10-K

2003

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

x	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended December 31, 2003
	OR
¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the Transition period from             to
	Commission File No. 1-9117

RYERSON TULL, INC.

(Exact name of registrant as specified in its charter)

Delaware	36-3425828
(State of Incorporation)	(I.R.S. Employer Identification No.)
2621 West 15th Place, Chicago, Illinois	60608
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (773) 762-2121

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

Title of each class	Name of each exchange on which registered
Common Stock ($1.00 par value), including Preferred Stock Purchase Rights	New York Stock Exchange, Inc.

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

None

Indicate 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 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨ .

Indicate 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. x

The aggregate market value of the voting stock of the registrant held by nonaffiliates of the registrant was approximately $324,666,057.68 as of February 20, 2004.⁽¹⁾

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

The number of shares of Common Stock ($1.00 par value) of the registrant outstanding as of February 20, 2004 was 24,857,871.

(1) Excluding stock held by directors and executive officers of registrant, without admission of affiliate status of such individuals for any other purpose.

DOCUMENTS INCORPORATED BY REFERENCE

Part III of this Report on Form 10-K incorporates by reference certain information from the registrant’s definitive Proxy Statement which will be furnished to stockholders in connection with the Annual Meeting of Stockholders of the registrant scheduled to be held on April 21, 2004.

This Annual Report on Form 10-K contains statements which constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements appear in a number of places, including Item 1. “Business,” Item 3. “Legal Proceedings” and Item 7. “Management’s Discussion and Analysis of Operations and Financial Condition.” Such statements can be identified by the use of forward-looking terminology such as “believes,” “expects,” “may,” “estimates,” “will,” “should,” “plans” or “anticipates” or the negative thereof or other variations thereon or comparable terminology, or by discussions of strategy. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and may involve significant risks and uncertainties, and that actual results may vary materially from those in the forward-looking statements as a result of various factors. These factors include the effectiveness of management’s strategies and decisions; general economic and business conditions; developments in technology and e-commerce; new or modified statutory or regulatory requirements; sales volumes; pricing pressures; cost of purchased materials; ability to maintain market share; inventory management; market competition; the company’s mix of products and services; reliance on large customers; implementation, cost and financial risks associated with increasing use of multi-year contracts; the Company’s ability to lower costs and expenses; industry and customer consolidation; customer and supplier insolvencies; labor relations; the outcome of pending and future litigation and claims; continued availability of financing and financial resources required to support the Company’s future business and other factors. This report identifies other factors that could cause such differences. No assurance can be given that these are all of the factors that could cause actual results to vary materially from the forward-looking statements.

PART I

ITEM 1.    BUSINESS.

Ryerson Tull, Inc. (“Ryerson Tull”), a Delaware corporation, is the sole stockholder of Joseph T. Ryerson & Son, Inc. (“Ryerson”) and J. M. Tull Metals Company, Inc. (“Tull”) (unless the context indicates otherwise, Ryerson Tull, Ryerson and Tull, together with their subsidiaries, are collectively referred to herein as the “Company”). The Company has a single business segment, which is comprised primarily of Ryerson and Tull, leading steel service, distribution and materials processing organizations.

Operations

The Company conducts its materials distribution operations in the United States through its operating subsidiaries, Ryerson and Tull; in Canada through Ryerson Tull Canada, Inc., formerly known as Washington Specialty Metals, Inc.; in Mexico through Collado Ryerson, S.A. de C.V. a joint venture with G. Collado S.A. de C.V.; and in India through Tata Ryerson Limited, a joint venture with the Tata Iron & Steel Corporation, an integrated steel manufacturer in India; and is organized into four business units along regional and product lines. The Company is a leading metals service center in the United States based on sales revenue, with 2003 sales of $2.2 billion. The Company distributes and processes metals and other materials throughout the continental United States, and is among the largest purchasers of steel in the United States.

Industry Overview

Primary steel producers typically sell steel in the form of standard-sized coils, sheets, plates, structurals, bars and tubes, and generally sell in large volumes with long lead times for production and delivery. Other primary metals producers, such as producers of stainless steel and aluminum, also typically sell their products in large volumes with long lead times for production and delivery. However, many customers seek to purchase metals with customized specifications, including value-added processing, in smaller volumes, on shorter lead times and with more reliable delivery than primary metals producers are able to provide. Metals service centers act as intermediaries between primary metals producers and customers by purchasing metals in a variety of shapes and sizes from primary metals producers in large volumes, allowing metals service centers to take advantage of producer economies of scale resulting in lower costs of materials purchased, and engaging in a variety of distribution and value-added processing operations to meet the demands of specific customers. Because metals service centers purchase metals from a number of primary producers, they can maintain a consistent supply of various types of metal used by their customers. By purchasing products from metals service centers, customers may be able to lower their inventory levels, decrease the time between the placement of an order and receipt of materials and reduce internal expenses, thereby lowering their total cost of raw or semi-finished materials.

The metals service center industry is cyclical, impacted both by market demand and metals supply. Periods of strong and weak market demand principally are due to the cyclical nature of the industries in which the largest consumers of metals operate. Any significant slowdown in one or more of those industries could have a material adverse effect on the demand for metals, resulting in lower prices for metals and reduced profitability for metals service centers, including the Company. Metals prices and metals service center profitability generally improve as metal-consuming industries recover from economic downturns. However, excess supply of metals can, even in periods of strong demand, result in lower prices for metals and adversely impact profitability.

The industry is comprised of many companies, the majority of which have operations limited as to product line and size of inventory, with customers located in a specific geographic area. Based on data reported by the Metals Service Center Institute, the Company believes that the industry is comprised of over 5,000 service center locations operating throughout the United States. The industry is highly fragmented, consisting of a large number of small companies and a few relatively large companies. In general, competition is based on quality, service, price and geographic proximity.

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The industry is divided into three major groups: general line service centers, specialized service centers, and processing centers, each of which targets different market segments. General line service centers handle a broad line of metals products and tend to concentrate on distribution rather than processing. General line service centers range in size from one location to a nationwide network of locations. For general line service centers, individual order size in terms of dollars and tons tends to be small relative to processing centers, while the total number of orders is typically very high. Specialized service centers focus their activities on a narrower range of product and service offerings than general line companies. Such service centers provide a narrower range of services to their customers and emphasize product expertise and lower operating costs, while maintaining a moderate level of investment in processing equipment. Processing centers typically process large quantities of steel purchased from primary producers for resale to large industrial customers, such as the automotive industry. Because orders are typically large, operation of a processing center requires a significant investment in processing equipment.

The Company competes with many other general line service centers, specialized service centers and processing centers on a regional and local basis, some of which may have greater financial resources and flexibility than the Company. The Company also competes to a lesser extent with primary steel producers. Primary steel producers typically sell to very large customers that require regular shipments of large volumes of steel. Although these large customers sometimes use metals service centers to supply a portion of their metals needs, metals service center customers typically are consumers of smaller volumes of metals than customers of primary steel producers. Although the Company purchases from foreign steelmakers, some of the Company’s competitors purchase a higher percentage of metals than the Company from foreign steelmakers. Such competitors may benefit from favorable exchange rates or other economic or regulatory factors that may result in a competitive advantage. This competitive advantage may be offset somewhat by higher transportation costs and less dependable delivery times associated with importing metals into the United States. Excess capacity of metals relative to demand in the industry since mid-1995 led to a weakening in prices. Notwithstanding brief periods of price increases, the Company was generally reducing its prices from mid-1995 to remain competitive. Demand also was impacted by a cyclical downturn in the U.S. economy, impacting the Company’s business through decreasing volumes and declining prices starting in the second half of 2000 and continuing through the third quarter of 2003. Since the fourth quarter of 2003, the Company has experienced an increase in demand and prices for its products. Since the beginning of 2004, metals producers have imposed material surcharges and have indicated impending material shortages may occur.

Products and Services

The Company carries a full line of carbon steel, stainless steel, alloy steels and aluminum, and a limited line of nickel, red metals and plastics. These materials are inventoried in a number of shapes, including coils, sheets, rounds, hexagons, square and flat bars, plates, structurals and tubing.

The following table shows the Company’s percentage of sales revenue by major product lines for 2003, 2002 and 2001:

	Percentage of Sales Revenues
Product Line	2003		2002		2001
Carbon flat rolled	37	%	34	%	35	%
Stainless and aluminum	34		33		30
Fabrication and carbon plate	13		15		16
Bars, tubing and structurals	13		14		15
Other	3		4		4
Total	100	%	100	%	100	%

More than one-half of the materials sold by the Company are processed. The Company uses techniques such as sawing, slitting, blanking, pickling, cutting to length, leveling, flame cutting, laser cutting, edge trimming, edge rolling, fabricating and grinding to process materials to specified thickness, length, width, shape and surface

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quality pursuant to specific customer orders. Among the most common processing techniques used by the Company are pickling, a chemical process using an acidic solution to remove surface oxide, commonly called “scale,” from steel which develops after the steel is hot rolled; slitting, which is cutting coiled metals to specified widths along the length of the coil; and leveling, which is flattening metals and cutting them to exact lengths. Although the Company often uses third-party fabricators to outsource certain limited processes that the Company is not able to perform internally, outsourcing these processes does not affect a significant part of the Company’s operations or constitute a significant part of its operating costs.

The plate burning and fabrication processes are particularly important to the Company. These processes require sophisticated and expensive processing equipment. As a result, rather than making investments in such equipment, manufacturers have increasingly outsourced these processes to metals service centers.

As part of securing customer orders, the Company also provides technical services to its customers to assure the most cost effective material application while maintaining or improving the customers’ product quality.

The Company’s services include: just-in-time delivery, production of kits containing multiple products for ease of assembly by the customer, the provision of Company-owned materials to the customer and the placement of the Company employees at a customer’s site for inventory management, production and technical assistance. The Company also provides special stocking programs in which products that would not otherwise be stocked by the Company are held in inventory to meet certain customers’ needs. The foregoing services are designed to reduce customers’ costs by minimizing their investment in inventory and improving their production efficiency.

Customer Base

The Company’s customer base is diverse, numbering over 30,000. No customer accounted for more than 10 percent of Company sales in 2003, and the top ten customers accounted for approximately 21 percent of its sales in 2003. The Company’s customer base includes most metal-consuming industries, most of which are cyclical. The following table shows the Company’s percentage of sales revenue by class of customers for 2003, 2002 and 2001:

	Percentage of Sales Revenues
Class of Customer	2003		2002		2001
Machinery manufacturers	30	%	32	%	30	%
Fabricated metal products producers	24		26		25
Electrical machinery producers	21		16		14
Transportation equipment producers	9		9		10
Construction-related purchasers	5		4		4
Wholesale distributors	3		3		4
Metals mills and foundries	2		2		2
Other	6		8		11
Total	100	%	100	%	100	%

Some of the Company’s largest customers have supply arrangements with the Company at fixed prices and from three months to one year in duration. A small number of these arrangements extend beyond one year in duration; however, fixed prices do not exceed one year in duration. The Company attempts to limit its financial exposure on fixed-price sales arrangements by entering into fixed-price supply arrangements with one or more suppliers for comparable periods of time.

Suppliers

In 2003, the Company purchased approximately 2.7 million tons of materials from many suppliers, including mills located throughout the world. The Company’s top 25 suppliers accounted for 74 percent of 2003 purchase dollars. The only supplier that accounted for 10 percent or more of the 2003 purchase dollars was Ispat Inland Inc. (“Ispat”), which accounted for approximately 14 percent of purchase dollars.

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The Company purchases the majority of its inventories at prevailing market rates from key suppliers with which it has established relationships in order to obtain improvements in price, quality, delivery and service. In order to minimize its financial exposure, the Company generally matches its long-term fixed-price sales contracts for specific customers with long-term fixed-price supply contracts. However, because of the competitive nature of the business, when metal prices increase due to product demand, mill surcharges, supplier consolidation or other factors that in turn lead to supply constraints or longer mill lead times, the Company may not be able to pass its increased material costs fully to customers. These factors could also lead to disruptions in the Company’s ability to meet its material requirements. However, because the Company uses many suppliers, because there is a substantial overlap of product offerings from these suppliers, and because there are a number of other suppliers able to provide identical or similar products, the Company is generally able to meet its materials requirements. The Company believes it has good relationships with most of its suppliers.

Sales and Marketing

Each of the Company’s business units maintains its own sales and marketing force. In addition to its office sales staff, the Company markets and sells its products through the use of its field sales force that has extensive product and customer knowledge and through a comprehensive catalog of the Company’s products. The Company’s office and field sales staffs, which together consist of approximately 627 employees, include technical and metallurgical personnel. In addition, its corporate marketing department develops advertising materials and coordinates national product-specific promotions targeting industries serviced by the Company.

Capital Expenditures

In recent years the Company has made capital expenditures to maintain, improve and expand processing capabilities. Additions by the Company to property, plant and equipment, together with retirements for the five years ended December 31, 2003, excluding the initial purchase price of acquisitions, are set forth below. Net capital additions during such period aggregated $30.8 million.

	Dollars in Millions
	Additions		Retirements or Sales		Net Capital Additions
2003	$	19.4	$	22.8	$	(3.4	)
2002		10.5		12.9		(2.4	)
2001		13.4		11.5		1.9
2000		34.7		11.5		23.2
1999		31.6		20.1		11.5

The Company anticipates that capital expenditures, excluding acquisitions, will be in the range of $25 million to $40 million for 2004, which it expects will be funded from cash generated by operations.

Employees

As of December 31, 2003, the Company employed approximately 3,400 persons, of which approximately 1,600 were office employees and approximately 1,800 were plant employees. 55 percent of the plant employees were members of various unions, including the United Steelworkers and the Teamsters. The Company’s relationship with the various unions generally has been good and over the last five years there have been no work stoppages. During 2004, contracts covering approximately 65 employees at four facilities will expire. The agreement covering approximately 220 employees with the United Steelworkers was renewed on July 31, 2003. Agreements with the Teamsters will expire on various dates during the period April 30, 2004 through April 30, 2006. While management does not expect any unresolvable issues to arise in connection with the renewal of existing contracts, no assurances can be given that labor disruptions will not occur or that any of these contracts will be extended prior to their expiration.

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Environmental, Health and Safety Matters

The Company’s operations are subject to many federal, state and local regulations relating to the protection of the environment and to workplace health and safety. In particular, its operations are subject to extensive federal, state and local laws and regulations governing waste disposal, air and water emissions, the handling of hazardous substances, environmental protection, remediation, workplace exposure and other matters. The Company’s management believes that the Company’s operations are presently in substantial compliance with all such laws and does not currently anticipate that it will be required to expend any substantial amounts in the foreseeable future in order to meet current environmental, workplace health or safety requirements. However, additional costs and liabilities may be incurred to comply with future requirements, which costs and liabilities could have a material adverse effect on the Company’s results of operations, financial condition or cash flows.

Some of the properties owned or leased by the Company are located in industrial areas or have a history of heavy industrial use. The Company may incur environmental liabilities with respect to these properties in the future that could have a material adverse effect on the Company’s financial condition or results of operations. The Company retained an environmental consultant to conduct Phase I and Phase II environmental studies for one property that the Company intends to dispose of in connection with consolidating its Chicago operations. Based on the consultant’s reports on environmental contaminants at the site, the Company believes that the reserve established as part of the restructuring charge in the fourth quarter of 2001 is adequate to cover potential remediation costs for environmental issues identified in the consultant’s reports. The Company is not aware of any pending remedial actions or claims relating to environmental matters at properties presently used for Company operations that are expected to have a material adverse effect on the Company’s financial position, results of operations or cash flows.

On January 14, 2003, the United States Environmental Protection Agency (“USEPA”) advised Ryerson and various other unrelated parties that they are potentially responsible parties under the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”) in connection with the cleanup of a waste disposal facility formerly operated by Liquid Dynamics in Chicago, Illinois. The estimated total amount of the proposed corrective measures is approximately $800,000. The notice alleged that Ryerson may have generated or transported hazardous substances to that facility. Ryerson has entered into an Administrative Order with approximately 40 potentially responsible parties and the USEPA to perform cleanup at the site and reimburse certain response costs. Ryerson does not expect its potential liability to materially affect its or the Company’s results of operations, financial condition or cash flows.

Capital and operating expenses for pollution control projects were less than $500,000 per year for the past five years. Excluding any potential additional remediation costs resulting from the environmental studies for the property described above, the Company expects spending for pollution control projects to remain at historical levels.

Patents and Trademarks

The Company owns several U.S. and foreign trademarks, service marks and copyrights. Certain of the trademarks are registered with the U.S. Patent and Trademark Office and, in certain circumstances, with the trademark offices of various foreign countries. The Company considers certain other information owned by it to be trade secrets. It protects its trade secrets by, among other things, entering into confidentiality agreements with its employees regarding such matters and implementing measures to restrict access to sensitive data and computer software source code on a need-to-know basis. The Company believes that these safeguards adequately protect its proprietary rights and vigorously defends these rights. While the Company considers all of its intellectual property rights as a whole to be important, it does not consider any single right to be essential to its operations as a whole.

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Corporate Restructuring

In 2003, the Company recorded restructuring charges associated with the closure of facilities across the United States and consolidating sales and administrative services. The charges consist primarily of employee-related costs, including severance for 128 employees. The 2003 restructuring actions will be completed by mid-2004.

Ryerson Tull Receivables LLC

In 2001, the Company formed Ryerson Tull Receivables LLC in connection with the Company’s then-existing 364-day trade receivables securitization facility. Ryerson Tull Receivables LLC is a special-purpose, wholly-owned, bankruptcy-remote subsidiary organized for the sole purpose of buying receivables of certain subsidiaries of the Company and selling an undivided interest in all eligible receivables to certain commercial paper conduits.

Concurrent with the establishment of the Company’s up to $450 million revolving credit facility on December 20, 2002, the Company terminated its 364-day trade receivables securitization facility. At that date, Ryerson Tull Receivables LLC repurchased the interests of the commercial paper conduits in receivables, sold receivables held by it to Company subsidiaries, and ceased its purchase of receivables from the Company’s subsidiaries.

Foreign Operations

Ryerson Tull Canada

Ryerson Tull Canada, Inc., a wholly-owned, indirect Canadian subsidiary of the Company, is a metals service center and processor with facilities in Vaudreuil (QC) and Brampton (ON), Canada.

Ryerson Tull Mexico

Ryerson Tull Mexico, S.A. de C.V., a wholly-owned, indirect Mexican subsidiary of the Company, owns a general line metals processing and service center in Guadalajara, Mexico and leases such facility to Grupo Collado, S.A. de C.V. In the third quarter of 2003, the Company and G. Collado S.A. de C.V. formed Collado Ryerson, a joint venture that will enable the Company to expand service capability in Mexico. The Company, through Ryerson Tull Mexico, owns a 49 percent equity interest in the joint venture

Ryerson International

In 1994, the Company formed Ryerson International, Inc. (formerly Inland International, Inc.) to hold the Company’s non-North American international operations, and it organized Ryerson International Trading, Inc. (formerly Inland International Trading, Inc.) to sell products and services of the Company and its affiliates and purchase materials for them abroad.

Tata Ryerson Limited

The Company owns a 50 percent interest in Tata Ryerson Limited, a joint venture with the Tata Iron & Steel Corporation, an integrated steel manufacturer in India. Tata Ryerson Limited, which was formed in 1997, is a metals service center and processor with processing facilities at Jamshedpur, Pune, Bara, Howrah, Faridabad and Chennai, India. The impact of Tata Ryerson’s operations on the Company’s results of operations has not been material in any year held since inception.

Available Information

The Company makes its periodic and current reports available, free of charge, on its Website as soon as reasonably practicable after such material is electronically filed with, or furnished to, the Securities and Exchange Commission. The Company’s Website address is www.ryersontull.com.

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ITEM 2.    PROPERTIES.

As of January 1, 2004, the Company’s facilities were:

Joseph T. Ryerson & Son, Inc.

Ryerson owns its regional business unit headquarters offices in Chicago (IL) and Vernon (CA) and leases office space in Westmont (IL). Ryerson North’s service centers are at Bettendorf (IA), Buffalo (NY), Chattanooga (TN), Chicago (IL) (two facilities), Cincinnati (OH), Cleveland (OH), Dallas (TX), Des Moines (IA), Devens (MA), Fairless Hills (PA), Indianapolis (IN), Kansas City (MO), Lansing (MI), Milwaukee (WI), Philadelphia (PA), Pittsburgh (PA), Plymouth (MN), Pounding Mill (VA) and St. Louis (MO) with office space at Long Island City (NY). Ryerson West’s service centers are at Commerce City (CO), Phoenix (AZ), Portland (OR), Renton (WA), Spokane (WA), Stockton (CA) and Vernon (CA). Ryerson owns former operating facilities at Chicago (IL) and Portland, (OR). Ryerson Tull Coil Processing Division’s facilities are located in Chicago (IL), Knoxville (TN), Marshalltown (IA) and Plymouth (MN) with office space in Hamilton (OH).

All of Ryerson’s operating facilities are held in fee with the exception of the facilities at Bettendorf (IA) (long-term lease), one Chicago (IL) facility (short-term lease), Fairless Hills (PA) (long-term lease), Hamilton (OH) (long-term lease), Lansing (MI) (long-term lease), Knoxville (TN) (long-term lease), Plymouth (MN) (short-term lease), Portland (OR) (long-term lease) a portion of the property at St. Louis (MO) (short-term lease), Stockton (CA) (long-term lease) and offices at Long Island City (NY) (long-term lease). Ryerson has leases for the former operating facilities at Easton (PA) (short-term lease) and Wheeling (IL) (short-term lease) with a lease on former office spaces at New Hope (MN) (long-term lease). Ryerson’s properties are adequate to serve its present and anticipated needs.

J. M. Tull Metals Company, Inc.

Tull maintains service centers at Baton Rouge (LA), Birmingham (AL), Charlotte (NC), Charleston (SC), Duluth (GA), Fort Smith (AR) (2 facilities), Greensboro (NC), Greenville (SC), Greenwood (MS), Hickman (AR), Jackson (MS), Jacksonville (FL), Little Rock (AR), Miami (FL), New Orleans (LA), Oklahoma City (OK), Pikeville (NC), Pinellas Park (FL), Richmond (VA), Shreveport (LA), Tampa (FL), Tulsa (OK), West Memphis (AR), Youngsville (NC) and Norcross (GA), where its headquarters is located. All of Tull’s operating facilities are held in fee, with the exception of the facilities at Charleston (SC) (long-term lease), Charlotte (NC) (long-term lease), one at Fort Smith (AR) (long-term lease), Greenwood (MS) (long-term lease), Hickman (AR) (long-term lease), Pikeville (NC) (long-term lease), Pinellas Park (FL) (long-term lease), and Youngsville (NC) (short-term lease). Tull has a lease for the former operating facility at Lawrenceville (GA) (long-term lease). Tull’s properties are adequate to serve its present and anticipated needs.

Ryerson Tull Canada, Inc.

Ryerson Tull Canada, Inc., a wholly-owned, indirect Canadian subsidiary of Ryerson Tull, has three facilities in Canada. It leases the facilities at Vaudreuil (QC) (long-term lease) and Brampton (ON) (long-term lease) and a separate facility at Brampton (ON) is held in fee. The properties of Ryerson Tull Canada, Inc. are adequate to serve its present and anticipated needs.

Ryerson Tull Mexico

Ryerson Tull Mexico, S.A. de C.V., owns a general line metals processing and service center in Guadalajara, Mexico and leases such facility to Grupo Collado, S.A. de C.V.

Collado Ryerson S.A. de C.V., a joint venture in which the Company owns a 49 percent interest, owns one operating facility in Matamoros, Tamaulipas, Mexico. Collado Ryerson’s property is adequate to serve its present and anticipated needs.

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Tata Ryerson Limited

Tata Ryerson Limited, a joint venture company in which the Company owns a 50 percent interest, has six metals service centers in India, at Jamshedpur, Pune, Bara, Howrah, Faridabad and Chennai. Tata Ryerson’s properties are adequate to serve its present and anticipated needs.

ITEM 3.    LEGAL PROCEEDINGS.

From time to time, the Company is named as a defendant in legal actions incidental to our ordinary course of business. We do not believe that the resolution of these claims will have a material adverse effect on the Company’s financial condition, results of operations or cash flows. We maintain liability insurance coverage to assist in protecting our assets from losses arising from or related to activities associated with business operations.

On April 22, 2002, Champagne Metals, an Oklahoma metals service center that processes and sells aluminum products, sued us and six other metals service centers in the United States District Court for the Western District of Oklahoma. The other defendants are Ken Mac Metals, Inc.; Samuel, Son & Co., Limited; Samuel Specialty Metals, Inc.; Metal West, L.L.C.; Integris Metals, Inc. and Earle M. Jorgensen Company. Champagne Metals alleges a conspiracy among the defendants to induce or coerce aluminum suppliers to refuse to designate it as a distributor in violation of federal and state antitrust laws and tortious interference with business and contractual relations. The complaint seeks damages in excess of $75,000, with the exact amount to be proved at trial. Champagne Metals seeks treble damages on its antitrust claims and seeks punitive damages in addition to actual damages on its other claim. The Company believes that the suit is without merit and has answered the complaint denying all claims and allegations. The parties are currently conducting discovery, with the commencement of trial set for June 2004.

On January 14, 2003, the United States Environmental Protection Agency (“USEPA”) advised Ryerson and various other unrelated parties that they are potentially responsible parties under the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”) in connection with the cleanup of a waste disposal facility formerly operated by Liquid Dynamics in Chicago, Illinois. The estimated total amount of the proposed corrective measures is approximately $800,000. The notice alleged that Ryerson may have generated or transported hazardous substances to that facility. Ryerson has entered into an Administrative Order with approximately 40 potentially responsible parties and the USEPA to perform cleanup at the site and reimburse certain response costs. Ryerson does not expect its potential liability to materially affect its or the Company’s results of operations, financial condition or cash flows.

ITEM 4.    SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS.

Not applicable.

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EXECUTIVE OFFICERS OF REGISTRANT

Officers are elected by the Board of Directors of Ryerson Tull to serve for a period ending with the next succeeding annual meeting of the Board of Directors held immediately after the Annual Meeting of Stockholders. All executive officers of Ryerson Tull, with the exception of Joyce E. Mims, have been employed by the Company or an affiliate of the Company throughout the past five years.

Set forth below are the executive officers of Ryerson Tull as of February 25, 2004, and the age of each as of such date. Their principal occupations at present and during the past five years, including positions and offices held with the Company or a significant subsidiary or affiliate of the Company, are shown below. References to Pre-merger Ryerson Tull refer to a subsidiary wholly owned by the Company and merged into the Company in 1999. References to Inland refer to Inland Steel Industries, Inc., the former name of the Company.

Name, Age and Present Position with Registrant	Positions and Offices Held During the Past Five Years
Neil S. Novich, 49 Chairman, President and Chief Executive Officer	Mr. Novich has been Chairman, President and Chief Executive Officer and a director of Ryerson Tull since February 1999. He served as President, Chief Executive Officer, Chief Operating Officer and a director of Pre-merger Ryerson Tull from June 1994 to February 1999. He was a Senior Vice President of Inland from January 1995 to May 1996. Prior to joining Inland, he led the Distribution and Logistics Practice at Bain & Company, an international management consulting firm. Mr. Novich is also a director of W.W. Grainger, Inc.
Jay M. Gratz, 51 Executive Vice President, Chief Financial Officer and President—RTCP	Mr. Gratz has been Executive Vice President and Chief Financial Officer of Ryerson Tull since February 1999 and President of Ryerson Tull Coil Processing Division since November 2001. He was Vice President of Pre-merger Ryerson Tull from September 1994 to February 1999 and was Chief Financial Officer of Pre-merger Ryerson Tull from April 1996 to February 1999. He was Vice President and Chief Financial Officer of Inland from May 1996 to December 1998.
Gary J. Niederpruem, 52 Executive Vice President	Mr. Niederpruem has been Executive Vice President of Ryerson Tull since February 1999. He was President of Ryerson Central, a unit of Ryerson Tull, from April 1998 until February 1999. He was President of Ryerson East, a unit of Ryerson Tull, from January 1993 to March 1998.
James M. Delaney, 46 President—Customer Solutions Team, Chief Customer Officer and Chief Procurement Officer	Mr. Delaney has been President, Customer Solutions Team and Chief Customer Officer since June 2000 and Chief Procurement Officer since July 2001. He was President of Ryerson Central, a unit of Ryerson Tull, from February 1999 to June 2000. He was Vice President and General Manager of Ryerson Central from April 1997 until January 1999. He was Vice President and General Manager of Ryerson East, a unit of Ryerson Tull, from January 1993 until April 1997.
Robert M. Lampi, 47 President—Ryerson Tull West	Mr. Lampi has been President—Ryerson Tull West, a unit of Ryerson Tull, since June 2000. He was Vice President and General Manager of Ryerson West from November 1998 to May 2000. He was Marketing General Manager of Ryerson West from November 1997 to October 1998. He served as General Manager of Ryerson West’s Salt Lake City location from February 1993 to October 1997.
Stephen E. Makarewicz, 58 President—Ryerson Tull South	Mr. Makarewicz has been President, Ryerson Tull South, a unit of Ryerson Tull, since June 2000 and President, Chief Executive Officer and Chief Operating Officer of Tull since October 1994.

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Name, Age and Present Position with Registrant	Positions and Offices Held During the Past Five Years
William Korda, 56 Vice President— Human Resources	Mr. Korda has been Vice President—Human Resources of Ryerson Tull since February 1999. He served as Vice President—Human Resources of Pre-merger Ryerson Tull from October 1993 to February 1999.
Joyce E. Mims, 61 Vice President and General Counsel	Ms. Mims has been Vice President and General Counsel of Ryerson Tull since January 2001. She was Vice President, General Counsel and Secretary of Ryerson Tull from June 1999 until January 2001 and Senior Vice President and General Counsel of Ancilla Systems Incorporated, a multi-hospital health care system, from 1995 through 1997.
Darell R. Zerbe, 61 Vice President— Information Technology	Mr. Zerbe has been Vice President—Information Technology and Chief Information Officer of Ryerson Tull since February 1999. He served as Vice President—Information Technology and Chief Information Officer of Pre-merger Ryerson Tull from February 1996 to February 1999.
Terence R. Rogers, 44 Vice President— Finance and Treasurer	Mr. Rogers has been Vice President—Finance since September 2001 and Treasurer since February 1999. He was Chief Procurement Officer from April 2000 to July 2001. He served as Treasurer of Pre-merger Ryerson Tull from September 1998 to February 1999 and as Director—Pension & Risk Management of Inland from December 1994 to September 1998.
Lily L May, 54 Vice President, Controller and Chief Accounting Officer	Ms. May has been Vice President of Ryerson Tull since January 2003 and Controller since February 1999. She was Controller of Pre-merger Ryerson Tull from May 1996 to February 1999. She was Vice President—Finance and Purchasing and Controller of Inland Steel Company from January 1995 through May 1996.

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PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

The Common Stock of Ryerson Tull is listed and traded on the New York Stock Exchange. As of February 20, 2004, the number of holders of record of Common Stock of Ryerson Tull was 9,557.

The Company’s Common Stock trades on the New York Stock Exchange. The following table sets forth the high and low sale prices for and the frequency and amount of cash dividends declared on the Common Stock for the period January 1, 2002 through December 31, 2003.

RYERSON TULL, INC. AND SUBSIDIARY COMPANIES

SUMMARY BY QUARTER (UNAUDITED)

(Dollars in millions, except per share data)

	Net Sales		Gross Profit		Income (Loss) From Continuing Operations Before Taxes			Net Income (Loss)			Per Common Share												Dividend Paid
											Net Income (Loss)						Market Price
											Basic			Diluted			High		Low		Close
2003
First Quarter	$	548.1	$	109.5	$	1.0		$	0.6		$	0.02		$	0.02		$	7.04	$	5.50	$	6.25	$	0.05
Second Quarter		542.4		103.7		(6.8	)		(4.1	)		(0.17	)		(0.17	)		9.26		6.24		8.78		0.05
Third Quarter		551.4		103.0		(5.4	)		(3.2	)		(0.13	)		(0.13	)		9.94		7.45		7.80		0.05
Fourth Quarter		547.5		106.5		(4.9	)		(7.4	)(1)		(0.30	)(1)		(0.30	)(1)		11.58		7.81		11.45		0.05
Year	$	2,189.4	$	422.7	$	(16.1	)	$	(14.1	)	$	(0.58	)	$	(0.58	)	$	11.58	$	5.50	$	11.45	$	0.20
2002
First Quarter	$	516.9	$	101.5	$	(0.7	)	$	(83.2	)(2)	$	(3.36	)(2)	$	(3.36	)(2)	$	12.49	$	10.50	$	10.95	$	0.05
Second Quarter		548.4		108.5		(13.0	)		(10.0	)		(0.41	)		(0.41	)		11.76		9.30		11.63		0.05
Third Quarter		533.2		104.8		4.4			2.6			0.10			0.10			11.65		6.36		6.43		0.05
Fourth Quarter		498.0		95.8		(10.4	)		(5.7	)		(0.23	)		(0.23	)		7.32		5.60		6.10		0.05
Year	$	2,096.5	$	410.6	$	(19.7	)	$	(96.3	)	$	(3.89	)(3)	$	(3.89	)(3)	$	12.49	$	5.60	$	6.10	$	0.20

(1) In the fourth quarter of 2003, the Company recorded a valuation allowance for certain state tax assets of $4.3 million, or $0.17 per share.

(2) The first quarter of 2002 includes a charge for the cumulative effect of an accounting change of $91.1 million, $82.2 million after-tax, or $3.31 per share.

(3) Amounts for the quarters do not total to the amount reported for the year due to differences in the average numbers of shares outstanding.

Restrictions in the Company’s financing that limit the Company’s ability to pay dividends are described in Item 7 “Management’s Discussion and Analysis of Financial Condition” at page 13.

ITEM 6.    SELECTED FINANCIAL DATA.

The following historical consolidated financial information should be read in conjunction with the audited historical Consolidated Financial Statements of Ryerson Tull, Inc. and Subsidiaries and the Notes thereto included in Item 8. “Financial Statements and Supplementary Data.” The historical consolidated financial information for the fiscal years 1999 through 2003 reflects the historical financial statements of the Company.

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FIVE YEAR SUMMARY OF SELECTED FINANCIAL DATA AND

OPERATING RESULTS—CONTINUING OPERATIONS

(Dollars in millions, except per share and per ton data)

	2003			2002			2001			2000			1999
Summary of Earnings
Net sales	$	2,189.4		$	2,096.5		$	2,243.5		$	2,862.4		$	2,763.5
Gross profit		422.7			410.6			402.4			549.7			610.2
Operating profit (loss)		2.6	(1)		(8.8	)(2)		(74.6	)(4)		(4.1	)(5)		97.1	(6)
Income (loss) before income taxes, minority interest, and discontinued operations		(16.1	)(1)		(19.7	)(3)		(99.8	)(4)		(33.5	)(5)		73.9	(6)
Income (loss) from continuing operations		(14.1	)(1)		(12.4	)(3)		(60.2	)(4)		(25.1	)(5)		38.4	(6)
Earnings (loss) per share—basic		(0.58	)		(3.89	)		(2.44	)		(1.03	)		1.56
Earnings (loss) per share—diluted		(0.58	)		(3.89	)		(2.44	)		(1.03	)		1.56
Financial Position at Year-End
Inventory—current value(7)	$	498.8		$	492.7		$	409.2		$	608.9		$	606.1
Working capital		503.4			505.5			396.6			418.3			610.5
Property, plant and equipment		225.0			233.0			249.7			274.7			273.2
Total assets		1,114.4			1,101.5			1,009.9			1,372.1			1,387.2
Long-term debt		266.3			220.4			100.6			100.7			258.8
Stockholders’ equity		382.3			405.6			551.7			661.7			697.8
Financial Ratios
Inventory turnover—current value basis(7)		3.6			3.9			3.6			3.4			3.7
Return on ending stockholders’ equity		(3.7	)		(3.1	)		(10.9	)		(3.8	)		5.5
Volume and Per Ton Data
Tons shipped (000)		2,553			2,610			2,817			3,339			3,333
Average selling price per ton	$	858		$	803		$	796		$	857		$	829
Gross profit per ton		166			158			143			165			183
Operating expenses per ton		165			161			169			166			154
Operating profit per ton		1			(3	)		(26	)		(1	)		29
Profit Margins
Gross profit as a percent of sales		19.3	%		19.6	%		17.9	%		19.2	%		22.1	%
Operating expenses as a percent of sales		19.2			20.0			21.2			19.3			18.6
Operating profit as a percent of sales		0.1			(0.4	)		(3.3	)		(0.1	)		3.5
Other Data
Average number of employees		3,471			3,715			4,198			4,848			5,128
Tons shipped per average employee		736			703			671			689			650
Capital expenditures	$	19.4		$	10.5		$	13.4		$	34.7		$	31.6
Cash flow provided by (used for) operating activities		(12.6	)		(141.6	)		272.4			(74.4	)		7.8
Dividends per common share		0.20			0.20			0.20			0.20			0.20

(1) Includes restructuring and plant closure costs of $6.2 million pretax or $3.8 million after-tax.

(2) Includes adjustment to the sale of Inland Engineered Materials Corporation of $8.5 million pretax, or $5.4 million after-tax, restructuring and plant closure costs of $2.7 million pretax, or $1.6 million after-tax, a $10.9 million pretax, or $6.6 million after-tax, gain on the sale of assets and a $4.1 million pretax, or $2.6 million after-tax, gain on the sale of Company’s interests in China.

