S-8

As filed with the Securities and Exchange Commission on March 6, 2007

Registration No. 333-          

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM S-8

REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933

FRIENDLY ICE CREAM CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

Massachusetts	04-2053130
(State or Other Jurisdiction of Incorporation or Organization)	(IRS Employer Identification No.)
1855 Boston Road, Wilbraham, MA	01095
(Address of Principal Executive Offices)	(Zip Code)

Friendly Ice Cream Corporation Key Executive Stock Option Award

(Full Title of the Plan)

Gregory A. Pastore
Vice President, General Counsel and Clerk
Friendly Ice Cream Corporation
1855 Boston Road, Wilbraham, MA 01095
(Name and Address of Agent For Service)

(413) 731-4000

(Telephone Number, Including Area Code, of Agent For Service)

Copies to:
Matthew S. Gilman, Esquire
Brown Rudnick Berlack Israels LLP
One Financial Center
Boston, Massachusetts  02111

CALCULATION OF REGISTRATION FEE

Title Of Each Class Of Securities To Be Registered	Amount To Be Registered(1)	Proposed Maximum Offering Price Per Share(2)	Proposed Maximum Aggregate Offering Price(2)	Amount Of Registration Fee
Common Stock, $.01 par value	75,000 shares	$12.02	$901,500	$27.68
Rights to Purchase Preferred Stock(3)	75,000 rights	—	—	—

(1)Such presently indeterminable number of additional shares of common stock and rights are also registered hereunder as may be issued in the event of a merger, consolidation, reorganization, recapitalization, stock dividend, stock split or other similar change in common stock.

(2)Estimated solely for the purpose of determining the registration fee pursuant to Rule 457(h) under the Securities Act of 1933, as amended, on the basis of the average of the high and low prices for the registrant’s common stock on March 5, 2007, as reported on the American Stock Exchange.

(3)Pursuant to a Rights Agreement entered into on November 19, 1997, one right (each a “Right”) is deemed to be delivered with each share of common stock issued by the registrant. The Rights currently are not separately transferable apart from the common stock, and they are not exercisable until the occurrence of certain events.  Accordingly, no independent value has been attributed to the Rights.

PART I

INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

The documents containing the information specified in this Part I will be sent or given to employees, officers, directors or others as specified by Rule 428(b)(1) under the Securities Act of 1933, as amended (the “Securities Act”). In accordance with the rules and regulations of the Securities and Exchange Commission (the “Commission”) and the instructions to Form S-8, such documents are not being filed with the Commission either as part of this registration statement or as prospectuses or prospectus supplements pursuant to Rule 424 under the Securities Act.

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PART II

INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3.   Incorporation of Documents By Reference.

                    The following documents are incorporated by reference into this registration statement:

(a)       The registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006;

(b)       All other reports filed pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) since the end of the fiscal year covered by the Annual Report referred to in (a) above; and

                 ;                                             (c)       The description of the registrant’s common stock and rights to purchase preferred stock which are contained in the registrant’s registration statements filed pursuant to Section 12 of the Exchange Act and all amendments thereto and reports filed for the purpose of updating such description.

All documents filed by the registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, subsequent to the date hereof and prior to the filing of a post-effective amendment which indicates that all securities offered have been sold or which de-registers all securities then remaining unsold, shall be deemed hereby incorporated by reference in this registration statement and to be a part hereof from the date of filing of such documents.  Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this registration statement to the extent that a statement contained herein or in any subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement.

Item 4.   Description of Securities.

Not applicable.

Item 5.   Interests of Named Experts and Counsel.

Note applicable.

Item 6.   Indemnification of Directors and Officers.

Section 8.51 of the Massachusetts Business Corporation Act, under which the registrant is governed, provides that a corporation may indemnify a director who is a party to a proceeding because he is a director against liability incurred in the proceeding if he conducted himself in good faith and he

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reasonably believed that his conduct was in the best interests of the corporation or that his conduct was at least not opposed to the best interests of the corporation, and, in the case of any criminal proceeding, he had no reasonable cause to believe his conduct was unlawful. Section 8.52 of the Massachusetts Business Corporation Act requires corporations to indemnify any director who was wholly successful in the defense of any proceeding to which he was a party because he was a director of the corporation against reasonable expenses incurred by him in connection with the proceeding.

