BOSTON RESTAURANT ASSOCIATES, INC.
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INCENTIVE STOCK OPTION AGREEMENT
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Incentive Stock Option Agreement (the "Option") made effective as of
_____________, between Boston Restaurant Associates, Inc. (the "Corporation"),
and _____________ (the "Recipient"), an employee of the Corporation, a parent or
a subsidiary of the Corporation ("Parent" and "Subsidiary," respectively),
pursuant to the Corporation's 1994 Combination Stock Option Plan, as it may be
amended from time to time (the "1994 Plan").
W I T N E S S E T H:
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WHEREAS, on July 29, 1994, the Corporation adopted the 1994 Plan which
provides, for the issuance of stock options including stock options intended to
qualify as "incentive stock options", as defined in Section 422 of the Internal
Revenue Code of 1986, as amended (The "Code"); and
WHEREAS, the Corporation and the Recipient desire to enter into an
agreement whereby the Corporation will grant the Recipient an option to purchase
shares of the Common Stock, $.01 par value, of the Corporation (the "Stock"),
and this Option is intended to qualify as an incentive stock option;
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Corporation and the Recipient
agree as follows:
1. Grant of Option.
Pursuant to the terms and conditions of the 1994 Plan and this Option, the
Corporation hereby grants to the Recipient an Option to purchase, as provided in
Section 3 hereof, all or any part of a total of ________ shares of Stock (the
"Option Shares").
2. Purchase Price.
The price at which the Option Shares may be purchased shall be $_____ per
share (the "Option Exercise Price"). This price is not less than the Fair Market
Value of the Stock on the date of this Option.
3. Exercise of Option.
Subject to the provisions of Section 4 and the right of the Corporation to
accelerate the date upon which any or all of this Option becomes exercisable,
the Recipient shall be entitled to exercise this Option with respect to the
percentage of the Option Shares provided as follows:
Percentage of Total
Years Elapsed From Option Shares
November 1, 1995 Purchasable
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1 or more, but not more than 5 40%
2 or more, but not more than 5 60%
3 or more, but not more than 5 80%
4 or more, but not more than 5 100%
Notwithstanding any provision of this Option to the contrary, in no event may
this Option be exercised after five (5) years from the date of this Option (the
"Expiration Date").
4. Termination of Employment.
If the Recipient ceases to be employed by the Corporation, a Parent, or a
Subsidiary (a "Termination"), then this Option may be exercised as to all shares
with respect to which Recipient could exercise this Option on the date of
Termination, and which shares have not been previously purchased, until the
earlier of the Expiration Date, or:
(i) in the case of Termination by reason of death or Permanent and Total
Disability, one (1) year after termination of employment and;
(ii) in the case of any other Termination, other than termination for
cause, three (3) months after the termination of employment.
Notwithstanding the foregoing, in the case of Termination for cause, the ability
to exercise this Option may be terminated on such earlier date as the
Corporation may specify, and such date may be set so as to prevent the Recipient
from further exercising any portion of this Option.
5. Nontransferability; Persons Able to Exercise.
The Option may not be transferred other than by will or the laws of descent
and distribution. During the life of the Recipient, only the Recipient may
exercise this Option. If the Recipient dies while still employed by the
Corporation, or the periods specified in Section 4, this Option may be exercised
by his executors, administrators,
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legatees or distributees, provided that such person or persons comply with the
provisions of this Option applicable to the Recipient.
6. Method of Exercising Option.
The Option may be exercised, in whole or in part, by written notice to the
Corporation, containing an executed Notice of Exercise in the form of Attachment
A, provided that the Corporation, in its discretion, may modify or augment these
requirements as provided in Section 9 of this Option, or where appropriate
because a person other than the Recipient is exercising the Option pursuant to
Section 5. The written notice specified in this Section must be accompanied by
payment of the Option Exercise Price for the shares being purchased. Payment
shall be made in cash, unless the Corporation, in its sole discretion,
authorizes payment to be made in shares of the Corporation or a combination of
such shares and cash. As soon as practical after receipt of this notice and
payment, the Corporation shall deliver a certificate or certificates
representing the purchased shares registered in the name of the person or
persons exercising this Option. In the event this Option is exercised by any
person other than the Recipient, the notice shall be accompanied by appropriate
proof of the right of such person to exercise this Option. All shares purchased
upon the exercise of this Option and payment of the full Option Exercise Price
will be fully paid and nonassessable.
7. Stock Adjustments.
If there shall be any change in the Stock through merger, consolidation,
reorganization, recapitalization, or other change in the corporate structure of
the Corporation, appropriate adjustments in the total number and kind of shares
subject to this Option, consistent with the requirements of the Code to insure
that this Option will qualify as an Incentive Stock Option, shall be made by the
Corporation as provided in the 1994 Plan. Such adjustments may include the
elimination of any fractional shares that might otherwise be subject to this
Option.
8. No Rights Other Than Those Expressly Created.
Neither this Option nor any action taken hereunder shall be construed as
(i) giving the Recipient any right to be retained in the employ of, or continue
to be affiliated with, the Corporation, (ii) giving the Recipient any equity or
interest of any kind in any assets of the Corporation, or (iii) creating a trust
of any kind or a fiduciary relationship of any kind between the Recipient and
the Corporation. As to any claim for any unpaid
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amounts under this Option, any person having a claim for payments shall be
unsecured creditor. The Recipient shall not have any of the rights of a
stockholder with respect to any Option Shares until such time as this Option has
been exercised and Option Shares have been issued.
