Document:

Exhibit 10.1

Exhibit 10.1

As amended, May 25, 2006 and

July 23, 2009

PANERA BREAD COMPANY

2005 LONG-TERM INCENTIVE PROGRAM

(Sub-plan under 2006 Stock Incentive Plan)

Section 1. Establishment.

Effective September 1, 2005, Panera Bread Company (the “Company”) established the Long-Term
Incentive Program (the “LTIP”) as a sub-plan under the Company’s 1992 Equity Incentive Plan (the
“1992 Plan”) and the Company’s 2001 Employee, Director and Consultant Stock Option Plan (the “2001
Plan”). Effective May 25, 2006, the Company will not grant any further awards under the 1992 Plan
or the 2001 Plan. Effective May 25, 2006, the LTIP will be a sub-plan under the Company’s 2006
Stock Incentive Plan (the “2006 Plan”). Notwithstanding anything to the contrary herein, except to
the extent permitted by the 2006 Plan, the provisions of the 2006 Plan shall apply for purposes of
the LTIP with respect to any awards under the 2006 Plan.

Section 2. General Purpose of the Plan and Definitions.

The purpose of the LTIP is to provide eligible individuals with a meaningful stake in the Company’s
success through long-term incentive awards. In doing so, the Company hopes to motivate and reward
the attainment of longer-term profitable growth goals, support the recruitment and retention of
individuals critical to the long-term success of the Company and align individual participants’
interests with those of customers and stockholders.

Except to the extent required by the 2006 Plan, whenever used in the LTIP, the following terms
shall have the meanings set forth in this Section 2. Capitalized terms not otherwise defined herein
shall have the meanings set forth in the 2006 Plan.

	 	a)	 	Cause. Cause shall include (and is not limited to) dishonesty with
respect to the Company or any affiliate of the Company, insubordination, substantial
malfeasance or non-feasance of duty, unauthorized disclosure of confidential
information, or conduct substantially prejudicial to the business of the Company or any
affiliate of the Company or any other circumstance which would constitute or be deemed
“cause” pursuant to any other agreement entered into between an LTIP Participant and
the Company or an affiliate of the Company, as determined by the Committee or any
officer designated by it, in its, his or her sole discretion. The determination of the
Committee or such designated officer as to the existence of Cause will be conclusive on
the LTIP Participant and the Company.

	 	b)	 	Change in Control. Any of the following events: (i) the purchase or
other acquisition by any person, entity or group of persons, within the meaning of
Section 13(d) or 14(d) of the Securities Exchange Act of 1934 (the “Act”) (excluding,
for this purpose, the Company, its affiliates and any employee benefit plan (or related
trust) of the Company or its affiliates), of beneficial ownership (within the meaning
of Rule 13d-3 promulgated under the Act) of 50% or more of the combined voting power of
the Company’s then- outstanding voting securities entitled to vote generally in the
election of directors in any transaction or series of transactions; (ii) when
individuals who, as of the effective date of the LTIP, constitute the Board (the
“Incumbent Board”) cease for any reason to constitute at least a majority of the Board,
provided that any person who becomes a director subsequent to the effective date of the
LTIP whose election, or nomination for election by the Company’s stockholders, was
approved in advance by a vote of at least a majority of the directors then comprising
the Incumbent Board excluding members of its Incumbent Board who are no longer serving
as directors shall be, for purposes of this section, considered as though such person
were a member of the Incumbent Board; provided, however, the following persons shall
not be considered members of the Incumbent Board: (a) individuals whose initial
assumption of office is in connection with an actual or threatened election contest
relating to the election of directors of the Company, as such terms are used in Rule
14a-11 of Regulation 14A promulgated under the Act and (b) individuals approved by the
Incumbent Board as a result of an agreement intended to avoid or settle an actual or
threatened contest; (iii) consummation of a reorganization, merger or consolidation,
except in each

 

 

 

	 	 	 	case following such reorganization, merger or consolidation: (a) persons who were the stockholders of the Company immediately prior to
such reorganization, merger or consolidation immediately thereafter own more than 50% of
the combined voting power entitled to vote generally in the election of directors of the
reorganized, merged or consolidated corporation’s then-outstanding voting securities,
and (b) a majority of members of the board or other governing body of such reorganized,
merged or consolidated corporation were members of the Incumbent Board at the time of
the execution of the initial agreement or the approval of the transaction by the Board;
(iv) approval by stockholders of a liquidation or dissolution of the Company (and the
Company shall commence such liquidation or dissolution), or consummation of the sale of
all or substantially all of the assets of the Company (in one transaction or a series of
transactions); or (v) any other event that a majority of the members of the Incumbent
Board, in their sole discretion, shall determine may constitute a Change in Control.

