UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

 

Date of Report (Date of earliest event reported): May 7, 2009

 

Alamo Group Inc.

(Exact name of registrant as specified in its charter)

 

State of Delaware

0-21220

74-1621248

(State or other jurisdiction of incorporation)

(Commission File No.)

(IRS Employer Identification No.)

 

 

1627 E. Walnut Seguin, Texas 78155

(Address of Principal executive offices)

 

Registrant's telephone number, including area code:

(830) 379-1480

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

o   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


 


 

 

 

 

 

 

Item 5.02    Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

 

(e)        Alamo Group 2009 Equity Incentive Plan .  At the 2009 annual stockholder meeting of Alamo Group Inc. (the “Company’), which was held on May 7, 2009, the Company’s stockholders approved the Alamo Group 2009 Equity Incentive Plan (the “EIP”).  The EIP, authorizes the issuance of 400,000 shares of Company common stock. The foregoing description of the IEP is qualified in its entirety by reference to the EIP, a copy of which is filed herewith as Exhibit 10.1 with this current Report on Form 8-K.

Approval of Forms of Award Agreements Under the EIP .  On May 7, 2009, the Board of Directors adopted the following award agreements for use in connection with the EIP:  (1) a form of Restricted Stock Award Agreement; (2) a form of Restricted Stock Unit Award Agreement; and (3) a form of Nonqualified Stock Option Agreement.  The forms of these award agreements are filed herewith as Exhibit 10.2, Exhibit 10.3 and Exhibit 10.4 and incorporated by reference herein.

Option Grants .  The Compensation Committee of the Board approved the following grants of stock options to named executive officers of the Company:  25,000 stock options for Mr. Ronald A. Robinson; 12,000 stock options for Mr. Dan E. Malone; 12,000 stock options for Mr. Richard Wehrle; 12,000 stock options for Mr. Robert H. George; and 10,000 stock options for Mr. Donald C. Duncan.  The options awarded to Messrs. Wehrle, George and Duncan are incentive stock options.  The options awarded to Mr. Robinson and Mr. Malone are nonqualified stock options.  All of the options (a) vest in equal annual installments over the five-year period commencing on the first anniversary of the date of grant (which was May 11, 2009) provided that the officer is employed by the Company on each such date (subject to certain exceptions), (b) have an exercise price equal to the closing price of the Company’s common stock on the New York Stock Exchange on the date of grant and (c) have a term of ten (10) years from such date.  The options are subject to vesting upon a Change in Control, as defined in the relevant plan under which they were issued. Mr. Robinson’s options were granted under the EIP and a copy of the Nonqualified Stock Option Agreement for his grant is attached hereto as Exhibit 10.4.  Mr. Malone’s options were granted under the Company’s First Amended and Restated 1999 Nonqualified Stock Option Plan and a copy of the Nonqualified Stock Option Agreement for his grant is attached as Exhibit 10.5.  The options for Messrs. Wehrle, George and Duncan were all issued under the Company’s 2005 Incentive Stock Option Plan and a copy of the form of Incentive Stock Option Agreement for their awards is attached as Exhibit 10.6.

Restricted Stock Award Grant .  The Compensation Committee of the Board of Directors granted a restricted stock award of 5,000 shares of restricted common stock to Mr. Geoff Davies under the EIP.  The restricted stock award vests in four equal annual installments commencing on the first anniversary of the date of grant (which was May 11, 2009) provided that Mr. Davies is employed by the Company on each such date (subject to certain exceptions).  In the event of a Change in Control (as defined in the EIP) restrictions on the restricted stock will immediately lapse and the restricted period will end, unless the award is either assumed or equitable substitution is made therefor.  A copy of Mr. Davies’ form of Restricted Stock Award Agreement is attached as Exhibit 10.2 hereto and incorporated by reference.

 


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Item 9.01    Financial Statements and Exhibits

(d)           Exhibits

The following exhibit is furnished as part of this Current Report on From 8-K:

 

Exhibit No.

Exhibit Title or Description

   

10.1

Alamo Group 2009 Equity Incentive Plan

   

10.2

Form of Restricted Stock Award Agreement under the 2009 Equity Incentive Plan

   

10.3

Form of Restricted Stock Unit Award Agreement under the 2009 Equity Incentive Plan

   

10.4

Form of Nonqualified Stock Option Agreement under the 2009 Equity Incentive Plan

   

10.5

Form of Nonqualified Stock Option Agreement under the First Amended and Restated 1999 Nonqualified Stock Option Plan

   

10.6

Form of Incentive Stock Option Agreement under the 2005 Incentive Stock Option Plan

 

SIGNATURES

 

 

                Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: May 13, 2009

By:    /s/ Robert H. George

 

                Robert H. George,

 

                Vice President-Administration

 

 


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ALAMO GROUP INC.

 

2009 EQUITY INCENTIVE PLAN

 

Section 1.  Background and Purpose of the Plan.

 

            (a)        Background.    The name of this plan is the Alamo Group Inc. 2009 Equity Incentive Plan (the “Plan”).  Alamo Group Inc., a Delaware corporation (the “Company”), established an incentive compensation plan known as the “First Amended and Restated 1999 Non-Qualified Stock Option Plan,” effective August 31, 1999 (the “1999 Plan”).  The 1999 Plan expires as of July 6, 2009.  Subject to the approval of the Company’s stockholders, the Company now desires to adopt the Plan as of May 7, 2009, to replace the 1999 Plan, as set forth below. 

 

            (b)        Purpose.  The purpose of the Plan is to provide incentives to those officers, employees, and directors of the Company and its direct and indirect subsidiaries whose contributions are essential to the growth and success of the Company’s business, in order to strengthen the long-term commitment of such persons to the Company and its direct and indirect subsidiaries, and to help the Company and its direct and indirect subsidiaries secure and retain the services of such key persons.  To accomplish such purposes, the Plan provides that the Company may grant Nonqualified Stock Options, Restricted Stock, and Restricted Stock Units.  The Plan is intended to permit awards that satisfy the requirements of Section 162(m) of the Code and shall be interpreted in a manner consistent with the requirements therefor.

 

Section 2.  Definitions.

 

            For purposes of the Plan, in addition to terms defined elsewhere in the Plan, the following terms shall be defined as set forth below:

 

            (a)        “Award” means an award of Options, Restricted Stock, or Restricted Stock Units under the Plan.

 

            (b)        “Award Agreement” means, with respect to any Award, the written agreement between the Company and the Participant setting forth the terms and conditions of the Award.

 

            (c)        “Board” means the Board of Directors of the Company.

 

            (d)        “Change in Control” means, unless otherwise provided in an Award Agreement, the first to occur of any one of the events set forth in the following paragraphs:

 

 (i) a change in the ownership of the Company which occurs on the date that any one person, or more than one person acting as a group (as such terms are defined in Section 13(d)(3) of the Exchange Act), becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of Shares representing more than fifty percent (50%) of the total voting power of the issued and outstanding stock of the Company entitled to vote in the election of directors of the Company (“Voting Stock”) and such person or group has the power and authority to vote such Shares; provided, however, that for purposes of this subsection (i), the acquisition of additional Shares by any one person or group who have then been owners of 10% or more of the Shares of the Company for a continuous period at least ten (10) years will not be considered a Change in Control; or

 

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(ii) a change in the effective control of the Company which occurs on the date that a majority of members of the Board is replaced during any twelve (12) month period by directors whose appointment or election is not endorsed by a majority of the members of the Board prior to the date of the appointment or election; or

 

(iii) any sale, lease, exchange, or other disposition (in one transaction or a series of related transactions) of all or substantially all of the assets of the Company (together with the assets of the Company’s direct and indirect subsidiaries) to any person or  more than one person acting as a group (as such terms are defined in Section 13(d)(3) of the Exchange Act); provided, however, that for purposes of this subsection (iii), a transfer of assets by the Company to an entity that is controlled by the Company’s stockholders immediately after the transfer will not be considered a Change in Control;  or

 

(iv) the consummation of a merger or consolidation of the Company with another entity in which immediately following the consummation of the transaction, those stockholders of the Company immediately before the consummation of the transaction cease to own collectively at least fifty percent (50%) of the Voting Stock of the Company.

 

            (e)        “Code” means the Internal Revenue Code of 1986, as amended from time to time, or any successor thereto.

 

            (f)         “Committee” means the Compensation Committee of the Board, as appointed from time to time by at least a majority of the whole Board. 

           

            (g)        “Common Shares” means the shares of common stock, par value $0.10 per share, of the Company.     

 

            (h)        “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.     

 

            (i)         “Fair Market Value” of a Share on a particular date shall mean (1) the closing sale price reported for such Share on the national securities exchange or national market system on which such Share is principally traded on such date (or, if there were no trades on such date, on the most recently preceding day on which there was a sale thereon), or (2) if the Shares are not then listed on a national securities exchange or national market system, or if the value of such Shares is not otherwise determinable, such value as determined by the Committee in good faith in its sole discretion.  In making such determination, the Committee should (but is not required to) use a valuation method that is presumed reasonable under Treas. Reg. §1.409A-1(b)(5)(iv)(B)(2).  If the Committee does not use a method that is presumed reasonable, the Committee nevertheless shall use a method designed to comply with the reasonableness requirements of Treas. Reg. §1.409A-1(b)(5)(iv)(B).

 

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            (j)         “Nonqualified Stock Option” means an Option that by its terms is a nonqualified stock option and that will not be treated as an “incentive stock option” within the meaning of Section 422 of the Code. 

