SEC Filing | Valmont Industries, Inc.

SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE THE SECURITIES EXCHANGE ACT OF 1934 [Fee Required] For the Fiscal Year Ended December 26, 1998 Commission File No. 0-3701 Valmont Industries, Inc. ------------------------ (Exact Name of Registrant as Specified in its Charter) Delaware 47-0351813 - --------------------------------- ------------------------------- (State or Other Jurisdiction (I.R.S. Employer Identification of Incorporation or Organization) Number) Valley, Nebraska 68064 ---------------- ---------- (Address of Principal Executive Offices) (Zip Code) Registrant's Phone Number, Including Area Code: (402) 359-2201 Securities Registered Pursuant to Section 12(g) of the Act: Valmont Industries, Inc. Common Stock ------------------------------------- $1.00 Par Value - Traded NASDAQ Stock Market (Symbol VALM) ---------------------------------------------------------- (Title of Class) ---------------- Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past ninety days. Yes X No ----- ----- At March 5, 1999 there were outstanding 24,528,973 common shares of the Company. The aggregate market value of the voting stock held by non-affiliates of the Company on March 5, 1999 was $198,421,000. Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. / / DOCUMENTS INCORPORATED BY REFERENCE Portions of the Company's annual report to shareholders for the fiscal year ended December 26, 1998 (the "Annual Report") are incorporated by reference in Parts I and II, and portions of the Company's proxy statement for its annual meeting of shareholders to be held on April 26, 1999 (the "Proxy Statement") are incorporated by reference in Part III. Page 1 of 203 ----- Index to Exhibits, Page 13 ----

PART I Item 1. BUSINESS. (a) General Description of Business Valmont Industries, Inc., a Delaware Corporation, (together with its subsidiaries the "Company") is engaged in infrastructure and irrigation businesses. The Infrastructure segment involves the manufacture and distribution of engineered metal structures for the lighting, utility and wireless communication industries. The Irrigation segment involves the manufacture and distribution of agricultural irrigation equipment and related products and services. The description of Valmont's businesses set forth on pages 6 through 21 of the Company's Annual Report is incorporated herein by reference. The Company entered the Irrigation market in 1953 from its manufacturing location in Valley, Nebraska. The Infrastructure segment began producing and marketing engineered metal structures in the early 1960's. Valmont has grown internally and by acquisition. Valmont has also divested certain businesses. Valmont's business expansions during the past five years include (i) the acquisition of Microflect Company, Inc. in 1995, a manufacturer and installer of microwave communication structures, (ii) the 1996 acquisitions of TelecCentre, S.A., a French manufacturer of communication towers, and of Valmont Mastbau, KG, a German manufacturer and distributor of pole structures for the lighting market, (iii) completion of the construction in 1997 of a new galvanizing plant in West Point, Nebraska, (iv) the acquisition in 1997 of a 70% interest in Valmont Services Irrigacao, Ltd., a Brazilian manufacturer of mechanized irrigation equipment, (v) the acquisition of two galvanizing facilities in Tualatin, Oregon and in Lindon, Utah in January of 1998, (vi) the expansion of facilities in Siedlce, Poland during 1997 and (vii) the acquisition of two additional galvanizing facilities in California and Oklahoma and the purchase of Cascade Earth Sciences, Ltd., a firm providing consulting services for environmental and wastewater management projects during 1998. Divestitures during the past five years include the January 1997 cash sale of the stock of Valmont Electric, Inc., a lighting ballast manufacturing business. (b) Operating Segments The Company's business activities are currently classified into the following operating segments: Infrastructure - This segment consists of the manufacture and distribution of engineered metal structures and related products for the lighting, utility and wireless communications industries. Irrigation - This segment includes the manufacture and distribution of agricultural irrigation equipment and related products and services. In addition to these two reportable segments, the Company has several other businesses that do not fit within the reportable segments listed above, and are not individually more than 10% of combined net sales. These businesses include custom coatings, steel tubing, pressure vessels, machine tool accessories and industrial fasteners. The amounts of revenues, operating income and total assets attributable to each segment for each of the last three years are set forth on page 45 of the Annual Report and incorporated herein by reference. 2

(c) Narrative Description of Business PRINCIPAL PRODUCTS PRODUCED AND SERVICES RENDERED. The information called for by this item is hereby incorporated by reference to pages 11 through 21 in the Company's Annual Report. SUPPLIERS AND AVAILABILITY OF RAW MATERIALS. Hot rolled steel coil and other carbon steel products are the primary raw materials utilized in the manufacture of finished products for the Industrial Products and Irrigation Products segments. These essential items are purchased from steel mills and steel service centers and are readily available. It is not likely that key raw materials would be unavailable for extended periods. PATENTS, LICENSES, FRANCHISES AND CONCESSIONS. Valmont has a number of patents for its irrigation designs. The Company also has a number of registered trademarks. Management believes the loss of any individual patent would not have a material adverse effect on the financial condition of the Company. SEASONAL FACTORS IN BUSINESS. Sales in the Company's irrigation segment can be somewhat seasonal based upon the agricultural growing season. CUSTOMERS. The Company is not dependent for a material part of its business upon a single customer, or upon very few customers, the loss of any one of which would have a material adverse effect on the financial condition of the Company. BACKLOG. The backlog of orders for the principal products manufactured and marketed was approximately $106.3 million at the end of the 1998 fiscal year and $125.6 million at the close of 1997. It is anticipated that most of the backlog of orders will be filled during fiscal year 1999. At year end, the backlog by segment was as follows (dollar amounts in millions): Dec. 26, Dec. 27, 1998 1997 --------- --------- Infrastructure $ 70.3 86.2 Irrigation 21.1 30.7 Other 14.9 8.7 ------ ----- $ 106.3 125.6 ------ ----- ------ ----- 3

COMPETITIVE CONDITIONS. In the Infrastructure segment, Valmont is a major manufacturer and supplier of engineered metal structures to the lighting and traffic, utility and wireless communication industries. The Irrigation segment involves the development, manufacture and distribution of mechanized irrigation equipment and related products for both the U.S. and international markets. The Company believes it is the world's leading manufacturer of mechanized irrigation systems. The Company delivers a broad line of custom engineered tubular steel products and manufactures and distributes fasteners. In addition, the Company supplies custom coating services. The key competitive strategy used by the Company in each segment is one of high quality and service. RESEARCH ACTIVITIES. The information called for by this item is hereby incorporated by reference to the "Research and Development" on page 43 in the Company's Annual Report. ENVIRONMENTAL DISCLOSURE. The Company is subject to various federal, state and local laws and regulations pertaining to environmental protection and the discharge of materials into the environment. Although the Company continues to incur expenses and to make capital expenditures related to environmental protection, it does not anticipate that future expenditures will materially impact the financial condition of the Company. NUMBER OF EMPLOYEES. At December 26, 1998, the number of employees was 3,869. GEOGRAHPIC AREAS. Valmont's international sales activity encompasses approximately ninety foreign countries. The information called for by this item is hereby incorporated by reference to "Summary by Geographical Area" on page 45 in the Annual Report. Item 2. PROPERTIES. The Company's primary plant and offices are located on a 352 acre site near Valley, Nebraska, which is approximately twenty miles west of Omaha, Nebraska. 336 of the acres are owned in fee. The other 16 acres are leased on a yearly basis from the Union Pacific Railroad Company, which serves the Company's primary plant, and which is entitled to terminate the lease on a one-year notice in the event that the land is required for railroad operations. The Valley, Nebraska location is used in common as the primary facilities by Irrigation segment and certain Infrastructure segment administrative and operating personnel. The Infrastructure segment's other significant properties are administrative, manufacturing and distribution facilities at Elkhart, Indiana, Tulsa, Oklahoma and Brehnam, Texas. The Oklahoma facility has 350,000 square feet under roof on 24 acres of land whereas the Texas facility is located on 109 acres and has eight buildings, with 318,000 square feet under 4

roof. Additionally the infrastructure segment leases office and plant facilities in Salem, Oregon under long-term leases. Overseas the Infrastructure segment has four locations in France, and one plant in each of the following countries: the Netherlands; Germany; Poland; and China. The Irrigation segment in addition to its operations at Valley, Nebraska, operates a mechanized irrigation facility in Uberaba, Brazil consisting of 135,000 square feet and a manufacturing facility for irrigation systems in Madrid, Spain. Currently under construction is a 310,000 square feet manufacturing facility in McCook, Nebraska, that will produce mechanized irrigation system components. The protective coatings division operates a 50,000 square foot facility in West Point, Nebraska and rents galvanizing facilities in Tualatin, Oregon, and Lindon, Utah; these two sites are 68,000 square feet and 36,000 square feet, respectively. During 1998 two additional coating plants were acquired that are located in Long Beach, California and Tulsa, Oklahoma. The Company operates other facilities as set forth on page 8 of the Company's Annual Report, which information is incorporated herein by reference. Item 3. PENDING LEGAL PROCEEDINGS. The Company is involved in a limited number of legal actions. Management believes that the ultimate resolution of all pending litigation will not have a material adverse effect on the Company's financial condition. Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. There were not any matters submitted for stockholder vote during the fourth quarter of 1998. EXECUTIVE OFFICERS OF THE COMPANY The executive officers of the Company at December 26, 1998, their ages, positions held, and the business experience of each during the past five years are, as follows: Mogens C. Bay, Age 50, Chairman and Chief Executive Officer of the Company since January 1997. President and Chief Executive Officer of the Company from August 1993 to December 1996 and Director of the Company since October 1993. Vincent T. Corso, Age 51, Senior Vice President, Chief Operating Officer of the Company since September of 1998. Group President and Chief Operating Officer-Irrigation & Coatings Group from December 1996 until September of 1998. Vice President - Operations from June 1994 until December 1996. Previously served as Vice President - Corporate Manufacturing, Emerson Electric from 1992 to June 1994. Thomas P. Egan, Jr., Age 50, Vice President, Corporate Counsel and Secretary of the Company since 1984. Terry J. McClain, Age 51, Senior Vice President and Chief Financial Officer. Previously Vice President and Chief Financial Officer of the Company from January 1994 until December 1996. 5

E. Robert Meaney, Age 51, Senior Vice President - Valmont International since September 1998. President and Chief Operating Officer - Valmont International from February 1994 to September 1998. Brian C. Stanley, Age 56, Vice President - Controller of the Company since January 1994. Mark E. Treinen Age 43, Vice President - Business Development since January 1994. 6

PART II Item 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS. Item 6. SELECTED FINANCIAL DATA. Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. The information called for by items 5, 6 and 7 is hereby incorporated by reference to the following captioned paragraphs (at the pages indicated) in the Company's Annual Report: Page(s) In Annual Item Caption in Annual Report Report ---- ------------------------ ---------- 5 Stock Trading 48 5 Stock Market Price and Dividends Declared 46 5 Approximate Number of Shareholders 34 - 35 5&6 Selected Eleven Year Financial Data 34 - 35 7 Management's Discussion and Analysis 29 - 33 7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The information called for by item 7A is hereby incorporated by reference to the captioned paragraph, Risk Management, in the Company's Annual Report on Page 32. Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA. The financial statements called for by this item are hereby incorporated by reference to the Company's Annual Report as set forth on pages 36 through 45, together with the independent auditors' report on page 47. The supplemental quarterly financial information is incorporated herein by reference to page 46 of the Company's Annual Report Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE. None. 7

PART III Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT. Item 11. EXECUTIVE COMPENSATION. Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT. Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. Except for the information relating to the executive officers of the Company set forth in Part I of this 10-K Report, the information called for by items 10, 11, 12 and 13 is hereby incorporated by reference to the sections entitled "Certain Shareholders", "Election of Directors", "Summary Compensation Table", "Stock Option Grants in Fiscal Year 1998", "Options Exercised in Fiscal Year 1998 and Fiscal Year End Values", "Long-Term Incentive Plans", and "Section 16(a) Beneficial Ownership Reporting Compliance" in the Company's Proxy Statement. PART IV Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K. (a)(1)(2) FINANCIAL STATEMENTS. See index to financial statement schedules on page F-1. (a)(3) EXHIBITS. See exhibit index, incorporated herein by reference. (b) REPORTS ON FORM 8-K. The Company filed no reports on Form 8-K during the past fiscal quarter. 8

VALMONT INDUSTRIES, INC. AND SUBSIDIARIES Index to Consolidated Financial Statements and Consolidated Financial Statement Schedules Consolidated Financial Statements The following consolidated financial statements of Valmont Industries, Inc. and subsidiaries have been incorporated by reference to pages 36 to 45 of the Company's Annual Report to Shareholders for the year ended December 26, 1998: Independent Auditors' Reports - Page 47 of the annual report. Consolidated Balance Sheets - December 26, 1998 and December 27, 1997 Consolidated Statements of Operations - Three-Year Period Ended December 26, 1998 Consolidated Statements of Shareholders' Equity - Three-Year Period Ended December 26, 1998 Consolidated Statements of Cash Flows - Three-Year Period Ended December 26, 1998 Notes to Consolidated Financial Statements - Three- Year Period Ended December 26, 1998 Page ---- Consolidated Financial Statement Schedule Supporting Consolidated Financial Statement SCHEDULE II - Valuation and Qualifying Accounts F-4 All other schedules have been omitted as the required information is inapplicable or the information is included in the consolidated financial statements or related notes. Separate financial statements of the Registrant have been omitted because the Registrant meets the requirements which permit omission. F-1 9

INDEPENDENT AUDITORS' REPORT ON FINANCIAL STATEMENT SCHEDULE To the Board of Directors and Shareholders of Valmont Industries, Inc. We have audited the consolidated financial statements of Valmont Industries, Inc. and Subsidiaries (the Company) as of December 26, 1998 and December 27, 1997, and for each of the three years in the period ended December 26,1998, and have issued our report thereon dated February 5, 1999; such financial statements and report are included in your 1998 Annual Report to Shareholders and are incorporated herein by reference. Our audits also included the financial statement schedule of the Company listed in Item 14 of this Form 10-K. This financial statement schedule is the responsibility of the Company's management. Our responsibility is to express an opinion based on our audits. In our opinion, such financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly in all material respects the information set forth therein. DELOITTE & TOUCHE LLP Omaha, Nebraska February 5, 1999 F-2 10

Schedule II VALMONT INDUSTRIES, INC. AND SUBSIDIARIES Valuation and Qualifying Accounts (Dollars in thousands) Balance at Charged to Deductions Balance at beginning profit and from close of period loss reserves* of period --------- ---------- ---------- --------- Fifty-two weeks ended December 26, 1998 Reserve deducted in balance sheet from the asset to which it applies - Allowance for doubtful receivables $ 2,132 1,522 233 3,421 ------- ----- ----- ----- ------- ----- ----- ----- Fifty-three weeks ended December 27, 1997 Reserve deducted in balance sheet from the asset to which it applies - Allowance for doubtful receivables $ 2,299 194 361 2,132 ------- ----- ----- ----- ------- ----- ----- ----- Fifty-two weeks ended December 28, 1996 Reserve deducted in balance sheet from the asset to which it applies - Allowance for doubtful receivables $ 2,941 796 1,438 2,299 ------- ----- ----- ----- ------- ----- ----- ----- *The deductions from reserves are net of recoveries. F-4 11

SIGNATURES The Registrant. Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Omaha, State of Nebraska, on the 24th day of March,1999. Valmont Industries, Inc. By: /S/Mogens C. Bay ---------------------------------- Mogens C. Bay Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of Valmont Industries, Inc. and in the capacities indicated on the dates indicated. /S/ Mogens C. Bay 3/24/99 - -------------------------- Director, President and ----------- Mogens C. Bay Chief Executive Officer Date (Principal Executive Officer) /S/ Terry J. McClain 3/24/99 - -------------------------- Vice President and ----------- Terry J. McClain Chief Financial Officer Date (Principal Financial Officer) /S/ Brian C. Stanley 3/24/99 - -------------------------- Vice President - Investor ---------- Brian C. Stanley Relations & Controller Date (Principal Accounting Officer) Robert B. Daugherty* John E. Jones * Charles M. Harper* Thomas F. Madison* Allen F. Jacobson* Walter Scott, Jr.* Lloyd P. Johnson * Kenneth E. Stinson* Robert G. Wallace * Charles D. Pebbler, Jr.* Bruce Rhode* *Mogens C. Bay, by signing his name hereto, signs the Annual Report on behalf of each of the directors indicated on this 24th day of March, 1999. A Power of Attorney authorizing Mogens C. Bay to sign the Annual Report of Form 10-K on behalf of each of the indicated directors of Valmont Industries, Inc. has been filed herein as Exhibit 24. By /S/ Mogens C. Bay ------------------------- Mogens C. Bay Attorney-in-Fact 12

INDEX TO EXHIBITS This Exhibit Index relates to exhibits filed as a part of this Report. Numbers are assigned to exhibits in accordance with Item 601 of Regulation S-K. Page numbers relate to the pages in the sequential numbering system where the exhibits can be found (for those exhibits which are not incorporated by reference). Exhibit 3(i) - The Company's Certificate of Incorporation, as amended. This document was filed with the Company's Quarterly Report on Form 10-Q for the quarter ended March 28, 1998 and is incorporated herein by reference. Exhibit 3(ii) - The Company's By-Laws, as amended. Page 15 Exhibit 4(i) - Rights Agreement dated as of December 19, 1995 between the Company and First National Bank of Omaha as Rights Agent. This document was filed with the Company's Current Report on Form 8-K dated December 19, 1995 and is incorporated herein by reference. Exhibit 4(ii) - Certificate of Adjustment dated May 30, 1997 to Rights Agreement dated as of December 19, 1995. This document was filed as Exhibit 4(b) with the Company's Annual Report on Form 10-K for fiscal year ended December 27, 1997 and is incorporated herein by reference. Exhibit 4(iii) - The Company's Credit Agreement with The Bank of New York dated October 7, 1997 as amended. Page 31 Exhibit 10(i) - The Company's 1988 Stock Plan and certain amendments. This document was filed as Exhibit 10(a) with the Company's Annual Report on Form 10-K for fiscal year ended December 27, 1997 and is incorporated herein by reference. Exhibit 10(ii) - The Company's 1996 Stock Plan. This document was filed as Exhibit 10(e) to the Company's Annual Report on Form 10-K for the fiscal year ended December 30, 1995 and is incorporated herein by reference. Exhibit 10(iii) - The Valmont Executive Incentive Plan. This document was Filed as Exhibit 10(c) to the Company's Annual Report on Form 10-K for the fiscal year ended December 30, 1995 and is incorporated herein by reference. Exhibit 10(iv) - The Amended Unfunded Deferred Compensation Plan for Nonemployee Directors. This document was filed as Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 28, 1998 and is incorporated herein by reference. 13

Exhibit 13 - The Company's Annual Report to Shareholders for its fiscal year ended December 26, 1998..............Page 148 Exhibit 21 - Subsidiaries of the Company..............................Page 201 Exhibit 23 - Consent of Deloitte and Touche LLP.......................Page 202 Exhibit 24 - Power of Attorney........................................Page 203 Exhibit 27 - Financial Data Schedule..................................Page 204 Pursuant to Item 601(b)(4) of Regulation S-K, certain instruments with respect to Valmont Industries' long-term debt are not filed with this Form 10-K. Valmont will furnish a copy of such long-term debt agreements to the Securities and Exchange Commission upon request. Management contracts and compensatory plans are set forth as exhibits 10(i) through 10(iv). 14

Exhibit 3(ii) BYLAWS OF VALMONT INDUSTRIES, INC. ARTICLE I Section 1. Annual Meeting. The annual meeting of the stockholders shall be held on a date and at an hour determined by the Board of Directors, for the purpose of electing directors and for the transaction of such other business as may come before the meeting. Section 2. Special Meetings. Special meetings of the stockholders, for any purpose or purposes, may be called at any time by the President of this Corporation, who shall call the same upon demand in writing being made upon such person by a majority of the directors of the Corporation. Section 3. Place of Meetings. The Board of Directors may designate any place, either within or without the State of Delaware as the place of meeting for any annual meeting or for any special meeting called by the Board of Directors. Section 4. Notice of Meeting. Notice of a meeting of stockholders stating the place, day and hour of the meeting and, in the case of a special meeting, the purpose or purposes for which the meeting is called, shall be given not less than ten nor more than sixty days before the date of the meeting by or at the direction of the President or the Secretary to each stockholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail, addressed to the stockholder at the stockholder's address as it appears on the stock transfer books of the Corporation, with postage thereon prepaid. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to the notice of meeting. Any previously scheduled meeting of the stockholders may be postponed, and (unless the Certificate of Incorporation otherwise provides) any special meeting of the stockholders may be cancelled, by resolution of the Board of Directors upon public notice given prior to the date previously scheduled for such meeting of stockholders. Section 5. Record Date. For the purpose of determining stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or stockholders entitled to receive payment of any dividend, or in order to make a determination of stockholders for any other purpose, the Board of Directors of the Corporation shall fix in advance a date as the 15

record date for any such determination of stockholders, such date in any case to be not less than ten days nor more than sixty days prior to the date on which the particular action requiring such determination of stockholders is to be taken. If no record date is fixed for the determination of stockholders entitled to notice of or to vote at a meeting of stockholders, or stockholders entitled to receive payment of a dividend, the date on which notice of the meeting is mailed or the date on which the resolution of the Board of Directors declaring such dividend is adopted, as the case may be, shall be the record date for such determination of stockholders. When a determination of stockholders entitled to vote at any meeting of stockholders has been made as provided in this section, such determination shall apply to any adjournment thereof. Section 6. Voting Lists. The officer or agent having charge of the stock transfer books for shares of the Corporation shall make, at least ten days before each meeting of stockholders, a complete list of the stockholders entitled to vote at such meeting, or any adjournment thereof, arranged in alphabetical order, with the address of and the number of shares held by each, which list, for a period of ten days prior to such meeting, shall be kept on file at the registered office of the Corporation and shall be subject to inspection by any stockholder at any time during usual business hours. Such list shall also be produced and kept open at the time and place of the meeting and shall be subject to the inspection of any stockholder during the whole time of the meeting. The original stock transfer book shall be prima facie evidence as to who are the stockholders entitled to examine such list or transfer books or to vote at any meeting of stockholders. Section 7. Quorum. A majority of the outstanding shares of the Corporation entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of stockholders. If less than a majority of the outstanding shares are represented at a meeting, the Chairman or a majority of the shares so represented may adjourn the meeting from time to time without further notice. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally notified. The stockholders present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less than a quorum. Section 8. Proxies; Voting. At all meetings of stockholders, a stockholder may vote by proxy. Such proxy shall be filed with the Secretary of the Corporation before or at the time of the meeting. No proxy shall be valid after eleven months from the date of its execution, unless otherwise provided in the proxy. Section 9. Voting of Shares. In each meeting of stockholders except as otherwise provided by statute or the Certificate of Incorporation, every holder of record of stock entitled to vote shall be entitled to one vote in person or by proxy for each share 16

of such stock standing in such holder's name on the records of the Corporation. At all meetings of stockholders for the election of directors a plurality of the votes cast shall be sufficient to elect the directors. All other elections and questions shall, unless otherwise provided by the Certificate of Incorporation, these By-Laws, the rules or regulations of NASD or any stock exchange applicable to Valmont, as otherwise provided by law or pursuant to any regulation applicable to Valmont or its securities, be decided by the affirmative vote of the holders of a majority of the shares of stock of Valmont which are present in person or by proxy and entitled to vote thereon. Section 10. Voting of Shares by Certain Holders. Shares standing in the name of another corporation may be voted by such officer, agent or proxy as the Bylaws of such corporation may prescribe, or, in the absence of such provision, as the Board of Directors of such corporation may determine. Shares held by an administrator, executor, guardian or conservator may be voted by such person, either in person or by proxy, without a transfer of such shares into such person's name. Shares standing in the name of a trustee may be voted by such person, either in person or by proxy, but no trustee shall be entitled to vote shares held without a transfer of such shares into such trustee's name. Shares standing in the name of a receiver may be voted by such receiver, and shares held by or under the control of a receiver may be voted by such receiver without the transfer thereof into such receiver's name if authority so to do be contained in an appropriate order of the court by which such receiver was appointed. A stockholder whose shares are pledged shall be entitled to vote such shares until such shares have been transferred into the name of the pledgee, and thereafter the pledgee shall be entitled to vote the shares so transferred. Shares of its own stock belonging to the Corporation or held by it in a fiduciary capacity shall not be voted, directly or indirectly, at any meeting, and shall not be counted in determining the total number of outstanding shares at any given time. Nothing herein shall be construed as limiting the right of Valmont to vote stock, including but not limited to its own stock, held by it in a fiduciary capacity. Section 11. Notice of Stockholder Business. At an annual meeting of the stockholders, only such business shall be conducted as shall have been brought before the meeting (a) by or at the direction of the Board of Directors or (b) by any stockholder of Valmont who was a stockholder of record at the time of giving of notice provided for in Section 4, who is entitled to vote at the meeting and who complies with the notice procedures set forth in this Section 11. For business to be properly brought before an annual meeting by a stockholder, a stockholder must have given timely notice thereof in writing to the Secretary of Valmont and 17

such business must otherwise be a proper matter for stockholder action. To be timely, a stockholder's notice must be delivered to or mailed and received at the principal executive offices of Valmont, not less than 90 nor more than 120 days prior to the first anniversary of the preceding year's annual meeting; provided, however, that in the event the date of the annual meeting is advanced by more than 30 days, or delayed by more than 60 days, from such anniversary date, notice by the stockholder to be timely must be so delivered or mailed and received not earlier than the 120th day prior to such annual meeting and not later than the close of business on the later of the 90th day prior to such annual meeting or the tenth day following the date on which public announcement of the date of such meeting is first made. In no event shall the public announcement of an adjournment or postponement of an annual meeting commence a new time period (or extend any time period) for the giving of a stockholder's notice as described above. A stockholder's notice to the Secretary shall set forth as to each matter the stockholder proposes to bring before the annual meeting (a) a description of the business desired to be brought before the annual meeting, the text of the proposal or business (including the text of any resolutions proposed for consideration and in the event that such business includes a proposal to amend the By-Laws of Valmont, the language of the proposed amendment), and the reasons for conducting such business at the annual meeting, (b) the name and address, as they appear on Valmont's books, of the stockholder proposing such business, and the name and address of the beneficial owner, if any, on whose behalf the proposal is made, (c) the class and number of shares of Valmont which are owned of record and beneficially by the stockholder and the beneficial owner, if any, (d) any material interest of the stockholder and beneficial owner, if any, in such business, (e) a representation that the stockholder is a holder of record of stock of Valmont entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to propose such business and (f) a representation whether the stockholder or the beneficial owner, if any, intends or is part of a group which intends to (i) deliver a proxy statement and/or form of proxy to holders of at least the percentage of Valmont's outstanding capital stock required to approve or adopt the proposal and/or (ii) otherwise solicit proxies from stockholders in support of such proposal. Notwithstanding anything in the Bylaws to the contrary, no business shall be conducted at an annual meeting except in accordance with the procedures set forth in this Section 11. The Chairman of an annual meeting shall, if the facts warrant, determine and declare to the meeting that business was not properly brought before the meeting in accordance with the provisions of this Section 11, and if the Chairman should so determine, shall so declare to the meeting and any such business not properly brought before the meeting shall not be transacted. Section 12. Notice of Director Nominees at an Annual Meeting. Only persons who are nominated with the procedures set forth in these Bylaws shall be eligible for election as directors. Nominations of persons for election to the Board of Directors of Valmont may be made at an annual meeting of stockholders (a) by or 18

at the direction of the Board of Directors or (b) by any stockholder of Valmont who was a stockholder of record at the time of giving of notice provided for in Section 4, who is entitled to vote at the annual meeting and who complies with the notice procedures set forth in this Section 12. Such nominations, other than those made by or at the direction of the Board of Directors, shall be made pursuant to timely notice in writing to the Secretary of Valmont. To be timely, a stockholder's notice shall be delivered to or mailed and received at the principal executive offices of Valmont not less than 90 nor more than 120 days prior to the first anniversary of the preceding year's annual meeting; provided, however, that in the event the date of the annual meeting is advanced by more than 30 days, or delayed by more than 60 days, from such anniversary date, notice by the stockholder to be timely must be so delivered or mailed and received not earlier than the 120th day prior to such annual meeting and not later than the close of business on the later of the 90th day prior to such annual meeting or the tenth day following the date on which public announcement of the date of such meeting is first made. In no event shall the public announcement of an adjournment or postponement of an annual meeting commence a new time period (or extend any time period) for the giving of a stockholder's notice as described above. Such stockholder's notice shall set forth (a) as to each person whom the stockholder proposes to nominate for election or re-election as a director, all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (including such person's written consent to be named as a nominee and to serving as the director if elected), and (b) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination is made, (i) the name and address, as they appear on Valmont's books, of such stockholder and the name and address of the beneficial owner, if any, (ii) the class and number of shares of Valmont which are owned of record and beneficially by such stockholder and the beneficial owner, if any, (iii) a representation that the stockholder is a holder of record of stock of Valmont entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to propose such nomination, and (iv) a representation whether the stockholder or the beneficial owner, if any, intends or is part of a group which intends to (a) deliver a proxy statement and/or form of proxy to holders of at least the percentage of Valmont's outstanding capital stock required to elect the nominee and/or (b) otherwise solicit proxies from stockholders in support of such nomination. At the request of the Board of Directors any person nominated by the Board of Directors for election as a director shall furnish to the Secretary of Valmont that information required to be set forth in a stockholder's notice of nomination which pertains to the nominee. No person shall be eligible for election as a director of Valmont unless nominated in accordance with the procedures set forth in the Bylaws. The Chairman of the meeting shall, if the facts warrant, determine and declare to the meeting that a nomination was not made in accordance with the procedures prescribed by the Bylaws, and if 19

the Chairman should so determine, shall so declare to the meeting and the defective nomination shall be disregarded. Section 13. Notice of Director Nominees at a Special Meeting. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to Valmont's notice of meeting. Nominations of persons for election to the Board of Directors may be made at a special meeting of stockholders at which directors are to be elected pursuant to Valmont's notice of meeting (a) by or at the direction of the Board of Directors or (b) provided that the Board of Directors has determined that directors shall be elected at such meeting, by any stockholder of Valmont who is a stockholder of record at the time of giving of notice provided for in Section 4, who shall be entitled to vote at the special meeting and who complies with the notice procedures set forth in Section 12. In the event Valmont calls a special meeting of stockholders for the purpose of electing one or more directors to the Board of Directors, any such stockholder may nominate a person or persons (as the case may be), for election to such position(s) as specified in Valmont's notice of meeting, if the stockholder's notice required by Section 12 shall be delivered to the Secretary at the principal executive offices of Valmont not earlier than the close of business on the 120th day prior to such special meeting and not later than the close of business on the later of the 90th day prior to such special meeting or the 10th day following the day on which public announcement is first made of the date of the special meeting and of the nominees proposed by the Board of Directors to be elected at such meeting. In no event shall the public announcement of an adjournment or postponement of a special meeting commence a new time period (or extend any time period) for the giving of a stockholder's notice as described above. Section 14. Inspectors of Elections. The Board of Directors by resolution shall appoint one or more inspectors, which inspector or inspectors may include individuals who serve Valmont in other capacities, including, without limitation, as officers, employees, agents or representatives, to act at the meetings of stockholders and make a written report thereof. One or more persons may be designated as alternate inspectors to replace any inspector who fails to act. If no inspector or alternate has been appointed to act or is able to act at a meeting of stockholders, the Chairman of the meeting shall appoint one or more inspectors to act at the meeting. Each inspector, before discharging his or her duties, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of his or her ability. The inspectors shall have the duties prescribed by law. Section 15. Conduct of Meetings. The date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at a meeting shall be announced at the meeting by the person presiding over the meeting. The Board of Directors may adopt by resolution such rules and regulations for the conduct of the meeting of stockholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as 20

adopted by the Board of Directors, the Chairman of any meeting of stockholders shall have the right and authority to convene and to adjourn the meeting, to prescribe such rules, regulations and procedures and to do all such acts, as in the judgment of such Chairman, are appropriate for the proper conduct of the meeting. Unless and to the extent determined by the Board of Directors or the Chairman of the meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure. ARTICLE II BOARD OF DIRECTORS Section 1. General Powers. The business and affairs of the Corporation shall be managed by its Board of Directors. In addition to the powers and authorities by these By-Laws expressly conferred upon them, the Board of Directors may exercise all such powers of Valmont and do all such lawful acts and things as are not by statute or by the Certificate of Incorporation or by these By-Laws required to be exercised or done by the stockholders. Section 2. Number, Tenure and Qualifications. The number of directors of the Corporation shall be fixed by resolution of the Board of Directors, and may be altered from time to time by a majority vote of the members of the Board of Directors present at any regular or special meeting of the Board. The directors shall be divided into three classes: Class I, Class II and Class III, each such class, as nearly as possible, to have the same the number of directors. At each annual election of directors by the stockholders of Valmont, the directors chosen to succeed those whose terms are then expired shall be identified as being of the same class as the directors they succeed and shall be elected by the stockholders of Valmont for a term expiring at the third succeeding annual election of directors, or thereafter when their respective successors in each case are elected by the stockholders and qualify. Section 3. Regular Meetings. A regular meeting of the Board of Directors shall be held on the same date as the annual meeting of stockholders. The Board of Directors may provide, by resolution, the time and place, either within or without the State of Delaware, for the holding of additional regular meetings. Section 4. Special Meetings. Special meetings of the Board of Directors may be called by or at the request of the President or a majority of the board of directors. The person or persons authorized to call the special meetings of the Board of Directors may fix any place, either within or without the State of Delaware, as the place for holding any special meeting of the Board of Directors called by them. Section 5. Notice. Notice of any special meeting shall be given at least two days in advance thereof. Notices of meetings of 21

the Board of Directors may be given by mail or may (and, if three or fewer days notice is given, shall) be given by telegram, telephone, personal delivery, telecopier or other means of electronic transmission. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail so addressed, with postage thereon prepaid. If notice be given by telegram such notice shall be deemed to be delivered when transmitted. Any director may waive notice of any meeting. The attendance of a director at a meeting shall constitute a waiver of notice of such meeting, except where a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Board of Directors need be specified in the notice or waiver of notice of such meeting. Section 6. Quorum. A majority of the number of directors fixed in accordance with Section 2 of this Article II shall constitute a quorum for the transaction of business at any meeting of the Board of Directors, but if less than such majority is present at a meeting, a majority of the directors present may adjourn the meeting from time to time without further notice. Section 7. Manner of Acting. Except as otherwise required by applicable law, the act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors. Any action required or permitted to be taken at any meeting of the Board of Directors may be taken without a meeting if a written consent thereto is signed by all members of the board and such written consent is filed with the minutes of the proceedings of the Board. A consent in lieu of meeting may be made either by one consent signed by all the directors or by individual consents signed by each director. The directors may also meet by means of conference telephone or similar communications equipment as provided by Delaware law. Section 8. Vacancies. Vacancies and newly created directorships resulting from any increase in the authorized number of directors may be filled by the affirmative vote of the majority of the remaining directors though less than a quorum of the Board of Directors. Directors so chosen shall hold office for a term expiring at the annual meeting of stockholders at which the term of office of the class to which they have been elected expires and until such director's successor shall have been duly elected and qualified. No decrease in the number of authorized directors constituting the full Board of Directors shall shorten the term of any incumbent director. Section 9. Compensation. By resolution of the Board of Directors, the directors may be paid their expenses, if any, of attendance at each meeting of the Board of Directors, and may be paid a fixed sum for attendance at each meeting of the Board of Directors or a stated salary as director. No such payment shall preclude any director from serving the Corporation in any other capacity and receiving compensation therefore. 22

Section 10. Presumption of Assent. A director of the Corporation who is present at a meeting of the Board of Directors at which action on any corporate matter is taken shall be presumed to have assented to the action taken unless a dissent shall be entered into the minutes of the meeting or unless such person shall file a written dissent to such action with the person acting as the Secretary of the meeting before the adjournment thereof or shall forward such dissent by registered mail to the Secretary of the Corporation immediately after the adjournment of the meeting. Such right to dissent shall not apply to a director who voted in favor of such action. Section 11. Committees. The Board of Directors may in its discretion, by resolution passed by a majority of the whole Board, designate from among its members one or more committees which shall consist of two or more directors. The Board may designate one or more directors as alternate members of any such committee who may replace any absent or disqualified member at any meeting of the committee. Except as otherwise required by applicable law, such committees shall have and may exercise such powers as shall be conferred or authorized by the resolution appointing them. A majority of any such committee may determine its action and fix the time and place of its meetings unless the Board of Directors shall otherwise provide. The Board shall have power at any time to change the membership of any such committee to fill vacancies in it or to dissolve it. Section 12. Executive Committee. There may be an Executive Committee of the Board of Directors consisting of directors chosen by the Board. The Executive Committee shall have power to take any and all action which the Board of Directors might itself have the legal power to take at any time between meetings of the Board of Directors; provided, however, that such Committee shall not have the power to take action on any of the following matters, the exclusive power to deal with which is resolved to the Board of Directors: filling of vacancies on the Board of Directors or Executive Committee; fixing of compensation of officers; approval of any borrowings by the Corporation which involve the issuance of securities having a maturity of longer than one year from the date of issue or which involve the creation of any mortgages, liens, pledges or other encumbrances on any substantial portion of the corporate assets; approval of any amendment to the Certificate of Incorporation or Bylaws; approval of or recommending to the stockholders any sale, lease or exchange of all or substantially all of the Corporation's property and assets; declaration of a dividend or authorization of an issuance of stock; or approval of a dissolution or liquidation of the Corporation. 23

ARTICLE III OFFICERS Section 1. Number. The officers of the corporation shall be a President, one or more Vice Presidents (the number thereof to be determined by the Board of Directors), a Secretary, and a Treasurer, each of whom shall be elected by the Board of Directors. Such other officers and assistant officers as may be deemed necessary may be elected or appointed by the Board of Directors. Any two or more offices may be held by the same person, except the offices of President and Secretary. Section 2. Election and Term of Office. The officers of the Corporation to be elected by the Board of Directors shall be elected annually by the Board of Directors at the first meeting of the Board of Directors held after each annual meeting of the stockholders. If the election of officers shall not be held at such meeting, such election shall be held as soon thereafter as conveniently may be. Each officer shall hold office until his successor shall have been duly elected and shall have qualified or until his death or until such person shall resign or shall have been removed in the manner hereinafter provided. Section 3. Removal. Any officer or agent elected or appointed by the Board of Directors may be removed by the Board of Directors whenever in its judgment the best interests of the Corporation would be served thereby, but such removal shall be without prejudice to the contract rights, if any, of the person so removed. Section 4. Vacancies. A vacancy in an office because of death, resignation, removal, disqualification or otherwise, may be filled by the Board of Directors for the unexpired portion of the term. Section 5. President. The President shall be the principal executive officer of the Corporation and, subject to the control of the Board of Directors, shall in general supervise and control all of the business and affairs of the Corporation. The President shall, when present, preside at all meetings of the stockholders and of the Board of Directors. The President may sign, with the Secretary or any other proper officer of the Corporation thereunto authorized by the Board of Directors, certificates for shares of the Corporation, any deeds, mortgages, bonds, contracts, or other instruments which the Board of Directors has authorized to be executed, except in cases where the signing and execution thereof shall be expressly delegated by the Board of Directors or by these Bylaws to some other officer or agent of the Corporation, or shall be required by law to be otherwise signed or executed; and in general shall perform all duties incident to the office of President and such other duties as may be prescribed by the Board of Directors from time to time. 24

Section 6. Acting President; Vice Presidents. In the absence of the President, or in the event of his death, inability or refusal to act, the Board of Directors shall select the acting President, who shall perform the duties of the President, and when so acting, shall have all the powers of and be subject to all the restrictions upon the President. Any Vice President may sign, with the Secretary or an Assistant Secretary, certificates for shares of the Corporation and shall perform such other duties as from time to time may be assigned by the President or by the Board of Directors. Section 7. The Secretary. The Secretary shall: (a) keep the minutes of the stockholders' and of the Board of Directors' meetings in one or more books provided for that purpose; (b) see that all notices are duly given in accordance with the provisions of these Bylaws or as required by law; (c) be custodian of the corporate records and of the seal of the Corporation and see that the seal of the Corporation is affixed to all documents the execution of which on behalf of the Corporation under its seal is duly authorized; (d) keep a register of the post office address of each stockholder which shall be furnished to the Secretary by such stockholder; (e) sign with the President, or a Vice President, certificates for shares of the Corporation, the issuance of which shall have been authorized by resolution of the Board of Directors; (f) have general charge of the stock transfer books of the Corporation; and (g) in general perform all duties incident to the office of Secretary and such other duties as from time to time may be assigned by the President or by the Board of Directors. Section 8. The Treasurer. If required by the Board of Directors, the Treasurer shall give a bond for the faithful discharge of his duties in such sum and with such surety or sureties as the Board of Directors shall determine. The Treasurer shall: (a) have charge and custody of and be responsible for all funds and securities of the Corporation; receive and give receipts for moneys due and payable to the Corporation from any source whatsoever, and deposit all such moneys in the name of the Corporation in such banks, trust companies or other depositories as shall be selected in accordance with provisions of Article V of these Bylaws; and (b) in general perform all of the duties incident to the office of Treasurer and such other duties as from time to time may be assigned by the President or by the Board of Directors. Section 9. Assistant Secretaries and Assistant Treasurers. The Assistant Secretaries, when authorized by the Board of Directors, may sign with the President or a Vice President certificates for shares of the Corporation the issuance of which shall have been authorized by a resolution of the Board of Directors. The Assistant Treasurers shall respectively, if required by the Board of Directors, give bonds for the faithful discharge of their duties in such sums and with such sureties as the Board of Directors shall determine. The Assistant Secretaries and Assistant Treasurers, in general, shall perform such duties as 25

shall be assigned to them by the Secretary or the Treasurer, respectively, or by the President or the Board of Directors. Section 10. Salaries. The salaries of the officers shall be fixed from time to time by the Board of Directors and no officer shall be prevented from receiving such salary by reason of the fact that such person is also a director of the Corporation. ARTICLE IV INDEMNIFICATION Section 1. Actions by Others. Valmont shall indemnify any person who was or is a party to or is threatened to be made a party to any threatened, pending or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative (other than an action by or in the right of Valmont) by reason of the fact that such person is or was a director, officer, employee or agent of Valmont, or is or was serving at the request of Valmont as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, or other enterprise, against expenses (including attorneys' fees), judgments, fines, and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of Valmont, and, with respect to any criminal action or proceedings, had no reasonable cause to believe the conduct was criminal. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which such person reasonably believed to be in or not opposed to the best interests of Valmont, and, with respect to any criminal action or proceeding, had reasonable cause to believe that the conduct was criminal. Section 2. Actions by or in the Right of Valmont. Valmont shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of Valmont to procure a judgment in its favor by reason of the fact that such person is or was a director, officer, employee or agent of Valmont, or is or was serving at the request of Valmont as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys' fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of Valmont and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to Valmont unless and only to the extent that the Delaware Court of Chancery or the court in which such action or suit was brought shall determine upon application that despite the 26

adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Delaware Court of Chancery or such other court shall deem proper. Section 3. Successful Defense. To the extent that a director, officer, employee or agent of Valmont has been successful on the merits or otherwise, including, without limitation, the dismissal of an action without prejudice, in defense of any action, suit or proceeding referred to in Sections 1 and 2 of this Article, or in defense of any claims, issue or matter therein, such person shall be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by such person in connection therewith. Section 4. Specific Authorization. Any indemnification under Sections 1 and 2 of this Article (unless ordered by a court) shall be made by Valmont only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances because such person has met the applicable standard of conduct set forth in said Sections 1 and 2. Such determination shall be made: (a) by the Board of Directors by a majority vote of a quorum consisting of directors who were not parties to such action, suit or proceeding; or (b) if such quorum is not obtainable, or, even if obtainable a quorum of disinterested directors so directs, by independent legal counsel in a written opinion; or (c) by the stockholders. Section 5. Advance of Expenses. Expenses incurred by an elected officer or director in defending a civil or criminal action, suit or proceeding shall be paid by Valmont in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or elected officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by Valmont as authorized in this Article. Such expenses incurred by other officers, employees and agents may be so paid upon such terms and conditions, if any, as the Board of Directors deems appropriate. Section 6. Right of Indemnity not Exclusive. The indemnification and advancement of expenses provided by or granted pursuant to the Certificate of Incorporation or these Bylaws shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any Bylaw, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office. Section 7. Insurance. Valmont may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of Valmont, or is or was serving at the request of Valmont as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other 27

enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of the status as such, whether or not Valmont would have the power to indemnify such person against such liability under the provisions of this Article, Section 145 of the General Corporation Law of the State of Delaware, or otherwise. Section 8. Employee Benefit Plan. For purposes of this Article, references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to "serving at the request of Valmont" shall include any service as a director, officer, employee or agent of Valmont which imposes duties on, or involves services by such director, officer, employee or agent with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner "not opposed to the best interests of Valmont" as referred to in this Article. Section 9. Invalidity of any Provisions of this Article. The invalidity or unenforceability of any provision of this Article shall not affect the validity or enforceability of the remaining provisions of this Article. Section 10. Continuation of Indemnification. The indemnification and advancement of expenses, to the extent provided by or granted pursuant to this Article, these Bylaws, or the Certificate of Incorporation shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such person. All rights to indemnification provided by or granted pursuant to this Article, these Bylaws, or the Certificate of Incorporation shall be deemed to be a contract between Valmont and each director, officer, employee or agent of Valmont who serves or served in such capacity at any time while this Article IV is in effect. Any repeal or modification of this Article IV shall not in any way diminish any rights or indemnification of such director, officer, employee or agent, or the obligations of Valmont arising hereunder. Section 11. Certain Claims. Notwithstanding Section 1 and Section 2 of this Article IV, Valmont shall be required to indemnify a person described in the first sentence of Section 1 or Section 2 of this Article IV in connection with an action, suit or proceeding (or part thereof) commenced by such a person only if the commencement of such proceeding (or part thereof) by such person was authorized by the Board of Directors. 28

ARTICLE V CONTRACTS, LOANS, CHECKS AND DEPOSITS Section 1. Contracts. The Board of Directors may authorize any officer or officers, agent or agents, to enter into any contract or execute and deliver any instrument in the name of and on behalf of the Corporation, and such authority may be general or confined to specific instances. Section 2. Loans. No loans shall be contracted on behalf of the Corporation and no evidences of indebtedness shall be issued in its name unless authorized by a resolution of the Board of Directors. Such authority may be general or confined to specific instances. Section 3. Checks, Drafts, Etc. All checks, drafts or other orders for the payment of money, notes or other evidences of indebtedness issued in the name of the Corporation, shall be signed by such officer or officers, agent or agents of the Corporation and in such manner as shall from time to time be determined by resolution of the Board of Directors. Section 4. Deposits. All funds of the Corporation not otherwise employed shall be deposited from time to time to the credit of the Corporation in such banks, trust companies or other depositories as the Board of Directors may select. ARTICLE VI CERTIFICATES FOR SHARES AND THEIR TRANSFER Section 1. Certificates for Shares. Certificates representing shares of the Corporation shall be in such form as shall be determined by the Board of Directors. Such certificates shall be signed by the President or a Vice President and by the Secretary or an Assistant Secretary. All certificates for shares shall be consecutively numbered or otherwise identified. The name and address of the person to whom the shares represented thereby are issued, with the number of shares and date of issue, shall be entered on the stock transfer books of the Corporation. All certificates surrendered to the Corporation for transfer shall be canceled and no new certificates shall be issued until the former certificate for a like number of shares shall have been surrendered and canceled, except that in the case of a lost, destroyed or mutilated certificate, a new one may be issued therefor upon such terms and indemnity to the Corporation as the Board of Directors may prescribe. Section 2. Transfer of Shares. Transfer of shares of the Corporation shall be made only on the stock transfer books of the Corporation by the holder of record thereof or by his legal representative, who shall furnish proper evidence of authority to transfer, or by his attorney thereunto authorized by power of attorney duly executed and filed with the Secretary of the 29

Corporation, and on surrender for cancellation of the certificate for such shares. The person in whose name shares stand on the books of the Corporation shall be deemed by the Corporation to be the owner thereof for all purposes. ARTICLE VII FISCAL YEAR The fiscal year of the Corporation shall end on the last Saturday of December in each year. ARTICLE VIII DIVIDENDS The Board of Directors may, from time to time, declare and the Corporation may pay dividends on its outstanding shares in the manner and upon the terms and conditions provided by law and its Certificate of Incorporation. ARTICLE IX SEAL The Board of Directors shall provide a corporate seal which shall be circular in form and shall have inscribed thereon the name of the Corporation and the state of incorporation and the words, "Corporate Seal." ARTICLE X WAIVER OF NOTICE Whenever any notice is required to be given to any stockholders or directors of the Corporation under the provisions of these Bylaws or under the provisions of the Certificate of Incorporation or under the provisions of the General Corporation Law of the State of Delaware, a waiver thereof in writing, signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice. ARTICLE XI AMENDMENTS These Bylaws may be altered, amended or repealed and new Bylaws may be adopted by the Board of Directors at any regular or special meeting of the Board of Directors. 30

- -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Exhibit 4(iii) CREDIT AGREEMENT by and among VALMONT INDUSTRIES, INC., THE SUBSIDIARY BORROWERS PARTY HERETO, THE LENDERS PARTY HERETO, and THE BANK OF NEW YORK, AS ISSUING BANK, AS SWING LINE LENDER and AS ADMINISTRATIVE AGENT with BNY CAPITAL MARKETS, INC., AS ARRANGER Dated as of October 7, 1997 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 31

