GEHL COMPANY
                           2000 EQUITY INCENTIVE PLAN

                             STOCK OPTION AGREEMENT
                           FOR NON-EMPLOYEE DIRECTORS



          THIS AGREEMENT, dated as of this _____ day of ________________,  ____,
by and between  Gehl  Company,  a Wisconsin  corporation  (the  "Company"),  and
_________________ (the "Optionee").

                              W I T N E S S E T H :

          WHEREAS,  the  Company  has  adopted  the  Gehl  Company  2000  Equity
Incentive  Plan (the  "Plan"),  the terms of which,  to the  extent  not  stated
herein, are specifically incorporated by reference in this Agreement; and

          WHEREAS,  the  Plan  authorizes  the  automatic  grant of  options  to
purchase  shares of the  Company's  Common  Stock,  $.10 par value (the  "Common
Stock"), to members of the Company's Board of Directors who are not employees of
the Company or any affiliate of the Company (a "Non-Employee Director"); and

          WHEREAS, the Optionee is now a Non-Employee  Director, and the Company
desires him to continue as a member of the  Company's  Board of Directors and to
secure or increase his stock  ownership in the Company as an added incentive for
him to continue his association with the Company.

          NOW, THEREFORE,  in consideration of the premises and of the covenants
and agreements  herein set forth, the parties hereby mutually covenant and agree
as follows:

          1.  Grant of Option.  Subject to the terms and  conditions of the Plan
and this  Agreement,  the Company  hereby  grants to the Optionee an option (the
"Option") to purchase from the Company all or any part of the  aggregate  amount
of 2,000 shares of Common Stock (the "Optioned Shares").  The Option is intended
to  constitute  a  non-qualified  stock  option  and shall not be  treated as an
incentive stock option within the meaning of Section 422 of the Internal Revenue
Code of 1986, as amended, or any successor provision thereto.

          2.  Option  Price.  The per  share  exercise  price to be paid for the
Optioned Shares shall be $_____.


<PAGE>




          3.  Exercisability  and  Termination  of  Option.  The  Option  may be
exercised by the Optionee only in accordance with the following schedule:

                                       Cumulative Percentage of Shares Subject
                                          to Option Which May be Purchased
   Elapsed Period of Time              (which number of shares shall be rounded
After Date Option is Granted              down to the nearest whole number)
----------------------------           ----------------------------------------

    Less than One (1) Year                                  0%
    One (1) Year                                       33-1/3%
    Two (2) Years                                      66-2/3%
    Three (3) Years                                       100%


Notwithstanding the foregoing schedule,  if the Optionee ceases to be a director
of  the  Company  by  reason  of  death,   disability  or  retirement  prior  to
______________,  ____, or in the event of a Change of Control of the Company (as
defined in the Plan) prior to  ______________,  ____,  the Option  shall  become
immediately  exercisable in full. The Option shall  terminate on the earlier of:
(i) _______________, ____; or (ii) twelve months after the Optionee ceases to be
a  director  of the  Company  for  any  reason,  including  as a  result  of the
Optionee's death, disability or retirement.

          4.  Manner of  Exercise  and  Payment.  Subject to the  provisions  of
Paragraph 3 hereof and the Plan, the Option may be exercised in full at any time
or in part from time to time by delivery to the  Secretary of the Company at the
Company's  principal  office in West  Bend,  Wisconsin,  of a written  notice of
exercise  specifying  the number of shares  with  respect to which the Option is
being  exercised.  The notice of exercise must be accompanied by payment in full
of the  exercise  price  of the  shares  being  purchased:  (i) in  cash  or its
equivalent; (ii) by tendering previously acquired shares of Common Stock (valued
at their "market value" as of the date of exercise,  as determined in the manner
provided in Section  6(b)(iv) of the Plan);  or (iii) by any  combination of the
means of  payment  set forth in  subparagraphs  (i) and (ii).  For  purposes  of
subparagraphs  (ii) and (iii) above,  the term  "previously  acquired  shares of
Common Stock" shall only include shares of Common Stock owned by the Optionee at
least six months prior to the exercise of the Option for which  payment is being
made and shall not in any event  include  shares of Common Stock which are being
acquired pursuant to the exercise of the Option. No shares shall be issued until
full payment therefor has been made.