 

            (k)        “Option” means a right to purchase Shares, granted to a Participant pursuant to the Plan.  As used herein, the term “Option” shall include only a Nonqualified Stock Option, and the Plan shall be construed in a manner that will effectuate the intent for all Options granted hereunder to be treated as Nonqualified Stock Options.    

 

            (l)         “Participant” means the holder of an outstanding Award. 

           

            (m)       “Restricted Stock” means Shares issued pursuant to an Award Agreement in accordance with Section 7 of the Plan. 

 

            (n)        “Restricted Stock Unit” means a bookkeeping entry representing an amount equal to the Fair Market Value of one Share, granted pursuant to Section 8 of the Plan.  Each Restricted Stock Unit represents an unfunded and unsecured obligation of the Company.

           

            (o)        “Service Provider” means an employee, officer, or director of the Company or any of the Company’s direct or indirect subsidiaries.  For purposes of this paragraph, the term “direct or indirect subsidiaries” shall refer only to those subsidiaries that qualify as eligible issuers of the Company’s stock under Treas. Reg. §1.409A-1(b)(5)(iii)(E). 

 

            (p)        “Shares” means the Common Shares and the common equity of any successor security.

                       

Section 3.  Shares Subject to the Plan.    

 

            (a)        There shall be reserved and available for issuance under the Plan 400,000 Common Shares.  In determining the terms and conditions of an Award hereunder, the Committee shall not impose any conditions on the Common Shares (such as a mandatory repurchase obligation or a put or call right) that would cause the Common Shares issued under the Award not to be considered “Service Recipient Stock” under Treas. Reg. §1.409A-1(b)(5)(iii).           

 

            (b)        To the extent that (i) an Option expires or is otherwise cancelled or terminated without being exercised as to the underlying Shares, (ii) any Shares subject to any award of Restricted Stock or Restricted Stock Units are forfeited, or (iii) Shares are withheld from payment of an Award in satisfaction of any minimum federal, state, local, or foreign withholding requirements, such Shares shall again be available for issuance in connection with future Awards granted under the Plan.  The Shares issued under the Plan may be authorized but unissued Common Shares, reacquired Common Shares, issued Common Shares held in the Company’s treasury, or any combination of the foregoing.  

 

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            (c)        The Company, during the term of the Plan, will at all times reserve and keep available such number of Shares as will be sufficient to satisfy the requirements of the Plan. 

 

Section 4.  Administration of the Plan. 

 

            (a)        The Plan shall be administered by the Committee.  The Committee shall consist solely of two or more “Non-Employee Directors,” as defined in Rule 16b-3(b)(3)(i) of the Exchange Act. 

 

            (b)        To the extent desirable to qualify transactions hereunder as exempt under Rule 16b-3 of the Exchange Act, the transactions contemplated hereunder will be structured to satisfy the requirements for exemption under Rule 16b-3 of the Exchange Act.

 

            (c)        The Committee shall have the power and authority, in its discretion:

 

(i)         to select the Service Providers to whom Awards may be granted hereunder;

 

(ii)        to determine whether and to what extent Options, Restricted Stock, or Restricted Stock Units are to be granted hereunder to Service Providers;

 

(iii)       to determine the number of Shares to be covered by each Award granted hereunder;

 

(iv)       to determine the terms and conditions, not inconsistent with the terms of the Plan, of any Award granted hereunder;

 

(v)        to determine the terms and conditions, not inconsistent with the terms of the Plan, which shall govern all written instruments evidencing Awards granted hereunder;

 

(vi)       to adopt, alter, and rescind rules and regulations relating to the Plan as it shall from time to time deem advisable; and

 

(vii)      to construe and interpret the terms of the Plan and Awards granted pursuant to the Plan (and any Award Agreement relating thereto), and to otherwise supervise the administration of the Plan.

 

In exercising such discretion pursuant to this Section 4(c), the Committee shall ensure that a grant of Options, Restricted Stock, or Restricted Stock Units is structured so as not to cause a deferral of compensation under Code §409A and the Regulations thereunder.

 

            (d)        The Committee’s decisions, determinations, and interpretations will be final, conclusive, and binding on all persons, including the Company and the Participants.  No member of the Committee, nor any officer or employee of the Company acting on behalf of the Committee, shall be personally liable for any action, determination, or interpretation taken or made in good faith with respect to the Plan, and all members of the Committee and each and any officer or employee of the Company acting on their behalf shall, to the extent permitted by law, be fully indemnified and protected by the Company in respect of any such action, determination, or interpretation. 

 

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Section 5.        Eligibility.

 

            The Participants under the Plan shall be selected from time to time by the Committee, in its sole discretion, from among Service Providers.  The Committee shall have the authority to grant to any Service Provider Options, Restricted Stock, or Restricted Stock Units, in accordance with the terms of the Plan.

 

Section 6.        Options.

 

            (a)        General .  Options may be granted alone or in addition to other Awards granted under the Plan.  Any Option granted under the Plan shall be evidenced by an Award Agreement.  The provisions of each Option need not be the same with respect to each Participant.  The Committee shall determine the Service Providers to whom, and the time or times at which, awards of Options shall be made, and the terms of such Options, not inconsistent with the terms of the Plan.  Participants who are granted Options shall enter into an Award Agreement with the Company, in such form as the Committee shall determine, which Award Agreement shall set forth, among other things, the exercise price of the Option, the term of the Option, and provisions regarding exercisability of the Option granted thereunder.  The Options granted under the Plan must be Nonqualified Stock Options.  More than one Option may be granted to the same Participant and be outstanding concurrently hereunder.  Options granted under the Plan shall be subject to the terms and conditions set forth in paragraphs (b) –(h) of this Section 6 and shall contain such additional terms and conditions, not inconsistent with the terms of the Plan, as the Committee shall deem desirable.

 

            (b)        Exercise Price .  The per share exercise price of Shares purchasable under an Option shall be determined by the Committee in its sole discretion at the time of the grant, but shall not be less than 100% of the Fair Market Value per Share as of the date of grant.

 

            (c)        Option Term .  The term of such Option shall be fixed by the Committee, but no Option shall be exercisable more than ten (10) years after the date such Option is granted. 

 

            (d)        Exercisability and Vesting .  Options shall be exercisable and vested at such time or times and subject to such terms and conditions as shall be determined by the Committee in its sole discretion.  Unless otherwise provided in an Award Agreement, Options shall vest and become exercisable at the rate of 20% of the Shares subject to the Option on the first anniversary of the date of grant, and as to an additional 20% of the Shares subject to the Option on each of the four succeeding anniversaries on the date of grant, but only to the extent that the Participant has continuously been a Service Provider through each such date.  In accordance with Code §409A, if the Committee selects an exercise and vesting schedule other than that set forth in this paragraph, such exercise and vesting schedule shall be fixed as of the date of the Option grant and shall not include any feature for the deferral of compensation other than deferral of recognition of income until the later of (i) the exercise or disposition of the Option under Treas. Reg. §1.83-7 or (ii) the time the stock acquired pursuant to the exercise of the Option first becomes substantially vested (as defined in Treas. Reg. §1.83-3(b).

 

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            (e)        Method of Exercise .  An Option may be exercised in whole or in part prior to the expiration of such Option by giving written notice of exercise to the Company specifying the number of Shares to be purchased, accompanied by full payment for the Shares with respect to which the Option is exercised (together with applicable withholding taxes).  Full payment may consist of any consideration and method of payment authorized by the Committee and permitted by the Award Agreement and the Plan. 

 

            (f)         Rights as a Stockholder.  Until the Shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a stockholder will exist with respect to the Shares subject to an Option, notwithstanding the exercise of the Option.  The Company will issue (or cause to be issued) certificate(s) evidencing such Shares promptly after the Option is exercised.

 

            (g)        Nontransferability of Options .  The Participant shall not be permitted to sell, transfer, pledge, or assign any Option other than by: (i) will or the laws of descent and distribution, or (ii) a qualified domestic relations order within the meaning of Section 414(p) of the Code or any similar instrument.  All Options shall be exercisable during the Participant’s lifetime only by the Participant. 

           

(h)         Termination of Relationship as a Service Provider

 

(1)               Termination other than for Death If a Participant ceases to be a Service Provider, other than upon the Participant’s termination as a Service Provider as a result of the Participant’s death, the Participant may exercise his or her Option within ninety (90) days of such termination of service to the extent such Option is vested on the date Participant ceases to be a Service Provider, but in no event later than the expiration of the term of such Option as set forth in the Award Agreement.  If on the date the Participant ceases to be a Service Provider the Participant is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option will revert to the Plan.  If, after Participant ceases to be a Service Provider, the Participant does not exercise his or her Option within the ninety (90) days described above, the Option will terminate, and the Shares covered by the Option will revert to the Plan.

 

(2)               Termination by Reason of Death .  If a Participant either (i) dies while a Service Provider, or (ii) dies within the ninety (90) day period following the date the Participant ceases to be a Service Provider as described in Section 6(h)(1) above, the Option may be exercised within twelve (12) months following the Participant’s death to the extent such Option is vested on the date of Participant’s death, but in no event later than the expiration of the term of such Option as set forth in the Award Agreement.  Such Option may be exercised by the personal representative of the Participant’s estate, or by the person(s) to whom the Option is transferred pursuant to the Participant’s will or in accordance with the laws of descent and distribution, provided that documentation satisfactory to the Committee establishing the right of such personal representative or heir to receive the Option from Participant is provided to the Committee.   If on the date the Participant dies the Participant is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option will revert to the Plan.  If, after Participant dies, the Participant’s Option is not exercised within the twelve (12) months described above, the Option will terminate, and the Shares covered by the Option will revert to the Plan.