CREDIT AGREEMENT, dated as of October 7, 1997, by and among VALMONT INDUSTRIES, INC., a Delaware corporation (the "PARENT BORROWER"), the direct and indirect wholly-owned Subsidiaries of the Parent Borrower party hereto or which from time to time become party hereto (each a "SUBSIDIARY BORROWER" and, collectively, the "SUBSIDIARY BORROWERS"), the lenders party hereto (each a "LENDER" and, collectively, the "LENDERS"), and THE BANK OF NEW YORK ("BNY"), as issuing bank (in such capacity, the "ISSUING BANK"), as swing line lender (in such capacity, the "SWING LINE LENDER"), and as administrative agent for the Lenders, the Issuing Bank and the Swing Line Lender (in such capacity, the "ADMINISTRATIVE AGENT"). 1. DEFINITIONS AND PRINCIPLES OF CONSTRUCTION 1.1. DEFINITIONS As used in this Agreement, terms defined in the preamble have the meanings therein indicated, and the following terms have the following meanings: "ABR ADVANCES": the Revolving Credit Loans (or any portions thereof), at such time as they (or such portions) are made and/or being maintained at a rate of interest based upon the Alternate Base Rate. "ACCOUNTANTS": Deloitte & Touche LLP (or any successor thereto), or such other firm of certified public accountants of recognized national standing selected by the Parent Borrower. "ACCUMULATED FUNDING DEFICIENCY": as defined in Section 302 of ERISA. "ACQUISITION": with respect to any Person, the purchase or other acquisition by such Person, by any means whatsoever (including through a merger, dividend, or otherwise and whether in a single transaction or in a series of related transactions), of (i) any Capital Stock of any other Person if, immediately thereafter, such other Person would be either a Subsidiary of such Person or otherwise under the control of such Person, (ii) any business, going concern, or divisions or segment of any other Person, or (iii) any Property of any other Person other than in the ordinary course of business, PROVIDED, HOWEVER, that no acquisition of all or substantially all of the assets of such other Person shall be deemed to be in the ordinary course of business. "ACTIVE SUBSIDIARY BORROWER": at any time, any Subsidiary Borrower other than an Inactive Subsidiary Borrower. "ADVANCE": an ABR Advance, a Eurodollar Advance, or a Core Currency Euro Advance, as the case may be. "AFFECTED ADVANCE": as defined in Section 3.8. 32

"AGENT PAYMENT OFFICE": (i) with respect to all amounts owing under the Loan Documents (other than in respect of Alternate Currency Loans), initially, the office, branch, affiliate, or correspondent bank of the Administrative Agent designated as its "DOMESTIC PAYMENT OFFICE" in Exhibit M and, thereafter, such other office, branch, affiliate, or correspondent bank thereof as it may from time to time designate in writing as such to the Parent Borrower, the Issuing Bank, the Swing Line Lender and each Lender, and (ii) with respect to all amounts owing in respect of each Alternate Currency Loan, initially, the office, branch, affiliate, or correspondent bank of the Administrative Agent designated as its payment office for the applicable Alternate Currency in Exhibit M and, thereafter, such other office, branch, affiliate, or correspondent bank thereof as it may from time to time designate in writing as such to the Parent Borrower, the Issuing Bank, the Swing Line Lender and each Lender. "AFFILIATE": as to any Person, any other Person which, directly or indirectly, is in control of, is controlled by, or is under common control with, such Person. For purposes of this definition, control of a Person shall mean the power, direct or indirect, to direct or cause the direction of the management and policies of such Person, whether by contract or otherwise. "AGGREGATE CREDIT EXPOSURE": at any time, the sum at such time of (i) the outstanding principal amount of the Revolving Credit Loans and Bid Loans of all Lenders (determined, in the case of each Alternate Currency Loan, on the basis of the Dollar Equivalent thereof), PLUS (ii) the outstanding principal amount of the Swing Line Loans, PLUS (iii) an amount equal to the Letter of Credit Exposure of all Lenders. "AGGREGATE REVOLVING CREDIT COMMITMENT AMOUNT": at any time, the sum at such time of the Revolving Credit Commitment Amounts of all Lenders. "AGREEMENT": this Credit Agreement, as the same may be amended, supplemented, or otherwise modified from time to time. "ALTERNATE BASE RATE": on any date, a rate of interest per annum equal to the higher of (i) the Federal Funds Rate in effect on such date plus 1/2 of 1% and (ii) the BNY Rate in effect on such date. "ALTERNATE CURRENCY": any Currency (other than Dollars). "ALTERNATE CURRENCY BID LOAN": each Bid Loan denominated in an Alternate Currency. "ALTERNATE CURRENCY EQUIVALENT": on any date of determination thereof, the amount, as determined by the Administrative Agent, of the relevant Alternate Currency which could be purchased with the amount of Dollars involved in such computation at the spot rate at which such Alternate Currency may be exchanged into Dollars as set forth on such date on Dow Jones Telerate pages 262, 264, 265, 266 or 9993 (or any successor 33

pages) or, if such rate does not appear on such pages, at the arithmetic mean of the respective spot exchange rates therefor notified to the Administrative Agent by BNY as of 11:00 a.m. (London time) on such date for delivery, (i) in the case of an exchange of Canadian Dollars into Dollars, one Core Currency Business Day later, and (ii) in all other cases, two Core Currency Business Days later. "ALTERNATE CURRENCY LOAN": an Alternate Currency Revolving Credit Loan or an Alternate Currency Bid Loan, as the case may be. "ALTERNATE CURRENCY REVOLVING CREDIT LOAN": each Revolving Credit Loan denominated in Alternate Currency. "APPLICABLE MARGIN": (i) Subject to clause (ii) of this definition, (a) with respect to the Eurodollar Advances, Core Currency Euro Advances, and the Standby Letter of Credit Commissions, at all times during which the applicable Pricing Level set forth below is in effect, the percentage set forth below under the heading "Applicable Eurodollar, Core Currency Euro and Standby LC Margin" and adjacent to such Pricing Level, and (b) with respect to the Facility Fee and Trade Letter of Credit Commissions, at all times during which the applicable Pricing Level set forth below is in effect, the percentage set forth below under the heading "Applicable Fee and Trade LC Margin" and adjacent to such Pricing Level: Applicable Eurodollar, Applicable Core Currency Fee and Euro and Trade LC PRICING LEVEL STANDBY LC MARGIN MARGIN ------------- ----------------- ------ Pricing Level I 0.175% 0.075% Pricing Level II 0.200% 0.100% Pricing Level III 0.275% 0.100% (ii) Changes in the Applicable Margin resulting from a change in a Pricing Level shall be based upon the Compliance Certificate most recently delivered pursuant to Section 7.1(a) and shall become effective on the date such Compliance Certificate is delivered to the Administrative Agent and the Lenders. Notwithstanding anything to the contrary contained in this definition, (a) if, at any time and from time to time, the Parent Borrower shall be in Default of its obligations under Section 7.1(a), Pricing Level III shall apply until such Default is cured, and (b) during the period commencing on the Effective Date and ending on the date of delivery thereafter of the first Compliance Certificate pursuant to Section 7.1(a), Pricing Level I shall apply. "APPROVED BANK": any bank whose (or whose parent company's) unsecured non-credit supported short-term commercial paper rating from (i) Standard & 34

Poor's is at least A-1, or the equivalent thereof, or (ii) Moody's is at least P-1, or the equivalent thereof. "ASSIGNMENT": as defined in Section 11.6(b). "ASSIGNMENT AND ACCEPTANCE AGREEMENT": an assignment and acceptance agreement executed by an assignor and an assignee, substantially in the form of Exhibit H. "AUSTRALIAN DOLLARS": freely transferable lawful money of Australia. "BID": an offer by a Lender to make a Bid Loan, substantially in the form of Exhibit K. "BID ACCEPT/REJECT LETTER": a notification given by a Borrower or, if such Borrower is a Subsidiary Borrower, the Parent Borrower, on behalf of such Borrower, pursuant to Section 2.4(d), substantially in the form of Exhibit L. "BID INTEREST PERIOD": as to any Bid Loan, the period commencing on the Borrowing Date with respect to such Bid Loan and ending on the date requested in the Bid Request with respect to such Bid Loan, which date shall be neither earlier than seven days, nor later than 180 days, after such Borrowing Date; PROVIDED, HOWEVER, that (i) if any Bid Interest Period would otherwise end on a day which is not a Business Day, such Bid Interest Period shall be extended to the next succeeding Business Day, unless such next succeeding Business Day would be a date on or after the Scheduled Revolving Credit Commitment Termination Date, in which event such Bid Interest Period shall end on the next preceding Business Day, and (ii) no Bid Interest Period shall end after the Scheduled Revolving Credit Commitment Termination Date. Interest shall accrue from and including the first day of a Bid Interest Period to, but excluding, the last day of such Bid Interest Period. "BID LOAN": each loan made pursuant to Section 2.4. "BID RATE": as to any Bid made by a Lender pursuant to Section 2.4(b), the fixed rate of interest offered by such Lender with respect thereto as set forth in such Bid. "BID REQUEST": a request by a Borrower or, if such Borrower is a Subsidiary Borrower, the Parent Borrower, on behalf of such Borrower, for Bids, substantially in the form of Exhibit I. "BNY RATE": a rate of interest per annum equal to the rate of interest publicly announced in New York City by BNY from time to time as its prime commercial lending rate, such rate to be adjusted automatically (without notice) on the effective date of any change in such publicly announced rate. 35

"BORROWER ADDENDUM": an Addendum, duly completed and executed by each of the Parent Borrower and the relevant Subsidiary thereof, substantially in the form of Exhibit B-1. "BORROWERS": collectively, the Parent Borrower and the Subsidiary Borrowers. "BORROWING DATE": (i) any Business Day on which (a) the Lenders make ABR Advances, (b) a Lender makes a Bid Loan, (c) the Swing Line Lender makes a Swing Line Loan, or (d) the Issuing Bank issues a Letter of Credit, as the case may be, or (ii) any Core Currency Business Day on which the Lenders make Eurodollar Advances or Core Currency Euro Advances, as the case may be. "BORROWING REQUEST": a request for Revolving Credit Loans or a Swing Line Loan, substantially in the form of Exhibit C-1. "BRAZILIAN REALS": freely transferable lawful money of Brazil. "BUSINESS DAY": any day except Saturday, Sunday or a day which in New York City is a legal holiday or a day on which banking institutions are authorized or required by law or other government action to close. "CANADIAN DOLLARS": freely transferable lawful money of Canada. "CAPITAL LEASE": a lease the obligations in respect of which are required to be capitalized by the lessee thereunder for financial reporting purposes in accordance with GAAP. "CAPITAL STOCK": as to any Person, all shares, interests, partnership interests, limited liability company interests, participations and other rights in, or other equivalents (however designated) of, such Person's equity (however designated), and any rights, warrants or options exchangeable for, or convertible into, such shares, interests, participations, rights or other equivalents. "CASH EQUIVALENTS": (i) securities issued or directly and fully guaranteed or insured by the United States or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in full support thereof), in each case having a maturity of not more than six months from the date of acquisition thereof, (ii) Dollar denominated time deposits, certificates of deposit and bankers acceptances of any Lender or any Approved Bank, in each case having a maturity of not more than six months from the date of acquisition thereof, (iii) commercial paper (a) issued by any Approved Bank or the parent company of any Approved Bank, (b) issued or directly and fully guaranteed or insured by any industrial or financial company with an unsecured non-credit supported short-term commercial paper rating of at least A-1, or the equivalent thereof, by Standard & Poor's or at least P-1, or the equivalent thereof, by Moody's, or 36

(c) directly and fully guaranteed or insured by any industrial or financial company with a long term unsecured non-credit supported senior debt rating of at least A or A-2, or the equivalent thereof, by Standard & Poor's or Moody's, as the case may be, in each case having a maturity of not more than six months from the date of acquisition thereof, (iv) marketable direct obligations issued by any State of the United States or any political subdivision or public instrumentality of any such State, in each case having a maturity of not more than six months from the date of acquisition thereof and, at the time of such acquisition, having one of the two highest ratings obtainable from either Standard & Poor's or Moody's, and (v) investments in money market funds substantially all the assets of which are comprised of securities of the types described in clauses (i) through (iv) of this definition. "CHANGE OF CONTROL": one or both of the following events: (a) any person or group (other than any one or more permitted investors) shall have become the beneficial owner of voting shares entitled to exercise more than 30% of the total power of all outstanding voting shares (including any voting shares which are not then outstanding of which such person or group is deemed the beneficial owner); and (b) a change in the composition of the Managing Person of the Parent Borrower shall have occurred in which the individuals who constituted the Managing Person of the Parent Borrower at the beginning of the two year period immediately preceding such change (together with any other director whose election by the Managing Person of the Parent Borrower or whose nomination for election by the shareholders of the Parent Borrower was approved by a vote of at least a majority of the members of such Managing Person then in office who either were members of such Managing Person at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the members of such Managing Person then in office. For purposes of this definition, (i) the terms "PERSON" and "GROUP" shall have the respective meanings ascribed thereto in Sections 13(d) and 14(d)(2) of the Exchange Act, (ii) the term "BENEFICIAL OWNER" shall have the meaning ascribed thereto in Rule 13d-3 under the Exchange Act, (iii) the term "PERMITTED INVESTORS" shall mean any one or more of the following: (A) Robert B. Daugherty, (B) any of his immediate family members, (C) any of his heirs or beneficiaries, (D) any tax-exempt entity established by him, (E) any key employee of the Parent Borrower which shall have acquired voting shares from him, and (F) any employee stock ownership plan sponsored by or otherwise established by the Parent Borrower, and (iv) the term "VOTING SHARES" shall mean outstanding shares of any class or classes (however designated) of Capital Stock of the Parent Borrower entitled to vote generally in the election of members of the Managing Person thereof. 37

"CODE": the Internal Revenue Code of 1986, as the same may be amended from time to time, or any successor thereto, and the rules and regulations issued thereunder, as from time to time in effect. "COMMITMENT PERCENTAGE": with respect to any Lender as of any date, the percentage as of such date equal to such Lender's Revolving Credit Commitment Amount divided by the Aggregate Revolving Credit Commitment Amount (or, if no Revolving Credit Commitments then exist, the percentage equal to such Lender's Revolving Credit Commitment Amount on the last day upon which Revolving Credit Commitments did exist divided by the Aggregate Revolving Credit Commitment Amount as in effect on such day). "COMPLIANCE CERTIFICATE": a certificate substantially in the form of Exhibit E. "CONSOLIDATED": the Parent Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP. "CONSOLIDATED EBITDA": for any period, net income of the Parent Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP, for such period, PLUS the sum of, without duplication, each of the following with respect to the Parent Borrower and its Subsidiaries, to the extent utilized in determining such net income: (i) all interest expense, (ii) provision for income taxes, and (iii) depreciation and amortization, PROVIDED, HOWEVER, that, for purposes of this definition, the 1996 pre-tax asset valuation charge in the amount of $15,800,000 referred to in the Parent Borrower's Form 10K for the fiscal year ending December 28, 1996 shall be excluded to the extent utilized in determining such net income. "CONSOLIDATED DEBT SERVICE": for any period, the sum of (i) interest expense for such period of the Parent Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP, and (ii) all repayments of Indebtedness (including Indebtedness under the Loan Documents) of the Parent Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP, which were required to be made during such period. "CONSOLIDATED FIXED CHARGES": for any period, the sum of, without duplication, (i) Consolidated Debt Service for such period, (ii) all income taxes payable during such period by the Parent Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP, and (iii) all Restricted Payments made pursuant to Section 8.7(ii) in cash during such period by the Parent Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP. "CONSOLIDATED TANGIBLE NET WORTH": as of any date, the total stockholders' equity of the Parent Borrower and its Subsidiaries, less intangible assets, all determined on a Consolidated basis in accordance with GAAP, as set forth in, (i) during the period 38

commencing on the Effective Date and ending on the date of delivery thereafter of the first annual audited financial statements pursuant to Section 7.1(b), the Parent Borrower's December 28, 1996 audited Consolidated financial statements constituting a part of the Financial Statements, and (ii) at all other times, the most recent annual audited Consolidated financial statements delivered pursuant to Section 7.1(b). "CONTINGENT OBLIGATION": as to any Person ( a "SECONDARY OBLIGOR"), any obligation of such secondary obligor (i) guaranteeing or in effect guaranteeing any return on any investment made by another Person, or (ii) guaranteeing or in effect guaranteeing any Indebtedness, lease, dividend or other obligation (a "PRIMARY OBLIGATION") of any other Person (a "PRIMARY OBLIGOR") in any manner, whether directly or indirectly, including any obligation of such secondary obligor, whether contingent, (a) to purchase any primary obligation or any Property constituting direct or indirect security therefor, (b) to advance or supply funds (A) for the purchase or payment of any primary obligation or (B) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of a primary obligor, (c) to purchase Property, securities or services primarily for the purpose of assuring the beneficiary of any primary obligation of the ability of a primary obligor to make payment of a primary obligation, (d) otherwise to assure or hold harmless the beneficiary of a primary obligation against loss in respect thereof, and (e) in respect of the liabilities of any partnership in which a secondary obligor is a general partner, except to the extent that such liabilities of such partnership are nonrecourse to such secondary obligor and its separate Property, PROVIDED, HOWEVER, that the term "CONTINGENT OBLIGATION" shall not include the indorsement of instruments for deposit or collection in the ordinary course of business. The amount of any Contingent Obligation of a Person shall be deemed to be an amount equal to the stated or determinable amount of a primary obligation in respect of which such Contingent Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by such Person in good faith. "CONTROL PERSON": as defined in Section 3.5. "CONVERSION DATE": any date on which (i) a Eurodollar Advance is converted to an ABR Advance or a new Eurodollar Advance, as the case may be, (ii) an ABR Advance is converted to a Eurodollar Advance or (iii) a Core Currency Euro Advance is converted to a new Core Currency Euro Advance, as the case may be. "CORE CURRENCY": any Currency other than a Non-Core Currency. "CORE CURRENCY BUSINESS DAY": with respect to any Currency, any Business Day which is a day on which dealings in eurocurrencies and exchange between banks may be carried on in London, England and which is not a legal holiday or a day on which banking institutions are authorized or required by law or other government action to close in the national jurisdiction in which the Agent Payment Office with respect to 39

such Currency is located or, if there is no such Agent Payment Office, the national jurisdiction of which such Currency is the freely transferable lawful money. "CORE CURRENCY EURO ADVANCES": the Revolving Credit Loans (or any portions thereof) at such time as they (or such portions) are made and/or being maintained in a Core Currency (other than Dollars) at a rate of interest based upon the applicable Core Currency Euro Rate. "CORE CURRENCY EURO RATE": with respect to each Core Currency Euro Advance, a rate of interest per annum, as determined by the Administrative Agent, obtained by dividing (and then rounding to the nearest 1/16 of 1% or, if there is no nearest 1/16 of 1%, then to the next higher 1/16 of 1%): (a) (i) the rate per annum for deposits in the applicable Core Currency having a maturity most nearly comparable to the Euro Interest Period in respect of such Core Currency Euro Advance which appears on page 3740 or 3750, or any other applicable page with respect to such Core Currency, of the Dow Jones Telerate Screen (or any successor page) as of 11:00 a.m. London time on the date which is two Core Currency Business Days prior to the first day of such Euro Interest Period, (ii) if such rate does not appear on such page of the Dow Jones Telerate Screen (or any successor page), the rate, as reported by BNY to the Administrative Agent, quoted by BNY at approximately 11:00 a.m. London time (or as soon thereafter as practicable) on the date which is two Core Currency Business Days prior to the first day of such Euro Interest Period to leading banks in the interbank eurocurrency market as the rate at which BNY is offering deposits in such Core Currency in an amount approximately equal to BNY's Commitment Percentage of such Core Currency Euro Advance and having a period to maturity approximately equal to such Euro Interest Period, or (iii) to the extent required by Section 3.8, the rate, as reported by BNY to the Administrative Agent, determined by BNY to be reflective of the all-in cost of funds to BNY of funding such Core Currency Euro Advance in an amount approximately equal to its Commitment Percentage of such Core Currency Euro Advance and having a period to maturity approximately equal to such Euro Interest Period, by (b) a number equal to 1.00 MINUS the aggregate of the then stated maximum rates during such Euro Interest Period of all reserve requirements (including marginal, emergency, supplemental and special reserves), expressed as a decimal, established by any Governmental Authority, including those established by the Board of Governors of the Federal Reserve System and any other banking authority to which BNY and other major United States money center banks are subject in respect of eurocurrency funding (currently referred to as "EUROCURRENCY LIABILITIES" in Regulation D), without benefit of credits for 40

proration, exceptions or offsets which may be available from time to time to BNY. "CREDIT PARTY": each Borrower and each other party (other than the Administrative Agent, the Issuing Bank, the Swing Line Lender, and the Lenders) to a Loan Document. "CURRENCIES": collectively, Dollars, Dutch Guilders, French Francs, German Marks, and the Non-Core Currencies. "CURRENCY ADDENDUM": an Addendum, duly completed and executed by the Parent Borrower, substantially in the form of Exhibit B-2. "DEFAULT": any event or condition which constitutes an Event of Default or which, with the giving of notice, the lapse of time, or any other condition, would, unless cured or waived, become an Event of Default. "DISPOSITION": with respect to any Person, any sale, assignment, transfer or other disposition by such Person, by any means, of (i) the Capital Stock of any other Person, (ii) any business, going concern or division or segment thereof, or (iii) any other Property of such Person other than in the ordinary course of business, PROVIDED, HOWEVER, that no such sale, assignment, transfer or other disposition of Property (other than inventory, except to the extent subject to a bulk sale) shall be deemed to be in the ordinary course of business if it is the sale, assignment, transfer or disposition of (a) all or substantially all of the Property of such Person, or (b) any Operating Entity. "DOLLAR BID LOAN": each Bid Loan denominated in Dollars. "DOLLAR EQUIVALENT": on any date of determination thereof, the amount, as determined by the Administrative Agent, of Dollars which could be purchased with the amount of the relevant Alternate Currency involved in such computation at the spot rate at which Dollars may be exchanged into such Alternate Currency as set forth on such date on Dow Jones Telerate pages 262, 264, 265, 266 or 9993 (or any successor pages) or, if such rate does not appear on such pages, at the spot exchange rate therefor notified to the Administrative Agent by BNY as of 11:00 a.m. (London time) on such date for delivery, (i) in the case of an exchange of Dollars into Canadian Dollars, one Core Currency Business Day later, and (ii) in all other cases, two Core Currency Business Days later. "DOLLAR REVOLVING CREDIT LOAN": as defined in Section 2.1(b)(i). "DOLLARS" and "$": lawful currency of the United States. 41

"DOMESTIC SUBSIDIARY": any direct or indirect wholly-owned Subsidiary of the Parent Borrower which is organized under the laws of the United States or any State thereof. "DUTCH BORROWER": any Borrower which is organized under the laws of, and has its principal office in, the Netherlands. "DUTCH GUILDERS": freely transferable lawful money of the Netherlands. "EFFECTIVE DATE": October 7, 1997. "ELIGIBLE ASSIGNEE": (i) at all times upon the occurrence and during the continuance of any Default, any commercial bank, trust company, banking association, insurance company, financial institution, pension fund, mutual fund or other similar fund, and (ii) at all other times, any commercial bank, trust company or banking association having undivided capital surplus and retained earnings exceeding $100,000,000, PROVIDED, HOWEVER, that, for purposes of this definition, "Eligible Assignee" shall not include any Lender or any subsidiary or affiliate thereof. "EMPLOYEE BENEFIT PLAN": an employee benefit plan within the meaning of Section 3(3) of ERISA maintained, sponsored or contributed to by the Parent Borrower, any of its Subsidiaries or any ERISA Affiliate. "ERISA": the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations issued thereunder, as from time to time in effect. "ERISA AFFILIATE": when used with respect to an Employee Benefit Plan, ERISA, the PBGC or a provision of the Code pertaining to employee benefit plans, any Person which is a member of any group of organizations within the meaning of Sections 414(b) or (c) of the Code (or, solely for purposes of potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11) of the Code and the lien created under Section 302(f) of ERISA and Section 412(n) of the Code, Sections 414(m) or (o) of the Code) of which the Parent Borrower or any of its Subsidiaries is a member. "EURO INTEREST PERIOD": with respect to any Eurodollar Advance or Core Currency Euro Advance, as the case may be, requested by any Borrower or, if such Borrower is a Subsidiary Borrower, the Parent Borrower, on behalf of such Borrower, the period commencing on the Borrowing Date or Conversion Date, as the case may be, with respect to such Advance and ending one, two, three or six months thereafter, as selected by such Borrower or, if such Borrower is a Subsidiary Borrower, the Parent Borrower, on behalf of such Borrower, in the applicable Borrowing Request or Notice of Conversion, as the case may be, therefor, PROVIDED, HOWEVER, that (i) if any Euro Interest Period would otherwise end on a day which is not a Core Currency Business Day, such Euro Interest Period shall be extended to the next succeeding Core Currency Business Day unless (a) 42

such next succeeding Core Currency Business Day would be a date on or after the Scheduled Revolving Credit Commitment Termination Date, in which event such Euro Interest Period shall end on the next preceding Core Currency Business Day, or (b) the result of such extension would be to carry such Euro Interest Period into another calendar month, in which event such Euro Interest Period shall end on the immediately preceding Core Currency Business Day, (ii) any Euro Interest Period that begins on the last Core Currency Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Euro Interest Period) shall end on the last Core Currency Business Day of a calendar month, and (iii) no Euro Interest Period shall end after the Scheduled Revolving Credit Commitment Termination Date. Interest shall accrue from and including the first day of a Euro Interest Period to, but excluding, the last day of such Euro Interest Period. "EURODOLLAR ADVANCES": the Revolving Credit Loans (or any portions thereof), at such time as they (or such portions) are made and/or being maintained at a rate of interest based upon the Eurodollar Rate. "EURODOLLAR RATE": with respect to each Eurodollar Advance, a rate of interest per annum, as determined by the Administrative Agent, obtained by dividing (and then rounding to the nearest 1/16 of 1% or, if there is no nearest 1/16 of 1%, then to the next higher 1/16 of 1%): (a) (i) the rate per annum for deposits in Dollars having a maturity most nearly comparable to the Euro Interest Period in respect of such Eurodollar Advance which appears on page 3750 of the Dow Jones Telerate Screen (or any successor page) as of 11:00 a.m. London time on the date that is two Core Currency Business Days prior to the first day of such Euro Interest Period, or (ii) if such rate does not appear on page 3750 of the Dow Jones Telerate Screen (or any successor page), the rate, as reported by BNY to the Administrative Agent, quoted by BNY at approximately 11:00 a.m. London time (or as soon thereafter as practicable) on the date which is two Core Currency Business Days prior to the first day of such Euro Interest Period to leading banks in the interbank eurocurrency market as the rate at which BNY is offering Dollar deposits in an amount approximately equal to BNY's Commitment Percentage of such Eurodollar Advance and having a period to maturity approximately equal to such Euro Interest Period, by (b) a number equal to 1.00 MINUS the aggregate of the then stated maximum rates during such Euro Interest Period of all reserve requirements (including marginal, emergency, supplemental and special reserves), expressed as a decimal, established by the Board of Governors of the Federal Reserve System and any other banking authority to which BNY and other major United States money center banks are subject in respect of eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in Regulation D), without benefit of 43

credits for proration, exceptions or offsets which may be available from time to time to BNY. "EVENT OF DEFAULT": as defined in Section 9.1. "EXCHANGE ACT": the Securities Exchange Act of 1934, as amended. "FACILITY FEE": as defined in Section 3.2(a). "FEDERAL FUNDS RATE": for any day, a rate per annum (expressed as a decimal, rounded upwards, if necessary, to the next higher 1/100 of 1%) equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day, provided that, (i) if the day for which such rate is to be determined is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (ii) if such rate is not so published for any day, the Federal Funds Rate for such day shall be the average of the quotations for such day on such transactions received by the Administrative Agent. "FEES": as defined in Section 2.11. "FINANCIAL OFFICER": as to any Person, the chief financial officer of such Person, or such other officer as shall be satisfactory to the Administrative Agent. "FINANCIAL STATEMENTS": as defined in Section 4.13. "FIXED CHARGE COVERAGE RATIO": as of any date, the ratio of (i) Consolidated EBITDA to (ii) Consolidated Fixed Charges, in each case for the four fiscal quarter period ending on such date or, if such date is not the last day of a fiscal quarter, the immediately preceding four fiscal quarter period. "FIXED RATE LOAN": any Eurodollar Advance, Core Currency Euro Advance, Bid Loan or Swing Line Loan, as the case may be. "FRENCH BORROWER": any Borrower which is organized under the laws of, and has its principal office in, France. "FRENCH FRANCS": freely transferable lawful money of France. "GAAP": generally accepted accounting principles as in effect from time to time in the United States. "GERMAN BORROWER": any Borrower which is organized under the laws of, and has its principal office in, Germany. 44

"GERMAN MARKS": freely transferable lawful money of Germany. "GOVERNMENTAL AUTHORITY": any foreign, federal, state, municipal or other government, or any department, commission, board, bureau, agency, public authority or instrumentality thereof, or any court or arbitrator. "GUARANTOR": as defined in the Subsidiary Guaranty. "INACTIVE SUBSIDIARY BORROWER": at any time, any Subsidiary Borrower which has no Subsidiary Borrower Obligations. "INDEBTEDNESS": as to any Person, at a particular time, all items which constitute, without duplication, (i) indebtedness for borrowed money, (ii) indebtedness in respect of the deferred purchase price of Property (other than trade payables incurred in the ordinary course of business), (iii) indebtedness evidenced by notes, bonds, debentures or similar instruments, (iv) obligations with respect to any conditional sale or title retention agreement, (v) indebtedness arising under acceptance facilities and the amount available to be drawn under all letters of credit issued for the account of such Person (other than letters of credit issued in support of trade payables incurred in the ordinary course of business) and, without duplication, all drafts drawn thereunder to the extent such Person shall not have reimbursed the issuer in respect of the issuer's payment thereof, (vi) all liabilities secured by any Lien on any Property owned by such Person even though such Person has not assumed or otherwise become liable for the payment thereof (other than carriers', warehousemen's, mechanics', repairmen's or other like non-consensual statutory Liens arising in the ordinary course of business), (vii) obligations under Capital Leases, and (viii) all Contingent Obligations of such Person in respect of any of the foregoing. "INDEMNIFIED LIABILITIES": as defined in Section 11.5. "INDEMNIFIED PERSON": as defined in Section 11.7. "INDEMNIFIED TAX": as to any Person, any Tax, except (i) a Tax on the Income imposed on such Person and (ii) any interest, fees or penalties for late payment imposed on such Person, in each case to the extent not attributable to the failure of the Parent Borrower or any of its Subsidiaries to obtain any necessary approvals or consents of, or file or cause to be filed any reports, applications, documents, instruments or information required to be filed pursuant to any applicable law, rule, regulation or request of, any Governmental Authority. "INDEMNIFIED TAX PERSON": the Administrative Agent, the Issuing Bank, the Swing Line Lender, or any Lender, as the case may be. "INTEREST PAYMENT DATE": (i) as to any ABR Advance, the last day of each March, June, September and December commencing on the first of such days to occur 45

after such ABR Advance is made or any Eurodollar Advance is converted to an ABR Advance, (ii) as to any Swing Line Loan, the date on which the outstanding principal amount of such Swing Line Loan shall become due and payable in accordance with Section 2.2, (iii) as to any Eurodollar Advance or Core Currency Euro Advance, as the case may be, as to which the applicable Borrower has selected a Euro Interest Period of one, two or three months, or any Bid Loan in respect of which the Bid Interest Period applicable thereto is less than or equal to 90 days, the last day of such Euro Interest Period or such Bid Interest Period, as the case may be, (iv) as to any Eurodollar Advance or Core Currency Euro Advance, as the case may be, as to which the applicable Borrower has selected a Euro Interest Period of six months, or any Bid Loan in respect of which the Bid Interest Period applicable thereto is greater than 90 days, the last day of each three month or 90 day, as the case may be, interval occurring during such Euro Interest Period or such Bid Interest Period, as the case may be, and the last day of such Euro Interest Period or such Bid Interest Period, as the case may be, and (v) as to any all Advances and all Bid Loans, the Revolving Credit Maturity Date, and (vi) as to all Swing Line Loans, the Swing Line Maturity Date. "INVESTMENTS": as defined in Section 8.6. "INVITATION TO BID": an invitation to make Bids in the form of Exhibit J. "JUDGMENT CURRENCY": as defined in Section 11.14. "JUDGMENT CURRENCY CONVERSION DATE": as defined in Section 11.14. "LETTER OF CREDIT": as defined in Section 2.8. "LETTER OF CREDIT COMMISSIONS": as defined in Section 3.2(b). "LETTER OF CREDIT COMMITMENT": the commitment of the Issuing Bank to issue Letters of Credit having an aggregate outstanding face amount up to the Letter of Credit Commitment Amount, and the commitment of the Lenders to participate in the Letter of Credit Exposure as set forth in Section 2.10. "LETTER OF CREDIT COMMITMENT AMOUNT": $30,000,000. "LETTER OF CREDIT EXPOSURE": as of any date and in respect of any Lender, an amount equal to (i) the sum as of such date, without duplication, of (a) the aggregate undrawn face amount of all outstanding Letters of Credit, (b) the aggregate amount of unpaid drafts drawn on all Letters of Credit, and (c) the aggregate unpaid Reimbursement Obligations (after giving effect to any Revolving Credit Loans made on such date to pay any such Reimbursement Obligations), MULTIPLIED BY (ii) such Lender's Commitment Percentage. "LETTER OF CREDIT REQUEST": a request in the form of Exhibit C-2. 46

"LEVERAGE RATIO": as of any date, the ratio of (i) the aggregate Indebtedness as of such date of the Parent Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP, to (ii) Consolidated EBITDA for the four fiscal quarter period ending on such date or, if such date is not the last day of a fiscal quarter, for the immediately preceding four fiscal quarter period. "LIEN": any mortgage, pledge, hypothecation, assignment, deposit or preferential arrangement, encumbrance, lien (statutory or other), or other security agreement or security interest of any kind or nature whatsoever, including any conditional sale or other title retention agreement and any capital or financing lease having substantially the same economic effect as any of the foregoing. "LOAN": a Revolving Credit Loan, Bid Loan, or Swing Line Loan, as the case may be. "LOAN DOCUMENTS": collectively, this Agreement, the Subsidiary Guaranty, the Reimbursement Agreements, and all agreements, instruments and other documents executed or delivered in connection with any of the foregoing, including any promissory notes executed and delivered pursuant to Section 2.13, in each case as amended, supplemented or otherwise modified from time to time. "LOANS": the Revolving Credit Loans, the Bid Loans and/or the Swing Line Loans, as the case may be. "MANAGING PERSON": with respect to any Person that is (i) a corporation, its board of directors, (ii) a limited liability company, its board of control or managing member or members, (iii) a limited partnership, its general partner, (iv) a general partnership or a limited liability partnership, its managing partner or executive committee, or (v) any other Person, the managing body thereof or other Person analogous to the foregoing. "MARGIN STOCK": any "margin stock", as defined in Regulation U of the Board of Governors of the Federal Reserve System, as amended, supplemented or otherwise modified from time to time. "MATERIAL ADVERSE CHANGE": a material adverse change in (i) the condition (financial or otherwise), operations, business or Property of the Parent Borrower and its Subsidiaries, taken as a whole, (ii) the ability of the Parent Borrower or any of its Subsidiaries to perform its obligations under any Loan Document, or (iii) the ability of the Administrative Agent, the Issuing Bank, the Swing Line Lender or any Lender to enforce any Loan Document. "MATERIAL ADVERSE EFFECT": a material adverse effect on (i) the condition (financial or otherwise), operations, business or Property of the Parent Borrower and its Subsidiaries, taken as a whole, (ii) the ability of the Parent Borrower or any of its 47

Subsidiaries to perform its obligations under any Loan Document, or (iii) the ability of the Administrative Agent, the Issuing Bank, the Swing Line Lender or any Lender to enforce any Loan Document. "MATERIAL SUBSIDIARY": at any time, each Domestic Subsidiary which has at such time assets or net sales greater than or equal to 5% of the aggregate assets or net sales of the Parent Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP. "MOODY'S": Moody's Investors Service, Inc., or any successor thereto. "MULTIEMPLOYER PLAN": a Pension Plan which is a multiemployer plan as defined in Section 4001(a)(3) of ERISA. "NEGOTIATED RATE": with respect to each Swing Line Loan, the rate per annum equal to, (i) at all times during the period, if any, commencing on the date of delivery of a notice of an Event of Default by the Administrative Agent to the Lenders under Section 2.2(c) with respect to such Swing Line Loan and terminating on the date on which such Event of Default shall no longer be continuing, the Alternate Base Rate, and (ii) at all other times, the rate agreed to by the Parent Borrower and the Swing Line Lender in accordance with Section 2.2 as the interest rate that such Swing Line Loan shall bear. "NON-CORE CURRENCIES": collectively, Australian Dollars, Brazilian Reals, Canadian Dollars, and Sterling Pounds, and such other currencies as shall become Non-Core Currencies in accordance with Section 2.12(b). "NOTICE OF CONVERSION": a notice substantially in the form of Exhibit D. "OBLIGATION CURRENCY": as defined in Section 11.14. "OPERATING ENTITY": any Person or any business or operating unit of a Person which is, or could be, operated separate and apart from (i) the other businesses and operations of such Person, or (ii) any other line of business or business segment. "ORGANIZATIONAL DOCUMENTS": as to any Person which is (i) a corporation, the certificate or articles of incorporation and by-laws of such Person, (ii) a limited liability company, the limited liability company agreement or similar agreement of such Person, (iii) a partnership, the partnership agreement or similar agreement of such Person, or (iv) any other form of entity or organization, the organizational documents analogous to the foregoing. "OTHER INTERCOMPANY ACQUISITION": an Acquisition by the Parent Borrower or any Subsidiary thereof from the Parent Borrower or any such Subsidiary, PROVIDED, 48

HOWEVER, that, for purposes hereof, "Other Intercompany Acquisition" shall not include any Unrestricted Intercompany Acquisition. "OTHER INTERCOMPANY BASKET AMOUNT": at any time, an amount equal to the sum of, without duplication, (i) the aggregate outstanding principal amount of all Other Intercompany Indebtedness at such time, PLUS (ii) the aggregate consideration paid as of such time for all Other Intercompany Investments made under Section 8.6(g) on and after the date hereof, PLUS (iii) the aggregate amount as of such time of all Other Intercompany Restricted Payments made on or after the date hereof. "OTHER INTERCOMPANY DISPOSITION": a Disposition by the Parent Borrower or any Subsidiary thereof to the Parent Borrower or any such Subsidiary, PROVIDED, HOWEVER, that, for purposes hereof, "Other Intercompany Disposition" shall not include any Unrestricted Intercompany Disposition. "OTHER INTERCOMPANY INDEBTEDNESS": Indebtedness of the Parent Borrower or any Subsidiary thereof to the Parent Borrower or any such Subsidiary, PROVIDED, HOWEVER, that, for purposes hereof, "Other Intercompany Indebtedness" shall not include any Unrestricted Intercompany Indebtedness. "OTHER INTERCOMPANY INVESTMENT": an Investment by the Parent Borrower or any Subsidiary thereof in the Parent Borrower or any such Subsidiary, PROVIDED, HOWEVER, that, for purposes hereof, "Other Intercompany Investment" shall not include any Unrestricted Intercompany Investment. "OTHER INTERCOMPANY RESTRICTED PAYMENT": a Restricted Payment made by any Subsidiary of the Parent Borrower to the Parent Borrower or any such Subsidiary, to the extent received by the Parent Borrower or such Subsidiary, as the case may be, PROVIDED, HOWEVER, that, for purposes hereof, "Other Intercompany Restricted Payment" shall not include any Unrestricted Intercompany Payment. "OUTSTANDING PERCENTAGE": as of any date and with respect to the Issuing Bank, the Swing Line Lender or any Lender, as the case may be, a fraction the numerator of which is the Outstandings on such date of the Issuing Bank, the Swing Line Lender or such Lender, as applicable, and the denominator of which is the aggregate Outstandings on such date of the Issuing Bank, the Swing Line Lender and all Lenders. "OUTSTANDINGS": with respect to the Issuing Bank, the Swing Line Lender or any Lender, as the case may be, as of any date, an amount equal to (i) the outstanding principal amount on such date of all the Loans (determined, in the case of each Alternate Currency Loan, on the basis of the Dollar Equivalent thereof) of such Lender, PLUS (ii) with respect to the Issuing Bank only, the excess of (a) the aggregate sum of all drafts honored under all Letters of Credit, over (b) all payments made to the Issuing Bank by the Credit Parties and the Lenders in reimbursement thereof or participation therein, as the case may be, PLUS (iii) with respect to the Swing Line Lender only, the excess of (a) 49

the outstanding principal amount on such date of all the Swing Line Loans, over (b) all payments made to the Swing Line Lender by the Credit Parties and the Lenders in repayment thereof or participation therein, as the case may be, PLUS (iv) with respect to each Lender, the excess of (a) the aggregate sum of all payments by such Lender in participation of the Reimbursement Obligations and the Swing Line Loans, over (b) all reimbursements of such Lender in respect thereof. "PBGC": the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA, or any Governmental Authority succeeding to the functions thereof. "PENSION PLAN": at any date of determination, any Employee Benefit Plan (including a Multiemployer Plan), the funding requirements of which (under Section 302 of ERISA or Section 412 of the Code) are, or at any time within the six years immediately preceding such date, were in whole or in part, the responsibility of the Parent Borrower, any of its Subsidiaries or any ERISA Affiliate. "PERMITTED LIEN": a Lien permitted to exist under Section 8.2. "PERSON": any individual, firm, partnership, limited liability company, joint venture, corporation, association, business enterprise, joint stock company, unincorporated association, trust, Governmental Authority or any other entity, whether acting in an individual, fiduciary or other capacity, and for the purpose of the definition of "ERISA Affiliate", a trade or business. "PRICING LEVEL": Pricing Level I, Pricing Level II, or Pricing Level III, as applicable. "PRICING LEVEL I": any time when the Leverage Ratio is less than 1.00:1.00. "PRICING LEVEL II": any time when the Leverage Ratio is greater than or equal to 1.00:1.00 but less than 1.50:1.00. "PRICING LEVEL III": any time when the Leverage Ratio is greater than or equal to 1.50:1.00. "PROHIBITED TRANSACTION": a transaction which is prohibited under Section 4975 of the Code or Section 406 of ERISA and not exempt under Section 4975 of the Code or Section 408 of ERISA. "PROPERTY": all types of real, personal, tangible, intangible or mixed property. "PROPOSED LENDER": as defined in Section 3.12. 50

"REAL PROPERTY": all real property owned or leased by the Parent Borrower or any of its Subsidiaries. "REGULATION D": Regulation D of the Board of Governors of the Federal Reserve System as from time to time in effect and any successor to all or a portion thereof establishing reserve requirements. "REGULATORY CHANGE": (i) the introduction or phasing in of any law, rule or regulation after the Relevant Date, (ii) the issuance or promulgation after the Relevant Date of any directive, guideline or request from any Governmental Authority (whether or not having the force of law), or (iii) any change after the Relevant Date in the interpretation of any existing law, rule, regulation, directive, guideline or request by any Governmental Authority charged with the administration thereof. "REIMBURSEMENT AGREEMENT": as defined in Section 2.8(a). "REIMBURSEMENT OBLIGATION": the obligation of the Parent Borrower to reimburse the Issuing Bank for amounts drawn under a Letter of Credit. "RELEVANT DATE": (i) in the case of each Lender listed on the signature pages hereof, the Effective Date, and (ii) in the case of each other Lender, the effective date of the Assignment and Acceptance Agreement or other document pursuant to which it became a Lender. "REPORTABLE EVENT": with respect to any Pension Plan, (i) any event set forth in Sections 4043(b) (other than a Reportable Event as to which the 30 day notice requirement is waived by the PBGC under applicable regulations), 4062(c) or 4063(a) of ERISA or the regulations thereunder, (ii) an event requiring the Parent Borrower, any of its Subsidiaries or any ERISA Affiliate to provide security to a Pension Plan under Section 401(a)(29) of the Code, or (iii) any failure to make any payment required by Section 412(m) of the Code. "REQUIRED LENDERS": at any time prior to the Revolving Credit Commitment Termination Date, Lenders having Revolving Credit Commitment Amounts greater than or equal to 51% of the Aggregate Revolving Credit Commitment Amount, and, at all other times, the Issuing Bank, the Swing Line Lender and the Lenders having Outstandings greater than or equal to 51% of the aggregate Outstandings of the Issuing Bank, the Swing Line Lender and all Lenders. "REQUIRED PAYMENT": as defined in Section 3.9(a). "RESTRICTED PAYMENT": as to any Person (i) any dividend or other distribution, direct or indirect, on account of any shares of Capital Stock of such Person now or hereafter outstanding (other than a dividend payable solely in shares of such Capital Stock to the holders of such shares) and (ii) any redemption, retirement, sinking 51

fund or similar payment, purchase or other acquisition, direct or indirect, of any shares of any class of Capital Stock of such Person now or hereafter outstanding. "REVOLVING CREDIT COMMITMENT": in respect of any Lender, such Lender's undertaking during the Revolving Credit Commitment Period to make Revolving Credit Loans, subject to the terms and conditions hereof, in an aggregate outstanding principal amount not exceeding the Revolving Credit Commitment Amount of such Lender. "REVOLVING CREDIT COMMITMENT AMOUNT": as of any date and with respect to any Lender, the amount set forth adjacent to its name under the heading "Revolving Credit Commitment Amount" in Exhibit A on such date or, in the event that such Lender is not listed in Exhibit A, the "Revolving Credit Commitment Amount" which such Lender shall have assumed from another Lender in accordance with Section 11.6 on or prior to such date, in each case as the same may be adjusted from time to time pursuant to Sections 2.5 and 11.6. "REVOLVING CREDIT COMMITMENT PERIOD": the period from the Effective Date until the Revolving Credit Commitment Termination Date. "REVOLVING CREDIT COMMITMENT TERMINATION DATE": the earlier of the Business Day immediately preceding the Scheduled Revolving Credit Commitment Termination Date or such other date upon which the Revolving Credit Commitments shall have been terminated in accordance with Section 2.5 or Section 9.2. "REVOLVING CREDIT EXPOSURE": with respect to any Lender as of any date, the sum as of such date of (i) the outstanding principal amount of such Lender's Revolving Credit Loans (determined, in the case of each Alternate Currency Loan, on the basis of the Dollar Equivalent thereof), (ii) such Lender's Swing Line Exposure, and (iii) such Lender's Letter of Credit Exposure. "REVOLVING CREDIT LOAN" and "REVOLVING CREDIT LOANS": as defined in Section 2.1. "REVOLVING CREDIT MATURITY DATE": the Scheduled Revolving Credit Commitment Termination Date, or such earlier date on which the Revolving Credit Loans shall become due and payable, whether by acceleration or otherwise. "SCHEDULED REVOLVING CREDIT COMMITMENT TERMINATION DATE": June 30, 2002. "SCHEDULED SWING LINE COMMITMENT TERMINATION DATE": the fifth Business Day preceding the Scheduled Revolving Credit Commitment Termination Date. "SEC": the Securities and Exchange Commission or any Governmental Authority succeeding to the functions thereof. 52

"SPECIAL COUNSEL": Emmet, Marvin & Martin, LLP, special counsel to the Administrative Agent. "STANDARD & POOR'S": Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc., or any successor thereto. "STANDBY LETTERS OF CREDIT": as defined in Section 2.8(a). "STERLING POUNDS": freely transferable lawful money of the United Kingdom. "SUBSIDIARY": as to any Person, any corporation, association, partnership, limited liability company, joint venture or other business entity of which such Person or any Subsidiary of such Person, directly or indirectly, either (i) in respect of a corporation, owns or controls more than 50% of the outstanding Capital Stock having ordinary voting power to elect a majority of the managing Person thereof, irrespective of whether a class or classes shall or might have voting power by reason of the happening of any contingency, or (ii) in respect of an association, partnership, limited liability company, joint venture or other business entity, is entitled to share in more than 50% of the profits and losses thereof, however determined. "SUBSIDIARY BORROWER OBLIGATIONS": at any time, in respect of any Subsidiary Borrower, the principal amount outstanding at such time of the Loans made to such Subsidiary Borrower (determined on the basis of the Dollar Equivalent thereof), together with all accrued interest thereon and all other sums due and owing at such time from such Subsidiary Borrower under the Loan Documents. "SUBSIDIARY GUARANTY": as defined in Section 5.4. "SWING LINE COMMITMENT": the undertaking of the Swing Line Lender during the Swing Line Commitment Period to make Swing Line Loans, subject to the terms and conditions hereof, in an aggregate outstanding principal amount not in excess of the Swing Line Commitment Amount, and the commitment of the Lenders to participate therein as set forth in Section 2.2, as the same may be adjusted from time to time pursuant to Sections 2.5 and 11.6. "SWING LINE COMMITMENT AMOUNT": $5,000,000. "SWING LINE COMMITMENT PERIOD": the period from the Effective Date until the Swing Line Commitment Termination Date. "SWING LINE COMMITMENT TERMINATION DATE": the earlier of the Business Day immediately preceding the Scheduled Swing Line Commitment Termination Date or such other date upon which the Swing Line Commitment shall have been terminated in accordance with Section 2.5 or Section 9.2. 53