	 	c)	 	Choice Award. An award that provides designated LTIP Participants with
the choice to receive the award in a) Restricted Stock, b) a Stock Settled Appreciation
Right (“SSAR”) (or, if determined by the Committee, Stock Options), or c) a combination
of Restricted Stock and a SSAR.

	 	d)	 	Committee. The Compensation and Stock Option Committee of the Board of
Directors of the Company, or any successor committee designated by such Board to assume
the responsibilities for the administration of this LTIP.

	 	e)	 	Deferred Annual Bonus Match Award. A deferred bonus that is awarded to
designated LTIP participants based on a percentage of the LTIP Participant’s earned
annual bonus as determined in accordance with Section 8(a.)

	 	f)	 	Disability. Permanent and total disability as defined in Section
22(e)(3) of the Code.

	 	g)	 	Fair Market Value. With respect to Common Stock:

	 	(i)	 	if the Common Stock is listed on a national securities exchange or traded in the
over-the counter market and sales prices are regularly reported for the Common Stock,
the closing or last price of the Common Stock on the Composite Tape or other comparable
reporting system on the date of grant or determination;

	 	(ii)	 	if the Common Stock is not traded on a national securities exchange but is traded
on the over-the- counter market, if sales prices are not regularly reported for the
Common Stock for the trading day referred to in Section 2(g)(i), and if bid and asked
prices for the Common Stock are regularly reported, the mean between the bid and the
asked price for the Common Stock at the close of trading in the over-the-counter market
for the trading day on which Common Stock was traded on the date of grant or
determination; and

	 	(iii)	 	if the Common Stock is neither listed on a national securities exchange nor traded
in the over-the- counter market, such value as the Committee, in good faith, shall
determine.

	 	g)	 	LTIP Award. Any Performance Award, Restricted Stock, Choice Award or
Deferred Annual Bonus Match awarded to an LTIP Participant in accordance with Section
5, 6, 7 or 8.

	 	h)	 	LTIP Participant. A director, employee or consultant of the Company or
any affiliate of the Company as designated in Section 4 for participation in one or
more programs under the LTIP; provided, however, that with respect to any awards under
the 2006 Plan, only those persons eligible for those awards under those respective
plans may receive such awards under the LTIP.

	 	i)	 	Stock Option. A non-statutory stock option granted pursuant to an LTIP
Participant’s election of such option in accordance with Section 7.

	 	j)	 	Performance Award. An award determined in accordance with Section 5(a)
and payable to designated LTIP Participants on the basis of the achievement of
Performance Goals for a Performance Period.

 

 

 

	 	k)	 	Performance Goal. One or more goals, which may include financial and
non-financial measures, established by the Committee for a Performance Period.

	 	l)	 	Performance Period. One or more periods of time, which may be varying
and overlapping durations, as the Committee may select, over which the attainment of
one or more Performance Goals will be measured for purposes of determining an LTIP
Participant’s right to and the payment of any Performance Awards.

	 	m)	 	Restricted Stock Award. An award determined in accordance with Section
6.

	 	n)	 	Stock Settled Appreciation Right. A Stock Settled Appreciation Right
(“SSAR”), granted pursuant to an LTIP Participant’s election of such choice in
accordance with Section 7, is an award in the form of a right to receive Common Stock,
upon exercise of the SSAR, in an amount equal to the appreciation in the value of the
underlying Common Stock over a base price established in the SSAR. The SSAR holder,
upon exercise, shall be entitled to receive an amount of Common Stock equal to the
quotient of (i) the product of (x) the amount by which the Fair Market Value of the
Common Stock on the date of exercise exceeds the measurement price established pursuant
to the applicable SSAR agreement, provided that such measurement price shall not be
less than 100% of the Fair Market Value of the Common Stock on the date of grant,
multiplied by (y) the number of shares of Common Stock subject to the SSAR being
exercised, divided by (ii) the Fair Market Value of the Common Stock on the date of
exercise. Each SSAR will be exercisable at such times and subject to such terms and
conditions as the Committee may specify in the applicable SSAR agreement; provided,
however, that no SSAR will be granted for a term in excess of 10 years.

