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EXHIBIT 10.11
ANNEX A
RAINFOREST CAFE, INC.
1997 DIRECTOR STOCK OPTION PLAN
1. PURPOSE. The purpose of the Rainforest Cafe, Inc. 1997 Director Stock
Option Plan (the "Plan") is to advance the interests of Rainforest Cafe, Inc.
(the "Company") and its shareholders by encouraging share ownership by members
of the Board of Directors of the Company (the "Board") who are not employees of
the Company or any of its subsidiaries, in order to promote long-term
shareholder value through continuing ownership of the Company's common stock.
2. ADMINISTRATION. The plan shall be administered by the Board. The
Board shall have all the powers vested in it by the terms of the Plan, such
powers to include authority (within the limitations described herein) to
prescribe the form of the agreement embodying awards of nonqualified stock
options made under the Plan ("Options"). The Board shall, subject to the
provisions of the Plan, grant Options under the Plan and shall have the power
to construe the Plan, to determine all questions arising thereunder and to
adopt and amend such rules and regulations for the administration of the Plan
as it may deem desirable. Any decisions of the Board in the administration of
the Plan, as described herein, shall be final and conclusive. The Board may
act only by a majority of its members in office, except that the members
thereof may authorize any one or more of their number or any other officer of
the Company to execute and deliver documents on behalf of the Board. No member
of the Board shall be liable for anything done or omitted to be done by him or
by any other member of the Board in connection with the Plan, except for his
own willful misconduct or as expressly provided by statute.
3. PARTICIPATION. Each member of the Board who is not an employee of the
Company or any of its subsidiaries (a "Non-Employee Director") shall be
eligible to receive an Option in accordance with Paragraph 5 below.
4. AWARDS UNDER THE PLAN.
(a) Awards under the Plan shall include only Options, which are
rights to purchase common stock of the Company having no par value (the "Common
Stock"). Such Options are subject to the terms, conditions and restrictions
specified in Paragraph 5 below.
(b) There may be issued under the Plan pursuant to the exercise of
Options an aggregate of not more than 200,000 shares of Common Stock, subject
to adjustment as provided in Paragraph 6 below. If any Option is canceled,
terminates or expires unexercised, in whole or in part, any shares of Common
Stock that would otherwise have been issuable pursuant thereto will be
available for issuance under new Options.
(c) A Non-Employee Director to whom an Option is granted (and any person
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succeeding to such a Non-Employee Director's rights pursuant to the Plan) shall
have no rights as a shareholder with respect to any Common Stock issuable
pursuant to any such Option until the date of the issuance of a stock
certificate to him for such shares. Except as provided in Paragraph 6 below,
no adjustment shall be made for dividends, distributions or other rights
(whether ordinary or extraordinary, and whether in cash, securities or other
property) for which the record date is prior to the date such stock certificate
is issued.
5. NONQUALIFIED STOCK OPTIONS. Each Option granted under the Plan shall
be evidenced by an agreement in such form as the Board shall prescribe from
time to time in accordance with the Plan and shall comply with the following
terms and conditions:
(a) The Option exercise price shall be the "Fair Market Value" (as
herein defined) of the Common Stock subject to such Option on the date the
Option is granted. Fair Market Value shall be the closing sales price of a
share of Common Stock on the date of grant as reported on the Nasdaq National
Market or, if the Nasdaq National Market is closed on that date, on the last
preceding date on which the Nasdaq National Market was open for trading, but in
no event will such Option exercise price be less than the par value of the
Common Stock.
(b) The Board shall determine the number of shares of Common Stock
subject to each Option granted to Non-Employee Directors and, subject to
Section 5(d) hereof, the vesting schedule of each such Option. Notwithstanding
the foregoing, once such Options become outstanding, a Non-Employee Director
will still be entitled to the anti-dilution adjustments provided for in Section
6 hereof.
(c) The Option shall not be transferable by the optionee otherwise
than by will or the laws of descent and distribution, and shall be exercisable
during his lifetime only by him.
(d) Options shall not be exercisable:
(i) except pursuant to the vesting schedule established
by the Board of Directors and after the expiration of
ten years from the date it is granted.
Notwithstanding anything to the contrary herein, an
Option shall automatically become immediately
exercisable in full: (i) upon the removal of the
Non-Employee Director from the Board without cause;
or (ii) in the event of a "change in control" of the
Company, as defined in any existing agreements
between the Company and its senior officers.
(ii) unless payment in full is made for the shares of
Common Stock being acquired thereunder at the time of
exercise, such payment shall be made in United States
dollars by cash or check, or in lieu thereof, by
tendering to the Company Common Stock owned by the
person exercising the Option and having a Fair Market
Value equal to the cash exercise price applicable to
such Option, or by a combination of United States
dollars
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and Common Stock as aforesaid; and
(iii) unless the person exercising the Option has been at
all times during the period beginning with the date
of grant of the Option and ending on the date of such
exercise, a Non-Employee Director of the Company,
except that
(A) if such person shall cease to be such a Non-
Employee Director for reasons other than death, while
holding an Option that has not expired and has not been
fully exercised, such person may, at any time within three
years of the date he ceased to be a Non-Employee
Director (but in no event after the Option has expired
under the provisions of subparagraph 5(d)(i) above),
exercise the Option with respect to any Common Stock as to
which he could have exercised on the date he ceased to be
such a Non-Employee Director; or
(B) if any person to whom an Option has been granted
shall die holding an Option that has not expired and has
not been fully exercised, his executors, administrators,
heirs or distributees, as the case may be, may, at
any time within one year after the date of such death (but
in no event after the Option has expired under the
provisions of subparagraph 5(d)(i) above), exercise the
Option with respect to any shares subject to the Option.
