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PANERA BREAD COMPANY 2005 LONG-TERM INCENTIVE PROGRAM

Equity Incentive Plan Agreement

PANERA BREAD COMPANY  2005 LONG-TERM INCENTIVE PROGRAM | Document Parties: PANERA BREAD COMPANY You are currently viewing:
This Equity Incentive Plan Agreement involves

PANERA BREAD COMPANY

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Title: PANERA BREAD COMPANY 2005 LONG-TERM INCENTIVE PROGRAM
Governing Law: Delaware     Date: 9/1/2005
Industry: Restaurants     Sector: Services

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Exhibit 10.1

PANERA BREAD COMPANY

2005 LONG-TERM INCENTIVE PROGRAM

Section 1. Establishment .

Effective September 1, 2005, Panera Bread Company (the “Company”) hereby establishes the Long-Term Incentive Program (the “LTIP”) as a sub-plan under the Company’s 1992 Equity Incentive Plan (the “1992 Plan”) and, to the extent applicable, the Company’s 2001 Employee, Director and Consultant Stock Option Plan (the “2001 Plan”). Notwithstanding anything to the contrary herein, except to the extent permitted by the 1992 Plan and the 2001 Plan, the provisions of each of the 1992 Plan and 2001 Plan, as applicable, shall apply for purposes of the LTIP with respect to any awards under the 1992 Plan or the 2001 Plan, respectively.

Section 2. General Purpose of the Plan and Definitions .

The purpose of the LTIP is to provide eligible individuals with a meaningful stake in the Company’s success through long-term incentive awards. In doing so, the Company hopes to motivate and reward the attainment of longer-term profitable growth goals, support the recruitment and retention of individuals critical to the long-term success of the Company and align individual participants’ interests with those of customers and shareholders.

Except to the extent required by the 1992 Plan or the 2001 Plan, whenever used in the LTIP, the following terms shall have the meanings set forth in this Section 2. Capitalized terms not otherwise defined herein shall have the meanings set forth in the 1992 Plan or 2001 Plan, as applicable.

 

a)

 

Cause . Cause shall include (and is not limited to) dishonesty with respect to the Company or any Affiliate, insubordination, substantial malfeasance or non-feasance of duty, unauthorized disclosure of confidential information, or conduct substantially prejudicial to the business of the Company or any Affiliate or any other circumstance which would constitute or be deemed “cause” pursuant to any other agreement entered into between an LTIP Participant and the Company or an Affiliate, as determined by the Committee or any officer designated by it, in its, his or her sole discretion. The determination of the Committee or such designated officer as to the existence of Cause will be conclusive on the LTIP Participant and the Company.

 

 

 

 

 

b)

 

Change in Control . Any of the following events: (i) the purchase or other acquisition by any person, entity or group of persons, within the meaning of Section 13(d) or 14(d) of the Securities Exchange Act of 1934 (the “Act”) (excluding, for this purpose, the Company, its Affiliates and any employee benefit plan (or related trust) of the Company or its Affiliates), of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Act) of 50% or more of the combined voting power of the Company’s then-

 


 

 

 

 

outstanding voting securities entitled to vote generally in the election of directors in any transaction or series of transactions; (ii) when individuals who, as of the effective date of the LTIP, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board, provided that any person who becomes a director subsequent to the effective date of the LTIP whose election, or nomination for election by the Company’s shareholders, was approved in advance by a vote of at least a majority of the directors then comprising the Incumbent Board excluding members of its Incumbent Board who are no longer serving as directors shall be, for purposes of this section, considered as though such person were a member of the Incumbent Board; provided, however, the following persons shall not be considered members of the Incumbent Board: (a) individuals whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of directors of the Company, as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Act and (b) individuals approved by the Incumbent Board as a result of an agreement intended to avoid or settle an actual or threatened contest; (iii) consummation of a reorganization, merger or consolidation, except in each case following such reorganization, merger or consolidation: (a) persons who were the shareholders of the Company immediately prior to such reorganization, merger or consolidation immediately thereafter own more than 50% of the combined voting power entitled to vote generally in the election of directors of the reorganized, merged or consolidated corporation’s then-outstanding voting securities, and (b) a majority of members of the board or other governing body of such reorganized, merged or consolidated corporation were members of the Incumbent Board at the time of the execution of the initial agreement or the approval of the transaction by the Board; (iv) approval by shareholders of a liquidation or dissolution of the Company (and the Company shall commence such liquidation or dissolution), or consummation of the sale of all or substantially all of the assets of the Company (in one transaction or a series of transactions); or (v) any other event that a majority of the members of the Incumbent Board, in their sole discretion, shall determine may constitute a Change in Control.

 

 

 

 

 

c)

 

Choice Award. An award that provides designated LTIP Participants with the choice to receive the award in a) Restricted Stock, b) Stock Options, or c) a combination of Restricted Stock and Stock Options.

 

 

 

 

 

d)

 

Committee. The Compensation and Stock Option Committee of the Board of Directors of the Company, or any successor committee designated by such Board to assume the responsibilities for the administration of this LTIP.

