Document:

Employment Agreement - Tommy A. Valenta

 Exhibit 10.9 
  
 EMPLOYMENT AGREEMENT 
  
 This Agreement, made effective as of the 29th day of July, 2005, by and between CHAPARRAL STEEL COMPANY, a Delaware corporation
(hereinafter referred to as the “Company”), and TOMMY A. VALENTA (hereinafter referred to as the “Employee”). 
  
 WITNESSETH: 
  
 WHEREAS, Employee has been elected to the position of President and Chief Executive Officer of the Company and as a member of its Board of
Directors; and 
  
 WHEREAS, the Company is
desirous of insuring the retention of Employee’s services, on the terms and conditions herein set forth, and Employee is willing to render such services: 
  

NOW, THEREFORE, the Company and the Employee, in consideration of the premises and promises each to the other herein contained, have
agreed and do hereby agree and covenant as follows: 
  
 1. Services 
  
 (a) The Company agrees to employ the Employee as an executive of the Company, during the three (3) year period ending July 29, 2008 (the “term” hereof), and the Employee agrees to serve the Company in such capacity during such
term. Employee agrees to devote all of his time and attention during normal business hours during such term to the business and affairs of the Company, its subsidiaries and affiliates; to serve as a Director of the Company and/or one or more of its
subsidiaries or affiliates if elected as such and to hold the offices with the Company and/or its subsidiaries or affiliates to which, from time to time, he may be elected or appointed during said period. Employee shall have the duties and
responsibilities normally appurtenant to the office of the President and Chief Executive Officer. 
  
 (b) Employee agrees not to engage in any line of work or endeavor which might detract from his full attention to his
duties hereunder, without obtaining in any such case the prior approval of the Directors of the Company. 

 2. Compensation 
  
 (a) During the term hereof, the Company agrees to compensate Employee for his services as
follows: 
  
 (i) Base Annual
Compensation. Employee shall receive a base salary at the rate of Five Hundred Thousand Dollars ($500,000.00) per annum payable in periodic installments in accordance with the Company’s payment practices and procedures. 
  
 (ii) Incentive Compensation. Employee
shall participate in the Company’s Annual and Three-Year Incentive Plans as and if established from time to time by the Compensation Committee of the Board of Directors and approved by the Board of Directors. 
  
 (iii) Participation in Equity and
Non-Equity Plans. Employee shall participate in any plan established by the Company to permit employees to participate in the appreciation in value of the common stock of the Company and will receive an initial stock option award in the amount
of 400,163 shares of the Company’s common stock, $.01 par value per share, pursuant to the terms of the Company’s Amended and Restated 2005 Omnibus Equity Compensation Plan. In the event that Employee shall cease to be an employee of the
Company but continues as a Director, Employee shall continue to participate in such equity or non-equity plan in which Employee participates at the cessation of employment on the same terms and conditions. 
  
 (iv) Deferral of Payment of
Incentive-Based Compensation. In the event that Employee’s base annual compensation and incentive compensation earned during any one fiscal year is greater than $900,000.00, the Board of Directors may, in its sole discretion upon
recommendation by the Compensation Committee, defer payment of such amount in excess of $900,000.00 until termination of Employee’s employment (whether or not such termination occurs during or subsequent to the term of this Agreement), and such
excess amount shall be distributed to Employee in three (3) equal annual installments with the first installment being made one (1) month after such termination of employment. All amounts deferred hereunder shall be assumed to be invested in the

 common stock of the Company at a price equal to the mean between the high and low sales
prices of a share of common stock of the Company on the NASDAQ Exchange (“fair market value”) during the period the amount is deferred. During such deferral period, the account shall be credited with all applicable stock dividends, and
cash dividends shall be credited to such account in the form of common stock of the Company at a value equal to the fair market value of the stock on the date of payment of such dividend. Shares of the common stock of the Company credited to the
account shall be adjusted to reflect any increase or decrease in the number of shares outstanding as a result of stock split-ups, combination of shares, recapitalizations, mergers or consolidations. 
  