(3) In addition to the items noted in (2), includes a $5.1 million pretax, or $3.3 million after-tax, gain from shares received on demutualization of an insurance company.

(4) Includes restructuring costs of $19.4 million pretax, or $11.9 million after-tax, loss on the sale of Mexican interests of $3.3 million pretax, or $2.0 million after-tax, the write-off of the investment in MetalSite, Inc. of

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$1.0 million pretax, or $0.6 million after-tax, and a $1.3 million pretax, or $0.8 million after-tax, gain on the sale of assets.

(5) Includes restructuring and plant closure costs of $27.8 million pretax, or $17.7 million after-tax, bad debt expense for a single customer of $16.2 million pretax, or $12.3 million after-tax, and a $4.4 million pretax, or $2.8 million after-tax, pension curtailment gain.

(6) Includes a $1.8 million pretax, or $1.0 million after-tax, gain on the sale of assets and plant closure costs of $3.6 million pretax, or $2.2 million after-tax.

(7) Current value of inventory consists of book value of inventory plus LIFO reserve.

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Background

This section contains statements which constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. See disclosure presented on the inside of the front cover of this Annual Report on Form 10-K for cautionary information with respect to such forward-looking statements.

Critical Accounting Policies

Preparation of this Annual Report on Form 10-K requires the Company to make estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of the Company’s financial statements, and the reported amounts of revenue and expenses during the reporting period. The Company’s critical accounting policies, including the assumptions and judgments underlying them, are disclosed under the caption “Statement of Accounting and Financial Policies” under Item 8. These policies have been consistently applied and address such matters as revenue recognition, depreciation methods, inventory valuation, asset impairment recognition and pension and postretirement expense. While policies associated with estimates and judgments may be affected by different assumptions or conditions, the Company believes its estimates and judgments associated with the reported amounts are appropriate in the circumstances. Actual results may differ from those estimates.

The Company considers the policies discussed below as critical to an understanding of the Company’s financial statements, as application of these policies places the most significant demands on management’s judgment, with financial reporting results relying on estimation of matters that are uncertain. Senior management has discussed the development and selection of the critical accounting estimates and the related disclosure herein with the Audit Committee of the Board of Directors.

Provision for allowances, claims and doubtful accounts:    The Company performs ongoing credit evaluations of customers and sets credit limits based upon review of the customers’ current credit information and payment history. The Company monitors customer payments and maintains a provision for estimated credit losses based on historical experience and specific customer collection issues that the Company has identified. Estimation of such losses requires adjusting historical loss experience for current economic conditions and judgments about the probable effects of economic conditions on certain customers. The Company cannot guarantee that the rate of future credit losses will be similar to past experience. The Company considers all available information when assessing each quarter the adequacy of the provision for allowances, claims and doubtful accounts.

Inventory valuation:    The Company’s inventories are valued at cost, which is not in excess of market. Cost is determined by the last-in, first-out (“LIFO”) method. The Company regularly reviews inventory on hand and records provisions for obsolete and slow-moving inventory based on historical and current sales trends. Changes in product demand and the Company’s customer base may affect the value of inventory on hand which may require higher provisions for obsolete inventory.

Deferred tax asset:    The Company records operating loss and tax credit carryforwards and the estimated effect of temporary differences between the tax basis of assets and liabilities and the reported amounts in the Consolidated Balance Sheet. The Company follows detailed guidelines in each tax jurisdiction when reviewing

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tax assets recorded on the balance sheet and provides for valuation allowances as required. Deferred tax assets are reviewed for recoverability based on historical taxable income, the expected reversals of existing temporary differences, tax planning strategies and, most importantly, on projections of future taxable income. The projections of future taxable income require assumptions regarding volume, selling prices, margins, expense levels and industry cyclicality. If the Company is unable to generate sufficient future taxable income in certain tax jurisdictions, the Company will be required to record additional valuation allowances against the Company’s deferred tax assets. In 2003, the Company provided a valuation allowance of $4.5 million against certain deferred state tax assets to increase the valuation reserve to $5.1 million at December 31, 2003. To fully utilize all of its $12 million NOL carryforward available for state and local income tax purposes (net of valuation allowance), which expires between 2015 and 2023, the Company will be required to generate an average of approximately $48 million taxable income per year for the 20 year period 2004 through 2023. This average $48 million taxable income per year assumes an industry cyclicality where taxable income on a year by year basis ranges from $5 million to $95 million. A 10 percent shortfall in achieving the $48 million average taxable income required over the 20 year period, would result in an additional valuation allowance of $0.6 million against state deferred tax assets. (See Note 11 for further details).

Pension and postretirement benefit plan assumptions:    The Company sponsors various benefit plans covering a substantial portion of its employees for pension and postretirement medical costs. Statistical methods are used to anticipate future events when calculating expenses and liabilities related to the plans. The statistical methods include assumptions about, among other things, the discount rate, expected return on plan assets, rate of increase of health care costs and the rate of future compensation increases. The Company’s actuarial consultants also use subjective factors such as withdrawal and mortality rates when estimating expenses and liabilities. The assumptions used in the actuarial calculation of expenses and liabilities may differ materially from actual results due to changing market and economic conditions, higher or lower withdrawal rates or longer or shorter life spans of participants. These differences may result in a significant impact on the amount of pension or postretirement benefit expense the Company may record in the future. For example, regarding pension expense, a .25 percent decrease in the discount rate (from 6.75 percent to 6.5 percent) would have increased 2003 annual pension expense by $0.6 million. Also, a .25 percent decrease in the expected rate of return on plan assets (from 8.75 percent to 8.5 percent) would have increased 2003 annual pension expense by $0.8 million. For postretirement benefits, a one percent increase in the health care trend rate (from 10 percent in 2003 grading down to 5 percent in 2007 to 11 percent in 2003 grading down to 6 percent in 2007) would have increased 2003 postretirement benefit expense by $0.5 million.

Legal contingencies:    The Company is involved in a number of legal and regulatory matters including those discussed in Note 16 to the consolidated financial statements. As required by SFAS No. 5, “Accounting for Contingencies,” the Company determines whether an estimated loss from a loss contingency should be accrued by assessing whether a loss is deemed probable and can be reasonably estimated. The Company analyzes its legal matters based on available information to assess potential liability. The Company consults with outside counsel involved in our legal matters when analyzing potential outcomes. The amount of liability, if any, for legal claims and actions at December 31, 2003 is not determinable but, in the opinion of management, such liability, if any, will not have a material adverse effect on the Company’s financial position, results of operations or cash flows.

The following discussion should be read in conjunction with Item 6. “Selected Financial Data” and the Company’s Consolidated Financial Statements and related Notes thereto in Item 8. “Financial Statements and Supplementary Data.”

Overview

The Company is a general line materials, primarily metals, distributor and processor, offering a broad line of sheet, bar, tube and plate products. The Company purchases large quantities of metal products from primary producers and sells these materials in smaller quantities to a wide variety of metals-consuming industries. More

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than one-half of the metals products sold are processed by the Company by burning, sawing, slitting, blanking, cutting to length or other techniques. Revenue is recognized upon shipment to customers, which is substantially the same as recognizing revenue upon delivery given the proximity of the Company’s distribution sites to its customers. The Company’s profitability is dependent upon its ability to purchase material at competitive prices, to achieve adequate sales volume and to minimize operating expenses.

The metals service center industry is generally considered cyclical with periods of strong demand and higher prices followed by periods of weaker demand and lower prices due to the cyclical nature of the industries in which the largest consumers of metals operate. During 2003, the metals service center industry continued to be adversely affected by weak economic conditions in the manufacturing sector of the United States which started in the second half of 2000.

During 2003, the Company’s shipment volume declined 2 percent from 2002, following a 7 percent decline in volume in 2002 from 2001 and a 16 percent decline in 2001 from 2000. Negative market conditions impacted the Company’s profitability for years 2001, 2002 and 2003. During this period, the Company has focused on streamlining its operations to increase efficiency, as evidenced by the restructuring charges incurred in the period and the resulting reduction in warehousing and delivery, and selling, general and administrative expenses. These efforts have enabled the Company to have a lower operating cost structure and will position the Company to benefit to a greater extent from the economic recovery, when it occurs. In 2003, higher gross profit coupled with the benefit of the lower cost structure post restructuring, enabled the Company to report an operating profit for the first time since 1999.

Results of Operations

	Results of Operations
	2003			2002			2001
	(Figures in millions, except per share data)
Net sales from continuing operations	$	2,189.4		$	2,096.5		$	2,243.5
Gross profit		422.7			410.6			402.4
Warehousing and delivery expenses		226.4			226.6			245.8
Selling, general and administrative expenses		187.5			196.6			203.8
Restructuring charges		6.2			2.7			19.4
Net other charges and (gains)		—			(6.5	)		8.0
Operating profit (loss) from continuing operations		2.6			(8.8	)		(74.6	)
Loss from continuing operations		(14.1	)		(12.4	)		(60.2	)
Loss from discontinued operations		—			(1.7	)		—
Cumulative effect of change in accounting principle		—			(82.2	)		—
Net loss		(14.1	)		(96.3	)		(60.2	)
Loss per common share from continuing operations—diluted	$	(0.58	)	$	(0.51	)	$	(2.44	)
Net loss per common share—diluted		(0.58	)		(3.89	)		(2.44	)
Average shares outstanding—diluted		24.8			24.8			24.8

The Company reported a loss from continuing operations in 2003 of $14.1 million, or $0.58 per share, as compared with a loss from continuing operations of $12.4 million, or $0.51 per share, in 2002, and a loss of $60.2 million, or $2.44 per share, in 2001. Included in the 2003 results were restructuring and plant closure costs of $3.8 million after-tax, or $0.15 per share, and a valuation allowance against certain state deferred tax assets of $4.5 million, or $0.18 per share. Included in the 2002 results were a loss of $5.4 million after-tax, or $0.22 per share, to adjust the gain on sale of Inland Engineered Materials Corporation (“IEMC”), a gain on the sale of assets of $6.6 million after-tax, or $0.27 per share, a gain on the demutualization of an insurance company of $3.3 million after-tax, or $0.13 per share, a gain on the sale of the Company’s interests in China of $2.6 million after-tax or $0.11 per share and a restructuring charge of $1.6 million after-tax, or $0.07 per share. Included in the 2001 results were restructuring charges of $11.9 million after-tax, or $0.48 per share, and related inventory write-downs of $4.5 million after-tax, or $0.18 per share.

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Regarding discontinued operations, on July 16, 1998, Ispat International N.V. (“Ispat”) acquired Inland Steel Company (“ISC”), the Company’s wholly owned subsidiary that constituted the steel manufacturing and related operations segment of the Company’s consolidated operations. In 1998, the Company recorded a $510.8 million after-tax gain from this transaction. In the second quarter of 2002, the Company recorded a $1.7 million after-tax charge as an additional accrual for environmental indemnification claims made by Ispat in connection with the sale of ISC. In 2003, the Company and Ispat settled all environmental and other indemnification claims between them related to the Company’s indemnification obligations under the ISC/Ispat Merger Agreement and certain matters related to the Ispat Pension Plan. Details of the settlement are discussed in the “ISC/Ispat Transaction” below.

Included in the 2002 net loss of $96.3 million is an after-tax charge of $82.2 million, or $3.31 per share, from the Company’s adoption of Financial Accounting Standards Board Statement No. 142 (“SFAS 142”), “Goodwill and Other Intangible Assets.” Upon adoption of SFAS 142, the Company estimated the fair value of its reporting units using a present value method that discounted future cash flows. Because the fair value of each reporting unit was below its carrying value (including goodwill), application of SFAS 142 required the Company to complete the second step of the goodwill impairment test and compare the implied fair value of each reporting unit’s goodwill with the carrying value of that goodwill. As a result of this assessment, the Company wrote off the entire goodwill amount as of January 1, 2002 as a cumulative effect of change in accounting principle.

Comparison of 2003 with 2002—Continuing Operations

Net Sales.

Net sales of $2.19 billion in 2003 increased 4 percent from $2.10 billion in 2002 as a result of a 7 percent increase in average selling price, partially offset by a 2 percent decline in tons shipped. Volume was impacted by the weak market demand for the Company’s products. The Company experienced higher demand for its products in the fourth quarter of 2003 compared to the same period a year ago, as well as to the first three quarters of 2003 on a tons-per-day basis.

Gross Profit.

Gross profit—the difference between net sales and the cost of materials sold—increased 3 percent to $422.7 million in 2003 from $410.6 million in 2002. Gross profit as a percentage of sales decreased to 19.3 percent from 19.6 percent a year ago as the Company was unable to fully pass along certain material cost increases to customers due to competitive conditions in the marketplace. Gross profit per ton increased to $166 in 2003 from $158 in 2002 due to higher selling prices.

Expenses.

Total operating expenses increased $0.7 million to $420.1 million in 2003 from $419.4 million in 2002. Warehousing and delivery expenses decreased slightly in 2003 to $226.4 million from $226.6 million in 2002. The decrease was primarily due to lower rent expense and lower property insurance costs offset by increased workers compensation costs resulting from higher anticipated settlement costs, higher delivery expenses and higher equipment maintenance costs. Selling, general and administrative expenses declined to $187.5 million in 2003 from $196.6 million in 2002. The decrease was primarily due to a $5.8 million reduction in expenses associated with plant consolidations, lower salary expense due to declining employment levels and lower credit losses. These expense reductions were partially offset by higher taxes and pension expense.

Total operating expenses per ton increased to $165 from $161. Included in the total expenses for 2003 are restructuring and plant closure costs of $6.2 million. Total expenses in 2002 include an $8.5 million loss resulting from the settlement of litigation related to the sale of IEMC, $2.7 million of restructuring and plant closure costs, a $10.9 million gain on the sale of assets and a $4.1 million gain on the sale of the Company’s interests in China. The average number of employees decreased 7 percent from 3,715 in 2002 to 3,471 in 2003 while tons shipped per employee, a key measure of productivity, increased 5 percent from 703 tons to 736 tons.

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Operating Profit (Loss).

Operating profit was $2.6 million in 2003 compared to an operating loss of $8.8 million in 2002. The improvement was primarily due to the higher level of gross profit generated and lower selling, general and administrative expenses in 2003, as discussed above.

Other Expenses.

Other expenses increased to $18.7 million in 2003 from $10.9 million in 2002. Other expenses are primarily related to interest and financing costs. Included in 2002 other expenses was a gain of $5.1 million for the receipt of shares as a result of the demutualization of one of the Company’s insurance carriers, Prudential. Also included in 2002 other expenses is a charge of $1.9 million to write-off unamortized fees upon the termination of a financing agreement. Higher levels of short term financing during 2003 were primarily responsible for the increase in interest and financing costs.

Provision for Income Taxes.

In 2003, the Company recorded an income tax benefit of $2.0 million compared to $7.3 million in 2002. The effective tax rate was 12.5 percent in 2003 compared with 36.9 percent in 2002. The lower effective tax rate in 2003 resulted from recording an additional valuation allowance of $4.5 million against certain state deferred tax assets, compared to a valuation allowance of $0.6 million recorded in 2002.

Earnings Per Share.

Diluted earnings per share from continuing operations was a loss of $0.58 in 2003 and a loss of $0.51 in 2002.

Comparison of 2002 with 2001—Continuing Operations

Net Sales.

Net sales of $2.10 billion in 2002 declined 7 percent from $2.24 billion in 2001 as a result of a 7 percent decrease in tons shipped. Average selling price per ton increased 1 percent from 2001. Volume was impacted by weak market demand for the Company’s products.

Gross Profit.

Gross profit—the difference between net sales and the cost of materials sold—increased 2 percent to $410.6 million in 2002 from $402.4 million in 2001. Gross profit as a percentage of sales increased to 19.6 percent from 17.9 percent in the prior year. The prior year was negatively impacted by the Company’s decision to aggressively reduce inventory, which reduced gross profit by $32 million in 2001. The $32 million ($12 per ton) reduction consists of a $22 million impact due to the inclusion of older and higher-cost material in the cost of goods sold and a $10 million impact from inventory liquidation. Furthermore, 2001 gross profit was adversely impacted by $7.4 million ($2 per ton) in inventory write-downs associated with restructuring activities. Gross profit per ton increased to $158 in 2002 from $143 in 2001.

Expenses.

Total operating expenses decreased 12 percent in 2002 to $419.4 million from $477.0 million in 2001. Warehousing and delivery expenses decreased to $226.6 million from $245.8 million in 2001. The decline in warehousing and delivery expenses was primarily due to lower volume and lower labor costs resulting from workforce reductions. Selling, general and administrative expenses declined to $196.6 million in 2002 from $203.8 million in 2001. The decline in selling, general and administrative expenses was primarily due to lower salary expense resulting from declining employment levels.

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Total expenses for 2002 included an $8.5 million loss resulting from the settlement of litigation related to the sale of IEMC, $2.7 million of restructuring and plant closure costs, a $10.9 million gain on the sale of assets and a $4.1 million gain on the sale of the Company’s interests in China. Total expenses for 2001 included a restructuring charge of $19.4 million, goodwill amortization of $5.0 million, a loss on the sale of the Company’s interests in Mexico of $3.3 million, a $1.0 million write-off of an investment in MetalSite, Inc. and a $1.3 million gain on sale of assets. Total operating expenses per ton decreased to $161 from $169, a 5 percent decrease, due to the gain on the sale of assets and gain on sale of the Company’s interest in China in 2002 and higher restructuring and plant closure costs in 2001. The average number of employees decreased 12 percent from 4,198 in 2001 to 3,715 in 2002 while tons shipped per employee, a key measure of productivity, increased 5 percent from 671 tons to 703 tons.

Operating Profit (Loss).

Operating loss was $8.8 million in 2002 and $74.6 million in 2001. The improvement from 2001 was primarily due to the effect of higher gross profit and lower operating expenses in 2002, as discussed above.

Other Expenses.

Other expenses decreased to $10.9 million in 2002 from $25.2 million in 2001. Included in 2002’s other expenses was a gain of $5.1 million for the receipt of shares as a result of the demutualization of one of the Company’s insurance carriers, Prudential. Also included in other expenses is a charge of $1.9 million to write-off unamortized fees upon the termination of a financing agreement. The remaining other expenses are primarily related to interest and financing costs. Lower interest rates and lower levels of short term financing were responsible for the decrease in interest and financing costs.

Provision for Income Taxes.

In 2002, the Company recorded an income tax benefit of $7.3 million compared to $39.6 million in 2001. The effective tax rate was 36.9 percent in 2002 compared with 39.7 percent in 2001. In 2002, the effect of non-tax-deductible expense on the lower pretax loss was primarily responsible for the lower effective tax rate. The Company recorded a $0.6 million valuation allowance against certain state deferred tax assets in 2002.

Earnings Per Share.

Diluted earnings per share from continuing operations was a loss of $0.51 in 2002 and a loss of $2.44 in 2001.

Liquidity and Capital Resources

The Company had cash and cash equivalents at December 31, 2003 of $13.7 million, compared to $12.6 million at December 31, 2002. Net cash used for operating activities was $12.6 million in 2003, including a $55.8 million voluntary contribution to the Company’s pension fund, a $21 million settlement payment to Ispat (see “ISC/Ispat Transaction” below), a $29.3 million increase in accounts receivable due to increased sales in the fourth quarter of 2003 compared to the prior year, and a $42.0 million increase in accounts payable due to the timing of payments for certain trade payables. Net cash used for operating activities for 2002 was $141.6 million, which included $120 million repurchases of receivables upon the termination of the Company’s trade receivables securitization facility.

At December 31, 2003, the Company had $166 million outstanding funded borrowing under its revolving credit agreement, $47 million of letters of credit issued under the credit facility and $151 million available under the $450 million revolving credit agreement, compared to $163 million available on December 31, 2002. Total credit availability is limited by the amount of eligible account receivables and inventory pledged as collateral

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under the agreement, which aggregated $409 million at December 31, 2003, and further reduced by a $45 million availability block. $15 million of this availability block will become available if the Company meets certain financial ratios and the remaining $30 million will become available only upon the consent of lenders holding 85 percent of facility commitments. In addition, the availability blocks will increase each quarter beginning in March 2005 through the maturity of the Company’s 9 ¹/8% Notes in July 2006. (See discussion of Notes below). These blocked amounts can be used to repay the Notes and the increase in the availability block sets aside availability under the revolving credit to retire the Notes at maturity. The total increase in the availability block over the six quarters (first quarter of 2005 through June of 2006) will equal the outstanding principal value of the Notes, which is currently $100 million. Letters of credit issued under the facility also reduce the amount available for borrowing. Interest rates under the credit facility are at market levels and are variable.

Proceeds from credit facility borrowings and repayments of credit facility borrowings in the Consolidated Statement of Cash Flows represent borrowings under the Company’s revolving credit agreement with original maturities greater than three months. Net short-term proceeds/(repayments) under the credit facility represent borrowings under the Company’s revolving credit facility with original maturities less than three months. The combined effect of all of the above resulted in an increase in borrowings under the revolving credit facility of $46 million during 2003. As a result long-term debt in the Consolidated Balance Sheet increased from $220.4 million at December 31, 2002 to $266.3 million at December 31, 2003.

The following table presents contractual obligations at December 31, 2003:

	Payments Due by Period December 31, 2003 (Dollars in Millions)
Contractual Obligations*	Total		Less than 1 year		1-3 years		4-5 years		After 5 years
Long-Term Note	$	100		—	$	100		—		—
Revolving Credit Agreement	$	166		—	$	166		—		—
Interest on Long-Term Note and Revolving Credit Agreement	$	41	$	15	$	26		—		—
Purchase Obligations	$	27	$	27		—		—		—
Capital Lease Obligations		—		—		—		—		—
Operating Leases	$	71	$	13	$	22	$	14	$	22
Total	$	405	$	55	$	314	$	14	$	22

* The contractual obligations disclosed above do not include the Company’s potential future pension funding obligations (see discussion below).

The Company’s credit agreement permits stock repurchases, the payment of dividends and repurchase of the Company’s 9 ¹/8% Notes due in 2006. Stock repurchases, dividends and repurchase of the 2006 Notes are subject to annual and aggregate limits and restricted by specific liquidity tests. In the most restrictive case the Company is prohibited from repurchasing the 2006 Notes until the maturity date and is limited to a maximum payment of $7.5 million in dividends in any calendar year and $3 million in stock repurchases in any twelve-month period. As of December 31, 2003, the Company was not subject to the most restrictive limitations. Beginning on March 31, 2005, in addition to the $45 million availability blocks discussed above, separate availability blocks will increase each quarter through the maturity of the Company’s 9 ¹/8% Notes in July 2006 to set aside funds under this facility to repay the Notes.

The Company believes that cash flow from operations and proceeds from the revolving credit facility will provide sufficient funds to meet the Company’s contractual obligations and operating requirements. The current $450 million credit facility terminates at December 19, 2006. The Company believes that it will be able to obtain a replacement credit facility secured by the Company’s inventory and accounts receivables. Additionally, the Company believes that new public or private debt financing is a potential future source of funding. In the event the Company were to seek such debt financing, the ability to complete any future financing and the amount, terms and cost of any such future financing would be subject to debt market conditions at that time.

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The revolving credit agreement also contains covenants that, among other things, restrict the creation of certain kinds of secured indebtedness and of certain kinds of subsidiary debt, take or pay contracts, transactions with affiliates, mergers and consolidations, and sales of assets. There is also a covenant that no event, circumstance or development has occurred that would have a material adverse effect on the Company. The revolving credit agreement also includes cross-default provisions to other financing arrangements. The Company was in compliance with the revolving credit facility covenants at December 31, 2003.

As part of the ISC/Ispat transaction, the Inland Steel Industries Pension Plan (the “Ispat Pension Plan”) was transferred to Ispat. As a condition to completing the ISC/Ispat transaction, Ispat and the Company entered into an agreement with the Pension Benefit Guaranty Corporation (“PBGC”) to provide certain financial commitments to reduce the underfunding of the Ispat Pension Plan and to secure Ispat Pension Plan unfunded benefit liabilities on a termination basis. These commitments included a Company guaranty of $50 million of the obligations of Ispat to the PBGC in the event of a distress or involuntary termination of the Ispat Pension Plan. In August 2001, the Company established a $50 million letter of credit in favor of the PBGC as security for the guaranty. Under the agreement among the PBGC, Ispat and the Company, by July 16, 2003, Ispat was required to take all necessary action to provide adequate replacement security to the PBGC, which would permit the Company to terminate the guaranty and the related letter of credit. Ispat did not provide the replacement security by such date, and the Company, in accordance with the aforementioned agreement, renewed its letter of credit on July 16, 2003 (the “Letter of Credit”), on a year-to-year basis until December 20, 2006. On September 15, 2003, the Letter of Credit and guaranty were reduced to $29 million pursuant to certain agreements signed on that date and described below under the heading “ISC/Ispat Transaction.”

At December 31, 2003, $100 million of the Company’s 9 ¹/8% Notes due July 15, 2006 remain outstanding. The indenture under which the Notes were issued in 1996 contains covenants limiting, among other things, the creation of certain types of secured indebtedness, sale and leaseback transactions, the repurchase of capital stock, transactions with affiliates and mergers, consolidations and certain sales of assets. In addition, the Notes restrict the payment of dividends if the Company’s Consolidated Net Worth does not exceed a minimum level. The Company is in compliance with this net worth test. The Notes also include a cross-default provision in the event of a default in the revolving credit facility. The Company was in compliance with the indenture covenants at December 31, 2003.

The ratio of the Company’s long-term debt, including outstanding credit facility borrowings, to total capitalization was 41 percent at December 31, 2003, compared with 35 percent at year-end 2002.

The Company made a voluntary contribution of $55.8 million in the third quarter of 2003 to improve the pension trust’s funded status. At December 31, 2003, as reflected in Note 9 of the financial statements, pension liabilities exceeded trust assets by $102 million. The Company anticipates that it will not have any ERISA-required pension contribution funding in 2004 but could have future sizable pension contribution requirements. Future contribution requirements depend on the investment returns on plan assets and the impact on pension liabilities due to discount rates. The Company is unable to determine the amount or timing of any such contributions required by ERISA or whether any such contributions would have a material adverse effect on the Company’s financial condition, results of operations or cash flows. The Company believes that cash flow from operations and its credit facility described above will provide sufficient funds if the Company elects to make a contribution in 2004.

ISC/Ispat Transaction

In 1998, Ryerson Tull, Inc. (together with its subsidiaries, the “Company”) sold its steel manufacturing segment (“ISC”) to Ispat International N.V. and certain of its affiliates (“Ispat”) pursuant to an agreement of sale and merger (the “ISC/Ispat Merger Agreement”). Pursuant to that agreement, the Company agreed to indemnify Ispat up to $90 million for losses incurred in connection with breaches of representations and warranties contained in the agreement and for expenditures and losses incurred relating to certain environmental liabilities.

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Ispat was required to make all such indemnification claims prior to March 31, 2000, other than claims related to tax matters, certain organizational matters and environmental matters. On May 29, 2001, the Company entered into a settlement agreement with Ispat that settled certain of such claims, other than those related to environmental liabilities and certain property tax matters, for approximately $15 million, which applied against the $90 million indemnification cap. Ispat also notified the Company of certain environmental matters of which Ispat was aware, of certain environmental expenses that it had incurred or might incur, of certain property tax matters and other matters arising under ISC/Ispat Merger Agreement for which Ispat believed it was entitled to indemnification under that agreement.

In an agreement signed on September 15, 2003 (the “Settlement Agreement”), the Company and Ispat settled all environmental and other indemnification claims between them related to the Company’s indemnification obligations under the ISC/Ispat Merger Agreement and certain matters related to the Ispat Pension Plan. The Settlement Agreement has the following key components:

On September 15, 2003, the Company contributed $21 million to the Ispat Pension Plan and Ispat released the Company from any remaining environmental and other indemnification obligations arising out of the ISC/Ispat transaction. The Company had previously established an accrual to cover this $21 million payment. This $21 million payment reduced the Company’s PBGC Letter of Credit described below.

Ispat agreed to make specified monthly contributions to the Ispat Pension Plan totaling $29 million over the twelve-month period beginning January 2004, which will reduce and discharge the Company’s Letter of Credit to the PBGC on a dollar-for-dollar basis. As of February 27, 2004, Ispat is in compliance with all terms of the agreement and has made the required monthly pension contributions. As a result, the Letter of Credit has been reduced to $26.3 million and all Company incurred fees have been reimbursed by Ispat.

Ispat agreed to reimburse the Company for all fees or expenses (including interest expenses) payable to the provider or other person participating in the Letter of Credit (or any extension or replacement thereof) incurred by the Company in connection with (i) the Letter of Credit, (ii) any extension or replacement of the Letter of Credit, or (iii) any PBGC draw on the Letter of Credit or on any extension or replacement of the Letter of Credit.

If Ispat or any of its affiliates or subsidiaries receives any environmental insurance proceeds as a result of a claim related to the Company’s environmental indemnification obligations under the ISC/Ispat Merger Agreement, Ispat has agreed to pay the Company one-third of such proceeds (minus reimbursement of Ispat’s attorneys’ or other fees and expenses incurred in connection with pursuing such claims), up to a maximum amount of $21 million.

Under the ISC/Ispat Merger Agreement, Ispat and the Company agreed to the sharing of any property tax refunds resulting from the appeal of certain real estate property tax assessments. Under the Settlement Agreement, Ispat agreed to pay to the Ispat Pension Plan an amount equal to the cash received or the face amount of any credit or non-cash refund which Ispat is entitled to and receives related to property tax refunds or credits arising out of the appeals of certain real estate property tax assessments. Any such payments will pro-rata reduce Ispat’s monthly contributions to its pension plan as required by the Settlement Agreement, which contributions will reduce and discharge the Company’s Letter of Credit to the PBGC on a dollar-for-dollar basis.

On September 15, 2003, the Company entered into an agreement with Ispat and the PBGC under which the PBGC agreed that any contributions described above (the “Contributions”) made by Ispat or the Company to the Ispat Pension Plan would reduce and discharge the Letter of Credit and the Company’s guaranty on a dollar-for-dollar basis, until each of the Letter of Credit and the guaranty has been reduced to zero. The Company has a $5.5 million liability recorded related to this guaranty to the PBGC. Except for claims which could be made under Employee Retirement Income Security Act of 1974, as amended, for the period in which the Company was the sponsor of the Ispat Pension Plan, after these Contributions have been made, the Company will have no further liability with respect to the Ispat Pension Plan. As of February 27, 2004, Ispat has made the first two scheduled monthly Contributions and the Letter of Credit has been reduced to $26.3 million.

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Capital Expenditures

Capital expenditures during 2003 totaled $19.4 million, compared with $10.5 million in 2002. Capital expenditures were primarily for buildings, machinery and equipment and information technology upgrades.

The Company anticipates capital expenditures, excluding acquisitions, to be in the range of $25 million to $40 million in 2004, which will upgrade the Company’s information technology capability and maintain or improve the Company’s processing capacity.

Restructuring

2003

In the fourth quarter of 2003, the Company recorded a charge of $3.8 million as a result of consolidating plants in the Midwest and South regions of the United States. Included in the charge was severance for 58 employees. Also included was $0.9 million for additional rent at a facility that was closed in the 2000 restructuring. The restructuring actions associated with the $3.8 million charge will be completed by mid-2004. In the third quarter of 2003, the Company recorded a charge of $0.9 million as a result of consolidating plants in the East and Central Mountain regions and consolidating sales and administrative services in the Pacific Northwest. Included in the charge was severance for 53 employees. The restructuring actions associated with the $0.9 million charge have been completed. In the second quarter of 2003, the Company recorded a charge of $1.5 million as a result of workforce reductions. The charge consists of employee-related costs, including severance for 17 employees. The restructuring actions associated with the $1.5 million charge have been completed.

Excluding the $0.9 million adjustment to the 2000 restructuring, 2003 restructuring and plant closure costs totaled $5.3 million. The charge consists of employee-related and tenancy costs and will be used for future cash outlays. The Company expects to realize future annual cost and cash flow savings of approximately $9 million from these restructuring activities.

2002

In the second quarter of 2002, the Company recorded a charge of $2.0 million for costs associated with the closure of a facility in the southern United States. The charge consisted primarily of employee-related cash costs. Included in the charge was severance for 40 employees. The restructuring actions have been completed. In the third quarter of 2002, the Company recorded a charge of $0.7 million for a pension plan withdrawal liability discussed in “2001” below. The Company expected to realize future annual cost and cash flow savings of approximately $2 million from the 2002 restructuring activities.

2001

In the fourth quarter of 2001, the Company recorded a pretax restructuring charge of $19.4 million as a result of workforce reductions and plant consolidation. In the third quarter of 2002, the Company recorded a charge of $0.7 million as an adjustment to the $19.4 million recorded in 2001 resulting in a total restructuring charge of $20.1 million. The $20.1 million charge consists of $10.3 million of non-cash asset write-offs and $9.8 million of future cash outlays for employee-related costs and tenancy costs. The additional $0.7 million charge recorded in 2002 was due to a reduction in the market value of assets in a multi-employer pension plan from the initial estimate in 2001 to the final calculation of the withdrawal liability in 2002. The remaining multi-employer pension plan withdrawal liability of $1.1 million will be funded through 2005. As part of the restructuring, certain facilities in Michigan were closed and the Company consolidated two facilities into one location in Chicago. Included in the charge was severance for 178 employees. The 2001 restructuring actions were completed by year-end 2002.

In preparation for the Company’s planned disposition of one of the properties in Chicago, the Company retained an environmental consultant to conduct Phase I and Phase II environmental studies. Based on the consultant’s reports on environmental contaminants at the site, the Company believes that the $2 million reserve

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established in the fourth quarter of 2001 is adequate to cover potential remediation costs for environmental issues identified in the consultant’s reports.

2000

During 2000, the Company recorded a restructuring charge of $23.3 million, consisting of $10.7 million of asset write-offs and $12.6 million of future cash outlays for employee-related costs and tenancy costs. The charge was the result of realigning geographic divisions to improve responsiveness to local markets, exiting non-core businesses and centralizing administrative services to achieve economies of scale. Included in the charge was severance for 319 employees. The restructuring actions were completed by December 31, 2000. Based on court rulings in ongoing litigation in the fourth quarter of 2003, the Company recorded an additional $0.9 million reserve for future lease payments for a facility closed in the 2000 restructuring.

Deferred Tax Assets

At December 31, 2003, the Company had net deferred tax assets of $132 million comprised primarily of $60 million of Alternative Minimum Tax (“AMT”) credit carryforwards, a deferred tax asset related to post-retirement benefits other than pensions (“FASB Statement No. 106 obligation”) of $58 million and state net operating loss tax credit carryforwards of $12 million, net of valuation allowance. The Company believes that it is more likely than not that the Company will realize all of its deferred tax assets, except for certain of its state NOL carryforwards for which a valuation allowance of $5.1 million has been provided as discussed below.

The Company had available at December 31, 2003, federal AMT credit carryforwards of approximately $60 million, which may be used indefinitely to reduce regular federal income taxes. The Company had available at December 31, 2003, federal net operating loss (“NOL”) carryforwards of approximately $14 million which expire during the years 2022 and 2023. The Company also had other federal general business credit carryforwards for tax purposes of approximately $1 million, which expire during the years 2004 through 2009. The Company anticipates it will utilize its federal credits and NOL carryforwards from the period 2004 through 2012.

At December 31, 2003, the deferred tax asset related to the Company’s FASB Statement No. 106 obligation was $58 million. To the extent that future annual charges under FASB Statement No. 106 continue to exceed amounts deductible for tax purposes, this deferred tax asset will continue to grow. Thereafter, even if the Company should have a tax loss in any year in which the deductible amount would exceed the financial statement expense, the tax law provides for a 20-year carryforward period of that loss. Because of the long period that is available to realize these future tax benefits and the long-term nature of the related liabilities, this item is treated as having an indefinite reversal period and a valuation allowance for this deferred tax asset is not considered necessary.

Because of the short carryforward period available for losses in certain tax jurisdictions, the Company focused on state NOL’s in its review of the recoverability of tax assets. Deferred tax assets are reviewed for recoverability based on historical taxable income, the expected reversals of existing temporary differences, tax planning strategies and, most importantly, on projections of future taxable income. The projections of future taxable income require assumptions regarding volume, selling prices, margins, expense levels and industry cyclicality. As a result of its analysis, the Company recorded an additional valuation allowance of $4.5 million in the current year as part of its income tax provision. The cumulative valuation allowance of $5.1 million as of December 31, 2003 relates to the NOL’s for thirteen specific state and local jurisdictions where the Company does not expect to be able to utilize all of the tax benefits before their expiration.

To fully utilize all of its $12 million NOL carryforward available for state and local income tax purposes (net of valuation allowance), which expires between 2015 and 2023, the Company will be required to generate an average of approximately $48 million taxable income per year for the 20 year period 2004 through 2023. This average $48 million taxable income per year assumes an industry cyclicality where taxable income on a year by year basis ranges from $5 million to $95 million. Based on current financial projections as well as historical results, the Company considers the minimum average taxable income of $48 million per year for 2004-2023 to be achievable.

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Recent Accounting Pronouncements

In June 2001, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 143 (“SFAS 143”), “Accounting for Asset Retirement Obligations.” This statement requires that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. The associated asset retirement costs are capitalized as part of the carrying amount of the long-lived asset. SFAS 143 became effective for the Company on January 1, 2003. The adoption of this standard did not have a material impact on the Company’s financial statements.

