THE STEAK N SHAKE COMPANY Form of Incentive Stock Option Agreement
Exhibit 10.3
THE
STEAK N SHAKE COMPANY
Form
of Incentive Stock Option Agreement
THIS
AGREEMENT, made this ____
day of
_______, 20__ by and between THE STEAK N SHAKE COMPANY, an Indiana corporation
with its principal office at 00 Xxxxx Xxxxxxxxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxx
(hereinafter called "Company") and _______________________
(hereinafter called "Grantee") pursuant to the terms, conditions and limitations
contained in the Company's Employee Stock Option Plan (hereinafter called the
"Plan").
WITNESSETH
THAT:
WHEREAS,
in the interests of affording an incentive to the Grantee to give his/her best
efforts to the Company as a key employee, the Company wishes to provide that
the
Grantee shall have an option to buy shares of the common stock ("Common Stock")
of the Company:
NOW,
THEREFORE, it is hereby mutually agreed as follows:
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1.
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Grant
of Options.
The Company hereby grants to the Grantee the right and option to
purchase,
on the terms and conditions hereinafter set forth, all or any part
of an
aggregate of ______
shares (hereinafter called "Subject Shares") of the presently authorized,
but unissued, or treasury Common Stock of the Company at a purchase
price
of $_____per share, exercisable in whole or in part from time to
time
subject to the limitation that no option may be exercised with respect
to
fewer than one hundred (100) shares unless there are fewer than one
hundred (100) shares then subject to purchase hereunder, in which
event
any exercise must be as to all such shares and subject to the further
limitation that the options represented by this Agreement shall be
exercisable only at such times and in such amounts as are set forth
on
Schedule I, attached hereto and made a part hereof. The option shall
expire as to all Subject Shares on the tenth
anniversary date of this Agreement if not exercised on or before
such
date.
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2.
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Regulatory
Compliance.
This option may not be exercised until all applicable federal and
state
securities requirements pertaining to the offer and sale of the securities
issued pursuant to the Plan have been met and the Company has been
advised
by counsel that all applicable requirements have been
met.
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3.
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Exercise
of Options.
Subject to the limitation specified in Section 2 and Schedule I hereof,
the Grantee may from time to time exercise this option by delivering
a
written notice of exercise and subscription agreement to the Secretary
of
the Company specifying the number of whole shares to be purchased,
accompanied by payment in cash, by certified check, or bank cashier's
check, of the aggregate option price of such number of shares; provided,
however, that the Grantee may, with the approval of the Company's
Compensation Committee (the "Committee"), make payment in the form
of
delivery to the Company of Common Stock of the Company owned by the
Grantee, the fair market value of which equals the aggregate option
price,
or by payment partially in cash and partially in Common Stock of
the
aggregate option price. For this purpose, any shares so tendered
by the
Grantee shall be deemed to have a fair market value equal to the
average
of the closing sales price for the shares on the New York Stock Exchange
for the five trading days preceding the date of the exercise of the
option. Only the Grantee may exercise the option during the lifetime
of
the Grantee. No fractional shares may be purchased at any time
hereunder.
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4.
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Termination
of Employment.
If the Grantee ceases to be an employee of the Company or any of
its
subsidiaries for any reason other than retirement, permanent and
total
disability, or death, this option shall forthwith terminate. If the
Grantee's employment by the Company or any of its subsidiaries is
terminated by reason of retirement (which means such termination
of
employment as shall entitle the Grantee to benefits under the Company's
401k Plan or any successor plan of the Company or one of its
subsidiaries), the Grantee may exercise this option in whole or in
part at
any time within three months after such retirement, but not later
than the
date upon which this option would otherwise expire. If the Grantee
ceases
to be an employee of the Company or any of its subsidiaries because
of
permanent or total disability, the Grantee may exercise this option
in
whole or in part at any time within one year after such termination
of
employment by reason of such disability, but not later than the date
upon
which this option would otherwise expire. The foregoing exercise
provisions apply whether or not this option was otherwise vested
at the
date of the Grantee's retirement or termination of employment because
of
permanent and total disability.