"SWING LINE EXPOSURE": at any time, in respect of any Lender, an amount equal to the aggregate outstanding principal amount of the Swing Line Loans at such time, MULTIPLIED BY such Lender's Commitment Percentage at such time. "SWING LINE INTEREST PERIOD": with respect to any Swing Line Loan requested by the Parent Borrower, the period commencing on the Borrowing Date with respect to such Swing Line Loan and ending not in excess of five days thereafter, as selected by the Parent Borrower in the applicable Borrowing Request therefor, PROVIDED, HOWEVER, that (i) if any Swing Line Interest Period would otherwise end on a day that is not a Business Day, such Swing Line Interest Period shall be extended to the next succeeding Business Day, unless such next succeeding Business Day would be a date on or after the Scheduled Swing Line Commitment Termination Date, in which event such Euro Interest Period shall end on the next preceding Business Day, and (ii) no Swing Line Interest Period shall end after the Scheduled Swing Line Commitment Termination Date. Interest shall accrue from and including the first day of a Swing Line Interest Period to, but excluding, the last day of such Swing Line Interest Period. "SWING LINE LOAN" and "SWING LINE LOANS": as defined in Section 2.2(a). "SWING LINE MATURITY DATE": the Scheduled Swing Line Commitment Termination Date, or such earlier date on which the Swing Line Loans shall become due and payable, whether by acceleration or otherwise. "SWING LINE PARTICIPATION AMOUNT": as defined in Section 2.2(c). "SYNTHETIC LEASE ARRANGEMENT": the synthetic lease arrangement by and among the Borrower, Wachovia Capital Markets, Inc. and Wachovia Bank, N.A., as Agent, relating to the office building/headquarters project located in Omaha, Nebraska. "TAX": any present or future tax, levy, impost, duty, charge, fee, deduction or withholding of any nature and whatever called, by a Governmental Authority, on whomsoever and wherever imposed, levied, collected, withheld or assessed. "TAX ON THE INCOME": as to any Person, a Tax imposed by one of the following jurisdictions or by any political subdivision or taxing authority thereof: (i) the United States, (ii) the jurisdiction in which such Person is organized, (iii) the jurisdiction in which such Person's principal office is located, or (iv) in the case of each Lender, any jurisdiction in which such Person is deemed to be doing business; which Tax is an income tax (or any tax in lieu thereof or equivalent thereto) or franchise tax imposed on all or part of the net income or net profits of such Person or with respect to the net increase in the shareholders' or owners' equity or capital in such Person or which Tax represents interest, fees or penalties for payment of any such income tax or franchise tax. "TERMINATION EVENT": with respect to any Pension Plan, (i) a Reportable Event, (ii) the termination of a Pension Plan, or the filing of a notice of intent to terminate 54

a Pension Plan, or the treatment of a Pension Plan amendment as a termination under Section 4041(c) of ERISA, (iii) the institution of proceedings to terminate a Pension Plan under Section 4042 of ERISA, or (iv) the appointment of a trustee to administer any Pension Plan under Section 4042 of ERISA. "TRADE LETTERS OF CREDIT": as defined in Section 2.8(a). "UNFUNDED PENSION LIABILITIES": with respect to any Pension Plan, at any date of determination, the amount determined by taking the accumulated benefit obligation, as disclosed in accordance with Statement of Accounting Standards No. 87, "Employers' Accounting for Pensions", over the fair market value of Pension Plan assets. "UNITED STATES": the United States of America. "UNRECOGNIZED RETIREE WELFARE LIABILITY": with respect to any Employee Benefit Plan that provides postretirement benefits other than pension benefits, the amount of the transition obligation, as determined in accordance with Statement of Financial Accounting Standards No. 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions," as of the most recent valuation date, that has not been recognized as an expense in an income statement of the Parent Borrower and its Consolidated subsidiaries, provided that, prior to the date such Statement is applicable to the Parent Borrower, such amount shall be based on an estimate made in good faith of such transition obligation. "UNRESTRICTED INTERCOMPANY ACQUISITION": (i) an Acquisition by the Parent Borrower or any Guarantor from the Parent Borrower or any Subsidiary of the Parent Borrower or (ii) an Acquisition by any such Subsidiary (other than a Guarantor) from any such Subsidiary (other than a Guarantor). "UNRESTRICTED INTERCOMPANY DISPOSITION": (i) a Disposition by the Parent Borrower or any Subsidiary thereof to the Parent Borrower or any Guarantor or (ii) a Disposition by any such Subsidiary (other than a Guarantor) to any such Subsidiary (other than a Guarantor). "UNRESTRICTED INTERCOMPANY INDEBTEDNESS": (i) Indebtedness of the Parent Borrower or any Guarantor to the Parent Borrower or any Subsidiary of the Parent Borrower or (ii) Indebtedness of any such Subsidiary (other than a Guarantor) to any such Subsidiary (other than a Guarantor). "UNRESTRICTED INTERCOMPANY INVESTMENT": (i) an Investment by the Parent Borrower or any Subsidiary thereof in the Parent Borrower or any Guarantor or (ii) an Investment by any such Subsidiary (other than a Guarantor) in any such Subsidiary (other than a Guarantor). 55

"UNRESTRICTED INTERCOMPANY PAYMENT": (i) a Restricted Payment made by any Subsidiary of the Parent Borrower to the Parent Borrower or any Guarantor, to the extent received by the Parent Borrower or such Guarantor, as the case may be, or (ii) a Restricted Payment made by any such Subsidiary (other than a Guarantor) to any such Subsidiary (other than a Guarantor), to the extent received by such Subsidiary. 1.2. PRINCIPLES OF CONSTRUCTION (a) All terms defined in a Loan Document shall have the meanings given such terms therein when used in the other Loan Documents or any certificate, opinion or other document made or delivered pursuant thereto to the extent not otherwise provided therein. (b) As used in the Loan Documents and in any certificate, opinion or other document made or delivered pursuant thereto, accounting terms not defined in Section 1.1, and accounting terms partly defined in Section 1.1, to the extent not defined, shall have the respective meanings given to them under GAAP. If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in this Agreement, the Administrative Agent, the Issuing Bank, the Swing Line Lender, the Lenders and the Parent Borrower shall negotiate in good faith to amend such ratio or requirement to reflect such change in GAAP (subject to the approval of the Required Lenders), provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Parent Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement (or such other items as the Administrative Agent may reasonably requested) setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP. (c) The words "hereof", "herein", "hereto" and "hereunder" and similar words when used in a Loan Document shall refer to such Loan Document as a whole and not to any particular provision thereof, and Section, schedule and exhibit references contained therein shall refer to Sections thereof or schedules or exhibits thereto unless otherwise expressly provided therein. (d) The phrase "may not" is prohibitive and not permissive. (e) Unless the context otherwise requires, words in the singular number include the plural, and words in the plural include the singular. (f) Unless specifically provided in a Loan Document to the contrary, any reference to a time shall refer to such time in New York. (g) Unless specifically provided in a Loan Document to the contrary, in the computation of periods of time from a specified date to a later specified date, the 56

word "from" means "from and including" and the words "to" and "until" each means "to but excluding". (h) References in any Loan Document to a fiscal period shall refer to that fiscal period of the Parent Borrower. (i) The words "include" and "including", when used in each Loan Document, shall mean that the same shall be included "without limitation", unless otherwise expressly provided therein. 2. AMOUNT AND TERMS OF LOANS AND LETTERS OF CREDIT 2.1. REVOLVING CREDIT LOANS Subject to the terms and conditions of this Agreement, each Lender severally (and not jointly) agrees to make revolving credit loans (each a "REVOLVING CREDIT LOAN" and, as the context may require, collectively with all other Revolving Credit Loans of such Lender and with the Revolving Credit Loans of all other Lenders, the "REVOLVING CREDIT LOANS") to one or more of the Borrowers in the Core Currencies from time to time during the Revolving Credit Commitment Period, PROVIDED, HOWEVER, that: (a) immediately after giving effect thereto, (i) such Lender's Revolving Credit Exposure shall not exceed such Lender's Revolving Credit Commitment Amount, (ii) the Aggregate Credit Exposure shall not exceed the Aggregate Revolving Credit Commitment Amount, and (iii) if such Revolving Credit is an Alternate Currency Revolving Credit Loan, the aggregate principal amount of all Alternate Currency Loans (in each case determined on the basis of the Dollar Equivalent thereof) shall not exceed $50,000,000, and (b) such Revolving Credit Loan, (i) if to be made in Dollars (each a "DOLLAR REVOLVING CREDIT LOAN"), shall be made to the Parent Borrower, (ii) if to be made in Dutch Guilders, shall be made to a Dutch Borrower, (iii) if to be made in French Francs, shall be made to a French Borrower, and (iv) if to be made in German Marks, shall be made to a German Borrower. During the Revolving Credit Commitment Period, the Borrowers may borrow, prepay in whole or in part and reborrow under the Revolving Credit Commitments, all in accordance with the terms and conditions of this Agreement. Subject to the provisions of Sections 2.3 and 3.3, at the option of the Parent Borrower, Dollar Revolving Credit Loans may be made as (A) one or more ABR Advances, (B) one or more Eurodollar Advances, or (C) a combination thereof. The outstanding principal amount of the Revolving Credit Loans shall be due and payable on the Revolving Credit Maturity Date. 57

2.2. SWING LINE LOANS (a) Subject to the terms and conditions hereof, the Swing Line Lender agrees to make swing line loans (each a "SWING LINE Loan" and, collectively, the "SWING LINE LOANS") to the Parent Borrower in Dollars from time to time during the Swing Line Commitment Period in an aggregate principal amount at any one time outstanding not to exceed the Swing Line Commitment Amount, PROVIDED, HOWEVER, that, immediately after making each Swing Line Loan, (i) the aggregate unpaid balance of the Swing Line Loans would not exceed the Swing Line Commitment Amount and (ii) the Aggregate Credit Exposure would not exceed the Aggregate Revolving Credit Commitment Amount. During the Swing Line Commitment Period, the Parent Borrower may borrow, prepay in whole or in part and reborrow under the Swing Line Commitment, all in accordance with the terms and conditions of this Agreement. No Swing Line Loan shall be made prior to the making of the first Revolving Credit Loans on the first Borrowing Date. (b) The Swing Line Lender shall not be obligated to make any Swing Line Loan at a time when any Lender shall be in default of its obligations under this Agreement unless arrangements to eliminate the Swing Line Lender's risk with respect to such defaulting Lender's participation in such Swing Line Loan shall have been made for the benefit of the Swing Line Lender and such arrangements are in all respects satisfactory to the Swing Line Lender. The Swing Line Lender will not make any Swing Line Loan if the Administrative Agent or any Lender, by notice to the Swing Line Lender and the Parent Borrower no later than one Business Day prior to the Borrowing Date with respect to such Swing Line Loan, shall have determined that the conditions set forth in Section 6 have not been satisfied and such conditions remain unsatisfied as of the requested time of the making such Swing Line Loan. Each Swing Line Loan shall be due and payable on the earlier to occur of the last day of the Swing Line Interest Period applicable thereto and the Swing Line Maturity Date. (c) Upon each receipt by a Lender of notice of an Event of Default from the Administrative Agent pursuant to Section 10.5, such Lender shall purchase unconditionally, irrevocably, and severally (and not jointly) from the Swing Line Lender a participation in the outstanding Swing Line Loans (including accrued interest thereon) in an amount (the "SWING LINE PARTICIPATION AMOUNT") equal to the product of its Commitment Percentage and the aggregate outstanding principal amount of the Swing Line Loans plus all accrued and unpaid interest thereon. Each Lender shall also be liable for an amount equal to the product of its Commitment Percentage and any amounts paid by any Credit Party pursuant to this Section that are subsequently rescinded or avoided, or must be otherwise restored or returned. Such liabilities shall be absolute and unconditional and without regard to the occurrence of any Default or the compliance by and Credit Party with any of its obligations under the Loan Documents. (d) In furtherance of Section 2.2(c), upon each receipt by a Lender of notice of an Event of Default from the Administrative Agent pursuant to Section 10.5, 58

such Lender shall promptly make available its Swing Line Participation Amount to the Administrative Agent for the account of the Swing Line Lender at the applicable Agent Payment Office, in Dollars, and in immediately available funds. The Administrative Agent shall deliver the payments made by each Lender pursuant to the immediately preceding sentence to the Swing Line Lender promptly upon receipt thereof in like funds as received. Each Lender shall indemnify and hold harmless the Administrative Agent and the Swing Line Lender from and against any and all losses, liabilities (including liabilities for penalties), actions, suits, judgments, demands, costs and expenses resulting from any failure on the part of such Lender to pay, or from any delay in paying the Administrative Agent any amount such Lender is required to pay in accordance with this Section 2.2 (except in respect of losses, liabilities, actions, suits, judgments, demands, costs and expenses suffered by the Administrative Agent or the Swing Line Lender, as the case may be, resulting from the gross negligence or willful misconduct of the Administrative Agent or the Swing Line Lender, as the case may be), and such Lender shall be required to pay interest to the Administrative Agent for the account of the Swing Line Lender from the date such amount was due until paid in full, on the unpaid portion thereof, at a rate of interest per annum equal to the Federal Funds Rate payable upon demand by the Swing Line Lender. The Administrative Agent shall distribute such interest payments to the Swing Line Lender upon receipt thereof in like funds as received. (e) Whenever the Administrative Agent is reimbursed by any Credit Party, for the account of the Swing Line Lender, for any payment in connection with Swing Line Loans and such payment relates to an amount previously paid by a Lender pursuant to this Section, the Administrative Agent will promptly pay over such payment to such Lender. 2.3. PROCEDURE FOR BORROWING (a) REVOLVING CREDIT LOANS. Any Borrower may borrow under the Revolving Credit Commitments on any Business Day or any Core Currency Business Day, as the case may be, during the Revolving Credit Commitment Period, provided that such Borrower or, if such Borrower is a Subsidiary Borrower, the Parent Borrower, on behalf of such Borrower, shall notify the Administrative Agent by the delivery of a Borrowing Request, which shall be sent by facsimile and shall be irrevocable (confirmed promptly by the delivery to the Administrative Agent of a Borrowing Request manually signed by such Borrower or the Parent Borrower, on behalf of such Borrower, as the case may be), no later than: 11:00 a.m. three Core Currency Business Days prior to the requested Borrowing Date, in the case of Eurodollar Advances, 11:00 a.m. four Core Currency Business Days prior to the requested Borrowing Date, in the case of Core Currency Euro Advances, and 10:00 a.m. on the requested Borrowing Date, in the case of ABR Advances, specifying (i) the requested Borrowing Date, (ii) whether such borrowing is to consist of one or more Eurodollar Advances, one or more Core Currency Euro Advances, ABR Advances, or a combination thereof, and the amount of each 59

thereof (stated in the applicable Currency), and (iii) if the borrowing is to consist of one or more Eurodollar Advances or Core Currency Euro Advances, the length of the Euro Interest Period for each such Eurodollar Advance and Core Currency Euro Advance. Notwithstanding anything to the contrary contained herein, (A) each Eurodollar Advance to be made on a Borrowing Date, when aggregated with all amounts to be converted to a Eurodollar Advance on such date and having the same Euro Interest Period as such first Eurodollar Advance, shall equal no less than $5,000,000 or such amount plus a whole multiple of $1,000,000 in excess thereof, (B) each Core Currency Euro Advance to be made on a Borrowing Date, when aggregated with all amounts to be converted to a Core Currency Euro Advance on such date and having the same Euro Interest Period, and being denominated in the same Currency, as such first Core Currency Euro Advance shall not be less than an amount in such Currency having a Dollar Equivalent of approximately $2,500,000 or such amount plus an amount in such Currency having a Dollar Equivalent of a whole multiple of approximately $1,000,000 in excess thereof, and (C) each ABR Advance to be made on a Borrowing Date shall equal no less than $1,000,000 or such amount plus a whole multiple of $100,000 in excess thereof or, if less, the unused portion of the Aggregate Revolving Credit Commitment Amount. (b) SWING LINE LOANS. The Parent Borrower may borrow under the Swing Line Commitment on any Business Day during the Swing Line Commitment Period, provided that the Parent Borrower shall notify the Administrative Agent and the Swing Line Lender (by telephone or facsimile confirmed promptly by the delivery to the Administrative Agent and the Swing Line Lender of a Borrowing Request manually signed by the Parent Borrower) no later than: 3:00 p.m. on the requested Borrowing Date, specifying (i) the aggregate principal amount to be borrowed under the Swing Line Commitment, (ii) the requested Borrowing Date, and (iii) the amount of, and the length of the Swing Line Interest Period for, each Swing Line Loan. The Swing Line Lender will then, subject to its determination that the terms and conditions of this Agreement have been satisfied and subject to its agreement with the Parent Borrower on the Negotiated Rate to be applicable thereto, make the requested amount available, in Dollars, and in immediately available funds, promptly on that same day, to the Administrative Agent at the applicable Agent Payment Office who, thereupon, will promptly make such amount available to the Parent Borrower at the such Agent Payment Office, in Dollars, and in immediately available funds. Each borrowing of Swing Line Loans shall be in an aggregate principal amount equal to $500,000 or such amount plus a whole multiple of $100,000 in excess thereof or, if less, the unused portion of the Swing Line Commitment Amount. (c) FUNDING OF REVOLVING CREDIT LOANS. Upon receipt of each Borrowing Request requesting Revolving Credit Loans, the Administrative Agent shall promptly notify each Lender thereof. Subject to its receipt of the notice referred to in the preceding sentence, each Lender will make the amount of its Commitment Percentage of the requested Revolving Credit Loans available to the Administrative Agent for the account of the applicable Borrower at the applicable Agent Payment Office in the 60

applicable Currency not later than (i) 11:00 a.m. (local time in the city in which such Agent Payment Office is located), in the case of an Alternate Currency Revolving Credit Loan, and (ii) 2:00 p.m. (New York City time), in the case of a Dollar Revolving Credit Loan, in each case on the on the relevant Borrowing Date requested by such Borrower or the Parent Borrower, on behalf of such Borrower, as the case may be, in funds immediately available to the Administrative Agent at such Agent Payment Office. The amounts so made available to the Administrative Agent on such Borrowing Date will then, subject to the satisfaction of the terms and conditions of this Agreement, as determined by the Administrative Agent, be made available on such Borrowing Date to such Borrower by the Administrative Agent at such Agent Payment Office, in such Currency, and in immediately available funds, no later than (A) 1:30 p.m. (local time in the city in which such Agent Payment Office is located), in the case of an Alternate Currency Revolving Credit Loan, and (B) 3:00 p.m. (New York City time), in the case of a Dollar Revolving Credit Loan. (d) FAILURE TO FUND. Unless the Administrative Agent shall have received prior notice from a Lender (by telephone or otherwise, such notice to be promptly confirmed by facsimile or other writing) that such Lender will not make available to the Administrative Agent such Lender's Commitment Percentage of the Revolving Credit Loans to be made on a Borrowing Date, the Administrative Agent may assume that such Lender has made such amount available to the Administrative Agent on the Borrowing Date in accordance with this Section, provided that such Lender received notice thereof from the Administrative Agent in accordance with the terms hereof, and the Administrative Agent may, in reliance upon such assumption, make available to the applicable Borrower on such Borrowing Date a corresponding amount. If and to the extent such Lender shall not have so made such amount available to the Administrative Agent, such Lender and such Borrower severally agree to pay to the Administrative Agent, forthwith on demand, such corresponding amount (to the extent not previously paid by the other), together with interest thereon for each day from the date such amount is made available to such Borrower until the date such amount is paid to the Administrative Agent, at a rate per annum equal to, in the case of such Borrower, the applicable interest rate set forth in Section 3.1, and, in the case of such Lender, the Federal Funds Rate (or, in the case of each Alternate Currency Loan, a rate determined by the Administrative Agent to be reflective of the all-in cost of funds to the Administrative Agent in funding such Alternate Currency Loan). Such payment by such Borrower, however, shall be without prejudice to its rights against such Lender. If such Lender shall pay to the Administrative Agent such corresponding amount, such amount so paid shall constitute such Lender's Revolving Credit Loan as part of such Revolving Credit Loans for purposes of this Agreement, which Revolving Credit Loan shall be deemed to have been made by such Lender on the such Borrowing Date. (e) BORROWER ACCOUNTS. Each Loan shall be made to the applicable payment account of the applicable Borrower set forth in Exhibit P or the Borrower Addendum, if any, executed and delivered with respect to such Borrower pursuant to 61

Section 2.12, as the case may be, or such other account which such Borrower may from time to time specify by written notice to the Administrative Agent and the Lenders. 2.4. BID PROCEDURE (a) Each Borrower may, provided that no Default shall have occurred and be continuing, request Bids for one or more Bid Loans denominated in any Currency during the Commitment Period by delivering, or, if such Borrower is a Subsidiary Borrower, causing the Parent Borrower to deliver, on behalf of such Borrower, by hand or facsimile to the Administrative Agent a duly completed Bid Request no later than 12:00 noon: four Core Currency Business Days, in the case of Alternate Currency Bid Loans, and one Business Day, in the case of Dollar Bid Loans, in each case before the proposed Borrowing Date therefor. A request for Bids that does not conform substantially to the format of Exhibit I may be rejected in the Administrative Agent's sole discretion, and the Administrative Agent shall promptly notify the applicable Borrower and, if such Borrower is a Subsidiary Borrower, the Parent Borrower of such rejection by facsimile. Each Bid Request shall specify (i) the amount of each Bid Loan (stated in the applicable Currency), (ii) the proposed Borrowing Date therefor, and (iii) the Bid Interest Period or Bid Interest Periods (which shall not exceed three different Bid Interest Periods in a single Bid Request), with respect thereto. Promptly after its receipt of each Bid Request that is not rejected as aforesaid, the Administrative Agent shall send to each Lender an Invitation to Bid, appropriately completed by the Administrative Agent with reference to such Bid Request. (b) Each Lender may, in its sole and absolute discretion, make one or more Bids in response to each Invitation to Bid. Each Bid by a Lender must be received by the Administrative Agent not later than 9:30 a.m.: one Core Currency Business Day before the proposed Borrowing Date for a proposed Alternate Currency Bid Loan and on the proposed Borrowing Date for a proposed Dollar Bid Loan. Bids to make Bid Loans that do not conform substantially to the format of Exhibit K may be rejected by the Administrative Agent after conferring with, and upon the instruction of, the applicable Borrower and, if such Borrower is a Subsidiary Borrower, the Parent Borrower, and the Administrative Agent shall notify the Lender making such nonconforming bid of such rejection as soon as practicable. Each Bid shall be irrevocable and shall specify (i) the amount (stated in the applicable Currency and which (A) shall be in a minimum principal amount of $5,000,000 or such amount plus a whole multiple of $1,000,000 in excess thereof (or, in the case of Alternate Currency Bid Loans, an amount in the applicable Alternate Currency having a Dollar Equivalent of approximately $5,000,000 or such amount plus an amount in the applicable Alternate Currency having a Dollar Equivalent of a whole multiple of approximately $1,000,000 in excess thereof), and (B) may equal the entire principal amount requested by such Borrower) of such Bid Loan, (ii) the Bid Rate with respect to such Bid Loan, and (iii) the Bid Interest Period with respect to such Bid Loan and the last day thereof. If any Lender shall elect not to make a Bid, such Lender shall so notify the Administrative Agent by facsimile not later than 9:30 a.m.: one 62

Core Currency Business Day before the proposed Borrowing Date for a proposed Alternate Currency Bid Loan and on the proposed Borrowing Date for a proposed Dollar Bid Loan, PROVIDED, HOWEVER, that the failure by any Lender to give any such notice shall not obligate such Lender to make any Bid Loan in connection with the relevant Bid Request. (c) With respect to each Invitation to Bid sent to the Lenders, the Administrative Agent shall (i) promptly notify the applicable Borrower and, if such Borrower is a Subsidiary Borrower, the Parent Borrower by facsimile of each Bid made, the amount (stated in the applicable Currency) of the Bid Loan offered thereby, and the identity of the Lender that made such Bid, and (ii) send a list of all Bids to such Borrower and, if such Borrower is a Subsidiary Borrower, the Parent Borrower for their respective records as soon as practicable after completion of the bidding process. Each notice and list sent by the Administrative Agent pursuant to this Section 2.4(c) shall list the Bids in ascending yield order. (d) The applicable Borrower may in its sole and absolute discretion, subject only to the provisions of this Section 2.4(d), accept or reject any Bid made in accordance with the procedures set forth in this Section 2.4, and such Borrower or, if such Borrower is a Subsidiary Borrower, the Parent Borrower, on behalf of such Borrower, shall notify the Administrative Agent by telephone, confirmed by facsimile in the form of a Bid Accept/Reject Letter, whether and to what extent it has decided to accept or reject any or all of such Bids, not later than 10:30 a.m.: one Core Currency Business Day before the proposed Borrowing Date for a proposed Alternate Currency Bid Loan and on the proposed Borrowing Date for a proposed Dollar Bid Loan, PROVIDED, HOWEVER, that the failure by such Borrower or the Parent Borrower, on behalf of such Borrower, as the case may be, to give such notice shall be deemed to be a rejection of all such Bids. In connection with each acceptance of one or more Bids by such Borrower: (i) such Borrower shall not accept a Bid made at a particular Bid Rate if it has decided to reject any other Bid made at a lower Bid Rate and having the same Bid Interest Period as such Bid, (ii) the aggregate amount of the Bids accepted by such Borrower shall not exceed the principal amount specified in the Bid Request therefor (determined, in the case of each Alternate Currency Bid Loan, on the basis of the Dollar Equivalent thereof), (iii) if such Borrower shall desire to accept a Bid made at a particular Bid Rate and having a particular Bid Interest Period, it must accept all other Bids made at such Bid Rate and having such Bid Interest Period, PROVIDED, HOWEVER, that, if the acceptance of all such other Bids would cause the aggregate amount of all such accepted Bids to exceed the amount requested (determined, in the case of each Alternate Currency Bid Loan, on the basis of the Dollar Equivalent thereof), then such acceptance shall be made pro rata in accordance 63

with the amount of each such Bid at such Bid Rate and having such Bid Interest Period, and (iv) except pursuant to Section 2.4(d)(ii), no Bid shall be accepted unless the Bid Loan with respect thereto shall be in (1) a minimum principal amount of $5,000,000, or such amount plus a whole multiple of $1,000,000 in excess thereof (or, in the case of Alternate Currency Bid Loans, an amount in the applicable Alternate Currency having a Dollar Equivalent of approximately $5,000,000, or such amount plus an amount in the applicable Alternate Currency having a Dollar Equivalent of a whole multiple of approximately $1,000,000 in excess thereof), or (2) if less, an aggregate principal amount equal to the excess of the Aggregate Commitment Amount over the outstanding principal amount of all Loans (determined, in the case of each Alternate Currency Bid Loan, on the basis of the Dollar Equivalent thereof). (e) The Administrative Agent shall promptly notify each bidding Lender whether or not each Bid of such Lender has been accepted (and, if so, in what amount) by facsimile sent by the Administrative Agent, and, if such Bid has been accepted by the applicable Borrower, in whole or in part, such bidding Lender shall, after its receipt of such notice, make immediately available funds in the applicable Currency and in the amount in which such Bid was so accepted available, (i) in the case of Dollar Bid Loans, to the Administrative Agent at the applicable Agent Payment Office, and (ii) in the case of Alternate Currency Bid Loans, (A) directly to such Borrower, or (B) upon the occurrence and during the continuance of an Event of Default, if directed by the Required Lenders and with the consent of the Administrative Agent, to the Administrative Agent at the applicable Agent Payment Office, in each case no later than 12:00 noon (local time in the city in which such funds are to be made available in accordance with the terms hereof) on the proposed Borrowing Date. The Administrative Agent will make available to such Borrower at the applicable Agent Payment Office, in the applicable Currency, and in immediately available funds, the aggregate of any amount so made available by such Lender no later than 2:30 p.m. (such local time) on such Borrowing Date. Notwithstanding anything to the contrary contained herein, no Lender shall be obligated to make a Bid Loan if, immediately after making such Bid Loan, (1) the outstanding principal amount of the Bid Loans of all Lenders (determined, in the case of each Alternate Currency Bid Loan, on the basis of the Dollar Equivalent thereof) would exceed 50% of the Aggregate Revolving Credit Commitment Amount, and (2) if such Bid Loan is an Alternate Currency Bid Loan, the aggregate principal amount of all Alternate Currency Loans (in each case determined on the basis of the Dollar Equivalent thereof) shall not exceed $50,000,000. (f) A Bid Request shall not be made within five Business Days after the date of any previous Bid Request, unless the applicable Borrower has accepted one or more Bids pursuant to a Bid Request made within such five Business Days. 64

(g) If the Administrative Agent shall elect to submit a Bid in its capacity as a Lender, it shall submit such bid directly to the applicable Borrower and, if such Borrower is a Subsidiary Borrower, the Parent Borrower fifteen minutes earlier than the latest time at which the other Lenders are required to submit their bids to the Administrative Agent pursuant to Section 2.4(b). (h) All notices required by this Section 2.4 shall be given in accordance with Section 11.2. (i) Each Bid Loan shall be due and payable on the last day of the Bid Interest Period applicable thereto. 2.5. TERMINATION OR REDUCTION OF COMMITMENTS (a) VOLUNTARY TERMINATION OR REDUCTIONS. The Parent Borrower shall have the right, upon at least three Business Days' prior written notice to the Administrative Agent, (i) at any time when the Aggregate Credit Exposure shall be zero, to terminate the Revolving Credit Commitments of all of the Lenders, and (A) at any time and from time to time when the Aggregate Revolving Credit Commitment Amount shall exceed the Aggregate Credit Exposure, to reduce permanently the Aggregate Revolving Credit Commitment Amount by a sum not greater than the amount of such excess, PROVIDED, HOWEVER, that each such reduction shall be in the amount of $5,000,000 or such amount plus a whole multiple of $1,000,000 in excess thereof. Each of the Parent Borrower and the Swing Line Lender shall have the right, upon at least three Business Days' prior written notice to the other and the Administrative Agent, to terminate the Swing Line Commitment and/or permanently reduce the Swing Line Commitment Amount, PROVIDED, HOWEVER, that each such reduction shall be in the amount of $1,000,000 or such amount plus a whole multiple of $1,000,000 in excess thereof. (b) REDUCTIONS IN GENERAL. Each reduction of the Aggregate Revolving Credit Commitment Amount shall be made by reducing each Lender's Revolving Credit Commitment Amount by an amount equal to such Lender's Commitment Percentage of such reduction. 2.6. PREPAYMENTS (a) VOLUNTARY PREPAYMENTS. Each Borrower may, at its option, prepay the Revolving Credit Loans or the Swing Line Loans, as the case may be, without premium or penalty (but subject to Section 3.4), in full at any time or in part from time to time by delivering, or, if such Borrower is a Subsidiary Borrower, causing the Parent Borrower, on behalf of such Borrower, to deliver, to the Administrative Agent an irrevocable written notice thereof at least one Business Day's prior to the proposed prepayment date, in the case of Revolving Credit Loans consisting of ABR Advances or Swing Line Loans, as the case may be, and at least three Core Currency Business Days prior to the proposed prepayment date, in the case of Revolving Credit Loans consisting 65

of Eurodollar Advances or Core Currency Euro Advances, as the case may be, in each case specifying whether the Loans to be prepaid consist of Revolving Credit Loans or Swing Line Loans, and, in the case of Revolving Credit Loans, whether such Revolving Credit Loans consist of ABR Advances, Eurodollar Advances, Core Currency Euro Advances, or a combination thereof, the amount to be prepaid (stated in the applicable Currency), and the date of prepayment, whereupon the amount specified in such notice shall be due and payable on the date specified. Upon receipt of such notice, the Administrative Agent shall promptly notify each Lender thereof. Each partial prepayment pursuant to this Section 2.6(a) shall be (i) in the case of Swing Line Loans, in a minimum amount of $500,000 or such amount plus a whole multiple of $100,000 in excess thereof, (ii) in the case of ABR Advances and Eurodollar Advances, in a minimum amount of $1,000,000 or such amount plus a whole multiple of $1,000,000 in excess thereof, and (iii) in the case of Core Currency Euro Advances, in a minimum amount in the applicable Currency having an Alternate Currency Equivalent of approximately $1,000,000 or such amount plus an amount in the applicable Currency having an Alternate Currency Equivalent of a whole multiple of approximately $100,000 in excess thereof. Except as otherwise permitted by Sections 2.6(b) or 3.7, no Borrower shall, or shall be permitted to, prepay any Bid Loan without the prior consent of the applicable Lender. (b) AGGREGATE CREDIT EXPOSURE PREPAYMENTS. If, on the last day of any calendar quarter, the Aggregate Credit Exposure shall exceed the Aggregate Revolving Credit Commitment Amount, then the Borrowers shall prepay the Loans on the immediately succeeding Business Day such that, immediately after giving effect thereto, the Aggregate Credit Exposure shall not exceed the Aggregate Revolving Credit Commitment Amount. (c) IN GENERAL. Simultaneously with each prepayment hereunder, the Borrowers shall prepay all accrued and unpaid interest on the amount prepaid through the date of prepayment. 2.7. USE OF PROCEEDS Each Borrower agrees that the proceeds of the Loans shall be used solely (i) to pay all of the Fees, (ii) to pay the reasonable out-of-pocket fees and expenses incurred by the Borrowers in connection with the Loan Documents, (iii) for the Borrowers' working capital purposes in the ordinary course of business, and (iv) for the Borrowers' general corporate purposes not inconsistent with the provisions hereof. Notwithstanding anything to the contrary contained in any Loan Document, each Borrower further agrees that no part of the proceeds of any Loan, and no Letter of Credit, will be used, directly or indirectly, for a purpose which violates any law, rule or regulation of any Governmental Authority, including the provisions of Regulations G, T, U or X of the Board of Governors of the Federal Reserve System, as amended. 66

2.8. LETTER OF CREDIT SUB-FACILITY (a) Subject to the terms and conditions of this Agreement, the Issuing Bank agrees, in reliance on the agreement of the other Lenders set forth in Section 2.9, to issue standby letters of credit (the "STANDBY LETTERS OF CREDIT") or commercial (trade) letters of credit (the "TRADE LETTERS OF CREDIT" and, together with the Standby Letters of Credit, the "LETTERS OF CREDIT") denominated in Dollars during the Revolving Credit Commitment Period for the account of the Parent Borrower, provided that, immediately after the issuance of each Letter of Credit, (i) the Letter of Credit Exposure of all Lenders (whether or not the conditions for drawing under any Letter of Credit have or may be satisfied) would not exceed the Letter of Credit Commitment Amount, and (ii) the Aggregate Credit Exposure would not exceed the Aggregate Revolving Credit Commitment Amount. Each Letter of Credit shall have an expiration date which shall be not later than the earlier of (i) twelve months after the date of issuance thereof or (ii) five Business Days before the Scheduled Revolving Credit Commitment Termination Date. No Letter of Credit shall be issued if the Administrative Agent, or any Lender by notice to the Administrative Agent no later than 1:00 p.m. one Business Day prior to the requested date of issuance of such Letter of Credit, shall have determined that any condition set forth in Sections 5 or 6 has not been satisfied. (b) Each Letter of Credit shall be issued for the account of the Parent Borrower in support of an obligation of the Parent Borrower or any Subsidiary thereof in favor of a beneficiary who has requested the issuance of such Letter of Credit as a condition to a transaction entered into in the ordinary course of business. The Parent Borrower shall give the Administrative Agent a Letter of Credit Request for the issuance of each Letter of Credit by no later than 11:00 a.m. three Business Days prior to the requested date of issuance. Each Letter of Credit Request shall be accompanied by the Issuing Bank's standard letter of credit application, standard reimbursement agreement (each a "REIMBURSEMENT AGREEMENT") and such other documentation as the Issuing Bank may reasonably require, executed by the Parent Borrower. Upon receipt of such Letter of Credit Request from the Parent Borrower, the Administrative Agent shall promptly notify the Issuing Bank and each other Lender thereof. Each Letter of Credit shall be in form and substance reasonably satisfactory to the Issuing Bank, with such provisions with respect to the conditions under which a drawing may be made thereunder and the documentation required in respect of such drawing as the Issuing Bank shall reasonably require. The Issuing Bank shall, on the proposed date of issuance, and subject to the terms and conditions of the Reimbursement Agreement and to the other terms and conditions of this Agreement, issue the requested Letter of Credit. (c) Upon each payment by the Issuing Bank of a draft drawn under a Letter of Credit, the Parent Borrower shall pay to the Administrative Agent, for the account of the Issuing Bank, an amount equal to such payment. 67

(d) Notwithstanding anything to the contrary contained herein or in any Reimbursement Agreement, to the extent that the terms of this Agreement shall be inconsistent with the terms of such Reimbursement Agreement, the terms of this Agreement shall govern. 2.9. LETTER OF CREDIT PARTICIPATION AND FUNDING COMMITMENTS (a) Each Lender hereby unconditionally, irrevocably and severally (and not jointly) for itself only and without any notice to or the taking of any action by such Lender, takes an undivided participating interest in the obligations of the Issuing Bank under and in connection with each Letter of Credit in an amount equal to such Lender's Commitment Percentage of the amount of such Letter of Credit. Each Lender shall be liable to the Issuing Bank for its Commitment Percentage of (i) the unreimbursed amount of any draft drawn and honored under each Letters of Credit, and (ii) any amounts paid by any Credit Party pursuant to Sections 2.8(c) or 3.6 that are subsequently rescinded or avoided, or must be otherwise restored or returned. Such liabilities shall be unconditional and without regard to the occurrence of any Default or the compliance by any Credit Party with the Loan Documents. (b) The Issuing Bank will promptly notify the Administrative Agent, and the Administrative Agent will promptly notify each Lender (which notice shall be promptly confirmed in writing) of the date and the amount of any draft presented under each Letters of Credit with respect to which full reimbursement is not made as provided in Section 2.8(c), and forthwith upon receipt of each such notice, such Lender (other than the Issuing Bank in its capacity as a Lender) shall make available to the Administrative Agent for the account of the Issuing Bank its Commitment Percentage of the amount of such unreimbursed draft at the office of the applicable Agent Payment Office, in Dollars, and in immediately available funds, before 4:00 p.m. on the day such notice was given by the Administrative Agent, if the relevant notice was given by the Administrative Agent at or prior to 1:00 p.m. on such day, and before 12:00 noon, on the next Business Day, if the relevant notice was given by the Administrative Agent after 1:00 p.m. on such day. The Administrative Agent shall distribute the payments made pursuant to the immediately preceding sentence to the Issuing Bank promptly upon receipt thereof in like funds as received. Each Lender shall indemnify and hold harmless the Administrative Agent and the Issuing Bank from and against any and all losses, liabilities (including liabilities for penalties), actions, suits, judgments, demands, costs and expenses (including reasonable attorneys' fees and expenses and an administration fee of not less than $100 payable to the Issuing Bank as the issuer of the relevant Letter of Credit) resulting from any failure on the part of such Lender to perform its obligations under this Section 2.9 (except in respect of losses, liabilities, actions, suits, judgments, demands, costs and expenses incurred by the Issuing Bank to the extent resulting from the gross negligence or willful misconduct of the Issuing Bank). If a Lender does not make any payment required under this Section when due, such Lender shall be required to pay interest to the Administrative Agent for the account of the Issuing Bank (upon demand therefor) the amount of such 68

payment at a rate of interest per annum equal to the Federal Funds Rate from the due date of such payment until the date such payment is received by the Administrative Agent. The Administrative Agent shall distribute such interest payments to the Issuing Bank upon receipt thereof in like funds as received. (c) Whenever the Issuing Bank is reimbursed by any Credit Party or the Administrative Agent is reimbursed by any Credit Party, for the account of the Issuing Bank, for any payment under a Letter of Credit and such payment relates to an amount previously paid by a Lender pursuant to this Section, the Administrative Agent (or the Issuing Bank, to the extent that it has received the same) will pay over such payment to such Lender (i) before 4:00 p.m. on the day such payment from such Credit Party is received, if such payment is received at or prior to 1:00 p.m. on such day, or (ii) before 12:00 noon on the next succeeding Business Day, if such payment from such Credit Party is received after 1:00 p.m. on such day. 2.10. ABSOLUTE OBLIGATION WITH RESPECT TO LETTER OF CREDIT PAYMENTS The Parent Borrower's obligation to reimburse the Administrative Agent for the account of the Issuing Bank in respect of each payment under or in respect of the Letters of Credit shall be absolute and unconditional under any and all circumstances and irrespective of any set-off, counterclaim or defense to payment which any Credit Party may have or have had against the beneficiary of such Letter of Credit, the Administrative Agent, the Issuing Bank, the Swing Line Lender, any Lender or any other Person, including any defense based on the failure of any drawing to conform to the terms of such Letter of Credit, any drawing document proving to be forged, fraudulent or invalid, or the legality, validity, regularity or enforceability of such Letter of Credit, provided that, with respect to any Letter of Credit, the foregoing shall not relieve the Issuing Bank of any liability it may have to the Parent Borrower for any actual damages sustained by the Parent Borrower arising from a wrongful payment under such Letter of Credit made as a result of the Issuing Bank's gross negligence, willful misconduct or failure to meet the applicable standard of care required under UPC 500 issued by the International Chamber of Commerce (or any customs or practices published in substitution or in lieu thereof). 2.11. PAYMENTS (a) Except as otherwise specifically provided in this Agreement, each payment, including each prepayment, of principal and interest on the Loans, the Facility Fee, the Letter of Credit Commissions and all other fees to be paid to the Administrative Agent, the Issuing Bank, the Swing Line Lender and the Lenders in connection with the Loan Documents (the Facility Fee and the Letter of Credit Commissions, together with all of such other fees, being sometimes hereinafter collectively referred to as the "FEES") shall be made by the Borrowers to the Administrative Agent at the applicable Agent Payment Office in funds immediately available to the Administrative Agent at such office by 12:00 noon (local time in the city in which such Agent Payment Office is located) on the due date for such payment, PROVIDED, HOWEVER, that, unless an Event of Default has 69

occurred and is continuing and the Required Lenders have directed the Administrative Agent and the Borrowers to the contrary, and the Administrative Agent shall have consented thereto, each payment, including each prepayment, of principal and interest on the Alternate Currency Bid Loans shall be made directly by the applicable Borrower to the applicable Lender by 12:00 noon (local time in the city in which such payment is to be made in accordance with the terms hereof), and such Lender and such Borrower or, if such Borrower is a Subsidiary Borrower, the Parent Borrower, on behalf of such Borrower, shall promptly notify the Administrative Agent of the date and amount of such payment. The failure of the applicable Borrower to make any such payment by such time shall not constitute a default hereunder, provided that such payment is made on such due date, but any such payment made after 2:00 p.m. (local time in the city in which such payment is to be made in accordance with the terms hereof) on such due date shall be deemed to have been made on the next Business Day or Core Currency Business Day, as the case may be, for the purpose of calculating interest on amounts outstanding on the applicable Loans. Subject to Section 9.2(b), promptly upon receipt thereof by the Administrative Agent, (i) each payment of principal and interest on the Loans shall be remitted by the Administrative Agent in like funds as received to the Swing Line Lender and each Lender pro rata according to its Outstanding Percentage of the Loans, and (ii) each payment of the Facility Fee shall be remitted by the Administrative Agent in like funds as received to each Lender pro rata according to such Lender's Revolving Credit Commitment Amount or, if the Revolving Credit Commitments shall have terminated or been terminated, according to the outstanding principal amount of such Lender's Revolving Credit Loans. (b) Notwithstanding anything to the contrary contained in any Loan Document, each payment (including each prepayment) of principal and interest on each Alternate Currency Loan shall be made solely in the Currency in which such Alternate Currency Loan is denominated. (c) If any payment hereunder or under any Reimbursement Agreement shall be due and payable on a day which is not a Business Day or a Core Currency Business Day, as the case may be, the due date thereof (except as otherwise provided herein) shall be extended to the next Business Day or Core Currency Business Day, as the case may be, and (except with respect to payments in respect of the Fees) interest shall be payable at the applicable rate specified herein during such extension, PROVIDED, HOWEVER, that, if such next Business Day or Core Currency Business Day, as the case may be, is after the Revolving Credit Maturity Date or the Swing Line Maturity Date, as the case may be, any such payment shall be due on the immediately preceding Business Day or Core Currency Business Day, as the case may be. 70

2.12. ADDITION AND REMOVAL OF SUBSIDIARY BORROWERS; ADDITION OF NON-CORE CURRENCIES (a) ADDITION AND REMOVAL OF SUBSIDIARY BORROWERS (i) Provided that no Default has occurred and is then continuing, the Parent Borrower may from time to time direct that any of its direct or indirect wholly-owned Subsidiaries which is not then a Subsidiary Borrower become a Subsidiary Borrower by submitting a Borrower Addendum to the Administrative Agent with respect to such Subsidiary, together with (A) a certificate, dated the date of such Borrower Addendum, of the Secretary or Assistant Secretary of such Subsidiary and substantially in the form of, and with substantially the same attachments as, the certificate which would have been required under Section 5.1 if such Subsidiary had become a party hereto on the Effective Date, and (B) an opinion of counsel (excluding opinions of foreign counsel) to such Subsidiary in all respects reasonably satisfactory to the Administrative Agent, provided that, to the extent that any such certificate, attachment or opinion is not in English, it shall be accompanied by a certified English translation thereof. Upon receipt of such Borrower Addendum and all of the supporting items referred to in clauses (A) and (B) of this Section 2.12(a)(i), the Administrative Agent shall confirm such Borrower Addendum by signing a copy thereof and shall deliver a copy thereof to the Parent Borrower, the Issuing Bank, the Swing Line Lender and each Lender, at which time such Subsidiary shall become a "SUBSIDIARY BORROWER" hereunder. (ii) REMOVAL OF SUBSIDIARY BORROWERS. The Parent Borrower may from time to time direct that any Inactive Subsidiary Borrower cease to be a Subsidiary Borrower by submitting written notice thereof to the Administrative Agent. Upon receipt of such notice, the Administrative Agent shall confirm such notice by signing a copy thereof and shall deliver a copy thereof to the Parent Borrower and each Lender, at which time such Inactive Subsidiary Borrower shall cease to be a "SUBSIDIARY BORROWER" hereunder. (b) ADDITION OF NON-CORE CURRENCIES. Provided that no Default has occurred and is then continuing, the Parent Borrower may from time to time request that any currency which is not then a Non-Core Currency become a Non-Core Currency by submitting a Currency Addendum with respect to such currency to the Administrative Agent. Upon receipt of such Currency Addendum, the Administrative Agent shall confirm such Currency Addendum by signing a copy thereof and shall deliver a copy thereof to the Parent Borrower, the Issuing Bank, the Swing Line Lender and each Lender. In the event that BNY consents (which consent shall not be unreasonably withheld) to such currency becoming a Non-Core Currency in a writing delivered to the Administrative Agent and the Parent Borrower on or prior to the third day following the 71

date of such Currency Addendum, then, on the fourth day following such Currency Addendum, such currency shall become a "NON-CORE CURRENCY". 2.13. RECORDS (a) LENDER RECORDS. Each of the Lenders and the Swing Line Lender will note on its internal records with respect to each Loan made by it: (i) the date of such Loan and the identity of the Borrower to whom such Loan was made, (ii) whether such Loan is a Revolving Credit Loan, a Bid Loan, or a Swing Line Loan, (iii) in the case of each Revolving Credit Loan, (A) whether such Loan consists of one or more ABR Advances, one or more Eurodollar Advances, one or more Core Currency Euro Advances, or a combination thereof, and the amount of each thereof (stated in the applicable Currency), (B) the interest rate (without regard to the Applicable Margin) applicable to each Advance, and (C) in the case of each Eurodollar Advance and each Core Currency Euro Advance, the Euro Interest Period applicable thereto, (iv) in the case of each Bid Loan and each Swing Line Loan, (A) the Bid Rate or the Negotiated Rate, as the case may be, applicable thereto, and (B) the Bid Interest Period or the Swing Line Period, as the case may be, applicable thereto, and (v) each payment and prepayment of the principal of such Loan. (b) ADMINISTRATIVE AGENT RECORDS. The Administrative Agent shall keep records regarding the Loans, the Letters of Credit and the Loan Documents in accordance with its customary procedures for agented credits. (c) PRIMA FACIE EVIDENCE. The entries made in the records maintained pursuant to Sections 2.13(a) and (b) shall, to the extent not prohibited by applicable law and not otherwise inconsistent with any entries made in the Notes, be prima facie evidence of the existence and amount of the obligations of the Borrowers recorded therein; provided that the failure of the Administrative Agent, the Swing Line Lender or any Lender, as the case may be, to make any notation on its records shall not affect the respective obligations of the Credit Parties in respect of the Loan Documents. (d) NOTES. Upon the request of any Lender or the Swing Line Lender, as the case may be, to the Administrative Agent and the Parent Borrower, with respect to any Loan made by such Lender or the Swing Line Lender, as the case may be, the Parent Borrower agrees to execute and deliver (or cause the applicable Subsidiary Borrower to execute and deliver), at the Parent Borrower's own cost and expense, to the Administrative Agent (for delivery to such Lender or the Swing Line Lender, as the case may be) a promissory note of the applicable Borrower evidencing such Loan, substantially in the form of Exhibit Q-1, Q-2 or Q-3, as the case may be, payable to the order of such Lender or the Swing Line Lender, as the case may be, and dated the Effective Date. 72

3. INTEREST, FEES, CONVERSIONS AND YIELD PROTECTIONS 3.1. INTEREST RATES AND PAYMENT DATES (a) PRIOR TO MATURITY. Except as otherwise provided in Section 3.1(b), prior to maturity, the Loans shall bear interest on the outstanding principal amount thereof at the applicable interest rate or rates per annum set forth below: ADVANCES/LOANS RATE -------------- ---- Each ABR Advance Alternate Base Rate. Each Eurodollar Advance Eurodollar Rate for the applicable Euro Interest Period PLUS the Applicable Margin. Each Core Currency Euro Core Currency Euro Rate for the Advance applicable Euro Interest Period PLUS the Applicable Margin. Each Bid Loan Bid Rate applicable thereto for the applicable Bid Interest Period. Each Swing Line Loan Negotiated Rate applicable thereto for the applicable Swing Line Interest Period. (b) DEFAULT RATE. Upon the occurrence and during the continuance of an Event of Default under Section 9.1(a) or (b), (i) the unpaid principal amount of any Loans shall bear interest payable on demand at a rate per annum (whether before or after the entry of a judgment thereon) equal to (A) in the case of each Dollar Bid Loan and each Swing Line Loan, 2% PLUS the Bid Rate or the Negotiated Rate, as the case may be, applicable thereto until the last day of the Bid Interest Period or the Swing Line Interest Period, as the case may be, applicable thereto and, thereafter, 2% PLUS the Alternate Base Rate, (B) in the case of each Alternate Currency Bid Loan, 2% PLUS the Bid Rate applicable thereto until the last day of the Bid Interest Period applicable thereto and, thereafter, 2% PLUS the rate determined by the applicable Lender to be reflective of the all-in cost of funds to such Lender with respect thereto, and (C) in all other cases, 2% PLUS the rate which would be otherwise applicable under Section 3.1(a), and (ii) any overdue interest or other amount payable under the Loan Documents shall bear interest (whether before or after the entry of a judgment thereon) payable on demand at a rate per annum equal to 2% PLUS the Alternate Base Rate. (c) IN GENERAL. Interest on all Loans shall be calculated on the basis of a 360-day year for the actual number of days elapsed, except that interest on (i) ABR Advances, to the extent based on the BNY Rate, and (ii) Bid Loans denominated in Canadian Dollars or Sterling Pounds, in each case shall be calculated on the basis of a 73

