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EXHIBIT 10.8
STOCK OPTION AGREEMENT
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This Agreement is made this ___ day of _________, 199__,
between Skyline Chili, Inc. (hereinafter referred to as the "Company"), an Ohio
corporation, and ______________________, an employee of the Company
(hereinafter referred to as the "Optionee").
WHEREAS, the Company has adopted and maintains the Skyline
Chili, Inc. 1990 Stock Option and Stock Incentive Plan (hereinafter referred to
as the "Plan") for the benefit of its employees and officers;
WHEREAS, the Plan provides that a committee (hereinafter
referred to as the "Committee") of the Company's Board of Directors
(hereinafter referred to as the "Board"), may grant options to purchase shares
of the Company's common stock to certain of its key employees and officers; and
WHEREAS, the Committee has determined that the Optionee should
be given the opportunity to acquire a stock ownership interest in the Company
pursuant to the Plan, in order to provide the Optionee with additional
incentive and motivation to contribute to the Company's future growth and
continued success, and to encourage the Optionee to continue to provide
services to the Company.
NOW, THEREFORE, the Company and the Optionee agree as follows:
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1. Grant of Option.
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Pursuant to the provisions of the Plan, the Company
hereby grants to the Optionee the right and option to purchase from the
Company, on the terms and conditions hereinafter provided, up to a maximum
number of ___________ shares of the Company's no par value common stock
(hereinafter referred to as the "Option Shares").
2. Exercise Price.
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The exercise or purchase price to be paid by the
Optionee for the Option Shares shall be $__________ per share.
3. Schedule of Exercise.
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(a) Except as provided below in Paragraph 3(b),
the Optionee shall have the right to exercise the option granted under this
Agreement in accordance with the following schedule:
Years After Date Percentage of Option
of Grant of Option Shares Eligible for Purchase
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Less than one year. 0%
At least one but less than
two years. 25%
At least two but less than
three years. 50%
At least three but less than
four years. 75%
After four years. 100%
For purposes of the preceding schedule, the date of the grant of this option
shall be the day and year stated in the first paragraph of this Agreement.
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(b) If there is a "change in control" of the
Company, all options granted under this Agreement shall become exercisable
immediately by the Optionee, in such a manner as shall allow the Optionee upon
exercise to participate in the "change in control" transaction or the proceeds
thereof as a shareholder. For purposes of this Paragraph 3(b), a "change in
control" shall mean: (i) the sale by the Company of all or substantially all of
the Company's assets to a single purchaser or to a group of associated
purchasers; (ii) the sale, exchange, or other disposition, in one transaction
or related series of transactions, of fifty percent (50%) or more of the
outstanding shares of the Company; (iii) a bona fide decision by the Company to
terminate its business and liquidate its assets; or (iv) the merger or
consolidation of the Company in a transaction in which the shareholders of the
Company receive or hold less than fifty percent (50%) of the outstanding voting
shares of the continuing or new corporation.
4. Method of Exercise.
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Subject to the schedule provided in Paragraph (3) of
this Agreement, the option granted under this Agreement may be exercised by the
Optionee in whole or in part, and from time to time, by written notice signed
by the Optionee or by such other person as may be entitled to exercise the
option and delivered to the Stock Option Committee or the Company's president
at the Company's principal executive offices. The written notice shall state
the number of shares with respect to which the option is
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being exercised, and shall be accompanied by the payment of the total exercise
or purchase price for that number of shares. The exercise or purchase price
for the Option Shares may be paid in cash (including certified check or bank
cashier's check), or in shares of the Company's common stock, or in any
combination thereof. Any shares of the Company's common stock that are
delivered in payment of the exercise or purchase price shall be valued at their
fair market value, as determined by the Committee, as of the date of delivery
of the shares to the Company. Upon payment of the full exercise or purchase
price, the Option Shares shall be fully paid and nonassessable, outstanding
shares of the Company's common stock. No partial exercise of the option may be
made for less than 100 shares, and the Company shall not be required to issue
any fractional shares.
5. Termination of Option.
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(a) Subject to the provisions of Subparagraph (5)(b)
hereof, the option and all rights granted under this Agreement, to the extent
that those rights have not been exercised, shall terminate on the earlier of:
(i) the date that the Optionee is discharged or terminates his employment with
the Company for any reason, other than by reason of the Optionee's death or
permanent disability (as defined in Section 105(d)(4) of the Internal Revenue
Code of 1986, as amended); or (ii) the date which is ten years from the date of
the grant of this Option.
