EXHIBIT 4.3
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EL CHICO RESTAURANTS, INC.
NONSTATUTORY STOCK OPTION AGREEMENT
THIS AGREEMENT is made and entered into this _____ day of
_____________, 19___, between El Chico Restaurants, Inc., a Texas corporation
(the "Company"), and __________________ (the "Holder") in connection with the
grant of a Nonstatutory Option (hereinafter defined) under the El Chico
Restaurants, Inc. 1995 Stock Plan (the "Plan").
W I T N E S S E T H:
WHEREAS, the Holder is either an employee of the Company or one of its
Affiliates (hereinafter defined) in a key position or a director of the Company
or one of its Affiliates and the Company desires to encourage him to own Stock
(hereinafter defined) and to give him added incentive to advance the interests
of the Company through the Plan and desires to grant the Holder a Nonstatutory
Option to purchase shares of Stock of the Company under terms and conditions
established by the Committee (hereinafter defined) and/or the Plan.
NOW, THEREFORE, in consideration of these premises, the parties agree
that the following shall constitute the Agreement between the Company and the
Holder:
1. DEFINITIONS. For purposes of this Agreement, the following
terms shall have the meanings specified below:
1.1 "AFFILIATES" shall mean (a) any corporation, other than
the Company, in an unbroken chain of corporations ending with the Company if
each of the corporations, other than the Company, owns stock possessing fifty
percent (50%) or more of the total combined voting power of all classes of stock
in one of the other corporations in such chain and (b) any corporation, other
than the Company, in an unbroken chain of corporations beginning with the
Company if each of the corporations, other than the last corporation in the
unbroken chain, owns stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.
1.2 "BOARD OF DIRECTORS" shall mean the board of directors
of the Company.
1.3 "CODE" shall mean the Internal Revenue Code of 1986,
as amended.
1.4 "COMMITTEE" shall mean the committee appointed pursuant to
Paragraph 3 of the Plan by the Board of Directors to administer the Plan.
1.5 "EXCHANGE ACT" shall mean the Securities Exchange Act
of 1934, as amended.
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1.6 "FAIR MARKET VALUE" shall mean:
(a) If shares of Stock of the same class are listed or admitted to
unlisted trading privileges on any national or regional securities exchange at
the date of determining the Fair market Value, the last reported sale price on
such exchange on the last business day prior to the date in question; or
(b) If shares of Stock of the same class shall not be listed or
admitted to unlisted trading privileges as provided in subparagraph 1.6(a) and
sales prices therefor in the over-the-counter market shall be reported by the
National Association of Securities Dealers, Inc. Automated Quotations, Inc.
("NASDAQ") National Market System at the date of determining the Fair market
Value, the last reported sale price so reported on the last business day prior
to the date in question; or
(c) If shares of Stock of the same class shall not be listed or
admitted to unlisted trading privileges as provided in subparagraph 1.6(a) and
sales prices therefor shall not be reported by the NASDAQ National Market System
as provided in subparagraph 1.6(b), and bid and asked prices therefor in the
over-the-counter market shall be reported by NASDAQ (or, if not so reported, by
the National Quotation Bureau Incorporated) at the date of determining the Fair
market Value, the average of the closing bid and asked prices on the last
business day prior to the date in question; and
(d) If shares of Stock of the same class shall not be listed or
admitted to unlisted trading privileges as provided in subparagraph 1.6(a) and
sales prices or bid and asked prices therefor shall not be reported by NASDAQ
(or the National quotation Bureau Incorporated) as provided in subparagraph
1.6(b) or subparagraph 1.6(c) at the date of determining the Fair market Value,
the value determined in good faith by the Board of Directors.
1.7 "NONSTATUTORY OPTION" shall mean a stock option that does not
satisfy the requirements of Section 422 of the Code.
1.8 "SECURITIES ACT" shall mean the Securities Act of 1933, as amended.
1.9 "STOCK" shall mean the Company's authorized $0.10 par value common
stock, together with any other securities with respect to which Options granted
hereunder may become exercisable.
2. GRANT OF NONSTATUTORY OPTION. Subject to the terms and conditions
set forth herein, the Company grants to the Holder a Nonstatutory Option (Grant
Number ____) to purchase from the Company during the period ending ______ (___)
years from the date of this Agreement, _______ shares of Stock at a price of
$______ per share, subject to adjustment as provided in Paragraph 8 hereof. This
Nonstatutory Option is exercisable with respect to the shares of Stock indicated
as following, except as provided in Paragraphs 7 and 8:
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ON OR AFTER NUMBER OF SHARES
_____shares of Stock
____ additional shares of Stock
____ additional shares of Stock
____ additional shares of Stock
____ additional shares of Stock
3. NOTICE OF EXERCISE. This Nonstatutory Option may be exercised
in whole or in part, from time to time, in accordance with Paragraph 2, by
written notice to the Company at the address provided in Paragraph 11, which
notice shall:
(a) specify the Grant Number, the number of shares of Stock to
be purchased and the exercise price to be paid therefor;
(b) if the person exercising this Nonstatutory Option is not
the Holder himself, contain or be accompanied by evidence satisfactory to the
Committee of such person's right to exercise this Nonstatutory Option; and
(c) be accompanied by (i) payment in full of the exercise
price in the form of cash or a check payable to the order of the Company, (ii)
payment in the form of shares of Stock owned by the Holder for at least six
months and at least equal in value to the aggregate exercise price payable in
connection with such exercise, or (iii) a combination of (i) and (ii).
