Exhibit 10.10

 

STOCK OPTION AWARD AGREEMENT

FRIENDLY ICE CREAM CORPORATION

2003 INCENTIVE PLAN

 

THIS AGREEMENT, dated as of the [       ]  day of [               ] 2005 (the
“Grant Date”) and entered into by and between Friendly Ice Cream Corporation
(the “Company”) and [   Name   ] (the “Participant”).

 

WITNESSETH THAT:

 

WHEREAS, the Company maintains the Friendly Ice Cream Corporation 2003 Incentive
Plan (the “Plan”), which is incorporated into and forms a part of this
Agreement, for the benefit of employees of the Company and certain other Related
Companies; and

 

WHEREAS, the Board has awarded the Participant an Option Award under the Plan;

 

NOW, THEREFORE, IT IS AGREED, by and between the Company and the Participant as
follows:

 

1.             Award and Purchase Price. Subject to the terms of this Agreement
and the Plan, the Participant is hereby granted an option (the “Option”) to
purchase [        ] shares of Stock (the “Award”). The price of each share of
Stock subject to the Option shall be $[      ]. The Option is not intended to
constitute an “incentive stock option” as that term is used in Code section 422.

 

2.             Vesting. The shares of Stock awarded hereunder shall become
exercisable in accordance with the following schedule:

 

Vesting Date

 

# Options Available for Exercise

 

 

 

 

 

% of Award

 

 

% of Award

 

 

% of Award

 

Notwithstanding the foregoing provisions of this paragraph 2, this Option may
vest and become immediately exercisable if the Participant’s Date of Termination
occurs by reason of death or Disability as determined by the Board in its sole
discretion.

 

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3.             Expiration; Forfeiture. This Option shall expire on the earliest
to occur of:

 

(a)                                  the five-year anniversary of the Grant
Date;

 

(b)                                 if the Participant’s Date of Termination
occurs by reason of death or Disability, the one-year anniversary of such Date
of Termination;

 

(c)                                  if the Participant’s Date of Termination
occurs by reason of Retirement, the three-year anniversary of such Date of
Termination; or

 

(d)                                 if the Participant’s Date of Termination
occurs for reasons other than death, Disability or Retirement, the three-month
anniversary of such Date of Termination;

 

which shall be the “Expiration Date” for the Option (as that term is described
in subsection 2.6 of the Plan). Notwithstanding the foregoing provisions of this
paragraph 3, except as provided in paragraph 2 above, no portion of the Option
shall be exercisable after the Participant’s Date of Termination except to the
extent that it is exercisable as of the date immediately prior to the
Participant’s Date of Termination. Unvested Options shall be forfeited upon the
Participant no longer being classified as an Eligible Individual, however the
Board, in the sole discretion, may determine that forfeiture will not occur or
may make a grant to any participant who is no longer classified as an Eligible
Individual.

 

4.             Method of Option Exercise. Any portion of the Option that is
exercisable may be exercised in whole or in part by filing a written notice with
the Clerk of the Company at its corporate headquarters, provided that the notice
is filed prior to the Expiration Date of the Option. Such notice shall specify
the number of shares of Stock which the Participant elects to purchase, and
shall be accompanied by payment of the purchase price for such shares indicated
by the Participant’s election. Payment shall be by cash.

 

5.             Withholding. All Awards and payments under this Agreement are
subject to withholding of all applicable taxes. At the election of the
Participant, and with the consent of the Committee, such withholding obligations
may be satisfied through the surrender of Stock which the Participant already
owns or to which the Participant is otherwise entitled under the Plan; provided,
however, that previously-owned shares that have been held by the Participant
less than six months or Stock to which the Participant is entitled under the
Plan may only be used to satisfy the minimum tax withholding required by
applicable law.

 

6.             Transferability. This Option is not transferable except as
designated by the Participant by will or by the laws of descent and
distribution.

