Document:

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                                                                    EXHIBIT 10.1

                              AFC ENTERPRISES, INC.
                 FORM OF 2004 ADJUSTED SHORT TERM INCENTIVE PLAN

INTRODUCTION

AFC Enterprises, Inc.'s ("AFC") compensation practice is to provide short term
incentive compensation opportunities to selected employees, and in furtherance
of this policy, effective December 29, 2003, AFC adopted the 2004 Short Term
Incentive Plan. Because AFC or certain of its subsidiaries may be engaged in one
or more strategic transactions, AFC has designed this Adjusted Short Term
Incentive Plan to provide you with alternative short term incentive
opportunities based on the successful completion of certain strategic
transactions.

Your personal Adjusted 2004 Incentive Plan is attached as Exhibit B to these
general terms and conditions of this Adjusted Short Term Incentive Plan.

If one or more of the Strategic Transactions (as defined below) identified on
your personal Adjusted 2004 Incentive Plan is consummated within the time
periods defined herein, your incentive compensation opportunities will be based
on this Adjusted Plan.

If none of the Strategic Transactions are consummated within the defined time
period, your short term incentive opportunities will be based on your original
2004 Incentive Plan.

A.       DEFINITIONS

"ADJUSTED PLAN" means, with respect to any Participant, this 2004 Adjusted Short
Term Incentive Plan together with the Adjusted 2004 Incentive Plan (which is
attached as Exhibit B) for such Participant.

"ANNUAL INCENTIVE TARGET" means the target amount for annual incentive payments
set by the Compensation Committee for a Participant under the 2004 Short Term
Incentive Plan.

"CFC" means AFC's Church's Chicken division.

"CI" means Cinnabon International, Inc. and Cinnabon Inc., collectively.

"COMPENSATION COMMITTEE" means the People Services (Compensation) Committee of
the Board of Directors of AFC.

"CONSIDERATION" shall mean the gross value of all cash, securities and other
property paid (including amounts paid into escrow) by an acquiring party to a
selling party or parties in

<PAGE>

connection with a Strategic Transaction (including without limitation all
amounts paid, distributed or issued to holders of options, warrants, stock
appreciation rights or similar rights or securities in connection with a
Strategic Transaction). The value of any such securities (whether debt or
equity) or other property shall be determined as follows: (1) for securities
that are traded on national securities exchange or in an over-the-counter
market, the value shall equal the last market closing price of such securities
prior to the closing of the Strategic Transaction, and (2) the value of
securities that are not freely tradable or have no established public market, or
for Consideration that consists of property other than securities, the value of
such other securities or property shall be the fair market value thereof.
"Consideration" shall also be deemed to include any indebtedness for borrowed
money or other liabilities or obligations (including, without limitation,
pension liabilities and guarantees) that are assumed, refinanced or paid by the
acquiring party in connection with a Strategic Transaction.

"FAIR MARKET VALUE" means (1) the closing price on a given date for a share of
common stock of AFC quoted on the National Quotation Service or listed on a
national securities exchange, as reported by The Wall Street Journal or, if The
Wall Street Journal no longer reports such closing price, such closing price as
reported by a newspaper or trade journal selected by the Compensation Committee
or, if no such closing price is available on such date, (2) such closing price
as so reported for the immediately preceding business day, or, if no newspaper
or trade journal reports such closing price or if no such price quotation is
available, (3) the fair market value which the Compensation Committee acting in
good faith determines through any reasonable valuation method.

"INCENTIVE COMPENSATION" means any incentive compensation payable under the Plan
or this Adjusted Plan.

"OPCO DIVESTITURE" means a Sale of CI or a Sale of CFC.

"PARTICIPANT" means any employee of AFC or its subsidiaries selected by the
Compensation Committee to participate in this Adjusted Plan.

"PENDING" shall have the meaning assigned thereto in Section B of this Adjusted
Plan.

"PLAN WEIGHTS" means the weight assigned to a particular component of the
Participant's Annual Incentive Target expressed in terms of a percentage of the
Annual Incentive Target.

"SALE OF AFC" means the consummation of any transaction or series of related
transactions pursuant to which, directly or indirectly, all or substantially all
of the stock or assets of AFC is sold, transferred, exchanged or otherwise
disposed of by AFC or its stockholders, including without limitation through (1)
any sale, transfer, exchange or other disposition of stock or assets, (2) any
lease or license of assets with or without a purchase option or (3) any merger,
consolidation, amalgamation, reorganization, reclassification, recapitalization
or share exchange.