Section 3. Administration of LTIP

The LTIP shall be administered by the Committee, and all interpretations and decisions with respect
to the application of LTIP shall be at the sole discretion of the Committee. The Committee shall
have the authority to determine the terms and conditions, including but not limited to any
restrictions and vesting conditions related to LTIP Awards or any required acknowledgments or
agreements for any awards, not inconsistent with the terms of the LTIP and 2006 Plan, and to
approve the form of written instruments and the terms and conditions evidencing LTIP Awards. The
Committee may at any time adopt, alter and repeal such administrative rules, guidelines and
practices governing the operation of the LTIP as it shall from time to time decide. To the extent
permitted by applicable law and the 2006 Plan, the Committee, in its sole discretion, may delegate
to the Chief Executive Officer and/or other

designated officers of the Company all or part of the Committee’s authority and duties with respect
to the granting of LTIP Awards.

All decisions and interpretations of the Committee shall be binding on all persons, including the
Company and LTIP Participants.

Section 4. Eligibility and Participation in LTIP.

Except as provided by law or in the 2006 Plan, the Chief Executive Officer and/or other officers of
the Company appointed by the Committee from time to time shall designate eligible individuals for
participation in the LTIP, and the LTIP Award(s) for which such individuals shall be eligible, in
his or their sole discretion, subject to the approval of the Committee; provided, however, that the
LTIP participation of the Chief Executive Officer shall be determined by the Committee.

 

 

 

Section 5. Performance Award.

An LTIP Participant shall be eligible for Performance Awards, if so selected by the Committee or
its delegatee, in accordance with the following guidelines (which may be adjusted by the Committee
from time to time in its sole discretion with respect to one or more LTIP Participants and which
may not be uniform among LTIP Participants for each award):

	 	a)	 	Target Award. For each Performance Period, a designated LTIP
Participant as determined as of the first day of the Performance Period and to whom the
Committee determines, in its sole discretion, to grant a Performance Award under this
Section 5(a) shall be granted a target Performance Award equal to a percentage of his
or her annualized base salary in effect as of the first day of the first fiscal year in
the Performance Period, or date of hire, if later, or such other date if so determined
by the Committee. To the extent required by the 2006 Plan, Performance Awards shall be
subject to the terms and conditions of the 2006 Plan.

Notwithstanding the foregoing, an individual who first becomes an LTIP Participant under
Section 4 after the beginning of a Performance Period and to whom the Committee
determines, in its sole discretion, to grant an LTIP Award under this Section 5(a) shall
be awarded a pro rata target Performance Award determined by the Committee on the basis
of his or her annualized base salary in effect upon being designated to receive a
Performance Award and the length of time since designation remaining in the Performance
Period.

	 	b)	 	Performance Goals. With respect to each Performance Award granted to
designated LTIP Participants, the Committee shall select, within the first 90 days or,
if less, the first 25% of a Performance Period (or within the first year in the case of
the first Performance Period selected hereunder by the Committee), the Performance
Goals for such Performance Award, and the achievement targets with respect to each
Performance Goal, and may select a threshold level of performance below which no amount
will become payable with respect to such Performance Award, and a maximum Performance
Award. Notwithstanding the foregoing sentence, consistent with the discretion afforded
to the Committee in connection with Performance Awards and in recognition of the
difficulty in establishing multi-year performance metrics that promote the purpose of
the LTIP relative to the determination of Performance Awards, the Committee may grant
Performance Awards of up to the LTIP Participants’ targeted award payout in the event
the minimum threshold level of performance established by the Committee is not achieved
but, in Committee’s judgment, the Company’s performance during the Performance Period
is comparable or exceeds that of its peers, as selected by the Committee. Each
Performance Award will specify the target amount payable, or the formula for
determining the amount payable, upon achievement of the various applicable Performance
Goals. The Performance Goals established by the Committee may be (but need not be)
different for each Performance Period. As soon as practicable following the end of the
Performance Period, the Committee shall determine the extent to which the Performance
Goals have been achieved, and the percentage of the target Performance Award payable
based on the level at which Performance Goals have been achieved.

	 	c)	 	Form of Payment. Performance Awards shall be payable partly in cash
and, provided that sufficient shares of Common Stock are available under the 2006 Plan,
with the remainder payable in whole shares of Common Stock (with any fractional share
paid in cash) based on their Fair Market Value on the day the Committee has determined
that the Performance Goals have been achieved for the Performance Period, or any
combination thereof as determined by the Committee. Shares of Common Stock so issued
shall be issued for no consideration or such minimum consideration as may be required
by applicable law. To the extent that sufficient shares of Common Stock are not
available, the portion of the Performance Award otherwise payable in Common Stock shall
be paid in cash.

	 	d)	 	Payment of Performance Awards. Payment shall be made in a lump sum as
soon as practicable following the Committee’s determination regarding achievement of
the Performance Goals, but in no event later than two and one half months following the
close of the Performance Period. Except as provided in Section 10, an LTIP Participant
must be employed on the day of payout in order to receive payment of a Performance
Award for such Performance Period.

	 	e)	 	Unfunded Liability. The Performance Award shall be unfunded and shall
not create (or be construed to create) a trust or separate fund. Likewise, the
Performance Award shall not establish any fiduciary relationship between the Company
and the LTIP Participant. To the extent that any LTIP Participant holds any rights by
virtue of a LTIP Award, such rights shall be no greater than the rights of an unsecured
general creditor of the Company.

