PORTEC RAIL PRODUCTS, INC.
2006 STOCK OPTION PLAN
FORM OF
STOCK OPTION AGREEMENT
A. STOCK OPTIONS ("Options") for a total of __________ shares of Common
Stock, par value $1.00 per share, of Portec Rail Products, Inc. (the "Company")
are hereby granted to _______________ (the "Participant"). The grant and terms
of the Options shall be subject in all respects to the Portec Rail Products,
Inc. 2006 Stock Option Plan (the "Plan"). The terms of this Stock Option
Agreement are subject to the terms and conditions of the Plan.
B. The Option exercise price of the Common Stock is $_________ per share,
the Fair Market Value (as defined in the Plan) of the Common Stock on
____________ __, 200__, the date of grant.
C. The Options granted hereunder shall vest in ________ (__) equal annual
installments, with the first installment becoming exercisable on the first
anniversary of the date of grant, or __________ __, 200__, and succeeding
installments on each anniversary thereafter through ____________ __, 20__. The
Options granted hereunder may be exercised for up to ten (10) years from the
date of grant, subject to sub-paragraph E below.
D. All Options granted to the Participant shall be deemed to be Incentive
Stock Options to the extent permitted under the Internal Revenue Code and
regulations.
E. If the Participant terminates Continuous Service (as defined in the
Plan) with the Company or an Affiliate (as defined in the Plan) for any reason
other than Disability (as defined in the Plan), death, Termination for Cause (as
defined in the Plan) or termination following a Change in Control (as defined in
the Plan), other than for Cause following a Change in Control, Options will be
exercisable only as to those Options which have vested at the time of such
termination and will be exercisable for a period of up to three (3) months
following such termination. If the Participant terminates Continuous Service
with the Company or an Affiliate due to death, Disability, or following a Change
in Control, Options granted hereunder, whether or not vested at such time, will
vest and become exercisable by the Participant (or his/her legal representative
or beneficiary) for one (1) year following the date of such termination of
Continuous Service; provided, however, except in the case of death or
Disability, such Options shall not be eligible for treatment as Incentive Stock
Options in the event such Options are exercised more than three (3) months
following termination. In order to obtain Incentive Stock Option treatment for
an Option exercised by the heirs or devisees of the Participant, the death of
the Participant must have occurred while the Participant was employed by the
Company or an Affiliate, or within three (3) months of the Participant's
termination of Continuous Service. In no event will the period of exercise
extend beyond the expiration of the Option term. In the event of Termination for
Cause, all rights under the Options will expire upon termination.
F. Options may not be exercised if the issuance of shares of Common Stock
of the Company upon such exercise would constitute a violation of any applicable
federal or state securities or other law or regulation. The Participant, as a
condition to exercise of the Options, shall represent to the Company that the
shares of Common Stock of the Company that he/she acquires pursuant to such
exercise are being acquired by such Participant for investment and not with a
present view to distribution or resale, unless counsel for the Company is then
of the opinion that such a representation is not required under the Securities
Act of 1933 or any other applicable law, regulation, or rule of any governmental
agency.
G. All Options granted to the Participant as Incentive Stock Options may
not be transferred in any manner otherwise than by will or the laws of intestate
succession, and may be exercised during the lifetime of the Participant only by
such Participant.
H. A copy of the Plan has been provided to the Participant. The Participant
is not required to exercise the Options as to any particular number of shares at
one time, but the Options must be exercised, if at all and to the extent
exercised, by no later than ten years from the date of grant. The Options may be
exercised during such term only in accordance with the terms of the Plan. In the
event of any inconsistency between this Agreement and the Plan, the terms of the
Plan will control.
I. All exercises of the Options must be made by executing and returning the
Notice of Exercise of Stock Options attached hereto as Exhibit A, and upon
receipt of any shares of Common Stock upon the exercise of any Options, the
recipient shall complete and return to the Company the Acknowledgment of Receipt
of Stock Option Shares attached hereto as Exhibit X.
X. This Agreement shall not be deemed to constitute a contract of
employment between the parties hereto, nor shall any provision hereof restrict
the right of the Company to discharge the Participant or restrict the right of
the Participant to terminate his employment.
K. The Participant acknowledges receipt of a copy of the Portec Rail
Products, Inc. 2006 Stock Option Plan and represents that he is familiar with
the terms and provisions thereof. The Participant hereby accepts the Options
subject to all the terms and provisions of such Plan. The Participant hereby
agrees to accept as binding, conclusive, and final all decisions and
interpretations of the Committee established to administer such Plan upon any
questions arising under such Plan.
Date: __________ __, 200__
ATTEST: PORTEC RAIL PRODUCTS, INC.
___________________________ _________________________________
WITNESS: PARTICIPANT
___________________________ _________________________________
This Stock Option Agreement must be executed in duplicate originals,
with one original retained by the Company and one original
retained by the Participant
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