<SUBMISSION>
<ACCESSION-NUMBER>0000950123-03-002588
<TYPE>S-3
<PUBLIC-DOCUMENT-COUNT>8
<REFERENCES-429>333-82210
<FILING-DATE>20030307
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>STEEL DYNAMICS INC
<CIK>0001022671
<ASSIGNED-SIC>3312
<IRS-NUMBER>351929476
<STATE-OF-INCORPORATION>IN
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>S-3
<ACT>33
<FILE-NUMBER>333-103672
<FILM-NUMBER>03596505
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>7030 POINTE INVERNESS WAY
<STREET2>SUITE 310
<CITY>FORT WAYNE
<STATE>IN
<ZIP>46804
<PHONE>2194593553
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>7030 POINTE INVERNERSS WAY
<STREET2>SUITE 310
<CITY>FORT WAYNE
<STATE>IN
<ZIP>46804
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>S-3
<SEQUENCE>1
<FILENAME>y84184sv3.txt
<DESCRIPTION>STEEL DYNAMICS, INC.
<TEXT>
<PAGE>

     AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 7, 2003
                                                     REGISTRATION NO. 333-
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                            ------------------------

                                    FORM S-3
            REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
                            ------------------------

                              STEEL DYNAMICS, INC.

             (Exact name of registrant as specified in its charter)

<Table>
<S>                                              <C>
                    INDIANA                                        35-1929476
 (State or other jurisdiction of incorporation        (I.R.S. Employer Identification No.)
               or organization)
     6714 POINTE INVERNESS WAY, SUITE 200                KEITH E. BUSSE, PRESIDENT & CEO
           FORT WAYNE, INDIANA 46804                  6714 POINTE INVERNESS WAY, SUITE 200
                (260) 459-3553                              FORT WAYNE, INDIANA 46804
  (Address, including zip code, and telephone                    (260) 459-3553
 number, including area code, of registrant's        (Name, address, including zip code, and
         principal executive offices)            telephone number, including area code, of agent
                                                                  for service)
</Table>

                                   COPIES TO:
                            ROBERT S. WALTERS, ESQ.
                             BARRETT & MCNAGNY LLP
                             215 EAST BERRY STREET
                           FORT WAYNE, INDIANA 46802
                                 (260) 423-9551

     APPROXIMATE DATE OF COMMENCEMENT OF THE PROPOSED SALE TO THE PUBLIC:  From
time to time after the effective date of this Registration Statement.

     If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box.  [ ]

     If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box.  [X]

     If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act of 1933, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering.  [ ]

     If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act of 1933, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering.  [ ]

     If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box.  [ ]

                        CALCULATION OF REGISTRATION FEE

<Table>
<Caption>
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
                                                      PROPOSED MAXIMUM        PROPOSED AGGREGATE          AMOUNT OF
   TITLE OF EACH CLASS OF        AMOUNT TO BE          OFFERING PRICE               MAXIMUM             REGISTRATION
SECURITIES TO BE REGISTERED      REGISTERED(2)      PER UNIT OR SHARE(3)       OFFERING PRICE(3)           FEE(4)
------------------------------------------------------------------------------------------------------------------------
<S>                           <C>                  <C>                      <C>                      <C>
4% Convertible Subordinated
  Notes Due 2012(1).........     $115,000,000               100%                 $115,000,000              $9,304
Common Stock, par value
  $0.01 par share(5)........   6,762,874 Shares              --                       --                     --
Common Stock, par value
  $0.01 par share(6)........    436,150 Shares               --                       --                     --
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
</Table>

                                                        (continued on next page)

     THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>

(continued from previous page)

(1) We issued the 4% Convertible Notes due 2012 on December 23, 2002 and January
    3, 2003 in an offering exempt from registration under the Securities Act of
    1933. Under a registration rights agreement dated December 23, 2002 among us
    and the initial purchasers of the notes, who resold the notes in offerings
    exempt from registration under Rule 144A under the Securities Act, we are
    obligated to file this registration statement to permit registered resales
    by the selling security holders of the notes and the shares of common stock
    underlying the notes.

(2) We are registering $115,000,000 aggregate principal amount of notes and
    6,762,874 shares of common stock initially issuable upon conversion of the
    notes. The prospectus filed with this registration statement, however, is a
    combined prospectus pursuant to Rule 429 under the Securities Act and
    includes (a) the securities we are registering hereby and (b) 436,150 shares
    of our common stock which we registered under Registration Statement No.
    333-82210, effective February 28, 2002, which remain unsold.

(3) Estimated solely for purposes of calculating the registration fee pursuant
    to Rule 457(i) under the Securities Act, based upon the offering price of
    the notes when we originally sold the notes on December 23, 2002 and on
    January 3, 2003.

(4) Does not include any registration fee payable with respect to the 436,150
    shares of common stock held by GE Capital CFE, Inc., covered by the combined
    prospectus and previously registered under Registration Statement No.
    333-82210, with respect to which we already paid the required fee. In
    addition, under Rule 457(i) there is no additional filing fee payable with
    respect to the shares of common stock issuable upon conversion of the notes
    because we will receive no additional consideration upon exercise of the
    conversion privilege.

(5) Represents the number of shares of common stock issuable upon conversion of
    the 4% Convertible Subordinated Notes due 2012 which we are hereby
    registering. The notes are convertible into 58.8076 shares of our common
    stock, par value $0.01 per share, per $1,000 principal amount of notes,
    subject to adjustment under certain circumstances. Pursuant to Rule 416
    under the Securities Act, such number of shares includes an indeterminate
    number of shares of common stock that may be issuable from time to time upon
    the conversion of the notes as a result of a stock split, stock dividend,
    recapitalization or similar event.

(6) Shares of common stock held by GE Capital CFE, Inc. previously registered
    pursuant to Registration Statement No. 333-82210 and being registered
    herewith under the combined prospectus.
                            ------------------------

     Pursuant to Rule 429 under the Securities Act, this registration statement
contains a combined prospectus that covers shares of our common stock previously
registered that remain unsold under Registration Statement on Form S-3, SEC File
No. 333-82210. Accordingly, this registration statement constitutes a
post-effective amendment to such earlier registration statement. This
post-effective amendment shall hereafter become effective concurrently with the
effectiveness of this registration statement.
<PAGE>

THE  INFORMATION IN  THIS PROSPECTUS  IS NOT  COMPLETE AND  MAY BE  CHANGED. THE
SELLING SECURITYHOLDERS MAY  NOT SELL  THESE SECURITIES  UNTIL THE  REGISTRATION
STATEMENT  FILED WITH THE SECURITIES AND  EXCHANGE COMMISSION IS EFFECTIVE. THIS
PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING  AN
OFFER  TO BUY  THESE SECURITIES  IN ANY  STATE WHERE  THE OFFER  OR SALE  IS NOT
PERMITTED.

                  SUBJECT TO COMPLETION, DATED MARCH 7, 2002.

PROSPECTUS

                              STEEL DYNAMICS, INC.
                   4% CONVERTIBLE SUBORDINATED NOTES DUE 2012

     6,762,874 SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THE NOTES

                                      AND

                   436,150 ADDITIONAL SHARES OF COMMON STOCK
                             ---------------------
    On December 23, 2002 and on January 3, 2003, we issued and sold $115,000,000
aggregate principal amount of our 4% Convertible Subordinated Notes due 2012 in
a private offering. The holders of the notes and the common stock issuable upon
conversion of the notes, identified in this prospectus, as well as the holder of
the other shares of common stock identified in this prospectus, may from time to
time offer up to the full amount of these securities pursuant to this
prospectus. If required, we will set forth the names of any other selling
securityholders in a post-effective amendment to the registration statement of
which this prospectus is a part.

    We will not receive any proceeds from the sale of the notes, the shares of
common stock issuable upon conversion of the notes or the other shares of common
stock by any of the selling securityholders. The notes and the shares of common
stock may be offered in negotiated transactions or otherwise, at market prices
prevailing at the time of sale or at negotiated prices. The selling
securityholders will also pay any applicable discounts, commissions or
concessions in connection with such sale. The selling securityholders and any
underwriters, broker-dealers or agents that participate in the sale of the
securities may be "underwriters" within the meaning of the Securities Act, and
any discounts, commissions, concessions or profit they earn on any resale of the
securities may constitute underwriting discounts or commissions under the
Securities Act.

    We will pay interest on the notes on June 15 and December 15 of each year,
beginning June 15, 2003. The notes mature on December 15, 2012, unless earlier
converted, redeemed or repurchased by us.

    Beginning with the six-month interest period commencing December 15, 2007,
we will pay additional contingent interest on the notes during any six-month
interest period from December 15 to June 14 and from June 15 to December 14, if
the trading price of a note for each of the five trading days immediately
preceding the first day of the applicable six-month interest period equals 120%
or more of the principal amount of such note.

    Holders of notes may convert the notes, before maturity, into shares of our
common stock at a conversion rate of 58.8076 shares per $1,000 principal amount
of notes (equivalent to an initial conversion price of approximately $17.0046
per share), subject to adjustment, only under the following circumstances:

    (1) During any fiscal quarter commencing after December 31, 2002, at any
        time after the closing sale price of our common stock exceeds 120% of
        the conversion price for at least 20 trading days in the 30 consecutive
        trading days ending on the last trading day of any fiscal quarter;

    (2) After the earlier of (a) the date the notes are rated by both Standard &
        Poor's Credit Market Services, a division of the McGraw-Hill Companies,
        and Moody's Investor Services, Inc. and (b) January 31, 2003, during any
        period that the long-term credit rating assigned to the notes by either
        Standard & Poor's or Moody's (or any successor to these entities) is
        "CCC" or "Caa3", respectively, or lower, or if either of these rating
        agencies no longer rates the notes, or if either of these rating
        agencies suspends or withdraws the rating assigned to the notes, or if
        the notes are not assigned a rating by both rating agencies;

    (3) If the notes have been called for redemption; or

    (4) Upon the occurrence of specified corporate events described under
        "Description of Notes."

    From December 18, 2007 through December 14, 2008, we may redeem any of the
notes at a redemption price of 101.143%, and from December 15, 2008 through
December 14, 2009 at a redemption price of 100.571% of their principal amount
plus accrued interest. After December 15, 2009, we may redeem any of the notes
at a redemption price of 100% of their principal amount plus accrued interest.
You may also require us to repurchase your notes on or after December 15, 2009,
or following a fundamental change, at a purchase price of 100% of the principal
amount of the notes plus accrued interest.

    The notes are junior to all of our existing and future senior indebtedness
and are structurally subordinated to all existing and future liabilities of our
subsidiaries, including trade payables, lease commitments and monies borrowed.

    For U.S. federal income tax purposes, the notes are subject to U.S. federal
income tax rules applicable to contingent payment debt instruments. See "U.S.
Federal Income Tax Considerations" beginning on page 42.

    The notes originally issued in the private placement are eligible for
trading on The Private Offerings, Resales and Trading Through Automated
Linkages, or "PORTAL Market" of the National Association of Securities Dealers,
Inc. However, notes sold pursuant to this prospectus will no longer be eligible
for trading on the PORTAL Market. We do not intend to list the notes on any
national securities exchange.

    Our common stock is listed on The Nasdaq National Market under the symbol
"STLD." On March 4, 2003, the closing sale price of our common stock on The
Nasdaq National Market was $12.12.
                             ---------------------
     INVESTING IN THE NOTES, THE COMMON STOCK ISSUABLE UPON CONVERSION OF THE
NOTES, AND THE ADDITIONAL COMMON STOCK INVOLVES RISKS. SEE "RISK FACTORS"
BEGINNING ON PAGE 6.
                             ---------------------
    NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES, OR PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

                 The date of this prospectus is March 7, 2003.
<PAGE>

                               TABLE OF CONTENTS

<Table>
<Caption>
                                                               PAGE
                                                               ----
<S>                                                            <C>
Important Notice to Readers.................................     i
Prospectus Summary..........................................     1
The Offering................................................     3
Risk Factors................................................     6
Special Note Regarding Forward Looking Statements...........    18
Use of Proceeds.............................................    19
Ratios of Earnings to Fixed Charges.........................    19
Description of Notes........................................    20
Description of Capital Stock................................    35
Price Range of Common Stock.................................    37
Dividend Policy.............................................    37
Selling Securityholders.....................................    37
Plan of Distribution........................................    40
Certain United States Federal Income Tax Considerations.....    42
Certain ERISA Considerations................................    48
Legal Matters...............................................    49
Experts.....................................................    49
Where You Can Find More Information.........................    49
Information Incorporated by Reference.......................    49
</Table>

     YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH
INFORMATION THAT IS DIFFERENT. THIS PROSPECTUS MAY ONLY BE USED WHERE IT IS
LEGAL TO SELL THESE SECURITIES. THE INFORMATION IN THIS PROSPECTUS IS ACCURATE
ONLY AS OF THE DATE OF THIS PROSPECTUS, REGARDLESS OF THE TIME OF DELIVERY OF
THIS PROSPECTUS OR ANY SALE OF THE SECURITIES.
                             ---------------------

     Unless otherwise indicated, all references in this prospectus to "SDI,"
"Steel Dynamics," "Company," "we," "our," "ours" and "us" refer to Steel
Dynamics, Inc. together with its subsidiaries.

                          IMPORTANT NOTICE TO READERS

     This prospectus is part of a registration statement that we filed with the
Securities and Exchange Commission, or SEC, using a "shelf" registration
process. Under this shelf registration process, the selling securityholders may
from time to time offer notes or shares of our common stock issuable upon
conversion of the notes or otherwise covered by this prospectus. Each time a
selling securityholder offers notes or common stock under this prospectus, they
will provide a copy of this prospectus and, if applicable, a copy of a
prospectus supplement. You should read both this prospectus and, if applicable,
any prospectus supplement together with the information incorporated by
reference in this prospectus. See "Where You Can Find More Information" and
"Information Incorporated by Reference" for more information.

                                        i
<PAGE>

                               PROSPECTUS SUMMARY

     This summary contains basic information about us and this offering. Because
it is a summary, it does not contain all of the information you should consider
before investing in the notes or the common stock issuable upon conversion of
the notes or otherwise covered by this prospectus. You should read carefully
this entire prospectus, including the section entitled "Risk Factors" and the
information incorporated by reference herein, including our financial statements
and the notes thereto.

                                 STEEL DYNAMICS

     We are a steel manufacturing company that owns and operates electric
furnace steelmaking mini-mills.

     We own and operate a flat-rolled mini-mill located in Butler, Indiana,
which we built and have operated since 1996, with an annual production capacity
of 2.2 million tons of flat-rolled steel. Our Butler mini-mill, which actually
produced 2.4 million tons during 2002, produces a broad range of high quality
hot-rolled, cold-rolled and coated steel products, including a large variety of
high value-added and high margin specialty products such as thinner gauge rolled
products and galvanized products. We sell our flat-rolled products directly to
end-users, intermediate steel processors and service centers primarily in the
Midwestern United States. Our products are used in numerous industry sectors,
including the automotive, construction and commercial industries.

     In May 2002, we announced plans to construct a new coil coating facility at
our Butler mini-mill and we expect to complete this facility and to commence
coating operations in the middle of 2003. This $25 to $30 million facility will
have an annual production capacity of 240,000 tons.

     In March 2003, we announced plans to purchase the assets of the steel
coating facility formerly owned by GalvPro II LLC in Jeffersonville, Indiana for
$[--] million plus a potential of an additional $[--] million based on an
earn-out formula. We expect this purchase to be consummated during the first
quarter of 2003. We anticipate that this facility will be capable of producing
between 300,000 and 350,000 tons per year of light-gauge, hot-dipped cold-rolled
galvanized steel. We will operate this new facility as a part of our Butler,
Indiana Flat Roll Division, which we expect will supply the Jeffersonville plant
with steel coils for coating. We expect to invest between approximately $2 and
$6 million of additional capital for certain equipment modifications and
upgrades to the facility, and we anticipate that production will begin mid-2003.
Our new Jeffersonville facility, together with our new coil-coating facility in
Butler, will enable us to further increase the mix of higher-margin value-added
downstream steel products. This value-added product mix, during 2002, was
approximately 60% of our total flat-roll shipments.

     We began construction of our new structural steel and rail mini-mill in
Columbia City, Indiana in May 2001, completed plant construction in April 2002
and commenced commercial structural steel operations during the third quarter of
2002. Our Columbia City mini-mill is designed to have an annual production
capacity of up to 1.3 million tons of structural steel beams, pilings and other
steel components for the construction, transportation and industrial machinery
markets, as well as standard and premium grade rails for the railroad industry.
Through regular product introductions and continued production ramp-up of
structural steel products, we anticipate being able to offer a full compliment
of wide flange beams and H-piling structural steel products during the first
quarter of 2003. In addition, we expect to begin production of standard rail
products during the second quarter of 2003. Initial rail production will be used
in a testing capacity to be monitored by individual railroad companies for
qualification purposes. This qualification process may take between six and nine
months.

     On September 6, 2002, we purchased the special bar quality mini-mill assets
in Pittsboro, Indiana formerly owned by Qualitech Steel SBQ LLC. We paid $45
million for these assets and currently plan to invest between $70 to $75 million
of additional capital to upgrade and modify the Pittsboro facility for the
production of merchant bars and shapes, as well as reinforcing bar products. We
may also produce some special bar quality products at this facility in the
future. After completion of remaining engineering plans and equipment
specification, as well as the issuance of the necessary operational permits, we
expect
                                        1
<PAGE>

to begin steel production in the first quarter of 2004. After modification, we
expect the Pittsboro facility to have a capacity of approximately 500,000 to
600,000 tons per year.

     On February 24, 2003, we announced that we are making plans to restart
ironmaking operations at our wholly-owned Iron Dynamics facility adjacent to our
Butler, Indiana mini-mill. Since 1997, we have tried to develop and
commercialize a pioneering process for the production of a virgin form of iron
that might serve as a lower cost substitute for a portion of the metallic raw
material mix that goes into our electric arc furnaces to be melted into new
steel. Since initial start-up in August 1999, we encountered a number of
difficulties associated with major pieces of equipment and with operating
processes and systems, and on several occasions during 1999 and 2000 shut the
facility down for redesign, re-engineering and retrofitting. In July 2001, we
suspended operations because of higher than expected start-up and process
refinement costs, high energy costs, low production quantities encountered at
that time, and then historically low steel scrap pricing existing at that time.
These factors made the cost of producing and using Iron Dynamics' scrap
substitute at our flat-rolled mini-mill higher than our cost of purchasing and
using steel scrap. We continued to make refinements to our systems and
processes, however, and began experimental production trials in the fourth
quarter of 2002. After an evaluation of these production trials, we concluded
that the improved production technology, coupled with our ability to recycle
waste materials and the current relatively high price of scrap, makes the
restart of this liquid pig iron production facility feasible. We currently
expect that the Iron Dynamics operation will restart during the second half of
2003 and, if the results of our restart indicate that we will be able to produce
liquid pig iron in sufficient quantities and at a cost to be competitive with
purchased pig iron, we could begin commercial production in late 2003. We also
anticipate that the use of this liquid pig iron raw material will provide cost
and operational benefits to our Butler, Indiana steelmaking operations. We
expect to invest approximately $14 million of additional capital for
modifications and refinements, including the installation of three additional
briquetting machines in the facility, which will enable us to stockpile iron
briquettes after reduction in the rotary hearth furnace, as well as to introduce
the hot briquettes directly into our submerged arc furnace. After the briquettes
are liquefied, the hot liquid pig iron will be transferred in ladles to the
flat-roll mill's meltshop and combined with scrap steel in the mill's electric
arc furnaces.

     On February 27, 2003, we announced that we were increasing our ownership in
our consolidated New Millennium Building Systems subsidiary from our existing
46.6% ownership to 100%, through our acquisition of (a) the 46.6% interest in
New Millennium previously held by New Process Steel Corporation, a privately
held Houston, Texas steel processor, which we have already consummated at a cost
of $3.5 million, plus the purchase of New Process Steel's portion of New
Millennium's subordinated notes payable, including accrued interest, to New
Process Steel for $3.9 million, and (b) an agreement to acquire the remaining
6.8% stake, during the first quarter of 2003, held by other minority investors.
The New Millennium facility, which began production in June of 2000, produces
steel building components, including joists, girders, trusses and steel roof and
floor decking, which we sell primarily in the upper Midwest non-residential
building components market. Our Butler flat-roll mill supplies a majority of the
hot-rolled steel utilized in New Millennium's manufacturing operations.

     Steel Dynamics, Inc. is an Indiana corporation, incorporated in August
1993, and commenced operations in January 1996. Our principal executive offices
are located at 6714 Pointe Inverness Way, Suite 200, Fort Wayne, Indiana 46804
and our telephone number is (260) 459-3553.

                                        2
<PAGE>

                                  THE OFFERING

Securities Offered............   $115,000,000 aggregate principal  amount of  4%
                                 Convertible Subordinated Notes due 2012.

Maturity Date.................   December 15, 2012.

Interest......................   4.0% per annum on the principal amount, payable
                                 semi-annually in arrears in cash on June 15 and
                                 December  15 of  each year,  beginning June 15,
                                 2003.

                                 We will  pay  contingent interest  in  addition
                                 during any six-month period from December 15 to
                                 June  14 and from June  15 to December 14, with
                                 the   initial   six-month   period   commencing
                                 December  15, 2007,  if the trading  price of a
                                 note  for  each  of   the  five  trading   days
                                 immediately  preceding  the  first  day  of the
                                 applicable six-month period equals 120% or more
                                 of the principal  amount of  such note.  During
                                 any  interest  period when  contingent interest
                                 shall  be  payable,  the  contingent   interest
                                 payable  per note  will be  an amount  equal to
                                 0.25% of the average  trading price per  $1,000
                                 principal  amount  of  notes  during  the  five
                                 trading days  immediately preceding  the  first
                                 day   of  the   applicable  six-month  interest
                                 period.

Conversion....................   You may convert your  notes into shares of  our
                                 common    stock    in   only    the   following
                                 circumstances:

                                 -  at any time after the closing sale price  of
                                    our   common  stock  exceeds   120%  of  the
                                    conversion price  for  at least  20  trading
                                    days  in  the  30  consecutive  trading days
                                    ending on the last trading day of any fiscal
                                    quarter commencing after December 31,  2002;
                                    or

                                 -  after  the earlier of (a) the date the notes
                                    are rated by both  Standard & Poor's  Credit
                                    Market   Services,   a   division   of   the
                                    McGraw-Hill Companies, and Moody's  Investor
                                    Services,  Inc.  and (b)  January  31, 2003,
                                    during any period that the long-term  credit
                                    rating  assigned  to  the  notes  by  either
                                    Standard  &  Poor's   or  Moody's  (or   any
                                    successors  to these  entities) is  "CCC" or
                                    "Caa3", respectively, or lower, or if either
                                    of these rating agencies no longer rates the
                                    notes, or if either of these rating agencies
                                    suspends or withdraws the rating assigned to
                                    the notes, or if the notes are not  assigned
                                    a rating by both rating agencies; or

                                 -  if   the   notes   have   been   called  for
                                    redemption; or

                                 -  upon the occurrence  of specified  corporate
                                    events   described  under   "Description  of
                                    Notes."

                                 The initial conversion rate will be 58.8076
                                 shares of our common stock for each $1,000
                                 principal amount of notes converted (equivalent
                                 to an initial conversion price of approximately
                                 $17.0046 per share). The conversion rate may be
                                 adjusted for certain reasons, but will not be
                                 adjusted for accrued interest. Upon conversion,
                                 you will not receive any cash payment
                                 representing accrued interest except in the
                                 limited circumstances described under
                                 "Description of the Notes --Conversion of

                                        3
<PAGE>

                                 Notes." Instead,  accrued and  unpaid  interest
                                 will  be  deemed paid  by  the delivery  of the
                                 shares of common stock (or cash in lieu of such
                                 shares) which you receive on conversion.

                                 The ability to  surrender notes for  conversion
                                 will   expire  at  the  close  of  business  on
                                 December 15, 2012.

Redemption....................   We  may  redeem  any  of  the  notes  beginning
                                 December  18, 2007,  by giving you  at least 30
                                 days' notice. We may redeem the notes either in
                                 whole  or  in  part  at  redemption  prices  as
                                 described in this prospectus under "Description
                                 of   Notes   --Optional  Redemption   by  Steel
                                 Dynamics," plus accrued and unpaid interest.

Fundamental Change............   If a  fundamental  change (as  described  under
                                 "Description of Notes --Repurchase at Option of
                                 the  Holder Upon a  Fundamental Change") occurs
                                 prior  to  maturity,  you  may  require  us  to
                                 repurchase  all  or  part of  your  notes  at a
                                 repurchase  price  equal   to  100%  of   their
                                 principal   amount,  plus  accrued  and  unpaid
                                 interest.

Repurchase at the Option of
the Holder....................   You may  require  us  to repurchase  all  or  a
                                 portion  of your notes for cash on December 15,
                                 of 2009 at a repurchase price equal to 100%  of
                                 their principal amount, plus accrued and unpaid
                                 interest.

Subordination.................   The  notes are subordinated in right of payment
                                 to  all  of  our  existing  and  future  senior
                                 indebtedness.   In  addition,   the  notes  are
                                 effectively subordinated to all debt and  other
                                 liabilities  of our  subsidiaries. After giving
                                 effect to  the issuance  of the  notes and  the
                                 repayment  of  indebtedness  under  our  senior
                                 secured credit facilities with the net proceeds
                                 from the notes,  as of September  30, 2002,  we
                                 would  have  had $440  million  of consolidated
                                 debt outstanding other than  the notes, all  of
                                 which  are senior  in right  of payment  to the
                                 notes.

Use of Proceeds...............   We will not  receive any of  the proceeds  from
                                 the  sale by the selling securityholders of the
                                 notes  or  the   common  stock  issuable   upon
                                 conversion of the notes.

Registration Rights...........   We  have  filed  with  the  SEC  a registration
                                 statement, of which this prospectus is a  part,
                                 pursuant  to  a  registration  rights agreement
                                 with the initial  purchasers of  the notes.  We
                                 have  also  agreed to  use our  reasonable best
                                 efforts  to  have  the  registration  statement
                                 declared  effective within 180 days of the date
                                 of filing and,  subject to certain  exceptions,
                                 to  use our reasonable best efforts to keep the
                                 shelf registration  statement  effective  until
                                 either of the following has occurred:

                                 - all  securities  covered by  the registration
                                   statement have been sold; or

                                 - the  expiration  of  the  applicable  holding
                                   period  with  respect  to the  notes  and the
                                   underlying common  stock  under  Rule  144(k)
                                   under  the  Securities  Act of  1933,  or any
                                   successor provision.

                                        4
<PAGE>

United States Federal Income
Tax Considerations............   The notes are debt  instruments subject to  the
                                 United  States  federal  income  tax contingent
                                 payment   debt    regulations.    Under    such
                                 regulations,   even  if  we   do  not  pay  any
                                 contingent interest on the notes, a  beneficial
                                 owner  of the  notes who  is a  U.S. holder, as
                                 defined  below  under  "Certain  United  States
                                 Federal  Income  Tax  Considerations,"  will be
                                 required to include interest, which we refer to
                                 as tax  original issue  discount, at  the  rate
                                 described  below in its gross income for United
                                 States federal income tax purposes,  regardless
                                 of  whether such owner uses the cash or accrual
                                 method of tax accounting. This imputed interest
                                 will accrue at a rate equal to 9.25% per  year,
                                 computed on a semiannual bond equivalent basis,
                                 which    represents    the    yield    on   our
                                 noncontingent, nonconvertible, fixed-rate  debt
                                 with  terms and conditions otherwise similar to
                                 those of  the notes.  The  rate at  which  this
                                 imputed  interest will accrue for United States
                                 federal income  tax  purposes will  exceed  the
                                 stated cash interest payable on the notes.

                                 Each holder of the notes will recognize gain or
                                 loss  on the sale, exchange,  purchase by us at
                                 the holder's option, conversion, redemption  or
                                 retirement  of a note in an amount equal to the
                                 difference   between   the   amount   realized,
                                 including  the fair market  value of any common
                                 stock  received   upon  conversion,   and   the
                                 holder's  adjusted tax basis  in the notes. Any
                                 gain  recognized  by  a  holder  on  the  sale,
                                 exchange,   purchase  by  us  at  the  holder's
                                 option, conversion, redemption or retirement of
                                 a note  generally  will  be  ordinary  interest
                                 income;  any  loss generally  will  be ordinary
                                 loss to the extent  of the interest  previously
                                 included  in  income,  and  thereafter, capital
                                 loss. Holders should consult their tax advisers
                                 as to the United  States federal, state,  local
                                 or  other tax consequences of acquiring, owning
                                 and disposing of the notes. See "Certain United
                                 States Federal Income Tax Considerations."

Trading.......................   The notes  originally  issued  in  the  private
                                 placement  are  eligible  for  trading  on  The
                                 Private Offerings, Resales and Trading  Through
                                 Automated  Linkages, or "PORTAL  Market" of the
                                 National  Association  of  Securities  Dealers,
                                 Inc.  However,  notes  sold  pursuant  to  this
                                 prospectus  will  no  longer  be  eligible  for
                                 trading  on the PORTAL Market. We do not intend
                                 to list the  notes on  any national  securities
                                 exchange.

     For a more complete description of the terms of the notes, see "Description
of Notes." For a description of our common stock, see "Description of Capital
Stock," including the documents incorporated by reference in this prospectus
that are referred to in that section.

                                        5
<PAGE>

                                  RISK FACTORS

     You should carefully consider the risks described below before making an
investment decision. The risks described below are not the only ones facing our
company. Additional risks not presently known to us or that we currently deem
immaterial may also impair our business operations.

     Our business, financial condition or results of operations could be
materially adversely affected by any of these risks. The trading price of the
notes could decline due to any of these risks, and you may lose all or part of
your investment.

     This prospectus and the information incorporated by reference herein also
contain forward-looking statements that involve risks and uncertainties. Our
actual results could differ materially from those anticipated in these
forward-looking statements as a result of certain factors, including the risks
faced by us described below and elsewhere in this prospectus.

RISKS RELATED TO OUR INDUSTRY

  IN RECENT YEARS, IMPORTS OF STEEL INTO THE UNITED STATES HAVE ADVERSELY
  AFFECTED, AND MAY AGAIN ADVERSELY AFFECT, U.S. STEEL PRICES, WHICH WOULD
  IMPACT OUR SALES, MARGINS AND PROFITABILITY

     Excessive imports of steel into the United States have in recent years, and
may again in the future, exert downward pressure on U.S. steel prices and
significantly reduce our sales, margins and profitability. U.S. steel producers
compete with many foreign producers. Competition from foreign producers is
typically strong, but it has greatly increased as a result of an excess of
foreign steelmaking capacity and a weakening of certain foreign economies,
particularly in Eastern Europe, Asia and Latin America. The economic
difficulties in these countries have resulted in lower local demand for steel
products and have tended to encourage greater steel exports to the United States
at depressed prices.

     In addition, we believe the downward pressure on, and depressed levels of,
U.S. steel prices in recent years have been further exacerbated by imports of
steel involving dumping and subsidy abuses by foreign steel producers. Some
foreign steel producers are owned, controlled or subsidized by foreign
governments. As a result, decisions by these producers with respect to their
production, sales and pricing are often influenced to a greater degree by
political and economic policy considerations than by prevailing market
conditions, realities of the marketplace or consideration of profit or loss. For
example, between 1998 and 2001, when imports of hot-rolled and cold-rolled
products increased dramatically, domestic steel producers, including us, were
adversely affected by unfairly priced or "dumped" imported steel. Even though
various protective actions taken by the U.S. government during 2001, including
the enactment of various steel import quotas and tariffs, have resulted in an
abatement of some steel imports during 2002, these protective measures are only
temporary. When these measures expire or if they are relaxed, or if increasingly
higher U.S. steel prices enable foreign steelmakers to export their steel
products into the United States even with the presence of tariffs, the
resurgence of substantial imports of foreign steel could again create downward
pressure on U.S. steel prices. In addition, domestic steel companies, as well as
labor unions, have filed complaints with the International Trade Commission and
the U.S. Department of Commerce against certain hot-rolled, cold-rolled and
structural steel imports. In June of 2002, the ITC made final negative injury
determinations in cases relating to structural steel imports from China,
Germany, Italy, Luxembourg, Russia, South Africa, Spain and Taiwan. In addition,
in August and October of 2002, the ITC also made final negative injury
determinations in all outstanding cases relating to cold-rolled steel, thus
ending the investigations without the imposition of duties. These negative
determinations may increase the amount of cold-rolled and structural steel
imports into the United States and may create further downward pressure on U.S.
steel prices. In June of 2002, the United States granted "market economy" status
to Russia, which may enable Russia to more effectively defend itself against
dumping actions and increase the risk that Russia in the future may dump steel
into the U.S. market, which may adversely affect U.S. steel prices. We refer you
to "Business -- The Steel Industry" in our Annual Report on Form 10-K for the
year ended December 31, 2001 for additional information.

                                        6
<PAGE>

 INTENSE COMPETITION AND EXCESS GLOBAL CAPACITY IN THE STEEL INDUSTRY MAY
 CONTINUE TO EXERT DOWNWARD PRESSURE ON OUR PRICING

     We may not be able to compete effectively in the future as a result of
intense competition. Competition within the steel industry, both domestically
and worldwide, is intense and it is expected to remain so. We compete primarily
on the basis of (1) price, (2) quality and (3) the ability to meet our
customers' product needs and delivery schedules. Our primary competitors are
other mini-mills, which may have cost structures and management cultures more
similar to ours than integrated mills. We also compete with many integrated
producers of hot-rolled, cold-rolled and coated products, many of which are
larger and have substantially greater capital resources. The highly competitive
nature of the industry, in part, exerts downward pressure on prices for some of
our products. Further, over the past few years, approximately 30 domestic steel
producers have entered bankruptcy proceedings. In some cases, these previously
marginal producers have been able to emerge from bankruptcy reorganization with
lower and more competitive cost structures. In other cases, steelmaking assets
have been sold through bankruptcy proceedings to other steelmakers or to new
companies, at greatly depressed prices. The reemergence of these producers or
their successors may further increase the competitive environment in the steel
industry and contribute to price declines. In the case of certain product
applications, steel competes with other materials, including plastic, aluminum,
graphite composites, ceramics, glass, wood and concrete.

     In addition, global overcapacity in steel manufacturing and its negative
impact on U.S. steel pricing are likely to continue to persist and could have a
negative impact on our sales, margins and profitability. The U.S. steel industry
continues to be adversely impacted by excess global steel manufacturing
capacity. Over the last decade, the construction of new mini-mills, expansion
and improved production efficiencies of some integrated mills and substantial
expansion of foreign steel capacity have all led to the excess of manufacturing
capacity. Increasingly, this overcapacity, combined with the high levels of
steel imports into the United States, has exerted downward pressure on domestic
steel prices, including the prices of our products, and has resulted in, at
times, a dramatic narrowing, or with many companies the elimination, of gross
margins.

 THE POSITIVE EFFECTS OF PRESIDENT BUSH'S MARCH 5, 2002 ORDER IN CONTRIBUTING TO
 THE REDUCTION OF EXCESSIVE IMPORTS OF STEEL INTO THE UNITED STATES MAY BE
 LESSENED IF THERE ARE SUCCESSFUL APPEALS TO THE WORLD TRADE ORGANIZATION BY THE
 EXPORTING COUNTRIES OR IF DOMESTIC OR INTERNATIONAL POLITICAL PRESSURE RESULTS
 IN A RELAXATION OF, OR SUBSTANTIAL EXEMPTIONS FROM, THE TARIFFS CONTAINED IN
 THE ORDER

     If the amount, scope or duration of the Section 201 orders are lessened or
adversely changed, it could lead to a resurgence of flat-rolled steel imports,
an increase of steel slab imports and/or an increase in welded pipe and tube
imports. Any of these results would again put downward pressure on U.S.
flat-rolled prices which would negatively impact our sales, margins and
profitability. On June 22, 2001, the Bush Administration requested that the
International Trade Commission, or ITC, initiate an investigation under Section
201 of the Trade Act of 1974 to determine whether steel is being imported into
the United States in such quantities as to be a substantial cause of serious
injury to the U.S. steel industry. In October 2001, the ITC found "serious
injury" due to imports of steel products, including the products we manufacture,
and in December 2001, the ITC recommended that the President impose tariffs of
approximately 20%-40%, as well as tariff quotas in connection with certain
products such as steel slabs. On March 5, 2002, President Bush, among other
actions, imposed a three year tariff of 30% for the first year, 24% for the
second year and 18% for the third year on imports of hot-rolled, cold-rolled and
coated sheet, as well as on imports of steel slabs in excess of a specified
annual quota. North American Free Trade Agreement partners of the United States,
principally Canada and Mexico, are excluded from these tariffs, as are
"developing countries" that account for less than 3% of imported steel.
Increased imports from these excluded countries may reduce the benefit from
these tariffs to U.S. steel producers, including us.

     Imports of flat-rolled steel have declined, in part, due to the imposition
of dumping duties that have been imposed on certain imports of foreign steel,
and, in part, due to the imposition of significant tariffs as a result of this
Section 201 action. These events have, in part, allowed us to begin restoring
prices on flat-rolled products. While the President's decision to implement a
Section 201 remedy is not appealable to
                                        7
<PAGE>

U.S. courts, foreign governments may appeal, and some have appealed, to the
World Trade Organization, or WTO. The European Union, Japan and other countries
are currently prosecuting such appeals. These dispute settlement proceedings at
the WTO and further appeals to the Appellate Body of the WTO generally take
15-24 months. These appeals were filed in April of 2002 and may be concluded by
the end of 2003. Moreover, a number of affected countries have threatened to
impose various retaliatory tariffs on U.S. steel or other products or have
sought various product exemptions from the imposition of the tariffs.
Accordingly, there is a risk that rulings adverse to the United States or
substantial political pressures could result in the President changing the
remedy, granting substantial exemptions from the remedy, or terminating the
remedy entirely prior to the full three years, although any such modification
would apply only prospectively.

 OUR LEVEL OF PRODUCTION AND OUR SALES AND EARNINGS ARE SUBJECT TO SIGNIFICANT
 FLUCTUATIONS AS A RESULT OF THE CYCLICAL NATURE OF THE STEEL INDUSTRY AND THE
 INDUSTRIES WE SERVE

     The price of steel and steel products may fluctuate significantly due to
many factors beyond our control. This fluctuation directly affects the levels of
our production and our sales and earnings. The steel industry is highly
cyclical, sensitive to general economic conditions and dependent on the
condition of certain other industries. The demand for steel products is
generally affected by macroeconomic fluctuations in the United States and global
economies in which steel companies sell their products. For example, future
economic downturns, stagnant economies or currency fluctuations in the United
States or globally could decrease the demand for our products or increase the
amount of imports of steel into the United States either event of which would
decrease our sales, margins and profitability.

     In addition, a disruption or downturn in the automotive, oil and gas, gas
transmission, construction, commercial equipment, rail transportation,
appliance, agricultural and durable goods industries could negatively impact our
financial condition, production, sales, margins and earnings. We are also
particularly sensitive to trends and events, including strikes and labor unrest
that may impact these industries. These industries are significant markets for
our products and are themselves highly cyclical.

RISKS RELATED TO OUR BUSINESS

 TECHNOLOGY, OPERATING AND START-UP RISKS ASSOCIATED WITH OUR IRON DYNAMICS
 SCRAP SUBSTITUTE PROJECT MAY PREVENT US FROM REALIZING THE ANTICIPATED BENEFITS
 FROM THIS PROJECT AND COULD RESULT IN A LOSS OF OUR INVESTMENT

     If we abandon our Iron Dynamics project, or if its process does not
succeed, we will not be able to realize the expected benefits of this project
and will suffer the loss of our entire investment. As of December 31, 2002, our
investment in the Iron Dynamics project was $160 million. Since 1997, our
wholly-owned subsidiary, Iron Dynamics, has tried to develop and commercialize a
pioneering process of producing a virgin form of iron that might serve as a
lower cost substitute for a portion of the metallic raw material mix that goes
into our electric arc furnaces to be melted into new steel. This scrap
substitute project is the first of its kind. It involves processes that are
based on various technical assumptions and new applications of technologies that
have yet to be commercially proven. Since our initial start-up in August 1999,
we have encountered a number of difficulties associated with major pieces of
equipment and with operating processes and systems. Throughout the latter part
of each of 1999 and 2000, our Iron Dynamics facility was shut down. During these
shut downs, we engaged in time consuming and expensive redesign, re-engineering,
reconstruction and retrofitting of major pieces of equipment, systems and
processes. As a result, the Iron Dynamics project has taken considerably longer
and has required us to expend considerably greater resources than originally
anticipated. While we made significant progress during these shut downs in
correcting various technical and other deficiencies, we have not yet been
successful in achieving the results necessary to bring production output up and
product costs down to the point of being commercially competitive. In February
2001, we re-started operations at our Iron Dynamics

                                        8
<PAGE>

facility. However, in July 2001, we suspended these operations again, with no
specific date set for resumption of operations. This shut down was a result of:

     (1) higher than expected start-up and process refinement costs;

     (2) exceptionally high energy costs;

     (3) low production quantities achieved at the Iron Dynamics facility; and

     (4) historically low steel scrap pricing.

     These factors made the cost of producing and using Iron Dynamics scrap
substitute at our flat-rolled mini-mill higher than our cost of purchasing and
using steel scrap. Furthermore, we believe that, even with additional
development and refinement to the equipment, technology systems and processes,
the Iron Dynamics facility may only be able to achieve monthly output levels
between 75%-85% of our original estimates, resulting in higher unit costs than
originally planned. We currently estimate that these additional developments and
refinements will cost approximately $14 million. On July 10, 2002, we announced
that we would begin experimental production trials in the fourth quarter of
2002. During the fourth quarter of 2002, we successfully completed certain
trials. On February 24, 2003, we announced that we are making plans to restart
our ironmaking operations during the second half of 2002. If the results of this
restart indicate that we will be able to produce liquid pig iron in sufficient
quantities and at a cost to be competitive with purchased pig iron, we could
begin commercial production in late 2003. However, Iron Dynamics may never
become commercially operational.

     In addition, while we remain optimistic that the remaining start-up
difficulties with the equipment, technology, systems and processes can be
resolved, our Iron Dynamics facility may not be able to consistently operate or
be able to produce steel scrap substitute material in the quantities that will
enable it to be cost competitive. Moreover, in connection with any restart of
operations, our Iron Dynamics facility may experience additional shutdowns or
equipment failures and such shutdowns or failures may have a material adverse
impact on our liquidity cost structure and earnings.

 A SUBSTANTIAL PORTION OF OUR FLAT-ROLLED PRODUCTS ARE SOLD ON THE SPOT MARKET,
 AND THEREFORE, OUR SALES, MARGINS AND EARNINGS ARE NEGATIVELY IMPACTED BY
 DECREASES IN DOMESTIC FLAT-ROLLED STEEL PRICES

     Our sales, margins and earnings are negatively impacted by decreases in
domestic flat-rolled steel prices since a significant portion of our flat-rolled
products are sold on the spot market. As a result, we are vulnerable to
downturns in the domestic flat-rolled steel market. For the three year period
ended December 31, 2002, approximately 80% of our flat-roll products were sold
on the spot market under contracts with terms of twelve months or less.

 WEAKNESS IN THE AUTOMOTIVE INDUSTRY WOULD RESULT IN A SUBSTANTIAL REDUCTION IN
 DEMAND FOR OUR PRODUCTS

     A prolonged weakness in the automotive industry would reduce the demand for
our products and decrease our sales. In addition, if automobile manufacturers
choose to incorporate more plastics, aluminum and other steel substitutes in
their automobiles, it could reduce demand for our products. Our sales and
earnings fluctuate due to the cyclical nature of the automotive industry. The
cyclical nature of the automotive industry is affected by such things as the
level of consumer spending, the strength or weakness of the U.S. dollar and the
impact of international trade and various factors, such as labor unrest and the
availability of raw materials, which affect the ability of the automotive
industry to actually build cars. While we do not presently sell a material
portion of our steel production directly to the automotive market, a substantial
portion of our sales to the intermediate steel processor and service center
market is resold to various companies in the automotive industry.

                                        9
<PAGE>

 WE MAY BE UNABLE TO PASS ON INCREASES IN THE COST OF SCRAP AND OTHER RAW
 MATERIALS TO OUR CUSTOMERS WHICH WOULD REDUCE OUR EARNINGS

       If we are unable to pass on higher scrap and other raw material costs to
our customers we will be less profitable. We may not be able to adjust our
product prices, especially in the short-term, to recover the costs of increases
in scrap and other raw material prices. Our principal raw material is scrap
metal derived primarily from junked automobiles, industrial scrap, railroad
cars, railroad track materials, agricultural machinery and demolition scrap from
obsolete structures, containers and machines. The prices for scrap are subject
to market forces largely beyond our control, including demand by U.S. and
international steel producers, freight costs and speculation. The prices for
scrap have varied significantly, are currently relatively high, may continue to
vary significantly in the future and do not necessarily fluctuate in tandem with
the price of steel. In addition, our operations require substantial amounts of
other raw materials, including various types of pig iron, alloys, refractories,
oxygen, natural gas and electricity, the price and availability of which are
also subject to market conditions.

 WE HAVE PRIMARILY RELIED UPON ONE SUPPLIER TO MEET OUR STEEL SCRAP REQUIREMENTS

     Since our inception, we have had an exclusive contract with OmniSource, one
of the largest scrap processors and brokers in the Midwest, to purchase steel
scrap. Our current agreement with OmniSource expires on December 31, 2004.
However, OmniSource may terminate the agreement at anytime on or after July 1,
2003. If the contract terminates for any reason, we would have to find another
supplier for steel scrap or develop our own scrap purchasing capability. We may
be unable to secure substitute arrangements for steel scrap on the same or
better terms as those in our contract with OmniSource. In addition, if our
contract is adversely changed for any reason, we may experience an increase in
our cost of goods sold.

     For the years ended December 31, 2001 and 2002, we purchased 1.5 million
tons and 2.1 million tons, respectively, of steel scrap and scrap substitutes
from OmniSource which represented approximately 87% and 82%, respectively, of
our total scrap tons purchased during those periods.

 THERE MAY BE POTENTIAL CONFLICTS OF INTEREST WITH REGARD TO OUR RELATIONSHIP
 WITH OMNISOURCE

     With respect to any dispute between us and OmniSource involving our
existing contract, including its remaining term, any future contract, or in
connection with the terms of any commercial transaction, OmniSource may be
viewed as having a conflict of interest between what it perceives as being best
for itself as a seller of scrap and what is best for us as a buyer of scrap. We
may not be able to resolve potential conflicts and if we do resolve them, we may
receive a less favorable resolution since we are dealing with OmniSource rather
than an unaffiliated person. The chairman of the board and chief executive
officer of OmniSource is also a member of our board of directors and is a
substantial stockholder of Steel Dynamics. This person has obligations to us as
well as to OmniSource and may have conflicts of interest with respect to matters
potentially or actually involving or affecting us and OmniSource. OmniSource
also supplies scrap to many other customers, including other steel mills.

 WE RELY UPON A SMALL NUMBER OF MAJOR CUSTOMERS FOR A SUBSTANTIAL PERCENTAGE OF
 OUR SALES

     A loss of any large customer or group of customers could materially reduce
our sales and earnings. We have substantial business relationships with a few
large customers. For the years ended December 31, 2001 and 2002, our Butler
mini-mill's top ten customers accounted for approximately 48% and 54% of our
total net sales, respectively. During those periods, our largest customer,
Heidtman, accounted for approximately 18% and 17% of our total net sales. We
expect to continue to depend upon a small number of customers for a significant
percentage of our total net sales, and cannot assure you that any of them will
continue to purchase steel from us.

                                        10
<PAGE>

 THERE MAY BE POTENTIAL CONFLICTS OF INTEREST WITH REGARD TO OUR RELATIONSHIP
 WITH HEIDTMAN STEEL PRODUCTS, INC.

     If a dispute arises between us and Heidtman, we may be viewed as having a
conflict of interest. What is best for Heidtman as a buyer and what is best for
us as a product seller may be at odds. We may be unable to resolve potential
conflicts. If we do resolve them, we may receive a less favorable resolution
since we are dealing with Heidtman rather than an unaffiliated person. Heidtman
is an affiliate of one of our large stockholders and its president and chief
executive officer serves as one of our directors. This person has obligations to
us as well as to Heidtman and may have conflicts of interest with respect to
matters potentially or actually involving or affecting us and Heidtman.

 START-UP AND OPERATING RISKS ASSOCIATED WITH THE CONSTRUCTION OF OUR COLUMBIA
 CITY STRUCTURAL STEEL AND RAIL MINI-MILL COULD RESULT IN MATERIALLY GREATER
 OPERATING COSTS THAN THOSE WE HAVE ANTICIPATED

     Start-up and operating risks associated with the construction of our
Columbia City mini-mill may result in materially greater operating costs than we
initially expected. At our Columbia City mini-mill, we are subject to all of the
general risks associated with the construction and start-up of a new mini-mill.
These risks involve construction delays, cost overruns and start-up
difficulties. We could also experience operational difficulties after start-up
that could result in our inability to operate our Columbia City mini-mill at
full or near full capacity or at all.

 UNEXPECTED EQUIPMENT FAILURES MAY LEAD TO PRODUCTION CURTAILMENTS OR SHUTDOWNS

     Interruptions in our production capabilities will inevitably increase our
production costs, and reduce our sales and earnings for the affected period. In
addition to equipment failures, our facilities are also subject to the risk of
catastrophic loss due to unanticipated events such as fires, explosions or
violent weather conditions. Our manufacturing processes are dependent upon
critical pieces of steelmaking equipment, such as our furnaces, continuous
casters and rolling equipment, as well as electrical equipment, such as
transformers, and this equipment may, on occasion, be out of service as a result
of unanticipated failures. We have experienced and may in the future experience
material plant shutdowns or periods of reduced production as a result of such
equipment failures.

 WE DEPEND HEAVILY ON OUR SENIOR MANAGEMENT AND WE MAY BE UNABLE TO REPLACE KEY
 EXECUTIVES IF THEY LEAVE

     The loss of the services of one or more members of our senior management
team or our inability to attract, retain and maintain additional senior
management personnel could harm our business, financial condition, results of
operations and future prospects. Our senior management founded our company,
pioneered the development of thin-slab, flat-rolled technology and directed the
construction of our Butler mini-mill and Columbia City structural mini-mill. Our
operations and prospects depend in large part on the performance of our senior
management team, including Keith E. Busse, president and chief executive
officer, Mark D. Millett, vice president and general manager of our flat-roll
division, Richard P. Teets, Jr., vice president and general manager of our
structural division, Tracy L. Shellabarger, vice president and chief financial
officer and John W. Nolan, vice president, sales and marketing. Although these
senior managers have each been employees and stockholders of Steel Dynamics for
more than seven years, these individuals may not remain with us as employees. In
addition, we may not be able to find qualified replacements for any of these
individuals if their services are no longer available. We do not have key man
insurance on any of these individuals.

 WE MAY FACE RISKS ASSOCIATED WITH THE IMPLEMENTATION OF OUR GROWTH STRATEGY

     Our growth strategy subjects us to various risks. As part of our growth
strategy, we may expand our existing facilities, build additional plants,
acquire other businesses and steel assets, enter into joint

                                        11
<PAGE>

ventures, or form strategic alliances that we believe will complement our
existing business. These transactions will likely involve some or all of the
following risks:

     - the difficulty of competing for acquisitions and other growth
       opportunities with companies having materially greater financial
       resources than ours;

     - the difficulty of integrating the acquired operations and personnel into
       our existing business;

     - the potential disruption of our ongoing business;

     - the diversion of resources;

     - the inability of management to maintain uniform standards, controls,
       procedures and polices;

     - the difficulty of managing the growth of a larger company;

     - the risk of entering markets in which we have little experience;

     - the risk of becoming involved in labor, commercial, or regulatory
       disputes or litigation related to the new enterprise;

     - the risk of contractual or operational liability to our venture
       participants or to third parties as a result of our participation;

     - the inability to work efficiently with joint venture or strategic
       alliance partners; and

     - the difficulties of terminating joint ventures or strategic alliances.

     These transactions might be required for us to remain competitive, but we
may not be able to complete any such transactions on favorable terms or obtain
financing, if necessary, for such transactions on favorable terms. Future
transactions may not improve our competitive position and business prospects as
anticipated, and if they do not, our sales and earnings may be significantly
reduced.

 WE MAY BE DELAYED IN THE CONSTRUCTION AND START-UP OF OUR PITTSBORO, INDIANA
 MINI-MILL

     On September 6, 2002, we purchased, through our wholly owned subsidiary,
Dynamic Bar Products, LLC, Qualitech Steel SBQ LLC's special bar quality
mini-mill assets located in Pittsboro, Indiana for $45 million, and we have
announced plans to invest between $60 to $70 million in plant upgrades and
retrofitting to convert the facility from one capable of producing only special
bar quality steel products to a facility capable of producing merchant bars and
shapes and reinforcing bar products.

     It may cost more than the $60 to $70 million we estimate is required to
convert the Pittsboro mini-mill into a mini-mill for the production of merchant
and reinforcing bar. We are also subject to regulatory approval and to
construction and start-up delays and operational risks associated with the
start-up of a new mini-mill, either in the Pittsboro mini-mill's present
configuration or in connection with its conversion. The factors could result in
materially greater operating costs than we initially expected. We may also be
delayed either as a result of other unforeseen circumstances or events beyond
our control.

 ENVIRONMENTAL REGULATION IMPOSES SUBSTANTIAL COSTS AND LIMITATIONS ON OUR
 OPERATIONS

     We are subject to the risk of substantial environmental liability and
limitations on our operations brought about by the requirements of environmental
laws and regulations. We are subject to various federal, state and local
environmental, health and safety laws and regulations concerning such issues as
air emissions, wastewater discharges, solid and hazardous waste handling and
disposal, and the investigation and remediation of contamination. These laws and
regulations are increasingly stringent. While we believe that our facilities are
and will continue to be in material compliance with all applicable environmental
laws and regulations, the risks of substantial costs and liabilities related to
compliance with such laws and regulations are an inherent part of our business.
Although we are not currently involved in any remediation activities, it is
possible that future conditions may develop, arise or be discovered that create
substantial environmental remediation liabilities and costs. For example, our
steelmaking operations produce certain

                                        12
<PAGE>

waste products, such as electric arc furnace dust, which are classified as
hazardous waste and must be properly disposed of under applicable environmental
laws. These laws can impose clean up liability on generators of hazardous waste
and other substances that are shipped off-site for disposal, regardless of fault
or the legality of the disposal activities. Other laws may require us to
investigate and remediate contamination at our properties, including
contamination that was caused in whole or in part by third parties. While we
believe that we can comply with environmental legislation and regulatory
requirements and that the costs of doing so have been included within our
budgeted cost estimates, it is possible that such compliance will prove to be
more limiting and costly than anticipated. In addition, we need to obtain the
air permit for our coil coating facility at our Butler mini-mill, which we
expect to be issued in the near future, and the air permit for our Pittsboro
mini-mill for which we have yet to make an application. There is no guarantee
that we will obtain these permits and any failure to do so could adversely
affect our business.

     In addition to potential clean up liability, in the past we have been, and
in the future we may become, subject to substantial monetary fines and penalties
for violation of applicable laws, regulations or administrative conditions. The
United States Environmental Protection Agency is currently seeking $273,900 in
civil penalties from us for alleged violations of the Emergency Planning and
Community Right-to-Know Act, the Comprehensive Environmental Response,
Compensation and Liability Act, the Clean Water Act and the Resource
Conservation and Recovery Act, in connection with one or more accidental
releases of spent pickle liquor on our Butler mini-mill site and into adjacent
waterways in January 1999. We may also be subject from time to time to legal
proceedings brought by private parties or governmental agencies with respect to
environmental matters, including matters involving alleged property damage or
personal injury.

RISKS RELATED TO THE NOTES

 WE HAVE SUBSTANTIAL INDEBTEDNESS AND DEBT SERVICE REQUIREMENTS WHICH LIMITS OUR
 FINANCIAL AND OPERATING FLEXIBILITY

     After giving effect to the issuance of the notes and the repayment of
indebtedness under our senior secured credit facilities with the net proceeds
from the notes, as of September 30, 2002, we would have had $555 million of
indebtedness, which would have represented approximately 52% of our total
consolidated capitalization, including current maturities of long-term debt.

     Our substantial indebtedness limits our financial and operating
flexibility. For example, it could:

     - make it more difficult to satisfy our obligations with respect to our
       debt, including the notes;

     - limit our ability to obtain additional financing for working capital,
       capital expenditures, acquisitions or general corporate purposes;

     - require us to dedicate a substantial portion of our cash flow from
       operations to payments on our debt, reducing our ability to use these
       funds for other purposes;

     - limit our ability to adjust rapidly to changing market conditions; and

     - increase our vulnerability to downturns in general economic conditions or
       in our business.

     Our ability to satisfy our debt obligations will depend upon our future
operating performance, which in turn will depend upon the successful
implementation of our strategy and upon financial, competitive, regulatory,
technical and other factors, many of which are beyond our control. If we are not
able to generate sufficient cash from operations to make payments under our
credit agreements or to meet our other debt service obligations, we will need to
refinance our indebtedness. Our ability to obtain such financing will depend
upon our financial condition at the time, the restrictions in the agreements
governing our indebtedness and other factors, including general market and
economic conditions. If such refinancing were not possible, we could be forced
to dispose of assets at unfavorable prices. Even if we could obtain such
financing, we cannot be sure that it would be on terms that are favorable to us.
In addition, we could default on our debt obligations.
                                        13
<PAGE>

 OUR SENIOR SECURED CREDIT AGREEMENT AND THE INDENTURE RELATING TO OUR 9 1/2%
 SENIOR NOTES DUE 2009 CONTAIN RESTRICTIVE COVENANTS THAT MAY LIMIT OUR
 FLEXIBILITY

     Restrictions and covenants in our existing debt agreements, including our
senior secured credit agreement and the indenture relating to our 9 1/2% senior
notes due 2009, and any future financing agreements, may impair our ability to
finance future operations or capital needs or to engage in other business
activities. Specifically, these agreements will restrict our ability to:

     - incur additional indebtedness;

     - pay dividends or make distributions with respect to our capital stock;

     - repurchase or redeem capital stock;

     - make investments;

     - create liens and enter into sale and leaseback transactions;

     - make capital expenditures;

     - enter into transactions with affiliates or related persons;

     - issue or sell stock of certain subsidiaries;

     - sell or transfer assets; and

     - participate in certain joint ventures, acquisitions or mergers.

     A breach of any of the restrictions or covenants in our debt agreements
could cause a default under our senior secured credit agreement, the 9 1/2%
senior notes due 2009, other debt or the notes. A significant portion of our
indebtedness then may become immediately due and payable. We are not certain
whether we would have, or be able to obtain, sufficient funds to make these
accelerated payments, including payments on the notes.

 WE MAY NOT HAVE SUFFICIENT CASH FLOW TO MAKE PAYMENTS ON THE NOTES AND OUR
 OTHER DEBT

     Our ability to pay principal and interest on the notes and our other debt
and to fund our planned capital expenditures depends on our future operating
performance. Our future operating performance is subject to a number of risks
and uncertainties that are often beyond our control, including general economic
conditions and financial, competitive, regulatory and environmental factors. For
a discussion of some of these risks and uncertainties, please see "Risk
Factors -- Risks Related to Our Business" and "-- Risks Related to Our
Industry." Consequently, we cannot assure you that we will have sufficient cash
flow to meet our liquidity needs, including making payments on our indebtedness.

     If our cash flow and capital resources are insufficient to allow us to make
scheduled payments on your notes or our other debt, we may have to sell assets,
seek additional capital or restructure or refinance our debt. We cannot assure
you that the terms of our debt will allow for these alternative measures or that
such measures would satisfy our scheduled debt service obligations.

     If we cannot make scheduled payments on our debt:

     - our debtholders could declare all outstanding principal and interest to
       be due and payable;

     - the lenders under our senior secured credit agreement could terminate
       their commitments and commence foreclosure proceedings against our
       assets;

     - we could be forced into bankruptcy or liquidation; and

     - you could lose all or part of your investment in the notes.

                                        14
<PAGE>

 BECAUSE THE NOTES ARE SUBORDINATED TO OUR SENIOR DEBT AND EFFECTIVELY
 SUBORDINATED TO THE DEBT AND OTHER LIABILITIES OF OUR SUBSIDIARIES, YOU MAY NOT
 RECEIVE FULL PAYMENT ON YOUR NOTES

     The notes are junior in right of payment to all of our debt, other than any
future debt that expressly provides that it ranks equal with, or is subordinated
in right of payment to, the notes. As a result, upon any distribution to our
creditors in a bankruptcy, liquidation, reorganization or similar proceeding,
the holders of our senior debt will be entitled to be paid in full before any
payment will be made in on the notes.

     In addition, all payments on the notes may be blocked in the event of a
payment default until cured, or for up to 179 days in the event of certain
non-payment defaults under our senior secured credit facilities or any other
designated senior debt, including our 9 1/2 senior notes due 2009. Such payments
may only be blocked once within any period of 365 days.

     In the event of a bankruptcy, liquidation or reorganization or similar
proceeding relating to us, holders of the notes will participate in our assets
with trade creditors and all other holders of our debt. However, because the
indenture for the notes requires that amounts otherwise payable to holders of
the notes in a bankruptcy or similar proceeding be paid to holders of senior
debt instead, holders of the notes may receive less ratably than holders of
trade payables and holders of our other debt in any such proceeding. In any of
these cases, holder of the notes may not be paid in full.

     After giving effect to the issuance of the notes and the repayment of
indebtedness under our senior secured credit facilities with the net proceeds
from the notes, as of September 30, 2002, we would have had $440 million of
consolidated debt outstanding other than the notes, all of which were senior in
right of payment to the notes. The notes are also effectively subordinated in
right of payment to all debt and other liabilities, including trade payables and
other accrued liabilities, of all of our subsidiaries.

 SINCE THE NOTES ARE UNSECURED, THEY ARE ALSO EFFECTIVELY SUBORDINATED TO ANY OF
 OUR EXISTING AND FUTURE SECURED DEBT

     Our obligations under the notes are unsecured. In contrast, our obligations
under our senior secured credit agreement are secured by a significant portion
of our assets. As a result, the notes are effectively subordinated to our
obligations under our senior secured credit agreement as well as any other
secured debt. If we are in default on these secured obligations, you may not
receive principal and interest payment on your notes. After giving effect to the
issuance of the notes and the repayment of indebtedness under our senior secured
credit facilities with the net proceeds from the notes, as of September 30,
2002, we would have had $165 million of secured indebtedness outstanding, and
the ability to borrow $75 million more under our senior secured credit
agreement.

 DESPITE OUR SUBSTANTIAL INDEBTEDNESS, WE MAY STILL INCUR SIGNIFICANTLY MORE
 DEBT, WHICH COULD FURTHER INCREASE THE RISKS DESCRIBED ABOVE

     The terms of our senior secured credit agreement and the indentures related
to the notes and the 9 1/2% senior notes due 2009 do not prohibit us or our
subsidiaries from incurring additional indebtedness in the future. Any
additional debt could be senior to the notes and could increase the risks
described above.

 WE MAY NOT BE ABLE TO RAISE THE FUNDS NECESSARY TO FINANCE OUR OBLIGATION TO
 PURCHASE THE NOTES AT THE OPTION OF THE HOLDER AND YOUR REPURCHASE RIGHT MAY
 RESULT IN A DEFAULT UNDER OUR OTHER DEBT UNDER SOME CIRCUMSTANCES

     On December 15, 2009, and upon the occurrence of a fundamental change (as
defined), holders of the notes will have the right to require us to purchase all
or a portion of their notes for cash. See "Description of Notes -- Repurchase at
Option of the Holder" and "Description of Notes -- Repurchase at Option of the
Holder Upon a Fundamental Change." However, we may not have sufficient funds at
that time to make the required purchase of all the notes surrendered for
purchase and, if we don't, we may not be able to raise the necessary funds
either through the sale of assets, debt or equity financings or

                                        15
<PAGE>

otherwise. In addition, the agreements governing our other debt, including the
senior secured credit agreement, may prohibit us from making any such repurchase
and we cannot assure you that we would be able to obtain any consent or waiver
from our lenders.

     In addition, certain important corporate events, such as leveraged
recapitalizations that would increase the level of our indebtedness, may not
constitute a fundamental change under the indenture.

 THE VALUE OF THE CONVERSION RIGHT ASSOCIATED WITH THE NOTES MAY BE
 SUBSTANTIALLY LESSENED OR ELIMINATED IF WE ARE PARTY TO A MERGER, CONSOLIDATION
 OR OTHER SIMILAR TRANSACTION

     If we are party to a consolidation, merger or binding share exchange or
transfer or lease of all or substantially all of our assets pursuant to which
our common stock is converted into, or into the right to receive, cash,
securities or other property, at the effective time of the transaction, the
right to convert a note into our common stock will be changed into a right to
convert it into the kind and amount of cash, securities or other property which
the holder would have received if the holder had converted its note immediately
prior to the transaction. This change could substantially lessen or eliminate
the value of the conversion privilege associated with the notes in the future.
For example, if we were acquired in a cash merger, each note would become
convertible solely into cash and would no longer be convertible into securities
whose value would vary depending on our future prospects and other factors.

 WE EXPECT THAT THE TRADING VALUE OF THE NOTES WILL BE SIGNIFICANTLY AFFECTED BY
 THE PRICE OF OUR COMMON STOCK AND OTHER FACTORS AND OUR STOCK PRICE MAY BE
 VOLATILE AND COULD DECLINE SUBSTANTIALLY

     The market price of the notes is expected to be affected significantly by
the market price of our common stock. This may result in greater volatility in
the trading value of the notes than would be expected for nonconvertible debt
securities we issue. Our stock price may decline substantially as a result of
the volatile nature of the stock market and other factors beyond our control.
The stock market has, from time to time, experienced extreme price and volume
fluctuations. Many factors may cause the market price for our common stock to
decline following this offering, including:

     - our operating results failing to meet the expectations of securities
       analysts or investors in any quarter;

     - downward revisions in securities analysts' estimates;

     - material announcements by us or our competitors;

     - public sales of a substantial number of shares of our common stock
       following this offering;

     - governmental regulatory action; or

     - adverse changes in general market conditions or economic trends.

     In the past, companies that have experienced volatility in the market price
of their stock have been the subject of securities class action litigation. If
we become involved in securities class action litigation in the future, it could
result in substantial costs and diversion of management attention and resources,
thus harming our business.

 SHARES ELIGIBLE FOR PUBLIC SALE COULD ADVERSELY AFFECT OUR STOCK PRICE AND IN
 TURN THE MARKET PRICE OF THE NOTES

     The future sale of a substantial number of our shares of common stock in
the public market, or the perception that such sales could occur, could
significantly reduce our stock price which, in turn, could adversely affect the
market price of the notes. It could also make it more difficult for us to raise
funds through equity offerings in the future.

     As of March 3, 2003, we had 47,659,398 shares of common stock outstanding
including 14,000,371 restricted shares held by some of our stockholders. This
does not include the 6,762,874 shares of common stock that are issuable upon
conversion of the notes. The restricted shares may in the future be sold
                                        16
<PAGE>

without registration under the Securities Act of 1933 to the extent permitted by
Rule 144 under the Securities Act or any applicable exemption under the
Securities Act. In addition, stockholders holding 13,564,221 of these restricted
shares have the right to require us to file a registration statement under the
Securities Act to register their shares of common stock.