In July 2002, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 146 (“SFAS 146”), “Accounting for Costs Associated with Exit or Disposal Activities” and it is effective for the Company beginning January 1, 2003. SFAS 146 addresses issues relating to the recognition, measurement, and reporting of costs associated with exit and disposal activities including restructuring activities.

In November 2002, the Financial Accounting Standards Board (“FASB”) issued FASB Interpretation No. 45 (“FIN 45”), “Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Guarantees of Indebtedness of Others.” The Company adopted the disclosure provisions of FIN 45 effective for the year ended December 31, 2002. The adoption of the disclosure provisions of FIN 45 resulted in no additional disclosures in the Company’s financial statements. The provisions for initial recognition and measurement of guarantees were effective for the Company beginning January 1, 2003. The adoption of the initial recognition provision for guarantees did not have a material impact on the Company’s financial statements.

In January 2003, the FASB issued FASB Interpretation No. 46 (“FIN 46”), “Consolidation of Variable Interest Entities.” FIN 46 clarifies the application of Accounting Research Bulletin No. 51, “Consolidated Financial Statements,” to certain entities in which equity investors do not have the characteristics of a controlling financial interest or in which equity investors do not bear the residual economic risks. The interpretation was immediately applicable to variable interest entities (“VIEs”) created after January 31, 2003, and to VIEs in which an enterprise obtains an interest after that date. As originally issued, it applied in the fiscal year or interim period beginning after June 15, 2003, to VIEs in which an enterprise holds a variable interest that was acquired before February 1, 2003. In October 2003, the FASB issued FASB Staff Position No. 46-6, which defers the effective date for FIN 46 to the first interim or annual period ending after March 15, 2004 for non-special-purpose entity VIEs created before February 1, 2003. The adoption of FIN 46 did not have a material effect on the Company’s financial statements.

In November 2002, the Emerging Issues Task Force (“EITF”) reached a consensus on Issue No. 00-21, “Revenue Arrangements with Multiple Deliverables.” EITF Issue No. 00-21 provides guidance on how to account for arrangements that involve the delivery or performance of multiple products, services and/or rights to use assets. The adoption of EITF Issue No. 00-21 in 2003 had no effect on the Company’s revenue recognition.

The Company adopted the revised FASB Statement of Financial Accounting Standards No. 132 (“SFAS 132”), “Employers’ Disclosure about Pensions and Other Postretirement Benefits, an amendment of FASB Statements No. 87, 88, and 106” in the fourth quarter of 2003. The revised SFAS 132 requires additional disclosure on changes in pension and other postretirement benefit obligations and fair values of plan assets.

In December 2003, the United States enacted into law the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (the “Act”). The Act establishes a prescription drug benefit under Medicare, known as “Medicare Part D,” and a federal subsidy to sponsors of retiree health care benefit plans that provide a benefit that is at least actuarially equivalent to Medicare Part D.

In January 2004, the FASB issued FASB Staff Position No. 106-1, “Accounting and Disclosure Requirements Related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003” (“FSP 106-1”). The Company has elected to defer accounting for the effects of the Act, as permitted by FSP 106-1. Therefore, in accordance with FSP 106-1, the Company’s accumulated postretirement benefit obligation and net postretirement health care costs included in the consolidated financial statements and accompanying notes do not

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reflect the effects of the Act on the plans. Specific authoritative guidance on the accounting for the federal subsidy is pending, and that guidance, when issued, could require the Company to change previously reported information.

Other Matters

IEMC

In the second quarter of 2002, the Company recorded a pretax charge of $8.5 million in connection with the settlement of litigation. The charge was recorded as a selling price adjustment to the 1998 sale of Inland Engineered Materials Corporation.

China

During the fourth quarter of 2002, the Company realized a gain of $4.1 million representing the proceeds on the sale of the Company’s 49 percent interest in Shanghai Ryerson Limited. The proceeds are accounted for as a cash inflow from investing activities.

Mexico

In the third quarter of 2003, the Company and G. Collado S.A. de C.V. formed Collado Ryerson, a joint venture that will enable the Company to expand service capability in Mexico. The Company invested $3.4 million in the joint venture for a 49 percent equity interest.

In March 2000, the Company and Altos Hornos de Mexico, S.A. de C.V. (“AHMSA”) entered into an agreement to sell the Company’s 50 percent interest in their joint venture to AHMSA for $15 million, with payment due in July 2000. Upon finalizing the terms of payment for the sale, the Company exchanged its ownership in the joint venture for inventory and the joint venture’s Guadalajara facility. In a separate transaction, on December 27, 2001, the Company sold its subsidiary, Ryerson Industries de Mexico S.A de C.V. to Grupo Collado, S.A. de C.V. As a result, the Company recorded a $3.3 million loss in 2001 on the sale of its Mexican interests.

IMF Steel International, Inc.

During the third quarter of 2001, the Company and The MacSteel Group dissolved their joint venture, IMF Steel International, Inc. As a result of the dissolution, the Company received $2.9 million, which is accounted for as a cash inflow from investing activities. The sale price equaled the net book value of the investment and the transaction had no impact on the net earnings for 2001.

MetalSite, Inc.

During the second quarter of 2001, the Company recorded a $1.0 million charge to write-off its investment in MetalSite, Inc. which was an Internet steel marketplace that halted commercial operations in that quarter.

Outlook

The Company’s business has been impacted by decreasing volumes and declining prices starting in the second half of 2000 and continuing through the third quarter of 2003, due to softening demand from customers in the manufacturing sector of the U.S. economy. Since the fourth quarter of 2003, the Company has experienced an increase in demand and prices for its products. The Company is unable to predict the duration of the current upturn in the economic cycle. Since the beginning of 2004, significant material surcharges have been imposed by the metal producers and there are indications of impending material shortages. It is possible that the Company may not be able to get all the material required by customers or pass the increased material costs fully to customers due to the competitive nature of the business. The Company is working closely with both customers and suppliers to minimize any negative impact.

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The Company’s pension plan currently meets the minimum funding requirements under the Employee Retirement Income Security Act (ERISA). Pension trust investment returns have been negatively impacted by the recent performance of the stock market. As reflected in Note 9 of the financial statements, pension liabilities exceeded trust assets by $102 million at year-end 2003. Although the Company does not expect to have any ERISA-required pension plan contributions during 2004, the Company may elect to make voluntary contributions to improve the plan’s funded status. In the event that asset returns do not improve or pension liabilities increase due to lower discount rates, the Company could have sizeable future pension contribution requirements beginning as soon as 2005. The Company is unable to determine the amount or timing of any such contributions required by ERISA or whether any such contributions would have a material adverse effect on the Company’s financial condition, results of operations or cash flow.

Deferred tax assets are reviewed periodically for recoverability based on historical taxable income, the expected reversals of existing temporary differences, tax planning strategies and, most importantly, on projections of future taxable income. The projections of future taxable income require assumptions regarding volume, selling prices, margins, expense levels, industry cyclicality, and ownership change, if any. Significant management judgment is required in making these projections. The Company monitors the projections for any significant changes from the long-term outlook. Depending on the result of such assessment, the Company may need to provide for additional valuation allowance against the deferred tax assets in the future.

ITEM 7A.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value. The Company has limited involvement with derivative financial instruments and does not use them for speculative or trading purposes. Cash equivalents are highly liquid, short-term investments with maturities of three months or less that are an integral part of the Company’s cash management portfolio. The carrying amount of cash equivalents approximates fair value because of the short maturity of those instruments. The estimated fair value of the Company’s long-term debt and the current portions thereof using quoted market prices of Company debt securities recently traded and market-based prices of similar securities for those securities not recently traded was $273 million at December 31, 2003 and $225 million at December 31, 2002, as compared with the carrying value of $266 million and $220 million at year-end 2003 and 2002, respectively.

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ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

Index to Consolidated Financial Statements

	Page
Financial Statements
Report of Independent Auditors	28
Consolidated Statements of Operations and Reinvested Earnings for the three years ended December 31, 2003	29
Consolidated Statement of Cash Flows for the three years ended December 31, 2003	30
Consolidated Balance Sheet at December 31, 2003 and 2002	31
Consolidated Statement of Comprehensive Income for the three years ended December 31, 2003	32
Schedules to Consolidated Financial Statements: Property, Plant and Equipment	32
Statement of Accounting and Financial Policies	33
Notes to Consolidated Financial Statements	35
Financial Statements Schedule
II—Valuation and Qualifying Accounts	54
All other schedules are omitted because they are not applicable. The required information is shown in the Financial Statements or Notes thereto.

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REPORT OF INDEPENDENT AUDITORS

To the Board of Directors and Stockholders of

    Ryerson Tull, Inc.:

In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all material respects, the financial position of Ryerson Tull, Inc. and its subsidiaries at December 31, 2003 and December 31, 2002, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2003 in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedule listed in the accompanying index presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These financial statements and financial statement schedule are the responsibility of the Company’s management; our responsibility is to express an opinion on these financial statements and financial statement schedule 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.

As discussed in Note 12 to the consolidated financial statements, on January 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets.”

/s/ PRICEWATERHOUSECOOPERS LLP

PricewaterhouseCoopers LLP

Chicago, Illinois

February 18, 2004

28

RYERSON TULL, INC. AND SUBSIDIARY COMPANIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND REINVESTED EARNINGS

(Dollars in millions, except per share data)

	Year ended December 31,
	2003			2002			2001
Net sales	$	2,189.4		$	2,096.5		$	2,243.5
Cost of materials sold		1,766.7			1,685.9			1,841.1
Gross profit		422.7			410.6			402.4
Warehousing and delivery		226.4			226.6			245.8
Selling, general and administrative		187.5			196.6			203.8
Goodwill amortization		—			—			5.0
Adjustment to the gain on sale of Inland Engineered Materials Corporation		—			8.5			—
Restructuring and plant closure costs		6.2			2.7			19.4
(Gain) loss on sale of foreign interests		—			(4.1	)		3.3
Write-off of investment in MetalSite, Inc.		—			—			1.0
Gain on sale of assets		—			(10.9	)		(1.3	)
Operating profit (loss)		2.6			(8.8	)		(74.6	)
Other expense:
Other income and expense, net		0.1			(1.4	)		(5.9	)
Shares received on demutualization of insurance company		—			5.1			—
Interest and other expense on debt		(18.8	)		(14.6	)		(19.3	)
Income (loss) before income taxes		(16.1	)		(19.7	)		(99.8	)
Provision (benefit) for income taxes (Note 11)		(2.0	)		(7.3	)		(39.6	)
Income (loss) from continuing operations		(14.1	)		(12.4	)		(60.2	)
Discontinued operations—Inland Steel Company
Gain (loss) on sale (net of tax benefit of $1.0 in 2002)		—			(1.7	)		—
Income (loss) before cumulative effect of change in accounting principle		(14.1	)		(14.1	)		(60.2	)
Cumulative effect of change in accounting principle (net of tax benefit of $8.9 in 2002)		—			(82.2	)		—
Net income (loss)		(14.1	)		(96.3	)		(60.2	)
Dividend requirements for preferred stock		0.2			0.2			0.2
Net income (loss) applicable to common stock	$	(14.3	)	$	(96.5	)	$	(60.4	)
Per share of common stock
Basic:
Income (loss) from continuing operations	$	(0.58	)	$	(0.51	)	$	(2.44	)
Inland Steel Company—gain (loss) on sale		—			(0.07	)		—
Cumulative effect of change in accounting principle		—			(3.31	)		—
Basic earnings (loss) per share	$	(0.58	)	$	(3.89	)	$	(2.44	)
Diluted:
Income (loss) from continuing operations	$	(0.58	)	$	(0.51	)	$	(2.44	)
Inland Steel Company—gain (loss) on sale		—			(0.07	)		—
Cumulative effect of change in accounting principle		—			(3.31	)		—
Diluted earnings (loss) per share	$	(0.58	)	$	(3.89	)	$	(2.44	)
Retained earnings at beginning of year	$	339.9		$	441.4		$	506.8
Net income (loss) for the year		(14.1	)		(96.3	)		(60.2	)
Dividends declared:
Common ($0.20 per share)		(4.9	)		(5.0	)		(5.0	)
Preferred ($2.40 per share)		(0.2	)		(0.2	)		(0.2	)
Retained earnings at end of year	$	320.7		$	339.9		$	441.4

See Notes to Consolidated Financial Statements on pages 33-53.

29

RYERSON TULL, INC. AND SUBSIDIARY COMPANIES

CONSOLIDATED STATEMENT OF CASH FLOWS

(Dollars in millions)

	Increase (decrease) in Cash Year ended December 31
	2003			2002			2001
Operating Activities
Net income (loss)	$	(14.1	)	$	(96.3	)	$	(60.2	)
Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities:
Depreciation and amortization		23.9			25.0			31.8
Deferred income taxes		5.9			12.6			(7.2	)
Deferred employee benefit funding/cost		(47.1	)		(3.5	)		(2.1	)
Restructuring and plant closure costs, net of cash payments		2.2			(0.7	)		16.1
(Gain) loss from sale of ISC, net of tax		—			1.7			—
(Gain) loss on the sale of foreign interests		—			(4.1	)		3.3
Write-off of investment in MetalSite, Inc.		—			—			1.0
Gain from sale of assets		—			(10.9	)		(1.3	)
Shares received on demutualization of insurance company (Note 14)		—			(5.1	)		—
Cumulative effect of change in accounting principle		—			82.2			—
Change in:
Receivables		(29.3	)		(108.9	)		168.8
Inventories		16.0			(54.1	)		176.7
Other assets and income tax receivable		(1.3	)		4.8			2.0
Accounts payable		42.0			4.3			(21.2	)
Other accrued liabilities		(13.2	)		11.7			(33.0	)
Other items		2.4			(0.3	)		(2.3	)
Net adjustments		1.5			(45.3	)		332.6
Net cash provided by (used for) operating activities		(12.6	)		(141.6	)		272.4
Investing Activities
Capital expenditures		(19.4	)		(10.5	)		(13.4	)
Unrestricted proceeds from the sale of short-term investment (Note 14)		—			5.7			—
Investment in joint venture		(3.4	)		—			—
Proceeds from sale of investment in joint venture		—			4.1			2.9
Proceeds from sales of assets		5.0			12.0			5.1
Net cash provided by (used for) investing activities		(17.8	)		11.3			(5.4	)
Financing Activities
Long-term debt issued		—			120.0			—
Long-term debt retired		—			—			(142.2	)
Proceeds from credit facility borrowings		355.0			—			—
Repayments of credit facility borrowings		(195.0	)		—			—
Net short-term proceeds/(repayments) under credit facility		(114.0	)		—			(97.0	)
Borrowing agreement issuance costs		—			(5.4	)		(3.0	)
Net increase/(decrease) in book overdrafts		(9.4	)		13.1			(22.9	)
Dividends paid		(5.1	)		(5.2	)		(5.2	)
Acquisition of treasury stock		—			(0.1	)		—
Net cash provided by (used for) financing activities		31.5			122.4			(270.3	)
Net increase (decrease) in cash and cash equivalents		1.1			(7.9	)		(3.3	)
Cash and cash equivalents—beginning of year		12.6			20.5			23.8
Cash and cash equivalents—end of year	$	13.7		$	12.6		$	20.5
Supplemental Disclosures
Cash paid (received) during the year for:
Interest	$	17.3		$	11.3		$	23.9
Income taxes, net		(12.1	)		(27.3	)		(23.5	)

See Notes to Consolidated Financial Statements on pages 33-53.

30

RYERSON TULL, INC. AND SUBSIDIARY COMPANIES

CONSOLIDATED BALANCE SHEET

(Dollars in millions)

	At December 31
	2003			2002
Assets
Current assets:
Cash and cash equivalents	$	13.7		$	12.6
Restricted cash (Note 14)		1.1			1.2
Receivables less provision for allowances, claims and doubtful accounts of $11.7 and $9.9, respectively		257.8			228.5
Inventories (Note 2)		437.6			453.6
Income taxes receivable		4.2			—
Total current assets		714.4			695.9
Investments and advances		11.4			7.1
Property, plant and equipment, at cost, less accumulated depreciation (see details on page 32)		225.0			233.0
Deferred income taxes (Note 11)		146.0			147.7
Intangible pension asset (Note 9)		10.2			7.4
Deferred charges and other assets		7.4			10.4
Total assets	$	1,114.4		$	1,101.5
Liabilities
Current liabilities:
Accounts payable	$	144.9		$	112.2
Accrued liabilities:
Salaries, wages and commissions		18.3			18.6
Taxes		11.0			7.9
Interest on debt		4.8			4.4
Terminated facilities costs (Note 10)		6.8			7.0
Other accrued liabilities		11.0			24.8
Deferred income taxes (Note 11)		14.2			15.5
Total current liabilities		211.0			190.4
Long-term debt (Note 4)		266.3			220.4
Deferred employee benefits (Note 9)		254.8			285.1
Total liabilities		732.1			695.9
Commitments and contingencies (Note 16)
Stockholders’ Equity
Preferred stock, $1.00 par value, 15,000,000 shares authorized for all series, aggregate liquidation value of $3.5 in 2003 and 2002 (Note 5)		0.1			0.1
Common stock, $1.00 par value; authorized—100,000,000 shares; issued—50,556,350 shares (Notes 5 through 7)		50.6			50.6
Capital in excess of par value (Note 5)		861.2			861.7
Retained earnings		320.7			339.9
Restricted stock awards		(0.1	)		(0.2	)
Treasury stock at cost—Common stock of 25,730,465 shares in 2003 and 25,741,662 shares in 2002 (Note 5)		(752.0	)		(752.5	)
Accumulated other comprehensive income (Note 5)		(98.2	)		(94.0	)
Total stockholders’ equity		382.3			405.6
Total liabilities and stockholders’ equity	$	1,114.4		$	1,101.5

See Notes to Consolidated Financial Statements on pages 33-53.

31

RYERSON TULL, INC. AND SUBSIDIARY COMPANIES

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(Dollars in millions)

	Year ended December 31
	2003			2002			2001
Net income (loss)	$	(14.1	)	$	(96.3	)	$	(60.2	)
Other comprehensive income (loss):
Foreign currency translation adjustments		4.3			(0.1	)		2.2
Minimum pension liability adjustment, net of tax benefit of $5.1 in 2003, $29.5 benefit in 2002 and $29.6 benefit in 2001		(8.5	)		(44.7	)		(47.1	)
Comprehensive income (loss)	$	(18.3	)	$	(141.1	)	$	(105.1	)

SCHEDULES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions)

	At December 31
	2003		2002
Property, Plant and Equipment
Land and land improvements	$	27.5	$	28.2
Buildings, machinery and equipment		562.5		563.8
Transportation equipment		2.4		2.4
Total		592.4		594.4
Less: Accumulated depreciation		367.4		361.4
Net property, plant and equipment	$	225.0	$	233.0

See Notes to Consolidated Financial Statements on pages 33-53.

32

STATEMENT OF ACCOUNTING AND FINANCIAL POLICIES

Principles of Consolidation.    The Company consolidates entities in which it owns or controls more than 50% of the voting shares. All significant intercompany balances and transactions have been eliminated in consolidation. In January 2003, the FASB issued Interpretation No. 46, “Consolidation of Variable Interest Entities, an Interpretation of Accounting Research Bulletin No. 51” (FIN 46). FIN 46 requires that factors in addition to the voting interest in an entity be considered in determining whether an entity should be consolidated. In preparing these financial statements, the Company was required to apply the provisions of FIN 46 to transactions entered into after January 31, 2003.

Use of Estimates.    The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and related notes to financial statements. Changes in such estimates may affect amounts reported in future periods.

Reclassification.    Certain items previously reported have been reclassified to conform with the 2003 presentation.

Revenue Recognition.    Revenue is recognized in accordance with SAB 101, “Revenue Recognition in Financial Statements.” Revenue is recognized upon shipment, which is substantially the same as recognizing revenue upon delivery to our customers given the proximity of our distribution sites to our customers.

Stock-Based Compensation.    Financial Accounting Standards Board Statement No. 123, “Accounting for Stock-Based Compensation,” (“SFAS 123”) encourages, but does not require companies to record compensation cost for stock-based employee compensation plans at fair value. The Company has chosen to continue to account for stock-based compensation using the intrinsic value method prescribed in Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees,” and related Interpretations. Accordingly, compensation cost for stock options is measured as the excess, if any, of the quoted market price of the Company’s stock at the date of the grant over the amount an employee must pay to acquire the stock. Compensation cost for stock appreciation rights and performance equity units is recorded annually based on the quoted market price of the Company’s stock at the end of the period. The Company’s stock-based employee compensation plans are described more fully in Note 6.

The following table illustrates the effect on net income and earnings per share if the Company had applied the fair value recognition provisions of SFAS 123 to stock-based employee compensation for the years ended December 31, 2003, 2002 and 2001, respectively (in millions, except per share data):

	2003			2002			2001
Net income, as reported	$	(14.1	)	$	(96.3	)	$	(60.2	)
Deduct: Total stock-based employee compensation expense determined under fair value method for all stock option awards, net of related tax effects		1.5			1.7			1.7
Pro forma net income	$	(15.6	)	$	(98.0	)	$	(61.9	)
Earnings per share—as reported	$	(0.58	)	$	(3.89	)	$	(2.44	)
Earnings per share—pro forma	$	(0.64	)	$	(3.96	)	$	(2.51	)

Shipping and Handling Fees and Costs.    Shipping and handling fees billed to customers are classified in “Net Sales” in our Consolidated Statement of Operations and Reinvested Earnings. Shipping and handling costs, primarily distribution costs, are classified in “Warehousing and delivery” expense in our Consolidated Statement of Operations and Reinvested Earnings. These costs totaled $59.3 million in 2003, $58.1 million in 2002 and $64.1 million in 2001.

Benefits for Retired Employees.    The estimated cost of the Company’s defined benefit pension plan and its post-retirement medical benefits are determined annually by consulting actuaries. The cost of these benefits for retirees is accrued during their term of employment (see Note 9). Pensions are funded in accordance with the requirements of the Employee Retirement Security Act of 1974 into a trust established under the Company

33

Pension Plan. Costs for retired employee medical benefits are funded when claims are submitted. Certain salaried employees are covered by a defined contribution plan, for which the cost is expensed in the period earned.

Per Share Results.    Basic per share results are based on the weighted average number of common shares outstanding and take into account the dividend requirements of preferred stock. Diluted per share results reflect the dilutive effect of outstanding stock options, the further dilutive effect of the assumed conversion into common stock of the outstanding shares of convertible preferred stock, and the elimination of the related preferred stock dividends.

Cash Equivalents.    Cash equivalents reflected in the financial statements are highly liquid, short-term investments with maturities of three months or less that are an integral part of the Company’s cash management portfolio. Checks issued in excess of funds on deposit at the bank represent “book” overdrafts and are reclassified to accounts payable. Amounts reclassified totaled $23.3 million and $32.7 million at December 31, 2003 and 2002, respectively.

Inventory Valuation.    Inventories are valued at cost, which is not in excess of market. Cost is determined by the last-in, first-out (“LIFO”) method.

Property, Plant and Equipment.    Property, plant and equipment are depreciated, for financial reporting purposes, using the straight-line method over the estimated useful lives of the assets. The provision for depreciation is based on the estimated useful lives of the assets (45 years for buildings and 14.5 years for machinery and equipment). Expenditures for normal repairs and maintenance are charged against income in the period incurred.

Long-lived Assets.    Long-lived assets and certain identifiable intangibles held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company estimates the future cash flows expected to result from the use of the asset and its eventual disposition. If the sum of the expected future cash flows (undiscounted and without interest charges) is less than the carrying amount of the asset, an impairment is recognized.

Income Taxes.    The Company records operating loss and tax credit carryforwards and the estimated effect of temporary differences between the tax basis of assets and liabilities and the reported amounts in the Consolidated Balance Sheet. The Company follows detailed guidelines in each tax jurisdiction when reviewing tax assets recorded on the balance sheet and provides for valuation allowances as required.

Guarantees.    In November 2002, the Financial Accounting Standards Board (“FASB”) issued FASB Interpretation No. 45 (“FIN 45”), “Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Guarantees of Indebtedness of Others.” FIN 45 requires the disclosure of certain guarantees existing at December 31, 2002. In addition, FIN 45 requires the recognition of a liability for the fair value of the obligation for qualifying guarantee activities that are initiated or modified after December 31, 2002. Accordingly, the Company has applied the recognition provisions of FIN 45 prospectively to guarantee activities initiated after December 31, 2002. See Note 16 for a further discussion of guarantees.

Foreign Currency Translation.    The Company translates assets and liabilities of its foreign subsidiaries, where the functional currency is the local currency, into U.S. dollars at the current rate of exchange on the last day of the reporting period. Revenues and expenses are translated at the average monthly exchange rates prevailing during the year.

34

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1:    Reorganization and Recapitalization

On February 25, 1999, the Company and its majority-owned subsidiary, Ryerson Tull, Inc. (“RT”), merged through the process of converting each share of RT Class A common stock into 0.61 share of Company common stock. After the merger, the Company changed its name from Inland Steel Industries, Inc. to Ryerson Tull, Inc. All references to RT in these financial statements refer to the pre-merger, majority-owned subsidiary of the Company.

The merger was accounted for as a purchase for financial reporting purposes. Under the purchase method of accounting, the assets and liabilities of RT in proportion to the 13 percent minority interest were recorded at their fair values at the effective time of the merger.

On July 16, 1998, Ispat International N.V. (“Ispat”) acquired Inland Steel Company (“ISC”), the Company’s wholly owned subsidiary that constituted the steel manufacturing and related operations segment of the Company’s consolidated operations, pursuant to an agreement and plan of merger dated May 27, 1998, as amended as of July 16, 1998 (the “ISC/Ispat Merger Agreement”), among the Company, ISC, Ispat and Inland Merger Sub, Inc. (an Ispat subsidiary). In the fourth quarter of 2000, the Company recorded a $7.5 million pretax charge related to Ispat’s claim for indemnification in connection with the resolution of a federal lawsuit. In the second quarter of 2002, the Company recorded an additional $2.7 million pretax charge related to Ispat’s claim for indemnification regarding environmental matters. In an agreement signed on September 15, 2003, the Company and Ispat settled all environmental and other indemnification claims between them related to the Company’s indemnification obligations under the ISC/Ispat Merger Agreement. See Note 16 regarding commitments and contingencies for a discussion of the settlement agreement.

Note 2:    Inventories

Inventories were classified on December 31 as follows:

	2003		2002
	(Dollars in Millions)
In process and finished products	$	437.4	$	453.3
Supplies		0.2		0.3
Total	$	437.6	$	453.6

Replacement costs for the LIFO inventories exceeded LIFO values by approximately $61 million and $39 million on December 31, 2003 and 2002, respectively.

Note 3:    Accounts Receivable Securitization

On December 20, 2002, the Company elected to terminate its trade receivables securitization facility and repurchase all interests in sold receivables at the face amount (See Note 4).

On March 29, 2001, the Company and certain of its subsidiaries completed arrangements for a $250 million 364-day trade receivables securitization facility with a group of financial institutions. The Company formed a special-purpose, wholly-owned, bankruptcy-remote subsidiary (“Ryerson Tull Receivables LLC”) for the sole purpose of buying receivables of certain subsidiaries of the Company and selling an undivided interest in substantially all trade accounts receivable to certain commercial paper conduits. On March 15, 2002, the facility was renewed for a 364-day period ending March 14, 2003, reduced from $250 million to $200 million, and modified certain termination events and covenants including, among other things, eliminating the provision

35

requiring termination of the facility if the Company failed to maintain specified debt ratings on its long-term unsecured debt. This securitization facility included substantially all of the Company’s accounts receivable. Fundings under the facility were limited to the lesser of a funding base, comprised of eligible receivables, or $200 million.

Sales of accounts receivable were reflected as a reduction of “receivables less provisions for allowances, claims and doubtful accounts” in the Consolidated Balance Sheet and the proceeds received were included in cash flows from operating activities in the Consolidated Statement of Cash Flows. The repurchase of the interests in sold receivables was included in cash flows from operating activities in the Consolidated Statement of Cash Flows. Proceeds from the sales of receivables were less than the face amount of accounts receivable sold by an amount equal to a discount on sale that approximated the conduits’ financing cost of issuing their own commercial paper, which was backed by their ownership interests in the accounts receivable sold by the special purpose subsidiary, plus an agreed-upon margin. These costs, totaling $2.1 million in 2002 and $8.5 million in 2001, were charged to “other income and expense, net” in the Consolidated Statement of Operations.

Generally, the facility provided that as payments were collected from the sold accounts receivable, the special-purpose subsidiary could elect to have the commercial paper conduits reinvest the proceeds in new accounts receivable. The commercial paper conduits, in addition to their rights to collect payments from that portion of the interests in the accounts receivable that was owned by them, also had rights to collect payments from that portion of the ownership interest in the accounts receivable that was owned by the special-purpose subsidiary. In calculating the fair market value of the Company’s retained interest in the receivables, the book value of the receivables represented the best estimate of the fair market value due to the current nature of these receivables. The facility required the Company to comply with various affirmative or negative covenants and required early amortization if the special-purpose subsidiary did not maintain a minimum equity requirement. The facility also would terminate on the occurrence and failure to cure certain events, including, among other things, any failure of the special-purpose subsidiary to maintain certain ratios related to the collectability of the receivables, or the Company’s failure to maintain long-term unsecured debt ratings of at least B by Standard and Poor’s and B2 by Moody’s.

The table below summarizes certain cash flows from and paid to securitization trusts ($ in millions):

	Year ended December 31
	2003		2002			2001
Repurchase of sold securitizations	$	—	$	(120	)	$	—
Proceeds from new securitizations		—		—			200
Proceeds from collections reinvested		—		769			1,084

Note 4:    Long-Term Debt

Credit Facility

On December 20, 2002, the Company and its two main operating subsidiaries elected to establish a new four-year up to $450 million revolving credit facility that extends to December 19, 2006. The new facility is secured by inventory and trade receivables and guaranteed by the Company’s domestic subsidiaries. Contemporaneously, both the Company’s $200 million trade receivables securitization and its $175 million credit facility secured by inventory were cancelled, all outstanding borrowings under those facilities repaid and all interests in sold receivables repurchased, and letters of credit issued under the credit facility transferred to the new revolving credit facility. The Company also recorded in 2002 a pretax charge of $1.9 million (included in “Interest and other expense on debt” in the Consolidated Statements of Operations and Reinvested Earnings) to write-off the remaining unamortized issuance costs associated with the cancelled credit facility.

36

At December 31, 2003, the Company had $166 million of borrowings, $47 million of letters of credit outstanding, and $151 million available under the $450 million revolving credit agreement. Total credit availability is limited by the amount of eligible account receivables and inventory pledged as collateral under the agreement, which aggregated $409 million at December 31, 2003, and further reduced by a $45 million availability block. $15 million of this availability block will become available if the Company meets certain financial ratios and the remaining $30 million will become available only upon the consent of lenders holding 85 percent of facility commitments. In addition, the availability blocks will increase each quarter beginning in March 2005 through the maturity of the Company’s 9 ¹/8% Notes in July 2006. (See discussion of Notes below). These blocked amounts can be used to repay the Notes and the increase in the availability block sets aside availability under the revolving credit to retire the Notes at maturity. The total increase in the availability block over the six quarters (first quarter of 2005 through June of 2006) will equal the outstanding principal value of the Notes, which is currently $100 million. Letters of credit issued under the facility reduce the amount available for borrowing. At year-end 2003, the weighted average interest rate on borrowings under the credit facility was 3.5 percent.

The revolving credit agreement also contains covenants that, among other things, restrict the payment of dividends, the amount of capital stock repurchases, the creation of certain kinds of secured indebtedness and of certain kinds of subsidiary debt, take or pay contracts, transactions with affiliates, mergers and consolidations, and sales of assets; and it contains cross-default provisions to other financing arrangements.

RT Notes

In July 1996, RT sold $150 million of 8 ¹/2% Notes, due July 15, 2001, and $100 million of 9 ¹/8% Notes, due July 15, 2006, in a public offering. The indenture under which the Notes were issued contains covenants limiting, among other things, the creation of secured indebtedness, sale and leaseback transactions, the repurchase of capital stock, transactions with affiliates, and mergers, consolidations and certain sales of assets. The Notes also include a cross-default provision in the event of a default in the revolving credit facility. On February 26, 1999, the indenture trustee agreed to a supplement to the indenture agreement allowing the Company to succeed its subsidiary, RT, as obligee for the Notes.

At December 31, 2003, $100 million of the Company’s 2006 Notes remain outstanding.

Regarding the 8 ¹/2% Notes, on July 16, 2001, the Company redeemed the $142.2 million outstanding balance that matured on that date.

Maturity of long-term debt due within five years is $266 million in 2006. See Note 16 regarding commitments and contingencies for other scheduled payments.

Note 5:    Capital Stock and Accumulated Other Comprehensive Income

On December 31, 2003, 5,954,864 shares of common stock remained reserved for issuance under the Company’s various stock plans and 80,003 shares are reserved for issuance upon conversion of shares of preferred stock.

The Series A $2.40 Cumulative Convertible Preferred Stock, $1.00 par value per share (“Series A Preferred Stock”), is convertible into common stock at the rate of one share of common stock for each share of Series A Preferred Stock and is redeemable, at the Company’s option, at $44 per share plus any accrued and unpaid dividends. Each such share is entitled to one vote and generally votes together with holders of common stocks as one class.

37

The following table details changes in capital accounts:

	Common Stock			Treasury Stock					Preferred Stock Series A				Capital in Excess of Par Value			Accumulated Other Comprehensive Income
																Foreign Currency Translation			Minimum Pension Liability
	Shares	Dollars		Shares		Dollars			Shares		Dollars		Dollars
	(Shares in Thousands and Dollars in Millions)
Balance at January 1, 2001	50,556	$	50.6	(25,782	)	$	(754.1	)	81		$	0.1	$	862.8		$	(4.3	)	$	—
Issued under employee stock plans	—		—	5			0.2		—			—		(0.1	)		—			—
Conversion of Series A Preferred Stock	—		—	1			—		(1	)		—		—			—			—
Foreign currency translation	—		—	—			—		—			—		—			2.2			—
Minimum pension liability (net of tax of $29.6 cr.)	—		—	—			—		—			—		—			—			(47.1	)
Other changes	—		—	8			0.3		—			—		(0.2	)		—			—
Balance at December 31, 2001	50,556		50.6	(25,768	)		(753.6	)	80			0.1		862.5			(2.1	)		(47.1	)
Acquisition of treasury stock	—		—	(10	)		(0.1	)	—			—		—			—			—
Issued under employee stock plans	—		—	27			0.9		—			—		(0.6	)		—			—
Foreign currency translation	—		—	—			—		—			—		—			(0.1	)		—
Minimum pension liability (net of tax of $29.5 cr.)	—		—	—			—		—			—		—			—			(44.7	)
Other changes	—		—	9			0.3		—			—		(0.2	)		—			—
Balance at December 31, 2002	50,556		50.6	(25,742	)		(752.5	)	80			0.1		861.7			(2.2	)		(91.8	)
Acquisition of treasury stock	—		—	(2	)		—		—			—		—			—			—
Issued under employee stock plans	—		—	14			0.5		—			—		(0.5	)		—			—
Foreign currency translation	—		—	—			—		—			—		—			4.3			—
Minimum pension liability (net of tax of $5.1 cr.)	—		—	—			—		—			—		—			—			(8.5	)
Balance at December 31, 2003	50,556	$	50.6	(25,730	)	$	(752.0	)	80		$	0.1	$	861.2		$	2.1		$	(100.3	)

Note 6:    Stock Option Plans

The Company has adopted the disclosure-only provisions of FASB Statement No. 123, “Accounting for Stock-Based Compensation.” Accordingly, no compensation cost has been recognized for the stock option plans. Had compensation cost for the option plans been determined based on the fair value at the grant date for awards in 2003, 2002 and 2001 consistent with the provisions of FASB Statement No. 123, the Company’s net income and earnings per share would have been reduced to the pro forma amounts indicated below:

	2003			2002			2001
	(Dollars in Millions (except per share data))
Net income (loss)—as reported	$	(14.1	)	$	(96.3	)	$	(60.2	)
Net income (loss)—pro forma	$	(15.6	)	$	(98.0	)	$	(61.9	)
Earnings per share—as reported	$	(0.58	)	$	(3.89	)	$	(2.44	)
Earnings per share—pro forma	$	(0.64	)	$	(3.96	)	$	(2.51	)

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions used for grants in 2003: dividend yield of 1.00 percent; expected volatility of 50.31 percent; risk-free interest rate of 2.92 percent; and expected term of five years.

