Document:

Exhibit 10.3

AEP INDUSTRIES INC.

Restricted Stock Grant Certificate

Under 2005 Stock Option Plan

Date of
Grant:                       

Name of
Employee: 
                        

Grant
Amount: 
                        

This
is to certify that, effective on the date of grant specified above, the Board
of Directors/Compensation Committee of AEP Industries Inc. (the “Company”) has
granted to the above-named employee (the “Employee”) the number of shares of
Common Stock, $.01 par value per share, of the Company (the “Stock”) set forth
above pursuant to the Company’s 2005 Stock Option Plan (the “Plan”).

The
terms and conditions of the award granted hereby, in addition to the terms and
conditions contained in the Plan, are as follows:

1.    As used herein, the following terms shall
have the following meanings:

“Adjusted
Grant Amount” shall mean the actual number of shares of Stock granted to the
Employee pursuant to this Agreement (rounded to the nearest whole share), as
finally determined as of the end of the current fiscal year of the Company as
follows:

(i)           in the event that the Company’s
actual EBITDA for such fiscal year equals or exceeds Forecasted EBITDA for such
fiscal year, the Adjusted Grant Amount shall mean the Grant Amount set forth
above;

(ii)          in the event that the Company’s actual
EBITDA for such fiscal year is less than Forecasted EBITDA for such fiscal
year, but is not less than eighty percent (80%) of such forecast, the Adjusted
Grant Amount shall mean the Grant Amount set forth above, reduced by the same
percentage by which actual EBITDA is lower than Forecasted EBITDA for such
fiscal year; or

(ii)          in the event that the Company’s actual
EBITDA for such fiscal year is less than eighty percent (80%) of Forecasted
EBITDA, the Adjusted Grant Amount shall be zero.

“Change of Control” shall have the meaning ascribed to
such term in the Plan.

“Code” shall mean
the Internal Revenue Code of 1986, as amended from time to time.

“EBITDA”
shall mean, for any fiscal year, the Company’s earnings for such fiscal year before
provision for interest, taxes, depreciation and amortization, as determined in
accordance with United States generally accepted accounting principals (“GAAP”).

“Forecasted
EBITDA” shall mean, for any fiscal year, the Company’s forecast of EBITDA for such
fiscal year, as approved by the Board of Directors of the Company and as
provided to the Employee as of the date of the grant hereunder.

“Parent” shall
have the meaning set forth in section 425(e) of the Code.

“Subsidiary” shall have the meaning set forth in
section 425(f) of the Code.

“Termination
Due to Business Divestiture” shall mean the termination of employment of the
Employee due to a transaction or series of related transactions (other than a
transaction or series of transactions that are part of a Change of Control)
that result in a divestiture, sale, transfer, assignment or other disposition
of any division, subsidiary, business unit, product line or group, or any other
asset of the Company or any of its affiliates.

 

2.    The Employee may not sell, assign, transfer,
pledge, hypothecate, mortgage or otherwise dispose of, by gift or otherwise, or
in any way encumber all or any of the Stock granted hereby until such time as
such Stock becomes vested pursuant to the provisions of this Agreement.

3.    Subject to the terms and conditions set
forth herein, the shares of Stock covered by this grant shall vest and become
deliverable only in accordance with the following schedule:

 

	
  Vesting Period

  	
   

  	
  Percentage of Adjusted Grant Amount to

  be Issued to Employee

  	
   

  
	
  Within first year from date of grant:

  	
   

  	
  0

  	
  %

  
	
  Beginning one year from date of grant:

  	
   

  	
  20

  	
  %

  
	
  Beginning two years form date of grant:

  	
   

  	
  40

  	
  %

  
	
  Beginning three years from date of grant:

  	
   

  	
  60

  	
  %

  
	
  Beginning four years from date of grant:

  	
   

  	
  80

  	
  %

  
	
  Beginning five
  years from date of grant:

  	
   

  	
  100

  	
  %

  

 

4.    The Employee shall not be entitled to any
rights as a stockholder of the Company in respect of any shares of Stock
covered by this grant until such shares of Stock become vested pursuant to the
provisions of this Agreement.

5.    At the end of each vesting period (or as
soon as practicable thereafter), the Company shall deliver a certificate or
certificates representing the shares of Stock vested as of such period to the
Employee or his designee. Such certificate shall be registered in the name of
the Employee.

