RUBY TUESDAY, INC.
1996 STOCK INCENTIVE PLAN
(Restated as of September 30, 1999)
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TABLE OF CONTENTS
Page
SECTION 1 DEFINITIONS...................................................1
1.1 Definitions...................................................1
SECTION 2 THE STOCK INCENTIVE PLAN......................................4
2.1 Purpose of the Plan...........................................4
2.2 Stock Subject to the Plan.....................................4
2.3 Administration of the Plan....................................4
2.4 Eligibility and Limits........................................5
SECTION 3 TERMS OF STOCK INCENTIVES.....................................5
3.1 Terms and Conditions of All Stock Incentives..................5
3.2 Terms and Conditions of Options...............................7
(a) Option Price..............................................7
(b) Option Term...............................................8
(c) Payment...................................................8
(d) Conditions to the Exercise of an Option...................8
(e) Termination of Incentive Stock Option.....................8
(f) Special Provisions for Certain Substitute Options.........9
3.3 Terms and Conditions of Stock Appreciation Rights.............9
(a) Settlement................................................9
(b) Conditions to Exercise....................................9
3.4 Terms and Conditions of Stock Awards..........................9
3.5 Terms and Conditions of Dividend Equivalent Rights...........10
(a) Payment..................................................10
(b) Conditions to Payment....................................10
3.6 Terms and Conditions of Performance Unit Awards..............10
(a) Payment..................................................11
(b) Conditions to Payment....................................11
3.7 Terms and Conditions of Phantom Shares.......................11
(a) Payment..................................................11
(b) Conditions to Payment....................................11
3.8 Treatment of Awards Upon Termination of Service..............11
SECTION 4 RESTRICTIONS ON STOCK........................................12
4.1 Escrow of Shares.............................................12
4.2 Forfeiture of Shares.........................................12
4.3 Restrictions on Transfer.....................................12
SECTION 5 GENERAL PROVISIONS...........................................12
5.1 Withholding..................................................13
5.2 Changes in Capitalization; Merger; Liquidation...............13
5.3 Cash Awards..................................................14
5.4 Compliance with Code.........................................14
5.5 Right to Terminate Service...................................14
5.6 Restrictions on Delivery and Sale of Shares; Legends.........14
5.7 Non-alienation of Benefits...................................15
5.8 Termination and Amendment of the Plan........................15
5.9 Stockholder Approval.........................................15
5.10 Choice of Law................................................15
5.11 Effective Date of Plan.......................................15
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RUBY TUESDAY, INC.
1996 STOCK INCENTIVE PLAN
Ruby Tuesday, Inc., formerly known as Morrison Incorporated, originally
adopted the Morrison Incorporated Stock Incentive Plan which, in 1996, was last
amended and restated as the Morrison Restaurants Inc. 1996 Stock Incentive Plan
and subsequently renamed as the Ruby Tuesday, Inc. 1996 Stock Incentive Plan.
The purpose of this restatement is to incorporate into one document, as of
September 30, 1999, all amendments to the Ruby Tuesday, Inc. 1996 Stock
Incentive Plan that have been adopted subsequent to the last amendment and
restatement in 1996.
SECTION 1 DEFINITIONS
1.1......Definitions. Whenever used herein, the masculine pronoun shall
be deemed to include the feminine, and the singular to include the plural,
unless the context clearly indicates otherwise, and the following capitalized
words and phrases are used herein with the meaning thereafter ascribed:
(a)......"Board of Directors" means the board of directors of
the Company.
(b)......"Cause" has the same meaning as provided in the
employment agreement between the Participant and the Company or, if applicable,
any affiliate of the Company on the date of Termination of Service, or if no
such definition or employment agreement exists, "Cause" means conduct amounting
to (1) fraud or dishonesty against the Company or its affiliates, (2)
Participant's willful misconduct, repeated refusal to follow the reasonable
directions of the board of directors of the Company or its affiliates, or
knowing violation of law in the course of performance of the duties of
Participant's service with the Company or its affiliates, (3) repeated absences
from work without a reasonable excuse, (4) repeated intoxication with alcohol or
drugs while on the Company or affiliates' premises during regular business
hours, (5) a conviction or plea of guilty or nolo contendere to a felony or a
crime involving dishonesty, or (6) a breach or violation of the terms of any
agreement to which Participant and the Company or its affiliates are party.
(c)......"Change in Control" means any event that pursuant to
the Company's Certificate of Incorporation, as amended from time to time,
requires the affirmative vote of the holders of not less than eighty percent
(80%) of the Voting Stock (as defined therein); provided, however, that no event
shall constitute a Change in Control if approved by the Board of Directors a
majority of whom are present directors and new directors. For purposes of the
preceding sentence, the term "present directors" means individuals who as of the
date this Plan is adopted were members of the Board of Directors and the term
"new directors" means any director whose election by the Board of Directors in
the event of vacancy or whose nomination for election was approved by a vote of
at least three-fourths of the directors then still in office who are present
directors and new directors; provided that any director elected to the Board of
Directors solely to avoid or settle a threatened or actual proxy contest shall
in no event be deemed to be a new director.
(d)......"Code" means the Internal Revenue Code of 1986, as
amended.
(e)......"Committee" means the committee appointed by the
Board of Directors to administer the Plan pursuant to Plan Section 2.3.