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"SALE OF CFC" means the consummation of any transaction or series of related
transactions pursuant to which, directly or indirectly, all or substantially all
of the stock or assets of CFC is sold, transferred, exchanged or otherwise
disposed of by AFC, including without limitation through (1) any sale, transfer,
exchange or other disposition of stock or assets, (2) any lease or license of
assets with or without a purchase option or (3) any merger, consolidation,
amalgamation, reorganization, reclassification, recapitalization or share
exchange.

"SALE OF CI" means the consummation of any transaction or series of related
transactions pursuant to which, directly or indirectly, all or substantially all
of the stock or assets of CI is sold, transferred, exchanged or otherwise
disposed of by AFC, including without limitation through (1) any sale, transfer,
exchange or other disposition of stock or assets, (2) any lease or license of
assets with or without a purchase option or (3) any merger, consolidation,
amalgamation, reorganization, reclassification, recapitalization or share
exchange.

"STRATEGIC TRANSACTION" means a Sale of CI, a Sale of CFC or a Sale of AFC.

"2004 SHORT TERM INCENTIVE PLAN" or "PLAN" mean the AFC Enterprises, Inc. 2004
Short Term Incentive Plan, effective as of December 29, 2003, as adopted by the
Compensation Committee.

Other capitalized terms used herein and not otherwise defined herein shall have
the respective meanings set forth in the 2004 Short Term Incentive Plan.

B.       ADJUSTED 2004 INCENTIVE PLAN AND PLAN WEIGHTS

GENERAL

Each Participant in this Adjusted Plan is also a Participant in the 2004 Short
Term Incentive Plan and previously received a personal 2004 Incentive Plan. The
2004 Incentive Plan set forth the Participant's Annual Incentive Target and the
associated Plan Weights assigned to certain performance metrics or "Plan Goals"
that would be used to determine the amount of Incentive Compensation the
Participant would receive under the Plan for 2004. For instance, a Participant's
2004 Incentive Plan might have set his or her Annual Incentive Target at
$10,000, with Plan Weights that provided that 50% of the Annual Incentive Target
would be payable if AFC's EBITDA as of the end of 2004 reached a certain level
and that another 50% of the Annual Incentive Target would be payable if AFC's
net income for 2004 reached a certain level.

The Compensation Committee has established an Adjusted 2004 Incentive Plan for
each Participant in the Adjusted Plan. Your Adjusted 2004 Incentive Plan is
attached to this Adjusted Plan as Exhibit B. The Adjusted 2004 Incentive Plan
sets forth the same Annual Incentive Target as provided in your 2004 Incentive
Plan, but the Adjusted 2004 Incentive Plan sets forth different Plan Goals (and
associated Plan Weights) for determining the amount of Incentive Compensation
payable to you.

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The 2004 Adjusted Short Term Incentive Plan, including your Adjusted 2004
Incentive Plan, is effective June 1, 2004 and continues in effect for the Plan
Year 2004. Your Adjusted 2004 Incentive Plan sets forth Plan Goals and Plan
Weights that will apply to you if one or more Strategic Transactions are
consummated. For you to receive the Incentive Compensation set forth in your
Adjusted 2004 Incentive Plan, those Strategic Transactions must either be
consummated prior to December 31, 2004 or they must be Pending (as defined
below) on December 31, 2004 and consummated on or before March 31, 2005. If no
Strategic Transaction is consummated within that time period, your Incentive
Compensation for 2004 will be determined under your 2004 Incentive Plan and the
Adjusted 2004 Incentive Plan will have no effect.

A Strategic Transaction will be deemed to be "PENDING" as of December 31, 2004
if either (i) AFC or one of its subsidiaries and the other party or parties
thereto (or their affiliates) have executed a letter of intent relating to such
Strategic Transaction and the Compensation Committee determines, in its sole
discretion, that such Strategic Transaction is reasonably likely to be
consummated on or before March 31, 2005; or (ii) the Compensation Committee
determines, in its sole discretion, that AFC or one of its subsidiaries and the
other party or parties to such Strategic Transaction (or their affiliates) have
substantially negotiated a written agreement pursuant to which such Strategic
Transaction will be effected and that such Transaction is reasonably likely to
be consummated on or before March 31, 2005.

PLAN GOALS AND WEIGHTS

The following is further explanation of certain of the Plan Goals that may be
used for determining the Incentive Compensation payable under your Adjusted 2004
Incentive Plan.

