**Exhibit 10.5**

 

**RESTRICTED STOCK UNIT AWARDAGREEMENT**

**BROADWIND ENERGY, INC.**

**2007 EQUITY INCENTIVE PLAN**

 

THIS AGREEMENT, made effective as of this           day of                              ,20    , by and between Broadwind Energy, Inc., aDelaware corporation (the “**Company**”), and                                      (“**Participant**”).

 

**RECITALS**

 

WHEREAS, Participant on the date hereof is a key employee, officer,director of, or consultant or advisor to, the Company or one of itsSubsidiaries; and

 

WHEREAS, the Company wishes to grant a restricted stock unit award toParticipant for shares of the Company’s Common Stock pursuant to the Company’s2007 Equity Incentive Plan (the “**Plan**”); and

 

WHEREAS, the Administrator of the Plan has authorized the grant of arestricted stock unit award to Participant;

 

**AGREEMENTS**

 

In consideration of the premises and of the mutual covenants hereincontained, the parties hereto agree as follows:

 

**ARTICLE I.  GRANT OF RESTRICTED STOCK UNIT AWARD**

 

The Company hereby grants to Participant this restricted stock unitaward (the “**Award**”) for                                                (                          )restricted stock units on the terms and conditions set forth herein.  Each restricted stock unit shall entitle theParticipant to receive one share of the Company’s Common Stock.  **[If there isperformance-based vesting, include the following: This Award shall expire                                        ,unless terminated earlier under the provisions of Article II below.]**

 

**ARTICLE II.  VESTING OF RESTRICTED STOCK UNITS**

 

A.            General. The restricted stock units subject to this Award shall vest according tothe following schedule:

 
| **Vesting Date**                                                                            | ** ** | **Number of  Shares** |
|---------------------------------------------------------------------------------------------|------------|-----------------------|
|                                                                                        |       |                  |
|               ,  2010 |       |                  |
|               ,  2011 |       |                  |
|               ,  2012 |       |                  |

 

Subject to such other terms and conditions set forth in this Agreement,the Participant shall not be entitled to the issuance of shares for any portionof the restricted stock units subject to this Award until the Administratordetermines the number of restricted stock units, if any, which have vested.

 

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B.            Termination of Relationship.  If, prior to the vesting of all or anyportion of the Award, Participant ceases to be **[a keyemployee or officer]****[a consultant or advisor][a director]** of the Company or any Affiliate for any reason, theParticipant shall forfeit all restricted stock units subject to this Awardwhich have not vested and this Award shall terminate as of the date of the actgiving rise to such termination.

 

C.            Issuance of Shares; Rights as a Stockholder*.* On each Vesting Date, the Company shall cause to be issued a stockcertificate representing that number of shares of Common Stock that is equal tothe number of restricted stock units that have vested as of such Vesting Date,less any shares withheld for payment of taxes as provided in **Article IV** below, and shall deliver such certificate toParticipant.  Until the issuance of suchshares, Participant shall not be entitled to receive dividends attributable tosuch shares of Common Stock, and shall not have any other rights as astockholder with respect to such shares. No adjustment shall be made fordividends (ordinary or extraordinary, whether in cash, securities or otherproperty), distributions or other rights for which the record date is prior tothe date such shares are issued, except as provided in Section 14 of thePlan and **Article V** of this Agreement.

 

**ARTICLE III.  NONTRANSFERABILITY**

 

This Award shall not be transferable, in whole or in part, byParticipant, other than by will or by the laws of descent and distribution,prior to the Vesting Date for each portion of the Award.  If Participant shall attempt any transfer ofthis Award prior to such date, such transfer shall be void and this Award shallterminate.

 

**ARTICLE IV.  WITHHOLDING TAXES**

 

To permit the Company to comply with all applicable federal and stateincome tax laws or regulations, the Company may take such action as it deemsappropriate to ensure that, if necessary, all applicable federal and statepayroll, income or other taxes attributable to this Award are withheld from anyamounts payable by the Company to the Participant.  If the Company is unable to withhold suchfederal and state taxes, for whatever reason, the Participant hereby agrees topay to the Company an amount equal to the amount the Company would otherwise berequired to withhold under federal or state law prior to the issuance of anycertificates for the shares of Common Stock subject to this Award.  Subject to such rules as theAdministrator may adopt, the Administrator may, in its sole discretion, permitParticipant to satisfy such withholding tax obligations, in whole or in part,by delivering shares of the Company’s Common Stock, including shares of CommonStock received pursuant to this Award upon vesting.  Such shares shall have a Fair Market Valueequal to the minimum required tax withholding, based on the minimum statutorywithholding rates for federal and state tax purposes, including payroll taxes,that are applicable to the supplemental income attributable to this Award.  In no event may the Participant delivershares having a Fair Market Value in excess of such statutory minimum requiredtax withholding.  The Participant’selection to deliver shares or to have shares withheld for this purpose shall bemade on or before the date that the amount of tax to be withheld is determinedunder applicable tax law.  Such electionshall be approved by the Administrator and otherwise comply with such rules asthe Administrator may adopt to assure compliance with Rule 16b-3, or anysuccessor provision, as then in effect, of the General Rules andRegulations under the Securities Exchange Act of 1934, if applicable.