     In addition, we have filed registration statements under the Securities Act
to register shares of common stock reserved for issuance under our stock option
plans, thus permitting the resale of such shares by non-affiliates upon issuance
in the public market without restriction under the Securities Act. As of March
3, 2003, options to purchase 2,611,022 shares were outstanding under these stock
option plans.

 AN ACTIVE TRADING MARKET FOR THE NOTES MAY NOT DEVELOP

     The notes comprise a new issue of securities for which there is currently
no public market. We do not plan to list the notes on any securities exchange or
to include them in any automated quotation system. We cannot assure you that an
active trading market for the notes will develop or as to the liquidity or
sustainability of any such market, your ability to sell your notes or the price
at which you will be able to sell your notes. Future trading prices of the notes
will depend on many factors, including, among other things, prevailing interest
rates, our operating results, the price of our common stock and the market for
similar securities.

 YOU SHOULD CONSIDER THE UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF OWNING
 THE NOTES

     The notes are characterized as indebtedness for United States federal
income tax purposes. Accordingly, holders will be required to include, in their
income, interest with respect to the notes.

     The notes are characterized as contingent payment debt instruments for
United States federal income tax purposes, and are subject to United States
federal income tax rules applicable to contingent payment debt instruments.
Moreover, under the indenture, we agree, and by acceptance of a beneficial
interest in the notes each beneficial owner of the notes will be deemed to have
agreed, among other things, for United States federal income tax purposes, to
treat the notes as indebtedness that is subject to the regulations governing
contingent payment debt instruments, and the discussion below assumes that the
notes will be so treated. However, no assurance can be given that the Internal
Revenue Service will not assert that the notes should be treated differently.
Any such different treatment could affect the amount, timing and character of
income, gain or loss in respect of an investment in the notes. In general,
beneficial owners of the notes will be required to accrue ordinary interest
income, which we refer to as tax original issue discount, on the notes, in
advance of the receipt of the cash or other property attributable to the notes,
regardless of whether such owner uses the cash or accrual method of tax
accounting. Beneficial owners will be required, in general, to accrue tax
original issue discount based on the rate at which we would issue a
noncontingent, nonconvertible, fixed-rate debt instrument with terms and
conditions otherwise similar to those of the notes, rather than at a lower rate
based on the stated semi-annual cash interest payable on the notes. Accordingly,
owners of the notes will be required to include interest in taxable income in
each year in excess of the stated semi-annual cash interest payable on the
notes. Furthermore, upon a sale, exchange, purchase by us at the holder's
option, conversion, redemption or retirement of a note, owners of the notes will
recognize gain or loss equal to the difference between the amount realized and
their adjusted tax basis in the notes. In general, the amount realized will
include, in the case of a conversion, the fair market value of shares of our
common stock received. Any gain on a sale, exchange, purchase by us at the
holder's option, conversion, redemption or retirement of a note will be treated
as ordinary interest income; any loss will be ordinary loss to the extent of the
interest previously included in income, and thereafter, capital loss. Owners of
the notes should consult their tax advisors as to the United States federal,
state, local or other tax consequences of acquiring, owning and disposing of the
notes. A summary of the United States federal income tax consequences of
ownership of the notes is described in this prospectus under the heading
"Certain United States Federal Income Tax Considerations."

                                        17
<PAGE>

 YOU MAY ONLY CONVERT THE NOTES INTO SHARES OF OUR COMMON STOCK UNDER CERTAIN
 CIRCUMSTANCES, WHICH MAY NOT OCCUR

     The notes may only be converted into shares of our common stock if one or
more of the conditions described under "Description of Notes -- Conversion of
Notes" are satisfied. We cannot assure you that any notes you purchase will
become convertible into shares of our common stock prior to their stated
maturity. If you are unable to convert your notes prior to their stated
maturity, you may be unable to realize the value of the conversion rights
associated with your notes.

 CONVERSION OF THE NOTES WILL DILUTE THE OWNERSHIP INTERESTS OF EXISTING
 STOCKHOLDERS

     The conversion of some or all of the notes will dilute the ownership
interest of existing stockholders. Any sales in the public market of the common
stock issuable upon such conversion could adversely affect prevailing market
prices of our common stock. In addition, the existence of the notes may
encourage short selling by market participants because the conversion of the
notes could depress the price of our common stock.

               SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

     Throughout this prospectus, including documents we incorporate by
reference, we may make statements that express our opinions, expectations, or
projections regarding future events or future results, in contrast with
statements that reflect historical facts. These predictive statements, which we
generally precede or accompany by such typical conditional words as
"anticipate," "intend," "believe," "estimate," "plan," "seek," "project" or
"expect," or by the words "may," "will," or "should," are intended to operate as
"forward looking statements" of the kind permitted by the Private Securities
Litigation Reform Act of 1995, incorporated in Section 27A of the Securities Act
and Section 21E of the Securities Exchange Act of 1934, as amended. That
legislation protects such predictive statements by creating a "safe harbor" from
liability in the event that a particular prediction does not turn out as
anticipated.

     While we always intend to express our best judgment when we make statements
about what we believe will occur in the future, and although we base these
statements on assumptions that we believe to be reasonable when made, these
forward looking statements are not a guarantee of performance, and you should
not place undue reliance on such statements. Forward looking statements are
subject to many uncertainties and other variable circumstances, many of which
are outside of our control, that could cause our actual results and experience
to differ materially from those we thought would occur.

     The following listing represents some, but not necessarily all, of the
factors that may cause actual results to differ from those anticipated or
predicted:

     - cyclical changes in market supply and demand for steel; general economic
       conditions; U.S. or foreign trade policy affecting steel imports or
       exports; and governmental monetary or fiscal policy in the U.S. and other
       major international economies;

     - risks and uncertainties involving new products or new technologies, such
       as our Iron Dynamics ironmaking process, in which the product or process
       or certain critical elements thereof may not work at all, may not work as
       well as expected, or may turn out to be uneconomic even if they do work;

     - changes in the availability or cost of steel scrap, steel scrap
       substitute materials or other raw materials or supplies which we use in
       our production processes, as well as periodic fluctuations in the
       availability and cost of electricity, natural gas or other utilities;

     - the occurrence of unanticipated equipment failures and plant outages or
       incurrence of extraordinary operating expenses;

     - actions by our domestic and foreign competitors, including the addition
       or reduction of production capacity, or loss of business from one or more
       of our major customers or end-users;

                                        18
<PAGE>

     - labor unrest, work stoppages and/or strikes involving our own workforce,
       those of our important suppliers or customers, or those affecting the
       steel industry in general;

     - the effect of the elements upon our production or upon the production or
       needs of our important suppliers or customers;

     - the impact of, or changes in, environmental laws or in the application of
       other legal or regulatory requirements upon our production processes or
       costs of production or upon those of our suppliers or customers,
       including actions by government agencies, such as the U.S. Environmental
       Protection Agency or the Indiana Department of Environmental Management,
       on pending or future environmentally related construction or operating
       permits;

     - pending, anticipated or unanticipated private or governmental liability
       claims or litigation, or the impact of any adverse outcome of any
       currently pending or future litigation on the adequacy of our reserves,
       the availability or adequacy of our insurance coverage, our financial
       well-being or our business and assets;

     - changes in interest rates or other borrowing costs, or the effect of
       existing loan covenants or restrictions upon the cost or availability of
       credit to fund operations or take advantage of other business
       opportunities;

     - changes in our business strategies or development plans which we may
       adopt or which may be brought about in response to actions by our
       suppliers or customers, and any difficulty or inability to successfully
       consummate or implement as planned any of our projects, acquisitions,
       joint ventures or strategic alliances; and

     - the impact of governmental approvals, litigation, construction delays,
       cost overruns or technology risk upon our ability to complete, start-up
       or continue to profitably operate a project, or to operate it as
       anticipated.

     We also believe that you should read the many factors described in "Risk
Factors" to better understand the risks and uncertainties inherent in our
business and underlying any forward looking statements.

     Any forward looking statements which we make in this prospectus or in any
of the documents that are incorporated by reference herein speak only as of the
date of such statement, and we undertake no ongoing obligation to update such
statements. Comparisons of results between current and any prior periods are not
intended to express any future trends or indications of future performance,
unless expressed as such, and should only be viewed as historical data.

                                USE OF PROCEEDS

     The selling securityholders will receive all of the proceeds from the sale
of the notes and the common stock issuable upon conversion of the notes or
otherwise offered by this prospectus. We will not receive any proceeds.

                      RATIOS OF EARNINGS TO FIXED CHARGES

     Our ratios of earnings to fixed charges for each of the periods indicated
are as follows:

<Table>
<Caption>
                               NINE MONTHS
                                  ENDED
                              SEPTEMBER 30,         YEAR ENDED DECEMBER 31,
                              -------------   ------------------------------------
                                  2002        2001    2000   1999    1998    1997
                              -------------   -----   ----   -----   -----   -----
<S>                           <C>             <C>     <C>    <C>     <C>     <C>     <C>
Ratio of earnings to fixed
  charges...................      3.22x        .79x   2.78x  2.48x   3.10x   4.01x
</Table>

     For purposes of calculating our ratio of earnings to fixed charges,
earnings consist of earnings from continuing operations before income taxes, and
extraordinary items, adjusted for the portion of fixed charges deducted from
these earnings, plus amortization of capitalized interest. Fixed charges consist
of
                                        19
<PAGE>

interest on all indebtedness, including capitalized interest, and amortization
of debt issuance costs other than those classified as extraordinary. For the
year ended December 31, 2001, earnings were insufficient to cover fixed charges
by $7.3 million.

                              DESCRIPTION OF NOTES

     The notes were issued under an indenture dated as of December 23, 2002,
between Steel Dynamics, or SDI, as issuer, and Fifth Third Bank, as trustee. The
notes and the shares issuable upon conversion of the notes are covered by a
registration rights agreement, which we entered into with the initial purchaser
of the notes. The indenture and the registration rights agreement are exhibits
to the registration statement of which this prospectus is a part.

     The following description is a summary of the material provisions of the
notes, the indenture and the registration rights agreement. It does not purport
to be complete. This summary is subject to and is qualified by reference to all
the provisions of the indenture, including the definitions of certain terms used
in the indenture, and the registration rights agreement. Wherever particular
provisions or defined terms of the indenture or form of note are referred to,
these provisions or defined terms are incorporated in this prospectus by
reference. We urge you to read the indenture because it, and not this
description, defines your rights as a holder of notes.

     As used in this "Description of Notes" section, references to "Steel
Dynamics," "SDI," "we," "our" or "us" refer solely to Steel Dynamics, Inc. and
not to our subsidiaries.

GENERAL

     The notes are general unsecured obligations of Steel Dynamics. Our payment
obligations under the notes are subordinated to our senior indebtedness and
effectively subordinated to all indebtedness and other liabilities of our
subsidiaries. See "-- Subordination of Notes." The notes are convertible into
common stock as described under "Conversion of Notes."

     The notes are limited to $115 million aggregate principal amount. The notes
are issued only in denominations of $1,000 and multiples of $1,000. The notes
will mature on December 15, 2012 unless earlier converted, redeemed or
repurchased.

     Neither we nor any of our subsidiaries will be subject to any financial
covenants under the indenture. In addition, neither we nor any of our
subsidiaries are restricted under the indenture from paying dividends, incurring
debt, or issuing or repurchasing our securities.

     You are not afforded protection under the indenture in the event of a
highly leveraged transaction or a change in control of us except to the extent
described below under "Repurchase at Option of the Holder."

     Under the indenture governing the notes, we have agreed, and by acceptance
of a beneficial interest in the notes each beneficial owner of the notes will be
deemed to have agreed, among other things, for United States federal income tax
purposes, to treat the notes as indebtedness that is subject to the regulations
governing contingent payment debt instruments and, for purposes of those
regulations, to treat the fair market value of any stock received upon any
conversion of the notes as a contingent payment, and the discussion herein
assumes that such treatment is correct. However, the characterization of
instruments such as the notes and the application of such regulations is
uncertain in several respects. See "Certain United States Federal Income Tax
Considerations."

     We will pay interest, including contingent interest, if any, on June 15 and
December 15 of each year, beginning June 15, 2003, to record holders at the
close of business on the preceding June 1 and December 1, as the case may be,
except interest payable upon redemption or repurchase will be paid to the person
to whom principal is payable, unless the redemption or repurchase date is an
interest payment date.

                                        20
<PAGE>

     We will maintain an office in the Borough of Manhattan, The City of New
York, for the payment of interest, which shall initially be an office or agency
of the trustee. We may pay interest either:

     - by check mailed to your address as it appears in the note register,
       provided that if you are a holder with an aggregate principal amount in
       excess of $2.0 million, you shall be paid, at your written election, by
       wire transfer in immediately available funds; or

     - by transfer to an account maintained by you in the United States.

     However, payments to The Depository Trust Company, New York, New York,
which we refer to as DTC, will be made by wire transfer of immediately available
funds to the account of DTC or its nominee. Interest will be computed on the
basis of a 360-day year composed of twelve 30-day months.

     The notes are debt instruments that are subject to the contingent payment
debt regulations. Therefore, the notes were issued with original issue discount
for United States federal income tax purposes, which we refer to as tax original
issue discount. In general, beneficial owners of the notes will be required to
accrue interest income on the notes for United States federal income tax
purposes in the manner described herein, regardless of whether such owners use
the cash or accrual method of tax accounting. Beneficial owners will be
required, in general, to accrue interest each year, as tax original issue
discount, based on the rate at which we would issue a noncontingent,
nonconvertible, fixed-rate debt instrument with terms and conditions otherwise
similar to those of the notes, rather than at a lower rate based on the accrual
on the notes for non-tax purposes (i.e., in excess of the stated semi-annual
interest payments and any contingent interest payments) actually received in
that year. Accordingly, owners of notes will be required to include tax original
issue discount as interest in taxable income in each year in excess of the
accruals on the notes for non-tax purposes. Furthermore, upon a sale, exchange,
purchase by us at the holder's option, conversion, redemption or retirement of a
note, holders will recognize gain or loss equal to the difference between the
amount realized and their adjusted tax basis in the note. The amount realized
will include, in the case of a conversion, the fair market value of shares of
our common stock received. Any gain recognized on a sale, exchange, purchase by
us at the holder's option, conversion, redemption or retirement of a note will
be treated as ordinary interest income. Holders are expected to consult their
own tax advisors as to the United States federal, state, local or other tax
consequences of acquiring, owning and disposing of the notes.

RANKING

     The notes are junior in right of payment with all our existing and future
senior indebtedness. As of September 30, 2002, after giving effect to the
issuance of the notes and the repayment of indebtedness under our senior secured
credit facilities with the net proceeds from the notes, we would have had $440
million of consolidated indebtedness outstanding other than the notes, all of
which would have been senior to the notes. The notes are effectively
subordinated to all of the liabilities of our subsidiaries.

CONVERSION OF NOTES

     You may convert any of your notes, in whole or in part, into common stock
prior to the close of business on the final maturity date of the notes, subject
to prior redemption or repurchase of the notes, only under the following
circumstances:

     - upon satisfaction of a market price condition;

     - upon the occurrence of specified credit rating events with respect to the
       notes;

     - upon notice of redemption; or

     - upon specified corporate transactions.

     The number of shares of common stock you will receive upon conversion of
your notes will be determined by multiplying the number of $1,000 principal
amount notes you convert by the conversion rate on the date of conversion. If we
call notes for redemption, you may convert the notes only until the close

                                        21
<PAGE>

of business on the business day prior to the redemption date unless we fail to
pay the redemption price. If you have submitted your notes for repurchase upon a
fundamental change, you may convert your notes only if you withdraw your
repurchase election. Similarly, if you exercise your option to require us to
redeem your notes other than upon a fundamental change, those notes may be
converted only if you withdraw your election to exercise your option in
accordance with the terms of the indenture. You may convert your notes in part
so long as such part is $1,000 principal amount or an integral multiple of
$1,000. If any note is converted during the period after a record date for an
interest payment date to but excluding the corresponding interest payment date,
then unless that note has been called for redemption on a redemption date during
that period (in which case we will not be required to pay interest on that
interest payment date with respect to that note), the notes must be accompanied
by funds equal to the interest payable on that interest payment date on the
principal amount so converted; provided that no such payment need be made to the
extent any overdue interest, or overdue contingent interest, if any, exists at
the time of conversion with respect to such note. You will not receive any cash
payments representing accrued interest, including contingent interest, if any,
upon conversion unless you convert on an interest payment date and were the
record holder on the applicable record date.

     Our delivery to you of shares of common stock into which a note is
convertible, together with any cash payment in lieu of any fractional shares,
will satisfy our obligation to pay the principal amount of such note, the
accrued but unpaid cash interest, including contingent interest, if any, and
accrued tax original issue discount through the conversion date. Thus, the
accrued but unpaid interest, including contingent interest, if any, and accrued
tax original issue discount through the conversion date will be deemed to be
paid in full rather than cancelled, extinguished or forfeited. For a discussion
of the tax treatment to you of receiving our common stock upon conversion, see
"Certain United States Federal Income Tax Considerations."

 CONVERSION UPON SATISFACTION OF MARKET PRICE CONDITION

     You may surrender your note for conversion into our common stock prior to
close of business on the maturity date at any time after the closing sale price
of our common stock exceeds 120% of the conversion price for at least 20 trading
days in the 30 consecutive trading days ending on the last trading day of any
fiscal quarter commencing after December 31, 2002.

     The "closing sale price" of our common stock on any date means the closing
per share sale price (or if no closing sale price is reported, the average of
the bid and ask prices or, if more than one in either case, the average of the
average bid and the average ask prices) on such date as reported in composite
transactions for the principal United States securities exchange on which our
common stock is traded or, if our common stock is not listed on a United States
national or regional securities exchange, as reported by the Nasdaq System or by
the National Quotation Bureau Incorporated. The "conversion price" as of any day
will equal $1,000 divided by the number of shares of common stock issuable upon
conversion of $1,000 principal amount of notes.

 CONVERSION UPON CREDIT RATINGS EVENT

     After the earlier of (a) the date the notes are rated by both Standard &
Poor's and Moody's and (b) January 31, 2003, you may surrender your note for
conversion into our common stock prior to maturity during any period in which
the long-term credit rating assigned to the notes by Standard & Poor's or
Moody's (or any successors to these entities) is "CCC" or "Caa3", respectively,
or lower, or if either of these rating agencies no longer rates the notes, or if
either of these rating agencies suspend or withdraws the rating assigned to the
notes, or if the notes are not assigned a rating by both rating agencies.

 CONVERSION UPON NOTICE OF REDEMPTION

     If we call notes for redemption, you may convert the notes until the close
of business on the business day immediately preceding the redemption date, after
which time your right to convert will expire unless we default in the payment of
the redemption price.

                                        22
<PAGE>

 CONVERSION UPON SPECIFIED CORPORATE TRANSACTIONS

     If we elect to:

     - distribute to all holders of our common stock certain rights entitling
       them to purchase, for a period expiring within 45 days, our common stock
       at less than the current market price (measured by averaging the closing
       prices for the 10 preceding trading days); or

     - distribute to all holders of our common stock, assets, debt securities or
       certain rights to purchase our securities, which distribution has a per
       share value exceeding 10% of the closing sale price of our common stock
       on the day preceding the declaration date for such distribution;

we must notify you at least 20 days prior to the ex-dividend date for such
distribution. Once we have given such notice, you may surrender your notes for
conversion at any time until the earlier of close of business on the business
day prior to the ex-dividend date or any announcement by us that such
distribution will not take place. No adjustment to your ability to convert will
be made if you will otherwise participate in the distribution without
conversion.

     In addition, if we are a party to a consolidation, merger, a binding share
exchange or sale of all or substantially all of our assets, in each case
pursuant to which our common stock would be converted into cash, securities or
other property, you may surrender your notes for conversion at any time from and
after the date which is 15 days prior to the anticipated effective date of the
transaction until and including the date which is 15 days after the actual date
of such transaction. If we are a party to a consolidation, merger, binding share
exchange or sale of all or substantially all of our assets, in each case
pursuant to which our common stock is converted into cash, securities, or other
property, then at the effective time of the transaction, your right to convert a
note into our common stock will be changed into a right to convert it into the
kind and amount of cash, securities and other property which you would have
received if you had converted your notes immediately prior to the transaction.
If the transaction also constitutes a fundamental change, you can require us to
redeem all or a portion of your notes as described under "Repurchase At Option
of the Holder Upon a Fundamental Change."

 CONVERSION PROCEDURES

     The initial conversion rate for the notes is 58.8076 shares of common stock
per $1,000 principal amount of notes, subject to adjustment as described below.
We will not issue fractional shares of common stock upon conversion of notes.
Instead, we will pay cash equal to the closing price of the common stock on the
trading day prior to the conversion date. Except as described below, you will
not receive any accrued interest or dividends upon conversion.

     To convert your note into common stock you must do the following (or comply
with DTC procedures for doing so in respect of your beneficial interest in notes
evidenced by a global note held by DTC):

     - complete and manually sign the conversion notice on the back of the note
       or facsimile of the conversion notice and deliver this notice to the
       conversion agent;

     - surrender the note to the conversion agent;

     - if required, furnish appropriate endorsements and transfer documents;

     - if required, pay all transfer or similar taxes; and

     - if required, pay funds equal to interest payable on the next interest
       payment date.

The date you comply with these requirements is the conversion date under the
indenture.

                                        23
<PAGE>

     We will adjust the conversion rate if any of the following events occurs:

     - we issue common stock as a dividend or distribution on our common stock;

     - we issue to all holders of common stock certain rights or warrants to
       purchase our common stock at a price per share that is less than the
       current market price of our common stock, as defined in the indenture;

     - we subdivide or combine our common stock;

     - we distribute to all holders of our common stock, shares of our capital
       stock, evidences of indebtedness or assets, including securities but
       excluding:

     - rights or warrants specified above;

     - dividends or distributions specified above; and

     - cash distributions;

     - we distribute cash, excluding any dividend or distribution in connection
       with our liquidation, dissolution or winding up or any quarterly cash
       dividend on our common stock to the extent that the aggregate cash
       dividend per share of common stock in any quarter does not exceed the
       greater of:

      - the amount per share of common stock of the next preceding quarterly
        cash dividend on the common stock to the extent that the preceding
        quarterly dividend did not require an adjustment of the conversion rate
        pursuant to this clause, as adjusted to reflect subdivisions or
        combinations of the common stock; and

      - 2.5% of the average of the last reported sale price of the common stock
        during the ten trading days immediately prior to the declaration date of
        the dividend.

        If an adjustment is required to be made under this clause as a result of
        a distribution that is a quarterly dividend, the adjustment would be
        based upon the amount by which the distribution exceeds the amount of
        the quarterly cash dividend permitted to be excluded pursuant to this
        clause. If an adjustment is required to be made under this clause as a
        result of a distribution that is not a quarterly dividend, the
        adjustment would be based upon the full amount of the distribution;

     - we or one of our subsidiaries makes a payment in respect of a tender
       offer or exchange offer for our common stock to the extent that the cash
       and value of any other consideration included in the payment per share of
       common stock exceeds the current market price per share of common stock
       on the trading day next succeeding the last date on which tenders or
       exchanges may be made pursuant to such tender or exchange offer; and

     - someone other than us or one of our subsidiaries makes a payment in
       respect of a tender offer or exchange offer in which, as of the closing
       date of the offer, our board of directors is not recommending rejection
       of the offer. The adjustment referred to in this clause will only be made
       if:

      - the tender offer or exchange offer is for an amount that increases the
        offeror's ownership of common stock to more than 25% of the total shares
        of common stock outstanding; and

      - the cash and value of any other consideration included in the payment
        per share of common stock exceeds the current market price per share of
        common stock on the business day next succeeding the last date on which
        tenders or exchanges may be made pursuant to the tender or exchange
        offer.

     However, the adjustment referred to in this clause will generally not be
made if as of the closing of the offer, the offering documents disclose a plan
or an intention to cause us to engage in a consolidation or merger or a sale of
all or substantially all of our assets.

                                        24
<PAGE>

     To the extent that we have a rights plan in effect upon conversion of the
notes into common stock, you will receive, in addition to the common stock, the
rights under the rights plan whether or not the rights have separated from the
common stock at the time of conversion, subject to limited exceptions.

     In the event of:

     - any reclassification of our common stock;

     - a consolidation, merger or combination involving us; or

     - a sale or conveyance to another person or entity of all or substantially
       all of our property and assets;

in which holders of our common stock would be entitled to receive stock, other
securities, other property, assets or cash for their common stock, upon
conversion of your notes you will be entitled to receive the same type of
consideration which you would have been entitled to receive if you had converted
the notes into our common stock immediately prior to any of these events.

     You may in certain situations be deemed to have received a distribution
subject to United States federal income tax as a dividend in the event of any
taxable distribution to holders of common stock or in certain other situations
requiring a conversion rate adjustment. See "Certain United States Federal
Income Tax Considerations."

     We may, from time to time, increase the conversion rate for a period of at
least 20 days if our board of directors has made a determination that this
increase would be in our best interests. Any such determination by our board
will be conclusive. We would give holders at least 15 days' notice of any
increase in the conversion rate. In addition, we may increase the conversion
rate if our board of directors deems it advisable to avoid or diminish any
income tax to holders of common stock resulting from any stock or rights
distribution. See "Certain United States Federal Income Tax Considerations."

     We will not be required to make an adjustment in the conversion rate unless
the adjustment would require a change of at least 1% in the conversion rate.
However, we will carry forward any adjustments that are less than 1% of the
conversion rate. Except as described above in this section, we will not adjust
the conversion rate for any issuance of our common stock or convertible or
exchangeable securities or rights to purchase our common stock or convertible or
exchangeable securities.

CONTINGENT INTEREST

     Subject to the accrual and record date provisions described herein, we will
pay contingent interest to the holders of notes during any six-month period from
December 15 to June 14 and from June 15 to December 14, with the initial
six-month period commencing December 15, 2007, if the trading price of the
notes, as defined in the indenture, for each of the five trading days
immediately preceding the first day of the applicable six-month period equals
120% or more of the principal amount of the notes.

     During any period when contingent interest shall be payable, the contingent
interest payable per $1,000 principal amount of notes will be an amount equal to
0.25% of the average trading price per $1,000 principal amount of notes during
the five trading days immediately preceding the first day of the applicable
six-month interest period.

     We will notify the noteholders upon determination that they will be
entitled to receive contingent interest during a six-month interest period.

OPTIONAL REDEMPTION BY STEEL DYNAMICS

     Beginning December 18, 2007, we may redeem the notes in whole or in part at
the following prices expressed as a percentage of the principal amount:

<Table>
<Caption>
REDEMPTION PERIOD                                             PRICE(%)
-----------------                                             --------
<S>                                                           <C>
Beginning on December 18, 2007 and ending on December 14,
  2008......................................................  101.143%
Beginning on December 15, 2008 and ending on December 14,
  2009......................................................  100.571%
</Table>

                                        25
<PAGE>

and 100% if redeemed on or after December 15, 2009. In each case, we will pay
interest to, but excluding, the redemption date. If the redemption date is an
interest payment date, interest shall be paid to the record holder on the
relevant record date. We are required to give notice of redemption by mail to
holders not more than 60 but not less than 30 days prior to the redemption date.

     If less than all of the outstanding notes are to be redeemed, the trustee
will select the notes to be redeemed in principal amounts of $1,000 or multiples
of $1,000 by lot, pro rata or by another method the trustee considers fair and
appropriate. If a portion of your notes is selected for partial redemption and
you convert a portion of your notes, the converted portion will be deemed to be
of the portion selected for redemption.

     We may not redeem the notes if we have failed to pay any interest on the
notes and such failure to pay is continuing. We will notify the noteholders if
we redeem the notes.

REPURCHASE AT OPTION OF THE HOLDER

     You have the right to require us to repurchase the notes for cash on
December 15 of 2009. We will be required to repurchase any outstanding note for
which you deliver a written repurchase notice to the paying agent. This notice
must be delivered during the period beginning at any time from the opening of
business on the date that is 20 business days prior to the repurchase date until
the close of business on the repurchase date. If a repurchase notice is given
and withdrawn during that period, we will not be obligated to repurchase the
notes listed in the notice. Our repurchase obligation will be subject to certain
additional conditions.

     The repurchase price payable for a note will be equal to 100% of the
principal amount thereof plus accrued and unpaid interest, including contingent
interest, if any, to the repurchase date.

     Your right to require us to repurchase notes is exercisable by delivering a
written repurchase notice to the paying agent within 20 business days of the
repurchase date. The paying agent initially will be the trustee.

     The repurchase notice must state:

     (1) if certificated notes have been issued, the note certificate numbers
         (or, if your notes are not certificated, your repurchase notice must
         comply with appropriate DTC procedures);

     (2) the portion of the principal amount of notes to be repurchased, which
         must be in $1,000 multiples; and

     (3) that the notes are to be repurchased by us pursuant to the applicable
         provisions of the notes and the indenture.

     You may withdraw any written repurchase notice by delivering a written
notice of withdrawal to the paying agent prior to the close of business of the
repurchase date. The withdrawal notice must state:

     - the principal amount of the withdrawn notes;

     - if certificated notes have been issued, the certificate numbers of the
       withdrawn notes (or, if your notes are not certificated, your withdrawal
       notice must comply with appropriate DTC procedures); and

     - the principal amount, if any, which remains subject to the repurchase
       notice.

     We must give notice of an upcoming repurchase date to all note holders not
less than 20 business days prior to the repurchase date at their addresses shown
in the register of the registrar. We will also give notice to beneficial owners
as required by applicable law. This notice will state, among other things the
procedures that holders must follow to require us to repurchase their notes.

     Payment of the repurchase price for a note for which a repurchase notice
has been delivered and not withdrawn is conditioned upon book-entry transfer or
delivery of the note, together with necessary

                                        26
<PAGE>

endorsements, to the paying agent at its office in the Borough of Manhattan, The
City of New York, or any other office of the paying agent, at any time after
delivery of the repurchase notice. Payment of the repurchase price for the note
will be made promptly following the later of the repurchase date and the time of
book-entry transfer or delivery of the note. If the paying agent holds money
sufficient to pay the repurchase price of the note on the business day following
the repurchase date, then, on and after the date:

     - the note will cease to be outstanding;

     - interest will cease to accrue; and

     - all other rights of the holder will terminate.

     This will be the case whether or not book-entry transfer of the note has
been made or the note has been delivered to the paying agent, and all other
rights of the note holder will terminate, other than the right to receive the
repurchase price upon delivery of the note.

     Our ability to repurchase notes with cash may be limited by the terms of
our then-existing borrowing agreements. The indenture will prohibit us from
repurchasing notes for cash from note holders if any event of default under the
indenture has occurred and is continuing, except a default in the payment of the
repurchase price with respect to the notes.

     We will comply with the provisions of Rule 13e-4 and any other tender offer
rules under the Exchange Act that may be applicable at the time of the tender
offer. We will file a Schedule TO or any other schedule required in connection
with any offer by us to repurchase the notes.

REPURCHASE AT OPTION OF THE HOLDER UPON A FUNDAMENTAL CHANGE

     If a fundamental change of SDI occurs at any time prior to the maturity of
the notes, you may require us to repurchase your notes, in whole or in part, on
a repurchase date that is 30 days after the date of our notice of the
fundamental change. The notes will be repurchased in integral multiples of
$1,000 principal amount.

     We will repurchase the notes at a price equal to 100% of the principal
amount to be repurchased, plus accrued interest, including contingent interest,
if any, to, but excluding, the repurchase date. If the repurchase date is an
interest payment date, we will pay interest to the record holder on the relevant
record date.

     We will mail to all record holders a notice of a fundamental change within
10 days after it has occurred. We are also required to deliver to the trustee a
copy of the fundamental change notice. If you elect to have us repurchase your
notes, you must deliver to us or our designated agent, on or before the 30th day
after the date of our fundamental change notice, your repurchase notice and any
notes to be repurchased, duly endorsed for transfer. We will promptly pay the
repurchase price for notes surrendered for repurchase following the repurchase
date.

     A "fundamental change" is any transaction or event (whether by means of an
exchange offer, liquidation, tender offer, consolidation, merger, combination,
reclassification, recapitalization or otherwise) in connection with which all or
substantially all of our common stock is exchanged for, converted into, acquired
for or constitutes solely the right to receive, consideration which is not all
or substantially all common stock that:

     - is listed on, or immediately after the transaction or event will be
       listed on, a United States national securities exchange, or

     - is approved, or immediately after the transaction or event will be
       approved, for quotation on the Nasdaq National Market or any similar
       United States system of automated dissemination of quotations of
       securities prices.

     We will comply with any applicable provisions of Rule 13e-4 and any other
tender offer rules under the Exchange Act in the event of a fundamental change.

                                        27
<PAGE>

     These fundamental change repurchase rights could discourage a potential
acquirer. However, this fundamental change repurchase feature is not the result
of management's knowledge of any specific effort to obtain control of us by
means of a merger, tender offer or solicitation, or part of a plan by management
to adopt a series of anti-takeover provisions. The term "fundamental change" is
limited to specified transactions and may not include other events that might
adversely affect our financial condition or business operations. Our obligation
to offer to redeem the notes upon a fundamental change would not necessarily
afford you protection in the event of a highly leveraged transaction,
reorganization, merger or similar transaction involving us.

     We may be unable to repurchase the notes in the event of a fundamental
change. If a fundamental change were to occur, we may not have enough funds to
pay the repurchase price for all tendered notes. Any future credit agreements or
other agreements relating to our indebtedness may contain provisions prohibiting
repurchase of the notes under certain circumstances, or expressly prohibit our
repurchase of the notes upon a fundamental change or may provide that a
fundamental change constitutes an event of default under that agreement. If a
fundamental change occurs at a time when we are prohibited from purchasing or
redeeming notes, we could seek the consent of our lenders to repurchase the
notes or attempt to refinance this debt. If we do not obtain consent, we would
not be permitted to purchase or redeem the notes. Our failure to repurchase
tendered notes would constitute an event of default under the indenture, which
might constitute a default under the terms of our other indebtedness. In these
circumstances, or if a fundamental change would constitute an event of default
under our senior indebtedness, the subordination provisions of the indenture
would restrict payments to the holders of notes.

MERGER AND SALE OF ASSETS BY STEEL DYNAMICS

     The indenture provides that we may not consolidate with or merge with or
into any other person or convey, transfer or lease its properties and assets
substantially as an entirety to another person, unless among other items:

     - we are the surviving person, or the resulting, surviving or transferee
       person, if other than us is a corporation organized and existing under
       the laws of the United States, any state thereof or the District of
       Columbia;

     - the successor person assumes all of our obligations under the notes and
       the indenture; and

     - we or such successor person will not be in default under the indenture
       immediately after the transaction.

     When such a person assumes our obligations in such circumstances, subject
to certain exceptions, we shall be discharged from all obligations under the
notes and the indenture.

EVENTS OF DEFAULT; NOTICE AND WAIVER

     The following will be events of default under the indenture:

     - we fail to pay principal or premium, if any, when due upon redemption,
       repurchase or otherwise on the notes;

     - we fail to pay any interest and liquidated damages, if any, on the notes,
       when due and such failure continues for a period of 30 days;

     - default in the payment of principal when due or a default resulting in
       acceleration of our other indebtedness for borrowed money where the
       aggregate principal amount with respect to which the default or
       acceleration has occurred exceeds $10 million, and such acceleration has
       not been rescinded or annulled within a period of 30 days;

                                        28
<PAGE>

     - we fail to perform or observe any of the covenants in the indenture and
       such failure continues for 30 days after written notice of that failure
       is given to us from the transfer (or to us and the trustee from the
       holders of at least 25% in principal amount of the outstanding notes); or

     - certain events involving our bankruptcy, insolvency or reorganization.

     The trustee may withhold notice to the holders of the notes of any default,
except defaults in payment of principal, premium, interest or liquidated
damages, if any, on the notes. However, the trustee must consider it to be in
the interest of the holders of the notes to withhold this notice.

     If an event of default occurs and continues, the trustee or the holders of
at least 25% in principal amount of the outstanding notes may declare the
principal, premium, if any, and accrued interest and liquidated damages, if any,
on the outstanding notes to be immediately due and payable. In case of certain
events of bankruptcy or insolvency involving us, the principal, premium, if any,
and accrued interest and liquidated damages, if any, on the notes will
automatically become due and payable. However, if we cure all defaults, except
the nonpayment of principal, premium, if any, interest or liquidated damages, if
any, that became due as a result of the acceleration, and meet certain other
conditions, with certain exceptions, this declaration may be cancelled and the
holders of a majority of the principal amount of outstanding notes may waive
these past defaults.

     Payments of principal, premium, if any, or interest on the notes that are
not made when due will accrue interest at the annual rate of 1% above the then
applicable interest rate from the required payment date.

     The holders of a majority of outstanding notes will have the right to
direct the time, method and place of any proceedings for any remedy available to
the trustee, subject to limitations specified in the indenture.

     No holder of the notes may pursue any remedy under the indenture, except in
the case of a default in the payment of principal, premium, if any, or interest
on the notes, unless:

     - the holder has given the trustee written notice of an event of default;

     - the holders of at least 25% in principal amount of outstanding notes make
       a written request, and offer reasonable indemnity, to the trustee to
       pursue the remedy;

     - the trustee does not receive an inconsistent direction from the holders
       of a majority in principal amount of the notes; and

     - the trustee fails to comply with the request within 60 days after
       receipt.

MODIFICATION AND WAIVER

     The consent of the holders of a majority in principal amount of the
outstanding notes is required to modify or amend the indenture. However, a
modification or amendment requires the consent of the holder of each outstanding
note if it would:

     - extend the fixed maturity of any note;

     - reduce the rate or extend the time for payment of interest of any note;

     - reduce the principal amount or premium of any note;

     - reduce any amount payable upon redemption or repurchase of any note;

     - adversely change our obligation to redeem any note upon a fundamental
       change;

     - impair the right of a holder to institute suit for payment on any note;

     - change the currency in which any note is payable;

     - impair the right of a holder to convert any note;

                                        29
<PAGE>

     - adversely modify, in any material respect, the subordination provisions
       of the indenture;

     - reduce the quorum or voting requirements under the indenture;

     - change any obligation of ours to maintain an office or agency in the
       places and for the purposes specified in the indenture;

     - subject to specified exceptions, modify certain of the provisions of the
       indenture relating to modification or waiver of provisions of the
       indenture; or

     - reduce the percentage of notes required for consent to any modification
       of the indenture.

     We are permitted to modify certain provisions of the indenture without the
consent of the holders of the notes.

SUBORDINATION OF NOTES

     Payment on the notes will, to the extent provided in the indenture, be
subordinated in right of payment to the prior payment in full of all of our
existing and future senior indebtedness.

     Upon any distribution of our assets upon any dissolution, winding up,
liquidation or reorganization, the payment of the principal of, or premium, if
any, interest, and liquidated damages, if any, on the notes will be subordinated
in right of payment to the prior payment in full in cash or other payment
satisfactory to the holders of senior indebtedness of all senior indebtedness.
In the event of any acceleration of the notes because of an event of default,
the holders of any outstanding senior indebtedness would be entitled to payment
in full in cash or other payment satisfactory to the holders of senior
indebtedness of all senior indebtedness obligations before the holders of the
notes are entitled to receive any payment or distribution. We are required under
the indenture to promptly notify holders of senior indebtedness, if payment of
the notes is accelerated because of an event of default.

     We may not make any payment on the notes if:

     - a default in the payment of designated senior indebtedness occurs and is
       continuing beyond any applicable period of grace (called a "payment
       default"); or

     - a default other than a payment default on any designated senior
       indebtedness occurs and is continuing that permits holders of designated
       senior indebtedness to accelerate its maturity, or in the case of a
       lease, a default occurs and is continuing that permits the lessor to
       either terminate the lease or require us to make an irrevocable offer to
       terminate the lease following an event of default under the lease, and
       the trustee receives a notice of such default (called "payment blockage
       notice") from us or any other person permitted to give such notice under
       the indenture (called a "non-payment default").

     We may resume payments and distributions on the notes:

     - in case of a payment default, upon the date on which such default is
       cured or waived or ceases to exist; and

     - in case of a non-payment default, the earlier of the date on which such
       nonpayment default is cured or waived or ceases to exist or 179 days
       after the date on which the payment blockage notice is received, if the
       maturity of the designated senior indebtedness has not been accelerated,
       or in the case of any lease, 179 days after notice is received if we have
       not received notice that the lessor under such lease has exercised its
       right to terminate the lease or require us to make an irrevocable offer
       to terminate the lease following the event of default under the lease.

     No new period of payment blockage may be commenced pursuant to a payment
blockage notice unless 365 days have elapsed since the initial effectiveness of
the immediately prior payment blockage notice. No non-payment default that
existed or was continuing on the date of delivery of any payment blockage notice
shall be the basis for any later payment blockage notice.

                                        30
<PAGE>

     If the trustee or any holder of the notes receives any payment or
distribution of our assets in contravention of the subordination provisions on
the notes before all senior indebtedness is paid in full in cash or other
payment satisfactory to holders of senior indebtedness, then such payment or
distribution will be held in trust for the benefit of holders of senior
indebtedness or their representatives to the extent necessary to make payment in
full in cash or payment satisfactory to the holders of senior indebtedness of
all unpaid senior indebtedness.

     Because of the subordination provisions discussed above, in the event of
our bankruptcy, dissolution or reorganization, holders of senior indebtedness
may receive more, ratably, and holders of the notes may receive less, ratably,
than our other creditors. This subordination will not prevent the occurrence of
any event of default under the indenture.

     The term "senior indebtedness" is defined in the indenture and includes
principal, premium, interest, rent, fees, costs, expenses and other amounts
accrued or due on our existing or future indebtedness, as defined below, or any
existing or future indebtedness guaranteed or in effect guaranteed by us,
subject to certain exceptions. The term does not include:

     - any indebtedness that expressly provides that it is pari passu or junior
       to the notes; or

     - any indebtedness we owe to any of our subsidiaries; or

     - the notes.

     The term "indebtedness" is also defined in the indenture and includes, in
general terms, our liabilities in respect of borrowed money, notes, bonds,
debentures, letters of credit, bank guarantees, bankers' acceptances, capital
and certain other leases, interest rate and foreign currency derivative
contracts or similar arrangements, guarantees and certain other obligations
described in the indenture, subject to certain exceptions. The term does not
include, for example, any account payable or other accrued current liability or
obligation incurred in the ordinary course of business in connection with the
obtaining of materials or services.

     The term "designated senior indebtedness" is defined in the indenture and
includes our indebtedness under our senior secured credit facilities and our
9 1/2 senior notes due 2009 as well as, in general terms, any senior
indebtedness that by its terms expressly provides that it is "designated senior
indebtedness" for purposes of the indenture.

     After giving effect to the issuance of the notes and the repayment of
indebtedness under our senior secured credit facilities with the proceeds from
the notes, as of September 30, 2002, we would have had $440 million of
consolidated debt outstanding other than the notes, all of which was senior in
right of payment to the notes. The indentures for the notes and the 9 1/2%
senior notes due 2009 and the senior secured credit agreement do not prohibit us
or our subsidiaries from incurring additional indebtedness. The notes are also
effectively subordinated in right of payment to all debt and other liabilities,
including trade payables and other accrued liabilities, of all of our
subsidiaries.

     We are obligated to pay reasonable compensation to the trustee and to
indemnify the trustee against certain losses, liabilities or expenses incurred
by the trustee in connection with its duties relating to the notes. The
trustee's claims for these payments will generally be senior to those of the
holders of the notes in respect of all funds collected or held by the trustee.

FORM, DENOMINATION AND REGISTRATION

     The notes are issued:

     - in fully registered form;

     - without interest coupons; and

     - in denominations of $1,000 principal amount and integral multiples of
       $1,000.

                                        31
<PAGE>

  GLOBAL NOTE, BOOK-ENTRY FORM

     The notes are evidenced by one or more global notes. We have deposited the
global note or notes with DTC and have registered the global notes in the name
of Cede & Co. as DTC's nominee. Except as set forth below, a global note may be
transferred, in whole or in part, only to another nominee of DTC or to a
successor of DTC or its nominee.

     Beneficial interests in a global note may be held through organizations
that are participants in DTC (called "participants") or indirectly through
organizations that are participants. Transfers between participants will be
effected in the ordinary way in accordance with DTC rules and will be settled in
clearing house funds. The laws of some states require that certain persons take
physical delivery of securities in definitive form. As a result, the ability to
transfer beneficial interests in the global note to such persons may be limited.

     Beneficial interests in a global note held by DTC can only be held through
participants, or certain banks, brokers, dealers, trust companies and other
parties that clear through or maintain a custodial relationship with a
participant, either directly or indirectly (called "indirect participants"). So
long as Cede & Co., as the nominee of DTC, is the registered owner of a global
note, Cede & Co. for all purposes will be considered the sole holder of such
global note. Except as provided below, owners of beneficial interests in a
global note will:

     - not be entitled to have certificates registered in their names;

     - not receive physical delivery of certificates in definitive registered
       form; and

     - not be considered holders of the global note.

     We will pay interest including contingent interest, if any, on and the
redemption or repurchase price of a global note to Cede & Co., as the registered
owner of the global note, by wire transfer of immediately available funds on
each interest payment date or the redemption or repurchase date, as the case may
be. Neither we, the trustee nor any paying agent will be responsible or liable:

     - for the records relating to, or payments made on account of, beneficial
       ownership interests in a global note; or

     - for maintaining, supervising or reviewing any records relating to the
       beneficial ownership interests.

     We have been informed that DTC's practice is to credit participants'
accounts on that payment date with payments in amounts proportionate to their
respective beneficial interests in the principal amount represented by a global
note as shown in the records of DTC, unless DTC has reason to believe that it
will not receive payment on that payment date. Payments by participants to
owners of beneficial interests in the principal amount represented by a global
note held through participants will be the responsibility of the participants,
as is now the case with securities held for the accounts of customers registered
in "street name."

     Because DTC can only act on behalf of participants, who in turn act on
behalf of indirect participants, the ability of a person having a beneficial
interest in the principal amount represented by the global note to pledge such
interest to persons or entities that do not participate in the DTC system, or
otherwise take actions in respect of such interest, may be affected by the lack
of a physical certificate evidencing its interest.

     Neither we, the trustee, registrar, paying agent nor conversion agent will
have any responsibility for the performance by DTC or its participants or
indirect participants of their respective obligations under the rules and
procedures governing their operations. DTC has advised us that it will take any
action permitted to be taken by a holder of notes, including the presentation of
notes for exchange, only at the direction of one or more participants to whose
account with DTC interests in the global note are credited, and only in respect
of the principal amount of the notes represented by the global note as to which
the participant or participants has or have given such direction.

                                        32
<PAGE>

     DTC has advised us that it is:

     - a limited purpose trust company organized under the laws of the State of
       New York, and a member of the Federal Reserve System;

     - a "clearing corporation" within the meaning of the Uniform Commercial
       Code; and

     - a "clearing agency" registered pursuant to the provisions of Section 17A
       of the Exchange Act.

     DTC was created to hold securities for its participants and to facilitate
the clearance and settlement of securities transactions between participants
through electronic book-entry changes to the accounts of its participants.
Participants include securities brokers, dealers, banks, trust companies and
clearing corporations and other organizations. Some of the participants or their
representatives, together with other entities, own DTC. Indirect access to the
DTC system is available to others such as banks, brokers, dealers and trust
companies that clear through or maintain a custodial relationship with a
participant, either directly or indirectly.

     DTC has agreed to the foregoing procedures to facilitate transfers of
interests in a global note among participants. However, DTC is under no
obligation to perform or continue to perform these procedures, and may
discontinue these procedures at any time. If DTC is at any time unwilling or
unable to continue as depositary and a successor depositary is not appointed by
us within 90 days, we will issue notes in certificated form in exchange for
global notes.

REGISTRATION RIGHTS OF THE NOTEHOLDERS

     On December 23, 2002, we entered into a registration rights agreement with
the initial purchasers that required us, among other things, to file within 90
days, and to use our reasonable best efforts to cause to become effective within
180 days after that date, a shelf registration statement with the SEC covering
the resale of the notes and the common stock issuable upon conversion of the
notes. We have timely filed with the SEC a registration statement, of which this
prospectus is a part, to satisfy the filing obligation under the registration
rights agreement.

     A holder who sells notes or common stock pursuant to the registration
statement generally will be required to be named as a selling securityholder in
this prospectus or in a related prospectus supplement and to deliver a
prospectus to the subsequent purchasers, and will be bound by the provisions of
the registration rights agreement which are applicable to that holder (including
certain indemnification provisions). We are required to use our reasonable best
efforts to keep the shelf registration statement effective until the earlier of:

     - the sale pursuant to the shelf registration statement of all of the notes
       and the common stock issuable upon conversion of the notes registered
       thereunder; or

     - the expiration of the holding period under Rule 144(k) under the
       Securities Act, or any successor provision.

     We may suspend the use of the prospectus under certain circumstances
relating to pending corporate developments, public filings with the SEC and
similar events. Any suspension period shall not:

     - exceed 30 days in any three-month period; or

     - an aggregate of 90 days for all periods in any 12-month period.

     Notwithstanding the foregoing, we will be permitted to suspend the use of
the prospectus for up to 60 days in any 3-month period under certain
circumstances, relating to possible acquisitions, financings or other similar
transactions.

                                        33
<PAGE>

     We will pay predetermined liquidated damages if the shelf registration
statement is not timely filed or made effective or if the prospectus is
unavailable for periods in excess of those permitted above:

     - on the notes at an annual rate equal to 0.5% of the aggregate principal
       amount of the notes outstanding until the registration statement is filed
       or made effective or during the additional period the prospectus is
       unavailable; and

     - on the common stock that has been converted, at an annual rate equal to
       0.5% of an amount equal to $1,000 divided by the conversion rate during
       such periods.

INFORMATION CONCERNING THE TRUSTEE

     We have appointed Fifth Third Bank, the trustee under the indenture, as
paying agent, conversion agent, note registrar and custodian for the notes. The
trustee or its affiliates may provide banking and other services to us in the
ordinary course of their business.

     The indenture contains certain limitations on the rights of the trustee, if
it or any of its affiliates is then our creditor, to obtain payment of claims in
certain cases or to realize on certain property received on any claim as
security or otherwise. The trustee and its affiliates will be permitted to
engage in other transactions with us. However, if the trustee or any affiliate
continues to have any conflicting interest and a default occurs with respect to
the notes, the trustee must eliminate such conflict or resign.

     Fifth Third Bank is also the trustee under the indenture for the 9 1/2%
senior notes due 2009.

                                        34
<PAGE>

                          DESCRIPTION OF CAPITAL STOCK

     The following summary of certain provisions of the common stock does not
purport to be complete and is subject to, and qualified in its entirety by, the
provisions of our Articles of Incorporation and Bylaws, as well as by the
provisions of Indiana's law.

     Our authorized capital stock consists of 100,000,000 shares of common
stock, par value $.01 per share. As of March 3, 2003, there were 50,058,566
shares of common stock issued and 47,659,398 shares outstanding that were
beneficially owned by approximately 7,400 stockholders. As of March 3, 2003,
2,611,022 shares of common stock were reserved for issuance upon exercise of
outstanding stock options. In addition, 6,762,874 shares of common stock are
issuable upon conversion of the notes, subject to adjustment.

COMMON STOCK

     The holders of common stock are entitled to one vote for each share held of
record on all matters submitted to a vote of stockholders, including the
election of directors. The Articles do not provide for cumulative voting in the
election of directors and, thus, holders of a majority of the shares of common
stock may elect all of the directors standing for election.

     All holders of common stock are entitled to receive ratably such dividends,
if any, as may be declared from time to time by our board of directors in its
discretion from funds legally available therefor. Upon the liquidation,
dissolution or winding-up of our company, the holders of common stock are
entitled to receive ratably the net assets of our company that are available
after the payment of all debts and liabilities. Holders of common stock have no
preemptive rights or rights to convert their common stock into any other
securities, nor are there any redemption or sinking fund provisions applicable
to the common stock.

     All outstanding shares of common stock are, and the shares to be issued in
the offering will be, validly issued, fully paid, and non-assessable.

CERTAIN PROVISIONS OF INDIANA LAW REGARDING TAKEOVERS

     As an Indiana corporation, we are subject to certain provisions of Indiana
law which may discourage or render more difficult an unsolicited takeover of our
company. There are two principal statutes relating to this issue that constitute
part of the Indiana corporate law, the statute regulating "business
combinations" and the statute regulating "control share acquisitions."

     Under Chapter 43 of the Indiana corporate law relating to "business
combinations" a corporation (with 100 or more stockholders) may not engage in
any "business combination" with any "interested" stockholder for a period of
five years following the interested stockholder's "share acquisition date"
unless the business combination or the purchase of shares made by the interested
stockholder was approved by the corporation's board of directors prior to the
interested stockholder's share acquisition date. The term "business combination"
is broadly defined to apply to any merger or consolidation of the corporation
and the interested stockholder, as well as any sale, lease, exchange, mortgage,
pledge, transfer, or other disposition (in a single or a series of transactions)
to or with the interested stockholder (or any affiliate or associate thereof) of
any assets of the corporation if the transaction represents 10% or more of the
corporation's assets, outstanding shares of stock, or consolidated net income of
the corporation. Similarly, the issuance or transfer by the corporation of any
of its (or its subsidiary's) stock that has an aggregate market value equal to
5% or more of all the outstanding shares of stock to the interested stockholder
(or any affiliate or associate thereof) is a "business combination," except if
it is in connection with the distribution of a dividend or the exercise of
warrants paid or made pro rata to all stockholders. The term is applicable as
well as to the adoption of any plan of liquidation or dissolution proposed by or
under any understanding with an interested stockholder (or an affiliate or
associate thereof), and to any reclassification of securities, recapitalization,
merger or consolidation with any subsidiary, or any other transaction proposed
by or under any arrangement with the interested stockholder or any affiliate or

                                        35
<PAGE>

associate thereof) that has the "effect" of increasing the proportionate
interest of the interested stockholder in the corporation.

     An "interested stockholder," as defined, is any person (other than the
corporation or a subsidiary) that is the beneficial owner of 10% or more of the
voting power, or an affiliate or associate of the corporation that at any time
within the five prior years was the beneficial owner of 10% or more of the
voting power. For purposes of the statute, the "share acquisition date" is the
date upon which the person first becomes an interested stockholder of a
corporation. So long as the board of directors does not approve of the business
combination with the interested stockholder, the five-year "blackout" period, in
which the business combination is prohibited, applies, and the board of
directors is required to render its decision within a 30-day period (or sooner
if required by the Securities Exchange Act of 1934).

     In addition to the absolute five-year business combination prohibition, the
statute also requires that any business combination between the corporation and
an interested stockholder must satisfy additional statutory conditions. The
board of directors must have approved of the business combination before the
interested stockholder's share acquisition date or a majority of the outstanding
voting stock not beneficially owned by the interested stockholder must have
approved the business combination at a meeting held no earlier than five years
after the interested stockholder's share acquisition date, or the business
combination transaction must meet certain per share values to all stockholders
(keyed to the highest per share price paid by the interested stockholder within
the prior five-year period). All consideration must also be paid either in cash
or in the same form as the interested stockholder has used to acquire the
largest number of shares acquired by it. Furthermore, the statute requires an
interested stockholder to purchase all remaining shares of stock, if any are
purchased, not just one class or series.

     Under Chapter 42 of the Indiana corporate law the "control share
acquisition" statute, "control shares" (shares that, in the election of
directors, could exercise or direct the exercise of voting power of one-fifth,
one-third or a majority or more of all of the voting power) of any "issuing
public corporation" (one hundred or more stockholders, principal office or place
of business, or substantial assets within Indiana, or 10% of its stockholders
resident in Indiana) that are acquired in a "control share acquisition" by an
"acquiring person" will be accorded only such voting rights, after the
acquisition, as are specifically conferred by the stockholders, voting as a
group, excluding all "interested shares." If a person holding "interested
shares" engages in a control share acquisition of control shares, and the
stockholders have not acted to specifically grant those acquired shares the
voting rights they had prior to the control share acquisition, the acquired
shares lose their voting rights. A majority of the shares (excluding interested
shares) must be voted to confer voting rights upon the acquiring person. The
only exemption from this statute is if the corporation's articles of
incorporation or its bylaws provide that this statute does not apply to control
share acquisitions of the corporation's shares, and such provisions must exist
prior to the occurrence of any "control share acquisition." However, the Company
does not have such a provision in either its Articles or in its Bylaws.
Furthermore, if the Articles or Bylaws so provide (and the Articles and Bylaws
do not so provide at this time), control shares acquired in a control share
acquisition with respect to which the shares have not been accorded full voting
rights by the stockholders can be redeemed by the corporation at "fair value."
But if in fact the stockholders of the corporation do vote to accord full voting
rights to the acquiring person's control shares, and if the acquiring person has
acquired control with a majority or more of the voting power, all stockholders
of the issuing public corporation are allowed to invoke dissenters' rights,
providing "fair value" to them (defined as not less than the highest price paid
per share by the acquiring person in the control share acquisition). In order to
secure stockholder approval, as required, the acquiring person must deliver an
acquiring person "statement" to the corporation, setting forth pertinent
information concerning the identity of the acquiring person, the number of
shares already owned, the range of voting power that the control share
acquisition seeks, and the terms of the proposed acquisition. Thereafter, the
directors for the issuing public corporation, within ten days, are required to
call a special meeting of the stockholders to consider the voting rights issue,
and the stockholders meeting must be held within 50 days after receipt of the
statement by the issuing public corporation. The acquiring person can
specifically request that the special stockholders meeting not be held sooner
than thirty days after delivery of the acquiring person's statement to the
issuing public corporation. The corporation's notice

                                        36
<PAGE>

of the special stockholders meeting must be accompanied by the acquiring
person's statement, as well as a statement by the Board of Directors of the
corporation, concerning its position or recommendation (or that it is taking no
position or making no recommendation) with respect to the voting rights issue in
the proposed control share acquisition.

TRANSFER AGENT AND REGISTRAR

     The transfer agent and registrar for our common stock is EquiServe Trust
Company, N.A.

                          PRICE RANGE OF COMMON STOCK

     Our common stock is quoted on the Nasdaq National Market under the symbol
"STLD." The following table presents, for the periods indicated, the high and
low sale prices for our common stock as reported on the Nasdaq National Market.

<Table>
<Caption>
                                                               HIGH       LOW
                                                              -------   -------
<S>                                                           <C>       <C>
YEAR ENDED DECEMBER 31, 2000:
  First Quarter.............................................  $19.000   $11.125
  Second Quarter............................................   12.938     8.250
  Third Quarter.............................................   12.750     8.813
  Fourth Quarter............................................   12.000     8.438
YEAR ENDED DECEMBER 31, 2001:
  First Quarter.............................................  $13.250   $10.000
  Second Quarter............................................   14.950    10.688
  Third Quarter.............................................   14.950     8.930
  Fourth Quarter............................................   12.040     9.000
YEAR ENDED DECEMBER 31, 2002:
  First Quarter.............................................  $16.890   $11.400
  Second Quarter............................................   19.300    15.250
  Third Quarter.............................................   18.400    10.610
  Fourth Quarter............................................   14.690    11.800
</Table>

     The last sale price for our common stock as reported on the Nasdaq National
Market at the close of business on March 3, 2003 was $12.34. As of December 31,
2002, there were approximately 660 holders of record and approximately 7,400
beneficial owners of our common stock.

                                DIVIDEND POLICY

     We have never declared or paid cash dividends. We currently anticipate that
all of our future earnings will be retained to finance the expansion of our
business and do not anticipate paying cash dividends in the foreseeable future.
Any determination to pay cash dividends in the future will be at the discretion
of our board of directors after taking into account various factors, including
our financial condition, results of operations, outstanding indebtedness,
current and anticipated cash needs and plans for expansion. In addition, the
terms of our senior secured credit agreement and the indenture relating to our
9 1/2% senior notes restrict our ability to pay cash dividends.

                            SELLING SECURITYHOLDERS

     We initially issued the notes to the initial purchasers of the notes who
then resold the notes in transactions exempt from the registration requirements
of the Securities Act to persons reasonably believed by the initial purchasers
to be "qualified institutional buyers," as defined by Rule 144A under the
Securities Act. Selling securityholders, including their transferees, pledgees,
donees and successors, may

                                        37
<PAGE>

from time to time offer and sell pursuant to this prospectus any and all of the
notes and shares of common stock into which the notes are convertible.

     No offer or sale under this prospectus may be made by a selling
securityholder unless that holder is listed in the table in this prospectus or
until that holder has notified us and a supplement to this prospectus has been
filed or an amendment to the registration statement of which this prospectus is
a part has become effective. We will supplement or amend this prospectus to
include additional selling securityholders upon request and upon provision of
all required information to us. Information concerning the selling
securityholders may change from time to time, and any changed information will
be set forth in supplements to this prospectus if and when necessary.

     The table below sets forth the name of each selling securityholder and the
principal amount of notes and shares of common stock beneficially owned by each
selling securityholder that may be offered pursuant to this prospectus. Unless
set forth below, to our knowledge, none of the selling securityholders has, or
within the past three years has had, any material relationship with us or any of
our predecessors or affiliates.

     We have prepared the table below based on information given to us by the
selling securityholders on or prior to March 3, 2003. The selling
securityholders may offer any or all of the notes and shares of common stock
into which the notes are convertible, or the other shares of common stock listed
below. Accordingly, we cannot estimate the amounts of notes or shares of common
stock that will be held by the selling securityholders upon consummation of any
such sales. In addition, the selling securityholders listed in the table below
may have acquired, sold or transferred, in transactions exempt from the
registration requirements of the Securities Act, some or all of their notes
since the date on which they provided to us the information presented in the
table.

     The percentage of notes outstanding beneficially owned by each selling
securityholder is based on $115,000,000 aggregate principal amount of notes
outstanding. The number of shares of common stock beneficially owned prior to
the offering includes shares of common stock into which the notes may be
convertible. The number of shares of common stock that may be offered by holders
of notes is based on a conversion rate of 58.8076 shares per $1,000 principal
amount of notes and a cash payment in lieu of any fractional share. The
percentage of common stock outstanding beneficially owned and that may be
offered by each selling securityholder, assuming full conversion of all notes at
the foregoing conversion rate, is based on 57,033,294 shares of common stock
deemed to be outstanding on March 3, 2003.

     The conversion rate and, therefore, the number of shares of common stock
issuable upon conversion of the notes is subject to adjustment under certain
circumstances. Accordingly, the aggregate principal amount of notes and the
number of shares of common stock into which the notes are convertible may
increase or decrease.

                                        38
<PAGE>

                   4% CONVERTIBLE SUBORDINATED NOTES DUE 2012
                            SELLING SECURITYHOLDERS

<Table>
<Caption>
                                  PRINCIPAL
                                    AMOUNT                        COMMON                      PERCENTAGE
                                   OF NOTES     PERCENTAGE        STOCK        COMMON STOCK    OF COMMON
                                   THAT MAY      OF NOTES     OWNED PRIOR TO   THAT MAY BE       STOCK
NAME                              BE OFFERED    OUTSTANDING    THE OFFERING      OFFERED      OUTSTANDING
----                             ------------   -----------   --------------   ------------   -----------
<S>                              <C>            <C>           <C>              <C>            <C>
AIG DKR SoundShore Opportunity
  Holding Fund Ltd. ...........  $  4,000,000       3.5%          235,230         235,230           *
Akela Capital Master Fund,
  Ltd. ........................  $  8,000,000         7%          470,460         470,460           *
Argent Classic Convertible
  Arbitrage Fund (Bermuda)
  Ltd. ........................  $  1,600,000       1.4%           94,092          94,092           *
Argent Classic Convertible
  Arbitrage Fund L.P. .........  $    900,000         *            52,926          52,926           *
#Bear, Stearns & Co. Inc. .....  $  1,250,000       1.1%           73,509          73,509           *
+BNP Paribas Equity Strategies,
  SNC(2).......................  $  2,965,000       2.6%          174,364         174,364           *
CooperNeff Convertible
  Strategies (Cayman) Master
  Fund, LP.....................  $  1,650,000       1.4%           97,032          97,032           *
Grace Brothers Management LLC..  $  2,000,000       1.7%          117,615         117,615           *
+KBC Alpha Master Fund A/C.....
KBC Convertible Opportunities
  Fund.........................  $  9,000,000       7.8%          529,268         529,268           *
+KBC Convertible Mac 28
  Limited......................  $  1,000,000         *            58,807          58,807           *
#KBC Financial Products USA
  Inc. ........................  $    500,000         *            29,403          29,403           *
Sturgeon Limited...............  $    385,000         *            22,640          22,640           *
+Sunrise Partners Limited
  Partnership..................  $ 11,500,000        10%          676,287         676,287         1.2%
#White River Securities
  L.L.C. ......................  $  1,250,000       1.1%           73,509          73,509           *
Zazove Convertible Arbitrage
  Fund L.P. ...................  $    250,000         *            14,701          14,701           *
Zurich Institutional Benchmarks
  Master Fund Ltd. ............  $    250,000         *            14,701          14,701           *
All other holders of notes or
  future transferees from such
  holders(1)...................    68,500,000      59.5%        4,028,320       4,028,320         7.0%
                                 ------------      ----         ---------       ---------
TOTALS.........................  $115,000,000       100%        6,762,864(3)    6,762,864(3)
</Table>

---------------
 *  Less than 1%

 # Broker-dealer

 + Affiliate of broker-dealer

(1) Other of these selling securityholders may be identified at a later date.

(2) BNP Paribas owns 25,568 shares of common stock not covered by this
    Prospectus.

(3) Excludes fractional shares payable in cash.

                                        39
<PAGE>

                         OTHER SELLING SECURITYHOLDERS

<Table>
<Caption>
                                                                                        NUMBER OF SHARES
                                                NUMBER OF SHARES    NUMBER OF SHARES     OF COMMON STOCK
                                                OF COMMON STOCK     OF COMMON STOCK        OWNED AFTER
                                                 OWNED PRIOR TO    TO BE SOLD IN THIS   COMPLETION OF THE
NAME                                             THIS OFFERING          OFFERING            OFFERING
----                                            ----------------   ------------------   -----------------
<S>                                             <C>                <C>                  <C>
+GE Capital CFE, Inc. ........................     907,650(1)           436,150(2)          471,500(1)
</Table>

---------------

(1) Includes 471,500 shares of common stock owned by General Electric Capital
    Corporation, which are not being offered hereby.

(2) Shares originally registered under Registration Statement No. 333-82210,
    effective February 28, 2002.

                              PLAN OF DISTRIBUTION

     The selling securityholders described in the preceding section and their
transferees, pledgees, donees and successors may sell the notes and the
underlying shares of common stock or the other shares of common stock directly
to purchasers or through underwriters, broker-dealers or agents, who may receive
compensation in the form of discounts, concessions or commissions from the
selling securityholders or the purchasers. These discounts, concessions or
commissions as to any particular underwriter, broker-dealer or agent may be in
excess of those customary in the types of transactions involved.

     The notes and the common stock may be sold in one or more transactions at:

     - fixed prices;

     - prevailing market prices at the time of sale;

     - prices related to the prevailing market prices;

     - varying prices determined at the time of sale; or

     - negotiated prices.

     In the case of common stock, these sales may be effected in transactions:

     - on any national securities exchange or quotation service on which our
       common stock may be listed or quoted at the time of sale, including The
       Nasdaq National Market;

     - in the over-the-counter market;

     - otherwise than on such exchanges or services or in the over-the-counter
       market;

     - through the writing of options, whether the options are listed on an
       options exchange or otherwise; or

     - through the settlement of short sales.

     These transactions may include block transactions or crosses. Crosses are
transactions in which the same broker acts as agent on both sides of the trade.

