**Exhibit 10.4**

 

**EXECUTION COPY**

 

**AVENTINE RENEWABLE ENERGY HOLDINGS, INC.**

**2010 EQUITY INCENTIVE PLAN**

**RESTRICTED STOCK AWARD AGREEMENT**

 

ThisRestricted Stock Award Agreement (the “***Agreement***”)is made, effective as of the 5th day of May, 2010 (the “***Dateof Grant***”), by and between Aventine Renewable Energy Holdings, Inc.(the****“***Company***”)and John Castle (the “***Participant***”).

 

**RECITALS:**

 

**WHEREAS**, the Company has adopted the Aventine RenewableEnergy Holdings, Inc.  (the *“**Plan**”*) pursuant to whichawards of restricted common shares of the Company (***“CommonShares”***) may be granted; and

 

**WHEREAS**, the Committee has determined that it is in thebest interests of the Company and its shareholders to grant the award ofrestricted Common Shares provided for herein (the *“**Restricted Stock Award**”*) to the Participant inrecognition of the Participant’s services to the Company, such grant to besubject to the terms set forth herein.

 

**NOW, THEREFORE,** in consideration for the mutual covenantshereinafter set forth, the parties hereto agree as follows:

 

1.                                       **Grantof Restricted Stock Award****. **Pursuant to Section 9 of the****Plan, theCompany hereby issues to the Participant on the Date of Grant a RestrictedStock Award consisting of, in the aggregate, 25,000 Common Shares in thecapital of the Company (hereinafter called the “***RestrictedStock***”).

 

2.                                       **Incorporationby Reference**.  Theprovisions of the Plan are hereby incorporated herein by reference.  Except as otherwise expressly set forthherein, this Agreement shall be construed in accordance with the provisions ofthe Plan and any capitalized terms not otherwise defined in this Agreementshall have the definitions set forth in the Plan.

 

3.                                       **Restrictions**.  Except as provided in the Plan or thisAgreement, the restrictions on the Restricted Stock are that the Participantmay not sell, assign, transfer, hypothecate, pledge or otherwise alienate theRestricted Stock.

 

4.                                       **Vesting****.**

 

(a)                                  Therestrictions described in Section 3 of this Agreement will lapse withrespect to (i) 4,167 shares of the Restricted Stock on each of the firsttwo anniversaries of the Date of Grant, (ii) 4,166 shares of theRestricted Stock on December 31, 2012, and (iii) the remaining 12,500shares of the Restricted Stock subject to the attainment of reasonableperformance criteria to be determined by the Board, and once so determined willbe set forth on Annex A hereto; provided, that, theParticipant is then employed by the Company. Except as set forth in Section 

 

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4(b), any unvestedRestricted Stock shall be forfeited without consideration upon the terminationof the Participant’s employment for any reason.

 

(b)                                 Notwithstandingthe foregoing, in the event that the Participant’s employment with the Companyis terminated (i) by the Company without Cause (as defined in theEmployment Agreement between the Company and the Participant dated as of May 5,2010 (the “***Employment Agreement***”)), or (ii) bythe Participant for Good Reason (as defined in the Employment Agreement), therestrictions described in Section 3 of this Agreement shall lapse and allRestricted Stock shall automatically become vested and immediatelynonforfeitable in full.

 

(c)                                  Change in Control.  Upon the occurrence of a Change in Control(as defined in the Employment Agreement), the restrictions described in Section 3of this Agreement shall lapse and all Restricted Stock shall automaticallybecome vested and immediately nonforfeitable in full.

 

5.                                       **Tax Withholding****.** In the eventthat the Company determines that tax withholding is required with respect tothe Participant, the Participant shall be required to pay to the Company, andthe Company shall have the right to deduct from any compensation paid to theParticipant pursuant to the Plan, the amount of any required withholding taxesin respect of the Restricted Stock Award and to take such other action as theCommittee deems necessary to satisfy all obligations for the payment of suchwithholding and taxes.  The Committee maypermit the Participant to satisfy the withholding liability: (a) in cash,(b) by having the Company withhold from the number of Common Sharesotherwise issuable or deliverable pursuant to the settlement of the RestrictedStock Award a number of shares with a Fair Market Value equal to the minimumwithholding obligation, (c) by delivering Common Shares owned by theParticipant that are Mature Shares, or (d) by a combination of any suchmethods.  For purposes hereof, CommonShares shall be valued at Fair Market Value.

 

6.                                       **Rightsas Shareholder; Dividends**.  The Participant shall be the record owner ofthe Restricted Shares unless and until such Common Shares are sold or otherwisedisposed of, and as record owner shall be entitled to all rights of ashareholder of the Company, including, without limitation, voting rights, ifany, with respect to the Restricted Shares and the right to receive dividends,if any, at the time paid to other stockholders, while the Restricted Shares areheld in custody.

