Document:

Exhibit 10.6

 

RESTRICTED STOCK AWARD
AGREEMENT

Quanex
Corporation

1996
Employee Stock Option and Restricted Stock Plan

 

This RESTRICTED STOCK AWARD
AGREEMENT (the “Agreement”) is
made by and between Quanex Corporation, a Delaware corporation, (the “Company”) and                          
(the “Executive”) on this          
day of                     ,
200    ( the “Grant Date”)
pursuant to the Quanex Corporation 1996 Employee Stock Option and Restricted
Stock Plan (the “Plan”), which is incorporated by
reference herein in its entirety.

 

WHEREAS, the Company desires to grant to the
Executive the shares of equity securities specified herein (the “Shares”), subject to the terms and conditions of this
Agreement; and

 

WHEREAS, the Executive desires to have the opportunity
to hold Shares subject to the terms and conditions of this Agreement;

 

NOW, THEREFORE, in consideration of the premises,
mutual covenants and agreements contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto, intending to be legally bound hereby, agree as follows:

 

1.                                      Definitions.  For purposes
of this Agreement, the following terms shall have the meanings indicated:

 

(a)                                  “Forfeiture Restrictions”
shall mean any prohibitions and restrictions set forth herein with respect to
the sale or other disposition of Shares issued to the Executive hereunder and
the obligation to forfeit and surrender such shares to the Company.

 

(b)                                 “Restricted Shares”
shall mean Shares that are subject to the Forfeiture Restrictions under this
Agreement.

 

Capitalized terms
not otherwise defined in this Agreement shall have the meanings given to such
terms in the Plan.

 

2.                                      Grant of Restricted Shares.  On the date of
this Agreement, the Company shall cause to be issued in the Executive’s name
the following Shares as Restricted Shares:            
shares of the Company’s Common Stock, $.50 par value.  The Company shall cause certificates
evidencing the Restricted Shares to be issued in the Executive’s name, pursuant
to which the Executive shall have, except for the Forfeiture Restrictions, all
of the rights of a stockholder with respect to such Restricted Shares,
including, without limitation, the right to receive any dividends or
distributions allocable thereto and all voting rights appurtenant thereto.  Upon issuance the certificates shall be
delivered to the Secretary of the Company or to such other depository as may be
designated by the Committee under the Plan as a depository for safekeeping
until the forfeiture of such Restricted Shares occurs or the Forfeiture
Restrictions lapse.  On the date of this
Agreement, the Executive shall deliver to the Company all stock powers,
endorsed in blank, relating to the Restricted Shares.  In accepting this award of Shares the
Executive accepts and agrees to be bound by all the terms and conditions of the
Plan.

 

 

3.                                      Transfer Restrictions.  The Shares
granted hereby may not be sold, assigned, pledged, exchanged, hypothecated or
otherwise transferred, encumbered or disposed of (other than by will or the
applicable laws of descent and distribution) to the extent then subject to the
Forfeiture Restrictions.  Any such
attempted sale, assignment, pledge, exchange, hypothecation, transfer,
encumbrance or disposition in violation of this Agreement shall be void and no
company shall be bound thereby.  Further,
the Shares granted hereby that are no longer subject to Forfeiture Restrictions
may not be sold or otherwise disposed of in any manner which would constitute a
violation of any applicable federal or state securities laws.  The Executive also agrees (i) that the
Company may refuse to cause the transfer of the Restricted Shares to be
registered on the applicable stock transfer records if such proposed transfer would
in the opinion of counsel satisfactory to the Company constitute a violation of
any applicable securities law and (ii) that the Company may give related
instructions to the transfer agent, if any, to stop registration of the
transfer of the Restricted Shares.

 

4.                                      Vesting.  The Shares
that are granted hereby shall be subject to Forfeiture Restrictions.  The Forfeiture Restrictions shall lapse as to
the Shares that are granted hereby on the earlier of (a) the third
anniversary of the Grant Date or (b) the date a Change in Control of the
Company occurs, provided that the Executive’s employment with the Company has
not terminated prior to such date. 
However, in the event the Executive’s employment relationship with the
Company is terminated due to the death, Disability or Retirement of the
Executive prior to the earlier of the third anniversary of the Grant Date or
the date a Change in Control of the Company occurs, the Forfeiture Restrictions
shall lapse as to the Shares that are granted hereby on the date the Executive’s
employment relationship with the Company is terminated due to the death,
Disability or Retirement of the Executive. 
If the Executive’s employment relationship with the Company terminates
before the earlier of the third anniversary of the Grant Date or the date a
Change in Control of the Company occurs, except as specified in the preceding
sentence, the Forfeiture Restrictions then applicable to the Restricted Shares
shall not lapse and all the Restricted Shares shall be forfeited to the Company.  For purposes of this Section 4, the term
“Change in Control” shall have the
meaning ascribed to that term in the individual change in control agreement
between the Company and the Executive in effect on the Grant Date.  Upon the lapse of the Forfeiture Restrictions
with respect to Shares granted hereby the Company shall cause to be delivered
to the Executive a stock certificate representing such Shares, and such Shares
shall be transferable by the Executive (except to the extent that any proposed transfer
would, in the opinion of counsel satisfactory to the Company, constitute a
violation of applicable securities law). 
Notwithstanding any other provision of this Agreement, in no event will
the Forfeiture Restrictions expire prior to the satisfaction by the Executive
of any liability arising under Section 6 of this Agreement.

