EXHIBIT 10.1
O’CHARLEY’S INC.
2008 EQUITY AND INCENTIVE PLAN
Section 1. Purpose.
This plan shall be known as the
“O’Charley’s, Inc. 2008 Equity and Incentive
Plan” (the “Plan”). The purpose of the Plan is to
promote the interests of O’Charley’s, Inc. (the
“Company”) and its stockholders by (i) attracting
and retaining key officers, employees, advisory board members and
directors of, and consultants to, the Company and its Subsidiaries
and Affiliates; (ii) motivating such individuals by means of
performance-related incentives to achieve long-range performance
goals; (iii) enabling such individuals to participate in the
long-term growth and financial success of the Company;
(iv) encouraging ownership of stock in the Company by such
individuals; and (v) linking their compensation to the
long-term interests of the Company and its stockholders. With
respect to any awards granted under the Plan that are intended to
comply with the requirements of “performance-based
compensation” under Section 162(m) of the Code, the Plan
shall be interpreted in a manner consistent with such
requirements.
Section 2. Definitions.
As used in the Plan, the following
terms shall have the meanings set forth below:
(a) “Affiliate” shall mean (i) any
entity that, directly or indirectly, is controlled by the Company,
(ii) any entity in which the Company has a significant equity
interest, (iii) an affiliate of the Company, as defined in
Rule 12b-2 promulgated under Section 12 of the Exchange
Act, and (iv) any entity in which the Company has at least twenty
percent (20%) of the combined voting power of the entity’s
outstanding voting securities, in each case as designated by the
Board as being a participating employer in the Plan.
(b) “Award”
shall mean any Option, Stock Appreciation Right, Restricted Share
Award, Restricted Share Unit, Performance Award, Other Stock-Based
Award or other award granted under the Plan, whether singly, in
combination or in tandem, to a Participant by the Committee (or the
Board) pursuant to such terms, conditions, restrictions and/or
limitations, if any, as the Committee (or the Board) may
establish.
(c) “Award
Agreement” shall mean any written agreement, contract or
other instrument or document evidencing any Award, which may, but
need not, be executed or acknowledged by a Participant.
(d) “Board”
shall mean the Board of Directors of the Company.
(e) “Cause”
shall mean, unless otherwise defined in the applicable Award
Agreement, (i) a felony conviction of a Participant or the
failure of a Participant to contest prosecution of a felony or
(ii) a Participant’s willful misconduct or dishonesty
that is directly and materially harmful to the business or
reputation of the Company or its Subsidiaries or Affiliates. For
purposes of this paragraph, no act, or failure to act, on the
Participant’s part shall be considered “willful”
unless done, or omitted to be done, by the Participant not in good
faith and without reasonable belief that the Participant’s
action or omission was in the best interest of the Company. Any
determination of Cause for purposes of the Plan or any Award shall
be made by the Committee in its sole discretion. Any such
determination shall be final and binding on a Participant.
(f) “Change in
Control” shall mean, unless otherwise defined in the
applicable Award Agreement, any of the following events:
(i) An acquisition (other
than directly from the Company) of any voting securities of the
Company (the “Voting Securities”) by any
“Person” (as the term Person is used for purposes of
Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”)) immediately after which
such Person has “Beneficial Ownership” (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of
more than thirty percent (30%) of the combined voting power of the
then outstanding Voting Securities; provided, however, that in
determining whether a Change in Control has occurred, Voting
Securities which are acquired in a “Non-Control
Acquisition” (as hereinafter defined) shall not
constitute an acquisition which would cause a Change in Control. A
“Non-Control Acquisition” shall mean an acquisition by
(i) an employee benefit plan (or a trust forming a part
thereof) maintained by (A) the Company or (B) any
Subsidiary, or (ii) the Company.
