Exhibit
10.5


TETON
ADVISORS, INC.





RESTRICTED
STOCK AWARD AGREEMENT








THIS
RESTRICTED STOCK AWARD AGREEMENT, (the "Agreement"), dated as of March 20, 2009,
is made by and between Teton Advisors, Inc., a Delaware corporation (the
"Company"), and Nicholas F. Galluccio (the "Grantee").








WHEREAS,
the Company and the Grantee entered into an employment contract dated July 18,
2008 pursuant to which the Company agreed to grant certain restricted shares in
the Company to the Grantee on the terms and conditions set forth herein (the
“Restricted Stock”);





WHEREAS,
the Grantee began his employment with the Company on July 18, 2008 (the
“Employment Date”).





NOW,
THEREFORE, in consideration of the recitals and the mutual agreements herein
contained, the parties hereto agree as follows:





Section
1.                      Grant of Restricted Stock
Award





Grant of Restricted
Stock.  As of March 20, 2009 (the “Grant Date”), the Company
grants to the Grantee 260,849 shares of Class A Common Stock of Restricted Stock
in Teton on the terms and conditions set forth in this Agreement.








Section
2.                      Terms and Conditions of
Award





The grant
of Restricted Stock provided in Section 1(a) shall be subject to the following
terms, conditions and restrictions:





(a)           Ownership of Shares.Subject
to the restrictions set forth in this Agreement, the Grantee shall possess all
incidents of ownership of the Restricted Stock granted hereunder, including the
right to receive dividends with respect to such Stock and the right to vote such
Stock.





(b)           Payment of
Dividends.  The Grantee shall be entitled to accumulate
dividends which become payable on the Restricted Stock.  The dividends
will be paid pro rata upon vesting of the Restricted Stock.  If the
Company or the Grantee terminates the Grantee's employment for any reason prior
to vesting of the Award, then the Award and associated unpaid dividends shall be
forfeited except as set forth below in Section 2(f).  No interest
shall accrue on dividends held by the Company in its accounts on behalf of the
Grantee





(c)           Restrictions.  Restricted
Stock and any interest therein may not be sold, assigned, transferred, pledged,
hypothecated or otherwise disposed of.  The Board of Directors of the
Company may, in its discretion, cancel all or any portion of any outstanding
restrictions prior to the expiration of the periods provided under Section
2(e).





(d)           Certificate; Restrictive
Legend.  The Grantee agrees that any certificate issued for
Restricted Stock prior to the lapse of any outstanding 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 an agreement entered into between
the registered owner and Teton Advisors, Inc.  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.





(e)           Lapse of
Restrictions.  Except as may otherwise be provided herein, the
restrictions on transfer set forth in Section 2(c) shall lapse as
follows:





With
respect to thirty percent (30%) of the shares of Restricted Stock subject to
this Restricted Stock Award, on the third anniversary of the Employment Date, so
long as the Grantee is employed by or providing services to the Company or its
subsidiaries as of such date; and





With
respect to seventy percent (70%) of the shares of Restricted Stock subject to
this Restricted Stock Award, on the fifth anniversary of the Employment Date, so
long as the Grantee is employed by or providing services to the Company or its
subsidiaries as of such date.





Upon each
lapse of restrictions relating to Restricted Stock, the Company shall issue to
the Grantee or the Grantee's personal representative a stock certificate
representing a number of shares of Stock, free of the restrictive legend
described in Section 2(d), equal to the number of shares subject to this
Restricted Stock Award with respect to which such restrictions have lapsed
Rounded up to the nearest whole share.  If certificates representing
such Restricted Stock shall have theretofore been delivered to the Grantee, such
certificates shall be returned to the Company, complete with any necessary
signatures or instruments of transfer prior to the issuance by the Company of
such unlegended shares of Stock.





(f)           Termination of
Employment.  In the event that the Grantee's service with the
Company and its subsidiaries is terminated prior to the lapsing of restrictions
with respect to any portion of the Restricted Stock granted hereunder, such
portion of the Restricted Stock held by the Grantee shall be immediately
forfeited, provided, however, if the Company terminates the Grantee's employment
without cause, other than due to disability or incapacity, (A) prior to the
third anniversary of the Employment Date, the Grantee shall immediately vest in
twenty (20%) of the Restricted Stock and 20% of the dividends that have been
accumulated in  Section 2(b) or (B) prior to the fifth anniversary of
the Employment Date, the Grantee shall immediately vest in twenty percent (20%)
of the unvested portion of the Restricted Stock and 20% of the dividends that
have been accumulated in  Section 2(b).





