Einstein Bros 2008 Annual Report Download - page 53

Form 10-K
http://www.sec.gov/Archives/edgar/data/949373/000119312509042707/d10k.htm[9/11/2014 10:10:56 AM]
time of twice the right’ s exercise price.
14. STOCK OPTION AND WARRANT PLANS
1994 and 1995 Plans
Our 1994 Stock Plan (the “1994 Plan”) provided for the granting to employees of incentive stock options and for the granting to employees and
consultants of non-statutory stock options and stock purchase rights. On November 21, 2003, the BOD terminated the authority to issue any
additional options under the 1994 Plan. As of January 1, 2008, all options under the 1994 Plan had expired.
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Table of Contents
EINSTEIN NOAH RESTAURANT GROUP, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Our 1995 Directors’ Stock Option Plan (the “Directors’ Option Plan”) provided for the automatic grant of non-statutory stock options to non-
employee directors of the Company. On December 19, 2003, our BOD terminated the authority to issue any additional options under the Directors’
Option Plan. As of December 30, 2008, options to purchase 996 shares of common stock at a weighted-average exercise price of $10.23 per share
and a weighted-average remaining contractual life of 4.74 years remained outstanding under this plan.
2003 Executive Employee Incentive Plan
On November 21, 2003, our BOD adopted the Executive Employee Incentive Plan, as amended on December 19, 2003, March 1,
2005, February 28, 2007 and April 24, 2007 (the “2003 Plan”). The 2003 Plan provides for granting incentive stock options to employees and
granting non-statutory stock options to employees and consultants. Unless terminated sooner, the 2003 Plan will terminate automatically in
December 2013. The BOD has the authority to amend, modify or terminate the 2003 Plan, subject to any required approval by our stockholders
under applicable law or upon advice of counsel. No such action may affect any options previously granted under the 2003 Plan without the consent
of the holders. There are 2,000,000 shares reserved for issuance pursuant to options granted under the 2003 Plan. Options generally are granted
with an exercise price equal to the fair market value on the date of grant, have a contractual life of ten years and typically vest over a three-year
service period. Generally, 50% of options granted vest upon service. We recognize compensation costs for these awards using a graded vesting
attribution method over the requisite service period. The remaining 50% of options granted vest based on service and financial performance.
Options that do not vest due to the failure to achieve specific financial performance criteria are canceled. As of December 30, 2008, options to
purchase approximately 161,413 shares of our common stock, which are not yet exercisable, are subject to future financial performance conditions.
We recognize compensation costs for performance based options over the requisite service period when conditions for achievement become
probable. For fiscal years 2007 and 2008, 106,738 and 73,967 shares, respectively, were canceled as we did not meet certain financial goals and
the related compensation expense that had been recorded during the year was reversed. As of December 30, 2008, there were 619,979 shares
reserved for future issuance under the 2003 Plan.
2004 Stock Option Plan for Independent Directors
On December 19, 2003, our BOD adopted the Stock Option Plan for Independent Directors, effective January 1, 2004, as amended on March 1,
2005 and February 28, 2007 (the “2004 Directors’ Plan”). Our BOD may amend, suspend, or terminate the 2004 Directors’ Plan at any time,
provided, however, that no such action may adversely affect any outstanding option without the option holder’ s consent. A total of 300,000 shares
of common stock have been reserved for issuance under the 2004 Directors’ Plan. The 2004 Directors’ Plan provides for the automatic grant of
non-statutory stock options to independent directors on January 1 of each year and a prorated grant of options for any director elected during the
year. Options are granted with an exercise price equal to the fair market value on the date of grant, become exercisable six months after the grant
date and are exercisable for five years from the date of grant unless earlier terminated. As of December 30, 2008, there were 73,836 shares
reserved for future issuance under the 2004 Directors’ Plan.
Stock Appreciation Rights Plan
On February 17, 2007, our BOD adopted the Stock Appreciation Rights Plan (the “SAR Plan”). The SAR Plan provides for granting stock
appreciation rights to employees. Unless terminated sooner, the SAR Plan will terminate automatically on March 31, 2012. The BOD has the
authority to amend, modify or terminate the SAR Plan, subject to any required approval by our stockholders under applicable law or upon advice of
counsel, provided that, with limited exception, no modification will adversely affect outstanding rights. There are 150,000 shares issuable pursuant
to stock appreciation rights under the SAR Plan.
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