 

**ARTICLE V.  CAPITAL ADJUSTMENTS**

 

Except as otherwise specifically provided in any employment, change ofcontrol, severance or similar agreement executed by the Participant and theCompany, pursuant and subject to Section 14 of the Plan, certain changesin the number or character of the Common Stock of the Company (through merger,consolidation, exchange, reorganization, divestiture (including a spin-off),liquidation, recapitalization, stock split, stock dividend or otherwise) shallresult in an adjustment, reduction or enlargement, as appropriate, inParticipant’s rights with respect to any restricted stock units subject to thisAward which continue to be subject to vesting

 

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(*i.e.*, Participant shall have such “anti-dilution”rights under the Award with respect to such events, but shall not have “preemptive”rights).

 

**ARTICLE VI.  BINDING EFFECT**

 

This Agreement shall be binding upon the heirs, executors,administrators and successors of the parties hereto.

 

**ARTICLE VII.  2007 EQUITY INCENTIVE PLAN**

 

The Award represented by this Agreement has been granted under, and issubject to the terms of, the Plan.  Theterms of the Plan are hereby incorporated by reference herein in their entiretyand Participant, by execution hereof, acknowledges having received a copy ofthe Plan.  Capitalized terms not definedherein shall have the meaning set forth in the Plan.  The provisions of this Agreement shall beinterpreted as to be consistent with the Plan and any ambiguities herein shallbe interpreted by reference to the Plan. In the event that any provision hereof is inconsistent with the terms ofthe Plan, the latter shall prevail.

 

**ARTICLE VIII.  NON-SOLICITATION**

 

A.            Restrictive Covenant.  During the period beginning on the date ofthis Award and ending on the date which is one year following the terminationof Participant’s employment with, or service to, the Company or an Affiliatepursuant to **ARTICLE II.  B**, Participant shall not, exceptwith the express prior written consent of the Company:  (i) directly or indirectly, either forParticipant, or on behalf of any of the Company’s or any Affiliate’scompetitors (“**Competitors**”): (1) induce orattempt to induce any employee, independent contractor or consultant of theCompany or any Affiliate to leave the employ of, or terminate its engagementwith, the Company or any Affiliate; or (2) in any way interfere with therelationship between the Company or any Affiliate and any employee, independentcontractor or consultant of the Company or any Affiliate; or (ii) directlyor indirectly, either for Participant, or on behalf of any of the Competitors,solicit the business of any person or entity known to Participant to be acustomer of the Company or any of its Affiliates, where Participant, or anyperson reporting to Participant, had an ongoing business relationship or hadmade substantial efforts with respect to such customer during Participant’semployment with, or service to, the Company or an Affiliate.

 

B.            Violation of Restrictive Covenant.  Participant, by accepting this Award, agreesthat the foregoing covenants are reasonable with respect to their duration andscope.  Participant further acknowledgesthat the restrictions are reasonable and necessary for the protection of thelegitimate business interests of the Company and its Affiliates, that theycreate no undue hardships, that any violation of these restrictions would causesubstantial injury to the Company and its Affiliates, and that suchrestrictions were a material inducement to the Company to grant thisAward.  In the event of any violation orthreatened violation of these restrictions, Participant shall forfeit allrestricted stock units subject to this Award which have not vested and thisAward shall terminate as of the date of the violation or threatened violationof these restrictions.

 

**ARTICLE IX.  MISCELLANEOUS**

 

A.            Employment or Other Relationship.  Nothing in this Agreement shall be construedto (a) limit in any way the right of the Company or any Affiliate toterminate the status of Participant as an employee of the Company at any time,or (b) be evidence of any agreement or understanding, express or implied,that the Company or any Affiliate will employ Participant in any particularposition, at any particular rate of compensation or for any particular periodof time.

 

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B.            Securities Law Compliance.  Participant shall not transfer or otherwisedispose of the shares of Common Stock received pursuant to this Agreement untilsuch time as counsel to the Company shall have determined that such transfer orother disposition will not violate any state or federal securities laws.  Participant may be required by the Company,as a condition of the effectiveness of this Award, to agree in writing that allCommon Stock subject to this Agreement shall be held, until such time that suchCommon Stock is registered or otherwise freely tradable under applicable stateand federal securities laws, for Participant’s own account without a view toany further distribution thereof, that the certificates for such shares shallbear an appropriate legend to that effect and that such shares will be nottransferred or disposed of except in compliance with applicable state andfederal securities laws.

 

C.            Lockup Period Limitation.  Participant agrees that in the event the Companyadvises Participant that it plans an underwritten public offering of its CommonStock in compliance with the Securities Act of 1933, as amended, and that theunderwriter(s) seek to impose restrictions under which certainstockholders may not sell or contract to sell or grant any option to buy orotherwise dispose of part or all of their stock purchase rights of theunderlying Common Stock, Participant hereby agrees that for a period not toexceed 180 days from the prospectus, Participant will not sell or contract tosell or grant an option to buy or otherwise dispose of this Award or any of theunderlying shares of Common Stock without the prior written consent of the ofthe underwriter(s) or its representative(s).