(f)......"Company" means Ruby Tuesday, Inc., a Georgia
corporation, or its successor.
(g)......"Disability" has the same meaning as provided in the
long-term disability plan or policy maintained or, if applicable, most recently
maintained, by the Company or, if applicable, any affiliate of the Company for
the Participant. If no long-term disability plan or policy was ever maintained
on behalf of the Participant or, if the determination of Disability relates to
an Incentive Stock Option, Disability shall mean that condition described in
Code Section 22(e)(3), as amended from time to time. In the event of a dispute,
the determination of Disability shall be made by the Board of Directors and
shall be supported by advice of a physician competent in the area to which such
Disability relates.
(h)......"Disposition" means any conveyance, sale, transfer,
assignment, pledge or hypothecation, whether outright or as security, inter
vivos or testamentary, with or without consideration, voluntary or involuntary.
(i)......"Dividend Equivalent Rights" means certain rights
to receive cash payments as described in Plan Section 3.5.
(j)......"Fair Market Value" with regard to a date means the
closing price at which Stock shall have been sold on the last trading date prior
to that date as reported by a national securities exchange selected by the
Committee on which the shares of Stock are then actively traded and published in
The Wall Street Journal; provided that, for purposes of granting awards other
than Incentive Stock Options, Fair Market Value of the shares of Stock may be
determined by the Committee by reference to the average market value determined
over a period certain or as of specified dates, to a tender offer price for the
shares of Stock (if settlement of an award is triggered by such an event) or to
any other reasonable measure of fair market value.
(k)......"Incentive Stock Option" means an incentive stock
option, as defined in Code Section 422, described in Plan Section 3.2.
(l)......"Non-Qualified Stock Option" means a stock option,
other than an option qualifying as an Incentive Stock Option, described in Plan
Section 3.2.
(m)......"Option" means a Non-Qualified Stock Option or an
Incentive Stock Option.
(n)......"Over 10% Owner" means an individual who at the time
an Incentive Stock Option is granted owns Stock possessing more than 10% of the
total combined voting power of the Company or one of its Parents or
Subsidiaries, determined by applying the attribution rules of Code Section
424(d).
(o)......"Parent" means any corporation (other than the
Company) in an unbroken chain of corporations ending with the Company if, with
respect to Incentive Stock Options, at the time of granting of the Option, each
of the corporations other than the Company owns stock possessing 50% or more of
the total combined voting power of all classes of stock in one of the other
corporations in the chain.
(p)......"Participant" means an individual who receives a
Stock Incentive hereunder.
(q)......"Performance Unit Award" refers to a performance unit
award described in Plan Section 3.6.
(r)......"Phantom Shares" refers to the rights described in
Plan Section 3.7.
(s)......"Plan" means the Ruby Tuesday, Inc. 1996 Stock
Incentive Plan; provided, however, that in the event that the Company is
replaced by a successor in interest, the title of the Plan shall thereafter be
the name of the successor in interest followed by the phrase `1996 Stock
Incentive Plan'."
(t)......"Stock" means the Company's common stock, $.01 par
value.
(u)......"Stock Appreciation Right" means a stock appreciation
right described in Plan Section 3.3.
(v)......"Stock Award" means a stock award described in Plan
Section 3.4.
(w)......"Stock Incentive Agreement" means an agreement
between the Company and a Participant or other documentation evidencing an award
of a Stock Incentive.
(x)......"Stock Incentive Program" means a written program
established by the Committee pursuant to which Stock Incentives, other than
Options or Stock Appreciation Rights, are awarded under the Plan under uniform
terms, conditions and restrictions set forth in such written program and
distributed among eligible officers, employees and directors.
(y)......"Stock Incentives" means, collectively, Dividend
Equivalent Rights, Incentive Stock Options, Non-Qualified Stock Options,
Performance Unit Awards, Phantom Shares, Stock Appreciation Rights and Stock
Awards.
(z)......"Subsidiary" means any corporation (other than the
Company) in an unbroken chain of corporations beginning with the Company if,
with respect to Incentive Stock Options, at the time of the granting of the
Option, each of the corporations other than the last corporation in the unbroken
chain owns stock possessing 50% or more of the total combined voting power of
all classes of stock in one of the other corporations in the chain.
(aa)....."Termination of Service" means the termination of
either the employee-employer or director relationship, as the case may be,
between a Participant and the Company and its affiliates, regardless of the fact
that severance or similar payments are made to the Participant, for any reason,
including, but not by way of limitation, a termination by resignation,
discharge, death, Disability or retirement. The Committee shall, in its absolute
discretion, determine the effect of all matters and questions relating to
Termination of Service, including, but not by way of limitation, the question of
whether a leave of absence constitutes a Termination of Service, or whether a
Termination of Service is for Cause.
SECTION 2 THE STOCK INCENTIVE PLAN
2.1......Purpose of the Plan. The Plan is intended to (a) provide
incentive to officers, employees and directors of the Company and its affiliates
to stimulate their efforts toward the continued success of the Company and to
operate and manage the business in a manner that will provide for the long-term
growth and profitability of the Company; (b) encourage stock ownership by
officers, employees and directors by providing them with a means to acquire a
proprietary interest in the Company by acquiring shares of Stock or to receive
compensation which is based upon appreciation in the value of Stock; and (c)
provide a means of obtaining and rewarding key personnel.
