FLOWERS FOODS, INC.
2001 EQUITY AND PERFORMANCE INCENTIVE PLAN
Form of 2009 Nonqualified
Stock Option Agreement
WHEREAS,
__________________ (the “ Optionee ”) is an
employee of Flowers Foods, Inc. (the “ Company
”) or a Subsidiary (as defined below);
WHEREAS,
the grant of a stock option to the Optionee has been duly
authorized by a resolution of the Committee (as defined below) duly
adopted on ____________, 2009 (the “ Date of Grant
”); and
WHEREAS,
the option granted hereunder is intended to be a nonqualified stock
option and will not be treated as an “incentive stock
option” within the meaning of that term under
Section 422 of the Internal Revenue Code of 1986, as amended
(the “ Code ”).
NOW,
THEREFORE, pursuant to the Flowers Foods, Inc. 2001 Equity and
Performance Incentive Plan (the “ Plan ”), the
Company hereby grants to the Optionee an option (the “
Option ”) pursuant to this 2009 Nonqualified Stock
Option Agreement (this “ Agreement ”) to
purchase ____________ shares of the Company’s common
stock, par value $.01 per share (“ Common Stock
”), at the price of $____________ per share (the
“ Option Price ”), and agrees to cause
certificates for any shares of Common Stock purchased hereunder to
be delivered to the Optionee upon full payment of the Option Price,
subject to the applicable terms and conditions of the Plan and this
Agreement.
1.
Exercise of Option; Vesting .
(a) Unless
and until terminated as hereinafter provided, the Option will
become exercisable in full on the third anniversary of the Date of
Grant so long as the Optionee remains in the continuous employ of
the Company or a Subsidiary until said date. For the purposes of
this Agreement, the continuous employment of the Optionee with the
Company or a Subsidiary will not be deemed to have been
interrupted, and the Optionee will not be deemed to have ceased to
be an employee of the Company or a Subsidiary, by reason of
(i) the termination of his employment by the Company or a
Subsidiary and immediate rehire by the Company (if the Company was
not the original employer) or by another Subsidiary or (ii) an
approved leave of absence. To the extent that the Option will have
so become exercisable, it may be exercised in whole or in part from
time to time by notice in writing and payment of the Option Price;
provided, however, that any such exercise may occur only once
during each calendar year during the term of the Option as set
forth herein.
(b) In
the event, however, that prior to the Option becoming exercisable
in full the Optionee shall be demoted from the position of
employment held by the Optionee on the Date of Grant to a position
which would not have been eligible for a Grant pursuant to the
Committee’s guidelines as of the Date of Grant, then the
Optionee shall forfeit a fraction of the Common Stock, but shall be
entitled to retain the remaining fraction of the Common Stock
covered by the Option, subject to the provisions of this agreement,
which is equal to the number of the Company’s fiscal quarters
in which the Optionee is employed in the position held by the
Optionee on the Date of Grant (beginning with the Date of Grant and
terminating with the
quarter in
which or with which demotion occurs) divided by twelve.
Notwithstanding the foregoing, solely for purposes of this
Agreement, an apparent demotion from the position of employment
held by the Optionee on the Date of Grant shall nonetheless not be
deemed to constitute a demotion if the Committee so
determines.
(c) Notwithstanding
the provisions of Subsection (a) of this Section, the Option
will become immediately exercisable in full upon the occurrence of
a Change in Control (as defined below) of the Company, or death,
Disability (as defined below) or Retirement (as defined below) of
the Optionee prior to the time the Option would otherwise vest
hereunder. The Committee may provide for accelerated vesting of the
Option in other circumstances, in its discretion.
2.