 

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Section 7.  Restricted Stock.

 

            (a)        General .  Awards of Restricted Stock may be issued either alone or in addition to other Awards granted under the Plan and shall be evidenced by an Award Agreement.  The provisions of the awards of Restricted Stock need not be the same with respect to each Participant.  The Committee shall determine the Service Providers to whom, and the time or times at which, awards of Restricted Stock shall be made; the number of Shares to be awarded; the price, if any, to be paid by the Participant for the acquisition of the Restricted Stock, and the Restricted Period (as defined in Section 7(c)) applicable to awards of Restricted Stock. 

 

            (b)        Awards and Escrow .  The prospective recipient of an Award of Restricted Stock shall not have any rights with respect to any such Award, unless and until such recipient has executed an Award Agreement evidencing the Award and delivered a fully executed copy thereof to the Company, within such period as the Committee may specify after the award date.  Each Participant who is granted an Award of Restricted Stock shall be issued a share certificate in respect of such Shares of Restricted Stock, which certificate shall be registered in the name of the Participant and shall bear an appropriate legend referring to the terms, conditions, and restrictions applicable to any such Award; provided, however, that unless the Committee determines otherwise, (i) the Company as escrow agent will hold the share certificates for all Shares of Restricted Stock until the Restricted Period has ended and all restrictions on such Shares have lapsed, and (ii) as a condition of Award of Restricted Stock, the Participant shall have delivered a stock power, endorsed in blank, relating to the Shares covered by such Award.

 

            (c)        Nontransferability of Restricted Stock .  The Committee, in its sole discretion, shall determine in the terms of the Award Agreement and the period during which the Restricted Stock Award shall be subject to restrictions on transferability (the “Restricted Period”).  During the Restricted Period, the Participant shall not be permitted to sell, transfer, pledge, hypothecate, or assign Shares of Restricted Stock awarded under the Plan except by: (i) will or the laws of descent and distribution, or (ii) a qualified domestic relations order within the meaning of Section 414(p) of the Code or any similar instrument.  The Committee, in its sole discretion, may impose such other restrictions and conditions on Shares of Restricted Stock as it may deem advisable or appropriate, including the attainment of corporate or individual performance goals.   

 

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            (d)        Removal of Restrictions .  Unless otherwise provided in an Award Agreement, the Restricted Period shall end as to 25% of the total Shares of Restricted Stock granted in an Award on the first anniversary of the date of grant, and as to an additional 25% of the total Shares of Restricted Stock granted in an Award on each of the three succeeding anniversaries of the date of grant, but only to the extent that the Participant has continuously been a Service Provider through each such date.  Shares of Restricted Stock covered by Restricted Stock grants made under the Plan will be released from escrow on a rolling basis as Restricted Periods end, such Shares to be released as soon as practicable after the last day of the particular Restricted Period applicable to the Shares, or at such other time as the Committee may determine. 

 

            (e)        Rights as a Stockholder .  Except as provided in Sections 7(b) and (c) above or as otherwise provided in an Award Agreement, the Participant shall possess all incidents of ownership with respect to Shares of Restricted Stock during the Restricted Period, including the right to receive all dividends and distributions paid with respect to such Shares and to vote such Shares.  If any such dividends or distributions are paid in Shares, the Shares will be subject to the same restrictions on transferability and forfeitability as the Shares of Restricted Stock with respect to which they were paid. 

 

            (f)         Termination of Relationship as a Service Provider .  Except as otherwise provided in an Award Agreement, if a Participant ceases to be a Service Provider for any reason during the Restricted Period, the Participant’s rights to Shares of Restricted Stock for which restrictions have not lapsed will be forfeited back to the Company and the Participant shall have no further rights thereto.

 

Section 8.        Restricted Stock Units. 

 

            (a)        General .  Awards of Restricted Stock Units may be issued either alone or in addition to other Awards granted under the Plan and shall be evidenced by an Award Agreement.  The provisions of the awards of Restricted Stock Units need not be the same with respect to each Participant.  The Committee shall determine the Service Providers to whom, and the time or times at which, awards of Restricted Stock Units shall be made; the number of Restricted Stock Units to be awarded, and the vesting period (as described in Section 8(c)) applicable to awards of Restricted Stock Units.    

 

            (b)        Awards .  A Restricted Stock Unit Award shall be similar in nature to a Restricted Stock Award except that no Shares are actually issued to a Participant (or held in escrow for the benefit of Participant) until a later date specified in the applicable Award Agreement.  Each Restricted Stock Unit shall have a value equal to the Fair Market Value of a Share.

 

            (c)        Vesting .  The Committee, in its sole discretion, shall determine in the terms of the Award Agreement the vesting schedule and other restrictions and conditions to which the Restricted Stock Unit Award will be subject.  The Committee may set vesting criteria based upon the achievement of Company-wide, business unit, or individual goals (including, but not limited to, continued employment), or any other basis determined by the Committee in its discretion.  Provided that the conditions to the vesting of a Restricted Stock Unit are satisfied, and except as provided in Section 8(e) hereof, upon satisfaction of all vesting conditions with respect to a Restricted Stock Unit, such Restricted Stock Unit shall vest. 

 

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            (d)        Benefit Upon Vesting .  Upon the vesting of the Restricted Stock Units, the Participant shall be entitled to receive, as soon as practicable after the date on which such Restricted Stock Unit vests, an amount in cash, Shares, or a combination of the foregoing (as determined by the Committee in its sole discretion) equal, per unit, to the Fair Market Value of a Share on the date on which such Restricted Stock Unit vests.

 

            (e)        Termination of Relationship as a Service Provider .  Except as otherwise provided in an Award Agreement, if a Participant ceases to be a Service Provider for any reason before the Restricted Stock Units have vested, the Participant’s rights to unvested Restricted Stock Units shall be cancelled and the Participant shall have no further rights thereto.

 

Section 9.        Adjustments; Dissolution or Liquidation; Change in Control. 

 

            (a)        Adjustments.  In the event that any dividend or other distribution (whether in the form of cash, Shares, other securities, or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or exchange of Shares or other securities of the Company, or other change in the corporate structure of the Company affecting the Shares occurs, the  Committee, in order to prevent diminution or enlargement of the benefits or potential benefits intended to be made available under the Plan, will adjust the number and class of shares of stock that may be delivered under the Plan and/or the number, class, and price of shares of stock covered by each outstanding Award.

(b)        Dissolution or Liquidation . In the event of the proposed dissolution or liquidation of the Company, the Committee will use its reasonable efforts to notify each Participant as soon as practicable prior to the effective date of such proposed transaction. To the extent it has not been previously exercised, an Award will terminate immediately prior to the consummation of such proposed action.

(c)        Change in Control . In the event of a Change in Control, each outstanding Award will be treated as the Committee determines, including, without limitation, that each Award be assumed or an equivalent option or right substituted by the successor entity or a parent or affiliate of the successor entity. The Committee will not be required to treat all Awards similarly in the transaction. Unless otherwise provided in an Award Agreement, upon the occurrence of a Change in Control, all outstanding Shares of Restricted Stock and Restricted Stock Units granted to a Participant that have not theretofore vested shall immediately vest, and each Option granted to a Participant and outstanding at such time shall become fully and immediately vested and exercisable, unless such Awards are either assumed or an equitable substitution is made therefor. 

 

Section 10.      Tax Withholding.

 

(a)        Withholding Requirements . Prior to the delivery of any Shares or cash pursuant to an Award (or exercise thereof), the Company will have the power and the right to deduct or withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy federal, state, local, foreign or other taxes (including the Participant’s FICA obligation) required to be withheld with respect to such Award (or exercise thereof).

 

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(b)        Withholding Arrangements . The Committee, in its sole discretion and pursuant to such procedures as it may specify from time to time, may permit a Participant to satisfy such tax withholding obligation, in whole or in part by (without limitation): (i) paying cash, (ii) electing to have the Company withhold otherwise deliverable cash or Shares having a Fair Market Value equal to the minimum statutory amount required to be withheld, (iii) delivering to the Company already-owned Shares having a Fair Market Value equal to the minimum statutory amount required to be withheld, or (iv) any combination thereof.  The Fair Market Value of the Shares to be withheld or delivered will be determined as of the date that the taxes are required to be withheld.

 

Section 11.      No Effect on Employment or Service.

 

            Neither the Plan nor any Award will confer upon a Participant any right with respect to continuing the Participant’s relationship as a Service Provider with the Company or a Company’s direct or indirect subsidiary, nor will they interfere in any way with the Participant’s right or the Company’s right (or the right of a Company’s direct or indirect subsidiary) to terminate such relationship at any time, with or without cause, to the extent permitted by applicable laws.

 

Section 12.      Term of Plan; Amendment; Termination.

 

            The Plan will become effective upon its adoption by the Board, subject to the approval of the Company’s stockholders.  Unless terminated earlier pursuant to the terms of the Plan, the Plan will continue in effect for a period of ten (10) years from the effective date (the “Plan Term”).  No Award shall be granted pursuant to the Plan after the end of the Plan Term, but Awards theretofore granted may extend beyond the Plan Term.  The Board may at any time amend, alter, suspend or terminate the Plan.  The Company shall obtain stockholder approval of any Plan amendment, alteration, suspension, or termination to the extent necessary and desirable to comply with applicable laws.  No amendment, alteration, suspension, or termination of the Plan will impair the rights of any Participant, unless mutually agreed otherwise by the Participant and the Committee, which agreement must be in writing and signed by the Participant and the Committee.

