Company. During 1999, Nucor started operations at its 700,000 tons-per-year steel beam mill in South Carolina. Both mills use a special continuous casting method that produces a beam blank closer in shape to that of the finished beam than traditional methods. Current annual production capacity of our two structural mills is approximately 3,200,000 tons.

PLATE MILL

Nucor’s plate mill is located in North Carolina and produces steel plate for manufacturers of heavy equipment, rail cars, ships, barges, refinery tanks and others. During 2000, Nucor substantially completed construction and began operating the 1,200,000 tons-per-year steel plate mill. The start-up has been successful and the mill is producing high quality plate. With the competitive advantages of new, more efficient production technology and Nucor’s strong customer service orientation, we expect to build a profitable market share position in the plate market.

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OPERATIONS REVIEW

OPERATIONS Nucor’s steel mills are among the most modern and efficient mills in the United States. Steel scrap is melted in electric arc furnaces and poured into continuous casting systems. Highly sophisticated rolling mills convert the billets and slabs into rebar, angles, rounds, channels, flats, sheet, beams, plate and other products.

Production in 2002 was a record 13,622,000 tons, an 11% increase from 12,316,000 tons in 2001. Annual production capacity has grown from 120,000 tons in 1970 to a present total of about 18,600,000 tons.

The operations in the rolling mills are highly automated and require fewer operating employees than older mills. All Nucor steel mills have high productivity, which results in employment costs of approximately 11% of the sales dollar. This is lower than the employment costs of integrated steel companies producing comparable products. Employee turnover in our mills is extremely low. All employees have a significant part of their compensation based on their productivity. Production employees work under group incentives that provide increased earnings for increased production. This additional compensation is paid weekly.

Steel mills are large consumers of electricity and gas. However, because of the high efficiency of Nucor steel mills, these energy costs were less than 10% of the sales dollar in 2002.

Scrap and scrap substitutes are the most significant element in the total cost of steel. Their average cost increased to $110 per ton in 2002 from $101 per ton in 2001.

MARKETS AND MARKETING Approximately 90% of the sixteen steel mills’ production in 2002 was sold to outside customers and the balance was used internally by Vulcraft, Cold Finish, Building Systems and Fastener divisions. Steel sales to outside customers in 2002 were a record 12,314,000 tons, 12% higher than the 11,032,000 tons in 2001.

Our steel mill customers are primarily manufacturers, steel service centers and fabricators. An increased focus in our marketing effort is to build long-term relationships with contract customers who purchase more value added products. The basis for these relationships is outstanding quality and service, competitive pricing and the ability to meet our commitments.

TRADE ISSUES Nucor’s continued involvement in trade issues is a critical part of our efforts to support the long-term success of our steel-making operations. Unfairly traded, illegally dumped steel imports have devastated the U.S. steel industry and its workers. As the largest and most open steel market in the world, the U.S. has become the dumping ground for excess steel production. The root causes of the import surges experienced in recent years are foreign overcapacity, foreign government subsidies and foreign anti-competitive practices.

Nucor devoted significant resources to this issue in 2002 in an effort to help the Administration and Congress craft a sensible long-term solution to these critical issues, and will continue our involvement going forward in 2003.

NEWER FACILITIES AND EXPANSIONS During 2000, Nucor started operations of the second caster addition at the steel sheet mill in Berkeley County, South Carolina. This addition cost more than $40,000,000 and increased this mill’s hot-band capacity from 1,500,000 tons to 2,400,000 tons per year. During 2001, Nucor started operations of the second cold rolling facility at the South Carolina sheet mill, increasing this mill’s cold rolled steel capacity from 750,000 tons to 1,500,000 tons per year, at a cost of more than $40,000,000.

The steel plate mill in North Carolina started casting and rolling in October 2000. This facility, which has an annual capacity of 1,200,000 tons, cost about $480,000,000.

At the end of the first quarter of 2001, Nucor completed the acquisition of the assets of Auburn Steel’s merchant bar, rebar, and SBQ steel mill. Nucor Steel Auburn, Inc. is an important addition to our bar mills, as it gives Nucor a merchant bar presence in the Northeast and is also an excellent strategic fit with our new Vulcraft facility in New York. The transition and integration of this business has been extremely successful and has helped us develop our planning for more recent acquisitions.

In February 2002, Nucor announced that over $200,000,000 would be spent on bar mill capital projects over the next three years. The projects include a modernization of the rolling mill at the Nebraska facility, a new melt shop at the Texas mill, and a new finishing end at the South Carolina facility. We expect that these investments will improve efficiencies, lower costs and improve the product quality for the related bar mills.

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OPERATIONS REVIEW

On July 22, 2002 Nucor’s wholly owned subsidiary, Nucor Steel Decatur, LLC, purchased substantially all the assets of Trico Steel Company, LLC for a purchase price of $117,700,000 million. This 1,900,000-ton sheet mill, located in Decatur, Alabama, began operations in 1997 but had been shut down as the result of bankruptcy. The purchase strategy called for a major renovation of the facility including: the scrap handling system, both electric arc furnaces, the alloy system, the water systems, the tunnel furnace, rolling mill gearing and the finished coil handling equipment. The related capital investment was over $68,000,000 in 2002. Within 60 days of acquisition, our team at Decatur successfully produced its first heat and cast its first slabs. The restart of this mill has continued at a very fast pace, and we expect to produce approximately 1,500,000 tons at Decatur in 2003.

On December 9, 2002, we completed the acquisition of substantially all the assets of Birmingham Steel Corporation for a cash purchase price of approximately $615,000,000, including $116,900,000 in inventory and receivables. Primary assets purchased were four operating steel mills that produce rebar and other bar products and have combined annual capacity of about 2,000,000 tons. These plants are very similar to the ones we have operated, and the employees are not represented by unions. The compatibility of the four purchased bar mills has helped to facilitate what has been a very smooth transition and integration process.

COMMERCIALIZATION OF NEW TECHNOLOGIES Nucor began operations of its 100% owned Castrip facility in Crawfordsville, Indiana in May 2002. This facility uses the breakthrough technology of strip casting, to which Nucor holds exclusive rights in the United States and Brazil. Strip casting involves the direct casting of molten steel into final shape and thickness without further hot or cold rolling. This process allows lower investment and operating costs, reduced energy consumption and smaller scale plants than can be economically built with current technology. This process also reduces the overall environmental impact of producing steel by generating significantly lower emissions, particularly NOx. Our team at Crawfordsville has succeeded in producing prime, saleable coils, and the plant is now staffed to operate 24 hours a day, seven days a week.

In April 2002, Nucor entered a joint venture with The Rio Tinto Group, Mitsubishi Corporation and Chinese steel maker Shougang Corporation, to construct a commercial HIsmelt plant in Kwinana, Western Australia. Demolition of the pilot plant is completed and construction of the commercial facility has begun. The HIsmelt process converts iron ore fines and coal fines to liquid metal, eliminating the need for a blast furnace, sinter/pellet plants and coke ovens. Nucor has a 25% interest in the joint venture that owns the HIsmelt commercial plant.

OUTLOOK FOR THE FUTURE The manufacture of steel will continue to be a key factor in Nucor’s future performance. Total steel production is anticipated to increase significantly over the next several years from the 13,622,000 tons produced in 2002. Nucor expects to obtain additional capacity through expansions at our existing steel mills, greenfield construction or acquisitions. We expect to generate above-average earnings from our steelmaking operations in the future, but recognize that uncertainty in external factors such as the economy and the level of imports will have a significant impact on our results. While we cannot control these outside forces, Nucor has a long-standing tradition of emerging from cyclical downturns stronger than before entering them. We will take advantage of the economic downturn to gain market share, penetrate new markets and emphasize cost reduction and quality improvement initiatives.

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OPERATIONS REVIEW

 

 

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OPERATIONS REVIEW

STEEL PRODUCTS

VULCRAFT is the nation’s largest producer of open-web steel joists, joist girders and steel deck, which are used for building construction.

OPERATIONS Steel joists and joist girders are produced and marketed nationally through seven Vulcraft facilities located in South Carolina, Nebraska, Alabama, Texas, Indiana, Utah and New York. Current annual production capacity is more than 685,000 tons. In 2002,Vulcraft produced 462,000 tons of steel joists and joist girders, a decrease of 13% from the 532,000 tons produced in 2001.

Materials, primarily steel, were 51% of the joist sales dollar in 2002. Vulcraft obtained 97% of its steel requirements for joists and joist girders from the Nucor bar mills. For 2002, freight costs for joists and joist girders were less than 10% of the sales dollar. Vulcraft maintains an extensive fleet of trucks to ensure and control on-time delivery.

The Vulcraft facilities in South Carolina, Nebraska, Alabama, Texas, Indiana and New York produce steel deck. Current deck annual production capacity is in excess of 400,000 tons. Vulcraft steel deck sales decreased 4% from 344,000 tons in 2001 to 330,000 tons in 2002. Coiled sheet steel was about 69% of the steel deck sales dollar in 2002. Vulcraft obtained 96% of its steel requirements for steel deck production from the Nucor sheet mills. For 2002, freight costs for deck were less than 10% of the sales dollar.

Almost all of the production employees of Vulcraft work with a group incentive system, which provides increased compensation each week for increased performance.

MARKETS AND MARKETING Steel joists, joist girders and steel decking are used extensively as part of the roof and floor support systems in manufacturing buildings, retail stores, shopping centers, warehouses, schools, churches, hospitals and, to a lesser extent, in multi-story buildings and apartments. Building support systems using joists, joist girders and steel deck are frequently more economical than other systems.

Steel joists and joist girder sales are obtained by competitive bidding. Vulcraft quotes on a significant percentage of the domestic buildings using steel joists and joist girders as part of the support systems. In 2002, Vulcraft supplied more than 40% of total domestic sales of steel joists. Steel deck is specified in the majority of buildings using steel joists and joist girders. In 2002, Vulcraft supplied more than 30% of total domestic sales of steel deck.

Sales of steel joists, joist girders and steel deck are dependent on the non-residential building construction market.

NEWER FACILITIES Nucor began construction on a Vulcraft facility in Chemung, New York (Vulcraft of New York, Inc.) in 2000. Start-up of the facility began in the second half of 2001. This facility produces steel joists, joist girders and steel deck and cost about $50,000,000. The majority of the raw materials for this facility are supplied by Nucor’s steel mills in Auburn, New York and Crawfordsville, Indiana. The Chemung Vulcraft facility represents a continuation of our successful value-added strategy, as well as expansion into a new geographic market for Vulcraft.