 

D.            Blue Sky Limitation.  Notwithstanding anything in this Agreement tothe contrary, in the event the Company makes any public offering of itssecurities and determines, in its sole discretion, that it is necessary toreduce the number of issued but unexercised stock purchase rights so as tocomply with any state securities or Blue Sky law limitations with respectthereto, the Administrator of the Company shall accelerate the vesting of thisrestricted stock unit award, provided that the Company gives Participant 15days’ prior written notice of such acceleration.  Notice shall be deemed given when deliveredpersonally or when deposited in the United States mail, first class postageprepaid and addressed to Participant at the address of Participant on file withthe Company.

 

E.             Accounting Compliance.  Participant agrees that, if a “transaction”(as defined in Section 14 of the Plan) occurs, and Participant is an “affiliate”of the Company or any Affiliate (as defined in applicable legal and accountingprinciples) at the time of such transaction, Participant will comply with allrequirements of Rule 145 of the Securities Act of 1933, as amended, andthe requirements of such other legal or accounting principles, and will executeany documents necessary to ensure such compliance.

 

F.             Stock Legend.  The Administrator may require that thecertificates for any shares of Common Stock issued to Participant (or, in thecase of death, Participant’s successors)  under this Agreement shall bearan appropriate legend to reflect the restrictions of this **ARTICLE IX. **; *provided,however,* that failure to so endorse any of such certificates shallnot render invalid or inapplicable this**ARTICLE IX.**

 

G.            Shares Reserved. The Company shall at all times during the term of this Award reserve andkeep available such number of shares as will be sufficient to satisfy therequirements of this Agreement.

 

H.            Arbitration. Any dispute arising out of or relating to this Agreement or the allegedbreach of it, or the making of this Agreement, including claims of fraud andinducement, shall be discussed between the disputing parties in a good faitheffort to arrive at a mutual settlement of any such controversy.  If, notwithstanding, such dispute cannot beresolved, such dispute shall be settled by binding arbitration.  Judgment upon the award rendered by thearbitrator may be entered in any court having jurisdiction thereof.  The arbitrator shall be a retired state orfederal judge or an attorney who has practiced securities or business litigationfor at least ten (10) years.  If theparties cannot agree on an arbitrator within twenty (20) days, any party mayrequest that a judge of the Circuit Court of Cook County, Illinois selectan arbitrator.  Arbitration will beconducted pursuant to the provisions of this Agreement and the commercialarbitration rules of the American

 

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Arbitration Association, unless such rules are inconsistent withthe provisions of this Agreement. Limited civil discovery shall be permitted for the production ofdocuments and taking of depositions. Unresolved discovery disputes may be brought to the attention of thearbitrator who may dispose of such disputes. The arbitrator shall have the authority to award any remedy or reliefthat a court of this state could order or grant; *provided,however,* that punitive or exemplary damages shall not beawarded.  The arbitrator may award to theprevailing party, if any, as determined by the arbitrator, all of its costs andfees, including the arbitrator’s fee, administrative fees, travel expenses,out-of-pocket expenses and reasonable attorney’s fees.  Unless otherwise agreed by the parties, theplace of any arbitration proceedings shall be Chicago, Illinois.

 

I.              Right to Amend. The Company hereby reserves the right to amend this Agreement withoutParticipant’s consent to the extent necessary or desirable to comply with therequirements of Code Section 409A and the regulations, notices and otherguidance of general application issued thereunder.

 

J.             **[If there is performance-basedvesting, include the following:**  Delay of Payment for Specified Employee.  Notwithstanding anything herein to thecontrary, if any payments to be made to Participant hereunder are subject tothe requirements of Code Section 409A and the Company determines thatParticipant is a “specified employee” as defined in Code Section 409A asof the date of the termination, such payments shall not be paid or commenceearlier than the date that is six months after the termination.  Any payment not made during the six monthperiod shall be paid on the first day of the seventh month followingtermination.**]**

 

**ARTICLE X.  GOVERNING LAW**

 

This Agreement and all rights and obligations hereunder shall beconstrued in accordance with the Plan and governed by the laws of the State ofDelaware.

 

*[SignaturePage Follows]*

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreementeffective the day and year first above written.

 
| ** **                                                                              | **BROADWIND ENERGY INC.** |
|-----------------------------------------------------------------------------------------|---------------------------|
| ** **                                                                              | ** **                |
| ** **                                                                              | ** **                |
| ** **                                                                              | ** **                |
| ** **                                                                              | By:                       |
| ** **                                                                              | Its:                      |
| ** **                                                                              |                      |
| ** **                                                                              |                      |
| By execution hereof, the Participant  acknowledges having received a copy of the  Plan. | **PARTICIPANT**           |
|                                                                                    | ** **                |

 

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