 

Section 13.      General Provisions.

 

            (a)        Shares shall not be issued pursuant to the exercise of any Award granted hereunder unless the exercise of such Award and the issuance and delivery of such Shares pursuant thereto shall comply with all relevant provisions of law, including, without limitation, the Securities Act of 1933, as amended, the Exchange Act, and the requirements of any stock exchange upon which the Shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance. The Company shall be under no obligation to effect the registration pursuant to the Securities Act of 1933, as amended, of any interests in the Plan or any Shares to be issued hereunder or to effect similar compliance under any state laws.

        

 

10


 

 

            (b)        All certificates for Shares delivered under the Plan shall be subject to such stock-transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Shares may then be listed, and any applicable federal or state securities law, and the Committee may cause a legend or legends to be placed on any such certificates to make appropriate reference to such restrictions. The Committee may require, as a condition of the issuance and delivery of certificates evidencing Shares pursuant to the terms hereof, that the recipient of such Shares make such agreements and representations as the Committee, in its sole discretion, deems necessary or desirable.

                

            (c)        No fractional Shares shall be issued or delivered pursuant to the Plan. The Committee shall determine whether cash, other Awards, or other property shall be issued or paid in lieu of such fractional shares or whether such fractional shares or any rights thereto shall be forfeited or otherwise eliminated.

           

            (d)        If any provision of the Plan is held to be invalid or unenforceable, the other provisions of the Plan shall not be affected but shall be applied as if the invalid or unenforceable provision had not been included in the Plan.

           

            (e)        The Plan and all Awards shall be governed by the laws of the State of Delaware without regard to its principles of conflict of laws.

           

           

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

11

ALAMO GROUP INC.

 

2009 EQUITY INCENTIVE PLAN

RESTRICTED STOCK AWARD AGREEMENT

 

            THIS RESTRICTED STOCK AWARD AGREEMENT (the “Award Agreement”) is made and entered into as of ________________, 20___ (the “Date of Grant”), by and between Alamo Group Inc., a Delaware corporation (the “Company”), and __________________ (the “Grantee”).  Capitalized terms not defined herein shall have the meaning ascribed to them in the Company’s 2009 Equity Incentive Plan (the “Plan”). 

 

            1.         Notice of Restricted Stock Grant .  Pursuant to the Plan, the Committee has determined that the Grantee is to be granted Restricted Stock (the “Award”), subject to the terms and conditions set forth in the Plan and herein, and hereby grants such Restricted Stock. 

 

2.          Number of Shares of Restricted Stock .  The Award hereby entitles the Grantee to _______ Shares of Restricted Stock (the “Restricted Stock Shares”), with no purchase price to be payable by Grantee for such Restricted Stock Shares.

 

3.          Terms and Conditions of Award .  The Award shall be subject to the following terms, conditions, and restrictions: 

 

a.    Awards and Escrow .  Grantee shall be issued a share certificate for the Restricted Stock Shares, which certificate shall be registered in the name of Grantee and shall bear the legend described in Section 3(b) hereof; provided, however, that: (i) the Company as escrow agent shall hold the share certificate for Grantee’s Restricted Stock Shares until the Restricted Period described in Section 3(c) has ended and all restrictions on such Restricted Stock Shares have lapsed, and (ii) as a condition of receiving this Award, the Grantee shall have delivered a stock power in the form provided by the Company, endorsed in blank, relating to the Restricted Stock Shares.

 

b.  Certificate; Restrictive Legend .  The Grantee agrees that any certificate issued for the Restricted Stock Shares prior to the end of the Restricted Period and lapse of any restrictions relating thereto shall be inscribed with the following legend:

 

“THIS CERTIFICATE AND THE SHARES OF STOCK REPRESENTED HEREBY ARE SUBJECT TO THE TERMS AND CONDITIONS, INCLUDING FORFEITURE PROVISIONS AND RESTRICTIONS AGAINST TRANSFER (THE “RESTRICTIONS”), CONTAINED IN THE ALAMO GROUP INC. 2009 EQUITY INCENTIVE PLAN AND THE RESTRICTED STOCK AWARD AGREEMENT ENTERED INTO BETWEEN THE REGISTERED OWNER AND THE COMPANY.  ANY ATTEMPT TO DISPOSE OF THESE SHARES IN CONTRAVENTION OF THE RESTRICTIONS, INCLUDING BY WAY OF SALE, ASSIGNMENT, TRANSFER, PLEDGE, HYPOTHECATION, OR OTHERWISE, SHALL BE NULL AND VOID AND WITHOUT EFFECT.”

 

 


 

c.    Nontransferability of Restricted Stock Shares During Restricted Period .  The Restricted Stock Shares shall be subject to restrictions on transferability until such restrictions lapse pursuant to Section 3(d) hereof (the “Restricted Period”).  During the Restricted Period, the Restricted Stock Shares and any interest therein may not be sold, transferred, pledged, hypothecated, assigned, or otherwise disposed of except by: (i) will or the laws of descent and distribution, or (ii) a qualified domestic relations order within the meaning of Section 414(p) of the Code or any similar instrument.  Any attempt to dispose of any Restricted Stock in contravention of such restrictions shall be null and void and without effect.

 

d.    Removal of Restrictions .  Subject to Section 3(e) and 3(f) hereof, the Restricted Period shall end as to 25% of the total Restricted Stock Shares on the first anniversary of the Date of Grant, and as to an additional 25% of the total Restricted Stock Shares on each of the three succeeding anniversaries of the Date of Grant, provided that the Grantee has continuously been a Service Provider through each such date.  Provided that the Grantee shall have complied with his or her obligations under Section 5 hereof, the Company will release to the Grantee from escrow on a rolling basis as Restricted Periods end, stock certificates free of the restrictive legend described in Section 3(b) hereof, for those Restricted Stock Shares for which the particular Restricted Period applicable to the Restricted Stock Shares has ended, as soon as practicable after the last day of the particular Restricted Period applicable to the Restricted Stock Shares.

 

e.   Termination of Relationship as a Service Provider .  If the Grantee ceases to be a Service Provider for any reason during the Restricted Period, the Grantee’s rights to the Restricted Stock Shares for which restrictions have not lapsed will be forfeited back to the Company and the Grantee will have no further rights thereto.

 

f.     Change in Control.  In the event of a Change in Control, restrictions on all Restricted Stock Shares shall immediately lapse and the Restricted Period shall end, unless the Award is either assumed or equitable substitution is made therefor. 

 

g.    Rights as a Stockholder .  Except as provided in this Section 3, the Grantee shall possess all incidents of ownership with respect to the Restricted Stock Shares during the Restricted Period, including the right to receive all dividends and distributions paid with respect to such Restricted Stock Shares and to vote such Restricted Stock Shares.  If any such dividends or distributions are paid in Shares, the Shares will be subject to the same restrictions on transferability and forfeitability as the Restricted Stock Shares with respect to which they were paid.

 


 

 

4.          Adjustments .   This Award and all rights and obligations under this Award Agreement are subject to Section 9 of the Plan.

 

5.          Tax Withholding and Obligations

 

a.   Pursuant to Section 10 of the Plan, the Company has the right to require the Grantee to remit to the Company in cash an amount sufficient to satisfy any federal, local, state, foreign, or other tax withholding requirements related to the Award. With the approval of the Committee, the Grantee may satisfy the foregoing requirement by electing to have the Company withhold from delivery Shares or by delivering Shares, in each case, having a value equal to the aggregate required minimum tax withholding to be collected by the Company.  Such Shares shall be valued at their Fair Market Value on the date on which the amount of tax to be withheld is determined.  Fractional Share amounts shall be settled in cash.

 

b.   The Grantee shall notify the Company of any election made pursuant to Section 83(b) of the Code.

 

6.          Notices .  Whenever any notice is required or permitted hereunder, such notice shall be in writing and shall be given by personal delivery, facsimile, first class mail, certified or registered with return receipt requested.  Any notice required or permitted to be delivered hereunder shall be deemed to have been duly given on the date which it is personally delivered or, whether actually received or not, on the third business day after mailing or 24 hours after transmission by facsimile to the respective parties named below.  Either party may change such party’s address for notices by duly giving notice pursuant hereto.

 

            If to the Company:        Alamo Group Inc.

                                                Attn: ________________

                                                1627 East Walnut

                                                Seguin, Texas 78155

                                                Facsimile: (830) _________

 

            If to the Grantee:           ______________________

                                                ______________________

                                                ______________________

                                                Facsimile: ______________

 

7.          Agreement Not a Contract of Employment .  Neither the Plan, the granting of the Award, the Award Agreement, nor any other action taken pursuant to the Plan shall constitute or be evidence of any agreement or understanding, express or implied, that the Grantee has a right to continue to be employed by, or to provide services as a Service Provider  to the Company or a Company’s direct or indirect subsidiary. 

 

 


 

8.          Compliance with Laws .

 

a.   Shares shall not be issued pursuant to the Award granted hereunder unless the issuance and delivery of such Shares pursuant thereto shall comply with all relevant provisions of law, including, without limitation, the Securities Act of 1933, as amended, the Exchange Act, and the requirements of any stock exchange upon which the Shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance. The Company shall be under no obligation to effect the registration pursuant to the Securities Act of 1933, as amended, of any interests in the Plan or any Shares to be issued hereunder or to effect similar compliance under any state laws.