OUTLOOK FOR THE FUTURE The depressed level of construction over the past two years has unfavorably impacted the volume of non-residential buildings supplied by Vulcraft. Prevailing economic projections call for continued slow-down of building construction in 2003, which will affect the sales of steel joists, joist girders and steel deck and the earnings of Vulcraft.

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OPERATIONS REVIEW

 

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OPERATIONS REVIEW

COLD FINISH AND FASTENER Nucor manufactures a variety of products using steel from Nucor mills.

COLD FINISH

Nucor Cold Finish has facilities in Nebraska, South Carolina and Utah. These facilities produce cold drawn and turned, ground and polished steel bars that are used extensively for shafting and precision machined parts. Nucor Cold Finish produces rounds, hexagons, flats and squares in carbon and alloy steels. These bars, in turn, are purchased by the automotive, farm machinery, hydraulic, appliance and electric motor industries, as well as by service centers. Nucor Cold Finish bars are used in tens of thousands of products. A few examples include anchor bolts, farm machinery, hydraulic cylinders, and shafting for air conditioner compressors, ceiling fan motors, garage door openers, electric motors and lawn mowers.

The total capacity of the three facilities is about 350,000 tons per year. All three facilities are among the most modern in the world and use in-line electronic testing to ensure outstanding quality. Nucor Cold Finish obtains most of its steel from the Nucor bar mills. This factor, along with the efficient facilities using the latest technology, results in highly competitive pricing.

In 2002, sales of cold finished steel products were 226,000 tons, an increase of 11% from 2001’s 203,000 tons. The total cold finish market is estimated to be more than 1,800,000 tons. Nucor Cold Finish anticipates opportunities for significant increases in sales and earnings during the next several years.

FASTENER

Nucor Fastener’s state-of-the-art steel bolt-making facility in Indiana produces standard steel hexhead cap screws, hex bolts, structural bolts and custom engineered fasteners. Fasteners are used in a broad range of markets, including automotive, machine tools, farm implements, construction and military applications.

Annual capacity is more than 75,000 tons, which is less than an estimated 20% of the total market for these products. The modern facility allows Nucor Fastener to maintain highly competitive pricing in a market currently dominated by foreign suppliers. This operation is highly automated and has fewer employees than comparable facilities. The Fastener division obtains much of its steel from the Nucor bar mills.

 

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OPERATIONS REVIEW

BUILDING SYSTEMS AND LIGHT GAUGE STEEL FRAMING Nucor manufactures metal buildings and steel framing systems for commercial, industrial and residential construction markets.

BUILDING SYSTEMS

Nucor Building Systems produces pre-engineered metal building systems and components in Indiana, South Carolina and Texas. With the start-up of the building systems facility in Terrell, Texas during 2000, the annual capacity is now more than 145,000 tons. The size of the buildings that can be produced ranges from less than 500 square feet to more than 1,000,000 square feet.

Complete metal building packages can be customized and combined with other materials such as glass, wood and masonry to produce a cost effective, aesthetically pleasing building designed for customers’ special requirements. The buildings are sold through a builder distribution network in order to provide fast-track, customized solutions for building owners.

Building systems sales in 2002 were approximately 68,000 tons, an increase of 5% from the 65,000 tons sold in 2001. The primary markets are commercial, industrial and institutional buildings, including distribution centers, automobile dealerships, retail centers, schools, warehouses and manufacturing facilities. Nucor Building Systems obtains a significant portion of its steel requirements from the Nucor bar and sheet mills.

LIGHT GAUGE STEEL FRAMING

In November 2001, Nucor acquired ITEC Steel, Inc. (now called NUCON STEEL Commercial Corporation). NUCON STEEL specializes in light gauge steel framing systems for the commercial and residential construction markets with facilities in Texas and Georgia. As a leader in the emerging load bearing light gauge steel framing industry, NUCON STEEL will provide Nucor with a platform to enter this rapidly expanding new market. Nucor plans to aggressively broaden NUCON STEEL’s opportunities through geographic expansion and the introduction of new products.

In January 2002, Nucor announced that the company had entered into a strategic alliance with Truswal Systems Corporation. The alliance includes a software development and license agreement for proprietary design, engineering and layout software. NUCON STEEL will use Truswal’s software in its operations and Truswal will market NUCON STEEL’s light gauge steel framing products through its fabricator network.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OPERATIONS

Nucor’s business is the manufacture and sale of steel and steel products. During the last five years, the sales of Nucor have increased 11% from $4,340,000,000 in 1997 to $4,802,000,000 in 2002. Total tons sold by Nucor have increased 37% from 9,786,000 tons in 1997 to 13,442,000 tons in 2002. This growth has been generated through acquisitions, continual improvement of existing operations, and greenfield projects using new technologies.

While Nucor has historically grown through greenfield projects and the continual improvement of existing operations, 2002 was noteworthy for two critical acquisitions: the assets of Trico Steel Company, LLC in Decatur, Alabama purchased in July 2002 and the assets of Birmingham Steel Corporation purchased in December 2002. Both of these acquisitions are in the early stages of operating as part of Nucor; however, we are very pleased by the transition progress at these facilities. Since these acquisitions occurred in the latter part of the year, the impact on sales in 2002 was minimal.

Nucor reports its results in two segments, steel mills and steel products. The steel mills segment includes carbon and alloy steel in sheet, bars, structural and plate. The steel products segment includes steel joists and joist girders, steel deck, cold finished steel, steel fasteners, metal building systems and light gauge steel framing.

NET SALES Net sales for 2002 increased 11% to $4,802,000,000, compared with $4,334,000,000 in 2001. The average sales price per ton increased less than 1% from $354 in 2001 to $357 in 2002, while total shipments to outside customers increased 10%. The increase in steel shipments to outside customers occurred in the steel mills segment as imports subsided after March 5, 2002, when President Bush imposed a series of tariffs relating to dumped imported steel. Our steel products segment weakened further in 2002 with lower selling prices and volumes reflecting a depressed non-residential construction market.

Net sales for 2001 decreased 9% to $4,334,000,000, compared with $4,757,000,000 in 2000. The decrease was primarily due to a 17% decrease in average sales price per ton from $425 in 2000 to $354 in 2001. Sales prices were unfavorably impacted at our steel mills segment by increased imports, while the downturn in the economy impacted our steel products segment. The strong sales experienced in 2000 were primarily due to the performance in the first half of the year. In the second half of 2000, demand decreased and import levels increased significantly – a trend that continued in 2001. The decrease in net sales in 2001 was mitigated to some extent by increased volume in our steel mills segment.

Nucor established new annual tonnage records in the steel mills segment for total shipments and shipments to outside customers in 2002. Total shipments were 13,438,000 tons in 2002, compared with 12,141,000 tons in 2001 and 10,980,000 tons in 2000. Steel sales to outside customers were 12,314,000 tons in 2002, compared with 11,032,000 tons in 2001 and 9,779,000 tons in 2000. In the steel products segment, production and shipment volumes were generally lower. Steel joist production for 2002 was 462,000 tons, compared with 532,000 tons in 2001 and 613,000 tons in 2000. Steel deck sales were 330,000 tons in 2002, compared with 344,000 tons in 2001 and 353,000 tons in 2000. Cold finish steel sales were 226,000 tons in 2002, compared with 203,000 tons in 2001 and 250,000 tons in 2000.

COST OF PRODUCTS SOLD The major component of cost of products sold is raw material costs. The average price of raw materials increased 8% from 2001 to 2002. The average price of raw materials in the steel mills segment and the steel products segment increased 9% and 1%, respectively, in 2002. The average scrap and scrap substitute cost per ton used in our steel mills segment was $110 in 2002, an increase of 9% from $101 in 2001. By the fourth quarter of 2002, the average scrap cost per ton used had increased to $118.

The average price of raw materials decreased 13% from 2000 to 2001. The average price of raw materials in the steel mills segment and the steel products segment decreased by 14% and 10%, respectively, in 2001. The average scrap and scrap substitute cost per ton used in our steel mills segment decreased 16% to $101 in 2001 from $120 in 2000.

In December 2000, Nucor entered into a consent decree with the United States Environmental Protection Agency (“USEPA”) and certain states in order to resolve alleged environmental violations. Under the terms of this decree, Nucor will conduct testing at some of its facilities, perform corrective action where necessary, and pilot certain pollution control technologies. In conjunction with the consent decree, and other necessary facility remediation, Nucor increased environmental reserves by approximately $36,000,000 in 2000.

During 2001, Nucor made $21,000,000 in cash payments for remedial efforts including a $9,000,000 penalty payment to the USEPA in conjunction with the consent decree and $6,000,000 as a minimum settlement for a particular cleanup. Nucor also made net reductions to reserves of approximately $4,000,000 in 2001. As part of the consent decree, Resource Conservation and Recovery Act site initial assessments were nearly completed which more clearly defined probable exposures.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

During 2002, Nucor revised estimates for environmental reserves as additional information became available. Nucor made approximately $6,000,000 in cash payments for remedial efforts during 2002 and made approximately $23,000,000 in net reductions to reserves. The most significant components of the decrease related to an agreement with the USEPA that certain technologies identified in the consent decree were not feasible and a favorable court ruling that implicated additional potentially responsible parties for the cleanup of an off-site waste-recycling facility.

GROSS MARGIN Gross margins were 10% in 2002 and 2001 and 17% in 2000. In addition to the net sales and cost of products sold factors discussed above, gross margins were affected by pre-operating and start-up costs at several Nucor facilities. Pre-operating and start-up costs of new facilities were $84,400,000 in 2002, compared with $97,800,000 in 2001 and $50,900,000 in 2000. In 2002, these costs primarily related to the start-up of the newly acquired sheet mill in Decatur, Alabama ($31,400,000) and the new Castrip facility at our sheet mill in Crawfordsville, Indiana ($23,500,000). In 2001, these costs primarily related to the start-up of the new plate mill in Hertford County, North Carolina and the new Vulcraft facility in Chemung, New York.

We expect our Decatur facility to operate near full capacity by the fourth quarter of 2003 and start-up expenses to be completed in that period. Our Castrip facility is an experimental implementation of a new steel making technology; therefore, it is uncertain when start-up expenses for that operation will end.