 (b) Nothing in this Agreement is intended to
prevent or limit the right of Employee to participate or share in any group life, health or similar insurance program or any retirement, pension plan or other benefit program properly established for the benefit of employees of the Company. Nor
shall anything in this Agreement prevent the Company from increasing the compensation to be paid Employee for his services hereunder in the event the Board of Directors shall deem it advisable to do so in order to fully compensate Employee for such
services, but nothing herein contained shall obligate the Company to make any such increases. 
  
 3. Early Termination 
  
 (a) In the event of the consummation, during the term of this Agreement, of any of the transactions referred to in paragraph 1 of Article FIFTEENTH of the Company’s Certificate of
Incorporation, which transaction was not approved by the Board of Directors of the Company in accordance with paragraph 2 of said Article FIFTEENTH, Employee may, at his sole election, terminate his service to the Company hereunder for any reason
(or for no reason) at any time after the consummation of any such unapproved transaction by giving the Company at least thirty (30) days prior written notice. If Employee voluntarily terminates such service: (i) he shall be paid, upon termination,
an amount equal to the total compensation (base annual compensation and incentive compensation) earned in the fiscal year immediately preceding the fiscal year in which such termination occurs, times two; and (ii) all options Employee has to
purchase stock under the Company’s Amended and Restated 2005 Omnibus Equity Compensation Plan will be immediately accelerated and vested in Employee. In addition, the Agreement Not to Compete set forth in 

 paragraph 4 below and any provision relating to non-competition applicable to
Employee’s right to receive retirement benefits under the Company’s Executive Financial Security Plan shall be deemed waived by the Company. 
  
 (b) In the event Employee’s service is terminated by reason other than (i) cause, or (ii) the transactions referred
to in subparagraph (a) above, Employee shall be paid an amount equal to the total compensation earned in the fiscal year immediately preceding the fiscal year in which such termination occurs. For the purpose of this subparagraph (b),
“cause” shall mean any action involving willful malfeasance or gross negligence or gross non-feasance. 
  
 4. Agreement Not to Compete 
  
 (a) The Employee agrees that in the event his employment with the Company is terminated for any reason whatsoever other
than because of his death, or early termination pursuant to paragraph 3(a) above, Employee shall not, for a period of two (2) years after the date of such termination of employment, directly or indirectly, carry on or conduct, in competition with
the Company or its subsidiaries or affiliates, any business of the nature in which the Company or its subsidiaries or affiliates are then engaged. Employee agrees that he will not so conduct or engage in any such business either as an individual on
his own account or as a partner or joint venturer or as an employee, agent, consultant or salesman for any other person or entity, or as an officer or director of a corporation or as a shareholder in a corporation of which he shall then own ten
percent (10%) or more of any class of stock. The provisions of this paragraph 4 shall supersede any and all non-compete provisions contained in any and all other agreements which have been entered into between Employee and the Company and shall
survive the termination of this Agreement. 
  
 (b) The Employee agrees that in the event of a breach of the terms and conditions of this paragraph 4 by the Employee, the Company shall be entitled, if it so elects, to institute and prosecute proceedings, either in
law or in equity, against Employee, to obtain damages for any such breach, or to enjoin Employee from performing services for any competitor of the Company in violation hereof during the period for which the Employee has agreed herein not to compete
with the Company after the termination of his employment with the Company. 

 5. Successors and Assigns: Modifications 
  
 The rights and obligations of the Company under this
Agreement shall inure to the benefit of and shall be binding upon the successors and assigns of the Company. This Agreement shall not be modified, changed or in any way amended except by instrument in writing executed by the parties hereto.

  

			
	 CHAPARRAL STEEL COMPANY

		
	 By:
	 	 /s/ J. Celtyn Hughes

	 	 	 J. Celtyn Hughes, Vice President and

	 	 	 Chief Financial Officer

	
	 ATTEST:

	
	 /s/ Robert E. Crawford, Jr.

	 Robert E. Crawford, Jr.

