-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, G+MC/ZXPJh5FK5p1X4/i3OdivKbjTAwWCmF62+G0d4nTf7id2Cv5SSWnHuuRIeqk T1EC50SNAmwibZEYybJH/w== 0000084278-97-000006.txt : 19970616 0000084278-97-000006.hdr.sgml : 19970616 ACCESSION NUMBER: 0000084278-97-000006 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19970430 FILED AS OF DATE: 19970613 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: ROANOKE ELECTRIC STEEL CORP CENTRAL INDEX KEY: 0000084278 STANDARD INDUSTRIAL CLASSIFICATION: STEEL WORKS, BLAST FURNACES ROLLING MILLS (COKE OVENS) [3312] IRS NUMBER: 540585263 STATE OF INCORPORATION: VA FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-02389 FILM NUMBER: 97623700 BUSINESS ADDRESS: STREET 1: P O BOX 13948 CITY: ROANOKE STATE: VA ZIP: 24038-3948 BUSINESS PHONE: 5403421831 MAIL ADDRESS: STREET 1: PO BOX 13948 CITY: ROANOKE STATE: VA ZIP: 24038-3948 10-Q 1 2ND QUARTER 1997 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (x) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended April 30, 1997 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 number 0-2389 ROANOKE ELECTRIC STEEL CORPORATION (Exact name of Registrant as specified in its charter) Virginia 54-0585263 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 102 Westside Blvd., N.W., Roanoke, Virginia 24017 (Address of principal executive offices) (Zip Code) (540) 342-1831 (Registrant's telephone number, including area code) N/A (Former name, former address and former fiscal year, if changed since last report) 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, and (2) has been subject to such filing requirements for the past 90 days. Yes x No Indicate the number of shares outstanding of each of the Registrant's classes of common stock, as of April 30, 1997. 7,501,097 Shares outstanding ROANOKE ELECTRIC STEEL CORPORATION FORM 10-Q CONTENTS Page 1. Part I - Financial Information 3 - 10 Item 1. Financial Statements a. Consolidated Balance Sheets 3 b. Consolidated Statements of Earnings 4 c. Consolidated Statements of Cash Flows 5 d. Notes to Consolidated Financial Statements 6 - 7 e. Independent Accountants' Report 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 - 10 2. Part II - Other Information 11 - 12 Item 1. Legal Proceedings 11 Item 4. Submission of Matters to a Vote of Security Holders 11 Item 5. Other Information 11 Item 6. Exhibits and Reports on Form 8-K 12 3. Signatures 13 4. Exhibit Index pursuant to Regulation S-K 14 5. Exhibits a. By-Laws 15 b. Financial Data Schedule 16 PART I - FINANCIAL INFORMATION ITEM 1 - FINANCIAL STATEMENTS ROANOKE ELECTRIC STEEL CORPORATION Consolidated Balance Sheets ASSETS (Unaudited) April 30, October 31, 1997 1996 CURRENT ASSETS Cash and cash equivalents $ 5,787,533 $ 1,038,689 Investments 6,439,678 6,059,853 Accounts receivable 35,643,594 40,479,798 Inventories 33,154,516 34,314,899 Prepaid expenses 1,675,368 651,013 Deferred income taxes 1,039,542 1,039,542 Total current assets 83,740,231 83,583,794 PROPERTY, PLANT AND EQUIPMENT Land 4,291,522 4,291,522 Buildings 17,957,386 17,889,855 Other property and equipment 125,171,122 123,215,697 Assets under construction 2,582,457 1,054,026 Total 150,002,487 146,451,100 Less--accumulated depreciation 67,907,895 63,216,681 Property, plant and equipment, net 82,094,592 83,234,419 OTHER ASSETS 193,435 197,688 TOTAL $ 166,028,258 $ 167,015,901 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Current portion of long-term debt $ 4,250,000 $ 4,250,000 Accounts payable 13,009,747 10,977,510 Dividends payable 900,132 904,944 Employees' taxes withheld 221,810 284,466 Accrued profit sharing contribution 1,879,270 3,911,957 Accrued wages and expenses 2,228,468 2,745,159 Accrued income taxes 944,806 879,569 Total current liabilities 23,434,233 23,953,605 LONG-TERM DEBT Notes payable 34,916,667 39,541,666 Less--current portion 4,250,000 4,250,000 Total long-term debt 30,666,667 35,291,666 POSTRETIREMENT LIABILITIES 866,824 742,839 DEFERRED INCOME TAXES 13,016,700 12,594,700 STOCKHOLDERS' EQUITY Common stock--no par value--authorized 20,000,000 shares, issued 9,007,040 shares in 1997 and 8,994,140 in 1996 2,036,646 1,916,796 Capital in excess of stated value 9,349,429 9,349,429 Retained earnings 96,342,604 92,097,683 Total 107,728,679 103,363,908 Less--treasury stock, 1,505,943 shares in 1997 and 1,452,943 in 1996 -- at cost 9,684,845 8,930,817 Total stockholders' equity 98,043,834 94,433,091 TOTAL $ 166,028,258 $ 167,015,901 The accompanying notes to consolidated financial statements are an integral part of this statement. ROANOKE ELECTRIC STEEL CORPORATION Consolidated Statements of Earnings
(Unaudited) (Unaudited) Three Months Ended Six Months Ended April 30, April 30, 1997 1996 1997 1996 SALES $ 61,299,896 $ 58,144,393 $ 119,651,630 $ 116,573,610 COST OF SALES 49,448,698 47,080,758 98,469,622 93,554,676 GROSS EARNINGS 11,851,198 11,063,635 21,182,008 23,018,934 OTHER OPERATING EXPENSES Administrative 4,536,889 4,052,091 8,359,104 7,829,976 Interest, net 423,161 487,156 889,696 889,418 Profit sharing 1,134,597 923,924 1,879,270 2,161,989 Total 6,094,647 5,463,171 11,128,070 10,881,383 EARNINGS BEFORE INCOME TAXES 5,756,551 5,600,464 10,053,938 12,137,551 INCOME TAX EXPENSE 2,297,481 2,234,710 4,010,194 4,843,384 NET EARNINGS $ 3,459,070 $ 3,365,754 $ 6,043,744 $ 7,294,167 Weighted average number of common shares outstanding 7,495,215 8,058,050 7,499,185 8,067,368 Net earnings per share of common stock $ 0.47 $ 0.41 $ 0.81 $ 0.90 Cash dividends per share of common stock $ 0.12 $ 0.11 $ 0.24 $ 0.22 The accompanying notes to consolidated financial statements are an integral part of this statement.
ROANOKE ELECTRIC STEEL CORPORATION Consolidated Statements of Cash Flows
(Unaudited) Six Months Ended April 30, 1997 1996 CASH FLOWS FROM OPERATING ACTIVITIES Net earnings $ 6,043,744 $ 7,294,167 Adjustments to reconcile net earnings to net cash provided by operating activities: Postretirement liabilities 123,985 124,124 Depreciation and amortization 4,708,780 3,938,276 Loss on sale of investments and property, plant and equipment 4,307 24,037 Deferred income taxes 422,000 (42,000) Changes in assets and liabilities which provided (used) cash, exclusive of changes shown seperately 4,457,672 (4,405,199) Net cash provided by operating activities 15,760,488 6,933,405 CASH FLOWS FROM INVESTING ACTIVITIES Expenditures for property, plant and equipment (3,557,142) (9,304,183) Proceeds from sale of property, plant and equipment - 16,653 Purchase of investments (391,689) (2,043,359) Other - 98,158 Net cash used in investing activities (3,948,831) (11,232,731) CASH FLOWS FROM FINANCING ACTIVITIES Decrease in notes payable - (11,000,000) Cash dividends (1,798,824) (1,743,835) Decrease in dividends payable (4,812) (32,807) Proceeeds from exercise of common stock options 119,850 60,793 Payment of long-term debt (4,624,999) (11,562,499) Proceeds from long-term debt - 34,500,000 Repurchase of common stock (754,028) (4,412,562) Net cash provided by (used in) financing activities (7,062,813) 5,809,090 NET INCREASE IN CASH AND CASH EQUIVALENTS 4,748,844 1,509,764 CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 1,038,689 6,999,644 CASH AND CASH EQUIVALENTS, END OF PERIOD $ 5,787,533 $ 8,509,408 CHANGES IN ASSETS AND LIABILITIES WHICH PROVIDED (USED) CASH, EXCLUSIVE OF CHANGES SHOWN SEPARATELY (Increase) decrease in accounts receivable $ 4,836,204 $ 7,486,226 (Increase) decrease in inventories 1,160,383 (5,414,095) (Increase) decrease in prepaid expenses (1,024,355) (4,145) Increase (decrease) in accounts payable 2,032,237 (3,516,713) Increase (decrease) in employees' taxes withheld (62,656) 97,563 Increase (decrease) in accrued profit sharing contribution (2,032,687) (2,241,042) Increase (decrease) in accrued wages and expenses (516,691) (257,138) Increase (decrease) in accrued income taxes 65,237 (555,855) Total $ 4,457,672 $ (4,405,199) SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Cash paid during the period for: Interest $ 1,244,026 $ 882,130 Income taxes $ 3,522,958 $ 5,441,240