MARKETING, ADMINISTRATIVE AND OTHER EXPENSES The major components of marketing, administrative and other expenses are freight and profit sharing costs. Unit freight costs were unchanged from 2001 to 2002. Profit sharing costs, which are based upon and fluctuate with pre-tax earnings, increased by 69% from 2001 to 2002. Unit freight costs increased less than 5% from 2000 to 2001. Profit sharing costs decreased 73% from 2000 to 2001. In 2000, profit sharing costs included over $6,200,000 for an extraordinary bonus paid to employees for the achievement of record earnings during the year. Every employee except for senior officers received $800.

INTEREST EXPENSE (INCOME) Interest expense, net of interest income, increased in 2002 and 2001 as a result of increased average long-term debt and decreased average interest rates earned on short-term investments.

MINORITY INTERESTS Minority interests represent the income attributable to the minority partners of Nucor’s less than 100% owned joint venture, Nucor-Yamato Steel Company. Income attributable to minority interests was approximately $79,500,000 in 2002, $103,100,000 in 2001 and $151,500,000 in 2000. Cash distributions to minority interests were $146,700,000 in 2002, $120,500,000 in 2001 and $119,900,000 in 2000. Under the partnership agreement, the minimum amount of cash to be distributed each year to the partners of Nucor-Yamato Steel Company is the amount needed by each partner to pay applicable U.S. federal and state income taxes. In 2002 and 2001, the amount of cash distributed to minority interests exceeded amounts allocated to minority interests based on mutual agreement of the general partners; however, the cumulative amount of cash distributed to partners was less than the cumulative net earnings of the partnership.

OTHER INCOME In the second quarter of 2002, Nucor received $29,900,000 related to a graphite electrodes anti-trust settlement. In 2001, Nucor sold Nucor Iron Carbide, Inc. in Trinidad, resulting in a pre-tax gain of $20,200,000.

PROVISION FOR INCOME TAXES The effective tax rate was 29.55% in 2002 compared with 37.02% in 2001 and 37.00% in 2000. The lower tax rate in 2002 is primarily due to state income tax credits recognized in 2002. In the fourth quarter of 2002, Nucor recorded state income tax credits of $16,200,000, of which $6,100,000 is non-recurring.

NET EARNINGS The increase in 2002 net earnings resulted primarily from increased volume in the steel mills segment, partly offset by a decline in volume and earnings in the steel products segment caused by a depressed non-residential construction market. In addition, the increase in net earnings in 2002 compared to 2001 was attributable to decreased pre-operating and start-up costs, increased other income related to the graphite electrodes anti-trust settlement, and reductions in environmental reserves due to changes in estimates.

The decrease in 2001 earnings resulted primarily from decreased margins and increased pre-operating and start-up costs, partially offset by decreased profit sharing costs and decreased income taxes. Nucor’s net earnings were also favorably affected in the fourth quarter of 2001 by a gain of $20,200,000 related to the sale of Nucor Iron Carbide, Inc.

Earnings were 7% of average equity in 2002, compared with 5% in 2001 and 14% in 2000.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

LIQUIDITY AND CAPITAL RESOURCES

In 2002, working capital decreased 6% from $889,500,000 to $832,600,000. The current ratio was 2.4 in 2002, 2.8 in 2001 and 2.5 in 2000. We have a simple capital structure with no off-balance sheet arrangements or relationships with unconsolidated special purpose entities. Nucor sometimes uses natural gas purchase contracts to partially manage its exposure to the price risk of natural gas which is used during the manufacturing process. The use of these contracts is immaterial for all periods presented.

OPERATING ACTIVITIES Nucor generated cash provided by operating activities of $497,200,000 in 2002, compared with $495,100,000 in 2001 and $820,800,000 in 2000. Gross margins deteriorated in 2002 and 2001 due to depressed market conditions and increased pre-operating and start-up costs of new facilities. Additionally, in 2002, changes in operating assets and liabilities (exclusive of acquisitions and dispositions) used cash of $82,600,000, compared with changes in operating assets and liabilities using cash of $2,700,000 in 2001 and providing cash of $79,000,000 in 2000.

INVESTING ACTIVITIES Cash used in investing activities increased to $901,400,000 in 2002 compared with $360,400,000 in 2001 and $410,300,000 in 2000. Capital expenditures for new facilities and expansion of existing facilities decreased to $243,600,000 in 2002 compared with $261,100,000 in 2001 and $415,400,000 in 2000.

On July 22, 2002, Nucor acquired substantially all of the assets of Trico Steel Company, LLC (“Trico”) for a purchase price of $117,700,000. On December 9, 2002, Nucor acquired substantially all of the assets of Birmingham Steel Corporation (“Birmingham Steel”) for a cash purchase price excluding transaction costs of approximately $615,000,000, including $116,900,000 in inventory and receivables. In connection with these acquisitions, Nucor assumed $86,000,000 in bonds and $17,400,000 in other liabilities.

During 2001, Nucor sold Nucor Iron Carbide, Inc. and sold the assets of the Nucor Bearing Products facility. Total proceeds from these two sales as well as the sale of other equipment at existing facilities were $22,700,000 in 2001. Also in 2001, Nucor purchased substantially all of the assets of Auburn Steel Company, Inc.’s steel bar facility in Auburn, New York for approximately $115,000,000 and acquired ITEC Steel, Inc. (now called NUCON STEEL Commercial Corporation) for approximately $7,000,000 (excluding liabilities assumed).

FINANCING ACTIVITIES Cash provided by financing activities was $160,800,000 in 2002, compared with cash used in financing activities of $162,900,000 in 2001 and $492,100,000 in 2000. On October 1, 2002, Nucor issued $350,000,000 aggregate principal amount of 4.875% notes due 2012. During 2002 Nucor retired $1,900,000 aggregate principal amount of industrial revenue bonds. No additional long-term debt was incurred in 2001. Net long-term debt borrowings were $70,000,000 in 2000. Existing cash and short-term investments, and the $350,000,000 in new notes, funded the acquisition of the assets of Trico and Birmingham Steel in 2002. The acquisitions of the bar mill in Auburn, New York and of ITEC Steel, Inc. in 2001 were funded by Nucor’s existing cash and short-term investments. Unused long-term credit facilities total $425,000,000 at the end of 2002. The percentage of long-term debt to total capital (long-term debt plus minority interests plus stockholders’ equity) was 26% in 2002 and 16% in both 2001 and 2000.

Nucor’s directors have approved the purchase of up to 15,000,000 shares of Nucor common stock. There were no repurchases during 2002 or 2001. Since the inception of the stock repurchase program in 1998, a total of approximately 10,800,000 shares have been repurchased at a cost of about $444,500,000.

MARKET RISK Some of Nucor’s industrial revenue bonds have variable interest rates that are adjusted weekly, monthly or annually. Future changes in interest rates are not expected to significantly impact earnings. Additionallly, Nucor entered into an interest rate swap agreement, converting a note payable of $175,000,000 from a fixed rate obligation to a variable rate obligation. Nucor’s remaining debt is at fixed rates. Nucor’s investment practice is to invest in securities that are highly liquid with short maturities. As a result, we do not expect changes in interest rates to have a significant impact on the value of our investment securities.

20

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

CONTRACTUAL OBLIGATIONS AND OTHER COMMERCIAL COMMITMENTS The following table sets forth our contractual obligations and other commercial commitments as of December 31, 2002, not including related interest expense, if any, for the periods presented.

	Payments Due By Period
Contractual Obligations	Total		Less than 1 year		1-3 years		4-5 years		After 5 years
Long-term debt	$	894,550,000	$	16,000,000	$	1,250,000	$	—	$	877,300,000
Operating leases	4,013,000		1,083,000		2,679,000		251,000		—
Unconditional purchase obligations(1)	60,736,000		60,003,000		733,000		—		—
Other long-term obligations(2)	45,897,000		34,653,000		11,244,000		—		—
Total contractual cash obligations	$	1,005,196,000	$	111,739,000	$	15,906,000	$	251,000	$	877,300,000

	Amount of Commitment Expiration Per Period
Other Commercial Commitments	Total Amounts Committed		Less than 1 year		1-3 years		4-5 years		After 5 years
Guarantees(3)	$	3,500,000	$	3,500,000	$	—	$	—	$	—

(1)Purchase obligations on operating machinery and equipment.

(2)Our share of estimated costs to construct and start-up the joint venture HIsmelt mill in Western Australia.

(3)Financial guarantees on environmental remediation.

OUTLOOK Nucor’s objective is to maintain a strong balance sheet. Capital expenditures are currently projected to be less than $300,000,000 in 2003. Funds provided from operations, existing credit facilities and new borrowings are expected to be adequate to meet future capital expenditure and working capital requirements for existing operations. Nucor believes that it has the financial ability to borrow significant additional funds and still maintain reasonable leverage in order to finance major acquisitions.

The past year was one of the toughest that the steel industry has experienced in decades. Nucor’s earnings in 2003 will be impacted by the state of the economy, specifically the construction industry, and the maintenance and implementation of remedies for relief from dumped steel imports.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at year-end, and the reported amount of revenues and expenses during the year. On an ongoing basis, we evaluate our estimates, including those related to the valuation allowances for receivables, the carrying value of property, plant and equipment and environmental obligations. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Accordingly, actual costs could differ materially from these estimates under different assumptions or conditions.

We believe the following critical accounting policies affect our significant judgments and estimates used in the preparation of our consolidated financial statements

ALLOWANCES FOR DOUBTFUL ACCOUNTS We maintain allowances for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments. If the financial condition of our customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required.

ASSET IMPAIRMENTS We evaluate the impairment of our property, plant and equipment on an individual asset basis or by logical groupings of assets. Asset impairments are recognized whenever changes in circumstances indicate that the carrying amount of those productive assets exceeds their aggregate projected undiscounted cash flows.

ENVIRONMENTAL REMEDIATION We are subject to environmental laws and regulations established by federal, state and local authorities, and make provision for the estimated costs related to compliance. Undiscounted remediation liabilities are accrued based on estimates of known environmental exposures. The accruals are reviewed periodically and, as investigations and remediation proceed, adjustments are made as we believe are necessary. The accruals are not reduced by possible recoveries from insurance carriers or other third parties, and do not reflect anticipated allocations among potentially responsible parties at federal Superfund sites or similar state-managed sites after an assessment is made of the likelihood that such parties will fulfill their obligations at such sites. Our measurement of environmental liabilities is based on currently available facts, present laws and regulations, and current technology.