365- or 366-day year (as the case may be) for the actual number of days elapsed. Except as otherwise expressly provided herein, interest shall be payable in arrears on each Interest Payment Date and upon each payment (including prepayment) of the Loans. Any change in the interest rate on the Loans resulting from a change in the Alternate Base Rate or reserve requirements shall become effective as of the opening of business on the day on which such change shall become effective. The Administrative Agent shall, as soon as practicable, notify the Parent Borrower, the Issuing Bank, the Swing Line Lender and the Lenders of the effective date and the amount of each such change in the BNY Rate, but any failure to so notify shall not in any manner affect the obligation of any Borrower to pay interest on the Loans in the amounts and on the dates required. Each determination of a rate of interest by the Administrative Agent or BNY, as the case may be, pursuant to the Loan Documents shall be conclusive and binding on all parties hereto absent manifest error. Each Borrower acknowledges that to the extent interest payable on ABR Advances is based on the BNY Rate, such rate is only one of the bases for computing interest on loans made by the Lenders, and by basing interest payable on ABR Advances on the BNY Rate, the Lenders have not committed to charge, and no Borrower has in any way bargained for, interest based on a lower or the lowest rate at which any Lender may now or in the future make loans to other borrowers. 3.2. FEES (a) FACILITY FEE. The Parent Borrower agrees to pay to the Administrative Agent, for the account of the Lenders in accordance with each Lender's Commitment Percentage, a fee (the "FACILITY FEE"), during the Revolving Credit Commitment Period, at a rate per annum equal to the Applicable Margin applicable thereto on the average daily Aggregate Revolving Credit Commitment Amount, regardless of usage. The Facility Fee shall be payable (i) quarterly in arrears on the last day of each March, June, September and December during the Revolving Credit Commitment Period, commencing on the first such day following the Effective Date, (ii) on the date of any reduction in the Aggregate Revolving Credit Commitment Amount (to the extent of the amount which shall have accrued on the amount of such reduction), and (iii) on the Revolving Credit Maturity Date. The Facility Fee shall be calculated on the basis of a 360-day year for the actual number of days elapsed. (b) LETTER OF CREDIT COMMISSIONS. The Parent Borrower agrees to pay to the Administrative Agent, for the account of the Lenders in accordance with each Lender's Commitment Percentage, commissions (the "LETTER OF CREDIT COMMISSIONS") with respect to the Letters of Credit for the period from and including the date of issuance of each thereof to and including the expiration date thereof, at a rate per annum equal to (i) with respect to Standby Letters of Credit, the Applicable Margin applicable thereto in effect on the date of issuance thereof, and (ii) with respect to Trade Letters of Credit, the Applicable Margin applicable thereto in effect on the date of issuance thereof, in each case on the average daily maximum amount available under any contingency to be drawn under such Letter of Credit. The Letter of Credit Commissions shall be (A) calculated on 74

the basis of a 360-day year for the actual number of days elapsed and (B) payable quarterly in arrears on the last day of each March, June, September and December of each year and on the Revolving Credit Commitment Termination Date. (c) AGENTS' FEES. Each Borrower agrees to pay to the Administrative Agent, for its own account, such other fees, if any, as have been agreed to in writing by such Borrower and the Administrative Agent. 3.3. CONVERSIONS; CONCERNING INTEREST PERIODS (a) Each applicable Borrower may elect from time to time to convert one or more Eurodollar Advances to ABR Advances by giving, or, if such Borrower is a Subsidiary Borrower, by causing the Parent Borrower, on behalf of such Borrower, to give, the Administrative Agent at least two Business Day's prior irrevocable notice of such election, specifying the amount to be converted, provided, that any such conversion of Eurodollar Advances shall only be made on the last day of the Interest Period applicable thereto, except as otherwise provided in Section 3.7. In addition, each applicable Borrower may elect from time to time to convert (i) ABR Advances to Eurodollar Advances, (ii) Eurodollar Advances to new Eurodollar Advances by selecting a new Euro Interest Period therefor, and (iii) Core Currency Euro Advances to new Core Currency Euro Advances in the same applicable Currency by selecting a new Euro Interest Period therefor, in each case by giving, or, if such Borrower is a Subsidiary Borrower, by causing the Parent Borrower, on behalf of the Borrower, to give, the Administrative Agent at least three Core Currency Business Days' prior irrevocable notice of such election, specifying the amount to be so converted and the initial Euro Interest Period relating thereto, provided that any such conversion of ABR Advances to Eurodollar Advances shall only be made on a Core Currency Business Day and, except as otherwise provided in Section 3.7, any such conversion of Eurodollar Advances to new Eurodollar Advances or Core Currency Euro Advances to new Core Currency Euro Advances, as the case may be, shall only be made on the last day of the Euro Interest Period applicable to the Eurodollar Advances or Core Currency Euro Advances, as the case may be, which are to be converted to such new Eurodollar Advances or such new Core Currency Euro Advances, as the case may be. Each such notice shall be irrevocable and shall be promptly confirmed by delivery to the Administrative Agent of a Notice of Conversion manually signed by the applicable Borrower or, if such Borrower is a Subsidiary Borrower, the Parent Borrower, on behalf of such Borrower, as the case may be. The Administrative Agent shall promptly notify each Lender (by telephone or otherwise, such notice to be confirmed by facsimile or other writing) of each such election. Advances may be converted pursuant to this Section in whole or in part, provided that (A) the amount to be converted to each Eurodollar Advance, when aggregated with any Eurodollar Advance to be made on such date in accordance with Section 2.3 and having the same Euro Interest Period as such first Eurodollar Advance, shall equal no less than $5,000,000 or such amount plus a whole multiple of $1,000,000 in excess thereof, and (B) the amount to be converted to each Core Currency Euro 75

Advance, when aggregated with any Core Currency Euro Advance to be made on such date in accordance with Section 2.3 and having the same Euro Interest Period, and being denominated in the same applicable Currency, as such first Core Currency Euro Advance, shall equal no less than an amount in such Currency having a Dollar Equivalent of approximately $2,500,000 or such amount plus an amount in such Currency having a Dollar Equivalent of a whole multiple of approximately $1,000,000 in excess thereof. (b) Notwithstanding anything in this Agreement to the contrary, upon the occurrence and during the continuance of an Event of Default, no Borrower shall have the right to elect to convert any existing ABR Advance to a new Eurodollar Advance or to convert any existing Eurodollar Advance to a new Eurodollar Advance. In such event, except as otherwise provided in Section 3.7, (i) each ABR Advance shall be automatically continued as an ABR Advance, (ii) each Eurodollar Advance shall be automatically converted to an ABR Advance on the last day of the Euro Interest Period applicable thereto, and (iii) each Core Currency Euro Advance shall, on the last day of the Euro Interest Period applicable thereto, be automatically converted to a new Core Currency Euro Advance in the same applicable Currency with a one month Euro Interest Period. (c) Each conversion shall be effected by each Lender by applying the proceeds of its new ABR Advance, new Eurodollar Advance or new Core Currency Euro Advance, as the case may be, to its Advances (or portion thereof) being converted (it being understood that any such conversion shall not constitute a borrowing for purposes of Sections 4, 5 or 6). (d) Notwithstanding anything to the contrary contained in any Loan Document, if the applicable Borrower or, if such Borrower is a Subsidiary Borrower, the Parent Borrower, on behalf of such Borrower, shall have failed, for any reason, to elect a Eurodollar Advance or Core Currency Euro Advance, as the case may be, under Sections 2.3 or 3.3, as the case may be, in connection with any borrowing of new Loans or expiration of a Euro Interest Period with respect to any existing Eurodollar Advance or Core Currency Euro Advance, as the case may be, the amount of the Loans subject to such borrowing or such existing Eurodollar Advance or Core Currency Euro Advance, as the case may be, shall, except as otherwise provided in Section 3.7, thereafter be (i) in the case of a Eurodollar Advance, an ABR Advance, and (ii) in the case of a Core Currency Euro Advance, a new Core Currency Euro Advance in the same applicable Currency with a one month Euro Interest Period, in each case until such time, if any, as such Borrower shall elect a new Eurodollar Advance or Core Currency Euro Advance, as the case may be, pursuant to Section 3.3. (e) Neither Bid Loans nor Swing Line Loans may be converted. (f) At no time shall the aggregate outstanding number (whether as a result of borrowings or conversions), of (i) all Eurodollar Advances exceed ten, (ii) all 76

Core Currency Euro Advances exceed eight, and (iii) all Swing Line Interest Periods exceed three. 3.4. INDEMNIFICATION FOR LOSS Notwithstanding anything contained herein to the contrary, (i) if any Borrower shall fail for any reason to borrow or convert from or into any Fixed Rate Loan on the date specified therefor in the applicable Borrowing Request, Notice of Conversion, or Bid, as the case may be, or (ii) if any Fixed Rate Loan to such Borrower shall terminate for any reason prior to the last day of the Euro Interest Period, Bid Interest Period or Swing Line Interest Period, as the case may be, applicable thereto, or (iii) if such Fixed Rate Loan is repaid or prepaid, in whole or in part, for any reason prior to the last day of the Euro Interest Period, Bid Interest Period or Swing Line Interest Period, as the case may be, applicable thereto, such Borrower agrees to indemnify each applicable Lender or the Swing Line Lender, as the case may be, against, and to pay on demand directly to such Lender or the Swing Line Lender, as the case may be, the amount (calculated by such Lender or the Swing Line Lender, as the case may be, using any method chosen by it which is customarily used by it for such purpose) equal to any loss or out-of-pocket expense (excluding loss of margin) suffered by such Lender or the Swing Line Lender, as the case may be, as a result of such failure to borrow or convert or such termination, repayment or prepayment, including any loss, cost or expense suffered by such Lender or the Swing Line Lender, as the case may be, in liquidating or employing deposits acquired to fund or maintain the funding of its Fixed Rate Loans to such Borrower, or redeploying funds prepaid or repaid, in amounts which correspond to such Fixed Rate Loans, and any internal processing charge customarily charged by such Lender or the Swing Line Lender, as the case may be, in connection therewith. 3.5. CAPITAL ADEQUACY If the amount of capital required to be maintained by any Lender, the Issuing Bank or the Swing Line Lender, as the case may be, or any Person directly or indirectly owning or controlling such Lender, the Issuing Bank or the Swing Line Lender, as the case may be (each a "CONTROL PERSON"), shall be affected by the occurrence of a Regulatory Change and such Lender, the Issuing Bank or the Swing Line Lender, as the case may be, shall have determined that such Regulatory Change shall have had or will thereafter have the effect of reducing (i) the rate of return on capital of such Lender, the Issuing Bank, the Swing Line Lender or such Control Person, as the case may be, or (ii) the asset value to such Lender, the Issuing Bank, the Swing Line Lender or such Control Person, as the case may be, of the Loans, Letters of Credit, Revolving Credit Commitments, Letter of Credit Commitment or Swing Line Commitment made or maintained by such Lender, the Issuing Bank or the Swing Line Lender, as the case may be, to a level below that which such Lender, the Issuing Bank, the Swing Line Lender or such Control Person, as the case may be, could have achieved or would thereafter be able to achieve but for such Regulatory Change (after taking into account its policies 77

regarding capital adequacy) by an amount deemed by such Lender, the Issuing Bank or the Swing Line Lender, as the case may be, to be material to such Lender, the Issuing Bank, the Swing Line Lender or such Control Person, as the case may be, then the Borrowers severally agree to pay to such Lender, the Issuing Bank, the Swing Line Lender or such Control Person, as the case may be, within ten days after demand by such Lender, the Issuing Bank or the Swing Line Lender, such additional amount or amounts as shall be sufficient to compensate such Lender, the Issuing Bank, the Swing Line Lender or such Control Person, as the case may be, for such reduction (which demand shall be accompanied by a statement setting forth the calculations of such additional amount or amounts which statement shall be conclusive absent manifest error). 3.6. REIMBURSEMENT FOR INCREASED COSTS If any Lender, the Issuing Bank or the Swing Line Lender, as the case may be, shall determine that a Regulatory Change does or shall impose, modify or make applicable any reserve, special deposit, compulsory loan, assessment, increased cost or similar requirement against assets held by, or deposits of, or advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of such Lender in respect of its Fixed Rate Loans or Letter of Credit, as the case may be, which is not otherwise included in the determination of a Eurodollar Rate, Core Currency Euro Rate, Bid Rate or Negotiated Rate, as the case may be, and the result of any of the foregoing is to increase the cost to such Lender, the Issuing Bank or the Swing Line Lender, as the case may be, of making, renewing, converting or maintaining its Fixed Rate Loans or Letters of Credit, as the case may be, or its commitment to make such Fixed Rate Loans or the Letters of Credit, as the case may be, or to reduce any amount receivable under the Loan Documents in respect of its Fixed Rate Loans or Letters of Credit, as the case may be, then, in any such case, the Borrowers severally agree to pay such Lender, the Issuing Bank or the Swing Line Lender, as the case may be, within ten days after demand therefor, such additional amounts as is sufficient to compensate such Lender, the Issuing Bank or the Swing Line Lender, as the case may be, for such additional cost or reduction in such amount receivable which it deems to be material as determined by it (which demand shall be accompanied by a statement setting forth the calculations of such additional amounts which statement shall be conclusive absent manifest error). 3.7. ILLEGALITY OF FUNDING Notwithstanding any other provision hereof, if any Lender or the Swing Line Lender, as the case may be, shall reasonably determine that any law, regulation, treaty or directive, or any change therein or in the interpretation or application thereof, shall make it unlawful for such Lender or the Swing Line Lender, as the case may be, to make or maintain any Fixed Rate Loan as contemplated by this Agreement, such Lender or the Swing Line Lender, as the case may be, shall promptly notify the Parent Borrower and the Administrative Agent thereof, and (i) the commitment or other obligation of such Lender or the Swing Line Lender, as the case may be, to make such Fixed Rate Loans or 78

convert ABR Advances to Eurodollar Advances or Core Currency Euro Advances to new Core Currency Euro Advances, as the case may be, shall forthwith be suspended, (ii) such Lender or the Swing Line Lender, as the case may be, shall fund its portion of each requested Eurodollar Advance as an ABR Advance, (iii) such Lender's or the Swing Line Lender's, as the case may be, Loans then outstanding as such Eurodollar Advances, if any, shall be converted automatically to an ABR Advance on the last day of the then current Euro Interest Period applicable thereto or at such earlier time as may be required, and (iv) in the case of each Core Currency Euro Advance, each Bid Loan and each Swing Line Loan, the applicable Borrower shall take such action as such Lender or the Swing Line Lender, as the case may be, may reasonably request with a view to minimizing the obligations of such Borrower under Section 3.4. If the commitment of any Lender or the Swing Line Lender, as the case may be, with respect to Fixed Rate Loans is suspended pursuant to this Section and such Lender shall have obtained actual knowledge that it is once again legal for such Lender or the Swing Line Lender, as the case may be, to make or maintain Fixed Rate Loans, such Lender or the Swing Line Lender, as the case may be, shall promptly notify the Administrative Agent and the Parent Borrower thereof and, upon receipt of such notice by each of the Administrative Agent and the Parent Borrower, such Lender's or the Swing Line Lender's, as the case may be, commitment to make or maintain Fixed Rate Loans shall be reinstated. 3.8. SUBSTITUTED INTEREST RATE In the event that (i) the Administrative Agent or BNY shall have determined (which determination shall be conclusive and binding upon the Borrowers) that by reason of circumstances affecting the interbank market either adequate or reasonable means do not exist for ascertaining the Eurodollar Rate or Core Currency Euro Rate, as the case may be, applicable pursuant to Section 3.1 or (ii) the Required Lenders shall have notified the Administrative Agent that they have determined (which determination shall be conclusive and binding on the Borrowers) that the applicable Eurodollar Rate or Core Currency Euro Rate, as the case may be, will not adequately and fairly reflect the cost to such Lenders of maintaining or funding loans bearing interest based on such Eurodollar Rate or Core Currency Euro Rate, as the case may be, with respect to any portion of the Loans that any Borrower has requested be made as Eurodollar Advances or Core Currency Euro Advances, as the case may be, or Eurodollar Advances or Core Currency Euro Advances, as the case may be, that will result from the requested conversion of any portion of the Advances into or of Eurodollar Advances or Core Currency Euro Advances, as the case may be (each an "AFFECTED ADVANCE"), the Administrative Agent shall promptly notify the Parent Borrower and the Lenders (by telephone or otherwise, to be promptly confirmed in writing) of such determination, on or, to the extent practicable, prior to the requested Borrowing Date or Conversion Date for such Affected Advances. If the Administrative Agent shall give such notice, (a) in the case of Eurodollar Advances, (A) such Affected Advances shall be made as ABR Advances, (B) the Advances (or any portion thereof) that were to have been converted to Affected Advances shall be converted to ABR Advances, and (C) any outstanding 79

Affected Advances shall be converted, on the last day of the then current Euro Interest Period with respect thereto, to ABR Advances, and (b) in the case of Core Currency Euro Advances, the interest rate for such Affected Advances shall be determined pursuant to clause (a)(iii) of the definition of Core Currency Euro Rate. Until any notice under clause (i) or (ii), as the case may be, of this Section has been withdrawn by the Administrative Agent (by notice to the Parent Borrower promptly upon either (1) the Administrative Agent having determined that such circumstances affecting the interbank market no longer exist and that adequate and reasonable means do exist for determining the Eurodollar Rate or Core Currency Euro Rate, as the case may be, pursuant to Section 3.1 or (2) the Administrative Agent having been notified by such Required Lenders that circumstances no longer render the Advances (or any portion thereof) Affected Advances, (x) no further Eurodollar Advances shall be required to be made by the Lenders, (y) no Borrower shall have the right to convert all or any portion of the Loans to or as Eurodollar Advances, and (z) the interest rate for Core Currency Euro Advances shall be determined pursuant to clause (a)(iii) of the definition of Core Currency Euro Rate. 3.9. TAXES (a) PAYMENTS TO BE FREE AND CLEAR. Subject to Sections 3.9(d), 3.9(e) and 3.9(f), all payments by each Credit Party under the Loan Documents shall be made free and clear of, and without any deduction or withholding for, any Indemnified Tax. If any Credit Party or any other Person is required by any law, rule, regulation, order, directive, treaty or guideline to make any deduction or withholding (which deduction or withholding would constitute an Indemnified Tax) from any amount required to be paid by any Credit Party to or on behalf of any Indemnified Tax Person under any Loan Document (each a "REQUIRED PAYMENT"), then: (i) such Credit Party shall notify the Administrative Agent and such Indemnified Tax Person of any such requirement or any change in any such requirement as soon as such Credit Party becomes aware thereof; (ii) such Credit Party shall pay such Indemnified Tax prior to the date on which penalties attach thereto, such payment to be made (to the extent that the liability to pay is imposed on such Credit Party) for its own account or (to the extent that the liability to pay is imposed on such Indemnified Tax Person) on behalf and in the name of such Indemnified Tax Person; (iii) such Credit Party shall pay to such Indemnified Tax Person an additional amount such that such Indemnified Tax Person shall receive on the due date therefor an amount equal to the Required Payment had no such deduction or withholding been required; and (iv) such Credit Party shall, within 30 days after paying such Indemnified Tax, deliver to the Administrative Agent and such Indemnified Tax 80

Person satisfactory evidence of such payment to the relevant Governmental Authority. (b) OTHER INDEMNIFIED TAXES. If any Indemnified Tax Person or any affiliate thereof is required by any law, rule, regulation, order, directive, treaty or guideline to pay any Indemnified Tax (excluding an Indemnified Tax which is subject to Section 3.9(a)) with respect to any sum paid or payable by any Credit Party to such Indemnified Tax Person under the Loan Documents, then, within five days after such Indemnified Tax Person shall have notified such Credit Party thereof (which notice shall be accompanied by a statement setting forth the reasonable calculation thereof), such Credit Party shall pay to such Indemnified Tax Person the amount of such Indemnified Tax. (c) TAX ON INDEMNIFIED TAXES. If any amounts are payable by any Credit Party in respect of Indemnified Taxes pursuant to Section 3.9(a) or (b), such Credit Party agrees to pay to the applicable Indemnified Tax Person, within five days of written request therefor (which request shall set forth the reasonable calculations thereof), an amount equal to all Taxes imposed with respect to such amounts as such Indemnified Tax Person shall determine in good faith are payable by such Indemnified Tax Person or any affiliate thereof in respect of such amounts and in respect of any amounts paid to or on behalf of such Indemnified Tax Person pursuant to this Section 3.9(c). (d) EXCEPTION FOR EXISTING TAXES. No amount shall be required to be paid to any Indemnified Tax Person under Section 3.9(a) or (b) with respect to any Indemnified Tax to the extent that such Indemnified Tax would have been required to have been paid under any law, rule, regulation, order, directive, treaty or guideline in effect on (i) the date of the applicable Bid, in the case of any Bid Loan, (ii) the date of the applicable Borrowing Request, in the case of any Swing Line Loan, and (iii) the Relevant Date, in all other cases. (e) U.S. TAX CERTIFICATES. Each Lender that is organized under the laws of any jurisdiction other than the United States or any political subdivision thereof shall deliver to the Administrative Agent for transmission to the Parent Borrower, on or prior to the Relevant Date, and at such other times, as may be necessary in the determination of the Parent Borrower, any other Credit Party or the Administrative Agent (each in the reasonable exercise of its discretion), such certificates, documents or other evidence, properly completed and duly executed by such Lender (including Internal Revenue Service Form 1001 or Form 4224 (or, in each case, any equivalent or successor form)) to establish that such Lender is not subject to deduction or withholding of United States federal income tax under Section 1441 or 1442 of the Code or otherwise (or under any comparable provisions of any successor statute) with respect to any payments to such Lender of principal, interest, fees or other amounts payable under the Loan Documents. No Credit Party shall be required to pay any additional amount to any such Lender under Section 3.9(a)(iii) if such Lender shall have failed to satisfy the requirements of the 81

immediately preceding sentence; provided that, if such Lender shall have satisfied such requirements on the Relevant Date, nothing in this Section 3.9(e) shall relieve any Credit Party of its obligation to pay any additional amounts pursuant to Section 3.9(a)(iii) in the event that, as a result of any change in applicable law (including any change in the interpretation thereof), such Lender is no longer properly entitled to deliver certificates, forms, documents or other evidence at a subsequent date establishing the fact that such Lender is not subject to deduction or withholding as described in the immediately preceding sentence. (f) OTHER TAX CERTIFICATES. Each Indemnified Tax Person agrees to use reasonable efforts to deliver to any Credit Party or the Administrative Agent, promptly upon any reasonable request therefor from time to time by such Credit Party or the Administrative Agent, such certificates, forms, documents and information as may be required by applicable law, regulation, order, directive, guideline or treaty from time to time and to file all appropriate forms to obtain a certificate, form or other appropriate documents from the appropriate Governmental Authorities to establish that payments made in respect of any Alternate Currency Loan by such Credit Party can be made without (or at a reduced rate of) deduction or withholding of Indemnified Taxes, PROVIDED, HOWEVER, that if such Indemnified Tax Person is or becomes unable by virtue of any change in applicable law, regulation or treaty, to establish such exemption or reduction, such Credit Party shall nonetheless remain obligated under Section 3.9(a) to pay the amounts described therein, and PROVIDED FURTHER that no Indemnified Tax Person shall be required to take any action under this Section 3.9(f) which, in the sole discretion of such Indemnified Tax Person, would cause such Indemnified Tax Person or any affiliate thereof to suffer a material economic, legal or regulatory disadvantage. (g) OTHER TAXES. Each Credit Party agrees to pay any current or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies that arise from any payment made hereunder or from the execution, delivery or registration of, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, the Loan Documents or otherwise with respect to, the Loan Documents. 3.10. OPTION TO FUND Each Lender and the Swing Line Lender has indicated that, if any Borrower requests a Eurodollar Advance, a Core Currency Euro Advance or a Swing Line Loan, or if such Lender makes a Bid Loan to any Borrower, as the case may be, such Lender or the Swing Line Lender, as the case may be, may wish to purchase one or more deposits in order to fund or maintain its funding of its Commitment Percentage of such Eurodollar Advance or Core Currency Euro Advance, its Bid Loan or its Swing Line Loan, as the case may be, during the Euro Interest Period, Bid Interest Period or Swing Line Interest Period, as the case may be, applicable thereto; it being understood that the provisions of this Agreement relating to such funding are included only for the 82

purpose of determining the rate of interest to be paid in respect of such Eurodollar Advance, Core Currency Euro Advance, Bid Loan or Swing Line Loan, as the case may be, and any amounts owing under Sections 3.4 and 3.6. Each Lender and the Swing Line Lender shall be entitled to fund and maintain its funding of all or any part of each Eurodollar Advance, each Core Currency Euro Advance, each Bid Loan and each Swing Line Loan in any manner it sees fit, but all such determinations under Sections 3.4 and 3.6 shall be made as if each Lender and the Swing Line Lender had actually funded and maintained its Commitment Percentage of each such Eurodollar Advance or such Core Currency Euro Advance, or the amount of its Bid Loan or Swing Line Loan, as the case may be, during the applicable Euro Interest Period, Bid Interest Period or Swing Line Interest Period, as the case may be, through the purchase of deposits in an amount equal to the amount of its Commitment Percentage of such Eurodollar Advance or such Core Currency Euro Advance, or the amount of its Bid Loan or Swing Line Loan, as the case may be, having a maturity corresponding to such Euro Interest Period, Bid Interest Period or Swing Line Interest Period, as the case may be. Any Lender or the Swing Line Lender, as the case may be, may fund its Commitment Percentage of each Eurodollar Advance or Core Currency Euro Advance, or each Bid Loan or Swing Line Loan, as the case may be, from or for the account of any branch, office, affiliate, or correspondent bank of such Lender or the Swing Line Lender, as the case may be, as such Lender or the Swing Line Lender, as the case may be, may choose from time to time. 3.11. CHANGES OF LENDING OFFICES (a) With respect to any Loan of any Lender or the Swing Line Lender, or any Letter of Credit, as the case may be, such Lender, the Swing Line Lender or the Issuing Bank, as the case may be, agrees that upon the occurrence of any event giving rise to the operation of Section 3.4, 3.5, 3.6, 3.7 or 3.9 with respect to such Loan or such Letter of Credit, as the case may be, it will, if requested by the applicable Borrower or, if such Borrower is a Subsidiary Borrower, the Parent Borrower, on behalf of such Borrower, use reasonable efforts (subject to overall policy considerations of such Lender, the Swing Line Lender or the Issuing Bank, as the case may be) to designate another office of such Lender, the Swing Line Lender or the Issuing Bank, as the case may be, for such Loan or such Letter of Credit, as the case may be, affected by such event, provided that such designation is made on such terms that such Lender, the Swing Line Lender or the Issuing Bank, as the case may be, suffers no economic, legal or regulatory disadvantage, with the object of avoiding the consequence of the event giving rise to the operation of such Section. Nothing in this Section shall affect or postpone any of the obligations of any Borrower or the right of any Lender, the Swing Line Lender or the Issuing Bank, as the case may be, provided in Sections 3.4, 3.5, 3.6, 3.7 and 3.9. (b) Each of the Lenders, the Swing Line Lender and the Issuing Bank shall have the right at any time and from time to time to transfer any of its Loans to a different office, affiliate or 83

subsidiary thereof, provided that it shall promptly notify the Administrative Agent and the Parent Borrower of any such change of office, affiliate or subsidiary, PROVIDED, HOWEVER, that such Lender, the Swing Line Lender or the Issuing Bank, as the case may be, shall not be entitled to receive any greater amount under Sections 3.4, 3.5, 3.6, 3.7 or 3.9 as a result of such transfer than it would be entitled to immediately prior thereto unless such claim would have arisen even if such transfer had not occurred. 3.12. REPLACEMENT OF LENDERS Notwithstanding the foregoing, if (i) any Lender shall request compensation pursuant to Section 3.5 or 3.6, (ii) any Lender shall give any notice to the Parent Borrower or the Administrative Agent pursuant to Section 3.7, or (iii) any Borrower shall be required to pay any additional amounts pursuant to Section 3.9 in respect of any Lender, then, in each such case, the Parent Borrower may require that such Lender transfer all of its right, title and interest under the Loan Documents to any lender identified by the Parent Borrower (a "PROPOSED LENDER") if such Proposed Lender agrees to assume all of the obligations of such Lender for consideration equal to the outstanding principal amount of such Lender's Loans and all unreimbursed sums paid by such Lender under Sections 2.2(d) and 2.9(b), together with interest thereon to the date of such transfer and all other amounts payable under the Loan Documents to such Lender on or prior to the date of such transfer (including any fees accrued hereunder and any amounts which would be payable under Section 3.4 as if all of such Lender's Loans were being prepaid in full on such date). Subject to the execution and delivery of an Assignment and Acceptance Agreement and such other documents as such Lender may reasonably require, and the satisfaction of all of the other terms and conditions of Section 11.6, such Proposed Lender shall be a "LENDER" for all purposes hereunder. Without prejudice to the survival of any other agreement of the Borrowers under the Loans Documents, the agreements of the Borrowers contained in Sections 3.4, 3.5, 3.6, 11.5 and 11.7 (without duplication of any payments made to such Lender by any Borrower or the Proposed Lender) shall survive for the benefit of any Lender replaced under this Section 3.12 with respect to the time prior to such replacement. 4. REPRESENTATIONS AND WARRANTIES In order to induce the Administrative Agent and the Lenders to enter into this Agreement, the Lenders to make the Revolving Credit Loans, the Issuing Bank to issue the Letters of Credit and the Lenders to participate therein, and the Swing Line Lender to make the Swing Line Loans and the Lenders to participate therein, the Parent Borrower makes the following representations and warranties to the Administrative Agent, the Issuing Bank, the Swing Line Lender and each Lender: 4.1. SUBSIDIARIES; CAPITALIZATION As of the Effective Date, the Parent Borrower has only the Subsidiaries set forth on, and the authorized, issued and outstanding Capital Stock of the Parent Borrower 84

and each such Subsidiary is as set forth on, Schedule 4.1. Except as set forth on Schedule 4.1, the shares of, or partnership or other interests in, each Subsidiary of the Parent Borrower are owned beneficially and of record by the Parent Borrower or another Subsidiary of the Parent Borrower, are free and clear of all Liens (other than Permitted Liens) and are duly authorized, validly issued, fully paid and nonassessable. As of the Effective Date, except as set forth on Schedule 4.1, (i) neither the Parent Borrower nor any of its Subsidiaries has issued any securities convertible into, or options or warrants for, any common or preferred equity securities thereof, (ii) there are no agreements, voting trusts or understandings binding upon the Parent Borrower or any of its Subsidiaries with respect to the voting securities of the Parent Borrower or any of its Subsidiaries or affecting in any manner the sale, pledge, assignment or other disposition thereof, including any right of first refusal, option, redemption, call or other right with respect thereto, whether similar or dissimilar to any of the foregoing, and (iii) all of the outstanding Capital Stock of each Subsidiary of the Parent Borrower is owned by the Parent Borrower or another Subsidiary of the Parent Borrower. 4.2. EXISTENCE AND POWER Each of the Parent Borrower and its Subsidiaries is duly organized or formed and validly existing in good standing under the laws of the jurisdiction of its formation, has all requisite power and authority to own its Property and to carry on its business as now conducted, and is in good standing and authorized to do business in each jurisdiction in which the nature of the business conducted therein or the Property owned by it therein makes such qualification necessary, except where such failure to qualify could not reasonably be expected to have a Material Adverse Effect. 4.3. AUTHORITY AND EXECUTION Each of the Parent Borrower and each of its Subsidiaries has full legal power and authority to enter into, execute, deliver and perform the terms of the Loan Documents to which it is a party all of which have been duly authorized by all proper and necessary corporate, partnership or other applicable action and are in full compliance with its Organizational Documents. The Parent Borrower and each of its Subsidiaries has duly executed and delivered the Loan Documents to which it is a party. 4.4. BINDING AGREEMENT The Loan Documents constitute the valid and legally binding obligations of each of the Parent Borrower and its Subsidiaries, in each case to the extent it is a party thereto, enforceable in accordance with their respective terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors' rights generally. 85

4.5. LITIGATION Except as set forth on Schedule 4.5, there are no actions, suits or proceedings at law or in equity or by or before any Governmental Authority (whether purportedly on behalf of the Parent Borrower or any of its Subsidiaries) pending or, to the knowledge of the Parent Borrower, threatened against the Parent Borrower or any of its Subsidiaries or maintained by the Parent Borrower or any of its Subsidiaries or which may affect the Property of the Parent Borrower or any of its Subsidiaries or any of their respective Properties or rights, which (i) could reasonably be expected to have a Material Adverse Effect, (ii) call into question the validity or enforceability of, or otherwise seek to invalidate, any Loan Document, or (iii) might, individually or in the aggregate, materially and adversely affect any of the transactions contemplated by any Loan Document. 4.6. REQUIRED CONSENTS Except for information filings required to be made in the ordinary course of business which are not a condition to the performance by the Parent Borrower or any of its Subsidiaries under the Loan Documents to which it is a party, no consent, authorization or approval of, filing with, notice to, or exemption by, stockholders or holders of any other equity interest, any Governmental Authority or any other Person, which has not already been obtained or made, is required to authorize, or is required in connection with the execution, delivery or performance of, the Loan Documents to which the Parent Borrower or any of its Subsidiaries is a party, or is required as a condition to the validity or enforceability of the Loan Documents to which any of the same is a party. Each Borrower, prior to each borrowing by it hereunder in any jurisdiction, has obtained all necessary approvals and consents of, and has filed or caused to be filed all reports, applications, documents, instruments and information required to be filed pursuant to all applicable laws, rules, regulations and requests of, all Governmental Authorities in connection with such borrowing in such jurisdiction. 4.7. ABSENCE OF DEFAULTS; NO CONFLICTING AGREEMENTS (a) None of the Parent Borrower or any of its Subsidiaries is in default under any mortgage, indenture, contract or agreement to which it is a party or by which it or any of its Property is bound, the effect of which default could reasonably be expected to have a Material Adverse Effect. The execution, delivery or carrying out of the terms of the Loan Documents will not constitute a default under, or result in the creation or imposition of, or obligation to create, any Lien upon any Property of the Parent Borrower or any of its Subsidiaries or result in a breach of or require the mandatory repayment of or other acceleration of payment under or pursuant to the terms of any such mortgage, indenture, contract or agreement. (b) None of the Parent Borrower or any of its Subsidiaries is in default with respect to any judgment, order, writ, injunction, decree or decision of any 86

Governmental Authority which default could reasonably be expected to have a Material Adverse Effect. 4.8. COMPLIANCE WITH APPLICABLE LAWS Each of the Parent Borrower and its Subsidiaries is complying in all material respects with all statutes, regulations, rules and orders of all Governmental Authorities which are applicable to it, a violation of which could reasonably be expected to have a Material Adverse Effect. 4.9. TAXES Each of the Parent Borrower and each of its Subsidiaries has filed or caused to be filed all tax returns required to be filed and has paid, or has made adequate provision for the payment of, all taxes shown to be due and payable on said returns or in any assessments made against it (other than those being contested as required under Section 7.4) which would be material to the Parent Borrower or any of its Subsidiaries, and no tax Liens have been filed with respect thereto. The charges, accruals and reserves on the books of the Parent Borrower and each of its Subsidiaries with respect to all taxes are, to the best knowledge of the Parent Borrower, adequate for the payment of such taxes, and the Parent Borrower knows of no unpaid assessment which is due and payable against the Parent Borrower or any of its Subsidiaries or any claims being asserted which could reasonably be expected to have a Material Adverse Effect, except such thereof as are being contested as required under Section 7.4, and for which adequate reserves have been set aside in accordance with GAAP. 4.10. GOVERNMENTAL REGULATIONS Neither the Parent Borrower, any of its Subsidiaries nor any Person controlled by, controlling, or under common control with, the Parent Borrower or any of its Subsidiaries, is subject to regulation under the Public Utility Holding Company Act of 1935, as amended, the Federal Power Act, as amended, or the Investment Company Act of 1940, as amended, or is subject to any statute or regulation which prohibits or restricts the incurrence of Indebtedness, including statutes or regulations relative to common or contract carriers or to the sale of electricity, gas, steam, water, telephone, telegraph or other public utility services. 4.11. FEDERAL RESERVE REGULATIONS; USE OF LOAN PROCEEDS Neither the Parent Borrower nor any of its Subsidiaries is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any Margin Stock. After giving effect to the making of each Loan and each Letter of Credit, Margin Stock will constitute less than 25% of the assets (as determined by any reasonable method) of the Parent Borrower and its Subsidiaries. 87

4.12. PLANS Each Employee Benefit Plan is in compliance with ERISA and the Code, where applicable, in all material respects. As of the Effective Date, (i) the amount of all Unfunded Pension Liabilities under the Pension Plans, excluding any plan which is a Multiemployer Plan, does not exceed $50,000, and (ii) the amount of the aggregate Unrecognized Retiree Welfare Liability under all applicable Employee Benefit Plans does not exceed $50,000. The Parent Borrower and each of its Subsidiaries and ERISA Affiliates has complied with the requirements of Section 515 of ERISA with respect to each Pension Plan which is a Multiemployer Plan. As of the Effective Date, the Parent Borrower and its Subsidiaries and ERISA Affiliates have no liability under Section 4201 or 4204 of ERISA (including the obligation to satisfy secondary liability as a result of purchaser default) and the aggregate potential annual withdrawal liability payments, as determined in accordance with Title IV of ERISA, of the Parent Borrower and its Subsidiaries and ERISA Affiliates with respect to all Pension Plans which are Multiemployer Plans is approximately $50,000. The Parent Borrower and its Subsidiaries and ERISA Affiliates have, as of the Effective Date, made all contributions or payments to or under each such Pension Plan required by law or the terms of such Pension Plan or any contract or agreement with respect thereto. No material liability to the PBGC has been, or is expected by the Parent Borrower, any of its Subsidiaries or any ERISA Affiliate to be, incurred by the Parent Borrower, any such Subsidiary or any ERISA Affiliate. Liability, as referred to in this Section includes any joint and several liability. Each Employee Benefit Plan which is a group health plan within the meaning of Section 5000(b)(1) of the Code is in material compliance with the continuation of health care coverage requirements of Section 4980B of the Code. 4.13. FINANCIAL STATEMENTS The Parent Borrower has heretofore delivered to the Administrative Agent and the Lenders copies of its Form 10K for the fiscal year ending December 28, 1996, containing the audited Consolidated Balance Sheets of the Parent Borrower and its Subsidiaries as of December 28, 1996, and the related Consolidated Statements of Operations, Stockholder's Equity and Cash Flows for the such fiscal year, and its Form 10Q for the fiscal quarter ended March 29, 1997, containing the unaudited Consolidated Balance Sheet of the Parent Borrower and its Subsidiaries for such fiscal quarter, together with the related Consolidated Statements of Operations and Cash Flows for such fiscal quarter (with the applicable related notes and schedules, the "FINANCIAL STATEMENTS"). The Financial Statements fairly present the Consolidated financial condition and results of the operations of the Parent Borrower and its Subsidiaries as of the dates and for the periods indicated therein and have been prepared in conformity with GAAP. Except as reflected in the Financial Statements or in the footnotes thereto, neither the Parent Borrower nor any of its Subsidiaries has any obligation or liability of any kind (whether fixed, accrued, Contingent, unmatured or otherwise) which, in accordance with GAAP, should have been shown in the Financial Statements and was not. Since December 28, 88

1996, the Parent Borrower and each of its Subsidiaries has conducted its business only in the ordinary course, and there has been no Material Adverse Change. 4.14. PROPERTY Each of the Parent Borrower and each of its Subsidiaries has good and marketable title to, or a valid leasehold interest in, all of its real Property, and is the owner of, or has a valid lease of, all personal property, in each case which is material to the Parent Borrower and its Subsidiaries, taken as a whole, subject to no Liens, except such Permitted Liens. All leases of Property to the Parent Borrower or any of its Subsidiaries are in full force and effect, the Parent Borrower or such Subsidiary, as the case may be, enjoys quiet and undisturbed possession under all leases of real property and neither the Parent Borrower nor any of its Subsidiaries is in default beyond any applicable grace period of any provision thereof, the effect of which could reasonably be expected to have a Material Adverse Effect. 4.15. AUTHORIZATIONS Each of the Parent Borrower and each of its Subsidiaries possesses or has the right to use all franchises, licenses and other rights as are material and necessary for the conduct of its business, and with respect to which it is in compliance, with no known conflict with the valid rights of others which could reasonably be expected to have a Material Adverse Effect. No event has occurred which permits or, to the best knowledge of the Parent Borrower, after notice or the lapse of time or both, or any other condition, could reasonably be expected to permit, the revocation or termination of any such franchise, license or other right which revocation or termination could reasonably be expected to have a Material Adverse Effect. 4.16. ENVIRONMENTAL MATTERS Neither the Parent Borrower nor any of its Subsidiaries (i) has received written notice or otherwise learned of any claim, demand, action, event, condition, report or investigation indicating or concerning any potential or actual liability which individually or in the aggregate could reasonably be expected to have a Material Adverse Effect, arising in connection with (a) any non-compliance with or violation of the requirements of any applicable federal, state, local or foreign environmental health or safety statute or regulation, or (b) the release or threatened release of any toxic or hazardous waste, substance or constituent, or other substance into the environment, (ii) to the best knowledge of the Parent Borrower, has any threatened or actual liability in connection with the release or threatened release of any toxic or hazardous waste, substance or constituent, or other substance into the environment which individually or in the aggregate could reasonably be expected to have a Material Adverse Effect, (iii) has received notice of any federal, state, local or foreign investigation evaluating whether any remedial action is needed to respond to a release or threatened release of any toxic or hazardous waste, substance or constituent or other substance into the environment for 89

which the Parent Borrower or any of its Subsidiaries is or would be liable, which liability would reasonably be expected to have a Material Adverse Effect, or (iv) has received notice that the Parent Borrower or any of its Subsidiaries is or may be liable to any Person under the Comprehensive Environmental Response, Compensation and Liability Act, as amended, 42 U.S.C. Section 9601 et seq., or any analogous state law, which liability would reasonably be expected to have a Material Adverse Effect. The Parent Borrower and each of its Subsidiaries is in compliance with the financial responsibility requirements of federal, state, local and foreign environmental laws to the extent applicable, including those contained in 40 C.F.R., parts 264 and 265, subpart H, and any analogous state law, except in those cases in which the failure so to comply would not reasonably be expected to have a Material Adverse Effect. 4.17. ABSENCE OF CERTAIN RESTRICTIONS No indenture, certificate of designation for preferred stock, agreement or instrument to which the Parent Borrower or any of its Subsidiaries is a party (other than this Agreement), prohibits or limits in any way, directly or indirectly the ability of any Subsidiary of the Parent Borrower to make Restricted Payments or repay any Indebtedness to the Parent Borrower or to another Subsidiary of the Parent Borrower. 4.18. NO MISREPRESENTATION No representation or warranty contained in any Loan Document and no certificate or report from time to time furnished by the Parent Borrower or any of its Subsidiaries in connection with the transactions contemplated thereby, contains or will contain a misstatement of material fact or omits or will omit to state a material fact required to be stated in order to make the statements therein contained not misleading in the light of the circumstances under which made, provided that any projections or pro-forma financial information contained therein are based upon good faith estimates and assumptions believed by the Parent Borrower to be reasonable at the time made, it being recognized by the Agents and the Lenders that such projections as to future events are not to be viewed as facts, and that actual results during the period or periods covered thereby may differ from the projected results. 5. CONDITIONS OF LENDING - THE FIRST BORROWING DATE In addition to the conditions precedent set forth in Section 6, the obligation of each Lender to make Revolving Credit Loans and the Issuing Bank to issue Letters of Credit on the first Borrowing Date shall be subject to the fulfillment of the following conditions precedent: 90

5.1. EVIDENCE OF ACTION The Administrative Agent shall have received a certificate, dated the first Borrowing Date, of the Secretary or Assistant Secretary or other analogous counterpart of each Credit Party (i) attaching a true and complete copy of the resolutions of its Managing Person and of all documents evidencing all necessary corporate, partnership or similar action (in form and substance satisfactory to the Administrative Agent) taken by it to authorize the Loan Documents to which it is a party and the transactions contemplated thereby, (ii) attaching a true and complete copy of its Organizational Documents, (iii) setting forth the incumbency of its officer or officers or other analogous counterpart who may sign the Loan Documents, including therein a signature specimen of such officer or officers, and (iv) attaching a certificate of good standing of the Secretary of State of the jurisdiction of its formation. 5.2. OPINIONS OF COUNSEL The Administrative Agent shall have received (i) an opinion of McGrath, North, Mullin & Kratz, P.C., counsel to the Parent Borrower and its Subsidiaries, dated the first Borrowing Date, substantially in the form of Exhibit F-1, and (ii) an opinion of Thomas P. Egan, corporate counsel of the Parent Borrower and its Subsidiaries, dated the first Borrowing Date, substantially in the form of Exhibit F-2. 5.3. OPINION OF SPECIAL COUNSEL The Administrative Agent shall have received an opinion of Special Counsel, dated the first Borrowing Date, substantially in the form of Exhibit G. 5.4. SUBSIDIARY GUARANTY Each of (a) American Lighting Standards Corporation, (b) Microflect Company, Inc., and (c) Valmont International Corp. shall have delivered to the Administrative Agent a guaranty, dated as of the Effective Date, substantially in the form of Exhibit R (as amended, supplemented or otherwise modified from time to time, the "SUBSIDIARY GUARANTY"). 5.5. FEES AND EXPENSES All fees payable to the Administrative Agent, the Issuing Bank, the Swing Line Lender and the Lenders on the first Borrowing Date shall have been paid, the fees and expenses of Special Counsel in connection with the preparation, negotiation and closing of the Loan Documents shall have been paid. 91

6. CONDITIONS OF LENDING - EACH BORROWING DATE The obligation of each Lender to make any Loan, the Swing Line Lender to make any Swing Line Loan, and the Issuing Bank to issue any Letter of Credit on any Borrowing Date shall be subject to the fulfillment of the following conditions precedent: 6.1. COMPLIANCE On each Borrowing Date and after giving effect to the Loans to be made thereon (i) there shall exist no Default, (ii) each of the representations and warranties contained in each Loan Document shall be true and correct with the same effect as though such representation and warranty had been made on such Borrowing Date, except to the extent such representation and warranty specifically relates to an earlier date, in which case such representation and warranty shall have been true and correct on and as of such earlier date, and (iii) each of the Parent Borrower and its Subsidiaries shall be in compliance with all of the terms, covenants and conditions of each Loan Document to which it is a party. Each borrowing by any Borrower shall constitute a certification by such Borrower and, if such Borrower is a Subsidiary Borrower, the Parent Borrower, and each request by the Parent Borrower for the issuance of a Letter of Credit shall constitute a certification by the Parent Borrower, as of such Borrowing Date that each of the foregoing matters is true and correct in all respects. 6.2. BORROWING REQUEST; LETTER OF CREDIT REQUEST; BID REQUEST With respect to the Loans to be made, and the Letters of Credit to be issued, on each Borrowing Date, the Administrative Agent shall have received, (i) in the case of Revolving Credit Loans or Swing Line Loans, a Borrowing Request, (ii) in the case of Letters of Credit, a Letter of Credit Request, and (iii) in the case Bid Loans, a Bid Request and such other documents required to be delivered pursuant to Section 2.4, in each case duly executed by the applicable Borrower or, if such Borrower is a Subsidiary Borrower, the Parent Borrower, on behalf of such Borrower. 6.3. LOAN CLOSINGS All documents required by the provisions of the Loan Documents to be executed or delivered to the Administrative Agent, the Issuing Bank, the Swing Line Lender or any Lender on or before the applicable Borrowing Date shall have been so executed and delivered on or before such Borrowing Date. 6.4. OTHER DOCUMENTS Each of the Administrative Agent, the Issuing Bank, the Swing Line Lender and the Lenders shall have received such other documents, each in form and substance reasonably satisfactory to it, as it shall reasonably require in connection with 92

the making of the Loans and the issuance of the Letters of Credit on such Borrowing Date. 7. AFFIRMATIVE COVENANTS The Parent Borrower agrees that, so long as this Agreement is in effect, any Loan or Reimbursement Obligation remains outstanding, or any other amount is owing under any Loan Document to any Lender, the Issuing Bank, the Swing Line Lender or the Administrative Agent, the Parent Borrower shall: 7.1. FINANCIAL STATEMENTS AND INFORMATION Maintain, and cause each of its Subsidiaries to maintain, a standard system of accounting in accordance with GAAP, and furnish or cause to be furnished to the Administrative Agent and each Lender: (a) COMPLIANCE CERTIFICATE. Within 45 days after the end of each of the first three fiscal quarters (90 days after the end of the last fiscal quarter), a Compliance Certificate, certified by a Financial Officer of the Parent Borrower. (b) FORM 10K. As soon as available, but in any event within 90 days after the end of each fiscal year of the Parent Borrower, a copy of the annual audited financial statements of the Parent Borrower and its Subsidiaries, prepared on a Consolidated basis in accordance with GAAP, as filed with the SEC. Such financial statements shall be certified without qualification by the Accountants, which certification shall (i) state that the audit by such Accountants was conducted in accordance with generally accepted auditing standards, (ii) state that such audit includes examining, on a test basis, evidence supporting the amounts and disclosures in such financial statements, and (iii) include the opinion of such Accountants that such financial statements present fairly, in all material respects, the financial position of the Parent Borrower and its Subsidiaries and the results of their operations and their cash flows for such fiscal year in conformity with GAAP, except as otherwise specified in such opinion. (c) FORM 10Q. As soon as available, but in any event within 45 days after the end of each fiscal quarter (except the last fiscal quarter) of each fiscal year of the Parent Borrower, copies of the unaudited financial statements of the Parent Borrower and its Subsidiaries, prepared on a Consolidated basis in accordance with GAAP, as filed with the SEC. (d) OTHER INFORMATION. Such other information as the Administrative Agent or any Lender may reasonably request from time to time. 93

