Fill and Sign the Proposal to Approve the Material Terms of the Form

PROPOSAL TO APPROVE THE MATERIAL TERMS OF THE __________ INDUSTRIES, INC. ________________ STOCK APPRECIATION RIGHT P LAN. The Compensation and Stock Option Committee of the Board of Directors has adopted, subject to stockholder approval at the Annual Meeting, the __________ Industries, Inc. _____ Stock Appreciation Right Plan (the “SAR Plan”). If approved, the SAR Plan will be effective as of __________ __, ____. If the stockholders fail to approve the Plan, the Committee may consider adopting an alternative compensation program without stockholder approval, even though some or all of the payments made thereunder may not be deductible by the Company in order to maintain the competitiveness of the Company’s executive compensation program. The Board of Directors believes that the participation of key employees (including officers) of the Company and its subsidiaries in a stock appreciation right plan is an important part of the Company’s compensation program. Participants in the SAR Plan receive a benefit only if the Company’s Common Stock appreciates in value above its fair market value on the date of grant. The full text of the SAR Plan appears as Exhibit B to this Proxy Statement and is incorporated herein by reference. The SAR Plan is summarized below, but such summary is qualified in its entirety by reference to the full text of the SAR Plan. The SAR Plan authorizes the issuance of up to __________ units to employees of the Company, subject to appropriate adjustments for stock dividends, stock splits, recapitalizations or similar changes in outstanding shares of the Company’s Common Stock. A unit is a right which entitles the participant to receive at the time of exercise an amount equal to the differe nce between the fair market value of a single share of Common Stock on the date of exercise and the base price of the unit. The base price of any unit may not be less than the fair market value of a single share of Common Stock on the date the unit is granted. No more than __________ units may be granted to any individual in any ___-month period. If any unit granted to a participant terminates or expires prior to being exercised, such unexercised units will be available for issuance again under the SAR Plan. The units will be awarded for no additional cash consideration from the participants selected. The SAR Plan will be administered by the Compensation and Stock Option Committee (the “Committee”), which consists of three members of the Board of Directors who are not current or former employees or officers of the Company and thus will not at any time during the administration of the SAR Plan receive an award pursuant to the SAR Plan or any discretionary stock option plan of the Company. Subject to the provisions of the SAR Plan, the Committee will have full power to select from among the officers and other employees of the Company or any subsidiary persons eligible for awards, the individuals to whom awards will be granted, the number of units, the duration of each unit, and the base price of each unit. Under certain circumstances, all units will terminate immediately upon the cessation of the employee s employment. In the event of a participant s death, retirement or long-term disability while employed by the Company or a subsidiary (or during the three-month period during which the unit continues to be exercisable after cessation of employment), the participant or the participant s representative may exercise the unit (to the extent exercisable as of the date of death or retirement) within three years after the date of death, retirement or long-term disability, but no later than the expiration date of the unit. The Committee has the discretion to provide for the exercise of all or a portion of unvested units upon death, disability or retirement. The exercise of units under the SAR Plan may be subject to such other terms and conditions not inconsistent with the SAR Plan as the Committee may specify in granting such units. In the event of the merger, consolidation, dissolution or sale of substantially all of its assets, the Company may cancel any unit by giving a ___ day notice and permitting the exercise of any units without regard to vesting provisions.The Board of Directors, acting by a majority of its members, exclusive of Board Members who are eligible to receive awards under the SAR Plan, without further action on the part of the stockholders, may from time to time alter, amend or suspend the SAR Plan or any unit granted under the SAR Plan or may at any time terminate the SAR Plan; provided, however; that the Board may not (i) (except as provided in Section 7 of the SAR Plan) change the total number of units available under the Plan, (ii) increase the maximum term of units or maximum number of units that may be granted to an individual in any ___-month period, (iii) decrease the minimum unit price or otherwise materially increase the benefits accruing to participants under the Plan or (iv) materially modify the eligibility requirements of the Plan, and provided further that no action shall materially and adversely affect any outstanding units without the consent of the respective unit holders. The Board of Directors recommends a vote FOR this Proposal. Annual cash bonus awards and SAR awards to be issued in the future under the Incentive Plan and SAR Plan, respectively, cannot be determined at this time. The following table sets forth: (1) the target and maximum annual cash bonus awards that participants are entitled to receive for fiscal _____ if performance goals are met and (2) SAR awards granted at fair market value on _________ __,_____. NEW PLAN BENEFITS Executive Management Incentive Plan FY 1995 Dollar Value (S) Name and Position Minimum Target Maximum SAR Plan Number of Units __________ $0 $472,973 $543,919 57,486 __________ 0 0 0 13,600 __________ 0 0 0 25,500 __________ 0 0 0 10,000 __________ 0 0 0 14,400 Executive Group 0 472,973 543,919 149,834 Non-Executive Director Group 0 0 0 0 Non-Executive Officer Employee Group 0 0 0 5,422