9. Compliance with Laws.
(a) Withholding of Taxes. Pursuant to applicable federal, state, local or
foreign laws, the Corporation may be required to collect or withhold income or
other taxes from Recipient upon the grant of this Option, the exercise of this
Option, or at some other time. The Corporation may require, as a condition to
the exercise of this Option, or demand, at such other time as it may consider
appropriate, that the Recipient pay the Corporation the amount of any taxes
which the Corporation may determine is required to be collected or withheld, and
the Recipient shall comply with the requirement or demand of the Corporation.
(b) Securities Law Compliance. Upon exercise (or partial exercise) of this
Option, the Recipient shall make such representations and furnish such
information as may, in the opinion of counsel for the Corporation, be
appropriate to permit the Corporation to issue or transfer the Option Shares in
compliance with the provisions of applicable federal or state securities laws.
The Corporation, in its discretion, may postpone the issuance and delivery of
Option Shares upon any exercise of this Option until completion of such
registration or other qualification of such shares under any federal or state
laws, or stock exchange listing, as the Corporation may consider appropriate.
The Corporation may require that, prior to the issuance or transfer of Option
Shares upon exercise of this Option, the Recipient enter into a written
agreement to comply with any restrictions on subsequent disposition that the
Corporation deems necessary or advisable under any applicable federal and state
securities laws. Certificates of Stock issued hereunder may bear a legend
reflecting such restrictions.
(c) General. No Option Shares shall be issued upon exercise of this Option
unless and until the Corporation is satisfied, in its sole discretion, that
there has been compliance with all legal requirements applicable to the issuance
of such Option Shares.
10. Miscellaneous.
(a) Provisions of the Plan. This Option is expressly subject to all of the
terms and conditions contained in this Option and in the 1994 Plan, except those
terms and conditions which are expressly applicable only to options which are
not "1994 Plan ISOs",
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and the 1994 Plan is hereby incorporated herein by reference. All capitalized
terms not defined in this Option have the meanings specified in the 1994 Plan.
(b) Discretion of the Committee. Unless otherwise explicitly provided
herein, the Committee, as defined in the Plan, shall make all determinations
required to be made hereunder, including determinations required to be made by
the Corporation, and shall interpret all provisions of this Option, as it deems
necessary or desirable, in its sole and unfettered discretion. Such
determinations and interpretations shall be binding and conclusive to the
Corporation and the Recipient. The Committee, in its sole discretion, is
authorized (i) to convert the unexercised portion of this Option to an option
which is not an incentive stock option by written notice to the Recipient, and
(ii) to accelerate the time at which this Option may be exercised.
(c) $100,000 Limitation. As provided in Section IV(d) of the Plan, if the
aggregate Fair Market Value of Common Stock with respect to which Corporation
ISOs (determined without regard to Section IV(d) of the Plan) are exercisable
for the first time by the Recipient during any calendar year exceeds $100,000, a
portion of such Corporation ISOs (which may include this Option) shall be
treated as options which are not Incentive Stock Options. For purposes of this
limitation, (i) options shall be taken into account in the order granted, and
(ii) the Committee may designate that portion of any Corporation ISO (including
this Option) that shall be treated as not an Incentive Stock Option if the
provisions of this paragraph apply to a portion of any option, unless another
treatment is required by the Code or regulations of the Internal Revenue
Service. The foregoing designation may be made at such time as the Committee
considers appropriate, including after the issuance of this Option or at the
time of its exercise. For the purpose of this section, Fair Market Value shall
be determined as of the time the option with respect to such stock is granted.
(d) Reservation of Shares. During the term of this Option, the Corporation
shall at all times reserve and keep available shares of Stock sufficient to
satisfy the requirements of this Option.
(e) Amendment. This Option may only be modified or amended by a writing
signed by both parties.
(f) Notices. Any notices required to be given under this Option shall be
sufficient if in writing and if hand-delivered or if sent by first class mail
and addressed as follows:
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if to the Corporation:
Boston Restaurant Associates, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: President
if to the Recipient:
c/o Boston Restaurant Associates, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
or to such other address as either party may designate under the provisions
hereof.
(g) Successors and Assigns. The rights and obligations of the Corporation
under this Option shall inure to the benefit of and be binding upon the
successors and assigns of the Corporation.
(h) Applicable Law. All rights and obligations under this Option shall be
governed by the laws of the State of Delaware.
(i) Paragraph Headings. The paragraph headings used in this Option are for
convenience or reference, and are not to be construed as part of this Option.
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IN WITNESS WHEREOF, the parties have executed this Option as an instrument
under seal effective as of the date written on the first page of this Option.
BOSTON RESTAURANT
ASSOCIATES, INC.
By: ________________________________
Xxxxxx X. Xxxxxxxxxxx, President
RECIPIENT:
____________________________________
Name:
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ATTACHMENT A
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NOTICE OF EXERCISE
Boston Restaurant Associates, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Treasurer
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Gentlemen:
Pursuant to our Incentive Stock Option Agreement dated as of November 1,
1996, I hereby elect to exercise this Option to the extent indicated:
Number of Shares Per Share Total
Which I Elect to x Price = Price
Purchase
_______________ x _______________ = __________
Enclosed with this letter is full payment of the total price of the shares
described above in the following form:
(1) a check in the amount of $_______ payable to the order of the
Corporation; and/or [if authorized by the Corporation]
(2) shares of Stock of the Corporation properly endorsed and having a fair
market value equal to $________.
Kindly issue a certificate or certificates to me representing the shares
which I am acquiring by this exercise, and deliver it to the address provided
above.
Very truly yours,
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Name
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