 

 

 

Section 6. Restricted Stock Award.

Subject to the provisions of the 2006 Plan, an LTIP Participant shall be eligible for one or more
grants of Restricted Stock, if so selected by the Committee or its delegatee, on such date(s) as
shall be determined by the Committee in accordance with the following guidelines (which may be
adjusted by the Committee from time to time in its sole discretion with respect to one or more LTIP
Participants and which may not be uniform among LTIP Participants for each award):

	 	a)	 	Target Award. LTIP Participants, as designated in accordance with
Section 4, shall be granted a target Restricted Stock Award equal to a number of shares
of Restricted Stock as determined by the Committee.

Shares of Restricted Stocks shall be issued for no consideration or such minimum
consideration as may be required by applicable law.

	 	b)	 	Restrictions. A Restricted Stock Award entitles the recipient to
receive shares of Common Stock subject to such restrictions and conditions as the
Committee may determine at the time of grant. Conditions may be based on continuing
employment (or other service relationship) and/or achievement of pre-established
performance conditions, or such other conditions as the Committee may determine. The
grant of Restricted Stock is contingent on the grantee executing a Restricted Stock
Award agreement and such other acknowledgments or agreements as determined by the
Committee in its sole discretion. The terms and conditions of each Restricted Stock
Award agreement and such other acknowledgments and agreements shall be determined by
the Committee and such terms and conditions may differ among individual awards and
grantees.

Restricted Stock may not be sold, assigned, transferred, pledged or otherwise encumbered
or disposed of except as specifically provided herein or in the Restricted Stock Award
agreement and consistent with applicable Company policies.

Notwithstanding anything to the contrary herein, all of the terms of and conditions of
any Restricted Stock Award granted hereunder shall be subject to the terms and
conditions of the 2006 Plan.

	 	c)	 	Vesting of Restricted Stock. The Committee at the time of grant shall
specify the date or dates and/or the attainment of any pre-established performance
goals, objectives and other conditions on which the non-transferability of the
Restricted Stock or forfeiture shall lapse. Subsequent to such date or dates the shares
on which all restrictions have lapsed shall no longer be Restricted Stock and shall be
deemed “vested.” Except as may otherwise be provided by the Committee either in the
Restricted Stock Award agreement or in a subsequent writing after the Restricted Stock
Award agreement is issued, subject to Section 10 below, a grantee’s rights in any
 shares of Restricted Stock that have not vested shall automatically terminate upon the
grantee’s termination of employment with the Company or its affiliates.

Section 7. Choice Award.

Subject to the provisions of the 2006 Plan, an LTIP Participant shall be eligible for Choice
Awards, if so selected by the Committee or its delegatee, in accordance with the following
guidelines (which may be adjusted by the Committee from time to time in its sole discretion with
respect to one or more LTIP Participants and which may not be uniform among LTIP Participants for
each award):

	 	a)	 	Target Award. LTIP Participants as designated in accordance with
Section 4, shall be eligible for a Choice Award under this Section 7 equal to a
percentage of his or her annualized base salary in effect as of the date the Choice
Award is determined.

	 	b)	 	Participant Choice. The LTIP Participant may elect to receive the Award
under Section 7(a) in the form of Restricted Stock and/or in the form of a SSAR (or, if
determined by the Committee, Stock Options) in such proportions and on such terms and
conditions as determined by the Committee in its sole discretion.

 

 

 

If the LTIP Participant elects to receive some or all of the Award under this Section
7(b) in the form of Restricted Stock, the Restricted Stock shall be subject to the terms
and conditions set forth in a Restricted Stock Award agreement approved by the
Committee.

If the LTIP Participant elects to receive some or all of the Award under this Section
7(b) in the form of a SSAR (or, if determined by the Committee, Stock Options), such
SSAR (or Stock Options) shall be subject to the terms and conditions set forth in a SSAR
(or Stock Option) Agreement approved by the Committee.

Any SSAR (or Stock Option) or Restricted Stock Award granted under the 2006 Plan shall be further
subject to the terms and conditions of the 2006 Plan.

