EXHIBIT 10.1
GRILL CONCEPTS, INC.
INCENTIVE STOCK OPTION AGREEMENT
This Incentive Stock Option Agreement (Option Agreement) is between Grill
Concepts, Inc., a Delaware corporation (the "Company''), and
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("Optionee"), who agree as follows:
Section 1. Introduction. The Company has heretofore adopted the Grill
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Concepts, Inc. 1998 Stock Option Plan (the "Plan") for the purpose of providing
eligible key employees, consultants and directors of the Company and its
Affiliates (as defined in the Plan) with increased incentive to render services,
to exert maximum effort for the business success of the Company and to
strengthen the identification of employees, consultants and directors with the
shareholders. The Company, acting through the Compensation Committee of its
Board of Directors (the "Committee"), has determined that its interests will be
advanced by the issuance to Optionee of an incentive stock option under the
Plan.
Section2. Option.Subject to the terms and conditions contained herein, the
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Company hereby irrevocably grants to Optionee the right and option ("Option") to
purchase from the Company shares of the Company's common stock, $.00004
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par value ("Common Stock''), at a price of $ per share, which is deemed to
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be not less than the fair market value of the Common Stock at the date of grant
of this Option.
Section 3. Option Period.The Option herein granted may be exercised by
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Optionee in whole or in part at any time during a 10 year period beginning on
(the Option Period), subject to the limitation that said Option shall
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not be exercisable for more than a percentage of the aggregate number of shares
offered by this Option determined as follows:
(a) commencing one year from the date of commencement of the Option
Period, twenty percent (20%) of the shares offered by this Option may
be purchased.
(b) commencing two years from the date of commencement of the Option
Period, an additional twenty percent (20%) of the shares offered by
this Option may be purchased.
(c) commencing three years from the date of commencement of the
Option Period, an additional twenty percent (20%) of the shares
offered by this Option may be purchased.
(d) commencing four years from the date of commencement of the Option
Period, an additional twenty percent (20%) of the shares offered by
this Option may be purchased.
(e) commencing five years from the date of commencement of the Option
Period, an additional twenty percent (20%) of the shares offered by
this Option may be purchased
Notwithstanding anything in this Option Agreement to the contrary, the
Committee, in its sole discretion may waive the foregoing schedule of vesting
and upon written notice to Optionee, accelerate the earliest date or dates on
which any of the Options granted hereunder are exercisable.
SECTION 4. PROCEDURE FOR EXERCISE. The Option herein granted may be
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exercised by the delivery by Optionee of written notice to the Secretary of the
Company setting forth the number of shares of Common Stock with respect to which
the Option is being exercised. The notice shall be accompanied by, at the
election of the Optionee, (i) cash, cashier's check, bank draft, or postal or
express money order payable to the order of the Company, (ii) certificates
representing shares of Common Stock theretofore owned by Optionee duly endorsed
for transfer to the Company, (iii) if approved by the Committee, a copy of
irrevocable instructions to a broker to deliver promptly to the Company the
amount of sale or loan proceeds necessary to pay the exercise price of the
Options being exercised or such other form of payment of the exercise price of
this Option as the Committee shall, in its sole and absolute discretion,
determine to be acceptable, or (iv) any combination of the preceding, equal in
value to the aggregate exercise price. Notice may also be delivered by telecopy
provided that the exercise price of such shares is received by the Company via
wire transfer on the same day the telecopy transmission is received by the
Company. The notice shall specify the address to which the certificates for such
shares are to be mailed. An option to purchase of Common Stock in accordance
with this Plan, shall be deemed to have been exercised immediately prior to the
close of business on the date (i) written notice of such exercise and (ii)
payment in full of the exercise price for the number of share for which Options
are being exercised, are both received by the Company and Optionee shall be
treated for all purposes as the record holder of such shares of Common Stock as
of such date.
As promptly as practicable after receipt of such written notice and
payment, the Company shall deliver to Optionee certificates for the number of
shares with respect to which such Option has been so exercised, issued in
Optionee's name or such other name as Optionee directs; provided, however, that
such delivery shall be deemed effected for all purposes when a stock transfer
agent of the Company shall have deposited such certificates in the United States
mail, addressed to Optionee at the address specified pursuant to this Section 4.
SECTION 5. TERMINATION OF EMPLOYMENT. If Optionee ceases to be employed by
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the Company or its Affiliates for any reason other than death or disability any
Option which is exercisable on the date of such termination of employment shall
expire three-months from such date of termination of employment; provided,
however, the Committee, in its sole discretion, may allow -an Optionee to
exercise all or a portion of the Options granted but unexercised for a period of
time after Optionee's termination of employment.
