<PAGE>
EXHIBIT 10.6
STOCK OPTION AGREEMENT
----------------------
THIS STOCK OPTION AGREEMENT is made effective as of the 6th day of
September, 2000 between CHICO'S FAS, INC., a Florida corporation ("Chico's") and
TEDFORD MARLOW (the "Optionee").
W I T N E S S E T H
- - - - - - - - - -
WHEREAS, the Optionee is presently engaged by Chico's as its Executive Vice
President and pursuant to the terms of that certain Employment Agreement between
the parties hereto dated August 29, 2000; Chico's has agreed to grant to the
Optionee the option herein provided for, to the end that the Optionee may
thereby be assisted in obtaining an interest in the stock ownership of Chico's.
NOW, THEREFORE, in consideration of the covenants and agreements herein
contained, the parties hereto hereby agree as follows:
1. Grant. Chico's hereby grants to the Optionee an option (the "Option")
-----
to purchase 30,000 shares of Chico's common stock, par value $.01 per share
("Common Stock") at an exercise price of $22.96 per share, both as adjusted
pursuant to Section 10 hereof.
2. Exercise. The Option may be exercised at any time during the period
--------
hereinafter permitted by presentation at the principal offices of Chico's in Ft.
Myers, Florida of (a) written notice to Chico's advising Chico's of the election
of the Optionee to purchase the shares of Common Stock covered by this Option
and (b) payment of the aggregate option price therefor.
3. Period of Exercise. The Option is exercisable in whole or from time
------------------
to time in part during the period from September 6, 2001 through September 5,
2010, except as provided in Section 8 hereof.
4. Vesting Schedule. The Optionee's rights under the Option shall vest
----------------
(on a cumulative basis) over the Exercise Period in accordance with the
following schedule:
<PAGE>
------------------------------------------------------------
Number of Years From the Exercisable Percentage of
Date the Option is Granted Number of Shares Originally
Covered by the Option
------------------------------------------------------------
Less than 1 year 0%
------------------------------------------------------------
1 year but less than 2 years 33.33%
------------------------------------------------------------
2 years but less than 3 years 66.66%
------------------------------------------------------------
3 years or more 100%
------------------------------------------------------------
5. Requirements of Law. Chico's shall not be required to sell or issue
-------------------
any shares under the Option if the issuance of such shares shall constitute a
violation of any provisions of any law or regulation of any governmental
authority. Specifically, in connection with the Securities Act of 1933 (the
"Act"), upon exercise of the Option, unless a registration statement under the
Act is in effect with respect to the shares of Common Stock covered by the
Option, Chico's shall not be required to issue such shares unless Chico's has
received evidence reasonably satisfactory to the effect that the Optionee is
acquiring such shares for investment and not with a view to the distribution
thereof, and unless the certificate issued representing the shares of Common
Stock bears the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AS AMENDED, OR THE
SECURITIES LAWS OF ANY STATE AND MAY NOT BE OFFERED FOR SALE,
SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT OR EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT OF 1933 AS AMENDED AND APPLICABLE STATE SECURITIES
LAWS."
Any reasonable determination in this connection by Chico's shall be final,
binding and conclusive.
At such time as a registration statement under the Act is in effect with
respect to the shares of Common Stock represented by certificates bearing the
above legend or at such time as, in the opinion of counsel for Chico's, such
legend is no longer required solely for compliance with applicable securities
laws, then the holders of such certificates shall be entitled to exchange such
certificates for certificates representing a like number of shares but without
such legend. Chico's may, but shall in no event be obligated to, register any
securities covered hereby pursuant to the Act. Chico's shall not be obligated
to take any other affirmative action in order to cause the exercise of the
Option or the issuance of shares pursuant thereto to comply with any law or
regulation of any governmental authority.
2.
<PAGE>
6. Method of Payment. Payment shall be made:
-----------------
(a) in United States dollars by certified check, or bank draft or
(b) by tendering to Chico's Common Stock shares owned by the person
exercising the Option and having a fair market value equal to the cash
exercise price applicable to such Option, such fair market value to be the
closing price, on the date in question (or, if no shares are traded on such
day, on the next preceding day on which shares were traded), of the Common
Stock as reported on the Composite Tape, or if not reported thereon, then
such price as reported in the trading reports of the principal securities
exchange in the United States on which such stock is listed, or if such
stock is not listed on a securities exchange in the United States, the mean
between the dealer closing "bid" and "ask" prices on the over-the-counter
market as reported by the National Association of Security Dealers
Automated Quotation System (NASDAQ), or NASDAQ's successor, or if not
reported on NASDAQ, the fair market value of such stock as determined by
the Board in good faith and based on all relevant factors, or
(c) by a combination of United States dollars and Common Stock shares
as aforesaid.