Section 8. Deferred Annual Bonus Match Award.

An LTIP Participant shall be eligible for Deferred Annual Bonus Match Awards, if so selected by the
Committee or its delegatee, in accordance with the following guidelines (which may be adjusted by
the Committee from time to time in its sole discretion with respect to one or more LTIP
Participants and which may not be uniform among LTIP Participants for each award):

	 	a)	 	Deferred Award Amount. LTIP Participants, as designated in accordance
with Section 4, shall be granted a Deferred Annual Bonus Match Award under this Section
8 equal to a predetermined percentage, as determined by the Committee, of his or her
annual bonus that is earned and paid by the Company or an affiliate of the Company for
a fiscal year. The payment of any Deferred Annual Bonus Match is subject to the LTIP
Participant’s continued employment, and such other terms and conditions and the
Committee shall establish, through the payment date of any deferred award amounts. The
Committee may, in its sole discretion, increase or decrease, at any time, the
pre-determined percentage match for the Deferred Bonus for any LTIP Participant based
on such LTIP Participant’s individual performance.

Except as otherwise determined by the Committee, an individual who first becomes
eligible for a Deferred Annual Bonus Match as designated in Section 4 during a fiscal
year shall become eligible for such award in the first year that an annual bonus is
earned by the designated LTIP Participant subject to continued employment through the
payment date of any deferred amounts.

	 	b)	 	Deferral Period. The Deferred Annual Bonus Match Award shall be
deferred until a date determined by the Committee for such award (the “Deferral Date”)
and shall become payable within two and one half months of the Deferral Date subject to
continued employment through the date of payment. Except as provided in Section 10, if
the LTIP Participant terminates employment with the Company and all affiliates of the
Company for any reason prior to the payment date such Deferred Annual Bonus Match shall
be forfeited.

Payment of a Deferred Annual Bonus Match shall be made in a lump sum in cash as soon as
practicable following the Deferral Date, but in no event later than two and one half
months following such date subject to continued employment through the payment date.

	 	c)	 	Unfunded Liability. The Deferred Annual Bonus Match Award shall be
unfunded and shall not create (or be construed to create) a trust or separate fund.
Likewise, the Deferred Annual Bonus Match Award shall not establish any fiduciary
relationship between the Company and the LTIP Participant. To the extent that any LTIP
Participant holds any rights by virtue of a LTIP Award, such rights shall be no greater
than the rights of an unsecured general creditor of the Company.

 

 

 

Section 9. Performance Goals and/or Suspension Pending Investigation.

Notwithstanding anything herein to the contrary, the Committee may, in its sole discretion,
establish minimum Performance Goals that must be satisfied in order to be eligible to receive an
LTIP Award, or defer the realization or payment of any outstanding LTIP Awards pending any
investigation(s) pertaining to the performance or termination for “Cause” of an LTIP Participant.

Section 10. Effect of Termination of Service, Change in Control

Notwithstanding anything herein to the contrary, subject to the terms and conditions of the 2006
Plan and except as otherwise specified by the Committee in writing delivered to a LTIP Participant,
in the event of an LTIP Participant’s termination of employment or a Change in Control:

	 	a)	 	General. The Committee shall determine the effect on a LTIP Award of
the Disability, death or other termination of employment of an LTIP Participant and the
extent to which, and the period during which, the LTIP Participant’s legal
representative, guardian or Designated Beneficiary may receive payment of an LTIP Award
or exercise rights thereunder.

	 	b)	 	Change in Control. In order to preserve an LTIP Participant’s rights
under a LTIP Award in the event of an anticipated Change in Control of the Company, the
Committee in its sole discretion may, at the time any LTIP Award is made or at any time
thereafter, take one or more of the following actions, with respect to any group of
LTIP Participants: (i) provide for the acceleration of vesting or payment for any time
period relating to the realization of any such LTIP Award, (ii) provide for the
purchase of any such LTIP Award upon the Participant’s request for an amount of cash or
other property that could have been received upon the exercise or realization of the
LTIP Award had the LTIP Award been currently exercisable, vested or payable, (iii)
adjust the terms of any such LTIP Award in a manner determined by the Committee to
reflect the Change in Control, (iv) cause any such LTIP Award to be assumed, or new
rights substituted therefore, by another entity, or (v) make such other provisions as
the Committee may consider equitable and in the best interests of the Company.

	 	c)	 	Termination for “Cause.” In the event the Committee, or any officer
designated by the Committee, shall determine in its (or his or her) sole discretion
that an LTIP Participant, or any other individual otherwise eligible for participation
in the LTIP, shall have engaged in conduct constituting Cause, then, in such event, (A)
that individual will (i) immediately forfeit his or her eligibility or any rights (if
any) to receive any outstanding LTIP Awards and (ii) lose any eligibility for
consideration for future LTIP Awards and LTIP Participation, (B) any and all SSARs (or
Stock Options) previously granted to such individual shall be cancelled and any and all
Restricted Stock awarded to such individual shall be forfeited, and (C) the Company
shall be entitled to recover from such individual any and all LTIP Awards and any
payments, Common Stock or other consideration delivered pursuant to an LTIP Award or a
SSAR (or Stock Option) under any such Award.

