Item 1.01. Entry into a Material Definitive Agreement.

Merger Agreement

On October 18, 2005, Steel Dynamics, Inc. (“SDI”), an Indiana corporation, entered into a merger agreement (the “Merger Agreement”) with RS Acquisition Corporation (“Merger Subsidiary”), an Indiana corporation and a direct wholly owned subsidiary of SDI, and Roanoke Electric Steel Corporation (“Roanoke”), a Virginia corporation. The Merger Agreement provides that, upon the terms and subject to the conditions set forth in the Merger Agreement. Roanoke will merge with and into Merger Subsidiary, with Merger Subsidiary continuing as the surviving corporation and a direct wholly-owned subsidiary of SDI (the “Merger”).

At the effective time and as a result of the Merger, in exchange for their shares of issued and outstanding Roanoke common stock, Roanoke stockholders will receive for each Roanoke common share (i) 0.400 shares of SDI common stock and (ii) $9.75 in cash. The aggregate amount of the cash payment to Roanoke stockholders will equal approximately $108.7 million, based on the 11,145,813 shares issued and outstanding at the close of business on September 30, 2005. The closing prices of SDI and Roanoke shares on NASDAQ on October 17, 2005, were $28.77 and $18.69, respectively.

All outstanding Roanoke stock options (whether vested or unvested) will be assumed by SDI. Each such option previously exercisable for Roanoke common shares will then become exercisable for an adjusted number of SDI common shares at an adjusted exercise price, based on an exchange ratio of 0.7389 SDI shares for each Roanoke share.

Following the effective time of the Merger, Keith Busse, President and Chief Executive Officer of SDI, will continue as President and CEO of the combined companies. Donald G. Smith, Chairman and Chief Executive Officer of Roanoke, will retire.

SDI and Roanoke have made customary representations, warranties and covenants in the Merger Agreement. The completion of the Merger is subject to approval by the stockholders of Roanoke, regulatory approvals, including antitrust approval, and the satisfaction or waiver of other customary conditions.

The Merger Agreement contains certain termination rights for both SDI and Roanoke, and further provides that, upon termination of the Merger Agreement under specified circumstances, SDI may be entitled to receive a termination fee of $7.5 million, plus certain expenses.

The foregoing description of the Merger and the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the complete text of the Merger Agreement, which is attached as Exhibit 2.1 hereto and incorporated herein by reference. The Merger Agreement has been included to provide investors and stockholders with information regarding its terms. It is not intended to provide any other factual information about SDI. The Merger Agreement contains representations and warranties that the parties to the Merger Agreement made to and solely for the benefit of each other, and the assertions embodied in such representations and warranties are qualified by information contained in confidential disclosure schedules that the parties exchanged in connection with signing the Merger Agreement. Accordingly, investors and stockholders should not rely on such representations and warranties as characterizations of the actual state of facts or circumstances, since they were only made as of the date of their Merger Agreement and are modified in important part by the underlying disclosure schedules. Moreover, information concerning the subject matter of such representations and warranties may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in SDI’s public disclosures.

Additional Information and Where to Find It

SDI intends to file a registration statement on Form S-4, and SDI and Roanoke intend to file a related proxy statement/prospectus, in connection with the merger transaction involving SDI and Roanoke. Investors and security holders are urged to read the registration statement on Form S-4 and the related proxy statement/prospectus when they become available because they will contain important information about the merger transaction. Investors and security holders may obtain free copies of these documents (when they are available) and other documents filed with the SEC at the SEC's web site at www.sec.gov. In addition, investors and security holders may obtain free copies of the documents filed with the SEC by SDI by contacting SDI Investor Relations at (260) 459-3553. Investors and security holders may obtain free copies of the documents filed with the SEC by Roanoke by contacting Roanoke Investor Relations at (540) 342-1831.