     In connection with the sale of the notes and the underlying common stock,
or otherwise, the selling securityholders may enter into hedging transactions
with broker-dealers or other financial institutions. These broker-dealers or
financial institutions may in turn engage in short sales of the common stock in
the course of hedging the positions they assume with the selling
securityholders. The selling security holders may also sell the notes and the
underlying common stock short and deliver these securities to close out such
short positions, or loan or pledge the notes or the underlying common stock to
broker-dealers that in turn may sell these securities.

     Selling securityholders may not sell any, or may not sell all, of the notes
and shares of common stock offered by them pursuant to this prospectus. In
addition, we cannot assure you that a selling security holder will not transfer,
devise or gift the notes and underlying shares of common stock by other means

                                        40
<PAGE>

not described in this prospectus. Moreover, any securities covered by this
prospectus that qualify for sale pursuant to Rule 144 or Rule 144A under the
Securities Act may be sold thereunder, rather than pursuant to this prospectus.

     The aggregate proceeds to the selling securityholders from the sale of the
notes or the underlying common stock offered pursuant to this prospectus will be
the purchase price of such securities less discounts and commissions, if any.
Each of the selling securityholders reserves the right to accept and, together
with their agents from time to time, reject in whole or in part any proposed
purchase of notes or common stock to be made directly or through their agents.
We will not receive any of the proceeds from the resale by the selling
securityholders of the notes or the common stock issuable upon conversion of the
notes.

     The notes are eligible for trading on The PORTAL Market. However, notes
sold pursuant to this prospectus will no longer be eligible for trading on The
PORTAL Market. We do not intend to list the notes on any securities exchange or
automated quotation system. Our common stock is listed for trading on The Nasdaq
National Market under the symbol "STLD."

     In order to comply with the securities laws of some states, if applicable,
the notes and the underlying common stock may be sold in these jurisdictions
only through registered or licensed brokers or dealers. In addition, in some
states the notes may not be sold unless they have been registered or qualified
for sale or an exemption from registration or qualifications requirements is
available and secured.

     The selling securityholders identified by the symbol "#" in the table in
the preceding section are broker-dealers, and, as such they are underwriters
within the meaning of Section 2(a)(11) of the Securities Act with respect to the
shares each of them may offer for sale, and subject to the prospectus delivery
requirements of the Securities Act as well as to statutory liabilities,
including, but not limited to, liabilities under Sections 11, 12 and 17 of the
Securities Act. With respect to selling securityholders that are affiliates of
broker-dealers, identified by the symbol "+" in the table in the preceding
section, we believe that such entities acquired their notes or underlying common
stock in the ordinary course of business, and at the time of the purchase such
selling securityholders had no agreements or understandings, directly or
indirectly, with any person to distribute the notes or underlying common stock.
To the extent that we become aware that any such entities did not acquire their
notes or underlying common stock in the ordinary course of business or did have
such an agreement or understanding, we will file a post-effective amendment to
the registration statement of which this prospectus forms a part to designate
such affiliate as an underwriter within the meaning of the Securities Act.

     In the event that a selling securityholder and any broker-dealers, agents
or underwriters that participate in the distribution of the notes and the
underlying common stock are underwriters within the meaning of the Securities
Act, any profits realized by the selling securityholders and any discounts,
commissions or concessions received by these broker-dealers, agents or
underwriters may be deemed to be underwriting discounts or commissions under the
Securities Act.

     The selling securityholders and any other persons participating in the
distribution of the notes and the underlying common stock will be subject to
applicable provisions of the Securities Exchange Act of 1934 and the rules and
regulations thereunder. Regulation M of the Exchange Act may limit the timing of
purchasers and sales of the notes and underlying common stock by the selling
securityholders and any such other person. In addition, Regulation M may
restrict the ability of any person participating in the distribution to engage
in market-making activities with respect to the particular securities being
distributed for a period of up to five business days prior to the commencement
of the distribution. This may affect the marketability of the notes and the
underlying common stock.

                                        41
<PAGE>

     With respect to a particular offering of the notes and underlying common
stock, to the extent required, an accompanying prospectus supplement or, if
appropriate, a post-effective amendment to the registration statement, of which
this prospectus is a part, will set forth the following information:

     - the specific notes or common stock to be offered or sold;

     - the names of the selling securityholders;

     - the respective purchase prices and public offering prices and other
       material terms of the offering;

     - the names of any participating agents, broker-dealers or underwriters;
       and

     - any applicable commissions, discounts, concessions and other items
       constituting compensation from the selling securityholders.

     We entered into the registration rights agreement for the benefit of the
holders of the notes to register their notes and the underlying common stock
under applicable federal and state securities laws under certain circumstances
and at certain times. The registration rights agreement provides that we and the
selling securityholders will indemnify each other and our respective directors,
officers and controlling persons against specific liabilities in connection with
the offer and sale of the notes and underlying common stock, including
liabilities under the Securities Act, or will be entitled to contribution in
connection with those liabilities. We will pay all of our expenses and specified
expenses incurred by the selling securityholders incidental to the registration,
offering and sale of the notes and underlying common stock to the public, but
each selling securityholder will be responsible for the payment of commissions,
concessions, fees and discounts of underwriters, broker-dealers and agents. We
estimate that the total expenses of this offering payable by us will be
approximately $136,804.

     We will use our reasonable best efforts to keep the registration statement,
of which this prospectus is a part, effective until the earlier of:

     - the sale pursuant to the registration statement of all of the securities
       registered thereunder; or

     - the expiration of the holding period under Rule 144(k) under the
       Securities Act, or any successor provision.

     We are permitted to suspend the use of this prospectus under specified
circumstances relating to pending corporate developments, public filings with
the SEC and similar events for a period not to exceed 30 days in any three-month
period, but not to exceed an aggregate of 90 days for all periods in any
12-month period. In addition, notwithstanding the foregoing, we are permitted to
suspend the use of this prospectus for up to 60 days in any three-month period
under certain circumstances relating to possible acquisitions, financings or
other similar transactions. We will pay predetermined liquidated damages if this
prospectus is unavailable for periods in excess of those permitted as described
above.

            CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS

GENERAL

     This is a summary of certain United States federal income tax consequences
relevant to holders of the notes. This summary is based upon laws, regulations,
rulings and decisions now in effect, all of which are subject to change
(including retroactive changes) or possible differing interpretations. The
discussion below deals only with notes held as capital assets and does not
purport to deal with persons in special tax situations, such as financial
institutions, insurance companies, regulated investment companies, dealers in
securities or currencies, tax-exempt entities, persons holding the notes in a
tax-deferred or tax-advantaged account, or persons holding the notes as a hedge
against currency risks, as a position in a "straddle" or as part of a "hedging"
or "conversion" transaction for tax purposes.

                                        42
<PAGE>

     We do not address all of the tax consequences that may be relevant to an
investor in the notes. In particular, we do not address:

     - the United States federal income tax consequences to shareholders in, or
       partners or beneficiaries of, an entity that is a holder of the notes;

     - the United States federal estate, gift or alternative minimum tax
       consequences of the purchase, ownership or disposition of the notes;

     - persons who hold the notes whose functional currency is not the United
       States dollar;

     - any state, local or foreign tax consequences of the purchase, ownership
       or disposition of the notes; or

     - any United States federal, state, local or foreign tax consequences of
       owning or disposing of our common stock.

     Persons considering the purchase of the notes should consult their own tax
advisors concerning the application of the United States federal income tax laws
to their particular situations as well as any consequences of the purchase,
ownership and disposition of the notes arising under the laws of any other
taxing jurisdiction.

     A U.S. holder is a beneficial owner of the notes who or which is:

     - a citizen or individual resident of the United States, as defined in
       Section 7701(b) of the Internal Revenue Code of 1986, as amended (which
       we refer to as the Code);

     - a corporation or partnership, including any entity treated as a
       corporation or partnership for United States federal income tax purposes,
       created or organized in or under the laws of the United States, any state
       thereof or the District of Columbia unless, in the case of a partnership,
       Treasury Regulations are enacted that provide otherwise;

     - an estate if its income is subject to United States federal income
       taxation regardless of its source; or

     - a trust if (1) a United States court can exercise primary supervision
       over its administration, and (2) one or more United States persons have
       the authority to control all of its substantial decisions.

     Notwithstanding the preceding sentence, certain trusts in existence on
August 20, 1996, and treated as U.S. persons prior to such date, may also be
treated as U.S. holders. A Non-U.S. holder is a beneficial owner of the notes
other than a U.S. holder.

     No statutory or judicial authority directly addresses the treatment of the
notes or instruments similar to the notes for United States federal income tax
purposes. The Internal Revenue Service (the "IRS") has recently issued a revenue
ruling with respect to instruments similar to the notes. To the extent it
addresses the issue, this ruling supports certain aspects of the treatment
described below. No ruling has been or is expected to be sought from the IRS
with respect to the United States federal income tax consequences of the issues
that are not addressed in the recently released revenue ruling. The IRS would
not be precluded from taking contrary positions. As a result, no assurance can
be given that the IRS will agree with all of the tax characterizations and the
tax consequences described below.

     WE URGE PROSPECTIVE INVESTORS TO CONSULT THEIR OWN TAX ADVISORS WITH
RESPECT TO THE TAX CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND
DISPOSITION OF THE NOTES AND OUR COMMON STOCK IN LIGHT OF THEIR OWN PARTICULAR
CIRCUMSTANCES, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL, FOREIGN AND
OTHER TAX LAWS AND THE POSSIBLE EFFECTS OF CHANGES IN UNITED STATES FEDERAL OR
OTHER TAX LAWS.

CLASSIFICATION OF THE NOTES

     We have received an opinion from our special tax counsel, Sidley Austin
Brown & Wood LLP, that the notes will be treated as indebtedness for United
States federal income tax purposes and that the notes

                                        43
<PAGE>

will be subject to the special regulations governing contingent payment debt
instruments (which we refer to as the CPDI regulations). Pursuant to the terms
of the indenture, we and each holder of the notes agree, for United States
federal income tax purposes, to treat the notes as debt instruments that are
subject to the CPDI regulations, and the remainder of this discussion assumes
that the notes will be so treated.

     In addition, under the indenture, each holder will be deemed to have agreed
to treat the fair market value of our common stock received by such holder upon
conversion as a contingent payment and to accrue interest with respect to the
notes as original issue discount for United States federal income tax purposes
according to the "noncontingent bond method," set forth in section 1.1275-4(b)
of the Treasury Regulations, using the comparable yield (as defined below)
compounded semiannually and the projected payment schedule (as defined below)
determined by us. Notwithstanding the issuance of the recent revenue ruling, the
application of the CPDI regulations to instruments such as the notes is
uncertain in several respects, and, as a result, no assurance can be given that
the IRS or a court will agree with the treatment described herein. Any differing
treatment could affect the amount, timing and character of income, gain or loss
in respect of an investment in the notes. In particular, a holder might be
required to accrue interest income at a higher or lower rate, might not
recognize income, gain or loss upon conversion of the notes into shares of our
common stock, and might recognize capital gain or loss upon a taxable
disposition of the notes. Holders should consult their tax advisors concerning
the tax treatment of holding the notes.

ACCRUAL OF INTEREST ON THE NOTES

     Pursuant to the CPDI regulations, a U.S. holder will be required to accrue
interest income on the notes, which we refer to as tax original issue discount,
in the amounts described below, regardless of whether the U.S. holder uses the
cash or accrual method of tax accounting. Accordingly, U.S. holders will likely
be required to include interest in taxable income in each year in excess of the
accruals on the notes for non-tax purposes (i.e., in excess of the stated
semi-annual cash interest payable on the notes and any contingent interest
payments) actually received in that year.

     The CPDI regulations provide that a U.S. holder must accrue an amount of
ordinary interest income, as original issue discount for United States federal
income tax purposes, for each accrual period prior to and including the maturity
date of the notes that equals:

     (1) the product of (i) the adjusted issue price (as defined below) of the
         notes as of the beginning of the accrual period and (ii) the comparable
         yield (as defined below) of the notes, adjusted for the length of the
         accrual period;

     (2) divided by the number of days in the accrual period; and

     (3) multiplied by the number of days during the accrual period that the
         U.S. holder held the notes.

     The notes' issue price is the first price at which a substantial amount of
the notes is sold to the public, excluding sales to bond houses, brokers or
similar persons or organizations acting in the capacity of underwriters,
placement agents or wholesalers. The adjusted issue price of a note is its issue
price increased by any interest income previously accrued, determined without
regard to any adjustments to interest accruals described below, and decreased by
the projected amount of any projected payments (as defined below) previously
made (including payments of stated cash interest) with respect to the notes.

     Sidley Austin Brown & Wood LLP, our special tax counsel, has advised us
that the term "comparable yield" means the annual yield we would pay, as of the
initial issue date, on a noncontingent, nonconvertible, fixed-rate debt
instrument with terms and conditions otherwise comparable to those of the notes.
Based in part on that advice, we intend to take the position that the comparable
yield for the notes is 9.25%, compounded semiannually. The precise manner of
calculating the comparable yield, however, is not entirely clear. If the
comparable yield were successfully challenged by the IRS, the redetermined yield
could be materially greater or less than the comparable yield provided by us.
Moreover, the projected payment schedule could differ materially from the
projected payment schedule provided by us.
                                        44
<PAGE>

     The CPDI regulations require that we provide to U.S. holders, solely for
United States federal income tax purposes, a schedule of the projected amounts
of payments, which we refer to as projected payments, on the notes. This
schedule must produce the comparable yield. The projected payment schedule
includes the semi-annual stated cash interest payable on the notes at the rate
of 4.0% per annum, estimates for certain contingent interest payments and an
estimate for a payment at maturity taking into account the conversion feature.
In this connection, the fair market value of any common stock (and cash, if any)
received by a holder upon conversion will be treated as a contingent payment.

     The comparable yield and the schedule of projected payments will be set
forth in the indenture. U.S. holders may also obtain the projected payment
schedule by submitting a written request for such information to: Steel
Dynamics, Inc., 6714 Pointe Inverness Way, Suite 200, Fort Wayne, Indiana 46804,
Attention: Tracy L. Shellabarger, Chief Financial Officer.

     THE COMPARABLE YIELD AND THE SCHEDULE OF PROJECTED PAYMENTS ARE NOT
DETERMINED FOR ANY PURPOSE OTHER THAN FOR THE DETERMINATION OF A U.S. HOLDER'S
INTEREST ACCRUALS AND ADJUSTMENTS THEREOF IN RESPECT OF THE NOTES FOR UNITED
STATES FEDERAL INCOME TAX PURPOSES AND DO NOT CONSTITUTE A PROJECTION OR
REPRESENTATION REGARDING THE ACTUAL AMOUNTS PAYABLE ON THE NOTES.

     Amounts treated as interest under the CPDI regulations are treated as
original issue discount for all purposes of the Code.

ADJUSTMENTS TO INTEREST ACCRUALS ON THE NOTES

     As noted above, the projected payment schedule includes amounts
attributable to the stated semi-annual cash interest payable on the notes.
Accordingly, the receipt of the stated semi-annual cash interest payments will
not be separately taxable to U.S. holders. If, during any taxable year, a U.S.
holder receives actual payments with respect to the notes for that taxable year
that in the aggregate exceed the total amount of projected payments for that
taxable year, the U.S. holder will incur a "net positive adjustment" under the
CPDI regulations equal to the amount of such excess. The U.S. holder will treat
a "net positive adjustment" as additional interest income. For this purpose, the
payments in a taxable year include the fair market value of property received in
that year, including the fair market value of our common stock received upon
conversion.

     If a U.S. holder receives in a taxable year actual payments with respect to
the notes for that taxable year that in the aggregate were less than the amount
of projected payments for that taxable year, the U.S. holder will incur a "net
negative adjustment" under the CPDI regulations equal to the amount of such
deficit. This adjustment will (a) first reduce the U.S. holder's interest income
on the notes for that taxable year and (b) to the extent of any excess after the
application of (a), give rise to an ordinary loss to the extent of the U.S.
holder's interest income on the notes during prior taxable years, reduced to the
extent such interest was offset by prior net negative adjustments. A negative
adjustment is not subject to the two percent floor limitation imposed on
miscellaneous itemized deductions under Section 67 of the Code. Any negative
adjustment in excess of the amounts described in (a) and (b) will be carried
forward and treated as a negative adjustment in the succeeding taxable year and
will offset future interest income accruals in respect of the notes or will
reduce the amount realized on the sale, exchange, purchase by us at the holder's
option, conversion, redemption or retirement of the notes.

     If a U.S. holder purchases notes at a discount or premium to the adjusted
issue price, the discount will be treated as a positive adjustment and the
premium will be treated as a negative adjustment. The U.S. holder must
reasonably allocate the adjustment over the remaining term of the notes by
reference to the accruals of original issue discount at the comparable yield or
to the projected payments. It may be reasonable to allocate the adjustment over
the remaining term of the notes pro rata with the accruals of original issue
discount at the comparable yield. You should consult your tax advisors regarding
these allocations.

                                        45
<PAGE>

SALE, EXCHANGE, CONVERSION OR REDEMPTION

     Generally, the sale or exchange of a note, the purchase of a note by us at
the holder's option, or the redemption or retirement of a note for cash, will
result in taxable gain or loss to a U.S. holder. As described above, our
calculation of the comparable yield and the schedule of projected payments for
the notes includes the receipt of common stock upon conversion as a contingent
payment with respect to the notes. Accordingly, we intend to treat the receipt
of our common stock by a U.S. holder upon the conversion of a note as a
contingent payment under the CPDI Regulations. Under this treatment, conversion
also would result in taxable gain or loss to the U.S. holder. As described
above, holders will be deemed to have agreed to be bound by our determination of
the comparable yield and the schedule of projected payments.

     The amount of gain or loss on a taxable sale, exchange, purchase by us at
the holder's option, conversion, redemption or retirement would be equal to the
difference between (a) the amount of cash plus the fair market value of any
other property received by the U.S. holder, including the fair market value of
any of our common stock received, and (b) the U.S. holder's adjusted tax basis
in the note. A U.S. holder's adjusted tax basis in a note will generally be
equal to the U.S. holder's original purchase price for the note, increased by
any interest income previously accrued by the U.S. holder (determined without
regard to any adjustments to interest accruals described above, other than
adjustments to reflect a discount or premium to the adjusted issue price, if
any), and decreased by the amount of any projected payments that have been
previously made in respect of the notes to the U.S. holder (without regard to
the actual amount paid). Gain recognized upon a sale, exchange, purchase by us
at the holder's option, conversion, redemption or retirement of a note will
generally be treated as ordinary interest income; any loss will be ordinary loss
to the extent of interest previously included in income, and thereafter, capital
loss (which will be long-term if the note is held for more than one year). The
deductibility of net capital losses by individuals and corporations is subject
to limitations.

     A U.S. holder's tax basis in our common stock received upon a conversion of
a note will equal the then current fair market value of such common stock. The
U.S. holder's holding period for the common stock received will commence on the
day immediately following the date of conversion.

CONSTRUCTIVE DIVIDENDS

     If at any time we were to make a distribution of property to our
stockholders that would be taxable to the stockholders as a dividend for United
States federal income tax purposes and, in accordance with the antidilution
provisions of the notes, the conversion rate of the notes were increased, such
increase might be deemed to be the payment of a taxable dividend to holders of
the notes.

     For example, an increase in the conversion rate in the event of
distributions of our evidences of indebtedness, or assets, or an increase in the
event of an extraordinary cash dividend may result in deemed dividend treatment
to holders of the notes, but generally an increase in the event of stock
dividends or the distribution of rights to subscribe for common stock would not
be so treated.

LIQUIDATED DAMAGES

     We may be required to make payments of liquidated damages if the shelf
registration statement is not timely filed or made effective or if the
prospectus is unavailable for periods in excess of those permitted by the
registration rights agreement, as described under "Description of Notes --
Registration Rights of the Noteholders." We intend to take the position for
United States federal income tax purposes that any payments of liquidated
damages should be taxable to U.S. holders as additional ordinary income when
received or accrued, in accordance with their method of tax accounting. Our
determination is binding on holders of the notes, unless they explicitly
disclose that they are taking a different position to the IRS on their tax
returns for the year during which they acquire the note. The IRS could take a
contrary position from that described above, which could affect the timing and
character of U.S. holders' income from the notes with respect to the payments of
liquidated damages.

                                        46
<PAGE>

     U.S. holders should consult their tax advisers concerning the appropriate
tax treatment of the payment of liquidated damages, if any, with respect to the
notes.

TREATMENT OF NON-U.S. HOLDERS

     All payments on the notes made to a Non-U.S. holder will be exempt from
United States income or withholding tax provided that: (i) such Non-U.S. holder
does not own, actually, indirectly or constructively, 10% or more of the total
combined voting power of all classes of our stock entitled to vote, and is not a
controlled foreign corporation related, directly or indirectly, to us through
stock ownership; (ii) the statement requirement set forth in section 871(h) or
section 881(c) of the Code has been fulfilled with respect to the beneficial
owner, as discussed below; (iii) such payments and gain are not effectively
connected with the conduct by such Non-U.S. holder of a trade or business in the
United States; (iv) our common stock continues to be, and the notes are,
actively traded within the meaning of section 871(h)(4)(C)(v)(I) of the Code
(which, for these purposes and subject to certain exceptions, includes trading
on the Nasdaq National Market); and (v) we are not a "United States real
property holding corporation." We believe that we are not and do not anticipate
becoming a "United States real property holding corporation." However, if a
Non-U.S. holder were deemed to have received a constructive dividend (see "--
Constructive Dividends" above), the Non-U.S. holder will generally be subject to
United States federal withholding tax at a 30% rate, subject to a reduction by
an applicable treaty, on the taxable amount of such dividend.

     The statement requirement referred to in the preceding paragraph will be
fulfilled if the beneficial owner of a note certifies on IRS Form W-8BEN, under
penalties of perjury, that it is not a United States person and provides its
name and address or otherwise satisfies applicable documentation requirements. A
holder of a note which is not an individual or corporation (or an entity treated
as a corporation for United States federal income tax purposes) holding the
notes on its own behalf may have substantially increased reporting requirements.
In particular, in the case of notes held by a foreign partnership (or certain
foreign trusts), the partnership (or trust) will be required to provide the
certification from each of its partners (or beneficiaries), and the partnership
(or trust) will be required to provide certain additional information. If a
Non-U.S. holder of the notes is engaged in a trade or business in the United
States, and if interest on the notes is effectively connected with the conduct
of such trade or business, the Non-U.S. holder, although exempt from the
withholding tax discussed in the preceding paragraphs, will generally be subject
to regular United States federal income tax on interest and on any gain realized
on the sale, exchange, purchase by us at the holder's option, conversion,
redemption or retirement of the notes in the same manner as if it were a U.S.
holder. In lieu of the certificate described in the preceding paragraph, such a
Non-U .S. holder would be required to provide to the withholding agent a
properly executed IRS Form W-8ECI (or successor form) in order to claim an
exemption from withholding tax. In addition, if such a Non-U.S. holder is a
foreign corporation, such holder may be subject to a branch profits tax equal to
30% (or such lower rate provided by an applicable treaty) of its effectively
connected earnings and profits for the taxable year, subject to certain
adjustments.

BACKUP WITHHOLDING TAX AND INFORMATION REPORTING

     Payments of principal, premium, if any, and interest (including original
issue discount and a payment in common stock pursuant to a conversion of the
notes) on, and the proceeds of dispositions of, the notes may be subject to
information reporting and United States federal backup withholding tax at the
applicable statutory rate if the U.S. holder thereof fails to supply an accurate
taxpayer identification number or otherwise fails to comply with applicable
United States information reporting or certification requirements. A Non-U.S.
holder may be subject to United States backup withholding tax on payments on the
notes and the proceeds from a sale or other disposition of the notes unless the
Non-U.S. holder complies with certification procedures to establish that it is
not a United States person. Any amounts so withheld will be allowed as a credit
against a holder's United States federal income tax liability and may entitle a
holder to a refund, provided the required information is timely furnished to the
IRS.

                                        47
<PAGE>

                          CERTAIN ERISA CONSIDERATIONS

     The following is a summary of certain considerations associated with the
purchase of the notes by employee benefit plans that are subject to Title I of
the U.S. Employee Retirement Income Security Act of 1974, as amended, known as
"ERISA," individual retirement accounts and other arrangements that are subject
to Section 4975 of the Code or provisions under any federal, state, local,
non-U.S. or other laws or regulations that are similar to such provisions of the
Code or ERISA, as well as entities whose underlying assets are considered to
include "assets" of such plans, accounts and arrangements, each of which we will
refer to as a "Plan."

GENERAL FIDUCIARY MATTERS

     ERISA and the Code impose certain duties on persons who are fiduciaries of
a Plan subject to Title I of ERISA or Section 4975 of the Code (an "ERISA Plan")
and prohibit certain transactions involving the assets of an ERISA Plan and
certain "parties in interest," within the meaning of ERISA, or "disqualified
persons," within the meaning of Section 4975 of the Code.

     In considering an investment in the notes of a portion of the assets of any
Plan, a fiduciary should determine whether the investment is in accordance with
the documents and instruments governing the Plan and the applicable provisions
of ERISA, the Code or any similar law relating to a fiduciary's duties to the
Plan, including without limitation, the prudence, diversification, delegation of
control and prohibited transaction provisions of ERISA, the Code and any other
similar applicable laws.

     Any insurance company proposing to invest assets of its general account in
the notes should consider the extent that such investment would be subject to
the requirements of ERISA in light of the U.S. Supreme Court's decision in John
Hancock Mutual Life Insurance Co. v. Harris Trust and Savings Bank and under any
subsequent legislation or other guidance that has or may become available
relating to that decision, including the enactment of Section 401(c) of ERISA by
the Small Business Job Protection Act of 1996 and the regulations promulgated
thereunder.

PROHIBITED TRANSACTION ISSUES

     Section 406 of ERISA and Section 4975 of the Code prohibit ERISA Plans from
engaging in specified transactions involving plan assets with persons or
entities who are parties in interest or disqualified persons, unless an
exemption is available. A party in interest or disqualified person who engaged
in a non-exempt prohibited transaction may be subject to excise taxes and other
penalties and liabilities under ERISA and the Code. The acquisition and/or
holding of notes by an ERISA Plan with respect to which we, or the initial
purchasers, are considered a party in interest or a disqualified person may
constitute or result in a direct or indirect prohibited transaction under
Section 406 of ERISA and/or Section 4975 of the Code, unless the investment is
acquired and is held in accordance with an applicable statutory, class or
individual prohibited transaction exemption. In this regard, the U.S. Department
of Labor has issued prohibited transaction class exemptions, or "PTCEs," that
may apply to the acquisition and holding of the notes. These class exemptions
include, without limitation, PTCE 84-14 respecting transactions determined by
independent qualified professional asset managers, PTCE 90-1 respecting
insurance company pooled separate accounts, PTCE 91-38 respecting bank
collective investment trust funds, PTCE 95-60 respecting life insurance company
general accounts and PTCE 96-23 respecting transactions determined by in-house
asset managers, although there can be no assurance that the conditions of any
such exemptions will be satisfied.

DEEMED REPRESENTATIONS

     Because of the foregoing, the notes should not be purchased or held by any
person investing assets of any Plan, unless such purchase and holding will not
constitute a non-exempt prohibited transaction under ERISA and the Code or
similar violation of any applicable similar laws. Accordingly, by acceptance of
a note, each purchaser and subsequent transferee of a note will be deemed to
represent and warrant that it is

                                        48
<PAGE>

not using assets of a Plan to purchase or hold the notes or that its purchase
and holding of the notes will be covered by an applicable prohibited transaction
exemption.

     The foregoing discussion is general in nature and is not intended to be all
inclusive. Due to the complexity of these rules and the penalties that may be
imposed upon persons involved in non-exempt prohibited transactions, it is
particularly important that fiduciaries, or other persons considering purchasing
the notes on behalf of, or with the assets of, any Plan, consult with their
counsel regarding the potential applicability of ERISA, Section 4975 of the Code
and any similar laws to such investment and whether an exemption would be
applicable to the purchase and holding of the notes.

                                 LEGAL MATTERS

     The validity of the notes and the shares of our common stock issuable upon
conversion of the notes have been passed upon for us by Barrett & McNagny LLP,
Fort Wayne, Indiana. Members of the firm of Barrett & McNagny LLP own shares of
our common stock amounting to less than one-half of 1% of our outstanding
shares. Sidley Austin Brown & Wood LLP, New York, New York has rendered an
opinion for us with respect to certain federal income tax consequences of the
notes.

                                    EXPERTS

     The consolidated financial statements of Steel Dynamics, Inc. appearing in
Steel Dynamics, Inc.'s Annual Report (Form 10-K) for the year ended December 31,
2001 have been audited by Ernst & Young LLP, independent auditors, as set forth
in their report thereon included therein and incorporated herein by reference.
Such consolidated financial statements are incorporated herein by reference in
reliance upon such report given on the authority of such firm as experts in
accounting and auditing.

                      WHERE YOU CAN FIND MORE INFORMATION

     We file annual, quarterly and special reports, proxy statements and other
information with the Securities and Exchange Commission. You may read and copy
materials that we have filed with the Securities and Exchange Commission at the
Securities and Exchange Commission's public reference room at 450 Fifth Street,
N.W., Room 1024, Washington, D.C. 20549. Please call the Securities and Exchange
Commission at 1-800-SEC-0330 for further information on the public reference
room. Our Securities and Exchange Commission filings are also available to the
public on the Securities and Exchange Commission's Internet website at
http://www.sec.gov.

     Our common stock is quoted on Nasdaq National Market under the symbol
"STLD," and our Securities and Exchange Commission filings can also be read at
Nasdaq Operations, 1735 K Street, N.W., Washington, D.C. 20006.

     You may find additional information about us at our website at
http://www.steeldynamics.com. The information on our website, however, is not a
part of this prospectus.

                     INFORMATION INCORPORATED BY REFERENCE

     The SEC allows us to "incorporate by reference" into this prospectus the
information we file with the SEC, which means that we can disclose important
information to you by referring you to those documents. Any information
referenced this way is considered to be a part of this prospectus, and any
information that we later file with the SEC will automatically update and
supersede this information. We incorporate by reference into this prospectus the
following documents that we have previously filed with the SEC and any future
filings that we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of
the Exchange Act

                                        49
<PAGE>

after the date of this prospectus until all of the securities covered by this
prospectus are sold by the selling securityholders:

     - Our Annual Report on Form 10-K for our fiscal year ended December 31,
       2001.

     - Our Quarterly Reports on Form 10-Q for our fiscal quarters ended March
       31, 2002 and June 30, 2002 and our Quarterly Report on Form 10-Q/A for
       the quarter ended September 30, 2002.

     - Our definitive proxy statement filed on April 10, 2002.

     - Our Reports on Form 8-K or 8-K/A filed on February 5, 2002, February 26,
       2002, February 27, 2002, March 14, 2002, May 10, 2002, November 14, 2002,
       December 18, 2002, January 2, 2003 and February 4, 2003.

     - Description of Registrant's common stock, incorporated by reference from
       Exhibit 4.1 of Registrant's Form 8-A, SEC File No. 96661016, filed
       November 13, 1996.

     You may request a copy of these filings, at no cost, by writing to or
telephoning us at the following address:

                              Steel Dynamics, Inc.
                           6714 Pointe Inverness Way
                                   Suite 200
                           Fort Wayne, Indiana 46804
                             Tel No: (260) 459-3553
                        Attention: Tracy L. Shellabarger
                            Chief Financial Officer

                                        50
<PAGE>

                                    PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

     The following table sets forth the costs and expenses payable by the
Registrant in connection with the registration and resales of the 4% Convertible
Subordinated Notes due 2012 and the shares of common stock into which the notes
are convertible. All of the amounts shown are estimates, except the SEC
registration fee and The Nasdaq Stock Market subsequent listing fee. The Nasdaq
Stock Market subsequent listing fee assumes the debentures are converted into
6,762,874 shares of common stock.

<Table>
<Caption>
                                                              ESTIMATED
EXPENSE                                                        AMOUNT
-------                                                       ---------
<S>                                                           <C>
Securities and Exchange Commission registration fee.........  $  9,304
The Nasdaq Stock Market subsequent listing fee..............     7,500
Legal fees and expenses.....................................    50,000
Accounting fees and expenses................................    10,000
Trustee fees................................................    20,000
Printing fees and expenses..................................    30,000
Miscellaneous expenses......................................    10,000
                                                              --------
     Total..................................................  $136,804
</Table>

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS

     As permitted by Chapter 37 of the Indiana Business Corporation Law, Article
IX of our Amended and Restated Articles of Incorporation provides that we shall
indemnify a director or officer against liability, including expenses and costs
of defense, incurred in any proceeding, if that individual was made a party to
the proceeding because the individual is or was a director or officer, or, at
our request, was serving as a director, officer, partner, trustee, employee, or
agent of another corporation, partnership, joint venture, trust, employee
benefit plan, or other enterprise, whether or not for profit, so long as the
individual's conduct was in good faith and with the reasonable belief, in
connection with the individual's "official capacity," that the conduct was in
our best interests, or, in all other cases, that the conduct was at least not
opposed to our best interests. In the case of any criminal proceeding, the duty
to indemnify applies so long as the individual either had reasonable cause to
believe that the conduct was lawful, or had no reasonable cause to believe that
the conduct was unlawful. Conduct with respect to an employee benefit plan in
connection with a matter the individual believed to be in the best interests of
the participants and beneficiaries of the plan is deemed conduct that satisfies
the indemnification standard that the individual reasonably believed that the
conduct was at least not opposed to our best interests.

     We may advance or reimburse for reasonable expenses incurred by a person
entitled to indemnification, in advance of final disposition, if the individual
furnishes us with a written affirmation of his or her good faith belief that the
applicable standard of conduct was observed, accompanied by a written
undertaking to repay the advance if it is ultimately determined that the
applicable standards were not met.

     In all cases, whether in connection with advancement of expenses during a
proceeding, or afterward, we may not grant indemnification unless authorized in
the specific case after a determination has been made that indemnification is
permissible under the circumstances. The determination may be made either by our
board of directors, by majority vote of a quorum consisting of directors not at
the time parties to the proceeding, or, if a quorum cannot be so obtained, then
by majority vote of a committee duly designated by the board of directors
consisting solely of two or more directors not at the time parties to the
proceeding. Alternatively, the determination can be made by special legal
counsel selected by the board of directors or the committee, or by the
stockholders, excluding shares owned by or voted under the

                                        51
<PAGE>

control of persons who are at the time parties to the proceeding. In the event
that a person seeking indemnification believes that it has not been properly
provided that person may apply for indemnification to the court conducting the
proceeding or to another court of competent jurisdiction. In such a proceeding,
a court is empowered to grant indemnification if it determines that the person
is fairly and reasonably entitled to indemnification in view of all of the
relevant circumstances, whether or not the person met the standard of conduct
for indemnification.

     We may purchase and maintain insurance on behalf of our directors,
officers, employees or agents, insuring against liability arising from his or
her status as a director, officer, employee, or agent, whether or not we would
have the power to indemnify the individual against the same liability under
Article IX.

     Article IX does not preclude us from providing indemnification in any other
manner.

     The indemnification provisions set forth in Article IX of the Amended and
Restated Articles of Incorporation, as well as the authority vested in our board
of directors by Chapter 37 of the Business Corporation Law to grant
indemnification beyond that which is described in Article IX, may be
sufficiently broad to provide indemnification of our directors and officers for
liabilities arising under the Securities Act.

     Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to our directors, officers and controlling persons pursuant to
the foregoing provisions, we have been advised that in the opinion of the SEC
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities, other than the payment of expenses incurred or paid by
a director, officer or controlling person in the successful defense of any
action, suit or proceeding, is asserted by such director, officer or controlling
person in connection with the securities being registered, we will, unless in
the opinion of our counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by us is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.

     We have obtained liability insurance for the benefit of our directors and
officers which provides coverage for losses of directors and officers for
liabilities arising out of claims against such persons acting as our officers or
directors, or any of our subsidiaries, due to any breach of duty, neglect,
error, misstatement, misleading statement, omission or act done by such
directors and officers, except as prohibited by law.

ITEM 16. EXHIBITS

     (A) Exhibits.

<Table>
<Caption>
EXHIBIT NO.                           DESCRIPTION
-----------                           -----------
<C>           <S>
   2.1        Agreement (Settlement Agreement), dated as of January 28,
              2002, by and among Iron Dynamics, Inc., Steel Dynamics,
              Inc., various signatory lender banks, and Mellon Bank, N.A.
              as Agent for the Iron Dynamics lenders, incorporated by
              reference from Exhibit 2.1 to our Report on Form 8-K, filed
              February 26, 2002.
   3.1a       Amended and Restated Articles of Incorporation of Steel
              Dynamics, Inc., incorporated by reference from Exhibit 3.1a
              in Registrant's Registration Statement on Form S-1, SEC File
              No. 333-12521, effective November 21, 1996.
   3.1b       Articles of Incorporation of Iron Dynamics, Inc.,
              incorporated by reference from Registrant's 1996 Annual
              Report on Form 10-K, filed March 31, 1997.
   3.2a       Amended Bylaws of Steel Dynamics, Inc., incorporated herein
              by reference from Exhibit 3.2a to our Registration Statement
              on Form S-3, SEC File No. 333-82210, effective February 28,
              2002.
   4.1c*      Registration Rights Agreement between Steel Dynamics, Inc.
              as Issuer and Morgan Stanley & Co. Incorporated and Goldman,
              Sachs & Co. as Initial Purchasers, dated as of December 23,
              2002, re $100,000,000 of our 4% Convertible Subordinated
              Notes due 2012.
</Table>

                                        52
<PAGE>

<Table>
<Caption>
EXHIBIT NO.                           DESCRIPTION
-----------                           -----------
<C>           <S>
   4.2a*      Indenture relating to our 4% Convertible Subordinated Notes
              due 2012, dated as of December 23, 2002, between Steel
              Dynamics, Inc. and Fifth Third Bank, Indiana as Trustee.
   5.1*       Opinion of Barrett & McNagny LLP.
   8.1*       Opinion of Sidley Austin Brown & Wood LLP.
  12.1*       Statement re computation of ratios of earnings to fixed
              charges for each year in the five-year period ended December
              31, 2001 and nine months ended September 30, 2002.
  23.1*       Consent of Barrett & McNagny LLP (included in Exhibit 5.1).
  23.2*       Consent of Sidley Austin Brown & Wood LLP (included in
              Exhibit 8.1).
  23.3*       Consent of Ernst & Young LLP.
  24.1        Powers of attorney (see signature page on page II-55).
  25.1*       Form T-1, Trustee's Statement of Eligibility.
</Table>

---------------

  * Filed concurrently herewith

ITEM 17. UNDERTAKINGS

     Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (the "Securities Act") may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.

     (a) The undersigned Registrant hereby undertakes:

          (1) To file, during any period in which offers or sales are being
     made, a post-effective amendment to this registration statement:

             (i) To include any prospectus required by Section 10(a)(3) of the
        Securities Act;

             (ii) To reflect in the prospectus any facts or events arising after
        the effective date of the registration statement (or the most recent
        post-effective amendment thereof) which, individually or in the
        aggregate, represent a fundamental change in the information set forth
        in the registration statement; and

             (iii) To include any material information with respect to the plan
        of distribution not previously disclosed in the registration statement
        or any material change to such information in the registration
        statement.

          (2) That, for the purpose of determining any liability under the
     Securities Act, each such post-effective amendment shall be deemed to be a
     new registration statement relating to the securities offered therein, and
     the offering of such securities at that time shall be deemed to be the
     initial bona fide offering thereof.

                                        53
<PAGE>

          (3) To remove from registration by means of a post-effective amendment
     any of the securities being registered which remain unsold at the
     termination of the offering.

     (b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

                                        54
<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Fort Wayne, State of Indiana, on March 7, 2003.

     Pursuant to the requirements of the Securities Act, this registration
statement has been signed by the following persons in the capacities indicated
on March 7, 2003.

                                          STEEL DYNAMICS, INC.

                                          By: /s/ KEITH E. BUSSE
                                            ------------------------------------

                                          Name: Keith E. Busse
                                              ----------------------------------

                                          Title: President and Chief Executive
                                                 Officer
                                             -----------------------------------

                               POWER OF ATTORNEY

     KNOW ALL PERSONS BY THESE PRESENTS, that each individual whose signature
appears below constitutes and appoints Keith E. Busse and Tracy L. Shellabarger,
and each of them, his true and lawful attorneys-in-fact and agents, with full
power of substitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this registration statement, and to sign any registration statement for the
same offering covered by this registration statement that is to be effective
upon filing pursuant to Rule 462(b) promulgated under the Securities Act of
1933, as amended, and all post-effective amendments thereto, and to file the
same, with all exhibits thereto and all documents in connection therewith, with
the Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or his or their
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:

<Table>
<S>                                               <C>

               /s/ KEITH E. BUSSE                  President and Chief Executive Officer (principal
------------------------------------------------                  executive officer)
                 Keith E. Busse




              /s/ MARK D. MILLETT                             Vice President and Director
------------------------------------------------
                Mark D. Millett




           /s/ RICHARD P. TEETS, JR.                          Vice President and Director
------------------------------------------------
             Richard P. Teets, Jr.




           /s/ TRACY L. SHELLABARGER                  Vice President, Chief Financial Officer and
------------------------------------------------     Director (principal financial and accounting
             Tracy L. Shellabarger                                     officer)
</Table>

                                        55
<PAGE>

<Table>
<S>                                               <C>




               /s/ JOHN C. BATES                                              Director
------------------------------------------------
                 John C. Bates




                                                                              Director
------------------------------------------------
                Dr. Jurgen Kolb




             /s/ JOSEPH D. RUFFOLO                                            Director
------------------------------------------------
               Joseph D. Ruffolo




                                                                              Director
------------------------------------------------
                  Naoki Hidaka




                                                                              Director
------------------------------------------------
              Richard J. Freeland




                                                                              Director
------------------------------------------------
                James E. Kelley




              /s/ PAUL B. EDGERLEY                                            Director
------------------------------------------------
                Paul B. Edgerley




              /s/ DANIEL M. RIFKIN                                            Director
------------------------------------------------
                Daniel M. Rifkin
</Table>

                                        56
<PAGE>

                                 EXHIBIT INDEX

EXHIBITS

<Table>
<Caption>
EXHIBIT NO.                           DESCRIPTION
-----------                           -----------
<C>           <S>
   2.1        Agreement (Settlement Agreement), dated as of January 28,
              2002, by and among Iron Dynamics, Inc., Steel Dynamics,
              Inc., various signatory lender banks, and Mellon Bank, N.A.
              as Agent for the Iron Dynamics lenders, incorporated by
              reference from Exhibit 2.1 to our Report on Form 8-K, filed
              February 26, 2002.
   3.1a       Amended and Restated Articles of Incorporation of Steel
              Dynamics, Inc., incorporated by reference from Exhibit 3.1a
              in Registrant's Registration Statement on Form S-1, SEC File
              No. 333-12521, effective November 21, 1996.
   3.1b       Articles of Incorporation of Iron Dynamics, Inc.,
              incorporated by reference from Registrant's 1996 Annual
              Report on Form 10-K, filed March 31, 1997.
   3.2a       Amended Bylaws of Steel Dynamics, Inc., incorporated herein
              by reference from Exhibit 3.2a to our Registration Statement
              on Form S-3, SEC File No. 333-82210, effective February 28,
              2002.
   4.1c*      Registration Rights Agreement between Steel Dynamics, Inc.
              as Issuer and Morgan Stanley & Co. Incorporated and Goldman,
              Sachs & Co. as Initial Purchasers, dated as of December 23,
              2002, re $100,000,000 of our 4% Convertible Subordinated
              Notes due 2012.
   4.2a*      Indenture relating to our 4% Convertible Subordinated Notes
              due 2012, dated as of December 23, 2002, between Steel
              Dynamics, Inc. and Fifth Third Bank, Indiana as Trustee.
   5.1*       Opinion of Barrett & McNagny LLP.
   8.1*       Opinion of Sidley Austin Brown & Wood LLP.
  12.1*       Statement re computation of ratios of earnings to fixed
              charges for each year in the five-year period ended December
              31, 2001 and nine months ended September 30, 2002.
  23.1*       Consent of Barrett & McNagny LLP (included in Exhibit 5.1).
  23.2*       Consent of Sidley Austin Brown & Wood LLP (included in
              Exhibit 8.1).
  23.3*       Consent of Ernst & Young LLP.
  24.1        Powers of attorney (see signature page on page II-55).
  25.1*       Form T-1, Trustee's Statement of Eligibility.
</Table>

---------------

  * Filed concurrently herewith

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.1.C
<SEQUENCE>3
<FILENAME>y84184exv4w1wc.txt
<DESCRIPTION>REGISTRATION RIGHTS AGREEMENT
<TEXT>
<PAGE>

                                                                  EXECUTION COPY

                                                                    EXHIBIT 4.1C

                          REGISTRATION RIGHTS AGREEMENT

                                     BETWEEN

                              STEEL DYNAMICS, INC.

                                   AS ISSUER,

                                       AND

                        MORGAN STANLEY & CO. INCORPORATED

                                       AND

                              GOLDMAN, SACHS & CO.

                              AS INITIAL PURCHASERS

                          DATED AS OF DECEMBER 23, 2002
<PAGE>

      REGISTRATION RIGHTS AGREEMENT dated as of December 23, 2002 between Steel
Dynamics, a Delaware corporation (the "COMPANY"), and Morgan Stanley & Co.
Incorporated and Goldman, Sachs & Co. (the "INITIAL PURCHASERS") pursuant to the
Purchase Agreement dated December 17, 2002 (the "PURCHASE AGREEMENT"), between
the Company and the Initial Purchasers. In order to induce the Initial
Purchasers to enter into the Purchase Agreement, the Company has agreed to
provide the registration rights set forth in this Agreement. The execution of
this Agreement is a condition to the closing under the Purchase Agreement.

      The Company agrees with the Initial Purchasers, (i) for their benefit as
Initial Purchasers and (ii) for the benefit of the beneficial owners (including
the Initial Purchasers) from time to time of the Notes (as defined herein) and
the beneficial owners from time to time of the Underlying Common Stock (as
defined herein) issued upon conversion of the Notes (each of the foregoing a
"HOLDER" and together the "HOLDERS"), as follows:

      SECTION 1. Definitions. Capitalized terms used herein without definition
shall have their respective meanings set forth in the Purchase Agreement. As
used in this Agreement, the following terms shall have the following meanings:

      "AFFILIATE" means with respect to any specified person, an "affiliate," as
defined in Rule 144, of such person.

      "AMENDMENT EFFECTIVENESS DEADLINE DATE" has the meaning set forth in
Section 2(d) hereof.

      "BUSINESS DAY" means each Monday, Tuesday, Wednesday, Thursday and Friday
that is not a day on which banking institutions in The City of New York are
authorized or obligated by law or executive order to close.

      "COMMON STOCK" means the shares of common stock, par value $.01 per share,
of the Company and any other shares of common stock as may constitute "Common
Stock" for purposes of the Indenture, including the Underlying Common Stock.

      "CONVERSION PRICE" has the meaning assigned such term in the Indenture.

      "DAMAGES ACCRUAL PERIOD" has the meaning set forth in Section 2(e) hereof.

      "DAMAGES PAYMENT DATE" means each June 15 and December 15.

      "DEFERRAL NOTICE" has the meaning set forth in Section 3(h) hereof.

      "DEFERRAL PERIOD" has the meaning set forth in Section 3(h) hereof.

      "EFFECTIVENESS DEADLINE DATE" has the meaning set forth in Section 2(a)
hereof.

      "EFFECTIVENESS PERIOD" means the period commencing on the date hereof and
ending on the date that all Registrable Securities have ceased to be Registrable
Securities.


                                       2
<PAGE>

      "EVENT" has the meaning set forth in Section 2(e) hereof.

      "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the SEC promulgated thereunder.

      "FILING DEADLINE DATE" has the meaning set forth in Section 2(a) hereof.

      "HOLDER" has the meaning set forth in the second paragraph of this
Agreement.

      "INDENTURE" means the Indenture, dated as of December 23, 2002, between
the Company and Fifth Third Bank, as trustee, pursuant to which the Notes are
being issued.

      "INITIAL PURCHASERS" means Morgan Stanley & Co. Incorporated and Goldman,
Sachs & Co.

      "INITIAL SHELF REGISTRATION STATEMENT" has the meaning set forth in
Section 2(a) hereof.

      "ISSUE DATE" means December 23, 2002.

      "LIQUIDATED DAMAGES AMOUNT" has the meaning set forth in Section 2(e)
hereof.

      "MATERIAL EVENT" has the meaning set forth in Section 3(h) hereof.

      "NOTES" means the 4% Convertible Subordinated Notes Due 2012 of the
Company to be purchased pursuant to the Purchase Agreement.

      "NOTICE AND QUESTIONNAIRE" means a written notice delivered to the Company
containing substantially the information called for by the Selling
Securityholder Notice and Questionnaire attached as Annex A to the Offering
Memorandum of the Company dated December 17, 2002 relating to the Notes.

      "NOTICE HOLDER" means, on any date, any Holder that has delivered a Notice
and Questionnaire to the Company on or prior to such date.

      "PURCHASE AGREEMENT" has the meaning set forth in the preamble hereof.

      "PROSPECTUS" means the prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Securities Act), as
amended or supplemented by any amendment or prospectus supplement, including
post-effective amendments, and all materials incorporated by reference or
explicitly deemed to be incorporated by reference in such Prospectus.

      "RECORD HOLDER" means with respect to any Damages Payment Date relating to
any Notes or Underlying Common Stock as to which any Liquidated Damages Amount
has accrued, the registered holder of such Note or Underlying Common Stock on
the June 1 immediately preceding a Damages Payment Date occurring on a June 15,
and on the December 1 immediately preceding a Damages Payment Date occurring on
a December 15.


                                       3
<PAGE>

      "REGISTRABLE SECURITIES" means the Notes until such Notes have been
converted into or exchanged for the Underlying Common Stock and, at all times
subsequent to any such conversion, the Underlying Common Stock and any
securities into or for which such Underlying Common Stock has been converted or
exchanged, and any security issued with respect thereto upon any stock dividend,
split or similar event until, in the case of any such security, (A) the earliest
of (i) its effective registration under the Securities Act and resale in
accordance with the Registration Statement covering it, (ii) expiration of the
holding period that would be applicable thereto, under Rule 144(k) or (iii) its
sale to the public pursuant to Rule 144 (or any similar provision then in force,
but not Rule 144A) under the Securities Act, and (B) as a result of the event or
circumstance described in any of the foregoing clauses (i) through (iii), the
legend with respect to transfer restrictions required under the Indenture is
removed or removable in accordance with the terms of the Indenture or such
legend, as the case may be.

      "REGISTRATION STATEMENT" means any registration statement of the Company
that covers any of the Registrable Securities pursuant to the provisions of this
Agreement, including the Prospectus, amendments and supplements to such
registration statement, including post-effective amendments, all exhibits and
all materials incorporated by reference or explicitly deemed to be incorporated
by reference in such registration statement.

      "RESTRICTED SECURITIES" means "Restricted Securities" as defined in Rule
144.

      "RULE 144" means Rule 144 under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulation hereafter adopted
by the SEC.

      "RULE 144A" means Rule 144A under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulation hereafter adopted
by the SEC.

      "SEC" means the Securities and Exchange Commission.

      "SECURITIES ACT" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated by the SEC thereunder.

      "SHELF REGISTRATION STATEMENT" has the meaning set forth in Section 2(a)
hereof.

      "SPECIAL COUNSEL" means Shearman & Sterling or one such other successor
counsel as shall be specified by the Holders of a majority of all Registrable
Securities, but which may, with the written consent of the Initial Purchasers
(which shall not be unreasonably withheld), be another nationally recognized law
firm experienced in securities law matters designated by the Company, the
reasonable fees and expenses of which will be paid by the Company pursuant to
Section 5 hereof. Throughout this Agreement, for purposes of determining the
holders of a majority of Registrable Securities in this definition, Holders of
Notes shall be deemed to be the Holders of the number of shares of Underlying
Common Stock into which such Notes are or would be convertible as of the date
the consent is requested.

      "SUBSEQUENT SHELF REGISTRATION STATEMENT" has the meaning set forth in
Section 2(b) hereof.

      "TIA" means the Trust Indenture Act of 1939, as amended.


                                       4
<PAGE>

      "TRUSTEE" means Fifth Third Bank, the Trustee under the Indenture.

      "UNDERLYING COMMON STOCK" means the Common Stock into which the Notes are
convertible or issued upon any such conversion.

      SECTION 2. Shelf Registration. (a) The Company shall use its reasonable
best efforts to prepare and file or cause to be prepared and filed with the SEC,
as soon as practicable but in any event by the date (the "FILING DEADLINE DATE")
ninety (90) days after the Issue Date, a Registration Statement for an offering
to be made on a delayed or continuous basis pursuant to Rule 415 of the
Securities Act (a "SHELF REGISTRATION STATEMENT") registering the resale from
time to time by Holders thereof of all of the Registrable Securities (the
"INITIAL SHELF REGISTRATION STATEMENT"). The Initial Shelf Registration
Statement shall be on Form S-3 or another appropriate form permitting
registration of such Registrable Securities for resale by such Holders in
accordance with the methods of distribution elected by the Holders and set forth
in the Initial Shelf Registration Statement. The Company shall use its
reasonable best efforts to cause the Initial Shelf Registration Statement to be
declared effective under the Securities Act as promptly as is practicable but in
any event by the date (the "EFFECTIVENESS DEADLINE DATE") that is one hundred
eighty (180) days after the Issue Date, and to keep the Initial Shelf
Registration Statement (or any Subsequent Shelf Registration Statement)
continuously effective under the Securities Act until the expiration of the
Effectiveness Period. At the time the Initial Shelf Registration Statement is
declared effective, each Holder that became a Notice Holder on or prior to the
date ten (10) Business Days prior to such time of effectiveness shall be named
as a selling securityholder in the Initial Shelf Registration Statement and the
related Prospectus in such a manner as to permit such Holder to deliver such
Prospectus to purchasers of Registrable Securities in accordance with applicable
law. None of the Company's security holders (other than the Holders of
Registrable Securities) shall have the right to include any of the Company's
securities in the Shelf Registration Statement.

      (b) If the Initial Shelf Registration Statement or any Subsequent Shelf
Registration Statement ceases to be effective for any reason at any time during
the Effectiveness Period (other than because all Registrable Securities
registered thereunder shall have been resold pursuant thereto or shall have
otherwise ceased to be Registrable Securities), the Company shall use its
reasonable best efforts to obtain the prompt withdrawal of any order suspending
the effectiveness thereof, and in any event shall within thirty (30) days of
such cessation of effectiveness amend the Shelf Registration Statement in a
manner reasonably expected to obtain the withdrawal of the order suspending the
effectiveness thereof, or file an additional Shelf Registration Statement
covering all of the securities that as of the date of such filing are
Registrable Securities (a "SUBSEQUENT SHELF REGISTRATION STATEMENT"). If a
Subsequent Shelf Registration Statement is filed, the Company shall use its
reasonable best efforts to cause the Subsequent Shelf Registration Statement to
become effective as promptly as is practicable after such filing and to keep
such Registration Statement (or subsequent Shelf Registration Statement)
continuously effective until the end of the Effectiveness Period.

      (c) The Company shall supplement and amend the Shelf Registration
Statement if required by the rules, regulations or instructions applicable to
the registration form used by the Company for such Shelf Registration Statement,
if required by the Securities Act or as necessary to name a Notice Holder as a
selling securityholder pursuant to Section (d) below.


                                       5
<PAGE>

      (d) Each Holder agrees that if such Holder wishes to sell Registrable
Securities pursuant to a Shelf Registration Statement and related Prospectus, it
will do so only in accordance with this Section 2(d) and Section 3(h). Following
the date that the Initial Shelf Registration Statement is declared effective,
each Holder wishing to sell Registrable Securities pursuant to a Shelf
Registration Statement and related Prospectus agrees to deliver a Notice and
Questionnaire to the Company at least three (3) Business Days prior to any
intended distribution of Registrable Securities under the Shelf Registration
Statement. Each holder who elects to sell Registrable Securities pursuant to a
Shelf Registration Statement agrees, by submitting a Notice and Questionnaire to
the Company, it will be bound by the terms and conditions of the Notice and
Questionnaire and this Agreement. From and after the date the Initial Shelf
Registration Statement is declared effective, the Company shall, as promptly as
practicable after the date a Notice and Questionnaire is delivered pursuant to
Section 8(c) hereof, and in any event upon the later of (x) fifteen (15)
Business Days after such date or (y) fifteen (15) Business Days after the
expiration of any Deferral Period in effect when the Notice and Questionnaire is
delivered or put into effect within fifteen (15) Business Days of such delivery
date:

            (i) if required by applicable law, file with the SEC a
      post-effective amendment to the Shelf Registration Statement or prepare
      and, if required by applicable law, file a supplement to the related
      Prospectus or a supplement or amendment to any document incorporated
      therein by reference or file any other required document so that the
      Holder delivering such Notice and Questionnaire is named as a selling
      securityholder in the Shelf Registration Statement and the related
      Prospectus in such a manner as to permit such Holder to deliver such
      Prospectus to purchasers of the Registrable Securities in accordance with
      applicable law and, if the Company shall file a post-effective amendment
      to the Shelf Registration Statement, use its reasonable best efforts to
      cause such post-effective amendment to be declared effective under the
      Securities Act as promptly as is practicable, but in any event by the date
      (the "AMENDMENT EFFECTIVENESS DEADLINE DATE") that is forty-five (45) days
      after the date such post-effective amendment is required by this clause to
      be filed;

            (ii) provide such Holder copies of any documents filed pursuant to
      Section 2(d)(i); and

            (iii) notify such Holder as promptly as practicable after the
      effectiveness under the Securities Act of any post-effective amendment
      filed pursuant to Section 2(d)(i);

provided, that if such Notice and Questionnaire is delivered during a Deferral
Period, the Company shall so inform the Holder delivering such Notice and
Questionnaire and shall take the actions set forth in clauses (i), (ii) and
(iii) above upon expiration of the Deferral Period in accordance with Section
3(h). Notwithstanding anything contained herein to the contrary, (i) the Company
shall be under no obligation to name any Holder that is not a Notice Holder as a
selling securityholder in any Registration Statement or related Prospectus and
(ii) the Amendment Effectiveness Deadline Date shall be extended by up to ten
(10) Business Days from the expiration of a Deferral Period (and the Company
shall incur no obligation to pay Liquidated Damages during such extension or
during such Deferral Period) if such Deferral Period shall be in effect on the
Amendment Effectiveness Deadline Date.


                                       6
<PAGE>

      (e) The parties hereto agree that the Holders of Registrable Securities
will suffer damages, and that it would not be feasible to ascertain the extent
of such damages with precision, if, other than as permitted hereunder,

            (i) the Initial Shelf Registration Statement has not been filed on
      or prior to the Filing Deadline Date,

            (ii) the Initial Shelf Registration Statement has not been declared
      effective under the Securities Act on or prior to the Effectiveness
      Deadline Date,

            (iii) the Company has failed to perform its obligations set forth in
      Section 2(d)(i) within the time period required therein,

            (iv) any post-effective amendment to a Shelf Registration Statement
      filed pursuant to Section 2(d)(i) has not become effective under the
      Securities Act on or prior to the Amendment Effectiveness Deadline Date,
      or

            (v) the aggregate duration of Deferral Periods in any period exceeds
      the number of days permitted in respect of such period pursuant to Section
      3(h) hereof.

Each event described in any of the foregoing clauses (i) through (v) is
individually referred to herein as an "EVENT." For purposes of this Agreement,
each Event set forth above shall begin and end on the dates set forth in the
table set forth below:

<TABLE>
<CAPTION>
       Type of
       Event by                   Beginning                          Ending
        Clause                      Date                              Date
        ------                      ----                              ----
<S>                      <C>                                <C>
         (i)             Filing Deadline Date               the date the Initial Shelf
                                                            Registration Statement is
                                                            filed

        (ii)             Effectiveness Deadline Date        the date the Initial Shelf
                                                            Registration Statement becomes
                                                            effective under the Securities
                                                            Act

       (iii)             the date by which the              the date the Company performs
                         Company is required to             its obligations set forth in
                         perform its obligations under      Section 2(d)
                         Section 2(d)
</TABLE>

                                       7
<PAGE>

<TABLE>
<CAPTION>
       Type of
       Event by                   Beginning                          Ending
        Clause                      Date                              Date
        ------                      ----                              ----
<S>                      <C>                                <C>
        (iv)             the Amendment Effectiveness        the date the applicable
                         Deadline Date                      post-effective amendment to a
                                                            Shelf Registration Statement
                                                            becomes effective under the
                                                            Securities Act

         (v)             the date on which the              termination of the Deferral
                         aggregate duration of Deferral     Period that caused the limit
                         Periods in any period exceeds      on the aggregate duration of
                         the number of days                 Deferral Periods to be
                         permitted by Section 3(h)          exceeded
</TABLE>

For purposes of this Agreement, Events shall begin on the dates set forth in the
table above and shall continue until the ending dates set forth in the table
above.

      Commencing on (and including) any date that an Event has begun and ending
on (but excluding) the next date on which there are no Events that have occurred
and are continuing (a "DAMAGES ACCRUAL PERIOD"), the Company shall pay, as
liquidated damages and not as a penalty, to Record Holders of Registrable
Securities an amount (the "LIQUIDATED DAMAGES AMOUNT") accruing, for each day in
the Damages Accrual Period, (i) in respect of any Note, at a rate per annum
equal to 0.5% of the aggregate principal amount of the Notes outstanding until
the Registration Statement is filed or made effective or during the additional
period the Prospectus is unavailable and (ii) in respect of each share of
Underlying Common Stock at a rate per annum equal to 0.5% of the Conversion
Price on such date, as the case may be; provided that in the case of a Damages
Accrual Period that is in effect solely as a result of an Event of the type
described in clause (iii) or (iv) of the preceding paragraph, such Liquidated
Damages Amount shall be paid only to the Holders (as set forth in the succeeding
paragraph) that have delivered Notices and Questionnaires that caused the
Company to incur the obligations set forth in Section 2(d) the non-performance
of which is the basis of such Event. In calculating the Liquidated Damages
Amount on any date on which no Notes are outstanding, the Conversion Price and
the Liquidated Damages Amount payable with respect to shares of Common Stock
which are Registrable Securities, shall be calculated as if the Notes were still
outstanding. Notwithstanding the foregoing, no Liquidated Damages Amount shall
accrue as to any Registrable Security from and after the earlier of (x) the date
such security is no longer a Registrable Security and (y) expiration of the
Effectiveness Period. The rate of accrual of the Liquidated Damages Amount with
respect to any period shall not exceed the rate provided for in this paragraph
notwithstanding the occurrence of multiple concurrent Events.

      The Liquidated Damages Amount shall accrue from the first day of the
applicable Damages Accrual Period, and shall be payable on each Damages Payment
Date during the Damage Accrual Period (and on the Damages Payment Date next
succeeding the end of the Damages Accrual Period if the Damage Accrual Period
does not end on a Damages Payment


                                       8
<PAGE>

Date) to the Record Holders of the Registrable Securities entitled thereto;
provided that any Liquidated Damages Amount accrued with respect to any Note or
portion thereof redeemed by the Company on a redemption date or converted into
Underlying Common Stock on a conversion date prior to the Damages Payment Date,
shall, in any such event, be paid instead to the Holder who submitted such Note
or portion thereof for redemption or conversion on the applicable redemption
date or conversion date, as the case may be, on such date (or promptly following
the conversion date, in the case of conversion); provided further that, in the
case of an Event of the type described in clause (iii) or (iv) of the first
paragraph of this Section 2(e), such Liquidated Damages Amount shall be paid
only to the Holders entitled thereto pursuant to such first paragraph by check
mailed to the address set forth in the Notice and Questionnaire delivered by
such Holder. The Trustee shall be entitled, on behalf of registered holders of
Notes or Underlying Common Stock, to seek any available remedy for the
enforcement of this Agreement, including for the payment of such Liquidated
Damages Amount. Notwithstanding the foregoing, the parties agree that the sole
damages payable for a violation of the terms of this Agreement with respect to
which liquidated damages are expressly provided shall be such liquidated
damages. Nothing shall preclude any Holder from pursuing or obtaining specific
performance or other equitable relief with respect to this Agreement.

      All of the Company's obligations set forth in this Section 2(e) that are
outstanding with respect to any Registrable Security at the time such security
ceases to be a Registrable Security shall survive until such time as all such
obligations with respect to such security have been satisfied in full
(notwithstanding termination of this Agreement pursuant to Section 8(k)).

      The parties hereto agree that the liquidated damages provided for in this
Section 2(e) constitute a reasonable estimate of the damages that may be
incurred by Holders of Registrable Securities by reason of the failure of the
Shelf Registration Statement to be filed or declared effective or available for
effecting resales of Registrable Securities in accordance with the provisions
hereof.

      SECTION 3. Registration Procedures. In connection with the registration
obligations of the Company under Section 2 hereof, during the Effectiveness
Period, the Company shall:

            (a) Prepare and file with the SEC a Registration Statement or
      Registration Statements on any appropriate form under the Securities Act
      available for the sale of the Registrable Securities by the Holders
      thereof in accordance with the intended method or methods of distribution
      thereof, and use its reasonable best efforts to cause each such
      Registration Statement to become effective and remain effective as
      provided herein; provided that before filing any Registration Statement or
      Prospectus or any amendments or supplements thereto with the SEC (but
      excluding reports filed with the SEC under the Exchange Act), furnish to
      the Initial Purchasers and the Special Counsel of such offering, if any,
      copies of all such documents proposed to be filed at least three (3)
      Business Days prior to the filing of such Registration Statement or
      amendment thereto or Prospectus or supplement thereto.

            (b) Subject to Section 3(h), prepare and file with the SEC such
      amendments and post-effective amendments to each Registration Statement as
      may be necessary to keep such Registration Statement continuously
      effective for the applicable period


                                       9
<PAGE>

      specified in Section 2(a); cause the related Prospectus to be supplemented
      by any required prospectus supplement, and as so supplemented to be filed
      pursuant to Rule 424 (or any similar provisions then in force) under the
      Securities Act; and use its reasonable best efforts to comply with the
      provisions of the Securities Act applicable to it with respect to the
      disposition of all securities covered by such Registration Statement
      during the Effectiveness Period in accordance with the intended methods of
      disposition by the sellers thereof set forth in such Registration
      Statement as so amended or such Prospectus as so supplemented.

            (c) As promptly as practicable give notice to the Notice Holders,
      the Initial Purchasers and the Special Counsel, (i) when any Prospectus,
      prospectus supplement, Registration Statement or post-effective amendment
      to a Registration Statement has been filed with the SEC and, with respect
      to a Registration Statement or any post-effective amendment, when the same
      has been declared effective, (ii) of any request, following the
      effectiveness of the Initial Shelf Registration Statement under the
      Securities Act, by the SEC or any other federal or state governmental
      authority for amendments or supplements to any Registration Statement or
      related Prospectus or for additional information relating to the Shelf
      Registration Statement, (iii) of the issuance by the SEC or any other
      federal or state governmental authority of any stop order suspending the
      effectiveness of any Registration Statement or the initiation or
      threatening of any proceedings for that purpose, (iv) of the receipt by
      the Company of any notification with respect to the suspension of the
      qualification or exemption from qualification of any of the Registrable
      Securities for sale in any jurisdiction or the initiation or threatening
      of any proceeding for such purpose, (v) of the occurrence of, but not the
      nature of or details concerning, a Material Event and (vi) of the
      determination by the Company that a post-effective amendment to a
      Registration Statement will be filed with the SEC, which notice may, at
      the discretion of the Company (or as required pursuant to Section 3(h)),
      state that it constitutes a Deferral Notice, in which event the provisions
      of Section 3(h) shall apply.