Section 11. Automatic Withholding

Unless otherwise determined by the Committee, concurrent with the vesting of, or lapsing of
restrictions on, any Restricted Stock awarded hereunder, the Company shall withhold a percentage of
shares of such Restricted Stock equal in Fair Market Value to the minimum statutory tax withholding
requirements as required by applicable tax regulations. Unless otherwise determined by the
Committee, upon exercise of a SSAR (or Stock Option), the Company shall withhold a sufficient
number of shares of Common Stock to satisfy any minimum statutory tax withholding requirements as
required by applicable tax regulations. Unless otherwise determined by the Committee, all other
LTIP Awards hereunder shall also be subject to any such applicable withholding.

Section 12. Amendment and Termination.

The Committee may amend, suspend or terminate the LTIP or any portion thereof at any time, subject
to stockholder approval to the extent required under applicable tax or other laws or listing
standards, provided that the restrictions on amendment and termination in the 2006 Plan shall apply
to the extent applicable.

 

 

 

Section 13. Nontransferability.

Except as otherwise provided under or in accordance with the 2006 Plan LTIP Awards may not be sold,
transferred, pledged, assigned or otherwise alienated or hypothecated, and shall not be subject to
execution, attachment or similar process. Any such attempted transfer, pledge, assignment or other
alienation or hypothecation, or the levy of any such execution, attachment or similar process,
shall be null and void.

Section 14. Employment or Other Relationship.

Nothing in the LTIP shall prevent, interfere with or limit in any way the right of the Company or
an affiliate of the Company to terminate any LTIP Participant’s employment, consultancy or
director, officer or advisor status at any time, nor confer upon any LTIP Participant any right to
continue in the employment or other service of the Company or any affiliate of the Company.

Section 15. Governing Law.

The LTIP shall be construed in accordance with and governed by the laws of the State of Delaware.

Section 16. Severability.

If any provision of this LTIP is held invalid or unenforceable by any court of competent
jurisdiction, the other provisions of this LTIP will remain in full force and effect. Any provision
of this LTIP held invalid or unenforceable only in part or degree will remain in full force and
effect to the extent not held invalid or unenforceable.Exhibit 10.2

Exhibit 10.2

PANERA BREAD COMPANY

2005 Long-Term Incentive Program

Form of

Stock Settled Appreciation Right Agreement

(Granted under 2006 Stock Incentive Plan)

THIS AGREEMENT is entered into by and between Panera Bread Company, a Delaware corporation
having a principal place of business in Richmond Heights, Missouri (the “Company”), and the
undersigned [employee] of the Company (the “Participant”).

WHEREAS, pursuant to the 2005 Long-Term Incentive Program (the “LTIP”), the Company desires to
grant to the Participant a stock settled appreciation right with respect to shares of its Class A
Common Stock, $.0001 par value per share (“Common Stock”), subject to certain restrictions set
forth in this Agreement, under and for the purposes set forth in the Company’s 2006 Stock Incentive
Plan (the “Plan”) and the LTIP; and

WHEREAS, the Company and the Participant understand and agree that any terms used and not
defined herein have the same meanings as in the Plan or the LTIP, as applicable; and

NOW, THEREFORE, in consideration of mutual covenants hereinafter set forth and for other good
and valuable consideration, the parties hereto hereby agree as follows:

1. Grant of SSAR.

This Agreement evidences the grant by the Company, on                     , 20_____ 
(the “Grant Date”) to
the Participant, of a stock settled appreciation right (the “SSAR”) exercisable, in whole or in
part, with respect to a total of                      shares (the “Shares”) of Common Stock at a price of
$  per share (the “Measurement Price”) pursuant to the LTIP and the Plan. Unless earlier
terminated, this SSAR shall expire on                     , 20_____ 
(the “Final Exercise Date”).

2. Vesting.

Subject to Sections 3 and 4 of this Agreement, the Plan and the LTIP, this SSAR shall vest as
to 25% of the original number of Shares on the second anniversary of the Grant Date and as to an
additional 25% of the original number of Shares on each successive anniversary following the second
anniversary of the Grant Date until the fifth anniversary of the Grant Date.