6.    In the event that the Employee’s employment
as an employee of the Company or of any Parent or Subsidiary (hereinafter the “Employee’s employment”) is terminated
prior to the time that the shares of Stock granted hereby have fully vested
(other than as set forth in Section 7 below), the unvested portion of the
grant will terminate automatically and will be forfeited to the Company
immediately and without further notice.

7.    All shares of Stock granted hereunder shall
become immediately vested in the event of:

(i)           the death of the Employee;

(ii)                             the
permanent disability (within the meaning of section 22(e)(3) of the Code)
of the Employee;

(iii)         a Termination Due to Business
Divestiture; or

(iv)        a Change of Control.

In
the event that any of the foregoing occur before the end of a fiscal year, for
the purposes of determining the Adjusted Grant Amount for such Employee,  year-to-date EBITDA as of the end of the
fiscal quarter immediately preceding to date of the event shall be annualized
and compared to Forecasted EBITDA for such fiscal year.

8.    The grant of Stock hereunder shall terminate
and shall have no further force or effect in the event that the Company’s
actual EBITDA for the current fiscal year is less than eighty percent (80%) of
Forecasted EBITDA for such fiscal year.

9.    This grant does not confer on the Employee
any right to continue in the employ of the Company or interfere in any way with
the right of the Company to determine the terms of the Employee’s employment.

10.  In the event of a reorganization,
recapitalization, stock split, stock dividend, combination of shares, merger,
consolidation, rights offering, or any other change in the corporate structure
or shares of the Company, the Committee shall make such adjustments, if any, as
it deems appropriate in the number and kind of shares covered by this grant.

11.  The Company
currently has an effective registration statement on file with the Securities
and Exchange Commission with respect to the shares of Stock subject to this
grant. The Company intends to maintain this registration but has no obligation
to do so. If the registration ceases to be effective, you will not be able to
transfer or sell Stock issued to you pursuant to this grant unless an exemption
from registration under applicable securities laws is available. You agree that
any resale by you of the shares of Stock issued pursuant to this grant shall
comply in all respects with the requirements 

 

of all applicable
securities laws, rules and regulations (including, without limitation, the
provisions of the Securities Act, the Exchange Act and the respective rules and
regulations promulgated thereunder) and any other law, rule or regulation
applicable thereto, as such laws, rules, and regulations may be amended from
time to time. The Company shall not be obligated to either issue the Stock or
permit the resale of any Stock if such issuance or resale would violate any
such requirements.

 

12.  This grant and the terms and conditions herein
set forth are subject in all respects to the terms and conditions of the Plan,
which shall be controlling. All interpretations or determinations of the
Committee shall be binding and conclusive upon the Employee and his legal
representatives on any question arising hereunder or under the Plan.

13.  All notices hereunder to the Company shall be
delivered or mailed to the following address:

AEP Industries Inc.

Attention:  Secretary

125 Phillips Avenue

South Hackensack, NJ  07606

Such address may be
changed at any time provided notice of such change is furnished in advance to
the Employee.

14.  All notices hereunder to the Employee shall be
to the Employee’s address as appearing on the records of the Company.

	
  

  	
   

  	
  AEP INDUSTRIES INC.

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  SecretaryExhibit 10.4

AEP INDUSTRIES INC.

Incentive Stock Option Certificated

Under 2005 Stock Option Plan

For Options Granted After January 1, 2005

Date of Grant: 
                             

Name of Optionee:  
                           

Number of Shares:                              

Price Per Share:                               

This is to certify
that, effective on the date of grant specified above (which shall in no event
be after December 31, 2014, the Stock Option Committee (the “Committee”)
of the Board of Directors of AEP Industries Inc. (the “Company”) has granted to
the above-named optionee (the “Optionee”) an option to purchase from the
Company, for the price per share set forth above, the number of shares of
Common Stock, $.01 par value of the Company (the “Stock”) set forth above
pursuant to the AEP Industries Inc. 2005 Stock Option Plan (the “Plan”). This
option is granted pursuant to Section 6 of the Plan and shall be treated
as an “incentive stock option” within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended (the “Code”).