            (d) Use its reasonable best efforts to obtain the withdrawal of any
      order suspending the effectiveness of a Registration Statement or the
      lifting of any suspension of the qualification (or exemption from
      qualification) of any of the Registrable Securities for sale in any
      jurisdiction in which they have been qualified for sale, in either case at
      the earliest possible moment, and provide immediate notice to each Notice
      Holder and the Initial Purchaser of the withdrawal of any such order.

            (e) As promptly as practicable furnish to each Notice Holder, the
      Special Counsel and the Initial Purchaser, upon request and without
      charge, at least one (1) conformed copy of the Registration Statement and
      any amendment thereto, including exhibits and if requested, all documents
      incorporated or deemed to be incorporated therein by reference.

            (f) Deliver to each Notice Holder, the Special Counsel, if any, and
      the Initial Purchaser, in connection with any sale of Registrable
      Securities pursuant to a Registration Statement, without charge, as many
      copies of the Prospectus or Prospectuses relating to such Registrable
      Securities (including each preliminary prospectus) and any amendment or
      supplement thereto as such Notice Holder may reasonably request; and the


                                       10
<PAGE>

      Company hereby consents (except during such periods that a Deferral Notice
      is outstanding and has not been revoked) to the use of such Prospectus or
      each amendment or supplement thereto by each Notice Holder in connection
      with any offering and sale of the Registrable Securities covered by such
      Prospectus or any amendment or supplement thereto in the manner set forth
      therein.

            (g) Prior to any public offering of the Registrable Securities
      pursuant to a Registration Statement, use its reasonable best efforts to
      register or qualify or cooperate with the Notice Holders and the Special
      Counsel in connection with the registration or qualification (or exemption
      from such registration or qualification) of such Registrable Securities
      for offer and sale under the securities or Blue Sky laws of such
      jurisdictions within the United States as any Notice Holder reasonably
      requests in writing (which request may be included in the Notice and
      Questionnaire); prior to any public offering of the Registrable Securities
      pursuant to the Shelf Registration Statement, use its reasonable best
      efforts to keep each such registration or qualification (or exemption
      therefrom) effective during the Effectiveness Period in connection with
      such Notice Holder's offer and sale of Registrable Securities pursuant to
      such registration or qualification (or exemption therefrom) and do any and
      all other acts or things reasonably necessary or advisable to enable the
      disposition in such jurisdictions of such Registrable Securities in the
      manner set forth in the relevant Registration Statement and the related
      Prospectus; provided that the Company will not be required to (i) qualify
      as a foreign corporation or as a dealer in securities in any jurisdiction
      where it would not otherwise be required to qualify but for this Agreement
      or (ii) take any action that would subject it to general service of
      process in suits or to taxation in any such jurisdiction where it is not
      then so subject.

            (h) Upon (A) the issuance by the SEC of a stop order suspending the
      effectiveness of the Shelf Registration Statement or the initiation of
      proceedings with respect to the Shelf Registration Statement under Section
      8(d) or 8(e) of the Securities Act, (B) the occurrence of any event or the
      existence of any fact (a "MATERIAL EVENT") as a result of which any
      Registration Statement shall contain any untrue statement of a material
      fact or omit to state any material fact required to be stated therein or
      necessary to make the statements therein not misleading, or any Prospectus
      shall contain any untrue statement of a material fact or omit to state any
      material fact required to be stated therein or necessary to make the
      statements therein, in the light of the circumstances under which they
      were made, not misleading, or (C) the occurrence or existence of any
      pending corporate development that, in the reasonable discretion of the
      Company, makes it appropriate to suspend the availability of the Shelf
      Registration Statement and the related Prospectus:

                  (i) in the case of clause (B) above, subject to the next
            sentence, as promptly as practicable prepare and file, if necessary
            pursuant to applicable law, a post-effective amendment to such
            Registration Statement or a supplement to the related Prospectus or
            any document incorporated therein by reference or file any other
            required document that would be incorporated by reference into such
            Registration Statement and Prospectus so that such Registration
            Statement does not contain any untrue statement of a material fact
            or omit to state any material fact required to be stated therein or
            necessary to make the statements therein not misleading, and such
            Prospectus does not contain any untrue statement of a material fact
            or omit to state any material


                                       11
<PAGE>

            fact required to be stated therein or necessary to make the
            statements therein, in the light of the circumstances under which
            they were made, not misleading, as thereafter delivered to the
            purchasers of the Registrable Securities being sold thereunder, and,
            in the case of a post-effective amendment to a Registration
            Statement, subject to the next sentence, use its reasonable best
            efforts to cause it to be declared effective as promptly as is
            practicable, and

                  (ii) give notice to the Notice Holders, and the Special
            Counsel, if any, that the availability of the Shelf Registration
            Statement is suspended (a "DEFERRAL NOTICE") and, upon receipt of
            any Deferral Notice, each Notice Holder agrees not to sell any
            Registrable Securities pursuant to the Registration Statement until
            such Notice Holder's receipt of copies of the supplemented or
            amended Prospectus provided for in clause (i) above, or until it is
            advised in writing by the Company that the Prospectus may be used,
            and has received copies of any additional or supplemental filings
            that are incorporated or deemed incorporated by reference in such
            Prospectus.

The Company will use its reasonable best efforts to ensure that the use of the
Prospectus may be resumed (x) in the case of clause (A) above, as promptly as is
practicable, (y) in the case of clause (B) above, as soon as, in the sole
judgment of the Company, public disclosure of such Material Event would not be
prejudicial to or contrary to the interests of the Company or, if necessary to
avoid unreasonable burden or expense, as soon as practicable thereafter and (z)
in the case of clause (C) above, as soon as in the reasonable discretion of the
Company, such suspension is no longer appropriate. The Company shall be entitled
to exercise its right under this Section 3(h) to suspend the availability of the
Shelf Registration Statement or any Prospectus, without incurring or accruing
any obligation to pay liquidated damages pursuant to Section 2(e) (the "DEFERRAL
PERIOD"); provided that the aggregate duration of any Deferral Periods shall not
exceed 30 days in any three month period (or 60 days in any three month period
in the event of a Material Event pursuant to which the Company has delivered a
second notice as required below) or 90 days in any twelve (12) month period;
provided that in the case of a Material Event relating to an acquisition or a
probable acquisition or financing, recapitalization, business combination or
other similar transaction, the Company may, without incurring any obligation to
pay liquidated damages pursuant to Section 2(e), deliver to Notice Holders a
second notice to the effect set forth above, which shall have the effect of
extending the Deferral Period by up to an additional 30 days, or such shorter
period of time as is specified in such second notice.

            (i) If reasonably requested in writing in connection with a
      disposition of Registrable Securities pursuant to a Registration
      Statement, make reasonably available for inspection during normal business
      hours by a representative for the Notice Holders of such Registrable
      Securities, any broker-dealers, underwriters, attorneys and accountants
      retained by such Notice Holders, and any attorneys or other agents
      retained by a broker-dealer or underwriter engaged by such Notice Holders,
      all relevant financial and other records and pertinent corporate documents
      and properties of the Company and its


                                       12
<PAGE>

      subsidiaries, and cause the appropriate officers, directors and employees
      of the Company and its subsidiaries to make reasonably available for
      inspection during normal business hours on reasonable notice all relevant
      information reasonably requested by such representative for the Notice
      Holders, or any such broker-dealers, underwriters, attorneys or
      accountants in connection with such disposition, in each case as is
      customary for similar "due diligence" examinations; provided that such
      persons shall first agree in writing with the Company that any information
      that is reasonably designated by the Company as confidential at the time
      of delivery of such information shall be kept confidential by such persons
      and shall be used solely for the purposes of exercising rights under this
      Agreement, unless (i) disclosure of such information is required by court
      or administrative order or is necessary to respond to inquiries of
      regulatory authorities, (ii) disclosure of such information is required by
      law (including any disclosure requirements pursuant to federal securities
      laws in connection with the filing of any Registration Statement or the
      use of any prospectus referred to in this Agreement), (iii) such
      information becomes generally available to the public other than as a
      result of a disclosure or failure to safeguard by any such person or (iv)
      such information becomes available to any such person from a source other
      than the Company and such source is not bound by a confidentiality
      agreement, and provided further that the foregoing inspection and
      information gathering shall, to the greatest extent possible, be
      coordinated on behalf of all the Notice Holders and the other parties
      entitled thereto by the counsel referred to in Section 5. Any person
      legally compelled to disclose any such confidential information made
      available for inspection shall provide the Company with prompt prior
      written notice of such requirement so that the Company may seek a
      protective order or other appropriate remedy.

            (j) Comply with all applicable rules and regulations of the SEC and
      make generally available to its securityholders earning statements (which
      need not be audited) satisfying the provisions of Section 11(a) of the
      Securities Act and Rule 158 thereunder (or any similar rule promulgated
      under the Securities Act) for a 12-month period commencing on the first
      day of the first fiscal quarter of the Company commencing after the
      effective date of a Registration Statement, which statements shall be made
      available no later than 45 days after the end of the 12-month period or 90
      days if the 12-month period coincides with the fiscal year of the Company.

            (k) Cooperate with each Notice Holder to facilitate the timely
      preparation and delivery of certificates representing Registrable
      Securities sold or to be sold pursuant to a Registration Statement, which
      certificates shall not bear any restrictive legends, and cause such
      Registrable Securities to be in such denominations as are permitted by the
      Indenture and registered in such names as such Notice Holder may request
      in writing at least two (2) Business Day prior to any sale of such
      Registrable Securities.

            (l) Provide a CUSIP number for all Registrable Securities covered by
      each Registration Statement not later than the effective date of such
      Registration Statement and provide the Trustee and the transfer agent for
      the Common Stock with printed certificates for the Registrable Securities
      that are in a form eligible for deposit with The Depository Trust Company.


                                       13
<PAGE>

            (m) Cooperate and assist in any filings required to be made with the
      National Association of Securities Dealers, Inc.

            (n) In the case of a Shelf Registration Statement involving an
      underwritten offering, the Company shall enter into such customary
      agreements (including, if requested, an underwriting agreement in
      customary form) and take all such other action, if any, as Holders of a
      majority of the Registrable Securities being sold or any managing
      underwriters shall reasonably request in order to facilitate any
      disposition of Notes and Underlying Common Stock pursuant to such Shelf
      Registration Statement, including, without limitation, (i) using its
      reasonable efforts to cause its counsel to deliver an opinion or opinions
      in customary form, (ii) using its reasonable efforts to cause its officers
      to execute and deliver all customary documents and certificates and (iii)
      using its reasonable efforts to cause its independent public accountants
      to provide a comfort letter or letters in customary form.

            (o) Upon (i) the filing of the Initial Shelf Registration Statement
      and (ii) the effectiveness of the Initial Shelf Registration Statement,
      announce the same, in each case by release to Reuters Economic Services
      and Bloomberg Business News.

      SECTION 4. Holder's Obligations. Each Holder agrees, by acquisition of the
Registrable Securities, that no Holder shall be entitled to sell any of such
Registrable Securities pursuant to a Registration Statement or to receive a
Prospectus relating thereto, unless such Holder has furnished the Company with a
Notice and Questionnaire as required pursuant to Section 2(d) hereof (including
the information required to be included in such Notice and Questionnaire) and
the information set forth in the next sentence. Each Notice Holder agrees
promptly to furnish to the Company all information required to be disclosed in
order to make the information previously furnished to the Company by such Notice
Holder not misleading and any other information regarding such Notice Holder and
the distribution of such Registrable Securities as the Company may from time to
time reasonably request. Any sale of any Registrable Securities by any Holder
shall constitute a representation and warranty by such Holder that the
information relating to such Holder and its plan of distribution is as set forth
in the Prospectus delivered by such Holder in connection with such disposition,
that such Prospectus does not as of the time of such sale contain any untrue
statement of a material fact relating to or provided by such Holder or its plan
of distribution and that such Prospectus does not as of the time of such sale
omit to state any material fact relating to or provided by such Holder or its
plan of distribution necessary to make the statements in such Prospectus, in the
light of the circumstances under which they were made, not misleading.

      SECTION 5. Registration Expenses. The Company shall bear all fees and
expenses incurred in connection with the performance by the Company of its
obligations under Sections 2 and 3 of this Agreement whether or not any
Registration Statement is declared effective. Such fees and expenses shall
include, without limitation, (i) all registration and filing fees (including,
without limitation, fees and expenses (x) with respect to filings required to be
made with the National Association of Securities Dealers, Inc. and (y) of
compliance with federal and state securities or Blue Sky laws (including,
without limitation, reasonable fees and disbursements of the Special Counsel in
connection with Blue Sky qualifications of the Registrable Securities under the
laws of such jurisdictions as Notice Holders of a majority of the Registrable
Securities


                                       14
<PAGE>

being sold pursuant to a Registration Statement may designate), (ii) printing
expenses (including, without limitation, expenses of printing certificates for
Registrable Securities in a form eligible for deposit with The Depository Trust
Company), (iii) duplication expenses relating to copies of any Registration
Statement or Prospectus delivered to any Holders hereunder, (iv) fees and
disbursements of counsel for the Company in connection with the Shelf
Registration Statement, (v) reasonable fees and disbursements of the Trustee and
its counsel and of the registrar and transfer agent for the Common Stock and
(vi) any Securities Act liability insurance obtained by the Company in its sole
discretion. In addition, the Company shall pay the internal expenses of the
Company (including, without limitation, all salaries and expenses of officers
and employees performing legal or accounting duties), the expense of any annual
audit, the fees and expenses incurred in connection with the listing by the
Company of the Registrable Securities on any securities exchange on which
similar securities of the Company are then listed and the fees and expenses of
any person, including special experts, retained by the Company. Notwithstanding
the provisions of this Section 5, each seller of Registrable Securities shall
pay selling expenses, including any underwriting discount and commissions, and
all registration expenses to the extent required by applicable law.

      SECTION 6. Indemnification and Contribution.

      (a) Indemnification by the Company. The Company agrees to indemnify and
hold harmless each Notice Holder, each person, if any, who controls any Notice
Holder within the meaning of either Section 15 of the Securities Act or Section
20 of the Exchange Act, from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement or any amendment thereof,
any preliminary prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), caused by
any omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages or liabilities are caused by any
such untrue statement or omission or alleged untrue statement or omission based
upon information relating to any Holder furnished to the Company in writing by
such Holder expressly for use therein; provided that the indemnification
contained in this paragraph shall not inure to the benefit of any Holder (or to
the benefit of any person controlling such Holder) on account of any such
losses, claims, damages or liabilities caused by any untrue statement or alleged
untrue statement or omission or alleged omission made in any preliminary
prospectus provided in each case the Company has performed its obligations under
Section 3(a) hereof if either (A) (i) such Holder failed to send or deliver a
copy of the Prospectus with or prior to the delivery of written confirmation of
the sale by such Holder to the person asserting the claim from which such
losses, claims, damages or liabilities arise and (ii) the Prospectus would have
corrected such untrue statement or alleged untrue statement or such omission or
alleged omission, or (B) (x) such untrue statement or alleged untrue statement,
omission or alleged omission is corrected in an amendment or supplement to the
Prospectus and (y) having previously been furnished by or on behalf of the
Company with copies of the Prospectus as so amended or supplemented, such Holder
thereafter fails to deliver such Prospectus as so amended or supplemented, with
or prior to the delivery of written confirmation of the sale of a Registrable
Security to the person asserting the claim from which such losses, claims,
damages or liabilities arise. In connection


                                       15
<PAGE>

with any underwritten offering pursuant to Section 8, the Company will also
indemnify the underwriters, if any, their officers and directors and each person
who controls such underwriters (within the meaning of the Securities Act and the
Exchange Act) to the same extent as provided herein with respect to the
indemnification of the Holders, if requested in connection with any Registration
Statement.

      (b) Indemnification by Holders. Each Holder agrees severally and not
jointly to indemnify and hold harmless the Company and its directors, its
officers and each person, if any, who controls the Company (within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act) or
any other Holder, to the same extent as the foregoing indemnity from the Company
to such Holder, but only with reference to information relating to such Holder
furnished to the Company in writing by such Holder expressly for use in such
Registration Statement or Prospectus or amendment or supplement thereto. In no
event shall the liability of any Holder hereunder be greater in amount than the
dollar amount of the proceeds received by such Holder upon the sale of the
Registrable Securities pursuant to the Registration Statement giving rise to
such indemnification obligation. In connection with any underwritten offering
pursuant to Section 8, each Holder will also indemnify the underwriters, if any,
their officers and directors and each person who controls such underwriters
(within the meaning of the Securities Act and the Exchange Act) to the same
extent as provided herein with respect to the indemnification of the Company, if
requested in connection with any Registration Statement.

      (c) Conduct of Indemnification Proceedings. In case any proceeding
(including any governmental investigation) shall be instituted involving any
person in respect of which indemnity may be sought pursuant to Section 6(a) or
6(b) hereof, such person (the "INDEMNIFIED PARTY") shall promptly notify the
person against whom such indemnity may be sought (the "INDEMNIFYING PARTY") in
writing and the indemnifying party, upon request of the indemnified party, shall
retain counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in such
proceeding and shall pay the reasonable fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any indemnified party shall
have the right to retain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless (i) the
indemnifying party and the indemnified party shall have mutually agreed to the
retention of such counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying party and the
indemnified party and representation of both parties by the same counsel would
be inappropriate due to actual or potential differing interests between them. It
is understood that the indemnifying party shall not, in respect of the legal
expenses of any indemnified party in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed as
they are incurred. Such firm shall be designated in writing by, in the case of
parties indemnified pursuant to Section 6(a), the Holders of a majority (with
Holders of Notes deemed to be the Holders, for purposes of determining such
majority, of the number of shares of Underlying Common Stock into which such
Notes are or would be convertible as of the date on which such designation is
made) of the Registrable Securities covered by the Registration Statement held
by Holders that are indemnified parties pursuant to Section 6(a) and, in the
case of parties indemnified pursuant to Section 6(b), the Company. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled


                                       16
<PAGE>

with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses
of counsel as contemplated by the second and third sentences of this paragraph,
the indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
proceeding.

      (d) Contribution. To the extent that the indemnification provided for in
Section 6(a) or 6(b) is unavailable to an indemnified party or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
each indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party or parties on the other hand or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the indemnifying party or
parties on the one hand and of the indemnified party or parties on the other
hand in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company shall be deemed to
be equal to the total net proceeds from the initial placement pursuant to the
Purchase Agreement (before deducting expenses) of the Registrable Securities to
which such losses, claims, damages or liabilities relate. The relative benefits
received by any Holder shall be deemed to be equal to the value of receiving
Registrable Securities that are registered under the Securities Act. The
relative fault of the Holders on the one hand and the Company on the other hand
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Holders or by
the Company, and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Holders'
respective obligations to contribute pursuant to this paragraph 6 are several in
proportion to the respective number of Registrable Securities they have sold
pursuant to a Registration Statement, and not joint.

      The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 6(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any


                                       17
<PAGE>

such action or claim. Notwithstanding this Section 6, no indemnifying party that
is a selling Holder shall be required to contribute any amount in excess of the
amount by which the total price at which the Registrable Securities sold by it
and distributed to the public were offered to the public exceeds the amount of
any damages that such indemnifying party has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11 (f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.

      (e) The remedies provided for in this Section 6 are not exclusive and
shall not limit any rights or remedies which may otherwise be available to an
indemnified party at law or in equity, hereunder, under the Purchase Agreement
or otherwise.

      (f) The indemnity and contribution provisions contained in this Section 6
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
any Holder, any person controlling any Holder or any affiliate of any Holder or
by or on behalf of the Company, its officers or directors or any person
controlling the Company and (iii) the sale of any Registrable Securities by any
Holder.

      SECTION 7. Information Requirements. The Company covenants that, if at any
time before the end of the Effectiveness Period the Company is not subject to
the reporting requirements of the Exchange Act, it will cooperate with any
Holder and take such further reasonable action as any Holder may reasonably
request in writing (including, without limitation, making such reasonable
representations as any such Holder may reasonably request), all to the extent
required from time to time to enable such Holder to sell Registrable Securities
without registration under the Securities Act within the limitation of the
exemptions provided by Rule 144 and Rule 144A under the Securities Act and
customarily taken in connection with sales pursuant to such exemptions. Upon the
written request of any Holder, the Company shall deliver to such Holder a
written statement as to whether it has complied with such filing requirements,
unless such a statement has been included in the Company's most recent report
filed pursuant to Section 13 or Section 15(d) of Exchange Act. Notwithstanding
the foregoing, nothing in this Section 7 shall be deemed to require the Company
to register any of its securities (other than the Common Stock) under any
section of the Exchange Act.

      SECTION 8. Underwritten Registrations. The Holders of Registrable
Securities covered by a Shelf Registration Statement who desire to do so may
sell such Registrable Securities to an underwriter in an underwritten offering
for reoffering to the public. If any of the Registrable Securities covered by
any Shelf Registration Statement are to be sold in an underwritten offering, the
investment banker or investment bankers and manager or managers that will
administer the offering will be selected by the Holders of a majority of such
Registrable Securities included in such offering, subject to the consent of the
Company (which shall not be unreasonably withheld or delayed), and such Holders
shall be responsible for all underwriting commissions and discounts and any
transfer taxes in connection therewith. No person may participate in any
underwritten registration hereunder unless such person (i) agrees to sell such
person's Registrable Securities on the basis reasonably provided in any
underwriting arrangements approved by the persons entitled hereunder to approve
such arrangements and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting


                                       18
<PAGE>

agreements and other documents reasonably required under the terms of such
underwriting arrangements.

      SECTION 9. Miscellaneous.

      (a) No Conflicting Agreements. The Company is not, as of the date hereof,
a party to, nor shall it, on or after the date of this Agreement, enter into,
any agreement with respect to its securities that conflicts with the rights
granted to the Holders in this Agreement. The Company represents and warrants
that the rights granted to the Holders hereunder do not in any way conflict with
the rights granted to the holders of the Company's securities under any other
agreements.

      (b) Amendments and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given, unless the Company has obtained the written consent of Holders of a
majority of the then outstanding Underlying Common Stock constituting
Registrable Securities (with Holders of Notes deemed to be the Holders, for
purposes of this Section, of the number of outstanding shares of Underlying
Common Stock into which such Notes are or would be convertible as of the date on
which such consent is requested). Notwithstanding the foregoing, a waiver or
consent to depart from the provisions hereof with respect to a matter that
relates exclusively to the rights of Holders whose securities are being sold
pursuant to a Registration Statement and that does not directly or indirectly
affect the rights of other Holders may be given by Holders of at least a
majority of the Registrable Securities being sold by such Holders pursuant to
such Registration Statement; provided that the provisions of this sentence may
not be amended, modified or supplemented except in accordance with the
provisions of the immediately preceding sentence. Notwithstanding the foregoing
sentence, (i) this Agreement may be amended by written agreement signed by the
Company and the Initial Purchasers, without the consent of the Holders of
Registrable Securities, to cure any ambiguity or to correct or supplement any
provision contained herein that may be defective or inconsistent with any other
provision contained herein, or to make such other provisions in regard to
matters or questions arising under this Agreement that shall not adversely
affect the interests of the Holders of Registrable Securities. Each Holder of
Registrable Securities outstanding at the time of any such amendment,
modification, supplement, waiver or consent or thereafter shall be bound by any
such amendment, modification, supplement, waiver or consent effected pursuant to
this Section 8(b), whether or not any notice, writing or marking indicating such
amendment, modification, supplement, waiver or consent appears on the
Registrable Securities or is delivered to such Holder.

      (c) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand delivery, by telecopier, by
courier guaranteeing overnight delivery or by first-class mail, return receipt
requested, and shall be deemed given (i) when made, if made by hand delivery,
(ii) upon confirmation, if made by telecopier, (iii) one (1) Business Day after
being deposited with such courier, if made by overnight courier or (iv) on the
date indicated on the notice of receipt, if made by first-class mail, to the
parties as follows:

            (i) if to a Holder, at the most current address given by such Holder
      to the Company in a Notice and Questionnaire or any amendment thereto;


                                       19
<PAGE>

                              (ii) if to the Company, to:

                                    Steel Dynamics, Inc.
                                    6714 Pointe Inverness Way, Suite 200
                                    Fort Wayne, Indiana  46804
                                    Attention:  Tracy Shellabarger
                                    Telecopy:  (260) 969-3592

                                    and

                                    Barrett & McNagny LLP
                                    215 East Berry Street
                                    Fort Wayne, IN  46802
                                    Attention:  Robert S. Walters
                                    Telecopy No.:  (260) 423-8920

                              (iii) if to the Initial Purchasers, to:

                                    Morgan Stanley & Co. Incorporated
                                    1585 Broadway
                                    New York, New York
                                    Attention:  Equity Capital Markets
                                    Telecopy No.: (212) 761-0538

or to such other address as such person may have furnished to the other persons
identified in this Section 8(c) in writing in accordance herewith.

      (d) Approval of Holders. Whenever the consent or approval of Holders of a
specified percentage of Registrable Securities is required hereunder,
Registrable Securities held by the Company or its affiliates (as such term is
defined in Rule 405 under the Securities Act) (other than the Initial Purchasers
or subsequent Holders if such subsequent Holders are deemed to be such
affiliates solely by reason of their holdings of such Registrable Securities)
shall not be counted in determining whether such consent or approval was given
by the Holders of such required percentage.

      (e) Successors and Assigns. Any person who purchases any Registrable
Securities from the Initial Purchasers shall be deemed, for purposes of this
Agreement, to be an assignee of the Initial Purchasers. This Agreement shall
inure to the benefit of and be binding upon the successors and assigns of each
of the parties and shall inure to the benefit of and be binding upon each Holder
of any Registrable Securities, provided that nothing herein shall be deemed to
permit any assignment, transfer or other disposition of Registrable Securities
in violation of the terms of the Indenture. If any transferee of any Holder
shall acquire Registrable Securities, in any manner, whether by operation of law
or otherwise, such Registrable Securities shall be held subject to all of the
terms of this Agreement, and by taking and holding such Registrable Securities,
such person shall be conclusively deemed to have agreed to be bound by and to
perform all of the terms and provisions of this Agreement and such person shall
be entitled to receive the benefits hereof.


                                       20
<PAGE>

      (f) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be original and all of which taken together
shall constitute one and the same agreement.

      (g) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

      (h) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

      (i) Severability. If any term provision, covenant or restriction of this
Agreement is held to be invalid, illegal, void or unenforceable, the remainder
of the terms, provisions, covenants and restrictions set forth herein shall
remain in full force and effect and shall in no way be affected, impaired or
invalidated thereby, and the parties hereto shall use their best efforts to find
and employ an alternative means to achieve the same or substantially the same
result as that contemplated by such term, provision, covenant or restriction, it
being intended that all of the rights and privileges of the parties shall be
enforceable to the fullest extent permitted by law.

      (j) Entire Agreement. This Agreement is intended by the parties as a final
expression of their agreement and is intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein and the registration rights granted by the
Company with respect to the Registrable Securities. Except as provided in the
Purchase Agreement, there are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein, with respect to
the registration rights granted by the Company with respect to the Registrable
Securities. This Agreement supersedes all prior agreements and undertakings
among the parties with respect to such registration rights. No party hereto
shall have any rights, duties or obligations other than those specifically set
forth in this Agreement.

      (k) Termination. This Agreement and the obligations of the parties
hereunder shall terminate upon the end of the Effectiveness Period, except for
any liabilities or obligations under Section 4, 5 or 6 hereof and the
obligations to make payments of and provide for liquidated damages under Section
2(e) hereof to the extent such damages accrue prior to the end of the
Effectiveness Period, each of which shall remain in effect in accordance with
its terms.


                                       21
<PAGE>

      IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.

                                      STEEL DYNAMICS, INC.



                                      By: /s/ Tracy L. Shellabarger
                                          -------------------------
                                          Name:  Tracy L. Shellabarger
                                          Title: Vice President, Chief Financial
                                                 Officer and Secretary



Confirmed and accepted as of
the date first above written:

MORGAN STANLEY & CO. INCORPORATED
GOLDMAN, SACHS & CO.

By: Morgan Stanley & Co. Incorporated

By: /s/ David P. Sun
    ----------------
    Name: David P. Sun
    Title: Executive Director


                                       22


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.2.A
<SEQUENCE>4
<FILENAME>y84184exv4w2wa.txt
<DESCRIPTION>INDENTURE
<TEXT>
<PAGE>
                                                                  EXECUTION COPY

                                                                  EXHIBIT 4.2(a)
                              STEEL DYNAMICS, INC.

                            FIFTH THIRD BANK, INDIANA
                                   as Trustee

                                    INDENTURE

                                   Dated as of

                                December 23, 2002

                   4% CONVERTIBLE SUBORDINATED NOTES DUE 2012

<PAGE>

<TABLE>
                                TABLE OF CONTENTS

                                                                                                                  PAGE

                                                       ARTICLE 1

                                                      DEFINITIONS

<S>                                                                                                                <C>
Section 1.01. Definitions........................................................................................   1

                                                       ARTICLE 2

                           ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES

Section 2.01. Designation Amount and Issue of Notes..............................................................  10
Section 2.02. Form of Notes......................................................................................  11
Section 2.03. Date and Denomination of Notes; Payments of Interest...............................................  12
Section 2.04. Execution of Notes.................................................................................  13
Section 2.05. Exchange and Registration of Transfer of Notes; Restrictions on Transfer...........................  14
Section 2.06. Mutilated, Destroyed, Lost or Stolen Notes.........................................................  19
Section 2.07. Temporary Notes....................................................................................  20
Section 2.08. Cancellation of Notes..............................................................................  20
Section 2.09. CUSIP Numbers......................................................................................  21

                                                       ARTICLE 3

                                           REDEMPTION AND REPURCHASE OF NOTES

Section 3.01. Redemption of Notes................................................................................  21
Section 3.02. Notice of Optional Redemption; Selection of Notes..................................................  21
Section 3.03. Payment of Notes Called for Redemption by the Company..............................................  23
Section 3.04. Conversion Arrangement on Call for Redemption......................................................  23
Section 3.05. Redemption at Option of Holders upon a Fundamental Change..........................................  24
Section 3.06. Repurchase of Notes by the Company at Option of the Holder.........................................  26
Section 3.07. Company Repurchase Notice..........................................................................  27
Section 3.08. Effect of Repurchase Notice........................................................................  28
Section 3.09. Deposit of Purchase Price..........................................................................  29
Section 3.10. Notes Repurchased in Part..........................................................................  29
Section 3.11. Repayment to the Company...........................................................................  29

                                                       ARTICLE 4

                                                 CONTINGENT INTEREST

Section 4.01. Contingent Interest................................................................................  29
</TABLE>

<PAGE>

<TABLE>
<S>                                                                                                                <C>
Section 4.02. Payment of Contingent Interest.....................................................................  30
Section 4.03. Contingent Interest Notification...................................................................  30

                                                       ARTICLE 5

                                           PARTICULAR COVENANTS OF THE COMPANY

Section 5.01. Payment of Principal, Premium and Interest.........................................................  30
Section 5.02. Maintenance of Office or Agency....................................................................  30
Section 5.03. Appointments to Fill Vacancies in Trustee's Office.................................................  31
Section 5.04. Provisions as to Paying Agent......................................................................  31
Section 5.05. Existence..........................................................................................  32
Section 5.06. Maintenance of Properties..........................................................................  32
Section 5.07. Payment of Taxes and Other Claims..................................................................  32
Section 5.08. Rule 144A Information Requirement..................................................................  32
Section 5.09. Stay, Extension and Usury Laws.....................................................................  33
Section 5.10. Compliance Certificate.............................................................................  33
Section 5.11. Liquidated Damages Notice..........................................................................  33
Section 5.12. Contingent Debt Tax Treatment......................................................................  34
Section 5.13. Calculation of Tax Original Issue Discount.........................................................  35

                                                       ARTICLE 6

                              NOTEHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE

Section 6.01. Noteholders' Lists.................................................................................  35
Section 6.02. Preservation and Disclosure of Lists...............................................................  35
Section 6.03. Reports by Trustee.................................................................................  36
Section 6.04. Reports by Company.................................................................................  36

                                                       ARTICLE 7

                             REMEDIES OF THE TRUSTEE AND NOTEHOLDERS ON AN EVENT OF DEFAULT

Section 7.01. Events of Default..................................................................................  36
Section 7.02. Payments of Notes on Default; Suit Therefor........................................................  38
Section 7.03. Application of Monies Collected by Trustee.........................................................  40
Section 7.04. Proceedings by Noteholder..........................................................................  40
Section 7.05. Proceedings by Trustee.............................................................................  41
Section 7.06. Remedies Cumulative and Continuing.................................................................  41
Section 7.07. Direction of Proceedings and Waiver of Defaults by Majority of Noteholders.........................  41
Section 7.08. Notice of Defaults.................................................................................  42
Section 7.09. Undertaking to Pay Costs...........................................................................  42
</TABLE>

                                       ii
<PAGE>
<TABLE>
<CAPTION>
                                                       ARTICLE 8

                                                      THE TRUSTEE

<S>                                                                                                                <C>
Section 8.01. Duties and Responsibilities of Trustee.............................................................  43
Section 8.02. Reliance on Documents, Opinions, Etc...............................................................  44
Section 8.03. No Responsibility for Recitals, Etc................................................................  45
Section 8.04. Trustee, Paying Agents, Conversion Agents or Registrar May Own Notes...............................  45
Section 8.05. Monies to Be Held in Trust.........................................................................  46
Section 8.06. Compensation and Expenses of Trustee...............................................................  46
Section 8.07. Officers' Certificate as Evidence..................................................................  46
Section 8.08. Conflicting Interests of Trustee...................................................................  47
Section 8.09. Eligibility of Trustee.............................................................................  47
Section 8.10. Resignation or Removal of Trustee..................................................................  47
Section 8.11. Acceptance by Successor Trustee....................................................................  48
Section 8.12. Succession by Merger...............................................................................  49
Section 8.13. Preferential Collection of Claims..................................................................  49

                                                       ARTICLE 9

                                                   THE NOTEHOLDERS

Section 9.01. Action by Noteholders..............................................................................  49
Section 9.02. Proof of Execution by Noteholders..................................................................  50
Section 9.03. Who Are Deemed Absolute Owners.....................................................................  50
Section 9.04. Company-owned Notes Disregarded....................................................................  50
Section 9.05. Revocation of Consents, Future Holders Bound.......................................................  50

                                                       ARTICLE 10

                                                MEETINGS OF NOTEHOLDERS

Section 10.01. Purpose of Meetings...............................................................................  51
Section 10.02. Call of Meetings by Trustee.......................................................................  51
Section 10.03. Call of Meetings by Company or Noteholders........................................................  52
Section 10.04. Qualifications for Voting.........................................................................  52
Section 10.05. Regulations.......................................................................................  52
Section 10.06. Voting............................................................................................  52
Section 10.07. No Delay of Rights by Meeting.....................................................................  53

                                                       ARTICLE 11

                                                SUPPLEMENTAL INDENTURES

Section 11.01. Supplemental Indentures Without Consent of Noteholders............................................  53
Section 11.02. Supplemental Indenture with Consent of Noteholders................................................  54
Section 11.03. Effect of Supplemental Indenture..................................................................  55
</TABLE>


                                      iii
<PAGE>

<TABLE>
<S>                                                                                                                <C>
Section 11.04. Notation on Notes.................................................................................  56
Section 11.05. Evidence of Compliance of Supplemental Indenture to Be Furnished to Trustee.......................  56

                                                       ARTICLE 12

                                   CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE

Section 12.01. Company May Consolidate on Certain Terms..........................................................  56
Section 12.02. Successor to Be Substituted.......................................................................  57
Section 12.03. Opinion of Counsel to Be Given Trustee............................................................  57

                                                       ARTICLE 13

                                        SATISFACTION AND DISCHARGE OF INDENTURE

Section 13.01. Discharge of Indenture............................................................................  57
Section 13.02. Deposited Monies to Be Held in Trust by Trustee...................................................  58
Section 13.03. Paying Agent to Repay Monies Held.................................................................  58
Section 13.04. Return of Unclaimed Monies........................................................................  58
Section 13.05. Reinstatement.....................................................................................  58

                                                       ARTICLE 14

                             IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS

Section 14.01. Indenture and Notes Solely Corporate Obligations..................................................  59

                                                       ARTICLE 15

                                                  CONVERSION OF NOTES

Section 15.01. Right to Convert..................................................................................  59
Section 15.02. Exercise of Conversion Privilege; Issuance of Common Stock on
               Conversion; No Adjustment for Interest or Dividends...............................................  61
Section 15.03. Cash Payments in Lieu of Fractional Shares........................................................  63
Section 15.04. Conversion Rate...................................................................................  63
Section 15.05. Adjustment of Conversion Rate.....................................................................  63
Section 15.06. Effect of Reclassification, Consolidation, Merger or Sale.........................................  71
Section 15.07. Taxes on Shares Issued............................................................................  72
Section 15.08. Reservation of Shares, Shares to Be Fully Paid; Compliance with
               Governmental Requirements; Listing of Common Stock................................................  73
Section 15.09. Responsibility of Trustee.........................................................................  73
Section 15.10. Notice to Holders Prior to Certain Actions........................................................  74
Section 15.11. Future Stockholder Rights Plans...................................................................  75
</TABLE>


                                      iv
<PAGE>

<TABLE>
<CAPTION>
                                                       ARTICLE 16

                                                     SUBORDINATION

<S>                                                                                                                <C>
Section 16.01. Securities Subordinate to Senior Debt.............................................................  75
Section 16.02. No Payments in Certain Circumstances; Payment Over of Proceeds upon Dissolution, Etc..............  75
Section 16.03. Trustee to Effectuate Subordination...............................................................  78
Section 16.04. No Waiver of Subordination Provisions.............................................................  78
Section 16.05. Notice to Trustee.................................................................................  79
Section 16.06. Reliance on Judicial Order of Certificate of Liquidating Agent....................................  79
Section 16.07. Trustee Not Fiduciary for Holders of Senior Debt..................................................  80
Section 16.08. Reliance by Holders of Senior Debt on Subordination Provisions....................................  80
Section 16.09. Rights of Trustee as Holder of Senior Debt; Preservation of Trustee's Rights......................  80
Section 16.10. Article Applicable to Paying Agents...............................................................  80
Section 16.11. Certain Conversions and Repurchases Deemed Payment................................................  80

                                                       ARTICLE 17

                                                MISCELLANEOUS PROVISIONS

Section 17.01. Provisions Binding on Company's Successors........................................................  81
Section 17.02. Official Acts by Successor Corporation............................................................  81
Section 17.03. Addresses for Notices, Etc........................................................................  81
Section 17.04. Governing Law.....................................................................................  82
Section 17.05. Evidence of Compliance with Conditions Precedent, Certificates to Trustee.........................  82
Section 17.06. Legal Holidays....................................................................................  82
Section 17.07. Trust Indenture Act...............................................................................  82
Section 17.08. No Security Interest Created......................................................................  83
Section 17.09. Benefits of Indenture.............................................................................  83
Section 17.10. Table of Contents, Headings, Etc..................................................................  83
Section 17.11. Authenticating Agent..............................................................................  83
Section 17.12. Execution in Counterparts.........................................................................  84
Section 17.13. Severability......................................................................................  84

Annex 1
Exhibit A      Form of Note                                                                                       A-1
</TABLE>


                                       v
<PAGE>
                                    INDENTURE

      INDENTURE dated as of December 23, 2002 between Steel Dynamics, Inc., an
Indiana corporation (hereinafter called the "COMPANY"), having its principal
office at 6714 Pointe Inverness Way, Suite 200, Fort Wayne, Indiana 46804, and
Fifth Third Bank, Indiana, a state banking association, as trustee hereunder
(hereinafter called the "TRUSTEE").

                                   WITNESSETH:

      WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the issue of its 4% Convertible Subordinated Notes Due 2012
(hereinafter called the "NOTES"), in an aggregate principal amount not to exceed
$100,000,000 (or in the event that the Initial Purchasers, as defined herein,
exercise their option under the Purchase Agreement dated December 17, 2002 (the
"NOTE PURCHASE AGREEMENT") among them and the Company to purchase additional
Notes, in an aggregate principal amount not to exceed $125,000,000) and to
provide the terms and conditions upon which the Notes are to be authenticated,
issued and delivered, the Company has duly authorized the execution and delivery
of this Indenture; and

      WHEREAS, the Notes, the certificate of authentication to be borne by the
Notes, a form of assignment, a form of option to elect redemption upon a
fundamental change, a form of repurchase notice and a form of conversion notice
to be borne by the Notes are to be substantially in the forms hereinafter
provided for; and

      WHEREAS, all acts and things necessary to make the Notes, when executed by
the Company and authenticated and delivered by the Trustee or a duly authorized
authenticating agent, as in this Indenture provided, the valid, binding and
legal obligations of the Company, and to constitute this Indenture a valid
agreement according to its terms, have been done and performed, and the
execution of this Indenture and the issue hereunder of the Notes have in all
respects been duly authorized,

      NOW, THEREFORE, THIS INDENTURE WITNESSETH:

      That in order to declare the terms and conditions upon which the Notes
are, and are to be, authenticated, issued and delivered, and in consideration of
the premises and of the purchase and acceptance of the Notes by the holders
thereof, the Company covenants and agrees with the Trustee for the equal and
proportionate benefit of the respective holders from time to time of the Notes
(except as otherwise provided below), as follows:

                                    ARTICLE 1

                                   DEFINITIONS

      Section 1.01. Definitions. The terms defined in this Section 1.01 (except
as herein otherwise expressly provided or unless the context otherwise requires)
for all purposes of this Indenture and of any indenture supplemental hereto
shall have the respective meanings specified in this Section 1.01. All other
terms used in this Indenture that are defined in the Trust Indenture

<PAGE>

Act or which are by reference therein defined in the Securities Act (except as
herein otherwise expressly provided or unless the context otherwise requires)
shall have the meanings assigned to such terms in the Trust Indenture Act and in
the Securities Act as in force at the date of the execution of this Indenture.
The words "HEREIN", "HEREOF", "HEREUNDER" and words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or other
Subdivision. The terms defined in this Article include the plural as well as the
singular.

      "ACCEPTED PURCHASED SHARES" has the meaning specified in Section 15.05(g).

      "ADJUSTMENT EVENT" has the meaning specified in Section 15.05(l).

      "ADMINISTRATIVE AGENT" means the Administrative Agent under the Senior
Credit Facility.

      "AGENT MEMBERS" has the meaning specified in Section 2.05(b).

      "AFFILIATE" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"CONTROL", when used with respect to any specified Person, means the power to
direct or cause the direction of the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise, and the terms "CONTROLLING" and "CONTROLLED" have
meanings correlative to the foregoing.

      "BOARD OF DIRECTORS" means the Board of Directors of the Company or a
committee of such Board duly authorized to act for it hereunder.

      "BUSINESS DAY" means any day except a Saturday, Sunday or legal holiday on
which banking institutions in The City of New York are authorized or obligated
by law, regulation or executive order to close.

      "CAPITALIZED LEASE" means, as applied to any person, any lease of any
property (whether real, personal or mixed) of which the discounted present value
of the rental obligations of such person as lessee, in conformity with GAAP, is
required to be capitalized on the balance sheet of such person.

      "CAPITALIZED LEASE OBLIGATIONS" means the discounted present value of the
rental obligations under a Capitalized Lease.

      "CLOSING SALE PRICE" of the shares of Common Stock on any date means the
closing sale price per share (or, if no closing sale price is reported, the
average of the closing bid and ask prices or, if more than one in either case,
the average of the average closing bid and the average closing ask prices) on
such date as reported in composite transactions for the principal United States
securities exchange on which shares of Common Stock are traded or, if the shares
of Common Stock are not listed on a United States national or regional
securities exchange, as reported by the Nasdaq or by the National Quotation
Bureau Incorporated. In the absence of such quotations, the Company shall be
entitled to determine the Closing Sale Price on the basis it


                                       2
<PAGE>

considers appropriate. The Closing Sale Price shall be determined without
reference to extended or after hours trading.

      "COMMISSION" means the Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act, or, if at any time after
the execution of this Indenture such Commission is not existing and performing
the duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.

      "COMMON STOCK" means any stock of any class of the Company which has no
preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the Company
and which is not subject to redemption by the Company. Subject to the provisions
of Section 15.06, however, shares issuable on conversion of Notes shall include
only shares of the class designated as common stock of the Company at the date
of this Indenture (namely, the Common Stock, par value $0.01) or shares of any
class or classes resulting from any reclassification or reclassifications
thereof and which have no preference in respect of dividends or of amounts
payable in the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company and which are not subject to redemption by the
Company; provided that if at any time there shall be more than one such
resulting class, the shares of each such class then so issuable on conversion
shall be substantially in the proportion which the total number of shares of
such class resulting from all such reclassifications bears to the total number
of shares of all such classes resulting from all such reclassifications.

      "COMPANY" means the corporation named as the "COMPANY" in the first
paragraph of this Indenture, and, subject to the provisions of Article 12 and
Section 15.06, shall include its successors and assigns.

      "COMPANY REPURCHASE NOTICE" has the meaning specified in Section
3.07(b).

      "COMPANY REPURCHASE NOTICE DATE" has the meaning specified in Section
3.07(b).

      "CONTINGENT INTEREST" means interest that accrues and is payable as
provided in Article 4.

      "CONVERSION PRICE" as of any day will equal $1,000 divided by the
Conversion Rate as of such date.

      "CONVERSION RATE" has the meaning specified in Section 15.04.

      "CORPORATE TRUST OFFICE", or other similar term, means the designated
office of the Trustee at which at any particular time its corporate trust
business as it relates to this Indenture shall be administered, which office is,
at the date as of which this Indenture is dated, located at c/o Fifth Third
Bank, Indiana, c/o Computershare Trust Company of New York, Wall Street Plaza,
88 Pine Street, New York, New York 10005.

      "CURRENT MARKET PRICE" has the meaning specified in Section 15.05(h).

      "CUSTODIAN" means Fifth Third Bank, Indiana, as custodian with respect
to the Notes in global form, or any successor entity thereto.


                                       3
<PAGE>

      "DEBT" of any Person means, with respect to any Person at any date of
determination (without duplication):

            (a) all indebtedness of such Person for borrowed money;

            (b) all obligations of such Person evidenced by bonds, debentures,
      notes or other similar instruments;

            (c) all obligations of such Person in respect of bankers'
      acceptances, bank guarantees, letters of credit or other similar
      instruments (including reimbursement obligations with respect thereto, but
      excluding obligations with respect to letters of credit (including trade
      letters of credit and letters of credit in respect of workers'
      compensation, self insurance or banker's acceptance) securing obligations
      (other than obligations described in (a) or (b) above or (e), (f) or (g)
      below)) or accrued expense;

            (d) all obligations of such person to pay the deferred and unpaid
      purchase price of any property or services, except trade payables;

            (e) all Capitalized Lease Obligations;

            (f) all Debt of other persons secured by a Lien on any asset of such
      person, whether or not such Debt is assumed by such person; provided that
      the amount of such Debt shall be the lesser of (A) the fair market value
      of such asset at such date of determination and (B) the amount of such
      Debt;

            (g) all Debt of other persons Guaranteed by such person to the
      extent such Debt is Guaranteed by such person; and

            (h) all obligations of such person under (i) interest rate swap
      agreements, interest rate cap agreements and interest rate collar
      agreements, (ii) foreign exchange contracts and currency swap agreements
      and (iii) other agreements or arrangements entered into in the ordinary
      course of business designed to protect such person against fluctuations in
      interest rates or currency exchange rates;

provided, however, that Debt shall not include current accounts payable or other
accrued current liability arising in the ordinary course of business in
connection with the obtaining of materials or services.

      The amount of any Debt outstanding as of any date shall be (i) the
accreted value thereof, in the case of any Debt issued with original issue
discount and (ii) the principal amount thereof, together with any interest
thereon that is more than 30 days past due, in the case of any other Debt.

      "DEFAULT" means any event that is, or after notice or passage of time,
or both, would be, an Event of Default.

      "DEFAULTED INTEREST" has the meaning specified in Section 2.03.


                                       4
<PAGE>

      "DEPOSITARY" means the clearing agency registered under the Exchange Act
that is designated to act as the Depositary for the Global Notes. The Depository
Trust Company shall be the initial Depositary, until a successor shall have been
appointed and become such pursuant to the applicable provisions of this
Indenture, and thereafter "DEPOSITARY" shall mean or include such successor.

      "DESIGNATED SENIOR DEBT" means (i) any Senior Debt outstanding under
(a) the Senior Credit Facility and (b) the 9 1/2 Senior Notes and (ii) the
Company's obligations under any particular Senior Debt in which the instrument
creating or evidencing the same, or the assumption or guarantee thereof, or
related agreements or documents to which the Company is a party, expressly
provides that such indebtedness shall be "Designated Senior Debt" for purposes
of this Indenture (provided that no Senior Debt except the Senior Credit
Facility may exercise the rights of Designated Senior Debt in respect of a
Payment Blockage Notice pursuant to Section 16.02 in the event of a non-payment
default on Designated Senior Debt without the Company's prior written consent
delivered to the Trustee unless such right is provided for in the applicable
governing instrument or related agreements or documents). If any payment in
respect of Designated Senior Debt is rescinded or must otherwise be returned
upon the insolvency, bankruptcy or reorganization of the Company or otherwise,
the reinstated Debt of the Company arising as a result thereof shall constitute
Designated Senior Debt of the Company effective as of the date of such recission
or return.

      "DETERMINATION DATE" has the meaning specified in Section 15.05(l).

      "EVENT OF DEFAULT" means any event specified in Section 7.01 as an
Event of Default.

      "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder, as in effect from time to
time.

      "EX-DIVIDEND TIME" has the meaning specified in Section 15.01(b).

      "EXPIRATION TIME" has the meaning specified in Section 15.05(f).

      "FAIR MARKET VALUE" has the meaning specified in Section 15.05(h).

      "FUNDAMENTAL CHANGE" means the occurrence of any transaction or event
in connection with which all or substantially all of the Common Stock shall be
exchanged for, converted into or acquired for or constitutes solely the right to
receive consideration (whether by means of an exchange offer, liquidation,
tender offer, consolidation, merger, combination, reclassification,
recapitalization or otherwise) which is not all or substantially all common
stock that is (or, upon consummation of or immediately following such
transaction or event, which will be) listed on a United States national
securities exchange or approved (or, upon consummation of or immediately
following such transaction or event, which will be approved) for quotation on
the Nasdaq National Market or any similar United States system of automated
dissemination of quotations of securities prices.

      "FUNDAMENTAL CHANGE NOTICE" has the meaning specified in Section
3.05(b).


                                       5
<PAGE>

      "FUNDAMENTAL CHANGE EXPIRATION TIME" has the meaning specified in
Section 3.05(b).

      "FUNDAMENTAL CHANGE REDEMPTION DATE" has the meaning specified in Section
3.05(a).

      "GLOBAL NOTE" has the meaning specified in Section 2.02.

      "GUARANTEE" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Debt of any other Person and,
without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such person (1) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt of such other
person (whether arising by virtue of partnership arrangements, or by agreements
to keep-well, to purchase assets, goods, securities or services (unless such
purchase arrangements are on arm's-length terms and are entered into in the
ordinary course of business), to take-or-pay, or to maintain financial statement
conditions or otherwise) or (2) entered into for purposes of assuring in any
other manner the obligee of such Debt of the payment thereof or to protect such
obligee against loss in respect thereof (in whole or in part). The term
"Guarantee" used as a verb has a corresponding meaning.

      "INDENTURE" means this instrument as originally executed or, if amended
or supplemented as herein provided, as so amended or supplemented.

      "INITIAL PURCHASERS" means Morgan Stanley & Co. Incorporated and Goldman,
Sachs & Co.

      "INTEREST" means, when used with reference to the Notes, any interest
payable under the terms of the Notes, including contingent interest, if any, and
Liquidated Damages, if any, payable under the terms of the Registration Rights
Agreement.

      "LIEN" means any pledge, mortgage, lien, security interest,
hypothecation, assignment for security interest or encumbrance of any kind
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any agreement to give a security interest or any Capitalized
Lease).

      "LIQUIDATED DAMAGES" has the meaning specified for "LIQUIDATED DAMAGES
AMOUNT" in Section 2(e) of the Registration Rights Agreement.

      "LIQUIDATED DAMAGES NOTICE" has the meaning specified in Section 5.11.

      "NON-ELECTING SHARE" has the meaning specified in Section 15.06.

      "NOTE" or "NOTES" means any Note or Notes, as the case may be,
authenticated and delivered under this Indenture, including any Global Note.

      "NOTE PURCHASE AGREEMENT" has the meaning ascribed to such term in the
preamble to this Indenture.

      "NOTE REGISTER" has the meaning specified in Section 2.05.


                                       6
<PAGE>

      "NOTE REGISTRAR" has the meaning specified in Section 2.05.

      "NOTEHOLDER" or "HOLDER" as applied to any Note, or other similar terms
(but excluding the term "BENEFICIAL HOLDER"), means any Person in whose name at
the time a particular Note is registered on the Note registrar's books.

      "NOTICE DATE" means the date of mailing of the notice of redemption
pursuant to Section 3.02.

      "OFFER EXPIRATION TIME" has the meaning specified in Section 15.05(g).

      "OFFICERS' CERTIFICATE", when used with respect to the Company, means a
certificate signed by the Chairman of the Board, the Chief Executive Officer,
the President or any Vice President (whether or not designated by a number or
numbers or word or words added before or after the title "VICE PRESIDENT"), the
Treasurer or any Assistant Treasurer, or the Secretary of the Company.

      "OPINION OF COUNSEL" means an opinion in writing signed by legal
counsel, who may be an employee of or counsel to the Company, or other counsel
reasonably acceptable to the Trustee.

      "OUTSTANDING", when used with reference to Notes and subject to the
provisions of Section 9.04, means, as of any particular time, all Notes
authenticated and delivered by the Trustee under this Indenture, except:

            (a) Notes theretofore canceled by the Trustee or delivered to the
      Trustee for cancellation;

            (b) Notes, or portions thereof, (i) for the redemption of which
      monies in the necessary amount shall have been deposited in trust with the
      Trustee or with any paying agent (other than the Company) or (ii) which
      shall have been otherwise defeased in accordance with Article 13;

            (c) Notes in lieu of which, or in substitution for which, other
      Notes shall have been authenticated and delivered pursuant to the terms of
      Section 2.06; and

            (d) Notes converted into Common Stock pursuant to Article 15 and
      Notes deemed not outstanding pursuant to Article 3.

      "PERSON" means a corporation, an association, a partnership, a limited
liability company, an individual, a joint venture, a joint stock company, a
trust, an unincorporated organization or a government or an agency or a
political subdivision thereof.

      "PORTAL MARKET" means The Portal Market operated by the National
Association of Securities Dealers, Inc. or any successor thereto.

      "PREDECESSOR NOTE" of any particular Note means every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note, and, for the purposes of this


                                       7
<PAGE>

definition, any Note authenticated and delivered under Section 2.06 in lieu of a
lost, destroyed or stolen Note shall be deemed to evidence the same debt as the
lost, destroyed or stolen Note that it replaces.

     "PREMIUM" means any premium payable under the terms of the Notes.

     "PURCHASED SHARES" has the meaning specified in Section 15.05(f).

     "QIB" means a "QUALIFIED INSTITUTIONAL BUYER" as defined in Rule 144A.

     "RECORD DATE", with respect to any interest payment date, has the meaning
specified in Section 2.03.

     "RECORD DATE" has the meaning specified in Section 15.05(h).

     "REGISTRATION RIGHTS AGREEMENT" means the Registration Rights Agreement,
dated as of December 23, 2002, between the Company and the Initial Purchasers,
as amended from time to time in accordance with its terms.

     "REPURCHASE DATE" has the meaning specified in Section 3.06.

     "REPURCHASE NOTICE" has the meaning specified in Section 3.06.

     "RESPONSIBLE OFFICER" means, when used with respect to the Trustee, any
officer within the corporate trust department of the Trustee, including any vice
president, assistant vice president, assistant secretary, assistant treasurer,
trust officer or any other officer of the Trustee who customarily performs
functions similar to those performed by the persons who at the time shall be
such officers, respectively, or to whom any corporate trust matter is referred
because of such person's knowledge of any familiarity with the particular
subject and who shall have direct responsibility for the administration of this
Indenture.

     "RESTRICTED SECURITIES" has the meaning specified in Section 2.05(c).

     "RULE 144A" means Rule 144A as promulgated under the Securities Act.

     "SECURITIES" has the meaning specified in Section 15.05(d).

     "SECURITIES ACT" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder, as in effect from time to time.

     "SENIOR CREDIT FACILITY" means (a) the Credit Agreement dated as of March
26, 2002, among the Company, the Lenders defined therein, JPMorgan Chase Bank,
as administrative agent for the Lenders thereunder, General Electric Capital
Corporation, as documentation agent, and Morgan Stanley Senior Funding, Inc., as
arranger and syndication agent, as amended by a first amendment dated as of
August 26, 2002 and a second amendment dated as of December 16, 2002, as such
agreement is further amended, supplemented, extended, restated, renewed or
otherwise modified from time to time, and any refinancing, replacement or
substitution thereof or therefor, or of or for any previous refinancing,
replacement or substitution and (b) the other


                                        8
<PAGE>

 Loan Documents (as defined in the Senior Credit Facility) and any other
 document or instrument entered into in connection therewith.

            "SENIOR DEBT" means:

                  (1) all Debt of the Company outstanding, from time to time,
            under the Senior Credit Facility and all hedging obligations with
            respect thereto;

                  (2) the 9 1/2% Senior Notes and any other Debt of the Company,
            unless the instrument under which such Debt is created, incurred,
            assumed or guaranteed expressly provides that it is subordinated to
            any Senior Debt or on a parity with or subordinated in right of
            payment to the Notes; and

                  (3) all obligations with respect to the items listed in the
            preceding clauses (1) and (2), including, without limitation,
            principal, premium, interest (including, without limitation,
            interest, as provided in the Senior Credit Agreement, accruing after
            the filing of a petition initiating any proceeding referred to in
            Section 7.01 (e) or 7.01(f), whether or not such interest accrues
            after the filing of such petition for purposes of Title 11 of the
            United States Code or is an allowed claim in such proceeding), rent,
            fees, costs, expenses and other amounts accrued.

            Notwithstanding anything to the contrary in the preceding, Senior
Debt will not include:

                  (1)   any liability for federal, state, local or other taxes
                        owed or owing;

                  (2)   any intercompany Debt of the Company or any of its
                        Subsidiaries;

                  (3)   the Notes; and

                  (4)   Debt which, when incurred and without respect to any
                        election under section 1111 (b) of Title 11, United
                        States Code, is without recourse to the Company or any
                        of its Subsidiaries.

            "SIGNIFICANT SUBSIDIARY" means, as of any date of determination, a
Subsidiary of the Company that would constitute a "SIGNIFICANT SUBSIDIARY" as
such term is defined under Rule 1-02(w) of Regulation S-X of the Commission as
in effect on the date of this Indenture.

            "SUBORDINATED DEBT" has the meaning specified in Section 16.01.

            "SUBSIDIARY" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of capital stock or other equity interest entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by such Person or one or more of the other subsidiaries
of that Person (or a combination thereof) and (ii) any partnership (a) the sole
general partner or managing general partner of which is such Person or a
subsidiary of such Person or (b) the only general partners of which are such
Person or one or more subsidiaries of such Person (or any combination thereof).


                                        9
<PAGE>

            "TAX ORIGINAL ISSUE DISCOUNT" means the amount of ordinary interest
income on a Note that must be accrued as original issue discount for United
States Federal income tax purposes pursuant to U.S. Treasury Regulation section
1.1275-4.

            "TRADING DAY" has the meaning specified in Section 15.05(h).

            "TRADING PRICE" means, on any date, the average of the secondary
market bid quotations for the Notes obtained by the Trustee for $10,000,000
principal amount of Notes at approximately 3:30 p.m., New York City time, on
such date from three independent nationally recognized securities dealers in The
City of New York (none of which shall be an Affiliate of the Company) selected
by the Company; provided that if at least three such bids cannot reasonably be
obtained by the Trustee, but two bids are obtained, then the average of the two
bids shall be used, and if only one such bid can reasonably be obtained by the
Trustee, one bid shall be used; and provided further that if the Trustee cannot
reasonably obtain at least one bid for $10,000,000 principal amount of Notes
from a nationally recognized securities dealer or, in the Company's reasonable
judgment, the bid quotations are not indicative of the secondary market value of
the Notes, then the Trading Price per $1,000 principal amount of Notes shall be
deemed to the product of (a) the Conversion Rate in effect as of such
determination date and (b) the average Closing Sale Price of the Common Stock
for the five Trading Days ending on such determination date, appropriately
adjusted to take into account the occurrence, during the period commencing on
the first of such Trading Days during such five Trading Day period and ending on
such determination date, of any event described in Sections 15.05 and 15.06.

            "TRIGGER EVENT" has the meaning specified in Section 15.05(d).

            "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939, as
amended, as it was in force at the date of this Indenture, except as provided in
Sections 11.03 and 17.07; provided that if the Trust Indenture Act of 1939 is
amended after the date hereof, the term "TRUST INDENTURE ACT" shall mean, to the
extent required by such amendment, the Trust Indenture Act of 1939 as so
amended.

            "Trustee" means Fifth Third Bank, Indiana, and its successors and
any corporation resulting from or surviving any consolidation or merger to which
it or its successors may be a party and any successor trustee at the time
serving as successor trustee hereunder.

            "9 1/2% SENIOR NOTES" means the 9 1/2% Senior Notes due 2009 issued
by the Company in an aggregate principal amount of $200 million pursuant to an
Indenture, dated as of March 26, 2002, among the Company and Fifth Third Bank,
Indiana, as amended or supplemented from time to time.

                                    ARTICLE 2

        ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES

            Section 2.01. Designation Amount and Issue of Notes. The Notes shall
be designated as "4% CONVERTIBLE SUBORDINATED NOTES DUE 2012". Notes not to
exceed the aggregate principal amount of $100,000,000, or in the event that the
Initial Purchasers exercise their option under the


                                       10
<PAGE>

Note Purchase Agreement to purchase additional Notes, in an aggregate principal
amount not to exceed $125,000,000 (except pursuant to Sections 2.05, 2.06, 3.03,
3.05 and 15.02 hereof) upon the execution of this Indenture, or from time to
time thereafter, may be executed by the Company and delivered to the Trustee for
authentication, and the Trustee shall thereupon authenticate and deliver said
Notes to or upon the written order of the Company, signed by its Chairman of the
Board, Chief Executive Officer, President or any Vice President (whether or not
designated by a number or numbers or word or words added before or after the
title "VICE PRESIDENT"), the Treasurer or any Assistant Treasurer or the
Secretary, without any further action by the Company hereunder.

            Section 2.02. Form of Notes. The Notes and the Trustee's certificate
of authentication to be borne by such Notes shall be substantially in the form
set forth in Exhibit A. The terms and provisions contained in the form of Note
attached as Exhibit A hereto shall constitute, and are hereby expressly made, a
part of this Indenture and, to the extent applicable, the Company and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby.

            Any of the Notes may have such letters, numbers or other marks of
identification and such notations, legends, endorsements or changes as the
officers executing the same may approve (execution thereof to be conclusive
evidence of such approval) and as are not inconsistent with the provisions of
this Indenture, or as may be required by the Custodian, the Depositary or by the
National Association of Securities Dealers, Inc. in order for the Notes to be
tradable on The Portal Market or as may be required for the Notes to be tradable
on any other market developed for trading of securities pursuant to Rule 144A or
as may be required to comply with any applicable law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any
securities exchange or automated quotation system on which the Notes may be
listed, or to conform to usage, or to indicate any special limitations or
restrictions to which any particular Notes are subject.

            So long as the Notes are eligible for book-entry settlement with the
Depositary, or unless otherwise required by law, or otherwise contemplated by
Section 2.05(a), all of the Notes will be represented by one or more Notes in
global form registered in the name of the Depositary or the nominee of the
Depositary (a "GLOBAL NOTE"). The transfer and exchange of beneficial interests
in any such Global Note shall be effected through the Depositary in accordance
with this Indenture and the applicable procedures of the Depositary. Except as
provided in Section 2.05(a), beneficial owners of a Global Note shall not be
entitled to have certificates registered in their names, will not receive or be
entitled to receive physical delivery of certificates in definitive form and
will not be considered holders of such Global Note.

            Any Global Note shall represent such of the outstanding Notes as
shall be specified therein and shall provide that it shall represent the
aggregate amount of outstanding Notes from time to time endorsed thereon and
that the aggregate amount of outstanding Notes represented thereby may from time
to time be increased or reduced to reflect redemptions, repurchases,
conversions, transfers or exchanges permitted hereby. Any endorsement of a
Global Note to reflect the amount of any increase or decrease in the amount of
outstanding Notes represented thereby shall be made by the Trustee or the
Custodian, at the direction of the Trustee, in such manner and upon instructions
given by the holder of such Notes in accordance with this


                                       11
<PAGE>

Indenture. Payment of principal of and interest and premium, if any, on any
Global Note shall be made to the holder of such Note.

            Section 2.03. Date and Denomination of Notes; Payments of Interest.
The Notes shall be issuable in registered form without coupons in denominations
of $1,000 principal amount and integral multiples thereof. Each Note shall be
dated the date of its authentication and shall bear interest from the date
specified on the face of the form of Note attached as Exhibit A hereto. Interest
on the Notes shall be computed on the basis of a 360-day year comprised of
twelve 30-day months.

            The Person in whose name any Note (or its Predecessor Note) is
registered on the Note register at the close of business on any record date with
respect to any interest payment date shall be entitled to receive the interest
payable on such interest payment date, except that the interest payable upon
redemption or repurchase will be payable to the Person to whom principal is
payable pursuant to such redemption or repurchase (unless the redemption date or
the Repurchase Date, as the case may be, is an interest payment date, in which
case the semi-annual payment of interest becoming due on such date shall be
payable to the holders of such Notes registered as such on the applicable record
date). Notwithstanding the foregoing, if any Note (or portion thereof) is
converted into Common Stock during the period after a record date for the
payment of interest to, but excluding, the next succeeding interest payment date
and such Note (or portion thereof) has been called or tendered for redemption or
repurchase on a redemption or repurchase date which occurs during such period,
the Company shall not be required to pay interest on such interest payment date
in respect of any such Note (or portion thereof). The Company shall pay interest
(i) on any Notes in certificated form by check mailed to the address of the
Person entitled thereto as it appears in the Note register; provided that if any
holder of Notes with an aggregate principal amount in excess of $2.0 million
shall request in writing, the Company shall pay interest on such holder's Notes
by wire transfer of immediately available funds to the account designated by
such holder, or (ii) on any Global Note by wire transfer of immediately
available funds to the account of the Depositary or its nominee. The term
"RECORD DATE" with respect to any interest payment date shall mean the June 1 or
December 1 preceding the applicable June 15 or December 15 interest payment
date, respectively.