The right of exercise shall be cumulative so that to the extent this SSAR is not exercised to
the maximum extent permissible in any period, this SSAR shall continue to be exercisable, in whole
or in part, with respect to all Shares for which it is vested until the earlier of (a) the Final
Exercise Date and (b) the termination of this SSAR under Section 3 hereof, the LTIP or the Plan.

3. Exercise of SSAR.

(a) Form of Exercise. Each election to exercise this SSAR shall be in writing
(substantially in the form attached hereto as Exhibit A), signed by the
Participant, and received by the Company at its principal office, accompanied by this Agreement, or
in such other form or manner approved by the Company. The Participant may exercise this SSAR with
respect to fewer than the number of shares covered hereby, provided that no partial exercise of
this SSAR may be for any fractional share.

 

 

 

(b) Receipt of Stock Upon Exercise. Upon exercise of this SSAR, the Participant shall
receive from the Company a number of shares of Common Stock with a Fair Market Value (as defined in
the LTIP) equal to (i) the excess between (x) the Fair Market Value of one share of Common Stock as
of the date of exercise and (y) the Measurement Price per share of this SSAR, multiplied by (ii)
the number of shares with respect to which this SSAR is being exercised. The Company shall deliver
such shares (net of any shares of Common Stock withheld to satisfy any withholding tax requirements
not otherwise satisfied by the Participant in cash at the time of exercise) as soon as practicable
following the exercise.

(c) Continuous Relationship with the Company Required. Except as otherwise provided
in this Section 3, this SSAR may not be exercised unless the Participant, at the time this SSAR is
exercised, is, and has been at all times since the Grant Date, an employee, officer or director of,
or consultant or advisor to, the Company or any other entity the employees, officers, directors,
consultants or advisors of which are eligible to receive grants under the Plan (an “Eligible
Participant”).

(d) Termination of Relationship with the Company. If the Participant ceases to be an
Eligible Participant for any reason, then, except as provided in paragraph (e) or (f) below, the
right to exercise this SSAR shall terminate three months after such cessation (but in no event
after the Final Exercise Date), provided that this SSAR shall be exercisable only to the extent
that the Participant was entitled to exercise this SSAR on the date of such cessation.
Notwithstanding the foregoing, if the Participant, prior to the Final Exercise Date, violates the
non-competition or confidentiality provisions of any employment contract, confidentiality and
nondisclosure agreement or other agreement between the Participant and the Company, the right to
exercise this SSAR shall terminate immediately upon written notice to the Participant from the
Company describing such violation.

(e) Exercise Period Upon Death or Disability. In the event of the death or the
Disability of the Participant prior to the Final Exercise Date while he or she is an Eligible
Participant and the Company has not terminated such relationship for “cause” as specified in
paragraph (f) below, this SSAR shall be exercisable, within the period of one year following the
date of death or Disability of the Participant, by the Participant (or in the case of death by an
authorized transferee) or if earlier, within the term originally prescribed by this Agreement;
provided that this SSAR shall be exercisable only to the extent exercisable but not exercised as of
the date of death or Disability. In the event of death or Disability of the Participant while an
Eligible Participant, a pro rata portion of any additional portion of this SSAR as would have
vested had the Participant not died or sustained a Disability prior to the end of the vesting
accrual period which next ends following the date of death or Disability shall become vested. The
proration shall be based upon the number of days during the accrual period prior to the
Participant’s death or Disability. Notwithstanding the foregoing, in no event shall this SSAR be
exercisable after the Final Exercise Date.

(f) Termination for Cause. If, prior to the Final Exercise Date, the Participant’s
employment or other relationship with the Company is terminated by the Company for Cause (as
defined in the LTIP), the right of the Participant to exercise this SSAR shall terminate
immediately upon the effective date of such termination of employment or other relationship. The
Participant shall be considered to have been discharged for “Cause” if the Company determines,
within 30 days after the Participant’s resignation, that discharge for cause was warranted.

(g) Compliance Restrictions. The Company shall not be obligated to issue to the
Participant the Shares upon the vesting of this SSAR (or otherwise) unless the issuance and
delivery of such Shares shall comply with all relevant provisions of law and other legal
requirements including any applicable federal or state securities laws and the requirements of any
stock exchange or quotation system upon which Common Stock may then be listed or quoted.

 

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4. Restrictions on Transfer.

