EXHIBIT 10.1
BOB EVANS FARMS, INC.
2006 EQUITY AND CASH INCENTIVE PLAN
INCENTIVE STOCK OPTION AWARD AGREEMENT
(For Employees — PIP Award)
     In recognition of your participation in the Bob Evans Farms, Inc.
Performance Incentive Plan, Bob Evans Farms, Inc. (“we” or “us”) has granted to
you an Incentive Stock Option (“Option”) to purchase shares of our common stock,
par value $0.01 per share (“Shares”), subject to the terms and conditions
described in the Bob Evans Farms, Inc. 2006 Equity and Cash Incentive Plan (the
“Plan”) and this Incentive Stock Option Award Agreement (this “Award
Agreement”). Your Option is intended to qualify as an “incentive stock option”
under Code §422. If for any reason your Option does not qualify as an incentive
stock option, then, to the extent it does not so qualify, your Option will be
regarded as a Nonqualified Stock Option.
     To ensure you fully understand the terms and conditions of your Option, you
should read the Plan and this Award Agreement carefully. Capitalized terms that
are not defined in this Award Agreement have the same meanings as in the Plan.
     You should return a signed copy of this Award Agreement to:
[Insert title]
Bob Evans Farms, Inc.
3776 S. High St.
Columbus, Ohio 43207

1.   Summary of Your Option       Grant Date: [insert Grant Date].       Number
of Shares Subject to Your Option: [insert number of shares] Shares.      
Exercise Price: $[insert Exercise Price] per Share.   2.   When Your Option Will
Vest

     (a) In General: You may not exercise your Option until it vests and becomes
exercisable. In general, your Option will vest and become exercisable with
respect to:

  •   [insert number of shares] Shares on the first anniversary of the Grant
Date;     •   [insert number of shares] Shares on the second anniversary of the
Grant Date; and     •   [insert number of shares] Shares on the third
anniversary of the Grant Date.

 

--------------------------------------------------------------------------------

 

     (b) Acceleration of Vesting: Notwithstanding Section 2(a):
     (i) If your employment Terminates due to your death, Disability or
Retirement, your Option will become fully vested and exercisable on your
Termination date; and
     (ii) Unless otherwise specified in a separate change in control agreement
(or written agreement of similar import) between you and us or any Related
Entity, your Option will become fully vested and exercisable if a Business
Combination or Change in Control occurs and:
     (A) We are not the surviving corporation following such Business
Combination or Change in Control; or
     (B) Within 24 months following such Business Combination or Change in
Control, the Plan is terminated and not replaced simultaneously with a similar
program providing comparable benefits; or
     (C) Within 24 months following such Business Combination or Change in
Control, your employment is Terminated by us and the Related Entities without
Cause or by you for Good Reason (as defined below).
     (c) Good Reason: Unless otherwise specified in an employment agreement or
change in control agreement between you and us or any Related Entity, “Good
Reason” means, without your written consent, (i) our or a Related Entity’s
failure to pay or cause to be paid your base salary or bonus (to the extent
earned in accordance with the terms of any applicable arrangement), if any, when
due, (ii) any substantial and sustained diminution in your authority or
responsibilities with us or any Related Entity or (iii) we or a Related Entity
require you to relocate more than 50 miles from your principal place of
employment on the Grant Date; provided that the events described in clauses (i),
(ii) and (iii) will constitute Good Reason only if we fail to cure such event
within 30 days after we receive from you written notice of the event which
constitutes Good Reason. “Good Reason” will cease to exist for an event on the
60th day following the later of its occurrence or your knowledge thereof, unless
you have given us written notice thereof prior to such date.
3. When You May Exercise Your Option and When It Will Expire
     (a) In General: In general, you may exercise all or any part of the vested
portion of your Option at any time prior to the tenth anniversary of the Grant
Date (the “Expiration Date”).
     (b) Effect of Termination: Notwithstanding the foregoing, if your
employment Terminates prior to the Expiration Date, your Option will remain
exercisable for the period specified below:

  •   Retirement. If your employment Terminates due to your Retirement, the
vested portion of your Option may be exercised at any time before the Expiration
Date; provided, however, if your Option is not exercised within three months
after your Retirement date, it will be treated as a Nonqualified Stock Option.