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Company Plan

The 2002 Incentive Stock Plan, approved by stockholders on May 8, 2002, provides for the issuance, pursuant to options and other awards, of 2.5 million shares of common stock plus shares available for issuance under the 1999 and 1995 Incentive Stock Plans, to officers and other key employees. As of December 31, 2003, a total of 2,041,695 shares were available for future grants. Options remain outstanding and exercisable under the 1999, 1995 and 1992 Incentive Stock Plans; however, no further options may be granted under these plans. Under the various plans, the per share option exercise price may not be less than 100 percent of the fair market value per share on the date of grant. Generally, options become exercisable over a three-year period with one-third becoming fully exercisable at each annual anniversary of grant. Options expire ten years from the date of grant. During 2003, options were granted to 13 executive officers under the 2002 Plan. The following summarizes the status of options under the plans for the periods indicated:

	Number of Shares		Option Exercise Price or Range Per Share		Weighted Average Exercise Price
Options (granted and unexercised) at December 31, 2000 (1,402,360 exercisable)	2,206,783		$	12.13-48.44	$	24.48
Granted	1,045,000			8.88		8.88
Exercised	—			—		—
Forfeited	(187,482	)		8.88-41.55		19.44
Expired	(161,817	)		17.13-41.55		26.71
Options (granted and unexercised) at December 31, 2001 (1,505,018 exercisable)	2,902,484			8.88-48.44		19.06
Granted	37,000			12.08		12.08
Exercised	(9,240	)		8.88		8.88
Forfeited	(75,154	)		8.88-30.88		26.22
Expired	(27,087	)		25.50-34.31		34.15
Options (granted and unexercised) at December 31, 2002 (2,008,396 exercisable)	2,828,003			8.88-48.44		18.67
Granted	1,127,000			6.63		6.63
Exercised	—			—		—
Forfeited	(181,836	)		6.63-41.55		23.97
Expired	(38,550	)		26.13-35.16		34.61
Options (granted and unexercised) at December 31, 2003 (2,326,937 exercisable)	3,734,617		$	6.63-48.44	$	14.61

The weighted-average fair value of options granted during 2003 was $2.86.

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The following table summarizes information about fixed-price stock options outstanding at December 31, 2003:

		Options Outstanding		Options Exercisable
Range of Exercise Prices	Number of Shares	Weighted- Average Remaining Contractual Life	Weighted- Average Exercise Price	Number of Shares	Weighted- Average Exercise Price
30.88	15,200	1/2 year	30.88	15,200	30.88
41.55 to 48.44	72,497	1/2 year	42.96	72,497	42.96
28.50 to 38.35	74,129	1 year	37.62	74,129	37.62
24.69 to 33.22	224,586	2 years	32.90	224,586	32.90
23.05	145,245	3 years	23.05	145,245	23.05
21.93 to 24.18	223,260	4 years	21.95	223,260	21.95
32.07	17,080	4 years	32.07	17,080	32.07
16.03 to 24.81	465,500	5 years	16.81	465,500	16.81
19.56	403,200	6 years	19.56	403,200	19.56
12.13	5,500	6 years	12.13	5,500	12.13
8.88	975,760	7 years	8.88	668,530	8.88
12.08	35,660	8 years	12.08	12,210	N/A
6.63	1,077,000	9 years	6.63	—	N/A

Stock appreciation rights (“SARs”) may also be granted with respect to shares subject to outstanding options. No SAR has been granted since 1990 under the Company Plan. However, in 1998, 90,000 SARs were granted under the Pre-merger Ryerson Tull 1996 Incentive Stock Plan and were substituted by 54,900 Company SARs after the merger of the Company and RT. SAR compensation expense recorded by the Company was not material for any of the last three years.

The 2002 Plan also provides, as did the 1999, 1995 and 1992 Plans, for the granting of restricted stock and performance awards to officers and other key employees. During 2003, no performance awards were granted and none were forfeited. Also during 2003, no shares of restricted stock were issued, 12,495 shares of previously granted restricted stock vested, while 2,000 shares were forfeited. During 2002, no performance awards were granted while 114 shares subject to performance awards were forfeited. Also during 2002, 19,000 shares of restricted stock were issued, 5,495 shares of previously granted restricted stock vested, while 610 shares were forfeited. During 2001, no performance awards were granted, while 3,337 shares subject to performance awards were forfeited. Also during 2001, 2,995 shares of restricted stock were issued, no shares of previously granted restricted stock vested, while 3,500 shares were forfeited.

At December 31, 2003, there were 17,000 shares of restricted stock issued, but not vested, and 426 shares from performance awards earned, but not issued and not vested.

Director Plan

The Ryerson Tull Directors’ 1999 Stock Option Plan, combined in 2003 with the Directors’ Compensation Plan (the “Directors’ Compensation Plan”), provided that each person who is a non-employee director as of the close of each annual meeting would be awarded a stock option for shares having a value determined by the Nominating and Governance Committee of the Board of Directors, historically set at $20,000 (based on the Black-Scholes option pricing model), and an exercise price equal to the fair market value of the Company’s common stock on the date of grant. Individuals who became non-employee directors other than at an annual meeting were at the time of their election or appointment as a non-employee director awarded stock options for shares having a value prorated to reflect a partial year’s service. The options awarded under the Directors’ Compensation Plan were not exercisable prior to the day after the six-month anniversary of the grant date and expire no later than 10 years after the date of grant. A total of 178,126 shares of the Company’s common stock is available for grant under the Directors’ Compensation Plan.

40

On April 16, 2003, seven directors were granted a total of 35,700 option shares at an option price of $6.43 per share. Half of the options vested on October 17, 2003 with the remaining option shares vesting on April 16, 2004.

On May 8, 2002, seven directors were granted a total of 30,170 option shares at an option price of $11.21 per share. All of the option shares granted in 2002 have vested. On April 18, 2001, seven directors were granted a total of 31,990 option shares at an option price of $10.48 per share. All of the option shares granted in 2001 have vested.

Note 7:    Stockholder Rights Plan

Pursuant to a stockholder rights plan, on November 25, 1997, the Company’s Board of Directors declared a dividend distribution, payable to stockholders of record on December 17, 1997, of one preferred stock purchase right (a “Right”) for each outstanding share of the Company’s common stock. The Rights will expire December 17, 2007. On September 22, 1999, the stockholder rights plan was amended. Under this amended Plan, the Rights will separate from the common stock and a distribution will occur upon the earlier of (i) ten days following an announcement that a person or group has acquired beneficial ownership of 10 percent or more of the outstanding common stock or the date a person enters an agreement providing for certain acquisition transactions or (ii) ten business days following publication of a tender or exchange offer that would result in any person or group beneficially owning 10 percent or more of the common stock (or a later date as the Board determines). Any person that publicly announced prior to September 22, 1999 that it holds 10 percent or more of the outstanding common stock (“Existing 10% Stockholder”) will not cause a distribution to occur unless that person acquires additional common stock resulting in ownership of 15 percent or more.

In the event that any person or group acquires 10 percent or more of the outstanding shares of common stock (15% in the case of an Existing 10% Stockholder), each Right will entitle the holder, other than such acquiring person or group, to purchase that number of shares of common stock of the Company having a market value of twice the exercise price of the Right. At any time thereafter if the Company consummates certain business combination transactions or sells substantially all of its assets, each Right will entitle the holder, other than the person or group acquiring 10 percent or more of the outstanding shares of common stock, to purchase that number of shares of the surviving company stock which at the time of the transaction would have a market value of twice the exercise price of the Right. The preceding sentences will not apply to (i) persons who acquire common stock pursuant to an offer for all outstanding shares of common stock which the independent directors determine to be fair to and otherwise in the best interest of the Company and its stockholders after receiving advice from one or more investment banking firms and (ii) certain persons owning less than 15 percent of the outstanding common stock (20 percent of the outstanding common stock in the case of an Existing 10% Stockholder) who report their ownership on Schedule 13G under the Securities Exchange Act of 1934 or on Schedule 13D under the Exchange Act, provided that they do not state any intention to or reserve the right to control or influence the Company and such persons certify that they acquired their shares inadvertently and will not acquire any additional shares of common stock.

The Rights will not have voting rights and, subject to certain exceptions, will be redeemable at the option of the Company at a price of one cent per Right (subject to adjustments) at any time prior to the close of business on the fifteenth day following public announcement that a person or group has acquired beneficial ownership of 10 percent or more of the outstanding common stock or the date a person enters an agreement providing for certain acquisition transactions. Any Rights held by a person triggering a distribution date will become null and void. The Board may exchange all or part of the Rights, except for those acquired by the person or group acquiring 10 percent or more of the outstanding shares of common stock, for shares of common or preferred stock of the Company. Until a Right is exercised, the holder will have no rights as a stockholder. While the distribution of the Rights will not be taxable to stockholders or the Company, stockholders may recognize taxable income if the rights become exercisable.

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Note 8:    Derivatives and Fair Value of Financial Instruments

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value.

Derivatives

The Company has only limited involvement with derivative financial instruments and does not use them for speculative or trading purposes.

Cash and Cash Equivalents

The carrying amount of cash equivalents approximates fair value because of the short maturity of those instruments.

Long-Term Debt

The estimated fair value of the Company’s long-term debt and the current portions thereof using quoted market prices of Company debt securities recently traded and market-based prices of similar securities for those securities not recently traded was $273 million at December 31, 2003 and $225 million at December 31, 2002, as compared with the carrying value of $266 million and $220 million at year-end 2003 and 2002, respectively.

Note 9:    Retirement Benefits

Prior to January 1, 1998, the Company’s non-contributory defined benefit pension plan covered certain employees, retirees and their beneficiaries. Benefits provided to participants of the plan were based on pay and years of service for salaried employees and years of service and a fixed rate or a rate determined by job grade for all wage employees, including employees under collective bargaining agreements.

Effective January 1, 1998, the Company froze the benefits accrued under its defined benefit pension plan for certain salaried employees, and instituted a defined contribution plan. Effective March 31, 2000, benefits for certain salaried employees of J. M. Tull Metals Company and AFCO Metals were similarly frozen, with the employees becoming participants in the Company’s defined contribution plan. Salaried employees who vested in their benefits accrued under the defined benefit plan at December 31, 1997, and March 31, 2000, are entitled to those benefits upon retirement. Certain transition rules have been established for those salaried employees meeting specified age and service requirements. For 2003, 2002 and 2001, expense recognized for such defined contribution plan was $3.6 million, $5.9 million and $6.5 million, respectively.

The Company has other deferred employee benefit plans, including a supplemental pension plan, the liability for which totaled $4.7 million at year-end 2003 and $4.8 million at year-end 2002.

The tables included below provide reconciliations of benefit obligations and fair value of plan assets of the Company plans as well as the funded status and components of net periodic benefit costs for each period related to each plan. The assumptions used to determine the information below related to Pension Benefits were as follows:

	2003		2002
Discount rate for calculating obligations	6.25	%	6.75	%
Discount rate for calculating net periodic benefit cost	6.75		7.50
Expected rate of return on plan assets	8.75		9.50
Rate of compensation increase	4.00		4.00

The expected rate of return on plan assets is 8.75% for 2004.

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The assumptions used to determine the information below related to Other Postretirement Benefits, primarily health care, were as follows:

	2003		2002
Discount rate for calculating obligations	6.00	%	6.75	%
Discount rate for calculating net periodic benefit cost	6.75		7.50
Rate of compensation increase	4.00		4.00

	Year ended September 30
	Pension Benefits						Other Benefits
	2003			2002			2003			2002
	(Dollars in millions)
Change in Benefit Obligation
Benefit obligation at beginning of year	$	379		$	359		$	175		$	162
Service cost		3			4			3			2
Interest cost		25			26			11			12
Plan amendments		4			—			(19	)		(2	)
Actuarial loss		31			15			21			10
Company restructuring		2			1			1			1
Benefits paid		(27	)		(26	)		(12	)		(10	)
Benefit obligation at end of year	$	417		$	379		$	180		$	175
Accumulated benefit obligation at end of year	$	415		$	378			N/A			N/A
Change in Plan Assets
Plan assets at fair value at beginning of year	$	245		$	294			—			—
Actual return on plan assets		41			(28	)		—			—
Employer contributions		56			5			12			10
Benefits paid (net of participant contributions)		(27	)		(26	)		(12	)		(10	)
Plan assets at fair value at end of year	$	315		$	245			—			—
Reconciliation of Prepaid (Accrued) and Total Amount Recognized
Funded status	$	(102	)	$	(134	)	$	(180	)	$	(175	)
Unrecognized net (gain)/loss		167			152			59			40
Unrecognized prior service cost		10			7			(32	)		(15	)
Prepaid (accrued) benefit cost at September 30		75			25			(153	)		(150	)
Change in account, October-December		—			—			3			3
Net amount recognized at December 31	$	75		$	25		$	(150	)	$	(147	)
Amounts recognized in statement of financial position consist of:
Prepaid (accrued) benefit cost	$	—		$	—		$	(153	)	$	(150	)
Accrued benefit liability		(100	)		(133	)		—			—
Intangible asset		10			7			—			—
Accumulated other comprehensive income		165			151			—			—
Change in account, October-December		—			—			3			3
Net amount recognized	$	75		$	25		$	(150	)	$	(147	)

For measurement purposes, the annual rate of increase in the per capita cost of covered health care benefits was 9 percent in 2003, grading down to 5 percent in 2009, the level at which it is expected to remain.

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	Pension Benefits						Other Benefits
	2003			2002			2003			2002
	(Dollars in millions)
Components of net periodic benefit cost
Service cost	$	3		$	4		$	3		$	2
Interest cost		25			26			11			12
Expected return on assets		(28	)		(30	)		—			—
Amortization of prior service cost		1			1			(2	)		(2	)
Recognized actuarial (gain)/loss		3			—			1			1
Net periodic benefit cost	$	4		$	1		$	13		$	13

The assumed health care cost trend rate has an effect on the amounts reported for the health care plans. For purposes of determining net periodic benefit cost, the annual rate of increase in the per capita cost of covered health care benefits was 10 percent in 2003, grading down to 5 percent in 2007. A one-percentage-point change in the assumed health care cost trend rate would have the following effects:

	1% increase		1% decrease
	(Dollars in Thousands)
Effect on service cost plus interest cost	$	514	$	(410	)
Effect on postretirement benefit obligation		3,323		(2,648	)

Additional Information

	Pension Benefits				Other Benefits
	2003		2002		2003	2002
	(Dollars in millions)
Increase in minimum liability included in other comprehensive income, net of tax	$	8.5	$	44.7	N/A	N/A

Pension Trust Assets

The expected long-term rate of return on pension trust assets is 8.75% based on the historical investment returns of the trust, the forecasted returns of the asset classes and a survey of comparable pension plan sponsors.

The Company’s pension trust weighted-average asset allocations at September 30, 2003 and 2002, by asset category are as follows:

	Trust Assets at September 30
	2003		2002
Equity securities	66.2	%	73.7	%
Debt securities	23.8		20.8
Real estate	5.2		5.5
Other	4.8		—
Total	100.0	%	100.0	%

The Compensation Committee of the Board of Directors has general supervisory authority over the Pension Trust Fund and approves the investment policies and plan asset target allocation. An internal management committee provides on-going oversight of plan assets in accordance with the approved policies and asset allocation ranges and has the authority to appoint and dismiss investment managers. The investment policy objectives are to maximize long-term return from a diversified pool of assets while minimizing the risk of large losses, and to maintain adequate liquidity to permit timely payment of all benefits. The policies include diversification requirements and restrictions on concentration in any one single issuer or asset class. The

44

currently approved asset investment classes are cash; fixed income; domestic equities; international equities; real estate; private equities and hedge funds of funds. Company management allocates the plan asset among the approved investment classes and provides appropriate directions to the investment managers pursuant to such allocations. The approved target ranges and allocations as of September 30, 2003 and September 30, 2002 were as follows:

	Range		Target
Equity securities	30-85	%	75	%
Debt securities	5-50		10
Real estate	0-15		10
Other	0-15		5
Total			100	%

Equity securities include Ryerson Tull common stock in the amounts of $1.0 million (0.3 percent of total plan assets) and $0.8 million (0.3 percent of total plan assets) at September 30, 2003 and 2002, respectively.

Contributions

The Company has no required ERISA contributions for 2004, but may elect to make a voluntary contribution to improve the funded ratio of the plan. At December 31, 2003, the Company does not have an estimate of such potential contribution in 2004.

Note 10:    Restructuring Charge

2003

In the fourth quarter of 2003, the Company recorded a charge of $3.8 million as a result of consolidating plants in the Midwest and South regions of the United States. Included in the charge was severance for 58 employees. Also included was $0.9 million for additional rent at a facility that was closed in the 2000 restructuring. The restructuring actions associated with the $3.8 million charge will be completed by mid-2004. In the third quarter of 2003, the Company recorded a charge of $0.9 million as a result of consolidating plants in the East and Central Mountain regions and consolidating sales and administrative services in the Pacific Northwest. Included in the charge was severance for 53 employees. The restructuring actions associated with the $0.9 million charge have been completed. In the second quarter of 2003, the Company recorded a charge of $1.5 million as a result of workforce reductions. The charge consists of employee-related costs, including severance for 17 employees. The restructuring actions associated with the $1.5 million charge have been completed.

Excluding the $0.9 million adjustment to the 2000 restructuring, 2003 restructuring and plant closure costs totaled $5.3 million. This charge consists of employee-related and tenancy costs and will be used for future cash outlays. During 2003, the Company utilized $3.4 million of the $5.3 million charge. The December 31, 2003 reserve balance of $1.9 million is related primarily to employee costs and will be paid through 2005.

2002

In the second quarter of 2002, the Company recorded a charge of $2.0 million for costs associated with the closure of a facility in the southern United States. The charge consisted primarily of employee-related cash costs. Included in the charge was severance for 40 employees. The restructuring actions have been completed. During the first quarter of 2003, the Company utilized the remaining year-end 2002 reserve balance of $0.3 million.

2001

In the fourth quarter of 2001, the Company recorded a restructuring charge of $19.4 million as a result of workforce reductions and plant consolidation. In the third quarter of 2002, the Company recorded a charge of

45

$0.7 million as an adjustment to the $19.4 million recorded in 2001 resulting in a total restructuring charge of $20.1 million. The $20.1 million charge consists of $10.3 million of non-cash asset write-offs and $9.8 million of future cash outlays for employee-related costs and tenancy costs. The additional $0.7 million charge recorded in 2002 was due to a reduction in the market value of assets in a multi-employer pension plan from the initial estimate in 2001 to the final calculation of the withdrawal liability in 2002. The remaining multi-employer pension plan withdrawal liability of $1.1 million will be funded through 2005. As part of the restructuring, certain facilities in Michigan were closed and the Company consolidated two facilities into one location in Chicago. Included in the charge was severance for 178 employees. The 2001 restructuring actions were completed by year-end 2002. During 2003, the Company utilized $1.7 million of the 2001 restructuring reserve. The December 31, 2003 reserve balance of $1.5 million is related to employee and tenancy costs.

In preparation for the Company’s planned disposition of one of the properties in Chicago, the Company retained an environmental consultant to conduct Phase I and Phase II environmental studies. Based on the consultant’s reports on environmental contaminants at the site, the Company believes that the $2 million reserve established in the fourth quarter of 2001 is adequate to cover potential remediation costs for environmental issues identified in the consultant’s reports.

2000

During 2000, the Company recorded a restructuring charge of $23.3 million, consisting of $10.7 million of asset write-offs and $12.6 million of future cash outlays for employee-related costs and tenancy costs. The charge was the result of realigning geographic divisions to improve responsiveness to local markets, exiting non-core businesses and centralizing administrative services to achieve economies of scale. Included in the charge was severance for 319 employees. The restructuring actions were completed by December 31, 2000. Based on court rulings in the fourth quarter of 2003, the Company recorded an additional $0.9 million reserve for future lease payments for a facility closed in the 2000 restructuring. During 2003, the Company utilized $1.0 million of the restructuring reserve. The December 31, 2003 reserve balance of $3.4 million is related to tenancy and other costs that will be paid through 2008.

Note 11:    Income Taxes

The elements of the provisions for income taxes related to continuing operations for each of the three years indicated below were as follows:

	Year ended December 31
	2003			2002			2001
	(Dollars in millions)
Current income taxes:
Federal	$	—		$	—		$	(1.8	)
State and foreign		0.5			1.4			(0.1	)
		0.5			1.4			(1.9	)
Deferred income taxes		(2.5	)		(8.7	)		(37.7	)
Total tax expense (benefit)	$	(2.0	)	$	(7.3	)	$	(39.6	)

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Income taxes on continuing operations differ from the amounts computed by applying the federal tax rate as follows:

	Year ended December 31
	2003			2002			2001
	(Dollars in millions)
Federal income tax expense computed at statutory tax rate of 35%	$	(5.6	)	$	(6.9	)	$	(34.9	)
Additional taxes or credits from:
State and local income taxes, net of federal income tax effect		(2.5	)		(3.0	)		(4.0	)
Non-deductible expenses		0.7			(0.5	)		2.9
Capital loss carryback		—			—			(2.3	)
Foreign losses not includable in federal taxable income		(0.3	)		(0.5	)		0.6
Canadian taxes		—			0.6			(0.5	)
Change in estimate		1.1			2.4			(1.0	)
Valuation allowance		4.5			0.6			—
All other, net		0.1			—			(0.4	)
Total income tax provision (benefit)	$	(2.0	)	$	(7.3	)	$	(39.6	)

The components of the deferred income tax assets and liabilities arising under FASB Statement No. 109 were as follows:

	December 31
	2003			2002
	(Dollars in Millions)
Deferred tax assets:
AMT tax credit carryforwards	$	60		$	56
FASB Statement No. 106 impact (post-retirement benefits other than pensions)		58			58
General business credit carryforwards		1			1
Federal net operating loss carryforwards		14			—
State net operating loss carryforwards		17			13
Bad debt allowances		4			4
Pension liability		37			49
Amortization (goodwill and purchase accounting adjustment)		13			15
Other deductible temporary differences		15			17
Less valuation allowances		(5	)		(1	)
		214			212
Deferred tax liabilities:
Fixed asset basis difference		47			48
Inventory basis difference		34			30
Other taxable temporary differences		1			2
		82			80
Net deferred tax asset	$	132		$	132

The Company had available at December 31, 2003, federal AMT credit carryforwards of approximately $60 million, which may be used indefinitely to reduce regular federal income taxes. The Company had available at December 31, 2003, federal net operating loss (“NOL”) carryforwards of approximately $14 million which expire during the years 2022 and 2023. The Company also had other federal general business credit carryforwards for tax purposes of approximately $1 million, which expire during the years 2004 through 2009. The Company believes that it is more likely than not that all of its federal tax credits and NOL’s will be realized.

47

At December 31, 2003, the deferred tax asset related to the Company’s post-retirement benefits other than pensions (“FASB Statement No. 106 obligation”) was $58 million. At December 31, 2003, the Company also had a deferred tax asset related to the Company’s pension liability of $37 million. To the extent that future annual charges under FASB Statement No. 106 and the pension expense continue to exceed amounts deductible for tax purposes, this deferred tax asset will continue to grow. Thereafter, even if the Company should have a tax loss in any year in which the deductible amount would exceed the financial statement expense, the tax law provides for a 20-year carryforward period of that loss. Because of the long period that is available to realize these future tax benefits and the long-term nature of the related liabilities, these items are treated as having an indefinite reversal period and a valuation allowance for this deferred tax asset is not considered necessary.

The Company had $17 million of state NOL carryforwards available at December 31, 2003. The deferred tax asset for state NOL carryforwards as reviewed for recoverability based on historical taxable income, the expected reversals of existing temporary differences, tax planning strategies, and, most importantly, on projections of future taxable income. As a result of its analysis, the Company recorded an additional valuation allowance of $4.5 million in the current year as part of its income tax provision. The cumulative valuation allowance of $5.1 million as of December 31, 2003 relates to the NOL’s for thirteen specific state and local jurisdictions. Ten of these jurisdictions have a 3-5 year carryforward period, and all of the NOL’s associated with these ten jurisdictions have been included in the valuation allowance. In addition, a significant portion of the NOL’s for an additional three jurisdictions have been included in the valuation allowance to the extent that the Company does not expect to be able to utilize all of these specific NOL’s prior to their expiration in 2015-2023.

Note 12:    Goodwill

On January 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets” (“SFAS 142”). The Company has two reporting units, one comprised of its general line (“General Line”) service centers and the other comprised of its coil processing (“Coil Processing”) facilities. The Company estimated the fair value of its reporting units using a present value method that discounted future cash flows. The cash flow estimates incorporate assumptions on future cash flow growth, terminal values and discount rates. Any such valuation is sensitive to these assumptions. Because the fair value of each reporting unit was below its carrying value (including goodwill), application of SFAS 142 required the Company to complete the second step of the goodwill impairment test and compare the implied fair value of each reporting unit’s goodwill with the carrying value of that goodwill. As a result, the Company recorded an impairment charge of $91.1 million ($82.2 million after-tax) to write-off the entire goodwill amount as a cumulative effect of a change in accounting principle. The General Line goodwill impairment charge was $71.4 million after-tax while the Coil Processing goodwill impairment charge was $10.8 million after-tax.

The Financial Accounting Standards Board also issued Statement of Accounting Standards No. 141 (“SFAS 141”), “Business Combinations,” which requires all business combinations after June 30, 2001 to be accounted for under the purchase method.

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The following table presents a comparison of the 2003 results to 2002 and 2001 results adjusted to exclude goodwill amortization expense:

	In Millions (except per share data) Year ended December 31
	2003			2002			2001
Income (loss) before cumulative effect of change in accounting principle	$	(14.1	)	$	(14.1	)	$	(60.2	)
Cumulative effect of change in accounting principle		—			(82.2	)		—
Reported net income (loss)		(14.1	)		(96.3	)		(60.2	)
Addback: goodwill amortization, net of tax		—			—			4.2
Adjusted net income (loss)	$	(14.1	)	$	(96.3	)	$	(56.0	)
Basic earnings (loss) per share:
Reported net income (loss)	$	(0.58	)	$	(3.89	)	$	(2.44	)
Addback: goodwill amortization, net of tax		—			—			0.17
Adjusted net income (loss)	$	(0.58	)	$	(3.89	)	$	(2.27	)
Diluted earnings (loss) per share:
Reported net income (loss)	$	(0.58	)	$	(3.89	)	$	(2.44	)
Addback: goodwill amortization, net of tax		—			—			0.17
Adjusted net income (loss)	$	(0.58	)	$	(3.89	)	$	(2.27	)

Note 13:    Earnings Per Share

	2003			2002			2001
Basic earnings (loss) per share	(Dollars and Shares in Millions (except per share data))
Income (loss) from continuing operations	$	(14.1	)	$	(12.4	)	$	(60.2	)
Less preferred stock dividends		0.2			0.2			0.2
Income (loss) from continuing operations available to common stockholders		(14.3	)		(12.6	)		(60.4	)
Gain (loss) on sale of discontinued operations		—			(1.7	)		—
Income (loss) before cumulative effect of change in accounting principle		(14.3	)		(14.3	)		(60.4	)
Cumulative effect of change in accounting principle		—			(82.2	)		—
Net income (loss) available to common stockholders	$	(14.3	)	$	(96.5	)	$	(60.4	)
Average shares of common stock outstanding		24.8			24.8			24.8
Basic earnings (loss) per share
From continuing operations	$	(0.58	)	$	(0.51	)	$	(2.44	)
Gain (loss) on sale of discontinued operations		—			(0.07	)		—
Cumulative effect of change in accounting principle		—			(3.31	)		—
Basic earnings (loss) per share	$	(0.58	)	$	(3.89	)	$	(2.44	)

49

	2003			2002			2001
Diluted earnings (loss) per share	(Dollars and Shares in Millions (except per share data))
Income (loss) from continuing operations available to common stockholders	$	(14.3	)	$	(12.6	)	$	(60.4	)
Gain (loss) on sale of discontinued operations		—			(1.7	)		—
Cumulative effect of change in accounting principle		—			(82.2	)		—
Net income (loss) available to common stockholders and assumed conversions	$	(14.3	)	$	(96.5	)	$	(60.4	)
Average shares of common stock outstanding		24.8			24.8			24.8
Dilutive effect of stock options		—			—			—
Shares outstanding for diluted earnings per share calculation		24.8			24.8			24.8
Diluted earnings (loss) per share
From continuing operations	$	(0.58	)	$	(0.51	)	$	(2.44	)
Gain (loss) on sale of discontinued operations		—			(0.07	)		—
Cumulative effect of change in accounting principle		—			(3.31	)		—
Diluted earnings (loss) per share	$	(0.58	)	$	(3.89	)	$	(2.44	)

Options to purchase 3,871,747 shares of common stock at prices ranging from $6.43 to $48.44 per share were outstanding under the Company’s Incentive Stock Plan and Directors’ Compensation Plan during 2003, but were not included in the computation of diluted EPS because to do so would be antidilutive. In 2002, options to purchase 2,929,433 shares of common stock at prices ranging from $8.88 to $48.44 per share were outstanding, but were not included in the computation of diluted EPS because to do so would be antidilutive. In 2001, options to purchase 2,973,744 shares of common stock at prices ranging from $8.88 to $48.44 per share were outstanding, but were not included in the computation of diluted EPS because to do so would be antidilutive.

Note 14:    Restricted Cash

In the first quarter of 2002, the Company recorded a $5.1 million pretax gain for the receipt of shares as a result of the demutualization of one of its insurance carriers, Prudential. This gain represents a portion of the total of $6.3 million of shares received. The remaining shares are attributable to participants of the optional life insurance plan and therefore the liability has been recorded as a benefit payable.

In the second quarter of 2002, the Company sold all of the shares received. As a result of the sale, the Company recorded in the second quarter income of $0.6 million, its allocable share of the gain on sale. This item is included in “other income and expense, net.” The portion of the sale proceeds attributable to optional life insurance plan participants ($1.3 million) is required to be used for the benefit of plan participants and as such, has been recorded as “restricted cash” in the Consolidated Balance Sheet. The restricted cash balance has earned interest totaling $0.1 million as of December 31, 2003. In the third quarter of 2002, the Company began making payments for the benefit of optional life insurance plan participants. At December 31, 2003, these payments totaled $0.3 million.

Note 15:    Revenue by Product

The following table shows the Company’s percentage of sales revenue by major product lines for 2003, 2002 and 2001:

	Percentage of Sales Revenues
Product Line	2003		2002		2001
Carbon flat rolled	37	%	34	%	35	%
Stainless and aluminum	34		33		30
Fabrication and carbon plate	13		15		16
Bars, tubing and structurals	13		14		15
Other	3		4		4
Total	100	%	100	%	100	%

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Note 16:    Commitments and Contingencies

ISC/Ispat Transaction

In 1998, Ryerson Tull, Inc. (together with its subsidiaries, the “Company”) sold its steel manufacturing segment (“ISC”) to Ispat International N.V. and certain of its affiliates (“Ispat”) pursuant to an agreement of sale and merger (the “ISC/Ispat Merger Agreement”). Pursuant to that agreement, the Company agreed to indemnify Ispat up to $90 million for losses incurred in connection with breaches of representations and warranties contained in the agreement and for expenditures and losses incurred relating to certain environmental liabilities. Ispat was required to make all such indemnification claims prior to March 31, 2000, other than claims related to tax matters, certain organizational matters and environmental matters. On May 29, 2001, the Company entered into a settlement agreement with Ispat that settled certain of such claims, other than those related to environmental liabilities and certain property tax matters, for approximately $15 million, which applied against the $90 million indemnification cap. Ispat also notified the Company of certain environmental matters of which Ispat was aware, of certain environmental expenses that it had incurred or might incur, of certain property tax matters and other matters arising under ISC/Ispat Merger Agreement for which Ispat believed it was entitled to indemnification under that agreement.

In an agreement signed on September 15, 2003 (the “Settlement Agreement”), the Company and Ispat settled all environmental and other indemnification claims between them related to the Company’s indemnification obligations under the ISC/Ispat Merger Agreement and certain matters related to the Ispat Pension Plan. The Settlement Agreement has the following key components:

On September 15, 2003, the Company contributed $21 million to the Ispat Pension Plan and Ispat released the Company from any remaining environmental and other indemnification obligations arising out of the ISC/Ispat transaction. The Company had previously established an accrual to cover this $21 million payment.

Ispat agreed to make specified monthly contributions to the Ispat Pension Plan totaling $29 million over the twelve-month period beginning January 2004, which will reduce and discharge the Company’s Letter of Credit to the PBGC on a dollar-for-dollar basis.

Ispat agreed to reimburse the Company for all fees or expenses (including interest expenses) payable to the provider or other person participating in the Letter of Credit (or any extension or replacement thereof) incurred by the Company in connection with (i) the Letter of Credit, (ii) any extension or replacement of the Letter of Credit, or (iii) any PBGC draw on the Letter of Credit or on any extension or replacement of the Letter of Credit.

If Ispat or any of its affiliates or subsidiaries receives any environmental insurance proceeds as a result of a claim related to the Company’s environmental indemnification obligations under the ISC/Ispat Merger Agreement, Ispat has agreed to pay the Company one-third of such proceeds (minus reimbursement of Ispat’s attorneys’ or other fees and expenses incurred in connection with pursuing such claims), up to a maximum amount of $21 million.

Under the ISC/Ispat Merger Agreement, Ispat and the Company agreed to the sharing of any property tax refunds resulting from the appeal of certain real estate property tax assessments. Under the Settlement Agreement, Ispat agreed to pay to the Ispat Pension Plan an amount equal to the cash received or the face amount of any credit or non-cash refund which Ispat is entitled to and receives related to property tax refunds or credits arising out of the appeals of certain real estate property tax assessments. Any such payments will pro-rata reduce Ispat’s monthly contributions to its pension plan as required by the Settlement Agreement, which contributions will reduce and discharge the Company’s Letter of Credit to the PBGC on a dollar-for-dollar basis.

On September 15, 2003, the Company entered into an agreement with Ispat and the PBGC under which the PBGC agreed that any contributions described above (the “Contributions”) made by Ispat or the Company to the Ispat Pension Plan would reduce and discharge the Letter of Credit and the Company’s guaranty on a dollar-for- dollar basis, until each of the Letter of Credit and the guaranty has been reduced to zero. The Company has a $5.5 million liability recorded related to this guaranty to the PBGC. Except for claims which could be made

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under Employee Retirement Income Security Act of 1974, as amended, for the period in which the Company was the sponsor of the Ispat Pension Plan, after these Contributions have been made, the Company will have no further liability with respect to the Ispat Pension Plan.

Lease Obligations & Other

The Company has noncancellable operating leases for which future minimum rental commitments are estimated to total $71.4 million, including approximately $13.4 million in 2004, $11.8 million in 2005, $10.2 million in 2006, $7.3 million in 2007, $6.7 million in 2008 and $22.0 million thereafter.

Rental expense under operating leases totaled $16.4 million in 2003, $17.2 million in 2002 and $19.3 million in 2001.

To fulfill contractual requirements for certain customers in 2004, the Company has entered into certain fixed-price noncancellable contractual obligations. These purchase obligations aggregated $27 million at December 31, 2003.

There are various claims and pending actions against the Company other than those related to the ISC/Ispat transaction. The amount of liability, if any, for those claims and actions at December 31, 2003 is not determinable but, in the opinion of management, such liability, if any, will not have a material adverse effect on the Company’s financial position, results of operations or cash flows.

Note 17:    Other Matters

Adjustment to the gain on sale of Inland Engineered Materials Corporation

In 2002, the Company recorded a pretax charge of $8.5 million in connection with the settlement of litigation. The charge was recorded as a selling price adjustment to the 1998 sale of Inland Engineered Materials Corporation.

China

In 2002, the Company realized a gain of $4.1 million representing the proceeds on the sale of the Company’s 49 percent interest in Shanghai Ryerson Limited.

Mexico

In the third quarter of 2003, the Company and G. Collado S.A. de C.V. formed Collado Ryerson, a joint venture that will enable the Company to expand service capability in Mexico. The Company invested $3.4 million in the joint venture for a 49 percent equity interest. The investment is accounted for as a cash outflow from investing activities.

In March 2000, the Company and Altos Hornos de Mexico, S.A. de C.V. (“AHMSA”) entered into an agreement to sell the Company’s 50 percent interest in their joint venture, Ryerson de Mexico, to AHMSA for $15 million, with payment due in July 2000. Upon finalizing the terms of payment for the sale, the Company exchanged its ownership in the joint venture for inventory and the joint venture’s Guadalajara facility. The cash received from the sale of the inventory, which amounted to $2.8 million in 2002 and $8.4 million in 2001, is accounted for as cash inflow from operating activities. The Company continues to own the Guadalajara facility. In a separate transaction, on December 27, 2001, the Company sold its subsidiary, Ryerson Industries de Mexico, S.A. de C.V. to Grupo Collado, S.A. de C.V. As a result the Company recorded a $3.3 million loss in 2001 on the sale of its Mexican interests.

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Tata Ryerson Limited

The Company owns a 50 percent interest in Tata Ryerson Limited, a joint venture with the Tata Iron & Steel Corporation, an integrated steel manufacturer in India. Tata Ryerson Limited, which was formed in 1997, is a metals service center and processor with processing facilities at Jamshedpur, Pune, Bara, Howrah, Faridabad and Chennai, India. The impact of Tata Ryerson’s operations on the Company’s results of operations has not been material in any year held since inception.

IMF Steel International, Inc.

During the third quarter of 2001, the Company and The MacSteel Group dissolved their joint venture, IMF Steel International, Inc. As a result of the dissolution, the Company received $2.9 million, which is accounted for as a cash inflow from investing activities. This transaction had no impact on the net earnings for the period.

MetalSite, Inc.

During the second quarter of 2001, the Company recorded a $1.0 million charge to write-off its investment in MetalSite, Inc., which was an Internet steel marketplace that halted commercial operations in the second quarter.

