Exhibit 10.22


 


DOUGLAS DYNAMICS, INC.


 


AMENDED AND RESTATED 2004 STOCK INCENTIVE PLAN


 


AMENDED AND RESTATED NON-QUALIFIED OPTION AGREEMENT


 


This
Amended and Restated Non-Qualified Stock Option Agreement (“Agreement”) is made
and entered into as of                                 ,
2010 by and between Douglas Dynamics, Inc., a Delaware corporation (the “Company”),
and the person named below as Optionee.


 


THE SECURITIES REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER
THE SECURITIES LAWS OF ANY STATE, AND MAY NOT BE SOLD, TRANSFERRED OR
OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THAT ACT AND UNDER APPLICABLE
STATE SECURITIES LAW OR THE COMPANY SHALL HAVE RECEIVED AN OPINION OF ITS
COUNSEL THAT REGISTRATION OF SUCH SECURITIES UNDER THAT ACT AND UNDER THE
PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED.  THE SALE, TRANSFER OR OTHER DISPOSITION OF
THE SECURITIES IS ALSO SUBJECT TO COMPLIANCE WITH THE TERMS AND CONDITIONS OF
THAT CERTAIN SECOND AMENDED AND RESTATED SECURITYHOLDERS AGREEMENT, DATED AS OF
JUNE 30, 2004, AS SUPPLEMENTED, MODIFIED AND AMENDED FROM TIME TO TIME,
AMONG THE COMPANY AND THE SECURITYHOLDERS SIGNATORY THERETO, A COPY OF WHICH
AGREEMENT IS AVAILABLE FOR INSPECTION DURING REGULAR BUSINESS HOURS AT THE
PRINCIPAL EXECUTIVE OFFICES OF THE COMPANY.


 


WHEREAS,
Optionee is an eligible participant in the Company’s Amended and Restated 2004
Stock Incentive Plan (the “Plan”); and


 


WHEREAS,
the Company and Optionee entered into that certain Non-Qualified Stock Option
Agreement dated as of                        
(the “Original Agreement”) pursuant to which Optionee was granted an option to
purchase shares of the Company’s Common Stock, $0.01 par value per share (the “Common
Stock”), on the terms and conditions set forth therein; and


 


WHEREAS,
the Company and Optionee desire to amend and restate the terms of the Original
Agreement to, in addition to certain ministerial changes, provide that the use
of “net exercise” shall be at the sole discretion of the Committee.


 


NOW,
THEREFORE, in consideration of the foregoing recitals and the covenants set
forth herein, the parties hereto hereby agree as follows:


 


1.             Grant of Option; Certain Terms
and Conditions.  The Company hereby
grants to Optionee, and Optionee hereby accepts, as of the Date of Grant, an
option to purchase the


 

















 


number of shares of Common Stock indicated on the signature page hereto
(the “Option Shares”) at the Exercise Price of $              
per share, which option shall expire at 5:00 o’clock p.m., California
time, on                                   ,
             (the “Expiration
Date”) and shall be subject to all of the terms and conditions set forth in
this Agreement (the “Option”).  On each
of the first, second, third, fourth and fifth anniversaries of                         ,
          , the Option shall
become exercisable to purchase, and shall vest with respect to, that number of
Option Shares (rounded to the nearest whole share) equal to the total number of
Option Shares multiplied by the vesting rate of 20% per year.


 


The
Option is not intended to qualify as an incentive stock option under Section 422
of the Internal Revenue Code (an “Incentive Stock Option”).


 


2.             Acceleration and Termination of
Option.


 


(a)           Change of Control
and Other Events Causing Acceleration of Option.  All Options shall become fully exercisable
immediately prior to a Change of Control or the dissolution or liquidation of
the Company while the Optionee is a member of the Board or any of its
subsidiaries.  In addition, the
Committee, in its sole discretion, may accelerate the exercisability of the
Option at any time and for any reason.


 


(b)           Termination of
Directorship.  In the event that
Optionee shall cease to be a member of the Board or any of its subsidiaries
(such event shall be referred to herein as Optionee’s “Termination”) for any
reason, then (A) the portion of the Option that has not vested on or prior
to the date of such Termination shall terminate as of the date of such Termination
and (B) the vested portion of the Option shall terminate as of the date
that is one hundred eighty (180) days following the date of such Termination.