2

--------------------------------------------------------------------------------

 

  •   Death or Disability. If your employment Terminates due to your death or
Disability, the vested portion of your Option may be exercised at any time
before the earlier of the Expiration Date or the first anniversary of your
Termination date.     •   Cause. If your employment is Terminated for Cause,
your Option (whether or not then exercisable) will be forfeited on your
Termination date.     •   Without Cause or By You for Any Reason Other Than
Retirement, Death or Disability. If your employment is Terminated involuntarily
without Cause or by you for any reason other than your Retirement, death or
Disability, (i) the unvested portion of your Option will be forfeited on your
Termination date and (ii) the vested portion of your Option may be exercised at
any time before the earlier of the Expiration Date or 30 days after your
Termination date. Notwithstanding the foregoing, if the 30-day period described
in the preceding sentence expires during a “blackout period” (as described in
our insider trading policy), the vested portion of your Option may be exercised
at any time before the earlier of the Expiration Date or a number of days
following the expiration of the blackout period equal to the number of days
during such blackout period before your Option would have otherwise expired.    
    Example: Assume your employment Terminates voluntarily on July 6. You must
exercise the vested portion of your Option on or before August 5 (which is
30 days after your Terminate date). A blackout period begins on August 1 and
ends on August 7. Subject to the occurrence of the Expiration Date, you would be
given an extension of five days following the end of the blackout period to
exercise the vested portion of your Option. Thus, the vested portion of your
Option could be exercised at any time before the earlier of the Expiration Date
or August 12.

     (c) Effect of Change in Control or Business Combination: If a Change in
Control or Business Combination occurs, the Committee may, but will not be
obligated to:

  •   Cancel your Option for fair value (as determined in the sole discretion of
the Committee) which may equal the excess, if any, of the value of the
consideration to be paid in the Change in Control or Business Combination
transaction, as the case may be, to holders of the same number of Shares subject
to your Option (or, if no consideration is paid in such transaction, the Fair
Market Value of the Shares subject to your Option) over the aggregate Exercise
Price of your Option; or     •   Provide for the issuance of substitute Awards
that will substantially preserve the otherwise applicable terms of your Option
as determined by the Committee in its sole discretion; or     •   Provide that
for a period of 15 days prior to the Change in Control or Business Combination,
as the case may be, your Option will be exercisable as to all Shares subject
thereto and that upon the occurrence of such Change in Control or

3

--------------------------------------------------------------------------------

 

      Business Combination, your Option will terminate and be of no further
force and effect.

     (d) Restrictive Covenants: Unless we or a Related Entity otherwise agree in
writing, any portion of your Option that has not been exercised will be
forfeited if you:

  •   Serve (or agree to serve) as an officer, director, manager, consultant or
employee of any proprietorship, partnership, corporation or limited liability
company or become the owner of a business or a member of a partnership or
limited liability company that competes with any portion of our or a Related
Entity’s business or renders any service to entities that compete with any
portion of our or a Related Entity’s business;     •   Refuse or fail to consult
with, supply information to, or otherwise cooperate with, us or any Related
Entity after having been requested to do so; or     •   Deliberately engage in
any action that the Committee concludes could harm us or any Related Entity.

4. Exercising Your Option
     You must follow the procedures described below to exercise your Option. If
you do not follow these procedures, your attempted exercise will be disregarded.
     (a) Your Option may be exercised with respect to whole Shares only. To
exercise all or any part of the vested portion of your Option, you must take the
following steps before the Option expires:

  •   Complete a copy of the Incentive Stock Option Exercise Form, which is
attached to this Award Agreement as Exhibit A; and     •   Pay the aggregate
Exercise Price for the Shares being purchased through the exercise of the
Option.