21

SIX-YEAR FINANCIAL REVIEW

	2002			2001			2000			1999			1998			1997
FOR THE YEAR
Net sales	$	4,801,776,537		$	4,333,706,754		$	4,756,521,134		$	4,158,293,140		$	4,305,450,408		$	4,339,951,794
Costs and expenses:
Cost of products sold	4,332,277,330			3,914,278,371			3,929,181,904			3,531,896,413			3,632,637,842			3,625,212,399
Marketing, administrative and other expenses	175,588,347			150,665,488			183,175,557			154,773,600			147,973,101			145,409,693
Interest expense (income)	14,285,934			6,525,057			(816,104		)	(5,095,299		)	(3,832,252		)	(35,318		)
Minority interests	79,471,911			103,068,831			151,461,789			85,783,332			91,641,121			90,516,580
Other income	(29,900,000		)	(20,200,000		)	—			—			—			—
	4,571,723,522			4,154,337,747			4,263,003,146			3,767,358,046			3,868,419,812			3,861,103,354
Earnings before income taxes	230,053,015			179,369,007			493,517,988			390,935,094			437,030,596			478,848,440
Provision for income taxes	67,973,000			66,408,000			182,610,000			146,346,000			173,322,000			184,366,000
Net earnings	162,080,015			112,961,007			310,907,988			244,589,094			263,708,596			294,482,440
Net earnings per share:
Basic	2.08			1.45			3.80			2.80			3.00			3.35
Diluted	2.07			1.45			3.80			2.80			3.00			3.35
Dividends declared per share	.76			.68			.60			.52			.48			.40
Percentage of earnings to sales	3.4		%	2.6		%	6.5		%	5.9		%	6.1		%	6.8		%
Return on average equity	7.2		%	5.2		%	14.2		%	11.3		%	13.4		%	16.9		%
Capital expenditures	243,598,096			261,145,658			415,404,602			374,717,759			502,910,263			306,749,422
Depreciation	307,101,032			289,063,213			259,365,173			256,637,460			264,038,622			218,764,101
Sales per employee	527,581			530,961			619,379			568,112			613,574			645,682
AT YEAR END
Current assets	$	1,424,138,700		$	1,373,665,916		$	1,379,529,050		$	1,538,508,511		$	1,129,467,383		$	1,125,508,464
Current liabilities	591,535,828			484,158,726			558,068,452			531,030,898			486,897,157			524,453,610
Working capital	832,602,872			889,507,190			821,460,598			1,007,477,613			642,570,226			601,054,854
Current ratio	2.4			2.8			2.5			2.9			2.3			2.1
Property, plant and equipment	2,932,058,102			2,365,655,061			2,329,420,798			2,180,419,463			2,086,158,459			1,858,874,894
Total assets	4,381,001,217			3,759,348,176			3,710,867,705			3,718,927,974			3,215,625,842			2,984,383,358
Long-term debt	878,550,000			460,450,000			460,450,000			390,450,000			215,450,000			167,950,000
Percentage of debt to capital	26.0		%	15.6		%	15.9		%	13.4		%	8.4		%	7.2		%
Stockholders’ equity	2,322,989,489			2,201,460,329			2,130,951,640			2,262,247,906			2,072,551,781			1,876,425,866
Per share	29.71			28.29			27.47			25.96			23.73			21.32
Shares outstanding	78,180,108			77,814,511			77,582,948			87,133,737			87,352,906			87,996,583
Stockholders	64,000			47,000			51,000			55,000			62,000			50,000
Employees	9,800			8,400			7,900			7,500			7,200			6,900

Certain amounts for prior years have been reclassified to conform to the 2002 presentation.

25

CONSOLIDATED STATEMENTS OF EARNINGS AND STOCKHOLDERS’ EQUITY

CONSOLIDATED STATEMENTS OF EARNINGS

Year Ended December 31,	2002			2001			2000
NET SALES	$	4,801,776,537		$	4,333,706,754		$	4,756,521,134
COSTS AND EXPENSES:
Cost of products sold	4,332,277,330			3,914,278,371			3,929,181,904
Marketing, administrative and other expenses	175,588,347			150,665,488			183,175,557
Interest expense (income), net (Note 10)	14,285,934			6,525,057			(816,104		)
Minority interests	79,471,911			103,068,831			151,461,789
Other income (Note 11)	(29,900,000		)	(20,200,000		)	—
	4,571,723,522			4,154,337,747			4,263,003,146
EARNINGS BEFORE INCOME TAXES	230,053,015			179,369,007			493,517,988
PROVISION FOR INCOME TAXES (Note 12)	67,973,000			66,408,000			182,610,000
NET EARNINGS	$	162,080,015		$	112,961,007		$	310,907,988
NET EARNINGS PER SHARE (Note 13):
Basic	$	2.08		$	1.45		$	3.80
Diluted	$	2.07		$	1.45		$	3.80

See notes to consolidated financial statements.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

	COMMON STOCK										TREASURY STOCK (at cost)
	Shares		Amount		ADDITIONAL PAID-IN CAPITAL			RETAINED EARNINGS			Shares		Amount
BALANCES, December 31, 1999	90,102,518		$	36,041,007	$	70,906,567		$	2,216,091,023		2,968,781		$	60,790,691
Net earnings in 2000								310,907,988
Employee stock options	9,620		3,848		409,508
Employee stock compensation and service awards					401,879						(108,647	)	(3,921,444		)
Treasury stock acquired					(223,284		)				9,669,056		398,504,348
Cash dividends ($.60 per share)								(48,213,301		)
BALANCES, December 31, 2000	90,112,138		36,044,855		71,494,670			2,478,785,710			12,529,190		455,373,595
Net earnings in 2001								112,961,007
Employee stock options	214,253		85,701		8,830,541
Employee stock compensation and service awards					864,944						(17,310	)	(629,219		)
Cash dividends ($.68 per share)								(52,862,723		)
BALANCES, December 31, 2001	90,326,391		36,130,556		81,190,155			2,538,883,994			12,511,880		454,744,376
Net earnings in 2002								162,080,015
Employee stock options	352,242		140,897		16,088,074
Employee stock compensation and service awards					2,117,577						(13,355	)	(485,454		)
Cash dividends ($.76 per share)								(59,382,857		)
BALANCES, December 31, 2002		90,678,633	$	36,271,453	$	99,395,806		$	2,641,581,152		12,498,525		$	454,258,922

See notes to consolidated financial statements.

26

CONSOLIDATED BALANCE SHEETS

December 31,	2002			2001
ASSETS
CURRENT ASSETS:
Cash and short-term investments	$	219,004,868		$	462,348,547
Accounts receivable (Note 2)	483,607,972			330,855,074
Inventories (Note 3)	588,989,548			466,690,217
Other current assets	132,536,312			113,772,078
Total current assets	1,424,138,700			1,373,665,916
PROPERTY, PLANT AND EQUIPMENT (Note 4)	2,932,058,102			2,365,655,061
OTHER ASSETS	24,804,415			20,027,199
	$	4,381,001,217		$	3,759,348,176
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Long-term debt due within one year (Note 5)	$	16,000,000		$	—
Accounts payable	247,229,067			189,235,046
Federal income taxes	8,948,999			—
Salaries, wages and related accruals	116,246,817			92,769,688
Accrued expenses and other current liabilities (Note 8)	203,110,945			202,153,992
Total current liabilities	591,535,828			484,158,726
LONG-TERM DEBT DUE AFTER ONE YEAR (Note 5)	878,550,000			460,450,000
DEFERRED CREDITS AND OTHER LIABILITIES (Notes 8, 9 and 12)	371,271,399			329,392,145
MINORITY INTERESTS	216,654,501			283,886,976
STOCKHOLDERS’ EQUITY (Note 6):
Common stock	36,271,453			36,130,556
Additional paid-in capital	99,395,806			81,190,155
Retained earnings	2,641,581,152			2,538,883,994
	2,777,248,411			2,656,204,705
Treasury stock	(454,258,922		)	(454,744,376		)
Total stockholders’ equity	2,322,989,489			2,201,460,329
	$	4,381,001,217		$	3,759,348,176

See notes to consolidated financial statements.

27

CONSOLIDATED STATEMENTS OF CASH FLOWS

Year Ended December 31,	2002			2001			2000
OPERATING ACTIVITIES
Net earnings	$	162,080,015		$	112,961,007		$	310,907,988
Adjustments:
Depreciation	307,101,032			289,063,213			259,365,173
Gain on sale of facility	—			(20,200,000		)	—
Deferred income taxes	31,200,000			13,000,000			20,200,000
Minority interests	79,468,625			103,034,717			151,275,438
Changes in (exclusive of acquisitions and dispositions):
Accounts receivable	(99,777,898		)	33,788,641			43,579,322
Inventories	(58,371,867		)	26,302,845			3,831,738
Accounts payable	57,994,021			(20,991,631		)	(51,895,123		)
Accrued environmental costs	(22,192,000		)	(25,187,000		)	30,932,000
Other	39,717,977			(16,656,467		)	52,558,131
Cash provided by operating activities	497,219,905			495,115,325			820,754,667
INVESTING ACTIVITIES
Capital expenditures	(243,598,096		)	(261,145,658		)	(415,404,602		)
Investment in affiliates	(5,573,268		)	—			—
Disposition of plant and equipment	448,546			22,650,119			5,128,217
Acquisitions (net of cash acquired)	(652,688,811		)	(121,904,000		)	—
Cash used in investing activities	(901,411,629		)	(360,399,539		)	(410,276,385		)
FINANCING ACTIVITIES
Increase in long-term debt	350,000,000			—			70,000,000
Repayment of long-term debt	(1,900,000		)	—			—
Issuance of common stock	18,832,002			10,410,405			4,736,679
Distributions to minority interests	(146,701,100		)	(120,491,200		)	(119,883,200		)
Cash dividends	(59,382,857		)	(52,862,723		)	(48,213,301		)
Acquisition of treasury stock	—			—			(398,727,632		)
Cash provided by (used in) financing activities	160,848,045			(162,943,518		)	(492,087,454		)
DECREASE IN CASH AND SHORT-TERM INVESTMENTS	(243,343,679		)	(28,227,732		)	(81,609,172		)
CASH AND SHORT-TERM INVESTMENTS – BEGINNING OF YEAR	462,348,547			490,576,279			572,185,451
CASH AND SHORT-TERM INVESTMENTS – END OF YEAR	$	219,004,868		$	462,348,547		$	490,576,279

See notes to consolidated financial statements.