            Any interest on any Note which is payable, but is not punctually
paid or duly provided for, on any June 15 or December 15 (herein called
"DEFAULTED INTEREST") shall forthwith cease to be payable to the Noteholder on
the relevant record date by virtue of his having been such Noteholder, and such
Defaulted Interest shall be paid by the Company, at its election in each case,
as provided in clause (1) or (2) below:

                        (1) The Company may elect to make payment of any
            Defaulted Interest to the Persons in whose names the Notes (or their
            respective Predecessor Notes) are registered at the close of
            business on a special record date for the payment of such Defaulted
            Interest, which shall be fixed in the following manner. The Company
            shall notify the Trustee in writing of the amount of Defaulted
            Interest proposed to be paid on each Note and the date of the
            proposed payment (which shall be not less than twenty-five (25) days
            after the receipt by the Trustee of such notice, unless the Trustee
            shall consent to an earlier date), and at the same time the Company
            shall deposit with the Trustee an amount of money equal to the
            aggregate amount to be paid in respect of such Defaulted Interest



                                       12
<PAGE>

            or shall make arrangements satisfactory to the Trustee for such
            deposit on or prior to the date of the proposed payment, such money
            when deposited to be held in trust for the benefit of the Persons
            entitled to such Defaulted Interest as in this clause provided.
            Thereupon the Trustee shall fix a special record date for the
            payment of such Defaulted Interest which shall be not more than
            fifteen (15) days and not less than ten (10) days prior to the date
            of the proposed payment, and not less than ten (10) days after the
            receipt by the Trustee of the notice of the proposed payment. The
            Trustee shall promptly notify the Company of such special record
            date and, in the name and at the expense of the Company, shall cause
            notice of the proposed payment of such Defaulted Interest and the
            special record date therefor to be mailed, first-class postage
            prepaid, to each holder at his address as it appears in the Note
            register, not less than ten (10) days prior to such special record
            date. Notice of the proposed payment of such Defaulted Interest and
            the special record date therefor having been so mailed, such
            Defaulted Interest shall be paid to the Persons in whose names the
            Notes (or their respective Predecessor Notes) are registered at the
            close of business on such special record date and shall no longer be
            payable pursuant to the following clause (2) of this Section 2.03.

                        (2) The Company may make payment of any Defaulted
            Interest in any other lawful manner not inconsistent with the
            requirements of any securities exchange or automated quotation
            system on which the Notes may be listed or designated for issuance,
            and upon such notice as may be required by such exchange or
            automated quotation system, if, after notice given by the Company to
            the Trustee of the proposed payment pursuant to this clause, such
            manner of payment shall be deemed practicable by the Trustee.

            Section 2.04. Execution of Notes. The Notes shall be signed in the
name and on behalf of the Company by the manual or facsimile signature of its
Chairman of the Board, Chief Executive Officer, President or any Vice President
(whether or not designated by a number or numbers or word or words added before
or after the title "VICE PRESIDENT") and attested by the manual or facsimile
signature of its Secretary or any of its Assistant Secretaries or its Treasurer
or any of its Assistant Treasurers (which may be printed, engraved or otherwise
reproduced thereon, by facsimile or otherwise). Only such Notes as shall bear
thereon a certificate of authentication substantially in the form set forth on
the form of Note attached as Exhibit A hereto, manually executed by the Trustee
(or an authenticating agent appointed by the Trustee as provided by Section
17.11), shall be entitled to the benefits of this Indenture or be valid or
obligatory for any purpose. Such certificate by the Trustee (or such an
authenticating agent) upon any Note executed by the Company shall be conclusive
evidence that the Note so authenticated has been duly authenticated and
delivered hereunder and that the holder is entitled to the benefits of this
Indenture.

            In case any officer of the Company who shall have signed any of the
Notes shall cease to be such officer before the Notes so signed shall have been
authenticated and delivered by the Trustee, or disposed of by the Company, such
Notes nevertheless may be authenticated and delivered or disposed of as though
the person who signed such Notes had not ceased to be such officer of the
Company, and any Note may be signed on behalf of the Company by such persons


                                       13
<PAGE>

as, at the actual date of the execution of such Note, shall be the proper
officers of the Company, although at the date of the execution of this Indenture
any such person was not such an officer.

            Section 2.05. Exchange and Registration of Transfer of Notes;
Restrictions on Transfer. (a) The Company shall cause to be kept at the
Corporate Trust Office a register (the register maintained in such office and in
any other office or agency of the Company designated pursuant to Section 5.02
being herein sometimes collectively referred to as the "NOTE REGISTER") in
which, subject to such reasonable regulations as it may prescribe, the Company
shall provide for the registration of Notes and of transfers of Notes. The Note
register shall be in written form or in any form capable of being converted into
written form within a reasonably prompt period of time. The Trustee is hereby
appointed "NOTE REGISTRAR" for the purpose of registering Notes and transfers of
Notes as herein provided. The Company may appoint one or more co-registrars in
accordance with Section 5.02.

            Upon surrender for registration of transfer of any Note to the Note
registrar or any co-registrar, and satisfaction of the requirements for such
transfer set forth in this Section 2.05, the Company shall execute, and the
Trustee shall authenticate and deliver, in the name of the designated transferee
or transferees, one or more new Notes of any authorized denominations and of a
like aggregate principal amount and bearing such restrictive legends as may be
required by this Indenture.

            Notes may be exchanged for other Notes of any authorized
denominations and of a like aggregate principal amount, upon surrender of the
Notes to be exchanged at any such office or agency maintained by the Company
pursuant to Section 5.02. Whenever any Notes are so surrendered for exchange,
the Company shall execute, and the Trustee shall authenticate and deliver, the
Notes which the Noteholder making the exchange is entitled to receive bearing
registration numbers not contemporaneously outstanding.

            All Notes issued upon any registration of transfer or exchange of
Notes shall be the valid obligations of the Company, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.

            All Notes presented or surrendered for registration of transfer or
for exchange, redemption, repurchase or conversion shall (if so required by the
Company or the Note registrar) be duly endorsed, or be accompanied by a written
instrument or instruments of transfer in form satisfactory to the Company, and
the Notes shall be duly executed by the Noteholder thereof or his attorney duly
authorized in writing.

            No service charge shall be made to any holder for any registration
of, transfer or exchange of Notes, but the Company may require payment by the
holder of a sum sufficient to cover any tax, assessment or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Notes.

            Neither the Company nor the Trustee nor any Note registrar shall be
required to exchange or register a transfer of (a) any Notes for a period of
fifteen (15) days next preceding any selection of Notes to be redeemed, (b) any
Notes or portions thereof called for redemption pursuant to Section 3.02, (c)
any Notes or portions thereof surrendered for conversion pursuant


                                       14
<PAGE>

to Article 15, (d) any Notes or portions thereof tendered for redemption (and
not withdrawn) pursuant to Section 3.05 or (e) any Notes or portions thereof
tendered for repurchase (and not withdrawn) pursuant to Section 3.06.

                        (b) The following provisions shall apply only to Global
            Notes:

                        (i) Each Global Note authenticated under this Indenture
            shall be registered in the name of the Depositary or a nominee
            thereof and delivered to such Depositary or a nominee thereof or
            Custodian therefor, and each such Global Note shall constitute a
            single Note for all purposes of this Indenture.

                        (ii) Notwithstanding any other provision in this
            Indenture, no Global Note may be exchanged in whole or in part for
            Notes registered, and no transfer of a Global Note in whole or in
            part may be registered, in the name of any Person other than the
            Depositary or a nominee thereof unless (A) the Depositary (i) has
            notified the Company that it is unwilling or unable to continue as
            Depositary for such Global Note and a successor depositary has not
            been appointed by the Company within ninety days or (ii) has ceased
            to be a clearing agency registered under the Exchange Act, (B) an
            Event of Default has occurred and is continuing or (C) the Company,
            in its sole discretion, notifies the Trustee in writing that it no
            longer wishes to have all the Notes represented by Global Notes. Any
            Global Note exchanged pursuant to clause (A) or (B) above shall be
            so exchanged in whole and not in part and any Global Note exchanged
            pursuant to clause (C) above may be exchanged in whole or from time
            to time in part as directed by the Company. Any Note issued in
            exchange for a Global Note or any portion thereof shall be a Global
            Note; provided that any such Note so issued that is registered in
            the name of a Person other than the Depositary or a nominee thereof
            shall not be a Global Note.

                        (iii) Securities issued in exchange for a Global Note or
            any portion thereof pursuant to clause (ii) above shall be issued in
            definitive, fully registered form, without interest coupons, shall
            have an aggregate principal amount equal to that of such Global Note
            or portion thereof to be so exchanged, shall be registered in such
            names and be in such authorized denominations as the Depositary
            shall designate and shall bear any legends required hereunder. Any
            Global Note to be exchanged in whole shall be surrendered by the
            Depositary to the Trustee, as Note registrar. With regard to any
            Global Note to be exchanged in part, either such Global Note shall
            be so surrendered for exchange or, if the Trustee is acting as
            Custodian for the Depositary or its nominee with respect to such
            Global Note, the principal amount thereof shall be reduced, by an
            amount equal to the portion thereof to be so exchanged, by means of
            an appropriate adjustment made on the records of the Trustee. Upon
            any such surrender or adjustment, the Trustee shall authenticate and
            make available for delivery the Note issuable on such exchange to or
            upon the written order of the Depositary or an authorized
            representative thereof.

                        (iv) In the event of the occurrence of any of the events
            specified in clause (ii) above, the Company will promptly make
            available to the Trustee a reasonable supply of certificated Notes
            in definitive, fully registered form, without interest coupons.


                                       15
<PAGE>

                        (v) Neither any members of, or participants in, the
            depositary ("AGENT MEMBERS") nor any other Persons on whose behalf
            Agent Members may act shall have any rights under this Indenture
            with respect to any Global Note registered in the name of the
            Depositary or any nominee thereof, and the Depositary or such
            nominee, as the case may be, may be treated by the Company, the
            Trustee and any agent of the Company or the Trustee as the absolute
            owner and holder of such Global Note for all purposes whatsoever.
            Notwithstanding the foregoing, nothing herein shall prevent the
            Company, the Trustee or any agent of the Company or the Trustee from
            giving effect to any written certification, proxy or other
            authorization furnished by the Depositary or such nominee, as the
            case may be, or impair, as between the Depositary, its Agent Members
            and any other Person on whose behalf an Agent Member may act, the
            operation of customary practices of such Persons governing the
            exercise of the rights of a holder of any Note.

                        (vi) At such time as all interests in a Global Note have
            been redeemed, repurchased, converted, canceled or exchanged for
            Notes in certificated form, such Global Note shall, upon receipt
            thereof, be canceled by the Trustee in accordance with standing
            procedures and instructions existing between the Depositary and the
            Custodian. At any time prior to such cancellation, if any interest
            in a Global Note is redeemed, repurchased, converted, canceled or
            exchanged for Notes in certificated form, the principal amount of
            such Global Note shall, in accordance with the standing procedures
            and instructions existing between the Depositary and the Custodian,
            be appropriately reduced, and an endorsement shall be made on such
            Global Note, by the Trustee or the Custodian, at the direction of
            the Trustee, to reflect such reduction.

                        (c) Every Note that bears or is required under this
Section 2.05(c) to bear the legend set forth in this Section 2.05(c) (together
with any Common Stock issued upon conversion of the Notes and required to bear
the legend set forth in this Section 2.05(c), collectively, the "RESTRICTED
SECURITIES") shall be subject to the restrictions on transfer set forth in this
Section 2.05(c) (including those set forth in the legend below) unless such
restrictions on transfer shall be waived by written consent of the Company, and
the holder of each such Restricted Security, by such Note holder's acceptance
thereof, agrees to be bound by all such restrictions on transfer. As used in
Sections 2.05 (c) and 2.05 (d), the term "TRANSFER" encompasses any sale,
pledge, loan, transfer or other disposition whatsoever of any Restricted
Security or any interest therein.

            Until the expiration of the holding period applicable to sales
thereof under Rule 144(k) under the Securities Act (or any successor provision),
any certificate evidencing such Note (and all securities issued in exchange
therefor or substitution thereof, other than Common Stock, if any, issued upon
conversion thereof, which shall bear the legend set forth in this Section
2.05(c), if applicable) shall bear a legend in substantially the following form,
unless such Note has been sold pursuant to a registration statement that has
been declared effective under the Securities Act (and which continues to be
effective at the time of such transfer), or unless otherwise agreed by the
Company in writing, with written notice thereof to the Trustee:

THE NOTE EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD


                                       16
<PAGE>

EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE
HOLDER (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT); (2) AGREES THAT IT WILL NOT, PRIOR TO
EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THIS NOTE UNDER RULE
144(K) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION), RESELL OR
OTHERWISE TRANSFER THIS NOTE OR THE COMMON STOCK ISSUABLE UPON CONVERSION OF
THIS NOTE EXCEPT (A) TO STEEL DYNAMICS, INC. OR ANY SUBSIDIARY THEREOF, (B) TO A
QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES
ACT, (C) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER
THE SECURITIES ACT (IF AVAILABLE) OR (D) PURSUANT TO A REGISTRATION STATEMENT
WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT (AND WHICH CONTINUES
TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER); (3) PRIOR TO SUCH TRANSFER (OTHER
THAN A TRANSFER PURSUANT TO CLAUSE (2)(D) ABOVE), IT WILL FURNISH TO THE FIFTH
THIRD BANK, INDIANA, AS TRUSTEE (OR A SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS IT MAY REASONABLY REQUIRE
TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN
A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT; AND (4) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS LEGEND
WILL BE REMOVED UPON THE EARLIER OF THE TRANSFER OF THIS NOTE PURSUANT TO CLAUSE
(2)(D) ABOVE OR UPON ANY TRANSFER OF THIS NOTE UNDER RULE 144(K) UNDER THE
SECURITIES ACT (OR ANY SUCCESSOR PROVISION). THE INDENTURE CONTAINS A PROVISION
REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN
VIOLATION OF THE FOREGOING RESTRICTION.

THIS NOTE WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR U.S. FEDERAL INCOME TAX
PURPOSES. FOR PURPOSES OF SECTIONS 1273 AND 1275 OF THE INTERNAL REVENUE CODE,
THE ISSUE PRICE OF EACH NOTE IS $1,000 PER $1,000 OF PRINCIPAL AMOUNT, THE ISSUE
DATE IS DECEMBER 23, 2002 AND THE COMPARABLE YIELD IS 9.25%, COMPOUNDED
SEMI-ANNUALLY. HOLDERS OF THIS NOTE MAY OBTAIN INFORMATION REGARDING THE AMOUNT
OF ORIGINAL ISSUE DISCOUNT, YIELD TO MATURITY AND THE PROJECTED PAYMENT SCHEDULE
FOR THIS NOTE BY SUBMITTING A WRITTEN REQUEST FOR SUCH INFORMATION TO: STEEL
DYNAMICS, INC., CHIEF FINANCIAL OFFICER, 6714 POINTE INVERNESS WAY, SUITE 200,
FORT WAYNE, INDIANA 46804.

            Any Note (or security issued in exchange or substitution therefor)
as to which such restrictions on transfer shall have expired in accordance with
their terms or as to conditions for removal of the foregoing legend set forth
therein have been satisfied may, upon surrender of such Note for exchange to the
Note registrar in accordance with the provisions of this Section 2.05, be
exchanged for a new Note or Notes, of like tenor and aggregate principal amount,
which shall not bear the restrictive legend required by this Section 2.05(c). If
the Restricted Security


                                       17
<PAGE>

surrendered for exchange is represented by a Global Note bearing the legend set
forth in this Section 2.05(c), the principal amount of the legended Global Note
shall be reduced by the appropriate principal amount and the principal amount of
a Global Note without the legend set forth in this Section 2.05(c) shall be
increased by an equal principal amount. If a Global Note without the legend set
forth in this Section 2.05(c) is not then outstanding, the Company shall execute
and the Trustee shall authenticate and deliver an unlegended Global Note to the
Depositary.

            (d) Until the expiration of the holding period applicable to sales
thereof under Rule 144(k) under the Securities Act (or any successor provision),
any stock certificate representing Common Stock issued upon conversion of any
Note shall bear a legend in substantially the following form, unless such Common
Stock has been sold pursuant to a registration statement that has been declared
effective under the Securities Act (and which continues to be effective at the
time of such transfer) or such Common Stock has been issued upon conversion of
Notes that have been transferred pursuant to a registration statement that has
been declared effective under the Securities Act, or unless otherwise agreed by
the Company in writing with written notice thereof to the transfer agent:

THE COMMON STOCK EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT AS SET FORTH
IN THE FOLLOWING SENTENCE. THE HOLDER HEREOF AGREES THAT, UNTIL THE EXPIRATION
OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE COMMON STOCK EVIDENCED HEREBY
UNDER RULE 144(K) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION), (1) IT
WILL NOT RESELL OR OTHERWISE TRANSFER THE COMMON STOCK EVIDENCED HEREBY EXCEPT
(A) TO STEEL DYNAMICS, INC. OR ANY SUBSIDIARY THEREOF, (B) TO A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN
COMPLIANCE WITH RULE 144A, (C) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (D) PURSUANT TO
A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT (AND WHICH CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER); (2)
PRIOR TO SUCH TRANSFER (OTHER THAN A TRANSFER PURSUANT TO CLAUSE (1)(D) ABOVE),
IT WILL FURNISH TO EQUISERVE TRUST COMPANY, N.A., AS TRANSFER AGENT (OR A
SUCCESSOR TRANSFER AGENT, AS APPLICABLE), SUCH CERTIFICATIONS, LEGAL OPINIONS OR
OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT
SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT; AND (3) IT
WILL DELIVER TO EACH PERSON TO WHOM THE COMMON STOCK EVIDENCED HEREBY IS
TRANSFERRED (OTHER THAN A TRANSFER PURSUANT TO CLAUSE (1)(D) ABOVE) A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS LEGEND WILL BE REMOVED UPON THE
EARLIER OF THE TRANSFER OF THE COMMON STOCK EVIDENCED HEREBY PURSUANT TO CLAUSE
(1)(D) ABOVE OR UPON ANY


                                       18
<PAGE>

TRANSFER OF THE COMMON STOCK EVIDENCED HEREBY AFTER THE EXPIRATION OF THE
HOLDING PERIOD APPLICABLE TO SALES OF THE SECURITY EVIDENCED HEREBY UNDER RULE
144(K) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION).

      Any such Common Stock as to which such restrictions on transfer shall have
expired in accordance with their terms or as to which the conditions for
removal of the foregoing legend set forth therein have been satisfied may, upon
surrender of the certificates representing such shares of Common Stock for
exchange in accordance with the procedures of the transfer agent for the Common
Stock, be exchanged for a new certificate or certificates for a like number of
shares of Common Stock, which shall not bear the restrictive legend required by
this Section 2.05(d).

            (e) Any Note or Common Stock issued upon the conversion of a Note
that, prior to the expiration of the holding period applicable to sales thereof
under Rule 144(k) under the Securities Act (or any successor provision), is
purchased or owned by the Company or any Affiliate thereof may not be resold by
the Company or such Affiliate unless registered under the Securities Act or
resold pursuant to an exemption from the registration requirements of the
Securities Act in a transaction which results in such Notes or Common Stock, as
the case may be, no longer being "RESTRICTED SECURITIES" (as defined under Rule
144).

      Section 2.06. Mutilated, Destroyed, Lost or Stolen Notes. In case any Note
shall become mutilated or be destroyed, lost or stolen, the Company in its
discretion may execute, and upon its written request the Trustee or an
authenticating agent appointed by the Trustee shall authenticate and make
available for delivery, a new Note, bearing a number not contemporaneously
outstanding, in exchange and substitution for the mutilated Note, or in lieu of
and in substitution for the Note so destroyed, lost or stolen. In every case,
the applicant for a substituted Note shall furnish to the Company, to the
Trustee and, if applicable, to such authenticating agent such security or
indemnity as may be required by them to save each of them harmless for any loss,
liability, cost or expense caused by or connected with such substitution, and,
in every case of destruction, loss or theft, the applicant shall also furnish to
the Company, to the Trustee and, if applicable, to such authenticating agent
evidence to their satisfaction of the destruction, loss or theft of such Note
and of the ownership thereof.

      Following receipt by the Trustee or such authenticating agent, as the case
may be, of satisfactory security or indemnity and evidence, as described in the
preceding paragraph, the Trustee or such authenticating agent may authenticate
any such substituted Note and make available for delivery such Note. Upon the
issuance of any substituted Note, the Company may require the payment by the
holder of a sum sufficient to cover any tax, assessment or other governmental
charge that may be imposed in relation thereto and any other expenses connected
therewith. In case any Note which has matured or is about to mature or has been
called for redemption or has been tendered for redemption upon a Fundamental
Change (and not withdrawn) or has been surrendered for repurchase on a
Repurchase Date (and not withdrawn) or is to be converted into Common Stock
shall become mutilated or be destroyed, lost or stolen, the Company may, instead
of issuing a substitute Note, pay or authorize the payment of or convert or
authorize the conversion of the same (without surrender thereof except in the
case of a mutilated Note), as the case may be, if the applicant for such payment
or conversion shall furnish to the Company, to the Trustee and, if applicable,
to such authenticating agent such security or


                                       19
<PAGE>

indemnity as may be required by them to save each of them harmless for any loss,
liability, cost or expense caused by or in connection with such substitution,
and, in every case of destruction, loss or theft, the applicant shall also
furnish to the Company, the Trustee and, if applicable, any paying agent or
conversion agent evidence to their satisfaction of the destruction, loss or
theft of such Note and of the ownership thereof.

      Every substitute Note issued pursuant to the provisions of this Section
2.06 by virtue of the fact that any Note is destroyed, lost or stolen shall
constitute an additional contractual obligation of the Company, whether or not
the destroyed, lost or stolen Note shall be found at any time, and shall be
entitled to all the benefits of (but shall be subject to all the limitations set
forth in) this Indenture equally and proportionately with any and all other
Notes duly issued hereunder. To the extent permitted by law, all Notes shall be
held and owned upon the express condition that the foregoing provisions are
exclusive with respect to the replacement or payment or conversion or redemption
or repurchase of mutilated, destroyed, lost or stolen Notes and shall preclude
any and all other rights or remedies notwithstanding any law or statute existing
or hereafter enacted to the contrary with respect to the replacement or payment
or conversion or redemption or repurchase of negotiable instruments or other
securities without their surrender.

      Section 2.07. Temporary Notes. Pending the preparation of Notes in
certificated form, the Company may execute and the Trustee or an authenticating
agent appointed by the Trustee shall, upon the written request of the Company,
authenticate and deliver temporary Notes (printed or lithographed). Temporary
Notes shall be issuable in any authorized denomination, and substantially in the
form of the Notes in certificated form, but with such omissions, insertions and
variations as may be appropriate for temporary Notes, all as may be determined
by the Company. Every such temporary Note shall be executed by the Company and
authenticated by the Trustee or such authenticating agent upon the same
conditions and in substantially the same manner, and with the same effect, as
the Notes in certificated form. Without unreasonable delay, the Company will
execute and deliver to the Trustee or such authenticating agent Notes in
certificated form and thereupon any or all temporary Notes may be surrendered in
exchange therefor, at each office or agency maintained by the Company pursuant
to Section 5.02 and the Trustee or such authenticating agent shall authenticate
and make available for delivery in exchange for such temporary Notes an equal
aggregate principal amount of Notes in certificated form. Such exchange shall be
made by the Company at its own expense and without any charge therefor. Until so
exchanged, the temporary Notes shall in all respects be entitled to the same
benefits and subject to the same limitations under this Indenture as Notes in
certificated form authenticated and delivered hereunder.

      Section 2.08. Cancellation of Notes. All Notes surrendered for the purpose
of payment, redemption, repurchase, conversion, exchange or registration of
transfer shall, if surrendered to the Company or any paying agent or any Note
registrar or any conversion agent, be surrendered to the Trustee and promptly
canceled by it, or, if surrendered to the Trustee, shall be promptly canceled by
it, and no Notes shall be issued in lieu thereof except as expressly permitted
by any of the provisions of this Indenture. The Trustee shall dispose of such
canceled Notes in accordance with its customary procedures. If the Company shall
acquire any of the Notes, such acquisition shall not operate as a redemption,
repurchase or satisfaction of the indebtedness represented by such Notes unless
and until the same are delivered to the Trustee for cancellation.


                                       20
<PAGE>

      SECTION 2.09. CUSIP Numbers. The Company in issuing the Notes may use
"CUSIP" numbers (if then generally in use), and, if so, the Trustee shall use
"CUSIP" numbers in notices of redemption as a convenience to Noteholders;
provided that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Notes or as contained in
any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Notes, and any such redemption shall not
be affected by any defect in or omission of such numbers. The Company will
promptly notify the Trustee of any change in the "CUSIP" numbers.

                                    ARTICLE 3

                       REDEMPTION AND REPURCHASE OF NOTES

      Section 3.01. Redemption of Notes. Except as otherwise provided in Section
3.05, the Company may not redeem any Notes prior to December 18, 2007. At any
time on or after December 18, 2007 and prior to maturity, the Notes may be
redeemed at the option of the Company, in whole or in part, upon notice as set
forth in Section 3.02, at the redemption prices set forth in the form of Note
attached as Exhibit A hereto, together with accrued and unpaid interest, if any,
to, but excluding the date fixed for redemption; provided that if the applicable
redemption date is an interest payment date, the interest payable on such
interest payment date shall be payable to the holders of record of such Notes on
the applicable record date instead of the holders surrendering such Notes for
redemption on such date.

      Section 3.02. Notice of Optional Redemption; Selection of Notes. In case
the Company shall desire to exercise the right to redeem all or, as the case may
be, any part of the Notes pursuant to Section 3.01, it shall fix a date for
redemption and it or, at its written request received by the Trustee not fewer
than forty-five (45) days prior (or such shorter period of time as may be
acceptable to the Trustee) to the date fixed for redemption, the Trustee in the
name of and at the expense of the Company, shall mail or cause to be mailed a
notice of such redemption not fewer than thirty (30) nor more than sixty (60)
days prior to the redemption date to each holder of Notes so to be redeemed as a
whole or in part at its last address as the same appears on the Note register;
provided that if the Company shall give such notice, it shall also give written
notice of the redemption date to the Trustee. Such mailing shall be by first
class mail. The notice, if mailed in the manner herein provided, shall be
conclusively presumed to have been duly given, whether or not the holder
receives such notice. In any case, failure to give such notice by mail or any
defect in the notice to the holder of any Note designated for redemption as a
whole or in part shall not affect the validity of the proceedings for the
redemption of any other Note. Concurrently with the mailing of any such notice
of redemption, the Company shall issue a press release announcing such
redemption, the form and content of which press release shall be determined by
the Company in its sole discretion. The failure to issue any such press release
or any defect therein shall not affect the validity of the redemption notice or
any of the proceedings for the redemption of any Note called for redemption.

      Each such notice of redemption shall specify the aggregate principal
amount of Notes to be redeemed, the CUSIP number or numbers of the Notes being
redeemed, the date fixed for redemption (which shall be a Business Day), the
redemption price at which Notes are to be redeemed, the place or places of
payment, that payment will be made upon presentation and


                                       21
<PAGE>

surrender of such Notes, that interest accrued to the date fixed for redemption
will be paid as specified in said notice, and that on and after said date
interest thereon or on the portion thereof to be redeemed will cease to accrue.
Such notice shall also state the current Conversion Rate and the date on which
the right to convert such Notes or portions thereof into Common Stock will
expire. If fewer than all the Notes are to be redeemed, the notice of redemption
shall identify the Notes to be redeemed (including CUSIP numbers, if any). In
case any Note is to be redeemed in part only, the notice of redemption shall
state the portion of the principal amount thereof to be redeemed and shall state
that, on and after the redemption date, upon surrender of such Note, a new Note
or Notes in principal amount equal to the unredeemed portion thereof will be
issued.

      On or prior to the redemption date specified in the notice of redemption
given as provided in this Section 3.02, the Company will deposit with the
Trustee or with one or more paying agents (or, if the Company is acting as its
own paying agent, set aside, segregate and hold in trust as provided in Section
5.04) an amount of money in immediately available funds sufficient to redeem on
the redemption date all the Notes (or portions thereof) so called for redemption
(other than those theretofore surrendered for conversion into Common Stock) at
the appropriate redemption price, together with accrued interest to, but
excluding, the redemption date; provided that if such payment is made on the
redemption date it must be received by the Trustee or paying agent, as the case
may be, by 10:00 a.m. New York City time on such date. The Company shall be
entitled to retain any interest, yield or gain on amounts deposited with the
Trustee or any paying agent pursuant to this Section 3.02 in excess of amounts
required hereunder to pay the redemption price and accrued interest to, but
excluding, the redemption date. If any Note called for redemption is converted
pursuant hereto prior to such redemption date, any money deposited with the
Trustee or any paying agent or so segregated and held in trust for the
redemption of such Note shall be paid to the Company upon its written request,
or, if then held by the Company, shall be discharged from such trust. Whenever
any Notes are to be redeemed, the Company will give the Trustee written notice
in the form of an Officers' Certificate not fewer than forty five (45) days (or
such shorter period of time as may be acceptable to the Trustee) prior to the
redemption date as to the aggregate principal amount of Notes to be redeemed.

      If less than all of the outstanding Notes are to be redeemed, the Trustee
shall select the Notes or portions thereof of the Global Note or the Notes in
certificated form to be redeemed (in principal amounts of $1,000 or multiples
thereof) by lot, on a pro rata basis or by another method the Trustee deems fair
and appropriate: If any Note selected for partial redemption is submitted for
conversion in part after such selection, the portion of such Note submitted for
conversion shall be deemed (so far as may be possible) to be the portion to be
selected for redemption. The Notes (or portions thereof) so selected shall be
deemed duly selected for redemption for all purposes hereof, notwithstanding
that any such Note is submitted for conversion in part before the mailing of the
notice of redemption.

      Upon any redemption of less than all of the outstanding Notes, the Company
and the Trustee may (but need not), solely for purposes of determining the pro
rata allocation among such Notes as are unconverted and outstanding at the time
of redemption, treat as outstanding any Notes surrendered for conversion during
the period of fifteen (15) days next preceding the mailing of a notice of
redemption and may (but need not) treat as outstanding any Note


                                       22
<PAGE>

authenticated and delivered during such period in exchange for the unconverted
portion of any Note converted in part during such period.

      Section 3.03. Payment of Notes Called for Redemption by the Company. If
notice of redemption has been given as provided in Section 3.02, the Notes or
portion of Notes with respect to which such notice has been given shall, unless
converted into Common Stock pursuant to the terms hereof, become due and payable
on the date fixed for redemption and at the place or places stated in such
notice at the applicable redemption price, together with interest accrued to
(but excluding) the redemption date, and on and after said date (unless the
Company shall default in the payment of such Notes at the redemption price,
together with interest accrued to said date) interest on the Notes or portion of
Notes so called for redemption shall cease to accrue and, after the close of
business on the Business Day immediately preceding the redemption date (unless
the Company shall default in the payment of such Notes at the redemption price,
together with interest accrued to said date) such Notes shall cease to be
convertible into Common Stock and, except as provided in Sections 8.05 and
13.04, to be entitled to any benefit or security under this Indenture, and the
holders thereof shall have no right in respect of such Notes except the right to
receive the redemption price thereof and unpaid interest to (but excluding) the
redemption date. On presentation and surrender of such Notes at a place of
payment in said notice specified, the said Notes or the specified portions
thereof shall be paid and redeemed by the Company at the applicable redemption
price, together with interest accrued thereon to, but excluding, the redemption
date; provided that if the applicable redemption date is an interest payment
date, the interest payable on such interest payment date shall be payable to the
holders of record of such Notes on the applicable record date instead of the
holders surrendering such Notes for redemption on such date.

      Upon presentation of any Note redeemed in part only, the Company shall
execute and the Trustee shall authenticate and make available for delivery to
the holder thereof, at the expense of the Company, a new Note or Notes, of
authorized denominations, in principal amount equal to the unredeemed portion of
the Notes so presented.

      Notwithstanding the foregoing, the Trustee shall not redeem any Notes or
mail any notice of redemption during the continuance of a default in payment of
interest or premium, if any, on the Notes. If any Note called for redemption
shall not be so paid upon surrender thereof for redemption, the principal and
premium, if any, shall, until paid or duly provided for, bear interest from the
redemption date at a rate equal to 1 % per annum plus the rate borne by the Note
and such Note shall remain convertible into Common Stock until the principal and
premium, if any, and interest shall have been paid or duly provided for.

      Section 3.04. Conversion Arrangement on Call for Redemption. In connection
with any redemption of Notes, the Company may arrange for the purchase and
conversion of any Notes by an agreement with one or more investment banks or
other purchasers to purchase such Notes by paying to the Trustee in trust for
the Noteholders, on or before the date fixed for redemption, an amount not less
than the applicable redemption price, together with interest accrued to, but
excluding, the date fixed for redemption, of such Notes. Notwithstanding
anything to the contrary contained in this Article 3, the obligation of the
Company to pay the redemption price of such Notes, together with interest
accrued to, but excluding, the date fixed for redemption, shall be deemed to be
satisfied and discharged to the extent such amount is so paid by such


                                       23
<PAGE>

purchasers. If such an agreement is entered into, a copy of which will be filed
with the Trustee prior to the date fixed for redemption, any Notes not duly
surrendered for conversion by the holders thereof may, at the option of the
Company, be deemed, to the fullest extent permitted by law, acquired by such
purchasers from such holders and (notwithstanding anything to the contrary
contained in Article 15) surrendered by such purchasers for conversion, all as
of immediately prior to the close of business on the date fixed for redemption
(and the right to convert any such Notes shall be extended through such time),
subject to payment of the above amount as aforesaid. At the direction of the
Company, the Trustee shall hold and dispose of any such amount paid to it in the
same manner as it would monies deposited with it by the Company for the
redemption of Notes. Without the Trustee's prior written consent, no arrangement
between the Company and such purchasers for the purchase and conversion of any
Notes shall increase or otherwise affect any of the powers, duties,
responsibilities or obligations of the Trustee as set forth in this Indenture.

      Section 3.05. Redemption at Option of Holders upon a Fundamental Change.
(a) If there shall occur a Fundamental Change at any time prior to maturity of
the Notes, then each Noteholder shall have the right, at such holder's option,
to require the Company to redeem all of such holder's Notes, or any portion
thereof that is a multiple of $1,000 principal amount, on the date (the
"FUNDAMENTAL CHANGE REDEMPTION DATE") that is thirty (30) days after the date of
the Fundamental Change Notice (as defined in Section 3.05(b)) of such
Fundamental Change (or, if such 30th day is not a Business Day, the next
succeeding Business Day) at a redemption price equal to 100% of the principal
amount thereof, together with accrued interest to, but excluding, the
Fundamental Change Redemption Date; provided that if such Fundamental Change
Redemption Date is an interest payment date, then the interest payable on such
interest payment date shall be paid to the holders of record of the Notes on the
applicable record date instead of the holders surrendering the Notes for
redemption on such date.

      Upon presentation of any Note redeemed in part only, the Company shall
execute and, upon the Company's written direction to the Trustee, the Trustee
shall authenticate and make available for delivery to the holder thereof, at the
expense of the Company, a new Note or Notes, of authorized denominations, in
aggregate principal amount equal to the unredeemed portion of the Notes
presented.

            (b) On or before the tenth day after the occurrence of a Fundamental
Change, the Company or at its written request (which must be received by the
Trustee at least five (5) Business Days prior to the date the Trustee is
requested to give notice as described below, unless the Trustee shall agree in
writing to a shorter period), the Trustee, in the name of and at the expense of
the Company, shall mail or cause to be mailed to all holders of record on the
date of the Fundamental Change a notice (the "FUNDAMENTAL CHANGE NOTICE") of the
occurrence of such Fundamental Change and of the redemption right at the option
of the holders arising as a result thereof. Such notice shall be mailed in the
manner and with the effect set forth in the first paragraph of Section 3.02
(without regard for the time limits set forth therein). If the Company shall
give such notice, the Company shall also deliver a copy of the Fundamental
Change Company Notice to the Trustee at such time as it is mailed to
Noteholders. Concurrently with the mailing of any Fundamental Change Notice, the
Company shall issue a press release announcing such Fundamental Change referred
to in the Fundamental Change Notice, the form


                                       24
<PAGE>

and content of which press release shall be determined by the Company in its
sole discretion. The failure to issue any such press release or any defect
therein shall not affect the validity of the Fundamental Change Notice or any
proceedings for the redemption of any Note which any Noteholder may elect to
have the Company redeem as provided in this Section 3.05.

      Each Fundamental Change Notice shall specify the circumstances
constituting the Fundamental Change, the Fundamental Change Redemption Date, the
price at which the Company shall be obligated to redeem Notes, that the holder
must exercise the redemption right on or prior to the close of business on the
Fundamental Change Redemption Date (the "FUNDAMENTAL CHANGE EXPIRATION TIME"),
that the holder shall have the right to withdraw any Notes surrendered prior to
the Fundamental Change Expiration Time, a description of the procedure which a
Noteholder must follow to exercise such redemption right and to withdraw any
surrendered Notes, the place or places where the holder is to surrender such
holder's Notes, the amount of interest accrued on each Note to the Fundamental
Change Redemption Date and the CUSIP number or numbers of the Notes (if then
generally in use).

      No failure of the Company to give the foregoing notices and no defect
therein shall limit the Noteholders' redemption rights or affect the validity of
the proceedings for the redemption of the Notes pursuant to this Section 3.05.

            (c) For a Note, other than a Global Note to be so redeemed at the
option of the holder, the Company must receive at the office or agency of the
Company maintained for that purpose or, at the option of such holder, the
Corporate Trust Office, such Note with the form entitled "OPTION TO ELECT
REPAYMENT UPON A FUNDAMENTAL CHANGE" on the reverse thereof duly completed,
together with such Notes duly endorsed for transfer, on or before the
Fundamental Change Expiration Time. All questions as to the validity,
eligibility (including time of receipt) and acceptance of any Note for
redemption shall be determined by the Company, whose determination shall be
final and binding absent manifest error.

            (d) On or prior to the Fundamental Change Redemption Date, the
Company will deposit with the Trustee or with one or more paying agents (or, if
the Company is acting as its own paying agent, set aside, segregate and hold in
trust as provided in Section 5.04) an amount of money sufficient to redeem on
the Fundamental Change Redemption Date all the Notes to be redeemed on such date
at the appropriate redemption price, together with accrued interest to, but
excluding, the Fundamental Change Redemption Date; provided that if such payment
is made on the Fundamental Change Redemption Date it must be received by the
Trustee or paying agent, as the case may be, by 10:00 a.m. New York City time,
on such date. Payment for Notes surrendered for redemption (and not withdrawn)
prior to the Fundamental Change Expiration Time will be made promptly (but in no
event more than five (5) Business Days) following the Fundamental Change
Redemption Date by mailing checks for the amount payable to the holders of such
Notes entitled thereto as they shall appear in the Note register.

            (e) In the case of a reclassification, change, consolidation,
merger, combination, sale or conveyance to which Section 15.06 applies, in which
the Common Stock of the Company is changed or exchanged as a result into the
right to receive stock, securities or other property or assets (including cash),
which includes shares of Common Stock of the Company or shares of common stock
of another Person that are, or upon issuance will be, traded


                                       25
<PAGE>

on a United States national securities exchange or approved for trading on an
established automated over-the-counter trading market in the United States and
such shares constitute at the time such change or exchange becomes effective in
excess of 50% of the aggregate fair market value of such stock, securities or
other property or assets (including cash) (as determined by the Company, which
determination shall be conclusive and binding), then the Person formed by such
consolidation or resulting from such merger or which acquires such assets, as
the case may be, shall execute and deliver to the Trustee a supplemental
indenture (accompanied by an Opinion of Counsel that such supplemental indenture
complies with the Trust Indenture Act as in force at the date of execution of
such supplemental indenture) modifying the provisions of this Indenture relating
to the right of holders of the Notes to cause the Company to repurchase the
Notes following a Fundamental Change, including without limitation the
applicable provisions of this Section 3.05 and the definitions of Common Stock
and Fundamental Change, as appropriate, as determined in good faith by the
Company (which determination shall be conclusive and binding), to make such
provisions apply to such other Person if different from the Company and the
common stock issued by such Person (in lieu of the Company and the Common Stock
of the Company).

            (f) The Company will comply with the provisions of Rule 13e-4 and
any other tender offer rules under the Exchange Act to the extent then
applicable in connection with the redemption rights of the holders of Notes in
the event of a Fundamental Change.

      Section 3.06. Repurchase of Notes by the Company at Option of the Holder.
Notes shall be purchased by the Company pursuant to the terms of the Notes at
the option of the holder on December 15, 2009 (the "REPURCHASE DATE"), at a
purchase price of 100% of the principal amount. Interest on any Note tendered
for repurchase pursuant to this Section 3.06 will be paid to the holder of
record on December 1, 2009. Repurchases of Notes under this Section 3.06 shall
be made, at the option of the holder thereof, upon:

                  (a) delivery to the Trustee (or other paying agent appointed
      by the Company) by a holder of a duly completed notice (the "REPURCHASE
      NOTICE") in the form set forth on the reverse of the Note during the
      period beginning at any time from the opening of business on the date that
      is 20 Business Days prior to the Repurchase Date until the close of
      business on the Repurchase Date; and

                  (b) delivery or book-entry transfer of the Notes to the
      Trustee (or other paying agent appointed by the Company) at any time after
      delivery of the Repurchase Notice (together with all necessary
      endorsements) at the Corporate Trust Office, or any other office, of the
      Trustee (or other paying agent appointed by the Company) in the Borough of
      Manhattan as provided in Section 5.02, such delivery being a condition to
      receipt by the holder of the purchase price therefor; provided that such
      purchase price shall be so paid pursuant to this Section 3.06 only if the
      Note so delivered to the Trustee (or other paying agent appointed by the
      Company) shall conform in all respects to the description thereof in the
      related Repurchase Notice.

      The Company shall purchase from the holder thereof, pursuant to this
Section 3.06, a portion of a Note, if the principal amount of such portion is
$1,000 or a whole multiple of


                                       26
<PAGE>

$1,000. Provisions of this Indenture that apply to the purchase of all of a Note
also apply to the purchase of such portion of such Note.

      Any purchase by the Company contemplated pursuant to the provisions of
this Section 3.06 shall be consummated by the delivery of the consideration to
be received by the holder promptly following the later of the Repurchase Date
and the time of the book-entry transfer or delivery of the Note.

      Notwithstanding anything herein to the contrary, any holder delivering to
the Trustee (or other paying agent appointed by the Company) the Repurchase
Notice contemplated by this Section 3.06 shall have the right to withdraw such
Repurchase Notice at any time prior to the close of business on the Repurchase
Date by delivery of a written notice of withdrawal to the Trustee (or other
paying agent appointed by the Company) in accordance with Section 3.08.

      The Trustee (or other paying agent appointed by the Company) shall
promptly notify the Company of the receipt by it of any Repurchase Notice or
written notice of withdrawal thereof.

      Section 3.07. Company Repurchase Notice. (a) The Notes to be repurchased
on the Repurchase Date pursuant to Section 3.06 will be paid for in cash.

      At least five (5) Business Days before the Company Repurchase Notice Date,
the Company shall deliver an Officers' Certificate to the Trustee specifying:

            (i) the information required by Section 3.07(b) in the Company
      Repurchase Notice, and

            (ii) whether the Company desires the Trustee to give the Company
      Repurchase Notice required by Section 3.07(b).

            (b) In connection with any repurchase of Notes, the Company shall,
no less than 20 Business Days prior to each Repurchase Date (the "COMPANY
REPURCHASE NOTICE DATE"), give notice to holders at their addresses shown in the
Note Register setting forth information specified in this Section 3.07(b) (the
"COMPANY REPURCHASE NOTICE"). The Company will also give notice to beneficial
owners as required by applicable law.

      Each Company Repurchase Notice shall:

            (1) state the repurchase price and the Repurchase Date to which the
      Company Repurchase Notice relates;

            (2) include a form of Repurchase Notice;

            (3) state the name and address of the Trustee (or other paying agent
      or conversion agent appointed by the Company);

            (4) state that Notes must be surrendered to the Trustee (or other
      paying agent appointed by the Company) to collect the purchase price;


                                       27
<PAGE>

            (5) if the Notes are then convertible, state that Notes as to which
      a Repurchase Notice has been given may be converted only if the Repurchase
      Notice is withdrawn in accordance with the terms of this Indenture; and

            (6) state the CUSIP number of the Notes.

Company Repurchase Notices may be given by the Company or, at the Company's
request, the Trustee shall give such Company Repurchase Notice in the Company's
name and at the Company's expense.

            (c) The Company will comply with the provisions of Rule 13e-4 and
any other tender offer rules under the Exchange Act to the extent then
applicable in connection with the repurchase rights of the holders of Notes.

      Section 3.08. Effect of Repurchase Notice. Upon receipt by the Trustee (or
other paying agent appointed by the Company) of the Repurchase Notice specified
in Section 3.06, the holder of the Note in respect of which such Repurchase
Notice was given shall (unless such Repurchase Notice is validly withdrawn)
thereafter be entitled to receive solely the purchase price with respect to such
Note. Such purchase price shall be paid to such holder, subject to receipt of
funds by the Trustee (or other paying agent appointed by the Company), promptly
following the later of (x) the Repurchase Date with respect to such Note
(provided the holder has satisfied the conditions in Section 3.06) and (y) the
time of delivery of such Note to the Trustee (or other paying agent appointed by
the Company) by the holder thereof in the manner required by Section 3.06. Notes
in respect of which a Repurchase Notice has been given by the holder thereof may
not be converted pursuant to Article 15 hereof on or after the date of the
delivery of such Repurchase Notice unless such Repurchase Notice has first been
validly withdrawn.

      A Repurchase Notice may be withdrawn by means of a written notice of
withdrawal delivered to the office of the Trustee (or other paying agent
appointed by the Company) in accordance with the Repurchase Notice at any time
prior to the close of business on the Repurchase Date, specifying:

            (a) the certificate number, if any, of the Note in respect of which
      such notice of withdrawal is being submitted, or the appropriate
      Depositary information if the Note in respect of which such notice of
      withdrawal is being submitted is represented by a Global Note,

            (b) the principal amount of the Note with respect to which such
      notice of withdrawal is being submitted, and

            (c) the principal amount, if any, of such Note which remains subject
      to the original Repurchase Notice and which has been or will be delivered
      for purchase by the Company.

      A written notice of withdrawal of a Repurchase Notice may be in the form
set forth in the preceding paragraph or may be in the form of a conditional
withdrawal contained in a Repurchase Notice pursuant to the terms of Section
3.06(a).


                                       28


<PAGE>

      Section 3.09. Deposit of Purchase Price. (a) Prior to 10:00 a.m. (New York
City Time) on the Business Day following the Repurchase Date, the Company shall
deposit with the Trustee (or other paying agent appointed by the Company; or, if
the Company or a Subsidiary or an Affiliate of either of them is acting as the
paying agent, shall segregate and hold in trust as provided in Section 5.04) an
amount of cash (in immediately available funds if deposited on such Business
Day), sufficient to pay the aggregate purchase price of all the Notes or
portions thereof that are to be purchased as of the Repurchase Date.

            (b) If the Trustee or other paying agent appointed by the Company,
or the Company or a Subsidiary or Affiliate of either of them, if such entity is
acting as the paying agent, holds cash sufficient to pay the aggregate purchase
price of all the Notes, or portions thereof that are to be purchased as of the
Repurchase Date, on or after the Repurchase Date (i) the Notes will cease to be
outstanding, (ii) interest on the Notes will cease to accrue, and (iii) all
other rights of the holders of such Notes will terminate, whether or not
book-entry transfer of the Notes has been made or the Notes have been delivered
to the Trustee or paying agent, other than the right to receive the repurchase
price upon delivery of the Notes.

      Section 3.10. Notes Repurchased in Part. Upon presentation of any Note
repurchased only in part, the Company shall execute and the Trustee shall
authenticate and make available for delivery to the holder thereof, at the
expense of the Company, a new Note or Notes, of any authorized denomination, in
aggregate principal amount equal to the unrepurchased portion of the Notes
presented.

      Section 3.11. Repayment to the Company. The Trustee (or other paying agent
appointed by the Company) shall return to the Company any cash that remains
unclaimed as provided in Section 12 of the Notes, together with interest, if
any, thereon, held by them for the payment of the purchase price; provided that
to the extent that the aggregate amount of cash deposited by the Company
pursuant to Section 3.09 exceeds the aggregate purchase price of the Notes or
portions thereof which the Company is obligated to purchase as of the Repurchase
Date then, unless otherwise agreed in writing with the Company, promptly after
the Business Day following the Repurchase Date, the Trustee shall return any
such excess to the Company together with interest, if any, thereon.

                                    ARTICLE 4

                               CONTINGENT INTEREST

      Section 4.01. Contingent Interest. Beginning with the six-month interest
period commencing December 15, 2007, the Company will pay contingent interest
during a six month interest period from December 15 to June 14 and June 15 to
December 14, if the Trading Price for each of the five Trading Days immediately
preceding the first day of the applicable six month interest period equals or
exceeds 120% of the principal amount of the Notes. During any six-month interest
period when contingent interest is payable, the contingent interest payable on
each $1,000 principal amount of Note shall equal 0.25% of the average Trading
Price for $1,000 principal amount of Notes during the five Trading Day measuring
period immediately preceding the beginning of applicable six-month interest
period used to determine whether contingent interest must be paid.


                                       29


<PAGE>

      Section 4.02. Payment of Contingent Interest. Contingent interest for any
six-month interest period shall be paid on the interest payment date immediately
following such six month interest period to the Person in whose name any Note
(or its Predecessor Note) is registered on the Note register at the close of
business on the record date with respect to such interest payment date.
Contingent interest due under this Article 4 shall be treated for all purposes
of this Indenture like any other interest accruing on the Notes.

      Section 4.03. Contingent Interest Notification. By the first Business Day
of a six-month interest period during which contingent interest will be paid,
the Company will disseminate a press release through Dow Jones & Company, Inc.
or Bloomberg Business News stating that contingent interest will be paid on the
Notes and identifying the six month interest period.

                                    ARTICLE 5

                       PARTICULAR COVENANTS OF THE COMPANY

      Section 5.01. Payment of Principal, Premium and Interest. The Company
covenants and agrees that it will duly and punctually pay or cause to be paid
the principal of and premium, if any (including the redemption price upon
redemption or the purchase price upon repurchase, in each case pursuant to
Article 3), and interest, on each of the Notes at the places, at the respective
times and in the manner provided herein and in the Notes.

      Section 5.02. Maintenance of Office or Agency. The Company will maintain
an office or agency in the Borough of Manhattan, The City of New York, where the
Notes may be surrendered for registration of transfer or exchange or for
presentation for payment or for conversion, redemption or repurchase and where
notices and demands to or upon the Company in respect of the Notes and this
Indenture may be served. The Company will give prompt written notice to the
Trustee of the location, and any change in the location, of such office or
agency not designated or appointed by the Trustee. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office or the
corporate trust office of the Trustee in the Borough of Manhattan which office
is located at Fifth Third Bank, Indiana, c/o Computershare Trust Company of New
York, Wall Street Plaza, 88 Pine Street, New York, New York 10005.

      The Company may also from time to time designate co-registrars and one or
more offices or agencies where the Notes may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations. The
Company will give prompt written notice of any such designation or rescission
and of any change in the location of any such other office or agency.

      The Company hereby initially designates the Trustee as paying agent, Note
registrar, Custodian and conversion agent and each of the Corporate Trust Office
and the office of agency of the Trustee in the Borough of Manhattan, shall be
considered as one such office or agency of the Company for each of the aforesaid
purposes.


                                       30
<PAGE>

      So long as the Trustee is the Note registrar, the Trustee agrees to mail,
or cause to be mailed, the notices set forth in Section 8.10(a) and the third
paragraph of Section 8.11. If co-registrars have been appointed in accordance
with this Section, the Trustee shall mail such notices only to the Company and
the holders of Notes it can identify from its records.

      Section 5.03. Appointments to Fill Vacancies in Trustee's Office. The
Company, whenever necessary to avoid or fill a vacancy in the office of Trustee,
will appoint, in the manner provided in Section 8.10, a Trustee, so that there
shall at all times be a Trustee hereunder.

      Section 5.04. Provisions as to Paying Agent. (a) If the Company shall
appoint a paying agent other than the Trustee, or if the Trustee shall appoint
such a paying agent, the Company will cause such paying agent to execute and
deliver to the Trustee an instrument in which such agent shall agree with the
Trustee, subject to the provisions of this Section 5.04:

            (1) that it will hold all sums held by it as such agent for the
      payment of the principal of and premium, if any, or interest on the Notes
      (whether such sums have been paid to it by the Company or by any other
      obligor on the Notes) in trust for the benefit of the holders of the
      Notes;

            (2) that it will give the Trustee notice of any failure by the
      Company (or by any other obligor on the Notes) to make any payment of the
      principal of and premium, if any, or interest on the Notes when the same
      shall be due and payable; and

            (3) that at any time during the continuance of an Event of Default,
      upon request of the Trustee, it will forthwith pay to the Trustee all sums
      so held in trust.

      The Company shall, on or before each due date of the principal of,
premium, if any, or interest on the Notes, deposit with the paying agent a sum
(in funds which are immediately available on the due date for such payment)
sufficient to pay such principal, premium, if any, or interest, and (unless such
paying agent is the Trustee) the Company will promptly notify the Trustee of any
failure to take such action; provided that if such deposit is made on the due
date, such deposit shall be received by the paying agent by 10:00 a.m. New York
City time, on such date.

            (b) If the Company shall act as its own paying agent, it will, on or
before each due date of the principal of, premium, if any, or interest on the
Notes, set aside, segregate and hold in trust for the benefit of the holders of
the Notes a sum sufficient to pay such principal, premium, if any, or interest
so becoming due and will promptly notify the Trustee of any failure to take such
action and of any failure by the Company (or any other obligor under the Notes)
to make any payment of the principal of, premium, if any, or interest on the
Notes when the same shall become due and payable.

            (c) Anything in this Section 5.04 to the contrary notwithstanding,
the Company may, at any time, for the purpose of obtaining a satisfaction and
discharge of this Indenture, or for any other reason, pay or cause to be paid to
the Trustee all sums held in trust by the Company or any paying agent hereunder
as required by this Section 5.04, such sums to be held by the Trustee upon the
trusts herein contained and upon such payment by the Company or


                                       31
<PAGE>

any paying agent to the Trustee, the Company or such paying agent shall be
released from all further liability with respect to such sums.

            (d) Anything in this Section 5.04 to the contrary notwithstanding,
the agreement to hold sums in trust as provided in this Section 5.04 is subject
to Sections 13.03 and 13.04.

      The Trustee shall not be responsible for the actions of any other paying
agents (including the Company if acting as its own paying agent) and shall have
no control of any funds held by such other paying agents.

      Section 5.05. Existence. Subject to Article 12, the Company will do or
cause to be done all things necessary to preserve and keep in full force and
effect its existence and rights (charter and statutory); provided that the
Company shall not be required to preserve any such right if the Company shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company and that the loss thereof is not disadvantageous in
any material respect to the Noteholders.

      Section 5.06. Maintenance of Properties. The Company will cause all
properties used or useful in the conduct of its business or the business of any
Significant Subsidiary to be maintained and kept in good condition, repair and
working order and supplied with all necessary equipment and will cause to be
made all necessary repairs, renewals, replacements, betterments and improvements
thereof, all as in the judgment of the Company may be necessary so that the
business carried on in connection therewith may be properly and advantageously
conducted at all times; provided that nothing in this Section shall prevent the
Company from discontinuing the operation or maintenance of any of such
properties if such discontinuance is, in the judgment of the Company, desirable
in the conduct of its business or the business of any subsidiary and not
disadvantageous in any material respect to the Noteholders.

      Section 5.07. Payment of Taxes and Other Claims. The Company will pay or
discharge, or cause to be paid or discharged, before the same may become
delinquent, (i) all taxes, assessments and governmental charges levied or
imposed upon the Company or any Significant Subsidiary or upon the income,
profits or property of the Company or any Significant Subsidiary, (ii) all
claims for labor, materials and supplies which, if unpaid, might by law become a
lien or charge upon the property of the Company or any Significant Subsidiary
and (iii) all stamp taxes and other duties, if any, which may be imposed by the
United States or any political subdivision thereof or therein in connection with
the issuance, transfer, exchange, conversion, redemption or repurchase of any
Notes or with respect to this Indenture; provided that, in the case of clauses
(i) and (ii), the Company shall not be required to pay or discharge or cause to
be paid or discharged any such tax, assessment, charge or claim (A) if the
failure to do so will not, in the aggregate, have a material adverse impact on
the Company, or (B) if the amount, applicability or validity is being contested
in good faith by appropriate proceedings.

      Section 5.08. Rule 144A Information Requirement. Within the period prior
to the expiration of the holding period applicable to sales thereof under Rule
144(k) under the Securities Act (or any successor provision), the Company
covenants and agrees that it shall, during any period in which it is not subject
to Section 13 or 15(d) under the Exchange Act, make


                                       32


<PAGE>

available to any holder or beneficial holder of Notes or any Common Stock issued
upon conversion thereof which continue to be Restricted Securities in connection
with any sale thereof and any prospective purchaser of Notes or such Common
Stock designated by such holder or beneficial holder, the information required
pursuant to Rule 144A(d)(4) under the Securities Act upon the request of any
holder or beneficial holder of the Notes or such Common Stock and it will take
such further action as any holder or beneficial holder of such Notes or such
Common Stock may reasonably request, all to the extent required from time to
time to enable such holder or beneficial holder to sell its Notes or Common
Stock without registration under the Securities Act within the limitation of the
exemption provided by Rule 144A, as such Rule may be amended from time to time.
Upon the request of any holder or any beneficial holder of the Notes or such
Common Stock, the Company will deliver to such holder a written statement as to
whether it has complied with such requirements.

      Section 5.09. Stay, Extension and Usury Laws. The Company covenants (to
the extent that it may lawfully do so) that it shall not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law or other law which would prohibit or
forgive the Company from paying all or any portion of the principal of, premium,
if any, or interest on the Notes as contemplated herein, wherever enacted, now
or at any time hereafter in force, or which may affect the covenants or the
performance of this Indenture and the Company (to the extent it may lawfully do
so) hereby expressly waives all benefit or advantage of any such law, and
covenants that it will not, by resort to any such law, hinder, delay or impede
the execution of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law had been enacted.

      Section 5.10. Compliance Certificate. The Company shall deliver to the
Trustee, within one hundred twenty (120) days after the end of each fiscal year
of the Company, a certificate signed by either the principal executive officer,
principal financial officer or principal accounting officer of the Company,
stating whether or not to the best knowledge of the signer thereof the Company
is in default in the performance and observance of any of the terms, provisions
and conditions of this Indenture (without regard to any period of grace or
requirement of notice provided hereunder) and, if the Company shall be in
default, specifying all such defaults and the nature and the status thereof of
which the signer may have knowledge.

      The Company will deliver to the Trustee, forthwith upon becoming aware of
(i) any default in the performance or observance of any covenant, agreement or
condition contained in this Indenture, or (ii) any Event of Default, an
Officers' Certificate specifying with particularity such default or Event of
Default and further stating what action the Company has taken, is taking or
proposes to take with respect thereto.

      Any notice required to be given under this Section 5.10 shall be delivered
to a Responsible Officer of the Trustee at its Corporate Trust Office.

      Section 5.11. Liquidated Damages Notice. In the event that the Company is
required to pay Liquidated Damages to holders of Notes pursuant to the
Registration Rights Agreement, the Company will provide written notice
("LIQUIDATED DAMAGES NOTICE") to the Trustee of its obligation to pay Liquidated
Damages no later than fifteen (15) days prior to the proposed payment date for
the Liquidated Damages, and the Liquidated Damages Notice shall set forth the


                                       33
<PAGE>

amount of Liquidated Damages to be paid by the Company on such payment date. The
Trustee shall not at any time be under any duty or responsibility to any holder
of Notes to determine the Liquidated Damages, or with respect to the nature,
extent or calculation of the amount of Liquidated Damages when made, or with
respect to the method employed in such calculation of the Liquidated Damages.

      Section 5.12. Contingent Debt Tax Treatment. The Company agrees, and by
acceptance of a Note, each holder hereof is deemed to have agreed, with respect
to each of the matters set forth in (a) and (b) below, as follows:

            (a) Tax Treatment:

                  (i) to treat the Notes as indebtedness of the Company for all
            tax purposes;

                  (ii) to treat the Notes as indebtedness that is subject to the
            special regulations governing contingent payment debt instruments
            that are contained in U.S. Treasury Regulation section 1.1275-4; and

                  (iii) to treat any payment to and receipt by a holder of
            Common Stock upon conversion of a Note as a contingent payment under
            U.S. Treasury Regulation section 1.1275-4(b) that will result in an
            adjustment under U.S. Treasury Regulation section 1.1275-4(b)(3)(iv)
            and U.S. Treasury Regulation section 1.12754(b)(6).

            (b) Comparable Yield and Projected Payment Schedule. Solely for
      purposes of applying U.S. Treasury Regulation section 1.1275-4 to the
      Notes:

                  (i) for United States Federal Income tax purposes, the Company
            shall accrue interest with respect to outstanding Notes as Tax
            Original Issue Discount according to the "noncontingent bond
            method," as set forth in U.S. Treasury Regulation section
            1.1275-4(b);

                  (ii) the Company has determined that the comparable yield, as
            defined in U.S. Treasury Regulation section 1.1275-4(b)(4)(i), for
            the Notes is 9.25%, compounded semiannually;

                  (iii) the Company has determined that the projected payment
            schedule, as defined in U.S. Treasury Regulation section
            1.1275-4(b)(ii), for the Notes consists of the projected payment
            schedule referred to in (v) below;

                  (iv) the Company acknowledges and agrees, and each holder and
            any beneficial holder of the Note, by its purchase of a Note shall
            be deemed to acknowledge and agree that (A) the projected payment
            schedule is determined on a basis of an assumption of linear growth
            of stock price, (B) the comparable yield and the projected payment
            schedule are not determined for any purpose other than for the
            purpose of applying U.S. Treasury Regulation section 1.1275-4(b) to
            the


                                       34

<PAGE>

            Notes and (C) the comparable yield and the projected payment
            schedule do not constitute a projection or representation regarding
            the actual amounts payable on the Notes; and

                  (v) the projected payment schedule, as defined in U.S.
            Treasury Regulation section 1.1275-4(b)(4)(ii) for the Notes is set
            forth in Annex 1 hereto.

      Section 5.13. Calculation of Tax Original Issue Discount. The Company
shall file with the Trustee promptly at the end of each calendar year (i) a
written notice specifying the amount of Tax Original Issue Discount (including
daily rates and accrual periods) accrued on outstanding Notes as of the end of
such year and (ii) such other specific information relating to such Tax Original
Issue Discount as may then be relevant under the Internal Revenue Code of 1986,
as amended from time to time.

                                    ARTICLE 6

          NOTEHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE

      Section 6.01. Noteholders' Lists. The Company covenants and agrees that it
will furnish or cause to be furnished to the Trustee, semiannually, not more
than fifteen (15) days after each January 1 and July 1 in each year beginning
with January 1, 2003, and at such other times as the Trustee may request in
writing, within thirty (30) days after receipt by the Company of any such
request (or such lesser time as the Trustee may reasonably request in order to
enable it to timely provide any notice to be provided by it hereunder), a list
in such form as the Trustee may reasonably require of the names and addresses of
the holders of Notes as of a date not more than fifteen (15) days (or such other
date as the Trustee may reasonably request in order to so provide any such
notices) prior to the time such information is furnished, except that no such
list need be furnished by the Company to the Trustee so long as the Trustee is
acting as the sole Note registrar.

      Section 6.02. Preservation and Disclosure of Lists. (a) The Trustee shall
preserve, in as current a form as is reasonably practicable, all information as
to the names and addresses of the holders of Notes contained in the most recent
list furnished to it as provided in Section 6.01 or maintained by the Trustee in
its capacity as Note registrar or co-registrar in respect of the Notes, if so
acting. The Trustee may destroy any list furnished to it as provided in Section
6.01 upon receipt of a new list so furnished.

            (b) The rights of Noteholders to communicate with other holders of
Notes with respect to their rights under this Indenture or under the Notes, and
the corresponding rights and duties of the Trustee, shall be as provided by the
Trust Indenture Act.

            (c) Every Noteholder, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company nor the Trustee nor any
agent of either of them shall be held accountable by reason of any disclosure of
information as to names and addresses of holders of Notes made pursuant to the
Trust Indenture Act.


                                       35

<PAGE>

      Section 6.03. Reports by Trustee. (a) Within sixty (60) days after
December 15 of each year commencing with the year 2003, the Trustee shall
transmit to holders of Notes such reports dated as of December 15 of the year in
which such reports are made concerning the Trustee and its actions under this
Indenture as may be required pursuant to the Trust Indenture Act at the times
and in the manner provided pursuant thereto.

            (b) A copy of such report shall, at the time of such transmission to
holders of Notes, be filed by the Trustee with each stock exchange and automated
quotation system upon which the Notes are listed and with the Company. The
Company will promptly notify the Trustee in writing when the Notes are listed on
any stock exchange or automated quotation system or delisted therefrom.

      Section 6.04. Reports by Company. The Company shall file with the Trustee
(and the Commission if at any time after the Indenture becomes qualified under
the Trust Indenture Act), and transmit to holders of Notes, such information,
documents and other reports and such summaries thereof, as may be required
pursuant to the Trust Indenture Act at the times and in the manner provided
pursuant to such Act, whether or not the Notes are governed by such Act;
provided that any such information, documents or reports required to be filed
with the Commission pursuant to Section 13 or 15(d) of the Exchange Act shall be
filed with the Trustee within fifteen (15) days after the same is so required to
be filed with the Commission. Delivery of such reports, information and
documents to the Trustee is for informational purposes only and the Trustee's
receipt of such shall not constitute constructive notice of any information
contained therein or determinable from information contained therein, including
the Company's compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on an Officers' Certificates).