The accompanying notes to consolidated financial statements are an integral part of this statement. ROANOKE ELECTRIC STEEL CORPORATION Notes to Consolidated Financial Statements April 30, 1997 Note 1. In the opinion of the Registrant, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the financial position as of April 30, 1997 and the results of operations for the three months and six months ended April 30, 1997 and 1996 and cash flows for the six months ended April 30, 1997 and 1996. Note 2. Inventories include the following major classifications: (Unaudited) April 30, October 31, 1997 1996 Scrap Steel $ 3,758,962 $ 5,313,335 Melt Supplies 1,846,503 2,416,879 Billets 5,752,832 7,103,342 Mill Supplies 3,056,774 3,085,749 Finished Steel 18,739,445 16,395,594 Total Inventories $ 33,154,516 $ 34,314,899 Note 3. In October 1995, the Financial Accounting Standards Board issued SFAS No. 123, "Accounting for Stock-Based Compensation." SFAS No. 123 is effective for transactions entered into in fiscal years that begin after December 15, 1995. This statement adopts a "fair value based method" of accounting for employee stock option plans or similar stock-based compensation plans. Under the fair value based method, compensation cost is measured at the grant date based on the fair value of the award and is recognized over the service or vesting period. The statement does allow entities to continue to measure compensation using the "intrinsic value based method" of Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" (APB No. 25), provided that they make pro forma disclosures on net income and earnings per common share as if the fair value based method of accounting had been applied. The Company has elected to continue to follow APB No. 25. Note 4. In February 1997, the Financial Accounting Standards Board issued SFAS No. 128, "Earnings per Share", which changes the method of calculating earnings per share. SFAS No. 128 requires the presentation of "basic" earnings per share and "diluted" earnings per share on the face of the income statement. Basic earnings per share is computed by dividing the net income available to common shareholders by the weighted average shares of outstanding common stock. The calculation of diluted earnings per share is similar to basic earnings per share except that the denominator includes dilutive common stock equivalents such as stock options and warrants. The statement is effective for financial statements for periods ending after December 31, 1997, and early adoption is not permitted. The pro forma basic earnings per share and diluted earnings per share calculated in accordance with SFAS No. 128 are as follows: (Unaudited) (Unaudited) Three Months Six Months Ended Ended April 30, April 30, 1997 1996 1997 1996 Pro forma basic earnings per share $ 0.47 $ 0.41 $ 0.81 $ 0.90 Pro forma diluted earnings per share $ 0.46 $ 0.41 $ 0.80 $ 0.90 INDEPENDENT ACCOUNTANTS' REPORT DELOITTE & TOUCHE LLP Suite 1401 Telephone: (910) 721-2300 500 West Fifth Street Facsimile: (910) 721-2301 Winston-Salem, North Carolina 27152 Board of Directors Roanoke Electric Steel Corporation: We have reviewed the accompanying consolidated balance sheet of Roanoke Electric Steel Corporation and subsidiaries as of April 30, 1997, and the related consolidated statements of earnings and cash flows for the three-month and six-month periods ended April 30, 1997 and 1996. These financial statements are the responsibility of the Corporation's management. We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and of making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to such consolidated financial statements for them to be in conformity with generally accepted accounting principles. We have previously audited, in accordance with generally accepted auditing standards, the consolidated balance sheet of Roanoke Electric Steel Corporation and subsidiaries as of October 31, 1996, and the related consolidated statements of earnings, stockholders' equity, and cash flows for the year then ended (not presented herein); and in our report dated November 21, 1996, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of October 31, 1996 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived. Deloitte & Touche LLP June 2, 1997 Deloitte Touche Tohmatsu International PART I - ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following is management's discussion and analysis of certain significant factors which have affected the Company's earnings during the periods included in the accompanying consolidated statements of earnings. A summary of the period to period changes in the principal items included in the consolidated statements of earnings is shown below: Comparison of Increases (Decreases) Three Months Ended Six Months Ended April 30, April 30, 1997 and 1996 1997 and 1996 Amount Percent Amount Percent Sales 3,155,503 5.4 3,078,020 2.6 Cost of Sales 2,367,940 5.0 4,914,946 5.3 Administrative Expenses 484,798 12.0 529,128 6.8 Interest Expense (63,995) (13.1) 278 0.0 Profit Sharing Expense 210,673 22.8 (282,719) (13.1) Earnings before Income Taxes 156,087 2.8 (2,083,613) (17.2) Income Tax Expense 62,771 2.8 (833,190) (17.2) Net Earnings 93,316 2.8 (1,250,423) (17.1) Sales increased for the six months compared as a result of increases in tons shipped of both merchant bar and fabricated products, even though selling prices declined for all product classes while billet shipments were flat. The increase in sales for the three months compared was due mainly to increased tons shipped for all product classes and improved selling prices for bar products, in spite of reduced selling prices for fabricated products and billets. Merchant bar shipments increased during both periods compared as competition began to ease during the quarter and order levels and backlogs increased. In spite of the competitive conditions in the construction industry, fabricated product shipments improved as a result of a severe winter last year which delayed shipments during both periods. Selling prices for bar products improved for the quarter with more favorable competitive conditions and demand, which prompted industry-wide price increases, but coming too late to offset earlier price reductions resulting in the slight drop in six month comparable prices. The higher billet shipments for the quarter were due to improved domestic demand. Billet selling prices declined in both periods with the downward trend in scrap prices, which normally trigger changes in billet pricing. The lower selling prices for fabricated products were due to the increased competition. Cost of