SECTION 6. DISABILITV OR DEATH. In the event Optionee dies or is
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determined to be disabled while Optionee is employed by the Company, the options
previously granted to Optionee may be exercised (to the extent Optionee would
have been entitled to do so at the date of death or the determination of
disability) at any time and from time to time, within a three-month period after
such death or determination of disability, by the Optionee, the guardian of
Optionee's estate, the executor or administrator of Optionee's estate or by the
person or persons to whom Optionee's rights under this Option Agreement shall
pass by will or the laws of descent and distribution, but in no event may the
Option be exercised after its expiration under the terms of this Option
Agreement. An Optionee shall be deemed to be disabled if, in the opinion of a
physician selected by the Cornmittee, Optionee is incapable of performing
services for the Company of the kind Optionee was performing at the time the
disability occurred by reason of any medically determinable physical or mental
impairment which can be expected to result in death or to be of long, continued
and indefinite duration. The date of determination of disability for purposes
hereof shall be the date of such determination by such physician.
SECTION 7. TRANSFERABILITY. This Option shall not be transferable by
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Optionee otherwise than by Optionee's will or by the laws of descent and
distribution or pursuant to a qualified domestic relations order as defined in
the Code or Title I of the Employee Retirement Income Security Act, as amended,
or the rules thereunder. During the lifetime of Optionee, the Option shall be
exercisable only by Optionee. Any heir or legatee of Optionee shall take rights
herein granted subject to the terms and conditions hereof. No such transfer of
this Option Agreement to heirs or legatees of Optionee shall be effective to
bind the Company unless the Company shall have been furnished with written
notice thereof and a copy of such evidence as the Committee may deem necessary
to establish the validity of the transfer and the acceptance by the transferee
or transferees of the terms and conditions hereof
SECTION 8. NO RIGHTS AS SHAREHOLDER. Optionee shall have no rights
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as a shareholder with respect to any shares of Common Stock covered by this
Option Agreement until the Option is exercised by written notice and accompanied
by payment as provided in Section 4 of this Option Agreement.
SECTION 9. EXTRAORDINARY CORPORATE TRANSACTIONS. The existence of
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outstanding Options shall not affect in any way the right or power of the
Company or it's shareholders to make or authorize any or all adjustments,
recapitalizations, reorganization or other changes in the Company's capital
structure or its business, or any merger or consolidation of the Company, or any
issuance of Common Stock or subscription rights thereto, or any issuance of
bonds, debentures, preferred or prior preference stock ahead of or affecting the
Common Stock or the rights thereof, or the dissolution or liquidation of the
Company, or any sale or transfer of all or any part of its assets or business,
or any other corporate act or proceedings, whether of a similar character or
otherwise. If the Company recapitalizes or otherwise changes its capital
structure, or merges, consolidates, sells all of its assets or dissolves (each
of the foregoing a 'Fundamental Change`), then thereafter upon any exercise of
the Option, Optionee shall be entitled to purchase under the Option, in lieu of
the number of shares of Common Stock as to which the Option shall then be
exercisable, the number and class of shares of stock and securities to which
Optionee would have been entitled pursuant to the terms of the Fundamental
Change if, immediately prior to such Fundamental Change, Optionee had been the
holder of record of the number of shares of Common Stock as to which the Option
is then exercisable. If (i) the Company shall not be the surviving entity in any
merger or consolidation (or survives only as a subsidiary of another entity),
(ii) the Company sells all or substantially all of its assets to any other
person or entity (other than a wholly-owned subsidiary), (iii) any person or
entity (including a "group" as contemplated by Section 13(d)(3) of the Exchange
Act) acquires or gains ownership or control of (including, without limitation,
power to vote) more than 50% of the outstanding shares of Common Stock, (iv) the
Company is to be dissolved and liquidated, or (v) as a result of or in
connection with a contested election of directors, the persons who were
directors of the Company before such election shall cease to constitute a
majority of the Board (each such event in clauses (i) through (v) above is
referred to herein as a "Corporate Change"), the committee, in its sole
discretion, may accelerate the time at which all or a portion of Optionee's
Option may be exercised for a limited period of time before or after a specified
date.
SECTION 10. CHANGES IN CAPITAL STRUCTURE.If the outstanding shares of
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Common Stock or other securities of the Company, or both, for which the Option
is then exercisable shall at any time be changed or exchanged by declaration of
a stock dividend, stock split, combination of shares, or recapitalization, the
number and kind of shares of Common Stock or other securities subject to the
Plan or subject to the Option and the exercise price, shall be appropriately and
equitably adjusted so as to maintain the proportionate number of shares or other
securities without changing the aggregate exercise price.