        

b.   All certificates for Shares delivered under the Plan shall be subject to such stock-transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Shares may then be listed, and any applicable federal or state securities law, and the Committee may cause a legend or legends to be placed on any such certificates to make appropriate reference to such restrictions. The Committee may require, as a condition of the issuance and delivery of certificates evidencing Shares pursuant to the terms hereof, that the recipient of such Shares make such agreements and representations as the Committee, in its sole discretion, deems necessary or desirable.

 

9.          Protections Against Violations of Agreement .  No purported sale, assignment, mortgage, hypothecation, transfer, pledge, encumbrance, gift, transfer in trust (voting or other) or other disposition of, or creation of a security interest in or lien on, any of the Restricted Stock Shares by any holder thereof in violation of the provisions of this Award Agreement or the Certificate of Incorporation or the Bylaws of the Company, will be valid, and the Company will not transfer any such Restricted Stock Shares on its books nor will any of such Restricted Stock Shares be entitled to vote, nor will any dividends be paid thereon, unless and until there has been full compliance with such provisions to the satisfaction of the Company.  The foregoing restrictions are in addition to and not in lieu of any other remedies, legal or equitable, available to enforce said provisions.

 

10.        Failure to Enforce Not a Waiver .  The failure of the Company to enforce at any time any provision of the Award Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof.

 

11.        Governing Law .  The Award Agreement shall be governed by the laws of the State of Delaware without regard to its principles of conflict of laws.

 

12.        Incorporation of the Plan .  The Plan, as it exists on the date of the Award Agreement and as amended from time to time, is hereby incorporated by reference and made a part hereof, and the Award and this Award Agreement shall be subject to all terms and conditions of the Plan.  In the event of any conflict between the provisions of the Award Agreement and the provisions of the Plan, the terms of the Plan shall control, except as expressly stated otherwise.

 

 


 

13.         Amendments .  This Award Agreement may be amended or modified at any time, but only by an instrument in writing signed by each of the parties hereto.

 

14.       Authority of Committee .  The Committee shall have full authority to interpret and construe the terms of the Plan and the Award Agreement.  The determination by the Committee as to any such matter of interpretation or construction shall be final, binding, and conclusive.

 

15.        Binding Effect .   The Award Agreement shall apply to and bind the Grantee and the Company and their respective permitted assignees or transferees, heirs, legatees, executors, administrators, and legal successors. 

 

16.        Tax Representation .  The Grantee hereby represents that he or she has reviewed with his or her own tax advisors the federal, state, local, and foreign tax consequences of the transactions contemplated by this Award Agreement.  The Grantee is relying solely on such advisors and not on any statements or representations of the Company or any of its agents.  The Grantee understand that he or she (and not the Company) shall be responsible for any tax liability that may arise as a result of the transactions contemplated by the Award Agreement

 

17.        Acceptance .  The Grantee hereby acknowledges receipt of a copy of the Plan and this Award Agreement.  Grantee has read and understands the terms and provisions thereof, and accepts the Award subject to all terms and conditions of the Plan and the Award Agreement.

 


[ Signatures to Follow on Next Page. ]

 



            IN WITNESS WHEREOF, the parties hereto have executed and delivered this Award Agreement on the day and year first written above.

 

                                                                        COMPANY :

 

                                                                        ALAMO GROUP INC.

 

                                                                        By: ______________________________________

                                                                                    ________________, its ________________

                                               

 

                                                                        GRANTEE :

 

 

                                                                        Signature: _________________________________

                                                                        Name: ____________________________________

                                                                        Address: __________________________________

                                                                        __________________________________________

                                                                        Telephone No.: _____________________________

                                                                        Social Security No.: _________________________

 

                                                                       

 

 

 

 

 

ALAMO GROUP INC.

 

2009 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

 

            THIS RESTRICTED STOCK UNIT AWARD AGREEMENT (the “Award Agreement”) is made and entered into as of ________________, 20___ (the “Date of Grant”), by and between Alamo Group Inc., a Delaware corporation (the “Company”), and __________________ (the “Grantee”).  Capitalized terms not defined herein shall have the meaning ascribed to them in the Company’s 2009 Equity Incentive Plan (the “Plan”). 

 

            1.         Notice of Restricted Stock Unit Grant .  Pursuant to the Plan, the Committee has determined that the Grantee is to be granted Restricted Stock Units (the “Award”), subject to the terms and conditions set forth in the Plan and herein, and hereby grants such Restricted Stock Units. 

 

2.          Number of Restricted Stock Units .  The Award hereby entitles the Grantee to _______ Restricted Stock Units (the “Restricted Stock Units”), with no purchase price to be payable by Grantee for such Restricted Stock Units.

 

3.          Terms and Conditions of Award .  The Award shall be subject to the following terms, conditions, and restrictions: 

 

a.    Awards.  Grantee shall not be issued a share certificate for the Restricted Stock Units or receive compensation therefor unless and until such Restricted Stock Units have vested in accordance with Section 3(b) hereof. 

 

b.  Vesting.    Subject to Section 3(c) and 3(d) hereof, the Grantee shall vest as to 25% of the total Restricted Stock Units on the first anniversary of the Date of Grant, and as to an additional 25% of the total Restricted Stock Units on each of the three succeeding anniversaries of the Date of Grant, provided that the Grantee has continuously been a Service Provider through each such date.  Provided that the Grantee shall have complied with his or her obligations under Section 5 hereof, the Company will, as soon as practicable after the date on which such Restricted Stock Units vest, issue to the Grantee an amount of cash, stock certificates for Shares, or a combination of the foregoing (as determined by the Committee in its sole discretion) equal, per unit, to the Fair Market Value of a Share on the date on which such Restricted Stock Unit vests.    

 

c.    Termination of Relationship as a Service Provider .  If the Grantee ceases to be a Service Provider for any reason before the Restricted Stock Units have vested, the Grantee’s rights to the unvested Restricted Stock Units shall be cancelled and the Grantee shall have no further rights thereto.   

 


 

 

d.  Change in Control.  In the event of a Change in Control, all Restricted Stock Units shall immediately vest, unless the Award is either assumed or equitable substitution is made therefor. 

 

e.    No Ownership or Rights as a Stockholder .  The Grantee shall not possess any incidents of ownership with respect to the Restricted Stock Units (and therefor the Grantee may not transfer such Restricted Stock Units) unless and until: (i) such Restricted Stock Units have vested pursuant to Section 3(b) hereof, and (ii) the Company has issued to the Grantee cash, Shares, or a combination thereof with respect to the Restricted Stock Units.  The Grantee shall not possess any rights as a stockholder, shall not have the right to receive any dividends or distributions with respect to such Restricted Stock Units, and shall have no right to vote such Restricted Stock Units, unless and until: (i)  such Restricted Stock Units have vested pursuant to Section 3(b) hereof, and (ii) the Company has issued to Grantee Shares at the Company’s election, rather than cash, with respect to any of the Restricted Stock Units pursuant to Section 3(b) hereof.     

 

4.          Adjustments .   This Award and all rights and obligations under this Award Agreement are subject to Section 9 of the Plan.

 

5.          Tax Withholding and Obligations .  Pursuant to Section 10 of the Plan, the Company has the right to require the Grantee to remit to the Company in cash an amount sufficient to satisfy any federal, local, state, foreign, or other tax withholding requirements related to the Award. With the approval of the Committee, the Grantee may satisfy the foregoing requirement by electing to have the Company withhold from delivery Shares or by delivering Shares, in each case, having a value equal to the aggregate required minimum tax withholding to be collected by the Company.  Such Shares shall be valued at their Fair Market Value on the date on which the amount of tax to be withheld is determined.  Fractional Share amounts shall be settled in cash.

 

6.           Notices .  Whenever any notice is required or permitted hereunder, such notice shall be in writing and shall be given by personal delivery, facsimile, first class mail, certified or registered with return receipt requested.  Any notice required or permitted to be delivered hereunder shall be deemed to have been duly given on the date which it is personally delivered or, whether actually received or not, on the third business day after mailing or 24 hours after transmission by facsimile to the respective parties named below.  Either party may change such party’s address for notices by duly giving notice pursuant hereto.

 

            If to the Company:        Alamo Group Inc.

                                                Attn: ________________

                                                1627 East Walnut

                                                Seguin, Texas 78155

                                                Facsimile: (830) _________

 

 


 

 

            If to the Grantee:           ______________________

                                                ______________________

                                                ______________________

                                                Facsimile: ______________

 

7.          Agreement Not a Contract of Employment .  Neither the Plan, the granting of the Award, the Award Agreement, nor any other action taken pursuant to the Plan shall constitute or be evidence of any agreement or understanding, express or implied, that the Grantee has a right to continue to be employed by, or to provide services as a Service Provider  to the Company or a Company’s direct or indirect subsidiary. 

 

8.          Compliance with Laws .

 

a.   Shares shall not be issued pursuant to the Award granted hereunder unless the issuance and delivery of such Shares pursuant thereto shall comply with all relevant provisions of law, including, without limitation, the Securities Act of 1933, as amended, the Exchange Act, and the requirements of any stock exchange upon which the Shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance. The Company shall be under no obligation to effect the registration pursuant to the Securities Act of 1933, as amended, of any interests in the Plan or any Shares to be issued hereunder or to effect similar compliance under any state laws.

        

b.   All certificates for Shares delivered under the Plan shall be subject to such stock-transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Shares may then be listed, and any applicable federal or state securities law, and the Committee may cause a legend or legends to be placed on any such certificates to make appropriate reference to such restrictions. The Committee may require, as a condition of the issuance and delivery of certificates evidencing Shares pursuant to the terms hereof, that the recipient of such Shares make such agreements and representations as the Committee, in its sole discretion, deems necessary or desirable.