7.2. CERTIFICATES; OTHER INFORMATION Furnish to the Administrative Agent and each Lender: (a) Prompt written notice if: (i) any Indebtedness of the Parent Borrower or any of its Subsidiaries in an aggregate amount in excess of $500,000 is declared or shall become due and payable prior to its stated maturity, or is called and not paid when due, (ii) the holders of any notes (other than any notes issued hereunder), certificate, security or other evidence of Indebtedness, or any obligees with respect to any other Indebtedness of the Parent Borrower or any of its Subsidiaries, have the right to declare Indebtedness in an aggregate amount in excess of $500,000 due and payable prior to its stated maturity, or (iii) there shall occur and be continuing a Default; (b) Prompt written notice of: (i) any citation, summons, subpoena, order to show cause or other document naming the Parent Borrower or any of its Subsidiaries a party to any proceeding before any Governmental Authority which could reasonably be expected to have a Material Adverse Effect or which calls into question the validity or enforceability of any of the Loan Documents, and include with such notice a copy of such citation, summons, subpoena, order to show cause or other document, (ii) any lapse or other termination of any material license, permit, franchise or other authorization issued to the Parent Borrower or any of its Subsidiaries by any Person or Governmental Authority, and (iii) any refusal by any Person or Governmental Authority to renew or extend any such material license, permit, franchise or other authorization, which lapse, termination, refusal or dispute could reasonably be expected to have a Material Adverse Effect; (c) Promptly upon becoming available, copies of all (i) regular, periodic or special reports, schedules and other material which the Parent Borrower or any of its Subsidiaries may now or hereafter be required to file with or deliver to any securities exchange or the SEC, and (ii) annual reports relating to the Parent Borrower or any of its Subsidiaries; (d) Prompt written notice in the event that the Parent Borrower, any of its Subsidiaries or any ERISA Affiliate knows, or has reason to know, that (i) any Termination Event with respect to a Pension Plan has occurred or will occur, (ii) any condition exists with respect to a Pension Plan which presents a material risk of termination of the Pension Plan, imposition of an excise tax, requirement to provide security to the Pension Plan or other liability on the Parent Borrower, any of its Subsidiaries or any ERISA Affiliate, (iii) the Parent Borrower, any of its Subsidiaries or any ERISA Affiliate has applied for a waiver of the minimum funding standard under Section 412 of the Code with respect to a Pension Plan, (iv) the aggregate amount of the Unfunded Pension Liabilities under all Pension Plans is in excess of $50,000, (v) the aggregate amount of Unrecognized Retiree 94

Welfare Liability under all applicable Employee Benefit Plans is in excess of $50,000, (vi) the Parent Borrower, any of its Subsidiaries or any ERISA Affiliate has engaged in a Prohibited Transaction with respect to an Employee Benefit Plan, (vii) the imposition of any tax under Section 4980B(a) of the Code or (viii) the assessment of a civil penalty under Section 502(c) of ERISA, together with a certificate of a Financial Officer of the Parent Borrower setting forth the details of such event and the action which the Parent Borrower, such Subsidiary or such ERISA Affiliate proposes to take with respect thereto, together with a copy of all notices and filings with respect thereto. (e) Prompt written notice in the event that Parent Borrower, any of its Subsidiaries or any ERISA Affiliate shall receive a demand letter from the PBGC notifying the Parent Borrower, such Subsidiary or such ERISA Affiliate of any final decision finding liability and the date by which such liability must be paid, together with a copy of such letter and a certificate of a Financial Officer of the Parent Borrower setting forth the action which the Parent Borrower, such Subsidiary or such ERISA Affiliate proposes to take with respect thereto. (f) Promptly upon the same becoming available, and in any event by the date such amendment is adopted, a copy of any Pension Plan amendment that the Parent Borrower, any of its Subsidiaries or any ERISA Affiliate proposes to adopt which would require the posting of security under Section 401(a)(29) of the Code, together with a certificate of a Financial Officer of the Parent Borrower setting forth the reasons for the adoption of such amendment and the action which the Parent Borrower, such Subsidiary or such ERISA Affiliate proposes to take with respect thereto. (g) As soon as possible and in any event by the tenth day after any required installment or other payment under Section 412 of the Code owed to a Pension Plan shall have become due and owing and remain unpaid a copy of the notice of failure to make required contributions provided to the PBGC by the Parent Borrower, any of its Subsidiaries or any ERISA Affiliate under Section 412(n) of the Code, together with a certificate of a Financial Officer setting forth the action which the Parent Borrower, such Subsidiary or such ERISA Affiliate proposes to take with respect thereto. (h) Such other information as the Administrative Agent or any Lender shall reasonably request from time to time. 7.3. LEGAL EXISTENCE Except as may be otherwise permitted by Sections 8.3, 8.4 and 8.5, maintain, and cause each of its Subsidiaries to maintain, its corporate, partnership or analogous existence, as the case may be, in good standing in the jurisdiction of its formation and in each other jurisdiction in which the failure so to do could reasonably be 95

expected to have a Material Adverse Effect, except that any Subsidiary of the Parent Borrower (other than an Active Subsidiary Borrower or a Guarantor) may fail to maintain its corporate, partnership or analogous existence, as the case may be, in good standing in any jurisdiction at any time, provided that such failure could not reasonably be expected to have a Material Adverse Effect. 7.4. TAXES Pay and discharge when due, and cause each of its Subsidiaries so to do, all Taxes upon or with respect to the Parent Borrower or such Subsidiary and all Taxes upon the income, profits and Property of the Parent Borrower and its Subsidiaries, which if unpaid, could reasonably be expected to have a Material Adverse Effect or become a Lien on Property of the Parent Borrower or such Subsidiary (other than a Permitted Lien), unless and to the extent only that such Taxes shall be contested in good faith and by appropriate proceedings diligently conducted by the Parent Borrower or such Subsidiary and provided that such reserve or other appropriate provision as shall be required by the Accountants in accordance with GAAP shall have been made therefor. 7.5. INSURANCE Maintain, and cause each of its Subsidiaries to maintain, with financially sound and reputable insurance companies insurance on all its Property in at least such amounts and against at least such risks (but including in any event public liability, product liability and business interruption coverage) as are usually insured against in the same general area by companies engaged in the same or a similar business; and furnish to the Administrative Agent, upon written request, full information as to the insurance carried. 7.6. PERFORMANCE OF OBLIGATIONS Pay and discharge when due, and cause each of its Subsidiaries so to do, all lawful Indebtedness, obligations and claims for labor, materials and supplies or otherwise which, if unpaid, might (i) have a Material Adverse Effect or (ii) become a Lien upon Property of the Parent Borrower or any of its Subsidiaries other than a Permitted Lien, unless and to the extent only that the validity of such Indebtedness, obligation or claim shall be contested in good faith and by appropriate proceedings diligently conducted and provided that the Parent Borrower shall give the Administrative Agent prompt notice of any such contest and that such reserve or other appropriate provision as shall be required by the Accountants in accordance with GAAP shall have been made therefor. 7.7. CONDITION OF PROPERTY At all times, maintain, protect and keep in good repair, working order and condition (ordinary wear and tear excepted), and cause each of its Subsidiaries so to do, 96

all Property necessary to the operation of the Parent Borrower's or such Subsidiary's business, except where the failure so to do could not reasonably be expected to have a Material Adverse Effect. 7.8. OBSERVANCE OF LEGAL REQUIREMENTS Observe and comply in all respects, and cause each of its Subsidiaries so to do, with all laws, ordinances, orders, judgments, rules, regulations, certifications, franchises, permits, licenses, directions and requirements of all Governmental Authorities, which now or at any time hereafter may be applicable to it, a violation of which could reasonably be expected to have a Material Adverse Effect, except such thereof as shall be contested in good faith and by appropriate proceedings diligently conducted by it, provided that the Parent Borrower shall give the Administrative Agent prompt notice of such contest and that such reserve or other appropriate provision as shall be required by the Accountants in accordance with GAAP shall have been made therefor. 7.9. INSPECTION OF PROPERTY; BOOKS AND RECORDS; DISCUSSIONS At all reasonable times, upon reasonable prior notice, permit representatives of the Administrative Agent, the Issuing Bank, the Swing Line Lender and each Lender to visit the offices of the Parent Borrower and each of its Subsidiaries, to examine the books and records thereof and Accountants' reports relating thereto, and to make copies or extracts therefrom, to discuss the affairs of the Parent Borrower and each such Subsidiary with the respective officers thereof, and to examine and inspect the Property of the Parent Borrower and each such Subsidiary. 7.10. AUTHORIZATIONS Maintain, and cause each of its Subsidiaries to maintain, in full force and effect, all material licenses, franchises, permits, licenses, authorizations and other rights as are necessary for the conduct of its business. 7.11. FINANCIAL COVENANTS (a) FIXED CHARGE COVERAGE RATIO. Maintain at all times during the periods set forth below, a Fixed Charge Coverage Ratio of not less than the ratios set forth below: 97

PERIOD RATIO ------ ----- Effective Date through June 1.65:1.00 30, 1999 July 1, 1999 through June 30, 1.85:1.00 2000 July 1, 2000 and thereafter 2.00:1.00. (b) LEVERAGE RATIO. Maintain at all times a Leverage Ratio of not more than 2.00:1.00. 7.12. SUBSIDIARIES (a) Except as may otherwise be permitted by Sections 7.3, 8.3, 8.4 and 8.5, at all times cause each Subsidiary Borrower and each Guarantor to be a direct or indirect wholly-owned Subsidiary of the Parent Borrower. (b) On or prior to each date hereafter upon which a Person shall have become a Material Subsidiary, cause such Subsidiary to become a party to the Subsidiary Guaranty, in accordance with the terms thereof, on and as of such date and, in the event that such date shall occur after the first Borrowing Date, to deliver to the Administrative Agent, simultaneously with the execution and delivery of the same, (i) a certificate, dated the date such Material Subsidiary shall have become a party to the Subsidiary Guaranty, executed by such Material Subsidiary and substantially in the form of, and with substantially the same attachments as, the certificate which would have been required under Section 5.1 if such Material Subsidiary had become a party to the Subsidiary Guaranty on or before the first Borrowing Date, and (ii) if requested by the Administrative Agent, an opinion of counsel to such Material Subsidiary, covering the same matters with respect to such Material Subsidiary as were covered by the opinions delivered pursuant to Section 5.2, in form and substance reasonably satisfactory to the Administrative Agent. 8. NEGATIVE COVENANTS The Parent Borrower agrees that, so long as this Agreement is in effect, any Loan or Reimbursement Obligation remains outstanding, or any other amount is owing under any Loan Document to any Lender, the Issuing Bank, the Swing Line Lender or the Administrative Agent, the Parent Borrower shall not, directly or indirectly: 98

8.1. INDEBTEDNESS Create, incur, assume or suffer to exist any liability for Indebtedness, or permit any of its Subsidiaries so to do, except (i) Indebtedness due under the Loan Documents, (ii) Indebtedness existing on the Effective Date as set forth on Schedule 8.1 and refinancings thereof, (iii) Unrestricted Intercompany Indebtedness, (iv) Other Intercompany Indebtedness, provided that, immediately after the incurrence of each such Other Intercompany Indebtedness, the Other Intercompany Basket Amount shall not exceed an amount equal to 20% of Consolidated Tangible Net Worth, (v) Indebtedness in an aggregate principal amount not in excess of 5% of Consolidated Tangible Net Worth at any one time outstanding (a) in respect of Capital Leases, (b) secured by Liens on Property (including, in the event such Property constitutes capital stock of a newly acquired Subsidiary of the Parent Borrower, Liens on the Property of such Subsidiary) acquired by the Parent Borrower or any of its Subsidiaries after the Effective Date, provided that such Liens are in existence on the date of such acquisition and were not placed on such Property in contemplation of such acquisition, and (c) other purchase money Indebtedness, provided that, in each case under this Section 8.1(v), the Lien securing such Indebtedness is permitted by Section 8.2, and (vi) other unsecured Indebtedness, provided that, (a) immediately before and after giving effect to the incurrence thereof, no Default shall or would exist, and (b) the aggregate outstanding principal amount of all such Indebtedness incurred by the Subsidiaries of the Parent Borrower shall not exceed $10,000,000 at any time. 8.2. LIENS Create, incur, assume or suffer to exist any Lien upon any of its Property, whether now owned or hereafter acquired, or permit any of its Subsidiaries so to do, except (i) Liens for Taxes in the ordinary course of business which are not delinquent or which are being contested in accordance with Section 7.4, provided that enforcement of such Liens is stayed pending such contest, (ii) Liens in connection with workers' compensation, unemployment insurance or other social security obligations (but not ERISA), (iii) deposits or pledges to secure bids, tenders, contracts (other than contracts for the payment of Indebtedness), leases, statutory obligations, surety and appeal bonds and other obligations of like nature arising in the ordinary course of business, (iv) zoning ordinances, easements, rights of way, minor defects, irregularities, and other similar restrictions affecting real Property which do not materially and adversely affect the value of such real Property or materially impair its use for the operation of the business of the Parent Borrower or such Subsidiary, (v) Liens arising by operation of law such as mechanics', materialmen's, carriers', warehousemen's liens incurred in the ordinary course of business which are being contested in accordance with Section 7.6, (vi) Liens arising out of judgments or decrees which are being contested in accordance with Section 7.6, provided that enforcement of such Liens is stayed pending such contest, (vii) statutory Liens in favor of lessors arising in connection with the Property leased to the Parent Borrower or any of its Subsidiaries, (viii) Liens under capital leases and Liens on 99

Property (including, in the event such Property constitutes capital stock of a newly acquired Subsidiary of the Parent Borrower, Liens on the Property of such Subsidiary) acquired after the Effective Date and either existing on such Property when acquired, or created contemporaneously with such acquisition, to secure the payment or financing of the purchase price thereof, provided that such Liens attach only to the Property so purchased or acquired and provided further that the Indebtedness secured by such Liens is permitted by Section 8.1(v), (ix) Liens pursuant to the Synthetic Lease Arrangement, and (x) Liens on Property of the Parent Borrower and its Subsidiaries existing on the Effective Date as set forth on Schedule 8.2, as renewed from time to time, but not any increases in the amounts secured thereby or extensions thereof to additional Property. 8.3. MERGERS AND CONSOLIDATIONS Consolidate or merge into or with any Person, or enter into any binding agreement to do so which is not contingent on obtaining the consent of the requisite Lenders, or permit any of its Subsidiaries so to do, except: (a) provided that, immediately before and after giving effect thereto, no Default shall exist, (i) the Parent Borrower may consolidate or merge with any direct or indirect wholly-owned Subsidiary thereof (other than an Active Subsidiary Borrower), provided that the Parent Borrower shall be the survivor, (ii) any Active Subsidiary Borrower may consolidate or merge with any direct or indirect wholly-owned Subsidiary of the Parent Borrower (other than an Active Subsidiary Borrower), provided that such Active Subsidiary Borrower shall be the survivor, and (iii) any Active Subsidiary Borrower may consolidate or merge with any other Active Subsidiary Borrower which shall be organized under the laws of, and have its principal office in, the same national jurisdiction as such Active Subsidiary Borrower, provided that the survivor shall have assumed in a manner in all respects reasonably satisfactory to the Administrative Agent all of the other entity's obligations and liabilities under the Loans Documents, in each case whether fixed, contingent, then existing or thereafter arising, created, assumed, incurred or acquired, and whether before or after the occurrence of any Event of Default under Section 9.1(g) or (h); and (b) other consolidations and mergers permitted by Sections 8.4(c), 8.4(d), 8.4(e), 8.5(c), 8.5(d) and 8.5(e). 8.4. ACQUISITIONS Make any Acquisition or enter into any binding agreement to do so which is not contingent on obtaining the consent of the requisite Lenders, or permit any of its Subsidiaries so to do, except: 100

(a) Acquisitions of Investments permitted by Section 8.6; (b) Acquisitions pursuant to the Synthetic Lease Arrangement; (c) Unrestricted Intercompany Acquisitions, provided that, in the event that any such Unrestricted Intercompany Acquisition shall be effected by or through a consolidation or merger involving the Parent Borrower or any Active Subsidiary Borrower, then such consolidation or merger shall be otherwise permitted by Section 8.3(a); (d) Other Intercompany Acquisitions, provided that (i) each such Other Intercompany Acquisition shall be otherwise permitted by Section 8.10, (ii) in the event that any such Other Intercompany Acquisition shall be effected by or through a consolidation or merger involving the Parent Borrower or any Active Subsidiary Borrower, then, in the case of the Parent Borrower, the Parent Borrower shall be the survivor, and, in the case of such Active Subsidiary Borrower, such Active Subsidiary Borrower shall be the survivor unless otherwise permitted by Section 8.3(a), and (iii) to the extent that the aggregate consideration paid in connection with any such Other Intercompany Acquisition shall be comprised of one or more Investments, each such Investment shall be otherwise permitted by Section 8.6(g) or 8.6(h); and (e) other Acquisitions by the Parent Borrower or any of its Subsidiaries, provided that, (i) in the event that any Operating Entity shall be acquired in connection with any such Acquisition, then such Operating Entity shall be in, or otherwise constitute, a line of business which is related or complementary to the line of business of the Parent Borrower and its Subsidiaries, (ii) in the event that any such Acquisition shall be effected by or through a consolidation or merger involving the Parent Borrower or any Active Subsidiary Borrower, then, in the case of the Parent Borrower, the Parent Borrower shall be the survivor, and, in the case of such Active Subsidiary Borrower, such Active Subsidiary Borrower shall be the survivor unless otherwise permitted by Section 8.3(a), and (iii) immediately before and after giving effect to each such Acquisition, no Default shall or would exist, and all of the representations and warranties contained in Section 4 shall be true and correct as if then made. 8.5. DISPOSITIONS Make any Disposition, or permit any of its Subsidiaries so to do, except: (a) Dispositions of any Investments permitted under Sections 8.6(a) and 8.6(c); 101

(b) Dispositions of Property which, in the reasonable opinion of the Parent Borrower or such Subsidiary, as the case may be, is obsolete or no longer useful in the conduct of it business; (c) Unrestricted Intercompany Dispositions, provided that, in the event that any such Unrestricted Intercompany Disposition shall be effected by or through a consolidation or merger involving the Parent Borrower or any Active Subsidiary Borrower, then, in the case of the Parent Borrower, the Parent Borrower shall be the survivor, and, in the case of such Active Subsidiary Borrower, such Active Subsidiary Borrower shall be the survivor unless otherwise permitted by Section 8.3(a); (d) Other Intercompany Dispositions, provided that (i) each such Other Intercompany Disposition shall be otherwise permitted by Section 8.10, (ii) in the event that any such Other Intercompany Disposition shall be effected by or through a consolidation or merger involving the Parent Borrower or any Active Subsidiary Borrower, then, in the case of the Parent Borrower, the Parent Borrower shall be the survivor, and, in the case of such Active Subsidiary Borrower, such Active Subsidiary Borrower shall be the survivor unless otherwise permitted by Section 8.3(a), and (iii) to the extent that the aggregate consideration paid in connection with any such Other Intercompany Disposition shall be comprised of one or more Investments, each such Investment shall be otherwise permitted by Section 8.6(g) or 8.6(h); and (e) other Dispositions, provided that, (i) in the event any such Disposition shall be effected by or through a consolidation or merger involving the Parent Borrower or any Active Subsidiary Borrower, then, in the case of the Parent Borrower, the Parent Borrower shall be the survivor, and, in the case of such Active Subsidiary Borrower, such Active Subsidiary Borrower shall be the survivor unless otherwise permitted by Section 8.3(a), (ii) immediately before and after giving effect to each such Disposition, no Default shall or would exist, and all of the representations and warranties contained in Section 4 shall be true and correct as if then made, and (iii) immediately after giving effect to each such Disposition, the aggregate fair market value of the Property sold, assigned, transferred or otherwise disposed of in connection with such Disposition, when aggregated with the aggregate fair market value of all Property sold, assigned, transferred or otherwise disposed of in connection with all other Dispositions made on and after the date hereof under this Section 8.5(e), shall not exceed an amount equal to 10% of Consolidated Tangible Net Worth. 8.6. INVESTMENTS At any time, purchase or otherwise acquire, hold or invest in the Capital Stock of, or any other interest in, any Person, or make any loan or advance to, or enter into any arrangement for the purpose of providing funds or credit to, or make any other 102

investment, whether by way of capital contribution, time deposit or otherwise, in or with any Person (all of which are sometimes referred to herein as "INVESTMENTS"), or permit any of its Subsidiaries so to do, except: (a) Investments in Cash Equivalents; (b) Investments existing on the Effective Date as set forth on Schedule 8.6; (c) normal business banking accounts and short-term certificates of deposit and time deposits in, or issued by, federally insured institutions in amounts not exceeding the limits of such insurance; (d) Acquisitions permitted by Section 8.3 and 8.4; (e) Investments in any seller debt incurred in connection with Dispositions permitted by Section 8.5; (f) Unrestricted Intercompany Investments; (g) Other Intercompany Investments made on or after the date hereof (other than Investments permitted by Section 8.6(b)), provided that, immediately after giving effect to each such Other Intercompany Investment, the Other Intercompany Basket Amount shall not exceed an amount equal to 20% of Consolidated Tangible Net Worth; and (h) other Investments made on or after the date hereof (other than Investments permitted by Section 8.6(b)), provided that, (i) immediately before and after giving effect to each such other Investment, no Default shall or would exist, and all of the representations and warranties contained in Section 4 shall be true and correct as if then made, and (ii) the aggregate consideration paid for all such other Investments shall not exceed $10,000,000. 8.7. RESTRICTED PAYMENTS Declare or make any Restricted Payments, or permit any of its Subsidiaries so to do, except: (a) Unrestricted Intercompany Payments; (b) Other Intercompany Restricted Payments made on or after the date hereof, provided that, immediately after giving effect thereto, the Other Intercompany Basket Amount shall not exceed an amount equal to 20% of Consolidated Tangible Net Worth; and 103

(c) other Restricted Payments made on or after the date hereof, provided that, (i) immediately before and after giving effect thereto, no Default shall or would exist, and (ii) the aggregate amount of all such Restricted Payments received by Persons other than the Parent Borrower and its Subsidiaries shall not exceed $12,000,000 in any fiscal year. 8.8. BUSINESS CHANGES Except as may be otherwise permitted by Section 8.3 or 8.4, materially change the nature of the business of the Parent Borrower and its Subsidiaries as conducted on the Effective Date. 8.9. AMENDMENTS, ETC. Enter into or agree to, or permit any of its Subsidiaries so to do, any amendment, supplement, other modification or waiver of any term or condition of its Organizational Documents, unless, in each such case, such amendment, supplement, other modification or waiver would not adversely affect the Administrative Agent, the Issuing Bank, the Swing Line Lender or any Lender. 8.10. TRANSACTIONS WITH AFFILIATES Become, or permit any of its Subsidiaries to become, a party to any transaction with any Affiliate thereof unless the Parent Borrower's Managing Person shall have determined that the terms and conditions relating thereto are as favorable to the Parent Borrower or such Subsidiary, as the case may be, as those which would be obtainable at the time in a comparable arms-length transaction with a Person other than an Affiliate thereof. 8.11. LIMITATION ON UPSTREAM PAYMENTS BY SUBSIDIARIES Permit or cause any of its Subsidiaries to enter into or agree, or otherwise be or become subject, to any agreement, contract or other arrangement (other than this Agreement) with any Person pursuant to the terms of which such Subsidiary is or would be prohibited from declaring or making, or restricted in its ability to declare or make, any Restricted Payment or any loan or advance to the Parent Borrower or any other Subsidiary thereof or prohibited from repaying, or restricted in its ability to repay, any loan or advance from the Parent Borrower or any other Subsidiary thereof. 8.12. PREPAYMENTS OF INDEBTEDNESS Prepay or obligate itself to prepay, in whole or in part, any long-term Indebtedness (other than Indebtedness under the Loan Documents), or permit any of its Subsidiaries so to do, except that the Parent Borrower or any of its Subsidiaries may refinance any long-term Indebtedness with any other long-term Indebtedness, provided 104

that the terms and conditions thereof shall, in the reasonable determination of the Administrative Agent, be no less favorable to the Parent Borrower or such Subsidiary, as the case may be, as the long-term Indebtedness so being refinanced. 8.13. LIMITATION ON NEGATIVE PLEDGES Enter into any agreement, other than (i) this Agreement or (ii) any agreement in respect of Indebtedness permitted by Section 8.1(v), provided that any prohibition or limitation referred to in this Section 8.13 shall only be effective against the assets financed by such agreement, or permit any of its Subsidiaries so to do, which prohibits or limits the ability of the Parent Borrower or such Subsidiary to create, incur, assume or suffer to exist any Lien in favor of the Administrative Agent, the Lenders, the Swing Line Lender and/or the Issuing Bank upon any of its Property, whether now owned or hereafter acquired. 9. DEFAULT 9.1. EVENTS OF DEFAULT The following shall each constitute an "EVENT OF DEFAULT" hereunder: (a) The failure of any Borrower to make any payment of principal with respect to any Loan when due and payable, or the failure of the Parent Borrower to make any payment with respect to any Reimbursement Obligation when due and payable; or (b) The failure of any Credit Party to make any payment of interest, Fees, expenses or other amounts payable under any Loan Document or otherwise to the Administrative Agent with respect to the loan facilities established hereunder within three Business Days of the date when due and payable; or (c) The failure of any Credit Party to observe or perform any covenant or agreement contained in Sections 2.7, 7.3, 7.11, 7.12 or Section 8 (other than Sections 8.1, 8.2, 8.6 and 8.13); or (d) The failure of any Credit Party to observe or perform (i) any term, covenant or agreement contained in Section 8.1, 8.2, 8.6 or 8.13 and such failure shall have continued unremedied for a period of 10 days after such Credit Party shall have become aware thereof, or (ii) any other term, covenant, or agreement contained in any Loan Document and such failure shall have continued unremedied for a period of 30 days after such Credit Party shall have become aware thereof; or 105

(e) Any representation or warranty made or deemed made by any Credit Party (or by an officer thereof on its behalf) in any Loan Document or in any certificate, report, opinion (other than an opinion of counsel) or other document delivered or to be delivered pursuant thereto, shall prove to have been incorrect or misleading (whether because of misstatement or omission) in any material respect when made or deemed made; or (f) (i) Liabilities and/or other obligations of the Parent Borrower (other than its obligations hereunder) or any of its Subsidiaries, whether as principal, guarantor, surety or other obligor, for the payment of any Indebtedness in an aggregate amount in excess of $1,000,000 (A) shall become or shall be declared to be due and payable prior to the expressed maturity thereof, or (B) shall not be paid when due or within any grace period for the payment thereof, or (ii) any holder of any such liability or other obligation shall have the right to declare such liability or other obligation due and payable prior to the expressed maturity thereof and the applicable defaults or events of default giving rise to such right shall then be continuing; or (g) Any Credit Party (other than an Inactive Subsidiary Borrower) shall (i) make an assignment for the benefit of creditors, (ii) generally not be paying its debts as such debts become due, (iii) admit in writing its inability to pay its debts as they become due, (iv) file a voluntary petition in bankruptcy, (v) become insolvent (however such insolvency shall be evidenced), (vi) file any petition or answer seeking for itself any reorganization, arrangement, composition, readjustment of debt, liquidation or dissolution or similar relief under any present or future statute, law or regulation of any jurisdiction, (vii) petition or apply to any tribunal for any receiver, custodian or any trustee for any substantial part of its Property, (viii) be the subject of any such proceeding filed against it which remains undismissed for a period of 45 days, (ix) file any answer admitting or not contesting the material allegations of any such petition filed against it or any order, judgment or decree approving such petition in any such proceeding, (x) seek, approve, consent to, or acquiesce in any such proceeding, or in the appointment of any trustee, receiver, sequestrator, custodian, liquidator, or fiscal agent for it, or any substantial part of its Property, or an order is entered appointing any such trustee, receiver, custodian, liquidator or fiscal agent and such order remains in effect for 45 days, or (xi) take any formal action for the purpose of effecting any of the foregoing or looking to the liquidation or dissolution of such Credit Party (except as may be otherwise expressly permitted herein); or (h) An order for relief is entered under the United States bankruptcy laws or any other decree or order is entered by a court having jurisdiction (i) adjudging any Credit Party (other than an Inactive Subsidiary Borrower) bankrupt or insolvent, (ii) approving as properly filed a petition seeking reorganization, 106

liquidation, arrangement, adjustment or composition of or in respect of any Credit Party (other than an Inactive Subsidiary Borrower) under the United States bankruptcy laws or any other applicable Federal or state law, (iii) appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) of any Credit Party (other than an Inactive Subsidiary Borrower) or of any substantial part of the Property thereof, or (iv) ordering the winding up or liquidation of the affairs of any Credit Party (other than an Inactive Subsidiary Borrower), and, in each case, such other decree or order continues unstayed and in effect for a period of 45 days; or (i) Judgments or decrees against the Parent Borrower or any of its Subsidiaries aggregating in excess of $500,000 shall remain unpaid, unstayed on appeal, undischarged, unbonded or undismissed for a period of 30 days; or (j) The occurrence of a Change of Control; or (k) Any Loan Document shall cease, for any reason, to be in full force and effect, or any Credit Party shall so assert in writing or shall disavow any of its obligations thereunder, or any Event of Default shall have occurred under, and as such term is defined in, any Loan Document; or (l) (i) any Termination Event shall occur; (ii) any Accumulated Funding Deficiency, whether waived, shall exist with respect to any Pension Plan; (iii) any Person shall engage in any Prohibited Transaction involving any Employee Benefit Plan; (iv) the Parent Borrower, any of its Subsidiaries or any ERISA Affiliate shall fail to pay when due an amount which is payable by it to the PBGC or to a Pension Plan under Title IV of ERISA; (v) the imposition of any tax under Section 4980B(a) of the Code; (vi) the assessment of a civil penalty with respect to any Employee Benefit Plan under Section 502(c) of ERISA; or (vii) any other event or condition shall occur or exist with respect to an Employee Benefit Plan which in the case of clauses (i) through (vii) would, individually or in the aggregate, have a Material Adverse Effect; or (m) A default by the Parent Borrower or any of its Subsidiaries shall have occurred under the Synthetic Lease Arrangement, and the applicable grace period or cure period, if any, with respect to such default shall have expired. 9.2. CONTRACT REMEDIES (a) Upon the occurrence of an Event of Default or at any time thereafter during the continuance thereof, (i) if it is an Event of Default specified in Section 9.1(g) or 9.1(h), all Revolving Credit Commitments, the Swing Line Commitment and the Letter of Credit Commitment shall immediately and automatically terminate and the Loans, all accrued and unpaid interest thereon, any Reimbursement Obligations owing or contingently owing in respect of all outstanding Letters of Credit 107

and all other amounts owing under the Loan Documents shall immediately become due and payable, and (ii) if it is any other Event of Default, upon the direction of the Required Lenders, the Administrative Agent shall (A) by notice to the Parent Borrower, declare all Revolving Credit Commitments, the Swing Line Commitment, and the Letter of Credit Commitment to be terminated forthwith, whereupon such Revolving Credit Commitments, the Swing Line Commitment and the Letter of Credit Commitment shall immediately terminate, and/or (B) by notice of default to the Parent Borrower, declare the Loans, all accrued and unpaid interest thereon, any Reimbursement Obligations owing or contingently owing in respect of all outstanding Letters of Credit and all other amounts owing under the Loan Documents to be due and payable forthwith, whereupon the same shall immediately become due and payable. Except as otherwise provided in this Section, presentment, demand, protest and all other notices of any kind are hereby expressly waived. Each Credit Party hereby further expressly waives and covenants not to assert any appraisement, valuation, stay, extension, redemption or similar laws, now or at any time hereafter in force which might delay, prevent or otherwise impede the performance or enforcement of any Loan Document. (b) In the event that the Revolving Credit Commitments, the Swing Line Commitment and the Letter of Credit Commitment shall have been terminated or the Loans, any Reimbursement Obligations owing or contingently owing in respect of all outstanding Letters of Credit and all other amounts owing under the Loan Documents shall have been declared due and payable pursuant to the provisions of this Section, any funds received by the Administrative Agent, the Issuing Bank, the Swing Line Lender and the Lenders from or on behalf of the Borrowers shall be remitted to, and applied by, the Administrative Agent in the following manner and order: (i) first, to the payment of interest on, and then the principal portion of, any Revolving Credit Loans which the Administrative Agent may have advanced on behalf of any Lender for which the Administrative Agent has not then been reimbursed by such Lender or any Credit Party; (ii) second, to reimburse the Administrative Agent, the Issuing Bank, the Swing Line Lender for any expenses due from the Credit Parties pursuant to the provisions of Section 11.5 and the Reimbursement Agreements, (iii) third, to the payment of the Reimbursement Obligations and the outstanding principal amount of the Swing Line Loans (together with all interest thereon), (iv) fourth, to the payment of the Fees, (v) fifth, to the payment of any other fees, expenses or amounts (other than the principal of and interest on the Loans) payable by the Credit Parties to the Administrative Agent, the Issuing Bank, the Swing Line Lender or any of the Lenders under the Loan Documents, (vi) sixth, to the payment, pro rata according to the Outstanding Percentage of each Lender, of interest due on the Loans (other than the Swing Line Loans), (vii) seventh, to the payment, pro rata according to Outstanding Percentage of each Lender, of principal on the Loans (other than the Swing Line Loans), of such principal, and (viii) eighth, any remaining funds shall be paid to whomsoever shall be entitled thereto or as a court of competent jurisdiction shall direct. 108

10. THE ADMINISTRATIVE AGENT 10.1. APPOINTMENT Each of the Issuing Bank, the Swing Line Lender and each Lender hereby irrevocably designates and appoints BNY as the Administrative Agent of the Issuing Bank, the Swing Line Lender and such Lender under the Loan Documents and each of the Issuing Bank, the Swing Line Lender and each Lender hereby irrevocably authorizes the Administrative Agent to take such action on its behalf under the provisions of the Loan Documents and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent by the terms of the Loan Documents, together with such other powers as are reasonably incidental thereto. The duties of the Administrative Agent shall be mechanical and administrative in nature, and, notwithstanding any provision to the contrary elsewhere in any Loan Document, the Administrative Agent shall not have any duties or responsibilities other than those expressly set forth therein, or any fiduciary relationship with, or fiduciary duty to, the Issuing Bank, the Swing Line Lender or any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into the Loan Documents or otherwise exist against the Administrative Agent. 10.2. DELEGATION OF DUTIES The Administrative Agent may execute any of its duties under the Loan Documents by or through agents or attorneys-in-fact and shall be entitled to rely upon, and shall be fully protected in, and shall not be under any liability for, relying upon, the advice of counsel concerning all matters pertaining to such duties. 10.3. EXCULPATORY PROVISIONS Neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with the Loan Documents (except the Administrative Agent for its own gross negligence or willful misconduct), or (ii) responsible in any manner to the Issuing Bank, the Swing Line Lender or any of the Lenders for any recitals, statements, representations or warranties made by any Credit Party, or any officer thereof, contained in the Loan Documents or in any certificate, report, statement or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, the Loan Documents or for the value, validity, effectiveness, genuineness, perfection, enforceability or sufficiency of any of the Loan Documents or for any failure of any Credit Party or any other Person to perform its obligations thereunder. The Administrative Agent shall not be under any obligation to the Issuing Bank, the Swing Line Lender or any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, the Loan Documents, or to inspect the Property, books or records of any Credit Party. The Issuing Bank, the Swing Line Lender and the Lenders 109

acknowledge that the Administrative Agent shall not be under any duty to take any discretionary action permitted under the Loan Documents unless the Administrative Agent shall be instructed in writing to do so by the Issuing Bank, the Swing Line Lender and Required Lenders and such instructions shall be binding on the Issuing Bank, the Swing Line Lender and all Lenders; PROVIDED, HOWEVER, that the Administrative Agent shall not be required to take any action which exposes the Administrative Agent to personal liability or is contrary to law or any provision of the Loan Documents. The Administrative Agent shall not be under any liability or responsibility whatsoever, as Administrative Agent, to any Credit Party or any other Person as a consequence of any failure or delay in performance, or any breach, by the Issuing Bank, the Swing Line Lender or any Lender of any of its obligations under any of the Loan Documents. 10.4. RELIANCE BY ADMINISTRATIVE AGENT The Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent, certificate, affidavit, opinion, letter, cablegram, telegram, facsimile, telex or teletype message, statement, order or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by a proper Person or Persons and upon advice and statements of legal counsel (including counsel to any Credit Party), independent accountants and other experts selected by the Administrative Agent. The Administrative Agent may treat the Issuing Bank, the Swing Line Lender or each Lender, as the case may be, or the Person designated in the last notice filed with it under this Section, as the holder of all of the interests of the Issuing Bank, the Swing Line Lender or such Lender, as the case may be, in its Loans, the Letters of Credit and the Reimbursement Obligations, as applicable, until written notice of transfer, signed by the Issuing Bank, the Swing Line Lender or such Lender (or the Person designated in the last notice filed with the Administrative Agent) and by the Person designated in such written notice of transfer, in form and substance satisfactory to the Administrative Agent, shall have been filed with the Administrative Agent. The Administrative Agent shall not be under any duty to examine or pass upon the validity, effectiveness, enforceability or genuineness of the Loan Documents or any instrument, document or communication furnished pursuant thereto or in connection therewith, and the Administrative Agent shall be entitled to assume that the same are valid, effective and genuine, have been signed or sent by the proper parties and are what they purport to be. The Administrative Agent shall be fully justified in failing or refusing to take any action under the Loan Documents unless it shall first receive such advice or concurrence of the Required Lenders as it deems appropriate. The Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under the Loan Documents in accordance with a request or direction of the Required Lenders, and such request or direction and any action taken or failure to act pursuant thereto shall be binding upon the Issuing Bank, the Swing Line Lender, all the Lenders and all future holders of the Loans and the Reimbursement Obligations. 110

10.5. NOTICE OF DEFAULT The Administrative Agent shall be deemed not to have knowledge or notice of the occurrence of any Default unless the Administrative Agent has received written notice thereof from the Issuing Bank, the Swing Line Lender, a Lender or any Credit Party. In the event that the Administrative Agent receives such a notice, the Administrative Agent shall promptly give notice thereof to the Issuing Bank, the Swing Line Lender, the Lenders and the Parent Borrower. 10.6. NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS Each of the Issuing Bank, the Swing Line Lender and each Lender expressly acknowledges that neither the Administrative Agent nor any of its respective officers, directors, employees, agents, attorneys-in-fact or affiliates has made any representations or warranties to it and that no act by the Administrative Agent hereinafter, including any review of the affairs of the Parent Borrower or any of its Subsidiaries, shall be deemed to constitute any representation or warranty by the Administrative Agent to the Issuing Bank, the Swing Line Lender or any Lender. Each of the Issuing Bank, the Swing Line Lender and each Lender represents to the Administrative Agent that it has, independently and without reliance upon the Administrative Agent, the Issuing Bank, the Swing Line Lender or any Lender, and based on such documents and information as it has deemed appropriate made its own evaluation of and investigation into the business, operations, Property, financial and other condition and creditworthiness of the Parent Borrower and its Subsidiaries and made its own decision to enter into this Agreement. Each of the Issuing Bank, the Swing Line Lender and each Lender also represents that it will, independently and without reliance upon the Administrative Agent, the Issuing Bank, the Swing Line Lender or any Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, evaluations and decisions in taking or not taking action under any Loan Document, and to make such investigation as it deems necessary to inform itself as to the business, operations, Property, financial and other condition and creditworthiness of the Parent Borrower and its Subsidiaries. Except for notices, reports and other documents expressly required to be furnished to the Issuing Bank, the Swing Line Lender and/or the Lenders by the Administrative Agent hereunder, the Administrative Agent shall not have any duty or responsibility to provide the Issuing Bank, the Swing Line Lender or any Lender with any credit or other information concerning the business, operations, Property, financial and other condition or creditworthiness of the Parent Borrower and its Subsidiaries which at any time may come into the possession of the Administrative Agent or any of its officers, directors, employees, agents, attorneys-in-fact or affiliates. 10.7. INDEMNIFICATION Each Lender agrees to indemnify and hold harmless the Administrative Agent in its capacity as such (to the extent not promptly reimbursed by any Credit Party and without limiting the obligation of any Credit Party to do so), pro rata according to (i) 111

at any time prior to the Commitment Termination Date, its Commitment Percentage, and (ii) at all other times, (a) if no Loan or Reimbursement Obligation is outstanding, its Commitment Percentage, and (b) if any Loan or Reimbursement Obligation is outstanding, its Outstanding Percentage, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever including any amounts paid to the Issuing Bank, the Swing Line Lender or any Lender (through the Administrative Agent) by any Credit Party pursuant to the terms of the Loan Documents, that are subsequently rescinded or avoided, or must be otherwise restored or returned) which may at any time (including at any time following the payment of the Loans or the Reimbursement Obligations) be imposed on, incurred by or asserted against the Administrative Agent in any way relating to or arising out of the Loan Documents or any other documents contemplated by or referred to therein or the transactions contemplated thereby or any action taken or omitted to be taken by the Administrative Agent under or in connection with any of the foregoing; PROVIDED, HOWEVER, that no Lender shall be liable to the Administrative Agent for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements to the extent resulting solely from the finally adjudicated gross negligence or willful misconduct of the Administrative Agent. Without limitation of the foregoing, each Lender agrees to reimburse each Agent promptly upon demand for its pro rata share (calculated as set forth in the first sentence of this Section) of any unpaid fees owing to the Administrative Agent, and any costs and expenses (including reasonable fees and expenses of counsel) payable by any Credit Party under Section 11.5, to the extent that the Administrative Agent has not been paid such fees or has not been reimbursed for such costs and expenses, by any Credit Party. The failure of any Lender to reimburse the Administrative Agent promptly upon demand for its pro rata share (as so calculated) of any amount required to be paid by the Lenders to the Administrative Agent as provided in this Section shall not relieve any other Lender of its obligation hereunder to reimburse the Administrative Agent for its pro rata share (as so calculated) of such amount, but no Lender shall be responsible for the failure of other Lender to reimburse the Administrative Agent for such other Lender's pro rata share (as so calculated) of such amount. The agreements in this Section shall survive the termination of the Revolving Credit Commitments, the Swing Line Commitment, the Letter of Credit Commitment, and the payment of all amounts payable under the Loan Documents. 10.8. ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY BNY and its affiliates may make secured or unsecured loans to, accept deposits from, issue letters of credit for the account of, act as trustee under indentures of, and generally engage in any kind of business with, the Parent Borrower or any of its Subsidiaries as though BNY were not Administrative Agent hereunder and BNY Capital Markets did not arrange the transactions contemplated hereby. With respect to the Revolving Credit Commitment, Swing Line Commitment and Letter of Credit Commitment made or renewed by BNY and the Loans and Reimbursement Obligations 112

owing to BNY, BNY shall have the same rights and powers under the Loan Documents as the Issuing Bank, the Swing Line Lender or any Lender and may exercise the same as though it were not the Administrative Agent, and the terms "Lender" and "Lenders" shall in each case include BNY. 10.9. SUCCESSOR ADMINISTRATIVE AGENT If at any time the Administrative Agent deems it advisable, in its sole discretion, it may submit to the Issuing Bank, the Swing Line Lender and each of the Lenders a written notice of its resignation as Administrative Agent under the Loan Documents, such resignation to be effective upon the earlier of (i) the written acceptance of the duties of the Administrative Agent under the Loan Documents by a successor Administrative Agent and (ii) on the 30th day after the date of such notice. Upon any such resignation, the Required Lenders shall have the right to appoint from among the Lenders a successor Administrative Agent, provided that the Parent Borrower shall have consented thereto in writing (which consent shall not be unreasonably withheld and shall not be required if a Default shall have occurred and then be continuing). If no successor Administrative Agent shall have been so appointed by the Required Lenders and accepted such appointment in writing within 30 days after the retiring Administrative Agent's giving of notice of resignation, then the retiring Administrative Agent may, on behalf of the Issuing Bank, the Swing Line Lender and the Lenders, appoint a successor Administrative Agent, which successor Administrative Agent shall be a commercial bank organized under the laws of the United States or any State thereof and having a combined capital, surplus, and undivided profits of at least $100,000,000. Upon the acceptance of any appointment as Administrative Agent hereunder by a successor Administrative Agent, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent's rights, powers, privileges and duties as Administrative Agent under the Loan Documents shall be terminated. The Credit Parties, the Issuing Bank, the Swing Line Lender and the Lenders shall execute such documents as shall be necessary to effect such appointment. After any retiring Administrative Agent's resignation as Administrative Agent, the provisions of the Loan Documents shall inure to its benefit as to any actions taken or omitted to be taken by it, and any amounts owing to it, while it was Administrative Agent under the Loan Documents. If at any time there shall not be a duly appointed and acting Administrative Agent, the Credit Parties agree to make each payment due under the Loan Documents directly to the Issuing Bank, the Swing Line Lender and the Lenders entitled thereto during such time. 11. OTHER PROVISIONS 11.1. AMENDMENTS AND WAIVERS Except as otherwise provided in Section 10(i) of the Subsidiary Guaranty, with the written consent of the Required Lenders, the Administrative Agent and the 113

appropriate Credit Parties may, from time to time, enter into written amendments, supplements or modifications of the Loan Documents and, with the consent of the Required Lenders, the Administrative Agent on behalf of the Issuing Bank, the Swing Line Lender and the Lenders may execute and deliver to any such Credit Parties a written instrument waiving or a consent to a departure from, on such terms and conditions as the Administrative Agent may specify in such instrument, any of the requirements of the Loan Documents or any Default and its consequences; PROVIDED, HOWEVER, that: (a) no such amendment, supplement, modification, waiver or consent shall, without the consent of all of the Lenders, (i) increase the Revolving Credit Commitment Amount of any Lender or the Aggregate Revolving Credit Commitment Amount, (ii) extend the Scheduled Revolving Credit Commitment Termination Date, (iii) decrease the rate, or extend the time of payment, of interest of, or change or forgive the principal amount or extend the time of payment of, any Loan (other than a Swing Line Loan), or decrease the rate, or extend the time of payment, of the Facility Fee or the Letter of Credit Commissions, (iv) change the provisions of Sections 3.4, 3.5, 3.6, 3.7, 3.8, 3.9, 3.10, 11.1, 11.6(a) or 11.7, (v) change the definition of "Required Lenders", or (vi) release any Credit Party from all or substantially all its obligations under the Subsidiary Guaranty (other than as provided in Section 10(i) of the Subsidiary Guaranty); (b) without the written consent of the Issuing Bank, no such amendment, supplement, modification or waiver shall change the Letter of Credit Commitment, change the amount or the time of payment of the Letter of Credit Commissions or change any other term or provision which relates to the Letter of Credit Commitment or the Letters of Credit or any other rights of the Issuing Bank under any Loan Document; (c) without the written consent of the Administrative Agent, no such amendment, supplement, modification or waiver shall amend, modify or waive any provision of Section 10 or otherwise change any of the rights or obligations of the Administrative Agent hereunder or under the Loan Documents; and (d) without the written consent of the Swing Line Lender, no such amendment, supplement, modification or waiver shall change the Swing Line Commitment or change any other term or provision that relates to the Swing Line Commitment or the Swing Line Loans. Any such amendment, supplement, modification or waiver shall apply equally to the Administrative Agent, the Swing Line Lender, the Issuing Bank and each of the Lenders and shall be binding upon the parties to the applicable Loan Document, the Lenders, the Swing Line Lender, the Issuing Bank, the Administrative Agent and all future holders of the Loans and the Reimbursement Obligations. In the case of any waiver, the parties to the applicable Loan Document, the Issuing Bank, the Lenders, the Swing Line Lender 114

and the Administrative Agent shall be restored to their former position and rights hereunder and under the Loan Documents to the extent provided for in such waiver, and any Default waived shall not extend to any subsequent or other Default, or impair any right consequent thereon. The Loan Documents may not be amended orally or by any course of conduct. 11.2. NOTICES All notices and other communications under the Loan Documents shall be given to each party hereto, initially, at the following address, and, thereafter, such other address through which it may from time to time be accepting notices, as designated by it in writing to the Administrative Agent and the Parent Borrower: (a) if to the Parent Borrower or any other Borrower, the office, branch or affiliate thereof designated as its address for notices in Exhibit O or the Borrower Addendum, if any, executed and delivered with respect to such Borrower pursuant to Section 2.12, as the case may be; (b) if to any Lender, the Issuing Bank or the Swing Line Lender, the office, branch, affiliate, or correspondent bank thereof designated as its address for notices in Exhibit N; and (c) if to the Administrative Agent, the office, branch, affiliate, or correspondent bank thereof designated as its address for notices in Exhibit M. Such notices and other communications will be effective only if and when given in writing, and shall be deemed to have been given three days after deposit in the mail, designated as certified mail, return receipt requested, postage-prepaid, at the applicable address specified above, or when delivered at the applicable address specified above, or when sent by telecopy addressed to the party to which such notice is directed at its address determined as provided above and receipt is confirmed, except that any notice, request or demand by any Borrower to or upon the Administrative Agent, the Issuing Bank, the Swing Line Lender or the Lenders pursuant to Sections 2.3, 2.4, 2.5, 2.6, 2.8 or 3.3 shall not be effective until received. Any party to a Loan Document may rely on signatures of the parties thereto which are transmitted by fax or other electronic means as fully as if originally signed. 11.3. NO WAIVER; CUMULATIVE REMEDIES No failure to exercise and no delay in exercising, on the part of the Administrative Agent, the Issuing Bank, the Swing Line Lender or any Lender, any right, remedy, power or privilege under any Loan Document shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege under any Loan Document preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges under the 115