SECTION 11. COMPIIANCE WITH SECURITIES LAWS. Upon the acquisition of any
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shares pursuant to the exercise of the Option herein granted, Optionee (or any
person acting under Section 7) will enter into such written representations,
warranties and agreements as the Company may reasonably request in order to
comply with applicable securities laws or with this Option Agreement.
SECTION 12. COMPLIANCE WITH LAWS. Notwithstanding any of the other
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provisions hereof, Optionee agrees that he or she will not exercise the Option
granted hereby, and that the Company will not be obligated to issue any shares
pursuant to this Option Agreement, if the exercise of the Option or the issuance
of such shares of Common Stock would constitute a violation by Optionee or by
the Company of any provision of any law or regulation of any governmental
authority.
SECTION 13. NO RIGHT TO EMPLOYMENT Optionee who is an employee
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shall be considered to be in the employment of the Company so long as he or she
remains an employee of the Company or its Affiliates. Any questions as to
whether and when there has been a termination of such employment and the cause
of such termination shall be determine by the Committee, and its determination
shall be final. Nothing contained herein shall be construed as conferring upon
Optionee the right to continue in the employ of the Company, nor shall anything
contained herein be construed or interpreted to limit the ''employment at will"
relationship between Optionee and the Company.
SECTION 14. RESOLUTION OF ▇▇▇▇▇▇▇▇.▇▇ a condition of the granting of the
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Option hereby, Optionee, and Optionee's heirs, personal representations and
successors agree that any dispute or disagreement which may arise hereunder
shall be determined by the Committee in its sole discretion and judgment, and
that any such determination and any interpretation by the Committee of the terms
of this Option Agreement shall be final and shall be binding and conclusive, for
all purposes, upon the Company, Optionee, and Optionee's heirs, personal
representatives and successors.
SECTION 15. LEGENDS ON CERTIFICATE. The certificates representing the
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shares of Common Stock purchased by exercise of the Option will be stamped or
otherwise imprinted with legends in such form as the Company or its counsel may
require with respect to any applicable restrictions on sale or transfer and will
reflect stop-transfer instructions with respect to such shares.
SECTION 16. NOTICES. Every notice hereunder shall be in writing and shall
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be given by registered or certified mail. All notices of the exercise of any
Option hereunder shall be directed to Grill Concepts, Inc., ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Secretary. Any
notice given by the Company to Optionee directed to Optionee at the address on
file with the Company shall be effective to bind Optionee and any other person
who shall acquire rights hereunder. The Company shall be under no obligation
whatsoever to advise Optionee of the existence, maturity or termination of any
of Optionee's rights hereunder and Optionee shall be deemed to have familiarized
himself or herself with all matters contained herein and in the Plan which may
affect any of Optionee's rights or privileges hereunder.
SECTION 17. CONSTRUCTION AND INTERPRETATION. Whenever the term "
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Optionee'' is used herein under circumstances applicable to any other person or
persons to whom this award, in accordance with the provisions of Section 7
hereof, may be transferred, the word "Optionee", shall be deemed to include such
person or persons.
SECTION 18. NOTICE OF DISPOSITION. If Optionee disposes of any shares of
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Common Stock acquired pursuant to the exercise of an Option granted hereunder
prior to the earlier of (i) two years from the date of this Option Agreement or
(ii) one year from the date the shares of Common Stock were acquired, Optionee
shall notify the Company of such disposition within ten days of its occurrence
and deliver to the Company any amount of federal or state income tax withholding
required by law. Payment of the withholding shall be made in accordance with
Section 10 of the Plan. If the Optionee fails to pay the withholding tax, the
Company is authorized to withhold from any cash remuneration then or thereafter
payable to the Optionee any tax required to be withheld by reason of any
disposition named herein.
SECTION 19. AGREEMENT SUBJECT TO PLAN. This Option Agreement is subject
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to the Plan. The terms and provisions of the Plan (including any subsequent
amendments thereto) are hereby incorporated herein be reference thereto. In the
event of a conflict between any term or provision contained herein and a term or
provision of the Plan, the applicable terms and provisions of the Plan will
govern and prevail. All definitions of words and terms contained in the Plan
shall be applicable to this Option Agreement.
SECTION 20. BINDING EFFECT.This Option Agreement shall be binding upon and
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inure to the benefit of any successors to the Company and all persons lawfully
claiming under Optionee as provided herein.
IN WITNESS WHEREOF, this Incentive Stock Option Agreement has been
executed as of the day of .
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GRILL CONCEPTS, INC.
ATTEST:
By: /S/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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-------------------------- Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: President
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Name:
