As amended, May 25, 2006
and
July 23, 2009
PANERA BREAD COMPANY
2005 LONG-TERM INCENTIVE PROGRAM
(Sub-plan under 2006 Stock Incentive Plan)
Section 1.
Establishment .
Effective
September 1, 2005, Panera Bread Company (the
“Company”) established the Long-Term Incentive Program
(the “LTIP”) as a sub-plan under the Company’s
1992 Equity Incentive Plan (the “1992 Plan”) and the
Company’s 2001 Employee, Director and Consultant Stock Option
Plan (the “2001 Plan”). Effective May 25, 2006,
the Company will not grant any further awards under the 1992 Plan
or the 2001 Plan. Effective May 25, 2006, the LTIP will be a
sub-plan under the Company’s 2006 Stock Incentive Plan (the
“2006 Plan”). Notwithstanding anything to the contrary
herein, except to the extent permitted by the 2006 Plan, the
provisions of the 2006 Plan shall apply for purposes of the LTIP
with respect to any awards under the 2006 Plan.
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 stockholders.
Except to the
extent required by the 2006 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 2006 Plan.
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a)
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Cause . Cause shall include (and is not
limited to) dishonesty with respect to the Company or any affiliate
of the Company, 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 of the Company 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 of the
Company, 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.
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b)
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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 stockholders, 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
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case following such reorganization,
merger or consolidation: (a) persons who were the stockholders
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 stockholders 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.
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c)
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Choice Award . An award that provides designated
LTIP Participants with the choice to receive the award in a)
Restricted Stock, b) a Stock Settled Appreciation Right
(“SSAR”) (or, if determined by the Committee, Stock
Options), or c) a combination of Restricted Stock and a
SSAR.
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d)
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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.
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e)
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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.)
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f)
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Disability . Permanent and total disability as
defined in Section 22(e)(3) of the Code.
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g)
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Fair Market Value
. With respect to Common
Stock:
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(i)
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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;
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(ii)
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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
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(iii)
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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.
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g)
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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.
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h)
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LTIP Participant
. A director, employee
or consultant of the Company or any affiliate of the Company 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 2006 Plan, only those persons eligible for
those awards under those respective plans may receive such awards
under the LTIP.
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i)
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Stock Option . A non-statutory stock option
granted pursuant to an LTIP Participant’s election of such
option in accordance with Section 7.
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j)
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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.
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k)
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Performance Goal
. One or more goals,
which may include financial and non-financial measures, established
by the Committee for a Performance Period.
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l)
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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.
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m)
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Restricted Stock Award
. An award determined in
accordance with Section 6.
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n)
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Stock Settled Appreciation
Right . A
Stock Settled Appreciation Right (“SSAR”), granted
pursuant to an LTIP Participant’s election of such choice in
accordance with Section 7, is an award in the form of a right
to receive Common Stock, upon exercise of the SSAR, in an amount
equal to the appreciation in the value of the underlying Common
Stock over a base price established in the SSAR. The SSAR holder,
upon exercise, shall be entitled to receive an amount of Common
Stock equal to the quotient of (i) the product of (x) the
amount by which the Fair Market Value of the Common Stock on the
date of exercise exceeds the measurement price established pursuant
to the applicable SSAR agreement, provided that such measurement
price shall not be less than 100% of the Fair Market Value of the
Common Stock on the date of grant, multiplied by (y) the
number of shares of Common Stock subject to the SSAR being
exercised, divided by (ii) the Fair Market Value of the Common
Stock on the date of exercise. Each SSAR will be exercisable at
such times and subject to such terms and conditions as the
Committee may specify in the applicable SSAR agreement; provided,
however, that no SSAR will be granted for a term in excess of
10 years.
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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 2006 Plan,
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
2006 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 2006 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
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