 

7.             Adjustment of Option. The number and type of shares awarded
pursuant to this Option, and the exercise price thereof, may be adjusted by the
Board in accordance with Section 4.4 of the Plan to reflect certain corporate
transactions, which affect the number, type or value of the Stock.

 

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8.             Change in Control. Upon the occurrence of a Change in Control,
this Option shall become immediately exercisable. A “Change in Control” shall be
deemed to occur on the earliest of the existence of one of the following events:

 

(a)                                  (i) any “person” (as such term is used in
Sections 13(d) or 14(d) of the Exchange Act), other than one or more Permitted
Holders (as defined below), is or becomes the beneficial owner (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more
than 35% of the total voting power of the Voting Stock (as defined below) of the
Company and (ii) the Permitted Holders “beneficially own” (as defined in Rules
13d-3 and 13d-5 under the Exchange Act), directly or indirectly, in the
aggregate a lesser percentage of the voting power of the Voting Stock of the
Company than such other person and do not have the right or ability by voting
power, contract or otherwise to elect or designate for election a majority of
the Board of Directors of the Company;

 

(b)                                 individuals who, as of the Plan’s effective
date, constitute the Board (as of the date hereof the “Incumbent Board”) cease
for any reason to constitute at least a majority of the Board, provided that any
individual becoming a director subsequent to the date hereof whose election, or
nomination for election by the Company’s shareholders, was approved by a vote of
at least a majority of the directors then comprising the Incumbent Board shall
be considered as though such individual were a member of the Incumbent Board,
but excluding, for this purpose, any such individual whose initial assumption of
office is in connection with an actual or threatened “election contest” relating
to the election of the directors of the Company (as such term is used in Rule
14a-11 of Regulation 14A promulgated under the Exchange Act); or

 

(c)                                  approval by the Company’s shareholders of a
reorganization, merger or consolidation of the Company, in each case, with
respect to which all or substantially all of the individuals and entities who
were the respective beneficial owners of the common stock and voting securities
of the Company immediately prior to such reorganization, merger or consolidation
do not, following such reorganization, merger or consolidation, beneficially
own, directly and indirectly, more than 70% of, respectively, the then
outstanding shares of common stock or the combined voting power of the then
outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the corporation resulting from such
reorganization, merger or consolidation, or of a complete liquidation or
dissolution of the Company or of the sale or other disposition of all or
substantially all of the assets of the Company.

 

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For purposes of this paragraph 8, the term “Permitted Holders” means Donald N.
Smith, the Company’s then existing executive officers and their respective
affiliates. The term “Voting Stock” of the Company means all classes of capital
stock of the Company then outstanding and normally entitled to vote in the
election of directors.

 

9.             Definitions. Except where the context clearly implies or
indicates the contrary, a word, term, or phrase used in the Plan is similarly
used in this Agreement.

 

10.           Administration. The authority to manage and control the operation
and administration of the Plan and this Agreement shall be vested in the Board
of Directors of the Company, and the Board shall have all the powers with
respect to this Agreement as it has with respect to the Plan. Any interpretation
of the Agreement by the Board and any decision made by it with respect to the
Agreement is final and binding on all persons. The Board, in its sole
discretion, may delegate any or all of its authority under the Plan or this
Agreement to a committee of the Board and, to the extent so delegated,
references to the Board hereunder shall be deemed to refer such committee.

 

11.           Plan Governs. The terms of this Agreement shall be subject to the
terms of the Plan, a copy of which may be obtained by the Participant from the
office of the Clerk of the Company.

 

12.           Amendment and Termination. The Board may at any time amend or
terminate the Plan, provided that no such amendment or termination may
materially adversely affect the rights of the Participant awarded hereunder.

 

IN WITNESS WHEREOF, the Participant has hereunto set his hand, and the Company
has caused these presents to be executed in its name and on its behalf, all as
of the Grant Date.

 

 

PARTICIPANT

 

 

 

 

 

 

[   Name        ]

 

 

 

 

 

FRIENDLY ICE CREAM CORPORATION

 

 

 

 

 

By

 

 

 

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