INCENTIVE STOCK OPTION AGREEMENT



 Exhibit 10.2 
  
 THE PANTRY, INC. 
  
 INCENTIVE STOCK OPTION AGREEMENT 
  
 THIS INCENTIVE STOCK OPTION AGREEMENT (this “Agreement”) is entered into as of                     
by and between The Pantry, Inc., a Delaware corporation (the “Company”), and                      (“Optionee”) pursuant to
The Pantry, Inc. 1999 Stock Option Plan (as amended September                 , 2004) (the “Plan”). All capitalized terms not otherwise defined herein
shall have the meanings set forth in the Plan. 
  
 R E C I T A L
S: 
  
 A. Optionee is a director, employee or consultant of
the Company and/or of a direct or indirect subsidiary of the Company (individually, a “Subsidiary” and collectively, the “Subsidiaries”) and the Company considers it desirable to give Optionee an added incentive to advance the
Company’s and the Subsidiaries’ interests. 
  
 B. The
Company now desires to grant Optionee the right to purchase shares of Common Stock of the Company pursuant to the terms and conditions of this Agreement and the Plan. 
  
 AGREEMENT: 
  
 NOW, THEREFORE, in consideration of the covenants hereinafter set forth, the parties agree as follows: 
  
 1. Option; Number of Shares. The Company hereby grants to Optionee the
right (the “Option”) to purchase up to a maximum of              shares (the “Shares”) of Common Stock at a price of
$             per share (the “Option Price”) to be paid in accordance with Section 6 hereof. The Option and the right to purchase all or any portion of the Shares are
subject to the terms and conditions stated in this Agreement and in the Plan. If Optionee is an employee of the Company or a subsidiary, the Option is intended to qualify for treatment as an Incentive Stock Option under Section 422 of the Internal
Revenue Code of 1986, as amended (the “Code”). Nevertheless, to the extent that it exceeds the $100,000 rule of Code Section 422(d), this Option shall be treated as a Nonqualified Stock Option. 
  
 2. Vesting. The Option granted hereunder shall vest and become
exercisable in three (3) equal installments of one-third (1/3) of the Shares covered hereby on each of the first, second and third anniversaries of the Vesting Commencement Date. The “Vesting Commencement Date” shall mean
                        . 
  
 3. Term of Agreement. The Option, and Optionee’s right to exercise the Option, shall terminate when the first of the following occurs:

  
 (a) termination pursuant to Section 11 or Section 16 of the
Plan; 







 (b) the expiration of seven (7) years from the date hereof; or 
  
 (c) 90 days after the date of termination of Optionee’s employment or
other relationship with the Company and all of the Subsidiaries, unless such termination results from Optionee’s death or disability (within the meaning of Section 22(e)(3) of the Code) or Optionee dies within 90 days after the date of
termination of Optionee’s employment or other relationship with the Company and all of the Subsidiaries, in which case this Agreement and the Option shall terminate 180 days after the date of termination of Optionee’s employment or other
relationship with the Company and all of the Subsidiaries. 
  
 4.
Termination of Employment or Other Relationship. The termination of Optionee’s employment or other relationship with the Company and the Subsidiaries other than as a result of death or disability shall not accelerate the vesting of the
Option or otherwise affect the number of Shares with respect to which the Option may be exercised, and the Option may only be exercised with respect to that number of Shares that could have been purchased under the Option had the Option been
exercised by Optionee on the date of such termination. The foregoing notwithstanding, the termination of Optionee’s relationship with the Company and the Subsidiaries as a result of death or disability (within the meaning of Section 22(e)(3) of
the Code) shall automatically accelerate the vesting of this Option in full, and this Option shall be exercisable as set forth in Section 5 hereof as to the full number of Shares subject to this Option until the first to occur of the events set
forth in Section 3 above. 
  
 5. No Assignment; Death of
Optionee. The rights of Optionee under this Agreement may not be assigned or transferred except by will, by the laws of descent or distribution and may be exercised during the lifetime of Optionee only by such Optionee; provided, however, that
in the event of disability (within the meaning of Section 22(e)(3) of the Code) of Optionee, a designee of Optionee (or the Optionee’s legal representative if Optionee has not designated anyone) may exercise the Option on behalf of Optionee
(provided the Option would have been exercisable by Optionee) until the right to exercise the Option expires pursuant to Section 3 hereof. Any attempt to sell, pledge, assign, hypothecate, transfer or otherwise dispose of the Option in contravention
of this Agreement or the Plan shall be void. If Optionee should die while Optionee is engaged in an employment or other relationship with the Company and/or any Subsidiary or within 90 days of the termination of such relationship, (provided the
Option would have been exercisable by Optionee) Optionee’s designee, legal representative, or legatee, the successor trustee of Optionee’s inter vivos trust or the person who acquired the right to exercise the Option by reason of the death
of Optionee (individually, a “Successor”) shall succeed to Optionee’s rights under this Agreement. After the death of Optionee, only a Successor may exercise the Option. 
  
