APPENDICES
VALMONT 1996 STOCK PLAN
SECTION 1
NAME AND PURPOSE
1.1 Name. The name of the plan shall be the Valmont 1996
Stock Plan (the "Plan").
1.2. Purpose of Plan. The purpose of the Plan is to foster
and promote the long-term financial success of the Company and
increase stockholder value by (a) motivating superior performance
by means of stock incentives, (b) encouraging and providing for
the acquisition of an ownership interest in the Company by
Employees and (c) enabling the Company to attract and retain the
services of a management team responsible for the long-term
financial success of the Company.
SECTION 2
DEFINITIONS
2.1 Definitions. Whenever used herein, the following terms
shall have the respective meanings set forth below:
(a) "Act" means the Securities Exchange Act of 1934, as
amended.
(b) "Award" means any Option, Stock Appreciation Right,
Restricted Stock, Stock Bonus, or any combination
thereof, including Awards combining two or more types
of Awards in a single grant.
(c) "Board" means the Board of Directors of the Company.
(d) "Code" means the Internal Revenue Code of 1986, as
amended.
(e) "Committee" means the Compensation Committee of the
Board, which shall consist of two or more members, each
of whom shall be "disinterested persons" within the
meaning of Rule 16b-3 as promulgated under the Act.
(f) "Company" means Valmont Industries, Inc., a Delaware
corporation (and any successor thereto) and its
Subsidiaries.
(g) "Director Award" means an award of Stock and an annual
Award of a Nonstatutory Stock Option granted to each
Eligible Director pursuant to Section 7.1 without any
action by the Board or the Committee.
(h) "Eligible Director" means a person who is serving as a
member of the Board and who is not an Employee.
(i) "Employee" means any employee of the Company or any of
its Subsidiaries.
(j) "Fair Market Value" means, on any date, the average of
the high and low sales prices of the Stock as reported
on the National Association of Securities Dealers
Automated Quotation system (or on such other recognized
market or quotation system on which the trading prices
of the Stock are traded or quoted at the relevant time)
on such date. In the event that there are no Stock
transactions reported on such system (or such other
system) on such date, Fair Market Value shall mean the
average of the high and low sale prices on the
immediately preceding date on which Stock transactions
were so reported.
(k) "Option" means the right to purchase Stock at a stated
price for a specified period of time. For purposes of
the Plan, an Option may be either (i) an Incentive
Stock Option within the meaning of Section 422 of the
Code or (ii) a Nonstatutory Stock Option.
(l) "Participant" means any Employee designated by the
Committee to participate in the Plan.
(m) "Plan" means the Valmont 1996 Stock Plan, as in effect
from time to time.
(n) "Restricted Stock" shall mean a share of Stock granted
to a Participant subject to such restrictions as the
Committee may determine.
(o) "Stock" means the Common Stock of the Company, par
value $1.00 per share.
(p) "Stock Appreciation Right" means the right, subject to
such terms and conditions as the Committee may
determine, to receive an amount in cash or Stock, as
determined by the Committee, equal to the excess of (i)
the Fair Market Value, as of the date such Stock
Appreciation Right is exercised, of the number shares
of Stock covered by the Stock Appreciation Right being
exercised over (ii) the aggregate exercise price of
such Stock Appreciation Right.
(q) "Stock Bonus" means the grant of Stock as compensation
from the Company, which may be in lieu of cash salary
or bonuses otherwise payable to the Participant or in
addition to such cash compensation.
(r) "Subsidiary" means any corporation or partnership in
which the Company owns, directly or indirectly, 50% or
more of the total combined voting power of all classes
of stock of such corporation or of the capital interest
or profits interest of such partnership.
2.2 Gender and Number. Except when otherwise indicated by
the context, words in the masculine gender used in the Plan shall
include the feminine gender, the singular shall include the
plural, and the plural shall include the singular.
SECTION 3
ELIGIBILITY AND PARTICIPATION
Except as otherwise provided in Section 7.1, the only
persons eligible to participate in the Plan shall be those
Employees selected by the Committee as Participants.