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RYERSON TULL, INC. AND SUBSIDIARY COMPANIES

SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS

For the Years Ended December 31, 2003, 2002 and 2001

(Dollars in Millions)

	Provisions for Allowances
Year Ended December 31,	Balance at Beginning of Year		Additions Charged to Income		Deductions from Reserves			Balance at End of Year
2003 Allowance for doubtful accounts	$	9.9	$	5.0	$	(3.2	)(A)	$	11.7
Valuation allowance—deferred tax assets		0.6		4.5		—			5.1
2002 Allowance for doubtful accounts	$	10.7	$	7.5	$	(6.8	)(A)	$	9.9
						(1.5	)(B)
Valuation allowance—deferred tax assets		—		0.6		—			0.6
2001 Allowance for doubtful accounts	$	24.5	$	7.3	$	(20.2	)(A)	$	10.7
						(0.9	)(B)
Valuation allowance—deferred tax assets		—		—		—			—

NOTES:

(A) Bad debts written off during the year

(B) Allowances granted during the year

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ITEM 9.    DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

None.

ITEM 9A.    CONTROLS AND PROCEDURES

Evaluations required by Rule 13a-15 of the Securities Exchange Act of 1934 of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this Report have been carried out under the supervision and with the participation of the Company’s management, including its Chief Executive Officer and Chief Financial Officer. Based upon such evaluations, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective. There have been no changes in the Company’s internal controls over financial reporting during the period covered by this report that were identified in connection with the evaluation referred to above that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART III

ITEM 10.    DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

The information called for by this Item 10 with respect to directors of Ryerson Tull is set forth under the caption “Election of Directors” in Ryerson Tull’s definitive Proxy Statement which will be furnished to stockholders in connection with the Annual Meeting of Stockholders to be held on April 21, 2004, and is hereby incorporated by reference herein. The information called for with respect to executive officers of Ryerson Tull is included in Part I of this Annual Report on Form 10-K under the caption “Executive Officers of Registrant.”

The information called for by this Item 10 with respect to the “audit committee financial expert” is set forth under the caption “Committees of the Board of Directors—Audit Committee” in Ryerson Tull’s definitive Proxy Statement which will be furnished to stockholders in connection with the Annual Meeting of Stockholders to be held on April 21, 2004, and is hereby incorporated by reference.

Section 16(a) Beneficial Ownership Compliance: Based solely upon a review of Forms 3 and 4 and amendments thereto furnished to the Company pursuant to Rule 16a-3(e) during 2003 and Form 5 and amendments thereto furnished of the Company with respect to 2003, and representations from reporting persons that no Form 5 is required with respect to 2003, the Company is not aware of any person who, at any time during 2003, was a director, officer, beneficial owner of more than 10 per cent of any class of equity securities of the Company registered pursuant to Section 12 of the Securities Exchange Act of 1934, that failed to file on a timely basis, as disclosed in the above Forms, reports required by Section 16(a) of the Exchange Act during 2003 or the Company’s prior fiscal years.

Code of Ethics: The Company has adopted a code of ethics, that applies to its principal executive officer, principal financial officer, and principal accounting officer and controller. The text of this code of ethics is contained in the “Ryerson Tull Code of Ethics and Business Conduct” posted on the Company’s Internet website www.ryersontull.com under the reference “Investor Information—Corporate Governance.” The Company intends to satisfy its disclosure requirements regarding an amendment to, or waiver from, a provision of its code of ethics as defined by Regulation S-K Item 406 that applies to its principal executive officer, principal financial officer, controller and principal accounting officer, and that relates to any element of such code of ethics, by posting such information on its Internet website at www.ryersontull.com.

ITEM 11.    EXECUTIVE COMPENSATION.

The information called for by this Item 11 is set forth under the caption “Executive Compensation” in Ryerson Tull’s definitive Proxy Statement which will be furnished to stockholders in connection with the Annual Meeting of Stockholders to be held on April 21, 2004, and is hereby incorporated by reference herein.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

The information called for by this Item 12 with respect to the Company’s common stock that may be issued upon the exercise of options under all of the Company’s equity compensation plans is set forth under the caption “Equity Compensation Plan Information” in Ryerson Tull’s definitive Proxy Statement, which will be furnished to stockholders in connection with the Annual Meeting of Stockholders to be held on April 21, 2004, and is hereby incorporated by reference herein.

The information called for by this Item 12 with respect to security ownership of more than five percent of Ryerson Tull’s common stock and the security ownership of management is set forth under the captions “Additional Information Relating to Voting Securities” and “Security Ownership of Directors and Management” in Ryerson Tull’s definitive Proxy Statement which will be furnished to stockholders in connection with the Annual Meeting of Stockholders scheduled to be held on April 21, 2004, and is hereby incorporated by reference herein.

ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

None.

ITEM 14.    PRINCIPAL ACCOUNTANT FEES AND SERVICES.

The information called for by this Item 14 with respect to principal accountant fees and services is set forth under the caption “Auditor Matters” in Ryerson Tull’s definitive Proxy Statement which will be furnished to stockholders in connection with the Annual Meeting of Stockholders scheduled to be held on April 21, 2004, and is hereby incorporated by reference herein.

PART IV

ITEM 15.    EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.

(a) Documents Filed as a Part of This Report.

Exhibits. The exhibits required to be filed by Item 601 of Regulation S-K are listed in the Exhibit Index, which is attached hereto, and incorporated by reference herein.

(b) Reports on Form 8-K.

On January 29, 2004, the Company filed a Current Report on Form 8-K announcing its results of operations for the fourth quarter of 2003 and fiscal year 2003.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, Ryerson Tull, Inc. has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

RYERSON TULL, INC
By:	/S/    NEIL S. NOVICH
	Neil S. Novich
	Chairman, President and Chief Executive Officer

Date: February 27, 2004

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of Ryerson Tull, Inc. and in the capacities and on the dates indicated.

Signature	Title		Date
/S/    NEIL S. NOVICH         Neil S. Novich	Chairman, President and Chief     Executive Officer and Director     (Principal Executive Officer)		February 27, 2004
/S/    JAY M. GRATZ         Jay M. Gratz	Executive Vice President and     Chief Financial Officer     (Principal Financial Officer)		February 27, 2004
/S/    LILY L. MAY         Lily L. May	Vice President, Controller and     Chief Accounting Officer     (Principal Accounting Officer)		February 27, 2004
JAMESON A. BAXTER	Director	) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )
RICHARD G. CLINE	Director
GARY L. CRITTENDEN	Director
JAMES A. HENDERSON	Director		By:    /S/    JAY M. GRATZ Jay M. Gratz Attorney-in-fact February 27 , 2004
GREGORY P. JOSEFOWICZ	Director
MARTHA MILLER DE LOMBERA	Director
JERRY K. PEARLMAN	Director
RONALD L. THOMPSON	Director

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EXHIBIT INDEX

Exhibit Number		Description
3.1		Copy of Certificate of Incorporation, as amended, of Ryerson Tull. (Filed as Exhibit 3.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 1995 (File No. 1-9117), and incorporated by reference herein.)
3.2		By-Laws, as amended (Filed as Exhibit 3.2 to the Company’s Quarterly Report on form 10-Q for the quarter ended March 31, 2003 (File No. 1-9117), and incorporated by reference herein).
4.1		Certificate of Designations, Preferences and Rights of Series A $2.40 Cumulative Convertible Preferred Stock of Ryerson Tull. (Filed as part of Exhibit B to the definitive Proxy Statement of Inland Steel Company dated March 21, 1986 that was furnished to stockholders in connection with the annual meeting held April 23, 1986 (File No. 1-2438), and incorporated by reference herein.)
4.2		Certificate of Designation, Preferences and Rights of Series D Junior Participating Preferred Stock of Ryerson Tull. (Filed as Exhibit 4-D to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 1987 (File No. 1-9117), and incorporated by reference herein.)
4.3		Rights Agreement, dated as of November 25, 1997, as amended and restated as of September 22, 1999, between Ryerson Tull and Harris Trust and Savings Bank, as Rights Agent. (Filed as Exhibit 4.1 to the Company’s amended Registration Statement on Form 8-A/A-2 filed on October 6, 1999 (File No. 1-9117), and incorporated by reference herein.)
4.4		Appointment and Assumption Agreement, dated as of December 2, 2002, between Ryerson Tull and The Bank of New York. (Filed as Exhibit 10.22 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2002 (File No. 1-9117), and incorporated by reference herein.)
4.5		Indenture, dated as of July 1, 1996, between Pre-merger Ryerson Tull and The Bank of New York. (Filed as Exhibit 4.1 to Pre-merger Ryerson Tull’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1996 (File No. 1-11767), and incorporated by reference herein.)
4.6		First Supplemental Indenture, dated as of February 25, 1999, between Ryerson Tull and The Bank of New York. (Filed as Exhibit 4.5 to the Company’s Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-9117), and incorporated by reference herein.)
4.7		Specimen of 9 1/8% Notes due July 15, 2006. (Filed as Exhibit 4.7 to the Company’s Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-9117), and incorporated by reference herein.)
		[The registrant hereby agrees to provide a copy of any other agreement relating to long-term debt at the request of the Commission.]
10.1	*	Ryerson Tull Annual Incentive Plan, as amended (Filed as Exhibit A to the Company’s definitive Proxy Statement on Schedule 14A (File No. 1-11767) dated March 5, 2003 that was furnished to stockholders in connection with the annual meeting held April 16, 2003, and incorporated by reference herein.)
10.2	*	Ryerson Tull 2002 Incentive Stock Plan, as amended
10.3	*	Ryerson Tull 1999 Incentive Stock Plan, as amended (Filed as Exhibit 10.2 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2001 (File No. 1-11767), and incorporated by reference herein.)

* Management contract or compensatory plan or arrangement required to be filed as an exhibit to the Company’s Annual Report on Form 10-K.

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Exhibit Number	Description
10.4*	Ryerson Tull 1996 Incentive Stock Plan, as amended (Filed as Exhibit 10.D to the Company’s Annual Report on Form 10-K for the year ended December 31, 1997 (File No. 1-11767), and incorporated by reference herein.)
10.5*	Ryerson Tull 1995 Incentive Stock Plan, as amended (Filed as Exhibit 10.E to the Company’s Annual Report on Form 10-K for the year ended December 31, 1997 (File No. 1-9117), and incorporated by reference herein.)
10.6*	Ryerson Tull 1992 Incentive Stock Plan, as amended (Filed as Exhibit 10.C to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1995 (File No. 1-9117), and incorporated by reference herein.)
10.7*	Ryerson Tull Supplemental Retirement Plan for Covered Employees, as amended (Filed as Exhibit 10.6 to Company’s Annual Report on Form 10-K for the year ended December 31, 2001 (File No. 1-11767), and incorporated by reference herein.)
10.8*	Ryerson Tull Nonqualified Savings Plan, as amended
10.9*	Excerpt of Company’s Accident Insurance Policy as related to outside directors insurance
10.10*	Ryerson Tull Directors’ 1999 Stock Option Plan (Filed as Exhibit 10.19 to the Company’s Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-9117), and incorporated by reference herein.)
10.11*	Ryerson Tull Directors Compensation Plan, as amended (Filed as Exhibit 10.22 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2002 (File No. 1-9117), and incorporated by reference herein.)
10.12*	Severance Agreement dated January 28, 1998, between the Company and Jay. M. Gratz. (Filed as Exhibit 10.11 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 30, 2002 (File No. 1-9117), and incorporated by reference herein.)
10.13*	Amendment dated November 6, 1998 to the Severance Agreement dated January 28, 1998 referred to in Exhibit 10.13 above between the Company and Jay M. Gratz. (Filed as Exhibit 10.23 to the Company’s Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-9117), and incorporated by reference herein.)
10.14*	Amendment dated June 30, 2000 to the Severance Agreement dated January 28, 1998 referred to in Exhibit 10.13 between the Company and Jay M. Gratz. (Filed as Exhibit 10.14 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2000 (File No. 1-9117), and incorporated by reference herein.)
10.15*	Form of Change in Control Agreement
10.16*	Schedule to Form of Change in Control Agreement as referred to in Exhibit 10.15.
10.17*	Form of Change in Control Agreement
10.18*	Schedule to Form of Change in Control Agreement as referred to in Exhibit 10.17
10.19*	Employment Agreement dated September 1, 1999 between the Company and Jay M. Gratz. (Filed as Exhibit 10.22 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 1999 (File No. 1-9117), and incorporated by reference herein.)

* Management contract or compensatory plan or arrangement required to be filed as an exhibit to the Company’s Annual Report on Form 10-K.

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Exhibit Number		Description
10.20	*	Employment Agreement dated September 1, 1999 between the Company and Gary J. Niederpruem. (Filed as Exhibit 10.23 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 1999 (File No. 1-9117), and incorporated by reference herein.)
10.21	*	Employment Agreement dated December 1, 1999 between the Company and Neil S. Novich. (Filed as Exhibit 10.19 to the Company’s Annual Report on Form 10-K for the year ended December 31, 1999 (File No. 1-9117), and incorporated by reference herein.)
10.22	*	Employment Agreement dated as of July 23, 2001 between the Company and James M. Delaney. (Filed as Exhibit 10.22 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2002 (File No. 1-9117), and incorporated by reference herein.)
10.23	*	Confidentiality and Non-Competition Agreement dated July 1, 1999 between the Company and Stephen E. Makarewicz. (Filed as Exhibit 10.24 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 1999 (File No. 1-9117), and incorporated by reference herein.)
10.24	*	Form of Indemnification Agreement, dated June 24, 2003, between the Company and the parties listed on the schedule thereto (Filed as Exhibit 10.24 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2003 (File No. 1-9117), and incorporated by reference herein.)
10.25	*	Schedule to Form of Indemnification Agreement, dated June 24, 2003
21		List of Certain Subsidiaries of the Registrant
23		Consent of Independent Accountants.
24		Powers of Attorney
31.1		Certificate of the Principal Executive Officer of the Company, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2		Certificate of the Principal Financial Officer of the Company, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1		Written Statement of Neil S. Novich, Chairman, President and Chief Executive Officer of the Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Written Statement of Jay M. Gratz, Executive Vice President and Chief Financial Officer of the Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

* Management contract or compensatory plan or arrangement required to be filed as an exhibit to the Company’s Annual Report on Form 10-K.

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EX-10.2

EXHIBIT 10.2

RYERSON TULL 2002 INCENTIVE STOCK PLAN

(As amended and restated as of January 1, 2004)

1. Purpose.

The purpose of the Ryerson Tull 2002 Incentive Stock Plan (the “Plan”) is to attract and retain outstanding individuals as officers and key employees of Ryerson Tull, Inc. (the “Company”) and its subsidiaries, and to furnish incentives to such individuals through rewards based upon the ownership and performance of the Common Stock (as defined in Section 3). To this end, the Committee hereinafter designated and, in certain circumstances, the Chairman of the Board of the Company (the “Chairman”) or the President of the Company, may grant stock options, stock appreciation rights, restricted stock awards, and performance awards, or combinations thereof, to officers and other key employees of the Company and its subsidiaries, on the terms and subject to the conditions set forth in this Plan. As used in the Plan, the term “RT” shall mean, collectively, the Company and its subsidiaries, and the term “subsidiary” shall mean (a) any corporation of which the Company owns or controls, directly or indirectly, 50% or more of the outstanding shares of capital stock entitled to vote for the election of directors or (b) any partnership, joint venture, or other business entity in respect of which the Company, directly or indirectly, has comparable ownership or control.

2. Participants.

Participants in the Plan shall consist of: (a) such officers and other key employees of the Company and its subsidiaries as the Committee (or an officer acting pursuant to Section 4) in its sole discretion may select from time to time to receive stock options, stock appreciation rights, restricted stock awards or performance awards, either singly or in combination, as the Committee (or an officer acting pursuant to Section 4) may determine in its sole discretion; and (b) if the Committee authorizes the Chairman or the President to make grants or awards of stock options, stock appreciation rights, restricted stock or performance awards, such employees of the Company and its subsidiaries who are not subject to section 16(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) as the Chairman or the President shall determine in his or her sole discretion after consultation with the Vice President-Human Resources of the Company. Any director of the Company or any of its subsidiaries who is not also an employee of the Company or any of its subsidiaries shall not be eligible to receive stock options, stock appreciation rights, restricted stock awards or performance awards under the Plan. Notwithstanding any other provision of the Plan, without the approval of the Company’s stockholders, this Section 2 shall not be amended to materially change the class or classes of employees eligible to participate in the Plan.

3. Shares Reserved under the Plan.

Subject to adjustment pursuant to the provisions of Section 11 of the Plan, the maximum number of shares of Common Stock, $1.00 par value per share, of the Company (“Common Stock”) which may be issued pursuant to grants or awards made under the Plan shall not exceed the sum of (1) 2,500,000 and (2) the total number of shares available for issuance, but not issued, under the Ryerson Tull 1995 and Ryerson Tull 1999 Incentive Stock Plan (the “Prior Plans”), including shares described in the last paragraph of this Section 3. No more than 335,000 shares

of Common Stock shall be issued pursuant to restricted stock awards and performance awards under the Plan. Notwithstanding any other provision of the Plan, without the approval of the Company’s stockholders, this Section 3 shall not be amended to materially increase the number of shares reserved for issuance under the Plan.

The following restrictions shall apply to all grants and awards under the Plan other than grants and awards which, by their terms, are not intended to comply with the “Performance-Based Exception” (defined below in this Section 3):

(a) the maximum aggregate number of shares of Common Stock that may be granted or awarded under the Plan to any participant under the Plan during any three year period shall be 700,000; and

(b) the maximum aggregate cash payout with respect to grants or awards under the Plan in any fiscal year of the Company to any Named Executive Officer (defined below in this Section 3) shall be $1,000,000.

For purposes of the Plan, “Named Executive Officer” shall mean a participant who is one of the group of “covered employees” as defined in the regulations promulgated under section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), or any successor statute, and “Performance-Based Exception” shall mean the performance-based exception from the deductibility limitations as set forth in Section 162(m) of the Code.

Except to the extent otherwise determined by the Committee, any shares of Common Stock subject to grants or awards under the Plan or the Prior Plans that terminate by expiration, cancellation or otherwise without the issuance of such shares (including shares underlying a stock appreciation right exercised for stock, to the extent that such underlying shares are not issued), that are settled in cash (to the extent so settled), or, in the case of restricted stock awards, that terminate without vesting, shall become available for future grants and awards under the Plan. Shares of Common Stock to be issued pursuant to grants or awards under the Plan may be authorized and unissued shares of Common Stock, treasury Common Stock, or any combination thereof.

4. Administration of the Plan.

The Plan shall be administered by the Compensation Committee (the “Committee”) of the Board of Directors of the Company (the “Board”). Subject to the provisions of the Plan, the Committee shall have authority: (a) to determine which employees of the Company and its subsidiaries shall be eligible for participation in the Plan; (b) to select employees to receive grants under the Plan; (c) to determine the form of grant, whether as a stock option, stock appreciation right, restricted stock award, performance award or a combination thereof, the number of shares of Common Stock or units subject to the grant, the time and conditions of exercise or vesting, the fair market value of the Common Stock for purposes of the Plan, and all other terms and conditions of any grant and to amend such awards or accelerate the time of exercise or vesting thereof, subject in each case to the terms and conditions of the Plan; and (d) to prescribe the form of agreement, certificate or other instrument evidencing the grant; provided, however, that without approval of the Company’s shareholders, in no event shall the

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Committee reprice any stock options awarded under the Plan by lowering the option price of a previously granted stock option or by cancellation of outstanding stock options with subsequent replacement or regrant of stock options with lower option prices. Notwithstanding the foregoing, the Committee or the Board, subject to the terms and conditions of the Plan may, by resolution adopted by it, authorize the Chairman of the Board or President of the Company to make grants or awards of stock options, stock appreciation rights, restricted stock or performance awards, not to exceed such number of shares as the Committee or Board shall specify in such resolution, and to have the authority of the Committee with respect to such grants or awards, to such employees of the Company and its subsidiaries who are not subject to section 16(a) of the Exchange Act; provided, however, that no such officer shall be authorized to designate himself for any such grant or award. The Committee shall also have authority to interpret the Plan and to establish, amend and rescind rules and regulations for the administration of the Plan, and all such interpretations, rules and regulations shall be conclusive and binding on all persons.

5. Effective Date of Plan.

The Effective Date of the Plan is May 8, 2002, the date of approval by the stockholders of the Company.

6. Stock Options.

(a) Grants. Subject to the terms of the Plan, options to purchase shares of Common Stock, including “incentive stock options” within the meaning of Section 422 of the Code, may be granted from time to time to such officers and other key employees of the Company and its subsidiaries as may be selected by the Committee. Each grant of an option under the Plan may designate whether the option is intended to be an incentive stock option or a “nonqualified” stock option. Any option not so designated shall be deemed to be a “nonqualified” stock option.

(b) Terms of Options. An option shall be exercisable in whole or in such installments and at such times as may be determined by the Committee in its sole discretion, provided that no option shall be exercisable more than ten years after the date of grant. The per share option price shall not be less than the greater of par value or 100% of the fair market value of a share of Common Stock on the date the option is granted or, if granted pursuant to an offer of employment, the date of such offer or such later date as is specified in such offer. Upon exercise, the option price may be paid in cash, in shares of Common Stock having a fair market value equal to the option price which, except as otherwise specifically provided by the terms of the option, have been owned by the Participant for at least 6 months prior thereto, or in a combination thereof. The Committee may also allow the cashless exercise of options by holders thereof, as permitted under regulations promulgated by the Board of Governors of the Federal Reserve System, subject to any applicable restrictions necessary to comply with rules adopted by the Securities and Exchange Commission, and the exercise of options by holders thereof by any other means that the Committee determines to be consistent with the Plan’s purpose and applicable law, including loans, with or without interest, made by the Company to the holder thereof.

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(c) Restrictions Relating to Incentive Stock Options. To the extent required by the Code, the aggregate fair market value (determined as of the time the option is granted) of the Common Stock with respect to which incentive stock options are exercisable for the first time by an employee during any calendar year (under the Plan or any other plan of the Company or any of its subsidiaries) shall not exceed $100,000.

(d) Termination of Employment. Except as otherwise provided by the terms of the grant (or, for a grant made prior to January 1, 2004, the terms of the Plan as in effect on the date of grant) or as thereafter determined by the Committee, a stock option shall expire as of the date on which the optionee ceases to be employed by the Company and its subsidiaries for any reason.

(e) Additional Terms and Conditions. The agreement or instrument evidencing the grant of a stock option may contain such other terms, provisions and conditions not inconsistent with the Plan as may be determined by the Committee in its sole discretion, including deferred delivery of shares after exercise of the stock option.

7. Stock Appreciation Rights.

(a) Grants. Subject to the terms of the Plan, stock appreciation rights entitling the grantee to receive cash or shares of Common Stock having a fair market value equal to the appreciation in market value of a stated number of shares of such Common Stock from the date of the grant to the date of exercise, or, in the case of rights granted in tandem with or by reference to a stock option granted prior to the grant of such rights, from the date of grant of such related stock option to the date of exercise, may be granted from time to time to such officers and other key employees of the Company and its subsidiaries as may be selected by the Committee.

(b) Terms of Grant. Such rights may be granted in tandem with or by reference to a related stock option, in which event the grantee may elect to exercise either the stock option or the right, but not both, as to the shares subject to the stock option and the right, or the right may be granted independently of a stock option. Rights granted in tandem with or by reference to a related stock option shall, except as provided at the time of grant, be exercisable to the extent, and only to the extent, that the related option is exercisable. Rights granted independently of a stock option shall be exercisable in whole or in such installments and at such times as may be determined by the Committee, provided that no right shall be exercisable more than ten years after the date of grant. Except as otherwise provided by the terms of the grant (or, for a grant made prior to January 1, 2004, the terms of the Plan as in effect on the date of grant), or as thereafter determined by the Committee, a stock appreciation right shall expire as of the date on which the holder ceases to be employed by the Company and its subsidiaries for any reason. The Committee may at the time of the grant or at any time thereafter impose such additional terms and conditions on the exercise of stock appreciation rights as it deems necessary or desirable for any reason, including for compliance with Section 16(a) or Section 16(b) of the Exchange Act and the rules and regulations thereunder.

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(c) Payment on Exercise. Upon exercise of a stock appreciation right, the holder shall be paid the excess of the then fair market value of the number of shares of Common Stock to which the right relates over the fair market value of such number of shares at the date of grant of the right or of the related stock option, as the case may be. Such excess shall be paid in cash or in shares of Common Stock having a fair market value equal to such excess, or in such combination thereof, as may be provided in the grant of such right (which may permit the holder to elect between cash and Common Stock or to elect a combination thereof), or, if no such provision is made in the grant, as the Committee shall determine upon exercise of the right, provided, in any event, that the holder shall be paid cash in lieu of any fractional share of Common Stock to which such holder would otherwise be entitled.

(d) Additional Terms and Conditions. The agreement or instrument evidencing the grant of stock appreciation rights may contain such other terms, provisions and conditions not inconsistent with the Plan as may be determined by the Committee in its sole discretion, including deferral of the gain upon exercise of the rights.

8. Restricted Stock Awards.

Subject to the terms of the Plan, restricted stock awards consisting of shares of Common Stock may be made from time to time to such officers and other key employees of the Company and its subsidiaries as may be selected by the Committee, provided that any such employee (except an employee whose terms of employment include the granting of a restricted stock award) shall have been employed by the Company or any of its subsidiaries for at least six months. Such awards shall be contingent on the employee’s continuing employment with the Company or its subsidiaries for a period to be specified in the award (which shall not be more than ten years from the date of award) and shall be subject to such additional terms and conditions as the Committee in its sole discretion deems appropriate, including, but not by way of limitation, requirements relating to satisfaction of performance measures and restrictions on the sale or other disposition of such shares during the restriction period. Except as otherwise determined by the Committee at the time of the award, the holder of a restricted stock award shall have the right to vote the restricted shares and to receive dividends thereon, unless and until such shares are forfeited. Notwithstanding the foregoing provisions of this Section 8, any restricted stock award which is not subject to satisfaction of performance measures shall be subject to the employee’s continuing employment with the Company or its affiliates for a period of not less than three years from the date of grant and any restricted stock award which is subject to satisfaction of performance measures shall be subject to the employee’s continuing employment with the Company or its affiliates for a period of not less than one year from the date of grant; provided, however, that this sentence shall not apply to the extent the restricted stock awards are approved by the Company’s stockholders or to the extent the restricted stock awards made under the Plan which do not conform to the foregoing provisions of this sentence (when aggregated with any performance awards which do not conform to the provisions of the last sentence of paragraph 9(a)) do not exceed 10 percent of the shares of Common Stock reserved for issuance under the Plan.

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9. Performance Awards.

(a) Awards. Performance awards consisting of (i) shares of Common Stock, (ii) monetary units or (iii) units which are expressed in terms of shares of Common Stock may be made from time to time to such officers and other key employees of the Company and its subsidiaries as may be selected by the Committee. Subject to the provisions of Section 12 below, such awards shall be contingent on the achievement over a period of not more than ten years of such corporate, division, subsidiary, group or other measures and goals as shall be established by the Committee. Subject to the provisions of Sections 10 and 12 below, such measures and goals may be revised by the Committee at any time and/or from time to time during the performance period. Except as may otherwise be determined by the Committee at the time of the award or at any time thereafter, a performance award shall terminate if the grantee of the award does not remain continuously in the employ of the Company or its subsidiaries at all times during the applicable performance period. Notwithstanding the foregoing provisions of this paragraph 9(a) any performance award that consists of Common Stock shall be subject to the employee’s continuing employment with the Company or its affiliates for a period of not less than one year from the date of grant; provided, however, that this sentence shall not apply to the extent the performance awards are approved by the Company’s stockholders or to the extent the performance awards consisting of Common Stock made under the Plan which do not conform to the provisions of this sentence (when aggregated with any restricted stock awards which do not conform to the provisions of the last sentence of Section 8) do not exceed 10 percent of the shares of Common Stock reserved for issuance under the Plan.

(b) Rights with Respect to Shares and Share Units. If a performance award consists of shares of Common Stock or units which are expressed in terms of shares of such Common Stock, amounts equal to dividends otherwise payable on a like number of shares may, if the award so provides, be converted into additional such shares (to the extent that shares are then available for issuance under the Plan) or credited as additional units and paid to the participant if and when, and to the extent that, payment is made pursuant to such award.

(c) Payment. Payment of a performance award following the end of the performance period, if such award consists of monetary units or units expressed in terms of shares of Common Stock, may be made in cash, shares of Common Stock, or a combination thereof, as determined by the Committee, and may be deferred pursuant to such terms and conditions, including with respect to the crediting of earnings, as the Committee may provide. Any payment made in Common Stock shall be based on the fair market value of such stock on the payment date.

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10. Performance Measures Applicable to Awards to Named Executive Officers.

Unless and until the Committee proposes for stockholder vote a change in the general performance measures set forth in this Section 10, the attainment of which may determine the degree of payout or vesting with respect to awards under the Plan which are designed to qualify for the Performance-Based Exception, the performance measure(s) to be used for purposes of such awards shall be chosen from among the following alternatives: safety (including, but not limited to, total injury frequency, lost workday rates or cases, medical treatment cases and fatalities); quality control (including, but not limited to, critical product characteristics and defects); cost control (including, but not limited to, cost as a percentage of sales); capital structure (including, but not limited to, debt and equity levels, debt-to-equity ratios, and debt-to total-capitalization ratios); inventory turnover; revenue growth; revenue growth compared to market; market share; customer performance or satisfaction; revenue measures (including, but not limited to gross revenues and revenue growth); net income; conformity to cash flow plans; return measures (including, but not limited to, return on investment assets or capital); operating profit to operating assets; share price measures (including, but not limited to, fair market value of shares, growth measures, and total shareholder return); working capital measures; operating earnings (before or after taxes); economic value added; cash value added; and cash flow return on investment.

The Committee shall have the discretion to establish performance goals based upon the foregoing performance measures and to adjust such goals and the methodology used to measure the determination of the degree of attainment of such goals; provided, however, that awards under the Plan that are intended to qualify for the Performance-Based Exception and that are issued to or held by Named Executive Officers may not be adjusted in a manner that increases such award. The Committee shall retain the discretion to adjust such awards in a manner that does not increase such awards. Furthermore, the Committee shall not make any adjustment to awards under the Plan issued to or held by Named Executive Officers that are intended to comply with the Performance-Based Exception if the result of such adjustment would be the disqualification of such award under the Performance-Based Exception.

In the event that applicable laws change to permit the Committee greater discretion to amend or replace the foregoing performance measures applicable to awards to Named Executive Officers without obtaining stockholder approval of such changes, the Committee shall have sole discretion to make such changes without obtaining such approval. In addition, in the event that the Committee determines that it is advisable to grant awards under the Plan to Named Executive Officers that may not qualify for the Performance-Based Exception, the Committee may make such grants upon any performance measures it deems appropriate with the understanding that they may not satisfy the requirements of Section 162(m) of the Code.

11. Adjustments for Changes in Capitalization, etc.

Subject to the provisions of Section 12 herein, in the event of any change in corporate capitalization, such as a stock split, reverse stock split, stock dividend, or a corporate transaction, such as a merger, consolidation, or separation, including a spin-off, or other distribution of stock or property of the Company or its subsidiaries (other than normal cash dividends), any reorganization (whether or not such reorganization comes within the definition of such term in

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Code Section 368) or any partial or complete liquidation of the Company or its subsidiaries, such adjustment shall be made in the number and class of shares which may be delivered under Section 3 (including the number of shares referred to in the last sentence of the first paragraph of Section 3 and in subparagraph (a) of the second paragraph of Section 3), and in the number and class of and/or price of shares subject to outstanding grants or awards under the Plan, as may be determined to be appropriate and equitable by the Committee, in its sole discretion, to prevent dilution or enlargement of rights; provided, however, that the number of shares subject to any grants or awards under the Plan shall always be a whole number.

12. Effect of Change in Control.

(a) Acceleration of Benefits. Subject to the following sentence and the terms of any agreement evidencing the terms of any award under the Plan, in the event of a “Change in Control” as defined in paragraph (b) of this Section 12, (i) at the election of the holder filed in such form and in such manner and time as the Committee shall provide, the value of all outstanding stock options, stock appreciation rights and restricted stock awards (whether or not then fully exercisable or vested) shall be cashed out on the basis of the “Change in Control Price” (as defined in paragraph (c) of this Section 12) as of the date the Change in Control occurs, provided, however, that the Committee may provide for the immediate vesting instead of the cashing out of restricted stock awards in such circumstances as it deems appropriate; and (ii) all outstanding performance awards shall be cashed out in such manner and in such amount or amounts as determined by the Committee in its sole discretion.

(b) Change in Control. For purposes of this Section 12, a Change in Control means the happening of any of the following:

(i) any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act), other than (w) the Company, (x) a trustee or other fiduciary holding securities under an employee benefit plan of the Company, (y) an underwriter temporarily holding securities pursuant to an offering of such securities, or (z) a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of voting securities of the Company, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such person any securities acquired directly from the Company or its affiliates) representing 20% or more of the combined voting power of the Company’s then outstanding securities;

(ii) during any period of two consecutive years, individuals who at the beginning of such period constitute the Board and any new director (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in clauses (i), (iii) or (iv) of this paragraph (b)) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the

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period or whose election or nomination for election was previously so approved cease for any reason to constitute a majority thereof;

(iii) there occurs a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity), in combination with the ownership of any trustee or other fiduciary holding securities under an employee benefit plan of the Company, at least 60% of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation, or a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no person acquires more than 50% of the combined voting power of the Company’s then outstanding securities; or

(iv) the stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.

A Change in Control shall also be deemed to occur with respect to any Participant for purposes of the Plan if there occurs:

(1) a sale or disposition, directly or indirectly, other than to a person described in subclause (w), (x) or (z) of clause (i) next above, of securities of the Participant’s employer, any direct or indirect parent company of the Participant’s employer or any company that is a subsidiary of the Participant’s employer and is also a significant subsidiary (as defined below) of the Company (the Participant’s employer and such a parent or subsidiary being a “Related Company”), representing 50% or more of the combined voting power of the securities of such Related Company then outstanding;

(2) a merger or consolidation of a Related Company with any other corporation, other than a merger or consolidation which would result in 50% or more of the combined voting power of the surviving company being beneficially owned by a majority owned direct or indirect subsidiary of the Company; or

(3) the sale or disposition of all or substantially all the assets of a Related Company to a person other than a majority owned direct or indirect subsidiary of the Company.

For purposes of the Plan, the term “significant subsidiary” has the meaning given to such term under Rule 405 of the Securities Act of 1933, as amended. Notwithstanding the foregoing, no Change in Control shall be deemed to have occurred with respect to a Participant for purposes of the Plan if (I) such transaction includes or involves a sale to the public or a distribution to the stockholders of the Company of more than 50% of the voting securities of the Participant’s employer or a direct or indirect parent of the Participant’s employer, and (II) the Participant’s employer or a direct or indirect parent of the Participant’s employer agrees to become a

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successor to the Company under an individual agreement between the Company and the Participant or the Participant is covered by an agreement providing for benefits upon a change in control of his or her employer following an event described clauses (1), (2) or (3) next above.

(c) Change in Control Price. For purposes of this Section 12, Change in Control Price means:

(i) with respect to a Change in Control by reason of a merger or consolidation of the Company described in paragraph (b)(iii) of this Section 12 in which the consideration per share of Common Stock to be paid for the acquisition of shares of Common Stock specified in the agreement of merger or consolidation is all in cash, the highest such consideration per share;

(ii) with respect to a Change in Control by reason of an acquisition of securities described in paragraph (b)(i) of this Section 12, the highest price per share for any share of the Common Stock paid by any holder of any of the securities representing 20% or more of the combined voting power of the Company giving rise to the Change in Control; and

(iii) with respect to a Change in Control by reason of a merger or consolidation of the Company (other than a merger or consolidation described in paragraph (b)(iii) of this Section) or a change in the composition of the Board of Directors described in paragraph (b)(ii) of this Section 12, or stockholder approval of an agreement or plan described in paragraph (b)(iv) of this Section 12, the highest price per share of Common Stock reported on the New York Stock Exchange Composite Transactions (or, if such shares are not traded on the New York Stock Exchange, such other principal market on which such shares are traded) during the sixty-day period ending on the date the Change in Control occurs, except that, in the case of incentive stock options and stock appreciation rights relating to incentive stock options, the holder may not receive an amount in excess of the maximum amount that will enable such option to continue to qualify as an incentive stock option.

13. Amendment and Termination of Plan.

The Plan may be amended or terminated by the Board at any time and in any respect, provided that, without the approval of the Company’s stockholders, no such amendment shall be made for which stockholder approval is necessary to comply with any applicable tax or regulatory requirement, and provided that no such amendment or termination shall impair the rights of any participant, without his or her consent, in any award previously granted under the Plan, unless required by law. In the event of termination of the Plan, no further grants may be made under the Plan but termination shall not affect the rights of any participant under, or the authority of the Committee with respect to, any grants or awards made prior to termination. Notwithstanding any other provision of the Plan, without the approval of the Company’s stockholders, the Board shall not adopt any amendment to the Plan which makes changes to the Plan that are so material that the focus of the Plan is changed, including amending the Plan to

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provide for a form of grant not presently available under the Plan, as determined in the reasonable judgment of the Board.

14. Prior Plans.

Upon the effectiveness of this Plan, no further grants shall be made under the Prior Plans. The discontinuance of the Prior Plans shall not affect the rights of any participant under, or the authority of the Committee (therein referred to) with respect to, any grants or awards made thereunder prior to such discontinuance.

15. Miscellaneous.

(a) No Right to a Grant. Neither the adoption of the Plan nor any action of the Board or of the Committee shall be deemed to give any employee any right to be selected as a participant or to be granted a stock option, stock appreciation right, restricted stock award or performance award.