(b) If the Optionee dies or becomes permanently
disabled while serving as an employee of the Company, and prior
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to the ten year termination date described above, the Optionee or in the event
of the Optionee's death, his estate, personal representative or heirs, shall
have the right to exercise the option granted under this Agreement, for the
shares then available under the schedule provided in Paragraph 3, for a period
of 12 months following the Optionee's date of death or in the event of
permanent disability the last date on which the Optionee provided services to
the Company as an employee or officer.
6. Transferability.
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The option and all rights granted under this
Agreement shall be exercisable only by the Optionee, and shall not be
transferred, assigned, pledged or hypothecated in any manner (whether by
operation of law or otherwise) except, in the event of the Optionee's death, by
will or by the applicable laws of descent or distribution. Upon any attempt to
transfer, assign, pledge, hypothecate, or otherwise dispose of this option
contrary to the provisions of this Agreement, or upon the levy of any
attachment or similar process upon this option, such option shall immediately
become null and void.
7. Adjustment to Option Shares.
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(a) In the event that at any time prior to the
termination date of this option and prior to the exercise thereof, the Company
issues common stock by way of stock dividend or other distribution, or
subdivides or combines its outstanding shares of common stock, the number of
shares subject to this
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option and the exercise price shall be adjusted to be consistent with such
change or changes. In the event that at any time prior to the termination date
of this option and prior to the exercise thereof, there is any
reclassification, capital reorganization or other change of outstanding shares
of the Company's common stock, or in case of any consolidation or merger of the
Company with or into another corporation, or in case of any sale or conveyance
to another corporation of the property of the Company as an entirety or
substantially as an entirety, the Company shall cause effective provision to be
made so that the Optionee shall have the right thereafter, by exercising this
option, to purchase the kind and amount of shares of stock and other securities
and property receivable upon such reclassification, capital reorganization or
other change, consolidation, merger, sale or conveyance. The determination of
the Board or Committee as to any adjustments or provisions to be made under
this paragraph shall be final, binding and conclusive.
(b) Except as provided above, the grant of the
option herein shall not affect in any manner the right or power of the Company
or its shareholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company's capital
structure or its business, or any merger or consolidation of the Company, or to
issue bonds, debentures, preferred or prior preference stock ahead of or
affecting the common stock of the Company or the rights thereof, or the
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dissolution or liquidation of the Company, or any sale or transfer of all or
any part of the Company's assets or business.
8. Effect of Agreement on Status of Optionee.
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(a) The fact that the Committee has granted an
option to the Optionee pursuant to the Plan, shall not confer on the Optionee
any right to employment with the Company or to a position as an officer or
director of the Company, nor shall it limit the right of the Company to
terminate or remove the Optionee from any position held by him at any time.
(b) The Optionee shall not be or have any of the
rights or privileges of a shareholder of the Company with respect to the shares
underlying this option, unless and until the option has been exercised, the
exercise or purchase price fully paid, certificates representing such shares
endorsed, transferred and delivered to the Optionee, and the Optionee's name
entered as a shareholder of record on the books of the Company.
9. Securities Laws.
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Notwithstanding anything to the contrary contained in
this Agreement, this option shall not be exercisable by the Optionee except for
shares of the Company's common stock which at the time of such exercise are
registered, exempt, or the subject matter of an exempt transaction, under both
federal and applicable state securities laws. By accepting and executing this
Option Agreement, the Optionee acknowledges and represents to the Company that
any and all shares of the Company's common stock purchased under this Agreement
(unless registered prior to
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exercise) will be acquired by the Optionee as an investment, and not with a
view towards subsequent distribution.
10. Binding Effect.
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This Agreement shall be binding upon and shall inure
to the benefit of any successors or assigns of the Company, and shall be
binding upon and inure to the benefit of the Optionee's executors,
administrators, heirs and personal representatives.
IN WITNESS WHEREOF, the parties have executed this Agreement
on the day and year first above written.
SKYLINE CHILI, INC.
By:_______________________________
Its:______________________________
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(Optionee)
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