Loan Documents are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law. 11.4. SURVIVAL OF REPRESENTATIONS AND WARRANTIES AND CERTAIN OBLIGATIONS (a) All representations and warranties made under the Loan Documents and in any document, certificate or statement delivered pursuant thereto or in connection therewith shall survive the execution and delivery of the Loan Documents. (b) The obligations of the Credit Parties under Sections 3.4, 3.5, 3.6, 3.7, 3.8, 3.9, 3.10, 11.5 and 11.7 shall survive the termination of the Revolving Credit Commitments, the Swing Line Commitment and the Letter of Credit Commitment and the payment of the Loans, the Reimbursement Obligations and all other amounts payable under the Loan Documents. 11.5. EXPENSES The Parent Borrower agrees, promptly upon presentation of a statement or invoice therefor, and whether any Loan is made (i) to pay or reimburse the Administrative Agent and BNY Capital Markets for all their respective out-of-pocket costs and expenses reasonably incurred in connection with the development, preparation, execution and syndication of, the Loan Documents and any amendment, supplement or modification thereto (whether or not executed or effective), any documents prepared in connection therewith and the consummation of the transactions contemplated thereby, including the reasonable fees and disbursements of Special Counsel, (ii) to pay or reimburse the Administrative Agent, the Issuing Bank, the Swing Line Lender and the Lenders for all of their respective costs and expenses, including reasonable fees and disbursements of counsel, incurred in connection with (a) any Default and any enforcement or collection proceedings resulting therefrom or in connection with the negotiation of any restructuring or "work-out" (whether consummated or not) of the obligations of any Credit Party under any of the Loan Documents and (b) the enforcement of this Section, (iii) to pay, indemnify, and hold each of the Lenders, the Swing Line Lender, the Issuing Bank and the Administrative Agent harmless from and against, any and all recording and filing fees and any and all liabilities with respect to, or resulting from any delay in paying, stamp, excise and other similar taxes, if any, which may be payable or determined to be payable in connection with the execution and delivery of, or consummation of any of the transactions contemplated by, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, the Loan Documents and any such other documents, and (iv) to pay, indemnify and hold each of the Lenders, the Swing Line Lender, the Issuing Bank and the Administrative Agent and each of their respective affiliates, officers, directors and employees harmless from and against any and all other liabilities, obligations, claims, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever (including reasonable counsel fees and disbursements) with respect to the enforcement and performance of the Loan Documents, the use of the 116

proceeds of the Loans and the Letters of Credit and the enforcement and performance of the provisions of any subordination agreement involving the Administrative Agent, the Issuing Bank, the Swing Line Lender and the Lenders (all the foregoing, collectively, the "INDEMNIFIED LIABILITIES"), and, if and to the extent that the foregoing indemnity may be unenforceable for any reason, the Parent Borrower agrees to make the maximum payment not prohibited under applicable law; PROVIDED, HOWEVER, that the Parent Borrower shall have no obligation to pay Indemnified Liabilities to the Administrative Agent, the Issuing Bank, the Swing Line Lender or any Lender, as the case may be, arising from the finally adjudicated gross negligence or willful misconduct of such Agent or such Lender, as the case may be, or claims between one indemnified party and another indemnified party. The agreements in this Section shall survive the termination of the Revolving Credit Commitments, the Swing Line Commitment and the Letter of Credit Commitment and the payment of all amounts payable under the Loan Documents. 11.6. ASSIGNMENTS AND PARTICIPATIONS (a) Except as may otherwise be permitted by Sections 7.3, 8.3, 8.4 and 8.5, (i) the Loan Documents shall be binding upon and inure to the benefit of the Credit Parties, the Lenders, the Swing Line Lender, the Issuing Bank, the Administrative Agent, all future holders of the Loans and the Reimbursement Obligations, and their respective successors and permitted assigns, and (ii) no Credit Party may assign, delegate or transfer any of its rights or obligations under the Loan Documents without the prior written consent of the Administrative Agent, the Issuing Bank, the Swing Line Lender and each Lender. (b) In addition to its rights under Section 11.6(e), each Lender shall have the right to sell, assign, transfer or negotiate (each an "ASSIGNMENT") one hundred percent, or any lesser percentage, of its rights and obligations under the Loan Documents to any subsidiary or affiliate of such Lender, to any other Lender, or to any Eligible Assignee, provided that (i) each such Assignment shall be of a constant, and not a varying, percentage of all of the assignor Lender's rights and obligations under the Loan Documents, (ii) the Revolving Credit Commitment Amount of the Revolving Credit Commitment assigned shall be not less than $5,000,000, or the full Revolving Credit Commitment Amount of such assignor Lender's Revolving Credit Commitment, (iii) the Parent Borrower, the Swing Line Lender, the Issuing Bank and the Administrative Agent shall have consented thereto in writing (which consents shall not be unreasonably withheld), PROVIDED, HOWEVER, that such consents shall not be required, (A) in the case of the Swing Line Lender, the Issuing Bank and the Administrative Agent, if such assignee is another Lender, and (B) in the case of the Parent Borrower, if a Default shall have occurred and then be continuing or such assignee is a subsidiary or affiliate of another Lender, and (iv) the assignor Lender and such assignee shall deliver to the Administrative Agent three copies of an Assignment and Acceptance Agreement executed by each of them, along with an assignment fee in the sum of $3,500 for the account of the Administrative Agent. Upon receipt of such number of executed copies of each such 117

Assignment and Acceptance Agreement, together with the assignment fee therefor and the Parent Borrower's, the Swing Line Lender's, the Issuing Bank's and the Administrative Agent's consents to such Assignment, if required, the Administrative Agent shall record the same and execute not less than two copies of such Assignment and Acceptance Agreement in the appropriate place, deliver one such copy to the assignor and one such copy to the assignee, and deliver one photocopy thereof, as executed, to the Parent Borrower, the Swing Line Lender and the Issuing Bank. From and after the effective date specified in such Assignment and Acceptance Agreement, the assignee thereunder shall be a party hereto and shall for all purposes of this Agreement and the other Loan Documents be deemed a "Lender" and, to the extent provided in such Assignment and Acceptance Agreement, the assignor Lender thereunder shall be released from its obligations under this Agreement and the other Loan Documents. The Administrative Agent shall be entitled to rely upon the representations and warranties made by the assignee under each Assignment and Acceptance Agreement. (c) In addition to the participations provided for in Section 11.10(a), each Lender may grant participations in all or any part of its rights under the Loan Documents to one or more Eligible Assignees, provided that (i) such Lender's obligations under this Agreement and the other Loan Documents shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties to this Agreement and the other Loan Documents for the performance of such obligations, (iii) the Credit Parties, the Administrative Agent, the Issuing Bank, the Swing Line Lender and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement and the other Loan Documents, (iv) no sub-participations shall be permitted, (v) neither the granting nor the offering of such participation would require that any additional loss, cost or expense be borne by any Borrower at any time or would require any registration or qualification under any applicable federal or state securities laws, and (vi) the voting rights of any holder of any participation shall be limited to the voting rights of such Lender under Sections 11.1(a), (b), (c) and (d). (d) No Lender shall, as between and among the Credit Parties, the Administrative Agent, the Issuing Bank, the Swing Line Lender and such Lender, as the case may be, be relieved of any of its obligations under the Loan Documents as a result of any Assignment or the granting of any participation in all or any part of its rights under the Loan Documents, except that it shall be relieved of its obligations to the extent of any such Assignment of all or any part of its rights and obligations under the Loan Documents pursuant to Section 11.6(b). (e) Subject to Section 11.6(d), any Lender may at any time or from time to time assign all or any portion of its rights under the Loan Documents to a Federal Reserve Bank, provided that any such assignment shall not release such assignor from its obligations thereunder. 118

11.7. INDEMNITY The Parent Borrower agrees to defend, protect, indemnify, and hold harmless the Administrative Agent, BNY Capital Markets, the Issuing Bank, the Swing Line Lender and each Lender, each of their respective affiliates and each of the respective officers, directors, employees and agents of each of the foregoing (each an "INDEMNIFIED PERSON") from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, claims, costs, expenses and disbursements of any kind or nature whatsoever (including the reasonable fees and disbursements of counsel to such Indemnified Persons in connection with any investigative, administrative or judicial proceeding, whether direct, indirect or consequential and whether based on any federal or state laws or other statutory regulations of any jurisdiction, including securities and commercial laws and regulations, under common law or at equitable cause, or on contract or otherwise, including any liabilities and costs under federal, state or local health or safety laws or environmental laws, regulations, or common law principles, arising from or in connection with the past, present or future operations of the Parent Borrower, any other Credit Party, or their respective predecessors in interest, or the past, present or future environmental condition of the Property of the Parent Borrower or any of its Subsidiaries, the presence of asbestos-containing materials at any such Property, or the release or threatened release of any hazardous substance into the environment from any such Property) in any manner relating to or arising out of the Loan Documents, any commitment letter or fee letter executed and delivered by the Parent Borrower or any of its Subsidiaries and/or the Administrative Agent, the Issuing Bank or the Swing Line Lender, the capitalization of the Parent Borrower or any of its Subsidiaries, the Revolving Credit Commitments, the Swing Line Commitment or the Letter of Credit Commitment, the making of, management of and participation in the Loans or the Reimbursement Obligations, or the use or intended use of the proceeds of the Loans or the Letters of Credit hereunder, provided that the Parent Borrower shall have no obligation under this Section to an Indemnified Person with respect to any of the foregoing to the extent found in a final judgment of a court having jurisdiction to have resulted primarily out of the gross negligence or wilful misconduct of such Indemnified Person or arising solely from claims between one such Indemnified Person and another such Indemnified Person. The indemnity set forth herein shall be in addition to any other obligations or liabilities of the Parent Borrower to each Indemnified Person under the Loan Documents or at common law or otherwise, and shall survive any termination of the Loan Documents, the expiration of the Revolving Credit Commitments, the Swing Line Commitment and the Letter of Credit Commitment and the payment of all Indebtedness under the Loan Documents. 11.8. LIMITATION OF LIABILITY No claim may be made by the Parent Borrower, any of its Subsidiaries, any Lender, the Swing Line Lender, the Issuing Bank or other Person against the Administrative Agent, any Lender, the Swing Line Lender, the Issuing Bank or any 119

directors, officers, employees, or agents of any of them for any special, indirect, consequential or punitive damages in respect of any claim for breach of contract or any other theory of liability arising out of or related to the transactions contemplated by any Loan Document, or any act, omission or event occurring in connection therewith, and each of the Parent Borrower, its Subsidiaries, each Lender, the Swing Line Lender, the Issuing Bank and each such other Person hereby waives, releases and agrees not to sue upon any claim for any such damages, whether or not accrued and whether or not known or suspected to exist in its favor. 11.9. COUNTERPARTS This Agreement may be executed by one or more of the parties thereto on any number of separate counterparts and all of said counterparts taken together shall be deemed to constitute one and the same document. It shall not be necessary in making proof of any Loan Document to produce or account for more than one counterpart signed by the party to be charged. A counterpart of any Loan Document or to any document evidencing, and of any an amendment, modification, consent or waiver to or of any Loan Document transmitted by telecopy shall be deemed to be an originally executed counterpart. A set of the copies of the Loan Documents signed by all the parties thereto shall be deposited with each of the Parent Borrower and the Administrative Agent. Any party to a Loan Document may rely upon the signatures of any other party thereto which are transmitted by telecopy or other electronic means to the same extent as if originally signed. 11.10. ADJUSTMENTS; SET-OFF (a) If any Lender, the Swing Line Lender or the Issuing Bank shall obtain any payment (whether voluntary, involuntary, through the exercise of any right of set-off, or otherwise) on account of its Loans or Reimbursement Obligations in excess of its Outstanding Percentage of payments then due and payable on account of the Loans or Reimbursement Obligations received by all the Lenders, the Swing Line Lender and the Issuing Bank, such Lender, the Swing Line Lender or the Issuing Bank, as the case may be, shall forthwith purchase, without recourse, for cash, from the other Lenders, the Swing Line Lender and the Issuing Bank such participations in their Loans and Reimbursement Obligations as shall be necessary to cause such purchaser to share such excess payment with each of them according to their Outstanding Percentages, PROVIDED, HOWEVER, that if all or any portion of such excess payment is thereafter recovered from such purchaser, such purchase shall be rescinded and the related seller shall repay to such purchaser the purchase price to the extent of such recovery, together with an amount equal to such seller's pro rata share (according to the proportion of (i) the amount of all other related required repayments to (ii) the total amount so recovered from the purchaser) of any interest or other amount paid or payable by the purchaser in respect of the total amount so recovered. 120

(b) In addition to any rights and remedies of each Lender, the Swing Line Lender and the Issuing Bank provided by law, upon the occurrence of an Event of Default and acceleration of the Loans and the Reimbursement Obligations, or at any time upon the occurrence and during the continuance of an Event of Default under Section 9.1(a) or (b), each Lender, the Swing Line Lender and the Issuing Bank shall have the right, without prior notice to any Credit Party, any such notice being expressly waived by each Credit Party to the extent permitted by applicable law, to set-off and apply against any indebtedness or other liability, whether matured or unmatured, of any Credit Party to such Lender, the Swing Line Lender or the Issuing Bank arising under the Loan Documents, any amount owing from such Lender, the Swing Line Lender or the Issuing Bank to such Credit Party. To the extent permitted by applicable law, the aforesaid right of set-off may be exercised by such Lender, the Swing Line Lender or the Issuing Bank against any Credit Party or against any trustee in bankruptcy, custodian, debtor in possession, assignee for the benefit of creditors, receiver, or execution, judgment or attachment creditor of any Credit Party, or against anyone else claiming through or against any Credit Party or such trustee in bankruptcy, custodian, debtor in possession, assignee for the benefit of creditors, receivers, or execution, judgment or attachment creditors, notwithstanding the fact that such right of set-off shall not have been exercised by such Lender, the Swing Line Lender or the Issuing Bank prior to the making, filing or issuance of, service upon such Lender, the Swing Line Lender or the Issuing Bank of, or notice to such Lender, the Swing Line Lender or the Issuing Bank of, any petition, assignment for the benefit of creditors, appointment or application for the appointment of a receiver, or issuance of execution, subpoena, order or warrant. Each Lender, the Swing Line Lender and the Issuing Bank agrees promptly to notify the Parent Borrower and the Administrative Agent after each such set-off and application made by such Lender, the Swing Line Lender or the Issuing Bank, as the case may be, provided that the failure to give such notice shall not affect the validity of such set-off and application. 11.11. CONSTRUCTION Each party to a Loan Document represents that it has been represented by counsel in connection with the Loan Documents and the transactions contemplated thereby and that the principle that agreements are to be construed against the party drafting the same shall be inapplicable. 11.12. GOVERNING LAW The Loan Documents and the rights and obligations of the parties thereunder shall be governed by, and construed and interpreted in accordance with, the internal laws of the State of New York, without regard to principles of conflict of laws, but including Section 5-1401 of the General Obligations Law. 121

11.13. JUDGMENT CURRENCY (a) Each Credit Party's obligations under the Loan Documents to make payments in the applicable Currency (the "OBLIGATION CURRENCY") shall not be discharged or satisfied by any tender or recovery pursuant to any judgment expressed in or converted into any currency other than the Obligation Currency, except to the extent that, on the Business Day immediately following the date of such tender or recovery, the Administrative Agent, the Issuing Bank, the Swing Line Lender or the applicable Lender, as the case may be, may, in accordance with normal banking procedures, purchase the Obligation Currency with such other currency. If for the purpose of obtaining or enforcing judgment against any Credit Party in any court or in any jurisdiction, it becomes necessary to convert into any currency other than the Obligation Currency (such other currency being hereinafter referred to as the "JUDGMENT CURRENCY") an amount due in the Obligation Currency, the conversion shall be made at the rate of exchange at which, in accordance with normal banking procedures in the relevant jurisdiction, the Obligation Currency could be purchased with the Judgment Currency as of the day immediately preceding the day on which the judgment is given (such Business Day being hereinafter referred to as the "JUDGMENT CURRENCY CONVERSION DATE"). (b) If the amount of Obligation Currency purchased pursuant to the last sentence of Section 11.14(a) is less than the sum originally due in the Obligation Currency, the applicable Credit Party covenants and agrees to indemnify the applicable recipient against such loss, and if the Obligation Currency so purchased exceeds the sum originally due to such recipient, such recipient agrees to remit to the applicable Credit Party such excess. 11.14. INTERNATIONAL BANKING FACILITIES (a) The Parent Borrower and the other Credit Parties acknowledge that some or all of the Lenders may, in connection with the Loan Documents, utilize an International banking facility (as defined in Regulation D). (b) Each Credit Party which is an entity located outside the United States (i) understands that it is the policy of the Board of Governors of the Federal Reserve System that deposits received by International banking facilities may be used only to support the non-U.S. operations of a depositor (or its foreign affiliates) located outside the United States and that extensions of credit by International banking facilities may be used only to finance the non-U.S. operations of a customer (or its foreign affiliates) located outside the United States, and (ii) acknowledges that the proceeds of its borrowings hereunder from an international banking facility will be used solely to finance its operations outside the United States, or that of its foreign affiliates. 122

11.15. HEADINGS DESCRIPTIVE Section headings have been inserted in the Loan Documents for convenience only and shall not be construed to be a part thereof. 11.16. SEVERABILITY Every provision of the Loan Documents is intended to be severable, and if any term or provision thereof shall be invalid, illegal or unenforceable for any reason, the validity, legality and enforceability of the remaining provisions thereof shall not be affected or impaired thereby, and any invalidity, illegality or unenforceability in any jurisdiction shall not affect the validity, legality or enforceability of any such term or provision in any other jurisdiction. 11.17. INTEGRATION All exhibits to a Loan Document shall be deemed to be a part thereof. Except for agreements between the Administrative Agent and the Parent Borrower with respect to certain fees, the Loan Documents embody the entire agreement and understanding among the Credit Parties, the Administrative Agent, the Issuing Bank, the Swing Line Lender and the Lenders with respect to the subject matter thereof and supersede all prior agreements and understandings among the Credit Parties, the Administrative Agent, the Issuing Bank, the Swing Line Lender and the Lenders with respect to the subject matter thereof. 11.18. CONSENT TO JURISDICTION Each party to a Loan Document hereby irrevocably submits to the jurisdiction of any New York State or Federal court sitting in the City of New York over any suit, action or proceeding arising out of or relating to the Loan Documents. Each party to a Loan Document hereby irrevocably waives, to the fullest extent permitted or not prohibited by law, any objection which it may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in such a court and any claim that any such suit, action or proceeding brought in such a court has been brought in an inconvenient forum. Each Credit Party hereby agrees that a final judgment in any such suit, action or proceeding brought in such a court, after all appropriate appeals, shall be conclusive and binding upon it. 11.19. SERVICE OF PROCESS Each party to a Loan Document hereby irrevocably consents to the service of process in any suit, action or proceeding by sending the same by first class mail, return receipt requested or by overnight courier service, to the address of such party set forth in Section 11.2 of the applicable Loan Document executed by such party. Each party to a Loan Document hereby agrees that any such service (i) shall be deemed in every respect 123

effective service of process upon it in any such suit, action, or proceeding, and (ii) shall to the fullest extent enforceable by law, be taken and held to be valid personal service upon and personal delivery to it. 11.20. NO LIMITATION ON SERVICE OR SUIT Nothing in the Loan Documents or any modification, waiver, consent or amendment thereto shall affect the right of either Agent or any Lender to serve process in any manner permitted by law or limit the right of the Administrative Agent, the Issuing Bank, the Swing Line Lender or any Lender to bring proceedings against any Credit Party in the courts of any jurisdiction or jurisdictions in which such Credit Party may be served. 11.21. WAIVER OF TRIAL BY JURY EACH OF THE ADMINISTRATIVE AGENT, THE ISSUING BANK, THE SWING LINE LENDER, THE LENDERS AND THE CREDIT PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION ARISING OUT OF, UNDER OR IN CONNECTION WITH THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREIN. FURTHER, EACH CREDIT PARTY HEREBY CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF THE ADMINISTRATIVE AGENT, THE ISSUING BANK, THE SWING LINE LENDER OR THE LENDERS, OR COUNSEL TO THE ADMINISTRATIVE AGENT, THE ISSUING BANK, THE SWING LINE LENDER OR THE LENDERS, HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE ADMINISTRATIVE AGENT, THE ISSUING BANK, THE SWING LINE LENDER OR THE LENDERS WOULD NOT, IN THE EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL PROVISION. EACH CREDIT PARTY ACKNOWLEDGES THAT THE ADMINISTRATIVE AGENT, THE ISSUING BANK, THE SWING LINE LENDER AND THE LENDERS HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, INTER ALIA, THE PROVISIONS OF THIS SECTION. 11.22. PARENT BORROWER AS AGENT FOR SUBSIDIARY BORROWERS Each Subsidiary Borrower hereby irrevocably designates and appoints the Parent Borrower as its agent under the Loan Documents and such Subsidiary Borrower hereby irrevocably authorizes the Parent Borrower to take such action on its behalf under the provisions of the Loan Documents and to exercise such powers and perform such duties as are expressly delegated to the Parent Borrower by the terms of the Loan Documents, together with such other powers as are reasonably incidental thereto. 124

IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written. VALMONT INDUSTRIES, INC. By: --------------------------- Name: ------------------------- Title: ------------------------ 125

THE BANK OF NEW YORK, Individually, as Administrative Agent, as Issuing Bank and as Swing Line Lender By: --------------------------- Name: ------------------------- Title: ------------------------ 126

COOPERATIEVE CENTRALE RAIFFEISEN - BOERENLEENBANK B.A, "RABOBANK NEDERLAND", NEW YORK BRANCH By: --------------------------- Name: ------------------------- Title: ------------------------ 127

CREDIT LYONNAIS CHICAGO BRANCH By: --------------------------- Name: ------------------------- Title: ------------------------ 128

BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION By: --------------------------- Name: ------------------------- Title: ------------------------ 129

THE BANK OF NOVA SCOTIA By: --------------------------- Name: ------------------------- Title: ------------------------ 130

U.S. BANK NATIONAL ASSOCIATION d/b/a FIRST BANK, N.A. By: --------------------------- Name: ------------------------- Title: ------------------------ 131

WACHOVIA BANK, N.A. By: --------------------------- Name: ------------------------- Title: ------------------------ 132

VALMONT INDUSTRIES, INC. AMENDMENT NO. 1 TO CREDIT AGREEMENT AMENDMENT NO. 1 (this "AMENDMENT"), dated as of April 15, 1998, to the Credit Agreement, dated as of October 7, 1997, by and among VALMONT INDUSTRIES, INC., a Delaware corporation (the "PARENT BORROWER"), the Subsidiary Borrowers party thereto, the Lenders party hereto, and The Bank of New York, as Issuing Bank, as Swing Line Lender and as Administrative Agent for the Lenders, the Issuing Bank and the Swing Line Lender (in such capacity, the "ADMINISTRATIVE AGENT")(the "CREDIT AGREEMENT"). RECITALS I. Capitalized terms used herein which are not otherwise defined herein shall have the respective meanings ascribed thereto in the Credit Agreement. II. The Parent Borrower has requested that the Credit Agreement be amended to add the Parent Borrower as a French Borrower upon the terms and conditions contained herein, and the Administrative Agent and the Lenders are willing to so agree. Accordingly, in consideration of the Recitals and the covenants and conditions hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto hereby agree as follows: 12. SECTION 1.1 OF THE CREDIT AGREEMENT IS HEREBY AMENDED TO AMEND AND RESTATE IN ITS ENTIRETY THE DEFINITION OF "FRENCH BORROWER" AS FOLLOWS: "FRENCH BORROWER": (i) the Parent Borrower or (ii) any other Borrower which is organized under the laws of, and has its principal office in, France. 13. SECTION 3.9 OF THE CREDIT AGREEMENT IS HEREBY AMENDED TO AMEND AND RESTATE IN ITS ENTIRETY SUBSECTION (D) THEREOF AS FOLLOWS: (d) EXCEPTION FOR EXISTING TAXES. No amount shall be required to be paid to any Indemnified Tax Person under Section 3.9(a) or (b) with respect to any Indemnified Tax to the extent that such Indemnified Tax would have been required to have been paid under any law, rule, regulation, order, directive, treaty or guideline in effect on (i) the date of the applicable Bid, in the case of any Bid Loan, (ii) the date of the applicable Borrowing Request, in the case of any Swing Line Loan, and (iii) the Relevant Date, in all other cases, except in each such case to the extent that such Indemnified Tax shall be attributable to any sum paid or 133

payable by any Credit Party under the Loan Documents in respect of any Loan denominated in a Currency other than the Currency of the jurisdiction in which the applicable Borrower has been organized and in which it has its principal office. 14. ON THE DATE HEREOF, EACH CREDIT PARTY HEREBY (A) REAFFIRMS AND ADMITS THE VALIDITY AND ENFORCEABILITY OF THE LOAN DOCUMENTS (AS AMENDED BY THIS AMENDMENT) AND ALL OF ITS OBLIGATIONS THEREUNDER, (B) AGREES AND ADMITS THAT IT HAS NO DEFENSES TO OR OFFSETS AGAINST ANY SUCH OBLIGATION, AND (C) REPRESENTS AND WARRANTS THAT, IMMEDIATELY BEFORE AND AFTER GIVING EFFECT TO THIS AMENDMENT, NO DEFAULT OR EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING AND EACH OF THE REPRESENTATIONS AND WARRANTIES MADE BY IT IN THE LOAN DOCUMENTS (AS MODIFIED BY THIS AMENDMENT) TO WHICH IT IS A PARTY IS TRUE AND CORRECT WITH THE SAME EFFECT AS THOUGH SUCH REPRESENTATION AND WARRANTY HAD BEEN MADE ON THE DATE HEREOF. 15. IN ALL OTHER RESPECTS, THE LOAN DOCUMENTS SHALL REMAIN IN FULL FORCE AND EFFECT, AND NO MODIFICATION IN RESPECT OF ANY TERM OR CONDITION OF ANY LOAN DOCUMENT CONTAINED HEREIN SHALL BE DEEMED TO BE A MODIFICATION IN RESPECT OF ANY OTHER TERM OR CONDITION CONTAINED IN ANY LOAN DOCUMENT. 16. THIS AMENDMENT MAY BE EXECUTED IN ANY NUMBER OF COUNTERPARTS ALL OF WHICH, TAKEN TOGETHER, SHALL CONSTITUTE ONE AMENDMENT. IN MAKING PROOF OF THIS AMENDMENT, IT SHALL ONLY BE NECESSARY TO PRODUCE THE COUNTERPART EXECUTED AND DELIVERED BY THE PARTY TO BE CHARGED. 17. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS, BUT INCLUDING SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW. AS EVIDENCE of the agreement by the parties hereto to the terms and conditions herein contained, each such party has caused this Amendment to be executed on its behalf. 134

VALMONT INDUSTRIES, INC. By: --------------------------- Name: ------------------------- Title: ------------------------ THE BANK OF NEW YORK, Individually, as Administrative Agent, as Issuing Bank and as Swing Line Lender By: --------------------------- Name: ------------------------- Title: ------------------------ COOPERATIEVE CENTRALE RAIFFEISEN - BOERENLEENBANK B.A, "RABOBANK NEDERLAND", NEW YORK BRANCH By: --------------------------- Name: ------------------------- Title: ------------------------ By: --------------------------- Name: ------------------------- Title: ------------------------ CREDIT LYONNAIS CHICAGO BRANCH By: --------------------------- Name: ------------------------- Title: ------------------------ 135

BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION By: --------------------------- Name: ------------------------- Title: ------------------------ THE BANK OF NOVA SCOTIA By: --------------------------- Name: ------------------------- Title: ------------------------ U.S. BANK NATIONAL ASSOCIATION d/b/a FIRST BANK, N.A. By: --------------------------- Name: ------------------------- Title: ------------------------ WACHOVIA BANK, N.A. By: --------------------------- Name: ------------------------- Title: ------------------------ 136

AGREED AND CONSENTED TO: AMERICAN LIGHTING STANDARDS CORPORATION By: --------------------------- Name: ------------------------- Title: ------------------------ MICROFLECT COMPANY, INC. By: --------------------------- Name: ------------------------- Title: ------------------------ VALMONT INTERNATIONAL CORP. By: --------------------------- Name: ------------------------- Title: ------------------------ 137

AMENDMENT NO. 2 AMENDMENT NO. 2 (this "AMENDMENT"), dated as of July 24, 1998, to the Credit Agreement, dated as of October 7, 1997, by and among Valmont Industries, Inc., the Subsidiary Borrowers party thereto, the Lenders party thereto and The Bank of New York, as Issuing Bank, as Swing Line Lender and as Administrative Agent (as amended, the "AGREEMENT"). RECITALS I. Capitalized terms used herein which are not otherwise defined herein shall have the respective meanings ascribed thereto in the Agreement. II. The Parent Borrower has requested that the Administrative Agent agree to amend the Agreement upon the terms and conditions contained herein, and the Administrative Agent is willing so to agree. Accordingly, in consideration of the Recitals and the terms and conditions hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parent Borrower and the Administrative Agent hereby agree as follows: 18. THE DEFINITION OF "CONSOLIDATED FIXED CHARGES" CONTAINED IN SECTION 1.1 OF THE AGREEMENT IS AMENDED BY AMENDING AND RESTATING CLAUSE (III) OF SUCH DEFINITION IN ITS ENTIRETY AS FOLLOWS: (iii) all Restricted Payments made pursuant to Section 8.7(c)(ii) in cash during such period by the Parent Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP. 19. SECTION 8.7 OF THE AGREEMENT IS AMENDED BY (A) DELETING THE WORD "AND" AT THE END OF CLAUSE (B) OF SUCH SECTION, (B) INSERTING THE WORD "AND" IMMEDIATELY AFTER THE WORD "YEAR" IN CLAUSE (C) OF SUCH SECTION AND (C) ADDING A NEW CLAUSE (D) TO SUCH SECTION AS FOLLOWS: (d) other Restricted Payments made on or before July 31, 1999 in connection with the redemption, retirement, sinking fund or similar payment, purchase or other acquisition of shares of the Parent Borrower's common stock, provided that, (i) immediately before and after giving effect thereto, no Default shall or would exist, and (ii) the aggregate amount of all such Restricted Payments referred to in this clause (d) shall not exceed $54,000,000. 138

20. PARAGRAPHS 1 AND 2 OF THIS AMENDMENT SHALL NOT BE EFFECTIVE UNTIL SUCH TIME AS THE REQUIRED LENDERS SHALL HAVE CONSENTED IN WRITING TO THIS AMENDMENT. 21. THE PARENT BORROWER HEREBY (A) REAFFIRMS AND ADMITS THE VALIDITY AND ENFORCEABILITY OF EACH LOAN DOCUMENT AND ALL OF THE OBLIGATIONS OF EACH CREDIT PARTY THEREUNDER, (B) AGREES AND ADMITS THAT NO CREDIT PARTY HAS ANY DEFENSES TO OR OFFSETS AGAINST ANY SUCH OBLIGATION AND (C) CERTIFIES THAT, IMMEDIATELY AFTER GIVING EFFECT TO PARAGRAPHS 1 AND 2 OF THIS AMENDMENT, (I) NO DEFAULT SHALL EXIST AND (II) EACH OF THE REPRESENTATIONS AND WARRANTIES CONTAINED IN EACH LOAN DOCUMENT SHALL BE TRUE AND CORRECT WITH THE SAME EFFECT AS THOUGH SUCH REPRESENTATION AND WARRANTY HAD BEEN MADE ON SUCH BORROWING DATE, EXCEPT TO THE EXTENT SUCH REPRESENTATION AND WARRANTY SPECIFICALLY RELATES TO AN EARLIER DATE, IN WHICH CASE SUCH REPRESENTATION AND WARRANTY SHALL HAVE BEEN TRUE AND CORRECT ON AND AS OF SUCH EARLIER DATE. 22. IN ALL OTHER RESPECTS, THE LOAN DOCUMENTS SHALL REMAIN IN FULL FORCE AND EFFECT, AND NO AMENDMENT IN RESPECT OF ANY TERM OR CONDITION OF ANY LOAN DOCUMENT SHALL BE DEEMED TO BE AN AMENDMENT IN RESPECT OF ANY OTHER TERM OR CONDITION CONTAINED IN ANY LOAN DOCUMENT. 23. THIS AMENDMENT MAY BE EXECUTED IN ANY NUMBER OF COUNTERPARTS ALL OF WHICH, TAKEN TOGETHER, SHALL CONSTITUTE ONE AGREEMENT. IN MAKING PROOF OF THIS AMENDMENT, IT SHALL ONLY BE NECESSARY TO PRODUCE THE COUNTERPART EXECUTED AND DELIVERED BY THE PARTY TO BE CHARGED. 24. THIS AMENDMENT IS BEING EXECUTED AND DELIVERED IN, AND IS INTENDED TO BE PERFORMED IN, THE STATE OF NEW YORK AND SHALL BE CONSTRUED AND ENFORCEABLE IN ACCORDANCE WITH, AND BE GOVERNED BY, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS. 139

AS EVIDENCE of the agreement by the parties hereto to the terms and conditions herein contained, each such party has caused this Amendment to be executed on its behalf. VALMONT INDUSTRIES, INC. By: --------------------------- Name: ------------------------- Title: ------------------------ THE BANK OF NEW YORK, individually, as Issuing Bank, as Swing Line Lender and as as Administrative Agent By: --------------------------- Name: ------------------------- Title: ------------------------ Consented to and agreed: COOPERATIEVE CENTRALE RAIFFEISEN - BOERENLEENBANK B.A, "RABOBANK NEDERLAND", NEW YORK BRANCH By: -------------------------------- Name: ------------------------------ Title: ----------------------------- By: -------------------------------- Name: ------------------------------ Title: ----------------------------- 140

VALMONT INDUSTRIES, INC. CREDIT LYONNAIS CHICAGO BRANCH By: -------------------------------- Name: ------------------------------ Title: ----------------------------- BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION By: -------------------------------- Name: ------------------------------ Title: ----------------------------- THE BANK OF NOVA SCOTIA By: -------------------------------- Name: ------------------------------ Title: ----------------------------- U.S. BANK NATIONAL ASSOCIATION d/b/a FIRST BANK, N.A. By: -------------------------------- Name: ------------------------------ Title: ----------------------------- WACHOVIA BANK, N.A. By: -------------------------------- Name: ------------------------------ Title: ----------------------------- 141

VALMONT INDUSTRIES, INC. AMERICAN LIGHTING STANDARDS CORPORATION By: -------------------------------- Name: ------------------------------ Title: ----------------------------- MICROFLECT COMPANY, INC. By: -------------------------------- Name: ------------------------------ Title: ----------------------------- VALMONT INTERNATIONAL CORP. By: -------------------------------- Name: ------------------------------ Title: ----------------------------- 142

VALMONT INDUSTRIES, INC. AMENDMENT NO. 3 AMENDMENT NO. 3 (this "AMENDMENT"), dated as of February 5, 1999, to the Credit Agreement, dated as of October 7, 1997, by and among Valmont Industries, Inc., the Subsidiary Borrowers party thereto, the Lenders party thereto and The Bank of New York, as Issuing Bank, as Swing Line Lender and as Administrative Agent (as amended, the "AGREEMENT"). RECITALS III. Capitalized terms used herein which are not otherwise defined herein shall have the respective meanings ascribed thereto in the Agreement. IV. The Parent Borrower has requested that the Administrative Agent agree to amend the Agreement upon the terms and conditions contained herein, and the Administrative Agent is willing so to agree. Accordingly, in consideration of the Recitals and the terms and conditions hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parent Borrower and the Administrative Agent hereby agree as follows: 25. SECTION 8.7 OF THE AGREEMENT IS AMENDED BY (A) DELETING THE WORD "AND" AT THE END OF CLAUSE (C) OF SUCH SECTION, (B) INSERTING THE WORD "AND" IMMEDIATELY AFTER THE AMOUNT "$54,000,000" IN CLAUSE (D) OF SUCH SECTION AND (C) ADDING A NEW CLAUSE (E) TO SUCH SECTION AS FOLLOWS: (e) other Restricted Payments made in connection with the redemption, retirement, sinking fund or similar payment, purchase or other acquisition of shares of the Parent Borrower's common stock, provided that, (i) immediately before and after giving effect thereto, no Default shall or would exist, and (ii) the aggregate amount of shares of the Parent Borrower's common stock subject to all such redemptions, retirements, sinking fund or similar payments, purchases and other acquisitions referred to in this clause (e) shall not exceed 2,277,840. 26. PARAGRAPH 1 OF THIS AMENDMENT SHALL NOT BE EFFECTIVE UNTIL SUCH TIME AS THE REQUIRED LENDERS SHALL HAVE CONSENTED IN WRITING TO THIS AMENDMENT. 27. THE PARENT BORROWER HEREBY (A) REAFFIRMS AND ADMITS THE VALIDITY AND ENFORCEABILITY OF EACH LOAN DOCUMENT AND ALL OF THE OBLIGATIONS OF EACH CREDIT PARTY THEREUNDER, (B) AGREES AND ADMITS THAT NO CREDIT PARTY HAS ANY DEFENSES TO OR 143

OFFSETS AGAINST ANY SUCH OBLIGATION AND (C) CERTIFIES THAT, IMMEDIATELY AFTER GIVING EFFECT TO PARAGRAPH 1 OF THIS AMENDMENT, (I) NO DEFAULT SHALL EXIST AND (II) EACH OF THE REPRESENTATIONS AND WARRANTIES CONTAINED IN EACH LOAN DOCUMENT SHALL BE TRUE AND CORRECT WITH THE SAME EFFECT AS THOUGH SUCH REPRESENTATION AND WARRANTY HAD BEEN MADE ON SUCH BORROWING DATE, EXCEPT TO THE EXTENT SUCH REPRESENTATION AND WARRANTY SPECIFICALLY RELATES TO AN EARLIER DATE, IN WHICH CASE SUCH REPRESENTATION AND WARRANTY SHALL HAVE BEEN TRUE AND CORRECT ON AND AS OF SUCH EARLIER DATE. 28. IN ALL OTHER RESPECTS, THE LOAN DOCUMENTS SHALL REMAIN IN FULL FORCE AND EFFECT, AND NO AMENDMENT IN RESPECT OF ANY TERM OR CONDITION OF ANY LOAN DOCUMENT SHALL BE DEEMED TO BE AN AMENDMENT IN RESPECT OF ANY OTHER TERM OR CONDITION CONTAINED IN ANY LOAN DOCUMENT. 29. THIS AMENDMENT MAY BE EXECUTED IN ANY NUMBER OF COUNTERPARTS ALL OF WHICH, TAKEN TOGETHER, SHALL CONSTITUTE ONE AGREEMENT. IN MAKING PROOF OF THIS AMENDMENT, IT SHALL ONLY BE NECESSARY TO PRODUCE THE COUNTERPART EXECUTED AND DELIVERED BY THE PARTY TO BE CHARGED. 30. THIS AMENDMENT SHALL BE EFFECTIVE AS OF FEBRUARY 5, 1999. 31. THIS AMENDMENT IS BEING EXECUTED AND DELIVERED IN, AND IS INTENDED TO BE PERFORMED IN, THE STATE OF NEW YORK AND SHALL BE CONSTRUED AND ENFORCEABLE IN ACCORDANCE WITH, AND BE GOVERNED BY, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS. 144

VALMONT INDUSTRIES, INC. VALMONT INDUSTRIES, INC. AMENDMENT NO. 3 AS EVIDENCE of the agreement by the parties hereto to the terms and conditions herein contained, each such party has caused this Amendment to be executed on its behalf. VALMONT INDUSTRIES, INC. By: --------------------------- Name: ------------------------- Title: ------------------------ THE BANK OF NEW YORK, individually, as Issuing Bank, as Swing Line Lender and as as Administrative Agent By: --------------------------- Name: ------------------------- Title: ------------------------ Consented to and agreed: COOPERATIEVE CENTRALE RAIFFEISEN - BOERENLEENBANK B.A, "RABOBANK NEDERLAND", NEW YORK BRANCH By: -------------------------------- Name: ------------------------------ Title: ----------------------------- By: -------------------------------- Name: ------------------------------ Title: ----------------------------- 145

VALMONT INDUSTRIES, INC. VALMONT INDUSTRIES, INC. AMENDMENT NO. 3 CREDIT LYONNAIS CHICAGO BRANCH By: -------------------------------- Name: ------------------------------ Title: ----------------------------- BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION By: -------------------------------- Name: ------------------------------ Title: ----------------------------- THE BANK OF NOVA SCOTIA By: -------------------------------- Name: ------------------------------ Title: ----------------------------- U.S. BANK NATIONAL ASSOCIATION d/b/a FIRST BANK, N.A. By: -------------------------------- Name: ------------------------------ Title: ----------------------------- WACHOVIA BANK, N.A. By: -------------------------------- Name: ------------------------------ Title: ----------------------------- 146

VALMONT INDUSTRIES, INC. VALMONT INDUSTRIES, INC. AMENDMENT NO. 3 AMERICAN LIGHTING STANDARDS CORPORATION By: -------------------------------- Name: ------------------------------ Title: ----------------------------- MICROFLECT COMPANY, INC. By: -------------------------------- Name: ------------------------------ Title: ----------------------------- VALMONT INTERNATIONAL CORP. By: -------------------------------- Name: ------------------------------ Title: ----------------------------- 147

Exhibit 13 Valmont 1998 Annual Report Text Only for SCC 148

(FRONT COVER) Irrigation Industry Infrastructure Image Street light/traffic light combination pole Valmont Logo 1998 Annual Report Image Linear irrigator 149

(INSIDE FRONT COVER) Contents 1 FINANCIAL HIGHLIGHTS 2 LETTER TO FELLOW SHAREHOLDERS 5 TOTAL VALUE IMPACT 6 AT A GLANCE 8 WHERE WE ARE 10 IRRIGATION 14 INFRASTRUCTURE 18 INDUSTRY 22 VALUE OF VALMONT 24 STRATEGIES FOR GROWTH 24 EXPANDING AROUND THE WORLD 25 HOW VALMONT GOES TO MARKET 25 PILLARS FOR ECONOMIC GROWTH 28 FINANCIAL OBJECTIVES AND RESULTS 29 MANAGEMENT'S DISCUSSION & ANALYSIS 34 SELECTED 11-YEAR FINANCIAL DATA 36 CONSOLIDATED STATEMENTS OF OPERATIONS 37 CONSOLIDATED BALANCE SHEETS 38 CONSOLIDATED STATEMENTS OF CASH FLOWS 39 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY 40 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 45 BUSINESS SEGMENT INFORMATION 46 QUARTERLY FINANCIAL DATA 47 INDEPENDENT AUDITORS' REPORT 47 REPORT OF MANAGEMENT 48 OFFICERS AND MANAGEMENT 48 SHAREHOLDER INFORMATION 49 BOARD OF DIRECTORS Management's Discussion and Analysis contains forward looking statements which reflect management's current view and estimates of future economic and market circumstances, industry conditions, company performance and financial results. The statements are based on many assumptions and factors including operating efficiencies, availability and price of raw materials, availability and market acceptance of new products, product pricing, domestic and international competitive environments, actions and policy changes of domestic and international governments, and other risks described from time to time in Valmont's reports to the Securities and Exchange Commission. Any changes in such assumptions or factors could produce significantly different results. 150

PAGE 1 FINANCIAL HIGHLIGHTS [DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS] OPERATING RESULTS AND RATIOS ARE BEFORE 1996 ASSET VALUATION CHARGE. OPERATING RESULTS 1998 1997 1996 - ---------------------------------------------------------------------------------------------------------------------------------- Net sales $606.3 $622.5 $644.5 Net earnings 27.6 37.5 31.3 Diluted earnings per share 1.02 1.33 1.12 Dividends per share 0.25125 0.21875 0.1875 FINANCIAL POSITION Shareholders' equity $175.9 $207.1 $175.2 Shareholders' equity per share 7.12 7.49 6.41 Long-term debt as a % of invested capital 30.3% 10.4% 12.1% OPERATING RATIOS Gross profit as a % of net sales 25.2% 27.2% 26.7% Operating income as a % of net sales 7.9% 10.0% 8.1% Net earnings as a % of net sales 4.6% 6.0% 4.9% Return on beginning equity 13.3% 21.4% 19.7% Return on invested capital 10.3% 15.4% 14.7% YEAR-END DATA Shares outstanding (000) 24,721 27,641 27,330 Approximate number of shareholders 5,500 5,400 4,400 Number of employees 3,869 3,751 4,868 Graph NET SALES - --------- 1994 $502 1995 $545 1996 $645 1997 $623 1998 $606 Graph DILUTED EARNINGS PER SHARE - -------------------------- 1994 $.69 1995 $.90 1996 $1.12 1997 $1.33 1998 $1.02 Graph Return on invested capital - -------------------------- 1994 10.7% 1995 13.0% 1996 14.7% 1997 15.4% 1998 10.3% 151

PAGE 2 Letter to fellow shareholders Photo Man with elbow on table. Caption: MOGENS C. BAY CHAIRMAN AND CHIEF EXECUTIVE OFFICER In last year's annual report I predicted that 1998 would be yet another record year for your company. I was wrong! 1998 was a reminder that some of our businesses are cyclical and when they hit a down cycle, earnings and sales growth targets will not be met. It also proved to us, however, that our diversification efforts are paying off. We had strong performance in our coatings businesses, a good year in our European lighting and traffic pole businesses and another year of sales growth in our international irrigation business lead by a banner year in Brazil. Despite having a difficult first half in the North American pole businesses, a soft second half in the North American irrigation business, and a lackluster year in our wireless communication business worldwide, we still delivered the third highest earnings in the company's history. In 1998, we met two of our three financial objectives. Our after-tax return on invested capital was 10.3%, exceeding our target of 10%. Our debt to total invested capital at 30% remained well under our comfort level of 40%. This, despite spending over $50 million buying back Valmont stock, illustrates our businesses' ability to generate cash. But our most important objective, earnings per share growth, was not met in 1998, as our earnings dropped 23%. I must emphasize that our earnings growth target is a "trendline" target and that Valmont's earnings per share have grown 14% compounded annually over the past five years. That is a healthy performance for any manufacturing company. Whenever we experience a bump in the road, as we did in 1998, it makes us sit back and re-evaluate the underlying drivers of our businesses. We need to be comfortable that this truly is just a bump in the road and not an early sign that we might be heading down a rocky road. When we examine the long-term factors that relate to Valmont's irrigation business, this year's events highlight what we know about population increases and dietary improvement. Increased population and economic improvement spark the demand for more and better food. For example, the Asian region experienced increased prosperity and growth until the summer of 1997, and until then they did what was expected--increased imports of grain and meat to improve their diets. 152

PAGE 3 The Asian financial crisis slowed that trend, but the long-term outlook remains in place. To increase food production with limited water and land resources farmers must become ever more efficient. Mechanized irrigation is one of the best ways to improve farmers' efficiency. Our infrastructure businesses also have strong fundamentals. Whether it is more lighting or better signs and signals, the underlying desire for increased highway safety and less traffic congestion drive the demand for Valmont's pole products. And, to increase capacity and service reliability in the electric utility industry, it will take the type of high quality steel-engineered transmission and distribution poles that are Valmont's hallmark. Graph DILUTED EARNINGS PER SHARE Actual 15% Target - ------ ---------- 1993 $0.54 $0.54 1994 $0.69 $0 62 1995 $0.90 $0.71 1996 $1.12 $0.82 1997 $1.33 $0.94 1998 $1.02 $1.09 Valmont's compounded annual earnings growth rate over the last five years is 14 percent. The wireless communication industry is yet another good example of why we reiterate that, in spite of short-term market dynamics, the long-term drivers in our businesses are strong. When you weigh the rapid growth of the wireless communication industry in the U.S. and around the world and see how well the technology has been accepted, you cannot help but be enthused about the long-term outlook for this popular and convenient technology. The next level of growth for this industry should come from improved service and global expansion. In order to achieve better levels of service, wireless providers will need more towers, poles, and components to expand their networks. 153

PAGE 4 A `Thank You' to the Valmont Team Whenever an organization is faced with less favorable market conditions than you had planned, it must contend with greater levels of stress. Cost containment and downsizing become necessary to protect the corporation's earnings to the fullest extent possible. Yet, customers continue to deserve exceptional service even when fewer resources are available. The Valmont team has met this challenge admirably, working long hours and finding more efficient ways to get the job done. I thank them for a great effort under difficult circumstances. "We are confident that we are focused on the right businesses: water management for agriculture and engineered structures and services for infrastructure development." In closing, while we are not satisfied with the operating results for 1998, we are confident that we are focused on the right businesses: water management for agriculture and engineered structures and services for infrastructure development. Business conditions could have been better in 1998, however, the long-term drivers for all of our businesses are positive. We intend to vigilantly pursue every opportunity to grow our core businesses while building shareholder value. Signature /s/ Mogens C. Bay - ------------------------------------ Mogens C. Bay Chairman and Chief Executive Officer 154

PAGE 5 TOTAL VALUE IMPACT "TVI motivates managers to think like shareholders." Total Value Impact (TVI) is more than a concept at Valmont. In 1994, TVI--Valmont's unique formulation and application of the business philosophy of value-added metrics-became the principal tool used in aligning shareholder and management interests. TVI is a measurement designed to enhance shareholder value. Simply put, it is Valmont's net operating profit after taxes minus a 10 percent charge for the capital employed. TVI has placed the efficient management of capital squarely in the limelight for Valmont managers, encouraging them to understand and measure the elements that enhance long-term TVI growth and shareholder value. These elements include the level of margins necessary to earn more than the cost of capital, the amount of capital needed to generate each dollar of sales, and other standard measures such as revenue growth, operating profit margin and invested capital turnover. Because TVI drives Valmont's management compensation bonus plan, results are immediate. Under the Valmont plan, managers who exceed their target TVI can increase their bonuses while managers who fall short do not receive any bonus. The TVI process motivates managers to think like shareholders. Valmont's long history of financial stability and accountability has become increasingly important to our customers, shareholders and employees. It is our goal that each of these constituents continues to receive the value they have come to expect from Valmont. Our annual financial goals are to grow trendline earnings by 15 percent per year, maintain long-term debt at less than 40 percent of invested capital, and achieve a minimum 10 percent after tax return on invested capital. 155

PAGE 6 AT A GLANCE Infrastructure Image Street light/traffic light combination pole STREET & AREA LIGHTING Valmont is the world leader in the manufacture of steel and aluminum lighting and traffic control structures. Valmont's specialized sports lighting structures for stadiums and sports centers can be found in locations around the world. Image Communication pole Image Communication tower COMMUNICATION POLES & TOWERS Valmont produces wireless communication structures and components, including poles and self-supporting towers configured to customer specifications. "Tree poles" and other camouflaged products are designed to blend in with the surrounding environment. Image Electrical poles UTILITY STRUCTURES For the utility industry, Valmont manufactures poles and structures for electrical transmission and distribution, as well as low-profile substation structures. 156

