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EXHIBIT 10.35
December 16, 1999
VIA FACSIMILE - 000-000-0000
Xxxxxxx X. Xxxxxxx
Director Raw Materials
USX Corporation
000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
Re: Geneva Steel Company ("Geneva"); Taconite Pellet Supply
Dear Xx. Xxxxxxx:
As you know, December 31, 1999 is the stated expiration date of that
certain Taconite Pellet Sales Agreement effective September 1, 1994, as amended
July 25, 1997, and September 30, 1998 (the "Agreement"). This will confirm our
understanding that pursuant to this letter agreement, to be effective January 1,
2000 through March 31, 0000 (xxx "xxxxx xxxxxxx 0000"), and thereafter as
provided below, USX Corporation will continue to sell and Geneva will continue
to purchase fluxed taconite ("Fluxtac") pellets on the same terms and conditions
as are set forth in the Agreement in the event that a new supply agreement is
not completed prior to the expiration of the Agreement.
Geneva declares its Fluxtac pellet requirement for the first quarter
2000 will be between 700,000 and 750,000 net tons, which shall constitute the
respective purchase and sale obligation of the parties. Deliveries shall be
scheduled at as uniform a rate as practicable throughout the quarter. The
purchase price per net ton of Fluxtac pellets will be $0.4542 per natural net
ton iron unit (approximately $28.24 per net ton), FOB Minntac price as provided
in the Agreement for the last quarter of calendar year 1999.
This letter agreement shall remain in effect as herein provided while
the parties attempt to negotiate in good faith a new supply agreement to supply
all of Geneva's requirements for Fluxtac pellets and shall not constitute an
amendment or extension of the Agreement, reference to which is made solely for
the purpose of defining the terms and conditions of this letter agreement. The
new supply agreement may provide for superseding this letter agreement in any
manner as may be agreed upon by the parties.
Effective April 1, 2000, this letter agreement will automatically be
extended and shall remain in effect unless or until either party serves upon the
other written notice of
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December 16, 1999
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termination no less than forty five (45) days prior to the effective termination
date specified in such notice. The respective purchase and sale obligations of
the parties during such an extension of this letter agreement shall be a pro
rata portion of the quantity range specified in the second paragraph above, and
all other terms of this of this letter agreement, including the price specified
above, shall remain in effect.
The parties acknowledge that Geneva is a debtor and
debtor-in-possession in a Chapter 11 bankruptcy proceeding in the United States
Bankruptcy Court of the District of Utah (the "Bankruptcy Court"). The fact that
Geneva is involved in such proceeding shall not excuse either USX Corporation or
Geneva from performing pursuant to the provisions of this letter agreement and
applicable provisions of bankruptcy law.
Geneva acknowledges and agrees that the current trade credit terms and
conditions as presently established and governing pellet shipments shall
continue to apply to this letter agreement. USX Corporation reserves the right
to withhold shipments of pellets and/or to revise said credit terms and
conditions without being in default of this letter agreement in the event Geneva
fails to comply with such credit terms and conditions.
Nothing set forth in this letter agreement is or is intended to be an
assumption of the Agreement, such assumption to be effected, if at all, through
applicable proceedings in the Bankruptcy Court.
GENEVA STEEL COMPANY,
Debtor and Debtor-in-Possession
/s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx, Director Raw Materials
ACCEPTED AND AGREED TO
this 20th day of December, 1999.
USX CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
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December 16, 1999
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Xxxxxxx X. Xxxxxxx
Its: Director, Raw Materials Planning,
Procurement, Distribution & Sales