     (b) You may pay the aggregate Exercise Price:

  •   By cash, personal check or money order in the amount of the Exercise Price
multiplied by the number of Shares being purchased. The personal check or money
order must be made payable to “Bob Evans Farms, Inc.”     •   Through the
delivery or attestation of Shares owned by you for at least six months before
the Option is exercised (or such other period established by generally accepted
accounting principles). In this case, the Shares delivered or attested must have
a Fair Market Value equal to the aggregate Exercise Price of the Shares being
purchased.     •   To the extent permitted by the Committee, through a “net
share” exercise. In this case, you will be issued a number of Shares with a Fair
Market Value equal to the

4

--------------------------------------------------------------------------------

 

      difference between the Fair Market Value of the Shares being purchased
minus the aggregate Exercise Price of the Shares being purchased.     •   To the
extent permitted by the Committee and by applicable law, through a “cashless
exercise.” In this case, you will deliver irrevocable instructions to a broker
to (i) sell the Shares obtained upon the exercise of the Option and (ii) deliver
promptly to us an amount out of the proceeds of such sale equal to the aggregate
Exercise Price for the Shares being purchased.

     (c) As soon as administratively practicable after our determination that
the Option has been validly exercised as to any of the Shares, we will issue or
transfer the relevant number of Shares to you.
5. Other Rules Affecting Your Option
     (a) Rights Before Your Option Is Exercised: You may not vote or receive any
dividends associated with the Shares underlying the unexercised portion of your
Option.
     (b) Beneficiary Designation: You may name a beneficiary or beneficiaries to
receive or exercise any vested Award that is unpaid or unexercised at your death
by completing a Beneficiary Designation Form. If you have not completed a
Beneficiary Designation Form or if you wish to change your beneficiary, you may
complete the Beneficiary Designation Form attached to this Award Agreement as
Exhibit B. The Beneficiary Designation Form does not need to be completed now
and is not required to be completed as a condition of exercising your Option.
However, if you die without completing a Beneficiary Designation Form or if you
do not complete the form correctly, your beneficiary will be your surviving
spouse or, if you do not have a surviving spouse, your estate.
(c) Tax Withholding:
     (i) You may be required to pay to us or a Related Entity and, subject to
Code §409A, we or any Related Entity will have the right and are hereby
authorized to withhold from any issuance or transfer due under this Award
Agreement or under the Plan or from any compensation or other amount owing to
you, applicable withholding taxes with respect to your Option, its exercise or
any issuance or transfer under this Award Agreement or the Plan and to take such
action as may be necessary in our opinion to satisfy all obligations for the
payment of such taxes.
     (ii) Without limiting the generality of Section 5(c)(i), to the extent
permitted by the Committee, you may satisfy the foregoing withholding liability:
(A) by having us withhold from the number of Shares that otherwise would be
issued to you when you exercise your Option a number of Shares with a Fair
Market Value equal to the statutory minimum withholding liability; (B) through
the delivery or attestation of a number of Shares owned by you for at least six
months before the Option is exercised (or such other period established by
generally accepted accounting principles) and that have a Fair Market Value
equal to the statutory minimum withholding liability; or (C) to the extent
permitted by applicable law, by delivering irrevocable instructions to a broker
to (I) sell