                                    ARTICLE 7

         REMEDIES OF THE TRUSTEE AND NOTEHOLDERS ON AN EVENT OF DEFAULT

      Section 7.01. Events of Default. In case one or more of the following
Events of Default (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body) shall have occurred and be
continuing:

                        (a) default in the payment of any installment of
                  interest upon any of the Notes as and when the same shall
                  become due and payable, and continuance of such default for a
                  period of thirty (30) days, whether or not the payment is
                  prohibited by the provisions of Article 16 hereof; or

                        (b) default in the payment of the principal of or
                  premium, if any, on any of the Notes as and when the same
                  shall become due and payable either at maturity or in
                  connection with any redemption, repurchase or otherwise, in
                  each case pursuant to Article 3, by acceleration or otherwise,
                  whether or not the payment is prohibited by the provisions of
                  Article 16 hereof; or


                                       36

<PAGE>

                        (c) default in the payment of principal when due or a
            default resulting in acceleration of any of the Company's other
            indebtedness for borrowed money where the aggregate principal amount
            with respect to which the default or acceleration has occurred
            exceeds $10 million, and such acceleration has not been rescinded or
            annulled within a period of 30 days; or

                        (d) failure on the part of the Company duly to observe
            or perform any other of the covenants or agreements on the part of
            the Company in the Notes or in this Indenture (other than a covenant
            or agreement a default in whose performance or whose breach is
            elsewhere in this Section 7.01 specifically dealt with) continued
            for a period of thirty (30) days after the date on which written
            notice of such failure, requiring the Company to remedy the same,
            shall have been given to the Company by the Trustee, or the Company
            and a Responsible Officer of the Trustee by the holders of at least
            twenty-five percent (25%) in aggregate principal amount of the Notes
            at the time outstanding determined in accordance with Section 9.04;
            or

                        (e) the Company shall commence a voluntary case or other
            proceeding seeking liquidation, reorganization or other relief with
            respect to the Company or its debts under any bankruptcy, insolvency
            or other similar law now or hereafter in effect or seeking the
            appointment of a trustee, receiver, liquidator, custodian or other
            similar official of the Company or any substantial part of the
            property of the Company, or shall consent to any such relief or to
            the appointment of or taking possession by any such official in an
            involuntary case or other proceeding commenced against the Company,
            or shall make a general assignment for the benefit of creditors, or
            shall fail generally to pay its debts as they become due; or

                        (f) an involuntary case or other proceeding shall be
            commenced against the Company seeking liquidation, reorganization or
            other relief with respect to the Company or its debts under any
            bankruptcy, insolvency or other similar law now or hereafter in
            effect or seeking the appointment of a trustee, receiver,
            liquidator, custodian or other similar official of the Company or
            any substantial part of the property of the Company, and such
            involuntary case or other proceeding shall remain undismissed and
            unstayed for a period of ninety (90) consecutive days;

then, and in each and every such case (other than an Event of Default specified
in Section 7.01(e) or 7.01(f)), unless the principal of all of the Notes shall
have already become due and payable, either the Trustee or the holders of not
less than twenty-five percent (25%) in aggregate principal amount of the Notes
then outstanding hereunder determined in accordance with Section 9.04, by notice
in writing to the Company (and to the Trustee if given by Noteholders), may
declare the principal of and premium, if any, on all the Notes and the interest
accrued thereon to be due and payable immediately, and upon any such declaration
the same shall become and shall be immediately due and payable, anything in this
Indenture or in the Notes contained to the contrary notwithstanding. If an Event
of Default specified in Section 7.01(e) or 7.01(f) occurs, the principal of
all the Notes and the interest accrued thereon shall be immediately and
automatically due and payable without necessity of further action. This
provision, however, is subject to the conditions that if, at any time after the
principal of the Notes shall have been so declared due and payable, and before
any judgment or decree for the payment of the monies due shall have been


                                       37
<PAGE>

obtained or entered as hereinafter provided, the Company shall pay or shall
deposit with the Trustee a sum sufficient to pay all matured installments of
interest upon all Notes and the principal of and premium, if any, on any and all
Notes which shall have become due otherwise than by acceleration (with interest
on overdue installments of interest (to the extent that payment of such interest
is enforceable under applicable law) and on such principal and premium, if any,
at the rate borne by the Notes, to the date of such payment or deposit) and
amounts due to the Trustee pursuant to Section 8.06, and if any and all defaults
under this Indenture, other than the nonpayment of principal of and premium, if
any, and accrued interest on Notes which shall have become due by acceleration,
shall have been cured or waived pursuant to Section 7.07, then and in every such
case the holders of a majority in aggregate principal amount of the Notes then
outstanding, by written notice to the Company and to the Trustee, may waive all
defaults or Events of Default and rescind and annul such declaration and its
consequences; but no such waiver or rescission and annulment shall extend to or
shall affect any subsequent default or Event of Default, or shall impair any
right consequent thereon. The Company shall notify in writing a Responsible
Officer of the Trustee, promptly upon becoming aware thereof, of any Event of
Default.

      In case the Trustee shall have proceeded to enforce any right under this
Indenture and such proceedings shall have been discontinued or abandoned because
of such waiver or rescission and annulment or for any other reason or shall have
been determined adversely to the Trustee, then and in every such case the
Company, the holders of Notes, and the Trustee shall be restored respectively to
their several positions and rights hereunder, and all rights, remedies and
powers of the Company, the holders of Notes, and the Trustee shall continue as
though no such proceeding had been taken.

      Section 7.02. Payments of Notes on Default; Suit Therefor. The Company
covenants that (a) in case default shall be made in the payment of any
installment of interest upon any of the Notes as and when the same shall become
due and payable, and such default shall have continued for a period of thirty
(30) days, or (b) in case a default shall be made in the payment of the
principal of or premium, if any, on any of the Notes as and when the same shall
have become due and payable, whether at maturity of the Notes or in connection
with any redemption or repurchase of the Notes, by acceleration or otherwise,
then, upon demand of the Trustee, the Company will pay to the Trustee, for the
benefit of the holders of the Notes, the whole amount that then shall have
become due and payable on all such Notes for principal and premium, if any, or
interest, as the case may be, with interest upon the overdue principal and
premium, if any, and (to the extent that payment of such interest is enforceable
under applicable law) upon the overdue installments of interest at the rate
borne by the Notes, plus 1 % and, in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of collection, including
reasonable compensation to the Trustee, its agents, attorneys and counsel, and
all other amounts due the Trustee under Section 8.06. Until such demand by the
Trustee, the Company may pay the principal of and premium, if any, and interest
on the Notes to the registered holders, whether or not the Notes are overdue.

      In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any actions or proceedings at law or in
equity for the collection of the sums so due and


                                       38
<PAGE>

unpaid, and may prosecute any such action or proceeding to judgment or final
decree, and may enforce any such judgment or final decree against the Company or
any other obligor on the Notes and collect in the manner provided by law out of
the property of the Company or any other obligor on the Notes wherever situated
the monies adjudged or decreed to be payable.

      In case there shall be pending proceedings for the bankruptcy or for the
reorganization of the Company or any other obligor on the Notes under Title 11
of the United States Code, or any other applicable law, or in case a receiver,
assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator or
similar official shall have been appointed for or taken possession of the
Company or such other obligor, the property of the Company or such other
obligor, or in the case of any other judicial proceedings relative to the
Company or such other obligor upon the Notes, or to the creditors or property of
the Company or such other obligor, the Trustee, irrespective of whether the
principal of the Notes shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Trustee shall have made
any demand pursuant to the provisions of this Section 7.02, shall be entitled
and empowered, by intervention in such proceedings or otherwise, to file and
prove a claim or claims for the whole amount of principal, premium, if any, and
interest owing and unpaid in respect of the Notes, and, in case of any judicial
proceedings, to file such proofs of claim and other papers or documents as may
be necessary or advisable in order to have the claims of the Trustee and of the
Noteholders allowed in such judicial proceedings relative to the Company or any
other obligor on the Notes, its or their creditors, or its or their property,
and to collect and receive any monies or other property payable or deliverable
on any such claims, and to distribute the same after the deduction of any
amounts due the Trustee under Section 8.06, and any receiver, assignee or
trustee in bankruptcy or reorganization, liquidator, custodian or similar
official is hereby authorized by each of the Noteholders to make such payments
to the Trustee, and, in the event that the Trustee shall consent to the making
of such payments directly to the Noteholders, to pay to the Trustee any amount
due it for reasonable compensation, expenses, advances and disbursements,
including counsel fees and expenses incurred by it up to the date of such
distribution. To the extent that such payment of reasonable compensation,
expenses, advances and disbursements out of the estate in any such proceedings
shall be denied for any reason, payment of the same shall be secured by a lien
on, and shall be paid out of, any and all distributions, dividends, monies,
securities and other property which the holders of the Notes may be entitled to
receive in such proceedings, whether in liquidation or under any plan of
reorganization or arrangement or otherwise.

      All rights of action and of asserting claims under this Indenture, or
under any of the Notes, may be enforced by the Trustee without the possession of
any of the Notes, or the production thereof at any trial or other proceeding
relative thereto, and any such suit or proceeding instituted by the Trustee
shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the holders of the Notes.

      In any proceedings brought by the Trustee (and in any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee


                                       39
<PAGE>

shall be held to represent all the holders of the Notes, and it shall not be
necessary to make any holders of the Notes parties to any such proceedings.

      Section 7.03. Application of Monies Collected by Trustee. Any monies
collected by the Trustee pursuant to this Article 7 shall be applied in the
order following, at the date or dates fixed by the Trustee for the distribution
of such monies, upon presentation of the several Notes, and stamping thereon the
payment, if only partially paid, and upon surrender thereof, if fully paid:

            FIRST: To the payment of all amounts due the Trustee under Section
      8.06;

            SECOND: In case the principal of the outstanding Notes shall not
      have become due and be unpaid, to the payment of interest on the Notes in
      default in the order of the maturity of the installments of such interest,
      with interest (to the extent that such interest has been collected by the
      Trustee) upon the overdue installments of interest at the rate borne by
      the Notes, such payments to be made ratably to the Persons entitled
      thereto;

            THIRD: In case the principal of the outstanding Notes shall have
      become due, by declaration or otherwise, and be unpaid to the payment of
      the whole amount then owing and unpaid upon the Notes for principal and
      premium, if any, and interest with interest on the overdue principal and
      premium, if any, and (to the extent that such interest has been collected
      by the Trustee) upon overdue installments of interest at the rate borne by
      the Notes, and in case such monies shall be insufficient to pay in full
      the whole amounts so due and unpaid upon the Notes, then to the payment of
      such principal and premium, if any, and interest without preference or
      priority of principal and premium, if any, over interest or of interest
      over principal and premium, if any, or of any installment of interest over
      any other installment of interest, or of any Note over any other Note,
      ratably to the aggregate of such principal and premium, if any, and
      accrued and unpaid interest; and

            FOURTH: To the payment of the remainder, if any, to the Company or
      any other Person lawfully entitled thereto.

      Section 7.04. Proceedings by Noteholder. No holder of any Note shall have
any right by virtue of or by reference to any provision of this Indenture to
institute any suit, action or proceeding in equity or at law upon or under or
with respect to this Indenture, or for the appointment of a receiver, trustee,
liquidator, custodian or other similar official, or for any other remedy
hereunder, unless such holder previously shall have given to the Trustee written
notice of an Event of Default and of the continuance thereof, as hereinbefore
provided, and unless also the holders of not less than twenty-five percent (25%)
in aggregate principal amount of the Notes then outstanding shall have made
written request upon the Trustee to institute such action, suit or proceeding in
its own name as Trustee hereunder and shall have offered to the Trustee such
reasonable security or indemnity as it may require against the costs, expenses
and liabilities to be incurred therein or thereby, and the Trustee for sixty
(60) days after its receipt of such notice, request and offer of indemnity,
shall have neglected or refused to institute any such action, suit or proceeding
and no direction inconsistent with such written request shall have been given to
the Trustee pursuant to Section 7.07; it being understood and intended, and
being expressly covenanted by the taker and holder of every Note with every
other taker and holder and the


                                       40
<PAGE>

Trustee, that no one or more holders of Notes shall have any right in any manner
whatever by virtue of or by reference to any provision of this Indenture to
affect, disturb or prejudice the rights of any other holder of Notes, or to
obtain or seek to obtain priority over or preference to any other such holder,
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal, ratable and common benefit of all holders of Notes
(except as otherwise provided herein). For the protection and enforcement of
this Section 7.04, each and every Noteholder and the Trustee shall be entitled
to such relief as can be given either at law or in equity.

      Notwithstanding any other provision of this Indenture and any provision of
any Note, the right of any holder of any Note to receive payment of the
principal of and premium, if any (including the redemption price upon redemption
pursuant to Article 7), and accrued interest on such Note, on or after the
respective due dates expressed in such Note or in the event of redemption or
repurchase, or to institute suit for the enforcement of any such payment on or
after such respective dates against the Company shall not be impaired or
affected without the consent of such holder.

      Anything in this Indenture or the Notes to the contrary notwithstanding,
the holder of any Note, without the consent of either the Trustee or the holder
of any other Note, in its own behalf and for its own benefit, may enforce, and
may institute and maintain any proceeding suitable to enforce, its rights of
conversion as provided herein.

      Section 7.05. Proceedings by Trustee. In case of an Event of Default, the
Trustee may, in its discretion, proceed to protect and enforce the rights vested
in it by this Indenture by such appropriate judicial proceedings as are
necessary to protect and enforce any of such rights, either by suit in equity or
by action at law or by proceeding in bankruptcy or otherwise, whether for the
specific enforcement of any covenant or agreement contained in this Indenture or
in aid of the exercise of any power granted in this Indenture, or to enforce any
other legal or equitable right vested in the Trustee by this Indenture or by
law.

      Section 7.06. Remedies Cumulative and Continuing. Except as provided in
Section 2.06, all powers and remedies given by this Article 7 to the Trustee or
to the Noteholders shall, to the extent permitted by law, be deemed cumulative
and not exclusive of any thereof or of any other powers and remedies available
to the Trustee or the holders of the Notes, by judicial proceedings or
otherwise, to enforce the performance or observance of the covenants and
agreements contained in this Indenture, and no delay or omission of the Trustee
or of any holder of any of the Notes to exercise any right or power accruing
upon any default or Event of Default occurring and continuing as aforesaid shall
impair any such right or power, or shall be construed to be a waiver of any such
default or any acquiescence therein, and, subject to the provisions of Section
7.04, every power and remedy given by this Article 7 or by law to the Trustee or
to the Noteholders may be exercised from time to time, and as often as shall be
deemed expedient, by the Trustee or by the Noteholders.

      Section 7.07. Direction of Proceedings and Waiver of Defaults by Majority
of Noteholders. The holders of a majority in aggregate principal amount of the
Notes at the time outstanding determined in accordance with Section 9.04 shall
have the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or


                                       41
<PAGE>

exercising any trust or power conferred on the Trustee; provided that (a) such
direction shall not be in conflict with any rule of law or with this Indenture,
(b) the Trustee may take any other action which is not inconsistent with such
direction and (c) the Trustee may decline to take any action that would benefit
some Noteholder to the detriment of other Noteholders. The holders of a majority
in aggregate principal amount of the Notes at the time outstanding determined in
accordance with Section 9.04 may, on behalf of the holders of all of the Notes,
waive any past default or Event of Default hereunder and its consequences except
(i) a default in the payment of interest or premium, if any, on, or the
principal of, the Notes, (ii) a failure by the Company to convert any Notes into
Common Stock, (iii) a default in the payment of the redemption price pursuant to
Article 3, (iv) a default in the payment of the purchase price pursuant to
Article 3 or (v) a default in respect of a covenant or provisions hereof which
under Article 11 cannot be modified or amended without the consent of the
holders of each or all Notes then outstanding or affected thereby. Upon any such
waiver, the Company, the Trustee and the holders of the Notes shall be restored
to their former positions and rights hereunder; but no such waiver shall extend
to any subsequent or other default or Event of Default or impair any right
consequent thereon. Whenever any default or Event of Default hereunder shall
have been waived as permitted by this Section 7.07, said default or Event of
Default shall for all purposes of the Notes and this Indenture be deemed to have
been cured and to be not continuing; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.

      Section 7.08. Notice of Defaults. (a) The Trustee shall, within ninety
(90) days after a Responsible Officer of the Trustee has knowledge of the
occurrence of a default, mail to all Noteholders, as the names and addresses of
such holders appear upon the Note register, notice of all defaults known to a
Responsible Officer, unless such defaults shall have been cured or waived before
the giving of such notice; provided that except in the case of default in the
payment of the principal of, or premium, if any, or interest on any of the
Notes, the Trustee shall be protected in withholding such notice if and so long
as a trust committee of directors and/or Responsible Officers of the Trustee in
good faith determines that the withholding of such notice is in the interests of
the Noteholders.

            (b) The Company shall notify the holders of any Senior Debt if any
payment on the Notes is accelerated as a result of an Event of Default.

      Section 7.09. Undertaking to Pay Costs. All parties to this Indenture
agree, and each holder of any Note by his acceptance thereof shall be deemed to
have agreed, that any court may, in its discretion, require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Trustee for any action taken or omitted by it as Trustee, the filing by any
party litigant in such suit of an undertaking to pay the costs of such suit and
that such court may in its discretion assess reasonable costs, including
reasonable attorneys' fees and expenses, against any party litigant in such
suit, having due regard to the merits and good faith of the claims or defenses
made by such party litigant; provided that the provisions of this Section 7.09
(to the extent permitted by law) shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Noteholder, or group of Noteholders,
holding in the aggregate more than ten percent in principal amount of the Notes
at the time outstanding determined in accordance with Section 9.04, or to any
suit instituted by any Noteholder for the enforcement of the payment


                                       42
<PAGE>

of the principal of or premium, if any, or interest on any Note on or after the
due date expressed in such Note or to any suit for the enforcement of the right
to convert any Note in accordance with the provisions of Article 15.

                                    ARTICLE 8

                                   THE TRUSTEE

      Section 8.01. Duties and Responsibilities of Trustee. The Trustee, prior
to the occurrence of an Event of Default and after the curing of all Events of
Default which may have occurred, undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture. In case an Event of
Default has occurred (which has not been cured or waived), the Trustee shall
exercise such of the rights and powers vested in it by this Indenture, and use
the same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of his own affairs.

      No provision of this Indenture shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act or
its own willful misconduct, except that:

                        (a) prior to the occurrence of an Event of Default and
      after the curing or waiving of all Events of Default which may have
      occurred:

                        (i) the duties and obligations of the Trustee shall be
                  determined solely by the express provisions of this Indenture
                  and the Trust Indenture Act, and the Trustee shall not be
                  liable except for the performance of such duties and
                  obligations as are specifically set forth in this Indenture
                  and no implied covenants or obligations shall be read into
                  this Indenture and the Trust Indenture Act against the
                  Trustee; and

                        (ii) in the absence of bad faith and willful misconduct
                  on the part of the Trustee, the Trustee may conclusively rely
                  as to the truth of the statements and the correctness of the
                  opinions expressed therein, upon any certificates or opinions
                  furnished to the Trustee and conforming to the requirements of
                  this Indenture; but, in the case of any such certificates or
                  opinions which by any provisions hereof are specifically
                  required to be furnished to the Trustee, the Trustee shall be
                  under a duty to examine the same to determine whether or not
                  they conform to the requirements of this Indenture;

                        (b) the Trustee shall not be liable for any error of
      judgment made in good faith by a Responsible Officer or Officers of the
      Trustee, unless the Trustee was negligent in ascertaining the pertinent
      facts;

                        (c) the Trustee shall not be liable with respect to any
      action taken or omitted to be taken by it in good faith in accordance with
      the written direction of the holders of not less than a majority in
      principal amount of the Notes at the time outstanding determined as
      provided in Section 9.04 relating to the time, method and place


                                       43

<PAGE>

      of conducting any proceeding for any remedy available to the Trustee, or
      exercising any trust or power conferred upon the Trustee, under this
      Indenture;

                        (d) whether or not therein provided, every provision of
      this Indenture relating to the conduct or affecting the liability of, or
      affording protection to, the Trustee shall be subject to the provisions of
      this Section;

                        (e) the Trustee shall not be liable in respect of any
      payment (as to the correctness of amount, entitlement to receive or any
      other matters relating to payment) or notice effected by the Company or
      any paying agent or any records maintained by any co-registrar with
      respect to the Notes;

                        (f) if any party fails to deliver a notice relating to
      an event the fact of which, pursuant to this Indenture, requires notice to
      be sent to the Trustee, the Trustee may conclusively rely on its failure
      to receive such notice as reason to act as if no such event occurred; and

                        (g) the Trustee shall not be deemed to have knowledge of
      any Event of Default hereunder unless it shall have been notified in
      writing of such Event of Default by the Company or the holders of at least
      10% in aggregate principal amount of the Notes.

      None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.

      Section 8.02. Reliance on Documents, Opinions, Etc. Except as otherwise
provided in Section 8.01:

            (a) the Trustee may conclusively rely and shall be protected in
      acting upon any resolution, certificate, statement, instrument, opinion,
      report, notice, request, consent, order, bond, debenture, note, coupon or
      other paper or document (whether in its original or facsimile form)
      believed by it in good faith to be genuine and to have been signed or
      presented by the proper party or parties;

            (b) any request, direction, order or demand of the Company mentioned
      herein shall be sufficiently evidenced by an Officers' Certificate (unless
      other evidence in respect thereof be herein specifically prescribed); and
      any resolution of the Board of Directors may be evidenced to the Trustee
      by a copy thereof certified by the Secretary or an Assistant Secretary of
      the Company;

            (c) the Trustee may consult with counsel of its own selection and
      any advice or Opinion of Counsel shall be full and complete authorization
      and protection in respect of any action taken or omitted by it hereunder
      in good faith and in accordance with such advice or Opinion of Counsel;


                                       44
<PAGE>

            (d) the Trustee shall be under no obligation to exercise any of the
      rights or powers vested in it by this Indenture at the request, order or
      direction of any of the Noteholders pursuant to the provisions of this
      Indenture, unless such Noteholders shall have offered to the Trustee
      reasonable security or indemnity satisfactory to it against the costs,
      expenses and liabilities which may be incurred therein or thereby;

            (e) the Trustee shall not be bound to make any investigation into
      the facts or matters stated in any resolution, certificate, statement,
      instrument, opinion, report, notice, request, direction, consent, order,
      bond, debenture or other paper or document, but the Trustee may make such
      further inquiry or investigation into such facts or matters as it may see
      fit, and, if the Trustee shall determine to make such further inquiry or
      investigation, it shall be entitled to examine the books, records and
      premises of the Company, personally or by agent or attorney;

            (f) the Trustee may execute any of the trusts or powers hereunder or
      perform any duties hereunder either directly or by or through agents or
      attorneys and the Trustee shall not be responsible for any misconduct or
      negligence on the part of any agent or attorney appointed by it with due
      care hereunder;

            (g) the Trustee shall not be liable for any action taken, suffered
      or omitted to be taken by it in good faith and reasonably believed by it
      to be authorized or within the discretion or rights or powers conferred
      upon it by this Indenture;

            (h) the rights, privileges, protections, immunities and benefits
      given to the Trustee, including, without limitation, its right to be
      indemnified, are extended to, and shall be enforceable by, the Trustee in
      each of its capacities hereunder, and each agent, custodian and other
      Person employed to act hereunder; and

            (i) the Trustee may request that the Company deliver an Officers'
      Certificate setting forth the names of individuals and/or titles of
      officers authorized at such time to take specified actions pursuant to
      this Indenture, which Officers' Certificate may be signed by any person
      authorized to sign an Officers' Certificate, including any person
      specified as so authorized in any such certificate previously delivered
      and not superseded.

      Section 8.03. No Responsibility for Recitals, Etc. The recitals contained
herein and in the Notes (except in the Trustee's certificate of authentication)
shall be taken as the statements of the Company, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Notes. The Trustee shall not be accountable for the use or application by the
Company of any Notes or the proceeds of any Notes authenticated and delivered by
the Trustee in conformity with the provisions of this Indenture.

      Section 8.04. Trustee, Paying Agents, Conversion Agents or Registrar May
Own Notes. The Trustee, any paying agent, any conversion agent or Note
registrar, in its individual or any other capacity, may become the owner or
pledgee of Notes with the same rights it would have if it were not Trustee,
paying agent, conversion agent or Note registrar.


                                       45

<PAGE>
         Section 8.05. Monies to Be Held in Trust. Subject to the provisions of
Section 13.04, all monies received by the Trustee shall, until used or applied
as herein provided, be held in trust for the purposes for which they were
received. Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
may be agreed in writing from time to time by the Company and the Trustee.

         Section 8.06. Compensation and Expenses of Trustee. The Company
covenants and agrees to pay to the Trustee from time to time, and the Trustee
shall be entitled to, such compensation for all services rendered by it
hereunder in any capacity (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust) as mutually agreed
to from time to time in writing between the Company and the Trustee, and the
Company will pay or reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances reasonably incurred or made by the Trustee
in accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its counsel and of
all Persons not regularly in its employ) except any such expense, disbursement
or advance as may arise from its negligence, willful misconduct, recklessness or
bad faith. The Company also covenants to indemnify the Trustee and any
predecessor Trustee (or any officer, director or employee of the Trustee), in
any capacity under this Indenture and its agents and any authenticating agent
for, and to hold them harmless against, any and all loss, liability, damage,
claim or expense including taxes (other than taxes based on the income of the
Trustee) incurred without negligence, willful misconduct, recklessness or bad
faith on the part of the Trustee or such officers, directors, employees and
agent or authenticating agent, as the case may be, and arising out of or in
connection with the acceptance or administration of this trust or in any other
capacity hereunder, including the costs and expenses of defending themselves
against any claim (whether asserted by the Company, any holder or any other
Person) of liability in the premises. The obligations of the Company under this
Section 8.06 to compensate or indemnify the Trustee and to pay or reimburse the
Trustee for expenses, disbursements and advances shall be secured by a lien
prior to that of the Notes upon all property and funds held or collected by the
Trustee as such, except funds held in trust for the benefit of the holders of
particular Notes. The obligation of the Company under this Section shall survive
the satisfaction and discharge of this Indenture.

         When the Trustee and its agents and any authenticating agent incur
expenses or render services after an Event of Default specified in Section 7.01
(d) or (e) with respect to the Company occurs, the expenses and the compensation
for the services are intended to constitute expenses of administration under any
bankruptcy, insolvency or similar laws.

         Section 8.07. Officers' Certificate as Evidence. Except as otherwise
provided in Section 8.01, whenever in the administration of the provisions of
this Indenture the Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking or omitting any action hereunder, such
matter (unless other evidence in respect thereof be herein specifically
prescribed) may, in the absence of bad faith or willful misconduct on the part
of the Trustee, be deemed to be conclusively proved and established by an
Officers' Certificate delivered to the Trustee.


                                       46
<PAGE>
         Section 8.08. Conflicting Interests of Trustee. If the Trustee has or
shall acquire a conflicting interest within the meaning of the Trust Indenture
Act, the Trustee shall either eliminate such interest or resign, to the extent
and in the manner provided by, and subject to the provisions of, the Trust
Indenture Act and this Indenture.

         Section 8.09. Eligibility of Trustee. There shall at all times be a
Trustee hereunder which shall be a Person that is eligible pursuant to the Trust
Indenture Act to act as such and has a combined capital and surplus of at least
$50,000,000 (or if such Person is a member of a bank holding company system, its
bank holding company shall have a combined capital and surplus of at least
$50,000,000). If such Person publishes reports of condition at least annually,
pursuant to law or to the requirements of any supervising or examining
authority, then for the purposes of this Section the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Trustee shall cease to be eligible in accordance with the provisions of this
Section 8.09, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.

         Section 8.10. Resignation or Removal of Trustee. (a) The Trustee may at
any time resign by giving written notice of such resignation to the Company and
to the holders of Notes. Upon receiving such notice of resignation, the Company
shall promptly appoint a successor trustee by written instrument, in duplicate,
executed by order of the Board of Directors, one copy of which instrument shall
be delivered to the resigning Trustee and one copy to the successor trustee. If
no successor trustee shall have been so appointed and have accepted appointment
sixty (60) days after the mailing of such notice of resignation to the
Noteholders, the resigning Trustee may, upon ten (10) Business Days' notice to
the Company and the Noteholders, appoint a successor identified in such notice
or may petition, at the expense of the Company, any court of competent
jurisdiction for the appointment of a successor trustee, or, if any Noteholder
who has been a bona fide holder of a Note or Notes for at least six (6) months
may, subject to the provisions of Section 7.09, on behalf of himself and all
others similarly situated, petition any such court for the appointment of a
successor trustee. Such court may thereupon, after such notice, if any, as it
may deem proper and prescribe, appoint a successor trustee.

         (b)      In case at any time any of the following shall occur:

         (i)      the Trustee shall fail to comply with Section 8.08 after
written request therefor by the Company or by any Noteholder who has been a bona
fide holder of a Note or Notes for at least six (6) months; or

         (ii)     the Trustee shall cease to be eligible in accordance with the
provisions of Section 8.09 and shall fail to resign after written request
therefor by the Company or by any such Noteholder; or

         (iii)    the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its
property shall be appointed, or any public officer shall take charge or control
of the Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation;


                                       47
<PAGE>
then, in any such case, the Company may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, executed by order of the
Board of Directors, one copy of which instrument shall be delivered to the
Trustee so removed and one copy to the successor trustee, or, subject to the
provisions of Section 7.09, any Noteholder who has been a bona fide holder of a
Note or Notes for at least six (6) months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor trustee; provided that
if no successor Trustee shall have been appointed and have accepted appointment
sixty (60) days after either the Company or the Noteholders has removed the
Trustee, or the Trustee resigns, the Trustee so removed may petition, at the
expense of the Company, any court of competent jurisdiction for an appointment
of a successor trustee. Such court may thereupon, after such notice, if any, as
it may deem proper and prescribe, remove the Trustee and appoint a successor
trustee.

         (c)      The holders of a majority in aggregate principal amount of the
Notes at the time outstanding may at any time remove the Trustee and nominate a
successor trustee which shall be deemed appointed as successor trustee unless,
within ten (10) days after notice to the Company of such nomination, the Company
objects thereto, in which case the Trustee so removed or any Noteholder, or if
such Trustee so removed or any Noteholder fails to act, the Company, upon the
terms and conditions and otherwise as in Section 8.10(a) provided, may petition
any court of competent jurisdiction for an appointment of a successor trustee.

         (d)      Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section 8.10 shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 8.11.

         Section 8.11. Acceptance by Successor Trustee. Any successor trustee
appointed as provided in Section 8.10 shall execute, acknowledge and deliver to
the Company and to its predecessor trustee an instrument accepting such
appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee, without
any further act, deed or conveyance, shall become vested with all the rights,
powers, duties and obligations of its predecessor hereunder, with like effect as
if originally named as trustee herein; but, nevertheless, on the written request
of the Company or of the successor trustee, the trustee ceasing to act shall,
upon payment of any amount then due it pursuant to the provisions of Section
8.06, execute and deliver an instrument transferring to such successor trustee
all the rights and powers of the trustee so ceasing to act. Upon request of any
such successor trustee, the Company shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to such successor
trustee all such rights and powers. Any trustee ceasing to act shall,
nevertheless, retain a lien upon all property and funds held or collected by
such trustee as such, except for funds held in trust for the benefit of holders
of particular Notes, to secure any amounts then due it pursuant to the
provisions of Section 8.06.

         No successor trustee shall accept appointment as provided in this
Section 8.11 unless, at the time of such acceptance, such successor trustee
shall be qualified under the provisions of Section 8.08 and be eligible under
the provisions of Section 8.09.

         Upon acceptance of appointment by a successor trustee as provided in
this Section 8.11, the Company (or the former trustee, at the written direction
of the Company) shall mail or cause


                                       48
<PAGE>
to be mailed notice of the succession of such trustee hereunder to the holders
of Notes at their addresses as they shall appear on the Note register. If the
Company fails to mail such notice within ten (10) days after acceptance of
appointment by the successor trustee, the successor trustee shall cause such
notice to be mailed at the expense of the Company.

         Section 8.12. Succession by Merger. Any corporation into which the
Trustee may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any corporation succeeding to all or substantially
all of the corporate trust business of the Trustee (including any trust created
by this Indenture), shall be the successor to the Trustee hereunder without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that in the case of any corporation succeeding to all
or substantially all of the corporate trust business of the Trustee, such
corporation shall be qualified under the provisions of Section 8.08 and eligible
under the provisions of Section 8.09.

         In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture, any of the Notes shall have been authenticated
but not delivered, any such successor to the Trustee may adopt the certificate
of authentication of any predecessor trustee or authenticating agent appointed
by such predecessor trustee, and deliver such Notes so authenticated; and in
case at that time any of the Notes shall not have been authenticated, any
successor to the Trustee or any authenticating agent appointed by such successor
trustee may authenticate such Notes in the name of the successor trustee; and in
all such cases such certificates shall have the full force that is provided in
the Notes or in this Indenture; provided that the right to adopt the certificate
of authentication of any predecessor Trustee or authenticate Notes in the name
of any predecessor Trustee shall apply only to its successor or successors by
merger, conversion or consolidation.

         Section 8.13. Preferential Collection of Claims. If and when the
Trustee shall be or become a creditor of the Company (or any other obligor upon
the Notes), the Trustee shall be subject to the provisions of the Trust
Indenture Act regarding the collection of the claims against the Company (or any
such other obligor).

                                    ARTICLE 9

                                 THE NOTEHOLDERS

         Section 9.01. Action by Noteholders. Whenever in this Indenture it is
provided that the holders of a specified percentage in aggregate principal
amount of the Notes may take any action (including the making of any demand or
request, the giving of any notice, consent or waiver or the taking of any other
action), the fact that at the time of taking any such action, the holders of
such specified percentage have joined therein may be evidenced (a) by any
instrument or any number of instruments of similar tenor executed by Noteholders
in person or by agent or proxy appointed in writing, or (b) by the record of the
holders of Notes voting in favor thereof at any meeting of Noteholders duly
called and held in accordance with the provisions of Article 10, or (c) by a
combination of such instrument or instruments and any such record of such a
meeting of Noteholders. Whenever the Company or the Trustee solicits the taking
of any action by the holders of the Notes, the Company or the Trustee may fix in
advance of such solicitation, a date


                                       49
<PAGE>
as the record date for determining holders entitled to take such action. The
record date shall be not more than fifteen (15) days prior to the date of
commencement of solicitation of such action.

         Section 9.02. Proof of Execution by Noteholders. Subject to the
provisions of Sections 8.01, 8.02 and 10.05, proof of the execution of any
instrument by a Noteholder or its agent or proxy shall be sufficient if made in
accordance with such reasonable rules and regulations as may be prescribed by
the Trustee or in such manner as shall be satisfactory to the Trustee. The
holding of Notes shall be proved by the registry of such Notes or by a
certificate of the Note registrar.

         The record of any Noteholders' meeting shall be proved in the manner
provided in Section 10.06.

         Section 9.03. Who Are Deemed Absolute Owners. The Company, the Trustee,
any paying agent, any conversion agent and any Note registrar may deem the
Person in whose name such Note shall be registered upon the Note register to be,
and may treat it as, the absolute owner of such Note (whether or not such Note
shall be overdue and notwithstanding any notation of ownership or other writing
thereon made by any Person other than the Company or any Note registrar) for the
purpose of receiving payment of or on account of the principal of, premium, if
any, and interest on such Note, for conversion of such Note and for all other
purposes; and neither the Company nor the Trustee nor any paying agent nor any
conversion agent nor any Note registrar shall be affected by any notice to the
contrary. All such payments so made to any holder for the time being, or upon
his order, shall be valid, and, to the extent of the sum or sums so paid,
effectual to satisfy and discharge the liability for monies payable upon any
such Note.

         Section 9.04. Company-owned Notes Disregarded. In determining whether
the holders of the requisite aggregate principal amount of Notes have concurred
in any direction, consent, waiver or other action under this Indenture, Notes
which are owned by the Company or any other obligor on the Notes or any
Affiliate of the Company or any other obligor on the Notes shall be disregarded
and deemed not to be outstanding for the purpose of any such determination;
provided that for the purposes of determining whether the Trustee shall be
protected in relying on any such direction, consent, waiver or other action,
only Notes which a Responsible Officer knows are so owned shall be so
disregarded. Notes so owned which have been pledged in good faith may be
regarded as outstanding for the purposes of this Section 9.04 if the pledgee
shall establish to the satisfaction of the Trustee the pledgee's right to vote
such Notes and that the pledgee is not the Company, any other obligor on the
Notes or any Affiliate of the Company or any such other obligor. In the case of
a dispute as to such right, any decision by the Trustee taken upon the advice of
counsel shall be full protection to the Trustee. Upon request of the Trustee,
the Company shall furnish to the Trustee promptly an Officers' Certificate
listing and identifying all Notes, if any, known by the Company to be owned or
held by or for the account of any of the above described Persons, and, subject
to Section 8.01, the Trustee shall be entitled to accept such Officers'
Certificate as conclusive evidence of the facts therein set forth and of the
fact that all Notes not listed therein are outstanding for the purpose of any
such determination.

         Section 9.05. Revocation of Consents, Future Holders Bound. At any time
prior to (but not after) the evidencing to the Trustee, as provided in Section
9.01, of the taking of any action by the holders of the percentage in aggregate
principal amount of the Notes specified in this


                                       50
<PAGE>
Indenture in connection with such action, any holder of a Note which is shown by
the evidence to be included in the Notes the holders of which have consented to
such action may, by filing written notice with the Trustee at its Corporate
Trust Office and upon proof of holding as provided in Section 9.02, revoke such
action so far as concerns such Note. Except as aforesaid, any such action taken
by the holder of any Note shall be conclusive and binding upon such holder and
upon all future holders and owners of such Note and of any Notes issued in
exchange or substitution therefor, irrespective of whether any notation in
regard thereto is made upon such Note or any Note issued in exchange or
substitution therefor.

                                   ARTICLE 10

                             MEETINGS OF NOTEHOLDERS

         Section 10.01. Purpose of Meetings. A meeting of Noteholders may be
called at any time and from time to time pursuant to the provisions of this
Article 10 for any of the following purposes:

         (1)      to give any notice to the Company or to the Trustee or to give
any directions to the Trustee permitted under this Indenture, or to consent to
the waiving of any default or Event of Default hereunder and its consequences,
or to take any other action authorized to be taken by Noteholders pursuant to
any of the provisions of Article 7;

         (2)      to remove the Trustee and nominate a successor trustee
pursuant to the provisions of Article 8;

         (3)      to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 11.02; or

         (4)      to take any other action authorized to be taken by or on
behalf of the holders of any specified aggregate principal amount of the Notes
under any other provision of this Indenture or under applicable law.

         Section 10.02. Call of Meetings by Trustee. The Trustee may at any time
call a meeting of Noteholders to take any action specified in Section 10.01, to
be held at such time and at such place as the Trustee shall determine. Notice of
every meeting of the Noteholders, setting forth the time and the place of such
meeting and in general terms the action proposed to be taken at such meeting and
the establishment of any record date pursuant to Section 9.01, shall be mailed
to holders of Notes at their addresses as they shall appear on the Note
register. Such notice shall also be mailed to the Company. Such notices shall be
mailed not less than twenty (20) nor more than ninety (90) days prior to the
date fixed for the meeting.

         Any meeting of Noteholders shall be valid without notice if the holders
of all Notes then outstanding are present in person or by proxy or if notice is
waived before or after the meeting by the holders of all Notes outstanding, and
if the Company and the Trustee are either present by duly authorized
representatives or have, before or after the meeting, waived notice.


                                       51
<PAGE>
         Section 10.03. Call of Meetings by Company or Noteholders. In case at
any time the Company, pursuant to a resolution of its Board of Directors, or the
holders of at least ten percent (10%) in aggregate principal amount of the Notes
then outstanding, shall have requested the Trustee to call a meeting of
Noteholders, by written request setting forth in reasonable detail the action
proposed to be taken at the meeting, and the Trustee shall not have mailed the
notice of such meeting within twenty (20) days after receipt of such request,
then the Company or such Noteholders may determine the time and the place for
such meeting and may call such meeting to take any action authorized in Section
10.01, by mailing notice thereof as provided in Section 10.02.

         Section 10.04. Qualifications for Voting. To be entitled to vote at any
meeting of Noteholders a person shall (a) be a holder of one or more Notes on
the record date pertaining to such meeting or (b) be a person appointed by an
instrument in writing as proxy by a holder of one or more Notes on the record
date pertaining to such meeting. The only persons who shall be entitled to be
present or to speak at any meeting of Noteholders shall be the persons entitled
to vote at such meeting and their counsel and any representatives of the Trustee
and its counsel and any representatives of the Company and its counsel.

         Section 10.05. Regulations. Notwithstanding any other provisions of
this Indenture, the Trustee may make such reasonable regulations as it may deem
advisable for any meeting of Noteholders, in regard to proof of the holding of
Notes and of the appointment of proxies, and in regard to the appointment and
duties of inspectors of votes, the submission and examination of proxies,
certificates and other evidence of the right to vote, and such other matters
concerning the conduct of the meeting as it shall think fit.

         The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Noteholders as provided in Section 10.03, in which case the
Company or the Noteholders calling the meeting, as the case may be, shall in
like manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by vote of the holders of a majority
in principal amount of the Notes represented at the meeting and entitled to vote
at the meeting.

         Subject to the provisions of Section 9.04, at any meeting each
Noteholder or proxyholder shall be entitled to one vote for each $1,000
principal amount of Notes held or represented by him; provided that no vote
shall be cast or counted at any meeting in respect of any Note challenged as not
outstanding and ruled by the chairman of the meeting to be not outstanding. The
chairman of the meeting shall have no right to vote other than by virtue of
Notes held by him or instruments in writing as aforesaid duly designating him as
the proxy to vote on behalf of other Noteholders. Any meeting of Noteholders
duly called pursuant to the provisions of Section 10.02 or 10.03 may be
adjourned from time to time by the holders of a majority of the aggregate
principal amount of Notes represented at the meeting, whether or not
constituting a quorum, and the meeting may be held as so adjourned without
further notice.

         Section 10.06. Voting. The vote upon any resolution submitted to any
meeting of Noteholders shall be by written ballot on which shall be subscribed
the signatures of the holders of Notes or of their representatives by proxy and
the outstanding principal amount of the Notes held or represented by them. The
permanent chairman of the meeting shall appoint two


                                       52
<PAGE>
inspectors of votes who shall count all votes cast at the meeting for or against
any resolution and who shall make and file with the secretary of the meeting
their verified written reports in duplicate of all votes cast at the meeting. A
record in duplicate of the proceedings of each meeting of Noteholders shall be
prepared by the secretary of the meeting and there shall be attached to said
record the original reports of the inspectors of votes on any vote by ballot
taken thereat and affidavits by one or more persons having knowledge of the
facts setting forth a copy of the notice of the meeting and showing that said
notice was mailed as provided in Section 10.02. The record shall show the
principal amount of the Notes voting in favor of or against any resolution. The
record shall be signed and verified by the affidavits of the permanent chairman
and secretary of the meeting and one of the duplicates shall be delivered to the
Company and the other to the Trustee to be preserved by the Trustee, the latter
to have attached thereto the ballots voted at the meeting.

         Any record so signed and verified shall be conclusive evidence of the
matters therein stated.

         Section 10.07. No Delay of Rights by Meeting. Nothing contained in this
Article 10 shall be deemed or construed to authorize or permit, by reason of any
call of a meeting of Noteholders or any rights expressly or impliedly conferred
hereunder to make such call, any hindrance or delay in the exercise of any right
or rights conferred upon or reserved to the Trustee or to the Noteholders under
any of the provisions of this Indenture or of the Notes.

                                   ARTICLE 11

                             SUPPLEMENTAL INDENTURES

         Section 11.01. Supplemental Indentures Without Consent of Noteholders.
The Company, when authorized by the resolutions of the Board of Directors, and
the Trustee may, from time to time, and at any time enter into an indenture or
indentures supplemental hereto for one or more of the following purposes:

         (a)      make provision with respect to the conversion rights of the
holders of Notes pursuant to the requirements of Section 15.06 and the
redemption obligations of the Company pursuant to the requirements of Section
3.05(e);

         (b)      to convey, transfer, assign, mortgage or pledge to the Trustee
as security for the Notes, any property or assets;

         (c)      to evidence the succession of another Person to the Company,
or successive successions, and the assumption by the successor Person of the
covenants, agreements and obligations of the Company pursuant to Article 12;

         (d)      to add to the covenants of the Company such further covenants,
restrictions or conditions as the Board of Directors and the Trustee shall
consider to be for the benefit of the holders of Notes, and to make the
occurrence, or the occurrence and continuance, of a default in any such
additional covenants, restrictions or conditions a default or an Event of
Default permitting the enforcement of all or any of the several


                                       53
<PAGE>
remedies provided in this Indenture as herein set forth; provided that in
respect of any such additional covenant, restriction or condition, such
supplemental indenture may provide for a particular period of grace after
default (which period may be shorter or longer than that allowed in the case of
other defaults) or may provide for an immediate enforcement upon such default or
may limit the remedies available to the Trustee upon such default;

         (e)      to provide for the issuance under this Indenture of Notes in
coupon form (including Notes registrable as to principal only) and to provide
for exchangeability of such Notes with the Notes issued hereunder in fully
registered form and to make all appropriate changes for such purpose;

         (f)      to cure any ambiguity or to correct or supplement any
provision contained herein or in any supplemental indenture that may be
defective or inconsistent with any other provision contained herein or in any
supplemental indenture, or to make such other provisions in regard to matters or
questions arising under this Indenture that shall not materially adversely
affect the interests of the holders of the Notes;

         (g)      to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Notes;

         (h)      to modify, eliminate or add to the provisions of this
Indenture to such extent as shall be necessary to effect the qualifications of
this Indenture under the Trust Indenture Act, or under any similar federal
statute hereafter enacted; or

         (i)       to make any other change that does not adversely affect any
right of the holders of Notes under this Indenture.

         Upon the written request of the Company, accompanied by a copy of the
resolutions of the Board of Directors certified by its Secretary or Assistant
Secretary authorizing the execution of any supplemental indenture, the Trustee
is hereby authorized to join with the Company in the execution of any such
supplemental indenture, to make any further appropriate agreements and
stipulations that may be therein contained and to accept the conveyance,
transfer and assignment of any property thereunder, but the Trustee shall not be
obligated to, but may in its discretion, enter into any supplemental indenture
that affects the Trustee's own rights, duties or immunities under this Indenture
or otherwise.

         Any supplemental indenture authorized by the provisions of this Section
11.01 may be executed by the Company and the Trustee without the consent of the
holders of any of the Notes at the time outstanding, notwithstanding any of the
provisions of Section 11.02.

         Notwithstanding any other provision of the Indenture or the Notes, the
Registration Rights Agreement and the obligation to pay Liquidated Damages
thereunder may be amended, modified or waived in accordance with the provisions
of the Registration Rights Agreement.

         Section 11.02. Supplemental Indenture With Consent of Noteholders. With
the consent (evidenced as provided in Article 9) of the holders of at least a
majority in aggregate principal


                                       54
<PAGE>
amount of the Notes at the time outstanding, the Company, when authorized by the
resolutions of the Board of Directors, and the Trustee may, from time to time
and at any time, enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Indenture or any supplemental indenture or of
modifying in any manner the rights of the holders of the Notes; provided that no
such supplemental indenture shall (i) extend the fixed maturity of any Note, or
reduce the rate or extend the time of payment of interest thereon, or reduce the
principal amount thereof or premium, if any, thereon, or reduce any amount
payable on redemption or repurchase thereof, or impair the right of any
Noteholder to institute suit for the payment thereof, or make the principal
thereof or interest or premium, if any, thereon payable in any coin or currency
other than that provided in the Notes, or change the obligation of the Company
to redeem any Note on a redemption date in a manner adverse to the holders of
Notes, or change the obligation of the Company to redeem any Note upon the
happening of a Fundamental Change in a manner adverse to the holders of Notes,
or change the obligation of the Company to repurchase any Note on a Repurchase
Date in a manner adverse to the holders of Notes, or impair the right to convert
the Notes into Common Stock subject to the terms set forth herein, including
Section 15.06, or modify, in any material respect, the subordination provisions
set forth in Article 16 in a manner adverse to the holders of Notes, in each
case, without the consent of the holder of each Note so affected, or modify any
of the provisions of this Section 11.02 or Section 7.07, except to increase any
such percentage or to provide that certain other provisions of this Indenture
cannot be modified or waived without the consent of the holder of each Note so
affected, or change any obligation of the Company to maintain an office or
agency in the places and for the purposes set forth in Section 5.01, or reduce
the quorum or voting requirements set forth in Article 10 or (ii) reduce the
aforesaid percentage of Notes, the holders of which are required to consent to
any such supplemental indenture, without the consent of the holders of all Notes
then outstanding.

         Upon the written request of the Company, accompanied by a copy of the
resolutions of the Board of Directors certified by its Secretary or Assistant
Secretary authorizing the execution of any such supplemental indenture, and upon
the filing with the Trustee of evidence of the consent of Noteholders as
aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise, in which
case the Trustee may in its discretion, but shall not be obligated to, enter
into such supplemental indenture.

         It shall not be necessary for the consent of the Noteholders under this
Section 11.02 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.

         Section 11.03. Effect of Supplemental Indenture. Any supplemental
indenture executed pursuant to the provisions of this Article 11 shall comply
with the Trust Indenture Act, as then in effect, provided that this Section
11.03 shall not require such supplemental indenture or the Trustee to be
qualified under the Trust Indenture Act prior to the time such qualification is
in fact required under the terms of the Trust Indenture Act or the Indenture has
been qualified under the Trust Indenture Act, nor shall it constitute any
admission or acknowledgment by any party to such supplemental indenture that any
such qualification is required prior to the time such qualification is in fact
required under the terms of the Trust Indenture Act or the Indenture has


                                       55
<PAGE>
been qualified under the Trust Indenture Act. Upon the execution of any
supplemental indenture pursuant to the provisions of this Article 11, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith and the respective rights, limitation of rights, obligations, duties
and immunities under this indenture of the Trustee, the Company and the holders
of Notes shall thereafter be determined, exercised and enforced hereunder,
subject in all respects to such modifications and amendments and all the terms
and conditions of any such supplemental indenture shall be and be deemed to be
part of the terms and conditions of this Indenture for any and all purposes.

         Section 11.04. Notation on Notes. Notes authenticated and delivered
after the execution of any supplemental indenture pursuant to the provisions of
this Article 11 may bear a notation in form approved by the Trustee as to any
matter provided for in such supplemental indenture. If the Company or the
Trustee shall so determine, new Notes so modified as to conform, in the opinion
of the Trustee and the Board of Directors, to any modification of this Indenture
contained in any such supplemental indenture may, at the Company's expense, be
prepared and executed by the Company, authenticated by the Trustee (or an
authenticating agent duly appointed by the Trustee pursuant to Section 17.10)
and delivered in exchange for the Notes then outstanding, upon surrender of such
Notes then outstanding.

         Section 11.05. Evidence of Compliance of Supplemental Indenture to Be
Furnished to Trustee. Prior to entering into any supplemental indenture, the
Trustee shall be provided with an Officers' Certificate and an Opinion of
Counsel as conclusive evidence that any supplemental indenture executed pursuant
hereto complies with the requirements of this Article 11.

                                   ARTICLE 12

                CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE

         Section 12.01. Company May Consolidate on Certain Terms. Subject to the
provisions of Section 12.02, the Company shall not consolidate or merge with or
into any other Person or Persons (whether or not affiliated with the Company),
nor shall the Company or its successor or successors be a party or parties to
successive consolidations or mergers, nor shall the Company sell, convey,
transfer or lease the property and assets of the Company substantially as an
entirety, to any other Person (whether or not affiliated with the Company),
unless: (i) the Company is the surviving Person, or the resulting, surviving or
transferee Person is a corporation organized and existing under the laws of the
United States of America, any state thereof or the District of Columbia; (ii)
upon any such consolidation, merger, sale, conveyance, transfer or lease, the
due and punctual payment of the principal of and premium, if any, and interest
on all of the Notes, according to their tenor and the due and punctual
performance and observance of all of the covenants and conditions of this
Indenture to be performed by the Company, shall be expressly assumed, by
supplemental indenture satisfactory in form to the Trustee, executed and
delivered to the Trustee by the Person (if other than the Company) formed by
such consolidation, or into which the Company shall have been merged, or by the
Person that shall have acquired or leased such property, and such supplemental
indenture shall provide for the applicable conversion rights set forth in
Section 15.06; and (iii) immediately after giving effect to the transaction
described above, no Event of Default, and no event which, after notice or lapse
of time or both, would become an Event of Default, shall have happened and be
continuing.


                                       56
<PAGE>
         Section 12.02. Successor to Be Substituted. In case of any such
consolidation, merger, sale, conveyance, transfer or lease and upon the
assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the due and
punctual payment of the principal of and premium, if any, and interest on all of
the Notes and the due and punctual performance of all of the covenants and
conditions of this Indenture to be performed by the Company; such successor
Person shall succeed to and be substituted for the Company, with the same effect
as if it had been named herein as the party of this first part. Such successor
Person thereupon may cause to be signed, and may issue either in its own name or
in the name of Steel Dynamics, Inc. any or all of the Notes, issuable hereunder
that theretofore shall not have been signed by the Company and delivered to the
Trustee; and, upon the order of such successor Person instead of the Company and
subject to all the terms, conditions and limitations in this Indenture
prescribed, the Trustee shall authenticate and shall deliver, or cause to be
authenticated and delivered, any Notes that previously shall have been signed
and delivered by the officers of the Company to the Trustee for authentication,
and any Notes that such successor Person thereafter shall cause to be signed and
delivered to the Trustee for that purpose. All the Notes so issued shall in all
respects have the same legal rank and benefit under this Indenture as the Notes
theretofore or thereafter issued in accordance with the terms of this Indenture
as though all of such Notes had been issued at the date of the execution hereof.
In the event of any such consolidation, merger, sale, conveyance, transfer or
lease, the Person named as the "COMPANY" in the first paragraph of this
Indenture or any successor that shall thereafter have become such in the manner
prescribed in this Article 12 may be dissolved, wound up and liquidated at any
time thereafter and such Person shall be released from its liabilities as
obligor and maker of the Notes and from its obligations under this Indenture.

         In case of any such consolidation, merger, sale, conveyance, transfer
or lease, such changes in phraseology and form (but not in substance) may be
made in the Notes thereafter to be issued as may be appropriate.

         Section 12.03. Opinion of Counsel to Be Given Trustee. The Trustee
shall receive an Officers' Certificate and an Opinion of Counsel as conclusive
evidence that any such consolidation, merger, sale, conveyance, transfer or
lease and any such assumption complies with the provisions of this Article 12.

                                   ARTICLE 13

                     SATISFACTION AND DISCHARGE OF INDENTURE

         Section 13.01. Discharge of Indenture. When (a) the Company shall
deliver to the Trustee for cancellation all Notes theretofore authenticated
(other than any Notes that have been destroyed, lost or stolen and in lieu of or
in substitution for which other Notes shall have been authenticated and
delivered) and not theretofore canceled, or (b) all the Notes not theretofore
canceled or delivered to the Trustee for cancellation shall have become due and
payable, or are by their terms to become due and payable within one year or are
to be called for redemption within one year under arrangements satisfactory to
the Trustee for the giving of notice of redemption, and the Company shall
deposit with the Trustee, in trust, funds sufficient to pay at maturity or upon
redemption of all of the Notes (other than any Notes that shall have been
mutilated, destroyed, lost or stolen and in lieu of or in substitution for which
other Notes shall


                                       57
<PAGE>
have been authenticated and delivered) not theretofore canceled or delivered to
the Trustee for cancellation, including principal and premium, if any, and
interest due or to become due to such date of maturity or redemption date, as
the case may be, accompanied by a verification report, as to the sufficiency of
the deposited amount, from an independent certified accountant or other
financial professional satisfactory to the Trustee, and if the Company shall
also pay or cause to be paid all other sums payable hereunder by the Company,
then this Indenture shall cease to be of further effect (except as to (i)
remaining rights of registration of transfer, substitution and exchange and
conversion of Notes, (ii) rights hereunder of Noteholders to receive payments of
principal of and premium, if any, and interest on, the Notes and the other
rights, duties and obligations of Noteholders, as beneficiaries hereof with
respect to the amounts, if any, so deposited with the Trustee and (iii) the
rights, obligations and immunities of the Trustee hereunder), and the Trustee,
on written demand of the Company accompanied by an Officers' Certificate and an
Opinion of Counsel as required by Section 17.04 and at the cost and expense of
the Company, shall execute proper instruments acknowledging satisfaction of and
discharging this Indenture; the Company, however, hereby agrees to reimburse the
Trustee for any costs or expenses thereafter reasonably and properly incurred by
the Trustee and to compensate the Trustee for any services thereafter reasonably
and properly rendered by the Trustee in connection with this Indenture or the
Notes.

         Section 13.02. Deposited Monies to Be Held in Trust by Trustee. Subject
to Section 13.04, all monies deposited with the Trustee pursuant to Section
13.01 shall be held in trust for the sole benefit of the Noteholders, and such
monies shall be applied by the Trustee to the payment, either directly or
through any paying agent (including the Company if acting as its own paying
agent), to the holders of the particular Notes for the payment or redemption of
which such monies have been deposited with the Trustee, of all sums due and to
become due thereon for principal and interest and premium, if any.

         Section 13.03. Paying Agent to Repay Monies Held. Upon the satisfaction
and discharge of this Indenture, all monies then held by any paying agent of the
Notes (other than the Trustee) shall, upon written request of the Company, be
repaid to it or paid to the Trustee, and thereupon such paying agent shall be
released from all further liability with respect to such monies.

         Section 13.04. Return of Unclaimed Monies. Subject to the requirements
of applicable law, any monies deposited with or paid to the Trustee for payment
of the principal of, premium, if any, or interest on Notes and not applied but
remaining unclaimed by the holders of Notes for two years after the date upon
which the principal of, premium, if any, or interest on such Notes, as the case
may be, shall have become due and payable, shall be repaid to the Company by the
Trustee on demand and all liability of the Trustee shall thereupon cease with
respect to such monies; and the holder of any of the Notes shall thereafter look
only to the Company for any payment that such holder may be entitled to collect
unless an applicable abandoned property law designates another Person.

         Section 13.05. Reinstatement. If the Trustee or the paying agent is
unable to apply any money in accordance with Section 13.02 by reason of any
order or judgment of any court or governmental authority enjoining, restraining
or otherwise prohibiting such application, the Company's obligations under this
Indenture and the Notes shall be revived and reinstated as though no deposit had
occurred pursuant to Section 13.01 until such time as the Trustee or the


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<PAGE>
paying agent is permitted to apply all such money in accordance with Section
13.02; provided that if the Company makes any payment of interest on or
principal of any Note following the reinstatement of its obligations, the
Company shall be subrogated to the rights of the holders of such Notes to
receive such payment from the money held by the Trustee or paying agent.

                                   ARTICLE 14

         IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS

         SECTION 14.01. Indenture and Notes Solely Corporate Obligations. No
recourse for the payment of the principal of or premium, if any, or interest on
any Note, or for any claim based thereon or otherwise in respect thereof, and no
recourse under or upon any obligation, covenant or agreement of the Company in
this Indenture or in any supplemental indenture or in any Note, or because of
the creation of any indebtedness represented thereby, shall be had against any
incorporator, stockholder, employee, agent, officer, director or subsidiary, as
such, past, present or future, of the Company or of any successor corporation,
either directly or through the Company or any successor corporation, whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise; it being expressly understood that all such
liability is hereby expressly waived and released as a condition of, and as a
consideration for, the execution of this Indenture and the issue of the Notes.

                                   ARTICLE 15

                               CONVERSION OF NOTES

         SECTION 15.01. Right to Convert. (a) Subject to and upon compliance
with the provisions of this Indenture, prior to 5:00 p.m. (New York City time)
on December 15, 2012, the holder of any Note shall have the right, at such
holder's option, .to convert the principal amount of the Note, or any portion of
such principal amount which is a multiple of $1,000, into fully paid and
non-assessable shares of Common Stock (as such shares shall then be constituted)
at the Conversion Rate in effect at such time, by surrender of the Note so to be
converted in whole or in part, together with any required funds, under the
circumstances described in this Section 15.01 and in the manner provided in
Section 15.02. The Notes shall be convertible only upon the occurrence of one of
the following events:

         (i)      at any time after the Closing Sale Price exceeds 120% of the
Conversion Price in effect for at least 20 Trading Days in the 30 consecutive
Trading Day period ending on the last Trading Day of any fiscal quarter
commencing after December 31, 2002 (it being understood for purposes of this
Section 15.01(a)(i) that the Conversion Price in effect at the close of business
on each of the 30 consecutive Trading Days should be used);

         (ii)     after the earlier of (a) the date the Notes are rated by both
Standard & Poor's Credit Market Services, a division of the McGraw-Hill
Companies, and Moody's Investor Services, Inc. and (b) January 31, 2003, during
any period that the long-term credit rating assigned to the Notes by either
Standard & Poor's or Moody's (or any successors to these entities) is "CCC" or
"Caa3", respectively, or lower, or if either of


                                       59
<PAGE>
         these rating agencies no longer rates the Notes, of if either of these
         rating agencies suspends or withdraws the rating assigned to the Notes,
         of if the Notes are not assigned a rating by both rating agencies;

         (iii)    if such Note has been called for redemption, at any time on or
         after the date the notice of redemption has been given until the close
         of business on the Business Day immediately preceding the redemption
         date; or

         (iv)     as provided in Section (b) of this Section 15.01.

         The Trustee (or other conversion agent appointed by the Company) shall,
on behalf of the Company, determine on a daily basis whether the Notes shall be
convertible as a result of the occurrence of an event specified in clause (i)
above and, if the Notes shall be so convertible, the Trustee (or other
conversion agent appointed by the Company) shall promptly deliver to the Company
and the Trustee (if the Trustee is not the conversion agent) written notice
thereof. Whenever the Notes shall become convertible pursuant to this Section
15.01, the Company or, at the Company's request, the Trustee in the name and at
the expense of the Company, shall notify the holders of the event triggering
such convertibility in the manner provided in Section 17.03, and the Company
shall also publicly announce such information and publish it on the Company's
web site. Any notice so given shall be conclusively presumed to have been duly
given, whether or not the holder receives such notice.

         (b)      In addition, if:

         (i)       (A) the Company distributes to all holders of its Common
         Stock rights or warrants entitling them (for a period expiring within
         45 days of the record date for the determination of the stockholders
         entitled to receive such distribution) to subscribe for or purchase
         shares of Common Stock, at a price per share less than the average of
         the Closing Sale Price for the ten Trading Days immediately preceding,
         but not including, the date such distribution is first publicly
         announced by the Company, or (B) the Company distributes to all holders
         of its Common Stock, cash or other assets, debt securities or rights to
         purchase its securities, where the Fair Market Value of such
         distribution per share of Common Stock exceeds 10% of the Closing Sale
         Price on the Trading Day immediately preceding the date such
         distribution is first publicly announced by the Company, then, in
         either case, the Notes may be surrendered for conversion at any time on
         and after the date that the Company gives notice to the holders of such
         distribution, which shall be not less than 20 days prior to the
         Ex-Dividend Time for such distribution, until the earlier of the close
         of business on the Business Day immediately preceding, but not
         including, the Ex-Dividend Time or the date the Company publicly
         announces that such distribution will not take place; provided that no
         adjustment to the Conversion Price or the ability of a holder of a Note
         to convert will be made if the holder will otherwise participate in
         such distribution without conversion; or

         (ii)     the Company consolidates with or merges with or into another
         Person or is a party to a binding share exchange or conveys, transfers,
         sells, leases or otherwise disposes of all or substantially all of its
         properties and assets, then the Notes may be surrendered for conversion
         at any time from and after the date fifteen (15) days prior to


                                       60
<PAGE>
         the anticipated effective date of the transaction and ending on and
         including the date fifteen (15) days after the consummation of the
         transaction. The Board of Directors shall determine the anticipated
         effective date of the transaction, and such determination shall be
         conclusive and binding on the holders and shall be publicly announced
         by the Company and posted on its web site not later than two Business
         Day prior to such 15th day.

         "EX-DIVIDEND TIME" means, with respect to any distribution on shares of
Common Stock, the first date on which the shares of Common Stock trade regular
way on the principal securities market on which the shares of Common Stock are
then traded without the right to receive such distribution.

                  (c)      A Note in respect of which a holder is electing to
exercise its option to require redemption upon a Fundamental Change pursuant to
Section 3.05 or repurchase pursuant to Section 3.06 may be converted only if
such holder withdraws its election in accordance with Section 3.05(b) or Section
3.08, respectively. A holder of Notes is not entitled to any rights of a holder
of Common Stock until such holder has converted his Notes to Common Stock, and
only to the extent such Notes are deemed to have been converted to Common Stock
under this Article 15.

         Section 15.02. Exercise of Conversion Privilege; Issuance of Common
Stock on Conversion; No Adjustment for Interest or Dividends. In order to
exercise the conversion privilege with respect to any Note in certificated form,
the Company must receive at the office or agency of the Company maintained for
that purpose or, at the option of such holder, the Corporate Trust Office, such
Note with the original or facsimile of the form entitled "CONVERSION NOTICE" on
the reverse thereof, duly completed and manually signed, together with such
Notes duly endorsed for transfer, accompanied by the funds, if any, required by
the penultimate paragraph of this Section 15.02. Such notice shall also state
the name or names (with address or addresses) in which the certificate or
certificates for shares of Common Stock which shall be issuable on such
conversion shall be issued, and shall be accompanied by transfer or similar
taxes, if required pursuant to Section 15.07.

         In order to exercise the conversion privilege with respect to any
interest in a Global Note, the beneficial holder must complete, or cause to be
completed, the appropriate instruction form for conversion pursuant to the
Depositary's bookentry conversion program, deliver, or cause to be delivered, by
book-entry delivery an interest in such Global Note, furnish appropriate
endorsements and transfer documents if required by the Company or the Trustee or
conversion agent, and pay the funds, if any, required by this Section 15.02 and
any transfer taxes if required pursuant to Section 15.07.

         As promptly as practicable after satisfaction of the requirements for
conversion set forth above, subject to compliance with any restrictions on
transfer if shares issuable on conversion are to be issued in a name other than
that of the Noteholder (as if such transfer were a transfer of the Note or Notes
(or portion thereof) so converted), the Company shall issue and shall deliver to
such Noteholder at the office or agency maintained by the Company for such
purpose pursuant to Section 5.02, a certificate or certificates for the number
of full shares of Common Stock issuable upon the conversion of such Note or
portion thereof as determined by the Company in


                                       61
<PAGE>
accordance with the provisions of this Article 15 and a check or cash in respect
of any fractional interest in respect of a share of Common Stock arising upon
such conversion, calculated by the Company as provided in Section 15.03. In case
any Note of a denomination greater than $1,000 shall be surrendered for partial
conversion, and subject to Section 2.03, the Company shall execute and the
Trustee shall authenticate and deliver to the holder of the Note so surrendered,
without charge to him, a new Note or Notes in authorized denominations in an
aggregate principal amount equal to the unconverted portion of the surrendered
Note.

         Each conversion shall be deemed to have been effected as to any such
Note (or portion thereof) on the date on which the requirements set forth above
in this Section 15.02 have been satisfied as to such Note (or portion thereof),
and the Person in whose name any certificate or certificates for shares of
Common Stock shall be issuable upon such conversion shall be deemed to have
become on said date the holder of record of the shares represented thereby;
provided that any such surrender on any date when the stock transfer books of
the Company shall be closed shall constitute the Person in whose name the
certificates are to be issued as the record holder thereof for all purposes on
the next succeeding day on which such stock transfer books are open, but such
conversion shall be at the Conversion Rate in effect on the date upon which such
Note shall be surrendered.

         Any Note or portion thereof surrendered for conversion during the
period from the close of business on the record date for any interest payment
date to the close of business on the Business Day preceding the following
interest payment date that has not been called for redemption during such period
shall be accompanied by payment, in immediately available funds or other funds
acceptable to the Company, of an amount equal to the interest otherwise payable
on such interest payment date on the principal amount being converted; provided
that no such payment need be made to the extent that there shall exist at the
time of conversion a default in the payment of interest on the Notes. Except as
provided above in this Section 15.02, no payment or other adjustment shall be
made for interest accrued on any Note converted or for dividends on any shares
issued upon the conversion of such Note as provided in this Article 15.

         Upon the conversion of an interest in a Global Note, the Trustee (or
other conversion agent appointed by the Company), or the Custodian at the
direction of the Trustee (or other conversion agent appointed by the Company),
shall make a notation on such Global Note as to the reduction in the principal
amount represented thereby. The Company shall notify the Trustee in writing of
any conversions of Notes effected through any conversion agent other than the
Trustee.

         Upon the conversion of a Note, that portion of the accrued but unpaid
interest, including accrued contingent interest, if any, and accrued Tax
Original Issue Discount attributable to the period from the issue date of the
Note to the conversion date, with respect to the converted Note shall not be
cancelled, extinguished or forfeited, but rather shall be deemed to be paid in
full to the holder thereof through delivery of the Common Stock (together with
the cash payment, if any in lieu of fractional shares) in exchange for the Note
being converted pursuant to the provisions hereof; and the fair market value of
such shares of Common Stock (together with any such cash payment in lieu of
fractional shares) shall be treated as issued, to the extent thereof, first in
exchange for and in satisfaction of our obligation to pay the principal amount
of the converted Note, the accrued but unpaid interest, including contingent
interest, if any, and accrued Tax


                                       62
<PAGE>
Original Issue Discount through the conversion date from the issue date, and the
balance, if any, of such fair market value of such Common Stock (and any such
cash payment) shall be treated as issued in exchange for and in satisfaction of
the right to convert the Note being converted pursuant to the provisions hereof.