sales increased for both the six month and three month periods compared primarily due to the increased tons shipped of merchant bar and fabricated products, in spite of a drop in the cost of scrap steel, our main raw material. The increased three month billet shipments also contributed to the higher costs for the quarter. Gross profit as a percentage of sales declined from 19.7% to 17.7% for the six months compared due mainly to the lower selling prices for all product classes, in spite of the lower scrap prices. Gross profit as a percentage of sales increased from 19.0% to 19.3% for the three months compared primarily as a result of the higher selling prices for mill products, the increased production levels for merchant bar and fabricated products which reduced unit costs for fixed expenses, and the lower scrap costs, which more than offset the lower selling prices for fabricated products and billets. Both gross profit and net earnings declined for the six months compared, due mainly to the reduced margins in spite of the improved shipment levels. For the three months compared, the increase in gross profit margins for mill products at the higher shipment levels was the primary reason for the increase in both gross profit and net earnings. Administrative expenses increased in both periods compared mainly as a result of higher insurance expenses. Executive and other compensation increased for the quarter, but decreased for the six months compared, in accordance with various incentive arrangements based on earnings and production. Administrative expenses, as a percentage of sales, were relatively constant for the periods compared. Interest expense was flat for the six months compared as lower interest rates and increased capitalized interest and interest income offset higher average borrowings. Interest expense decreased for the three months compared due to the reduction in interest rates and average borrowings, which more than offset the decrease in capitalized interest and interest income. Profit sharing expense, computed as a percentage of pre-tax income, declined for the six months as a result of lower earnings and increased for the three months due to improved earnings. The effective income tax rate was relatively constant for both periods compared. Working capital increased $675,809 during the period to $60,305,998 mainly as a result of working capital provided from operations exceeding capital expenditures, dividends, debt maturities and repurchases of common stock amounting to $3,557,142, $1,798,824, $4,624,999 and $754,028, respectively. The current ratio of 3.6 to 1 and the quick ratio of 2.0 to 1 both indicate very sound liquidity and a healthy financial condition. In addition, cash, cash equivalents and investments increased $5,128,669 during the period to $12,227,211. Our $30,000,000 revolver, unused at April 30, 1997, provides the liquidity and capital resources necessary to maintain our competitive position and ensure future growth. The Company last year approved a common stock buy-back plan. Currently, 609,200 shares of 750,000 authorized have been repurchased at a cost of $8,489,977. At April 30, 1997, commitments for the purchase of property, plant and equipment of $1,636,158, and the repurchase of the remaining 140,800 shares will affect future liquidity. Funding for these needs will come from internally generated funds and the use of the revolver mentioned above. During the first half of the year, the ratio of debt to equity improved to .69 to 1, and the percentage of long-term debt to total capital decreased from 27.2% to 23.8%, due to current maturities reducing long-term debt by $4,624,999, while stockholders' equity increased as net earnings of $6,043,744 exceeded dividends of $1,798,824 and common stock repurchases of $754,028. From time to time, the Company may publish forward-looking statements relating to such matters as anticipated financial performance, business prospects, technological developments, new products, research and development activities and similar matters. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. In order to comply with the terms of the safe harbor, the Company notes that a variety of factors could cause the Company's actual results and experience to differ materially from the anticipated results or other expectations expressed in the Company's forward-looking statements. The risks and uncertainties that may affect the operations, performance, development and results of the Company's business include economic and industry conditions, availability and prices of supplies, prices of steel products, competition, governmental regulations, interest rates, inflation, labor relations, environmental concerns, and others. PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS. To the best of Registrant's information and belief no new legal proceedings were instituted against Registrant or any of its wholly-owned subsidiaries during the period covered by this report and there was no material development in or termination of the legal proceedings reported earlier by Registrant on Form 10-K for fiscal year ended October 31, 1996 and Form 10-Q for the quarter ended January 31, 1997, as previously filed with the commission. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. On February 18, 1997, the Annual Meeting of Shareholders was held and the following persons were elected as Class A directors of the Registrant, with terms expiring in 2000: Authority Not Director For Withheld Voted George B. Cartledge, Jr. 6,672,482 8,084 822,631 Thomas L. Robertson 6,671,569 8,997 822,631 Donald G. Smith 6,672,986 7,580 822,631 The following persons continued to serve as Class B and Class C directors of the Registrant after the annual meeting: Class B directors, with terms expiring in 1998 Frank A. Boxley T.A. Carter William L. Neal Class C directors, with terms expiring in 1999 Charles I. Lunsford, II Paul E. Torgersen John D. Wilson ITEM 5. OTHER INFORMATION. On April 15, 1997, the Board of Directors of the Registrant adopted an Amendment to the Corporations' By-Laws that increased the current number of directors to ten. The Board appointment to fill this newly created vacancy will serve as a Class B director until the 1998 Annual Meeting of Shareholders. PART II - OTHER INFORMATION (con'd.) ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. a. Exhibits. (3)(b) By-Laws (27) Financial Data Schedule b. Reports on Form 8-K. No reports on Form 8-K have been filed during the quarter for which this report is filed. Items 2 and 3 are omitted because the information required by these items is not applicable. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ROANOKE ELECTRIC STEEL CORPORATION Registrant Date June 2,1997 Donald G. Smith Donald G. Smith, Chairman, President, Treasurer and Chief Executive Officer (Principal Financial Officer) Date June 2, 1997 John E. Morris John E. Morris, Vice President-Finance and Assistant Treasurer (Chief Accounting Officer) EXHIBIT INDEX Exhibit No. Exhibit Page (3)(b) By-Laws 15 (27) Financial Data Schedule 16 EXHIBIT NO. 3 (b) BY-LAWS EXHIBIT NO. 27 FINANCIAL DATA SCHEDULE EX-27 2