5

--------------------------------------------------------------------------------

 

the Shares obtained upon the exercise of the Option and (II) deliver promptly to
us an amount out of the proceeds of such sale equal to the statutory minimum
withholding liability.
     (d) Transferring Your Option: In general, your Option may not be sold,
transferred, pledged, assigned or otherwise alienated or hypothecated, except by
will or the laws of descent and distribution. However, as described in
Section 5(b), you may complete a Beneficiary Designation Form to name the person
who may exercise your Option if you die before the Option expires.
     (e) Governing Law: This Award Agreement will be construed in accordance
with and governed by the laws (other than laws governing conflicts of laws) of
the State of Ohio except to the extent that the Delaware General Corporation Law
is mandatorily applicable.
     (f) Other Agreements: Your Option will be subject to the terms of any other
written agreements between you and us to the extent that those other agreements
do not directly conflict with the terms of the Plan or this Award Agreement.
     (g) Adjustments to Your Option: If there is a Share dividend, Share split,
recapitalization (including payment of an extraordinary dividend), merger,
consolidation, combination, spin-off, distribution of assets to stockholders,
exchange of Shares or other similar corporate change affecting Shares, the
Committee will appropriately adjust the number of Shares subject to your Option,
the Exercise Price and any other factors, limits or terms affecting your Option.
Any decision by the Committee as to the appropriate adjustments to be made to
your Option will be binding on you.
     (h) Buy Out of Option: We may offer to buy for cash or by substitution of
another Award (but only to the extent that the offer and the terms of the offer
do not, and on their face are not likely to, generate penalties under Code §409A
or violate any other applicable law) your Option, whether or not exercisable, by
providing to you written notice (“Buy Out Offer”) of our intention to exercise
the rights reserved in Section 15.05 of the Plan and other information, if any,
required to be included under applicable securities laws. If a Buy Out Offer is
made and you accept it, we will transfer to you the value (determined under
procedures adopted by the Committee) of your Option. We will complete any such
buy out as soon as administratively feasible after the date you accept the Buy
Out Offer.
     (i) Other Terms and Conditions: Your Option is subject to the terms and
conditions described in this Award Agreement and the Plan, which is incorporated
by reference into and made a part of this Award Agreement. You should read the
Plan carefully to ensure you fully understand all the terms and conditions of
your Option. In the event of a conflict between the terms of the Plan and the
terms of this Award Agreement, the terms of the Plan will govern. The Committee
has the sole responsibility of interpreting the Plan and this Award Agreement,
and its determination of the meaning of any provision in the Plan or this Award
Agreement shall be binding on you.

6

--------------------------------------------------------------------------------

 

     (j) Signature in Counterparts: This Award Agreement may be signed in
counterparts, each of which will be deemed an original, but all of which will
constitute one and the same instrument.
*       *       *       *       *
Your Acknowledgment
By signing below as the “Participant,” you acknowledge and agree that:

  •   A copy of the Plan has been made available to you; and     •   You
understand and accept the terms and conditions placed on your Option and
understand what you must do to exercise your Option.

                      PARTICIPANT                
 
                   
 
          Date:                           Signature                
 
                                      Print Name                
 
                    BOB EVANS FARMS, INC.                
 
                   
By:
          Date:        
 
                   
 
  [Insert name and title]                

7

--------------------------------------------------------------------------------

 

EXHIBIT A
BOB EVANS FARMS, INC.
2006 EQUITY AND CASH INCENTIVE PLAN
INCENTIVE STOCK OPTION EXERCISE NOTICE
By completing this Notice and returning it to the Company at the address given
below, I elect to exercise all or a portion of the Option and to purchase the
Shares described below. Capitalized terms not defined in this Notice have the
same meanings as in the Plan and applicable Award Agreement.
Note: You must complete a separate Notice for each Option that is being
exercised (e.g., if you are simultaneously exercising an Option to purchase 200
Shares granted on June 30, 2007 and an Option to purchase 100 Shares granted on
July 15, 2007, you must complete two Notices, one for each Option being
exercised).
     Option to be Exercised and Shares: This Notice relates to the exercise of
the following Option for the following number of Shares (fill in the blanks):
     Grant Date of Option:                                         
     Number of Shares Being Purchased Under Notice:
                                        
Exercise Price: The aggregate Exercise Price due is
$                                        .
Note: This amount must equal the product of the Exercise Price per Share
specified in the applicable Award Agreement multiplied by the number of Shares
being purchased.
Payment of Exercise Price: I have decided to pay the Exercise Price by (check
one):