 

7.                                       **Compliancewith Laws and Regulations****.** The issuance and transferof Common Shares shall be subject to compliance by the Company and theParticipant with all applicable requirements of securities laws and with allapplicable requirements of any stock exchange on which the Company’s CommonShares may be listed at the time of such issuance or transfer.

 

8.                                       **NoRight to Continued Employment**.  Nothing in this Agreement shall be deemed byimplication or otherwise to impose any limitation on any right of the Companyto terminate the Participant’s employment at any time.

 

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9.                                       **Notice**.  Every notice or other communication relatingto this Agreement shall be in writing, and shall be mailed to or delivered tothe party for whom it is intended at such address as may from time to time bedesignated by it in a notice mailed or delivered to the other party as hereinprovided; provided, that, unless and until some other address beso designated, all notices or communications by the Participant to the Companyshall be mailed or delivered to the Company at its principal executive office,and all notices or communications by the Company to the Participant may begiven to the Participant personally or may be mailed to him at his address asrecorded in the records of the Company

 

10.                                 **Boundby Plan**.  By signingthis Agreement, the Participant acknowledges that he has received a copy of thePlan and has had an opportunity to review the Plan and agrees to be bound byall of the terms and provisions of the Plan. Notwithstanding anything herein or in the Plan to the contrary, theprovisions of Section 15 of the Plan shall not apply to the Participant.

 

11.                                 **Beneficiary**.  The Participant may file with the Committee awritten designation of a beneficiary on such form as may be prescribed by theCommittee and may, from time to time, amend or revoke such designation.  If no designated beneficiary survives theParticipant, the executor or administrator of the Participant’s estate shall bedeemed to be the Participant’s beneficiary.

 

12.                                 **Successors**.  The terms of this Agreement shall be bindingupon and inure to the benefit of the Company, its successors and assigns, andon the Participant and the beneficiaries, executors and administrators, heirsand successors of the Participant.

 

13.                                 **Amendmentof Restricted Stock Award**.  Subject to Section 14 of this Agreement,the Committee at any time and from time to time may amend the terms of thisRestricted Stock Award; provided, however, the Participant’srights under this Restricted Stock Award shall not be adversely affected by anysuch amendment without the Participant’s consent.

 

14.                                 **Adjustments**.  In the event of any adjustment pursuant to Section 12of the Plan that would adversely affect the value of the Restricted Stock Awardgranted hereunder or cause such Restricted Stock Award to become subject to Section 409Aof the Code, such adjustment may only be made with the Participant’s writtenconsent, which consent shall not be unreasonably withheld.

 

15.                                 **GoverningLaw; Modification**.  ThisAgreement shall be governed by the laws of the state of New York without regardto the conflict of law principles.  TheAgreement may not be modified except in writing signed by both parties.

 

16.                                 **Interpretation**.  Any dispute regarding the interpretation ofthis Agreement shall be submitted by the Participant or the Company to theCommittee for review.  The resolution ofsuch a dispute by the Committee shall be binding on the Company and theParticipant.

 

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17.                                 **Severability**.  Every provision of this Agreement is intendedto be severable and any illegal or invalid term shall not affect the validityor legality of the remaining terms.

 

18.                                 **Headings**.  The headings of the Sections hereof areprovided for convenience only and are not to serve as a basis forinterpretation of construction, and shall not constitute a part of thisAgreement.

 

19.                                 **Signaturein Counterparts**.  ThisAgreement may be signed in counterparts, each of which shall be deemed anoriginal, with the same effect as if the signatures thereto and hereto wereupon the same instrument.

 

**[signature page follows]**

 

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INWITNESS WHEREOF, the parties hereto have signed this Agreement as of the datefirst set forth above.

 
|   |   | **AVENTINE  RENEWABLE ENERGY HOLDINGS, INC.** |
|--------|--------|----------------------------------------------------|
|   |   |                                               |
|   |   |                                               |
|   |   | By:                                                | /s/  Thomas Manuel |
|   |   |                                               | Name:  Thomas Manuel |
|   |   |                                               | Title:  Chief Executive Officer |
|   |   |                                               |
|   |   |                                               |
|   |   | **PARTICIPANT**                                    |
|   |   |                                               |
|   |   |                                               |
|   |   | By:                                                | /s/  John Castle |
|   |   |                                               |  Name:  John Castle |

 

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**EXECUTION COPY**

 

**ANNEX A**

 

**[PERFORMANCE CRITERIA]**

 

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