(ii) During any period of two
consecutive years, individuals who at the beginning of such period
were members of the Board cease for any reason to constitute at
least a majority thereof (unless the election, or the nomination
for election by the Company’s stockholders, of each new
director was approved by a vote of at least two-thirds of the
directors then still in office who were directors at the beginning
of such period); provided, however, that no individual shall be
considered a member of the Board if (1) such individual
initially assumed office as a result of either an actual or
threatened solicitation by a person or group of persons with
respect to the election or removal of directors at any meeting of
shareholders (an “Election Contest”) or other actual or
threatened solicitation of proxies or consents by or on behalf of a
Person other than the Board (a “Proxy Contest”)
including by reason of any agreement intended to avoid or settle
any Election Contest or Proxy Contest or (2) such individual
was designated by a Person who has entered into an agreement with
the Company to effect a transaction described in clause (i) or
(iii) of this paragraph; or
(iii) Approval by
stockholders of the Company of:
(A) A merger, consolidation
or reorganization involving the Company, unless,
(1) The stockholders of the
Company, immediately before such merger, consolidation or
reorganization, own, directly or indirectly immediately following
such merger, consolidation or reorganization, more than fifty
percent (50%) of the combined voting power of the outstanding
Voting Securities of the corporation (the “Surviving
Corporation”) in substantially the same proportion as their
ownership of the Voting Securities immediately before such merger,
consolidation or reorganization; and
(2) The individuals who were
members of the Incumbent Board immediately prior to the execution
of the agreement providing for such merger, consolidation or
reorganization constitute more than one-half of the members of the
board of directors of the Surviving Corporation;
(B) A complete liquidation or
dissolution of the Company; or
(C) An agreement for the sale
or other disposition of all or substantially all of the assets of
the Company to any Person (other than a transfer to a
Subsidiary).
Notwithstanding the foregoing, a
Change in Control shall not be deemed to occur solely because any
Person (the “Subject Person”) acquired Beneficial
Ownership of more than the permitted amount of the outstanding
Voting Securities as a result of the acquisition of Voting
Securities by the Company which, by reducing the number of Voting
Securities outstanding, increased the proportional number of shares
Beneficially Owned by the Subject Person, provided that if a Change
in Control would occur (but for the operation of this sentence) as
a result of the acquisition of Voting Securities by the Company,
and after such share acquisition by the Company, the Subject Person
becomes the Beneficial Owner of any additional Voting Securities
Beneficially Owned by the Subject Person, then a Change in Control
shall occur.
(g) “Code”
shall mean the Internal Revenue Code of 1986, as amended from time
to time.
(h) “Committee” shall mean a committee of
the Board composed of not less than two Non-Employee Directors,
each of whom shall be (i) a “non-employee
director” for purposes of Exchange Act Section 16 and
Rule 16b-3 thereunder, (ii) an “outside
director” for purposes of Section 162(m) and the regulations
promulgated
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under
the Code, and (iii) “independent” within the meaning of
the listing standards of the NASDAQ Global Select Market, or any
other exchange on which the Company’s Shares are
traded.
(i) “Consultant” shall mean any consultant
to the Company or its Subsidiaries or Affiliates.
(j) “Covered
Officer” shall mean at any date (i) any individual
who, with respect to the previous taxable year of the Company, was
a “covered employee” of the Company within the meaning
of Section 162(m); provided, however, that the term
“Covered Officer” shall not include any such individual
who is designated by the Committee, in its discretion, at the time
of any Award or at any subsequent time, as reasonably expected not
to be such a “covered employee” with respect to the
taxable year of the Company in which any applicable Award will be
paid or vested and (ii) any individual who is designated by
the Committee, in its discretion, at the time of any Award or at
any subsequent time, as reasonably expected to be such a
“covered employee” with respect to the current taxable
year of the Company or with respect to the taxable year of the
Company in which any applicable Award will be paid or vested.
(k) “Director” shall mean a member of the
Board.
(l) “Disability” shall mean, unless
otherwise defined in the applicable Award Agreement, a disability
that would qualify as a total and permanent disability under the
Company’s then current long-term disability plan.
(m) “Early
Retirement” means the retirement of an employee, with the
express consent of the Company at or before the time of such
retirement, from active employment with the Company and any
Subsidiary or Affiliate prior to age 65, in accordance with any
applicable early retirement policy of the Company then in effect or
as may be approved by the Committee.