Payment of Option Price . The Option Price is payable
in cash or by certified or cashier’s check or other cash
equivalent acceptable to the Company payable to the order of the
Company. The requirement of payment in cash will be deemed
satisfied if the Optionee has made arrangements satisfactory to the
Company with a bank or broker that is a member of the National
Association of Securities Dealers, Inc. to sell on the date of
exercise a sufficient number of shares of Common Stock being
purchased so that the net proceeds of the sale transaction will at
least equal the aggregate Option Price and pursuant to which the
bank or broker undertakes to deliver the aggregate Option Price to
the Company not later than the date on which the sale transaction
will settle in the ordinary course of business.
3.
Term of Option . An Option which is not, or does not
become, exercisable upon the date of termination of employment with
the Company will terminate as of said date. An Option which is
exercisable will terminate on the earliest of the following
dates:
(a) Three
(3) months after the Optionee ceases to be an employee of the
Company or a Subsidiary for any reason other than Retirement,
death, Disability, voluntary termination without the written
consent of the Company, or termination for Cause (as defined
below);
(b) Two
(2) years from the date of termination of employment because
of Disability, death, or from the date of Retirement, if the
Optionee becomes disabled, dies or retires while an employee of the
Company or a Subsidiary;
(c) Seven
(7) years from the Date of Grant; or
(d) The
effective date of the Optionee’s termination of employment
for Cause, or voluntary termination without the Company’s
written consent.
(e) Notwithstanding
the provisions of Section 3(a) and 3(b), if the Optionee dies
within the applicable period for exercise, the Option will expire
two (2) years from the date of death.
The
Optionee shall nonetheless forfeit the entire Option if, during the
applicable period for exercise Optionee enters into competition
with the Company through employment with, rendering of services for
compensation to, or ownership of more than five percent
(5%)
2
interest in any
entity which is engaged in a business field in which the Company or
any Subsidiary, is also engaged. The Committee may waive this
noncompetition requirement.
4.
Restrictions on Transfer of Option .
(a) Except
as otherwise permitted by the Plan, the Option may not be
transferred except by will or the laws of descent and distribution
and may not be exercised during the lifetime of the Optionee except
by the Optionee or the Optionee’s guardian or legal
representative acting on behalf of the Optionee in a fiduciary
capacity under state law and court supervision.
(b) To
the extent the Option or a portion thereof remains unvested due to
a restriction of future performance of services or any other
restriction, the Optionee shall not have the right to sell,
transfer, assign, convey, pledge, hypothecate, grant any security
interest in or mortgage on, or otherwise dispose of or encumber any
unvested portion of the Option or any interest therein. As a result
of the retention of rights in the Option by the Company, except as
required by any law, neither any unvested portion of the Option nor
any interest therein shall be subject in any manner to any forced
or involuntary sale, transfer, conveyance, pledge, hypothecation,
encumbrance, or other disposition or to any charge, liability,
debt, or any other obligation of the Optionee, whether as a direct
or indirect result of any action of the Optionee or any action
taken in any proceeding, including but not limited to any
proceeding under any divorce, bankruptcy or other creditors’
rights law. Any action attempting to effect a transaction of such
type shall be void.
5.
Compliance with Law . The Company will make
reasonable efforts to comply with all applicable federal and state
securities laws; provided, however, notwithstanding any other
provision of this Agreement, the Company will not be obligated to
issue any Common Stock pursuant to this Agreement if the issuance
thereof would result in a violation of any such law.
6.
Adjustments . The Committee may make any adjustments
in the Option Price and in the number and kind of shares of stock
or other securities covered by this Agreement that the Committee
may determine to be equitably required to prevent dilution or
enlargement of the Optionee’s rights under this Agreement
that would otherwise result from any (a) stock dividend, stock
split, combination of shares, recapitalization or other change in
the capital structure of the Company, (b) merger,
consolidation, spin-off, spin-out, split-off, split-up,
reorganization, partial or complete liquidation or other
distribution of assets, issuance of rights or warrants to purchase
securities or (c) other corporate transaction or event having
an effect similar to any of the foregoing. Furthermore, in the
event of any transaction or event described or referred to in the
immediately preceding sentence, the Committee may provide in
substitution for any or all of the
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