SECTION 4
POWERS OF THE COMMITTEE
4.1 Power to Grant. The Committee shall determine the
Participants to whom Awards shall be granted, the type or types
of Awards to be granted, and the terms and conditions of any and
all such Awards. The Committee may establish different terms and
conditions for different types of Awards, for different
Participants receiving the same type of Awards, and for the same
Participant for each Award such Participant may receive, whether
or not granted at different times.
4.2 Administration. The Committee shall be responsible for
the administration of the Plan. The Committee, by majority action
thereof, is authorized to prescribe, amend, and rescind rules and
regulations relating to the Plan, to provide for conditions
deemed necessary or advisable to protect the interests of the
Company, and to make all other determinations necessary or
advisable for the administration and interpretation of the Plan
in order to carry out its provisions and purposes.
Determinations, interpretations, or other actions made or taken
by the Committee pursuant to the provisions of the Plan shall be
final, binding, and conclusive for all purposes and upon all
persons. Notwithstanding anything else contained in the Plan to
the contrary, neither the Committee nor the Board shall have any
discretion regarding whether an Eligible Director receives a
Director Award pursuant to Section 7.1 or regarding the terms of
any such Director Award, including, without limitation, the
number of shares subject to any such Director Award.
SECTION 5
STOCK SUBJECT TO PLAN
5.1 Number. Subject to the provisions of Section 5.3, the
number of shares of Stock subject to Awards (including Director
Awards) under the Plan may not exceed 800,000 shares of Stock.
The shares to be delivered under the Plan may consist, in whole
or in part, of treasury Stock or authorized but unissued Stock,
not reserved for any other purpose. The maximum number of shares
of Stock with respect to which Awards may be granted to any one
Employee under the Plan is 40% of the aggregate number of shares
of Stock available for Awards under Section 5.1.
5.2 Cancelled, Terminated or Forfeited Awards. Any shares
of Stock subject to an Award which for any reason are cancelled,
terminated or otherwise settled without the issuance of any Stock
shall again be available for Awards under the Plan.
5.3 Adjustment in Capitalization. In the event of any Stock
dividend or Stock split, recapitalization (including, without
limitation, the payment of an extraordinary dividend), merger,
consolidation, combination, spin-off, distribution of assets to
stockholders, exchange of shares, or other similar corporate
change, (i) the aggregate number of shares of Stock available for
Awards under Section 5.1 and (ii) the number of shares and
exercise price with respect to Options and the number, prices and
dollar value of other Awards, may be appropriately adjusted by
the Committee, whose determination shall be conclusive. If,
pursuant to the preceding sentence, an adjustment is made to the
number of shares of Stock authorized for issuance under the Plan,
a corresponding adjustment shall be made with respect to Director
Awards granted pursuant to Section 7.1.
SECTION 6
STOCK OPTIONS
6.1 Grant of Options. Options may be granted to
Participants at such time or times as shall be determined by the
Committee. Options granted under the Plan may be of two types:
(i) Incentive Stock Options and (ii) Nonstatutory Stock Options.
The Committee shall have complete discretion in determining the
number of Options, if any, to be granted to a Participant. Each
Option shall be evidenced by an Option agreement that shall
specify the type of Option granted, the exercise price, the
duration of the Option, the number of shares of Stock to which
the Option pertains, the exercisability (if any) of the Option in
the event of death, retirement, disability or termination of
employment, and such other terms and conditions not inconsistent
with the Plan as the Committee shall determine.
6.2 Option Price. Nonstatutory Stock Options and Incentive
Stock Options granted pursuant to the Plan shall have an exercise
price which is not less than the Fair Market Value on the date
the Option is granted.
6.3 Exercise of Options. Options awarded to a Participant
under the Plan shall be exercisable at such times and shall be
subject to such restrictions and conditions as the Committee may
impose, subject to the Committee's right to accelerate the
exercisability of such Option in its discretion. Notwithstanding
the foregoing, no Option shall be exercisable for more than ten
years after the date on which it is granted.
6.4 Payment. The Committee shall establish procedures
governing the exercise of Options, which shall require that
written notice of exercise be given and that the Option price be
paid in full in cash or cash equivalents, including by personal
check, at the time of exercise or pursuant to any arrangement
that the Committee shall approve. The Committee may, in its
discretion, permit a Participant to make payment (i) in Stock
already owned by the Participant valued at its Fair Market Value
on the date of exercise (if such Stock has been owned by the
Participant for at least six months) or (ii) by electing to have
the Company retain Stock which would otherwise be issued on
exercise of the Option, valued at its Fair Market Value on the
date of exercise. As soon as practicable after receipt of a
written exercise notice and full payment of the exercise price,
the Company shall deliver to the Participant a certificate or
certificates representing the acquired shares of Stock.
6.5 Incentive Stock Options. Notwithstanding anything in
the Plan to the contrary, no term of this Plan relating to
Incentive Stock Options shall be interpreted, amended or altered,
nor shall any discretion or authority granted under the Plan be
so exercised, so as to disqualify the Plan under Section 422 of
the Code, or, without the consent of any Participant affected
thereby, to cause any Incentive Stock Option previously granted
to fail to qualify for the Federal income tax treatment afforded
under Section 421 of the Code. In furtherance of the foregoing,
(i) the aggregate Fair Market Value of shares of Stock
(determined at the time of grant of each Option) with respect to
which Incentive Stock Options are exercisable for the first time
by an Employee during any calendar year shall not exceed $100,000
or such other amount as may be required by the Code, (ii) an
Incentive Stock Option may not be exercised more than three
months following termination of employment (except as the
Committee may otherwise determine in the event of death or
disability), and (iii) if the Employee receiving an Incentive
Stock Option owns Stock possessing more than 10% of the total
combined voting power of all classes of Stock of the Company, the
exercise price of the Option shall be at least 110% of Fair
Market Value and the Option shall not be exercisable after the
expiration of five years from the date of grant.
6.6 Replacement Options. The Committee may grant a
replacement option (a "Replacement Option") to any Employee who
exercises all or part of an option granted under this Plan using
Qualifying Stock (as herein defined) as payment for the purchase
price. A Replacement Option shall grant to the Employee the
right to purchase, at the Fair Market Value as of the date of
said exercise and grant, the number of shares of stock equal to
the sum of the number of whole shares (i) used by the Employee in
payment of the purchase price for the option which was exercised
and (ii) used by the Employee in connection with applicable
withholding taxes on such transaction. A Replacement Option may
not be exercised for six months following the date of grant, and
shall expire on the same date as the option which it replaces.
Qualifying Stock is stock which has been owned by the Employee
for at least six months prior to the date of exercise and has not
been used in a stock-for-stock swap transaction within the
preceding six months.
SECTION 7
DIRECTOR AWARDS
7.1 Amount of Award. Each Eligible Director shall receive
a non-discretionary Award of 1,000 shares of stock each year;
such Award shall be made annually on the date of and following
completion of the Company's annual stockholders' meeting
(commencing with the 1996 annual stockholders' meeting). Each
Eligible Director shall be issued a common stock certificate for
such number of shares. Termination of the director's services
for any reason other than (i) death, (ii) retirement from the
Board at mandatory retirement age, or (iii) resignation or
failure to stand for re-election, in any such case with the
prior approval of the Board, will result in forfeiture of the
Stock. If the Stock is forfeited, the director shall return the
number of forfeited shares of Stock, or equivalent value, to the
Company. The number of shares of Stock awarded to an Eligible
Director annually shall be appropriately adjusted in the event
of any stock changes as described in Section 5.3. In addition,
each Eligible Director shall receive a non-discretionary Award
of a Nonqualified Stock Option for 2,000 shares of Stock
exercisable at the Fair Market Value of the Company's common
stock on the date of grant; such Award shall be made annually on
the date of and following completion of the Company's annual
stockholders' meeting (commencing with the 1996 annual
stockholders' meeting). The number of nonqualified options
awarded to a director shall be appropriately adjusted in the
event of any stock changes as described in Section 5.3.
7.2 No Other Awards. An Eligible Director shall not
receive any other Award under the Plan.
SECTION 8
STOCK APPRECIATION RIGHTS
8.1 SAR's In Tandem with Options. Stock Appreciation
Rights may be granted to Participants in tandem with any Option
granted under the Plan, either at or after the time of the grant
of such Option, subject to such terms and conditions, not
inconsistent with the provisions of the Plan, as the Committee
shall determine. Each Stock Appreciation Right shall only be
exercisable to the extent that the corresponding Option is
exercisable, and shall terminate upon termination or exercise of
the corresponding Option. Upon the exercise of any Stock
Appreciation Right, the corresponding Option shall terminate.
8.2 Other Stock Appreciation Rights. Stock Appreciation
Rights may also be granted to Participants separately from any
Option, subject to such terms and conditions, not inconsistent
with the provisions of the Plan, as the Committee shall
determine.
SECTION 9
RESTRICTED STOCK
9.1 Grant of Restricted Stock. The Committee may grant
Restricted Stock to Participants at such times and in such
amounts, and subject to such other terms and conditions not
inconsistent with the Plan as it shall determine. Each grant of
Restricted Stock shall be subject to such restrictions, which
may relate to continued employment with the Company, performance
of the Company, or other restrictions, as the Committee may
determine. Each grant of Restricted Stock shall be evidenced by
a written agreement setting forth the terms of such Award.
9.2 Removal of Restrictions. The Committee may accelerate
or waive such restrictions in whole or in part at any time in
its discretion.
SECTION 10
STOCK BONUSES
10.1 Grant of Stock Bonuses. The Committee may grant a
Stock Bonus to a Participant at such times and in such amounts,
and subject to such other terms and conditions not inconsistent
with the Plan, as it shall determine.
SECTION 11
AMENDMENT, MODIFICATION, AND TERMINATION OF PLAN
11.1 General. The Board may from time to time amend, modify
or terminate any or all of the provisions of the Plan, subject
to the provisions of this Section 11.1. The Board may not
change the Plan in a manner which would prevent outstanding
Incentive Stock Options granted under the Plan from being
Incentive Stock Options without the consent of the optionees
concerned. Furthermore, the Board may not make any amendment
which would (i) materially modify the requirements for
participation in the Plan, (ii) increase the number of shares of
Stock subject to Awards under the Plan pursuant to Section 5.1,
(iii) materially increase the benefits accruing to Participants
under the Plan, or (iv) make any other amendments which would
cause the Plan not to comply with Rule 16b-3 under the Act, in
each case without the approval of the Company's stockholders.
No amendment or modification shall affect the rights of any
Employee with respect to a previously granted Award, nor shall
any amendment or modification affect the rights of any Eligible
Director pursuant to a previously granted Director Award.
11.2 Termination of Plan. No further Options shall be
granted under the Plan subsequent to December 31, 2005, or such
earlier date as may be determined by the Board.
SECTION 12
MISCELLANEOUS PROVISIONS
12.1 Nontransferability of Awards. No Awards granted under
the Plan may be sold, transferred, pledged, assigned, or
otherwise alienated or hypothecated, other than by will or by
the laws of descent and distribution. All rights with respect
to Awards granted to a Participant under the Plan shall be
exercisable during the Participant's lifetime only by such
Participant and all rights with respect to any Director Awards
granted to an Eligible Director shall be exercisable during the
Director's lifetime only by such Eligible Director.
12.2 Beneficiary Designation. Each Participant under the
Plan may from time to time name any beneficiary or beneficiaries
(who may be named contingent or successively) to whom any
benefit under the Plan is to be paid or by whom any right under
the Plan is to be exercised in case of his death. Each
designation will revoke all prior designations by the same
Participant shall be in a form prescribed by the Committee, and
will be effective only when filed in writing with the Company.
In the absence of any such designation, Awards outstanding at
death may be exercised by the Participant's surviving spouse, if
any, or otherwise by his estate.
12.3 No Guarantee of Employment or Participation. Nothing
in the Plan shall interfere with or limit in any way the right
of the Company or any Subsidiary to terminate any Participant's
employment at any time, nor confer upon any Participant any
right to continue in the employ of the Company or any
Subsidiary. No Employee shall have a right to be selected as a
Participant, or, having been so selected, to receive any future
Awards.
12.4 Tax Withholding. The Company shall have the power to
withhold, or require a Participant or Eligible Director to remit
to the Company, an amount sufficient to satisfy federal, state,
and local withholding tax requirements on any Award under the
Plan, and the Company may defer issuance of Stock until such
requirements are satisfied. The Committee may, in its
discretion, permit a Participant to elect, subject to such
conditions as the Committee shall impose, (i) to have shares of
Stock otherwise issuable under the Plan withheld by the Company
or (ii) to deliver to the Company previously acquired shares of
Stock, in each case having a Fair Market Value sufficient to
satisfy all or part of the Participant's estimated total
federal, state and local tax obligation associated with the
transaction.
12.5 Change of Control. On the date of a Change of Control,
all outstanding options and stock appreciation rights shall
become immediately exercisable and all restrictions with respect
to Restricted Stock shall lapse. "Change of Control" shall
mean:
(i) The acquisition (other than from the Company) by any
person, entity or "group", within the meaning of
Section 13(d)(3) or 14(d)(2) of the Act (excluding any
acquisition or holding by (i) the Company or its
subsidiaries, (ii) any employee benefit plan of the
Company or its subsidiaries which acquires beneficial
ownership of voting securities of the Company and (iii)
Robert B. Daugherty, his successors and assigns and any
tax-exempt entity established by him) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated
under the Act) of 50% or more of either the then
outstanding shares of common stock or the combined
voting power of the Company's then outstanding voting
securities entitled to vote generally in the election
of directors; or
(ii) Individuals who, as of the date hereof, constitute the
Board (as of the date hereof the "Incumbent Board")
cease for any reason to constitute at least a majority
of the Board, provided that any person becoming a
director subsequent to the date hereof whose election,
or nomination for the election by the Company's
stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent
Board shall be, for purposes of this Plan, considered
as though such person were a member of the Incumbent
Board; or
(iii) Approval by the stockholders of the Company of a
reorganization, merger or consolidation, in each case,
with respect to which persons who were the stockholders
of the Company immediately prior to such
reorganization, merger or consolidation do not,
immediately thereafter, own more than 50% of the
combined voting power entitled to vote generally in the
election of directors of the reorganized, merged or
consolidated company's then outstanding voting
securities, or a liquidation or dissolution of the
Company or of the sale of all or substantially all of
the assets of the Company.
12.6 Company Intent. The Company intends that the Plan
comply in all respects with Rule 16b-3 under the Act, and any
ambiguities or inconsistencies in the construction of the Plan
shall be interpreted to give effect to such intention.
12.7 Requirements of Law. The granting of Awards and the
issuance of shares of Stock shall be subject to all applicable
laws, rules, and regulations, and to such approvals by any
governmental agencies or securities exchanges as may be
required.
12.8 Effective Date. The Plan shall be effective upon its
adoption by the Board subject to approval by the Company's
stockholders at the 1996 annual stockholders' meeting.
12.9 Governing Law. The Plan, and all agreements hereunder,
shall be construed in accordance with and governed by the laws
of the State of Delaware.
VALMONT EXECUTIVE INCENTIVE PLAN
1. Purpose. The principal purpose of the Valmont
Industries, Inc. Executive Incentive Plan (the "Plan") is to
provide incentives to executive officers of Valmont ("Valmont")
who have significant responsibility for the success and growth
of Valmont and to assist Valmont in attracting, motivating and
retaining executive officers on a competitive basis.
2. Administration of the Plan. The Plan shall be
administered by the Compensation Committee of the Board of
Directors (the "Committee"). The Committee shall have the sole
discretion to interpret the Plan; approve a pre-established
objective performance measure or measures annually; certify the
level to which each performance measure was attained prior to
any payment under the Plan; approve the amount of awards made
under the Plan; and determine who shall receive any payment
under the Plan.