5 The schedule contains summary financial information extracted from the 2nd Quarter Consolidated Balance Sheets and Statement of Earnings and is qualified in its entirety by reference to such financial statements. 6-MOS OCT-31-1997 APR-30-1997 5,787,533 6,439,678 35,643,594 0 33,154,516 83,740,231 150,002,487 67,907,895 166,028,258 23,434,233 30,666,667 0 0 2,036,646 96,007,188 166,028,258 119,651,630 119,651,630 98,469,622 98,469,622 10,238,374 0 889,696 10,053,938 4,010,194 6,043,744 0 0 0 6,043,744 .81 .81
EX-3 3 BY-LAWS OF ROANOKE ELECTRIC STEEL CORPORATION ARTICLE I Offices The principal office and place of business of the Corporation shall be in the County of Roanoke, State of Virginia, and the post office address of the Corporation shall be in the City of Roanoke, State of Virginia. ARTICLE II Stockholders Section 1 - Annual Meeting - The annual meeting of the Stockholders of the Corporation shall be held on the third Monday in January of each year. Section 2 - Special Meetings - Special meetings of the Stockholders may be called by the President and shall be called by the President or Secretary at the request in writing of a majority of the Board of Directors, or at the request in writing by Stockholders owning a majority in amount of the entire capital stock of the Corporation issued and outstanding and entitled to vote. Section 3 - Notice and Place of Meetings - The Secretary shall cause written notice of the time and place of the holding of each annual or special meeting to be mailed, at least ten (10) days prior to such meeting, to each Stockholder entitled to vote, to the post office address of record with the Corporation. Notice of special meetings of the Stockholders shall state the purpose or purposes of such meetings. Meetings shall be held at such place in the City or County of Roanoke as may be designated in the notice. Section 4 - Quorum - At any meeting of the Stockholders, the holders of a majority of the shares of the capital stock of the Corporation, issued and outstanding and entitled to vote, present in person or represented by proxy, shall represent a quorum of the Stockholders for all purposes. If the holders of the amount of stock necessary to constitute a quorum shall fail to attend, in person or by proxy, at the time and place of meeting, the Chairman of the meeting may adjourn such meeting from time to time without notice, other than by announcement at the meeting, until holders of the amount of stock requisite to constitute a quorum shall attend. At any such adjourned meeting, at which a quorum be present, any business may be transacted which might have been transacted at the meeting as originally called. Section 5 - Organization - The President, and in his absence, the Vice-President, shall call all of the meetings of the Stockholders to order and shall act as Chairman of such meetings. In the absence of the President and Vice-President, the Board of Directors shall appoint any stockholder to act as Chairman of such meeting. The Secretary of the Corporation shall act as Secretary of all meetings of the Stockholders, and in the absence of the Secretary, the presiding officer may appoint any person to act in such capacity. Section 6 - Voting - At each meeting of the Stockholders, every Stockholder shall be entitled to vote in person or by proxy appointed by an instrument in writing, subscribed by such Stockholder, or by his duly authorized attorney, and delivered to the Secretary at the meeting, and he shall have one vote for each share of stock entitled to vote and registered in his name at the time of taking the list of Stockholders for such meeting. No share of stock shall be voted at any election which shall have been transferred on the books of the Corporation within twenty (20) days next preceding such election. Upon the demand of any Stockholder, the vote upon any question before the meeting shall be by ballot. It shall be the duty of the Secretary to prepare, at least ten (10) days before every meeting, a complete list of the Stockholders entitled to vote, arranged in alphabetical order and indicating the number of shares held by each. Such list shall be open for inspection by any Stockholder at the principal place of business of the Corporation during business hours for the ten (10) days preceding the meeting. Section 7 - Inspectors - At each meeting of the Stockholders, one (1) or more inspectors of election may be appointed by the presiding officer. It shall be the duty of the inspectors of election to count and certify to the Secretary the results of all votes at such meeting. In the absence of the appointment of such inspector or inspectors, the Secretary shall perform such duties. Section 8 - Order of Business - At meetings of the Stockholders, the order of business shall be: (1) Calling of roll. (2) Proof of due notice of meeting or of waiver of notice. (3) Reading and disposal of unapproved minutes. (4) Reports of officers and committees. (5) Election of Directors. (6) Unfinished business. (7) New business. (8) Adjournment. ARTICLE III Board of Directors Section 1 - Number and Term of Office - The business and property of the Corporation shall be managed and controlled by a Board of not less than five, nor more than nine Directors. The Directors shall be elected by ballot, by a majority of the Stockholders present and voting in person or by proxy, at each annual meeting of the Stockholders, and shall be elected to serve for a term of one (l) year and until their successors shall be elected and shall qualify. Section 2 - Vacancies - In case of any vacancy in the Board of Directors through death, resignation, disqualification or other cause, the remaining Directors, by an affirmative vote of the majority thereof, may elect a successor to hold office for the unexpired portion of the term. Section 3 - Annual Meetings - The annual meeting of the Board of Directors of the Corporation shall be held on the second Tuesday following the annual meeting of the Stockholders of the Corporation. Section 4 - Special Meetings - Special meetings of the Board of Directors shall be held whenever called by the direction of its Chairman or the President, or by one-third in number of the Directors then in office. Section 5 - Time, Place and Notice of Meetings - The Secretary shall cause written notice of the time and place of the holding of each annual or special meeting to be mailed, at least ten (10) days prior to the date of such meeting, to each Director to the post office address of record with the Corporation. Section 6 - Quorum - A majority of the Board of Directors shall constitute a quorum for the transaction of business, but if at any meeting of the Board, there be less than a quorum present, a majority of those present shall adjourn the meeting from time to time. Section 7 - Election and Salaries of Officers - The Directors shall elect the officers of the Corporation and fix their salaries. Section 8 - Order of Business - At meetings of the Board of Directors, the order of business shall be: (1) Calling of roll. (2) Proof of due notice of meeting or of waiver of notice. (3) Reading and disposal of any unapproved minutes. (4) Reports of officers and committees. (5) Election of officers. (6) Unfinished business. (7) New business. (8) Adjournment. ARTICLE IV Section 1 - Officers - The officers of the Corporation shall be a Chairman of the Board of Directors, a President, a Vice-President, a Secretary and a Treasurer. Any two or more of such offices, other than those of