4. TRANSFER AND EXERCISE OF NONSTATUTORY OPTION. This Nonstatutory
Option shall not be transferable except by will or by the laws of descent and
distribution. During the Holder's lifetime, this Nonstatutory Option may be
exercised only by him. The Holder may not make any disposition of this
Nonstatutory Option, "disposition" means any sale, transfer, encumbrance, gift,
donation, assignment, pledge, hypothecation, or other disposition, whether
similar or dissimilar to those previously enumerated, whether voluntary or
involuntary, and whether during the Holder's lifetime or upon or after the
Holder's death, including, but not limited to, any disposition by operation of
law, by court order, by judicial process, or by foreclosure, levy, or
attachment, except a transfer by will or by the laws of descent or distribution.
Any attempted disposition in violation of this Paragraph 4 shall be void and
ineffective for all purposes.
5. STATUS OF HOLDER. The Holder shall not be deemed a shareholder of
the Company with respect to any of the shares of Stock subject to this
Nonstatutory Option, except to the extent that such shares shall have been
purchased and transferred to him. The Company shall not be required to issue or
transfer any certificates for shares of Stock purchased upon exercise of this
Nonstatutory Option until all applicable requirements of law have been complied
with and such
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shares shall have been duly listed on any securities exchange on which the Stock
may then be listed.
6. NO EFFECT ON CAPITAL STRUCTURE. This Nonstatutory Option shall not
affect the right of the Company or any Affiliate thereof to reclassify,
recapitalize or otherwise change its capital or debt structure or to merge,
consolidate, convey any or all of its assets, dissolve, liquidate, windup, or
otherwise reorganize.
7. PREMATURE EXPIRATION OF NONSTATUTORY OPTION.
(a) TERMINATION AS AN EMPLOYEE OR DIRECTOR - GENERAL. If the Holder
ceases to be employed by at least one of the employers in the group of employers
consisting of the Company and its Affiliates because the Holder voluntarily
terminates employment with such group of employers and the Holder does not
remain or thereupon become a director of the Company or one or more of its
Affiliates, or if a Holder voluntarily ceases to be a director of at least one
of the corporations in the group of corporations consisting of the Company and
its Affiliates and the Holder does not remain or thereupon become an employee of
the Company or one or more of its Affiliates, the Holder shall have the right
for thirty (30) days after such termination of employment or cessation of
directorship, whichever event occurs latest, to exercise this Nonstatutory
Option with respect to that portion hereof that has become exercisable pursuant
to this Agreement as of the date of the Holder's termination or cessation, and
thereafter this Nonstatutory Option shall terminate and cease to be exercisable.
If a Holder ceases to be employed by at least one of the employers in
the group of employers consisting of the Company and its Affiliates because any
of such entities terminates the Holder's employment for misconduct, the portion,
if any, of this Nonstatutory Option that remains unexercised, including that
portion, if any, that pursuant to this Agreement is not yet exercisable, at the
time of the Holder's termination of employment, shall terminate and cease to be
exercisable as of such time. "Misconduct" shall be as defined in the Company's
Personnel Policy and Procedures Manual.
If a Holder ceases to be employed by at least one of the employers in
the group of employers consisting of the Company and its Affiliates because one
or more of such entities terminates the employment of the Holder but not for
misconduct, and the Holder does not remain or thereupon become a director of the
Company or one or more of its Affiliates, or if the Holder is only a director
and ceases to be a director of at least one of the corporations in the group of
corporations consisting of the Company and its Affiliates, the Holder shall have
the right for ninety (90) days after such termination of employment or cessation
of directorship to exercise this Nonstatutory Option with respect to that
portion hereof that has become exercisable pursuant to this Agreement as of the
date of the Holder's termination or cessation, and thereafter this Nonstatutory
Option shall terminate and cease to be exercisable.
(b) TERMINATION AS AN EMPLOYEE OR DIRECTOR - DISABILITY. If the
Holder ceases to be employed by at least one of the employers in the group of
employers consisting of the Company and its Affiliates by reason of disability
(as defined in section 22(e)(3) of the Code) and
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does not remain or thereupon become a director of the Company or one or more of
its Affiliates, or if the Holder is only a director and ceases by reason of such
disability to be a director of at least one of the corporations in the group of
corporations consisting of the Company and its Affiliates, the Holder shall be
given an additional twelve (12) months after the date of termination of
employment with or cessation of directorship of such group of employers by
reason of disability, whichever occurs latest, to exercise this Nonstatutory
Option to the extent this Nonstatutory Option is exercisable on the date of such
termination of employment or cessation of directorship, and thereafter this
Nonstatutory Option shall terminate and cease to be exercisable.