PAGE 7 Irrigation Image Linear irrigator CENTER PIVOT & LINEAR MOVE EQUIPMENT From a fixed point in the field, Valmont's Valley-Registered Trademark- Center Pivot mechanized irrigation equipment rotates in a circular path around the field, evenly distributing water, fertilizer and chemicals. Valley Linear/Universal Linear equipment is designed for long, rectangular or L-shaped fields. Image Water droplet WATER RE-USE Through its Cascade Earth Sciences subsidiary, Valmont offers environmental engineering expertise for soil and water resource management and land application of treated wastewater using mechanized irrigation equipment. Industry Image Galvanized tubing COATINGS Valmont's Coatings Division applies high-quality, galvanized and powder coatings to products and components manufactured by Valmont as well as by other companies. Image Nine stacked pipes INDUSTRIAL PRODUCTS Valmont's Industrial Products Division manufactures standard and customized steel tubing for agriculture and general industry, and precision telescopic covers and conveyors for the machine tool industry. Valmont distributes fastener products for industrial applications and is a leading supplier to the pressure vessel and heat recovery steam generator industries, manufacturing rolled and welded steel cylinders. 157

PAGE 8 WHERE WE ARE Map illustration St. Hubert, Quebec, Canada MANUFACTURING FACILITY: STEEL AND ALUMINUM POLES Long Beach, California, USA GALVANIZING Elkhart, Indiana, USA MANUFACTURING FACILITY: STEEL AND ALUMINUM POLES Omaha, Nebraska, USA Corporate Headquarters Valley, Nebraska, USA MANUFACTURING FACILITY: IRRIGATION EQUIPMENT, STEEL POLES, TUBING, GALVANIZING West Point, Nebraska, USA GALVANIZING Tulsa, Oklahoma, USA MANUFACTURING FACILITY: STEEL POLES, ROLLED AND WELDED STEEL CYLINDERS, GALVANIZING Albany, Oregon, USA HEADQUARTERS, CASCADE EARTH SCIENCES, ENVIRONMENTAL ENGINEERING, EARTH SCIENCES, WATER AND SOIL MANAGEMENT Salem, Oregon, USA MANUFACTURING FACILITY: WIRELESS COMMUNICATION STRUCTURES, PASSIVE REPEATERS, WAVE GUIDE AND ANTENNA SUPPORTING SYSTEMS, FASTENERS Tualatin, Oregon, USA GALVANIZING Brenham, Texas, USA MANUFACTURING FACILITY: STEEL POLES Gunnison, Utah, USA MANUFACTURING FACILITY: COMPOSITE POLES Lindon, Utah, USA GALVANIZING 158

PAGE 9 Map illustration Uberaba, Brazil MANUFACTURING FACILITY: IRRIGATION EQUIPMENT, COMMUNICATION TOWERS Shanghai, China MANUFACTURING FACILITY: STEEL POLES Charmeil, France MANUFACTURING FACILITY: STEEL POLES Creuzier-le-Neuf, France MANUFACTURING FACILITY: INDUSTRIAL COVERS AND CONVEYERS Lempdes, France MANUFACTURING FACILITY: STEEL COMMUNICATION TOWERS Rive-de-Gier, France MANUFACTURING FACILITY: ALUMINUM POLES Gelsenkirchen, Germany MANUFACTURING FACILITY: STEEL POLES Maarheeze, The Netherlands MANUFACTURING FACILITY: STEEL POLES Siedlce, Poland MANUFACTURING FACILITY: STEEL POLES Madrid, Spain MANUFACTURING FACILITY: IRRIGATION EQUIPMENT Valmont is an international manufacturing company with operations around the world. Valmont designs and manufactures mechanized irrigation equipment to enhance food production through efficient water management, as well as poles, towers and structures for lighting, utility and communication applications, and custom coating and fabricated products for various industrial uses. Valmont operates 21 manufacturing plants, located on four continents, and markets its products in more than 100 countries. 159

PAGE 10 Photo Man under linear irrigator Caption: Don Worden, along with sons Tom and Brian, farm 4,000 acres in Washington's southern basin using the Valley(R) pivots he purchased more than 20 years ago. 160

PAGE 11 IRRIGATION "Value for the money we spent." "Washington state's southern basin gets, on average, just seven inches of rainfall per year. And because the soil is fairly fine, it doesn't hold the moisture that a heavier clay-type soil does. So in 1975, I decided to install center pivots on my farm. I talked to the various pivot manufacturers that were around at that time, and the one that made the biggest impression was Valley. "I was looking to place about 32 pivots on about 4,000 acres, and the Valley dealer, Bert Benton in Pasco, gave me good advice and a package deal. They weren't the least expensive systems, but I felt good about dealing with Bert and so did my banker. We've never had a moment of regret. We felt like Valley was a better product-sturdy, galvanized and built to last. "And last they have. Some of our neighbors bought other brands and they have all been replaced by now--so we know we got good value from Valley. Sure we've had to do a little preventive maintenance over the years--and Bert has always been there to help. More than twenty years later, the pivots are working as well as ever-and we're still talking with the same people we bought them from. That means a lot to us." 161

PAGE 12 IRRIGATION WATER: ONE OF OUR MOST VALUABLE RESOURCES Of all the water on earth, only a fraction of one percent is available for human use. Next to air and sunlight, water is our most valuable resource-and the one that is most at risk. Today, more than 1 billion people lack an assured supply of good quality water, (1) and in the next decade the number of countries facing severe water shortages is very likely to increase dramatically. AGRICULTURAL WATER ISSUES Advanced irrigation methods provide a solution to water demand and food supply problems. It is a well-documented fact that irrigated land is more than twice as productive as rain-fed cropland. In the developed world, studies show that irrigation increases yields 50 to 200 percent for most crops. In developing countries, irrigation increases yields for most crops by 100 to 400 percent-yet only about 20 percent of the arable land there is irrigated. Worldwide, only 16 percent of the world's croplands are irrigated, yet these irrigated acres yield some 36 percent of the global harvest. A World Bank study estimates that irrigation could be extended over an additional 270 million acres of land in developing countries, producing enough food each year to feed 1.5 to 2 billion people. Over the next 30 years, experts predict that the current level of food production must double in order to meet the demands of a growing population and improving diets. This increase in production, however, depends on more efficient methods of water management. Many opportunities exist to improve the efficiency of water used in irrigation--and Valmont is best positioned to lead the way. More than half of the future gains in crop production are expected to come from irrigated land. This represents a tremendous growth opportunity for companies like Valmont to lead the charge in demonstrating to growers the value of mechanized irrigation. Valmont is working to provide them with the tools necessary to successfully increase production to meet world agriculture needs. WATER MANAGEMENT: OUR MOST IMPORTANT ROLE Modern mechanized irrigation equipment, such as that designed and manufactured by Valmont, uses up to 50 percent less water and 75 percent less labor than traditional irrigation methods. This equipment also provides superior farm management tools. By replacing flood irrigation methods--which often perform poorly and waste as much as 50 percent of the total water pumped before it reaches the intended crop--producers can increase yields while conserving valuable soil and water resources. Technologies such as those supplied by Valmont--including low pressure irrigation methods, efficient sprinklers, volume control and better irrigation scheduling--are effective in reducing water and energy use, and they are essential in countries where water management is a critical issue. Since agriculture is responsible for some 67 percent of global fresh water use, the potential for water savings through greater efficiency in irrigation is enormous. This translates into a significant potential demand for Valley-Registered Trademark- irrigation products. Photo Arial view of center pivot irrigation Caption: IRRIGATED LAND IS MORE THAN TWICE AS PRODUCTIVE AS RAIN FED CROPLAND. (1) Food and Agriculture Organization of the United Nations; www.fao.org. 162

PAGE 13 LEADING THE WAY WITH INFORMATION-BASED PRECISION IRRIGATION PRODUCTS At Valmont, we understand that our business depends on being good stewards of land and water. As more precision farming methods are adopted, it is necessary to provide irrigation equipment controls and software that are custom-designed for specific crops, varying terrain, water and soil types. Information-based technology is becoming more important as growers adopt more precise methods of farming. We are committed to leading the way with irrigation products that utilize advanced technology and are designed to facilitate water management. In this arena, Valmont has entered into strategic alliances with leading engineering and electronic design firms in order to develop innovations in software, electronics and controls that will lead to technological advances in precision farming. Photo Linear irrigator Caption: Precision application puts water in the crop root zone, eliminating runoff and reducing evaporation losses. Additionally, Valmont is pioneering research in new control and electronic technologies that will, in the future, help producers analyze weather, soil, and crop yield conditions to apply optimal water and chemical amounts. As a leader in these technologies, Valmont is helping producers to use resources more efficiently and move from uniform water and chemical application to non-uniform, precision application--applying the right amount of water and chemicals where needed, not necessarily evenly over the entire field. INNOVATIVE WASTEWATER MANAGEMENT PROCESSES ARE THE WAY OF THE FUTURE As the leading manufacturer of mechanized irrigation equipment, Valmont takes seriously its role in water management issues. In the area of wastewater management, research is providing information about how to re-use treated wastewater for irrigation purposes. Valmont is at the forefront of this research and is positioned to be a leader in providing this technology. For nearly 20 years, Valmont has teamed with the city of Tallahassee, Florida, in a working farm research program to study the effectiveness of irrigating farm crops with treated wastewater. Today, with 13 Valley-Registered Trademark- center pivots, the city of Tallahassee recycles 100 percent of its effluents over 1,800 acres of crop land. The U.S. Environmental Protection Agency, which along with the state agency establishes strict guidelines on the application of wastewater to cropland, calls the project an example of "a state-of-the-art" recycling program that contributes to agricultural resources and pollution prevention. At Valmont, we believe that wastewater management is a key to improved water stewardship worldwide. In 1998, we acquired Cascade Earth Sciences, Ltd. ("CES"), of Albany, Oregon, a firm that specializes in the land application of wastewater. CES is staffed with talented geologists, soil scientists, environmental technicians, and civil, environmental and agricultural engineers. Their expertise gives us the ability to conduct a thorough analysis of soil fertility, wastewater nutrient value, and crop agronomic characteristics to determine the best solutions to wastewater management needs. And, by combining Valley-Registered Trademark- center pivot or linear move machines with wastewater application equipment, we can assure precision and uniformity in the land application of recycled wastewater. The acquisition of CES provides the growth opportunity for Valmont to provide industrial, municipal and agricultural generators of wastewater with turn-key solutions for wastewater management issues. Photo Man standing at back of truck Caption: Computerized control mechanisms help manage electricity loads and maximize water use, allowing producers to tailor water rates for each part of the field. 163

PAGE 14 Photo Man standing under power pole Caption: Tim Johnson is Director of Purchasing for Hawaiian Electric Company, a utility that provides electricity to 98 percent of the state of Hawaii. 164

PAGE 15 INFRASTRUCTURE "This is what strategic partnership is all about ..." "Every company looks for ways to maintain quality but reduce costs--and we're not any different. Our challenge, however, is to do both and increase the standardization of the poles we purchase to transmit our power. That may not sound like a huge task, but consider that we operate in a hot, humid, mountainous environment where the spans are long, loads are heavy, and termites and moisture take their toll on wood poles. "Our specifications are that new poles be made of galvanized steel and although they may contain differing amounts of steel--because of varying load requirements--they all have common components within a family of poles. We have always worked successfully with Valmont, so when we looked for a strategic partner, it made sense to work with someone who understands our challenges. "There are a lot of synergies between our organization and Valmont's, especially in the design and manufacturing stages. We do the initial research--collect information about the terrain, determine the necessary spacing and weights to correspond with height and load requirements, and we share all of that with Valmont. Their engineers and ours work together to come up with a design. Then Valmont manufactures the poles and delivers them to us. "Although we try to avoid timeline-critical projects, we've had a few of them, and Valmont has risen to the task every time. They've arranged for expedited manufacturing and delivery and are helping us figure out how to eliminate future emergencies. This is what a strategic partnership is all about--working together to solve problems and get the job done right--on time and whenever possible, under budget." 165

PAGE 16 INFRASTRUCTURE Keeping pace with global infrastructure development In the coming years, infrastructure expansion is expected to increase in developing nations to meet the demands of newly liberated economies and growing populations. Industrialized nations, in a quest to increase public safety and provide the additional services required in a competitive environment, will seek to add to and upgrade existing infrastructure with durable, long-lasting and more cost-effective products. Valmont continues to invest in new technology that allows us to maintain our leadership positions by improving our pole products and manufacturing processes. Valmont's capabilities to design and manufacture high quality steel and aluminum poles and towers for lighting, traffic, utility and communication applications are aligned with these trends. Electric utility industry: change creates opportunities Shifting political and economic issues are bringing about change to the energy industry in nearly every part of the world. With the opening of economic markets worldwide, countries in Europe, Asia and South America have begun efforts to privatize and deregulate their national electric systems. In the United States, many states have enacted legislation to promote electric utility competition. Isolated power grids that previously supplied electricity to an insular customer base will be interconnected to allow consumers to choose their energy suppliers. The wave of deregulation and increased competition that is sweeping the world's energy markets will translate into lower prices and increased services for consumers. Electric utilities, in order to maintain a competitive edge, must implement more cost-effective ways of doing business. Valmont manufactures high quality transmission structures, distribution poles and substations for the electric utility industry-products for which there will be increased demand as power grids are expanded. In an effort to become more cost-effective, many utilities and energy providers are replacing wooden poles with lighter weight, easier-to-install steel poles that are impervious to termites and wood rot. Steel poles last years longer than wooden poles, and can result in lower total installed costs. Additionally, as worldwide economic and population growth translates into increased housing and commercial development, additional power capacity is needed. Valmont is forming strategic alliances with both in the U.S. and abroad to meet the demand for poles and transmission structures. By working in partnership with our customers, we are able to identify more efficient designs and build products to meet each customer's individual needs and specifications. To assist our strategic partners and other customers in lowering costs, Valmont also provides a variety of coatings and finishes to poles in order to meet the various challenges of climate, terrain and the aesthetic needs of our customers. Photo View of power poles from harvested corn field Caption: TO BECOME MORE COST-EFFECTIVE, MANY UTILITIES ARE REPLACING WOODEN POLES WITH LIGHTER WEIGHT AND EASIER-TO-INSTALL STEEL POLES. 166

PAGE 17 Lighting the way with safer roadways and population centers Another aspect of a growing population base worldwide is the need for more roads and highways. Consumer safety is a top priority for governments and business owners alike. People prefer well-lit parking lots; safely lit streets, freeways and roads; and traffic signals and signs that provide for a smooth flow of traffic. In the U.S., Congress passed the federal highway bill in June of 1998 which provides $204 billion over six years to upgrade the nation's transportation infrastructure. With funding earmarked for both roadway and mass transit enhancements, lighting poles and traffic structures such as those manufactured by Valmont are in greater demand. Photo Target parking lot Caption: CONSUMER SAFETY IS A TOP PRIORITY-AND MORE RETAILERS ARE RECOGNIZING THE LINK BETWEEN WELL-LIT PARKING LOTS AND SALES. Anywhere, any time communications: a world of opportunity In Europe, where tourism is a major industry, spending on infrastructure is also increasing. Custom-designed fluted and decorative poles are particularly popular in European tourist areas. Additionally, sports stadiums and event facilities are being constructed that require specialized, highly engineered lighting structures. In other parts of the world, demand for lighting products is also high. Valmont has located manufacturing facilities throughout Europe, and in China, to meet the growing demand for lighting structures worldwide. Worldwide, mobile wireless infrastructure development slowed in 1998. However, indications are that due to continued advances and capabilities in digital technologies, the wireless segment of the communication industry will soon see renewed opportunities for growth. Some experts predict that within the near future, the wireless phone will also become the home phone in parts of the developing world. This trend will be especially evident in nations that choose to meet customer demands by forgoing the installation of wired lines in favor of newer, less-costly wireless solutions. Privatization of state-owned telecommunications providers in Europe and Asia is also encouraging wireless investment and cellular subscriber growth. As a leading provider of self-supporting communication towers and monopoles, Valmont is poised to benefit from growth in this industry. Camouflaged structures--designed to blend into the environment--and combination poles that can be used for both lighting and wireless communications, are becoming more popular. Valmont has invested in the technology to provide these custom-designed products quickly and cost effectively. To complement our communication tower and pole business, we also manufacture and install component products such as waveguide support systems, antenna supports and rooftop mounting systems. Photo Cactus Caption: CAMOUFLAGED COMMUNICATION POLES BLEND INTO THE ENVIRONMENT. Photo Street light/traffic light combination pole Caption: THE U.S. FEDERAL HIGHWAY BILL, PASSED IN 1998, PROVIDES FUNDING TO UPGRADE THE NATION'S TRANSPORTATION INFRASTRUCTURE. ADDITIONAL TRAFFIC SIGNALS AND SIGNS WILL HELP EASE TRAFFIC CONGESTION AND INCREASE SAFETY. 167

PAGE 18 Photo Man standing under netting/flag pole Caption: DR. LEE SIMMONS IS DIRECTOR OF OMAHA'S HENRY DOORLY ZOO, WHICH RANKS AMONG THE TOP FIVE ZOOS IN THE WORLD. 168

PAGE 19 Industry "A flag that is visible for miles around." "We wanted to make it easy for visitors to find our new Safari Park. Unfortunately, Mother Nature put a hill between us and Interstate 80, so our flagpole would have to be 160 feet high. "There were a couple of other items on our wish list, too. We wanted the pole to be the sole support for our aviary netting and to sustain winches and cables that would allow us to lower the netting to catch a bird. We also wanted to implant a photovoltaic sensor inside the pole to automatically furl and unfurl a 25 X 48-foot flag at dawn, dusk and during bad weather. Naturally, we wanted this all in place by opening day which was less than six weeks away. "Everyone was skeptical at first. But the people at Valmont pulled out all the stops and put me in touch with engineer Carl Macchietto. Keep in mind that this was a totally unique concept...a 16-story, freestanding pole that not only supports an aviary but also accommodates some pretty sophisticated mechanics. A prototype did not exist. "After we finalized the design, it was less than a month before the pole was installed--just hours before we were hit with 108 miles-per-hour winds. The pole swayed in the wind just like you would expect, but it proved to be absolutely sound. It's an amazing feat of engineering and it meets all of our goals." 169

PAGE 20 INDUSTRY Leveraging our strength: quality products for industry A key Valmont strategy is to leverage our manufacturing strengths. As a result we have become a leading supplier of steel tubing, rolled cylinders, fasteners, precision telescopic covers, and custom-finish coatings for industrial use. Industrial products: adding value for industrial customers Valmont has been manufacturing tubing for industrial use--from small-diameter/heavy wall to large-diameter/light wall--for more than 40 years. Our high-speed manufacturing equipment can produce custom-engineered tubing in a wide variety of shapes and sizes built to exacting tolerances. In addition to our internal customers--Valmont's Irrigation and Infrastructure Divisions--our Industrial Products Division provides products and services to a wide variety of customers. We provide standard and custom steel tubing products for use in the manufacture of agricultural equipment, truck and automotive equipment, fire-protection sprinkler applications, fire extinguishers, heat exchangers, and other general fabrication uses. These include structural tubing for the construction industry in squares or rectangles, designed to meet industry physical strength and dimensional requirements. Additionally, the division is a leading supplier of ASME-certified rolled and welded cylinders for use in the manufacture of pressure vessels, boilers and heat recovery steam generators. Industrial fasteners are supplied for Valmont's internal divisions, and for other original equipment manufacturers across the Midwestern and Pacific Northwestern United States. The division also works closely with machine tool manufacturers in Europe in the design and manufacture of auxiliary machine tool equipment such as telescopic covers and conveyors. The Industrial Products Division is focused on adding value to all of its product lines by providing customers with additional fabrication and engineering services keyed to their specific needs. Given the increasing trend throughout the industrial manufacturing market to outsource many of the services provided by Valmont's Industrial Products Division, we expect substantial growth as this division continues to meet the new expectations and requirements of customers. Photo Pneumatic transportation system Caption: VALMONT'S INDUSTRIAL PRODUCTS DIVISION SUPPLIES THIN WALL TUBING USED IN PNEUMATIC TRANSPORTATION SYSTEMS THAT MOVE ITEMS AT SPEEDS OF UP TO 25 FEET PER SECOND. 170

PAGE 21 Coatings: custom protective finishes for industry Since the mid 1960's our manufacturing capabilities have included a hot-dip galvanizing process that coats steel products with a protective zinc coating. Leveraging on this core strength, we formed a separate Coatings Division to provide custom-finish coatings for products and components manufactured by other companies in addition to our own. The galvanizing process helps protect steel against corrosion. Corrosion is estimated to cost the U.S. economy more than $200 billion annually--4.2% of the U.S. gross domestic product. This cost is dramatically reduced when steel is protected through the galvanizing process, which generally lengthens the life of steel by a factor of at least five. By protecting steel from corrosion, new uses for steel are possible, and we expect the demand for galvanizing to increase. For example, telephone poles traditionally built out of wood can now be built at a competitive cost using galvanized poles. In many world areas where deforestation is a problem and natural habitats need to be protected, galvanized steel provides practical alternatives to the harvesting of wood for poles. The opportunities for the future growth of our Coatings Division are many. Today, our Valley, Nebraska plant is the largest galvanizing facility in North America, and we are among the country's largest custom galvanizers. Our Coatings Division is our fastest growing business. During 1998, we acquired four galvanizing operations--in Utah, Oregon, Oklahoma and California--which serve to fulfill our internal needs as well as help meet the growing external demand for galvanizing as a protective coating. Also during 1998, Valmont became the first U.S. galvanizer with multiple plants to achieve ISO 9002 certification. This international certification ensures customers of our commitment to quality standards worldwide--an important competitive advantage. Photo End view of round and square tubing Caption: VALMONT MANUFACTURES ROUND AND SQUARE, LARGE AND SMALL DIAMETER MECHANICAL TUBING FROM THE LIGHTEST TO THE HEAVIEST WALLS IN THE INDUSTRY. Photo Hot dipping pole Caption: HOT DIP GALVANIZING OF STEEL PRODUCTS FORMS A LONG- LASTING, PROTECTIVE COATING AGAINST CORROSION. 171

PAGE 22 Photo Man standing under street light Caption: HUUB SMEETS IS DIRECTOR OF THE DEPARTMENT OF URBAN PLANNING AND DEVELOPMENT FOR THE CITY OF MAASTRICHT IN THE NETHERLANDS. 172

PAGE 23 THE VALUE OF VALMONT "Resplendent past, bright future." "Our city is very progressive. Located in the southern part of Holland, we think of Maastricht as a `springboard' to Europe, as we are only a few kilometres from the borders of both Belgium and Germany. "Historically, Maastricht has always been a centre of industry and trade. During the 19th century, our city was a key military defense location where thousands of ceramic products were made for use by the military and others. Today, Maastricht is still known as the centre of the ceramics industry--and products with renowned brand names such as Royal Sphinx and Royal Mosa find their way to all parts of the world. "In recent years, our key initiative has been the revitalization of our Ceramique area, a 23-hectare region of downtown Maastricht-home to a museum, library, industry, office workers, urban dwellers and all the amenities these groups require. We host more than 15 million visitors to our city each year and it is important that they see our city at its best--resplendent in the culture and history for which we are known. "When we began our renovation, our first step was to rebuild beautiful Ceramique Avenue. We ordered 100 specially selected Valmont aluminum poles which were designed to complement the look of the area. Plus, these poles support high top lights to illuminate the Avenue and at a lower level, support lights for pedestrians and bicyclists. Although Valmont's were not the lowest-priced products or the highest-priced, we believe they were the best choice--extremely high quality and the desired aesthetic appeal. We are now placing 100 more poles on side streets. I think that is a testament to our satisfaction with the product and to Valmont's ability to serve its customers well with style, quality, service, and most importantly, value." 173

PAGE 24 THE VALUE OF VALMONT Our past sets the course for our future What we do best is leverage our expertise--in engineering, manufacturing, and marketing--to build a stronger presence in our global economies. Well-planned strategies for growth The progress of Valmont over the years--from a manufacturer of a single line of center pivot irrigation equipment to a manufacturer of diverse products and components for agricultural and industrial uses--has been methodical and logical. This strategy--of leveraging our strengths and expanding our presence only in viable markets--will continue to drive our success. In the early years, necessity mandated that we fabricate our own tubing and build components from the ground up. Soon, we were the world's leading manufacturer of mechanized irrigation equipment. Valmont's management team began to look for ways to leverage the company's steel fabrication expertise while reducing the company's dependence on agriculture. They recognized the opportunity to manufacture tubing for other industries, and soon began to develop the industrial tubing market for original equipment manufacturers, steel service centers and for use in both private and public projects. Over the years, our skill base in design, engineering, manufacturing and coating continued to grow, and we introduced additional irrigation products that revolutionized the irrigation industry--the corner system, linear move system, low-pressure system, and computerized technology. We expanded into the manufacture of tapered tubes for outdoor lighting and traffic signals, and large tubular structures for the electric utility and communication industries. We found other profitable ways to put our expertise to use. In 1966, we began hot-dip galvanizing our products to provide protection. Today, we are among the largest custom galvanizers in North America. We broadened our position in the communication industry with the acquisition of the Microflect Company in 1995, which enabled us to provide towers, components and installation and maintenance services. We have leveraged our water management expertise as well--putting our irrigation equipment to use in other sectors such as land application of treated wastewater. Our acquisition this year of Cascade Earth Sciences will allow us to offer better solutions to a wide range of agricultural, industrial and municipal customers. Expanding around the world From the beginning, we knew that our products had global appeal and value, and yet we also understood the prudence of careful international investment. We decided early on that if we were to participate in markets overseas, we must also selectively manufacture overseas. In that way--by being closer to our customers--we can ensure that our products are engineered and built to fit specific needs. And by employing local people and supporting their local economies, we are able to become a part of the communities and countries that sustain us. Our Irrigation Division began developing overseas markets in the early 1970's. Licensing agreements were established in Saudi Arabia, Brazil, Yugoslavia, South Africa and the Soviet Union. Soon, Valley-Registered Trademark- pivot and linear move equipment was being sold in Europe, the Middle East, Africa, Australia, China, Thailand and Latin America. Valley-Registered Trademark- irrigation manufacturing facilities are now located in Brazil and Spain, in addition to the U.S. Starting with our first investment in France in 1989, our pole products have also been well received in international markets. In 1991, we acquired two companies; one, a steel pole manufacturer in the Netherlands and the other a Canadian producer of aluminum lighting and traffic poles. During 1996, we completed construction of a facility to manufacture light poles in Shanghai, China, and we purchased a majority interest in a manufacturer of communication towers in France. Also that year, we 174

PAGE 25 purchased a majority interest in a manufacturer and distributor of lighting pole structures in Gelsenkirchen, Germany. In 1997, we started a lighting pole manufacturing facility in Siedlce, Poland. Today, in addition to our six facilities in the U.S., we now manufacture irrigation equipment, poles, tower structures and fabricated products at plants in Germany, Spain, China, Poland, France, the Netherlands, Brazil and Canada. Our future growth will result from doing what we do best: leveraging our talents and strengths and remaining close to our customers. In all of our engineering and manufacturing endeavors, we strive to be the `best cost' producer--to provide the highest-quality products at a fair, competitive price. We are committed to implementing innovations in design and automating our manufacturing processes to provide customized products quickly and cost effectively. This is the value of Valmont and the commitment that our customers deserve and have come to rely on. How Valmont goes to market Valmont's Lighting and Utility products are sold through a network of Valmont sales representatives and agents to utilities, general contractors, city, state and federal entities, and others. To increase sales and customer alliances, our strategy for the future includes: introducing new products customized to meet customer needs; combining product engineering and manufacturing excellence to deliver engineered structures at the best cost; forming additional strategic alliances with key customers and vendors; and expanding our product line through the use of more diverse materials. Valley-Registered Trademark- Irrigation products are marketed through a worldwide network of Valley Irrigation dealers--many of whom have been part of Valmont since the 1960's. Valmont's strategy for increasing sales includes: increasing dealer sales within each marketplace; adding and recruiting new dealers in strategic locations; and encouraging conversion from current flood irrigation practices by providing farmers, producers and influencers with educational information about the value and advantages of mechanized irrigation. As a customer-driven company, Valmont seeks to provide its end users with the information and tools they need in order to be more productive and profitable. We do this by incorporating customer needs into our designs and by ensuring that our representative dealer networks are equipped with new technologies, improved services and the benefits they offer. Pillars for economic growth THE WORLD BANK HAS DETERMINED THAT TO SUSTAIN ECONOMIC GROWTH OUTSIDE THE U.S. AND KEEP PACE WITH FUTURE DEMANDS, FOUR BASIC COMPONENTS MUST BE AVAILABLE: SAFE WATER ELECTRICITY PAVED ROADS TELEPHONES Illustration of pillars VALMONT IS AN INDUSTRY LEADER IN THE MANUFACTURE OF PRODUCTS FOR ALL FOUR OF THESE AREAS. WE ARE THE LEADING PROVIDER OF IRRIGATION AND WASTEWATER MANAGEMENT SYSTEMS THAT WILL HELP ENSURE A SAFE, PLENTIFUL WATER SUPPLY. WE ARE A LEADING MANUFACTURER OF STEEL TRANSMISSION STRUCTURES THAT PROVIDE ELECTRICITY TO MEET INCREASED GLOBAL DEMAND. OUR LIGHTING AND TRAFFIC CONTROL STRUCTURES LINE FREEWAYS AND ROADWAYS IN LOCATIONS AROUND THE WORLD. AND IN THE TELEPHONE AND COMMUNICATION INDUSTRY, WE ARE LEADING THE WAY IN THE DESIGN AND MANUFACTURE OF WIRELESS COMMUNICATION STRUCTURES AND COMPONENTS. 175

PAGE 26 Photo Man and daughter standing in a shop Caption: GENE LOUDEN, OF VALMONT'S IRRIGATION GEAR BOX MANUFACTURING DEPARTMENT, AND HIS DAUGHTER, BRENDA, LIGHTING PRODUCTS MARKETING TRAINEE, WORK FOR VALMONT IN VALLEY, NEBRASKA. 176

PAGE 27 All in the family "We are all in this together." "When my daughter, Brenda, was in her final year of college, she was accepted for a Valmont internship. I couldn't have been happier, because as a long-time Valmont employee--I work on a gear box manufacturing team--I know that Valmont is a good place to work. "Sure, there have been a lot of changes at Valmont over the years. Automation and technological processes have been put in place and safety is even more a focus. But what sets Valmont apart, I think, is that as the company has grown, expanded around the world and the products have become more sophisticated, the management team has done what a lot of companies have not been able to do. They've empowered their employees and instilled the sense that we're all in this together--that our opinions and suggestions are important. "For instance, we have a team-based approach and a Just-in-Time (JIT) program that brings employees together from different disciplines to address issues and solve problems. There is also an emphasis on aptitude evaluations to ensure that the right employees are in the right positions since there are so many career paths available. Training sessions are offered for every shift--even the graveyard shift, which is the one I work on. And for employees who want to pursue higher education, Valmont provides college tuition assistance. My daughter, for instance--now a full-time Valmont employee--is working on her master's degree. Classes are held right here at the Valley location. "I think all of this has contributed to the company's ability to streamline processes and increase productivity. But more importantly, it has led to an increase in employee pride and morale. At Valmont, every person matters--just like a family. And that's the kind of place I want my daughter to work." 177

PAGE 28 FINANCIAL OBJECTIVES AND RESULTS OBJECTIVE Increase trendline earnings 15% per year Graph NET EARNINGS - ------------ 1994 $18.9 1995 $24.8 1996 *$31.3 1997 $37.5 1998 $27.6 15% trendline $ in millions *Before asset valuation charge OBJECTIVE Achieve a minimum 10% after tax Return on Invested Capital Graph RETURN ON INVESTED CAPITAL - -------------------------- 1994 10.7% 1995 13.0% 1996 *14.7% 1997 15.4% 1998 10.3% OBJECTIVE Maintain Long-Term Debt as a percent of Invested Capital at less than 40% Graph LONG TERM DEBT AS A PERCENT OF INVESTED CAPITAL - ----------------------------------------------- 1994 21.9% 1995 17.1% 1996 12.1% 1997 10.4% 1998 30.3% WE MEASURE OUR PERFORMANCE AGAINST MANY STANDARDS. FINANCIALLY, WE HAVE SELECTED THREE PRINCIPAL FACTORS THAT TELL JUST HOW WELL WE ARE MANAGING THE COMPANY AND THE MONEY INVESTED IN IT. THE GOALS WE HAVE ESTABLISHED FOR EARNINGS GROWTH, RETURN ON INVESTED CAPITAL AND LONG TERM DEBT LEVERAGE ARE APPROPRIATE FOR THE INDUSTRIES IN WHICH WE PARTICIPATE, YET CHALLENGING ENOUGH TO DEMAND THE VERY BEST TALENTS AND PERFORMANCE OF OUR MANAGEMENT TEAM. 178

PAGE 29 MANAGEMENT'S DISCUSSION and analysis of Financial Condition and Results of Operations The following discussion and analysis provides information that management believes is relevant to an assessment and understanding of the Company's consolidated results of operations and financial position. This discussion should be read in conjunction with the Consolidated Financial Statements and related Notes. RESULTS OF OPERATIONS The net sales and operating income of the Company's business segments for the past three years are as follows: YEAR ENDED [IN MILLIONS] 1998 1997 1996 --------------------------------------- NET SALES Irrigation $221.1 $239.2 $210.7 Infrastructure 296.0 307.6 270.9 Other 89.2 75.7 162.9 ----------------------------------------- Net Sales $606.3 $622.5 $644.5 ----------------------------------------- OPERATING INCOME Irrigation $25.7 $29.1 $23.9 Infrastructure 8.8 24.6 19.9 Other 13.3 8.3 (7.2) ----------------------------------------- OPERATING INCOME 47.8 62.0 36.6 Other deductions (4.3) (3.1) (3.6) ----------------------------------------- Earnings before income taxes $43.5 $58.9 $33.0 ----------------------------------------- FISCAL 1998 COMPARED WITH FISCAL 1997 CONSOLIDATED Net sales of $606.3 million in 1998 were 2.6% lower than 1997 net sales of $622.5 million. Sales volume declined in both the Infrastructure and Irrigation segments. Sales in the Irrigation segment declined 7.6% from $239.2 million in 1997 to $221.1 million in 1998. In the Infrastructure segment, 1998 sales were $296.0 million, down 3.8% from 1997 sales of $307.6 million. Other sales increased 17.8% from $75.7 million to $89.2 million in 1998, primarily from the acquisitions of four coatings operations in 1998. Graph Segment sales - ------------- 1996 $645 Infrastructure $271 Irrigation $211 Other $163 1997 $623 Infrastructure $308 Irrigation $239 Other $76 1998 $606 Infrastructure $296 Irrigation $221 Other $89 $ in millions GROSS PROFIT AS A PERCENT OF NET SALES 1996 26.7% 1997 27.2% 1998 25.2% The gross profit margin was 25.2% in 1998, compared with 27.2% in 1997. The reduction in 1998 was primarily attributable to lower margins in the Infrastructure segment offset in part by improved margins in the Irrigation segment. Selling, general and administrative expenses declined from $107.2 million (17.2% of sales) in 1997 to $105.1 million (17.3% of sales) in 1998, as a result of cost reduction programs, less sales volume and lower incentive payments. Operating income (pretax earnings before interest and miscellaneous income) decreased 23.0%. Net interest expense was $4.8 million in 1998, compared with $2.8 million in 1997. The higher interest expense is attributable to higher average borrowings. The effective tax rate was 36.5% in 1998, compared with 36.3% in 1997. The higher tax rate in 1998 results primarily from decreased foreign tax benefits. 179

PAGE 30 Net earnings decreased 26.4% to $27.6 million and diluted earnings per share decreased 23.3% to $1.02. The lower percentage decrease in earnings per share compared to net earnings was primarily attributable to the Company's repurchase of shares during 1998. IRRIGATION SEGMENT Net sales and operating income in the Irrigation segment decreased in 1998 by 7.6% and 11.6%, respectively. Agricultural commodity prices declined in the second half of 1998 due to large supplies of grain, which were a result of a favorable growing season and declining demand, particularly from Asia. In recent years, Asian economies have become a larger force in affecting the world's grain supply and demand balance. The disruption in their economies beginning in the summer of 1997 caused a decline in exports of U.S. grain and a decline in prices in 1998. Consequently, farmers became very conservative in their spending for equipment and postponed their investments in machinery. To encourage sales, industry-wide pricing became more competitive. These were the primary contributors to Valmont's reduced sales and operating income for irrigation equipment for the year. Graph WORKING CAPITAL - --------------- 1996 $81.4 1997 $94.4 1998 $99.5 $ in millions SG&A EXPENSE AS A PERCENT OF NET SALES 1996 18.6% 1997 17.2% 1998 17.3% INFRASTRUCTURE SEGMENT Net sales in the Infrastructure segment decreased 3.8% while operating income decreased 64.5%. With respect to the Company's lighting and traffic pole products, wet weather delayed the start of the construction season in many parts of the United States. Also, a delay in the passage of the federal highway bill kept many product purchasers sidelined and thereby reduced sales. As a result, the shipments of lighting and traffic products were lower than the 1997 levels. The eventual passage of the highway bill in June 1998 resulted in an increase of orders for lighting and traffic products throughout the second half of the year. To fill this demand, the Company incurred increased overtime costs. While cost reductions and a reorganization in the North American Pole business lowered the Company's overall cost structure, these actions were not sufficient to overcome the lower prices and reduced gross profit margins on orders taken in the first half of the year but manufactured and shipped in the second half. In Europe, sales of lighting products were above 1997 levels due to the improvement of certain European economies. Lighting sales from the Shanghai, China facility were higher in 1998 as compared to 1997. Orders from electric utility companies in 1998 were above 1997 levels for transmission structures, substations, and distribution poles. This was due to an overall strengthening in demand from utility companies seeking to increase service reliability and expand capacity. Additionally, Valmont has entered into strategic alliances with select electric utility customers to provide cost savings and custom engineering, which have contributed to increased sales. Utility product sales also benefited from increased sales of steel transmission and distribution poles to utility customers who replaced wood poles with steel. Sales of communication poles, towers, and components to the wireless communication market declined in 1998. An overall slowdown, in the build-out of the U.S. wireless communication network, continued throughout 1998. This led to a very competitive market environment that reduced sales and pressured pricing levels. Sales of communication poles and towers in Europe also declined. Sales of communication poles in China increased in 1998. However, the effects of currency devaluation and economic uncertainty led to a reduced level of sales of communication products in the rest of Southeast Asia. 180

PAGE 31 FISCAL 1997 COMPARED WITH FISCAL 1996 CONSOLIDATED Net sales of $622.5 million were 3.4% lower in 1997 than 1996 net sales of $644.5 million. The divestiture in 1997 of Valmont Electric, Inc., a ballast business, was primarily responsible for the sales decline. The gross profit margin was 27.2% in 1997, compared with 26.7% in 1996. The increase in 1997 was primarily attributable to the sale of the ballast business. Operating income (pretax earnings before interest and miscellaneous income) increased 69.2%. As a percent of sales, Selling, general and administrative (SG & A) expenses were 17.2% in 1997 compared to 18.6% in 1996. SG & A expenses in 1997 were $107.2 million compared to $119.6 million in 1996. The decrease in SG & A expenses as a percent of sales resulted from the sale of the ballast business in early 1997, and from leverage of SG & A expenses in other parts of the Company. Net interest expense was $2.8 million in 1997, compared with $3.6 million in 1996. The lower interest expense was attributable to lower debt levels. The effective tax rate was 36.3% in 1997, compared with 35.7% in 1996. Increased income tax rates were primarily the result of tax rates in some foreign jurisdictions being higher than the U.S. Net income increased 76.7% to $37.5 million and diluted earnings per share increased 75.0% to $1.33. The lower percentage decrease in earnings per share compared to net income was primarily attributable to increased outstanding shares. IRRIGATION SEGMENT Irrigation segment sales and operating income increased in 1997 by 13.5% and 21.6%, respectively, due to volume increases both domestically and internationally. These volume increases resulted domestically from a strong farm income and internationally from a new facility in Brazil that led to increased sales in Latin America. INFRASTRUCTURE SEGMENT During 1997, the Infrastructure segment net sales and operating income increased by 13.5% and 23.3%, respectively. Domestically, infrastructure modernization and continued road and highway construction and improvement accounted for the sales increase. Internationally, sales were up in local currencies due to a strong light pole demand and sales of new products; however, these sales decreased when translated into U.S. dollars. LIQUIDITY AND CAPITAL RESOURCES Net working capital at December 26, 1998 was $99.5 million compared to $94.4 million at December 27, 1997. The ratio of current assets to current liabilities was 1.8:1 at both year ends. Available short-term credit facilities through bank lines of credit were $44 million at the end of 1998 compared to $47 million at the end of 1997. On December 26, 1998, $24 million of these credit facilities were unused. The Company's growth has been financed through a combination of cash provided by debt financing and from operations. The Company's objective is to maintain long-term debt as a percent of invested capital below 40%. At the end of 1998, long-term debt as a percent of invested capital was 30.3% as compared to 10.4% at the end of 1997. The increased debt level is the result of the share repurchase program, capital expenditures and acquisitions. Cash provided from operating activities was $42.0 million in 1998 and $23.3 million in 1997. In October of 1997, the Company entered into a Revolving Credit Agreement with a group of banks. Under the terms of the agreement, the Company may borrow up to the equivalent of $100 million in multiple currencies. This facility is unsecured and any outstanding principal balance is due on June 30, 2002. The outstanding principal balance may be paid down at any time without penalty or additional funds may be borrowed up to the maximum limit. On December 26, 1998, the outstanding principal balance was $79 million compared to a balance of $5 million at December 27, 1997. In 1998, the Board of Directors authorized the repurchase of up to 5.4 million shares of the Company's common stock. Repurchased shares are recorded as "Treasury Stock" and result in a reduction of "Shareholders' Equity." When treasury shares are reissued, the Company uses the last-in, first-out method, and the difference between the repurchase cost and reissuance price is charged or credited to "Additional Paid-In Capital." As of December 26, 1998, a total of 3,122,160 shares had been purchased for $53,255. The Company believes cash flows from operations, available credit facilities and the capital structure now in place will be adequate for 1999 planned capital expenditures, for dividends, additional share repurchases and other financial commitments, and for the Company to pursue opportunities to expand its markets and businesses. 181

PAGE 32 CAPITAL EXPENDITURES In 1998, the Company expended $29.7 million in property, plant and equipment, a $9.4 million decrease from the $39.1 million invested in 1997. The major expenditure was a new irrigation manufacturing facility under construction in McCook, Nebraska. Also, included in capital expenditures were increased capacity and replacement of property at Valley, Nebraska, Elkhart, Indiana, Tulsa, Oklahoma and Salem, Oregon. An additional $29.4 million was spent for the acquisition of coating facilities in California, Oklahoma, Oregon and Utah. These acquisitions enabled the Company's Coating Division to reach new markets and customers. Also, included in the acquisitions of 1998, was the purchase of outstanding shares of Cascade Earth Sciences, Ltd., a firm providing consulting services for environmental and wastewater management projects with headquarters in Oregon. RISK MANAGEMENT The Company is subject to market risks associated with changes in foreign currency exchange rates and interest rates. The Company conducts business in many parts of the world. Export sales from the United States are generally denominated in U.S. dollars. In countries where the Company has manufacturing or distribution operations (principally Western Europe, Brazil and China), transactions are generally denominated in the local currency of that country. Where practical, the Company maintains local currency lines of credit and long-term debt to reduce the currency rate risk exposure. The Company's exchange rate exposure totals $40 million and is located in Western Europe ($30 million), Brazil ($8 million) and China ($2 million). The Company is subject to market risk from exposure to changes in interest rates based on its financing, investing and cash management activities. This risk is managed using a mix of fixed and variable rate debt to maintain the desired level of interest rate risk exposure and to minimize net interest expense. At December 26, 1998, the Company had debt outstanding of approximately $122 million, of which 85% was subject to variable interest rates. YEAR 2000 The Company has been addressing the Year 2000 situation for over two years. The Company's plan has included remediation of its mainframe systems, upgrades to packaged systems, implementation of new Enterprise Resource Planning (ERP) systems in certain business units, examination and resolution of administrative and shop equipment that contain embedded chips, evaluation of the Year 2000 readiness of key suppliers and evaluation and resolution of network equipment and personal computers. The Company anticipates completion of its Year 2000 planning during the second quarter of 1999 in the U.S. and in the fourth quarter of 1999 in Europe. The Company has contacted most key domestic suppliers relative to their Year 2000 readiness and has received positive responses. The Company is in the process of contacting key international suppliers and anticipates completion of this phase in the first quarter of 1999. Completion of supplier evaluation is expected by the end of the second quarter of 1999. The process to identify, evaluate and resolve machines and equipment with embedded chips has been under way for nine months. The process is essentially complete for the Company's main plant located in Valley, Nebraska and will be completed at all other locations by the end of the second quarter of 1999. Since much of the network and personal computer equipment is relatively new and frequently upgraded, the majority will be inventoried and tested by the end of the first quarter of 1999. The total cost of the Company's Year 2000 Project is expected to be less than $10 million. Approximately $6 million has been spent to date, and the remaining estimated costs of $4 million are expected to be spent by the end of 1999. Included in these amounts is the cost of installing new ERP systems, which was undertaken to improve business and processes and also address Year 2000 issues. The Company believes its primary Year 2000 risk is that suppliers will not be able to deliver products and/or services in a timely fashion. The Company is currently developing contingency plans to identify alternative vendors and is considering the stockpiling of critical inventory items. Availability of electrical power and telecommunications is required for the Company to operate effectively. These services for the most part are beyond the Company's control and alternate sources are not readily available. Since the Company is currently testing its major business systems or installing new systems, the Company believes such systems will be Year 2000 compliant; however, the Company is discussing contingency plans to cover key business functions for a short period of time. These contingency plans are expected to be developed by the end of the second quarter of 1999. 182

PAGE 33 OUTLOOK FOR 1999 The Company anticipates that spending by farmers on irrigation equipment in the U.S. will remain low in 1999. However, the Company expects a positive year for lighting and traffic products as well as utility products. This projection is based on strong order flows and backlogs in these businesses in late 1998 which has carried into 1999. The current business outlook for wireless communication, is that sales levels will be below those of 1998. As a result of anticipated continued softness in the communication products and irrigation equipment businesses, the Company's overall current outlook is for earnings in 1999 to be similar to those of 1998. Over the long-term, the Company remains positive on the outlook for its businesses. Every year, the world's population grows and with this growth comes an increased need for food. In order to keep up with the escalating demand for food and the desire for improved diets, the agricultural industry must become more efficient. Mechanized irrigation equipment, such as that produced by Valmont, is one of the most cost-effective ways for farmers to improve efficiency. Population growth and economic expansion also create demands on basic infrastructure. Valmont manufactures poles for street lighting and traffic signals and signs, which help relieve congestion, improve highway safety and enhance parking lot safety. The Company also produces structures for the electric utility industry. These products support the transmission and distribution of added electrical capacity. Valmont's poles, towers and components also support wireless communication antennas. Wireless communication is a technology that has already rapidly transformed worldwide communication and further expansion of wireless networks is anticipated. Part of the Company's business plan is to be positioned to respond to trends in these industries with the manufacture of competitively priced products targeted to those industries. The goal of the 1999 business plan is to position the Company for long-term profitable growth and enhanced shareholder value. MANAGEMENT'S DISCUSSION AND ANALYSIS CONTAINS FORWARD LOOKING STATEMENTS WHICH REFLECT MANAGEMENT'S CURRENT VIEW AND ESTIMATES OF FUTURE ECONOMIC AND MARKET CIRCUMSTANCES, INDUSTRY CONDITIONS, COMPANY PERFORMANCE AND FINANCIAL RESULTS. THE STATEMENTS ARE BASED ON MANY ASSUMPTIONS AND FACTORS INCLUDING OPERATING EFFICIENCIES, AVAILABILITY AND PRICE OF RAW MATERIALS, AVAILABILITY AND MARKET ACCEPTANCE OF NEW PRODUCTS, PRODUCT PRICING, DOMESTIC AND INTERNATIONAL COMPETITIVE ENVIRONMENTS, ACTIONS AND POLICY CHANGES OF DOMESTIC AND INTERNATIONAL GOVERNMENTS, AND OTHER RISKS DESCRIBED FROM TIME TO TIME IN VALMONT'S REPORTS TO THE SECURITIES AND EXCHANGE COMMISSION. ANY CHANGES IN SUCH ASSUMPTIONS OR FACTORS COULD PRODUCE SIGNIFICANTLY DIFFERENT RESULTS. Graph TOTAL ASSETS - ------------ 1996 $342 1997 $368 1998 $407 $ in millions CAPITAL EXPENDITURES 1996 $35.6 1997 $39.1 1998 $29.7 $ in millions 183

PAGE 34 SELECTED 11-YEAR FINANCIAL DATA [DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS] 1998 1997 1996 1995 OPERATING DATA - ----------------------------------------------------------------------------------------------------------------- Net sales $606,307 $622,506 $644,531 544,642 Earnings (loss) from continuing operations 27,636 37,544 21,248 24,759 Earnings from discontinued operations -- -- -- -- Cumulative effect of accounting change -- -- -- -- - ----------------------------------------------------------------------------------------------------------------- Net earnings (loss) $ 27,636 $ 37,544 $ 21,248 $ 24,759 - ----------------------------------------------------------------------------------------------------------------- Depreciation and amortization $ 19,843 $ 16,437 $ 14,832 $ 12,361 Capital expenditures 29,667 39,115 35,559 34,772 Per share data Earnings (loss): Basic $ 1.04 $ 1.36 $ 0.78 $ 0.92 Diluted 1.02 1.33 0.76 0.90 Cash dividends 0.25 0.22 0.19 0.15 Shareholders' equity 7.12 7.49 6.41 5.87 FINANCIAL POSITION Working capital $ 99,466 $ 94,416 $ 81,403 $ 80,993 Property, plant and equipment, net 157,447 140,834 120,579 113,532 Total assets 406,957 368,052 341,648 308,710 Long-term debt, including current installments 96,218 28,060 29,573 36,687 Shareholders' equity 175,913 207,102 175,231 159,256 Invested capital 317,708 270,400 243,905 215,318 KEY FINANCIAL MEASURES Return on beginning shareholders' equity 13.3% 21.4% 13.3% 18.0% Return on invested capital 10.3% 15.4% 10.3% 13.0% Long-term debt as a percent of invested capital 30.3% 10.4% 12.1% 17.0% YEAR-END DATA Shares outstanding (000) 24,721 27,641 27,330 27,120 Approximate number of shareholders 5,500 5,400 4,400 3,900 Number of employees 3,869 3,751 4,868 4,166 Per share amounts and number of shares reflect the two-for-one stock splits in 1988, 1989 and 1997. All amounts include pooling-of-interests method of accounting for the acquisition of Microflect in July, 1995. 184