28

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

NATURE OF OPERATIONS Nucor is a domestic manufacturer of steel products whose customers are located primarily in the United States of America.

PRINCIPLES OF CONSOLIDATION The consolidated financial statements include Nucor and all of its subsidiaries. All significant intercompany transactions are eliminated. Investments in joint ventures with ownership of 50% or less are accounted for under the equity method. Distributions are made to minority interest partners in Nucor-Yamato Steel Company in accordance with the limited partnership agreement by mutual agreement of the general partners. At a minimum, sufficient cash is distributed so that each partner may pay applicable U.S. federal and state income taxes payable.

CASH AND SHORT-TERM INVESTMENTS Short-term investments are recorded at cost plus accrued interest, which approximates market, and have original maturities of three months or less at the date of purchase. Cash and short-term investments are maintained primarily with a few high-credit quality financial institutions.

INVENTORIES VALUATION Inventories are stated at the lower of cost or market. Cost is determined principally using the last-in, first-out (LIFO) method of accounting.

PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment are stated at cost. Depreciation is provided on a straight-line basis over the estimated useful lives of the assets. Repairs and maintenance are expensed on a pro-rata basis throughout the year. Long-lived assets are reviewed for impairment whenever changes in circumstances indicate that the carrying amount of the assets may not be recoverable.

NATURAL GAS CONTRACTS Nucor sometimes uses natural gas purchase contracts to partially manage its exposure to the price risk of natural gas used during the manufacturing process. The use of these contracts is immaterial for all periods presented.

REVENUE RECOGNITION Revenue is recognized at the time products are shipped to customers. Prior to 2002, some of the shipping costs incurred were recorded in net sales as an offset to the amounts billed to customers for the shipping costs. Nucor has reclassified the shipping costs as cost of products sold for all years presented. The effect of the reclassifications increased net sales and cost of products sold by $233,500,854, $194,458,176 and $170,375,153 in 2002, 2001 and 2000, respectively. Operating results were not affected by the reclassification. Internal fleet and some common carrier costs are included in marketing, administrative and other expenses. These costs included in marketing, administrative and other expenses were $43,917,530 in 2002, $48,282,035 in 2001 and $52,949,732 in 2000.

ACCOUNTING FOR STOCK OPTIONS Nucor accounts for stock options granted to employees and directors using the intrinsic value method, under which no compensation expense is recorded since the exercise price of the stock options is equal to the market price of the underlying stock on the grant date. Had compensation cost for the stock options issued been determined consistent with FASB Statement No. 123, “Accounting for Stock-Based Compensation” (“SFAS No. 123”), net earnings and net earnings per share would have been reduced to the following pro forma amounts:

Year Ended December 31,	2002			2001			2000
Net earnings – as reported	$	162,080,015		$	112,961,007		$	310,907,988
Pro forma stock-based compensation cost	(5,172,756		)	(4,463,762		)	(4,324,257		)
Net earnings – pro forma	$	156,907,259		$	108,497,245		$	306,583,731
Net earnings per share – as reported:
Basic	$	2.08		$	1.45		$	3.80
Diluted	2.07			1.45			3.80
Net earnings per share – pro forma:
Basic	2.02			1.40			3.75
Diluted		2.01			1.40			3.75

USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual costs could differ from these estimates.

RECLASSIFICATIONS Certain amounts for prior years have been reclassified to conform to the 2002 presentation.

29

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

2. ACCOUNTS RECEIVABLE:

An allowance for doubtful accounts is maintained for estimated losses resulting from the inability of our customers to make required payments. Accounts receivable are stated net of the allowance for doubtful accounts of $20,040,651 in 2002 ($20,182,830 in 2001 and $27,573,485 in 2000).

3. INVENTORIES:

Inventories consist of approximately 40% raw materials and supplies, and 60% finished and semi-finished products in 2002 and 2001. Nucor’s manufacturing process consists of a continuous, vertically integrated process from which products are sold to customers at various stages throughout the process. Since most steel products can be classified as either finished or semi-finished products, these two categories of inventory are combined.

Inventories valued using the last-in, first-out (LIFO) method of accounting represent approximately 77% of total inventories in 2002 (85% in 2001). If the first-in, first-out (FIFO) method of accounting had been used, inventories would have been $42,607,667 higher in 2002 ($8,291,126 higher in 2001). Use of the lower of cost or market reduced inventories by $1,319,314 in 2002 ($6,319,664 in 2001).

4. PROPERTY, PLANT AND EQUIPMENT:

December 31,	2002		2001
Land and improvements	$	122,624,444	$	99,960,257
Buildings and improvements	452,382,223		387,104,084
Machinery and equipment	4,475,430,898		3,605,131,629
Construction in process and equipment deposits	43,793,154		134,370,438
	5,094,230,719		4,226,566,408
Less accumulated depreciation	2,162,172,617		1,860,911,347
	$	2,932,058,102	$	2,365,655,061

The estimated useful lives range from 10 to 20 years for buildings and land improvements and range from 3 to 12 years for machinery and equipment.

5. LONG-TERM DEBT AND FINANCING ARRANGEMENTS:

December 31,	2002			2001
Industrial revenue bonds:
1.63% to 2.475%, variable, due from 2014 to 2033	$	292,300,000		$	206,300,000
5.75% to 8%, fixed, due from 2003 to 2023	77,250,000			79,150,000
Notes, 6%, due 2009	175,000,000			175,000,000
Notes, 4.875%, due in 2012	350,000,000			—
	894,550,000			460,450,000
Less current maturities	(16,000,000		)	—
	$	878,550,000		$	460,450,000

30

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

At December 31, 2002, Nucor had an interest rate swap agreement of $175,000,000 outstanding that is accounted for as a fair value hedge. Under the agreement, Nucor pays a variable rate of interest and receives a fixed rate of interest over the term of the interest rate swap agreement. The interest rate swap agreement converted the $175,000,000 note payable from a fixed rate obligation to a variable rate obligation. The change in the fair value of this agreement is recorded in earnings as an equal offset to the change in fair value of the underlying debt obligation. Since this fair value hedge is 100% effective, there is no impact to net earnings. The variable interest rate is the six-month LIBOR rate in arrears plus 1.495%.

In October 2002, Nucor entered into an unsecured revolving credit facility that provides for up to $425,000,000 in revolving loans. The credit facility consists of (a) a $125,000,000 364-day revolver with an option to convert amounts outstanding under this facility to a one-year term loan, and (b) a $300,000,000 five-year multi-currency revolver. This new facility replaced the previous credit facilities that provided up to $248,000,000 in revolving loans. No borrowings were outstanding under the former credit facilities as of the date they were replaced, and no borrowings are outstanding under the new credit facility at December 31, 2002. The new credit facility includes customary financial and other covenants, including a limit on the ratio of debt to total capital of 50% and a limit on Nucor’s ability to pledge the Company’s assets.

Annual aggregate long-term debt maturities are: $16,000,000 in 2003; none in 2004; none in 2005; $1,250,000 in 2006; and none in 2007.

The fair value of Nucor’s long-term debt approximates the carrying value.

In January 2003, approximately $45,000,000 aggregate principal amounts of the fixed rate industrial revenue bonds outstanding at December 31, 2002 were redeemed and reissued in the form of new variable rate industrial revenue bonds in like principal amount.

6. CAPITAL STOCK:

The par value of Nucor’s common stock is $.40 per share and there are 200,000,000 shares authorized.

Nucor’s Key Employees’ Incentive Stock Option Plans provide that common stock options may be granted to key employees and officers with exercise prices at 100% of the market value on the date of the grant. Outstanding options are exercisable six months after grant date and have a term of seven years. At December 31, 2002, 1,291,962 shares (1,737,789 in 2001 and 2,180,737 in 2000) were reserved for future grants.

Effective January 1, 2001, Nucor established a Non-Employee Director Equity Plan that provides that common stock options may be granted to members of the Board of Directors of Nucor who are not employees of Nucor. The Plan grants options to purchase Nucor’s common stock with exercise prices at 100% of the market value on the date of the grant. Outstanding options are exercisable six months after grant date and have a term of seven years. At December 31, 2002, 291,525 shares (295,689 in 2001) were reserved for future grants.

250,000 shares of preferred stock, par value of $4.00 per share, are authorized, with preferences, rights and restrictions as may be fixed by Nucor’s Board of Directors. No shares of preferred stock have been issued since their authorization in 1964.

A summary of Nucor’s stock option plans is as follows:

Year Ended December 31,	2002				2001				2000
	Shares		Weighted Average Exercise Price		Shares		Weighted Average Exercise Price		Shares		Weighted Average Exercise Price
Number of shares under option:
Outstanding at beginning of year	1,154,864		$	45.48	990,630		$	44.60	685,317		$	48.35
Granted	458,810		52.66		470,338		46.64		482,431		41.33
Exercised	(352,242	)	46.07		(214,253	)	41.62		(9,620	)	42.60
Canceled	(15,346	)	54.88		(91,851	)	51.02		(167,498	)	50.65
Outstanding at end of year	1,246,086		$	47.84	1,154,864		$	45.48	990,630		$	44.60
Options exercisable at end of year	993,331		$	47.54	924,932		$	44.61	710,386		$	47.93

31

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

The following table summarizes information about stock options outstanding at December 31, 2002:

	Options Outstanding						Options Exercisable
Range of Exercise Prices	Number Outstanding		Weighted- Average Remaining Contractual Life		Weighted-Average Exercise Price		Number Exercisable		Weighted-Average Exercise Price
$36.01 –$42.00	161,434		4.2 years		$	36.59	161,434		$	36.59
42.01 –  48.00	279,277		4.4 years		44.89		279,277		44.89
48.01 –  54.00	605,893		5.5 years		49.09		353,138		49.16
54.01 –  60.00	199,482		6.1 years		57.25		199,482		57.25
36.01 –  60.00		1,246,086		5.2 years		47.84		993,331		47.54

The pro forma net earnings and pro forma net earnings per share amounts calculated according to SFAS No. 123 are disclosed in Note 1, above. The weighted-average fair value of options granted was $18.69 in 2002 ($14.59 in 2001 and $16.54 in 2000). The fair value of each option grant is estimated on the date of the grant using the Black-Scholes option-pricing model with the following assumptions:

Year Ended December 31,	2002		2001		2000
Expected dividend yield	1.55	%	1.39	%	1.66	%
Expected stock price volatility	49.03	%	41.02	%	40.57	%
Risk-free interest rate	2.32% – 4.14	%	3.45% – 4.43	%	6.02% – 6.53	%
Expected life of options (in years)	3.5		3.5		3.5

7. STOCKHOLDER RIGHTS PLAN:

On March 8, 2001, the Board of Directors adopted a Stockholder Rights Plan (“Plan”) in which one right (“Right”) was declared as a dividend for each Nucor common share outstanding. Each Right entitles Nucor common stockholders to purchase, under certain conditions, one five-thousandth of a share of newly authorized Series A Junior Participating Preferred Stock (“Preferred Stock”), with one five-thousandth of a share of Preferred Stock intended to be the economic equivalent of one share of Nucor common stock. Until the occurrence of certain events, the Rights are represented by and traded in tandem with Nucor common stock. Rights will be exercisable only if a person or group acquires beneficial ownership of 15 percent (15%) or more of the Nucor common shares or commences a tender or exchange offer, upon the consummation of which such person or group would beneficially own 15 percent (15%) or more of the common shares. Upon such an event, the Rights enable dilution of the acquiring person’s or group’s interest by providing that other holders of Nucor common stock may purchase, at an exercise price of $150.00, Nucor common stock, or in the discretion of the Board of Directors, Preferred Stock, having double the value of such exercise price. Nucor will be entitled to redeem the Rights at $.001 per Right under certain circumstances set forth in the Plan. The Rights themselves have no voting power and will expire on March 8, 2011, unless earlier exercised, redeemed or exchanged. Each one five-thousandth of a share of Preferred Stock has the same voting rights as one share of Nucor common stock, and each share of Preferred Stock has 5,000 times the voting power of one share of Nucor common stock.

32

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

8. CONTINGENCIES:

Nucor is subject to environmental laws and regulations established by federal, state and local authorities; and makes provision for the estimated costs related to compliance. Of the undiscounted total $82,768,000 of accrued environmental costs at December 31, 2002 ($104,960,000 in 2001 and $130,147,000 in 2000), $37,418,000 was classified in accrued expenses and other current liabilities ($49,210,000 in 2001 and $63,097,000 in 2000) and $45,350,000 was classified in deferred credits and other liabilities ($55,750,000 in 2001 and $67,050,000 in 2000). During the year ended December 31, 2002, Nucor revised estimates as additional information was obtained. Environmental reserves included in deferred credits and other liabilities decreased by $22,943,000 during the year as a result of the revised estimates. In December 2000, the United States Environmental Protection Agency and the Department of Justice announced an agreement with Nucor and certain states that resolved alleged environmental violations. Nucor continues to implement the various components of the consent decree, which involve air and water pollution control technology demonstrations along with other environmental management practices. The accrued environmental costs include the expenses that we expect to incur as a result of the consent decree.

Other contingent liabilities with respect to product warranties, legal proceedings and other matters arise in the normal course of business. In the opinion of management, no such matters exist which would have a material effect on the consolidated financial statements.

9. EMPLOYEE BENEFIT PLAN:

Nucor has a Profit Sharing and Retirement Savings Plan for qualified employees. Nucor’s expense for these benefits was $25,898,823 in 2002 ($18,998,950 in 2001 and $49,280,977 in 2000). Nucor also has a medical plan covering certain eligible early retirees. The unfunded obligation, included in deferred credits and other liabilities in the balance sheet, totaled $38,211,081 in 2002 ($33,256,696 in 2001). Expense associated with this plan was $1,753,035 in 2002 ($1,085,758 in 2001 and $3,038,714 in 2000). The discount rate used was 6.5% in 2002 (7% in 2001 and 7.5% in 2000). The health care cost trend rate used was 12% in 2002 (13% in 2001 and 9.5% in 2000). The health care cost trend rate is projected to decline gradually to 5% by 2011.

10. INTEREST EXPENSE (INCOME):

Interest expense is stated net of interest income of $8,632,181 in 2002 ($15,476,840 in 2001 and $23,264,824 in 2000). Interest paid was $19,886,247 in 2002 ($22,028,671 in 2001 and $21,625,267 in 2000).

11. OTHER INCOME:

In 2002, Nucor received $29,900,000 related to a graphite electrodes anti-trust settlement. In 2001, Nucor sold Nucor Iron Carbide, Inc. in Trinidad, resulting in a pre-tax gain of $20,200,000.

12. INCOME TAXES:

The provision for income taxes consists of the following:

Year Ended December 31,	2002			2001		2000
Current:
Federal	$	54,000,000		$	49,900,000	$	148,000,000
State	(17,227,000		)	3,508,000		14,410,000
Total current	36,773,000			53,408,000		162,410,000
Deferred:
Federal	31,400,000			11,000,000		19,400,000
State	(200,000		)	2,000,000		800,000
Total deferred	31,200,000			13,000,000		20,200,000
Total provision for income taxes	$	67,973,000		$	66,408,000	$	182,610,000

33

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

A reconciliation of the federal statutory tax rate (35%) to the total provision is as follows:

Year Ended December 31,	2002		2001		2000
Taxes computed at statutory rate	35.00	%	35.00	%	35.00	%
State income taxes, net of federal income tax benefit	(4.92	)	2.00		2.00
Penalties	—		1.77		—
Other, net	(.53	)	(1.75	)	—
Provision for income taxes	29.55	%	37.02	%	37.00	%

Deferred tax assets and liabilities resulted from the following:

December 31,	2002			2001
Deferred tax assets:
Accrued liabilities and reserves	$	114,759,338		$	106,829,351
Allowance for doubtful accounts	6,271,704			6,457,742
Inventory	69,957,269			68,725,327
Post retirement benefits	13,878,074			12,078,666
Total deferred tax assets	204,866,385			194,091,086
Deferred tax liabilities:
Property, plant and equipment	(273,173,385		)	(237,091,086		)
Total net deferred tax liabilities	$	(68,307,000	)	$	(43,000,000	)

Net federal and state income taxes paid were $31,693,000 in 2002 ($20,397,000 in 2001 and $162,339,000 in 2000).

13. EARNINGS PER SHARE:

The computations of basic and diluted earnings per share are as follows:

Year Ended December 31,	2002		2001		2000
Basic earnings per share:
Basic net earnings	$	162,080,015	$	112,961,007	$	310,907,988
Average shares outstanding	78,089,501		77,707,832		81,762,429
Basic net earnings per share	$	2.08	$	1.45	$	3.80
Diluted earnings per share:
Diluted net earnings	$	162,080,015	$	112,961,007	$	310,907,988
Diluted average shares outstanding:
Basic shares outstanding	78,089,501		77,707,832		81,762,429
Dilutive effect of stock options	160,039		75,412		14,825
	78,249,540		77,783,244		81,777,254
Diluted net earnings per share	$	2.07	$	1.45	$	3.80

34

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

14. SEGMENTS:

Nucor reports its results in two segments, steel mills and steel products. The steel mills segment includes carbon and alloy steel in sheet, bars, structural and plate. The steel products segment includes steel joists and joist girders, steel deck, cold finished steel, steel fasteners, metal building systems and light gauge steel framing. The segments are consistent with the way Nucor manages its business, which is primarily based upon the similarity of the types of products produced and sold by each segment.

Management evaluates the operating performance of each of its segments based upon division contribution. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies. Nucor accounts for intercompany sales at prices approximating current market value. Interest expense (income), minority interests, other income and certain marketing, administrative and other expenses, such as changes in the LIFO reserve and environmental accruals, are shown under Corporate/eliminations/other. Corporate assets primarily include cash and short-term investments, deferred income tax assets and investments in affiliates.

Year Ended December 31,	2002			2001			2000
Net sales to external customers:
Steel mills	$	4,062,589,428		$	3,449,645,631		$	3,614,182,529
Steel products	739,187,109			884,061,123			1,142,338,605
	$	4,801,776,537		$	4,333,706,754		$	4,756,521,134
Intercompany sales:
Steel mills	$	355,586,154		$	337,776,416		$	429,505,350
Steel products	5,350,019			6,492,677			7,463,767
Corporate/eliminations/other	(360,936,173		)	(344,269,093		)	(436,969,117		)
	$	—		$	—		$	—
Depreciation expense:
Steel mills	$	288,879,257		$	274,015,541		$	248,139,764
Steel products	18,221,775			15,047,672			11,225,409
	$	307,101,032		$	289,063,213		$	259,365,173
Earnings before income taxes:
Steel mills	$	401,820,248		$	207,358,153		$	562,416,100
Steel products	(407,489		)	98,405,118			171,787,255
Corporate/eliminations/other	(171,359,744		)	(126,394,264		)	(240,685,367		)
	$	230,053,015		$	179,369,007		$	493,517,988
Segment assets:
Steel mills	$	4,017,013,672		$	3,253,454,574		$	3,216,124,842
Steel products	302,444,958			297,581,986			336,062,351
Corporate/eliminations/other	61,542,587			208,311,616			158,680,512
	$	4,381,001,217		$	3,759,348,176		$	3,710,867,705
Capital expenditures:
Steel mills	$	237,528,578		$	206,561,688		$	389,809,591
Steel products	6,069,518			53,482,338			25,595,011
Corporate/eliminations/other	—			1,101,632			—
	$	243,598,096		$	261,145,658		$	415,404,602

35

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

Net sales by product were as follows. Further product breakdown is impracticable.

Year Ended December 31,	2002		2001		2000
Net sales to external customers:
Sheet	$	1,905,516,770	$	1,421,651,648	$	1,524,409,147
Bars	863,373,558		804,899,153		745,676,938
Structural	1,026,991,446		1,073,351,752		1,338,440,460
Plate	266,707,654		149,743,078		5,655,984
Steel products	739,187,109		884,061,123		1,142,338,605
	$	4,801,776,537	$	4,333,706,754	$	4,756,521,134

15. ACQUISITIONS AND DISPOSITIONS:

On July 22, 2002, Nucor’s wholly owned subsidiary, Nucor Steel Decatur, LLC, purchased substantially all of the assets of Trico Steel Company, LLC (“Trico”) for a purchase price of $117,700,000. The purchase price included approximately $86,000,000 of Trico’s debt that was assumed by Nucor. Located in Decatur, Alabama, the sheet steel facility originally began operations in 1997 and has an annual capacity of approximately 1,900,000 tons. This acquisition was not material to the consolidated financial statements and did not result in material goodwill or other intangible assets.