 6. Exercise of Option. On or after the vesting of the Option in accordance with Sections 2 and 4 hereof and until
termination of the Option in accordance with Section 3 hereof, the Option may be exercised by Optionee (or such other person specified in Section 5 hereof) to the extent exercisable as determined under Sections 2 and 4 hereof, upon delivery of the
following to the Company at its principal executive offices: 
  

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 (a) a written notice of exercise which identifies this Agreement and states the number of Shares or all
of the Shares then being purchased; 
  
 (b) a check, cash or any
combination thereof in the amount of the aggregate Option Price (or payment of the aggregate Option Price in such other form of lawful consideration as the Committee may approve from time to time under the provisions of Section 8 of the Plan);

  
 (c) a check or cash in the amount reasonably requested by the
Company to satisfy the Company’s withholding obligations under federal, state or other applicable tax laws with respect to the taxable income, if any, recognized by Optionee in connection with the exercise, in whole or in part, of the Option
(unless the Company and Optionee shall have made other arrangements for deductions or withholding from Optionee’s wages, bonus or other income paid to Optionee by the Company or any Subsidiary, provided such arrangements satisfy the
requirements of applicable tax laws); 
  
 7. No Rights as a
Stockholder. Optionee shall have no rights as a stockholder of any shares of Common Stock covered by the Option until the date (the “Exercise Date”) an entry evidencing such ownership is made in the stock transfer books of the Company.
Except as may be provided under Section 11 of the Plan, the Company will make no adjustment for dividends (ordinary or extraordinary, whether in cash, securities or other property) or distributions or other rights for which the record date is prior
to the Exercise Date. 
  
 8. Limitation of Company’s
Liability for Nonissuance. The inability of the Company to obtain, from any regulatory body having jurisdiction, authority reasonably deemed by the Company’s counsel to be necessary for the lawful issuance and sale of any Shares hereunder
and under the Plan, including without limitation registration of the Shares on Form S-8 under the Securities Act of 1933, as amended, shall relieve the Company of any liability in respect of the nonissuance or sale of such Shares as to which such
requisite authority shall not have been obtained. 
  
 9. This
Agreement Subject to Plan. This Agreement is made under the provisions of the Plan and shall be interpreted in a manner consistent with it. To the extent that any provision in this Agreement is inconsistent with the Plan, the provisions of the
Plan shall control. A copy of the Plan is available to Optionee at the Company’s principal executive offices upon request and without charge. The good faith interpretation of the Committee of any provision of the Plan, the Option or this
Agreement, and any determination with respect thereto or hereto by the Committee, shall be final, conclusive and binding on all parties. 
  
 10. Notices. All notices, requests and other communications hereunder shall be in writing and, if given by telegram, telecopy or telex, shall be
deemed to have been validly served, given or delivered when sent, if given by personal delivery, shall be deemed to have been validly served, given or delivered upon actual delivery and, if mailed, shall be deemed to have been validly served, given
or delivered three business days after deposit in the United States mails, as registered or certified mail, with proper postage prepaid and addressed to the party or parties to 
  

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 be notified, at the following addresses (or such other address(es) as a party may designate for itself by like notice):

  
 If to the Company: 
  
 The Pantry, Inc. 
 1801 Douglas Drive 
 Sanford, North Carolina
27330 
 Facsimile: (919) 774-3329 
 Attention: President 
  
 If to Optionee: 
  

	 	


  

	 	


  

	 	


  

	 	


  
 11. Not an Employment or Other Agreement. Nothing contained in this Agreement shall confer, intend to confer or imply any rights to an employment or other relationship or rights to a continued employment or
other relationship with the Company and/or any Subsidiary in favor of Optionee or limit the ability of the Company and/or any Subsidiary to terminate, with or without cause, in its sole and absolute discretion, the employment or other relationship
with Optionee, subject to the terms of any written employment or other agreement to which Optionee is a party. 
  
 12. Governing Law. This Agreement shall be construed under and governed by the laws of the State of Delaware without regard to the conflict of law
provisions thereof. 
  
 13. Counterparts. This Agreement
may be executed in counterparts, each of which shall be deemed an original and both of which together shall be deemed one Agreement. 
  
 IN WITNESS WHEREOF, the Company and Optionee have executed this Agreement as of the date first above written. 
  
  

			
	 THE PANTRY, INC.
  

		
	By:	 	 
	 	 	 Peter J. Sodini
 President and Chief Executive
Officer



  
  
  

			
	 OPTIONEE:
  

	
	 
	
	 
	Print Name


  

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