 

5.                                      Capital Adjustments and
Reorganizations.  The existence of the Restricted Shares shall
not affect in any way the right or power of the Company or any company the
stock of which is awarded pursuant to this Agreement to make or authorize any
adjustment, recapitalization, reorganization or other change in its capital
structure or its business, engage in any merger or consolidation, issue any
debt or equity securities, dissolve or liquidate, or sell, lease, exchange or
otherwise dispose of all or any part of its assets or business, or engage in
any other corporate act or proceeding.

 

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6.                                      Tax Withholding.  To the extent
that the receipt of the Restricted Shares or the lapse of any Forfeiture
Restrictions results in income to the Executive for federal, state or local
income or employment tax purposes with respect to which the Company has a withholding
obligation, the Executive shall deliver to the Company at the time of such
receipt or lapse, as the case may be, such amount of money as the Company may
require to meet its obligation under applicable tax laws or regulations, and,
if the Executive fails to do so, the Company is authorized to withhold from the
Shares granted hereby or from any cash or stock remuneration then or thereafter
payable to the Executive any tax required to be withheld by reason of such
resulting income.

 

7.                                      Employment Relationship.  For purposes
of this Agreement, the Executive shall be considered to be in the employment of
the Company as long as the Executive has an employment relationship with the
Company.  The Committee shall determine
any questions as to whether and when there has been a termination of such employment
relationship, and the cause of such termination, under the Plan and the
Committee’s determination shall be final and binding on all persons.

 

8.                                      Section 83(b)
Election.  The Executive shall not exercise the election
permitted under section 83(b) of the Internal Revenue Code of 1986, as
amended, with respect to the Restricted Shares without the written approval of
the Chief Financial Officer of the Company. 
If the Chief Financial Officer of the Company permits the election, the
Executive shall timely pay the Company the amount necessary to satisfy the
Company’s attendant tax withholding obligations, if any.

 

9.                                      No Fractional Shares.  All provisions
of this Agreement concern whole Shares. 
If the application of any provision hereunder would yield a fractional
share, such fractional share shall be rounded down to the next whole share if
it is less than 0.5 and rounded up to the next whole share if it is 0.5 or
more.

 

10.                               Not an Employment
Agreement.  This Agreement is not an employment
agreement, and no provision of this Agreement shall be construed or interpreted
to create an employment relationship between the Executive and the Company or
guarantee the right to remain employed by the Company for any specified term.

 

11.                               Legend. 
If the Executive is an officer or affiliate of the Corporation under the
Securities Act of 1933, the Executive consents to the placing on the
certificate for the Shares of an appropriate legend restricting resale or other
transfer of the Shares except in accordance with such Act and all applicable
rules thereunder.

 

12.                               Notices.  Any notice,
instruction, authorization, request or demand required hereunder shall be in
writing, and shall be delivered either by personal delivery, by telegram,
telex, telecopy or similar facsimile means, by certified or registered mail,
return receipt requested, or by courier or delivery service, addressed to the
Company at the address indicated beneath its signature on the execution page of
this Agreement, and to the Executive at the Executive’s residential address
indicated beneath the Executive’s signature on the execution page of this
Agreement, or at such other address and number as a party shall have previously
designated by written notice given to the other party in the manner hereinabove
set forth.  Notices shall be deemed given
when received, if sent by facsimile means (confirmation of such receipt by

 

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confirmed facsimile transmission being deemed receipt
of communications sent by facsimile means); and when delivered (or upon the
date of attempted delivery where delivery is refused), if hand-delivered, sent
by express courier or delivery service, or sent by certified or registered
mail, return receipt requested.