AFC STOCK PRICE APPRECIATION:

If your Adjusted 2004 Incentive Plan assigns a Plan Weight based on AFC Stock
Price Appreciation, the applicable Incentive Compensation will be calculated as
follows:

<TABLE>
<S>                           <C>                         <C>
     Annual                      Plan                        the applicable
   Incentive  multiplied by   Weight for    multiplied by    Incentive Target        Incentive
    Target                     AFC Stock                    Multiple (based on   =  Compensation
                                Price                        AFC Stock Price)
</TABLE>

The "AFC Stock Price" will be equal to the average of the Fair Market Value of
AFC's common stock for the last five trading days for the year ended December
31, 2004. The Incentive Target Multiple for the AFC Stock Price will be equal to
the Incentive Target Multiple set forth on Exhibit A corresponding to such
average stock price (rounded to the nearest $.50).

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SALE OF CFC:

If your Adjusted 2004 Incentive Plan assigns a Plan Weight based on the Sale of
CFC, the applicable Incentive Compensation will be calculated as follows:

<TABLE>
<S>                           <C>                         <C>
     Annual                      Plan                        the applicable
   Incentive  multiplied by   Weight for    multiplied by    Incentive Target        Incentive
    Target                       CFC                         Multiple (based on   =  Compensation
                              Valuation                      CFC Valuation)
</TABLE>

The "CFC Valuation" will be equal to the Consideration received by AFC and its
subsidiaries in connection with a Sale of CFC. The Incentive Target Multiple for
such a Sale of CFC will be equal to the Incentive Target Multiple set forth on
Exhibit A corresponding to such CFC Valuation (rounded to the nearest $5
million).

SALE OF CI:

If your Adjusted 2004 Incentive Plan assigns a Plan Weight based on the Sale of
CI, the applicable Incentive Compensation will be calculated as follows:

<TABLE>
<S>                           <C>                         <C>
     Annual                      Plan                         the applicable
   Incentive  multiplied by   Weight for    multiplied by    Incentive Target        Incentive
    Target                       CI                          Multiple (based on   =  Compensation
                              Valuation                      CI Valuation)
</TABLE>

The "CI Valuation" will be equal to the Consideration received by AFC and its
subsidiaries in connection with a Sale of CI. The Incentive Target Multiple for
such a Sale of CI will be equal to the Incentive Target Multiple set forth on
Exhibit A corresponding to such CI Valuation (rounded to the nearest $750
thousand increment set forth on such exhibit).

SALE OF AFC:

If your Adjusted 2004 Incentive Plan assigns a Plan Weight based on the Sale of
AFC, the applicable Incentive Compensation will be calculated as follows:

<TABLE>
<S>                           <C>                         <C>
     Annual                      Plan                        the applicable
   Incentive  multiplied by   Weight for    multiplied by    Incentive Target        Incentive
    Target                       AFC                         Multiple (based on   =  Compensation
                              Valuation                      AFC Valuation)
</TABLE>

The "AFC Valuation" will be equal to the per share Consideration received by the
holders of AFC's common stock in connection with a Sale of AFC. The Incentive
Target Multiple for such a Sale of AFC will be equal to the Incentive Target
Multiple set forth on Exhibit A corresponding to such per share Consideration
(as rounded to the nearest $0.50).

<PAGE>

MULTIPLE TRANSACTIONS

In some cases, a Participant's Adjusted 2004 Incentive Plan has a set of Plan
Weights that apply if there is a Sale of CI, a Sale of CFC or both. For those
Participants, if only one of those two events occurs (for instance a Sale of CI
occurs but a Sale of CFC does not occur, or vice versa), the Adjusted 2004
Incentive Plan will apply to the Participant, but the Plan Weight associated
with the event that did not occur will be added to the Plan Weight assigned to
AFC Stock Price Appreciation.

In some cases, a Participant's Adjusted 2004 Incentive Plan has one set of Plan
Weights that applies if there is a Sale of CI and/or a Sale of CFC and another
set of Plan Weights that applies if there is a Sale of AFC. For those
Participants, if there is a Sale of CI and/or a Sale of CFC followed by a Sale
of AFC, then the following will apply:

-        upon the consummation of a Sale of CI and/or a Sale of CFC, the
         Participant would receive the amount of Incentive Compensation based on
         the Plan Weight assigned to that Strategic Transaction; and

-        upon the consummation of the Sale of AFC, in determining the
         Participant's Incentive Compensation with respect to that transaction,
         the Plan Weight applicable to the Sale of AFC would be reduced by the
         Plan Weight applicable to the prior Sale of CI and/or Sale of CFC.