The terms and
conditions of the option granted hereby, in addition to the terms and
conditions contained in the Plan, are as follows:

1.    The price at which each share of Stock
subject to this option may be purchased shall be the price set forth above,
subject to any adjustments which may be made pursuant to Section 9 hereof,
provided that it shall in no event be less than the market value (as determined
pursuant to Section 4 hereof) per share of Stock on the date of grant, and
provided further that in the event the Optionee owns on the date of grant
capital stock possessing more than 10% of the total combined voting power of
all classes of capital stock of the Company or of any Parent or Subsidiary corporations
(within the meaning of Sections 425(e) and (f) of the Code and
referred to herein as “Parent” and “Subsidiary”, respectively), the price per
share shall not be less than 110% of the market value per share of Stock on the
date of grant.

2.    Subject to the terms and conditions set
forth herein, this option may be exercisable to purchase shares of Stock
covered by this option only in accordance with the following schedule:

 

	
  

  Exercise Period

  	
   

  	
  Cumulative Percentage of

  Aggregate Number of Shares

  of Stock Covered by Option

  Which May be Purchased

  	
   

  
	
  Within 1st year from date of grant:

  	
   

  	
  0

  	
  %

  
	
  Beginning one year from date of grant:

  	
   

  	
  20

  	
  %

  
	
  Beginning two years form date of grant:

  	
   

  	
  40

  	
  %

  
	
  Beginning three years from date of grant:

  	
   

  	
  60

  	
  %

  
	
  Beginning four years from date of grant:

  	
   

  	
  80

  	
  %

  
	
  Beginning five
  years from date of grant:

  	
   

  	
  100

  	
  %

  

 

less, in the case of each
exercise period, the number of shares of Stock, if any, previously purchased
hereunder. This option shall terminate and no shares of Stock may be purchased
hereunder more than ten years after the date of grant, provided 

 

that if the Optionee owns
on the date of grant capital stock possessing more than 10% of the total
combined voting power of all classes of capital stock of the Company or of any
Parent or Subsidiary, this option shall not be exercisable after the fifth
anniversary of the date of grant and shall be 100% exercisable four years and
nine months after the date of grant.

3.    Except as provided in Section 7 hereof,
this option may not be exercised unless the Optionee is in the employ of the
Company or any of its Parent or Subsidiary corporations at the time of such
exercise and shall have been such employee continuously since the date of the
grant of this option.

4.    Subject to the terms and conditions set forth
herein, the Optionee may exercise this option at any time as to all or any of
the shares of Stock then purchasable in accordance with Section 2 hereof
by delivering to the Company written notice specifying:

(i)        the number of whole shares of Stock to be
purchased together with payment in full (in a manner specified below) of the
aggregate option price of such shares, provided that this option may not be
exercised for less than one hundred shares of Stock or the number of shares of
Stock remaining subject to option, whichever is smaller;

(ii)       the name or names in which the stock
certificate or certificates are to be registered;

(iii)      the address to which dividends, notices,
reports, etc. are to be sent; and

(iv)      the Optionee’s social security number.

Only one Stock
certificate will be issued unless the Optionee otherwise requests in writing. Payment
shall be in cash, personal check or by certified or bank cashier’s check
payable to the order of the Company, free from all collection charges;
provided, however, that payment may be made in shares of Stock owned by the
Optionee having a market value on the date of exercise equal to the aggregate
purchase price, or in a combination of cash and shares of Stock. For purposes
of the Plan, the market value per share of Stock shall be the last sale regular
way on such day or if such day is not a business day on the preceding business
day, on the principal national securities exchange on which the Common Stock is
listed or admitted to trading as reported by such exchange, or if the Common
Stock is not listed or admitted to trading on any national securities exchange,
in the over-the-counter market on such day, as reported on the Nasdaq National
Market (“Nasdaq”), or if there are no such prices reported on such exchange or
Nasdaq on such day, the average of the closing high bid and low asking price of
the Stock as reported by such exchange or Nasdaq, and if there be none, then as
furnished to the Committee by any New York Stock Exchange member selected from
time to time by the Committee for such purpose. If there is no bid or asked
price reported on any such day, the market value shall be determined by the
Committee in accordance with the regulations promulgated under Section 2031
of the Code, or by any other appropriate method selected by the Committee.

In the case of an
Incentive Stock Option, if the foregoing method of determining fair market
value should be inconsistent with Section 422 of the Code, “Fair Market
Value” shall be determined by the Committee in a manner consistent with such
section of the Code and shall mean the value as so determined.