 

9.          Protections Against Violations of Agreement .  No purported sale, assignment, mortgage, hypothecation, transfer, pledge, encumbrance, gift, transfer in trust (voting or other) or other disposition of, or creation of a security interest in or lien on, any of the Restricted Stock Units by any holder thereof in violation of the provisions of this Award Agreement or the Certificate of Incorporation or the Bylaws of the Company, will be valid, and the Company will not transfer any such Restricted Stock Units on its books nor will any of such Restricted Stock Units be entitled to vote, nor will any dividends be paid thereon, unless and until there has been full compliance with such provisions to the satisfaction of the Company.  The foregoing restrictions are in addition to and not in lieu of any other remedies, legal or equitable, available to enforce said provisions.

 

 


 

10.         Failure to Enforce Not a Waiver .  The failure of the Company to enforce at any time any provision of the Award Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof.

 

11.        Governing Law .  The Award Agreement shall be governed by the laws of the State of Delaware without regard to its principles of conflict of laws.

 

12.         Incorporation of the Plan .  The Plan, as it exists on the date of the Award Agreement and as amended from time to time, is hereby incorporated by reference and made a part hereof, and the Award and this Award Agreement shall be subject to all terms and conditions of the Plan.  In the event of any conflict between the provisions of the Award Agreement and the provisions of the Plan, the terms of the Plan shall control, except as expressly stated otherwise.

 

13.        Amendments .  This Award Agreement may be amended or modified at any time, but only by an instrument in writing signed by each of the parties hereto.

 

14.       Authority of Committee .  The Committee shall have full authority to interpret and construe the terms of the Plan and the Award Agreement.  The determination by the Committee as to any such matter of interpretation or construction shall be final, binding, and conclusive.

 

15.        Binding Effect .   The Award Agreement shall apply to and bind the Grantee and the Company and their respective permitted assignees or transferees, heirs, legatees, executors, administrators, and legal successors. 

 

16.         Tax Representation .  The Grantee hereby represents that he or she has reviewed with his or her own tax advisors the federal, state, local, and foreign tax consequences of the transactions contemplated by this Award Agreement.  The Grantee is relying solely on such advisors and not on any statements or representations of the Company or any of its agents.  The Grantee understand that he or she (and not the Company) shall be responsible for any tax liability that may arise as a result of the transactions contemplated by the Award Agreement

 

17.        Acceptance .  The Grantee hereby acknowledges receipt of a copy of the Plan and this Award Agreement.  Grantee has read and understands the terms and provisions thereof, and accepts the Award subject to all terms and conditions of the Plan and the Award Agreement.

 


[ Signatures to Follow on Next Page. ]

 



            IN WITNESS WHEREOF, the parties hereto have executed and delivered this Award Agreement on the day and year first written above.

 

                                                                        COMPANY :

 

                                                                        ALAMO GROUP INC.

 

                                                                        By: ______________________________________

                                                                                    ________________, its ________________

                                               

 

                                                                        GRANTEE :

 

 

                                                                        Signature: _________________________________

                                                                        Name: ____________________________________

                                                                        Address: __________________________________

                                                                        __________________________________________

                                                                        Telephone No.: _____________________________

                                                                        Social Security No.: _________________________

 

                                                                       

 

 

 

 

 

 

ALAMO GROUP INC.

 

2009 EQUITY INCENTIVE PLAN

NONQUALIFIED STOCK OPTION AGREEMENT

 

            THIS OPTION AGREEMENT (the “Option Agreement”) is made and entered into as of ________________, 20___ (the “Date of Grant”), by and between Alamo Group Inc., a Delaware corporation (the “Company”), and __________________ (the “Optionee”).  Capitalized terms not defined herein shall have the meaning ascribed to them in the Company’s 2009 Equity Incentive Plan (the “Plan”). 

 

            1.         Notice of Stock Option Grant .  Pursuant to the Plan, the Committee has determined that the Optionee is to be granted a nonqualified stock option (the “Option”) to purchase Shares, subject to the terms and conditions set forth in the Plan and herein, and hereby grants such Option. 

 

2.           Number of Shares and Exercise Price .  The Option hereby entitles the Optionee to purchase ____ Shares (the “Option Shares”) at a price of $_______ per Share (the “Option Exercise Price.”). 

 

3.          Option Term .  The term of the Option and of the Option Agreement (the “Option Term”) shall commence on the Date of Grant and, unless the Option is previously terminated pursuant to Section 6 hereof, shall terminate upon the expiration of ten (10) years from the Date of Grant (the “Expiration Date”).  As of the Expiration Date, all rights of the Optionee hereunder shall terminate.

 

4.          Conditions of Exercise

 

a.   Subject to Sections 6 and 7(b) hereof, the Option shall become vested and exercisable as to 20% of the Option Shares on the first anniversary of the Date of Grant, and as to an additional 20% of the Option Shares on each of the four succeeding anniversaries of the Date of Grant, provided that the Optionee has continuously been a Service Provider through each such date.

 

b.   Except as otherwise provided herein, the right of the Optionee to purchase Option Shares with respect to which the Option has become exercisable and vested may be exercised in whole or in part at any time or from time to time prior to the Expiration Date; provided, however, that the Option may not be exercised for a fraction of a Share.

 

5.          Method of Exercise .  This Option may be exercised, in whole or in part, by delivery of a written notice of exercise to the Company in such form as may be approved by the Committee from time to time and which may be obtained from the Company’s Administrative department, accompanied by payment in full of the aggregate Option Exercise Price for the exercised Option Shares, together with applicable withholding taxes, in the form of: (i) cash, (ii)  to the extent permitted by applicable law, by means of any cash or cashless exercise procedure through the use of a brokerage arrangement approved by the Committee, (iii) electing to remit unrestricted Shares already owned by the Optionee to the extent the unrestricted Shares have a Fair Market Value on the date of exercise equal to the aggregate Option Exercise Price of the exercised Option Shares, together with applicable withholding taxes, or (iv) any combination of the foregoing.  

 

 


 

 

6.          Effect of Termination of Relationship as a Service Provider

 

a.    Termination other than for Death If the Optionee ceases to be a Service Provider, other than upon the Optionee’s termination as a Service Provider as a result of the Optionee’s death, the Optionee may exercise this Option within ninety (90) days of such termination of service to the extent this Option is vested on the date the Optionee ceases to be a Service Provider, but in no event later than the expiration of the term set forth in Section 3 hereof.  If on the date the Optionee ceases to be a Service Provider the Optionee is not vested as to this entire Option, the Shares covered by the unvested portion of this Option will revert to the Plan.  If, after the Optionee ceases to be a Service Provider, the Optionee does not exercise this Option within the ninety (90) days described above, the Option will terminate, and the Shares covered by this Option will revert to the Plan.

 

b.    Termination by Reason of Death .  If the Optionee either (i) dies while a Service Provider, or (ii) dies within the ninety (90) day period following the date the Optionee ceases to be a Service Provider as described in Section 6(a) hereof, this Option may be exercised within twelve (12) months following the Optionee’s death to the extent this Option is vested on the date of the Optionee’s death, but in no event later than the expiration of the term set forth in Section 3 hereof.  Such Option may be exercised by the personal representative of the Optionee’s estate, or by the person(s) to whom the Option is transferred pursuant to the Optionee’s will or in accordance with the laws of descent and distribution, provided that documentation satisfactory to the Committee establishing the right of such personal representative or heir to receive the Option from Optionee is provided to the Committee.   If on the date the Optionee dies the Optionee is not vested as this entire Option, the Shares covered by the unvested portion of this Option will revert to the Plan.  If, after the Optionee dies, this Option is not exercised within the twelve (12) months described above, this Option will terminate, and the Shares covered by this Option will revert to the Plan.

 

7.          Adjustments; Change in Control

 

a.   Adjustments .  This Option and all rights and obligations under this Option Agreement are subject to Section 9 of the Plan.

b.   Change in Control . In the event of a Change in Control, any portion of the Option that is outstanding at such time shall become fully and immediately vested and exercisable, unless the Option is either assumed or an equitable substitution is made therefor.    

 

 

 


 

 

8.          Rights as a Stockholder .  Neither the Optionee nor any of the Optionee’s successors in interest shall have any rights as a stockholder of the Company with respect to any Option Shares until the Optionee has given written notice of exercise, has paid in full for such shares, and has satisfied the requirements in Section 10 and Section 13 of this Option Agreement.    

 

9.         Nontransferability of Option .  The Optionee may not sell, sell, transfer, pledge, or assign this Option other than by: (i) will or the laws of descent and distribution, or (ii) a qualified domestic relations order within the meaning of Section 414(p) of the Code or any similar instrument.  This Option shall be exercisable during the Optionee’s lifetime only by the Optionee.  Any attempted sale, transfer, pledge, assignment or other disposition of this Option contrary to the provisions hereof shall be null and void and without effect.     

 

10.        Tax Withholding and Obligations

 

a.   Pursuant to Section 10 of the Plan, the Company has the right to require the Optionee to remit to the Company in cash an amount sufficient to satisfy any federal, local, state, foreign, or other tax withholding requirements related to the exercise of the Option.  With the approval of the Committee, the Optionee may satisfy the foregoing requirement by electing to have the Company withhold from delivery Shares or by delivering Shares, in each case, having a value equal to the aggregate required minimum tax withholding to be collected by the Company.  Such Shares shall be valued at their Fair Market Value on the date on which the amount of tax to be withheld is determined.  Fractional Share amounts shall be settled in cash.