President and Secretary, may be held by one person. The Board of Directors may, in its discretion, elect more than one Vice-President, and an Assistant Secretary and Assistant Treasurer. The officers shall be elected at each annual meeting of the Board of Directors and shall be elected to serve for a term of one (1) year or until removed by a majority vote of the entire Board of Directors. Section 2 - Powers and Duties of Officers (a) The Chairman of the Board of Directors shall preside at all meetings of the Board of Directors. (b) President - The President shall be elected from the Board of Directors and shall preside at all meetings of the Stockholders, and, in the absence of the Chairman of the Board of Directors, at all meetings of the Directors. He shall have power to sign certificates of stock, to sign and execute all contracts, deeds, leases and other documents, and to sign checks, drafts, notes and orders for the payment of money, and to appoint, discharge and fix the salaries of agents and employees. He shall have general and active management of the business of the Corporation and shall perform all of the duties incident to the office of President. (c) Vice-President - The Vice-President, or Vice-Presidents, shall have such powers and perform such duties as may be delegated to him or them by the Board of Directors. In the absence or disability of the President, the senior Vice-President may perform the duties and exercise the powers of the President. (d) Treasurer and Assistant Treasurer - The Treasurer shall have custody of all funds and securities of the Corporation and shall keep a full and accurate account of all monies received and paid by him on account of the Corporation. He shall have power to sign all checks, drafts, notes and orders for the payment of money and shall perform all acts incident to the position of Treasurer, subject to the control of the Board of Directors. The Assistant Treasurer shall have such powers and duties as may be delegated to him by the Board of Directors and, in the absence or disability of the Treasurer, may perform the duties and exercise the powers of the Treasurer. (e) Secretary and Assistant Secretary - The Secretary shall keep the minutes of all meetings of the Board of Directors and Stockholders, and shall give and serve all notices. The Secretary shall attest and countersign all contracts, deeds, leases and other documents where necessary, and shall have charge and custody of the seal, and of the stock certificate books, transfer books and stock ledgers of the Corporation, and shall, in general, perform all duties usually incident to the office of Secretary. The Assistant Secretary shall have such powers and duties as may be delegated to him by the Board of Directors and, in the absence or disability of the Secretary, may perform the duties and exercise the powers of the Secretary. ARTICLE V Capital Stock, Dividends and Seal Section 1 - Certificates of Shares - The certificates for the shares of the capital stock of the Corporation shall be in such form as may be approved by the Board of Directors. The certificates shall be signed by the President and the Secretary or Treasurer of the Corporation and shall be consecutively numbered. The name of the person owning the shares represented by each certificate, with the number of such shares and the date of issue, shall be entered on the Corporation's books. The Corporation may treat the holder of record of any share or shares of stock as the holder-in-fact thereof, and shall not be bound to recognize any claim to or interest in any such share on the part of any other person. Section 2 - Transfer of Shares - Shares of the capital stock of the Corporation shall be transferable by the holder thereof in person, or by his duly authorized attorney, upon surrender and cancellation of certificates for a like number of shares properly endorsed. Section 3 - Regulations - The Board of Directors shall have power and authority to make all such rules and regulations as they may deem expedient concerning the issue, transfer and registration of certificates for the shares of stock of the Corporation. Section 4 - Dividends - The Board of Directors may declare dividends from the surplus of the Corporation or from the net profits from the operation of its business at such times and in such amounts as the Board, in its sole discretion, may determine. Before the payment of any dividend or the distribution of any profits, there may be set aside out of the surplus or net profits arising out of the operation of the business of the Corporation, such sum or sums as the Directors from time to time think proper, either as working capital, a reserve fund to meet contingencies, for the repair and maintenance of the property of the Corporation, or for such other purposes as the Directors shall think conducive to the interests of the Corporation. Section 5 - Corporate Seal - The corporate seal shall have inscribed thereon the name of the Corporation, the year of its organization, and the words "Corporate Seal" and "Virginia". Section 6 - Fiscal Year and Financial Statements - The fiscal year of the Corporation shall begin on the first day of November and terminate on the 31st day of October in each year. The Board of Directors shall publish and submit to the Stockholders, along with the notice of the time and place of the annual meeting, an operating statement of the Corporation for the preceding fiscal year and a consolidated balance sheet showing the assets and liabilities of the Corporation at the end of the preceding fiscal year. ARTICLE VI Amendment of By-Laws The By-Laws of the Corporation may be amended at any annual or special meeting of the Corporation by a vote of the holders of a majority of the shares of the capital stock of the Corporation issued and outstanding and entitled to vote, present in person or represented by proxy. John W. Hancock, Jr. President ATTEST: Elizabeth B. Hancock Secretary WAIVER OF NOTICE We, the undersigned, being all of the members of the Board of Directors of Roanoke Electric Steel Corporation, hereby waive notice of the first meeting of the Board of Directors to be held at the offices of Roanoke Iron and Bridge Works in the City of Roanoke, Virginia at 4 p.m. o'clock on the 27th day of April, 1955, and consent to the transaction of all business that may properly come before such meeting. DATED at Roanoke, Virginia this 27th day of April, 1955. John W. Hancock, Jr. O.D. Oakey, Jr. S. Colston Snead, Jr. B.W. Morris Charles P. Lunsford A. Blair Antrim John M. Donalson ARTICLES OF AMENDMENT TO BY-LAWS OF ROANOKE ELECTRIC STEEL CORPORATION Pursuant to Section 13.1 - 3(n), Code of Virginia, 1950, as amended, Roanoke Electric Steel Corporation executes Articles of Amendment to its By-Laws as follows: (a) The name of the Corporation is ROANOKE ELECTRIC STEEL CORPORATION. (b) The amendment so adopted amends Article VI of the By-Laws to read as follows: "The Corporation shall indemnify each director and officer of the Corporation, his heirs, executors, administrators and personal representatives, against any and all liabilities, judgments, fines, penalties and claims (including amounts paid in settlement) imposed upon or asserted against him by reason of his being or having been an officer or director of the Corporation or of any