(c) TERMINATION AS AN EMPLOYEE OR DIRECTOR - DEATH. If the Holder dies
while in the employ of the Company or an Affiliate or dies while a director of
the Company or an Affiliate, this Nonstatutory Option shall be exercisable by
the Holder's legal representatives, heirs, legatees, or distributees for twelve
(12) months following the date of the Holder's death to the extent this
Nonstatutory Option is exercisable on the Holder's date of death, and thereafter
this Nonstatutory Option shall terminate and cease to be exercisable.
8. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION, MERGER, ETC.
Notwithstanding any other provision hereof, in the event of any change in the
number of outstanding shares of Stock
(a) effected without receipt of consideration therefor by the
Company, by reason of a stock dividend, or split, combination, exchange of
shares or other recapitalization, merger, or otherwise, in which the Company is
the surviving corporation,
(b) by reason of a spin-off to the shareholders of a part
of the Company into a separate entity, or
(c) by reason of assumptions and conversions of
outstanding grants due to an acquisition by the Company of a separate entity;
then: (1) the number and class of shares subject to this Nonstatutory Option and
(2) the exercise price of this Nonstatutory Option shall be automatically
adjusted to accurately and equitably reflect the effect thereon of such change;
provided, however, that any fractional share resulting from such adjustment may
be eliminated. In the event of a dispute concerning such adjustment, the
decision of the Committee shall be conclusive. The number of shares subject to
this Nonstatutory Option shall be automatically reduced by any fraction included
therein which results from any adjustment made pursuant to this Paragraph 8.
The occurrence of:
(a) a dissolution or liquidation of the Company,
(b) a merger or consolidation (other than a merger effecting a
reincorporation of the Company in another state or any other merger or a
consolidation in which the shareholders of the surviving corporation and their
proportionate interests therein immediately after the merger
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or consolidation are substantially identical to the shareholders of the Company
and their proportionate interests therein immediately prior to the merger or
consolidation) in which the Company is not the surviving corporation (or
survives only as a subsidiary of another corporation in a transaction in which
the shareholders of the parent of the Company and their proportionate interests
therein immediately after the transaction are not substantially identical to the
shareholders of the Company and their proportionate interests therein
immediately prior to the transaction),
(c) a transaction in which any person becomes the owner
of 50% or more of the total combined voting power of all classes of stock of the
Company, or
(d) a sale of all or substantially all of the assets of the
Company where it is contemplated that within a reasonable period of time
thereafter the Company will either be liquidated or converted into a
nonoperating company or an extraordinary dividend will be declared resulting in
a partial liquidation of the Company (but in all cases only with respect to
those employees whom it is anticipated will lose their employment with the
Company and its Affiliates as a result of such sale of assets)
shall cause this Nonstatutory Option to terminate, but the Holder shall, in any
event, have the right, immediately prior to such dissolution, liquidation,
merger, consolidation, or transaction, to exercise this Nonstatutory Option, to
the extent not theretofore exercised, without regard to the determination as to
the periods and installments of exercisability made pursuant to Paragraph 2 if
(and only if) this Nonstatutory Option has not at that time expired or been
terminated.
9. COMMITTEE AUTHORITY. Any question concerning the
interpretation of this Agreement, any adjustments required to be made under
Paragraph 8 of this Agreement, and any controversy which may arise under this
Agreement shall be determined by the Committee in its sole and absolute
discretion. Such decision of the Committee shall be final and binding.
10. PLAN CONTROLS. The terms of this Agreement are governed by the
terms of the Plan, a copy of which is attached hereto as Exhibit A and made a
part hereof as if fully set forth herein, and in the case of any inconsistency
between the terms of this Agreement and the terms of the Plan, the terms of the
Plan shall control.
11. NOTICE. Whenever any notice is required or permitted hereunder,
such notice must be in writing and personally delivered or sent by mail. Any
notice required or permitted to be delivered hereunder shall be deemed to
delivered on the date which it is personally delivered, or, whether actually
received or not, on the third business day after it is deposited in the United
States mail, certified or registered, postage prepaid, addressed to the person
who is to receive it at the address which such person has theretofore specified
by written notice delivered in accordance herewith. The Company or Holder may
change, at any time and from time to time, by written notice to the other, the
address previously specified for receiving notices. Until changed in accordance
herewith, the Company and the Holder specify their respective addresses as set
forth below:
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Company: El Chico Restaurants, Inc.
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Attn: Legal Dept.
Holder:
12. INFORMATION CONFIDENTIAL. As partial consideration for the granting
of this Nonstatutory Option, the Holder agrees that he will keep confidential
all information and knowledge that he has relating to the manner and amount of
his participation in the Plan; provided, however, that such information may be
disclosed as required by law and may be given in confidence to the Holder's
spouse, tax and financial advisors, or to a financial institution to the extent
that such information is necessary to secure a loan.
13. GOVERNING LAW. Except as is otherwise provided in Paragraph
11.18 of the Plan, where applicable, the provisions of this Agreement shall be
governed by the contract law of the State of Texas.
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IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed and the Holder has hereunto set his hand on the day and year first
above written.
EL CHICO RESTAURANTS, INC.
By:
Its:
HOLDER:
Print Name:
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