To the extent permitted by applicable law and regulations, Chico's may from
time to time, in its discretion, approve an arrangement with a brokerage firm
under which such brokerage firm, on behalf of the Optionee, would pay to Chico's
the full purchase price of the shares being purchased together with an amount
equal to any taxes which Chico's is required to withhold in connection with the
exercise of the option and Chico's, pursuant to an irrevocable notice from such
the Optionee, would deliver the shares being purchased to such brokerage firm.
7. Transferability of Option. The Option shall not be transferable by
-------------------------
the Optionee otherwise than by will or the laws of descent and distribution, and
shall be exercisable during his lifetime only by him.
8. Death or Other Termination of Employment.
----------------------------------------
(a) In the event that the Optionee (1) shall cease to be employed by
Chico's because of his discharge for dishonesty, or because he violated any
material provision of any employment or other agreement between him and Chico's,
or (2) shall voluntarily resign or terminate his employment with Chico's under
or followed by such circumstances as would constitute a breach of any material
provision of any employment or other agreement between him and Chico's, or (3)
shall have committed an act of dishonesty not discovered by Chico's prior to the
cessation of his employment but that would have resulted in his discharge if
discovered prior to such date, or (4) shall, either before or after cessation of
his employment with Chico's, without the written consent of his employer or
former employer, use (except for the benefit of his employer or former employer)
or disclose to any other person any confidential information relating to the
continuation or proposed continuation of his employer's or former employer's
business or any trade secrets of Chico's obtained as a result of
3.
<PAGE>
or in connection with such employment, or (5) shall, either before or after the
cessation of his employment with Chico's, without the written consent of his
employer or former employer, directly or indirectly, give advice to, or serve as
an employee, director, officer, partner or trustee of, or in any similar
capacity with, or otherwise directly or indirectly participate in the
management, operation or control of, or have any direct or indirect financial
interest in, any corporation, partnership or other organization that directly or
indirectly competes in any respect with Chico's, then forthwith from the
happening of any such event, the Option granted hereunder shall terminate and
become void to the extent that it then remains unexercised.
(b) In the event that the Optionee shall cease to be employed by
Chico's for any reason other than his death or one or more of the reasons set
forth in Section 8(a), subject to the condition that the Option shall not be
exercisable after the expiration of ten (10) years from the date it is granted,
the Optionee shall have the right to exercise the Option at any time within
three (3) months after such termination of employment to the extent his right to
exercise the Option had accrued and vested hereunder at the date of such
termination and had not previously been exercised; such three-month limit shall
be increased to one (1) year if the Optionee ceases to be employed by Chico's
because he becomes disabled (within the meaning of Section 22(e)(3) of the
Internal Revenue Code of 1986, as amended) or if he dies during the three-month
period and the Option may be exercised within such extended time limit by the
Optionee or, in the case of death, the personal representative of the Optionee
or by any person or persons who shall have acquired the Option directly from the
Optionee by bequest or inheritance. Whether an authorized leave of absence or
absence for military or governmental service shall constitute termination of
employment for purposes of this Agreement shall be determined by the
Compensation and Benefits Committee of the Board of Directors of Chico's, whose
determination shall be final and conclusive.
(c) In the event that an Optionee shall die while in the employ of
Chico's and shall not have fully exercised this Option, the Option may be
exercised, subject to the condition that this Option shall not be exercisable
after the expiration of ten (10) years from the date it is granted, to the
extent that the Optionee's right to exercise this Option had accrued and vested
hereunder at the time of his death and had not previously been exercised, at any
time within one (1) year after the Optionee's death, by the personal
representative of the Optionee or by any person or persons who shall have
acquired the Option directly from the Optionee by bequest or inheritance.
(d) If there shall occur a Change in Control (as hereinafter defined)
of Chico's while any shares of Common Stock remain subject to this Option, then
the Option shall become immediately exercisable and fully vested without regard
to Section 4 hereof and such exercisability shall terminate only pursuant to
Section 3 hereof without regard to the other provisions of this Section 8.
(e) For purposes of this Agreement, a "Change in Control" shall mean:
(1) the obtaining by any party of fifty percent (50%) or
more of the voting shares of Chico's pursuant to a "tender offer" for such
shares as provided under Rule 14d-2 promulgated under the Securities
Exchange Act of 1934, as amended, or any subsequent comparable federal rule
or regulation governing tender offers; or
4.
<PAGE>
(2) individuals who were members of Chico's Board of
Directors immediately prior to any particular meeting of Chico's
shareholders which involves a contest for the election of directors fail to
constitute a majority of the members of Chico's Board of Directors
following such election; or
(3) Chico's executing an agreement concerning the sale of
substantially all of its assets to a purchaser which is not a subsidiary;
or
(4) Chico's adoption of a plan of dissolution or
liquidation; or
(5) Chico's executing an agreement concerning a merger or
consolidation involving Chico's in which Chico's is not the surviving
corporation or if, immediately following such merger or consolidation, less
than fifty percent (50%) of the surviving corporation's outstanding voting
stock is held by persons who are stockholders of Chico's immediately prior
to such merger or consolidation.