 

13.                               Amendment and Waiver.  This Agreement
may be amended, modified or superseded only by written instrument executed by
the Company and the Executive.  Only a
written instrument executed and delivered by the party waiving compliance
hereof shall make any waiver of the terms or conditions.  Any waiver granted by the Company shall be
effective only if executed and delivered by a duly authorized executive officer
of the Company other than the Executive. 
The failure of any party at any time or times to require performance of
any provisions hereof shall in no manner effect the right to enforce the
same.  No waiver by any party of any term
or condition, or the breach of any term or condition contained in this
Agreement, in one or more instances, shall be construed as a continuing waiver
of any such condition or breach, a waiver of any other condition, or the breach
of any other term or condition.

 

14.                               Governing Law and
Severability.  This Agreement shall be governed by the laws
of the State of Texas without regard to its conflicts of law provisions.  The invalidity of any provision of this
Agreement shall not affect any other provision of this Agreement, which shall
remain in full force and effect.

 

15.                               Successors and Assigns.  Subject to the
limitations which this Agreement imposes upon the transferability of the Shares
granted hereby, this Agreement shall bind, be enforceable by and inure to the
benefit of the Company and its successors and assigns, and to the Executive,
the Executive’s permitted assigns and upon the Executive’s death, the Executive’s
estate and beneficiaries thereof (whether by will or the laws of descent and
distribution), executors, administrators, agents, legal and personal
representatives.

 

16.                               Counterparts.  This Agreement
may be executed in two or more counterparts, each of which shall be an original
for all purposes but all of which taken together shall constitute but one and
the same instrument.

 

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IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed by an officer thereunto duly authorized, and the Executive has
executed this Agreement, all as of the date first above written.

 

 

	
   

  	
  QUANEX CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
							

 

 

IRREVOCABLE STOCK POWER

 

KNOW ALL MEN BY THESE PRESENTS, That the undersigned, For
Value Received, has bargained, sold, assigned and transferred
and by these presents does bargain, sell, assign and transfer unto Quanex
Corporation, a Delaware corporation (the “Company”), the
Shares transferred pursuant to the Restricted Stock Agreement dated                         
between the Company and the undersigned ; and subject
to and in accordance with such Restricted Stock Agreement the undersigned does
hereby constitute and appoint                             
the undersigned’s true and lawful attorney, IRREVOCABLY, to sell assign,
transfer, hypothecate, pledge and make over all or any part of such Shares and
for that purpose to make and execute all necessary acts of assignment and
transfer thereof, and to substitute one or more persons with like full power,
hereby ratifying and confirming all that said attorney or his substitutes shall
lawfully do by virtue hereof.

 

In Witness Whereof, the undersigned has executed this Irrevocable
Stock Power on this              
day of                              .Exhibit
10.7

 

NONQUALIFIED STOCK OPTION
AGREEMENT

Quanex Corporation

1996 Employee Stock Option
and Restricted Stock Plan

 

 

This STOCK OPTION
AGREEMENT (the “Agreement”) is made between QUANEX
CORPORATION, a Delaware corporation (the “Company”), and                         
(the “Optionee”).  The Board of Directors
of the Company has adopted the Quanex Corporation 1996 Employee Stock Option
and Restricted Stock Plan (the “Plan”), which is incorporated by reference
herein.  The Company considers that its
interests will be served by granting the Optionee an option to purchase shares
of common stock of the Company as an inducement for [his] [her] continued and
effective performance of services for the Company or an Affiliate.  Any term used in this Agreement that is not
specifically defined herein shall have the meaning specified in the Plan.

 

IT IS
AGREED:

 

1.             Subject to the terms of the Plan
and this Agreement, on                               ,
200   (the “Date of Grant”), the Company hereby grants to the Optionee
a nonqualified stock option (the “Option”) to purchase                          
shares of the common stock of the Company, $.50 par value per share, at a price
of
$                    
per share, subject to adjustment as provided in the Plan.  The Option is exercisable in accordance with
the following schedule:

 

(a)           on the day after the first
anniversary of the Date of Grant, the Option may be exercised with respect to
up to 1/3 of the shares subject to the Option;

 

(b)           after each succeeding anniversary of
the Date of Grant, the Option may be exercised with respect to up to an
additional 1/3 of the shares subject to the Option, so that after the
expiration of the third anniversary of the Date of Grant the Option shall be
exercisable in full; and

 

(c)           to the extent not exercised,
installments shall be cumulative and may be exercised in whole or in part.

 

However, the Option shall
be exercisable in full on the date a Change in Control occurs, provided that
the Optionee’s employment with the Company has not terminated prior to such
date.  For purposes of this Section 1,
the term “Change in Control” shall have the
meaning ascribed to that term in the individual change in control agreement
between the Company and the Optionee in effect on the Date of Grant.