The Committee shall have full power and authority to
administer and interpret the Plan and to adopt such rules,
regulations and guidelines for the administration of the Plan
and for the conduct of its business as the Committee deems
necessary or advisable. The Committee's interpretations of the
Plan, and all actions taken and determinations made by the
Committee pursuant to the powers vested in it hereunder, shall
be conclusive and binding on all parties concerned, including
Valmont, its stockholders and any person receiving an award
under the Plan.
3. Eligibility. Executive officers and other key
management personnel of Valmont shall be eligible to receive
awards under the Plan. The Committee shall designate the
executive officers and other key management personnel who will
participate in the Plan each year.
4. Awards. The Committee shall establish annual and/or
long-term incentive award targets for participants. If an
individual becomes an executive officer during the year, such
individual may be granted eligibility for an incentive award for
that year upon such individual becoming an executive officer.
The Committee shall also establish annual and/or long-term
performance targets which must be achieved in order for an award
to be earned under the Plan. Such targets shall be based on
earnings, earnings per share, growth in earnings per share,
achievement of annual operating profit plans, return on equity
performance, or similar financial performance measures as may be
determined by the Committee. The specific performance targets
for each participant shall be established in writing by the
Committee within ninety days after the commencement of the
fiscal year (or within such other time period as may be required
by Section 162(m) of the Internal Revenue Code) to which the
performance target relates. The performance target shall be
established in such a manner than a third party having knowledge
of the relevant facts could determine whether the performance
goal has been met.
Awards shall be payable following the completion of the
applicable fiscal year upon certification by the Committee that
Valmont achieved the specified performance target established
for the participant. Notwithstanding the attainment by Valmont
of the specified performance targets, the Committee has the
discretion, for each participant, to reduce some or all of an
award that would otherwise be paid. However, in no event may a
participant receive an award of more than 400% of such
participant's base salary under the Plan in any fiscal year; for
this purpose, a participant's base salary shall be the base
salary in effect at the time the Committee establishes the
performance targets for a fiscal year or period.
5. Miscellaneous Provisions. Valmont shall have the right
to deduct from all awards hereunder paid in cash any federal,
state, local or foreign taxes required by law to be withheld
with respect to such awards. Neither the Plan nor any action
taken hereunder shall be construed as giving any employee any
right to be retained in the employ of Valmont. The costs and
expenses of administering the Plan shall be borne by Valmont and
shall not be charged to any award or to any participant
receiving an award.
6. Effective Date, Amendments and Termination. The Plan
shall become effective on December 19, 1995 subject to approval
by the stockholders of Valmont at the 1996 Annual Meeting of
Stockholders. The Committee may at any time terminate or from
time to time amend the Plan in whole or in part, but no such
action shall adversely affect any rights or obligations with
respect to any awards theretofore made under the Plan. However,
unless the stockholders of Valmont shall have first approved
thereof, no amendment of the Plan shall be effective which would
increase the maximum amount which can be paid to any one
executive officer under the Plan in any fiscal year, which would
change the specified performance goals for payment of awards, or
which would modify the requirement as to eligibility for
participation in the Plan.
FOURTH AMENDMENT TO THE VALMONT 1988 STOCK PLAN
The Valmont 1988 Stock Plan (as previously amended, the
"Plan") is hereby further amended as follows:
A. Section 3.3 is amended by adding the following
sentences immediately preceding the last sentence of Section
3.3:
In addition, each director who is not an Employee of the
Company shall receive a non-discretionary award of a
Nonqualified Stock Option for 2,000 shares of Company
Stock exercisable at the closing price of the Company's
common stock on the date of grant; such award shall be
made (i) on the third business day following the public
release by the Company of its quarterly earnings for the
second quarter of fiscal 1995, and (ii) annually
thereafter on the date of and following completion of
the Company's annual stockholders' meeting (commencing
with the 1996 annual stockholders' meeting). The number
of nonqualified options awarded to a director shall be
appropriately adjusted in the event of any stock changes
as described in Article XI.
B. This Fourth Amendment to the Plan shall be effective
upon its approval by the stockholders of the Company, and any
grant of Nonqualified Stock Options pursuant to the Fourth
Amendment shall be expressly conditioned upon such stockholder
approval.