	 Secretary

	
	 EMPLOYEE

	
	 /s/ Tommy A. Valenta

	 Tommy A. ValentaForm of Incentive and Nonqualified Stock Option Agreement

 Exhibit 10.10 
  
 STOCK OPTION AGREEMENT UNDER 
 CHAPARRAL STEEL COMPANY 
 AMENDED AND RESTATED 
 2005 OMNIBUS EQUITY COMPENSATION PLAN 
  
 Pursuant to its Amended and Restated 2005 Omnibus Equity Compensation Plan, CHAPARRAL STEEL COMPANY (the “Company”), effective
as of July 29, 2005, hereby grants to                      an Option to purchase an aggregate of
                     shares of the Common Stock, $0.01 par value, of the Company at the price per share set forth on Schedule I hereto, and
otherwise on the terms and conditions hereinafter set forth, of which the Option to purchase                      Shares is an Incentive Stock
Option and the Option to purchase                      Shares is a Nonqualified Stock Option. These Options are granted in connection with the
spin-off of the Company from TXI. 
  
 ARTICLE I  

Definitions 
  

	 (a)
	 “Board” means the Board of Directors of Chaparral Steel Company. 

  

	 (b)
	 “Code” means the Internal Revenue Code of 1986, as amended, and the regulations thereunder. 

  

	 (c)
	 “Committee” means the committee, if any, appointed by the Board of Directors to administer the Plan. 

  

	 (d)
	 “Common Stock” means shares of the Company’s Common Stock, $0.01 par value. 

  

	 (e)
	 “Company” means Chaparral Steel Company and its Subsidiaries. 

  

	 (f)
	 “Disability” means the occurrence of an event which would entitle an employee of the Company to the payment of disability income under the
Company’s insurance plans. 

  

	 (g)
	 “Effective Date” means the date of the grant of this Option, as set forth above. 

  

	 (h)
	 “Fair Market Value” is the mean between the high and low sales price of a share of Common Stock on the Nasdaq Stock Market on a particular reference
date. 

  

	 (i)
	 “Grantee” means the person named above to whom this Option has been granted, except where the context plainly otherwise requires.

  

	 (j)
	 “Option” means the Incentive Stock Option and/or Nonqualfied Stock Option herein granted. 

  

	 (k)
	 “Option Price” means the amount per share of Common Stock required to be paid upon the exercise of this Option, as set forth on Schedule I, or such
other amount per share of Common Stock as may result by operation of Article V of this Agreement. 

	 (l)
	 “Optioned Shares” means the number of shares of Common Stock represented by this Option, as set forth above, or such other amount as may result by
operation of Article V of this Agreement. 

  

	 (m)
	 “Plan” means the Chaparral Steel Company Amended and Restated 2005 Omnibus Equity Plan. 

  

	 (n)
	 “Retirement” means the termination of employment of a Grantee from active service with the Company under circumstances which would entitle an employee
of the Company to benefits under the Company’s approved retirement plans, as such plans may be approved or amended from time to time. 

  

	 (o)
	 “Stock” or “Shares of Stock” means the Common Stock, or stock of any corporation into which the Common Stock shall be changed or for which
the Common Stock shall be exchanged pursuant to paragraph (b) of Article V hereof. 

  

	 (p)
	 “Subsidiary” means any entity of which, at the time such subsidiary status is to be determined, at least 50% of the total combined voting power of all
classes of stock in such entity is held by the Company and its Subsidiaries (exclusive of the ownership by the entity whose subsidiary is being determined). 

  

	 (q)
	 “Successor” means the legal representative of the estate of a deceased Grantee or the person or persons who shall acquire the right to exercise an
Option by bequest or inheritance or by reason of the death of the Grantee. 

  

	 (r)
	 “Term” means the period during which the Option granted hereby may be exercised. 

  

	 (s)
	 “TXI” means Texas Industries, Inc., a Delaware corporation. 

  

	 (t)
	 Each other capitalized term that is used but not defined in this Agreement shall have the meaning prescribed in the Plan. 