         Section 15.03. Cash Payments in Lieu of Fractional Shares. No
fractional shares of Common Stock or scrip certificates representing fractional
shares shall be issued upon conversion of Notes. If more than one Note shall be
surrendered for conversion at one time by the same holder, the number of full
shares that shall be issuable upon conversion shall be computed on the basis of
the aggregate principal amount of the Notes (or specified portions thereof to
the extent permitted hereby) so surrendered. If any fractional share of stock
would be issuable upon the conversion of any Note or Notes, the Company shall
make an adjustment and payment therefor in cash at the current market price
thereof to the holder of Notes. The current market price of a share of Common
Stock shall be the Closing Sale Price on the last Trading Day immediately
preceding the day on which the Notes (or specified portions thereof) are deemed
to have been converted.

         Section 15.04. Conversion Rate. Each $1,000 principal amount of the
Notes shall be convertible into the number of shares of Common Stock specified
in the form of Note (herein called the "CONVERSION RATE") attached as Exhibit A
hereto, subject to adjustment as provided in this Article 15.

         Section 15.05. Adjustment of Conversion Rate. The Conversion Rate shall
be adjusted from time to time by the Company as follows:

                  (a)      In case the Company shall hereafter pay a dividend or
make a distribution to all holders of the outstanding Common Stock in shares of
Common Stock, the Conversion Rate shall be increased so that the same shall
equal the rate determined by multiplying the Conversion Rate in effect at the
opening of business on the date following the date fixed for the determination
of stockholders entitled to receive such dividend or other distribution by a
fraction,

                  (i)      the numerator of which shall be the sum of the number
         of shares of Common Stock outstanding at the close of business on the
         date fixed for the determination of stockholders entitled to receive
         such dividend or other distribution plus the total number of shares of
         Common Stock constituting such dividend or other distribution; and

                  (ii)     the denominator of which shall be the number of
         shares of Common Stock outstanding at the close of business on the date
         fixed for such determination,

such increase to become effective immediately after the opening of business on
the day following the date fixed for such determination. For the purpose of this
paragraph (a), the number of shares of Common Stock at any time outstanding
shall not include shares held in the treasury of the Company. The Company will
not pay any dividend or make any distribution on shares of Common Stock held in
the treasury of the Company. If any dividend or distribution of the type
described in this Section 15.05(a) is declared but not so paid or made, the
Conversion


                                       63
<PAGE>
Rate shall again be adjusted to the Conversion Rate that would then be in effect
if such dividend or distribution had not been declared.

                  (b)      In case the Company shall issue rights or warrants to
all holders of its outstanding shares of Common Stock entitling them (for a
period expiring within forty-five (45) days after the date fixed for
determination of stockholders entitled to receive such rights or warrants) to
subscribe for or purchase shares of Common Stock at a price per share less than
the Current Market Price on the date fixed for determination of stockholders
entitled to receive such rights or warrants, the Conversion Rate shall be
increased so that the same shall equal the rate determined by multiplying the
Conversion Rate in effect immediately prior to the date fixed for determination
of stockholders entitled to receive such rights or warrants by a fraction,

                  (i)      the numerator of which shall be the number of shares
         of Common Stock outstanding on the date fixed for determination of
         stockholders entitled to receive such rights or warrants plus the total
         number of additional shares of Common Stock offered for subscription or
         purchase, and

                  (ii)     the denominator of which shall be the sum of the
         number of shares of Common Stock outstanding at the close of business
         on the date fixed for determination of stockholders entitled to receive
         such rights or warrants plus the number of shares that the aggregate
         offering price of the total number of shares so offered would purchase
         at such Current Market Price.

         Such adjustment shall be successively made whenever any such rights or
warrants are issued, and shall become effective immediately after the opening of
business on the day following the date fixed for determination of stockholders
entitled to receive such rights or warrants. To the extent that shares of Common
Stock are not delivered after the expiration of such rights or warrants, the
Conversion Rate shall be readjusted to the Conversion Rate that would then be in
effect had the adjustments made upon the issuance of such rights or warrants
been made on the basis of delivery of only the number of shares of Common Stock
actually delivered. If such rights or warrants are not so issued, the Conversion
Rate shall again be adjusted to be the Conversion Rate that would then be in
effect if such date fixed for the determination of stockholders entitled to
receive such rights or warrants had not been fixed. In determining whether any
rights or warrants entitle the holders to subscribe for or purchase shares of
Common Stock at less than such Current Market Price, and in determining the
aggregate offering price of such shares of Common Stock, there shall be taken
into account any consideration received by the Company for such rights or
warrants and any amount payable on exercise or conversion thereof, the value of
such consideration, if other than cash, to be determined by the Board of
Directors.

         (c)      In case outstanding shares of Common Stock shall be subdivided
into a greater number of shares of Common Stock, the Conversion Rate in effect
at the opening of business on the day following the day upon which such
subdivision becomes effective shall be proportionately increased, and
conversely, in case outstanding shares of Common Stock shall be combined into a
smaller number of shares of Common Stock, the Conversion Rate in effect at the
opening of business on the day following the day upon which such combination
becomes effective shall be proportionately reduced, such increase or reduction,
as the case may be, to


                                       64
<PAGE>
become effective immediately after the opening of business on the day following
the day upon which such subdivision or combination becomes effective.

         (d)      In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock shares of any class of capital
stock of the Company or evidences of its indebtedness or assets (including
securities, but excluding any rights or warrants referred to in Section
15.05(b), and excluding any dividend or distribution (x) paid exclusively in
cash or (y) referred to in Section 15.05(a) (any of the foregoing hereinafter in
this Section 15.05(d)) called the "SECURITIES")), then, in each such case
(unless the Company elects to reserve such Securities for distribution to the
Noteholders upon the conversion of the Notes so that any such holder converting
Notes will receive upon such conversion, in addition to the shares of Common
Stock to which such holder is entitled, the amount and kind of such Securities
which such holder would have received if such holder had converted its Notes
into Common Stock immediately prior to the Record Date, the Conversion Rate
shall be increased so that the same shall be equal to the rate determined by
multiplying the Conversion Rate in effect on the Record Date with respect to
such distribution by a fraction,

                  (i)      the numerator of which shall be the Current Market
         Price on such Record Date; and

                  (ii)     the denominator of which shall be the Current Market
         Price on such Record Date less the fair market value (as determined by
         the Board of Directors, whose determination shall be conclusive, and
         described in a resolution of the Board of Directors) on the Record Date
         of the portion of the Securities so distributed applicable to one share
         of Common Stock,

such adjustment to become effective immediately prior to the opening of business
on the day following such Record Date; provided that if the then fair market
value (as so determined) of the portion of the Securities so distributed
applicable to one share of Common Stock is equal to or greater than the Current
Market Price on the Record Date, in lieu of the foregoing adjustment, adequate
provision shall be made so that each Noteholder shall have the right to receive
upon conversion the amount of Securities such holder would have received had
such holder converted each Note on the Record Date. If such dividend or
distribution is not so paid or made, the Conversion Rate shall again be adjusted
to be the Conversion Rate that would then be in effect if such dividend or
distribution had not been declared. If the Board of Directors determines the
fair market value of any distribution for purposes of this Section 15.05(d) by
reference to the actual or when issued trading market for any securities, it
must in doing so consider the prices in such market over the same period used in
computing the Current Market Price on the applicable Record Date.

         Rights or warrants distributed by the Company to all holders of Common
Stock entitling the holders thereof to subscribe for or purchase shares of the
Company's capital stock (either initially or under certain circumstances), which
rights or warrants, until the occurrence of a specified event or events
("TRIGGER EVENT"): (i) are deemed to be transferred with such shares of Common
Stock; (ii) are not exercisable; and (iii) are also issued in respect of future
issuances of Common Stock, shall be deemed not to have been distributed for
purposes of this Section 15.05 (and no adjustment to the Conversion Rate under
this Section 15.05 will be required) until


                                       65
<PAGE>
the occurrence of the earliest Trigger Event, whereupon such rights and warrants
shall be deemed to have been distributed and an appropriate adjustment (if any
is required) to the Conversion Rate shall be made under this Section 15.05(d).
If any such right or warrant, including any such existing rights or warrants
distributed prior to the date of this Indenture, are subject to events, upon the
occurrence of which such rights or warrants become exercisable to purchase
different securities, evidences of indebtedness or other assets, then the date
of the occurrence of any and each such event shall be deemed to be the date of
distribution and record date with respect to new rights or warrants with such
rights (and a termination or expiration of the existing rights or warrants
without exercise by any of the holders thereof). In addition, in the event of
any distribution (or deemed distribution) of rights or warrants, or any Trigger
Event or other event (of the type described in the preceding sentence) with
respect thereto that was counted for purposes of calculating a distribution
amount for which an adjustment to the Conversion Rate under this Section 15.05
was made, (1) in the case of any such rights or warrants that shall all have
been redeemed or repurchased without exercise by any holders thereof, the
Conversion Rate shall be readjusted upon such final redemption or repurchase to
give effect to such distribution or Trigger Event, as the case may be, as though
it were a cash distribution, equal to the per share redemption or repurchase
price received by a holder or holders of Common Stock with respect to such
rights or warrants (assuming such holder had retained such rights or warrants),
made to all holders of Common Stock as of the date of such redemption or
repurchase, and (2) in the case of such rights or warrants that shall have
expired or been terminated without exercise by any holders thereof, the
Conversion Rate shall be readjusted as if such rights and warrants had not been
issued.

         No adjustment of the Conversion Rate shall be made pursuant to this
Section 15.05(d) in respect of rights or warrants distributed or deemed
distributed on any Trigger Event to the extent that such rights or warrants are
actually distributed, or reserved by the Company for distribution to holders of
Notes upon conversion by such holders of Notes to Common Stock.

         For purposes of this Section 15.05(d) and Sections 15.05(a) and (b),
any dividend or distribution to which this Section 15.05(d) is applicable that
also includes shares of Common Stock, or rights or warrants to subscribe for or
purchase shares of Common Stock (or both), shall be deemed instead to be (1) a
dividend or distribution of the evidences of indebtedness, assets or shares of
capital stock other than such shares of Common Stock or rights or warrants (and
any Conversion Rate adjustment required by this Section 15.05(d) with respect to
such dividend or distribution shall then be made) immediately followed by (2) a
dividend or distribution of such shares of Common Stock or such rights or
warrants (and any further Conversion Rate adjustment required by Sections
15.05(a) and 15.05(b) with respect to such dividend or distribution shall then
be made), except (A) the Record Date of such dividend or distribution shall be
substituted as "the date fixed for the determination of stockholders entitled to
receive such dividend or other distribution", "the date fixed for the
determination of stockholders entitled to receive such rights or warrants" and
"the date fixed for such determination" within the meaning of Sections 15.05(a)
and 15.05(b) and (B) any shares of Common Stock included in such dividend or
distribution shall not be deemed "outstanding at the close of business on the
date fixed for such determination" within the meaning of Section 15.05(a).


                                       66
<PAGE>
                  (e)      In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock cash (excluding (x) any quarterly
cash dividend on the Common Stock to the extent the aggregate cash dividend per
share of Common Stock in any fiscal quarter does not exceed the greater of (A)
the amount per share of Common Stock of the next preceding quarterly cash
dividend on the Common Stock to the extent that such preceding quarterly
dividend did not require any adjustment of the Conversion Rate pursuant to this
Section 15.05(e) (as adjusted to reflect subdivisions, or combinations of the
Common Stock), and (B) 2.5% of the arithmetic average of the Closing Sale Price
during the ten Trading Days immediately prior to the date of declaration of such
dividend, and (y) any dividend or distribution in connection with the
liquidation, dissolution or winding up of the Company, whether voluntary or
involuntary), then, in such case, the Conversion Rate shall be increased so that
the same shall equal the rate determined by multiplying the Conversion Rate in
effect immediately prior to the close of business on such record date by a
fraction,

                  (i)      the numerator of which shall be the Current Market
         Price on such record date; and

                  (ii)     the denominator of which shall be the Current Market
         Price on such record date less the amount of cash so distributed (and
         not excluded as provided above) applicable to one share of Common
         Stock,

such adjustment to be effective immediately prior to the opening of business on
the day following the record date; provided that if the portion of the cash so
distributed applicable to one share of Common Stock is equal to or greater than
the Current Market Price on the record date, in lieu of the foregoing
adjustment, adequate provision shall be made so that each Noteholder shall have
the right to receive upon conversion the amount of cash such holder would have
received had such holder converted each Note on the record date. If such
dividend or distribution is not so paid or made, the Conversion Rate shall again
be adjusted to be the Conversion Rate that would then be in effect if such
dividend or distribution had not been declared. If any adjustment is required to
be made as set forth in this Section 15.05(e) as a result of a distribution that
is a quarterly dividend, such adjustment shall be based upon the amount by which
such distribution exceeds the amount of the quarterly cash dividend permitted to
be excluded pursuant hereto. If an adjustment is required to be made as set
forth in this Section 15.05(e) above as a result of a distribution that is not a
quarterly dividend, such adjustment shall be based upon the full amount of the
distribution.

                  (f)      In case a tender or exchange offer made by the
Company or any Subsidiary for all or any portion of the Common Stock shall
expire and such tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to stockholders of consideration per share of
Common Stock having a Fair Market Value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a resolution
of the Board of Directors) that as of the last time (the "EXPIRATION TIME")
tenders or exchanges may be made pursuant to such tender or exchange offer (as
it may be amended) exceeds the Closing Sale Price of a share of Common Stock on
the Trading Day next succeeding the Expiration Time, the Conversion Rate shall
be increased so that the same shall equal the rate determined by multiplying the
Conversion Rate in effect immediately prior to the Expiration Time by a
fraction,


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<PAGE>
                  (i)      the numerator of which shall be the sum of (x) the
         Fair Market Value (determined as aforesaid) of the aggregate
         consideration payable to stockholders based on the acceptance (up to
         any maximum specified in the terms of the tender or exchange offer) of
         all shares validly tendered or exchanged and not withdrawn as of the
         Expiration Time (the shares deemed so accepted up to any such maximum,
         being referred to as the "PURCHASED SHARES") and (y) the product of the
         number of shares of Common Stock outstanding (less any Purchased
         Shares) at the Expiration Time and the Closing Sale Price of a share of
         Common Stock on the Trading Day next succeeding the Expiration Time,
         and

                  (ii)     the denominator of which shall be the number of
         shares of Common Stock outstanding (including any tendered or exchanged
         shares) at the Expiration Time multiplied by the Closing Sale Price of
         a share of Common Stock on the Trading Day next succeeding the
         Expiration Time,

such adjustment to become effective immediately prior to the opening of business
on the day following the Expiration Time. If the Company is obligated to
purchase shares pursuant to any such tender or exchange offer, but the Company
is permanently prevented by applicable law from effecting any such purchases or
all such purchases are rescinded, the Conversion Rate shall again be adjusted to
be the Conversion Rate that would then be in effect if such tender or exchange
offer had not been made.

         (g)      In case of a tender or exchange offer made by a Person other
than the Company or any Subsidiary for an amount that increases the offeror's
ownership of Common Stock to more than twenty-five percent (25%) of the Common
Stock outstanding and shall involve the payment by such Person of consideration
per share of Common Stock having a Fair Market Value (as determined by the Board
of Directors, whose determination shall be conclusive, and described in a
resolution of the Board of Directors) that as of the last time (the "OFFER
EXPIRATION TIME") tenders or exchanges may be made pursuant to such tender or
exchange offer (as it shall have been amended) exceeds the Closing Price of a
share of Common Stock on the Trading Day next succeeding the Offer Expiration
Time, and in which, as of the Offer Expiration Time the Board of Directors is
not recommending rejection of the offer, the Conversion Rate shall be increased
so that the same shall equal the rate determined by multiplying the Conversion
Rate in effect immediately prior to the Offer Expiration Time by a fraction,

                  (i)      the numerator of which shall be the sum of (x) the
         Fair Market Value (determined as aforesaid) of the aggregate
         consideration payable to stockholders based on the acceptance (up to
         any maximum specified in the terms of the tender or exchange offer) of
         all shares validly tendered or exchanged and not withdrawn as of the
         Offer Expiration Time (the shares deemed so accepted, up to any such
         maximum, being referred to as the "ACCEPTED PURCHASED SHARES") and (y)
         the product of the number of shares of Common Stock outstanding (less
         any Accepted Purchased Shares) at the Offer Expiration Time and the
         Closing Sale Price of a share of Common Stock on the Trading Day next
         succeeding the Offer Expiration Time, and


                                       68
<PAGE>
                  (ii)     the denominator of which shall be the number of
         shares of Common Stock outstanding (including any tendered or exchanged
         shares) at the Offer Expiration Time multiplied by the Closing Sale
         Price of a share of Common Stock on the Trading Day next succeeding the
         Offer Expiration Time,

such adjustment to become effective immediately prior to the opening of business
on the day following the Offer Expiration Time. If such Person is obligated to
purchase shares pursuant to any such tender or exchange offer, but such Person
is permanently prevented by applicable law from effecting any such purchases or
all such purchases are rescinded, the Conversion Rate shall again be adjusted to
be the Conversion Rate that would then be in effect if such tender or exchange
offer had not been made. Notwithstanding the foregoing, the adjustment described
in this Section 15.05(g) shall not be made if, as of the Offer Expiration Time,
the offering documents with respect to such offer disclose a plan or intention
to cause the Company to engage in any transaction described in Article 12.

         (h)      For purposes of this Section 15.05, the following terms shall
have the meaning indicated:

                  (i)      "CURRENT MARKET PRICE" shall mean the average of the
         daily Closing Sale Prices per share of Common Stock for the ten
         consecutive Trading Days selected by the Company commencing no more
         than 30 Trading Days before and ending not later than the earlier of
         such date of determination and the day before the "EX" date with
         respect to the issuance, distribution, subdivision or combination
         requiring such computation immediately prior to the date in question.
         For purpose of this paragraph, the term "EX" date, (1) when used with
         respect to any issuance or distribution, means the first date on which
         the Common Stock trades, regular way, on the relevant exchange or in
         the relevant market from which the Closing Sale Price was obtained
         without the right to receive such issuance or distribution, and (2)
         when used with respect to any subdivision or combination of shares of
         Common Stock, means the first date on which the Common Stock trades,
         regular way, on such exchange or in such market after the time at which
         such subdivision or combination becomes effective.

                  If another issuance, distribution, subdivision or combination
         to which Section 15.05 applies occurs during the period applicable for
         calculating "CURRENT MARKET PRICE" pursuant to the definition in the
         preceding paragraph, "CURRENT MARKET PRICE" shall be calculated for
         such period in a manner determined by the Board of Directors to reflect
         the impact of such issuance, distribution, subdivision or combination
         on the Closing Sale Price of the Common Stock during such period.

                  (ii)     "FAIR MARKET VALUE" shall mean the amount which a
         willing buyer would pay a willing seller in an arm's-length
         transaction.

                  (iii)    "RECORD DATE" shall mean, with respect to any
         dividend, distribution or other transaction or event in which the
         holders of Common Stock have the right to receive any cash, securities
         or other property or in which the Common Stock (or other applicable
         security) is exchanged for or converted into any combination of cash,
         securities or other property, the date fixed for determination of
         stockholders entitled to


                                       69
<PAGE>
         receive such cash, securities or other property (whether such date is
         fixed by the Board of Directors or by statute, contract or otherwise).

                  (iv)     "TRADING DAY" shall mean (x) if the applicable
         security is quoted on the Nasdaq National Market, a day on which trades
         may be made thereon or (y) if the applicable security is listed or
         admitted for trading on the New York Stock Exchange or another national
         securities exchange, a day on which the New York Stock Exchange or
         another national securities exchange is open for business or (z) if the
         applicable security is not so listed, admitted for trading or quoted,
         any day other than a Saturday or Sunday or a day on which banking
         institutions in the State of New York are authorized or obligated by
         law or executive order to close.

                  (i)      The Company may make such increases in the Conversion
Rate, in addition to those required by Section 15.05(a), (b), (c), (d), (e), (f)
or (g) as the Board of Directors considers to be advisable to avoid or diminish
any income tax to holders of Common Stock or rights to purchase Common Stock
resulting from any dividend or distribution of stock (or rights to acquire
stock) or from any event treated as such for income tax purposes.

         To the extent permitted by applicable law, the Company from time to
time may increase the Conversion Rate by any amount for any period of time if
the period is at least twenty (20) days, the increase is irrevocable during the
period and the Board of Directors shall have made a determination that such
increase would be in the best interests of the Company, which determination
shall be conclusive. Whenever the Conversion Rate is increased pursuant to the
preceding sentence, the Company shall mail to holders of record of the Notes a
notice of the increase at least fifteen (15) days prior to the date the
increased Conversion Rate takes effect, and such notice shall state the
increased Conversion Rate and the period during which it will be in effect.

                  (j)      No adjustment in the Conversion Rate shall be
required unless such adjustment would require an increase or decrease of at
least one percent (1 %) in such rate; provided that any adjustments that by
reason of this Section 15.05(j) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Article 15 shall be made by the Company and shall be made to the
nearest cent or to the nearest one-ten thousandth (1/10,000) of a share, as the
case may be. No adjustment need be made for rights to purchase Common Stock
pursuant to a Company plan for reinvestment of dividends or interest or for any
issuance of Common Stock or convertible or exchangeable securities or rights to
purchase Common Stock or convertible or exchangeable securities. To the extent
the Notes become convertible into cash, assets, property or securities (other
than capital stock of the Company), no adjustment need be made thereafter as to
the cash, assets, property or such securities. Interest will not accrue on any
cash into which the Notes are convertible.

                  (k)      Whenever the Conversion Rate is adjusted as herein
provided, the Company shall promptly file with the Trustee and any conversion
agent other than the Trustee an Officers' Certificate setting forth the
Conversion Rate after such adjustment and setting forth a brief statement of the
facts requiring such adjustment. Unless and until a Responsible Officer of the
Trustee shall have received such Officers' Certificate, the Trustee shall not be
deemed to have knowledge of any adjustment of the Conversion Rate and may assume
that the last


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<PAGE>
Conversion Rate of which it has knowledge is still in effect. Promptly after
delivery of such certificate, the Company shall prepare a notice of such
adjustment of the Conversion Rate setting forth the adjusted Conversion Rate and
the date on which each adjustment becomes effective and shall mail such notice
of such adjustment of the Conversion Rate to the holder of each Note at his last
address appearing on the Note register provided for in Section 2.05 of this
Indenture, within twenty (20) days after execution thereof. Failure to deliver
such notice shall not affect the legality or validity of any such adjustment.

                  (l)      In any case in which this Section 15.05 provides that
an adjustment shall become effective immediately after (1) a record date or
Record Date for an event, (2) the date fixed for the determination of
stockholders entitled to receive a dividend or distribution pursuant to Section
15.05(a), (3) a date fixed for the determination of stockholders entitled to
receive rights or warrants pursuant to Section 15.05(b), (4) the Expiration Time
for any tender or exchange offer pursuant to Section 15.05(f), or (5) the Offer
Expiration Time for a tender or exchange offer pursuant to Section 15.05(g)(i)
(each a "DETERMINATION DATE"), the Company may elect to defer until the
occurrence of the applicable Adjustment Event (as hereinafter defined) (x)
issuing to the holder of any Note converted after such Determination Date and
before the occurrence of such Adjustment Event, the additional shares of Common
Stock or other securities issuable upon such conversion by reason of the
adjustment required by such Adjustment Event over and above the Common Stock
issuable upon such conversion before giving effect to such adjustment and (y)
paying to such holder any amount in cash in lieu of any fraction pursuant to
Section 15.03. For purposes of this Section 15.05(l), the term "ADJUSTMENT
EVENT" shall mean:

                  (i)      in any case referred to in clause (1) hereof, the
         occurrence of such event,

                  (ii)     in any case referred to in clause (2) hereof, the
         date any such dividend or distribution is paid or made,

                  (iii)    in any case referred to in clause (3) hereof, the
         date of expiration of such rights or warrants, and

                  (iv)     in any case referred to in clause (4) or clause (5)
         hereof, the date a sale or exchange of Common Stock pursuant to such
         tender or exchange offer is consummated and becomes irrevocable.

                  (m)      For purposes of this Section 15.05, the number of
shares of Common Stock at any time outstanding shall not include shares held in
the treasury of the Company but shall include shares issuable in respect of
scrip certificates issued in lieu of fractions of shares of Common Stock. The
Company will not pay any dividend or make any distribution on shares of Common
Stock held in the treasury of the Company.

         Section 15.06. Effect of Reclassification, Consolidation, Merger or
Sale. If any of the following events occur, namely (i) any reclassification or
change of the outstanding shares of Common Stock (other than a subdivision or
combination to which Section 15.05(c) applies), (ii) any consolidation, merger
or combination of the Company with another Person as a result of which holders
of Common Stock shall be entitled to receive stock, other securities or other


                                       71
<PAGE>
property or assets (including cash) with respect to or in exchange for such
Common Stock, or (iii) any sale or conveyance of all or substantially all of the
properties and assets of the Company to any other Person as a result of which
holders of Common Stock shall be entitled to receive stock, other securities or
other property or assets (including cash) with respect to or in exchange for
such Common Stock, then the Company or the successor or purchasing Person, as
the case may be, shall execute with the Trustee a supplemental indenture (which
shall comply with the Trust Indenture Act as in force at the date of execution
of such supplemental indenture) providing that each Note shall be convertible
into the kind and amount of shares of stock, other securities or other property
or assets (including cash) receivable upon such reclassification, change,
consolidation, merger, combination, sale or conveyance by a holder of a number
of shares of Common Stock issuable upon conversion of such Notes (assuming, for
such purposes, a sufficient number of authorized shares of Common Stock are
available to convert all such Notes) immediately prior to such reclassification,
change, consolidation, merger, combination, sale or conveyance assuming such
holder of Common Stock did not exercise his rights of election, if any, as to
the kind or amount of stock, other securities or other property or assets
(including cash) receivable upon such reclassification, change, consolidation,
merger, combination, sale or conveyance (provided that, if the kind or amount of
stock, other securities or other property or assets (including cash) receivable
upon such reclassification, change, consolidation, merger, combination, sale or
conveyance is not the same for each share of Common Stock in respect of which
such rights of election shall not have been exercised ("NON-ELECTING SHARE"),
then for the purposes of this Section 15.06 the kind and amount of stock, other
securities or other property or assets (including cash) receivable upon such
reclassification, change, consolidation, merger, combination, sale or conveyance
for each non-electing share shall be deemed to be the kind and amount so
receivable per share by a plurality of the non-electing shares). Such
supplemental indenture shall provide for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Article
15.

         The Company shall cause notice of the execution of such supplemental
indenture to be mailed to each holder of Notes, at its address appearing on the
Note register provided for in Section 2.05 of this Indenture, within twenty (20)
days after execution thereof. Failure to deliver such notice shall not affect
the legality or validity of such supplemental indenture.

         The above provisions of this Section shall similarly apply to
successive reclassifications, changes, consolidations, mergers, combinations,
sales and conveyances.

         If this Section 15.06 applies to any event or occurrence, Section 15.05
shall not apply.

         Section 15.07. Taxes on Shares Issued. The issue of stock certificates
on conversions of Notes shall be made without charge to the converting
Noteholder for any documentary, stamp or similar issue or transfer tax in
respect of the issue thereof. The Company shall not, however, be required to pay
any such tax which may be payable in respect of any transfer involved in the
issue and delivery of stock in any name other than that of the holder of any
Note converted, and the Company shall not be required to issue or deliver any
such stock certificate unless and until the Person or Persons requesting the
issue thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.


                                       72
<PAGE>
         Section 15.08. Reservation of Shares, Shares to Be Fully Paid;
Compliance with Governmental Requirements; Listing of Common Stock. The Company
shall provide, free from preemptive rights, out of its authorized but unissued
shares or shares held in treasury, sufficient shares of Common Stock to provide
for the conversion of the Notes from time to time as such Notes are presented
for conversion.

         Before taking any action which would cause an adjustment increasing the
Conversion Rate to an amount that would cause the Conversion Price to be reduced
below the then par value, if any, of the shares of Common Stock issuable upon
conversion of the Notes, the Company will take all corporate action which may,
in the opinion of its counsel, be necessary in order that the Company may
validly and legally issue shares of such Common Stock at such adjusted
Conversion Rate.

         The Company covenants that all shares of Common Stock which may be
issued upon conversion of Notes will upon issue be fully paid and non-assessable
by the Company and free from all taxes, liens and charges with respect to the
issue thereof.

         The Company covenants that, if any shares of Common Stock to be
provided for the purpose of conversion of Notes hereunder require registration
with or approval of any governmental authority under any federal or state law
before such shares may be validly issued upon conversion, the Company will in
good faith and as expeditiously as possible, to the extent then permitted by the
rules and interpretations of the Commission (or any successor thereto), endeavor
to secure such registration or approval, as the case may be.

         The Company further covenants that, if at any time the Common Stock
shall be listed on the Nasdaq National Market or any other national securities
exchange or automated quotation system, the Company will, if permitted by the
rules of such exchange or automated quotation system, list and keep listed, so
long as the Common Stock shall be so listed on such exchange or automated
quotation system, all Common Stock issuable upon conversion of the Notes;
provided that if the rules of such exchange or automated quotation system permit
the Company to defer the listing of such Common Stock until the first conversion
of the Notes into Common Stock in accordance with the provisions of this
Indenture, the Company covenants to list such Common Stock issuable upon
conversion of the Notes in accordance with the requirements of such exchange or
automated quotation system at such time.

         Section 15.09. Responsibility of Trustee. The Trustee and any other
conversion agent shall not at any time be under any duty or responsibility to
any holder of Notes to determine the Conversion Rate or whether any facts exist
which may require any adjustment of the Conversion Rate, or with respect to the
nature or extent or calculation of any such adjustment when made, or with
respect to the method employed, or herein or in any supplemental indenture
provided to be employed, in making the same. The Trustee and any other
conversion agent shall not be accountable with respect to the validity or value
(or the kind or amount) of any shares of Common Stock, or of any securities or
property, which may at any time be issued or delivered upon the conversion of
any Note; and the Trustee and any other conversion agent make no representations
with respect thereto. Neither the Trustee nor any conversion agent shall be
responsible for any failure of the Company to issue, transfer or deliver any
shares of Common Stock or stock certificates or other securities or property or
cash upon the surrender of any Note


                                       73
<PAGE>
for the purpose of conversion or to comply with any of the duties,
responsibilities or covenants of the Company contained in this Article 15.
Without limiting the generality of the foregoing, neither the Trustee nor any
conversion agent shall be under any responsibility to determine the correctness
of any provisions contained in any supplemental indenture entered into pursuant
to Section 15.06 relating either to the kind or amount of shares of stock or
securities or property (including cash) receivable by Noteholders upon the
conversion of their Notes after any event referred to in such Section 15.06 or
to any adjustment to be made with respect thereto, but, subject to the
provisions of Section 8.01, may accept as conclusive evidence of the correctness
of any such provisions, and shall be protected in relying upon, the Officers'
Certificate (which the Company shall be obligated to file with the Trustee prior
to the execution of any such supplemental indenture) with respect thereto.

         Section 15.10. Notice to Holders Prior to Certain Actions. In case:

                  (a)      the Company shall declare a dividend (or any other
         distribution) on its Common Stock that would require an adjustment in
         the Conversion Rate pursuant to Section 15.05; or

                  (b)      the Company shall authorize the granting to the
         holders of all or substantially all of its Common Stock of rights or
         warrants to subscribe for or purchase any share of any class or any
         other rights or warrants; or

                  (c)      of any reclassification or reorganization of the
         Common Stock of the Company (other than a subdivision or combination of
         its outstanding Common Stock, or a change in par value, or from par
         value to no par value, or from no par value to par value), or of any
         consolidation or merger to which the Company is a party and for which
         approval of any stockholders of the Company is required, or of the sale
         or transfer of all or substantially all of the assets of the Company;
         or

                  (d)      of the voluntary or involuntary dissolution,
         liquidation or winding up of the Company;

the Company shall cause to be filed with the Trustee and to be mailed to each
holder of Notes at his address appearing on the Note register provided for in
Section 2.05 of this Indenture, as promptly as possible but in any event at
least ten (10) days prior to the applicable date hereinafter specified, a notice
stating (x) the date on which a record is to be taken for the purpose of such
dividend, distribution or rights or warrants, or, if a record is not to be
taken, the date as of which the holders of Common Stock of record to be entitled
to such dividend, distribution or rights are to be determined, or (y) the date
on which such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up is expected to become effective or occur,
and the date as of which it is expected that holders of Common Stock of record
shall be entitled to exchange their Common Stock for securities or other
property deliverable upon such reclassification, consolidation, merger, sale,
transfer, dissolution, liquidation or winding up. Failure to give such notice,
or any defect therein, shall not affect the legality or validity of such
dividend, distribution, reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up.


                                       74
<PAGE>
         Section 15.11. Future Stockholder Rights Plans. If the Company
hereafter adopts any stockholder rights plan, a Noteholder shall be entitled to
receive upon conversion of their Notes in addition to the shares of Common Stock
issuable upon conversion the related rights for the Common Stock whether or not
the rights under the future stockholder rights plan have separated from the
Common Stock at the time of conversion but otherwise subject to the generally
applicable terms of such plan and no additional adjustment to the Conversion
Rate shall be made.

                                   ARTICLE 16

                                  SUBORDINATION

         Section 16.01. Securities Subordinate to Senior Debt. The Company
covenants and agrees, and each holder of a Note by his acceptance thereof
likewise covenants and agrees, that to the extent and in the manner hereinafter
set forth in this Article (subject to the provisions of Article 13) the
indebtedness represented by the Notes and the payment of the principal amount,
premium, if any, plus accrued and unpaid interest on (including, without
limitation, interest, as provided in the Notes, accruing after the filing of a
petition initiating any proceeding referred to in Section 7.01(e) or 7.01(f),
whether or not such interest accrues after the filing of such petition for
purposes for purposes of Title 11 of the United States Code or is an allowed
claim in such proceeding), any payment of the redemption or repurchase price
with respect to, and all fees, expenses or other amounts payable under or in
respect of, each and all of the Notes (the "SUBORDINATED DEBT") are hereby
expressly made subordinate and subject in right of payment to the prior payment
in full of all Senior Debt in cash or other payment satisfactory to holders of
Senior Debt, in their sole discretion, whether outstanding at the date of this
Indenture or thereafter incurred.

         Section 16.02. No Payments in Certain Circumstances; Payment Over of
Proceeds upon Dissolution, Etc. No payment shall be made by or on behalf of the
Company for or on account of any Subordinated Debt, and neither the Trustee nor
any holder of any Note shall take or receive from the Company, directly or
indirectly, in cash or other property or by setoff or in any other manner,
including, without limitation, from or by way of collateral (other than payments
made from any trust created pursuant to Section 13.01 hereof) if, at the time of
such payment: (a) a default in the payment of principal, premium, if any, or
interest or other amounts due on or in connection with any Designated Senior
Debt, including any default under any redemption or repurchase obligation,
occurs and is continuing (or, in the case of Designated Senior Debt for which
there is a period of grace, in the event of such a default that continues beyond
the period of grace, if any, specified in the instrument or lease evidencing
such Designated Senior Debt), unless and until such default shall have been
cured or waived or shall have ceased to exist (a "PAYMENT DEFAULT"); or (b) a
default, other than a payment default, on Designated Senior Debt occurs and is
continuing that then permits holders of such Designated Senior Debt to
accelerate its maturity, or in the case of a lease, a default occurs and is
continuing that permits the lessor to either terminate the lease or require the
Company to make an irrevocable offer to terminate the lease following an event
of default under the lease, and the Trustee receives a notice of such default (a
"PAYMENT BLOCKAGE NOTICE") from the Company, the Administrative Agent under the
Senior Credit Facility or any other person permitted to give such notice
hereunder. So long as any Senior Debt remains outstanding under the Senior
Credit Facility, the only Person that shall


                                       75
<PAGE>
be permitted to deliver a Payment Blockage Notice on behalf of any holder of
Designated Senior Debt shall be the Administrative Agent and thereafter, may be
any other holder of Designated Senior Debt. Notwithstanding the foregoing, the
Company may make, and the Trustee may receive and shall apply, any payment in
respect of the Notes (for principal amount, premium, if any, or accrued and
unpaid interest) if such payment was made prior to the occurrence of any of the
contingencies specified in clauses (a) and (b) above.

         If the Trustee receives any Payment Blockage Notice pursuant to clause
(b) above, no subsequent Payment Blockage Notice shall be effective for purposes
of this Section 16.02 unless and until at least 365 days shall have elapsed
since the initial effectiveness of the immediately prior Payment Blockage
Notice. No nonpayment default that existed or was continuing on the date of
delivery of any Payment Blockage Notice to the Trustee (unless such default was
waived, cured or otherwise ceased to exist and thereafter subsequently
reoccurred) shall be, or be made, the basis for a subsequent Payment Blockage
Notice.

         The Company may and shall resume payments on and distributions in
respect of the Notes (including missed payments, if any) upon the earlier of:
(A) the date upon which the default is cured or waived or ceases to exist, or
(B) in the case of a default referred to in clause (b) of the second preceding
paragraph, the earlier of the date on which such nonpayment default is cured or
waived or ceases to exist or 179 days after such Payment Blockage Notice is
received, if the maturity of such Designated Senior Debt has not been
accelerated, or in the case of any lease, 179 days after notice is received if
the Company has not received notice that the lessor under such lease has
exercised its rights to terminate the lease or require the Company to make an
irrevocable offer to terminate the lease following an event of default under
such lease.

         Upon (i) any acceleration of the principal amount due on the Notes or
(ii) any payment or distribution of assets of the Company of any kind or
character, whether in cash, property or securities, to creditors upon any
dissolution, winding up or total or partial liquidation or reorganization of the
Company, whether voluntary or involuntary, or in bankruptcy, insolvency,
receivership or other proceedings, all principal amount, premium, if any,
sinking fund and interest or other amounts due, or to become due, upon or in
connection with all Senior Debt shall first be paid in full in cash or other
payment satisfactory to the holders of such Senior Debt, in their sole
discretion, before any payment is made on account of the Subordinated Debt, and
upon any such dissolution or winding up or liquidation or reorganization any
payment or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, to which the holders of the Notes or
the Trustee under this Indenture would be entitled, except for the provisions
hereof, shall be paid by the Company or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other person making such payment or distribution,
or by the holders of the Notes or by the Trustee under this Indenture if
received by them or it, as the case may be, directly to the holders of Senior
Debt (pro rata to each such holder on the basis of the respective amounts of
Senior Debt held by such holder) or their representatives, to the extent
necessary to pay all Senior Debt in full, in cash, or other payment satisfactory
to the holders of such Senior Debt, in their sole discretion, after giving
effect to any concurrent payment or distribution to or for the holders of Senior
Debt, before any payment or distribution is made to the holders of the Notes or
to the Trustee under the Subordinated Debt.


                                       76
<PAGE>
         In the event that, contrary to the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities (other than junior securities, as defined in Section
16.11), shall be received by the Trustee or the holders of the Notes before all
Senior Debt is paid in full in cash or other payment satisfactory to the holders
of Senior Debt, in their sole discretion, such payment or distribution shall be
paid over or delivered to the holders of such Senior Debt or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any of such Senior Debt
have been issued, as their respective interests may appear, for application to
the payment of all Senior Debt remaining unpaid to the extent necessary to pay
all such Senior Debt in full in cash or other payment satisfactory to the
holders of such Senior Debt, in their sole discretion, in accordance with its
terms, after giving effect to any concurrent payment or distribution to or for
the holders of such Senior Debt.

         Subject to the payment in full in cash of all Senior Debt or other
payment satisfactory to holders of such Senior Debt, in their sole discretion,
the holders of the Notes (together with the holders of any other indebtedness of
the Company that is subordinated in right of payment to the payment in full in
cash of all Senior Debt that is not subordinated in right of payment to the
Notes and that by its terms grants such right of subrogation to the holders
thereof) shall be subrogated to the rights of the holders of Senior Debt to
receive payments or distribution of assets of the Company made on the Senior
Debt until the principal of, premium, if any, and interest on, or amounts
payable upon redemption or repurchase of, the Notes shall be paid in full; and,
for the purposes of such subrogation, no payments or distributions to the
holders of Senior Debt of any cash, property or securities to which the holders
of the Notes or the Trustee would be entitled except for the provisions of this
Article, and no payment over pursuant to the provisions of this Article to the
holders of Senior Debt by the holders of the Notes or the Trustee, shall, as
between the Company, its creditors other than the holders of Senior Debt, and
the holders of Notes, be deemed to be a payment by the Company to the holders of
or on account of Senior Debt, it being understood that the provisions of this
Article are and are intended solely for the purpose of defining the relative
rights of the holders of the Notes, on the one hand, and the holders of Senior
Debt, on the other hand.

         While any amount of Senior Debt under the Senior Credit Facility
remains outstanding, if any proceeding referred to in this Section 16.02 is
commenced by or against the Company,

                  (i)      the Administrative Agent is hereby irrevocably
         authorized and empowered (in its own name or in the name of the holders
         of the Subordinated Debt or otherwise), but shall have no obligation,
         to demand, sue for, collect and receive every payment or distribution
         referred to in this Section 16.02 and give acquittance therefor and to
         file claims and proofs of claim and take such other action (including,
         without limitation, voting the Subordinated Debt or enforcing any
         security interest or other lien securing payment of the Subordinated
         Debt) as it may deem necessary or advisable for the exercise or
         enforcement of any of the rights or interests of the holders of Senior
         Debt hereunder; and

                  (ii)     the holders of the Subordinated Debt and the Trustee
         shall duly and promptly take such action as the Administrative Agent
         may request (A) to collect the Subordinated Debt for the account of the
         holders of Senior Debt and to file appropriate


                                       77
<PAGE>
         claims or proofs or claim in respect of the Subordinated Debt, (B) to
         execute and deliver to the Administrative Agent such powers of
         attorney, assignments, or other instruments as the Administrative Agent
         may request in order to enable the Administrative Agent to enforce any
         and all claims with respect to, and any security interests and other
         liens securing payment of, the Subordinated Debt, and (C) to collect
         and receive any and all payments or distributions which may be payable
         or deliverable upon or with respect to the Subordinated Debt.

         The Administrative Agent is hereby authorized to demand specific
performance of the provisions of this Article 16, whether or not the Company
shall have complied with any of the provisions hereof applicable to it, at any
time when any holder of Subordinated Debt or the Trustee shall have failed to
comply with any of the provisions of this Article 16 applicable to it. The
holders of the Subordinated Debt and the Trustee hereby irrevocably waive any
defense based on the adequacy of a remedy at law, which might be asserted as a
bar to such remedy of specific performance.

         The holders of the Subordinated Debt, the Trustee and the Company each
will, at the Company's expense and at any time and from time to time, promptly
execute and deliver all further instruments and documents, and take all further
action, that may be necessary or desirable, or that the Administrative Agent may
request, in order to protect any right or interest granted or purported to be
granted hereby or to enable any holder of Senior Debt to exercise and enforce
its rights and remedies hereunder.

         No amendment, waiver or other modification of this Indenture, and no
indenture supplemental to this Indenture, may adversely affect the rights or
interests of any holder of Senior Debt hereunder. The Trustee shall promptly
notify the Administrative Agent of the occurrence of any default under the
Subordinated Debt.

         Section 16.03. Trustee to Effectuate Subordination. Each holder of a
Note by his acceptance thereof authorizes and directs the Trustee on his behalf
to take such action as may be necessary or appropriate to effectuate the
subordination provided in this Article and appoints the Trustee his
attorney-in-fact for any and all such purposes.

         Section 16.04. No Waiver of Subordination Provisions. No right of any
present or future holder of any Senior Debt to enforce subordination as herein
provided shall at any time in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or by any act or failure to act, in
good faith, by any such holder of any Senior Debt or by any non-compliance by
the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof any such holder may have or be otherwise
charged with.

         Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Debt may, at any time and from time to time, without the
consent of or notice to the Trustee or the holders of the Notes, without
incurring responsibility to the holders of the Notes and without impairing or
releasing the subordination provided in this Article or the obligations
hereunder of the holders of the Notes to the holders of Senior Debt, do any one
or more of the following: (a) change the manner, place or terms of payment or
extend the time of payment of, or renew or alter, Senior Debt or otherwise amend
or supplement in any manner Senior Debt or


                                       78
<PAGE>
any instrument evidencing the same or any agreement under which Senior Debt is
outstanding; (b) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Debt; (c) release any person
liable in any manner for the collection of Senior Debt; and (d) exercise or
refrain from exercising any rights against the Company and any other person. All
rights and interests of the holders of Senior Debt hereunder, and all agreements
and obligations of the holders of the Subordinated Debt, the Trustee and the
Company under this Article 16, shall remain in full force and effect
irrespective of any lack of validity or enforceability of the Senior Credit
Facility. The provisions of this Article 16 shall continue to be effective or be
reinstated, as the case may be, if at any time any payment of any of the Senior
Debt is rescinded or must otherwise be returned by any holder of Senior Debt
upon the insolvency, bankruptcy or reorganization of the Company or otherwise,
all as though such payment had not been made.

         Section 16.05. Notice to Trustee. The Company shall give prompt written
notice to the Trustee of any fact known to the Company that would prohibit the
making of any payment to or by the Trustee in respect of the Notes.
Notwithstanding the provisions of this Article or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment to or by the Trustee in
respect of the Notes, unless and until a Responsible Officer of the Trustee
shall have received written notice thereof from the Company or a holder of
Senior Debt or from any trustee, agent or representative therefor; and, prior to
the receipt of any such written notice, the Trustee shall be entitled in all
respects to assume that no such facts exist; provided, however, that if the
Trustee shall not have received the notice provided for in this Section 16.05
prior to the date upon which by the terms hereof any money may become payable
for any purpose (including without limitation the payment of the principal of
(and premium, if any) or interest on any Note), then, anything herein contained
to the contrary notwithstanding, the Trustee shall have full power and authority
to receive such money and to apply the same to the purpose for which such money
was received and shall not be affected by any notice to the contrary that may be
received by it within two Business Days prior to such date.

         Subject to the provisions of Section 8.01, the Trustee shall be
entitled to rely on the delivery to it of a written notice by a person
representing himself to be a holder of Senior Debt (or a trustee, agent or
representative therefor) to establish that such notice has been given by a
holder of Senior Debt (or a trustee, agent or representative therefor). In the
event that the Trustee determines in good faith that further evidence is
required with respect to the right of any person as a holder of Senior Debt to
participate in any payment or distribution pursuant to this Article 16, the
Trustee may request such person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Debt held by such person,
the extent to which such person is entitled to participate in such payment or
distribution and any other facts pertinent to the rights of such person under
this Article 16, and if such evidence is not furnished, the Trustee may defer
any payment to such person pending judicial determination as to the right of
such person to receive such payment.

         Section 16.06. Reliance on Judicial Order of Certificate of Liquidating
Agent. Upon any payment or distribution of assets of the Company referred to in
this Article, the Trustee, subject to the provisions of Section 8.01, and the
holders of the Notes shall be entitled to rely upon any


                                       79
<PAGE>
order or decree entered by any court of competent jurisdiction in which such
insolvency, bankruptcy, receivership, liquidation, reorganization, dissolution,
winding up or similar case or proceeding is pending, or a certificate of the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee for
the benefit of creditors, agent or other person making such payment or
distribution, delivered to the Trustee or to the holders of Notes, for the
purpose of ascertaining the persons entitled to participate in such payment or
distribution, the holders of the Senior Debt and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article.

         Section 16.07. Trustee Not Fiduciary for Holders of Senior Debt. The
Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior
Debt and shall not be liable to any such holders if it shall in good faith
mistakenly pay over or distribute to holders of Notes or to the Company or to
any other person cash, property or securities to which any holders of Senior
Debt shall be entitled by virtue of this Article or otherwise. With respect to
the holders of Senior Debt, the Trustee undertakes to perform or to observe only
such of its covenants or obligations as are specifically set forth in this
Article 16, and no implied covenants or obligations with respect to holders of
Senior Debt shall be read into this Indenture against the Trustee.

         Section 16.08. Reliance by Holders of Senior Debt on Subordination
Provisions. Each holder by accepting a Note acknowledges and agrees that the
foregoing subordination provisions are, and are intended to be, an inducement
and a consideration to each holder of any Senior Debt, whether such Senior Debt
was created or acquired before or after the issuance of the Notes, to acquire
and continue to hold, or to continue to hold, such Senior Debt, and such holder
of Senior Debt shall be deemed conclusively to have relied on such subordination
provisions in acquiring and continuing to hold, or in continuing to hold, such
Senior Debt. Such holders of the Company's Senior Debt are intended by the
parties to the Indenture to be third party creditor beneficiaries under this
Indenture for the purposes of enforcing the provisions of this Article 16.

         Section 16.09. Rights of Trustee as Holder of Senior Debt; Preservation
of Trustee's Rights. The Trustee in its individual capacity shall be entitled to
all the rights set forth in this Article 16 with respect to any Senior Debt that
may at any time be held by it, to the same extent as any other holder of Senior
Debt, and nothing in this Indenture shall deprive the Trustee of any of its
rights as such holder.

         Nothing in this Article 16 shall apply to claims of, or payments to,
the Trustee under or pursuant to Section 8.06.

         Section 16.10. Article Applicable to Paying Agents. In case at any time
any paying agent other than the Trustee shall have been appointed by the Company
and be then acting hereunder, the term "Trustee" as used in this Article shall
in such case (unless the context otherwise requires) be construed as extending
to and including such paying agent within its meaning as fully for all intents
and purposes as if such paying agent were named in this Article 16 in addition
to or in place of the Trustee; provided, however, that Section 16.09 shall not
apply to the Company or any Affiliate of the Company if it or such Affiliate
acts as paying agent.

         Section 16.11. Certain Conversions and Repurchases Deemed Payment. For
the purposes of this Article 16 only, (a) the issuance and delivery of junior
securities upon


                                       80
<PAGE>
conversion of Notes in accordance with Article 15 shall not be deemed to
constitute a payment or distribution on account of the principal amount, or
premium or interest on the Notes or on account of the purchase or other
acquisition of Notes, and (b) the payment, issuance or delivery of cash,
property or securities (other than junior securities) upon conversion of a Note
in accordance with Article 15 or upon redemption or repurchase of a Note in
accordance with Article 3 shall be deemed to constitute payment on account of
the principal of such Note: For the purposes of this Section 16.11, the term
"JUNIOR SECURITIES" means debt securities of the Company that are subordinated
in right of payment to all Senior Debt that may be outstanding at the time of
issuance or delivery of such securities to substantially the same extent as, or
to a greater extent than, the Notes are so subordinated as provided in this
Article 16. Nothing contained in this Article 16 or elsewhere in this Indenture
or in the Notes is intended to or shall impair, as among the Company, its
creditors other than holders of Senior Debt and the holders of the Notes, the
right, which is absolute and unconditional, of the holder of any Note to convert
such Note in accordance with Article 15 or to exchange such Note for Common
Stock in accordance with Article 15.

                                   ARTICLE 17

                            MISCELLANEOUS PROVISIONS

         SECTION 17.01. Provisions Binding on Company's Successors. All the
covenants, stipulations, promises and agreements by the Company contained in
this Indenture shall bind its successors and assigns whether so expressed or
not.

         Section 17.02. Official Acts by Successor Corporation. Any act or
proceeding by any provision of this Indenture authorized or required to be done
or performed by any board, committee or officer of the Company shall and may be
done and performed with like force and effect by the like board, committee or
officer of any Person that shall at the time be the lawful sole successor of the
Company.

         Section 17.03. Addresses for Notices, Etc. Any notice or demand which
by any provision of this Indenture is required or permitted to be given or
served by the Trustee or by the holders of Notes on the Company shall be deemed
to have been sufficiently given or made, for all purposes, if given or served by
being deposited postage prepaid by registered or certified mail in a post office
letter box or sent by telecopier transmission addressed as follows: to Steel
Dynamics, Inc., Chief Financial Officer, 6714 Pointe Inverness Way, Suite 200,
Fort Wayne, Indiana 46804, Telecopier No.: (260) 969-3592, Attention: Treasurer.
Any notice, direction, request or demand hereunder to or upon the Trustee shall
be deemed to have been sufficiently given or made, for all purposes, if given or
served by being deposited, postage prepaid, by registered or certified mail in a
post office letter box or sent by telecopier transmission addressed as follows:
Fifth Third Bank, Indiana, 251 N. Illinois Street, Suite 310, Indianapolis, IN
46204, Attention: Corporate Trust Department (Telecopier No.: 317-383-2992).

         The Trustee, by notice to the Company, may designate additional or
different addresses for subsequent notices or communications.


                                       81
<PAGE>
         Any notice or communication mailed to a Noteholder shall be mailed to
him by first class mail, postage prepaid, at his address as it appears on the
Note register and shall be sufficiently given to him if so mailed within the
time prescribed.

         Failure to mail a notice or communication to a Noteholder or any defect
in it shall not affect its sufficiency with respect to other Noteholders. If a
notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.

         Section 17.04. Governing Law. This Indenture and each Note shall be
deemed to be a contract made under the laws of the State of New York, and for
all purposes shall be construed in accordance with the laws of the State of New
York, without regard to conflicts of laws principles thereof.

         Section 17.05. Evidence of Compliance with Conditions Precedent,
Certificates to Trustee. Upon any application or demand by the Company to the
Trustee to take any action under any of the provisions of this Indenture, the
Company shall furnish to the Trustee an Officers' Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with, and an Opinion of Counsel stating that,
in the opinion of such counsel, all such conditions precedent have been complied
with.

         Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
provided for in this Indenture shall include: (1) a statement that the person
making such certificate or opinion has read such covenant or condition; (2) a
brief statement as to the nature and scope of the examination or investigation
upon which the statement or opinion contained in such certificate or opinion is
based; (3) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and (4) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.

         Section 17.06. Legal Holidays. In any case in which the date of
maturity of interest on or principal of the Notes or the redemption date of any
Note will not be a Business Day, then payment of such interest on or principal
of the Notes need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on the date of
maturity or the redemption date, and no interest shall accrue for the period
from and after such date.

         Section 17.07. Trust Indenture Act. This Indenture is hereby made
subject to, and shall be governed by, the provisions of the Trust Indenture Act
required to be part of and to govern indentures qualified under the Trust
Indenture Act; provided that unless otherwise required by law, notwithstanding
the foregoing, this Indenture and the Notes issued hereunder shall not be
subject to the provisions of subsections (a)(1), (a)(2), and (a)(3) of Section
314 of the Trust Indenture Act as now in effect or as hereafter amended or
modified; provided further that this Section 17.07 shall not require this
Indenture or the Trustee to be qualified under the Trust Indenture Act prior to
the time such qualification is in fact required under the terms of the Trust
Indenture Act, nor shall it constitute any admission or acknowledgment by any
party to the Indenture that any such qualification is required prior to the time
such qualification is in fact


                                       82
<PAGE>
required under the terms of the Trust Indenture Act. If any provision hereof
limits, qualifies or conflicts with another provision hereof which is required
to be included in an indenture qualified under the Trust Indenture Act, such
required provision shall control.

         Section 17.08. No Security Interest Created. Nothing in this Indenture
or in the Notes, expressed or implied, shall be construed to constitute a
security interest under the Uniform Commercial Code or similar legislation, as
now or hereafter enacted and in effect, in any jurisdiction in which property of
the Company or its subsidiaries is located.

         Section 17.09. Benefits of Indenture. Nothing in this Indenture or in
the Notes, express or implied, shall give to any Person, other than the parties
hereto, any paying agent, any authenticating agent, any Note registrar and their
successors hereunder and the holders of Notes any benefit or any legal or
equitable right, remedy or claim under this Indenture.

         Section 17.10. Table of Contents, Headings, Etc. The table of contents
and the titles and headings of the Articles and Sections of this Indenture have
been inserted for convenience of reference only, are not to be considered a part
hereof, and shall in no way modify or restrict any of the terms or provisions
hereof.

         Section 17.11. Authenticating Agent. The Trustee may appoint an
authenticating agent that shall be authorized to act on its behalf, and subject
to its direction, in the- authentication and delivery of Notes in connection
with the original issuance thereof and transfers and exchanges of Notes
hereunder, including under Sections 2.04, 2.05, 2.06, 2.07, 3.03 and 3.05, as
fully to all intents and purposes as though the authenticating agent had been
expressly authorized by this Indenture and those Sections to authenticate and
deliver Notes. For all purposes of this Indenture, the authentication and
delivery of Notes by the authenticating agent shall be deemed to be
authentication and delivery of such Notes "by the Trustee" and a certificate of
authentication executed on behalf of the Trustee by an authenticating agent
shall be deemed to satisfy any requirement hereunder or in the Notes for the
Trustee's certificate of authentication. Such authenticating agent shall at all
times be a Person eligible to serve as trustee hereunder pursuant to Section
8.09.

         Any corporation into which any authenticating agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any authenticating agent
shall be a party, or any corporation succeeding to the corporate trust business
of any authenticating agent, shall be the successor of the authenticating agent
hereunder, if such successor corporation is otherwise eligible under this
Section 17.11, without the execution or filing of any paper or any further act
on the part of the parties hereto or the authenticating agent or such successor
corporation.

         Any authenticating agent may at any time resign by giving written
notice of resignation to the Trustee and to the Company. The Trustee may at any
time terminate the agency of any authenticating agent by giving written notice
of termination to such authenticating agent and to the Company. Upon receiving
such a notice of resignation or upon such a termination, or in case at any time
any authenticating agent shall cease to be eligible under this Section, the
Trustee shall either promptly appoint a successor authenticating agent or itself
assume the duties and obligations of the former authenticating agent under this
Indenture and, upon such appointment


                                       83
<PAGE>
of a successor authenticating agent, if made, shall give written notice of such
appointment of a successor authenticating agent to the Company and shall mail
notice of such appointment of a successor authenticating agent to all holders of
Notes as the names and addresses of such holders appear on the Note register.

         The Company agrees to pay to the authenticating agent from time to time
such reasonable compensation for its services as shall be agreed upon in writing
between the Company and the authenticating agent.

         The provisions of Sections 8.02, 8.03, 8.04 and 9.03 and this Section
17.11 shall be applicable to any authenticating agent.

         Section 17.12. Execution in Counterparts. This Indenture may be
executed in any number of counterparts, each of which shall be an original, but
such counterparts shall together constitute but one and the same instrument.

         Section 17.13. Severability. In case any provision in this Indenture or
in the Notes shall be invalid, illegal or unenforceable, then (to the extent
permitted by law) the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.

         Fifth Third Bank, Indiana hereby accepts the trusts in this Indenture
declared and provided, upon the terms and conditions herein above set forth.


                                       84
<PAGE>
         IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed.

                                     STEEL DYNAMICS, INC.

                                     By: /s/ Tracy L. Shellabarger
                                         ---------------------------------------
                                         Name:   Tracy L. Shellabarger

                                         Title:  Vice President, Chief Financial
                                                 Officer and Secretary


                                     FIFTH THIRD BANK, INDIANA, as
                                        Trustee

                                     By: /s/ George L. Bawcum
                                         ---------------------------------------
                                         Name:  George L. Bawcum

                                         Title: Trust Officer
<PAGE>
                                     ANNEX 1

                           PROJECTED PAYMENT SCHEDULE(1)

<TABLE>
<CAPTION>
     SEMIANNUAL PERIOD          NONCONTINGENT     CONTINGENT          TOTAL
          ENDING                  PAYMENTS         PAYMENTS         PAYMENTS
   ---------------------       ---------------   ------------      -----------
<S>                            <C>               <C>               <C>
   June 15, 2003                  $   19.11               --        $   19.11
   December 15, 2003              $   20.00               --        $   20.00
   June 15, 2004                  $   20.00               --        $   20.00
   December 15, 2004              $   20.00               --        $   20.00
   June 15, 2005                  $   20.00               --        $   20.00
   December 15, 2005              $   20.00               --        $   20.00
   June 15, 2006                  $   20.00               --        $   20.00
   December 15, 2006              $   20.00               --        $   20.00
   June 15, 2007                  $   20.00               --        $   20.00
   December 15, 2007              $   20.00               --        $   20.00
   June 15, 2008                  $   20.00               --        $   20.00
   December 15, 2008              $   20.00               --        $   20.00
   June 15, 2009                  $   20.00        $    3.10        $   23.10
   December 15, 2009              $   20.00        $    3.24        $   23.24
   June 15, 2010                  $   20.00        $    3.40        $   23.40
   December 15, 2010              $   20.00        $    3.56        $   23.56
   June 15, 2011                  $   20.00        $    3.73        $   23.73
   December 15, 2011              $   20.00        $    3.91        $   23.91
   June 15, 2012                  $   20.00        $    4.09        $   24.09
   December 15, 2012              $   20.00        $1,801.65        $1,821.65
</TABLE>

Comparable yield: 9.25% compounded semiannually

----------

      (1) The schedule of projected payments is determined on the basis of an
assumption of linear growth of the stock price and is not determined for any
purpose other than for the determination of interest accruals and adjustments
thereof in respect of the Notes for United States federal income tax purposes.
The schedule of projected payments does not constitute a projection or
representation regarding the amounts payable on the Notes.
<PAGE>
                                                                       EXHIBIT A

                              STEEL DYNAMICS, INC.

                   4% CONVERTIBLE SUBORDINATED NOTE DUE 2012

[Include only for Global Notes:]

[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (THE
"DEPOSITARY", WHICH TERM INCLUDES ANY SUCCESSOR DEPOSITARY FOR THE CERTIFICATES)
TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND
ANY PAYMENT HEREIN IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE, OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH
AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

[Include only for Notes that are Restricted Securities:]

[THE NOTE EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT AS SET FORTH
IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS
THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT); (2) AGREES THAT IT WILL NOT, PRIOR TO EXPIRATION OF THE HOLDING
PERIOD APPLICABLE TO SALES OF THE NOTE EVIDENCED HEREBY UNDER RULE 144(K) UNDER
THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION), RESELL OR OTHERWISE TRANSFER
THIS NOTE OR THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE EXCEPT (A)
TO STEEL DYNAMICS, INC. OR ANY SUBSIDIARY THEREOF, (B) TO A QUALIFIED
INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C)
PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE) OR (D) PURSUANT TO A REGISTRATION STATEMENT WHICH
HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT (AND WHICH CONTINUES TO BE
EFFECTIVE AT THE TIME OF SUCH TRANSFER); (3) PRIOR TO SUCH TRANSFER (OTHER THAN
A TRANSFER PURSUANT TO CLAUSE (2)(D) ABOVE), IT WILL FURNISH TO THE FIFTH THIRD
BANK, INDIANA, AS TRUSTEE (OR A SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS THE TRUSTEE MAY
REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS
<PAGE>
BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT; AND (4) AGREES THAT IT WILL
DELIVER TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY
TO THE EFFECT OF THIS LEGEND. THIS LEGEND WILL BE REMOVED UPON THE EARLIER OF
THE TRANSFER OF THIS NOTE PURSUANT TO CLAUSE (2)(D) ABOVE OR UPON ANY TRANSFER
OF THIS NOTE UNDER RULE 144(K) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR
PROVISION). THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE
TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING
RESTRICTION.]

THIS NOTE WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR U.S. FEDERAL INCOME TAX
PURPOSES. FOR PURPOSES OF SECTIONS 1273 AND 1275 OF THE INTERNAL REVENUE CODE,
THE ISSUE PRICE OF EACH NOTE IS $1,000 PER $1,000 OF PRINCIPAL AMOUNT, THE ISSUE
DATE IS DECEMBER 23, 2002 AND THE COMPARABLE YIELD IS 9.25%, COMPOUNDED
SEMI-ANNUALLY. HOLDERS OF THIS NOTE MAY OBTAIN INFORMATION REGARDING THE AMOUNT
OF ORIGINAL ISSUE DISCOUNT, YIELD TO MATURITY AND THE PROJECTED PAYMENT SCHEDULE
FOR THIS NOTE BY SUBMITTING A WRITTEN REQUEST FOR SUCH INFORMATION TO: STEEL
DYNAMICS, INC., CHIEF FINANCIAL OFFICER, 6714 POINTE INVERNESS WAY, SUITE 200,
FORT WAYNE, INDIANA 46804.


                                       A-2
<PAGE>
                              STEEL DYNAMICS, INC.

                   4% CONVERTIBLE SUBORDINATED NOTE DUE 2012

                                                  CUSIP: 858 119 AC4 [144A ONLY]

No. 1                                                        $__________

      Steel Dynamics, Inc., a corporation duly organized and validly existing
under the laws of the State of Indiana (herein called the "COMPANY", which term
includes any successor corporation under the Indenture referred to on the
reverse hereof), for value received hereby promises to pay to CEDE & CO. or its
registered assigns, the principal sum of     DOLLARS] [the principal sum set
forth on Schedule I hereto](2) on December 15, 2012 at the office or agency of
the Company maintained for that purpose in accordance with the terms of the
Indenture, in such coin or currency of the United States of America as at the
time of payment shall be legal tender for the payment of public and private
debts, and to pay interest, semiannually on June 15 and December 15 of each
year, commencing June 15, 2003, on said principal sum at said office or agency,
in like coin or currency, at the rate per annum of 4.0%, from the June 15 or
December 15, as the case may be, next preceding the date of this Note to which
interest has been paid or duly provided for, unless the date hereof is a date to
which interest has been paid or duly provided for, in which case from the date
of this Note, or unless no interest has been paid or duly provided for on the
Notes, in which case from December 23, 2002 until payment of said principal sum
has been made or duly provided for. Notwithstanding the foregoing, if the date
hereof is after any June 1 or December 1, as the case may be, and before the
following June 15 or December 15, this Note shall bear interest from such June
15 or December 15. Contingent interest, if any, will accrue for any six month
interest period from December 15 to June 14 and from June 15 to December 14,
with the initial six-month period commencing December 15, 2007, and be payable
on the interest payment date immediately following such six month interest
period to the person in whose name this Note is registered on the Note register
at the close of business on the applicable record date for such interest payment
date. Except as otherwise provided in the Indenture, the interest payable on the
Note pursuant to the Indenture on any June 15 or December 15 will be paid to the
Person entitled thereto as it appears in the Note register at the close of
business on the record date, which shall be the June 1 or December 1 (whether or
not a Business Day) next preceding such June 15 or December 15, as provided in
the Indenture; provided that any such interest not punctually paid or duly
provided for shall be payable as provided in the Indenture. The Company shall
pay interest (i) on any Notes in certificated form by check mailed to the
address of the Person entitled thereto as it appears in the Note register or
(ii) on any Global Note by wire transfer of immediately available funds to the
account of the Depositary or its nominee.

      The Company promises to pay interest at the rate of 5.0% per annum on
overdue principal, premium, if any, and (to the extent that payment of such
interest is enforceable under applicable law) interest on the Notes.

----------

      (2) For Global Notes only.


                                       A-3
<PAGE>
      Reference is made to the further provisions of this Note set forth on the
reverse hereof, including, without limitation, provisions giving the holder of
this Note the right to convert this Note into Common Stock of the Company on the
terms and subject to the limitations referred to on the reverse hereof and as
more fully specified in the Indenture. Such further provisions shall for all
purposes have the same effect as though fully set forth at this place.

      This Note shall be deemed to be a contract made under the laws of the
State of New York, and for all purposes shall be construed in accordance with
and governed by the laws of the State of New York, without regard to conflicts
of laws principles thereof.

      This Note shall not be valid or become obligatory for any purpose until
the certificate of authentication hereon shall have been manually signed by the
Trustee or a duly authorized authenticating agent under the Indenture.