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5.
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Death
of Grantee.
If the Grantee dies while employed by the Company or any of its
subsidiaries, within three months after the termination of his employment
because of retirement, or within one year after the termination of
his
employment because of permanent or total disability, this option
may be
exercised in whole or in part by the executor, administrator, or
estate
beneficiaries of the Grantee at any time after the date of the Grantee's
death but not later than the date upon which this option would otherwise
expire. The foregoing exercise provisions apply whether or not this
option
was otherwise vested at the date of the Grantee's
death.
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6.
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Delivery
of Certificates.
Upon the effective exercise of the option, or any part thereof,
certificates representing the shares so purchased, marked fully paid
and
non-assessable shall be delivered to the person who exercised the
option
as soon as the Company is reasonably able to do so. Until certificates
representing such shares shall have been issued and delivered, the
Grantee
shall not have any of the rights or privileges of a shareholder of
the
Company in respect of any of such
shares.
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7.
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Stock
Splits or Dividends.
In the event that prior to the delivery by the Company of all the
Subject
Shares, there shall be an increase or reduction in the number of
shares of
Common Stock of the Company issued and outstanding by reason of any
subdivision or consolidation of the Common Stock or any other capital
adjustment, the number of shares then subject to this option shall
be
increased or decreased as provided in the
Plan.
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8.
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No
Assignment.
The option and the rights and privileges conferred by this Option
Agreement shall not be assigned or transferred by the Grantee in
any
manner except by will or under the laws of descent and distribution.
In
the event of any attempted assignment or transfer in violation of
this
paragraph, the option, rights and privileges conferred by this Stock
Option Agreement shall become null and
void.
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9.
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Employment
at Will.
Nothing herein contained shall be deemed to create any limitation
or
restriction upon such rights as the Company would otherwise have
to
terminate a person as an employee of the
Company.
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10.
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Notices.
Any notices to be given or served under the terms of this Option
Agreement
shall be addressed to the Secretary of the Company at 00 Xxxxx
Xxxxxxxxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxx, 00000, and to the Grantee
at
the address set forth on page one of this Stock Option Agreement,
or such
other address or addresses as either party may hereafter designate
in
writing to the other. Any such notice shall be deemed to have been
duly
given or served, if and when enclosed in a properly sealed envelope
addressed as aforesaid, postage prepaid, and deposited in the United
States mail or set via reputable overnight
carrier.
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11.
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Interpretation
of Agreement and Plan.
The interpretation by the Committee of any provisions of the Plan
or of
this Stock Option Agreement shall be final and binding on the Grantee
unless otherwise determined by the Company's Board of
Directors.
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12.
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Controlling
Document.
This option is subject to all the terms, provisions and conditions
of the
Plan, which is incorporated herein by reference and to such regulations
as
may from time to time be adopted by the Committee. A copy of the
Plan will
be furnished to the Grantee upon request and is available for free
on the
Company’s web site, xxx.xxxxxxxxxxx.xxx
in
the Company’s 2006 Proxy Statement. In the event of any conflict between
the provisions of the Plan and the provisions of this Stock Option
Agreement, the terms, conditions and provisions of the Plan shall
control,
and this Stock Option Agreement shall be deemed to be modified
accordingly.
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13.
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Incentive
Stock Options.
This Stock Option Agreement is intended to grant an option which
meets the
requirements of stock options as defined in Section 422A of the Internal
Revenue Code. Subject to and upon the terms, conditions and provisions
of
the Plan, each and every provision of this Stock Option Agreement
shall be
administered, construed and interpreted so that the option granted
herein
shall qualify as an incentive stock
option.
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14.
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IN
WITNESS WHEREOF, the Company and the Grantee have signed this Stock Option
Agreement as of the day and year first above written.
"COMPANY"
By:
___________________________________
ATTEST:
_________________________________ "GRANTEE"
By:
___________________________________