(n) “Employee” shall mean a current or
prospective officer or employee of the Company or of any Subsidiary
or Affiliate.
(o) “Exchange
Act” shall mean the Securities Exchange Act of 1934, as
amended from time to time.
(p) “Fair Market
Value” with respect to the Shares, shall mean, for
purposes of a grant of an Award as of any date, (i) the
closing sales price of the Shares on the NASDAQ Global Select
Market, or any other such exchange on which the Shares are traded,
on such date, or in the absence of reported sales on such date, the
closing sales price on the immediately preceding date on which
sales were reported or (ii) in the event there is no public
market for the Shares on such date, the fair market value as
determined, in good faith, by the Committee in its sole discretion,
and for purposes of a sale of a Share as of any date, the actual
sales price on that date.
(q) “Good
Reason” means (i) a material reduction in
Participant’s base salary or a material reduction in the
health and welfare insurance, retirement and other benefits
available to Participant from that in effect immediately prior to a
Change in Control, except for reductions in such benefits as shall
become in effect for employees of the Company generally;
(ii) the reassignment of Participant to a position resulting
in a material diminution in Participant’s authority, duties
or responsibilities; or (iii) the relocation of the office at
which the Participant is to perform a majority of his or her duties
to a location more than fifty (50) miles from the location at
which the Participant performed such duties prior to a Change in
Control.
(r) “Incentive Stock
Option” shall mean an option to purchase Shares from the
Company that is granted under Section 6 of the Plan and
that is intended to meet the requirements of Section 422 of
the Code or any successor provision thereto.
(s) “Non-Qualified
Stock Option” shall mean an option to purchase Shares
from the Company that is granted under Sections 6 or
10 of the Plan and is not intended to be an Incentive Stock
Option.
(t) “Non-Employee
Director” shall mean a member of the Board who is not an
officer or employee of the Company or any Subsidiary or
Affiliate.
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(u) “Option”
shall mean an Incentive Stock Option or a Non-Qualified Stock
Option.
(v) “Option
Price” shall mean the purchase price payable to purchase
one Share upon the exercise of an Option.
(w) “Other Stock-Based
Award” shall mean any Award granted under
Sections 9 or 10 of the Plan. For purposes of
the share counting provisions of Section 4.1 hereof, an
Other Stock-Based Award shall be treated as (i) an Option
Award if the amounts payable thereunder will be determined by
reference to the appreciation of a Share, and (ii) a
Restricted Share Award if the amounts payable thereunder will be
determined by reference to the full value of a Share.
(x) “Outside
Director” means, with respect to the grant of an Award, a
member of the Board then serving on the Committee.
(y) “Participant” shall mean any Employee,
Director, Consultant or other person who receives an Award under
the Plan.
(z) “Performance
Award” shall mean any Award granted under
Section 8 of the Plan.
(aa) “Person” shall mean any individual,
corporation, partnership, limited liability company, association,
joint-stock company, trust, unincorporated organization, government
or political subdivision thereof or other entity.
(bb) “Restricted
Share” shall mean any Share granted under Sections 7
to 10 of the Plan.
(cc) “Restricted Share
Unit” shall mean any unit granted under Sections 7
to 10 of the Plan.
(dd) “Retirement” shall mean, unless
otherwise defined in the applicable Award Agreement, retirement of
a Participant from the employ or service of the Company or any of
its Subsidiaries or Affiliates in accordance with the terms of the
applicable Company retirement plan or, if a Participant is not
covered by any such plan, retirement on or after such
Participant’s 65 th birthday.
(ee) “SEC”
shall mean the Securities and Exchange Commission or any successor
thereto.
(ff) “Section 16” shall mean
Section 16 of the Exchange Act and the rules promulgated
thereunder and any successor provision thereto as in effect from
time to time.
(gg) “Section 162(m)” shall mean
Section 162(m) of the Code and the regulations promulgated
thereunder and any successor provision thereto as in effect from
time to time.
