J & J SNACK FOODS CORP.
NONSTATUTORY STOCK OPTION PLAN
FOR NON-EMPLOYEE DIRECTORS AND CHIEF EXECUTIVE OFFICER
1. Purpose of Plan. The purpose of the J & J Snack Foods
Corp. Nonstatutory Stock Option Plan for Non-Employee Directors
and Chief Executive Officer (the "Plan") contained herein is to
enhance the ability of J & J Snack Foods Corp. (the
"Corporation") to attract, retain and motivate its Chief
Executive Officer ("CEO") and non-employee members of its Board
of Directors and to provide additional incentive to the CEO and
such members of the Board of Directors by encouraging them to
invest in shares of the Corporation's common stock and thereby
acquire a proprietary interest in the Corporation and an
increased personal interest in the Corporation's continued
success and progress, to the mutual benefit of the Corporation
and its shareholders.
2. Aggregate Number of Shares. 440,000 shares of the
Corporation's common stock, no par value per share (the _Common
Stock_), shall be the aggregate number of shares which may be
issued under this Plan. Notwithstanding the foregoing, in the
event of any change in the capitalization of the Corporation,
such as by stock dividend, stock split or what the Board of
Directors of the Corporation deems in its sole discretion to be
similar circumstances, the aggregate number and kind of shares
which may be issued under this Plan shall be automatically
adjusted by the Board of Directors of the Corporation.
Reacquired shares of the Corporation's Common Stock as well as
unissued shares, may be used for the purpose of this Plan.
Common Stock of the Corporation subject to options which have
terminated unexercised, either in whole or in part, shall be
available for future options granted under this Plan.
3. Participation. Each person who is not an employee of
the Corporation or any Corporation subsidiary corporation and who
a director of the Corporation as of May 1 of each year, shall
automatically be granted an option to purchase 3000 shares of the
Corporation's Common Stock. Notwithstanding anything to the
contrary in this Plan, the Chief Executive Officer of the
Corporation shall, as of May 1 of each year, automatically also
be granted an option to purchase 10,000 shares of the
Corporation's Common Stock in addition to 3,000 shares of the
Corporation's Common Stock for every full calendar year the CEO
held such office since the Corporation held its initial public
stock offering in 1986 (treating 1986 as a full calendar year);
provided, however, that (i) the CEO of the Corporation shall not
-1-
receive an option or options to purchase more than 25,000 shares
of Common Stock in any calendar year; and (ii) the maximum number
of shares as to which options may be granted to the CEO of the
Corporation under this Plan shall be 250,000 shares. For
example, in 1991, the CEO would be granted 25,000 shares (10,000
+ (3000 x 5)), since five full years have elapsed.
Notwithstanding the foregoing, in the event of any change in the
capitalization of the Corporation, such as by stock dividend,
stock split, or what the Board of Directors of the Corporation
deems in its sole discretion to be similar circumstances, the
number and kind of shares which may be issued under this Plan
shall be automatically adjusted by the Board of Directors of the
Corporation.
4. Administration of Plan. This Plan shall be
administered by the Compensation Committee appointed by the Board
of Directors of the Corporation. The Compensation Committee
shall consist of a minimum of two Directors, each of whom must be
"an outside director" as defined in Treas. Reg. S1.162-27(e)(3).
The Compensation Committee shall adopt such rules for the conduct
of its business and administration of this Plan as it considers
desirable. The Compensation Committee shall have the exclusive
right to construe the Plan and the options issued pursuant to it,
to correct defects and omissions and to reconcile inconsistencies
to the extent necessary to effectuate the purpose of this Plan
and the options issued pursuant to it, and such action shall be
final, binding and conclusive upon all parties concerned. No
member of the Compensation Committee shall be liable for any act
or omission (whether or not negligent) taken or omitted in good
faith, or for the exercise of any authority or discretion granted
in connection with the Plan to the Compensation Committee, or for
the acts or omissions of any other members of the Board of
Directors.
5. Non-Qualified Stock Options, Option Price and Term.
(a) Options issued pursuant to this Plan shall be nonstatutory or
non-qualified stock options. A non-qualified option is an option
which does not satisfy the requirements of Section 422A of the
Internal Revenue Code of 1986, as amended (the "Code"). The
option price for the non-qualified stock options issued under
this Plan shall be equal to the fair market value, as determined
by the Board of Directors, of the Corporation's Common Stock on
the date of the grant of the option.
(b) Options issued pursuant to this Plan shall be issued
substantially in the form set forth in Appendix I hereof, which
form is hereby incorporated by reference and made a part hereof,
and shall contain substantially the terms and conditions set
forth herein. Options shall expire ten years after the date they
are granted, unless terminated earlier as provided herein.
-2-
6. Modification, Amendment, Suspension and Termination.
Options shall not be granted pursuant to this Plan after the
expiration of ten years from and after April 9, 1991, the date
this Plan was approved by the Board of Directors of the
Corporation. This Plan must be subject to approval by the
shareholders of the Corporation as provided in Section 7(e) of
this Plan. The Board of Directors of the Corporation reserves
the right at any time, and from time to time, to modify or amend
this Plan in any way, or to suspend or terminate it, effective as
of such date, which date may be either before or after the taking
of such action, as may be specified by the Board of Directors of
the Corporation; provided, however, that (a) such action shall
not affect options granted under the Plan prior to the actual
date on which such action occurred, (b) the Plan provisions
described in Rule 16b-3(c)(2)(ii) of the Securities Exchange Act
of 1934, as amended (the "1934 Act") may not be amended more than
once ever six (6) months (other than to comport with changes in
the Code, the Employee Retirement Income Security Act or the
rules thereunder), and (c) any amendment to the Plan which is
described in (A), (B) or (C) of Rule 16b-3(b)(2)(ii) of the 1934
Act shall be approved by the shareholders of the Corporation in
the manner described in Section 7(e) hereof. If the Board of
Directors voluntarily submits a proposed modification, amendment,
suspension or termination for shareholder approval, such
submission shall not require any future modifications, amendments
(whether or not relating to the same provision or subject
matter), suspensions or terminations to be similarly submitted
for shareholder approval.
7. General Conditions. (a) Nothing contained in this Plan
or any option granted pursuant to this Plan shall confer upon any
director the right to continue as a director of the Corporation
or interfere in any way with the right of the Corporation to
terminate him as a director.
(b) Corporate action constituting an offer of stock for sale
to any director under the terms of the options to be granted
hereunder shall be deemed complete as of the date when the
actions of the shareholder(s) in electing or reelecting a non-
employee director are completed, regardless of when the option is
actually delivered to the non-employee director or CEO or
acknowledged or agreed to by him.
(c) The term "subsidiary corporation" as used throughout
this Plan shall mean a corporation in which the Corporation owns,
directly or indirectly, shares of stock representing fifty
percent or more of the outstanding voting power of all classes of
stock of such corporation at the time of the granting of an
option under this Plan.
(d) The use of the masculine pronoun shall include the
feminine gender whenever appropriate.
-3-
(e) This Plan was approved by the Board of Directors of the
Corporation on April 9, 1991, and it shall be effective as of
such date. However, if the Plan is not approved by the
Corporation's shareholders who represent a majority of the voting
power, at the next regular meeting of the shareholders of the
Corporation, and if the Plan is not approved by such shareholders
prior to December 31, 1992, it shall automatically terminate and
all options granted hereunder shall be void.
(f) Notwithstanding anything to the contrary in this Plan,
options issued hereunder during calendar year 1991 shall be
issued as of the date of this Plan and not as of May 1.
-4-