 

b.   The Optionee shall promptly notify the Company of any election made pursuant to Section 83(b) of the Code.

 

11.        Notices .  Whenever any notice is required or permitted hereunder, such notice shall be in writing and shall be given by personal delivery, facsimile, first class mail, certified or registered with return receipt requested.  Any notice required or permitted to be delivered hereunder shall be deemed to have been duly given on the date which it is personally delivered or, whether actually received or not, on the third business day after mailing or 24 hours after transmission by facsimile to the respective parties named below.  Either party may change such party’s address for notices by duly giving notice pursuant hereto.

 

            If to the Company:        Alamo Group Inc.

                                                Attn: ________________

                                                1627 East Walnut

                                                Seguin, Texas 78155

                                                Facsimile: (830) _________

 


 

 

            If to the Optionee:         ______________________

                                                ______________________

                                                ______________________

                                                Facsimile: ______________

 

12.        Agreement Not a Contract of Employment .  Neither the Plan, the granting of the Option, the Option Agreement, nor any other action taken pursuant to the Plan shall constitute or be evidence of any agreement or understanding, express or implied, that the Optionee has a right to continue to be employed by, or to provide services as a Service Provider  to the Company or a Company’s direct or indirect subsidiary. 

 

13.        Compliance with Laws .

 

a.   Shares shall not be issued pursuant to the exercise of the Option granted hereunder unless the exercise of such Option and the issuance and delivery of such Shares pursuant thereto shall comply with all relevant provisions of law, including, without limitation, the Securities Act of 1933, as amended, the Exchange Act, and the requirements of any stock exchange upon which the Shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance. The Company shall be under no obligation to effect the registration pursuant to the Securities Act of 1933, as amended, of any interests in the Plan or any Shares to be issued hereunder or to effect similar compliance under any state laws.

        

b.   All certificates for Shares delivered under the Plan shall be subject to such stock-transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Shares may then be listed, and any applicable federal or state securities law, and the Committee may cause a legend or legends to be placed on any such certificates to make appropriate reference to such restrictions. The Committee may require, as a condition of the issuance and delivery of certificates evidencing Shares pursuant to the terms hereof, that the recipient of such Shares make such agreements and representations as the Committee, in its sole discretion, deems necessary or desirable.

 

14.        Protections Against Violations of Agreement .  No purported sale, assignment, mortgage, hypothecation, transfer, pledge, encumbrance, gift, transfer in trust (voting or other) or other disposition of, or creation of a security interest in or lien on, any of the Option Shares by any holder thereof in violation of the provisions of this Option Agreement or the Certificate of Incorporation or the Bylaws of the Company, will be valid, and the Company will not transfer any such Option Shares on its books nor will any of such Option Shares be entitled to vote, nor will any dividends be paid thereon, unless and until there has been full compliance with such provisions to the satisfaction of the Company.  The foregoing restrictions are in addition to and not in lieu of any other remedies, legal or equitable, available to enforce said provisions.

 

 


 

15.       Failure to Enforce Not a Waiver .  The failure of the Company to enforce at any time any provision of the Option Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof.

 

16.        Governing Law .  The Option Agreement shall be governed by the laws of the State of Delaware without regard to its principles of conflict of laws.

 

17.        Incorporation of the Plan .  The Plan, as it exists on the date of the Option Agreement and as amended from time to time, is hereby incorporated by reference and made a part hereof, and the Option and this Option Agreement shall be subject to all terms and conditions of the Plan.  In the event of any conflict between the provisions of the Option Agreement and the provisions of the Plan, the terms of the Plan shall control, except as expressly stated otherwise.

 

18.         Amendments .  This Option Agreement may be amended or modified at any time, but only by an instrument in writing signed by each of the parties hereto.

 

19.        Authority of Committee .  The Committee shall have full authority to interpret and construe the terms of the Plan and the Option Agreement.  The determination by the Committee as to any such matter of interpretation or construction shall be final, binding, and conclusive.

 

20.           Binding Effect .   The Option Agreement shall apply to and bind the Optionee and the Company and their respective permitted assignees or transferees, heirs, legatees, executors, administrators, and legal successors. 

 

21.           Tax Representation .  The Optionee hereby represents that he or she has reviewed with his or her own tax advisors the federal, state, local, and foreign tax consequences of the transactions contemplated by this Option Agreement.  The Optionee is relying solely on such advisors and not on any statements or representations of the Company or any of its agents.  The Optionee understand that he or she (and not the Company) shall be responsible for any tax liability that may arise as a result of the transactions contemplated by the Option Agreement

 

22.            Acceptance .  The Optionee hereby acknowledges receipt of a copy of the Plan and this Option Agreement.  Optionee has read and understands the terms and provisions thereof, and accepts the Option subject to all terms and conditions of the Plan and the Option Agreement.

 


[ Signatures to Follow on Next Page. ]

 



            IN WITNESS WHEREOF, the parties hereto have executed and delivered this Option Agreement on the day and year first written above.

 

                                                                        COMPANY :

 

                                                                        ALAMO GROUP INC.

 

                                                                        By: ______________________________________

                                                                                    ________________, its ________________

                                               

 

                                                                        OPTIONEE :

 

 

                                                                        Signature: _________________________________

                                                                        Name: ____________________________________

                                                                        Address: __________________________________

                                                                        __________________________________________

                                                                        Telephone No.: _____________________________

                                                                        Social Security No.: _________________________

 

                                                                       

 

 

 

 

 

 

 

 

 

 

ALAMO GROUP INC.

Stock Option

 

            KNOW ALL MEN BY THESE PRESENTS:   That ALAMO GROUP INC. (the “Company”) having adopted a First Amended and Restated 1999 Non-Qualified Stock Option Plan (the “Plan”), hereby grants to ___________________ (the “Optionee”) the right and option to purchase ________________ shares of the Common Stock of the Company on the following terms and conditions:

 

1.          Exercise of Option .  This option shall become exercisable as follows.  After the expiration of one year following the date on which this option is granted, this option may be exercised as to up to twenty percent (20%) of the total number of shares covered hereby.  An additional twenty percent (20%) of the shares subject to this option shall become exercisable on each anniversary date of the grant hereof until all of the shares subject hereto have become exercisable.  Further, subject to the terms of paragraph 6, all of the shares covered hereby shall vest upon a Qualifying Event (as herein defined).  “Qualifying Event” means such date as Optionee is (i) age 62 or older, and (ii) has been employed by the Company or any of its affiliates for at least five (5) years.  (For purposes of this paragraph 1, Optionee shall be credited with time and service with any predecessor of such affiliate, if the predecessor or substantially all of its business was acquired by the Company or its affiliate.) 

 

                        The option shall be exercised by the Optionee as to all or part of the shares covered hereby, by the giving of written notice of such exercise to the Company at its principal business office, specifying the number of shares to be purchased, and specifying a business day, (the “exercise date”) not more than five (5) days from the date such notice is given, for the payment of the purchase price against delivery of the shares being purchased.  The giving of such written notice to the Company shall constitute an irrevocable election to purchase the number of shares specified in the notice and to exercise the right on the date specified in the notice.

 

2.          Option Price .  The purchase price of the shares which may be purchased pursuant to the option granted herein shall be $______ per share.

 

3.          Rights of Optionee .  Neither the Optionee nor his executors or administrators shall have any of the rights of a stockholder of the Company with respect to the shares subject to this option until a certificate or certificates for such shares shall have been issued upon the exercise of this option.

 

4.          Nontransferability of Option .  The option granted herein shall not be transferable by the Optionee other than to his executors or administrators by will or the laws of descent and distribution or pursuant to a qualified domestic relations order as defined by the Internal Revenue Code of 1986, as amended, or Title I of the Employer Retirement Income Security Act, or the rules thereunder.  During the Optionee's lifetime, this option shall be exercisable only by Optionee.

 

 

 

 


 


 

 

 

 

5.          Adjustments to Option Upon Change in Control, Changes in Capitalization, Etc .  In the event of any stock split, stock dividend, reclassification, or capitalization which changes the character or amount of the Company's outstanding Common Stock while any portion of this option is outstanding but unexercised, the Committee appointed under the Plan shall make such adjustments in the character and number of shares subject to such unexercised portion of this option, and in the option price, as shall be equitable and appropriate in order to make the option, as nearly as may be practicable, equivalent to this option immediately prior to such change; provided that no adjustment shall give the Optionee any additional benefits under this option.  In no event shall any key employee receiving stock options under this Plan receive options for more than 400,000 shares of the Company’s Common Stock during the period of the Plan set forth in paragraph 7 below. 

 

                        If the Company participates in any transaction resulting in a corporate merger, consolidation, acquisition of property or stock, separation, reorganization or liquidation, the Committee appointed under the Plan or the Board of Directors of the Company or any surviving or acquiring corporation: (i) shall take such action as is equitable and appropriate to substitute a new option for this option, or to assume this option, in order to make the new option, as nearly as may be practicable, equivalent to this option, or (ii) shall require that the option be exercised.  Notwithstanding the foregoing, upon the occurrence of a change of control of the Company as provided in paragraph 13(a) of the Plan, the terms of paragraph 13 of the Plan shall apply to this Option. 