  
 ARTICLE II 
 Term of Option and Exercise 
  

	 (a)
	 The term of this option shall commence on the Effective Date and shall terminate, unless sooner terminated by the terms of the Plan or of this Agreement, at:

  

	 	 (i)
	 the close of the Company’s business on the day identified as the Expiration Date on Schedule I hereto, if the Company is open for business on such day; or

  

	 	 (ii)
	 if the Company is not open for business on such day, the close of the Company’s business on the next preceding day that the Company is open for business.

  

	 (b)
	 Subject to the terms of the Plan, this Option may be exercised, at the times and in the amounts set forth on Schedule I, by delivery of written notice of
exercise as provided in Article III hereof, unless this Option shall cease to be exercisable at an earlier date pursuant to Article IV hereof. 

  

 2 

 ARTICLE III 
 Method of Option Exercise 
  

	 (a)
	 In order to exercise this Option, the Grantee must deliver or mail to the Company’s General Counsel or his/her designee: 

  

	 	 (i)
	 a written notice, in a form prescribed by the Company, indicating: 

  

	 	 (1)
	 the intent to exercise this Option; 

  

	 	 (2)
	 whether the Option being exercised is an Incentive Stock Option or a Nonqualified Stock Option, and the number of Optioned Shares and the Option Price to which
such exercise relates; 

  

	 	 (3)
	 whether such shares shall be issued in the Grantee’s name, or in the Grantee’s name and the name of another person, the nature of the tenancy (joint
tenants with right of survivorship, tenants in common, etc.) together with the Social Security Number(s) of the person(s) whose name(s) will appear on the certificates. 

  

	 	 (4)
	 denomination(s) of the certificate(s) desired; 

  

	 	 (5)
	 the address of record for delivery of the certificate(s) and any subsequent stockholder mailing; and 

  

	 	 (ii)
	 payment as appropriate as follows: 

  

	 	 (1)
	 Grantee’s check or money order, payable to the Company, in an amount equal to the Option Price times the number of Option Shares being exercised; or

  

	 	 (2)
	 whole Shares of Common Stock already beneficially owned by the Grantee for a period of at least six (6) months, the aggregate Fair Market Value of which (on the
date of exercise) equals or exceeds the Option Price times the number of shares being exercised, together with a duly executed stock power (with signature guaranteed) conveying such shares to the Company; or 

  

	 	 (3)
	 a check or money order payable to the order of the Company plus whole shares of Common Stock already beneficially owned by the Grantee for at least six (6)
months, the aggregate of which, determined as provided in subparagraphs (1) and (2) above equals the Option Price times the number of Optioned Shares being exercised. 

  

 3 

	 (b)
	 Upon receipt of such notice and payment, the Company shall deliver to the Grantee, as soon thereafter as practicable, a certificate or certificates in the
Grantee’s name, or in the Grantee’s name and the name of another person, as the Grantee shall have requested, for such number of Optioned Shares. 

  
 ARTICLE IV 
 Termination of Option 
  

	 (a)
	 If the Grantee shall cease, for reason of death, Disability or Retirement, to be employed by the Company during the Term of the Option, the Grantee or Successor
of the Grantee may exercise the Option until the earlier of the expiration of the Term of the Option; or 

  

	 	 (i)
	 a period not to exceed one (1) year following such cessation of employment by reason of death or Disability; or 

  

	 	 (ii)
	 a period not to exceed three (3) months following such cessation by reason of Retirement. 

  

	 (b)
	 If the Grantee shall cease, for a reason other than death, Disability or Retirement, to be employed by the Company during the Term of the Option, the Grantee may
exercise the Option (to the extent that Grantee was entitled to do so at the date of cessation of employment) until the earlier of: 

  

	 	 (i)
	 the expiration of the Term of the Option; or 

  

	 	 (ii)
	 a period not to exceed three (3) months following such cessation of employment; provided, however, that in the event of the termination of employment of a
Grantee on account of fraud, dishonesty or other acts detrimental to the interests of the Company or a Subsidiary, this Option and any and all rights hereunder shall automatically terminate as of the date of such termination of employment.