(b) Rights as Stockholders. No person shall have any rights as a stockholder of the Company with respect to any shares covered by a stock option, stock appreciation right, or performance award until the date of the issuance of a stock certificate to such person pursuant to such stock option, right or award.

(c) Employment. Nothing contained in this Plan shall be deemed to confer upon any employee any right of continued employment with the Company or any of its subsidiaries or to limit or diminish in any way the right of the Company or any such affiliate to terminate his or her employment at any time with or without cause.

(d) Taxes. The Company shall be entitled to deduct from any payment under the Plan the amount of any tax required by law to be withheld with respect to such payment or may require any participant to pay such amount to the Company prior to and as a condition of making such payment. In addition, the Committee may, in its discretion and subject to such rules as it may adopt from time to time, permit a participant to elect to have the Company withhold from any payment under the Plan (or to have the Company accept from the participant), for tax withholding purposes, shares of Common Stock, valued at their fair market value, but in no event shall the fair market value of the number of shares so withheld (or accepted) exceed the amount necessary to meet the required Federal, state and local withholding tax rates then in effect that are applicable to the participant and to the particular transaction.

(e) Nontransferability. Except as permitted by the Committee, no stock option, stock appreciation right, restricted stock award or performance award shall be transferable except by will or the laws of descent and distribution, and, during the holder’s lifetime, stock options and stock appreciation rights shall be exercisable only by, and shares subject to restricted stock awards and payments pursuant to performance awards shall be delivered or made only to, such holder or such holder’s duly appointed legal representative.

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EX-10.8

EXHIBIT 10.8

RYERSON TULL

NONQUALIFIED SAVINGS PLAN

(As amended and restated as of January 31, 2004)

Ryerson Tull, Inc. established the Ryerson Tull Nonqualified Savings Plan (the “Plan”), effective as of January 1, 1998, in order to continue to enable employees of the Company and the other Employers to obtain the same level of benefits they would have been able to receive under the Ryerson Tull Savings Plan but for the limits imposed by certain provisions of the Internal Revenue Code of 1986, as amended, on the amounts that can be contributed to the Savings Plan. The following provisions constitute an amendment, restatement and continuation of the Plan as previously amended from time to time and as in effect immediately prior to January 31, 2003, the “Effective Date” of the Plan as set forth herein. The Plan is intended to be an “excess benefit plan” described in Section 3(36) of the Employee Retirement Income Security Act of 1974, as amended; provided, however, that, to the extent, if any, that the Plan provides benefits which cannot be provided by an excess benefit plan, the Plan shall constitute an unfunded plan maintained primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees.

ARTICLE I

DEFINITIONS

1.01 “Account” means the record of a Participant’s interest in the Plan attributable to Company Contributions and Participant Contributions made on behalf of such Participant.

1.02 “Base Compensation” means Base Compensation as defined in the Savings Plan but without regard to the limitations under Code Section 401(a)(17) and prior to any Participant Deferrals under this Plan.

1.03 “Beneficiary” means, with respect to a Participant, the Participant’s Beneficiary under the Savings Plan.

1.04 “Board” means the Board of Directors of the Company.

1.05 “Code” means the Internal Revenue Code of 1986, as from time to time amended.

1.06 “Company” means Ryerson Tull, Inc.

1.07 “Distributable Event” means a Distributable Event as defined in the Savings Plan.

1.08 “Effective Date” means January 31, 2004.

1.09 “Eligible Employee” means an employee of an Employer who is eligible to participate in the Savings Plan, who has elected to make the maximum Before Tax Contribution permitted under the Savings Plan, and whose contributions under the Savings Plan are limited by

Section 415 or Section 402(g) of the Code or whose Base Compensation exceeds the limits set forth in Section 401(a)(17) of the Code.

1.10 “Employer” means an Employer as defined in the Savings Plan.

1.11 “Employer Credits” means the amount credited to the Plan by the Employers pursuant to Section 3.03.

1.12 “Enrollment Date” means the Effective Date and the first day of each month thereafter.

1.13 “ERISA” means the Employee Retirement Income Security Act of 1974, as from time to time amended.

1.14 “Fair Market Value” means with respect to Company common stock as of any date the average of the high and low prices of a share of the Company’s common stock as reported on the New York Stock Exchange Composite Transactions for such date or, if there are no reported trades for such date, for the last previous date for which trades were reported

1.15 “Participant” means each Eligible Employee who has met the requirements of Article II for participation in the Plan.

1.16 “Participant Deferrals” means amounts deferred pursuant to Participant elections under Section 3.01.

1.17 “Permanent Incapacity” means Permanent Incapacity as defined in the Savings Plan.

1.18 “Plan” means the Ryerson Tull Inc. Nonqualified Savings Plan, as from time to time amended.

1.19 “Plan Administrator” means the Plan Administrator appointed under the Savings Plan or any other individual as may be appointed by the Chairman of the Board, the President, the Vice President-Human Resources or the Treasurer of the Company to administer the Plan. To the extent consistent with the purposes of the Plan and the authority delegated to the Assistant Plan Administrator pursuant to Section 6.03(h), the term Plan Administrator shall include the Assistant Plan Administrator.

1.20 “Plan Year” means the calendar year.

1.21 “Related Company” means a Related Company as defined in the Savings Plan.

1.22 “Retirement” means Retirement as defined in the Savings Plan.

1.23 “Savings Plan” means the Ryerson Tull Savings Plan, as from time to time amended.

1.24 “Valuation Date” means the last day of each month.

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1.25 “Years of Vesting Service” means Years of Vesting Service as defined in the Savings Plan.

ARTICLE II

PARTICIPATION

2.01 Eligibility. An Eligible Employee shall become a Participant on the Enrollment Date next following the filing with the Plan Administrator of an instrument in a form prescribed by the Plan Administrator evidencing his or her acceptance of the provisions of the Plan.

2.02 Restricted Participation. Notwithstanding any other provision of the Plan to the contrary, if the Plan Administrator determines that participation by one or more Participants or Beneficiaries shall cause the Plan as applied to any Employer to be subject to Part 2, 3 or 4 of Title I of ERISA, the entire interest of such Participant or Beneficiary under the Plan shall, in the discretion of the Plan Administrator, be immediately paid to such Participant or Beneficiary, as applicable, by the applicable Employer or Employers, or shall otherwise be segregated from the Plan, and such Participant(s) or Beneficiary(ies) shall cease to have any interest under the Plan.

ARTICLE III

DEFERRAL OF COMPENSATION AND

EXCESS SAVINGS PLAN CREDITS

3.01 Participant Deferrals. For any payroll period, each Participant who is an Eligible Employee for such payroll period may elect, at such time and in such manner as the Plan Administrator may determine, to make a supplemental deferral of Base Compensation under the Plan (“Participant Deferrals”) equal to the amount by which the Participant’s Before Tax contributions are limited under the Savings Plan by reason of Code Sections 402(g) and 415 and may also elect to make supplemental deferrals of not less than one percent (1%) and not more than ten percent (10%) of the portion of the Participant’s Base Compensation for any year which is not taken into account under the Savings Plan by reason of the limitation under Code Section 401(a)(17). Contributions made to the Plan on a Participant’s behalf for any payroll period shall be treated as a salary reduction and shall reduce the amount of current cash compensation otherwise payable to such Participant for such payroll period.

3.02 Designation of Participant Deferrals. Each Participant shall designate the percentage of his or her Base Compensation to be deferred under the Plan in the same instrument by which he or she evidences his or her acceptance of the provisions of the Plan pursuant to Article II. Thereafter (but not retroactively), a Participant may, on a form prescribed by the Plan Administrator, change the percentage of his or her Base Compensation to be deferred under the Plan, subject to the limitations of this Article III.

3.03 Employer Credits. For each payroll period, each Participant who is employed by an Employer as of the last day of the payroll period shall receive a credit under the Plan (an “Employer Credit”) in an amount determined in accordance with procedures established from

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time to time by the Plan Administrator which is equal to the amount by which the Matching Contributions under the Savings Plan on behalf of the Participant for such payroll period are limited by reason of limitations on Participant Before Tax Contributions and Company Contributions imposed by Code Sections 401(a)(17), 402(g) and 415.

3.04 Nature of Participant Deferrals and Employer Credits. Any amounts deferred by Participants or credited to Participants pursuant to this Article III shall be retained by the Employers as general assets of the Employers, and shall be reflected on the books of the Employers solely for the purpose of computing Participants’ benefits from the Plan.

ARTICLE IV

ACCOUNTS

4.01 Maintenance of Accounts. The Plan Administrator shall establish and maintain in the records of the Plan an Account for each Participant reflecting each Participant’s interest in the Plan attributable to Participant Deferrals and Employer Credits made on his or her behalf, increased by earnings attributable thereto. Each Participant shall at all times be fully vested in the portion of the Participant’s Account which is attributable to Participant Deferrals.

4.02 Valuation of Accounts. As of each Valuation Date, and as of such other date as the Plan Administrator may determine, the Account of each Participant shall be (a) adjusted for earnings or losses for the period since the next preceding Valuation Date as set forth in Section 4.03, (b) increased by Participant Deferrals and Employer Credits under the Plan with respect to such Participant relating to payroll periods since the next preceding Valuation Date, and (c) charged with any distribution calculated as of that date under Article V.

4.03 Earnings and Losses. Except as provided in the following sentence, each Participant’s Account shall be credited with interest in accordance with paragraph (a) below. On and after the Effective Date, each Participant may elect to have all or any portion of his Account converted to Stock Units in accordance with paragraph (b) below. Each such election by a Participant shall be made at such times and in such form and otherwise in accordance with such rules and procedures as the Plan Administrator shall establish from time to time, including such rules and procedures as may be established by the Plan Administrator for compliance with Section 16 of the Securities Exchange Act of 1934 (the “Exchange Act”). A Participant may elect to change any election made under this Section 4.03 to the extent permitted by and in accordance with such rules and procedures as the Plan Administrator may establish from time to time.

(a) To the extent that a Participant’s Account is to be credited with interest, it shall at a rate of interest earned by assets in the Managed Income Portfolio Fund II, or any successor fund, established under the Savings Plan.

(b) To the extent that any portion of a Participant’s Account is to be credited as Stock Units as of any date in accordance with the provisions of this Section 4.03, the number of Stock Units credited to the Participant’s Account shall be determined by dividing such amount by the Fair Market Value of a share of the Company’s common

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stock on that date. As of each cash dividend payment date for the Company’s common stock, each Participant shall be credited with an additional number of Stock Units which is equal to (i) the dividend which would have been paid on such date on that number of shares of Company common stock which is equal to the number of Stock Units credited to the Participant under the Plan on the record date for such dividend, divided by (ii) the Fair Market Value of a share of the Company’s common stock on the dividend payment date. In the event of any changes in outstanding shares of the Company’s common stock by reason of any stock dividend or split, other non-cash dividend recapitalization, merger, consolidation, spin-off, combination or exchange of shares or other similar corporate change, the Company’s Board of Directors shall make such adjustments, if any, that it deems appropriate in the number of Stock Units then credited to Participant Accounts. Any and all such adjustments shall be conclusive and binding upon all parties concerned.

ARTICLE V

DISTRIBUTION OF BENEFITS

5.01 Distribution Upon Termination of Employment.

(a) All distributions under the Plan will be made in cash. Distributions with respect to any portion of a Participant’s Account which is denominated in Stock Units shall be based upon the Fair Market Value of a share of the Company’s common stock on the day as of which the distribution is made.

(b) Upon termination of a Participant’s employment with the Employers and Related Companies other than by reason of a Distributable Event and prior to (i) the completion of three Years of Vesting Service and (ii) the date on which he or she has a fully vested and nonforfeitable interest in his or her account balance under the Savings Plan, the Participant shall be entitled to a distribution of the portion of his or her Account balance attributable to Participant Deferrals in a single lump sum payment as of a Valuation Date selected by the Plan Administrator which is no later than 60 days after the first anniversary of the Participant’s termination of employment.

(c) Upon termination of a Participant’s employment with the Employers and Related Companies by reason of a Distributable Event on or after (i) the completion of three Years of Vesting Service, or (ii) the date on which he or she has a fully vested and nonforfeitable interest in his or her account balance under the Savings Plan, the Participant shall be entitled to a distribution of his or her entire Account balance in a single lump sum payment as of a Valuation Date selected by the Plan Administrator which is no later than 60 days after the first anniversary of the Participant’s termination of employment.

(d) Upon termination of a Participant’s employment with the Employers and Related Companies by reason of Permanent Incapacity or Retirement, and where the amount payable to the Participant is at least $10,000, the Participant shall be entitled to a distribution of his or her entire Account balance, payable to the Participant in either of the

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following ways, as irrevocably elected by the Participant in accordance with rules established from time to time, by the Plan Administrator:

(1) in a single lump sum payment representing the full amount distributable to the Participant, payable on a date elected by the Participant which is not later than the end of the calendar year in which the Participant attains age 75, and, except as otherwise agreed to by the Plan Administrator in his or her sole discretion, not earlier than the first Valuation Date following the year in which such termination of employment occurs; or

(2) in substantially equal installments, payable annually, over a period not extending beyond the end of the calendar year in which the Participant attains age 75, with each installment payment being equal to that amount determined by multiplying the then remaining balance in the Participant’s Account as of the Valuation Date used for purposes of calculating the payment by a fraction having a numerator of one and a denominator equal to the number of installments remaining to be paid.

5.02 Distribution Upon Death. Upon the death of a Participant, the total value of the Participant’s Account as of the Valuation Date immediately following the date of death shall be distributed thereafter to the Participant’s Beneficiary in a single lump sum payment as soon as practicable after satisfactory proof of death shall have been submitted to the Plan Administrator.

5.03 Hardship Distributions. Upon a showing of hardship by a Participant, such Participant shall be entitled to a distribution of such portion (or all) of his or her Account balance as shall be necessary to meet such hardship. This Section 5.03 shall be administered in a manner consistent with the hardship withdrawal provisions of the Savings Plan. The Plan Administrator’s determination of a Participant’s hardship hereunder shall be final.

5.04 Liability for Benefit Payments. The amount of any benefit payable under the Plan shall be paid from the general revenues of the Employer that last employs the Participant. An Employer’s obligation under the Plan shall be reduced to the extent that any amounts due under the Plan are paid from one or more trusts, the assets of which are subject to the claims of general creditors of the Employer or any affiliate thereof; provided, however, that nothing in the Plan shall require the Company or any Employer to establish any trust to provide benefits under the Plan.

ARTICLE VI

PLAN ADMINISTRATION

6.01 Administration of Plan. The Employers shall have the sole responsibility for effecting Participant Deferrals in accordance with Article III and paying Plan benefits in accordance with Article V, and the Company shall have the sole authority to amend or terminate, in whole or in part, this Plan at any time. The Plan Administrator shall have the sole responsibility for the administration of the Plan. The Employers do not guarantee to any

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Participant in any manner the effect under any tax law or Federal or state statute of the Participant’s participation in this Plan.

6.02 Claims Procedure. All claims for benefits under the Plan shall be made in accordance with Article IX.

6.03 Powers and Duties of Plan Administrator. The Plan Administrator shall have such duties and powers as may be necessary to discharge his or her duties hereunder, including, but not by way of limitation, the following:

(a) to conclusively construe and interpret the Plan, decide all questions of eligibility and determine the amount, manner and time of payment of any benefits hereunder;

(b) to prescribe procedures to be followed by Participants in filing elections or revocations thereof;

(c) to prepare and distribute, in such manner as the Plan Administrator determines to be appropriate, information explaining the Plan;

(d) to receive from the Employers and from Participants such information as shall be necessary for the proper administration of the Plan;

(e) to furnish the Employers, upon request, such reports with respect to the administration of the Plan as are reasonable and appropriate;

(f) to receive, review and keep on file (as it deems convenient and proper) reports of benefit payments by the Employers and reports of disbursements for expenses directed by the Plan Administrator;

(g) to appoint individuals to assist in the administration of the Plan and any other agents it deems advisable, including legal counsel; and

(h) to name as an Assistant Plan Administrator any individual or individuals and to delegate such authority and duties to such individual as the Plan Administrator in his or her discretion deems advisable. Each Assistant Plan Administrator, if any, named pursuant to this paragraph shall have such authority to act with respect to the administration of the Plan as the Plan Administrator may prescribe. The incumbency of any Assistant Plan Administrator may be terminated by action of the Plan Administrator at any time, with or without cause. Notwithstanding the foregoing, in the absence of a formal designation of any Assistant Plan Administrator by the Plan Administrator, no provision of this paragraph shall prevent the Plan Administrator from delegating authority to employees or other agents of the Employers in executing the duties of administering the Plan.

The Plan Administrator shall have no power to add to, subtract from or modify any of the terms of the Plan, or to change or add to any benefits provided by the Plan, or to waive or fail to apply any requirements of eligibility for a benefit under the Plan.

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6.04 Rules and Decisions. The Plan Administrator may adopt such rules as he or she deems necessary, desirable or appropriate. All rules and decisions of the Plan Administrator shall be uniformly and consistently applied to all Participants in similar circumstances. When making a determination or calculation, the Plan Administrator shall be entitled to rely upon information furnished by a Participant, the Employers or the legal counsel of the Employers.

6.05 Authorization of Benefit Payments. The Plan Administrator shall issue directions to the Employers concerning all benefits which are to be paid from the Company’s general assets pursuant to the provisions of the Plan.

6.06 Indemnification of Plan Administrator. The Plan Administrator and any Assistant Plan Administrator and any officer or director of any Employer shall be indemnified by the Employers against any and all liabilities arising by reason of any act or failure to act made in good faith pursuant to the provisions of the Plan, including expenses reasonably incurred in the defense of any claim relating thereto.

ARTICLE VII

MISCELLANEOUS

7.01 No Right to Employment, etc. Neither the creation of this Plan nor anything contained herein shall be construed as giving any Participant hereunder or other employees of the Employers or any Related Company any right to remain in the employ of the Employers or any Related Company.

7.02 Successors and Assigns. All rights and obligations of this Plan shall inure to, and be binding upon, the successors and assigns of the Employers.

7.03 Inalienability. Except so far as may be contrary to the laws of any state having jurisdiction in the premises, a Participant or Beneficiary shall have no right to assign, transfer, hypothecate, encumber, commute or anticipate his or her interest in any payments under this Plan and such payments shall not in any way be subject to any legal process to levy upon or attach the same for payment of any claim against any Participant or Beneficiary.

7.04 Incompetency. If any Participant or Beneficiary is, in the opinion of the Plan Administrator, legally incapable of giving a valid receipt and discharge for any payment, the Plan Administrator may, at its option, direct that such payment or any part thereof be made to such person or persons who in the opinion of the Plan Administrator are caring for and supporting such Participant or Beneficiary, unless it has received due notice of claim from a duly appointed guardian or conservator of the estate of the Participant or Beneficiary. A payment so made will be a complete discharge of the obligations under this Plan to the extent of and as to that payment, and neither the Plan Administrator nor the Employers will have any obligation regarding the application of payment.

7.05 Controlling Law. To the extent not preempted by the laws of the United States of America, the laws of the State of Illinois shall be the controlling state law in all matters relating to this Plan.

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7.06 Severability. If any provisions of this Plan shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of this Plan, but this Plan shall be construed and enforced as if the illegal and invalid provisions never had been included herein.

7.07 Limitations on Provisions. The provisions of this Plan and any benefits hereunder shall be limited as described herein. Any benefit payable under the Savings Plan shall be paid solely in accordance with the terms and provisions of the Savings Plan, as appropriate, and nothing in this Plan shall operate or be construed in any way to modify, amend, or affect the terms and provisions of the Savings Plan.

7.08 Gender and Number. Whenever the context requires or permits, the gender and number of words shall be interchangeable.

ARTICLE VIII

AMENDMENT AND TERMINATION

8.01 Amendment to Conform with Law. The Plan may be amended to take effect retroactively or otherwise, as deemed necessary or advisable for the purpose of conforming the Plan to any present or future law relating to plans of this or a similar nature, and to the administrative regulations and rulings promulgated thereunder.

8.02 Other Amendments and Termination. The Plan may be amended at any time, without the consent of any Participant or Beneficiary. Notwithstanding the foregoing, the Plan shall not be amended or terminated so as to reduce or cancel the benefits which have accrued to a Participant or Beneficiary prior to the later of the date of adoption of the amendment or termination or the effective date thereof, and in the event of such amendment or termination, any such accrued benefit hereunder shall not be reduced or canceled.

8.03 Effect of Change in Control.

(a) In the event of a Change in Control (as defined below), all benefits accrued as of the date of such Change in Control hereunder shall become fully (i.e., 100%) and irrevocably vested, and shall become distributable to Participants (and Beneficiaries) at such time and in such manner provided herein pursuant to the provisions of the Plan as in effect on the day immediately preceding the date of such Change in Control. The Plan Administrator shall, in his or her sole discretion, determine whether assets equal in value to the aggregate of all accrued benefits under the Plan as of the date of such Change in Control shall be deposited by the Employers with a bank trustee pursuant to one or more “rabbi trusts.”

(b) For purposes of this Section 8.03, a “Change in Control” means the happening of any of the following:

(1) any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act), other than (w) the Company and its affiliates (collectively

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referred to herein as “RTI”), (x) a trustee or other fiduciary holding securities under an employee benefit plan of RTI, (y) an underwriter temporarily holding securities pursuant to an offering of such securities, or (z) a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such person any securities acquired directly from the Company or its affiliates) representing 20% or more of the combined voting power of the Company’s then outstanding securities;

(2) during any period of two consecutive years, individuals who at the beginning of such period constitute the Board and any new director (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in clauses (1), (3) or (4) of this paragraph) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof;

(3) there occurs a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity), in combination with the ownership of any trustee or other fiduciary holding securities under an employee benefit plan of RTI, at least 60% of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation, or a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no person acquires more than 50% of the combined voting power of the Company’s then outstanding securities; or

(4) the stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.

A Change in Control shall also be deemed to occur with respect to any Participant for purposes of the Plan if there occurs:

(I) a sale or disposition, directly or indirectly, other than to a person described in subclause (w), (x) or (z) of clause (b) (1) above, of securities of the Participant’s employer, any direct or indirect parent company of the Participant’s employer or any company that is a subsidiary of the Participant’s employer and is also a significant subsidiary (as defined below) of the Company (the Participant’s employer and such a parent or subsidiary being an “Affiliated Company”),

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representing 50% or more of the combined voting power of the securities of such Affiliated Company then outstanding;

(II) a merger or consolidation of an Affiliated Company with any other corporation, other than a merger or consolidation which would result in 50% or more of the combined voting power of the surviving company being beneficially owned by the Company or by majority owned direct or indirect subsidiary of the Company; or

(III) the sale or disposition of all or substantially all the assets of an Affiliated Company to a person other than the Company or a majority owned direct or indirect subsidiary of the Company.

(c) The provisions of this Section 8.03 may not be amended after the date of a Change in Control without the written consent of a majority in both number and interest of the Participants in this Plan, other than those Participants who are both (i) not employed by the Company or a subsidiary as of the date of the Change in Control, and (ii) not receiving nor could have commenced receiving benefits under the Plan as of the date of the Change in Control, both immediately prior to the Change in Control and at the date of such amendment.

8.04 Manner and Form of Amendment or Termination. Any amendment or termination of this Plan shall be made by action of the Board; provided, however, that the Vice President-Human Resources of the Company and the Treasurer of the Company (or such other person as designated by the Chairman of the Board) are jointly authorized, by written action signed by both such individuals:

(a) to adopt and place in effect such amendments to the Plan and any related documents as they jointly deem necessary or advisable;

(b) to maintain the Plan and any related documents in compliance with applicable law;

(c) to relieve administrative burdens with respect to those documents; or

(d) to provide for other changes in the best interests of Plan Participants and Beneficiaries without the necessity for further action by the Board or subsequent ratification; provided, however, that any action or amendment that would have the effect of:

(1) terminating the Plan;

(2) materially changing the benefits under the Plan; or

(3) increasing anticipated costs associated with the Plan by more than $5 million, except for changes to comply with applicable law;

may not be made without approval or ratification by the Board.

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8.05 Notice of Amendment or Termination. The Plan Administrator shall notify Participants or Beneficiaries who are affected by any amendment or termination of this Plan within a reasonable time thereof.

ARTICLE IX

CLAIMS PROCEDURES

9.01 Filing a Claim. Any Participant or Beneficiary of a deceased Participant (such Participant or Beneficiary being referred to below as a “Claimant”) may deliver to the Plan Administrator a written claim for a determination with respect to the amounts distributable to such Claimant from the Plan. If such a claim relates to the contents of a notice received by the Claimant, the claim must be made within 60 days after such notice was received by the Claimant. All other claims must be made within 180 days of the date on which the event that caused the claim to arise occurred. The claim must state with particularity the determination desired by the Claimant.

9.02 Plan Administrator’s Decision. Within 90 days after the receipt of the claim, the Plan Administrator will provide the Claimant with written notice of his or her decision on the claim. If, because of special circumstances, the Plan Administrator cannot render a decision on the claim within the 90-day period, the Plan Administrator may extend the period in which to render the decision up to 180 days after receipt of the written claim. The Plan Administrator will provide the Claimant with a written notice of the extension, before the end of the initial 90-day period, which indicates the special circumstances requiring the extension and the expected decision date. If the claim is denied in whole or in part, the written notice of the decision will inform the Claimant of:

(a) the specific reasons for the denial;

(b) the specific provisions of the Plan upon which the denial is based;

(c) any additional material or information necessary to perfect the claim and reasons why such material or information is necessary;

(d) the right to request review of the denial and how to request such review; and

(e) a statement of Claimant’s right to bring a civil action under section 502(a) of the Employee Retirement Income Security Act of 1974 (ERISA) following an adverse benefit determination on review.

9.03 Request for Review of Denied Claim. Within 60 days after the receipt of written notice of a denial of all or a portion of a claim, the Claimant may request a review of the denial in a writing filed with the Plan Administrator. Written comments, documents, records and other information may be submitted to the Plan Administrator along with the review request. During the 60-day period following notice of the denial, the Claimant will be provided, upon request and

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free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claim for benefits.

9.04 Review of Denied Claim. Upon receipt of a request for review of a claim denial, the Plan Administrator will undertake a full and fair review of the claim denial and provide the Claimant with written notice of his or her decision within 60 days after receipt of the review request. If, because of special circumstances, the Plan Administrator cannot make a decision within the 60-day period, the Plan Administrator may extend the period in which to make the decision up to 120 days after receipt of the review request. The Plan Administrator will provide the Claimant with a written notice of the extension, before the end of the 60-day period, which indicates the special circumstances requiring the extension and the expected decision date. The written notice of the Plan Administrator’s decision will inform the Claimant of:

(a) the specific reasons for the decision;

(b) the specific provisions of the Plan upon which the decision is based;

(c) a statement that Claimant will be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claim for benefits;

(d) a statement of the Claimant’s right to bring a civil action under section 502(a) of ERISA.

9.05 Legal Action. Except as may be otherwise required by law, the decision of the Plan Administrator on review of the claim denial will be binding on all parties. A Claimant’s compliance with the foregoing provisions of this Article IX is a mandatory prerequisite to a Claimant’s right to commence any legal action with respect to any claim for benefits under this Plan.

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EX-10.9

EXHIBIT 10.9

[GRAPHIC]

Blanket Accident Insurance

Declarations
	Chubb Group of Insurance Companies 15 Mountain View Road Warren, NJ 07059
Policyholder’s Name and Mailing Address
	Policy Number     6404-48-82
RYERSON TULL, INC. 2621 WEST 15TH PLACE CHICAGO, IL 60608	Effective Date     JANUARY 1, 2004
ProducerNo    0030794	Issued by the stock insurance company indicated below. FEDERAL INSURANCE COMPANY Incorporated under the laws of INDIANA
Producer      AON CONSULTING, INC 200 E RANDOLPH ST 13TH F CHICAGO, IL 60601-0000

Section I - Policy Period

From: JANUARY 1, 2004             To: JANUARY 1, 2005

12:01 A.M. standard time at the Policyholder’s mailing address shown above.

Section II - Persons Insured

The following are the Persons Insured under this policy:

Class	Description
1	ALL NON-EMPLOYEE DIRECTORS AND OFFICERS (ON FILE WITH THE HOLDER) OF THE POLICYHOLDER.

If an Insured Person is included in more than one Class, the Insured Person will be covered for only the Benefit Amount applicable to one Class. The Insured Person will be considered a member of the applicable Class that provides the Insured Person the largest Benefit Amount for the particular Accident and Loss that has occurred.

An Insured Person is added for coverage as a Class member at any time during the policy period that the Insured Person fits the Class description. An Insured Person will be deleted from a Class and coverage ends at any time the Insured Person no longer fits the Class description. All premium adjustments will be made according to the terms of this policy.

Section III - Hazards

The following are the Hazards during which coverage applies:

Hazards	Form Number
BUSINESS TRAVEL	44-02-0897 (01/95)

	continued
Form 44-02-0893(Ed. 1-95)                        Declarations	Page 01

(continued)

Section IV - Benefits

BENEFIT AMOUNTS

Accidental Loss of Life and Scheduled Benefits

The following are Loss of Life Benefit Amounts for each Class and corresponding Hazards:

Class	Benefit Amounts
		BUSINESS TRAVEL
1	$	500,000

¨ Multiple of salary applies, refer to the Supplemental Benefit Amounts Declarations.

The following are Losses covered and the corresponding Scheduled Benefit Amounts.

Accidental Loss of	Percent of Loss of Life Benefit Amount
Life	100%
Speech and Hearing	100%
Speech and one of: Hand, Foot or Sight of One Eye	100%
Hearing and one of: Hand, Foot or Sight of One Eye	100%
Both Hands, Both Feet or Sight of Both Eyes or a Combination of a Hand, a Foot or Sight of One Eye	100%
One Hand or One Foot or Sight of One Eye	50%
Speech or Hearing	50%
Thumb and Index Finger of the same Hand	25%

PERMANENT TOTAL DISABILITY MONTHLY BENEFIT

The following are Permanent Total Disability Benefit Amounts for each Class. The same Hazards apply as stated above for Accidental Loss of Life.

Class	Benefit Amount		Elimination Period
1	$	500,000	12 MONTHS

If an Insured Person has multiple Losses as the result of one Accident, we will pay only the single largest Benefit Amount applicable to the Losses suffered.

SEAT BELT

10 percent of the Accidental Loss of Life Benefit Amount.

	continued
Form 44-02-0893(Ed. 1-95)                        Declarations	Page 02

[GRAPHIC]

Blanket Accident Insurance

Declarations

Effective Date JANUARY 01, 2004

Policy Number 6404-48-82

(continued)

Section V - Maximum Limit Of Insurance

The following are the maximum amounts we will pay:

Limit of Insurance

$5,000,000                     per         ACCIDENT

If more than one (1) Insured Person suffers a Loss in the same Accident, we will not pay more than the maximum Limit of Insurance shown above. If an Accident results in Benefit Amounts becoming payable, which when totalled, exceed the applicable Limit of Insurance shown above, the maximum Limit of Insurance will be divided proportionally among the Insured Persons, based on each applicable Benefit Amount.

Coverage only applies for the Classes, Hazards, Benefit Amounts and Losses that are specifically indicated as covered.

	last page
Form 44-02-0893(Ed. 1-95)                        Declarations	Page 03

[GRAPHIC]

Blanket Accident Insurance

Insuring Agreement
	Chubb Group of Insurance Companies 15 Mountain View Road Warren, NJ 07059
Policyholder’s Name and Mailing Address
	Policy Number     6404-48-82
RYERSON TULL, INC. 2621 WEST 15TH PLACE CHICAGO, IL 60608	Effective Date     JANUARY 1, 2004
	Issued by the stock insurance company         indicated below, herein called the company.
	FEDERAL INSURANCE COMPANY
ProducerNo.    0030794	Incorporated under the laws of INDIANA
Producer      AON CONSULTING, INC 200 E RANDOLPH ST 13TH F CHICAGO, IL 60601-0000

Company and Policy Period

Insurance is issued by the Company in consideration of payment of the required premium.

This policy begins and ends at 12:01 AM Standard Time at the Policyholder’s address on the dates shown below:

From: JANUARY 1, 2004                  To: JANUARY 1, 2005

The Policyholder’s acceptance of this policy terminates, any prior policy of the same number issued to the Policyholder by the Company, effective with the inception of this policy.

This Insuring Agreement, together with the Premium Summary, Schedule Of Forms, Declarations, Contract, Hazards, Common Policy Conditions and Endorsements comprise this policy. If this policy is a renewal, we have only reissued to you those policy documents containing changes from your previous policy period coverages and any new additional coverages or policy provisions. All other policy documents continue in effect.

The Company issuing this policy has caused this policy to be signed by its authorized officers, but this policy shall not be valid unless also signed by a duly authorized representative of the Company.

FEDERAL INSURANCE COMPANY (incorporated under the laws of Indiana)

Illegible	Illegible
President	Secretary

Authorized Representative Illegible

Form 44-02-0893(Ed. 1-95)                        Insuring Agreement Page 1 of 1

EX-10.15

EXHIBIT 10.15

[INSERT DATE]

Name

Address

City/State/Zip

Dear                :

Ryerson Tull, Inc. (“RTI”) considers it essential to the best interests of its stockholders to foster the continuous employment of key management personnel of RTI and its subsidiaries (collectively, the “Company”). In this connection, the Board of Directors of RTI (the “Board”) recognizes that, as is the case with many publicly held corporations, the possibility of a change in control may exist and that such possibility, and the uncertainty and questions which it may raise among management, may result in the departure or distraction of management personnel to the detriment of RTI and its stockholders.

The Board has determined that appropriate steps should be taken to reinforce and encourage the continued attention and dedication of members of the Company’s management, including yourself, to their assigned duties without distraction in the face of potentially disturbing circumstances arising from the possibility of a change in control of the Company, although no such change is now contemplated. In order to induce you to remain in the employ of the Company and in consideration of your agreement set forth in Subsection 2(ii) hereof, RTI agrees that you shall receive the severance benefits set forth in this letter agreement (“Agreement”) in the event your employment with the Company is terminated subsequent to a “change in control of the Company” (as defined in Section 2 hereof) or in connection with a “potential change in control of the Company” (as defined in Section 2 hereof) under the circumstances described below. This Agreement shall constitute an amendment and restatement of and shall supersede any prior agreement entered into between you and RTI with respect to these matters. In the event that you receive severance benefits hereunder, such benefits shall be in lieu of, and you shall not be entitled to receive, any benefits or payments under any other severance plan, policy or agreement of or with the Company. In addition, if you are or become entitled to benefits from the Company pursuant to another agreement providing for benefits on account of a change in control or the law of a jurisdiction other than the United States or any state or territory thereof as a result of an event for which benefits are

payable to you pursuant this Agreement, the benefits paid to you pursuant to this Agreement shall be reduced by the amount paid to you pursuant to such other agreement or law; provided, however, that if you become entitled to benefits under this Agreement and an agreement with Inland Steel Industries, Inc. (“ISI”) on account of a change in control of ISI or any of its subsidiaries, (other than benefits payable under an agreement with ISI on account of events occurring prior to the date of this Agreement and which you are receiving as of the date of this Agreement) including RTI and its subsidiaries, the benefits provided under your agreement with ISI will be reduced by the amount of benefits payable to you pursuant to this Agreement on account of such change in control. In no event shall you be entitled to benefits under an agreement with ISI and this Agreement on account of the same events constituting a change in control, except as provided in the preceding sentence.

1. Term of Agreement. This Agreement shall commence on the date hereof and shall continue in effect through December 31, 2003; provided, however, that commencing on January 1, 2004 and each January 1 thereafter, the term of this Agreement shall automatically be extended for one additional year unless, during the preceding year but not later than June 30 of such preceding year, RTI shall have given notice that it does not wish to extend this Agreement. Notwithstanding the preceding sentence, (i) if your employer is a direct or indirect subsidiary of RTI, this Agreement shall terminate on the date on which RTI ceases to own, directly or indirectly, at least 80 percent of your employer for any reason which does not constitute a change in control of the Company, and (ii) if a change in control of the Company or a potential change in control of the Company shall have occurred during the original or extended term of this Agreement, this Agreement shall continue in effect for a period of twenty-four (24) months beyond the month in which such change in control or potential change in control of the Company occurred unless earlier terminated under clause (i) next above.

