Exhibit 10.8


 


STOCK
OPTION AWARD AGREEMENT


FRIENDLY ICE CREAM CORPORATION


1997 STOCK OPTION 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 1997 Stock Option 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.


 


1

















 


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.


 


2

















 


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.


 


3

















 


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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