other corporation in which he served or serves as a director or officer pursuant to the written request of the Corporation (whether or not he continues to be an officer or director at the time of such imposition or assertion), and against all expenses (including counsel fees) reasonably incurred by him in connection therewith, except in respect of matters as to which he shall have been finally adjudged to be liable by reason of having been guilty of negligence or misconduct in the performance of his duty as such director or officer. In the event of any other judgment against such officer or director or in the event of a settlement, the indemnification shall be made only if the Corporation shall be advised (a) by the Board of Directors, in case none of the persons involved shall then be a director of the Corporation, or (b) by independent counsel appointed by the Board of Directors, in case any of the persons involved shall then be a director of the Corporation, that in its or his opinion, as the case may be, such director or officer was not guilty of negligence or misconduct in the performance of his duty, and, in the event of a settlement, that such settlement was, or, if still to be made, would be, in the best interests of the Corporation. If the determination is to be made by the Board of Directors, it may rely, as to all questions of law, upon the advice of independent counsel. The foregoing right of indemnification shall not be exclusive of other rights to which any director or officer may be entitled as a matter of law or otherwise." (c) The meeting of the Board of Directors at which the amendment was found to be in the best interests of the Corporation and directed to be submitted to a vote at a meeting of stockholders was held on the 18th day of October, 1967. Notice was given to each stockholder of record entitled to vote on the 15th day of December, 1967, such notice being given more than twenty-five and less than fifty days before the date of the meeting and was given in the manner provided in this Act, and was accompanied by a copy of the proposed amendment; the date of the adoption of the amendment by the stockholders was the 15th day of January, 1968. (d) The number of shares outstanding and the number of shares entitled to vote on the amendment was 560,000 shares; all shares being common stock of no par value, there was no class entitled to vote thereon as a class. (e) The number of shares present in person or by proxy voted for the amendment was 441,265 shares and none against such amendment. (f) Such amendment does not effect a change in the amount of stated capital. (g) Such amendment does not effect a restatement of the Articles of Incorporation. Witness the signature of Roanoke Electric Steel Corporation, by its President, with the corporate seal affixed and attested by the Secretary thereof, this 20th day of January, 1968. ROANOKE ELECTRIC STEEL CORPORATION BY William M. Meador President ATTEST: Donald G. Smith Secretary STATE OF VIRGINIA ) ) To-Wit: COUNTY OF ROANOKE ) I, Paul D. Sturgill, a Notary Public in and for the County of Roanoke, State of Virginia, do hereby certify that William M. Meador, and Donald G. Smith, President and Secretary respectively of Roanoke Electric Steel Corporation, have this day personally appeared before me and executed the foregoing Articles of Amendment, and made oath that the matters therein stated are true and correct. Given under my hand this 20th day of January, 1968. My commission expires April 4, 1968. Paul D. Sturgill Notary Public ARTICLES OF AMENDMENT TO BY-LAWS OF ROANOKE ELECTRIC STEEL CORPORATION Pursuant to Section 13.1 - 24, Code of Virginia, 1950, as amended, Roanoke Electric Steel Corporation executes Articles of Amendment to its By-Laws as follows: (a) The name of the Corporation is ROANOKE ELECTRIC STEEL CORPORATION. (b) The amendment so adopted adds a new by-law, which would be new Article VII, to read as follows: "The power to alter, amend or repeal the By-laws or adopt new by-laws shall be vested in the Board of Directors. But by-laws made by the Board of Directors may be repealed or changed, and new by-laws made, by the stockholders and the stockholders may prescribe that any by-law made by them shall not be altered, amended or repealed by the Directors." (c) The meeting of the Board of Directors at which the amendment was found to be in the best interests of the Corporation and directed to be submitted to a vote at a meeting of stockholders was held on the 18th day of October, 1967. Notice was given to each stockholder of record entitled to vote on the 15th day of December, 1967, such notice being given more than twenty-five and less than fifty days before the date of the meeting and was given in the manner provided in this Act, and was accompanied by a copy of the proposed amendment; the date of the adoption of the amendment by the stockholders was the 15th day of January, 1968. (d) The number of shares outstanding and the number of shares entitled to vote on the amendment was 560,000 shares; all shares being common stock of no par value, there was no class entitled to vote thereon as a class. (e) The number of shares present in person or by proxy voted for the amendment was 441,265 shares and none against such amendment. (f) Such amendment does not effect a change in the amount of stated capital. (g) Such amendment does not effect a restatement of the Articles of Incorporation. Witness the signature of Roanoke Electric Steel Corporation, by its President, with the corporate seal affixed and attested by the Secretary thereof, this 20th day of January, 1968. ROANOKE ELECTRIC STEEL CORPORATION BY William M. Meador President ATTEST: Donald G. Smith Secretary STATE OF VIRGINIA ) ) To-Wit: COUNTY OF ROANOKE ) I, Paul D. Sturgill, a Notary Public in and for the County of Roanoke, State of Virginia, do hereby certify that William M.Meador, and Donald G. Smith, President and Secretary respectively of Roanoke Electric Steel Corporation, have this day personally appeared before me and executed the foregoing Articles of Amendment, and made oath that the matters therein stated are true and correct. Given under my hand this 20th day of January, 1968. My commission expires April 4, 1968. Paul D. Sturgill Notary Public ARTICLES OF AMENDMENT TO BY-LAWS OF ROANOKE ELECTRIC STEEL CORPORATION Pursuant to Section 13.1-24 of the Code of Virginia and Article VII of the By-Laws of Roanoke Electric Steel Corporation, The Board of Directors of Roanoke Electric Steel Corporation hereby amends the By-Laws of the Corporation as follows: (a) Section 2 of Article V is amended by inserting "(subject to such restrictions as may be placed upon the transfer of shares under the terms of the following section)" between "transferable" and "by". (b) Section 3 of Article V is amended by adding to the end of such section the following sentence: "The Board of Directors may place such restrictions upon the transferability of all or part of the shares of the capital stock of the Corporation as may be necessary in the opinion of the Board to insure that any issue of stock by the Corporation will comply with applicable federal and state securities laws and with the terms of any agreement of merger or other corporate reorganization duly approved by the Board." (c) The meeting of the Board of Directors