If the Optionee so
requests, shares of Stock purchased upon exercise of an option may be issued in
the name of the Optionee or another person, provided the Optionee pays all
transfer and documentary taxes, if any, resulting from such issuance. No
Optionee shall be entitled to any rights as a stockholder of the Company in
respect of any shares of Stock covered by this option until such shares of
Stock shall have been paid for in full and issued to the Optionee.

5.    As soon as practicable after the Company
receives payment for shares of Stock covered by this option, it shall deliver a
certificate or certificates representing the shares of Stock so purchased to
the Optionee or his designee. Such certificate shall be registered in the name
of the Optionee, or in such other name or names as the Optionee shall request.

6.    This option is personal to the Optionee and
during the Optionee’s lifetime may be exercised only by the Optionee. This
option shall not be transferable other than by will or the laws of descent and
distribution.

7.    In the event that the Optionee’s employment
as an employee of the Company or of any Subsidiary or Parent (hereinafter the “Optionee’s
employment”) is terminated prior to the time that this option has been fully
exercised, this option shall be exercisable, as to any remaining shares of
Stock subject hereto, only in the following circumstances:

(i)        If the Optionee’s employment is terminated
by action of his employer, or by reason of disability or retirement under any
requirement plan maintained by the Company or any Subsidiary or Parent, this
option may be exercised by the Optionee within three months after such
termination, but only as to any shares as to which this Option is exercisable
on the date the Optionee’s employment so terminates;

 

(ii)       In the event of the death of the Optionee
during the period of the Optionee’s employment, this option shall thereupon
become exercisable in full, and the person or persons to whom the Optionee’s
rights are transferred by will or the laws of descent and distribution shall
have a period of one year from the date of the Optionee’s death to exercise
such option.

Notwithstanding
the foregoing, this option shall in no event be exercisable after the date of
termination of such option specified in Section 2 hereof.

8.    This option does not confer on the Optionee
any right to continue in the employ of the Company or interfere in any way with
the right of the Company to determine the terms of the Optionee’s employment.

9.    In the event of a reorganization,
recapitalization, stock split, stock dividend, combination of shares, merger,
consolidation, rights offering, or any other change in the corporate structure
or shares of the Company, the Committee shall make such adjustments, if any, as
it deems appropriate in the number and kind of shares covered by this option,
or in the option price per share hereunder, or both.

10.  This option shall be subject to the
requirement that if at any time the Board of Directors shall determine that the
registration, listing or qualification of the shares of Stock covered hereby
upon any securities exchange or under any Federal or state law, or the consent
or approval of any governmental regulatory body is necessary or desirable as a
condition of or in connection with the granting of this option or the purchase
of shares of Stock hereunder, this option may not be exercised unless and until
such registration, listing, qualification, consent or approval shall have been
effected or obtained free of any conditions not acceptable to the Board of
Directors. The Committee may require that the person exercising this option
shall make such representations and agreement and furnish such information as
it deems appropriate to assure compliance with the foregoing or any other
applicable legal requirements.

11.  This option and the terms and conditions
herein set forth are subject in all respects to the terms and conditions of the
Plan, which shall be controlling. All interpretations or determinations of the
Committee shall be binding and conclusive upon the Optionee and his legal
representatives on any question arising hereunder or under the Plan.

12.  By acceptance of this option, the Optionee
agrees that in the event that the Optionee sells or otherwise disposes of any
shares of Stock subject to this option on or prior to (i) the date two
years from the date of the grant of this option, or (ii) the date one year
from the date of the transfer of any such shares to him pursuant to the
exercise of this option or any portion thereof, the Optionee shall promptly,
upon the occurrence of any such event (x) give notice to the Company of
the occurrence thereof, which notice shall specify the manner in which such
shares of Stock were sold or disposed of and the consideration received
therefore, and (y) furnish to the Company such other information as may
reasonably be requested by the Company.

13.  All notices hereunder to the Company shall be
delivered or mailed to the following address:

AEP Industries Inc.

Attention:  Secretary, Stock Option
Committee

125 Phillips Avenue

South Hackensack, NJ  07606

Such address for the
service of notices may be changed at any time provided notice of such change is
furnished in advance to the Optionee.

14.  All notices hereunder to the Optionee shall be
delivered or mailed to the following address:

Such address for the
service of notices may be change at any time provided notice of such change is
furnished in advance to the Company.

	
  

  	
   

  	
  AEP Industries Inc.

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Secretary

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