For example, assume a Participant has a Plan Weight of 10% for the CI
Valuation (if there is a Sale of CI), but if there is a Sale of AFC the
Participant has a 100% Plan Weight for the AFC Valuation. Also, assume that
there is a Sale of CI followed by a Sale of AFC and that the Participant's
Annual Incentive Target is $10,000. Upon the consummation of the Sale of CI,
the Participant would receive Incentive Compensation based on $1,000 (10% of
the Annual Incentive Target) multiplied by the applicable Incentive Target
Multiple on Exhibit A based on the CI Valuation. Then, upon the consummation
of the Sale of AFC, the Participant would receive Incentive Compensation
calculated as follows:

<TABLE>
<S>                           <C>                         <C>
    $10,000                   $10,000
  (100% of the              (100% of the
     Annual               Annual Incentive                       the applicable
   Incentive    minus     Target payable      multiplied by    Incentive Target         Incentive
    Target)               in connection                        Multiple on Exhibit   =  Compensation
                        with the Sale of CI)                   A (based on the
                                                                AFC Valuation)

</TABLE>

<PAGE>

C.       INCENTIVE COMPENSATION PAYMENTS

Each Participant's Adjusted 2004 Incentive Plan sets forth the payment date for
Incentive Compensation payable with respect to each Plan Goal. The Incentive
Compensation with respect to each Plan Goal will be made in a single payment, as
follows:

-        Any payment to be made with respect to a Strategic Transaction will be
         made on the date such Strategic Transaction is consummated; and

-        Any payment to be made at year-end will be paid within a reasonable
         time following the determination of the amount of such payment, which
         in no event will be prior to December 31, 2004.

If a Strategic Transaction is Pending on December 31, 2004 but is not
consummated prior to March 31, 2005, then the Participant will no longer be
eligible for the Incentive Compensation payable with respect to such Strategic
Transaction. If the failure of such a Strategic Transaction to be consummated
prior to March 31, 2005 results in the Participant no longer being eligible for
Incentive Compensation under this Adjusted Plan, then the Participant's
Incentive Compensation for 2004 will be determined under his or her original
2004 Incentive Plan.

If a Participant becomes eligible for payment of Incentive Compensation under
this Adjusted Plan, any prior payments made to the Participant under the 2004
Short Term Incentive Plan will be deducted from amounts payable under this
Adjusted Plan. For instance, if the Participant receives any Semi-Annual
Incentive Payments under the 2004 Incentive Plan and subsequently becomes
eligible to receive Incentive Compensation under this Adjusted Plan, such
Semi-Annual Incentive Payments will be deducted from amounts to be paid under
this Adjusted Plan.

D.       TERMINATION OF EMPLOYMENT

A Participant will not be entitled to a payment of Incentive Compensation under
this Adjusted Plan unless he or she is employed by AFC or one of its
subsidiaries on the payment date for such payment specified in the Participant's
Adjusted 2004 Incentive Plan (even if such payment is actually made after such
date); provided, however, that in the case of a Strategic Transaction, a
Participant will satisfy this condition if he or she is employed by AFC or one
of its subsidiaries immediately prior to the consummation of such Strategic
Transaction.

E.       ADMINISTRATION

The Compensation Committee of AFC shall be solely responsible for interpreting
and administering the terms of this Adjusted Plan.

<PAGE>

F.       SURVIVAL OF PLAN

Except as specifically modified by this Adjusted Plan, all of the terms and
conditions of the Plan and each Participant's 2004 Incentive Plan will continue
to apply for purposes of the Plan and this Adjusted Plan.EX-10.1 Amendment #4

 

Exhibit 10.1

AMENDMENT NO. 4

TO THE LINCOLN ELECTRIC HOLDINGS, INC

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

(AS AMENDED AND RESTATED AS OF MARCH 1, 2002)

     WHEREAS, Lincoln Electric Holdings, Inc. (the “Company”) adopted the Lincoln Electric
Holdings, Inc. Supplemental Executive Retirement Plan (the “Plan”), originally effective as of
January 1, 1994;

     WHEREAS, the Plan is classified as a “nonqualified deferred compensation plan” under the
Internal Revenue Code of 1986, as amended (the “Code”);

     WHEREAS, the American Jobs Creation Act of 2004, P.L. 108-357 (the “AJCA”) added a new Section
409A to the Code, which significantly changed the Federal tax law applicable to “amounts deferred”
under the Plan after December 31, 2004;

     WHEREAS, pursuant to the AJCA, the Secretary of the Treasury and the Internal Revenue Service
will issue proposed, temporary or final regulations and/or other guidance with respect to the
provisions of the new Section 409A of the Code (collectively with the AJCA, the “Guidance”);

     WHEREAS, effective January 1, 2005, Amendment No. 3 to the Plan froze benefit accruals under
the Plan; and

     WHEREAS, the Company desires to unfreeze benefit accruals under the Plan and make certain
other modifications to the Plan benefits.