 

2.             Except as specified below, the
Option granted to the Optionee under this Agreement shall not be transferable
or assignable by the Optionee other than by will or the laws of descent and
distribution, and shall be exercisable during the Optionee’s lifetime only by
[him] [her].  The Optionee may transfer
this Option to a member or members of [his] [her] immediate family, a trust
under which [his] [her] immediate family members are the only beneficiaries and
a partnership of which [his] [her] immediate family members are the only
partners.  For this purpose, “immediate
family” means the Optionee’s spouse, children, stepchildren, grandchildren,

 

 

parents, grandparents,
siblings (including half brothers and sisters), and individuals who are family
members by adoption.  Notwithstanding any
other provision of this Agreement, such a transferee of the Option granted
under this Agreement may exercise the Option during the Optionee’s
lifetime.  None of the Company, its
employees or directors makes any representations or guarantees concerning the
tax consequences associated with the inclusion of this provision in this
Agreement, the Optionee’s transfer of the Option granted under this Agreement
or transferee’s exercise of the Option. 
It is the sole responsibility of the Optionee to seek advice from [his]
[her] own tax advisors concerning those tax consequences.  The Optionee is entitled to rely upon only
the tax advice of his own tax advisors.

 

3.             The Option shall terminate and
become null and void on the earliest of (a) the last day of the ten year
period commencing on the Date of Grant, (b) the last day of the
three-month period commencing on the date of the severance of the employment
relationship between the Optionee and the Company and all Affiliates for any
reason other than death, Disability or Retirement, or (c) the last day of the
three-year period commencing o the date of the severance of the employment
relationship between the Optionee and the Company and all Affiliates due to
death, Disability or Retirement.  In the
event of the Optionee’s severance of the employment relationship between the
Employee and the Company and all Affiliates for any reason other than death,
Disability or Retirement, the Option shall not continue to vest after such
severance of employment.  In the event of
the severance of the employment relationship between the Employee and all
Affiliates due to the death, Disability or Retirement of the Optionee, the
Option shall continue to vest after such severance of employment until the
expiration of the Option.

 

Upon the death of the
Optionee prior to the expiration of [his] [her] Option, [his] [her] executors,
administrators or any person or persons to whom [his] [her] Option may be
transferred by will or by the laws of descent and distribution, shall have the
right, at any time prior to the expiration date of the Option to exercise the
Option with respect to the number of shares that the Optionee would have been
entitled to exercise if [he] [she] were still alive.

 

4.             This Agreement may not be changed
or terminated orally but only by an agreement in writing signed by the party
against whom enforcement of any such change or termination is sought.

 

5.             The Company shall not be deemed by
the grant of the Option (as distinguished from a separate employment agreement
or service contract, if any) to be required to retain the services of the
Optionee for any period.

 

6.             The Optionee shall not have any
rights as a stockholder with respect to any shares covered by the Option until
the date of the issuance of the stock certificate or certificates to [him]
[her] for such shares following his exercise of the Option pursuant to its
terms and conditions and payment for the shares.  No adjustment shall be made for dividends or
other rights for which the record date is prior to the date such certificate or
certificates are issued.

 

7.             The Optionee consents to the
placing on the certificate for any shares covered by the Option of an
appropriate legend restricting resale or other transfer of such shares except
in accordance with the Securities Act of 1933 and all applicable rules
thereunder.

 

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8.             In the event of any difference of
opinion concerning the meaning or effect of the Plan or this Agreement, such
difference shall be resolved by the committee referred to in the Plan.

 

9.             The validity, construction and
performance of this agreement shall be governed by the laws of the State of
Texas.  Any invalidity of any provision
of this Agreement shall not affect the validity of any other provision.

 

10.           All offers, notices, demands,
requests, acceptances or other communications hereunder shall be in writing and
shall be deemed to have been duly made or given if mailed by registered or
certified mail, return receipt requested. 
Any such notice mailed to the Company shall be addressed to its
principal office, and any notice mailed to the Optionee shall be addressed to
the Optionee’s residence address as it appears on the books and records of the
Company or to such other address as either party may hereafter designate in writing
to the other.

 

11.           This Agreement shall, except as
herein stated to the contrary, inure to the benefit of and bind the legal
representatives, successors and assigns of the parties hereto.

 

12.           This Option is a nonqualified stock
option which is not intended to be governed by section 422 of the Internal
Revenue Code of 1986, as amended.

 

13.           In accepting this Option, the
Optionee accepts and agrees to be bound by all the terms and conditions of the
Plan which pertain to nonqualified stock options granted under the Plan.

 

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IN WITNESS WHEREOF, this Agreement has been duly executed
and delivered to be effective as of the day and year first above written.

 

 

	
   

  	
  QUANEX CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Raymond A. Jean

  
	
   

  	
   

  	
  Chairman, President and CEO

  
	
   

  	
   

  
	
  Accepted:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Optionee

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date

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