2.2......Stock Subject to the Plan. Subject to adjustment in accordance
with Section 5.2, 6,000,000 shares of Stock (the `Maximum Plan Shares') are
hereby reserved exclusively for issuance pursuant to Stock Incentives. At no
time shall the Company have outstanding Stock Incentives and shares of Stock
issued in respect of Stock Incentives in excess of the Maximum Plan Shares. The
shares of Stock attributable to the nonvested, unpaid, unexercised, unconverted
or otherwise unsettled portion of any Stock Incentive that is forfeited or
cancelled or expires or terminates for any reason without becoming vested, paid,
exercised, converted or otherwise settled in full shall again be available for
purposes of the Plan. Notwithstanding any other provision in the Plan, five
percent (5%) of the shares of Stock reserved for issuance hereunder, subject to
adjustment in accordance with Section 5.2, may be granted hereafter without
regard to those provisions of the Plan that became effective on September 30,
1999.
2.3......Administration of the Plan. The Plan shall be administered by
the Committee. The Committee shall have full authority in its discretion to
determine the officers, employees and directors of the Company or its affiliates
to whom Stock Incentives shall be granted and the terms and provisions of Stock
Incentives, subject to the Plan. Subject to the provisions of the Plan, the
Committee shall have full and conclusive authority to interpret the Plan; to
prescribe, amend and rescind rules and regulations relating to the Plan; to
determine the terms and provisions of the respective Stock Incentive Agreements
or Stock Incentive Programs and to make all other determinations necessary or
advisable for the proper administration of the Plan. The Committee's
determinations under the Plan need not be uniform and may be made by it
selectively among persons who receive, or are eligible to receive, awards under
the Plan (whether or not such persons are similarly situated). The Committee's
decisions shall be final and binding on all Participants.
As to any matter involving a Participant who is not a "reporting
person" for purposes of Section 16 of the Securities Exchange Act of 1934,
Committee may delegate to any member of the Board of Directors or officer of the
Company the administrative authority to (a) interpret the provisions of the
Participant's Stock Incentive Agreement and (b) determine the treatment of Stock
Incentives upon a Termination of Service, as contemplated by Plan Section 3.8.
The Committee shall consist of at least two members of the Board of
Directors each of whom shall qualify as a "disinterested person," as defined in
Rule 16b-3 as promulgated under the Securities Exchange Act of 1934 and as an
"outside director," within the meaning of Code Section 162(m) and the
regulations promulgated thereunder. The Board of Directors may from time to time
remove members from or add members to the Committee. Vacancies on the Committee
shall be filled by the Board of Directors.
2.4......Eligibility and Limits. Effective September 30, 1999, Stock
Incentives may be granted only to officers, directors, and employees of the
Company or an affiliate; provided, however, that directors of the Company who
are not also employees of either the Company or an affiliate shall not be
eligible to receive Stock Incentives under the Plan. In the case of Incentive
Stock Options, the aggregate Fair Market Value (determined as at the date an
Incentive Stock Option is granted) of stock with respect to which stock options
intended to meet the requirements of Code Section 422 become exercisable for the
first time by an individual during any calendar year under all plans of the
Company and its Parents and Subsidiaries shall not exceed $100,000; provided
further, that if the limitation is exceeded, the Incentive Stock Option(s) which
cause the limitation to be exceeded shall be treated as Non-Qualified Stock
Option(s). To the extent required under Code Section 162(m) and the regulations
issued thereunder for compensation to be treated as qualified performance-based
compensation, the maximum number of shares of Stock with respect to which
Options or Stock Appreciation Rights may be granted during any single fiscal
year of the Company to any Participant who is a "covered employee" within the
meaning of Code Section 162(m) and the regulations promulgated thereunder (a
"Covered Employee"), shall not exceed 250,000.
SECTION 3 TERMS OF STOCK INCENTIVES
3.1......Terms and Conditions of All Stock Incentives.
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(a)......The number of shares of Stock as to which a Stock
Incentive shall be granted shall be determined by the Committee in its sole
discretion, subject to the provisions of Section 2.2 as to the total number of
shares available for grants under the Plan. If a Stock Incentive Agreement so
provides, a Participant may be granted a new Option to purchase a number of
shares of Stock equal to the number of previously owned shares of Stock tendered
in payment of the Exercise Price (as defined below) for each share of Stock
purchased pursuant to the terms of the Stock Incentive Agreement.
(b)......Each Stock Incentive shall be evidenced either by a
Stock Incentive Agreement in such form and containing such terms, conditions and
restrictions as the Committee may determine is appropriate or be made subject to
the terms of a Stock Incentive Program, containing such terms, conditions and
restrictions as the Committee may determine is appropriate. Each Stock Incentive
Agreement or Stock Incentive Program shall be subject to the terms of the Plan
and any provision in a Stock Incentive Agreement or Stock Incentive Program that
is inconsistent with the Plan shall be null and void.
(c)......The date a Stock Incentive is granted shall be the
date on which the Committee has approved the terms and conditions of the Stock
Incentive Agreement or Stock Incentive Program and has determined the recipient
of the Stock Incentive and the number of shares covered by the Stock Incentive
and has taken all such other action necessary to complete the grant of the Stock
Incentive.