(hh) “Shares” shall mean shares of the
common stock, no par value, of the Company.
(ii) “Stock
Appreciation Right” or “SAR” shall
mean a stock appreciation right granted under
Sections 6 or 10 of the Plan that entitles the
holder to receive, with respect to each Share encompassed by the
exercise of such SAR, the amount determined by the Committee and
specified in an Award Agreement. In the absence of such a
determination, the holder shall be entitled to receive, with
respect to each Share encompassed by the exercise of such SAR, the
excess of the Fair Market Value on the date of exercise over the
Fair Market Value on the date of grant.
(jj) “Subsidiary” shall mean any Person
(other than the Company) of which a majority of its voting power or
its equity securities or equity interest is owned directly or
indirectly by the Company.
(kk) “Substitute
Awards” shall mean Awards granted solely in assumption
of, or in substitution for, outstanding awards previously granted
by a company acquired by the Company or with which the Company
combines.
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Section 3. Administration.
3.1 Authority of Committee.
The Plan shall be administered by the Committee, which shall be
appointed by and serve at the pleasure of the Board; provided,
however, with respect to Awards to Outside Directors, all
references in the Plan to the Committee shall be deemed to be
references to the Board. Subject to the terms of the Plan and
applicable law, and in addition to other express powers and
authorizations conferred on the Committee by the Plan, the
Committee shall have full power and authority in its discretion to:
(i) designate Participants; (ii) determine the type or
types of Awards to be granted to a Participant;
(iii) determine the number of Shares to be covered by, or with
respect to which payments, rights or other matters are to be
calculated in connection with Awards; (iv) determine the
timing, terms, and conditions of any Award; (v) accelerate the
time at which all or any part of an Award may be settled or
exercised; (vi) determine whether, to what extent, and under
what circumstances Awards may be settled or exercised in cash,
Shares, other securities, other Awards or other property, or
canceled, forfeited or suspended and the method or methods by which
Awards may be settled, exercised, canceled, forfeited or suspended;
(vii) determine whether, to what extent, and under what
circumstances cash, Shares, other securities, other Awards, other
property, and other amounts payable with respect to an Award shall
be deferred either automatically or at the election of the holder
thereof or of the Committee; (viii) interpret and administer
the Plan and any instrument or agreement relating to, or Award made
under, the Plan; (ix) except to the extent prohibited by
Section 6.2 , amend or modify the terms of any Award at
or after grant with the consent of the holder of the Award;
(x) establish, amend, suspend or waive such rules and
regulations and appoint such agents as it shall deem appropriate
for the proper administration of the Plan; and (xi) make any
other determination and take any other action that the Committee
deems necessary or desirable for the administration of the Plan,
subject to the exclusive authority of the Board under
Section 14 hereunder to amend or terminate the
Plan.
3.2 Committee Discretion
Binding. Unless otherwise expressly provided in the Plan, all
designations, determinations, interpretations, and other decisions
under or with respect to the Plan or any Award shall be within the
sole discretion of the Committee, may be made at any time and shall
be final, conclusive, and binding upon all Persons, including the
Company, any Subsidiary or Affiliate, any Participant and any
holder or beneficiary of any Award.
3.3 Action by the Committee.
The Committee shall select one of its members as its Chairperson
and shall hold its meetings at such times and places and in such
manner as it may determine. A majority of its members shall
constitute a quorum. All determinations of the Committee shall be
made by not less than a majority of its members. Any decision or
determination reduced to writing and signed by all of the members
of the Committee shall be fully effective as if it had been made by
a majority vote at a meeting duly called and held. The exercise of
an Option or receipt of an Award shall be effective only if an
Award Agreement shall have been duly executed and delivered on
behalf of the Company following the grant of the Option or other
Award. The Committee may appoint a Secretary and may make such
rules and regulations for the conduct of its business, as it shall
deem advisable.