On December 9, 2002, Nucor purchased substantially all of the assets of Birmingham Steel Corporation (“Birmingham Steel”) for a cash purchase price excluding transaction costs of approximately $615,000,000, including $116,900,000 in inventory and receivables. Primary assets purchased are Birmingham Steel’s four operating mills in Birmingham, Alabama; Kankakee, Illinois; Jackson, Mississippi; and Seattle, Washington with an estimated combined annual capacity of approximately 2,000,000 tons. Other included assets are the corporate office located in Birmingham, Alabama; the mill in Memphis, Tennessee, which is currently not in operation; the assets of Port Everglades Steel Corporation; the assets of the Klean Steel Division; and Birmingham Steel’s ownership in Richmond Steel Recycling Limited. This acquisition was financed with proceeds from the issuance of $350,000,000 of 4.875% notes due in 2012 and internal cash flows.

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed of Birmingham Steel as of the date of acquisition:

Current assets	$	122,868,464
Property, plant and equipment	515,016,742
Other assets	550,000
Total assets acquired	638,435,206
Current liabilities	(13,690,000		)
Deferred credits and other liabilities	(3,121,443		)
Total liabilities assumed	(16,811,443		)
	$	621,623,763

36

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

The results of Birmingham Steel have been included in the consolidated financial statements from the date of acquisition. Unaudited pro forma operating results for Nucor, assuming the acquisition of Birmingham Steel occurred on January 1, 2001, are as follows:

Year Ended December 31,	2002		2001
Net sales	$	5,292,505,537	$	4,884,697,754
Net earnings	156,837,015		128,994,007
Net earnings per share:
Basic	$	2.01	$	1.66
Diluted	$	2.00	$	1.66

Non-cash investing and financing activities in 2002 included the assumption of $86,000,000 of bonds and $17,415,025 of other liabilities acquired with the purchase of substantially all of the assets of Trico and Birmingham Steel.

On March 31, 2001, Nucor purchased substantially all of the assets of Auburn Steel Company, Inc.’s steel bar facility in Auburn, New York for approximately $115,000,000. This facility produces merchant bar quality steel shapes, SBQ and rebar. On November 19, 2001, Nucor acquired ITEC Steel, Inc. and its wholly owned subsidiary, Steel Truss and Frame Corp., with facilities in Texas and Georgia, for approximately $11,000,000, including liabilities assumed. These facilities, now known as NUCON STEEL Commercial Corporation, produce light gauge steel framing. The acquisitions were not material to the consolidated financial statements and did not result in material goodwill or other intangible assets.

In February 2001, Nucor finalized the sale of the Bearing Products operation in North Carolina. In November 2001, Nucor sold Nucor Iron Carbide, Inc. in Trinidad, resulting in a pre-tax gain of $20,200,000. Both operations accounted for small percentages of Nucor’s sales.

37

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

16.QUARTERLY INFORMATION (UNAUDITED):

Nucor has restated previously reported quarterly financial results for the years ended December 31, 2002 and 2001 to give effect to the reclassification of shipping costs (see Note 1), state income taxes, minority interests and other income (2001 only, see Note 11). There was no effect on any of the quarterly or annual periods’ net earnings or net earnings per share amounts. The effect of this restatement on the statement of earnings is as follows:

Year Ended December 31, 2002	First Quarter		Second Quarter		Third Quarter		Fourth Quarter
	Previously Reported	As Restated	Previously Reported	As Restated	Previously Reported	As Restated
Net sales	$1,028,164,467	$1,080,636,981	$1,141,677,480	$1,198,032,206	$1,165,641,454	$1,228,529,423	$1,294,577,927
Gross margin	71,148,114	100,899,364	105,458,586	128,386,346	122,217,407	121,930,407	118,283,090
Net earnings(1)	20,262,295	20,262,295	59,748,302	59,748,302	39,178,800	39,178,800	42,890,618
Net earnings per share:
Basic	.26	.26	.77	.77	.50	.50	.55
Diluted	.26	.26	.76	.76	.50	.50	.55

Year Ended December 31, 2001	First Quarter		Second Quarter		Third Quarter		Fourth Quarter
	Previously Reported	As Restated	Previously Reported	As Restated	Previously Reported	As Restated	Previously Reported	As Restated
Net sales	$1,028,017,720	$1,073,934,223	$1,078,574,872	$1,127,767,240	$1,053,088,039	$1,102,777,578	$979,567,947	$1,029,227,713
Gross margin	84,245,334	114,901,904	100,011,733	116,827,348	74,911,842	100,009,495	59,776,643	87,689,636
Net earnings (2)	32,738,976	32,738,976	33,292,863	33,292,863	20,463,277	20,463,277	26,465,891	26,465,891
Net earnings per share:
Basic	.42	.42	.43	.43	.26	.26	.34	.34
Diluted	.42	.42	.43	.43	.26	.26	.34	.34

(1)The second quarter of 2002 includes a gain of $29,900,000 related to a graphite electrodes anti-trust settlement.

(2)The fourth quarter of 2001 includes a pre-tax gain of $20,200,000 resulting from the sale of Nucor Iron Carbide Inc. in Trinidad.

38

REPORT OF INDEPENDENT ACCOUNTANTS

REPORTOF INDEPENDENT ACCOUNTANTS

PricewaterhouseCoopers LLP

February 6, 2003

Stockholders and Board of Directors
Nucor Corporation

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of earnings, stockholders’ equity and cash flows present fairly, in all material respects, the financial position of Nucor Corporation and its subsidiaries at December 31, 2002 and 2001, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2002 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of Nucor’s management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP

Charlotte, North Carolina

39

CORPORATE AND STOCK DATA

EXECUTIVE OFFICES

2100 Rexford Road
Charlotte, North Carolina 28211
Phone 704/366-7000
Fax 704/362-4208

STOCK TRANSFERS
DIVIDEND DISBURSING
DIVIDEND REINVESTMENT

American Stock Transfer & Trust Company
59 Maiden Lane
New York, New York 10038
Phone 800/937-5449
Fax 718/236-2641

ANNUAL MEETING

Place –
The Park Hotel
2200 Rexford Road
Morrison A & B
Charlotte, North Carolina

Time/Date –
10:00 a.m., Thursday
May 8, 2003

STOCK LISTING

New York Stock Exchange
Trading Symbol – NUE

STOCK PRICE AND DIVIDENDS PAID

	First Quarter		Second Quarter		Third Quarter		Fourth Quarter
2002
Stock Price:
High	$	66.35	$	70.15	$	65.31	$	51.36
Low	49.86		57.05		38.80		36.00
Dividends Paid	.17		.19		.19		.19
2001
Stock Price:
High	$	47.55	$	56.20	$	53.15	$	54.15
Low	37.50		38.48		33.45		35.80
Dividends Paid	.15		.17		.17		.17

FORM 10-K

A copy of Nucor’s 2002 annual report filed with the Securities and Exchange Commission (“SEC”) on Form 10-K is available to stockholders on request.

INTERNET ACCESS

Nucor’s annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to these reports are available through our website, www.nucor.com, as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. Various other financial and statistical data is also available.

THIS ANNUAL REPORT HAS BEEN PRINTED ON RECYCLED PAPER.

42

EX-21

Exhibit 21
Nucor Corporation
2002 Form 10-K

SUBSIDIARIES

Nucor-Yamato Steel Company, a Delaware limited partnership.
All other subsidiaries are not significant.

EX-23

Exhibit 23
Nucor Corporation
2002 Form 10-K

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in the Registration Statements on Form S-4 Number 333-101852 and Form S-8 (Numbers 2-84117 (including 2-50058), 2-51735, 33-27120 (including 2-55941 and 2-69914), 33-56649 and 333-85375) of Nucor Corporation of our report dated February 6, 2003 relating to the financial statements, which appears in the Annual Report to Shareholders, which is incorporated in this Annual Report on Form 10-K.

/s/ PricewaterhouseCoopers LLP
March 21, 2003

EX-24

Exhibit 24
Nucor Corporation
2002 Form 10-K

LIMITED POWER OF ATTORNEY
NUCOR CORPORATION FORM 10-K ANNUAL REPORTS

KNOW ALL MEN BY THESE PRESENTS:

That I, Peter C. Browning, the grantor, do by these presents hereby make, constitute and appoint Daniel R. DiMicco and Terry S. Lisenby, or either of them, true and lawful attorneys-in-fact for me and in my name, place and stead, to sign my name in the capacity stated and where required to the Form 10-K Annual Report of Nucor Corporation for calendar year 2002 filed with the Securities and Exchange Commission, and any and all amendments thereto.

Granting and giving unto my attorneys-in-fact authority and power to do and perform any and all other acts necessary or incident to the performance and execution of the powers herein expressly granted, with power to do and perform all acts authorized hereby, as fully as to all intents and purposes as I, the grantor, might or could do if personally present, with full power of substitution.

IN WITNESS WHEREOF, I have hereunto set my hand as of the 5th day of March, 2003.

/s/  PETER C. BROWNING

Peter C. Browning

STATE OF North Carolina	)
	) ss:
COUNTY OF Mecklenburg	)

I, Kelly J. Wilmoth, a Notary Public in and for the State and County aforesaid, do hereby certify that Peter C. Browning, the grantor of the foregoing Limited Power of Attorney, bearing date on the 5th day of March, 2003, personally appeared before me in this jurisdiction, being personally well known to me as the person who executed the said instrument, and acknowledged the same to be the act and deed of the grantor.

Given under my hand and seal this 5th day of March, 2003.

/s/  KELLY J. WILMOTH

Notary Public

My commission expires on August 23, 2003

LIMITED POWER OF ATTORNEY
NUCOR CORPORATION FORM 10-K ANNUAL REPORTS

KNOW ALL MEN BY THESE PRESENTS:

That I, Clayton C. Daley, Jr., the grantor, do by these presents hereby make, constitute and appoint Daniel R. DiMicco and Terry S. Lisenby, or either of them, true and lawful attorneys-in-fact for me and in my name, place and stead, to sign my name in the capacity stated and where required to the Form 10-K Annual Report of Nucor Corporation for calendar year 2002 filed with the Securities and Exchange Commission, and any and all amendments thereto.

Granting and giving unto my attorneys-in-fact authority and power to do and perform any and all other acts necessary or incident to the performance and execution of the powers herein expressly granted, with power to do and perform all acts authorized hereby, as fully as to all intents and purposes as I, the grantor, might or could do if personally present, with full power of substitution.