  

	 (c)
	 If the Grantee shall cease for any reason whatsoever to be employed by the Company or a Subsidiary prior to the vesting of any portion of this Option, the Option
shall terminate immediately upon cessation of employment. 

  

	 (d)
	 In no event shall any Option or installment granted herein become exercisable by the Grantee or Successor of the Grantee at any time after the date the Grantee
ceases to be employed by the Company or a Subsidiary, for any reason whatsoever, unless such Option or installment is then exercisable at the date of such cessation of employment. 

  

	 (e)
	 A transfer of the Grantee’s employment from the Company to a Subsidiary of the Company or vice versa, or from one Subsidiary to another, without an
intervening period, shall not be deemed a cessation of employment with the Company. 

  

 4 

	 (f)
	 Except as otherwise herein provided, exercise of this Option or any installment hereunder by the Grantee or the Successor of the Grantee, shall be subject to all
terms and conditions of this Agreement. 

  
 ARTICLE V 
 Adjustment Upon Changes in Capitalization 
  

	 (a)
	 In the event of an increase in the number of outstanding Shares of Stock due to a change in capitalization occurring through a stock dividend or a stock split,
there shall be a proportionate increase in the number of Optioned Shares which remain exercisable under this Agreement and a proportionate reduction in the Option Price; provided, however, that any fractional Shares of Stock resulting from such
adjustment shall be eliminated. In the event of any change in capitalization other than those considered above, the Board shall make such adjustments in the number of Optioned Shares which remain exercisable under this Agreement, and in the Option
Price, as the Board in its discretion may consider appropriate, and all such adjustments shall be conclusive upon all persons, provided that no change shall be made in the terms of this Option which would disqualify it from treatment under Section
421 of the Code or would be considered a modification, extension, or renewal of the Option under Section 424 of the Code. 

  

	 (b)
	 In the event that the Shares of Stock shall be exchanged for or replaced by shares of stock of another corporation by reason of a corporate merger,
consolidation, acquisition of property or stock, separation, reorganization or liquidation, or other corporate transactions involving the Company, there shall be substituted for the number of Optioned Shares which remain exercisable under this
Agreement that number of shares of stock of such corporation which is proportionate to such number of Optioned Shares in accordance with the terms of the exchange; and there shall be made such other changes in the number, kind or price of the
Optioned Shares which remain exercisable under this Agreement as shall be necessary to give effect to the intent of this Article V. 

  
 ARTICLE VI 
 Change of Control

  
 In the event the Company or the stockholders
of the Company enter into an agreement not approved by a vote of eighty percent (80%) of the Board of Directors in accordance with Article FIFTEENTH of the Company’s Certificate of Incorporation to dispose of all or substantially all of the
assets or stock of the Company by means of a sale, reorganization, liquidation or otherwise, this Option shall become immediately exercisable with respect to the full number of shares subject to this Option; notwithstanding the specific terms of
this Option, during the period commencing as of the date of such agreement and ending when the disposition of assets or stock contemplated by the agreement is consummated or the agreement is terminated. 
  

 5 

 ARTICLE VII 
 Restrictions on Sales 
  
 Grantee may not sell or otherwise dispose of shares of Common Stock received upon exercise of this Option unless the shares of Common Stock to be issued have been duly registered under the Securities Act of 1933 and
any applicable state securities laws, or the Grantee provides to the Company an opinion of counsel acceptable to the Company that no such registration is required. 
  
 ARTICLE VIII  
 Other Terms 
  

	 (a)
	 Grantee understands that (i) the Grantee shall not have any rights as a stockholder with respect to any Common Stock received upon exercise of this Option until
such Common Stock has been actually issued to the Grantee in accordance with the terms hereof; and (ii) nothing in this Agreement or the Plan shall confer on Grantee any right to continue in the employ of the Company or a Subsidiary or interfere in
any way with the right of the Company or a Subsidiary to terminate his or her employment at any time, with or without cause, notwithstanding the possibility that the number of Shares purchasable or exercisable by Grantee under this Option thereby be
reduced or eliminated. 