(d)......The Committee may provide in any Stock Incentive
Agreement or pursuant to any Stock Incentive Program (or subsequent to the award
of a Stock Incentive but prior to its expiration or cancellation, as the case
may be) that, in the event of a Change in Control, the Stock Incentive shall or
may be cashed out on the basis of any price not greater than the highest price
paid for a share of Stock in any transaction reported by any national securities
exchange selected by the Committee on which the shares of Stock are then
actively traded during a specified period immediately preceding or including the
date of the Change in Control or offered for a share of Stock in any tender
offer occurring during a specified period immediately preceding or including the
date the tender offer commences; provided that, in no case shall any such
specified period exceed one (1) year (the "Change in Control Price"). For
purposes of this Subsection, the cash-out of a Stock Incentive shall be
determined as follows:
(i) Options shall be cashed out on the basis of
the excess, if any, of the Change in Control Price (but not more than the Fair
Market Value of the Stock on the date of the cash-out in the case of Incentive
Stock Options) over the Exercise Price with or without regard to whether the
Option may otherwise be exercisable only in part;
(ii) Stock Awards and Phantom Shares shall be
cashed out in an amount equal to the Change in Control Price with or without
regard to any conditions or restrictions otherwise applicable to any such Stock
Incentive; and
(iii) Stock Appreciation Rights, Dividend
Equivalent Rights and Performance Unit Awards shall be cashed out with or
without regard to any conditions or restrictions otherwise applicable to any
such Stock Incentive and the amount of the cash out shall be determined by
reference to the number of shares of Stock that would be required to pay the
Participant in kind for the value of the Stock Incentive as of the date of the
Change in Control multiplied by the Change in Control Price.
(e)......Any Stock Incentive may be granted in connection with
all or any portion of a previously or contemporaneously granted Stock Incentive.
Exercise or vesting of a Stock Incentive granted in connection with another
Stock Incentive may result in a pro rata surrender or cancellation of any
related Stock Incentive, as specified in the applicable Stock Incentive
Agreement or Stock Incentive Program.
(f)......Stock Incentives shall not be transferable or
assignable except by will or by the laws of descent and distribution and shall
be exercisable, during the Participant's lifetime, only by the Participant; in
the event of the Disability of the Participant, by the legal representative of
the Participant; or in the event of the death of the participant, by the
personal representative of the Participant's estate or if no personal
representative has been appointed, by the successor in interest determined under
the Participant's will.
3.2......Terms and Conditions of Options. Each Option granted under the
Plan shall be evidenced by a Stock Incentive Agreement. At the time any Option
is granted, the Committee shall determine whether the Option is to be an
Incentive Stock Option or a Non-Qualified Stock Option, and the Option shall be
clearly identified as to its status as an Incentive Stock Option or a
Non-Qualified Stock Option. At the time any Incentive Stock Option is exercised,
the Company shall be entitled to place a legend on the certificates representing
the shares of Stock purchased pursuant to the Option to clearly identify them as
shares of Stock purchased upon exercise of an Incentive Stock Option. An
Incentive Stock Option may only be granted within ten (10) years from the
earlier of the date the Plan, as amended and restated, is adopted or approved by
the Company's stockholders.
(a) Option Price.
------------
(i) Subject to adjustment in accordance with
Section 5.2 and the other provisions of this Section 3.2, the exercise price
(the "Exercise Price") per share of Stock purchasable under any Option shall be
as set forth in the applicable Stock Incentive Agreement. With respect to each
grant of an Option to a Participant, the Exercise Price per share shall not be
less than its Fair Market Value on the date the Option is granted.
Notwithstanding the immediately preceding sentence, with respect to each grant
of an Incentive Stock Option to a Participant who is an Over 10% Owner, the
Exercise Price per share shall not be less than 110% of its Fair Market Value on
the date the Option is granted.
(ii) For purposes of this Section 3.2(a), the
Fair Market Value of the Stock shall be determined (1) as of the date all of the
material terms of an Option are determinable, or (2) if the Option is awarded
pursuant to a formula under a then existing program established by the
Committee, as of a date no earlier than the later of sixty (60) days prior to
the date all of the material terms of the Option are determinable or sixty (60)
days following the date the program is established.
(iii) Notwithstanding any other provision of this
Section 3.2(a), the Committee may continue to maintain the existing Management
Stock Option Program as in effect on September 30, 1999 or in any modified form;
provided, however, that no such modified form shall contain pricing terms more
favorable than those as in effect under the Management Stock Option Program on
September 30, 1999.
(iv) Notwithstanding any other provision in the
Plan, following the grant of an Option, no amendment shall be made to reduce the
price of the Option, except an adjustment as described in Section 5.2, without
the prior approval of the stockholders of the Company.
(a) Option Term. The term of an Option shall be as specified
in the applicable Stock Incentive Agreement; provided, however that any
Incentive Stock Option granted to a Participant who is not an Over 10% Owner
shall not be exercisable after the expiration of ten (10) years after the date
the Option is granted and any Incentive Stock Option granted to an Over 10%
Owner shall not be exercisable after the expiration of five (5) years after the
date the Option is granted.