6. DILUTION AND OTHER ADJUSTMENTS. In the event of any change in the
outstanding Common Stock of the Company by reason of any stock split, stock
dividend, split-up, split-off, spin-off, recapitalization, merger,
consolidation, rights offering, reorganization, combination or exchange of
shares, a sale by the Company of substantially all of its assets, any
distribution to shareholders other than a normal cash dividend, or other
extraordinary or unusual event, the number or kind of shares that may be issued
under the Plan pursuant to subparagraph 4(b) above, and the number or kind of
shares subject to, and the Option price per share under, all outstanding
Options shall be automatically adjusted so that the proportionate interest of
the participant shall be maintained as before the occurrence of such event;
such adjustment in outstanding Options shall be made without change in the
total Option exercise price applicable to the unexercised portion of such
Options and with a corresponding adjustment in the Option exercise price per
share, and such adjustment shall be conclusive and binding for all purposes of
the Plan.
7. IMMEDIATE ACCELERATION OF OPTIONS. Notwithstanding any provision in
the Plan, all outstanding Options will become exercisable immediately if any of
the following events occur:
(1) any person or group of persons becomes the beneficial owner of
30% or more of any equity security of the Company entitled to vote for the
election of directors;
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(2) a majority of the members of the Board of Directors of the
Company is replaced within the period of less than two years by directors not
nominated and approved by the Board of Directors; or
(3) the shareholders of the Company approve an agreement to merge
or consolidate with or into another corporation or an agreement to sell or
otherwise dispose of all or substantially all of the Company's assets
(including a plan of liquidation).
For purposes of this Section 7, beneficial ownership by a person or group
of persons shall be determined in accordance with Regulation 13D (or any
similar successor regulation) promulgated by the Securities and Exchange
Commission pursuant to the 1934 Act. Beneficial ownership of more than 30% of
an equity security may be established by any reasonable method, but shall be
presumed conclusively as to any person who files a Schedule 13D report with the
Securities and Exchange Commission reporting such ownership. If the
restrictions and forfeitability periods are eliminated by reason of provision
(1), the limitations of this Plan shall not become applicable again should the
person cease to own 30% or more of any equity security of the Company.
8. MISCELLANEOUS PROVISIONS.
(a) Except as expressly provided for in the Plan, no Non-Employee
Director or other person shall have any claim or right to be granted an Option
under the Plan. Neither the Plan nor any action taken hereunder shall be
construed as giving any Non-Employee Director any right to be retained in the
service of the Company.
(b) A participant's rights and interest under the Plan may not be
assigned or transferred, hypothecated or encumbered in whole or in part either
directly or by operation of law or otherwise (except in the event of a
participant's death, by will or the laws of descent and distribution),
including, but not by way of limitation, execution, levy, garnishment,
attachment, pledge, bankruptcy or in any other manner, and no such right or
interest of any participant in the Plan shall be subject to any obligation or
liability of such participant.
(c) Common Stock shall not be issued hereunder unless counsel for
the Company shall be satisfied that such issuance will be in compliance with
applicable federal, state, local and foreign securities, securities exchange
and other applicable laws and requirements.
(d) It shall be a condition to the obligation of the Company to
issue Common Stock upon exercise of an Option, that the participant (or any
beneficiary or person entitled to act under subparagraph 5(d)(iii)(B) above)
pay to the Company, upon its demand, such amount as may be requested by the
Company for the purpose of satisfying any liability to withhold federal, state,
local or foreign income or other taxes. If the amount requested is not paid,
the Company may refuse to issue such Common Stock.
(e) The expenses of the Plan shall be borne by the Company.
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(f) By accepting any Option or other benefit under the Plan, each
participant and each person claiming under or through him shall be conclusively
deemed to have indicated his acceptance and ratification of, and consent to,
any action taken under the Plan by the Company or the Board.
(g) The appropriate officers of the Company shall cause to be
filed any reports, returns or other information regarding Options hereunder or
any Common Stock issued pursuant hereto as may be required by Section 13 or
15(d) of the Securities Exchange Act of 1934, as amended, or any other
applicable statute, rule or regulation.
9. AMENDMENT OR DISCONTINUANCE. The Plan may be amended at any time
and from time to time by the Board as the Board shall deem advisable; provided,
however, that no amendment shall become effective without shareholder approval
if such shareholder approval is required by law, rule or regulation, and in no
event shall the Plan be amended more than once every six months, other than to
comport with changes in the Internal Revenue Code of 1986, as amended, the
Employee Retirement Income Security Act or the rules thereunder. No amendment
of the Plan shall materially and adversely affect any right of any participant
with respect to any Option theretofore granted without such participant's
written consent.
10. TERMINATION. This Plan shall terminate upon the earlier of the
following dates or events to occur upon the adoption of a resolution of the
Board terminating the Plan or ten years from the date the Plan is initially
approved and adopted by the shareholders of the Company. No termination of the
Plan shall materially and adversely affect any of the rights or obligations of
any person, without his consent, under any Option theretofore granted under the
Plan.
11. EFFECTIVE DATE OF PLAN. The Plan will become effective on the
date that it is approved by the affirmative vote of the holders of the greater
of (a) a majority of the outstanding shares of Common Stock of the Company
present and entitled to vote or (b) a majority of the voting power of the
minimum number of shares entitled to vote that would constitute a quorum for
transaction of business at the Company's Annual Meeting of Shareholders.