at which the amendment was found to be in the best interest of the Corporation was held on the 19th day of August, 1975. Witness the signature of Roanoke Electric Steel Corporation, by its President, with the corporate seal affixed and attested by the Secretary thereof, this 19th day of August, 1975. ROANOKE ELECTRIC STEEL CORPORATION By William M. Meador President ATTEST: Donald G. Smith Secretary ARTICLES OF AMENDMENT TO BY-LAWS OF ROANOKE ELECTRIC STEEL CORPORATION Pursuant to Section 13.1-24 of the Code of Virginia and Article VII of the By-Laws of Roanoke Electric Steel Corporation, the Board of Directors of Roanoke Electric Steel Corporation executes Articles of Amendment to its By-Laws as follows: (a) The name of the Corporation is ROANOKE ELECTRIC STEEL CORPORATION. (b) The amendment so adopted amends Section 1 of Article III to read as follows: "The business and property of the Corporation shall be managed and controlled by a Board of not less than five, nor more than ten Directors. The Directors shall be elected by ballot, by a majority of the Stockholders present and voting in person or by proxy, at each annual meeting of the Stockholders, and shall be elected to serve for a term of one (1) year and until their successors shall be elected and shall qualify." (c) The meeting of the Board of Directors at which the amendment was found to be in the best interest of the Corporation was held on the 16th day of September, 1975. Witness the signature of Roanoke Electric Steel Corporation, by its President, with the corporate seal affixed and attested by the Secretary thereof, this 16th day of September, 1975. ROANOKE ELECTRIC STEEL CORPORATION By William M. Meador President ATTEST: Donald G. Smith Secretary ARTICLES OF AMENDMENT TO BY-LAWS OF ROANOKE ELECTRIC STEEL CORPORATION Pursuant to Section 13.1-24 of the Code of Virginia and Article VII of the By-Laws of Roanoke Electric Steel Corporation, the Board of Directors of Roanoke Electric Steel Corporation executes Articles of Amendment to its By-Laws as follows: (a) The name of the Corporation is ROANOKE ELECTRIC STEEL CORPORATION. (b) The amendment so adopted amends Section 1 of Article III to read as follows: "The business and property of the Corporation shall be managed and controlled by a Board of not less than five, nor more than eleven Directors. The Directors shall be elected by ballot, by a majority of the Stockholders present and voting in person or by proxy, at each annual meeting of the Stockholders, and shall be elected to serve for a term of one (1) year and until their successors shall be elected and shall qualify." (c) The meeting of the Board of Directors at which the amendment was found to be in the best interest of the Corporation was held on the 17th day of April 1984. Witness the signature of Roanoke Electric Steel Corporation, by its President, with the corporate seal affixed and attested by the Secretary thereof, this 17th day of April 1984. ROANOKE ELECTRIC STEEL CORPORATION By William M. Meador President ATTEST: Donald G. Smith Secretary ARTICLES OF AMENDMENT TO BYLAWS OF ROANOKE ELECTRIC STEEL CORPORATION Pursuant to Section 13.1-24 of the Code of Virginia and Article VII of the Bylaws of Roanoke Electric Steel Corporation, the Board of Directors of Roanoke Electric Steel Corporation hereby executes and approves these Articles of Amendment to its Bylaws as follows: (a) Article III, "Board of Directors", is hereby amended by the addition of Section 9 as follows: Section 9 - Executive Committee and Other Committees The Board of Directors of the Corporation, by resolution adopted by a majority of the Directors in office, may designate an Executive Committee and/or such other committees as from time to time shall be deemed necessary and appropriate. The Executive Committee shall be composed of two or more Directors of the Corporation, appointed by the Board of Directors, and, to the extent provided in such resolution, shall have and exercise all of the authority of the Board of Directors except to approve an amendment of the Articles of Incorporation, a plan of merger or consolidation, a plan of exchange under which the Corporation would be acquired, the sale, lease or exchange, or the mortgage or pledge of for a consideration other than money, of all or substantially all of the property and assets of the Corporation otherwise than in the ordinary and regular course of business, the voluntary dissolution of the Corporation, or revocation of voluntary dissolution proceedings. Other committees consisting of two or more Directors, appointed by the Board of Directors, may be designated by resolution adopted by a majority of the Directors present at a meeting at which a quorum is present. Upon designation of any committee, including the Executive Committee, the Board of Directors shall appoint a chairman thereof. (b) A meeting of the Board of Directors at which this Amendment was found to be in the best interest of the Corporation was held January 29, 1985. A majority of the Board of Directors then in office voted in favor of the Amendment. WITNESS the signature of Roanoke Electric Steel Corporation, by its President, with the corporate seal affixed and attested by the Secretary of, this 29th day of January, 1985. ROANOKE ELECTRIC STEEL CORPORATION By Donald G. Smith Attest: Thomas J. Crawford Secretary ARTICLES OF AMENDMENT TO BYLAWS OF ROANOKE ELECTRIC STEEL CORPORATION Pursuant to Section 13.1-714 of the Code of Virginia, 1950, as amended, and Article VII of the Bylaws of Roanoke Electric Steel Corporation, the Board of Directors of Roanoke Electric Steel Corporation hereby executes and approves these Articles of Amendment to its Bylaws as follows: (a) Article IV, Section 1 is hereby amended to read as follows: Section 1 - Officers - The officers of the Corporation shall be a Chairman of the Board of Directors, a President, a Vice President, an Assistant Vice President, a Secretary and a Treasurer. The Board of Directors may, in its discretion, elect more than one Vice President, more than one Assistant Vice President, and an Assistant Secretary and Assistant Treasurer. The same individual may simultaneously hold more than one office in the Corporation. The officers shall be elected at each annual meeting of the Board of Directors for a term of one (1) year or until removed by a majority vote of the entire Board of Directors. (b) Article IV, Section 2 (c) is hereby amended to read as follows: (c) Vice President and Assistant Vice President - The Vice President(s) and Assistant Vice President(s) shall have the powers and perform such duties as may be delegated to him or them by the Board of Directors. In the absence or disability of the President, the senior Vice President may perform the duties and exercise the powers of the President. (c) The meeting of the Board of Directors at which these Amendments were found to be in the best interest of the Corporation was held October 18, 1988. The majority of the Board of Directors then in office voted in favor of the Amendments. The Amendments were ratified by a majority of the Board of Directors at its meeting on November 15, 1988. WITNESS the signature of Roanoke Electric Steel Corporation, by its President, with the corporate seal affixed and attested by the Secretary thereof, this 15th day of November, 