                                       A-4
<PAGE>
      IN WITNESS WHEREOF, the Company has caused this Note to be duly executed.

                                       STEEL DYNAMICS, INC.

                                       By: _______________________________

                                       By: _______________________________

TRUSTEE'S CERTIFICATE OF AUTHENTICATION

This is one of the Notes described in the within-named Indenture.

FIFTH THIRD BANK, INDIANA, as Trustee


By: _______________________________
    Authorized Signatory

                            ,or

By: _______________________________
    As Authenticating Agent
    (if different from Trustee)



      By: _________________________
          Authorized Signatory


                                       A-5
<PAGE>
                             FORM OF REVERSE OF NOTE

                              STEEL DYNAMICS, INC.

                      4% CONVERTIBLE SUBORDINATED NOTE 2012

      This Note is one of a duly authorized issue of Notes of the Company,
designated as its 4% Convertible Subordinated Notes Due 2012 (herein called the
"NOTES"), limited in aggregate principal amount to $100,000,000 (or in the event
that the Initial Purchasers exercise their option under the Note Purchase
Agreement to purchase additional Notes, to an aggregate principal amount not to
exceed $125,000,000) issued and to be issued under and pursuant to an Indenture
dated as of December 23, 2002 (herein called the "INDENTURE"), between the
Company and Fifth Third Bank, Indiana, as trustee (herein called the "TRUSTEE"),
to which Indenture and all indentures supplemental thereto reference is hereby
made for a description of the rights, limitations of rights, obligations, duties
and immunities thereunder of the Trustee, the Company and the holders of the
Notes.

      In case an Event of Default shall have occurred and be continuing, the
principal of, premium, if any, and accrued interest, including contingent
interest, if any, on all Notes may be declared by either the Trustee or the
holders of not less than 25% in aggregate principal amount of the Notes then
outstanding, and upon said declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.

      The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the holders of at least a majority in aggregate principal
amount of the Notes at the time outstanding, to execute supplemental indentures
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or of any supplemental indenture or modifying in any
manner the rights of the holders of the Notes; provided that no such
supplemental indenture shall (i) extend the fixed maturity of any Note, or
reduce the rate or extend the time of payment of interest, including contingent
interest, if any, thereon, or reduce the principal amount thereof or premium, if
any, thereon, or reduce any amount payable upon redemption or repurchase
thereof, or impair the right of any Noteholder to institute suit for the payment
thereof, or make the principal thereof or interest or premium, if any, thereon
payable in any coin or currency other than that provided in the Notes, or change
the obligation of the Company to redeem any Note on a redemption date in a
manner adverse to the holders or change the obligation of the Company to redeem
any Note upon the happening of a Fundamental Change in a manner adverse to the
holder of the Notes, or change the obligation of the Company to repurchase any
Note on a Repurchase Date in a manner adverse to the holder of the Notes, or
impair the right to convert the Notes into Common Stock subject to the terms set
forth in the Indenture, including Section 15.06 thereof, or modify, in any
material respect, the subordination provisions of Article 16 in any manner
adverse to the holders of the Notes without the consent of the holder of each
Note so affected, or modify any of the provisions of Section 11.02 or Section
7.07 thereof, except to increase any such percentage or to provide that certain
other provisions of the Indenture cannot be modified or waived without the
consent of the holder of each Note so affected, or change any obligation of the
Company to maintain an office or agency in the places and for the purposes set
forth in Section 5.01 thereof, or reduce the quorum or voting


                                       A-6
<PAGE>
requirements set forth in Article 10 or (ii) reduce the aforesaid percentage of
Notes, the holders of which are required to consent to any such supplemental
indenture, without the consent of the holders of all Notes then outstanding.
Subject to the provisions of the Indenture, the holders of a majority in
aggregate principal amount of the Notes at the time outstanding may on behalf of
the holders of all of the Notes waive any past default or Event of Default under
the Indenture and its consequences except (A) a default in the payment of
interest, or any premium on, or the principal of, any of the Notes, (B) a
failure by the Company to convert any Notes into Common Stock of the Company,
(C) a default in the payment of the redemption price pursuant to Article 3 of
the Indenture, (D) a default in the payment of the repurchase price pursuant to
Article 3 of the Indenture, or (E) a default in respect of a covenant or
provisions of the Indenture which under Article 11 of the Indenture cannot be
modified or amended without the consent of the holders of each or all Notes then
outstanding or affected thereby. Any such consent or waiver by the holder of
this Note (unless revoked as provided in the Indenture) shall be conclusive and
binding upon such holder and upon all future holders and owners of this Note and
any Notes which may be issued in exchange or substitution hereof, irrespective
of whether or not any notation thereof is made upon this Note or such other
Notes.

      No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and
interest, including contingent interest, if any, or on this Note at the place,
at the respective times, at the rate and in the coin or currency herein
prescribed.

      Interest on the Notes shall be computed on the basis of a 360-day year of
twelve 30-day months.

      The Notes are issuable in fully registered form, without coupons, in
denominations of $1,000 principal amount and any multiple of $1,000. At the
office or agency of the Company referred to on the face hereof, and in the
manner and subject to the limitations provided in the Indenture, without payment
of any service charge but with payment of a sum sufficient to cover any tax,
assessment or other governmental charge that may be imposed in connection with
any registration or exchange of Notes, Notes may be exchanged for a like
aggregate principal amount of Notes of any other authorized denominations.

      At any time on or after December 18, 2007 and prior to maturity, the Notes
may be redeemed at the option of the Company, in whole or in part, upon mailing
a notice of such redemption not less than 30 days but not more than 60 days
before the redemption date to the holders of Notes at their last registered
addresses, all as provided in the Indenture, at the following optional
redemption prices (expressed as percentages of the principal amount), together
in each case with accrued and unpaid interest, including contingent interest, if
any, to, but excluding, the redemption date:

<TABLE>
<CAPTION>
REDEMPTION PERIOD                                               REDEMPTION PRICE
-----------------                                               ----------------
<S>                                                             <C>
Beginning on December 18, 2007 and ending on December 14, 2008      101.143%
Beginning on December 15, 2008 and ending on December 14, 2009      100.571%
</TABLE>


                                      A-7
<PAGE>
and 100% if redeemed on or after December 15, 2009; provided that if the
redemption date is on a June 15 or December 15, then the interest payable on
such date shall be paid to the holder of record on the preceding June 1 or
December 1, respectively.

      The Company may not give notice of any redemption of the Notes if a
default in the payment of interest, or premium, if any, on the Notes has
occurred and is continuing.

      The Notes are not subject to redemption through the operation of any
sinking fund.

      If a Fundamental Change occurs at any time prior to maturity of the Notes,
this Note will be redeemable on a Fundamental Change Redemption Date, 30 days
after notice thereof, at the option of the holder of this Note at a redemption
price equal to 100% of the principal amount thereof, together with accrued
interest to (but excluding) the redemption date; provided that if such
Fundamental Change Redemption Date is a June 15 or December 15, the interest
payable on such date shall be paid to the holder of record of this Note on the
preceding June 1 or December 1, respectively. The Notes will be redeemable in
multiples of $1,000 principal amount. The Company shall mail to all holders of
record of the Notes a notice of the occurrence of a Fundamental Change and of
the redemption right arising as a result thereof on or before the 10th day after
the occurrence of such Fundamental Change. For a Note to be so redeemed at the
option of the holder, the Company must receive at the office or agency of the
Company maintained for that purpose in accordance with the terms of the
Indenture, such Note with the form entitled "OPTION TO ELECT REPAYMENT UPON A
FUNDAMENTAL CHANGE" on the reverse thereof duly completed, together with such
Note, duly endorsed for transfer, on or before the 30th day after the date of
such notice of a Fundamental Change (or if such 30th day is not a Business Day,
the immediately succeeding Business Day).

      Subject to the terms and conditions of the Indenture, the Company shall
become obligated to purchase, at the option of the holder, all or any portion of
the Notes held by such holder on December 15, 2009 in whole multiples of $1,000
at a purchase price of 100% of the principal amount, on such Note. Any accrued
and unpaid interest on any Note tendered for repurchase on December 15, 2009
shall be paid to the holder of record of such Note on December 1, 2009. To
exercise such right, a holder shall deliver to the Company such Note with the
form entitled "REPURCHASE NOTICE" on the reverse thereof duly completed,
together with the Note, duly endorsed for transfer, at any time from the opening
of business on the date that is 20 Business Days prior to such Repurchase Date
until the close of business on the Repurchase Date, and shall deliver the Notes
to the Trustee (or other paying agent appointed by the Company) as set forth in
the Indenture.

      Holders have the right to withdraw any Repurchase Notice by delivering to
the Trustee (or other paying agent appointed by the Company) a written notice of
withdrawal up to the close of business on the Repurchase Date, all as provided
in the Indenture.

      If cash, sufficient to pay the purchase price of all Notes or portions
thereof to be purchased as of the Repurchase Date is deposited with the Trustee
(or other paying agent appointed by the Company), on the Business Day following
the Repurchase Date, interest will cease to accrue on such Notes (or portions
thereof) immediately after such Repurchase Date, and


                                       A-8
<PAGE>
the holder thereof shall have no other rights as such other than the right to
receive the purchase price upon surrender of such Note.

      Subject to the occurrence of certain events and in compliance with the
provisions of the Indenture, prior to 5:00 p.m. (New York City time) on the
final maturity date of the Notes, the holder hereof has the right, at its
option, to convert each $1,000 principal amount of the Notes into 58.8076 shares
of the Company's Common Stock, as such shares shall be constituted at the date
of conversion and subject to adjustment from time to time as provided in the
Indenture, upon surrender of this Note with the form entitled "CONVERSION
NOTICE" on the reverse thereof duly completed, to the Company at the office or
agency of the Company maintained for that purpose in accordance with the terms
of the Indenture, or at the option of such holder, the Corporate Trust Office,
and, unless the shares issuable on conversion are to be issued in the same name
as this Note, duly endorsed by, or accompanied by instruments of transfer in
form satisfactory to the Company duly executed by, the holder or by his duly
authorized attorney. The Company will notify the holder thereof of any event
triggering the right to convert the Notes as specified above in accordance with
the Indenture.

      No adjustment in respect of interest on any Note converted or dividends on
any shares issued upon conversion of such Note will be made upon any conversion
except as set forth in the next sentence. If this Note (or portion hereof) is
surrendered for conversion during the period from the close of business on any
record date for the payment of interest to the close of business on the Business
Day preceding the following interest payment date and has not been called for
redemption by the Company on a redemption date that occurs during such period,
this Note (or portion hereof being converted) must be accompanied by payment, in
immediately available funds or other funds acceptable to the Company, of an
amount equal to the interest otherwise payable on such interest payment date on
the principal amount being converted; provided that no such payment shall be
required if there shall exist at the time of conversion a default in the payment
of interest, including contingent interest, if any, on the Notes.

      No fractional shares will be issued upon any conversion, but an adjustment
and payment in cash will be made, as provided in the Indenture, in respect of
any fraction of a share which would otherwise be issuable upon the surrender of
any Note or Notes for conversion.

      A Note in respect of which a holder is exercising its right to require
redemption upon a Fundamental Change or repurchase on a Repurchase Date may be
converted only if such holder withdraws its election to exercise either such
right in accordance with the terms of the Indenture.

      Any Notes called for redemption, unless surrendered for conversion by the
holders thereof on or before the close of business on the Business Day preceding
the redemption date, may be deemed to be redeemed from the holders of such Notes
for an amount equal to the applicable redemption price, together with accrued
but unpaid interest to, but excluding, the date fixed for redemption, by one or
more investment banks or other purchasers who may agree with the Company (i) to
purchase such Notes from the holders thereof and convert them into shares of the
Company's Common Stock and (ii) to make payment for such Notes as aforesaid to
the Trustee in trust for the holders.


                                       A-9
<PAGE>
      Upon due presentment for registration of transfer of this Note at the
office or agency of the Company maintained for that purpose in accordance with
the terms of the Indenture, a new Note or Notes of authorized denominations for
an equal aggregate principal amount will be issued to the transferee in exchange
thereof, subject to the limitations provided in the Indenture, without charge
except for any tax, assessment or other governmental charge imposed in
connection therewith.

      The Company, the Trustee, any authenticating agent, any paying agent, any
conversion agent and any Note registrar may deem and treat the registered holder
hereof as the absolute owner of this Note (whether or not this Note shall be
overdue and notwithstanding any notation of ownership or other writing hereon
made by anyone other than the Company or any Note registrar) for the purpose of
receiving payment hereof, or on account hereof, for the conversion hereof and
for all other purposes, and neither the Company nor the Trustee nor any other
authenticating agent nor any paying agent nor other conversion agent nor any
Note registrar shall be affected by any notice to the contrary. All payments
made to or upon the order of such registered holder shall, to the extent of the
sum or sums paid, satisfy and discharge liability for monies payable on this
Note.

      No recourse for the payment of the principal of or any premium or interest
on this Note, or for any claim based hereon or otherwise in respect hereof, and
no recourse under or upon any obligation, covenant or agreement of the Company
in the Indenture or any supplemental indenture or in any Note, or because of the
creation of any indebtedness represented thereby, shall be had against any
incorporator, stockholder, employee, agent, officer or director or subsidiary,
as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law or by
the enforcement of any assessment or penalty or otherwise, all such liability
being, by acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released.

      This Note shall be deemed to be a contract made under the laws of New
York, and for all purposes shall be construed in accordance with the laws of New
York, without regard to conflicts of laws principles thereof.

      Terms used in this Note and defined in the indenture are used herein as
therein defined.


                                      A-10
<PAGE>
                                  ABBREVIATIONS

      The following abbreviations, when used in the inscription of the face of
this Note, shall be construed as though they were written out in full according
to applicable laws or regulations.

<TABLE>
<S>        <C>                                           <C>
TEN COM -  as tenants in common                          UNIF GIFT MIN ACT - ___ Custodian ___
TEN ENT -  as tenant by the entireties                   (Gust)   (Minor)
JT TEN -   as joint tenants with right of survivorship   under Uniform Gifts to Minors Act
           and not as tenants in common                  _______________________________
                                                                  (State)
</TABLE>

      Additional abbreviations may also be used though not in the above list.
<PAGE>
                                CONVERSION NOTICE

TO:   STEEL DYNAMICS, INC.
      FIFTH THIRD BANK, INDIANA

      The undersigned registered owner of this Note hereby irrevocably exercises
the option to convert this Note, or the portion thereof (which is $1,000 or a
multiple thereof) below designated, into shares of Common Stock of Steel
Dynamics, Inc. in accordance with the terms of the Indenture referred to in this
Note, and directs that the shares issuable and deliverable upon such conversion,
together with any check in payment for fractional shares and any Notes
representing any unconverted principal amount hereof, be issued and delivered to
the registered holder hereof unless a different name has been indicated below.
Capitalized terms used herein but not defined shall have the meanings ascribed
to such terms in the Indenture. If shares or any portion of this Note not
converted are to be issued in the name of a person other than the undersigned,
the undersigned will provide the appropriate information below and pay all
transfer taxes payable with respect thereto. Any amount required to be paid by
the undersigned on account of interest, including contingent interest, if any,
accompanies this Note.

Dated:___________________________

                                        ________________________________________

                                        ________________________________________
                                        Signature(s)


                                        Signature(s) must be guaranteed by an
                                        "ELIGIBLE GUARANTOR INSTITUTION" meeting
                                        the requirements of the Note registrar,
                                        which requirements include membership or
                                        participation in the Security Transfer
                                        Agent Medallion Program ("STAMP") or
                                        such other "SIGNATURE GUARANTEE PROGRAM"
                                        as may be determined by the Note
                                        registrar in addition to, or in
                                        substitution for, STAMP, all in
                                        accordance with the Securities Exchange
                                        Act of 1934, as amended.

                                        ________________________________________
                                        Signature Guarantee

      Fill in the registration of shares of Common Stock if to be issued, and
Notes if to be delivered, other than to and in the name of the registered
holder:

________________________________
(Name)
<PAGE>
_________________________________
(Street Address)


_________________________________
(City, State and Zip Code)


_________________________________
Please print name and address

Principal amount to be converted
(if less than all):

$________________________________

Social Security or Other Taxpayer
Identification Number:


_________________________________
<PAGE>
                           OPTION TO ELECT REDEMPTION
                           UPON A FUNDAMENTAL CHANGE

TO:   STEEL DYNAMICS, INC.
      FIFTH THIRD BANK, INDIANA

      The undersigned registered owner of this Note hereby irrevocably
acknowledges receipt of a notice from Steel Dynamics, Inc. (the "COMPANY") as to
the occurrence of a Fundamental Change with respect to the Company and requests
and instructs the Company to redeem the entire principal amount of this Note, or
the portion thereof (which is $1,000 or a multiple thereof) below designated, in
accordance with the terms of the Indenture referred to in this Note at the price
of 100% of such entire principal amount or portion thereof, together with
accrued interest to, but excluding, the Fundamental Change Redemption Date, to
the registered holder hereof. Capitalized terms used herein but not defined
shall have the meanings ascribed to such terms in the Indenture.

Dated:___________________________

                                        ________________________________________

                                        ________________________________________
                                        Signature(s)


                                        NOTICE: The above signatures of the
                                        holder(s) hereof must correspond with
                                        the name as written upon the face of the
                                        Note in every particular without
                                        alteration or enlargement or any change
                                        whatever.

                                        Principal amount to be repaid (if less
                                        than all):

                                        ________________________________________

                                        ________________________________________
                                        Social Security or Other Taxpayer
                                        Identification Number
<PAGE>
                                REPURCHASE NOTICE

TO:   STEEL DYNAMICS, INC.
      FIFTH THIRD BANK, INDIANA

      The undersigned registered owner of this Note hereby irrevocably
acknowledges receipt of a notice from Steel Dynamics, Inc. (the "COMPANY")
regarding the right of holders to elect to require the Company to repurchase the
Notes and requests and instructs the Company to repay the entire principal
amount of this Note, or the portion thereof (which is $1,000 or an integral
multiple thereof) below designated, in accordance with the terms of the
Indenture at the price of 100% of such entire principal amount or portion
thereof, together with accrued interest to, by excluding, the Repurchase Date,
to the registered holder hereof. Capitalized terms used herein but not defined
shall have the meanings ascribed to such terms in the Indenture. The Notes shall
be repurchased by the Company as of the Repurchase Date pursuant to the terms
and conditions specified in the Indenture. If the Company elects to pay the
purchase price, in whole or in part, in shares of Common Stock but such portion
of the purchase price shall ultimately be paid to such holder entirely in cash
because any of the conditions to payment of the purchase price in shares of
Common Stock is not satisfied prior to the close of business on the applicable
Repurchase Date, the undersigned registered owner elects:

[ ]   to withdraw this Repurchase Notice as to $[ ] principal amount of the
Notes to which this Repurchase Notice relates (Certificate Numbers: ), or

[ ]   to receive cash in respect of $[ ] principal amount of the Notes to which
this Repurchase Notice relates.

      Dated:

      Signature(s):

      NOTICE: The above signatures of the holder(s) hereof must correspond with
the name as written upon the face of the Note in every particular without
alteration or enlargement or any change whatever.

      Note Certificate Number (if applicable):

      Principal amount to be repurchased (if less than all):

      Social Security or Other Taxpayer Identification Number:
<PAGE>
                                   ASSIGNMENT

      For value received __________________________________ hereby sell(s)
assign(s) and transfer(s) unto __________________________________ (Please insert
social security or other Taxpayer Identification Number of assignee) the within
Note, and hereby irrevocably constitutes and appoints __________________________
attorney to transfer said Note on the books of the Company, with full power of
substitution in the premises.

      In connection with any transfer of the Note prior to the expiration of the
holding period applicable to sales thereof under Rule 144(k) under the
Securities Act (or any successor provision) (other than any transfer pursuant to
a registration statement that has been declared effective under the Securities
Act), the undersigned confirms that such Note is being transferred:

      [ ]   To Steel Dynamics, Inc. or a subsidiary thereof; or

      [ ]   To a "QUALIFIED INSTITUTIONAL BUYER" in compliance with Rule 144A
            under the Securities Act of 1933, as amended; or

      [ ]   Pursuant to and in compliance with Rule 144 under the Securities
            Act of 1933, as amended; or

      [ ]   Pursuant to a Registration Statement which has been declared
            effective under the Securities Act of 1933, as amended, and which
            continues to be effective at the time of transfer;

and unless the Note has been transferred to Steel Dynamics, Inc. or a subsidiary
thereof, the undersigned confirms that such Note is not being transferred to an
"AFFILIATE" of the Company as defined in Rule 144 under the Securities Act of
1933, as amended.

      Unless one of the boxes is checked, the Trustee will refuse to register
any of the Notes evidenced by this certificate in the name of any person other
than the registered holder thereof.

Dated:___________________________

                                        ________________________________________

                                        ________________________________________
                                        Signature(s)


                                        Signature(s) must be guaranteed by an
                                        "ELIGIBLE GUARANTOR INSTITUTION" meeting
                                        the requirements of the Note registrar,
                                        which requirements include membership or
                                        participation in the Security Transfer
                                        Agent Medallion Program ("STAMP") or
                                        such other "SIGNATURE GUARANTEE PROGRAM"
                                        as may be determined by the Note
                                        registrar in addition to, or in
                                        substitution for, STAMP, al in
                                        accordance
<PAGE>
                                        with the Securities Exchange Act of
                                        1934, as amended.


                                        -----------------------------------
                                        Signature Guarantee


NOTICE: The signature on the Conversion Notice, the Option to Elect Redemption
upon a Fundamental Change, the Repurchase Notice or the Assignment must
correspond with the name as written upon the face of the Note in every
particular without alteration or enlargement or any change whatever.
<PAGE>
                                                                      Schedule I

                  [Include Schedule I only for a Global Note]

                              STEEL DYNAMICS, INC.
                    4% Convertible Subordinated Note Due 2012

No. _______

<TABLE>
<CAPTION>
================================================================================
                                                            Authorized Signature
                            Notation Explaining Principal   of Trustee or
Date  Principal Amount      Amount Recorded                 Custodian
----  --------------------  ------------------------------  --------------------
<S>   <C>                   <C>                             <C>

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------

----  --------------------  ------------------------------  --------------------
</TABLE>


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-5.1
<SEQUENCE>5
<FILENAME>y84184exv5w1.txt
<DESCRIPTION>OPINION OF BARRETT & MCNAGNY LLP
<TEXT>
<PAGE>
                                                                    Exhibit 5.1


[Letterhead of Barrett & McNagny LLP]


March 7, 2003


Steel Dynamics, Inc.
6714 Pointe Inverness Way, Suite 200
Fort Wayne, IN  46804

RE:     $115,000,000 AGGREGATE PRINCIPAL AMOUNT OF 4% CONVERTIBLE SUBORDINATED
        NOTES DUE 2012 AND COMMON STOCK ISSUABLE UPON CONVERSION OF THE NOTES

Gentlemen:

We are legal counsel to Steel Dynamics, Inc. (the "Company"). We refer to the
Registration Statement on Form S-3 (the "Registration Statement") being filed by
the Company with the Securities and Exchange Commission (the "SEC") under the
Securities Act of 1933, as amended (the "Securities Act"), to register (i) up to
$115,000,000 aggregate principal amount of the Company's 4% Convertible
Subordinated Notes due 2012 (the Notes") and (ii) shares of the Company's common
stock, par value $0.01 per share (the "Conversion Shares"), issuable upon
conversion of the Notes. The Notes and Conversion Shares are referred to herein
collectively as the "Securities."

The Notes were issued pursuant to an Indenture dated as of December 23, 2002
(the "Indenture") between the Company and Fifth Third Bank, Indiana, as trustee.
The Notes were issued and sold on December 23, 2002 to Morgan Stanley & Co.
Incorporated, et al, as initial purchasers thereof (the "Initial Purchaser"),
without registration under the Securities Act, and were offered and sold by the
Initial Purchaser to qualified institutional buyers in reliance on Rule 144A
under the Securities Act. In connection with the offer and sale of the Notes,
the Company entered into a Registration Rights Agreement dated as of December
23, 2002 (the "Registration Rights Agreement") with the Initial Purchaser,
providing for the registration of the Securities. The Registration Statement is
being filed pursuant to the Registration Rights Agreement.

We are familiar with the proceedings to date with respect to the issuance of the
Securities and have examined such records, documents and questions of law, and
satisfied ourselves as to such matters of fact as we have considered relevant
and necessary as a basis for this opinion.

In rendering the opinions expressed below, we have assumed the authenticity of
all documents submitted to us as originals and the conformity to the originals
of all documents submitted to us as copies. In addition, we have assumed and
have not verified the accuracy as to factual matters of each document we
reviewed.
<PAGE>

         Based on the foregoing, we are of the opinion that:

         1.       The Company is duly incorporated and validly existing under
                  the laws of the State of Indiana.

         2.       The Notes have been duly authorized and legally issued and
                  constitute valid and binding obligations of the Company
                  (except to the extent enforceability may be limited by
                  applicable bankruptcy, insolvency, reorganization, moratorium,
                  fraudulent transfer or other similar laws affecting the
                  enforcement of creditors' rights generally and by the effect
                  of general principles of equity, regardless of whether
                  enforceability is considered in a proceeding in equity or at
                  law).

         3.       The Conversion Shares have been duly authorized and will be
                  legally issued, fully paid and nonassessable when certificates
                  representing the Conversion Shares shall have been duly
                  executed, countersigned and registered and duly delivered to
                  the persons entitled thereto upon conversion of the Notes in
                  accordance with the terms of the Indenture.

This opinion letter is limited to the general corporation laws of the State of
Indiana and the federal laws of the United States of America. We express no
opinions as to any other laws, statutes or regulations.

We hereby consent to the filing of this opinion letter as an Exhibit to the
Registration Statement and to all references to us under the caption "Legal
Matters" in the Prospectus forming a part of the Registration Statement. In
giving such consent, we do not thereby admit that we are within the category of
persons whose consent is required by Section 7 of the Securities Act or the
related rules and regulations promulgated by the SEC.

Very truly yours,

BARRETT & McNAGNY LLP

/S/  Robert S. Walters, Partner



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-8.1
<SEQUENCE>6
<FILENAME>y84184exv8w1.txt
<DESCRIPTION>OPINION OF SIDLEY AUSTIN BROWN & WOOD LLP
<TEXT>
<PAGE>
                                                                    Exhibit 8.1

[Letterhead of Sidley Austin Brown & Wood LLP]


Steel Dynamics, Inc.                                              March 7, 2003
6714 Pointe Inverness Way
Suite 200
Fort Wayne, Indiana 46804
                            Re: Steel Dynamics, Inc.
                                4% Convertible Subordinated Notes due 2012
                                ------------------------------------------
Ladies and Gentlemen:

                  We have acted as special tax counsel to Steel Dynamics, Inc.,
an Indiana corporation (the "Company"), in connection with the preparation and
filing with the Securities and Exchange Commission under the Securities Act of
1933, as amended, of the Company's Registration Statement on Form S-3 (the
"Registration Statement"), of which the preliminary Prospectus forms a part (the
"Prospectus"). The Registration Statement relates to $115,000,000 aggregate
principal amount at maturity of the Company's 4% Convertible Subordinated Notes
due December 15, 2012 (the "Notes") and shares of the Company's common stock
issuable upon conversion thereof and certain additional shares of the Company's
common stock. The Notes were issued pursuant to an Indenture, dated as of
December 23, 2002 (the "Indenture"), between the Company and Fifth Third Bank,
Indiana as trustee.

                  As special tax counsel to the Company, we have made such legal
and factual examinations and inquiries and obtained such advice, assurances, and
certificates as we have deemed necessary and advisable under the circumstances
in order to render this opinion, including, but not limited to, an examination
of originals or copies of the following:

                  (a)      the Registration Statement and Prospectus;

                  (b)      the Purchase Agreement, dated as of December 17,
                           2002, between the Company and Morgan Stanley & Co.
                           Incorporated and Goldman, Sachs & Co. (the "Initial
                           Purchasers");

                  (c)      the Indenture;

                  (d)      the form of the Notes, as attached as an exhibit to
                           the Indenture; and

                  (e)      the Registration Rights Agreement, dated as of
                           December 23, 2002, between the Company and the
                           Initial Purchasers.

The term "Documents" as used in this opinion letter refers to the documents
listed in paragraphs (b) through (e) above.

                  In our examinations, we have assumed the legal capacity of all
natural persons, the genuineness of all signatures, the authenticity of original
and certified documents, and the conformity to original or certified documents
of all copies submitted to us as conformed or reproduced copies. As to various
questions of fact relevant to the opinions expressed herein, we have relied
<PAGE>

upon, and assume the accuracy of, the representations and warranties contained
in the Documents and certificates and oral and written statements and other
information of or from representatives of the Company, its subsidiaries, and
others and assume compliance on the part of all parties to the Documents with
their covenants and agreements contained therein. To the extent it may be
relevant to the opinions expressed herein, we have assumed that parties to the
Documents other than the Company have the power to enter into and perform such
agreements and that such agreements have been duly authorized, executed, and
delivered by such other parties and constitute legal, valid, and binding
obligations of such other parties, enforceable against such parties in
accordance with their terms, and that such parties will comply with all other
obligations under the Documents and all laws applicable thereto.

                  On the basis of the foregoing, the Company's representation
that, as of the issue date of the Notes, the likelihood of a contingent interest
payment being made on the Notes during the term of the Notes is not remote, the
Company's representation that, as of the issue date of the Notes, the likelihood
of a contingent interest payment not being made on the Notes during the term of
the Notes is not remote, and certain estimates made by the Company and the
Initial Purchasers regarding the present value of contingent payments, and in
reliance thereon, and subject to the assumptions, qualifications, and
limitations set forth herein, we are of the opinion that:

                  The Notes will be treated as indebtedness of the Company that
are subject to the regulations governing contingent payment debt instruments
that are contained in Treasury Regulation section 1.1275-4(b); the term
"comparable yield" means the annual yield the Company would pay, as of the
initial issue date, on a noncontingent, nonconvertible, fixed-rate debt
instrument with terms and conditions otherwise comparable to those of the Notes;
and the statements in the Prospectus under the caption "Certain United States
Federal Income Tax Considerations", insofar as such statements constitute a
summary of the United States federal tax laws referred to therein, accurately
summarize in all material respects the United States federal tax laws referred
to therein.

                  We express no opinions other than those expressed herein. The
opinions expressed herein are given as of the date hereof, and we undertake no
obligation to supplement this letter if any applicable laws change after the
date hereof or if we become aware of any facts that might change the opinions
expressed herein after the date hereof or for any other reason. This opinion is
provided to you as a legal opinion only and not as a guaranty or warranty of the
matters discussed herein.

                  We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement and to the reference to our name under the caption
"Legal Matters" in the Prospectus. In giving such consent, we do not thereby
admit that we are in the category of persons whose consent is required under
Section 7 of the Securities Act of 1933.

                                             Very truly yours,


                                             Sidley Austin Brown & Wood LLP

                                             /S/  Sidley Austin Brown & Wood LLP


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-12.1
<SEQUENCE>7
<FILENAME>y84184exv12w1.txt
<DESCRIPTION>STATEMENT RE: COMPUTATION OF RATIOS OF EARNINGS
<TEXT>
<PAGE>
                                                                               .
                                                                               .
                                                                               .
                                                                    EXHIBIT 12.1

STEEL DYNAMICS, INC.
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>

                                                                                                             NINE MONTHS ENDED
                                                                                                               SEPTEMBER 30,
                                                 1997         1998         1999         2000         2001         2002
                                              ----------   ----------   ----------   ----------    ----------   ---------
<S>                                           <C>          <C>          <C>          <C>          <C>          <C>
Interest expense, including amortization
   of debt issuance costs .................   $   9,197    $  16,938    $  22,919    $  21,038    $  21,015    $  21,801
Capitalized interest ......................       8,093        5,878       13,196       17,477       13,993       10,699
                                              ---------    ---------    ---------    ---------    ---------    ---------

        Fixed charges (a) .................      17,290       22,816       36,115       38,515       35,008       32,500


Income before taxes and extraordinary items      59,371       52,626       65,279       84,485        5,113       80,842
Plus amortization of capitalized interest .         848        1,138        1,365        1,501        1,597        2,075
Less capitalized interest .................      (8,093)      (5,878)     (13,196)     (17,477)     (13,993)     (10,699)
                                              ---------    ---------    ---------    ---------    ---------    ---------

        Adjusted earnings (b) .............   $  69,416    $  70,702    $  89,563    $ 107,024    $  27,725    $ 104,718
                                              =========    =========    =========    =========    =========    =========

Ratio (b) / (a) ...........................       4.01x        3.10x        2.48x        2.78x        0.79x        3.22x
                                              =========    =========    =========    =========    =========    =========
</TABLE>


For purposes of calculating our ratio of earnings to fixed charges, earnings
consist of earnings from continuing operations before income taxes and
extraordinary items, adjusted for the portion of fixed charges deducted from the
earnings, plus amortization of capitalized interest. Fixed charges consist of
interest on all indebtedness, including capitalized interest, and amortization
of debt issuances costs, excluding amortization of debt issuance costs
classified as extraordinary. In 2001, our earnings were insufficient to cover
our fixed charges by $7.3 million.

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23.3
<SEQUENCE>8
<FILENAME>y84184exv23w3.txt
<DESCRIPTION>CONSENT OF ERNST & YOUNG LLP
<TEXT>
<PAGE>
                                                                    Exhibit 23.3

                         Consent of Independent Auditors

We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and related Prospectus of Steel Dynamics, Inc.
for the registration of $115,000,000 of 4% Convertible Subordinated Notes due
2012 and 7,199,024 shares of its common stock, and to the incorporation by
reference therein of our report dated January 31, 2002 (except for Note 3, as to
which the date is March 26, 2002, and Note 7, as to which the date is March 7,
2002), with respect to the consolidated financial statements of Steel Dynamics,
Inc. included in its Annual Report (Form 10-K) for the year ended December 31,
2001, filed with the Securities and Exchange Commission.


                                                           /S/ Ernst & Young LLP

Fort Wayne, Indiana
March 6, 2003


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-25.1
<SEQUENCE>9
<FILENAME>y84184exv25w1.txt
<DESCRIPTION>FORM T-1 TRUSTEE'S STATEMENT OF ELIGIBILITY
<TEXT>
<PAGE>
                                                                    EXHIBIT 25.1

                                    FORM T-1

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                       Statement of Eligibility Under the
                  Trust Indenture Act of 1939 of a Corporation
                          Designated to Act as Trustee

          CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE
                          PURSUANT TO SECTION 305(B)(2)

                            FIFTH THIRD BANK, INDIANA
                            -------------------------
               (Exact name of trustee as specified in its charter)

                                     Indiana
                                     -------
     (Jurisdiction of incorporation or organization if not a national bank)

                                   38-3307634
                                   ----------
                      (I.R.S. Employer Identification No.)

                    251 N. Illinois Street, Indianapolis, IN
                    ----------------------------------------
                    (Address of principal executive offices)

                                      46204
                                      -----
                                   (Zip Code)

                                Michael J. Alley
                     10327 Windemere, Carmel, Indiana 46032
                     --------------------------------------
            (Name, address and telephone number of agent for service)

                              STEEL DYNAMICS, INC.
                              --------------------
               (Exact name of obligor as specified in its charter)

                                     Indiana
                                     -------
         (State or other jurisdiction of incorporation or organization)

                                   35-19299476
                                   -----------
                      (I.R.S. Employer Identification No.)

            6714 Pointe Inverness Way, Suite 200, Fort Wayne, Indiana
            ---------------------------------------------------------
                    (Address of principal executive offices)

                                      46804
                                      -----
                                   (Zip Code)

                   4% Convertible Subordinated Notes Due 2012
                   ------------------------------------------
                       (Title of the indenture securities)
<PAGE>
ITEM 1.     GENERAL INFORMATION.

            Furnish the following information as to the trustee -

      (a)   Name and address of each examining or supervising authority to which
            it is subject.

            Indiana Department of Financial Institutions
            402 W. Washington St.
            Room W-066
            Indianapolis, IN 462011

            Federal Reserve Bank of Cleveland
            East Sixth Street and Superior Avenue
            Cleveland, Ohio 44101

            Federal Deposit Insurance Corporation,
            Washington, D.C.

      (b)   Whether it is authorized to exercise corporate trust powers.

            Yes.

ITEM 2.     AFFILIATIONS WITH OBLIGOR.

            If the obligor is an affiliate of the trustee, describe each such
            affiliation.

      None.

ITEMS 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 14 AND 15 ARE NOT APPLICABLE BY VIRTUE OF
THE ANSWER TO ITEM 13.

ITEM 13.    DEFAULTS BY THE OBLIGOR.

      (a)   State whether there is or has been a default with respect to the
            securities under this indenture. Explain the nature of any such
            default.

None.

      (b)   If the Trustee is a trustee under another indenture under which any
            other securities, or certificates of interest or participation in
            any other securities, of the obligor are outstanding, or is trustee
            for more than one outstanding series of securities under the
            indenture, state whether there has been a default under any such
            indenture or series, identify the indenture or series affected, and
            explain the nature of any such default.

None.
<PAGE>
ITEM 16.    LIST OF EXHIBITS.

            List below all exhibits filed as a part of this statement of
            eligibility.

      (1)   A copy of the Certificate of Incorporation of the trustee as now in
            effect.

      (2)   A copy of the certificate of authority of the trustee to commence
            business. (Included in Exhibit 1)

      (3)   A copy of the authorization of the trustee to exercise corporate
            trust powers.

      (4)   A copy of the existing code of regulations of the trustee
            incorporating amendments to date.

      (5)   A copy of each indenture referred to in Item 4.

      (6)   The consent of the trustee required by Section 321 (b) of the Trust
            Indenture Act of 1939.

      (7)   A copy of the latest report of condition of the trustee published
            pursuant to law or the requirements of its supervising or examining
            authority.

      (8)   A copy of any order pursuant to which the foreign trustee is
            authorized to act as sole trustee under indentures qualified or to
            be qualified under the Act.

      (9)   Foreign trustees are required to file a consent to service of
            process of Form F-X
<PAGE>
                                    SIGNATURE

            Pursuant to the requirements of the Trust Indenture Act of 1939, the
trustee, Fifth Third Bank, Indiana, a corporation organized and existing under
the laws of the State of Indiana, has duly caused this statement of eligibility
and qualification to be signed on its behalf by the undersigned, thereunto duly
authorized, all in the City of Indianapolis and the State of Indiana, on the
6th day of March, 2003.


                                      FIFTH THIRD BANK, INDIANA


                                      By:  /s/ George L. Bawcum
                                          --------------------------------------

                                      Its: Trust Officer
                                          --------------------------------------
<PAGE>
                                    EXHIBIT 1

                                                                 APPROVED BY THE
                                            DEPARTMENT OF FINANCIAL INSTITUTIONS
                                                         OF THE STATE OF INDIANA

                                                  ------------------------------
                                                           (Date & Seal)

                                                  ------------------------------
                                                             DIRECTOR


                            ARTICLES OF INCORPORATION
                                       OF

                     Fifth Third Bank, Indiana
                     ---------------------------------------
                                  (Name)

                     Indianapolis, Marion County, Indiana
                     ---------------------------------------
                           (City, County and State)

The undersigned being one or more natural persons, all of whom are at least (18)
years of age and at least a majority of whom are citizens of the State of
Indiana, having been designated as incorporators by the subscribers to the
capital stock of the proposed corporation hereafter named do hereby adopt the
following Articles of Incorporation:

                                    ARTICLE I

      Section 1. Conversion. This corporation is formed as the result of the
conversion of

      Old Kent Bank, National Association, Jonesville, Michigan,
---------------------------------------------------------------

a national banking association to a state chartered commercial bank.

Upon conversion, the resulting state chartered commercial bank shall possess all
of the rights, privileges, immunities, and powers of a state chartered
commercial bank, unless otherwise provided in I.C. 28-3-2, is subject to all of
the duties, restrictions, obligations, and liabilities of a state chartered
commercial bank; and succeeds by operation of law to all rights and property of
the converting national association and shall be subject to all debts,
obligations and liabilities of the converting national association as if the
state chartered commercial bank had incurred the debts and liabilities.

     Section 2. Principal Office. The post office address of the principal
office of the corporation shall be 251 North Illinois Street,
                                   ---------------------------------------------
                                                Street/P.O. Box

Indianapolis,                Marion County,            Indiana          45205.
--------------------------------------------------------------------------------
City                         County                    State            Zip Code
<PAGE>
      Section 3. Purpose. The purpose(s) for which this corporation is formed is
(are)  Please see Continuation Sheets
       -------------------------------------------------------------------------

--------------------------------------------------------------------------------

      Section 4. Period of Existence. The period during which the corporation
shall continue is perpetual.

      Section 5. Effective Date of Incorporation. The effective date of these
Articles of Incorporation shall be on/before     Please see Continuation Sheets
                                             -----------------------------------
                                                 Month         Day          Year

                                   ARTICLE II

                                     CAPITAL

      Section 1. Initial Capital. The amount of capital with which the
Corporation will begin business is $4,000,000.00.

      Section 2. Authorized Shares. The total number of shares the Corporation
is to have the authority to issue is 4,000,000.

      Section 3. Terms of Shares. The authorized shares shall be designated as
common stock with a par value of $1.00 per share.

      Section 4. Voting Rights. Unless the Articles of Incorporation provide
otherwise, each outstanding share, regardless of class, is entitled to one (1)
vote on each matter voted on at a shareholders' meeting.

                                   ARTICLE III

                                 INCORPORATOR(S)

The name(s) and post office address(es) of the incorporator(s) is (are) as
follows:

Michael J. Alley                    10327 Windemere, Carmel, Indiana  46032
--------------------------------------------------------------------------------
Name                                             Post Office Box

--------------------------------------------------------------------------------
Name                                             Post Office Box

--------------------------------------------------------------------------------
Name                                             Post Office Box
<PAGE>
                                   ARTICLE IV

                                    DIRECTORS

      Section 1. Number of Directors. The number of Directors of the corporation
shall not be less than three nor greater than 15. The exact number may be
established in the bylaws.

      Section 2. Name of Directors. The names and post office address of each
member of the Board of Directors are as follows:

            Please see Continuation Sheets
--------------------------------------------------------------------------------
Name                                    Post Office Box


--------------------------------------------------------------------------------
Name                                    Post Office Box


--------------------------------------------------------------------------------
Name                                    Post Office Box


--------------------------------------------------------------------------------
Name                                    Post Office Box


--------------------------------------------------------------------------------
Name                                    Post Office Box


--------------------------------------------------------------------------------
Name                                    Post Office Box


--------------------------------------------------------------------------------
Name                                    Post Office Box
<PAGE>
                            ARTICLES OF INCORPORATION
                                       OF
                            FIFTH THIRD BANK, INDIANA
                              INDIANAPOLIS, INDIANA

                               Continuation Sheets

Article I, Section 3, Purpose:

      The purpose for which this corporation is formed is to:

            Conduct and carry on the business of the bank incorporated under the
            laws of the State of Indiana and to transact any and all business
            which such corporations are authorized and empowered to transact
            under any and all of the provisions of the laws of Indiana, with all
            the powers and privileges and subject to all the duties,
            restrictions and liabilities set forth in the general laws relating
            to such corporations and all acts in amendment thereof or
            supplemental thereto.

Article I, Section 5, Effective Date of Incorporation:

      The effective date of these Articles of Incorporation shall be on May 29,
2001. For purposes of I.C. 28-2-17-20.1 and in accordance with the National Bank
Act, 12 U.S.C. Section 214b, the corporation, upon conversion, shall be
considered the same business and corporate entity as the national banking
association formerly known as Old Kent Bank, National Association, whose
existence commenced on March 1, 1997, although as to rights, powers, and duties
the resulting bank is a state bank.

Article IV, Section 2. Names of Directors.

      The names and post office address of each member of the Board of Directors
are as follows:

NAME                                   ADDRESS
----                                   -------

Adams, Marlin D.                       Pro-Form Plastics, Inc.
                                       2514 Chestnut Street
                                       Columbus, IN 47201

Alley, Michael James                   10327 Windemere
                                       Carmel, IN 46032

Eberle, Frank J.                       First Insurance Group, Inc.
                                       1405 N. College Ave.
                                       Bloomington, IN  47404
<PAGE>
Grossnickle, Ted                       Johnson, Grossnickle & Associates
                                       P.O. Box 576
                                       Franklin, IN  46131

McWhirter, William                     Fifth Third Bank, Indiana
                                       251 N. Illinois St., Suite 1000
                                       Indianapolis, IN  46204

Myers, Donald Leroy                    Poindexter Excavating, Inc.
                                       10445 E. 56th St.
                                       Indianapolis, IN  46236

Perry, Eston L.                        Oakley Corporation

                                       8 South 16th St.
                                       Terre Haute, IN  47807

Slash, Joseph                          IPALCO Enterprises, Inc.
                                       P.O. Box 1595
                                       Indianapolis, IN 46206

James Bawden Sturges                   1214 East State Rd. 46
                                       Greensburg, IN  47240

Jeffrey Wilson                         Purdue Research Foundation
                                       3000 Kent Ave., Suite C2-100
                                       West Lafayette, IN  47906

William C. Wilson                      Central Funk Insurance Company
                                       523 Central Avenue
                                       Connersville, IN  47331

Gerald L. Wissel                       Fifth Third Bancorp
                                       38 Fountain Square Plaza
                                       Cincinnati, Ohio 45263

      Each director shall serve until the next annual meeting of shareholders
and until his or her respective successor is duly elected and qualified or until
his or her earlier resignation or removal.

Article V. Provisions for Regulation of Business and Conduct of Corporation.

      The corporation may indemnify any director, officer, employee or their
heirs, executors, or administrators to the fullest extent permitted by law
according to the provisions set forth in the By-laws of the corporation.
<PAGE>


                                    ARTICLE V

                      PROVISIONS FOR REGULATION OF BUSINESS
                      AND CONDUCT OF AFFAIRS OF CORPORATION

Any other provisions, consistent with the laws of Indiana, for the regulation of
the business and conduct of the affairs of the corporation.

Please see Continuation Sheets
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

The undersigned incorporator(s) represent to the Indiana Department of Financial
Institutions and the Indiana Secretary of State that prior to the execution of
these articles the subscribers to the capital stock of this corporation fully
complied with the accompanying requisites contained in IC 28-12-4-1 and IC
28-3-2.

In witness I (we) have signed this


    22     day of     May, 2001   .
----------         ---------------


                                             -----------------------------------
                                                       (Incorporator)


                                             -----------------------------------
                                                       (Incorporator)


                                             -----------------------------------
                                                       (Incorporator)
<PAGE>
STATE OF INDIANA        )
                        ) SS:
COUNTY OF MARION        )


The undersigned, a Notary Public, certifies that         Michael J. Alley
                                                 -------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
being     the sole     the incorporator(s) referred to in the Articles of
      ----------------
Incorporation, personally appeared before me, acknowledged the execution and
swore to the truth of the facts stated.


WITNESS MY SIGNATURE THIS     22ND     DAY OF    MAY, 2001   .
                          ------------        ---------------



                                             -----------------------------------
                                                      Witness Signature


                                             -----------------------------------
                                                      Printed Signature

My commission expires on         March           18th             2007        .
                         -----------------------------------------------------
                                 Month           Day              Year



This instrument was prepared by     William E. Stern, Esq., Goodwin Procter LLP
                                ------------------------------------------------

Attorney at Law,      Exchange Place,       Boston,      Massachusetts     02109
                 ---------------------------------------------------------------
                      Address               City         State             Zip


The above Articles of Incorporation must be prepared and signed in quadruplicate
by all of the incorporators and must be acknowledged by the incorporators before
a notary public. The articles must be submitted in quadruplicate to the
Department of Financial Institutions of Indiana for approval.
<PAGE>
                                    EXHIBIT 2

                         CERTIFICATE OF AUTHORITY OF THE
                          TRUSTEE TO COMMENCE BUSINESS
                             (INCLUDED IN EXHIBIT 1)
<PAGE>
                                    EXHIBIT 3

                   A COPY OF THE AUTHORIZATION OF THE TRUSTEE
                       TO EXERCISE CORPORATE TRUST POWERS

                                 [See Attached]


<PAGE>
                                STATE OF INDIANA

                      DEPARTMENT OF FINANCIAL INSTITUTIONS

      I, CHARLES W. PHILLIPS , DIRECTOR of the DEPARTMENT OF FINANCIAL
INSTITUTIONS, of the State of Indiana, hereby certify that the following is a
true statement:



         FIFTH THIRD BANK, INDIANA, INDIANAPOLIS, MARION COUNTY, INDIANA IS A
         STATE CHARTERED COMMERCIAL BANK AND IS DULY AUTHORIZED TO DO BUSINESS
         IN THE STATE OF INDIANA.

as the same appears on file, as the law directs, in the office.



                                    IN WITNESS WHEREOF, I have hereunto set my
                                    hand and affixed the seal of the DEPARTMENT
                                    OF FINANCIAL INSTITUTIONS, of the State of
                                    Indiana, at the City of Indianapolis, this
                                    10th day of July, 2001     .
                                    DEPARTMENT OF FINANCIAL INSTITUTIONS
                                    By:   /s/ Charles W. Phillips
                                         -----------------------
                                                DIRECTOR
<PAGE>
                                    EXHIBIT 4

                  A COPY OF THE EXISTING BYLAWS OF THE TRUSTEE
                        INCORPORATING AMENDMENTS TO DATE

                                 [See Attached]
<PAGE>
                       BYLAWS OF FIFTH THIRD BANK, INDIANA

                                   ARTICLES I
                                  SHAREHOLDERS

         SECTION 1. MEETINGS. The annual meeting of the Shareholders shall be
held at the principal office of the Corporation at such hour, as may be fixed in
the notice of such meeting, and on such date, not earlier than the second
Thursday of January or later than the third Thursday of April of each year, as
shall be fixed by the Board of Directors and communicated in writing to the
Shareholders not later than twenty (20) days prior to such meeting.

         SECTION 2. QUORUM. Shareholders, whether in person or by lawful
proxies, representing a majority in amount of the outstanding stock of the
Corporation, shall constitute a quorum at any Shareholders' meeting. If there be
less than a majority in amount of such stock at any meeting, the meeting may be
adjourned from time to time.

                                   ARTICLE II
                               BOARD OF DIRECTORS

         SECTION 1. ELECTION AND NUMBER. The Board of Directors shall be elected
by the Shareholders. The Board of Directors shall be composed of twelve (12)
persons unless this number is changes by the vote of a majority of the Directors
in office. The Directors may increase the number to not more than twenty four
(24) persons and may decrease the number to not less than three (3) persons. Any
Director's office created by the Directors by reason of an increase in their
number may be filled by action of the majority of the Directors in Office.

         SECTION 2. TERM. Directors shall hold office until the expiration of
the term for which they were elected, and shall continue in office until their
respective successors shall have been duly elected and qualified. Any such term
of office shall be no longer than three (3) years.

         SECTION 3. QUALIFICATIONS AND COMPENSATION. No person shall serve as a
Director who does not meet the qualification requirements of the applicable laws
of Indiana. Each Director shall be entitled to receive such compensation for
attendance at meetings of the Board of Directors or Committees thereof as the
Board of Directors may, from time to time, fix.

         SECTION 4. REPLACEMENT OR REMOVAL. Directors may be replaced or removed
as provided by the laws of Indiana, provided that Directors may be removed
without cause only by an affirmative vote of not less than two-thirds (2/3) of
the outstanding shares of the Corporation.

         SECTION 5. VACANCIES. Any vacancy occurring in the Board of Directors
may be filed by the Board of Directors until an election to fill such vacancy is
had.

         SECTION 6. QUORUM. A majority of the whole authorized number of
Directors, as the same shall be established from time to time in accordance with
Section 1 of these Bylaws, shall constitute
<PAGE>
a quorum for a meeting of the Directors, except that a majority of the Directors
in office constitute a quorum for the filling of a vacancy or vacancies of the
Board.

         SECTION 7. MEETINGS OF THE BOARD. Regular meetings of the Board of
Directors shall be held on the third Thursday of each month, or at such other
times as may be determined by the Board of Directors. Except as otherwise
provided by the laws of Indiana, any business may be transacted at any regular
meeting of the Board of Directors. Special meetings shall be held upon the call
of the Chairman of the Board, if one be elected, or by the President, or in
their absence, by a Vice President or any three (3) Directors.

         SECTION 8. NOTICE OF MEETINGS. The Secretary shall give notice of each
meeting of the Board of Directors, whether regular or special, to each member of
the Board.

         SECTION 9. COMMITTEES.

         9.1 EXECUTIVE COMMITTEE. The Board of Directors shall appoint an
Executive Committee consisting of at least one (1) member of the Board of
Directors. Such executive Committee members shall serve until their successors
are appointed. A majority of the members of said Committee shall constitute a
quorum. The Executive Committee shall conduct the business of the Corporation
and shall have all the powers of the Board of Directors when said Board is not
in session, except that of declaring a dividend and as otherwise prescribed by
Indiana law. The Secretary of the Corporation shall keep a record of the
Committee's proceedings, which, signed by the Chairman of the Committee, shall
be presented at the meetings of the Committees and at the meetings of the Board
of Directors.

         9.2 OTHER COMMITTEES. The Chairman of the Board, Chief Executive
Officer or President, may appoint such additional Committees, by and with
approval of the Board of Directors, as may be deemed desirable or necessary.

         Each such Committee, so appointed, shall have such powers and perform
such duties, not inconsistent with the applicable laws of Indiana, as may be
delegated to it by the Board of Directors.

         SECTION 10. INDEMNIFICATION. The Corporation shall indemnify each
Director and each Officer of the Corporation, and each person employed by the
Corporation who serves at the written request of the President of the
Corporation as a director, trustee, officer, employee, or agent of another
corporation, domestic or foreign, non-profit or for profit, partnership, joint
venture, trust or other enterprise, to the full extent permitted by the
applicable laws of Indiana. The term "Officer" as used in this Section shall
include the Chairman of the Board and the Vice Chairman of the Board if such
offices are filled, the Chief Executive Officer, the President, each Vice
President, each Affiliate Director, the Treasurer, the Secretary, the Cashier,
the Controller, the Auditor, the Counsel and any other person who is
specifically designated as an "Officer" within the operation of this Section by
action of the Board of Directors. The Corporation may indemnify assistant
Officers, employees and others by action of the Board of Directors to the extent
permitted by the applicable laws of Indiana.
<PAGE>
                                   ARTICLE III
                                    OFFICERS

         SECTION 1. ELECTION OF OFFICERS. The Board of Directors at the first
meeting after the election of Directors may elect one of its own number Chairman
of the Board and one of its own number Vice Chairman of the Board, and it shall
elect one of its own number President. It may also elect a Chief Executive
Officer, one or more Vice Presidents (one or more of whom may be designated
Executive Vice President and/or Senior Vice President and/or Vice President and
Trust Officer), one or more Affiliate Directors, a Cashier, a Secretary, and a
Treasurer, and it may appoint such other officers as the Board may deem
advisable. The Corporation may also elect a Chief Executive Officer, President,
Chief Financial Officer, Secretary and/or Treasurer for each affiliate of the
Corporation as determined appropriate from time to time by the Board of
Directors, which such officers having the name of such affiliate appended to his
or her title (e.g., President (Southern)). Any two or more offices may be held
by the same person except that the duties of the President and the Secretary may
not be performed by the same person. Officers so elected shall hold office
during the term of the Board by whom they are elected, subject to the power of
the Board to remove them at its discretion. They shall be bonded in such amount
and with such surety or securities as the Board of Directors shall require.

         SECTION 2. POWERS AND DUTIES. The Chairman of the Board of Directors,
if the office be filled, otherwise the Vice Chairman of the Board of Directors,
if the office be filled, otherwise the President shall preside at all meetings
of the Shareholders and the Board of Directors, shall be responsible for the
supervision and control over the business of the Corporation and shall serve at
the pleasure of the Board of Directors. In the absence of disability of any of
the foregoing officers, their respective duties shall be performed by the
Chairman of the Board, Vice Chairman of the Board, the President, or by a Vice
President specifically designated by the Board of Directors, in the order named.

         The Secretary, or in his absence or disability, the assistant
Secretary, shall act, ex officio, as Secretary of all meetings of the
Shareholders, the Board of Directors and the Executive Committee. The other
officers of the Corporation shall have such powers and duties as usually and
customarily attached to their offices.

                                   ARTICLE IV
                          AFFILIATE BOARDS OF DIRECTORS

         SECTION 1. AFFILIATE BOARDS OF DIRECTORS. The Board of Directors may
elect such of its members and Officers of the Corporation (whether or not such
other persons are employed by the Corporation) in such numbers as the Board of
Directors deems necessary to form an affiliate board of directors for such
affiliates of the Corporation as determined appropriate form time to time by the
Board of Directors. As of May 29, 2001, such affiliates are anticipated to be
known as: Fifth Third Bank, Indiana (Southern). Any person designated as an
Affiliate Director, who is not employed by the Corporation, shall be a
Non-Employee Officer of the Corporation. Affiliate Directors so elected shall
hold office during the term of the Board by whom they are appointed, subject to
the power of the Board to remove them at its discretion and/or until such time
as their successors have been duly elected and qualified.
<PAGE>
         SECTION 2. POWERS AND DUTIES. The Board of Directors may delegate to
each Affiliate Board of Directors the power and authority to take by majority
vote of the members of such Affiliate Board of Directors any and all such
actions that may be legally delegated by the Board of Directors to any one or
more officers of the Corporation pursuant to the laws of Indiana. Any action
taken by any Affiliate Director pursuant to the direction given or authorization
granted to him or her by such Affiliate Board of Directors shall constitute the
valid and legal act of the Corporation pursuant to the approval and
authorization of the Board of Directors.

         SECTION 3. EXECUTIVE COMMITTEES. Each Affiliate Board of Directors
shall appoint an Executive Committee consisting of at least one(1) member of the
respective Affiliate Board of Directors. Such executive Committee shall serve
until their successors are appointed. The Board of Directors may delegate to
each such Executive Committee of an Affiliate Board of Directors any and all
such actions that may be legally delegated to the respective Affiliate Board of
Directors pursuant tot he laws of Indiana. Any action taken by any officer of
the Corporation pursuant to the direction given or authorization granted to him
or her by such Executive Committee shall constitute the valid and legal act of
the Corporation pursuant to the approval and authorization of the Board of
Directors.

                                    ARTICLE V
                              CERTIFICATES OF STOCK

         SECTION 1. FORM. Certificates for shares of stock shall be signed by
the Chairman of the Board, or by the President, or by one of the Vice
Presidents, and by the Secretary or Treasurer or by the Cashier or an Assistant
Cashier, shall contain such statements as are required by applicable Indiana
Law, and shall otherwise be in such form as the Board of Directors may, from
time to time, require.

         SECTION 2. TRANSFERS. Shares shall be transferable on the books of the
Corporation by the holders thereof in person or by duly authorized attorney upon
surrender of the certificates therefor with duly executed assignment endorsed
thereon or attached thereto.

         SECTION 3. CLOSING OF TRANSFER BOOKS. The books for the transfer of the
stock of the Corporation shall be closed for at least five (5) days preceding
the annual meeting of Shareholders, and may be closed by order of the Board of
Directors, or Executive Committee, for a like period before any other meeting of
the Shareholders.

                                   ARTICLE VI
                                   AMENDMENTS

         These bylaws may be changed, and new bylaws adopted by the vote of a
majority of the Board of Directors.
<PAGE>
                                    EXHIBIT 5


                 A COPY OF EACH INDENTURE REFERRED TO IN ITEM 4

                                (NOT APPLICABLE)
<PAGE>
                              EXHIBIT 6 TO FORM T-1

                             THE CONSENT OF TRUSTEE

         Pursuant to the requirements of Section 321(b) of the Trust Indenture
Act of 1939 in connection with the proposed issuance of 4% Convertible
Subordinated Notes Due 2012 of STEEL DYNAMICS, INC., Fifth Third Bank, Indiana
hereby consents that reports of examination by Federal, State, Territorial or
District Authorities may be furnished by such authorities to the Securities and
Exchange Commission upon request therefor.

                                                  FIFTH THIRD BANK, INDIANA


                                                  By:
                                                     ---------------------------

                                                  Its:
                                                      --------------------------
<PAGE>
                                    EXHIBIT 7

             A COPY OF THE LATEST REPORT OF CONDITION OF THE TRUSTEE
                  PUBLISHED PURSUANT TO LAW OR THE REQUIREMENTS
                    OF ITS SUPERVISING OR EXAMINING AUTHORITY

                                 [See Attached]
<PAGE>
<TABLE>
<S>                                            <C>
Fifth Third Bank, Indiana
251 NORTH ILLINOIS STREET                                   FFIEC 041
INDIANAPOLIS , IN  46204                        Consolidated Report of Condition
FDIC Certificate Number:  34434                       for December 31, 2002
</TABLE>



Consolidated Report of Condition for Insured Commercial and State - Chartered
Savings Banks for December 31, 2002

All Schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding as of the last business day of the
quarter.

Schedule RC -- Balance Sheet
<TABLE>
<CAPTION>
                                                     Dollar Amounts in Thousands
ASSETS
<S>                                                                                             <C>        <C>
   1. Cash and balances due from depository institutions (from Schedule RC-A)
      a. Noninterest-bearing balances and currency and coin(1)                                  RCON 0081    217,487
      b. Interest-bearing balances(2)                                                           RCON 0071        955
   2. Securities:
      a. Held-to-maturity securities (from Schedule RC-B, column A)                             RCON 1754      4,975
      b. Available-for-sale securities (from Schedule RC-B, column D)                           RCON 1773  2,824,862
   3. Federal funds sold and securities purchased under agreements to resell
      a. FEDERAL FUNDS SOLD                                                                     RCON B987  1,026,333
      b. SECURITIES PURCHASED UNDER AGREEMENTS TO RESELL(3)                                     RCFD B989          0
   4. Loans and lease financing receivables (from Schedule RC-C):
      a. Loans and leases held for sale                                                         RCON 5369        370
      b. Loans and leases, net of unearned income                                               RCON B528  3,913,525
      c. LESS: Allowance for loan and lease losses                                              RCON 3123     57,730
      d. Loans and leases, net of unearned income and allowance (item 4.b minus 4.c)            RCON B529  3,855,795
   5. Trading assets (from Schedule RC-D)                                                       RCON 3545          0
   6. Premises and fixed assets (including capitalized leases)                                  RCON 2145     84,986
   7. Other real estate owned (from Schedule RC-M)                                              RCON 2150      2,377
   8. Investments in unconsolidated subsidiaries and associated companies                       RCON 2130          0
</TABLE>
<PAGE>
<TABLE>
<S>                                                                                             <C>        <C>
      (from Schedule RC-M)
   9. Customers' liability to this bank on acceptances outstanding                              RCON 2155          0
  10. Intangible assets:
      a. Goodwill                                                                               RCON 3163     21,150
      b. Other intangible assets (from Schedule RC-M)                                           RCON 0426          8
  11. Other assets (from Schedule RC-F)                                                         RCON 2160    296,230
  12. Total assets (sum of items 1 through 11)                                                  RCON 2170  8,335,528
LIABILITIES

13. Deposits:
      a. In domestic offices (sum of totals of columns A and C from Schedule RC-E)              RCON 2200  4,612,468
         (1) Noninterest-bearing(4)                                                             RCON 6631    315,744
         (2) Interest-bearing                                                                   RCON 6636  4,296,723
      b. Not applicable

  14. Federal funds purchased and securities sold under agreements to repurchase
      a. Federal funds purchased(5)                                                             RCON B993    224,270
      b. Securities sold under agreements to repurchase(6)                                      RCON B995    539,344
  15. Trading liabilities (from Schedule RC-D)                                                  RCON 3548          0
  16. Other borrowed money (includes mortgage indebtedness and
      obligations under capitalized leases) (from Schedule RC-M)                                RCON 3190  1,774,673
  17. Not applicable
  18. Bank's liability on acceptances executed and outstanding                                  RCON 2920          0
  19. Subordinated notes and debentures(7)                                                      RCON 3200          0
  20. Other liabilities (from Schedule RC-G)                                                    RCON 2930    106,747
  21. Total liabilities (sum of items 13 through 20)                                            RCON 2948  7,257,502
  22. Minority interest in consolidated subsidiaries                                            RCON 3000          0
EQUITY CAPITAL

  23. Perpetual preferred stock and related surplus                                             RCON 3838          0
  24. Common stock                                                                              RCON 3230      4,000
  25. Surplus (exclude all surplus related to preferred stock)                                  RCON 3839    613,906
  26.   a. Retained earnings                                                                    RCON 3632    400,245
      b. Accumulated other comprehensive income(8)                                              RCON B530     59,875
  27. Other equity capital components(9)                                                        RCON A130          0
  28. Total equity capital (sum of items 23 through 27)                                         RCON 3210  1,078,026
  29. Total liabilities, minority interest, and equity capital
      (sum of items 21, 22, and 28)                                                             RCON 3300  8,335,528
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

Memorandum
TO BE REPORTED WITH THE MARCH REPORT OF CONDITION.
<S>                                                                                             <C>        <C>
  1. Indicate in the box at the right the number of the statement below that best describes                NUMBER
     the most comprehensive level of auditing work performed for the bank by independent
     external auditors as of any date during 2001                                               RCFD 6724     N/A

</TABLE>

<TABLE>

<S>                                                         <C>
   1 = Independent audit of the bank conducted in           4 = Directors' examination of the bank conducted in
       accordance with generally accepted auditing              accordance with generally accepted auditing
       standards by a certified public accounting firm          standards by a certified public accounting firm
       which submits a report on the bank                       (may be required by state chartering authority)

   2 = Independent audit of the bank's parent holding       5 = Directors' examination of the bank performed by
       company conducted in accordance with generally           other external auditors (may be required by state
       accepted auditing standards by a certified public        chartering authority)
       accounting firm which submits a report on the
       consolidated holding company (but not on the bank
       separately)
                                                            6 = Review of the bank's financial statements by
                                                                external auditors

                                                            7 = Compilation of the bank's financial statements by
                                                                external auditors

   3 = Attestation on bank management's assertion on the    8 = Other audit procedures (excluding tax preparation
       effectiveness of the bank's internal control over        work)
       financial reporting by a certified public
       accounting firm
                                                            9 = No external audit work
</TABLE>

---------------------------
(1) Includes cash items in process of collection and unposted debits.

(2) Includes time certificates of deposit not held for trading.

(3) Includes all securities resale agreements, regardless of maturity.

(4) Includes total demand deposits and noninterest-bearing time and savings
    deposits.

(5) Report overnight Federal Home Loan Bank advantages in Schedule RC, item 16,"
    other borrowed money."

(6) Includes all securities repurchase agreements, regardless of maturity.

(7) Includes limited-life preferred stock and related surplus.

<PAGE>

(8) Includes net unrealized holding gains (losses) on available-for-sale
    securities, accumulated net gains (losses) on cash flow hedges, cumulative
    foreign currency translation adjustments, and minimum pension liability
    adjustments.

(9) Includes treasury stock and unearned Employee Stock Ownership Plan shares.

<PAGE>
                                    EXHIBIT 8

A COPY OF ANY ORDER PURSUANT TO WHICH THE FOREIGN TRUSTEE IS AUTHORIZED TO ACT
AS SOLE TRUSTEE UNDER INDENTURES QUALIFIED OR TO BE QUALIFIED UNDER THE ACT


                                (NOT APPLICABLE)
<PAGE>
                                    EXHIBIT 9

          FOREIGN TRUSTEES ARE REQUIRED TO FILE A CONSENT TO SERVICE OF
                               PROCESS OF FORM F-X

                                (NOT APPLICABLE)

</TEXT>
</DOCUMENT>
</SUBMISSION>