 


(c)           Other Events
Causing Termination of Option. 
Notwithstanding anything to the contrary in this Agreement, the Option
shall terminate (unless the terms of the transaction giving rise to such
termination provide otherwise) upon the consummation of the dissolution or
liquidation of the Company or a Change of Control, or, if later, the thirtieth
day following the first date upon which such event shall have been approved by
both the Board and the stockholders of the Company; provided  however,
that no such termination shall occur until the Company shall have provided the
Optionee with reasonable notice of such pending termination and Optionee shall
have been provided reasonable opportunity to exercise the Option, as such
Option may be accelerated pursuant to Section 2(a) hereof.


 


3.             Adjustments.  In the event that the outstanding securities
of the class then subject to the Option are increased, decreased or exchanged
for or converted into cash, property and/or a different number or kind of
securities, or cash, property and/or securities are distributed in respect of
such outstanding securities, in either case as a result of a reorganization,
merger, consolidation, recapitalization, reclassification, dividend (other than
a regular, quarterly cash dividend) or other distribution, stock split, reverse
stock split or the like, or in the event that substantially all of the property
and assets of the Company are sold, then, unless (i) such event shall
cause the Option to terminate pursuant to Section 2(c) hereof, or (ii) the
terms of such transaction provide otherwise, the Committee shall make
appropriate and proportionate adjustments in the number and type of shares or
other securities or cash or other property that


 


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may thereafter be acquired upon the exercise of the Option; provided,
however, that any such adjustments in the Option shall be made without
changing the aggregate Exercise Price of the then unexercised portion of the
Option.


 


4.             Exercise.  The Option shall be exercisable during
Optionee’s lifetime only by Optionee or by his or her guardian or legal representative,
and after Optionee’s death only by the person or entity entitled to do so under
Optionee’s last will and testament or applicable intestate law.  The Option may only be exercised by the
delivery to the Company of a written notice of such exercise, which notice
shall specify the number of Option Shares to be purchased (the “Purchased
Shares”) and the aggregate Exercise Price for such shares, together with
payment in full of such aggregate Exercise Price in cash or by check payable to
the Company; provided, however, that payment of such aggregate
Exercise Price may instead be made, in whole or in part, by (i) the delivery to
the Company of a certificate or certificates representing shares of Common
Stock, duly endorsed or accompanied by a duly executed stock powers, which
delivery effectively transfers to the Company good and valid title to such
shares, free and clear of any pledge, commitment, lien, claim or other
encumbrance (such shares to be valued on the basis of the aggregate Fair Market
Value (as defined in the Plan) thereof on the date of such exercise), or (ii) at
the sole discretion of the Committee, by a reduction in the amount of Purchased
Shares or other property otherwise issuable pursuant to such Option (such
reduction to be valued on the basis of the aggregate Fair Market Value, on the
date of exercise, of the additional Purchased Shares that would have been
delivered to the Optionee upon exercise of the Option), provided that
the Company is not then prohibited from purchasing or acquiring such shares of
Common Stock.


 


5.             Securityholders Agreement.  As of the Date of Grant, the Optionee shall
execute and agree to be bound by the terms of that certain Second Amended and
Restated Securityholders Agreement among the Company and certain of its
securityholders, dated as of June 30, 2004, as amended from time to time
(the “Securityholders Agreement”).


 


6.             Payment of Withholding Taxes.  If the Company becomes obligated to withhold
an amount on account of any tax imposed as a result of the exercise of the
Option, including, without limitation, any federal, state, local or other
income tax, or any F.I.C.A., state disability insurance tax or other employment
tax, then Optionee shall, on the first day upon which the Company becomes
obligated to pay such amount to the appropriate taxing authority, pay such
amount to the Company in cash or by check or other property acceptable to the
Secretary of the Company in his sole discretion; and, if the Optionee fails to
make such payment, the Company is authorized by the Optionee to withhold from
any payments then or thereafter payable to the Optionee, any such amounts or
the Company may otherwise refuse to issue or transfer any shares otherwise
required to be issued or transferred pursuant to the terms hereof.  The Committee may, in its sole discretion,
allow the Optionee to pay any such amounts through the surrender of whole
shares of Common Stock.  Any such shares
surrendered shall be valued at their market value, determined by such method as
the Secretary of the Company in his sole discretion shall determine, equal to
the sums required to be withheld as of the date on which the amount of tax to
be withheld is determined.