9. No Rights as Stockholder. The Optionee shall have no rights as a
------------------------
stockholder with respect to shares covered by the Option until the date of
issuance of a stock certificate for such shares; no adjustment for dividends, or
otherwise, except as provided in Section 10, shall be made if the record date
therefor is prior to the date of exercise of such option.
10. Stock Adjustments.
-----------------
(a) In the event of any increase or decrease in the number of issued
shares of Common Stock resulting from a stock split or other division or
consolidation of shares or the payment of a stock dividend (but only on the
Common Stock) or any other increase or decrease in the number of such
shares effected without any receipt of consideration by Chico's, then, in
any such event, the number of shares of Common Stock covered by the Option,
and the purchase price per share of Common Stock covered by the Option
shall be proportionately and appropriately adjusted for any such increase
or decrease.
(b) Subject to any required action by the stockholders, if any change
occurs in the shares of Common Stock by reason of any recapitalization,
reorganization, merger, consolidation, split-up, combination or exchange of
shares, or of any similar change affecting the shares of Common Stock,
then, in any such event, the number and type of shares covered by the
Option, and the purchase price per share of Common Stock covered by the
Option, shall be proportionately and appropriately adjusted for any such
change. A dissolution or liquidation of Chico's shall cause each
outstanding Option to terminate.
(c) In the event of a change in the Common Stock as presently
constituted that is limited to a change of all of its authorized shares
with par value into the same number of
5.
<PAGE>
shares with a different par value or without par value, the shares
resulting from any change shall be deemed to be shares of Common Stock
within the meaning of this Agreement.
(d) To the extent that the foregoing adjustments relate to stock or
securities of Chico's, such adjustments shall be made by, and in the
discretion of, the Board, whose determination in that respect shall be
final, binding and conclusive.
(e) Except as hereinabove expressly provided in this Section 10, the
Optionee shall have no rights by reason of any division or consolidation of
shares of stock of any class or the payment of any stock dividend or any
other increase or decrease in the number of shares of stock of any class or
by reason of any dissolution, liquidation, merger or consolidation, or
spin-off of assets or stock of another corporation; and any issuance by
Chico's of shares of stock of any class, securities convertible into shares
of stock of any class, or warrants or options for shares of stock of any
class shall not affect, and no adjustment by reason thereof shall be made
with respect to, the number or price of shares of Common Stock subject to
the Option.
(f) The grant of this Option shall not affect in any way the right or
power of Chico's to make adjustments, reclassifications, reorganizations or
changes of its capital or business structure or to merge or to consolidate,
or to dissolve, to liquidate, to sell, or to transfer all or any part of
its business or assets.
11. Withholding. It shall be a condition to the obligation of Chico's to
-----------
issue Common Stock shares upon exercise of an Option, that the Optionee (or any
beneficiary or person entitled to act under Section 8 above) pay to Chico's,
upon its demand, such amount as may be requested by Chico's for the purpose of
satisfying any liability to withhold federal, state, local or foreign income or
other taxes. If the amount requested is not paid, Chico's may refuse to issue
Common Stock shares.
12. Governing Law. This Agreement shall be governed by the laws of the
-------------
State of Florida.
13. Entire Agreement. This Agreement contains the entire agreement of
-----------------
Chico's and the Optionee with respect to the subject matter hereof, and
supersedes all prior agreements or understandings, written, oral or otherwise,
with respect to the subject matter hereof.
14. Headings. The headings contained in this Agreement are for reference
---------
purposes only and shall not affect the meaning or interpretation of this
Agreement.
15. Waiver. Failure by Chico's at any time to require performance of any
-------
provision of this Agreement shall not affect its right to require full
performance thereof at any time thereafter. No waiver or delay in enforcing the
terms of this Agreement by Chico's shall be construed as a waiver of any
subsequent breach or default of the same or similar nature or of any other
nature.
6.
<PAGE>
16. Binding Effect. This Agreement shall be binding upon the parties,
--------------
their heirs, legal representatives, successors, assigns, and transferees.
17. Gender; Word Use. Throughout this Agreement, except where the context
----------------
otherwise requires, the masculine gender shall be deemed to include the
feminine, and the singular shall be deemed to include the plural, and vice
versa.
18. Counterparts. This Agreement may be executed in one or more
------------
counterparts, all of which shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
ATTEST: CHICO'S FAS, INC.
/s/ Charles J. Kleman By: /s/ Marvin J. Gralnick
------------------------------- -------------------------------------
Secretary Name: Marvin J. Gralnick
Title: Chief Executive Officer, President,
and Chairman
/s/ Gary I. Teblum /s/ Tedford Marlow
------------------------------- -----------------------------------------
Tedford Marlow
/s/ Scott Edmonds
-------------------------------
7.