PAGE 35 1994 1993 1992 1991 1990 1989 1988 -------- --------- --------- --------- --------- --------- --------- $501,740 $464,274 $445,481 $446,543 $461,789 $443,444 $439,569 18,887 7,551 11,671 (8,822) 11,373 16,818 12,301 -- 4,637 3,564 2,134 5,474 4,602 3,639 -- (4,910) -- -- -- -- -- - -------------------------------------------------------------------------------------------------------------------------------- $ 18,887 $ 7,278 $ 15,235 $ (6,688) $ 16,847 $ 21,420 $ 15,940 - -------------------------------------------------------------------------------------------------------------------------------- $ 11,018 $ 10,907 $ 12,585 $ 11,285 $ 9,887 $ 7,608 $ 7,788 23,535 17,089 8,353 11,539 20,607 17,470 9,750 $ 0.70 $ 0.27 $ 0.57 $ (0.25) $ 0.63 $ 0.81 $ 0.62 0.69 0.27 0.56 (0.25) 0.63 0.81 0.62 0.15 0.15 0.13 0.13 0.13 0.11 0.09 5.10 4.52 4.43 4.06 4.42 3.94 3.26 $ 88,278 $ 87,793 $ 68,551 $ 69,143 $ 66,302 $ 72,811 $ 58,786 89,201 75,501 78,150 84,144 81,675 71,872 53,135 283,443 261,275 286,076 291.041 291,163 268,216 225,461 43,242 44,076 69,735 81,698 63,003 66,774 47,337 137,582 121,841 118,428 108,142 117,200 104,069 84,163 197,591 180,961 200,501 205,618 191,255 180,464 138,392 15.5% 6.1% 14.1% (5.7%) 16.2% 25.5% 23.2% 10.7% 5.6% 7.4% (1.9%) 9.5% 12.4% 11.6% 21.9% 24.4% 34.8% 39.7% 32.9% 37.0% 34.2% 26,990 26,972 26,750 26,620 26,494 26,412 25,828 3,800 3,800 3,500 3,500 2,800 1,600 1,500 3,946 4,152 4,532 4,478 4,524 4,255 3,569 185

PAGE 36 Consolidated Statements of Operations THREE-YEAR PERIOD ENDED DECEMBER 26, 1998 [DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS] 1998 1997 1996 - -------------------------------------------------------------------------------------------------------------------------------- Net sales $606,307 $622,506 $644,531 Cost of sales 453,459 453,326 472,463 ----------------------------------------------- Gross profit 152,848 169,180 172,068 Selling, general and administrative expenses 105,096 107,190 119,624 Asset valuation charge -- -- 15,800 ----------------------------------------------- Operating income 47,752 61,990 36,644 ----------------------------------------------- Other income (deductions): Interest expense (5,858) (3,731) (3,952) Interest income 1,012 900 344 Miscellaneous 630 (215) 12 ----------------------------------------------- (4,216) (3,046) (3,596) ----------------------------------------------- Earnings before income taxes 43,536 58,944 33,048 ----------------------------------------------- Income tax expense (benefit): Current 12,500 14,400 19,970 Deferred 3,400 7,000 (8,170) ----------------------------------------------- 15,900 21,400 11,800 ----------------------------------------------- Net earnings $ 27,636 $ 37,544 $ 21,248 ----------------------------------------------- ----------------------------------------------- Earnings per share: Basic $ 1.04 $ 1.36 $ 0.78 ----------------------------------------------- ----------------------------------------------- Diluted $ 1.02 $ 1.33 $ 0.76 ----------------------------------------------- ----------------------------------------------- Cash dividends per share $0.25125 $0.21875 $ 0.1875 ----------------------------------------------- ----------------------------------------------- See accompanying notes to consolidated financial statements. 186

PAGE 37 CONSOLIDATED BALANCE SHEETS DECEMBER 26, 1998 AND DECEMBER 27, 1997 [DOLLARS IN THOUSANDS, EXCEPT SHARE AMOUNTS] 1998 1997 - -------------------------------------------------------------------------------------------------------------------------------- ASSETS Current assets: Cash and cash equivalents $ 7,580 $ 11,505 Receivables, less allowance for doubtful receivables of $3,421 in 1998 and $2,132 in 1997 115,843 110,531 Inventories 77,694 79,444 Prepaid expenses 5,297 3,388 Refundable and deferred income taxes 13,532 13,062 ----------------------------- 219,946 217,930 Property, plant and equipment, at cost 292,944 258,478 Less accumulated depreciation and amortization 135,497 117,644 ----------------------------- Net property, plant and equipment 157,447 140,834 ----------------------------- Goodwill and other assets 29,564 9,288 ----------------------------- Total assets $406,957 $368,052 ----------------------------- ----------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Current installments of long-term debt $ 5,737 $ 7,317 Notes payable to banks 25,494 18,545 Accounts payable 45,996 48,717 Accrued expenses 41,646 47,380 Dividends payable 1,607 1,555 ----------------------------- Total current liabilities 120,480 123,514 ----------------------------- Deferred income taxes 11,984 9,038 Long-term debt, excluding current installments 90,481 20,743 Minority interest in consolidated subsidiaries 3,862 3,957 Other noncurrent liabilities 4,237 3,698 Shareholders' equity: Preferred stock of $1 par value. Authorized 500,000 shares; none issued -- -- Common stock of $1 par value. Authorized 75,000,000 shares; issued 27,900,000 shares 27,900 27,900 Additional paid-in capital 1,280 838 Retained earnings 200,393 179,360 Accumulated other comprehensive income (1,423) (966) ----------------------------- 228,150 207,132 Less: Cost of common shares in treasury 3,178,627 shares in 1998 (259,031 shares in 1997) 52,235 8 Unearned restricted stock 2 22 ----------------------------- Total shareholders' equity 175,913 207,102 ----------------------------- Total liabilities and shareholders' equity $406,957 $368,052 ----------------------------- ----------------------------- See accompanying notes to consolidated financial statements. 187

PAGE 38 CONSOLIDATED STATEMENTS OF CASH FLOWS THREE-YEAR PERIOD ENDED DECEMBER 26, 1998 [DOLLARS IN THOUSANDS] 1998 1997 1996 - -------------------------------------------------------------------------------------------------------------------------------- CASH FLOWS FROM OPERATIONS: Net earnings $27,636 $37,544 $21,248 Adjustments to reconcile net earnings to net cash provided by operations: Depreciation and amortization 19,843 16,437 14,832 Other adjustments (302) 1,385 580 Changes in assets and liabilities: Receivables 1,379 (32,040) (16,484) Inventories 4,057 (7,671) (16,270) Prepaid expenses (1,704) (1,081) (1,217) Accounts payable (4,645) 7,154 10,120 Accrued expenses (7,986) (4,297) 15,022 Other noncurrent liabilities 253 769 (394) Income taxes 3,517 5,147 (7,594) --------------------------------------------- Net cash provided by operations 42,048 23,347 19,843 --------------------------------------------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property, plant and equipment (29,667) (39,115) (35,559) Acquisitions (29,447) -- (1,255) Proceeds from sale of property and equipment 4,768 289 858 Proceeds from sale of assets held for sale -- 26,903 -- Proceeds from investments by minority shareholder -- 1,959 97 Changes in other assets (1,875) 924 (1,246) Other, net (581) (1,007) (260) --------------------------------------------- Net cash used in investing activities (56,802) (10,047) (37,365) ------------------------------------------- CASH FLOWS FROM FINANCING ACTIVITIES: Net borrowings (repayments) under short-term agreements 6,612 (4,550) 20,630 Proceeds from long-term borrowings 73,443 7,172 1,942 Principal payments on long-term obligations (9,742) (7,856) (8,142) Dividends paid (6,551) (5,838) (4,762) Proceeds from exercises under stock plans 3,347 3,067 2,073 Purchase of common treasury shares: Stock repurchase program (53,255) -- -- Stock plan exercises (3,025) (3,273) (1,732) --------------------------------------------- Net cash provided (used) by financing activities 10,829 (11,278) 10,009 --------------------------------------------- Net increase (decrease) in cash and cash equivalents (3,925) 2,022 (7,513) Cash and cash equivalents--beginning of year 11,505 9,483 16,996 --------------------------------------------- Cash and cash equivalents--end of year $ 7,580 $11,505 $ 9,483 --------------------------------------------- --------------------------------------------- See accompanying notes to consolidated financial statements. 188

PAGE 39 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY THREE-YEAR PERIOD ENDED DECEMBER 26, 1998 Common Additional Retained Accumulated Treasury Unearned Total stock paid-in earnings other stock restricted shareholders' [DOLLARS IN THOUSANDS, capital comprehensive stock equity EXCEPT PER SHARE AMOUNTS] income - ------------------------------------------------------------------------------------------------------------------------------- BALANCE AT DECEMBER 30, 1995 $13,950 $4,694 $137,009 $3,689 $(24) $(62) $159,256 Comprehensive income: Net earnings -- -- 21,248 -- -- -- 21,248 Currency translation adjustment -- -- -- (1,952) -- -- (1,952) ------- Total comprehensive income 19,296 Cash dividends ($0.1875 per share) -- -- (5,111) -- -- -- (5,111) Purchase of 97,444 common shares - stock plan exercises -- -- -- -- (1,732) -- (1,732) Stock options exercised; 174,810 shares issued -- 335 -- -- 1,738 -- 2,073 Tax benefit from exercise of stock options -- 1,023 -- -- -- -- 1,023 Stock awards; 27,824 shares issued -- 406 -- -- -- 20 426 ----------------------------------------------------------------------------------------- BALANCE AT DECEMBER 28, 1996 13,950 6,458 153,146 1,737 (18) (42) 175,231 Comprehensive income: Net earnings -- -- 37,544 -- -- -- 37,544 Currency translation adjustment -- -- -- (2,703) -- -- (2,703) ------- Total comprehensive income 34,841 Cash dividends ($0.21875 per share) -- -- (6,027) -- -- -- (6,027) Purchase of 154,039 common shares - stock plan exercises -- -- -- -- (3,273) -- (3,273) Sale of 43, 914 common shares -- 905 -- -- -- -- 905 Stock options exercised; 393,164 shares issued -- (216) -- -- 3,283 -- 3,067 Tax benefit from exercise of stock options -- 1,796 -- -- -- -- 1,796 Stock awards; 27,146 shares issued -- 542 -- -- -- 20 562 Two-for-one stock split 13,950 (8,647) (5,303) -- -- -- -- ----------------------------------------------------------------------------------------- BALANCE AT DECEMBER 27, 1997 27,900 838 179,360 (966) (8) (22) 207,102 Comprehensive income: Net earnings -- -- 27,636 -- -- -- 27,636 Currency translation adjustment -- -- -- (457) -- -- (457) ----- Total comprehensive income 27,179 Cash dividends ($0.25125 per share) -- -- (6,603) -- -- -- (6,603) Purchase of treasury shares: Stock repurchase program 3,122,160 shares -- -- -- -- (53,255) -- (53,255) Stock plan exercises, 163,590 shares -- -- -- -- (3,025) -- (3,025) Stock options exercised; 339,241 shares issued -- (1,331) -- -- 4,052 -- 2,721 Tax benefit from exercise of stock options -- 1,169 -- -- -- -- 1,169 Stock awards; 26,913 shares issued -- 604 -- -- 1 20 625 ----------------------------------------------------------------------------------------- BALANCE AT DECEMBER 26, 1998 $27,900 $1,280 $200,393 $(1,423) $(52,235) $ (2) $175,913 ----------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------- See accompanying notes to consolidated financial statements. 189

PAGE 40 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS THREE-YEAR PERIOD ENDED DECEMBER 26, 1998 (DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES PRINCIPLES OF CONSOLIDATION The consolidated financial statements include the accounts of Valmont Industries, Inc. (the Company) and its wholly and majority-owned subsidiaries. Investments in 20% to 50% owned affiliates are accounted for on the equity method and investments in less than 20% owned affiliates are accounted for on the cost method. All significant intercompany items have been eliminated. OPERATIONS The Company designs, manufactures and distributes agricultural irrigation equipment and related products and services, engineered metal structures and related products for the lighting, utility and wireless communications industries, and industrial products including steel tubing, pressure vessels, machine tool accessories, industrial fasteners; and provides custom coating services. FISCAL YEAR The Company operates on 52/53 week fiscal years with each year ending on the last Saturday in December. Accordingly, the Company's fiscal years 1998, 1997 and 1996 ended on December 26, December 27 and December 28, respectively, and each of these fiscal years consisted of 52 weeks. INVENTORIES At December 26, 1998, approximately 65% of inventory is valued at the lower of cost, determined on the last-in, first-out (LIFO) method or market. All other inventory is valued at the lower of cost, determined on the first-in, first-out (FIFO) method or market. The excess of replacement cost of inventories over the LIFO value is approximately $10,000 and $11,000 at December 26, 1998 and December 27, 1997, respectively. LONG-LIVED ASSETS The Company follows Statement of Financial Accounting Standards No. 121, (SFAS No. 121), "Accounting for the Impairment of Long-lived Assets and for Long-lived Assets to Be Disposed Of," which prescribes that an impairment loss be recognized if the carrying amount of an asset may not be recoverable and exceeds estimated future undiscounted cash flows of the asset. A recognized impairment loss reduces the carrying amount of the asset to its fair value. (Note 14). Property, plant and equipment are recorded at historical cost. The Company uses the straight-line method in computing depreciation and amortization for financial reporting purposes and generally uses accelerated methods for income tax purposes. The annual provisions for depreciation and amortization have been computed principally in accordance with the following ranges of asset lives: buildings 15 to 40 years, machinery and equipment 3 to 12 years, and intangibles 3 to 40 years. INCOME TAXES The Company uses the asset and liability method to calculate deferred income taxes. Deferred tax assets and liabilities are recognized on temporary differences between financial statement and tax basis of assets and liabilities using enacted tax rates. The effect of tax rate changes on deferred tax assets and liabilities is recognized in income during the period that includes the enactment date. FOREIGN CURRENCY TRANSLATIONS Results of operations for foreign subsidiaries are translated using the average exchange rates during the period. Assets and liabilities are translated at the exchange rates in effect on the balance sheet dates. Cumulative translation adjustments are included as a separate component of accumulated other comprehensive income as shown on the Consolidated Statements of Shareholders' Equity. These translation adjustments are the Company's only component of other comprehensive income. USE OF ESTIMATES Management of the Company has made a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these financial statements in conformity with generally accepted accounting principles. Actual results could differ from those estimates. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS In June 1998, the Financial Accounting Standards Board ("FASB") issued SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities," which is effective for fiscal years beginning after June 15, 1999. SFAS No. 133 establishes accounting and reporting standards for derivative instruments and hedging activities. It requires that an entity recognize all derivatives as either assets or liabilities in the statement of financial position and measure those instruments at fair value. The Company plans initial application of this statement for the quarter beginning December 26, 1999. The Statement will not be applied retroactively to financial statements of prior periods. 190

PAGE 41 RECLASSIFICATIONS Certain amounts in the 1997 and 1996 financial statements have been reclassified to conform with the 1998 presentation. (2) CASH FLOW SUPPLEMENTARY INFORMATION The Company considers all highly liquid temporary cash investments purchased with a maturity of three months or less to be cash equivalents. Cash payments for interest and income taxes (net of refunds) were as follows: 1998 1997 1996 ------------------------------------------- Interest $ 5,747 $ 4,035 $ 3,824 Income taxes 11,223 16,373 17,904 (3) PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment, at cost, consists of the following: 1998 1997 ---------------------------- Land and improvements $ 12,696 $ 12,661 Buildings and improvements 69,690 65,495 Machinery and equipment 152,229 131,939 Transportation equipment 5,131 4,343 Office furniture and equipment 25,786 23,387 Construction in progress 27,412 20,653 ---------------------------- $292,944 $258,478 ---------------------------- ---------------------------- The Company also leases certain facilities, machinery, computer equipment and transportation equipment under operating leases with unexpired terms ranging from one to twelve years. Rental expense for operating leases amounted to $5,807, $4,920 and $4,963 for fiscal 1998, 1997 and 1996, respectively. Minimum lease payments under operating leases expiring subsequent to December 26, 1998 are: Fiscal year ending 1999 $ 6,224 2000 5,571 2001 5,245 2002 3,934 2003 3,779 Subsequent 8,133 ------- Total minimum lease payments $32,886 ------- ------- (4) BANK CREDIT ARRANGEMENTS The Company maintains various lines of credit for short-term borrowings totaling $44,000. The interest rates charged on these lines of credit vary in relation to the banks' costs of funds. The unused borrowings under the lines of credit were $24,000 at December 26, 1998. The lines of credit can be modified at any time at the option of the banks. The Company pays facility fees of 1/8 of 1% in connection with $10,000 of its lines of credit, and pays no fees in connection with the remaining lines of credit. The weighted average interest rate on short-term borrowings was 5.3% at December 26, 1998 and 5.7% at December 27, 1997. (5) INCOME TAXES Income tax expense (benefit) consists of: 1998 1997 1996 -------------------------------------------- Current: Federal $ 9,501 $11,423 $16,914 State 912 940 1,086 Foreign 2,087 2,037 1,970 -------------------------------------------- 12,500 14,400 19,970 -------------------------------------------- Deferred: Federal 2,224 5,963 (7,006) State 176 529 (392) Foreign 1,000 508 (772) -------------------------------------------- 3,400 7,000 (8,170) -------------------------------------------- $15,900 $21,400 $11,800 -------------------------------------------- -------------------------------------------- The reconciliations of the statutory Federal income tax rate and the effective tax rates follow: 1998 1997 1996 ------------------------------------------- Statutory Federal income tax rate 35.0% 35.0% 35.0% State income taxes, net of Federal benefit 1.8% 1.9% 2.1% Other (0.3)% (0.6)% (1.4)% ------------------------------------------- 36.5% 36.3% 35.7% ------------------------------------------- ------------------------------------------- The tax effects of temporary differences that give rise to deferred tax assets and liabilities at December 26, 1998 and December 27, 1997, are presented below: 1998 1997 -------------------------- Deferred tax assets: Accrued expenses and allowances $10,688 $11,920 Allowance for doubtful receivables 289 166 Inventory capitalization 1,199 1,273 -------------------------- Total deferred tax assets 12,176 13,359 -------------------------- Deferred tax liabilities: Plant and equipment 11,062 9,578 Lease transactions 1,507 1,586 Warranty accrual 323 442 Other 4,241 2,609 -------------------------- Total deferred tax liabilities 17,133 14,215 -------------------------- Net deferred tax liabilities $(4,957) $(856) -------------------------- -------------------------- No valuation allowance for deferred tax assets has been provided since all tax benefits are more likely than not to be realized. No taxes have been provided on undistributed earnings of foreign subsidiaries as the Company intends to reinvest these earnings in foreign operations. 191

PAGE 42 (6) LONG-TERM DEBT 1998 1997 --------------------------- 9.40% to 12.77% promissory notes, unsecured (a) $10,250 $14,750 Promissory note, secured -- 2,165 Revolving credit agreement (b) 78,833 5,000 3.0% to 9.25% notes 7,135 6,145 --------------------------- Total long-term debt 96,218 28,060 Less current installments of long-term debt 5,737 7,317 --------------------------- Long-term debt, excluding current installments $90,481 $20,743 --------------------------- --------------------------- (A) The unsecured promissory notes payable are due in varying annual principal installments through 2001. The notes are subject to prepayment in whole or in part with or without premium as specified in the agreements. (B) The revolving credit agreement is an unsecured facility with a group of banks for a maximum of $100,000. The facility has a termination date of June 30, 2002. The funds borrowed may be repaid at any time without penalty, or additional funds may be borrowed up to the facility limit. The Company may choose from the following three interest rate alternatives: the higher of prime rate or Federal Funds Rate plus 0.5%, the applicable Eurodollar rate plus a leverage ratio-based spread (which at December 26, 1998 was 0.2%) or up to $50,000 at a rate determined through a competitive bid process. The effective interest rate at December 26, 1998 was 5.36% and at December 27, 1997 was 6.18%. The agreements place certain restrictions on working capital, capital expenditures, payment of dividends, purchase of Company stock and additional borrowings. Under the most restrictive covenants of the Agreements, the Company may purchase the remainder of the 5.4 million shares of Company stock authorized by the Board of Directors in 1998 and make payments of cash dividends and purchases of the Company's capital stock of $12,000 in any fiscal year. The minimum aggregate maturities of long-term debt for each of the four years following 1999 are: $4,330, $2,906, $79,473 and $452. (7) STOCK PLANS The Company maintains stock-based compensation plans approved by the shareholders which provide that the Compensation Committee of the Board of Directors may grant incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock awards and bonuses of common stock. At December 26, 1998, 448,000 shares of common stock remained available for issuance under the plans. The optioned shares are subject to changes in capitalization. Under the plans, the exercise price of each option equals the market price at the time of the grant. Options vest beginning on the first anniversary of the grant in equal amounts over three to six years or on the fifth anniversary of the grant. Expiration of grants is from six to ten years from the date of grant. The Company applies APB Opinion 25 in accounting for its fixed stock compensation plans. Accordingly, no compensation cost has been recognized for the fixed plans in 1996, 1997 or 1998. Had compensation cost been determined on the basis of fair value pursuant to Statement of Financial Accounting Standards No. 123, net earnings and earnings per share would have been reduced as follows: 1998 1997 1996 ---------------------------------------- Net earnings As reported $27,636 $37,544 $21,248 ------------------------------------------ Pro forma $25,969 $36,584 $20,561 ------------------------------------------ Earnings per share As reported: Basic $1.04 $1.36 $0.78 ---------------------------------------- Diluted $1.02 $1.33 $0.76 ---------------------------------------- Pro forma: Basic $0.98 $1.33 $0.75 ---------------------------------------- Diluted $0.96 $1.30 $0.73 ---------------------------------------- The fair value of each option grant was estimated as of the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions used for grants in 1998, 1997 and 1996: 1998 1997 1996 ---------------------------------------- Expected volatility 35% 29% 28% Risk-free interest rate 4.71% 5.75% 6.11% Expected life from vesting date 2.6yrs 2.7yrs 2.5yrs Dividend yield 1.15% 1.03% 1.03% Following is a summary of the activity of the stock plans during 1996, 1997 and 1998: WEIGHTED AVERAGE NUMBER EXERCISE OF SHARES PRICE Outstanding at December 30, 1995 1,790,042 $ 8.61 Granted 414,030 18.64 Exercised (280,000) (7.41) Forfeited (57,098) (5.57) Outstanding at ---------------------------- December 28, 1996 1,866,974 $11.11 ---------------------------- Options exercisable at December 28, 1996 825,306 $ 8.33 ---------------------------- Weighted average fair value of options granted during 1996 $ 6.24 ----- 192

PAGE 43 WEIGHTED AVERAGE NUMBER EXERCISE OF SHARES PRICE ----------- ----------- Outstanding at December 28, 1996 1,866,974 $11.11 Granted 443,414 21.48 Exercised (308,876) (7.43) Forfeited (76,850) (14.34) ---------------------------- Outstanding at December 27, 1997 1,924,662 $13.96 ---------------------------- Options exercisable at December 27, 1997 919,801 $10.22 ---------------------------- Weighted average fair value of options granted during 1997 $6.56 ----- WEIGHTED AVERAGE NUMBER EXERCISE OF SHARES PRICE ----------- ---------- Outstanding at December 27, 1997 1,924,662 $13.96 Granted 712,687 17.09 Exercised (339,241) (8.57) Forfeited (118,012) (19.27) Outstanding at ---------------------------- December 26, 1998 2,180,096 $15.52 ---------------------------- Options exercisable at December 26, 1998 1,034,491 $13.35 ---------------------------- Weighted average fair value of options granted during 1998 $5.58 ----- Following is a summary of the status of stock options outstanding at December 26, 1998: OUTSTANDING AND EXERCISABLE BY PRICE RANGE OPTIONS OUTSTANDING OPTIONS EXERCISABLE --------------------------------------------------------------------------------------------------------- WEIGHTED AVERAGE WEIGHTED WEIGHTED EXERCISE REMAINING AVERAGE AVERAGE PRICE CONTRACTUAL EXERCISE EXERCISE RANGE NUMBER LIFE PRICE NUMBER PRICE --------------------------------------------------------------------------------------------------------- $5.50-11.88 745,943 5.39 years $ 9.78 680,706 $ 9.88 12.25-15.88 578,542 9.43 years 15.78 18,500 15.09 16.00-21.78 765,731 8.14 years 20.11 295,405 19.99 22.13-23.00 89,880 6.90 years 22.51 39,880 22.67 --------------------------------------------------------------------------------------------------------- 2,180,096 1,034,491 --------------------------------------------------------------------------------------------------------- (8) EARNINGS PER SHARE The following table provides a reconciliation between Basic and Diluted earnings per share (EPS). DILUTIVE EFFECT OF STOCK DILUTED BASIC EPS OPTIONS EPS -------------------------------------------------- 1996: Net earnings $21,248 -- $21,248 Shares outstanding 27,308 751 28,059 Per share amount $ 0.78 $ 0.76 1997: Net earnings $37,544 -- $37,544 Shares outstanding 27,521 686 28,207 Per share amount $ 1.36 $ 1.33 1998: Net earnings $27,636 -- $27,636 Shares outstanding 26,605 498 27,103 Per share amount $ 1.04 $ 1.02 (9) TREASURY STOCK During 1998, the Board of Directors authorized management to repurchase up to 5.4 million shares of the Company's common stock. In the year ended December 26, 1998, a total of 3.1 million shares had been repurchased for $53,255. Repurchased shares are recorded as "Treasury Stock" and result in a reduction of "Shareholders' Equity." When treasury shares are reissued, the Company uses the last-in, first-out method, and the difference between the repurchase cost and reissuance price is charged or credited to "Additional Paid-In Capital." (10) EMPLOYEE RETIREMENT SAVINGS PLAN Established under Internal Revenue Code Section 401(k), the Valmont Employee Retirement Savings Plan is available to all eligible employees. Participants can elect to contribute up to 15% of annual pay, on a pretax and/or after-tax basis. The Company may also make basic, matching and/or supplemental contributions to the Plan. In addition, the Company has a defined contribution plan covering the employees of Microflect; contributions under this plan are based primarily on the performance of the business unit and employee compensation. The 1998, 1997 and 1996 Company contributions to these plans amounted to approximately $3,900, $5,400 and $5,000, respectively. (11) RESEARCH AND DEVELOPMENT Research and development costs are charged to operations in the year incurred. Research and development expenses were approximately $3,300 in 1998, $3,700 in 1997, and $3,900 in 1996. 193

PAGE 44 (12) DISCLOSURES ABOUT THE FAIR VALUE OF FINANCIAL INSTRUMENTS The carrying amount of cash and cash equivalents, receivables, accounts payable, notes payable to banks and accrued expenses approximate fair value because of the short maturity of these instruments. The fair values of each of the Company's long-term debt instruments are based on the amount of future cash flows associated with each instrument discounted using the Company's current borrowing rate for similar debt instruments of comparable maturity. The fair value estimates are made at a specific point in time and the underlying assumptions are subject to change based on market conditions. At December 26, 1998, the carrying amount of the Company's long-term debt was $96,218 with an estimated fair value of approximately the same. At December 27, 1997, the carrying amount of the Company's long-term debt was $28,060 with an estimated fair value of approximately $29,000. (13) STOCKHOLDERS' RIGHT PLAN In December 1995, the Company's Board of Directors declared a dividend of one preferred stock purchase right ("Right") for each outstanding share of common stock. The Right becomes exercisable ten days after a person (other than Robert B. Daugherty and his related persons and entities) acquires or commences a tender offer for 15% or more of the Company's common stock. Each Right entitles the holder to purchase one one-thousandth of a share of a new series of preferred stock at an exercise price of $100, subject to adjustment. The Right expires on December 19, 2005 and may be redeemed at the option of the Company at $.01 per Right, subject to adjustment. Under certain circumstances, if (i) any person becomes an Acquiring Person or (ii) the Company is acquired in a merger or other business combination, each holder of a Right (other than the Acquiring Person) will have the right to receive, upon exercise of the Right, shares of common stock (of the Company under (i) and of the acquiring company under (ii)) having a value of twice the exercise price of the Right. (14) ACQUISITIONS AND DIVESTITURE During 1998 the Company acquired the operating assets of four separate galvanizing facilities in California, Oklahoma, Oregon and Utah. The excess of purchase price over the estimated fair values of the net assets acquired has been recorded as goodwill and is amortized over estimated useful lives. In November 1998, the Company acquired the outstanding shares of Cascade Earth Sciences, Ltd., a firm providing consulting services for environmental and wastewater management projects with headquarters in Oregon. During 1996, the Company initiated a plan to dispose of Valmont Electric, Inc., its ballast business. In accordance with SFAS No. 121, the Company recorded a pretax asset valuation charge of $15,800 ($10,100 after tax) in 1996 to reduce the value of the net assets of the ballast business to the sales price, net of expenses. The Company sold the common stock of Valmont Electric, Inc. in January 1997 for approximately $25,000. In February 1996, the Company purchased a majority interest in Telec Centre S.A., a small French manufacturer of communication towers. In March 1996, the Company purchased a majority interest in Gibo-Conimast GmbH, a German manufacturer and distributor of pole structures for the lighting market. These acquisitions have been accounted for under the purchase method. The results of operations of the acquired businesses are included in the consolidated financial statements from the dates of acquisition. (15) BUSINESS SEGMENTS The Company adopted SFAS No. 131, "Disclosures About Segments of an Enterprise and Related Disclosures," in 1998.This accounting pronouncement changes the way the Company reports information about its operating segments and, accordingly, the 1997 and 1996 information has been restated to conform to the 1998 presentation. The Company organizes its businesses on a world-wide product line basis and has two reportable segments: IRRIGATION: This segment consists of the manufacture and distribution of agricultural irrigation equipment and related products and services; INFRASTRUCTURE: This segment includes the manufacture and distribution of engineered metal structures and related products for the lighting, utility and wireless communications industries. In addition to these two reportable segments, the Company has several other businesses that do not fit within the reportable segments listed above, and are not individually more than 10% of combined net sales. These businesses include custom coatings, steel tubing, pressure vessels, machine tool accessories and industrial fasteners. For fiscal years 1997 and 1996, the "Other" category also includes the ballast business that was sold in January 1997. The accounting policies of the reportable segments are the same as those described in Note 1. The Company evaluates the performance of its operating segments based upon operating income and invested capital. The Company does not allocate interest expense, non-operating income and deductions or income taxes to its operating segments. All Corporate expenses and assets are allocated to the operating segments. Intersegment sales include tubing sales to the Irrigation segment and coatings services to the Irrigation and Infrastructure segments. Intersegment sales prices are both cost and market based. 194

PAGE 45 BUSINESS SEGMENT INFORMATION SUMMARY BY BUSINESS SEGMENTS [DOLLARS IN THOUSANDS] 1998 1997 1996 - --------------------------------------------------------------------------------------------------------------------------- NET SALES Irrigation $221,087 $239,157 $210,672 Infrastructure 296,002 307,586 270,897 Other--Total 124,258 110,231 194,726 Less: Intersegment sales 35,040 34,468 31,764 ------------------------------------------------------ Other--Sales to external customers 89,218 75,763 162,962 ------------------------------------------------------ Total $606,307 $622,506 $644,531 ------------------------------------------------------ OPERATING INCOME Irrigation 25,725 29,090 23,918 Infrastructure 9,553 25,274 20,611 Other 12,474 7,626 (7,885) ------------------------------------------------------ Total 47,752 61,990 36,644 INTEREST EXPENSE, NET (4,846) (2,831) (3,608) MISCELLANEOUS 630 (215) 12 ------------------------------------------------------ Earnings before income taxes $ 43,536 $ 58,944 $ 33,048 ------------------------------------------------------ TOTAL ASSETS: Irrigation 107,899 94,294 68,588 Infrastructure 202,140 214,789 188,057 Other 96,918 58,969 85,003 ------------------------------------------------------ Total $406,957 $368,052 $341,648 ------------------------------------------------------ CAPITAL EXPENDITURES: Irrigation 16,484 7,421 4,055 Infrastructure 3,846 22,671 15,300 Other 9,337 9,023 16,204 ------------------------------------------------------ Total $ 29,667 $ 39,115 $ 35,559 ------------------------------------------------------ DEPRECIATION AND AMORTIZATION: Irrigation 3,875 3,245 2,958 Infrastructure 4,943 3,047 1,841 ------------------------------------------------------ Total $19,843 $16,437 $14,832 ------------------------------------------------------ SUMMARY BY GEOGRAPHICAL AREA BY LOCATION OF VALMONT FACILITIES: 1998 1997 1996 ------------------------------------------------------ NET SALES United States 493,413 527,609 557,826 France 59,887 52,226 58,843 Other 53,007 42,671 27,862 ------------------------------------------------------ Total $606,307 $622,506 $644,531 ------------------------------------------------------ OPERATING INCOME United States 42,398 56,594 32,451 France 505 1,976 2,644 Other 4,849 3,420 1,549 ------------------------------------------------------ Total $ 47,752 $ 61,990 $ 36,644 ------------------------------------------------------ LONG-LIVED ASSETS United States 153,712 116,265 95,922 France 17,729 18,597 20,769 Other 15,570 15,260 14,110 ------------------------------------------------------ Total $187,011 $150,122 $130,801 ------------------------------------------------------ NO SINGLE CUSTOMER ACCOUNTED FOR MORE THAN 10% OF NET SALES IN 1996, 1997 OR 1998. NET SALES BY GEOGRAPHICAL AREA ARE BASED ON THE LOCATION OF THE FACILITY PRODUCING THE SALES. OPERATING INCOME BY BUSINESS SEGMENT AND GEOGRAPHICAL AREAS ARE BASED ON NET SALES LESS IDENTIFIABLE OPERATING EXPENSES AND ALLOCATIONS. LONG-LIVED ASSETS CONSIST OF INVESTMENT IN NONCONSOLIDATED AFFILIATES, GOODWILL, OTHER ASSETS AND PROPERTY, PLANT AND EQUIPMENT, NET OF DEPRECIATION. LONG-LIVED ASSETS BY GEOGRAPHICAL AREA ARE BASED ON LOCATION OF FACILITIES. 195

PAGE 46 QUARTERLY FINANCIAL DATA (UNAUDITED) [DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS] NET EARNINGS (LOSS) ----------------------------- Net Gross Per Share Stock Price Dividends Sales Profit Amount Basic Diluted High Low Declared ---------------------------------------------------------------------------------------------------------- 1998 First $160,587 $ 43,069 $ 9,645 $0.35 $0.34 $24.63 $17.63 $0.05625 Second 154,340 38,239 7,450 0.27 0.26 25.00 15.75 0.06500 Third 140,105 34,906 4,678 0.18 0.18 20.50 13.25 0.06500 Fourth 151,275 36,634 5,863 0.23 0.23 16.19 12.25 0.06500 ---------------------------------------------------------------------------------------------------------- Year $606,307 $152,848 $27,636 $1.04 $1.02 $25.00 $12.25 $0.25125 1997 First $165,418 $ 44,616 $ 8,954 $0.33 $0.32 $22.63 $18.63 $0.05000 Second 159,100 44,144 9,893 0.36 0.35 22.38 18.50 0.05625 Third 136,015 37,746 7,857 0.28 0.28 21.88 19.00 0.05625 Fourth 161,973 42,674 10,840 0.39 0.38 23.88 19.00 0.05625 ---------------------------------------------------------------------------------------------------------- Year $622,506 $169,180 $37,544 $1.36 $1.33 $23.88 $18.50 $0.21875 1996 First $148,914 $ 39,999 $ 6,946 $0.26 $0.25 $15.07 $12.13 0.03750 Second 166,849 43,913 8,501 0.32 0.30 17.00 14.75 0.05000 Third 148,048 40,583 6,578 0.24 0.24 18.00 14.13 0.05000 Fourth 180,720 47,573 (777) (0.03) (0.03)1 19.75 16.88 0.05000 ---------------------------------------------------------------------------------------------------------- Year $644,531 $172,068 $21,248 $0.78 $0.76 $19.75 $12.13 $0.18750 EARNINGS PER SHARE ARE COMPUTED INDEPENDENTLY FOR EACH OF THE QUARTERS. THEREFORE, THE SUM OF THE QUARTERLY EARNINGS PER SHARE MAY NOT EQUAL THE TOTAL FOR THE YEAR. (1) AFTER A PRE-TAX ASSET VALUATION CHARGE OF ASSETS OF $15,800, ($10,100 AFTER TAX) OR $0.36 PER SHARE. 196

PAGE 47 INDEPENDENT AUDITORS' REPORT TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF VALMONT INDUSTRIES, INC. We have audited the accompanying consolidated balance sheets of Valmont Industries, Inc. and subsidiaries as of December 26, 1998 and December 27, 1997, and the related consolidated statements of operations, shareholders' equity and cash flows for each of the three years in the period ended December 26, 1998. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Valmont Industries, Inc. and subsidiaries as of December 26, 1998 and December 27, 1997, and the results of their operations and their cash flows for each of the three years in the period ended December 26, 1998 in conformity with generally accepted accounting principles. /s/ DELOITTE & TOUCHE LLP - ---------------------------- DELOITTE & TOUCHE LLP Omaha, Nebraska February 5, 1999 REPORT OF MANAGEMENT The consolidated financial statements of Valmont Industries, Inc. and Subsidiaries and the other information contained in the Annual Report were prepared by and are the responsibility of management. The statements have been prepared in accordance with generally accepted accounting principles and necessarily include amounts based on management's best estimates and judgements. In fulfilling its responsibilities, management relies on a system of internal controls which provide reasonable assurance that the financial records are reliable for preparing financial statements and maintaining accountability of assets. Internal controls are designed to reduce the risk that material errors or irregularities in the financial statements may occur and not be timely detected. These systems are augmented by written policies, careful selection and training of qualified personnel, an organizational structure providing for the division of responsibilities and a program of financial, operational and systems audits. The Company also has a business ethics policy which requires employees to maintain high ethical standards in the conduct of Company business. The Audit Committee, composed of non-employee directors is responsible for recommending to the Board of Directors, subject to ratification of shareholders, the independent accounting firm to be retained each year. The Audit Committee meets regularly, and when appropriate separately, with the independent certified public accountants, management and the internal auditors to review company performance. The independent certified public accountants, internal auditors, and the Audit Committee have unrestricted access to each other in the discharge of their responsibilities. Signature Signature /s/ Mogens C. Bay /s/ Terry J. McClain - ------------------------------------ ------------------------------------------------- Mogens C. Bay Terry J. McClain Chairman and Chief Executive Officer Senior Vice President and Chief Financial Officer 197

PAGE 48 OFFICERS AND MANAGEMENT CORPORATE - ------------------------------- CORPORATE OFFICERS - ------------------------------- MOGENS C. BAY* CHAIRMAN AND CHIEF EXECUTIVE OFFICER VINCENT T. CORSO* SENIOR VICE PRESIDENT AND CHIEF OPERATING OFFICER THOMAS P. EGAN, JR. VICE PRESIDENT CORPORATE COUNSEL AND SECRETARY TERRY J. MCCLAIN* SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER E. ROBERT MEANEY* SENIOR VICE PRESIDENT VALMONT INTERNATIONAL BRIAN C. STANLEY VICE PRESIDENT AND CONTROLLER MARK E. TREINEN VICE PRESIDENT BUSINESS DEVELOPMENT *MEMBER, OFFICE OF THE PRESIDENT DIVISIONS - ------------------------------- LIGHTING & UTILITY - ------------------------------- VINCENT T. CORSO (ACTING) PRESIDENT LEONARD M. ADAMS VICE PRESIDENT OPERATIONS, NORTH AMERICA RICHARD M. SAMPSON VICE PRESIDENT SALES THOMAS F. SANDERSON VICE PRESIDENT MARKETING AND PROJECT DEVELOPMENT THOMAS J. SUTKO VICE PRESIDENT ADMINISTRATION INDUSTRIAL PRODUCTS DIVISION - ------------------------------- JOHN V. FOLEY PRESIDENT IRRIGATION DIVISION - ------------------------------- THOMAS D. SPEARS PRESIDENT DUANE BIER VICE PRESIDENT OPERATIONS JAMES J. EITING VICE PRESIDENT KEY ACCOUNTS HECTOR A. HAGET VICE PRESIDENT MARKETING AND ENGINEERING TERRY RAHE PRESIDENT CASCADE EARTH SCIENCES DENNIS E. SCHWIEGER VICE PRESIDENT GLOBAL SALES COATINGS DIVISION - ------------------------------- JEFFREY BRIGGS PRESIDENT RICHARD S. CORNISH VICE PRESIDENT OPERATIONS COMMUNICATION DIVISION - ------------------------------- JAMES R. CALLAWAY PRESIDENT SEAN GALLAGHER VICE PRESIDENT SALES J. MARSHALL HAINES VICE PRESIDENT OPERATIONS VALMONT ASIA/PACIFIC - ------------------------------- E. ROBERT MEANEY (ACTING) PRESIDENT VALMONT EUROPE/MIDDLE EAST/AFRICA - ------------------------------- JAN A.M. DRIESSENS PRESIDENT PAUL VAN ISEGHEM VICE PRESIDENT OPERATIONS - -------------------------------- CORPORATE HEADQUARTERS Valmont Industries, Inc. One Valmont Plaza Omaha, Nebraska 68154 USA 402.963.1000 INDEPENDENT PUBLIC ACCOUNTANTS Deloitte & Touche LLP Omaha, Nebraska USA LEGAL COUNSEL McGrath, North, Mullin & Kratz, P.C. Omaha, Nebraska USA STOCK TRANSFER AGENT AND REGISTRAR First National Bank of Omaha Trust Department One First National Center Omaha, Nebraska 68102 USA 402.341.0500 Notices regarding changes of address and inquiries regarding lost or stolen certificates and transfers of stock should be directed to the transfer agent. ANNUAL MEETING The annual meeting of Valmont's shareholders will be held at 2:00 p.m. on Monday, April 26, 1999, at the Joslyn Art Museum in Omaha, Nebraska USA SHAREHOLDER AND INVESTOR RELATIONS Valmont's common stock trades on the Nasdaq national market under the symbol VALM. Valmont's most recent Quarterly News Releases are available on the internet at www.valmont.com under the heading "Valmont News." Valmont maintains an active investor relations program and mailing list to keep shareholders and potential investors informed about the Company. Comments and inquiries are welcomed and should be directed to Investor Relations. A copy of Valmont's 1998 Annual Report on form 10-K may be obtained by calling or writing Investor Relations: Jeffrey S. Laudin Investor Relations Department Valmont Industries, Inc. One Valmont Plaza Omaha, Nebraska 68154 USA Phone: 402.963.1000 Fax: 402.963.1199 MARKET MAKERS The following make a market in Valmont Industries, Inc. common stock as of February 1999: George K. Baum & Company, Dain Rauscher Inc.,Herzog, Heine, Geduld, Inc., Kirkpatrick Pettis Inc., Knight Securities, L.P., Spear, Leeds & Kellogg, Sherwood Securities. Visit Valmont's Website: www.valmont.com 198

(INSIDE BACK COVER) BOARD OF DIRECTORS MOGENS C. BAY CHAIRMAN AND CHIEF EXECUTIVE OFFICER VALMONT INDUSTRIES, INC. DIRECTOR SINCE 1993 ROBERT B. DAUGHERTY FOUNDER AND CHAIRMAN EMERITUS VALMONT INDUSTRIES, INC. DIRECTOR SINCE 1947 CHARLES M. HARPER FORMER CHAIRMAN AND CEO RJR NABISCO HOLDINGS CORP. AND CONAGRA, INC. DIRECTOR SINCE 1979 ALLEN F. JACOBSON RETIRED CHAIRMAN AND CEO 3M COMPANY DIRECTOR SINCE 1976 LLOYD P. JOHNSON RETIRED CHAIRMAN OF THE BOARD NORWEST CORPORATION DIRECTOR SINCE 1991 JOHN E. JONES RETIRED CHAIRMAN, PRESIDENT AND CEO CBI INDUSTRIES, INC. DIRECTOR SINCE 1993 THOMAS F. MADISON PRESIDENT, MLM PARTNERS CHAIRMAN OF THE BOARD COMMUNICATIONS HOLDINGS, INC. DIRECTOR SINCE 1987 WALTER SCOTT, JR. CHAIRMAN LEVEL 3 COMMUNICATIONS, INC. DIRECTOR SINCE 1981 KENNETH E. STINSON CHAIRMAN AND CEO PETER KIEWIT SONS', INC. DIRECTOR SINCE 1996 ROBERT G. WALLACE RETIRED EXECUTIVE VICE PRESIDENT PHILLIPS PETROLEUM CO. DIRECTOR SINCE 1984 AUDIT COMMITTEE WALTER SCOTT, JR., CHAIRMAN JOHN E. JONES ROBERT G. WALLACE COMPENSATION COMMITTEE ALLEN F. JACOBSON, CHAIRMAN CHARLES M. HARPER LLOYD P. JOHNSON THOMAS F. MADISON FROM LEFT ALLEN F. JACOBSON KENNETH E. STINSON WALTER SCOTT, JR. ROBERT B. DAUGHERTY MOGENS C. BAY THOMAS F. MADISON CHARLES M. HARPER JOHN E. JONES LLOYD P. JOHNSON ROBERT G. WALLACE 199

(BACK COVER) Valmont Logo One ValmontPlaza Omaha, Nebraska 68154-5215 USA 402.963.1000 fax 402.963.1199 www.valmont.com 200

Exhibit 21 SUBSIDIARIES OF VALMONT INDUSTRIES, INC. State or Country Name of Subsidiary of Incorporation ------------------ ---------------- American Lighting Standards Corp. d/b/a Valmont/ALS Texas Best-All Electric, Inc. Nebraska Cascade Earth Sciences, Ltd. Oregon Clearwater International, Inc. Oregon Gate City Steel Corporation Delaware Golden State Irrigation, Inc. California InterAg Technologies, Inc. Delaware KUO Testing Labs, Inc. Washington Lampadaires Feralux, Inc. Canada Microflect Company, Inc. Oregon NeuValco S.A. France NeuValco GmbH Germany Oregon Pacific Group, LLC. Oregon Sermeto S.A. France Sermeto Iberica S.A. Spain Shanghai Valmont Special Steel Tube Co., Ltd. China TelecCentre, S.A. France Tubalco S.A. France Valmont California Irrigation, Inc. California Valmont Composites, LLC Utah Valmont de Espana, S.A. Spain Valmont Mastbau, KG Germany Valmont S.A. Spain Valmont Industria e Comercio, Ltd. Brazil Valmont Industries (Asia-Pacific) Ltd. Hong Kong Valmont Industries Holland B.V. The Netherlands Valmont International, L.L.C. Delaware Valmont International Corp. Texas Valmont International Inc. U. S. Virgin Islands Valmont Nederlands B.V. The Netherlands Valmont Northwest, Inc. Nebraska Valmont Polska Sp. zp.p Poland Valmont Service Centers, Inc. Nebraska Valmont Services Irrigacao, Ltd. Brazil Valmont World Trade, N.V. Netherlands Antilles 201

Exhibit 23 DELOITTE & TOUCHE LLP (letterhead) 2000 First National Center Telephone 402-346-7788 Omaha, NE 68102-1578 Facsimile 402-346-0711 402-344-0372 INDEPENDENT AUDITORS' CONSENT - ----------------------------- We consent to incorporation by reference in Registration Statements No. 2-88663, 33-21680, 33-57117, and 333-02785 of Valmont Industries, Inc. on Form S-8 of our reports dated February 5, 1999 appearing in or incorporated by reference in the Annual Report on Form 10-K of Valmont Industries, Inc. for the year ended December 26, 1998. DELOITTE & TOUCHE LLP Omaha, Nebraska March 24, 1999 202

Exhibit 24 POWER OF ATTORNEY The undersigned Directors of Valmont Industries, Inc., a Delaware corporation, hereby constitute and appoint Mogens C. Bay as attorney-in-fact in their name, place and stead to execute Valmont's Annual Report on Form 10-K for the fiscal year ended December 26, 1998, together with any and all subsequent amendments thereof in their capacity as Chairman of the Board and hereby ratify all that said attorney-in-fact may do by virtue thereof. DATED this 24th day of February, 1999. /s/ Robert B. Daugherty /s/ John E. Jones - ------------------------------- ----------------------------- Robert B. Daugherty, Director John E. Jones, Director /s/ Charles M. Harper /s/ Thomas F. Madison - ------------------------------- ----------------------------- Charles M. Harper, Director Thomas F. Madison, Director /s/ Allen F. Jacobson /s/ Walter Scott, Jr. - ------------------------------- ----------------------------- Allen F. Jacobson, Director Walter Scott, Jr., Director /s/ Lloyd P. Johnson /s/ Kenneth E. Stinson - ------------------------------- ----------------------------- Lloyd P. Johnson, Director Kenneth E. Stinson, Director /s/ Robert G. Wallace /s/ Charles D. Peebler, Jr. - ------------------------------- ----------------------------- Robert G. Wallace, Director Charles D. Peebler, Jr. /s/ Bruce Rhode - ------------------------------- Bruce Rhode 203

5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM SEC FORM 10-K AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 YEAR DEC-26-1998 DEC-26-1998 7,580 0 115,843 0 77,694 219,946 292,944 135,497 406,957 120,480 0 0 0 27,900 148,013 406,957 606,307 606,307 453,459 453,459 105,096 0 4,216 43,536 15,900 27,636 0 0 0 27,636 1.04 1.02