  

	 (b)
	 Anything herein to the contrary notwithstanding, the Company may postpone the exercise of this Option for such time as the Board of Directors or the Committee in
its discretion may deem necessary, in order to permit the Board of Directors or the Committee with reasonable diligence (i) to effect or maintain registration under the Securities Act of 1933, as amended (the “Act”), of the Plan or the
shares of Common Stock issuable upon the exercise of this Option, or (ii) to determine that the Plan and such shares are exempt from registration; and the Company shall not be obligated by virtue of this Option or to sell or issue shares of Common
Stock in violation of said Act or of the law of any applicable jurisdiction. Any such postponement shall not extend the Term of this Option; and neither the Company nor its Board nor the Committee shall have any obligation or liability to the
Grantee or to the Grantee’s Successor, with respect to any Shares of Common Stock as to which this Option shall lapse because of such postponement. 

  

	 (c)
	 Subject to Article IV of this Agreement, this Option shall be non-transferable and non-assignable except by will and by the law of descent and distribution.
During the Grantee’s lifetime, this Option may be exercised only by the Grantee. 

  

	 (d)
	 The Grantee agrees that in the event Grantee makes any sale or other disposition of the Shares of Common Stock issued upon exercise of this Option that Grantee
shall promptly notify the Company of such sale or disposition and shall furnish the Company with such information concerning such sale or disposition as may be requested by the Company. 

  

	 (e)
	 As a condition of the granting of this Option, the Grantee or Successor of the Grantee agrees that any dispute or disagreement which may arise hereunder shall be
determined by the Board of Directors or the Committee in its sole discretion and judgment, and that 

  

 6 

 any such determination and any interpretation by the Board of Directors or the Committee
of the terms of this Agreement shall be final and binding and conclusive, for all purposes, upon the Company, the Grantee or the Successor of the Grantee. 
  

	 (f)
	 Any notice given by the Company to the Grantee shall be effective to bind any person who shall acquire rights hereunder. The Company shall be under no obligation
whatsoever to advise the Grantee of the existence, maturity or termination of any of the Grantee’s rights hereunder and the Grantee shall be deemed to have familiarized himself/herself with all matters contained herein and in the Plan which may
affect any of the Grantee’s rights and privileges hereunder. 

  

	 (g)
	 This Agreement is subject to the Plan and its terms and provisions (including any subsequent amendments thereto) which Plan and its terms and provisions are by
this reference hereby incorporated herein. In the event of a conflict between any term or provision contained herein and a term or a provisions of the Plan, the applicable terms and provisions of the Plan will govern and prevail.

  

 7 

 IN WITNESS WHEREOF, CHAPARRAL STEEL COMPANY has caused this Option Agreement to be
executed as of the Effective Date, and Grantee has accepted the terms and provisions thereof. 
  

					
	 CHAPARRAL STEEL COMPANY

		
	 By:
	 	 
	 	 	 Name:
	 	 
	 	 	 Title:
	 	 

  

			
	 ACCEPTED:

	
	 By:

	 Printed Name:
	 	  

  

 8 

 SCHEDULE I 
  

Optionholder:                     

  
 Date of Option Grant: 7/29/05 
  
 Expiration Date of Options:
                     
  
 Exercise Price for Incentive Stock Options: $             
  
 Exercise Price for Nonqualified Stock Option:
$             
  
 VESTING SCHEDULE 
  
 This
Option shall become execisable in accordance with the following schedule: 
  

					
	 Date on and After
 Which Option is
 Exercisable

	 	 Number of
 Incentive
 Stock Options

	 	 Number of
 Nonqualified
 Stock Options

  
  
 The foregoing schedule may be accelerated in the event of a change of control as provided in Article V of the Plan. 
  
 This option is issued pursuant to the requirements of that
certain Separation and Distribution Agreement, dated July 6, 2005, by and between the Company and TXI, and is issued in replacement of the unvested portion of the stock option granted to Grantee on [original grant date] pursuant to which
Grantee was originally granted the right to purchase up to [original number of shares] shares of the common stock, $1.00 par value per share, of TXI.

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