 

 

 

 

 

e)

 

Deferred Annual Bonus Match Award . A deferred bonus that is awarded to designated LTIP participants based on a percentage of the LTIP Participant’s earned annual bonus as determined in accordance with Section 8(a.)

 

 

 

 

 

f)

 

Disability . Permanent and total disability as defined in Section 22(e)(3) of the Code.

 

 

 

 

 

g)

 

Fair Market Value . With respect to Common Stock:

-2-


 

 

 

(i)

 

if the Common Stock is listed on a national securities exchange or traded in the over-the counter market and sales prices are regularly reported for the Common Stock, the closing or last price of the Common Stock on the Composite Tape or other comparable reporting system on the date of grant or determination;

 

 

 

 

 

(ii)

 

if the Common Stock is not traded on a national securities exchange but is traded on the over-the-counter market, if sales prices are not regularly reported for the Common Stock for the trading day referred to in Section 2(g)(i), and if bid and asked prices for the Common Stock are regularly reported, the mean between the bid and the asked price for the Common Stock at the close of trading in the over-the-counter market for the trading day on which Common Stock was traded on the date of grant or determination; and

 

 

 

 

 

(iii)

 

if the Common Stock is neither listed on a national securities exchange nor traded in the over-the-counter market, such value as the Committee, in good faith, shall determine.

 

 

g)

 

LTIP Award . Any Performance Award, Restricted Stock, Choice Award or Deferred Annual Bonus Match awarded to an LTIP Participant in accordance with Section 5, 6, 7 or 8.

 

 

 

 

 

h)

 

LTIP Participant . A director, employee or consultant of the Company or any Affiliate as designated in Section 4 for participation in one or more programs under the LTIP; provided, however, that with respect to any awards under the 1992 Plan (e.g., Performance Awards or Restricted Stock) or the 2001 Plan (e.g., Choice Awards), only those persons eligible for those awards under those respective plans may receive such awards under the LTIP.

 

 

 

 

 

i)

 

Stock Option . A non-statutory stock option granted pursuant to an LTIP Participant’s election of such option in accordance with Section 7.

 

 

 

 

 

j)

 

Performance Award . An award determined in accordance with Section 5(a) and payable to designated LTIP Participants on the basis of the achievement of Performance Goals for a Performance Period.

 

 

 

 

 

k)

 

Performance Goal . One or more goals, which may include financial and non-financial measures, established by the Committee for a Performance Period.

 

 

 

 

 

l)

 

Performance Period . One or more periods of time, which may be varying and overlapping durations, as the Committee may select, over which the attainment of one or more Performance Goals will be measured for purposes of determining an LTIP Participant’s right to and the payment of any Performance Awards.

-3-


 

 

m)

 

Restricted Stock Award . An award determined in accordance with Section 6.

Section 3. Administration of LTIP

The LTIP shall be administered by the Committee, and all interpretations and decisions with respect to the application of LTIP shall be at the sole discretion of the Committee. The Committee shall have the authority to determine the terms and conditions, including but not limited to any restrictions and vesting conditions related to LTIP Awards or any required acknowledgments or agreements for any awards, not inconsistent with the terms of the LTIP and 1992 Plan or 2001 Plan, as applicable, and to approve the form of written instruments and the terms and conditions evidencing LTIP Awards. The Committee may at any time adopt, alter and repeal such administrative rules, guidelines and practices governing the operation of the LTIP as it shall from time to time decide. To the extent permitted by applicable law and the 1992 Plan and the 2001 Plan, the Committee, in its sole discretion, may delegate to the Chief Executive Officer and/or other designated officers of the Company all or part of the Committee’s authority and duties with respect to the granting of LTIP Awards.

All decisions and interpretations of the Committee shall be binding on all persons, including the Company and LTIP Participants.

Section 4. Eligibility and Participation in LTIP .

Except as provided by law or in the 1992 Plan or 2001 Plan, the Chief Executive Officer and/or other officers of the Company appointed by the Committee from time to time shall designate eligible individuals for participation in the LTIP, and the LTIP Award(s) for which such individuals shall be eligible, in his or their sole discretion, subject to the approval of the Committee; provided, however, that the LTIP participation of the Chief Executive Officer shall be determined by the Committee.

Section 5. Performance Award.

An LTIP Participant shall be eligible for Performance Awards, if so selected by the Committee or its delegatee, in accordance with the following guidelines (which may be adjusted by the Committee from time to time in its sole discretion with respect to one or more LTIP Participants and which may not be uniform among LTIP Participants for each award):

 

a)

 

Target Award . For each Performance Period, a designated LTIP Participant as determined as of the first day of the Performance Period and to whom the Committee determines, in its sole discretion, to grant a Performance Award under this Section 5(a) shall be granted a target Performance Award equal to a percentage of his or her annualized base salary in effect as of the first day of the first fiscal year in the Performance Period, or date of hire, if later, or such other date if so determined by the Committee. To the ext


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