IN WITNESS WHEREOF, I have hereunto set my hand as of the 5th day of March, 2003.

/s/  CLAYTON C. DALEY, JR.

Clayton C. Daley, Jr.

STATE OF North Carolina	)
	) ss:
COUNTY OF Mecklenburg	)

I, Kelly J. Wilmoth, a Notary Public in and for the State and County aforesaid, do hereby certify that Clayton C. Daley, Jr., the grantor of the foregoing Limited Power of Attorney, bearing date on the 5th day of March, 2003, personally appeared before me in this jurisdiction, being personally well known to me as the person who executed the said instrument, and acknowledged the same to be the act and deed of the grantor.

Given under my hand and seal this 5th day of March, 2003.

/s/  KELLY J. WILMOTH

Notary Public

My commission expires on August 23, 2003

LIMITED POWER OF ATTORNEY
NUCOR CORPORATION FORM 10-K ANNUAL REPORTS

KNOW ALL MEN BY THESE PRESENTS:

That I, Harvey B. Gantt, the grantor, do by these presents hereby make, constitute and appoint Daniel R. DiMicco and Terry S. Lisenby, or either of them, true and lawful attorneys-in-fact for me and in my name, place and stead, to sign my name in the capacity stated and where required to the Form 10-K Annual Report of Nucor Corporation for calendar year 2002 filed with the Securities and Exchange Commission, and any and all amendments thereto.

Granting and giving unto my attorneys-in-fact authority and power to do and perform any and all other acts necessary or incident to the performance and execution of the powers herein expressly granted, with power to do and perform all acts authorized hereby, as fully as to all intents and purposes as I, the grantor, might or could do if personally present, with full power of substitution.

IN WITNESS WHEREOF, I have hereunto set my hand as of the 5th day of March, 2003.

/s/  HARVEY B. GANTT

Harvey B. Gantt

STATE OF North Carolina	)
	) ss:
COUNTY OF Mecklenburg	)

I, Kelly J. Wilmoth, a Notary Public in and for the State and County aforesaid, do hereby certify that Harvey B. Gantt, the grantor of the foregoing Limited Power of Attorney, bearing date on the 5th day of March, 2003, personally appeared before me in this jurisdiction, being personally well known to me as the person who executed the said instrument, and acknowledged the same to be the act and deed of the grantor.

Given under my hand and seal this 5th day of March, 2003.

/s/  KELLY J. WILMOTH

Notary Public

My commission expires on August 23, 2003

LIMITED POWER OF ATTORNEY
NUCOR CORPORATION FORM 10-K ANNUAL REPORTS

KNOW ALL MEN BY THESE PRESENTS:

That I, Victoria F. Haynes, the grantor, do by these presents hereby make, constitute and appoint Daniel R. DiMicco and Terry S. Lisenby, or either of them, true and lawful attorneys-in-fact for me and in my name, place and stead, to sign my name in the capacity stated and where required to the Form 10-K Annual Report of Nucor Corporation for calendar year 2002 filed with the Securities and Exchange Commission, and any and all amendments thereto.

Granting and giving unto my attorneys-in-fact authority and power to do and perform any and all other acts necessary or incident to the performance and execution of the powers herein expressly granted, with power to do and perform all acts authorized hereby, as fully as to all intents and purposes as I, the grantor, might or could do if personally present, with full power of substitution.

IN WITNESS WHEREOF, I have hereunto set my hand as of the 5th day of March, 2003.

/s/  VICTORIA F. HAYNES

Victoria F. Haynes

STATE OF North Carolina	)
	) ss:
COUNTY OF Mecklenburg	)

I, Kelly J. Wilmoth, a Notary Public in and for the State and County aforesaid, do hereby certify that Victoria F. Haynes, the grantor of the foregoing Limited Power of Attorney, bearing date on the 5th day of March, 2003, personally appeared before me in this jurisdiction, being personally well known to me as the person who executed the said instrument, and acknowledged the same to be the act and deed of the grantor.

Given under my hand and seal this 5th day of March, 2003.

/s/  KELLY J. WILMOTH

Notary Public

My commission expires on August 23, 2003

LIMITED POWER OF ATTORNEY
NUCOR CORPORATION FORM 10-K ANNUAL REPORTS

KNOW ALL MEN BY THESE PRESENTS:

That I, James D. Hlavacek, the grantor, do by these presents hereby make, constitute and appoint Daniel R. DiMicco and Terry S. Lisenby, or either of them, true and lawful attorneys-in-fact for me and in my name, place and stead, to sign my name in the capacity stated and where required to the Form 10-K Annual Report of Nucor Corporation for calendar year 2002 filed with the Securities and Exchange Commission, and any and all amendments thereto.

Granting and giving unto my attorneys-in-fact authority and power to do and perform any and all other acts necessary or incident to the performance and execution of the powers herein expressly granted, with power to do and perform all acts authorized hereby, as fully as to all intents and purposes as I, the grantor, might or could do if personally present, with full power of substitution.

IN WITNESS WHEREOF, I have hereunto set my hand as of the 5th day of March, 2003.

/s/  JAMES D. HLAVACEK

James D. Hlavacek

STATE OF North Carolina	)
	) ss:
COUNTY OF Mecklenburg	)

I, Kelly J. Wilmoth, a Notary Public in and for the State and County aforesaid, do hereby certify that James D. Hlavacek, the grantor of the foregoing Limited Power of Attorney, bearing date on the 5th day of March, 2003, personally appeared before me in this jurisdiction, being personally well known to me as the person who executed the said instrument, and acknowledged the same to be the act and deed of the grantor.

Given under my hand and seal this 5th day of March, 2003.

/s/  KELLY J. WILMOTH

Notary Public

My commission expires on August 23, 2003

LIMITED POWER OF ATTORNEY
NUCOR CORPORATION FORM 10-K ANNUAL REPORTS

KNOW ALL MEN BY THESE PRESENTS:

That I, Raymond J. Milchovich, the grantor, do by these presents hereby make, constitute and appoint Daniel R. DiMicco and Terry S. Lisenby, or either of them, true and lawful attorneys-in-fact for me and in my name, place and stead, to sign my name in the capacity stated and where required to the Form 10-K Annual Report of Nucor Corporation for calendar year 2002 filed with the Securities and Exchange Commission, and any and all amendments thereto.

Granting and giving unto my attorneys-in-fact authority and power to do and perform any and all other acts necessary or incident to the performance and execution of the powers herein expressly granted, with power to do and perform all acts authorized hereby, as fully as to all intents and purposes as I, the grantor, might or could do if personally present, with full power of substitution.

IN WITNESS WHEREOF, I have hereunto set my hand as of the 5th day of March, 2003.

/s/  RAYMOND J. MILCHOVICH

Raymond J. Milchovich

STATE OF North Carolina	)
	) ss:
COUNTY OF Mecklenburg	)

I, Kelly J. Wilmoth, a Notary Public in and for the State and County aforesaid, do hereby certify that Raymond J. Milchovich, the grantor of the foregoing Limited Power of Attorney, bearing date on the 5th day of March, 2003, personally appeared before me in this jurisdiction, being personally well known to me as the person who executed the said instrument, and acknowledged the same to be the act and deed of the grantor.

Given under my hand and seal this 5th day of March, 2003.

/s/  KELLY J. WILMOTH

Notary Public

My commission expires on August 23, 2003

LIMITED POWER OF ATTORNEY
NUCOR CORPORATION FORM 10-K ANNUAL REPORTS

KNOW ALL MEN BY THESE PRESENTS:

That I, Thomas A. Waltermire, the grantor, do by these presents hereby make, constitute and appoint Daniel R. DiMicco and Terry S. Lisenby, or either of them, true and lawful attorneys-in-fact for me and in my name, place and stead, to sign my name in the capacity stated and where required to the Form 10-K Annual Report of Nucor Corporation for calendar year 2002 filed with the Securities and Exchange Commission, and any and all amendments thereto.

Granting and giving unto my attorneys-in-fact authority and power to do and perform any and all other acts necessary or incident to the performance and execution of the powers herein expressly granted, with power to do and perform all acts authorized hereby, as fully as to all intents and purposes as I, the grantor, might or could do if personally present, with full power of substitution.

IN WITNESS WHEREOF, I have hereunto set my hand as of the 5th day of March, 2003.

/s/  THOMAS A. WALTERMIRE

Thomas A. Waltermire

STATE OF North Carolina	)
	) ss:
COUNTY OF Mecklenburg	)

I, Kelly J. Wilmoth, a Notary Public in and for the State and County aforesaid, do hereby certify that Thomas A. Waltermire, the grantor of the foregoing Limited Power of Attorney, bearing date on the 5th day of March, 2003, personally appeared before me in this jurisdiction, being personally well known to me as the person who executed the said instrument, and acknowledged the same to be the act and deed of the grantor.

Given under my hand and seal this 5th day of March, 2003.

/s/  KELLY J. WILMOTH

Notary Public

My commission expires on August 23, 2003

EX-99.II

Exhibit 99(ii)
Nucor Corporation
2002 Form 10-K

Certification of Principal Executive Officer
Pursuant to 18 U.S.C. 1350
(Section 906 of the Sarbanes-Oxley Act of 2002)

I, Daniel R. DiMicco, Vice Chairman, President and Chief Executive Officer (principal executive officer) of Nucor Corporation (the “Registrant”), certify, to the best of my knowledge, based upon a review of the Annual Report on Form 10-K for the year ended December 31, 2002 of the Registrant (the “Report”), that:

(1)The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

/s/ DANIEL R. DIMICCO
Name:	Daniel R. DiMicco
Date:	March 24, 2003

EX-99.III

Exhibit 99(iii)
Nucor Corporation
2002 Form 10-K

Certification of Principal Financial Officer
Pursuant to 18 U.S.C. 1350
(Section 906 of the Sarbanes-Oxley Act of 2002)

I, Terry S. Lisenby, Chief Financial Officer, Treasurer and Executive Vice President (principal financial officer) of Nucor Corporation (the “Registrant”), certify, to the best of my knowledge, based upon a review of the Annual Report on Form 10-K for the year ended December 31, 2002 of the Registrant (the “Report”), that:

(1)The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

/s/ TERRY S. LISENBY
Name:	Terry S. Lisenby
Date:	March 24, 2003