     NOW, THEREFORE, the Company hereby adopts this Amendment No. 4 to the Plan, which Amendment is
intended to unfreeze the Plan with respect to all benefit accruals, to provide that all benefit
accruals vested prior to January 1, 2005 will be administered so as to qualify for “grandfather”
status and continue to be governed by the law applicable to nonqualified deferred compensation
prior to the addition of Code Section 409A (as specified in the Plan as in effect before the
adoption of Amendment No. 3 to the Plan), to provide that all benefit accruals that are not so
“grandfathered” will be administered so as to quality under Section 409A of the Code and to set up
a two-tiered benefit structure for new Participants.

     Words used herein the Capital letters that are defined in the Plan are used herein as so
defined.

Section 1

     Effective January 1, 2005, Section 1.3 of the Plan is hereby amended in its entirety to read
as follows:

     Section 1.3. Benefit freeze. (a) The benefit accrual freeze provided for in the Plan
will terminate, and benefit accruals will be reinstated commencing January 1, 2005. Each
Participant’s vested accrued benefit under the Plan on December 31, 2004, will be determined

1

 

based on such Participant’s age and service as determined on such date (the “Participant’s pre
2005 Benefit”).

           (b) With respect to each Participant’s pre-2005 Benefit, the Plan will be administered in a
manner that will comply with the “grandfather” provision of Section 885(d) of the AJCA, including
proposed, temporary or final regulations or any other guidance issued by the Secretary of the
Treasury and Internal Revenue Service with respect thereto (collectively with the AJCA, the
“Guidance”). In all other respects, the Plan is intended to comply with Section 409A of the Code
and shall be construed and interpreted in accordance with such intent. The Committee is authorized
to adopt rules and regulations deemed necessary or appropriate in connection therewith to
anticipate and/or comply with the requirements of the Guidance (including any transition or
grandfather rules thereunder).

Section 2

     Effective January 1, 2005, Section 2.1 of the Plan is hereby amended by adding the following
definition after the definition of “Interest Rate” and before the definition of “Normal Retirement
Date”:

     “Management Committee and Regional President Participant” means a Participant who
serves on the Company’s policy-making committee or a Participant who has been elected by the Board
as a President of a region of the Company, and for whom the Committee
has designated his participation in this Plan as a Management Committee and Regional President Participant.

Section 3

     Effective January 1, 2005, Section 2.1 of the Plan is hereby amended by adding the following
definition after the definition of “Normal Retirement Date” and before the definition of
“Participant”:

     “Other Participant” means a Participant who is not a Management Committee and Regional
President Participant.

Section 4

     Effective January 1, 2005, Subsection (a) of Section 4.1 of the Plan is hereby amended in its
entirety to read as follows:

	 	 	 	 	 	 	 
	

	 	(a)
	 	=
	 	(i) for an individual who was a Participant as of December 31, 2004, one and
four hundred forty-five thousandths percent (1.445%) of such Participant’s Final
Average Pay multiplied by his Years of Service, but not greater than sixty-five percent
(65%) of the Participant’s Final Average Pay; or
	 
	 	 	 	 	 	 
	

	 	 	 	 	 	(ii) for an individual who becomes a Participant on or after January 1, 2005
and who is designated as a Management Committee and Regional President
Participant, one and three hundred thirty-three thousandths percent (1.333%)
of such Participant’s Final Average Pay multiplied by

2

 

	 	 	 	 	 	 	 
	

	 	 	 	 	 	his Years of Service, but not greater than sixty percent (60%) of the
Participant’s Final Average Pay; or
	 
	 	 	 	 	 	 
	

	 	 	 	 	 	(iii) for an individual who becomes a Participant on or after January 1,
2005 and who is designated as an Other Participant, one and one hundred
eleven thousandths percent (1.111%) of such Participant’s Final Average Pay
multiplied by his Years of Service, but not greater than fifty percent (50%)
of the Participant’s Final Average Pay; and

* * *

     The effective date of this Amendment No. 4 is January 1, 2005. Pre 2005 Benefits accrued and
vested prior to January 1, 2005 and that qualify for “grandfather” status under Section 409A of the
Code and Section 885(d) of the AJCA shall continue to be governed by the law applicable to
nonqualified deferred compensation prior to the addition of Section 409A to the Code and shall be
subject to the terms and conditions specified in the Plan as in effect prior to January 1, 2005.

     EXECUTED this ___day of ___, 2005.

LINCOLN ELECTRIC HOLDINGS, INC.

By:_______________________________

Title:____________________________

3

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