(b)......Payment. Payment for all shares of Stock purchased
pursuant to exercise of an Option shall be made in any form or manner authorized
by the Committee in the Stock Incentive Agreement or by amendment thereto,
including, but not limited to, cash or, if the Stock Incentive Agreement
provides, (i) by delivery to the Company of a number of shares of Stock which
have been owned by the holder for at least six (6) months prior to the date of
exercise having an aggregate Fair Market Value of not less than the product of
the Exercise Price multiplied by the number of shares the Participant intends to
purchase upon exercise of the Option on the date of delivery; (ii) in a cashless
exercise through a broker; or (iii) by having a number of shares of Stock
withheld, the Fair Market Value of which as of the date of exercise is
sufficient to satisfy the Exercise Price. In its discretion, the Committee also
may authorize (at the time an Option is granted or thereafter) Company financing
to assist the Participant as to payment of the Exercise Price on such terms as
may be offered by the Committee in its discretion. Payment shall be made at the
time that the Option or any part thereof is exercised, and no shares shall be
issued or delivered upon exercise of an option until full payment has been made
by the Participant. The holder of an Option, as such, shall have none of the
rights of a stockholder.
(c)......Conditions to the Exercise of an Option. Each Option
granted under the Plan shall be exercisable by whom, at such time or times, or
upon the occurrence of such event or events, and in such amounts, as the
Committee shall specify in the Stock Incentive Agreement; provided, however,
that subsequent to the grant of an Option, the Committee, at any time before
complete termination of such Option, may accelerate the time or times at which
such Option may be exercised in whole or in part, including, without limitation,
upon a Change in Control and may permit the Participant or any other designated
person to exercise the Option, or any portion thereof, for all or part of the
remaining Option term notwithstanding any provision of the Stock Incentive
Agreement to the contrary.
(d)......Termination of Incentive Stock Option. With respect
to an Incentive Stock Option, in the event of the Termination of Service of a
Participant, the Option or portion thereof held by the Participant which is
unexercised shall expire, terminate, and become unexercisable no later than the
expiration of three (3) months after the date of Termination of Service;
provided, however, that in the case of a holder whose Termination of Service is
due to death or Disability, one (1) year shall be substituted for such three (3)
month period. For purposes of this Subsection (e), Termination of Service of the
Participant shall not be deemed to have occurred if the Participant is employed
by another corporation (or a parent or subsidiary corporation of such other
corporation) which has assumed the Incentive Stock Option of the Participant in
a transaction to which Code Section 424(a) is applicable.
(e)......Special Provisions for Certain Substitute Options.
Notwithstanding anything to the contrary in this Section 3.2, any Option issued
in substitution for an option previously issued by another entity, which
substitution occurs in connection with a transaction to which Code Section
424(a) is applicable, may provide for an exercise price computed in accordance
with such Code Section and the regulations thereunder and may contain such other
terms and conditions as the Committee may prescribe to cause such substitute
Option to contain as nearly as possible the same terms and conditions (including
the applicable vesting and termination provisions) as those contained in the
previously issued option being replaced thereby.
3.3......Terms and Conditions of Stock Appreciation Rights. Each Stock
Appreciation Right granted under the Plan shall be evidenced by a Stock
Incentive Agreement. A Stock Appreciation Right may be granted in connection
with all or any portion of a previously or contemporaneously granted Stock
Incentive or not in connection with a Stock Incentive. A Stock Appreciation
Right shall entitle the Participant to receive the excess of (a) the Fair Market
Value of a specified or determinable number of shares of the Stock at the time
of payment or exercise over (b) a specified price (i) which, in the case of a
Stock Appreciation Right granted in connection with an Option, shall be not less
than the Exercise Price for that number of shares and (ii) which, in the case of
a Stock Appreciation Right that is granted to a Participant who is then a
Covered Employee, shall not be less than the Fair Market Value of the Stock at
the time of the award. A Stock Appreciation Right granted in connection with a
Stock Incentive may only be exercised to the extent that the related Stock
Incentive has not been exercised, paid or otherwise settled. The exercise of a
Stock Appreciation Right granted in connection with a Stock Incentive shall
result in a pro rata surrender or cancellation of any related Stock Incentive to
the extent the Stock Appreciation Right has been exercised.
(a)......Settlement. Upon settlement of a Stock Appreciation
Right, the Company shall pay to the Participant the appreciation in cash or
shares of Stock (valued at the aggregate Fair Market Value on the date of
payment or exercise) as provided in the Stock Incentive Agreement or, in the
absence of such provision, as the Committee may determine.
(b)......Conditions to Exercise. Each Stock Appreciation Right
granted under the Plan shall be exercisable or payable at such time or times, or
upon the occurrence of such event or events, and in such amounts, as the
Committee shall specify in the Stock Incentive Agreement; provided, however,
that subsequent to the grant of a Stock Appreciation Right, the Committee, at
any time before complete termination of such Stock Appreciation Right, may
accelerate the time or times at which such Stock Appreciation Right may be
exercised or paid in whole or in part.