2. Change in Control; Potential Change in Control. (i) No benefits shall be payable hereunder unless there shall have been a potential change in control or a change in control of the Company, as set forth below. For purposes of this Agreement, a “change in control of the Company” shall be deemed to have occurred if:

(A) any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), other than (w) the Company, (x) a trustee or other fiduciary holding securities under an employee benefit plan of the Company, (y) an underwriter temporarily holding securities pursuant to an offering of such securities, or (z) a corporation owned, directly or indirectly, by the stockholders of RTI in substantially the same proportions as their ownership of stock of RTI, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the

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Exchange Act), directly or indirectly, of securities of RTI (not including in the securities beneficially owned by such person any securities acquired directly from RTI or its affiliates) representing 20% or more of the combined voting power of RTI’s then outstanding securities;

(B) during any period of two consecutive years (not including any period prior to the execution of this Agreement), individuals who at the beginning of such period constitute the Board and any new director (other than a director designated by a person who has entered into an agreement with RTI to effect a transaction described in clauses (A), (C) or (D) of this Subsection 2(i)) whose election by the Board or nomination for election by RTI’s stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved (“Continuing Directors”), cease for any reason to constitute a majority thereof;

(C) there occurs a merger or consolidation of RTI with any other corporation, other than a merger or consolidation which would result in the voting securities of RTI outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity), in combination with the ownership of any trustee or other fiduciary holding securities under an employee benefit plan of the Company, at least 60% of the combined voting power of the voting securities of RTI or such surviving entity outstanding immediately after such merger or consolidation, or a merger or consolidation effected to implement a recapitalization of RTI (or similar transaction) in which no person acquires more than 50% of the combined voting power of RTI’s then outstanding securities;

(D) the stockholders of RTI approve a plan of complete liquidation of RTI or an agreement for the sale or disposition by RTI of all or substantially all of RTI’s assets; or

(E) there occurs:

(x) a sale or disposition, directly or indirectly, other than to a person described in subclause (w), (x) or (z) of clause (A) of this Subsection 2(i), of securities of your employer, any direct or indirect parent company of your employer or any company that is a subsidiary of your employer and is also a significant subsidiary (as defined below) of RTI (your employer and such a parent or subsidiary being a “Related Company”), representing 50% or more of the combined voting power of the securities of such Related Company then outstanding;

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(y) a merger or consolidation of a Related Company with any other corporation, other than:

(1) a merger or consolidation which would result in the voting securities of the Related Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity), in combination with the ownership of any trustee or other fiduciary holding voting securities under an employee benefit plan of the Company, at least 60% of the combined voting power of the Related Company or such surviving entity outstanding immediately after such merger or consolidation;

(2) a merger or consolidation effected to implement a recapitalization of the Related Company (or similar transaction) in which no person acquires more than 50% of the combined voting power of the Related Company’s then outstanding voting securities; or

(3) a merger or consolidation which would result in 50% or more of the combined voting power of the surviving company being beneficially owned by ISI or by a majority owned direct or indirect subsidiary of RTI; or

(z) the sale or disposition of all or substantially all the assets of a Related Company to a person other than RTI or a majority owned direct or indirect subsidiary of RTI.

Notwithstanding any other provision of this Agreement, no change in control of the Company shall be deemed to have occurred under this Subsection 2(i) if (I) such transaction includes or involves a sale to the public or a distribution to the stockholders of RTI of more than 50% of the voting securities of your employer or a direct or indirect parent of your employer, and (II) your employer or a direct or indirect parent of your employer agrees to become a successor to RTI under this Agreement or you are covered by an agreement providing for benefits upon a change in control of your employer following an event described in clause (E). Notwithstanding any other provision of this Agreement, a merger or consolidation of RTI with and into ISI (regardless of whether or not RTI is the surviving entity) shall not be considered a change in control of the Company or potential change in control of the Company for purposes

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of this Agreement. For purposes of this Agreement, the term “significant subsidiary” has the meaning given to such term under Rule 405 of the Securities Act of 1933, as amended.

(ii) For purposes of this Agreement, a “potential change in control of the Company” shall be deemed to have occurred if:

(A) RTI enters into an agreement, the consummation of which would result in the occurrence of a change in control of the Company;

(B) any person (including RTI) publicly announces an intention to take or to consider taking actions which if consummated would constitute a change in control of the Company;

(C) any person, other than (w) the Company, (x) a trustee or other fiduciary holding securities under an employee benefit plan of the Company, (y) an underwriter temporarily holding securities pursuant to an offering of such securities, or (z) a corporation owned, directly or indirectly, by the stockholders of RTI in substantially the same proportions as their ownership of stock of RTI, who is or becomes the beneficial owner, directly or indirectly, of securities of RTI representing 9.5% or more of the combined voting power of RTI’s then outstanding securities, increases his beneficial ownership of such securities by 5% or more over the percentage so owned by such person on the date hereof; or

(D) the Board adopts a resolution to the effect that, for purposes of this Agreement, a potential change in control of the Company has occurred.

You agree that, subject to the terms and conditions of this Agreement, in the event of a potential change in control of the Company, you will remain in the employ of the Company until the earliest of (i) a date which is six (6) months from the occurrence of such potential change in control of the Company, (ii) the termination by you of your employment by reason of Disability or Retirement, as defined in Subsection 3(i), or (iii) the occurrence of a change in control of the Company. If your employment is terminated by the Company without Cause (as defined in Subsection 3(ii) below) coincident with or prior to a change in control of the Company and within twelve (12) months after the occurrence of a potential change in control of the Company and a change in control of the Company occurs within six (6) months after such termination, you shall be entitled to the compensation and benefits hereunder as if your termination of employment without Cause followed a change in control of the Company; provided, however, that no benefits shall be payable under this sentence if prior to the change in

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control of the Company, RTI ceased to own, directly or indirectly, at least 80% of the voting securities of your employer.

(iii) The foregoing to the contrary notwithstanding, a change in control of the Company shall not be deemed to have occurred with respect to you if:

(A) the event first giving rise to the potential change in control of the Company involves a publicly announced transaction or publicly announced proposed transaction which at the time of the announcement has not been previously approved by the Board and you are “part of a purchasing group” (as defined below) proposing the transaction;

(B) you are part of a purchasing group which consummates the change in control transaction; or

(C) the change in control of the Company would otherwise occur under Subsection 2(i)(D) due to the sale of a significant subsidiary, which significant subsidiary constitutes all or substantially all of the assets of RTI and you are not employed by RTI or the significant subsidiary which is the subject of the transaction.

For purposes of this Agreement, you shall be deemed “part of a purchasing group” if you are an equity participant or have agreed to become an equity participant in the purchasing company or group (except for (A) passive ownership of less than 1% of the stock of the purchasing company or (B) ownership of equity participation in the purchasing company or group which is otherwise not deemed to be significant, as determined prior to the change in control of the Company by a majority of the non-employee Continuing Directors).

3. Termination Following Change in Control. If a change in control of the Company, as defined in Section 2 hereof, shall have occurred, you shall be entitled to the benefits provided in Subsection 4(iii) hereof upon the subsequent termination of your employment during the term of this Agreement unless such termination is (A) because of your death, Disability or Retirement, (B) by the Company for Cause, or (C) by you other than for Good Reason.

(i) Disability; Retirement. If, as a result of your incapacity due to physical or mental illness, you shall have been absent from the full-time performance of your duties with the Company for six (6) consecutive months, and within thirty (30) days after written notice of termination is given you shall not have returned to the full-time performance of your duties, your employment may be terminated for “Disability”. Termination by the Company or you of

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your employment based on “Retirement” shall mean termination on or after your normal retirement age in accordance with the Company’s retirement policy generally applicable to its salaried employees or in accordance with any retirement arrangement established with your consent with respect to you.

(ii) Cause. Termination by the Company of your employment for “Cause” shall mean termination upon (A) the willful and continued failure by you to substantially perform your duties with the Company (other than any such failure resulting from your incapacity due to physical or mental illness or any such actual or anticipated failure after the issuance of a Notice of Termination by you for Good Reason as defined in Subsections 3(iv) and 3(iii), respectively) after a written demand for substantial performance is delivered to you by the Board, which demand specifically identifies the manner in which the Board believes that you have not substantially performed your duties, or (B) the willful engaging by you in conduct which is demonstrably and materially injurious to the Company, monetarily or otherwise. For purposes of this Subsection 3(ii), no act, or failure to act, on your part shall be deemed “willful” unless done, or omitted to be done, by you not in good faith and without reasonable belief that your action or omission was in the best interest of the Company. Notwithstanding the foregoing, you shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to you a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters (3/4) of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice to you and an opportunity for you, together with your counsel, to be heard before the Board), finding that in the good faith opinion of the Board you were guilty of conduct set forth above in clauses (A) or (B) of the first sentence of this Subsection 3(ii) and specifying the particulars thereof in detail; provided that, in the event of a dispute concerning the application of this provision, no claim by the Company that Cause exists shall be given effect unless the Company establishes to the Board by clear and convincing evidence that Cause exists.

(iii) Good Reason. You shall be entitled to terminate your employment for Good Reason. For purposes of this Agreement, “Good Reason” shall mean, without your express written consent, the occurrence after a change in control of the Company of any of the following circumstances unless, in the case of paragraphs (A), (E), (F), (G) or (H), such circumstances are fully corrected prior to the Date of Termination specified in the Notice of Termination, as defined in Subsections 3(v) and 3(iv), respectively, given in respect thereof:

(A) the assignment to you of any duties inconsistent with your status as an executive officer of the Company or a substantial adverse alteration in the nature or status of your responsibilities from those in effect immediately prior to the change in

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control of the Company other than any such alteration primarily attributable to the fact that the Company may no longer be a public company;

(B) a reduction by the Company in your annual base salary as in effect on the date hereof or as the same may be increased from time to time;

(C) the Company’s requiring that your principal place of business be at an office located more than 50 miles from where your principal place of business is located immediately prior to the change in control of the Company, except for required travel on the Company’s business to an extent substantially consistent with your business travel obligations immediately prior to the change in control of the Company;

(D) the failure by the Company, without your consent, to pay to you any portion of your current compensation, or to pay to you any portion of an installment of deferred compensation under any deferred compensation program of the Company, within seven (7) days of the date such compensation is due;

(E) the failure by the Company to continue in effect any compensation plan in which you participate immediately prior to the change in control of the Company which is material to your total compensation, including but not limited to the Ryerson Tull, Inc. Annual Performance Improvement Incentive Plan (the “Annual Incentive Plan”), Ryerson Tull 1996 Incentive Stock Plan (the “Incentive Stock Plan”), Ryerson Tull Supplemental Retirement Benefit Plan for Covered Employees (the “Supplemental Plan”), Ryerson Tull Nonqualified Savings Plan (the “Nonqualified Savings Plan”), Ryerson Tull Pension Plan (the “Pension Plan”) and Ryerson Tull Savings Plan (the “Savings Plan”) or any substitute or alternative plans adopted prior to the change in control (including substitute plans adopted by the Company in replacement of plans previously sponsored by ISI), unless an equitable arrangement (embodied in an ongoing substitute or alternative plan) has been made with respect to such plan, or the failure by the Company to continue your participation therein (or in such substitute or alternative plan) on a basis not materially less favorable, both in terms of the amount of benefits provided and the level of your participation relative to other participants, as existed at the time of the change in control;

(F) the failure by the Company to continue to provide you with benefits substantially similar to those enjoyed by you under any of the Company’s pension, life insurance, medical, health and accident, flexible spending or disability plans or programs in which you were participating at the time of the change in control of the

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Company, the taking of any action by the Company which would directly or indirectly materially reduce any of such benefits or deprive you of any material fringe benefit enjoyed by you at the time of the change in control of the Company, or the failure by the Company to provide you with the number of paid vacation days to which you are entitled on the basis of years of service with the Company in accordance with the Company’s normal vacation policy in effect at the time of the change in control of the Company;

(G) the failure of RTI to obtain a satisfactory agreement from any successor to assume and agree to perform this Agreement, as contemplated in Section 5 hereof; or

(H) any purported termination of your employment which is not effected pursuant to a Notice of Termination satisfying the requirements of Subsection 3(iv) below (and, if applicable, the requirements of Subsection 3(ii) above); for purposes of this Agreement, no such purported termination shall be effective.

Your right to terminate your employment pursuant to this Section 3 shall not be affected by your incapacity due to physical or mental illness. Your continued employment shall not constitute consent to, or a waiver of rights with respect to, any circumstance constituting Good Reason hereunder. For purposes of any determination regarding the existence of Good Reason, any claim by you that Good Reason exists shall be presumed to be correct unless the Company establishes to the Board by clear and convincing evidence that Good Reason does not exist.

(iv) Notice of Termination. Any purported termination of your employment by the Company or by you shall be communicated by written Notice of Termination to the other party hereto in accordance with Section 6 hereof. For purposes of this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of your employment under the provision so indicated.

(v) Date of Termination, Etc. “Date of Termination” shall mean (A) if your employment is terminated for Disability, thirty (30) days after Notice of Termination is given (provided that you shall not have returned to the full-time performance of your duties during such thirty (30) day period), and (B) if your employment is terminated pursuant to Subsection 3(ii) or 3(iii) above or for any other reason (other than Disability), the date specified in the Notice of Termination (which, in the case of a termination pursuant to Subsection 3(ii) above shall not be less than thirty (30) days, and in the case of a termination pursuant to Subsection 3(iii) above shall not be less than fifteen (15) nor more than sixty (60) days, respectively, from

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the date such Notice of Termination is given); provided that if within fifteen (15) days after any Notice of Termination is given, or, if later, prior to the Date of Termination (as determined without regard to this proviso), the party receiving such Notice of Termination notifies the other party that a dispute exists concerning the termination, the Date of Termination shall be the date on which the dispute is finally determined, either by mutual written agreement of the parties, by a binding arbitration award, or by a final judgment, order or decree of a court of competent jurisdiction (which is not appealable or with respect to which the time for appeal therefrom has expired and no appeal has been perfected) but shall be deemed to be within the twenty-four (24) month period following a change in control of the Company; provided further that the Date of Termination shall be extended by a notice of dispute only if such notice is given in good faith and the party giving such notice pursues the resolution of such dispute with reasonable diligence. Notwithstanding the pendency of any such dispute, the Company will continue to pay you your full compensation in effect when the notice giving rise to the dispute was given (including, but not limited to, base salary) and continue you as a participant in all compensation, benefit and insurance plans and programs in which you were participating when the notice giving rise to the dispute was given, until the dispute is finally resolved in accordance with this Subsection 3(v). Amounts paid under this Subsection 3(v) are in addition to all other amounts due under this Agreement and shall not be offset against or reduce any other amounts due under this Agreement.

4. Compensation Upon Termination or During Disability. Following a change in control of the Company, as defined by Subsection 2(i), upon termination of your employment or during a period of Disability you shall be entitled to the following benefits:

(i) During any period that you fail to perform your full-time duties with the Company as a result of incapacity due to physical or mental illness, you shall continue to receive your base salary at the rate in effect at the commencement of any such period, together with all compensation payable to you under the Pension Plan, Supplemental Plan, Annual Incentive Plan, Savings Plan and Nonqualified Savings Plan during such period, until this Agreement is terminated pursuant to Subsection 3(i) hereof. Thereafter, in the event your employment shall be terminated, your benefits shall be determined under the Company’s retirement, insurance and other compensation plans and programs then in effect in accordance with the terms of such plans and programs.

(ii) If your employment shall be terminated by the Company for Cause or by you other than for Good Reason, Disability, death or Retirement, the Company shall pay you your full base salary through the Date of Termination at the rate in effect at the time Notice of Termination is given, plus all other amounts to which you are entitled under any compensation

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plan of the Company at the time such payments are due, and the Company shall have no further obligations to you under this Agreement.

(iii) If your employment by the Company shall be terminated (a) by the Company other than for Cause, Retirement or Disability or (b) by you for Good Reason, then you shall be entitled to the compensation and benefits provided below:

(A) The Company shall pay you your full base salary through the Date of Termination at the rate in effect at the time Notice of Termination is given, plus all other amounts to which you are entitled under any compensation plan or program of the Company, at the time such payments are due, except as otherwise provided below.

(B) In lieu of any further salary payments to you for periods subsequent to the Date of Termination, the Company shall pay as severance pay to you a lump sum severance payment (together with the payments provided in paragraphs C, D and E below, the “Severance Payments”) equal to three times the sum of (x) your annual base salary in effect immediately prior to the occurrence of the circumstance giving rise to the Notice of Termination given in respect thereof, and (y) the greater of (I) your target award under the Annual Incentive Plan or similar successor plan for the year in which the Date of Termination occurs, or (II) the average annual amount of the Award paid to you pursuant to the Annual Incentive Plan or similar successor plan with respect to the five years immediately preceding that in which the Date of Termination occurs, such average annual amount being calculated by aggregating all such Awards paid with respect to such five years and dividing such aggregate amount by the number of years for which such an Award was actually paid to you.

(C) Notwithstanding any provision of the Annual Incentive Plan, the Company shall pay a lump sum under the Plan at least equal to the sum of (x) any incentive compensation under the Annual Incentive Plan which has been allocated or awarded to you for a completed fiscal year or other measuring period preceding the Date of Termination but has not yet been paid, and (y) a pro rata portion to the Date of Termination for the current fiscal year or other measuring period of the amount equal to the Target Award percentage applicable to you under the Annual Incentive Plan or similar successor plan on the Date of Termination times your annual base salary then in effect.

(D) In lieu of shares of common stock of RTI (“RTI Shares”) issuable upon exercise of outstanding stock options (“Options”) granted to you under RTI’s stock

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option plans (which Options shall be cancelled upon the making of the payment referred to below), you shall receive an amount in cash equal to the product of (i) the excess of (x) in the case of incentive stock options (as defined in section 422A of the Internal Revenue Code of 1986, as amended (the “Code”)) (“ISOs”)), granted after June 10, 1996, the closing price of RTI’s shares as reported on the New York Stock Exchange Composite Transactions on or nearest the Date of Termination, in the case of all other Options, the Change in Control Price (as defined below), over (y) the per share exercise price of each Option then held by you (whether or not then fully exercisable), times (ii) the number of RTI Shares covered by each such Option. For purposes of this Agreement, the “Change in Control Price” means (1) with respect to a merger or consolidation of RTI described in Subsection 2(i)(C) in which the consideration per share of RTI’s common stock to be paid for the acquisition of shares of common stock specified in the agreement of merger or consolidation is all in cash, the highest such consideration per share, (2) with respect to a change in control of the Company by reason of an acquisition of securities described in Subsection 2(i)(A), the highest price per share for any share of RTI’s common stock paid by any holder of any of the securities representing 20% or more of the combined voting power of RTI giving rise to the change in control of the Company, and (3) with respect to a change in control of the Company by reason of a merger or consolidation of RTI (other than a merger or consolidation described in Clause (1) next above), stockholder approval of an agreement or plan described in Subsection 2(i)(D), a change in the composition of the Board described in Subsection 2(i)(B) or a change in control of the Company pursuant to Subsection 2(i)(E) (relating to mergers, consolidations and sales of securities or assets of a Related Company), the highest price per share of common stock reported on the New York Stock Exchange Composite Transactions (or, if such shares are not traded on the New York Stock Exchange, such other principal market on which such shares are traded) during the sixty (60) day period ending on the date the change in control of the Company occurs. In the event ISI shares are substituted for RTI Shares under the Options, references to RTI Shares as used shall be deemed to refer to shares of ISI common stock that are substituted for RTI Shares thereunder.

(E) To the extent not otherwise vested in accordance with the terms and conditions of the Incentive Stock Plan, you shall be fully vested in any restricted shares issued thereunder and be fully vested in any performance shares that you would have earned under the Incentive Stock Plan for the calendar year in which the change in control of the Company occurs had the applicable performance targets for such calendar year been satisfied with respect to such shares.

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(F) The Company shall also pay to you all legal fees and expenses incurred by you as a result of such termination (including all such fees and expenses, if any, incurred in contesting or disputing any such termination or in seeking to obtain or enforce any right or benefit provided by this Agreement or in connection with any tax audit or proceeding to the extent attributable to the application of Section 4999 of the Code to any payment or benefit provided hereunder). Such payments shall be made within five (5) days after your request for payment accompanied with such evidence of fees and expenses incurred as the Company reasonably may require. You shall be entitled to select your legal counsel, and your rights to payment pursuant to this paragraph (F) shall not be affected by the final outcome of any dispute with the Company.

(G) In the event that you become entitled to any payments provided for hereinabove (the “Contract Payments”), if the Contract Payments or other portion of the Total Payments (as defined below) will be subject to the tax (the “Excise Tax”) imposed by Section 4999 of the Code, the Company shall pay to you, no later than the fifth day following the Date of Termination, an additional amount (the “Gross-Up Payment”) such that the net amount retained by you, after deduction of any Excise Tax on the Contract Payments and such other Total Payments and any federal and state and local income and other payroll taxes and Excise Tax upon the payment provided for by this paragraph (G), shall be equal to the Contract Payments and such other Total Payments.

(H) For purposes of determining whether any of the payments will be subject to the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits received or to be received by you in connection with a change in control of the Company or your termination of employment (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement with the Company, any person whose actions result in a change in control or any person affiliated with the Company or such person) payable pursuant to the terms of this Agreement or any other plan, arrangement or agreement with the Company, any person whose actions result in a change in control or any person affiliated with the Company or such person (together with the Contract Payments, the “Total Payments”), shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code and all “excess parachute payments” within the meaning of Section 280G(b)(l) of the Code shall be treated as subject to the Excise Tax unless in the opinion of tax counsel selected by RTI’s independent auditors and reasonably acceptable to you, such other payments or benefits (in whole or in part) do not constitute parachute payments, including by reason of Section 280G(b)(4)(A) of the Code or such excess parachute payments (in whole or

Page 13

in part) represent reasonable compensation for services actually rendered within the meaning of Section 280G(b)(4)(B) of the Code in excess of the base amount allocable to such reasonable compensation within the meaning of Section 280G(b)(3) of the Code, or are otherwise not subject to the Excise Tax, (ii) the amount of the Total Payments which shall be treated as subject to the Excise Tax shall be equal to the lesser of (A) the amount of the Total Payments or (B) the amount of excess parachute payments within the meaning of Section 280G(b)(l) of the Code (after applying clause (i) above), and (iii) the value of any noncash benefits or any deferred payment or benefit shall be determined by RTI’s independent auditors in accordance with the principles of Sections 280G(d)(3) and (4) of the Code. For purposes of determining the amount of the Gross-Up Payment, you shall be deemed to pay federal income taxes at the highest marginal rate of federal income taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest marginal rate of taxation in the state and locality of your residence on the Date of Termination, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes.

(I) In the event that the Excise Tax is subsequently determined to be less than the amount taken into account hereunder at the time of termination of your employment, you shall repay to the Company at the time that the amount of such reduction in Excise Tax is finally determined the portion of the Gross-Up Payment attributable to such reduction (plus the portion of the Gross-Up Payment attributable to the Excise Tax and federal and state and local income tax imposed on the Gross-Up Payment being repaid by you if such repayment results in a reduction in Excise Tax and/or a federal and state and local income tax deduction) plus interest on the amount of such repayment at the rate provided in Section 1274(b)(2)(B) of the Code. In the event that the Excise Tax is determined to exceed the amount taken into account hereunder at the time of the termination of your employment (including by reason of any payment the existence or amount of which cannot be determined at the time of the Gross-Up Payment), the Company shall make an additional gross-up payment in respect of such excess (plus any interest payable with respect to such excess) at the time that the amount of such excess is finally determined.

(J) The payments provided for in paragraphs (B), (C), (D) and (E) above, shall be made not later than the fifth day following the Date of Termination, provided, however, that if the amounts of such payments cannot be finally determined on or before such day, the Company shall pay to you on such day an estimate, as determined in good faith by the Company, of the minimum amount of such payments and shall pay

Page 14

the remainder of such payments (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code) as soon as the amount thereof can be determined but in no event later than the thirtieth day after the Date of Termination. In the event that the amount of the estimated payments exceeds the amount subsequently determined to have been due, such excess shall constitute a loan by the Company to you payable on the fifth day after demand by the Company (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code).

(iv) If your employment shall be terminated (A) by the Company other than for Cause, Retirement or Disability or (B) by you for Good Reason, then for a thirty-six (36) month period after such termination, the Company shall arrange to provide you with: (1) life, disability, accident and health insurance benefits substantially similar to those which you are receiving immediately prior to the Notice of Termination, (2) financial advisory services similar to those provided currently to executives of the Company, and (3) outplacement services. Benefits otherwise receivable by you pursuant to this Subsection 4(iv) shall be reduced to the extent comparable benefits are actually received by you during the thirty-six (36) month period following your termination, and any such benefits actually received by you shall be reported to the Company. Any rights that you have to continuation of life, disability, accident or health coverage under applicable state or federal law shall be in addition to those provided under this Agreement.

(v) If your employment shall be terminated (A) by the Company other than for Cause, Retirement or Disability or (B) by you for Good Reason, then in addition to the retirement benefits to which you are entitled under the Pension Plan or Supplemental Plan or any successor plans thereto, the Company shall pay you in cash at the time and in the manner provided in paragraph (J) of Subsection 4(iii), a lump sum equal to the excess of (x) the actuarial equivalent of the retirement pension (taking into account any early retirement subsidy associated therewith and determined as a straight life annuity commencing at age sixty-five (65) or any earlier date, but in no event earlier than the second anniversary of the Date of Termination whichever annuity yields a greater benefit) which you would have accrued under the terms of the Pension Plan or Supplemental Plan (without regard to any amendments to any such plans made subsequent to a change in control of the Company and on or prior to the Date of Termination, which amendment adversely affects in any manner the computation of retirement benefits thereunder), determined as if you were fully vested thereunder and had accumulated (after the Date of Termination) thirty-six (36) additional months of age and service credit thereunder at the higher of the rate of average compensation during the twelve (12) months prior to the change in control of the Company or the rate of average compensation used to calculate your benefits under such plans immediately preceding the Date of Termination, over (y) the actuarial equivalent of the retirement pension (taking into account any early

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retirement subsidy associated therewith and determined as a straight life annuity commencing at age sixty-five (65) or any earlier date, but in no event earlier than the Date of Termination whichever annuity yields a greater benefit) which you had then accrued pursuant to the provisions of the Pension Plan and the Supplemental Pension Plan. For purposes of this Subsection 4(v), “actuarial equivalent” shall be determined using the same assumptions utilized under the Pension Plan for purposes of determining alternative forms of benefits immediately prior to the change in control of the Company.

(vi) You shall not be required to mitigate the amount of any payment provided for in this Section 4 by seeking other employment or otherwise, nor shall the amount of any payment or benefit provided for in this Section 4 be reduced by any compensation earned by you as the result of employment by another employer, by retirement benefits, by offset against any amount claimed to be owed by you to the Company, or otherwise, except as provided in Subsection 4(iv).

(vii) In addition to all other amounts payable to you under this Section 4, you shall be entitled to receive all benefits payable to you under the Pension Plan, the Savings Plan, Supplemental Plan, Nonqualified Savings Plan (or any substitute or alternative plan or plans) and any other plan or agreement relating to retirement benefits.

5. Successors; Binding Agreement. (i) RTI will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of RTI to expressly assume and agree to perform this Agreement in the same manner and to the same extent that RTI or the Company would be required to perform it if no such succession had taken place. Failure of RTI to obtain such assumption and agreement prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle you to compensation from the Company in the same amount and on the same terms as you would be entitled to hereunder if you terminate your employment for Good Reason following a change in control of the Company, except that for purposes of implementing the foregoing, the date on which any such succession becomes effective shall be deemed the Date of Termination. In the event a successor of RTI assumes and agrees to perform this Agreement, by operation of law or otherwise, the term “RTI”, as used in this Agreement, shall mean such successor and the term “Company” shall mean, collectively, such successor and the affiliates of such successor.

(ii) This Agreement shall inure to the benefit of and be enforceable by your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If you should die while any amount would still be payable to you hereunder if you

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had continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to your devisee, legatee or other designee or, if there is no such designee, to your estate.

6. Notice. For the purpose of this Agreement, notices and all other communications provided for in the Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States registered mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth on the first page of this Agreement, provided that all notice to the Company shall be directed to the attention of the Board with a copy to the Secretary of RTI, or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notice of change of address shall be effective only upon receipt.

7. Miscellaneous. No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by you and such officer as may be specifically designated by the Board. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not expressly set forth in this Agreement. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of Illinois. All references to sections of the Exchange Act or the Code shall be deemed also to refer to any successor provisions to such sections. Any payments provided for hereunder shall be paid net of any applicable withholding required under federal, state or local law. The obligations of the RTI and the Company under Section 4 shall survive the expiration of the term of this Agreement.

8. Validity. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

9. Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

10. Settlement of Disputes; Arbitration. All claims by you for benefits under this Agreement shall be directed to and determined by the Board and shall be in writing. Any

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denial by the Board of a claim for benefits under this Agreement shall be delivered to you in writing and shall set forth the specific reasons for the denial and the specific provisions of this Agreement relied upon. The Board shall afford a reasonable opportunity to you for a review of the decision denying a claim and shall further allow you to appeal to the Board a decision of the Board within sixty (60) days after notification by the Board that your claim has been denied. Any further dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration in Chicago, Illinois, in accordance with the rules of the American Arbitration Association then in effect, provided, however, that the evidentiary standards set forth in this Agreement shall apply. Judgment may be entered on the arbitrator’s award in any court having jurisdiction; provided, however, that you shall be entitled to seek specific performance of your right to be paid until the Date of Termination during the pendency of any dispute or controversy arising under or in connection with this Agreement.

If this letter sets forth our agreement on the subject matter hereof, kindly sign and return to RTI the enclosed copy of this letter which will then constitute our agreement on this subject.

Sincerely,
RYERSON TULL, INC.
By:
Its:	Vice President - Human Resources

Agreed to this                      day

of                                         , 2003.

                                              (Signature)

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EX-10.16

Exhibit 10.16

Schedule to Form of Change in Control Agreement between

Ryerson Tull, Inc. and the following parties:

Neil S. Novich

Jay M. Gratz

Gary J. Niederpruem

EX-10.17

EXHIBIT 10.17

[INSERT DATE]

Name

Address

City/State/Zip

Dear                :

Ryerson Tull, Inc. (“RTI”) considers it essential to the best interests of its stockholders to foster the continuous employment of key management personnel of RTI and its subsidiaries (collectively, the “Company”). In this connection, the Board of Directors of RTI (the “Board”) recognizes that, as is the case with many publicly held corporations, the possibility of a change in control may exist and that such possibility, and the uncertainty and questions which it may raise among management, may result in the departure or distraction of management personnel to the detriment of RTI and its stockholders.

The Board has determined that appropriate steps should be taken to reinforce and encourage the continued attention and dedication of members of the Company’s management, including yourself, to their assigned duties without distraction in the face of potentially disturbing circumstances arising from the possibility of a change in control of the Company. In order to induce you to remain in the employ of the Company and in consideration of your agreement set forth in Subsection 2(ii) hereof, RTI agrees that you shall receive the severance benefits set forth in this letter agreement (“Agreement”) in the event your employment with the Company is terminated subsequent to a “change in control of the Company” (as defined in Section 2 hereof) or in connection with a “potential change in control of the Company” (as defined in Section 2 hereof) under the circumstances described below. This Agreement shall constitute an amendment and restatement of and shall supersede any prior agreement entered into between you and RTI with respect to these matters. In the event that you receive severance benefits hereunder, such benefits shall be in lieu of, and you shall not be entitled to receive, any benefits or payments under any other severance plan, policy or agreement of or with the Company. In addition, if you are or become entitled to benefits from the Company pursuant to another agreement providing for benefits on account of a change in control or the law of a jurisdiction other than the United States or any state or territory thereof as a result of an event for which benefits are payable to you pursuant this Agreement, the benefits paid to you pursuant to this Agreement shall be reduced by the amount paid to you pursuant to such other agreement or law.

1. Term of Agreement. This Agreement shall commence on the date hereof and shall continue in effect through December 31, 2003; provided, however, that commencing on January 1, 2004 and each January 1 thereafter, the term of this Agreement shall automatically be extended for one additional year unless, during the preceding year but not later than June 30 of such preceding year, RTI shall have given notice that it does not wish to extend this Agreement.

Notwithstanding the preceding sentence: (i) if your employer is a direct or indirect subsidiary of RTI, this Agreement shall terminate on the date on which RTI ceases to own, directly or indirectly, at least 80 percent of your employer for any reason which does not constitute a change in control of the Company, and (ii) if a change in control of the Company or a potential change in control of the Company shall have occurred during the original or extended term of this Agreement, this Agreement shall continue in effect for a period of twenty-four (24) months beyond the month in which such change in control or potential change in control of the Company occurred unless earlier terminated under clause (i) next above.

2. Change in Control; Potential Change in Control. (i) No benefits shall be payable hereunder unless there shall have been a potential change in control or a change in control of the Company, as set forth below. For purposes of this Agreement, a “change in control of the Company” shall be deemed to have occurred if:

(A) any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), other than (w) the Company, (x) a trustee or other fiduciary holding voting securities under an employee benefit plan of the Company, (y) an underwriter temporarily holding voting securities pursuant to an offering of such securities, or (z) a corporation owned, directly or indirectly, by the security holders of RTI in substantially the same proportions as their ownership of voting securities of RTI, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of voting securities of RTI (not including in the voting securities beneficially owned by such person any voting securities acquired directly from RTI or its affiliates) representing 20% or more of the combined voting power of RTI’s then outstanding voting securities;

(B) during any period of two consecutive years (not including any period prior to the execution of this Agreement), individuals who at the beginning of such period constitute the Board and any new director (other than a director designated by a person who has entered into an agreement with RTI to effect a transaction described in clauses (A), (C) or (D) of this Subsection 2(i)) whose election by the Board or nomination for election by RTI’s security holders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved (“Continuing Directors”), cease for any reason to constitute a majority thereof;

(C) there occurs a merger or consolidation of RTI with any other corporation, other than a merger or consolidation which would result in the voting securities of RTI outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity), in combination with the ownership of any trustee or other fiduciary holding voting securities under an employee benefit plan of the Company, at least 60% of the combined voting power of the voting securities of RTI or such surviving entity outstanding immediately after such merger or consolidation, or a merger or consolidation effected to implement a recapitalization of RTI (or similar transaction) in which no person acquires more than 50% of the combined voting power of RTI’s then outstanding voting securities;

Page 2

(D) the holders of voting securities of RTI approve a plan of complete liquidation of RTI or an agreement for the sale or disposition by RTI of all or substantially all of RTI’s assets; or

(E) there occurs:

(x) a sale or disposition, directly or indirectly, other than to a person described in subclause (w), (x) or (z) of clause (A) of this Subsection 2(i), of voting securities of your employer, any direct or indirect parent company of your employer or any company that is a subsidiary of your employer and is also a significant subsidiary (as defined below) of RTI (your employer and such a parent or subsidiary being a “Related Company”), representing 50% or more of the combined voting power of the securities of such Related Company then outstanding;

(y) a merger or consolidation of a Related Company with any other corporation, other than:

(1) a merger or consolidation which would result in the voting securities of the Related Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity), in combination with the ownership of any trustee or other fiduciary holding voting securities under an employee benefit plan of the Company, at least 60% of the combined voting power of the voting securities of the Related Company or such surviving entity outstanding immediately after such merger or consolidation;

(2) a merger or consolidation effected to implement a recapitalization of the Related Company (or similar transaction) in which no person acquires more than 50% of the combined voting power of the Related Company’s then outstanding voting securities; or

(3) a merger or consolidation which would result in 50% or more of the combined voting power of the surviving company being beneficially owned by RTI or by a majority owned direct or indirect subsidiary of RTI; or

(z) the sale or disposition of all or substantially all the assets of a Related Company to a person other than RTI or a majority owned direct or indirect subsidiary of RTI.

Notwithstanding any other provision of this Agreement, no change in control of the Company shall be deemed to have occurred under this Subsection 2(i) if (I) such transaction includes or involves a sale to the public or a distribution to the stockholders of RTI of more than 50% of the voting securities of your employer or a direct or indirect parent of your employer, and (II) your employer or a direct or indirect parent of your employer agrees to become a successor to RTI under this Agreement or you are covered by an agreement providing for benefits upon a change

Page 3

in control of your employer following an event described clause (E). For purposes of this Agreement, the term “significant subsidiary” has the meaning given to such term under Rule 405 of the Securities Act of 1933, as amended.

(ii) For purposes of this Agreement, a “potential change in control of the Company” shall be deemed to have occurred if:

(A) RTI enters into an agreement, the consummation of which would result in the occurrence of a change in control of the Company;

(B) any person (including RTI) publicly announces an intention to take or to consider taking actions which if consummated would constitute a change in control of the Company;

(C) any person, other than (w) the Company, (x) a trustee or other fiduciary holding voting securities under an employee benefit plan of the Company, (y) an underwriter temporarily holding voting securities pursuant to an offering of such securities, or (z) a corporation owned, directly or indirectly, by the security holders of RTI in substantially the same proportions as their ownership of voting securities of RTI, who is or becomes the beneficial owner, directly or indirectly, of voting securities of RTI representing 9.5% or more of the combined voting power of RTI’s then outstanding voting securities, increases his beneficial ownership of such securities by 5% or more over the percentage so owned by such person on the date hereof; or

(D) the Board adopts a resolution to the effect that, for purposes of this Agreement, a potential change in control of the Company has occurred.

You agree that, subject to the terms and conditions of this Agreement, in the event of a potential change in control of the Company, you will remain in the employ of the Company until the earliest of (i) a date which is six (6) months from the occurrence of such potential change in control of the Company, (ii) the termination by you of your employment by reason of Disability or Retirement, as defined in Subsection 3(i), or (iii) the occurrence of a change in control of the Company. If your employment is terminated by the Company without Cause (as defined in Subsection 3(ii) below) coincident with or prior to a change in control of the Company and within twelve (12) months after the occurrence of a potential change in control of the Company and a change in control of the Company occurs within six (6) months after such termination, you shall be entitled to the compensation and benefits hereunder as if your termination of employment without Cause followed a change in control of the Company; provided, however, that no benefits shall be payable under this sentence if prior to the change in control of the Company, RTI ceased to own, directly or indirectly, at least 80% of the voting securities of your employer.

(iii) The foregoing to the contrary notwithstanding, a change in control of the Company shall not be deemed to have occurred with respect to you if:

(A) the event first giving rise to the potential change in control of the Company involves a publicly announced transaction or publicly announced proposed transaction which at the time of the announcement has not been previously approved by

Page 4

the Board and you are “part of a purchasing group” (as defined below) proposing the transaction;

(B) you are part of a purchasing group which consummates the change in control transaction; or

(C) the change in control of the Company would otherwise occur under Subsection 2(i)(D) due to the sale of a significant subsidiary, which significant subsidiary constitutes all or substantially all of the assets of RTI and you are not employed by RTI or the significant subsidiary which is the subject of the transaction.

For purposes of this Agreement, you shall be deemed “part of a purchasing group” if you are an equity participant or have agreed to become an equity participant in the purchasing company or group (except for (A) passive ownership of less than 1% of the stock of the purchasing company or (B) ownership of equity participation in the purchasing company or group which is otherwise not deemed to be significant, as determined prior to the change in control of the Company by a majority of the non-employee Continuing Directors).

3. Termination Following Change in Control. If a change in control of the Company, as defined in Section 2 hereof, shall have occurred, you shall be entitled to the benefits provided in Subsection 4(iii) hereof upon the subsequent termination of your employment during the term of this Agreement unless such termination is (A) because of your death, Disability or Retirement, (B) by the Company for Cause, or (C) by you other than for Good Reason.

(i) Disability; Retirement. If, as a result of your incapacity due to physical or mental illness, you shall have been absent from the full-time performance of your duties with the Company for six (6) consecutive months, and within thirty (30) days after written notice of termination is given you shall not have returned to the full-time performance of your duties, your employment may be terminated for “Disability”. Termination by the Company or you of your employment based on “Retirement” shall mean termination on or after your normal retirement age in accordance with the Company’s retirement policy generally applicable to its salaried employees or in accordance with any retirement arrangement established with your consent with respect to you.

(ii) Cause. Termination by the Company of your employment for “Cause” shall mean termination upon (A) the willful and continued failure by you to substantially perform your duties with the Company (other than any such failure resulting from your incapacity due to physical or mental illness or any such actual or anticipated failure after the issuance of a Notice of Termination by you for Good Reason as defined in Subsections 3(iv) and 3(iii), respectively) after a written demand for substantial performance is delivered to you by the Board, which demand specifically identifies the manner in which the Board believes that you have not substantially performed your duties, or (B) the willful engaging by you in conduct which is demonstrably and materially injurious to the Company, monetarily or otherwise. For purposes of this Subsection 3(ii), no act, or failure to act, on your part shall be deemed “willful” unless done, or omitted to be done, by you not in good faith and without reasonable belief that your action or omission was in the best interest of the Company. Notwithstanding the foregoing, you shall not

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be deemed to have been terminated for Cause unless and until there shall have been delivered to you a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters (3/4) of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice to you and an opportunity for you, together with your counsel, to be heard before the Board), finding that in the good faith opinion of the Board you were guilty of conduct set forth above in clauses (A) or (B) of the first sentence of this Subsection 3(ii) and specifying the particulars thereof in detail; provided that, in the event of a dispute concerning the application of this provision, no claim by the Company that Cause exists shall be given effect unless the Company establishes to the Board by clear and convincing evidence that Cause exists.

(iii) Good Reason. You shall be entitled to terminate your employment for Good Reason. For purposes of this Agreement, “Good Reason” shall mean, without your express written consent, the occurrence after a change in control of the Company of any of the following circumstances unless, in the case of paragraphs (A), (E), (F), (G) or (H), such circumstances are fully corrected prior to the Date of Termination specified in the Notice of Termination, as defined in Subsections 3(v) and 3(iv), respectively, given in respect thereof:

(A) the assignment to you of any duties inconsistent with your status as an executive officer of the Company or a substantial adverse alteration in the nature or status of your responsibilities from those in effect immediately prior to the change in control of the Company other than any such alteration primarily attributable to the fact that the Company may no longer be a public company;

(B) a reduction by the Company in your annual base salary as in effect on the date hereof or as the same may be increased from time to time;

(C) the Company’s requiring that your principal place of business be at an office located more than 50 miles from where your principal place of business is located immediately prior to the change in control of the Company, except for required travel on the Company’s business to an extent substantially consistent with your business travel obligations immediately prior to the change in control of the Company;

(D) the failure by the Company, without your consent, to pay to you any portion of your current compensation, or to pay to you any portion of an installment of deferred compensation under any deferred compensation program of the Company, within seven (7) days of the date such compensation is due;

(E) the failure by the Company to continue in effect any compensation plan in which you participate immediately prior to the change in control of the Company which is material to your total compensation, including but not limited to the Ryerson Tull Annual Incentive Plan (the “Annual Incentive Plan”), Ryerson Tull 1995 Incentive Stock Plan and Ryerson Tull 1999 Incentive Stock Plan (collectively, the “Incentive Stock Plans”), Ryerson Tull Supplemental Retirement Plan for Covered Employees (the “Supplemental Plan”), Ryerson Tull Nonqualified Savings Plan (the “Nonqualified Savings Plan”), Ryerson Tull Pension Plan (the “Pension Plan”) the Ryerson Tull Savings Plan or the J.M. Tull Metals Company, Inc. Employees’ Profit Sharing Plan (either, the “Savings Plan”) or any substitute or alternative plans adopted prior to the

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change in control, unless an equitable arrangement (embodied in an ongoing substitute or alternative plan) has been made with respect to such plan, or the failure by the Company to continue your participation therein (or in such substitute or alternative plan) on a basis not materially less favorable, both in terms of the amount of benefits provided and the level of your participation relative to other participants, as existed at the time of the change in control;

(F) the failure by the Company to continue to provide you with benefits substantially similar to those enjoyed by you under any of the Company’s pension, life insurance, medical, health and accident, flexible spending or disability plans or programs in which you were participating at the time of the change in control of the Company, the taking of any action by the Company which would directly or indirectly materially reduce any of such benefits or deprive you of any material fringe benefit enjoyed by you at the time of the change in control of the Company, or the failure by the Company to provide you with the number of paid vacation days to which you are entitled on the basis of years of service with the Company in accordance with the Company’s normal vacation policy in effect at the time of the change in control of the Company;

(G) the failure of RTI to obtain a satisfactory agreement from any successor to assume and agree to perform this Agreement, as contemplated in Section 5 hereof; or

(H) any purported termination of your employment which is not effected pursuant to a Notice of Termination satisfying the requirements of Subsection 3(iv) below (and, if applicable, the requirements of Subsection 3(ii) above); for purposes of this Agreement, no such purported termination shall be effective.

Your right to terminate your employment pursuant to this Section 3 shall not be affected by your incapacity due to physical or mental illness. Your continued employment shall not constitute consent to, or a waiver of rights with respect to, any circumstance constituting Good Reason hereunder. For purposes of any determination regarding the existence of Good Reason, any claim by you that Good Reason exists shall be presumed to be correct unless the Company establishes to the Board by clear and convincing evidence that Good Reason does not exist.

(iv) Notice of Termination. Any purported termination of your employment by the Company or by you shall be communicated by written Notice of Termination to the other party hereto in accordance with Section 6 hereof. For purposes of this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of your employment under the provision so indicated.

(v) Date of Termination, Etc. “Date of Termination” shall mean (A) if your employment is terminated for Disability, thirty (30) days after Notice of Termination is given (provided that you shall not have returned to the full-time performance of your duties during such thirty (30) day period), and (B) if your employment is terminated pursuant to Subsection 3(ii) or 3(iii) above or for any other reason (other than Disability), the date specified in the Notice of Termination (which, in the case of a termination pursuant to Subsection 3(ii) above shall not be less than thirty (30) days, and in the case of a termination pursuant to Subsection

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3(iii) above shall not be less than fifteen (15) nor more than sixty (60) days, respectively, from the date such Notice of Termination is given); provided that if within fifteen (15) days after any Notice of Termination is given, or, if later, prior to the Date of Termination (as determined without regard to this proviso), the party receiving such Notice of Termination notifies the other party that a dispute exists concerning the termination, the Date of Termination shall be the date on which the dispute is finally determined, either by mutual written agreement of the parties, by a binding arbitration award, or by a final judgment, order or decree of a court of competent jurisdiction (which is not appealable or with respect to which the time for appeal therefrom has expired and no appeal has been perfected) but shall be deemed to be within the twenty four (24) month period following a change in control of the Company; provided further that the Date of Termination shall be extended by a notice of dispute only if such notice is given in good faith and the party giving such notice pursues the resolution of such dispute with reasonable diligence. Notwithstanding the pendency of any such dispute, the Company will continue to pay you your full compensation in effect when the notice giving rise to the dispute was given (including, but not limited to, base salary) and continue you as a participant in all compensation, benefit and insurance plans and programs in which you were participating when the notice giving rise to the dispute was given, until the dispute is finally resolved in accordance with this Subsection 3(v). Amounts paid under this Subsection 3(v) are in addition to all other amounts due under this Agreement and shall not be offset against or reduce any other amounts due under this Agreement.

4. Compensation Upon Termination or During Disability. Following a change in control of the Company, as defined by Subsection 2(i), upon termination of your employment or during a period of Disability you shall be entitled to the following benefits:

(i) During any period that you fail to perform your full-time duties with the Company as a result of incapacity due to physical or mental illness, you shall continue to receive your base salary at the rate in effect at the commencement of any such period, together with all compensation payable to you under the Pension Plan, Supplemental Plan, Annual Incentive Plan, Savings Plan and Nonqualified Savings Plan during such period, until this Agreement is terminated pursuant to Subsection 3(i) hereof. Thereafter, in the event your employment shall be terminated, your benefits shall be determined under the Company’s retirement, insurance and other compensation plans and programs then in effect in accordance with the terms of such plans and programs.

(ii) If your employment shall be terminated by the Company for Cause or by you other than for Good Reason, Disability, death or Retirement, the Company shall pay you your full base salary through the Date of Termination at the rate in effect at the time Notice of Termination is given, plus all other amounts to which you are entitled under any compensation plan of the Company at the time such payments are due, and the Company shall have no further obligations to you under this Agreement.

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(iii) If your employment by the Company shall be terminated (a) by the Company other than for Cause, Retirement or Disability, or (b) by you for Good Reason, then you shall be entitled to the compensation and benefits provided below:

(A) The Company shall pay you your full base salary through the Date of Termination at the rate in effect at the time Notice of Termination is given, plus all other amounts to which you are entitled under any compensation plan or program of the Company, at the time such payments are due, except as otherwise provided below.

(B) In lieu of any further salary payments to you for periods subsequent to the Date of Termination, the Company shall pay as severance pay to you a lump sum severance payment (together with the payments provided in paragraphs C, D and E below, the “Severance Payments”) equal to two times the sum of (x) your annual base salary in effect immediately prior to the occurrence of the circumstance giving rise to the Notice of Termination given in respect thereof, and (y) the greater of (I) your target award under the Annual Incentive Plan or similar successor plan for the year in which the Date of Termination occurs, or (II) the average annual amount of the Award paid to you pursuant to the Annual Incentive Plan or similar successor plan with respect to the five years immediately preceding that in which the Date of Termination occurs, such average annual amount being calculated by aggregating all such Awards paid with respect to such five years and dividing such aggregate amount by the number of years for which such an Award was actually paid to you.

(C) Notwithstanding any provision of the Annual Incentive Plan, the Company shall pay to you a lump sum amount under that plan at least equal to the sum of (x) any incentive compensation under the Annual Incentive Plan which has been allocated or awarded to you for a completed fiscal year or other measuring period preceding the Date of Termination but has not yet been paid, and (y) a pro rata portion to the Date of Termination for the current fiscal year or other measuring period of the amount equal to the Target Award percentage applicable to you under the Annual Incentive Plan or similar successor plan on the Date of Termination times your annual base salary then in effect.

(D) In lieu of shares of common stock of RTI (“RTI Shares”) issuable upon exercise of outstanding stock options granted to you under RTI’s stock option plans (including outstanding options previously granted to you under the Ryerson Tull 1996 Incentive Stock Plan (the “RT 1996 Stock Plan”), collectively, (“Options”)) (which Options shall be cancelled upon the making of the payment referred to below), you shall receive an amount in cash equal to the product of (i) the excess of (x) in the case of incentive stock options (as defined in section 422A of the Internal Revenue Code of 1986, as amended (the “Code”)) (“ISOs”), granted after the date of this Agreement (without regard to any renewal hereof), the closing price of RTI’s shares as reported on the New York Stock Exchange Composite Transactions on or nearest the Date of Termination, or in the case of all other Options (other than ISOs granted prior to the date of this Agreement (without regard to any renewal hereof)), the Change in Control Price (as defined below), over (y) the per share exercise price of each Option then held by you (whether or not then fully exercisable), times (ii) the number of RTI Shares covered by each such Option. For purposes of this Agreement, the “Change in Control Price” means: (1) with respect to a merger or consolidation of RTI described in Subsection 2(i)(C) in which the consideration per share of RTI’s common stock to be paid for the acquisition of shares of common stock specified in the agreement of merger or consolidation is all in

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cash, the highest such consideration per share; (2) with respect to a change in control of the Company by reason of an acquisition of voting securities described in Subsection 2(i)(A), the highest price per share for any share of RTI’s common stock paid by any holder of any of the securities representing 20% or more of the combined voting power of RTI giving rise to the change in control of the Company; and (3) with respect to a change in control of the Company by reason of a merger or consolidation of RTI (other than a merger or consolidation described in Clause (1) next above), stockholder approval of an agreement or plan described in Subsection 2(i)(D), a change in the composition of the Board described in Subsection 2(i)(B) or a change in control of the Company pursuant to Subsection 2(i)(E) (relating to mergers, consolidations and sales of securities or assets of a Related Company), the highest price per share of common stock reported on the New York Stock Exchange Composite Transactions (or, if such shares are not traded on the New York Stock Exchange, such other principal market on which such shares are traded) during the sixty (60) day period ending on the date the change in control of the Company occurs.

(E) To the extent not otherwise vested in accordance with the terms and conditions of the Incentive Stock Plans or the RT 1996 Stock Plan, you shall be fully vested in any restricted shares issued thereunder and be fully vested in any performance shares that you would have earned under the Incentive Stock Plans or the RT 1996 Stock Plan, as applicable, for the calendar year in which the change in control of the Company occurs had the applicable performance targets for such calendar year been satisfied with respect to such shares.

(F) The Company shall also pay to you all legal fees and expenses incurred by you as a result of such termination (including all such fees and expenses, if any, incurred in contesting or disputing any such termination or in seeking to obtain or enforce any right or benefit provided by this Agreement or in connection with any tax audit or proceeding to the extent attributable to the application of Section 4999 of the Code to any payment or benefit provided hereunder). Such payments shall be made within five (5) days after your request for payment accompanied with such evidence of fees and expenses incurred as the Company reasonably may require. You shall be entitled to select your legal counsel, and your rights to payment pursuant to this paragraph (F) shall not be affected by the final outcome of any dispute with the Company.

(G) In the event that you become entitled to any payments provided for hereinabove (the “Contract Payments”), if the Contract Payments or other portion of the Total Payments (as defined below) will be subject to the tax (the “Excise Tax”) imposed by Section 4999 of the Code, the Company shall pay to you, no later than the fifth day following the Date of Termination, an additional amount (the “Gross-Up Payment”) such that the net amount retained by you, after deduction of any Excise Tax on the Contract Payments and such other Total Payments and any federal and state and local income and other payroll taxes and Excise Tax upon the payment provided for by this paragraph (G), shall be equal to the Contract Payments and such other Total Payments.

(H) For purposes of determining whether any of the payments will be subject to the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits

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received or to be received by you in connection with a change in control of the Company or your termination of employment (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement with the Company, any person whose actions result in a change in control or any person affiliated with the Company or such person) payable pursuant to the terms of this Agreement or any other plan, arrangement or agreement with the Company, any person whose actions result in a change in control or any person affiliated with the Company or such person (together with the Contract Payments, the “Total Payments”), shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code and all “excess parachute payments” within the meaning of Section 280G(b)(l) of the Code shall be treated as subject to the Excise Tax unless in the opinion of tax counsel selected by RTI’s independent auditors and reasonably acceptable to you, such other payments or benefits (in whole or in part) do not constitute parachute payments, including by reason of Section 280G(b)(4)(A) of the Code or such excess parachute payments (in whole or in part) represent reasonable compensation for services actually rendered within the meaning of Section 280G(b)(4)(B) of the Code in excess of the base amount allocable to such reasonable compensation within the meaning of Section 280G(b)(3) of the Code, or are otherwise not subject to the Excise Tax, (ii) the amount of the Total Payments which shall be treated as subject to the Excise Tax shall be equal to the lesser of (A) the amount of the Total Payments or (B) the amount of excess parachute payments within the meaning of Section 280G(b)(l) of the Code (after applying clause (i) above), and (iii) the value of any noncash benefits or any deferred payment or benefit shall be determined by RTI’s independent auditors in accordance with the principles of Sections 280G(d)(3) and (4) of the Code. For purposes of determining the amount of the Gross-Up Payment, you shall be deemed to pay federal income taxes at the highest marginal rate of federal income taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest marginal rate of taxation in the state and locality of your residence on the Date of Termination, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes.

(I) In the event that the Excise Tax is subsequently determined to be less than the amount taken into account hereunder at the time of termination of your employment, you shall repay to the Company at the time that the amount of such reduction in Excise Tax is finally determined the portion of the Gross-Up Payment attributable to such reduction (plus the portion of the Gross-Up Payment attributable to the Excise Tax and federal and state and local income tax imposed on the Gross-Up Payment being repaid by you if such repayment results in a reduction in Excise Tax and/or a federal and state and local income tax deduction) plus interest on the amount of such repayment at the rate provided in Section 1274(b)(2)(B) of the Code. In the event that the Excise Tax is determined to exceed the amount taken into account hereunder at the time of the termination of your employment (including by reason of any payment the existence or amount of which cannot be determined at the time of the Gross-Up Payment), the Company shall make an additional gross-up payment in respect of such excess (plus any interest payable with respect to such excess) at the time that the amount of such excess is finally determined.

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(J) The payments provided for in paragraphs (B), (C) and (D) above, shall be made not later than the fifth day following the Date of Termination, provided, however, that if the amounts of such payments cannot be finally determined on or before such day, the Company shall pay to you on such day an estimate, as determined in good faith by the Company, of the minimum amount of such payments and shall pay the remainder of such payments (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code) as soon as the amount thereof can be determined but in no event later than the thirtieth day after the Date of Termination. In the event that the amount of the estimated payments exceeds the amount subsequently determined to have been due, such excess shall constitute a loan by the Company to you payable on the fifth day after demand by the Company (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code).

(iv) If your employment shall be terminated (A) by the Company other than for Cause, Retirement or Disability or (B) by you for Good Reason, then for a twenty-four (24) month period after such termination, the Company shall arrange to provide you with: (1) life, disability, accident and health insurance benefits substantially similar to those which you are receiving immediately prior to the Notice of Termination, (2) financial advisory services similar to those provided currently to executives of the Company, if any, and (3) outplacement services. Benefits otherwise receivable by you pursuant to this Subsection 4(iv) shall be reduced to the extent comparable benefits are actually received by you during the twenty-four (24) month period following your termination, and any such benefits actually received by you shall be reported to the Company. Any rights that you have to continuation of life, disability, accident or health coverage under applicable state or federal law shall be in addition to those provided under this Agreement.

(v) If your employment shall be terminated (A) by the Company other than for Cause, Retirement or Disability or (B) by you for Good Reason, then in addition to the retirement benefits to which you are entitled under the Pension Plan and Supplemental Plan or any successor plans thereto, the Company shall pay you in cash at the time and in the manner provided in paragraph (J) of Subsection 4(iii), a lump sum equal to the excess of (x) the actuarial equivalent of the retirement pension (taking into account any early retirement subsidy associated therewith and determined as a straight life annuity commencing at age sixty-five (65) or any earlier date, but in no event earlier than the second anniversary of the Date of Termination whichever annuity yields a greater benefit) which you would have accrued under the terms of the Pension Plan and Supplemental Plan (without regard to any amendments to any such plans made subsequent to a change in control of the Company and on or prior to the Date of Termination, which amendment adversely affects in any manner the computation of retirement benefits thereunder), determined as if you were fully vested thereunder and had accumulated (after the Date of Termination) twenty-four (24) additional months of age and service credit thereunder at the higher of the rate of average compensation during the twelve (12) months prior to the change in control of the Company or the rate of average compensation used to calculate your benefits under such plans immediately preceding the Date of Termination, over (y) the actuarial equivalent of the retirement pension (taking into account any early retirement subsidy associated therewith and determined as a straight life annuity commencing at age sixty-five (65) or any earlier date, but in no event earlier than the Date of Termination whichever annuity yields a greater benefit) which you had then accrued pursuant to the provisions of the Pension Plan and

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the Supplemental Plan. For purposes of this Subsection 4(v), “actuarial equivalent” shall be determined using the same assumptions utilized under the Pension Plan for purposes of determining alternative forms of benefits immediately prior to the change in control of the Company.

(vi) You shall not be required to mitigate the amount of any payment provided for in this Section 4 by seeking other employment or otherwise, nor shall the amount of any payment or benefit provided for in this Section 4 be reduced by any compensation earned by you as the result of employment by another employer, by retirement benefits, by offset against any amount claimed to be owed by you to the Company, or otherwise, except as provided in Subsection 4(iv).

(vii) In addition to all other amounts payable to you under this Section 4, you shall be entitled to receive all benefits payable to you under the Pension Plan, the Savings Plan, Supplemental Plan and Nonqualified Savings Plan and any other plan or agreement relating to retirement benefits.

5. Successors; Binding Agreement. (i) RTI will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of RTI to expressly assume and agree to perform this Agreement in the same manner and to the same extent that RTI or the Company would be required to perform it if no such succession had taken place. Failure of RTI to obtain such assumption and agreement prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle you to compensation from the Company in the same amount and on the same terms as you would be entitled to hereunder if you terminate your employment for Good Reason following a change in control of the Company, except that for purposes of implementing the foregoing, the date on which any such succession becomes effective shall be deemed the Date of Termination. In the event a successor of RTI assumes and agrees to perform this Agreement, by operation of law or otherwise, the term “RTI”, as used in this Agreement, shall mean such successor and the term “Company” shall mean, collectively, such successor and the affiliates of such successor.

(ii) This Agreement shall inure to the benefit of and be enforceable by your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If you should die while any amount would still be payable to you hereunder if you had continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to your devisee, legatee or other designee or, if there is no such designee, to your estate.

6. Notice. For the purpose of this Agreement, notices and all other communications provided for in the Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States registered mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth on the first page of this Agreement, provided that all notice to the Company shall be directed to the attention of the Board with a copy to the Secretary of RTI, or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notice of change of address shall be effective only upon receipt.

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7. Miscellaneous. No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by you and such officer as may be specifically designated by the Board. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not expressly set forth in this Agreement. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of Illinois. All references to sections of the Exchange Act or the Code shall be deemed also to refer to any successor provisions to such sections. Any payments provided for hereunder shall be paid net of any applicable withholding required under federal, state or local law. The obligations of RTI and the Company under Section 4 shall survive the expiration of the term of this Agreement.

8. Validity. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

9. Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

10. Settlement of Disputes; Arbitration. All claims by you for benefits under this Agreement shall be directed to and determined by the Board and shall be in writing. Any denial by the Board of a claim for benefits under this Agreement shall be delivered to you in writing and shall set forth the specific reasons for the denial and the specific provisions of this Agreement relied upon. The Board shall afford a reasonable opportunity to you for a review of the decision denying a claim and shall further allow you to appeal to the Board a decision of the Board within sixty (60) days after notification by the Board that your claim has been denied. Any further dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration in Chicago, Illinois, in accordance with the rules of the American Arbitration Association then in effect, provided, however, that the evidentiary standards set forth in this Agreement shall apply. Judgment may be entered on the arbitrator’s award in any court having jurisdiction; provided, however, that you shall be entitled to seek specific performance of your right to be paid until the Date of Termination during the pendency of any dispute or controversy arising under or in connection with this Agreement.

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If this letter sets forth our agreement on the subject matter hereof, kindly sign and return to RTI the enclosed copy of this letter which will then constitute our agreement on this subject.

Sincerely,
RYERSON TULL, INC.
By
	Vice President - Human Resources

Agreed to this                                                       day of                                                  , 2003

(Signature)

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EX-10.18

Exhibit 10.18

Schedule to Form of Change in Control Agreement between

Ryerson Tull, Inc. and the following parties:

James M. Delaney

Stephen E. Makarewicz

EX-10.25

Exhibit 10.25

Schedule to Form of Indemnification Agreement between

Ryerson Tull, Inc. and the following parties:

Jameson A. Baxter

Richard G. Cline

Gary L. Crittenden

James A. Henderson

Gregory P. Josefowicz

Jerry K. Pearlman

Neil S. Novich

Ronald L. Thompson

Martha Miller de Lombera

Jay M. Gratz

Gary J. Niederpruem

James M. Delaney

Stephen E. Makarewicz

EX-21

Exhibit 21

SUBSIDIARIES OF RYERSON TULL, INC.

The subsidiaries of Ryerson Tull, Inc. (other than certain subsidiaries which, considered in the aggregate as a single subsidiary, do not constitute a significant subsidiary), four of which are incorporated in the State of Delaware and one of which is incorporated in the State of Georgia, as noted below, and each of which is wholly owned by Ryerson Tull, Inc., are as follows:

Joseph T. Ryerson & Son, Inc.

(a Delaware corporation)

J. M. Tull Metals Company, Inc.

(a Georgia corporation)

Ryerson Tull International, Inc.

(a Delaware corporation)

Ryerson Tull Procurement Corporation

(a Delaware corporation)

EX-23

EXHIBIT 23

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in the Registration Statements on Form S-3 (No. 33-59161, No. 33-62897 and No. 333-59009) and in the Registration Statements on Form S-8 (No. 33-59783, No. 33-48770, No. 33-13292, No. 33-32504, No. 333-06977, No. 333-06989, No. 333-78429, No. 333-62382 and No. 333-88476), of Ryerson Tull, Inc. of our report dated February 18, 2004 relating to the financial statements and financial statement schedule, which appear in this Form 10-K.

PricewaterhouseCoopers LLP

Chicago, Illinois

February 27, 2004

EX-24

Exhibit 24

RYERSON TULL, INC.

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director and(or) officer of Ryerson Tull, Inc., a Delaware corporation, do hereby nominate, constitute and appoint Jay M. Gratz, Neil S. Novich, Terence R. Rogers and Joyce E. Mims, or any one or more of them, my true and lawful attorneys and agents to do any and all acts and things and execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable to enable said Ryerson Tull, Inc. to comply with the Securities Exchange Act of 1934, as amended, and any requirements of the Securities and Exchange Commission in respect thereof, in connection with the preparation and filing of the Annual Report on Form 10-K of said Ryerson Tull, Inc. for the fiscal year ended December 31, 2003, including specifically, but without limitation thereof, full power and authority to sign my name as a director and(or) officer of said Ryerson Tull, Inc. to said Annual Report on Form 10-K and any amendment thereto, hereby ratifying and confirming all that said attorneys and agents, or any of them, shall do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, I have hereunto set my hand this 12^th day of February, 2004.

/s/    JAMESON A. BAXTER        

Jameson A. Baxter

RYERSON TULL, INC.

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director and(or) officer of Ryerson Tull, Inc., a Delaware corporation, do hereby nominate, constitute and appoint Jay M. Gratz, Neil S. Novich, Terence R. Rogers and Joyce E. Mims, or any one or more of them, my true and lawful attorneys and agents to do any and all acts and things and execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable to enable said Ryerson Tull, Inc. to comply with the Securities Exchange Act of 1934, as amended, and any requirements of the Securities and Exchange Commission in respect thereof, in connection with the preparation and filing of the Annual Report on Form 10-K of said Ryerson Tull, Inc. for the fiscal year ended December 31, 2003, including specifically, but without limitation thereof, full power and authority to sign my name as a director and(or) officer of said Ryerson Tull, Inc. to said Annual Report on Form 10-K and any amendment thereto, hereby ratifying and confirming all that said attorneys and agents, or any of them, shall do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, I have hereunto set my hand this 4^th day of February, 2004.

/s/    RICHARD G. CLINE        

Richard G. Cline

RYERSON TULL, INC.

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director and(or) officer of Ryerson Tull, Inc., a Delaware corporation, do hereby nominate, constitute and appoint Jay M. Gratz, Neil S. Novich, Terence R. Rogers and Joyce E. Mims, or any one or more of them, my true and lawful attorneys and agents to do any and all acts and things and execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable to enable said Ryerson Tull, Inc. to comply with the Securities Exchange Act of 1934, as amended, and any requirements of the Securities and Exchange Commission in respect thereof, in connection with the preparation and filing of the Annual Report on Form 10-K of said Ryerson Tull, Inc. for the fiscal year ended December 31, 2003, including specifically, but without limitation thereof, full power and authority to sign my name as a director and(or) officer of said Ryerson Tull, Inc. to said Annual Report on Form 10-K and any amendment thereto, hereby ratifying and confirming all that said attorneys and agents, or any of them, shall do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, I have hereunto set my hand this 6^th day of February, 2004.

/s/    GARY L. CRITTENDEN        

Gary L. Crittenden

RYERSON TULL, INC.

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director and(or) officer of Ryerson Tull, Inc., a Delaware corporation, do hereby nominate, constitute and appoint Jay M. Gratz, Neil S. Novich, Terence R. Rogers and Joyce E. Mims, or any one or more of them, my true and lawful attorneys and agents to do any and all acts and things and execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable to enable said Ryerson Tull, Inc. to comply with the Securities Exchange Act of 1934, as amended, and any requirements of the Securities and Exchange Commission in respect thereof, in connection with the preparation and filing of the Annual Report on Form 10-K of said Ryerson Tull, Inc. for the fiscal year ended December 31, 2003, including specifically, but without limitation thereof, full power and authority to sign my name as a director and(or) officer of said Ryerson Tull, Inc. to said Annual Report on Form 10-K and any amendment thereto, hereby ratifying and confirming all that said attorneys and agents, or any of them, shall do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, I have hereunto set my hand this 9^th day of February, 2004.

/s/    JAMES A. HENDERSON        

James A. Henderson

RYERSON TULL, INC.

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director and(or) officer of Ryerson Tull, Inc., a Delaware corporation, do hereby nominate, constitute and appoint Jay M. Gratz, Neil S. Novich, Terence R. Rogers and Joyce E. Mims, or any one or more of them, my true and lawful attorneys and agents to do any and all acts and things and execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable to enable said Ryerson Tull, Inc. to comply with the Securities Exchange Act of 1934, as amended, and any requirements of the Securities and Exchange Commission in respect thereof, in connection with the preparation and filing of the Annual Report on Form 10-K of said Ryerson Tull, Inc. for the fiscal year ended December 31, 2003, including specifically, but without limitation thereof, full power and authority to sign my name as a director and(or) officer of said Ryerson Tull, Inc. to said Annual Report on Form 10-K and any amendment thereto, hereby ratifying and confirming all that said attorneys and agents, or any of them, shall do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, I have hereunto set my hand this 12^th day of February, 2004.

/s/    GREGORY P. JOSEFOWICZ        

Gregory P. Josefowicz

RYERSON TULL, INC.

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director and(or) officer of Ryerson Tull, Inc., a Delaware corporation, do hereby nominate, constitute and appoint Jay M. Gratz, Neil S. Novich, Terence R. Rogers and Joyce E. Mims, or any one or more of them, my true and lawful attorneys and agents to do any and all acts and things and execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable to enable said Ryerson Tull, Inc. to comply with the Securities Exchange Act of 1934, as amended, and any requirements of the Securities and Exchange Commission in respect thereof, in connection with the preparation and filing of the Annual Report on Form 10-K of said Ryerson Tull, Inc. for the fiscal year ended December 31, 2003, including specifically, but without limitation thereof, full power and authority to sign my name as a director and(or) officer of said Ryerson Tull, Inc. to said Annual Report on Form 10-K and any amendment thereto, hereby ratifying and confirming all that said attorneys and agents, or any of them, shall do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, I have hereunto set my hand this 12^th day of February, 2004.

/s/    MARTHA MILLER DE LOMBERA        

Martha Miller de Lombera

RYERSON TULL, INC.

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director and(or) officer of Ryerson Tull, Inc., a Delaware corporation, do hereby nominate, constitute and appoint Jay M. Gratz, Terence R. Rogers and Joyce E. Mims, or any one or more of them, my true and lawful attorneys and agents to do any and all acts and things and execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable to enable said Ryerson Tull, Inc. to comply with the Securities Exchange Act of 1934, as amended, and any requirements of the Securities and Exchange Commission in respect thereof, in connection with the preparation and filing of the Annual Report on Form 10-K of said Ryerson Tull, Inc. for the fiscal year ended December 31, 2003, including specifically, but without limitation thereof, full power and authority to sign my name as a director and(or) officer of said Ryerson Tull, Inc. to said Annual Report on Form 10-K and any amendment thereto, hereby ratifying and confirming all that said attorneys and agents, or any of them, shall do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, I have hereunto set my hand this 12^th day of February, 2004.

/s/    NEIL S. NOVICH        

Neil S. Novich

RYERSON TULL, INC.

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director and(or) officer of Ryerson Tull, Inc., a Delaware corporation, do hereby nominate, constitute and appoint Jay M. Gratz, Neil S. Novich, Terence R. Rogers and Joyce E. Mims, or any one or more of them, my true and lawful attorneys and agents to do any and all acts and things and execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable to enable said Ryerson Tull, Inc. to comply with the Securities Exchange Act of 1934, as amended, and any requirements of the Securities and Exchange Commission in respect thereof, in connection with the preparation and filing of the Annual Report on Form 10-K of said Ryerson Tull, Inc. for the fiscal year ended December 31, 2003, including specifically, but without limitation thereof, full power and authority to sign my name as a director and(or) officer of said Ryerson Tull, Inc. to said Annual Report on Form 10-K and any amendment thereto, hereby ratifying and confirming all that said attorneys and agents, or any of them, shall do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, I have hereunto set my hand this 4^th day of February, 2004.

/s/    JERRY K. PEARLMAN        

Jerry K. Pearlman

RYERSON TULL, INC.

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director and(or) officer of Ryerson Tull, Inc., a Delaware corporation, do hereby nominate, constitute and appoint Jay M. Gratz, Neil S. Novich, Terence R. Rogers and Joyce E. Mims, or any one or more of them, my true and lawful attorneys and agents to do any and all acts and things and execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable to enable said Ryerson Tull, Inc. to comply with the Securities Exchange Act of 1934, as amended, and any requirements of the Securities and Exchange Commission in respect thereof, in connection with the preparation and filing of the Annual Report on Form 10-K of said Ryerson Tull, Inc. for the fiscal year ended December 31, 2003, including specifically, but without limitation thereof, full power and authority to sign my name as a director and(or) officer of said Ryerson Tull, Inc. to said Annual Report on Form 10-K and any amendment thereto, hereby ratifying and confirming all that said attorneys and agents, or any of them, shall do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, I have hereunto set my hand this 15^th day of February, 2004.

/s/    RONALD L. THOMPSON        

Ronald L. Thompson

EX-31.1

EXHIBIT 31.1

CERTIFICATE OF THE

PRINCIPAL EXECUTIVE OFFICER

I, Neil S. Novich, as Chairman, President & Chief Executive Officer, certify that:

1. I have reviewed this annual report on Form 10-K of Ryerson Tull, Inc.;

2. Based on my knowledge, this 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 report;

3. Based on my knowledge, the financial statements, and other financial information included in this 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 report;

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

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, 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 report is being prepared; and

b) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c) disclosed in this report any change in the registrant’s internal controls over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s last fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal controls over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal controls over financial reporting, 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 and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; 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 over financial reporting.

Date:	February 27, 2004
Signature:	/s/    NEIL S. Novich
	Neil S. Novich
	Chairman, President & Chief Executive Officer
	(Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATE OF THE

PRINCIPAL FINANCIAL OFFICER

I, Jay M. Gratz, as Executive Vice President and Chief Financial Officer, certify that:

1. I have reviewed this annual report on Form 10-K of Ryerson Tull, Inc.;

2. Based on my knowledge, this 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 report;

3. Based on my knowledge, the financial statements, and other financial information included in this 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 report;

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

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, 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 report is being prepared; and

b) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c) disclosed in this report any change in the registrant’s internal controls over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s last fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal controls over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal controls over financial reporting, 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 and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; 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 over financial reporting.

Date:	February 27, 2004
Signature:	/s/    JAy M. Gratz
	Jay M. Gratz
	Executive Vice President and Chief Financial Officer
	(Principal Financial Officer)

EX-32.1

EXHIBIT 32.1

[LETTERHEAD]

Written Statement of the Chief Executive Officer

I, Neil S. Novich, as Chairman, President and Chief Executive Officer of Ryerson Tull, Inc. (the “Company”), state and certify that this Form 10-K Annual Report for the period ended December 31, 2003, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in this Form 10-K Annual Report for the period ended December 31, 2003, fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/    NEIL S. NOVICH        

Neil S. Novich

Chairman, President & Chief Executive Officer

(Principal Executive Officer)

February 27, 2004

EX-32.2

EXHIBIT 32.2

[LETTERHEAD]

Written Statement of the Chief Financial Officer

I, Jay M. Gratz, as Executive Vice President and Chief Financial Officer of Ryerson Tull, Inc. (the “Company”), state and certify that this Form 10-K Annual Report for the period ended December 31, 2003, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in this Form 10-K Annual Report for the period ended December 31, 2003, fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/    JAY M. GRATZ        

Jay M. Gratz

Executive Vice President & Chief Financial Officer

(Principal Financial Officer)

February 27, 2004