3.4 Delegation. Subject to the
terms of the Plan and applicable law, the Committee may delegate to
one or more officers or managers of the Company or of any
Subsidiary or Affiliate, or to a Committee of such officers or
managers, the authority, subject to such terms and limitations as
the Committee shall determine, to grant Awards to or to cancel,
modify or waive rights with respect to, or to alter, discontinue,
suspend or terminate Awards held by Participants who are not
officers or directors of the Company for purposes of
Section 16 or who are otherwise not subject to such
Section.
3.5 No Liability. No member of
the Board or Committee shall be liable for any action taken or
determination made in good faith with respect to the Plan or any
Award granted hereunder.
Section 4. Shares Available For Awards.
4.1 Shares Available. Subject
to the provisions of Section 4.2 hereof, the maximum
aggregate number of Shares that may be issued pursuant to Awards
shall not exceed 1,500,000 Shares (the “Share
Reserve”). Each Share issued pursuant to an Option shall
reduce the Share Reserve by one (1) share. Each Share subject
to a redeemed portion of a SAR (whether the distribution upon
redemption is made in cash, stock or a combination of the two)
shall reduce the Share Reserve by one (1) share. Each Share
issued pursuant to a Restricted Stock Award, a Restricted
Stock
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Unit
Award or a Performance Award shall reduce the Share Reserve by one
and fifty-three one-hundreths (1.53) shares. To the extent that a
distribution pursuant to an Award is made in cash, the Share
Reserve shall be reduced by the number of Shares subject to the
redeemed or exercised portion of the Award. Notwithstanding the
foregoing and subject to adjustment as provided in
Section 4.2 , (i) each Option or SAR granted under
this Plan, or outstanding under the 2000 Stock Incentive Plan or
the 1990 Employee Stock Plan, (the “Previous Plans”),
as of the effective date of this Plan, but which terminate, expire
unexercised, are forfeited or cancelled without the delivery of
cash or Shares under the terms of the applicable Award or Previous
Plan, shall increase the Share Reserve by one (1) share; and
(ii) each Restricted Stock Award, Restricted Stock Unit Award
or Performance Award (denominated in Shares) granted under this
Plan, or outstanding under any Previous Plan as of the effective
date of this Plan, but which terminate, expire unexercised, are
forfeited or cancelled without the delivery of cash or Shares under
the terms of the applicable Award or Previous Plan, shall increase
the Share Reserve by one and fifty-three one-hundreths (1.53)
shares. Notwithstanding the foregoing and subject to adjustment as
provided in Section 4.2 hereof, no Participant may
receive Options or SARs under the Plan in any calendar year that,
taken together, relate to more than 400,000 Shares.
4.2 Adjustments. In the event
that any dividend or other distribution (whether in the form of
cash, Shares, other securities or other property and other than
regular, recurring dividends), recapitalization, stock split,
reverse stock split, reorganization, merger, consolidation,
split-up, spin-off, combination, repurchase or exchange of Shares
or other securities of the Company, issuance of warrants or other
rights to purchase Shares or other securities of the Company, or
other similar corporate transaction or event affects the Shares,
then the Committee shall, in such manner as it deems equitable and
proportionate (and in such manner as is consistent with any
provisions of the Code applicable to such Award): (i) adjust
any or all of (1) the aggregate number of Shares or other
securities of the Company or its successor (or number and kind of
other securities or property) with respect to which Awards may be
granted under the Plan; (2) the number of Shares or other
securities of the Company or its successor (or number and kind of
other securities or property) subject to outstanding Awards under
the Plan; (3) the grant or exercise price with respect to any
Award under the Plan, provided that the number of shares subject to
any Award shall always be a whole number; and (4) the limits
on the number of Shares that may be granted to Participants under
the Plan in any calendar year; (ii) subject to
Section 13, provide for an equivalent award in respect of
securities of the surviving entity of any merger, consolidation or
other transaction or event having a similar effect; or
(iii) make provision for a cash payment to the holder of an
outstanding Award.
4.3 Substitute Awards. Any
Shares issued by the Company as Substitute Awards in connection
with the assumption or substitution of outstanding grants from any
acquired corporation shall not reduce the Shares available for
Awards under the Plan.
4.4 Sources of Shares Deliverable
Under Awards. Any
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