 


7.             Notices.  All notices and other communications required
or permitted to be given pursuant to this Agreement shall be in writing and
shall be deemed given if delivered personally or five days after mailing by
certified or registered mail, postage prepaid, return receipt requested, to the
Company c/o Gibson, Dunn & Crutcher LLP, 333 South Grand Avenue, Los
Angeles, California 90071-3197, Attention: Bruce D. Meyer, Esq., or to
Optionee at the address


 


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set forth beneath his or her signature on the signature page hereto,
or at such other addresses as they may designate by written notice in the
manner aforesaid.


 


8.             Compliance with Legal
Requirements.


 


(a)           No Option Shares shall be issued or
transferred pursuant to this Agreement unless and until all legal requirements
applicable to such issuance or transfer have, in the opinion of counsel to the
Company, been satisfied.  Such
requirements may include, but are not limited to, registering or qualifying
such Option Shares under any state or federal law, satisfying any applicable
law relating to the transfer of unregistered securities or demonstrating the
availability of an exemption from applicable laws, placing a legend on the
Option Shares to the effect that they were issued in reliance upon an exemption
from registration under the Securities Act of 1933, as amended (the “Act”), and
may not be transferred other than in reliance upon Rule 144 or Rule 701
promulgated under the Act, if available, or upon another exemption from the
Act, or obtaining the consent or approval of any governmental regulatory body.  The Company shall use its best efforts to
comply with all legal requirements applicable to the issuance or transfer of
Option Shares.


 


(b)           The Optionee understands that the
Company intends for the offering and sale of Option Shares to be effected in reliance
upon Rule 701 or another available exemption from registration under the
Act, and that the Company is under no obligation to register for resale the
Option Shares issued upon exercise of the Option, subject to the
Securityholders Agreement.  In connection
with any such issuance or transfer, the person acquiring the Option Shares
shall, if requested by the Company, provide information and assurances
satisfactory to counsel to the Company with respect to such matters as the
Company reasonably may deem desirable to assure compliance with all applicable
legal requirements.


 


9.             Nontransferability.  Neither the Option nor any interest therein
may be Transferred in any manner other than by will or the laws of descent and
distribution.


 


10.           Plan.  The Option is granted pursuant to the Plan,
as in effect on the Date of Grant, and is subject to all the terms and
conditions of the Plan, as the same may be amended from time to time; provided,
however, that no such amendment shall deprive Optionee, without his or her
consent, of the Option or of any of Optionee’s rights under this
Agreement.  The interpretation and
construction by the Committee of the Plan, this Agreement, the Option and such rules and
regulations as may be adopted by the Committee for the purpose of administering
the Plan shall be final and binding upon Optionee.  Until the Option shall expire, terminate or
be exercised in full, the Company shall, upon written request therefor, send a
copy of the Plan, in its then-current form, to Optionee or any other person or
entity then entitled to exercise the Option.


 


11.           Stockholder Rights.  No person or entity shall be entitled to
vote, receive dividends or be deemed for any purpose the holder of any Option
Shares until the Option shall have been duly exercised to purchase such Option
Shares in accordance with the provisions of this Agreement.


 


12.           Employment Rights.  No provision of this Agreement or of the
Option granted hereunder shall (a) confer upon Optionee any right to be or
continue, as the case may be, in the


 


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employ of the Company or any of its subsidiaries, (b) affect the
right of the Company and each of its subsidiaries to terminate the employment
of Optionee, with or without cause, or (c) confer upon Optionee any right
to participate in any employee welfare or benefit plan or other program of the
Company or any of its subsidiaries other than the Plan.  Optionee hereby
acknowledges and agrees that the Company and each of its subsidiaries may
terminate the employment of Optionee at any time and for any reason, or for no
reason, unless Optionee and the Company or such subsidiary are parties to a
written employment agreement that expressly provides otherwise.


 


13.           Governing Law.  This Agreement and the Option granted
hereunder shall be governed by and construed and enforced in accordance with
the laws of the State of Delaware without reference to choice or conflict of
law principles.


 


14.           Definitions.


 


An
“Affiliate” of a specified Person means a Person that controls, is
controlled by, or is under common control with, the specified Person, and in
this context, “control”, “controls” and “controlled” mean
the direct or indirect power to direct the management and policies or affairs
of a Person through the ownership of voting securities or by contract or
otherwise and, in the case of a limited partnership, shall include, but shall
not be limited to, all of the limited partnership’s general partners and their
respective Affiliates.


 


“Ares”
means Ares Corporate Opportunities Fund, L.P., a Delaware limited partnership.


 


“Ares
Purchasers” means Ares and its Affiliates.