 

6.          Termination of Option .  The unexercised portion of the option granted herein shall automatically and without notice terminate and become null and void at the time of the earliest of the following to occur:

 

(a)        the expiration of ten (10) years from the date on which this option is granted;

 

(b)        the expiration of six (6) months after the issuance of letters testamentary or letters of administration to the executor or administrator of the Optionee if the Optionee's death occurs either during his employment with the Company or during the 30-day period following the date of termination of such employment with the Company, but not later than one year after the Optionee's death;

 

(c)        the expiration of thirty (30) days from the date of the termination of the Optionee's employment with the Company; provided, however, that in the event of the termination of the Optionee's employment with the Company for cause, this option shall automatically terminate.  The term “cause” shall be defined as including, but shall not be limited to, the following: (a)  the Optionee's commission of an act of fraud, misappropriation, embezzlement or the like; or (b) in the event the Optionee is indicted or convicted of a felony;

 

(d)        the occurrence of the event or the expiration of the period set forth in Annex 1 hereto. 

 

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In the event of the Optionee's death during his employment with the Company or during the 30-day period following the date of termination of such employment with the Company pursuant to paragraph 6(b), this option shall thereafter be exercisable, as provided in paragraph 6(b), only by his executors or administrators.

 

                        The Company shall cause certificates for any shares to be delivered to the Optionee or his executors or administrators at its principal business office within ten (10) business days after the exercise date.

 

7.          Securities Laws Representations and Restrictions .  The Optionee, by his acceptance hereof, represents and warrants to the Company that his purchase of shares of Common Stock upon the exercise hereof shall be for investment and not with a view to distribution, provided that this representation and warranty shall be inoperative if, in the opinion of counsel to the Company, a proposed sale or distribution of such shares is pursuant to an applicable effective registration statement under the Securities Act of 1933 or without such representation and warranty is exempt from registration under such Act.

 

                        The Optionee agrees that the obligation of the Company to issue shares upon the exercise of an option shall also be subject as conditions precedent to compliance with applicable provisions of the Securities Act of 1933, the Securities Exchange Act of 1934, state securities laws, rules and regulations under any of the foregoing and applicable requirements of any securities exchange upon which the Company's securities shall be listed.

 

                        The Company may endorse an appropriate legend referring to the foregoing restriction upon the certificate or certificates representing any shares issued or transferred to the Optionee upon the exercise of this option.

 

8.          Employment with the Company .  As used herein, the term “employment with the Company” shall include employment with the Company or with any of its direct and indirect subsidiaries or serving as a director of the Company or with any of its direct or indirect subsidiaries.

 

            IN WITNESS WHEREOF, the Company has caused these presents to be signed by its officer duly authorized thereto this _____ day of ________________, _____.

 

                                                                       

 

ALAMO GROUP INC.

 

 

 

By: __________________________________

 

 

 

_____________________, President

ATTEST:

 

 

 

_________________________

 

            Secretary

 

 

ACCEPTED AND AGREED TO:

 

 

 

________________________________

 

                  OPTIONEE

                                                                                              

 

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Annex 1: 

 

            Additional Conditions.

 

 

 

 

 

 

 

 

 

4


 

 

ALAMO GROUP INC.

 

STOCK OPTION AWARD AGREEMENT

 

This Stock Option Award Agreement (the “Agreement”) is made between Alamo Group Inc., a Delaware corporation (the “Company”), and __________________________ (the “Optionee”), pursuant to the Company’s 2005 Incentive Stock Option Plan (the “Plan”), incorporated by reference herein.  All capitalized terms used but not defined herein shall have the meaning assigned to them in the Plan.  To the extent there are any inconsistencies between the terms of this option and the Plan; the terms of the Plan shall control.  The Company and the Optionee agree as follows: 

 

1.         The Company hereby grants to the Optionee and the Optionee accepts on the terms and conditions of this Agreement the right and the option to purchase all or any part of shares of Common Stock (the “Option”) described as:

 

Number of Shares of Common Stock

____________

Grant Price per Share

$___________

Grant Date

 _______, 20__ 

 

2.         The Option granted herein shall be exercisable according to the following schedule:  twenty percent (20%) of the shares of Stock shall vest on the first anniversary of the Grant Date and an additional twenty percent (20%) of the shares of Stock shall vest on each succeeding anniversary date of the Grant Date until all shares of Stock are vested.

 

3.         The unexercised portion of any Option shall automatically and without notice terminate and become null and void at the time the earliest of the following occurs:

 

(a)       The expiration of ten (10) years from the Grant Date; provided, however, that any Option granted to an individual owning, at the time the Option is granted, more than ten percent (10%) of the total combined voting power of all classes of stock of the Company and any of its subsidiaries, shall expire five (5) years from the Grant Date;

 

(b)       The expiration of thirty (30) days from the date of termination of the Optionee’s employment with the Company or any Affiliate either voluntarily by the Optionee or by the Company without cause; provided that if the Optionee shall die during such thirty (30) day period, the provisions of subparagraph (c) below shall apply;

 

(c)        The expiration of six (6) months following the issuance of letters testamentary or letters of administration to the executor or administrator of a deceased Optionee, if the Optionee’s death occurs either during his or her employment with the Company or during the thirty (30) day period following the date of termination of such employment pursuant to subparagraph (b) above, but not later than one year after the Optionee's death; or

 

 


 


 

 

 

 

 

(d)       The termination of the Optionee’s employment with the Company for cause.  The term “cause” shall be defined as including, but shall not be limited to, the following: (a) the Optionee’s commission of an act of fraud, misappropriation, embezzlement or the like; or (b) in the event the Optionee is indicted for, pleads guilty or no contest to, or is convicted of a felony.

 

4.         (a)       The Optionee (or Optionee’s executors or administrators) may exercise the Optionee’s Options as to any vested portion of the Option at any time and from time to time prior to the expiration of the Options as provided in Paragraph 3.  The Optionee (or Optionee’s executors or administrators) must give written notice to the Company of the intent to exercise and the number of shares of Stock to be purchased.  In addition, the Optionee’s written notice shall specify a business day prior to the expiration of the Options for the payment in full in cash or shares of Common Stock owned by the Optionee prior to such exercise for the shares of Stock being purchased pursuant to the Option.  The giving of such written notice to the Company shall constitute an irrevocable election to purchase the number of shares of Stock specified in the notice on the date specified in the notice.  On such date, the Optionee shall deliver the required consideration to the Company. 

 

(b)       Notwithstanding the foregoing, the Committee, in its sole discretion, may adjust the period in which the Optionee may exercise any Option to the extent that the Committee deems such modification to be desirable or necessary to comply with applicable requirements of the Code, the Securities Act of 1933 (the “1933 Act”) or the 1934 Act, including recognition of any applicable “blackout period” whereby Company employees are precluded from buying or selling Stock.  The Committee or its delegate shall promptly notify the Optionee of any such adjustments.  No such notice shall be delivered so that the Optionee shall have less than thirty (30) days to exercise his or her Options prior to expiration of such Options. 

 

(c)        The Company shall cause certificates for any shares of Stock to be delivered to the Optionee or Optionee’s executors or administrators within ten (10) business days after the receipt of payment therefore. 

 

5.         Neither the Optionee nor Optionee’s executors or administrators shall have any of the rights of a stockholder of the Company with respect to the shares of Stock subject to this Option until a certificate or certificates for such shares of Stock shall have been issued upon the exercise of this Option. 

 

6.         The Option granted herein shall not be transferable by the Optionee other than pursuant to a qualified domestic relations order or to Optionee’s executors or administrators by will or the laws of descent and distribution, and during the Optionee’s lifetime shall be exercisable only by Optionee (or by the transferee under such a domestic relations order).

 

 

 

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7.         In the event of the Optionee’s death during Optionee’s employment with the Company, or during the thirty (30) day period following the date of termination of such employment pursuant to paragraph 3(b) above, this Option shall thereafter be exercisable, as provided in paragraph 3(c) above, only by Optionee’s executors or administrators. 

 

8.         In the event of any stock split, stock dividend, reclassification, or capitalization which changes the character or amount of the outstanding Stock while any portion of this Option is outstanding but unexercised, the Committee shall make such adjustments in the character and number of shares of Stock subject to such unexercised portion of this Option, and in the Grant Price, as shall be equitable and appropriate in order to make the Option, as nearly as may be practicable, equivalent to this Option immediately prior to such change; provided that no adjustment shall give the Optionee any additional benefits under this Option.

 

                        Upon a Change of Control, the Options shall vest and be payable as provided in the Plan. 

 

9.         The Optionee agrees that the obligation of the Company to issue shares of Stock upon the exercise of an Option shall also be subject as conditions precedent to compliance with applicable provisions of the 1933 Act, the 1934 Act, state securities laws, rules and regulations under any of the foregoing and applicable requirements of any securities exchange upon which the Company's securities shall be listed.

 

Prior to such time as this Option may be exercised, if the Company is registered under the 1934 Act, the Company shall register the Stock subject to the Plan with the Securities and Exchange Commission on Form S-8, or such other form as then applicable.

 

10.       As used herein, the term “employment with the Company” shall include employment with the Company or with any of its Affiliates.  Nothing contained herein shall be deemed a promise of employment or a promise of continued employment. 

 

11.       The Optionee represents that he or she has a copy of the Plan and is familiar with its terms.

 

 

[ Intentionally Blank ]

 

 

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IN WITNESS WHEREOF, the parties have executed this Agreement in duplicate on this _____ day of ________________, _____.

 

ALAMO GROUP INC.

 

 

By: __________________________________

 

 

Its: __________________________________

 

 

ACCEPTED AND AGREED TO:

 

 

_____________________________________

Optionee