3.4 Terms and Conditions of Stock Awards.
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(a) .....The number of shares of Stock subject to a Stock
Award and restrictions or conditions on such shares, if any, shall be as the
Committee determines, and the certificate for such shares shall bear evidence of
any restrictions or conditions. Subsequent to the date of the grant of the Stock
Award, the Committee shall have the power to permit, in its discretion, an
acceleration of the expiration of an applicable restriction period with respect
to any part or all of the shares awarded to a Participant. Subject to
Subsections (b) and (c) below, the Committee may require a cash payment from the
Participant in an amount no greater than the aggregate Fair Market Value of the
shares of Stock awarded determined at the date of grant in exchange for the
grant of a Stock Award or may grant a Stock Award without the requirement of a
cash payment.
(b)......Any Stock Award containing forfeitability provisions
shall vest over a period of no less than three (3) years.
.........(c)......Any Stock Award that does not contain forfeitability
provisions shall be granted only in lieu of salary or cash bonus otherwise
payable to a Participant and may be granted at up to a fifteen percent (15%)
discount to the Fair Market Value of the Stock as of the date of grant only if
the Stock is subject to material restrictions on transferability.
3.4 Terms and Conditions of Dividend Equivalent Rights. A Dividend
Equivalent Right shall entitle the Participant to receive payments from the
Company in an amount determined by reference to any cash dividends paid on a
specified number of shares of Stock to Company stockholders of record during the
period such rights are effective. The Committee may impose such restrictions and
conditions on any Dividend Equivalent Right as the Committee in its discretion
shall determine, including the date any such right shall terminate and may
reserve the right to terminate, amend or suspend any such right at any time.
(a)......Payment. Payment in respect of a Dividend Equivalent
Right may be made by the Company in cash or shares of Stock (valued at Fair
Market Value on the date of payment) as provided in the Stock Incentive
Agreement or, in the absence of such provision, as the Committee may determine.
(b)......Conditions to Payment. Each Dividend Equivalent Right
granted under the Plan shall be payable at such time or times, or upon the
occurrence of such event or events, and in such amounts, as the Committee shall
specify in the Stock Incentive Agreement or Stock Incentive Program; provided,
however, that subsequent to the grant of a Dividend Equivalent Right, the
Committee, at any time before complete termination of such Dividend Equivalent
Right, may accelerate the time or times at which such Dividend Equivalent Right
may be paid in whole or in part.
3.5......Terms and Conditions of Performance Unit Awards. A Performance
Unit Award shall entitle the Participant to receive, at a future date, payment
of an amount equal to all or a portion of the value of a number of units (stated
in terms of a designated dollar amount per unit) granted by the Committee, all
as the Committee shall specify in the Stock Incentive Agreement or Stock
Incentive Program. At the time of the grant, the Committee must determine the
base value of each unit, the number of units subject to a Performance Unit
Award, the performance factors applicable to the determination of the ultimate
payment value of the Performance Unit Award and the period over which Company
performance shall be measured. The Committee may provide for an alternate base
value for each unit under certain specified conditions.
(a)......Payment. Payment in respect of Performance Unit
Awards may be made by the Company in cash or shares of Stock (valued at Fair
Market Value on the date of payment) as provided in the Stock Incentive
Agreement or Stock Incentive Program or, in the absence of such provision, as
the Committee may determine.
(b)......Conditions to Payment. Each Performance Unit Award
granted under the Plan shall be payable at such time or times, or upon the
occurrence of such event or events, and in such amounts, as the Committee shall
specify in the Stock Incentive Agreement or Stock Incentive Program; provided,
however, that subsequent to the grant of a Performance Unit Award, the
Committee, at any time before complete termination of such Performance Unit
Award, may accelerate the time or times at which such Performance Unit Award may
be paid in whole or in part.
3.6......Terms and Conditions of Phantom Shares. Phantom Shares shall
entitle the Participant to receive, at a future date, payment of an amount equal
to all or a portion of the Fair Market Value of a number of shares of Stock at
the end of a certain period, all as the Committee shall specify in the Stock
Incentive Agreement or Stock Incentive Program. At the time of the grant, the
Committee shall determine the factors which will govern the portion of the
rights so payable, including, at the discretion of the Committee, any
performance criteria that must be satisfied as a condition to payment.
(a)......Payment. Payment in respect of Phantom Shares may be
made by the Company in cash or shares of Stock (valued at Fair Market Value on
the date of payment) as provided in the Stock Incentive Agreement or Stock
Incentive Program or, in the absence of such provision, as the Committee may
determine.
(b)......Conditions to Payment. Each Phantom Share granted
under the Plan shall be payable at such time or times, or upon the occurrence of
such event or events, and in such amounts, as the Committee shall specify in the
Stock Incentive Agreement or Stock Incentive Program; provided, however, that
subsequent to the grant of a Phantom Share, the Committee, at any time before
complete termination of such Phantom Share, may accelerate the time or times at
which such Phantom Share may be paid in whole or in part.
3.7......Treatment of Awards Upon Termination of Service.
Except as otherwise provided by Plan Section 3.2(e), any award under this Plan
to a Participant who suffers a Termination of Service may be cancelled,
accelerated, paid or continued, as provided in the Stock Incentive Agreement or
Stock Incentive Program or, in the absence of such provision, as the Committee
may determine; provided that, a Participant who continues in the service of
Morrison Fresh Cooking, Inc. or Morrison Health Care, Inc. immediately following
a spin-off of either such Subsidiary shall not be deemed to have incurred a
Termination of Service solely by reason of the spin-off. The portion of any
award exercisable in the event of continuation or the amount of any payment due
under a continued award may be adjusted by the Committee to reflect the
Participant's period of service from the date of grant through the date of the
Participant's Termination of Service or such other factors as the Committee
determines are relevant to its decision to continue the award.