Restricted
Stock forfeited pursuant tothis Section 2(f) shall
be transferred to, and reacquired by, the Company without payment of any
consideration by the Company, and neither the Grantee nor any of the Grantee's
successors, heirs, assigns, personal representatives or other transferees shall
thereafter have any further rights or interests in such shares or
certificates.  If certificates containing restrictive legends shall
have theretofore been delivered to the Grantee (or his/her legatees, personal
representative or other transferee), such certificates shall be returned to the
Company, complete with any necessary signatures or instruments of
transfer.





(g)           Change in
Control.  In the event of a change of control of the Company
(as defined below) said vesting of the Restricted Stock shall be accelerated and
restrictions shall lapse no later than immediately prior to the change of
control being consummated.  For purposes of this section, change of
control shall be deemed to have occurred in the event that the Board of
Directors of the Company in its sole discretion determines that a change of
control has occurred for the purpose of this Agreement.





(h)           Income Taxes.  The
Grantee shall pay to the Company promptly upon request and in any event at the
time the Grantee recognizes taxable income in respect of the Restricted Stock
(or, if the Grantee makes an election under Section 83(b) of the Code, in
connection with such grant), an amount equal to the taxes the Company determines
it is required to withhold under applicable tax laws with respect to the
Restricted Stock.  Such payment shall be made in the form of cash,
shares of Stock already owned by the Grantee, shares of Stock otherwise issuable
upon the lapse of restrictions, or in a combination of such
methods.  The Grantee shall promptly notify the Company of any
election made pursuant to Section 83(b) of the Code.





Section
3.                      Miscellaneous





(a)           Notices.  Any and
all notices, designations, consents, offers, acceptances and any other
communications provided for herein shall be given in writing and shall be
delivered either personally or by registered or certified mail, postage prepaid,
which shall be addressed, in the case of the Company to the General Counsel at
the principal office of the Company and, in the case of the Grantee, to
Grantee's address appearing on the books of the Company or to the Grantee's
residence or to such other address as may be designated in writing by the
Grantee.





(b)           No Right to Continued
Employment.  Nothing in this Agreement shall confer upon the
Grantee any right to continue in the employ of or to continue as an independent
contractor of the Company or any subsidiary or shall interfere with or restrict
in any way the right of the Company, which is hereby expressly reserved, to
remove, terminate or discharge the Grantee at any time for any reason
whatsoever, with or without Cause.





(c)           Successors.  The
terms of this Agreement shall be binding upon and inure to the benefit of the
Company, its successors and assigns, and of the Grantee and the beneficiaries,
executors, administrators, heirs and successors of the Grantee.





(d)           Invalid
Provision.  The invalidity or unenforceability of any
particular provision thereof shall not affect the other provisions hereof, and
this Agreement shall be construed in all respects as if such invalid or
unenforceable provision had been omitted.





(e)           Modifications.No change,
modification or waiver of any provision of this Agreement shall be valid unless
the same be in writing and signed by the parties hereto.





(f)           Entire
Agreement.  This Agreement and the Plan contain the entire
agreement and understanding of the parties hereto with respect to the subject
matter contained herein and therein and supersede all prior agreements,
communications, representations and negotiations in respect
thereto.





(g)           Governing
Law.  This Agreement and the rights of the Grantee hereunder
shall be construed and determined in accordance with the laws of the State of
New York.





(h)           Headings.The headings of the
Sections hereof are provided for convenience only and are not to serve as a
basis for interpretation or construction, and shall not constitute a part, of
this Agreement.





(i)           Counterparts.  This
Agreement may be executed in counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.





IN
WITNESS WHEREOF, this Agreement has been executed and delivered by the parties
hereto as of the day of March 20, 2009.





TETON
ADVISORS, INC.








By: /s/ Bruce N. Alpert


Bruce N.
Alpert


Chairman








NICHOLAS
F. GALLUCCIO





By: /s/ Nicholas F. Galluccio


Nicholas
F. Galluccio