  —   Cash or personal check or money order payable to “Bob Evans Farms, Inc.”
If you select this method, you must include full payment of the aggregate
Exercise Price with this Notice.     —   Through the delivery or attestation
process described in the applicable Award Agreement. If you select this method,
you should contact us at the address below regarding this method’s effect on the
number of Shares you will receive upon exercise of your Option.     —   Through
a “net share” exercise, as described in the applicable Award Agreement. If you
select this method, you should contact us at the address below regarding this
method’s effect on the number of Shares you will receive upon exercise of your
Option.     —   Through a “cashless exercise,” as described in the applicable
Award Agreement. If you select this method, you should contact us at the address
below regarding this method’s effect on the number of Shares you will receive
upon exercise of your Option.

*       *       *       *       *
Acknowledgement
By signing below, I acknowledge and agree that:

  •   I fully understand the tax consequences of exercising the Option and
buying Shares and understand that there is no guarantee that the value of these
Shares will appreciate;     •   This Notice will not be effective if it is not
returned to the Company at the address given below before the date the Option
expires, as specified in the Award Agreement under which such Option was issued
or if full payment of the aggregate Exercise Price is not made as described in
this Notice; and

 

--------------------------------------------------------------------------------

 

  •   The Shares that I am buying pursuant to this Notice will be issued or
transferred to me as soon as administratively practicable.

                 (Participant’s signature)                  (Participant’s
printed name)          
Date signed:
       
 
 
 
     

Return this signed and completed Notice to us at the following address:
[Insert Title]
Bob Evans Farms, Inc.
3776 S. High St.
Columbus, Ohio 43207

2

--------------------------------------------------------------------------------

 

EXHIBIT B
BOB EVANS FARMS, INC.
2006 EQUITY AND CASH INCENTIVE PLAN
BENEFICIARY DESIGNATION FORM
     Primary Beneficiary Designation. I designate the following person(s) as my
primary beneficiary or beneficiaries, in the proportion specified, to receive or
to exercise any vested Awards under the Bob Evans Farms, Inc. 2006 Equity and
Cash Incentive Plan (the “Plan”) that are unpaid or unexercised at my death:

                 
 
      % to        
 
               
 
          (Name)   (Relationship)
 
  Address:                      
 
               
 
      % to        
 
               
 
          (Name)   (Relationship)
 
  Address:                      
 
               
 
      % to        
 
               
 
          (Name)   (Relationship)
 
  Address:                      
 
               
 
      % to        
 
               
 
          (Name)   (Relationship)
 
  Address:                      

Note: You are not required to name more than one primary beneficiary but, if you
do, the sum of these percentages may not be greater than 100 percent.
Contingent Beneficiary Designation. If one or more of my primary beneficiaries
dies before I die, I direct that any vested Awards under the Plan that are
unpaid or unexercised at my death and that might otherwise have been paid to
that beneficiary be:
___Allocated to my other named primary beneficiaries in proportion to the
allocation given above (ignoring the interest allocated to the deceased primary
beneficiary); or
___Allocated, in the proportion specified, among the following contingent
beneficiaries:

                 
 
      % to        
 
               
 
          (Name)   (Relationship)
 
  Address:                      
 
               
 
      % to        
 
               
 
          (Name)   (Relationship)
 
  Address:                      
 
               
 
      % to        
 
               
 
          (Name)   (Relationship)
 
  Address:                      
 
               
 
      % to        
 
               
 
          (Name)   (Relationship)
 
  Address:                      

Note: You are not required to name more than one contingent beneficiary but, if
you do, the sum of these percentages may not be greater than 100 percent.

         
 
       
(Signature)
  (Date)    
 
       
 
 (Print Name)
       

Please return an executed copy of this form to us at the following address:
[Insert Title], Bob Evans Farms, Inc., 3776 S. High St., Columbus, Ohio 43207.