SECTION 4 RESTRICTIONS ON STOCK
4.1......Escrow of Shares. Any certificates representing the shares of
Stock issued under the Plan shall be issued in the Participant's name, but, if
the Stock Incentive Agreement or Stock Incentive Program so provides, the shares
of Stock shall be held by a custodian designated by the Committee (the
"Custodian"). Each applicable Stock Incentive Agreement or Stock Incentive
Program providing for transfer of shares of Stock to the Custodian shall appoint
the Custodian as the attorney-in-fact for the Participant for the term specified
in the applicable Stock Incentive Agreement or Stock Incentive Program, with
full power and authority in the Participant's name, place and stead to transfer,
assign and convey to the Company any shares of Stock held by the Custodian for
such Participant, if the Participant forfeits the shares under the terms of the
applicable Stock Incentive Agreement or Stock Incentive Program. During the
period that the Custodian holds the shares subject to this Section, the
Participant shall be entitled to all rights, except as provided in the
applicable Stock Incentive Agreement or Stock Incentive Program, applicable to
shares of Stock not so held. Any dividends declared on shares of Stock held by
the Custodian shall, as the Committee may provide in the applicable Stock
Incentive Agreement or Stock Incentive Program, be paid directly to the
Participant or, in the alternative, be retained by the Custodian until the
expiration of the term specified in the applicable Stock Incentive Agreement or
Stock Incentive Program and shall then be delivered, together with any proceeds,
with the shares of Stock to the Participant or to the Company, as applicable.
4.2......Forfeiture of Shares. Notwithstanding any vesting schedule set
forth in any Stock Incentive Agreement or Stock Incentive Program, in the event
that the Participant violates a noncompetition agreement as set forth in the
Stock Incentive Agreement or Stock Incentive Program, all Stock Incentives and
shares of Stock issued to the holder pursuant to the Plan shall be forfeited;
provided, however, that the Company shall return to the holder the lesser of any
consideration paid by the Participant in exchange for Stock issued to the
Participant pursuant to the Plan or the then Fair Market Value of the Stock
forfeited hereunder.
4.3......Restrictions on Transfer. The Participant shall not have the
right to make or permit to exist any Disposition of the shares of Stock issued
pursuant to the Plan except as provided in the Plan or the applicable Stock
Incentive Agreement or Stock Incentive Program. Any Disposition of the shares of
Stock issued under the Plan by the Participant not made in accordance with the
Plan or the applicable Stock Incentive Agreement or Stock Incentive Program
shall be void. The Company shall not recognize, or have the duty to recognize,
any Disposition not made in accordance with the Plan and the applicable Stock
Incentive Agreement or Stock Incentive Program, and the shares so transferred
shall continue to be bound by the Plan and the applicable Stock Incentive
Agreement or Stock Incentive Program.
SECTION 5 GENERAL PROVISIONS
5.1......Withholding. The Company shall deduct from all cash
distributions under the Plan any taxes required to be withheld by federal, state
or local government. Whenever the Company proposes or is required to issue or
transfer shares of Stock under the Plan or upon the vesting of any Stock Award,
the Company shall have the right to require the recipient to remit to the
Company an amount sufficient to satisfy any federal, state and local withholding
tax requirements prior to the delivery of any certificate or certificates for
such shares or the vesting of such Stock Award. A Participant may pay the
withholding tax in cash, or, if the applicable Stock Incentive Agreement or
Stock Incentive Program provides, a Participant may elect to have the number of
shares of Stock he is to receive reduced by, or with respect to a Stock Award,
tender back to the Company, the smallest number of whole shares of Stock which,
when multiplied by the Fair Market Value of the shares of Stock determined as of
the Tax Date (defined below), is sufficient to satisfy federal, state and local,
if any, withholding taxes arising from exercise or payment of a Stock Incentive
(a "Withholding Election"). A Participant may make a Withholding Election only
if both of the following conditions are met:
(a)......The Withholding Election must be made on or prior to
the date on which the amount of tax required to be withheld is determined (the
"Tax Date") by executing and delivering to the Company a properly completed
notice of Withholding Election as prescribed by the Committee; and
(b)......Any Withholding Election made will be irrevocable;
however, the Committee may in its sole discretion disapprove and give no effect
to the Withholding Election.
5.2......Changes in Capitalization; Merger; Liquidation.
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(a)......The number of shares of Stock reserved for the grant
of Options, Dividend Equivalent Rights, Performance Unit Awards, Phantom Shares,
Stock Appreciation Rights and Stock Awards; the number of shares of Stock
reserved for issuance upon the exercise or payment, as applicable, of each
outstanding Option, Dividend Equivalent Right, Performance Unit Award, Phantom
Share and Stock Appreciation Right and upon vesting or grant, as applicable, of
each Stock Award; the Exercise Price of each outstanding Option and the
specified number of shares of Stock to which each outstanding Dividend
Equivalent Right, Phantom Share and Stock Appreciation Right pertains shall be
proportionately adjusted for any increase or decrease in the number of issued
shares of Stock resulting from a subdivision or combination of shares or the
payment of an ordinary stock dividend in shares of Stock to holders of
outstanding shares of Stock or any other increase or decrease in the number of
shares of Stock outstanding effected without receipt of consideration by the
Company.