This SSAR may not be sold, assigned, transferred, pledged or otherwise encumbered by the
Participant, either voluntarily or by operation of law, except by will or the laws of descent and
distribution, and, during the lifetime of the Participant, this SSAR shall be exercisable only by
the Participant.

5. No Rights as Stockholder.

Except as set forth in the Plan, neither the Participant nor any person claiming under or
through the Participant shall be, or shall have any rights or privileges of, a stockholder of the
Company in respect of any Share issuable pursuant to this SSAR granted hereunder until such Share
has been delivered to the Participant.

6. Withholding Taxes.

No Shares will be issued pursuant to the exercise of this SSAR unless and until the
Participant pays to the Company, or makes provision satisfactory to the Company for payment of, any
federal, state or local withholding taxes required by law to be withheld in respect of this SSAR.

7. Provisions of the Plan.

This SSAR is subject to the provisions of the LTIP and the Plan, copies of which is being
furnished to the Participant with this Agreement.

8. Miscellaneous.

(a) Severability. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision of this Agreement,
and each other provision of this Agreement shall be severable and enforceable to the extent
permitted by law.

(b) Waiver. Any provision for the benefit of the Company contained in this Agreement
may be waived, either generally or in any particular instance, by the Board of Directors of the
Company.

(c) Binding Effect. This Agreement shall be binding upon and inure to the benefit of
the Company and the Participant and their respective heirs, executors, administrators, legal
representatives, successors and assigns, subject to the restrictions on transfer set forth in
Section 4 of this Agreement.

(d) Notice. All notices required or permitted hereunder shall be in writing and
deemed effectively given upon personal delivery or five days after delivery to a United States Post
Office, by registered or certified mail, postage prepaid, addressed to the other party hereto at
the address shown beneath his or its respective signature to this Agreement, or at such other
address or addresses as either party shall designate to the other in accordance with this paragraph
(d).

(e) Entire Agreement. This Agreement and the Plan constitute the entire agreement
between the parties, and supersede all prior agreements and understandings, relating to this SSAR.

 

3

 

(f) Participant’s Acknowledgments. The Participant acknowledges that he or she: (i)
has read this Agreement; (ii) has been represented in the preparation, negotiation, and execution
of this Agreement by legal counsel of the Participant’s own choice or has voluntarily declined to
seek such counsel; (iii) understands the terms and consequences of this Agreement; (iv) is fully
aware of the legal and binding effect of this Agreement; and (v) understands that the law firm of
Wilmer Cutler Pickering Hale and Dorr
LLP, is acting as counsel to the Company in connection with the transactions contemplated by
the agreement, and is not acting as counsel for the Participant.

(g) Unfunded Rights. The right of the Participant to receive Common Stock pursuant to
this Agreement is an unfunded and unsecured obligation of the Company. The Participant shall have
no rights under this Agreement other than those of an unsecured general creditor of the Company.

(h) Deferral. Neither the Company nor the Participant may defer delivery of any
Shares with respect to this SSAR.

[Remainder of Page Intentionally Left Blank]

 

4

 

IN WITNESS WHEREOF, the Company has caused this SSAR Agreement to be executed under its
corporate seal by its duly authorized officer. This SSAR Agreement shall take effect as a sealed
instrument.

	 	 	 	 	 	 	 
	 	 	PANERA BREAD COMPANY
	 
	 	 	 	 	 	 
	Dated:                         

	 	By:	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	 	 	 

 

5

 

PARTICIPANT’S ACCEPTANCE

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions
thereof. The undersigned hereby acknowledges receipt of a copy of the Company’s 2006 Stock
Incentive Plan and 2005 Long-Term Incentive Plan.

	 	 	 	 	 	 	 
	 	 	PARTICIPANT:
	 
	 	 	 	 	 	 
	Dated:                     

	 	By:	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Address:	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 

 

6

 

Exhibit A

NOTICE OF EXERCISE OF STOCK APPRECIATION RIGHT

Date:                                          

Panera Bread Company

6710 Clayton Road

Richmond Heights, Missouri 63117

Attn: Treasurer

Dear Sir or Madam:

I am the holder of a Stock Appreciation Right granted to me by Panera Bread Company (the
“Company”) under its 2006 Stock Incentive Plan and 2005 Long-Term Incentive Program on
                    , 20_____, with respect to a total of                      shares of Common Stock of the Company,
at a measurement price of $  per share.

I hereby exercise my Stock Appreciation Right with respect to                      shares of Common
Stock.

	 	 	 	 	 
	 	 	Very truly yours,
	 
	 	 	 	 
	 	 	 
	 

	 	Name:	 	 
	 

	 	 	 	 
	 

	 	Address:

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