 


“Aurora
Purchasers” means Aurora Equity Partners II L.P., a Delaware limited
partnership, Aurora Overseas Equity Partners II, L.P., a Cayman Islands limited
partnership, and their respective Affiliates and co-investors.


 


“Board”
means the Board of Directors of the Company.


 


“Beneficial
Owner” has the meaning attributed to it in Rules 13d-3 and 13d-5 of
the rules and regulations promulgated by the Securities and Exchange
Commission (the “Commission”) under the Securities Exchange Act of 1934
(as in effect on the date hereof), whether or not applicable, except that a
Person shall be deemed to have “beneficial ownership” of any securities that
such Person has the right to acquire, whether or not such right is exercisable
immediately or within 60 days after the date as of which such determination is
being made.  “Beneficially Owned”
and “Beneficial Ownership” shall have correlative meanings to the term “Beneficial
Owner.”


 


“Capital
Stock” means any and all shares, interests, participations or other
equivalents  (however designated) of
capital stock of a corporation, any and all equivalent ownership interests in a
Person (other than a corporation), including, without limitation, partnership
interests and membership interests, and any and all warrants, rights or options
to purchase or other arrangements or rights to acquire any of the foregoing


 


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“Change
of Control” means, at any time, (i) the Aurora Purchasers and Ares
Purchasers shall cease to collectively beneficially own and control at least
51%, on a fully diluted basis, of the outstanding Capital Stock of the Company
entitled (without regard to the occurrence of any contingency) to vote for the
election of members of the Board (or similar governing body) of the Company,
unless the Aurora Purchasers and Ares Purchasers collectively beneficially own
and control (a) at least 35%, on a fully diluted basis, of the outstanding
Capital Stock of the Company entitled (without regard to the occurrence of any
contingency) to vote for the election of members of the Board (or similar
governing body) of the Company and (b) on a fully diluted basis, more of
the outstanding Capital Stock of the Company entitled (without regard to the
occurrence of any contingency) to vote for the election of members of the Board
(or similar governing body) of the Company than any other Person or “group”
(within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act); (ii) any
Person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the
Exchange Act) other than the Aurora Purchasers and Ares Purchasers collectively
shall have obtained the power (whether or not exercised) to elect a majority of
the members of the Board (or similar governing body) of the Company; (iii) the
Company shall cease to beneficially own and control 100% on a fully diluted
basis of the economic and voting interests in the Capital Stock of Douglas
Dynamics, L.L.C.; or (iv) the majority of the seats (other than vacant
seats) on the Board (or similar governing body) of the Company cease to be
occupied by Persons who either (a) were members of the Board of the
Company on the Initial Date or (b) were nominated for election by the
Board of the Company, a majority of whom were directors on the Initial Date or
whose election or nomination for election was previously approved by a majority
of such directors.


 


“Committee”
means a committee of the Board administering the Plan pursuant to the terms of
the Plan, or in absence of such a committee, the Board itself.


 


“Exchange
Act” means the Securities Exchange Act of 1934, as amended from time to
time, and any successor statute.


 


“Initial
Date” means the date of the filing of the Second Amended and Restated
Certificate of Incorporation of the Company with the Secretary of State of the
State of Delaware


 


“Option”
means any options now or hereafter issued by the Company to purchase Common
Stock.


 


“Person”
means a company, a corporation, an association, a partnership, a limited
liability company, an organization, a joint venture, a trust or other legal
entity, an individual, a government or political subdivision thereof or a
governmental agency.


 


“Transfer”
means any sale, exchange, assignment, transfer, pledge, mortgage,
hypothecation, gift, grant, encumbrance or other disposition of any kind,
whether voluntary, involuntary or by operation of law and whether direct or
indirect by transfer of any interest in the subject property or otherwise.


 


15.           Optionee Address.  Optionee represents that the address set
forth on the signature page hereto is Optionee’s true and correct address,
and acknowledges that the Company is relying upon such representations for
securities law purposes.


 


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IN
WITNESS WHEREOF, the Company and Optionee have duly executed this Agreement as
of the date set forth above.


 


	
   

  	
  DOUGLAS
  DYNAMICS, INC.,

  
	
   

  	
  a
  Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  OPTIONEE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [Name
  of Optionee]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Street
  Address

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  City,
  State and Zip Code

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Social
  Security Number

  
	
   

  	
   

  
	
   

  	
   

  
	
  Number of Shares Subject to Option:

  	
   

  



 


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