(b)......In the event of any merger, consolidation,
extraordinary dividend (including a spin-off), reorganization or other change in
the corporate structure of the Company or its Stock or tender offer for shares
of Stock, the Committee, in its sole discretion, may make such adjustments with
respect to awards and take such other action as it deems necessary or
appropriate to reflect or in anticipation of such merger, consolidation,
extraordinary dividend, reorganization, other change in corporate structure or
tender offer, including, without limitation, the substitution of new awards, the
termination or adjustment of outstanding awards, the acceleration of awards or
the removal of restrictions on outstanding awards. Any adjustment pursuant to
this Section 5.2 may provide, in the Committee's discretion, for the elimination
without payment therefor of any fractional shares that might otherwise become
subject to any Stock Incentive.
(c)......The existence of the Plan and the Stock Incentives
granted pursuant to the Plan shall not affect in any way the right or power of
the Company to make or authorize any adjustment, reclassification,
reorganization or other change in its capital or business structure, any merger
or consolidation of the Company, any issue of debt or equity securities having
preferences or priorities as to the Stock or the rights thereof, the dissolution
or liquidation of the Company, any sale or transfer of all or any part of its
business or assets, or any other corporate act or proceeding.
5.3......Cash Awards. The Committee may, at any time and in its
discretion, grant to any holder of a Stock Incentive the right to receive, at
such times and in such amounts as determined by the Committee in its discretion,
a cash amount which is intended to reimburse such person for all or a portion of
the federal, state and local income taxes imposed upon such person as a
consequence of the receipt of the Stock Incentive or the exercise of rights
thereunder.
5.4......Compliance with Code. All Incentive Stock Options to be
granted hereunder are intended to comply with Code Section 422, and all
provisions of the Plan and all Incentive Stock Options granted hereunder shall
be construed in such manner as to effectuate that intent.
5.5......Right to Terminate Service. Nothing in the Plan or in any
Stock Incentive Agreement or Stock Incentive Program shall confer upon any
Participant the right to continue as an employee, officer or director of the
Company or any of its affiliates or affect the right of the Company or any of
its affiliates to terminate the Participant's service at any time.
5.6......Restrictions on Delivery and Sale of Shares; Legends. Each
Stock Incentive is subject to the condition that if at any time the Committee,
in its discretion, shall determine that the listing, registration or
qualification of the shares covered by such Stock Incentive upon any securities
exchange or under any state or federal law is necessary or desirable as a
condition of or in connection with the granting of such Stock Incentive or the
purchase or delivery of shares thereunder, the delivery of any or all shares
pursuant to such Stock Incentive may be withheld unless and until such listing,
registration or qualification shall have been effected. If a registration
statement is not in effect under the Securities Act of 1933 or any applicable
state securities laws with respect to the shares of Stock purchasable or
otherwise deliverable under Stock Incentives then outstanding, the Committee may
require, as a condition of exercise of any Option or as a condition to any other
delivery of Stock pursuant to a Stock Incentive, that the Participant or other
recipient of a Stock Incentive represent, in writing, that the shares received
pursuant to the Stock Incentive are being acquired for investment and not with a
view to distribution and agree that the shares will not be disposed of except
pursuant to an effective registration statement, unless the Company shall have
received an opinion of counsel that such disposition is exempt from such
requirement under the Securities Act of 1933 and any applicable state securities
laws. The Company may include on certificates representing shares delivered
pursuant to a Stock Incentive such legends referring to the foregoing
representations or restrictions or any other applicable restrictions on resale
as the Company, in its discretion, shall deem appropriate.
5.7......Non-alienation of Benefits. Other than as specifically
provided with regard to the death of a Participant, no benefit under the Plan
shall be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance or charge; and any attempt to do so shall be
void. No such benefit shall, prior to receipt by the Participant, be in any
manner liable for or subject to the debts, contracts, liabilities, engagements
or torts of the Participant.
5.8......Termination and Amendment of the Plan. The Board of Directors
may, at any time, amend or terminate the Plan without stockholder approval;
provided, however that the Board of Directors shall condition any material
amendment on the approval of the stockholders of the Company. No such
termination or amendment without the consent of the holder of a Stock Incentive
shall adversely affect the rights of the Participant under such Stock Incentive.
5.9......Stockholder Approval. The Plan, as amended and restated, shall
be submitted to the stockholders of the Company for their approval within twelve
(12) months before or after its adoption by the Board of Directors. If such
approval is not obtained, any Stock Incentive granted under the Plan as amended
and restated shall be void.
5.10.....Choice of Law. The laws of the State of Georgia shall govern
the Plan, to the extent not preempted by federal law.
5.11.....Effective Date of Plan. The Plan, as amended and restated,
shall become effective upon the date the Plan is approved by the stockholders of
the Company.
RUBY TUESDAY, INC.
By:__________________________________________________
Title:_______________________________________________
Attest:
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Secretary
[CORPORATE SEAL]