          5.  Nontransferability  of  the  Option.   The  Option  shall  not  be
transferable  by the  Optionee  other  than by will or the laws of  descent  and
distribution;  provided,  however,  that the Optionee shall be entitled,  in the
manner  provided in Paragraph 6 hereof,  to designate a beneficiary  to exercise
his rights, and to receive any shares of Common Stock issuable,  with respect to
the Option upon the death of the  Optionee.  The Option may be exercised  during
the lifetime of the Optionee only by the Optionee or, if permitted by applicable
law, the Optionee's guardian or legal



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<PAGE>


representative.

          6.  Designation of  Beneficiary.

              (a)  The person whose name  appears on the  signature  page hereof
after the caption  "Beneficiary" or any successor  designated by the Optionee in
accordance herewith (the person who is the Optionee's beneficiary at the time of
his death herein referred to as the "Beneficiary") shall be entitled to exercise
the Option,  to the extent it is  exercisable,  after the death of the Optionee.
The Optionee may from time to time revoke or change his Beneficiary  without the
consent  of  any  prior  Beneficiary  by  filing  a  new  designation  with  the
Compensation and Benefits  Committee of the Board of Directors of the Company or
such other committee of the Board which shall have been designated to administer
the Plan (the "Committee").  The last such designation received by the Committee
shall be  controlling;  provided,  however,  that no  designation,  or change or
revocation thereof, shall be effective unless received by the Committee prior to
the Optionee's death, and in no event shall any designation be effective as of a
date prior to such receipt.

              (b)  If no such  Beneficiary  designation is in effect at the time
of the Optionee's death, or if no designated  Beneficiary  survives the Optionee
or if such  designation  conflicts  with law,  the  Optionee's  estate  shall be
entitled to exercise the Option, to the extent it is exercisable after the death
of the  Optionee.  If the Committee is in doubt as to the right of any person to
exercise the Option, the Company may refuse to recognize such exercise,  without
liability  for any  interest or  dividends  on the  Optioned  Shares,  until the
Committee  determines the person entitled to exercise the Option, or the Company
may apply to any court of appropriate jurisdiction and such application shall be
a complete discharge of the liability of the Company therefor.

          7.  Capital  Adjustments  Affecting  the Common  Stock.  The number of
Optioned Shares subject hereto and the related per share exercise price shall be
subject to adjustment in accordance with Section 4(b) of the Plan.

          8.  Transfer Restrictions.  The shares to be acquired upon exercise of
the  Option  may not be sold or  otherwise  disposed  of except  pursuant  to an
effective  registration  statement under the Securities Act of 1933, as amended,
or in a transaction which, in the opinion of counsel for the Company,  is exempt
from registration under said Act.

          9.  Status  of  Optionee.  The  Optionee  shall  have no  rights  as a
shareholder  with  respect to shares  covered  by the  Option  until the date of
issuance of stock  certificates  to the  Optionee and only after such shares are
fully paid.  The Option shall not confer upon the Optionee the right to continue
as a director of the Company.



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<PAGE>




          10. Interpretation by Committee. As a condition of the granting of the
Option, the Optionee agrees, for himself and his personal representatives,  that
this Agreement  shall be  interpreted by the Committee and that,  subject to the
express terms of the Plan, any  interpretation  by the Committee of the terms of
this  Agreement and any  determination  made by the  Committee  pursuant to this
Agreement shall be final, binding and conclusive.

          IN WITNESS  WHEREOF,  the  Company  has caused  this  Agreement  to be
executed by its duly authorized officers,  and the Optionee has hereunto affixed
his hand as to the day and year first above written.

                                      GEHL COMPANY


                                      By:
                                         ---------------------------------------


                                      Attest:
                                             -----------------------------------



                                                                      , Optionee
                                      --------------------------------


                                      Beneficiary:
                                                  ------------------------------

                                      Address of Beneficiary:
                                                             -------------------

                                      ------------------------------------------


                                      Beneficiary's Tax Identification/
                                      Social Security No.:
                                                          ----------------------


scb/options/diragre2



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