1988. ROANOKE ELECTRIC STEEL CORPORATION By Donald G. Smith President ATTEST: Thomas J. Crawford Secretary ARTICLES OF AMENDMENT TO BYLAWS OF ROANOKE ELECTRIC STEEL CORPORATION Pursuant to Section 13.1-714 of the Code of Virginia, 1950, as amended, and Article VII of the Bylaws of Roanoke Electric Steel Corporation, the Board of Directors of Roanoke Electric Steel Corporation hereby executes and approves these Articles of Amendment to its Bylaws as follows: (a) Section 1 of Article IV of the Bylaws is hereby amended in its entirety to read as follows: "Section 1 - Officers - The officers of the Corporation shall be a Chairman of the Board of Directors, a President, a Vice President, an Assistant Vice President, a Secretary and a Treasurer and such other officers as the Board may by resolution appoint. The same individual may simultaneously hold more than one office in the Corporation. The Board of Directors may, in its discretion, elect more than one Vice President, more than one Assistant Vice President, and an Assistant Secretary and Assistant Treasurer. The officers shall be elected at each annual meeting of the Board of Directors and shall be elected to serve for a term of one (1) year or until removed by a majority vote of the entire Board of Directors." (b) The meeting of the Board of Directors at which this Amendment was found to be in the best interests of the Corporation was held on November 16, 1993. The majority of the members of the Board of Directors then in office voted in favor of the Amendment. WITNESS the signature of Roanoke Electric Steel Corporation, by its President, with the corporate seal affixed and attested by the Secretary thereof, this 16th day of November, 1993. ROANOKE ELECTRIC STEEL CORPORATION By: Donald G. Smith President ATTEST: Thomas J. Crawford Secretary ARTICLES OF AMENDMENT TO BY-LAWS OF ROANOKE ELECTRIC STEEL CORPORATION Pursuant to Section 13.1-714 of the Code of Virginia and Article VII of the By-Laws of Roanoke Electric Steel Corporation, the Board of Directors of Roanoke Electric Steel Corporation executes Articles of Amendment to its By-Laws as follows: (a) The name of the Corporation is Roanoke Electric Steel Corporation. (b) The amendment so adopted (the "Amendment") amends Section 1 of Article II to read as follows: "Section 1 - Annual Meeting - The annual meeting of the Stockholders of the Corporation shall be held on the third Tuesday in February of each year, or on such other date as the Board of Directors may determine." (c) The Amendment also amends Section 3 of Article III to read as follows: "Section 3 - Annual Meeting - The annual meeting of the Board of Directors of the Corporation shall be held immediately following the annual meeting of Stockholders, or at such other time as the Board of Directors may determine." (d) The meeting of the Board of Directors at which the Amendment was found to be in the best interest of the Corporation was held on the 19th day of September, 1995. Witness the signature of Roanoke Electric Steel Corporation, by its President, with the corporate seal affixed and attested by the Secretary thereof, this 19th day of September, 1995. ROANOKE ELECTRIC STEEL CORPORATION By Donald G. Smith President ATTEST: Thomas J. Crawford Secretary ARTICLES OF AMENDMENT TO BY-LAWS OF ROANOKE ELECTRIC STEEL CORPORATION Pursuant to Section 13.1-714 of the Code of Virginia and Article VII of the By-Laws of Roanoke Electric Steel Corporation, the Board of Directors of Roanoke Electric Steel Corporation executes Articles of Amendment to its Bylaws as follows: A. The name of the Corporation is Roanoke Electric Steel Corporation. B. The Amendment so adopted (the "Amendment") amends Section 1 of Article III to read as follows: "Section 1 - Number and Term of Office. The number of directors of the Corporation shall be nine. The directors shall be divided into three classes (A, B and C) as nearly equal in number as possible. The initial term of office for members of Class A shall expire at the annual meeting of stockholders in 1997; the initial term of office for members of Class B shall expire at the annual meeting of stockholders in 1998; and the initial term of office for members of Class C shall expire at the annual meeting of stockholders in 1999. At each annual meeting of stockholders following such initial classification and election, directors elected to succeed those directors whose terms expire after their election and shall continue to hold office until their respective successors are elected and qualify." C. The Amendment also amends Section 2 of Article III to read as follows: "Section 2 - Vacancies. Newly-created directorships resulting from an increase in the number of directors or any vacancies in the Board of Directors resulting from death, resignation, retirement, disqualification, removal from office, or other cause shall be filled by the affirmative vote of a majority of the directors then in office, whether or not a quorum. No decrease in the number of directors constituting the Board of Directors shall shorten the term of any incumbent director. A director may be removed from office only for cause." D. The meeting of the Board of Directors at which the Amendment was found to be in the best interest of the Corporation was held on the 15 day of October, 1996. WITNESS the signature of Roanoke Electric Steel Corporation, by its President, with the corporate seal affixed and attested by the Secretary thereof, this 15 day of October, 1996. ROANOKE ELECTRIC STEEL CORPORATION By Donald G. Smith President Attest: Thomas J. Crawford Secretary ARTICLES OF AMENDMENT TO BY-LAWS OF ROANOKE ELECTRIC STEEL CORPORATION Pursuant to Section 13.1-714 of the Code of Virginia and Article VII of the By-Laws of Roanoke Electric Steel Corporation, the Board of Directors of Roanoke Electric Steel Corporation executes Articles of Amendment to its Bylaws as follows: A. The name of the Corporation is Roanoke Electric Steel Corporation. B. The Amendment so adopted (the "Amendment") amends Section 1 of Article III to read as follows: "Section 1 - Number and Term of Office. The number of directors of the Corporation shall be ten. The directors shall be divided into three classes (A, B, and C) as nearly equal in number as possible. The initial term of office for members of Class A shall expire at the annual meeting of stockholders in 1997; the initial term of office for members of Class B shall expire at the annual meeting of stockholders in 1998; and the initial term of office for members of Class C shall expire at the annual meeting of stockholders in 1999. At each annual meeting of stockholders following such initial classification and election, directors elected to succeed those directors whose terms expire after their election shall continue to hold office until their respective successors are elected and qualify." C. The meeting of the Board of Directors at which the Amendment was found to be in the best interest of the Corporation was held on the 15 day of April, 1997. Witness the signature of Roanoke Electric Steel Corporation, by its President, with the corporate seal affixed and attested by the Secretary thereof, this 15 day of April, 1997. ROANOKE ELECTRIC STEEL CORPORATION By Donald G. Smith President ATTEST: Thomas J. Crawford Secretary -----END PRIVACY-ENHANCED MESSAGE-----