Section 8.56 of the Massachusetts Business Corporation Act provides that a corporation may indemnify and advance expenses to an officer of the corporation who is a party to a proceeding because he is an officer of the corporation to the same extent as a director, and, if he is an officer but not a director, to such further extent as may be provided by the articles of organization, the bylaws, a resolution of the board of directors or contract, except for liability arising out of acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law. Section 8.56 also provides that an officer of the corporation who is not a director is entitled to mandatory indemnification under Section 8.52, and that the officer may apply to a court for indemnification or an advance for expenses, in each case to the same extent to which a director may be entitled to indemnification or advance under those provisions.

In its Restated Articles of Organization and Amended and Restated By-Laws, the registrant has elected to provide indemnification to its directors and officers in appropriate circumstances. Generally, the Restated Articles of Organization and Amended and Restated By-Laws provide that the registrant shall indemnify directors and officers of the registrant against liabilities and expenses arising out of legal proceedings brought against them by reason of their status as directors or officers of the registrant or by reason of their agreeing to serve, at the request of the registrant, as a director or officer of another organization. Under this provision, a director or officer of the registrant shall be indemnified by the registrant for all expenses, liabilities and losses (including reasonable attorneys’ fees, judgments, fines, “ERISA” excise taxes or penalties), unless he is adjudicated in such proceedings not to have acted in good faith in the reasonable belief that his action was in the best interest of the registrant or, to the extent such matter relates to service with respect to an employee benefit plan, in the best interest of the participants or beneficiaries of such benefit plan.  Any indemnification for amounts paid in settlement of legal proceedings described above shall be made by the registrant unless a court of competent jurisdiction holds that the director or officer did not meet the standard of conduct set forth above or the registrant determines, by clear and convincing evidence, that the director or officer did not meet such standard. Such determination shall be made by the Board of Directors of the registrant, based on advice of independent legal counsel.

The registrant’s Restated Articles or Organization and Amended and Restated By-Laws provide that the registrant shall advance expenses to a director or officer upon receipt of an undertaking by such director or officer to repay such expenses if it is ultimately determined that he is not entitled to indemnification for such expenses. The registrant may, to the extent authorized from time to time by the Board of Directors, grant indemnification rights to employees, agents or other persons serving the registrant.

Section 2.02 of the Massachusetts Business Corporation Act provides that the articles of organization of a corporation may contain a provision eliminating or limiting the personal liability of a director to the corporation for monetary damages for breach of a fiduciary duty as a director notwithstanding any provision of law imposing such liability; provided, however, that such provision shall not eliminate or limit the liability of a director (1) for any breach of the director’s duty of loyalty to the corporation or its shareholders, (2) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (3) for improper distributions under Sections 6.40 of the Massachusetts Business Corporation Act or (4) for any transaction from which the director derived an improper personal benefit. Article 6B of the registrant’s Restated Articles of Organization contains such a provision.

Section 8.57 of the Massachusetts Business Corporation Act also contains provisions authorizing a corporation to obtain insurance on behalf of any director or officer of the corporation against liabilities, whether or not the corporation would have the power to indemnify against such liabilities. The registrant

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maintains directors and officers liability insurance for the benefit of its directors and certain of its officers.

Item 8.   Exhibits.

Exhibit Number		Exhibit Description
	4.1	Restated Articles of Organization of Friendly Ice Cream Corporation (the “Company”) (Incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form S-1, Reg. No. 333-34633).**
	4.2	Amended and Restated By-laws of the Company (Incorporated by reference to Exhibit 3(II) to the Company’s current report on Form 8-K filed September 2, 2003, File No. 001-13579).**
	4.3	Rights Agreement between the Company and The Bank of New York, a Rights Agent (Incorporated by reference to Exhibit 4.3 to the Company’s Registration Statement on Form S-1, Reg. No. 333-34633).**
	5	Legal Opinion of Brown Rudnick Berlack Israels LLP.*
	10.1	Friendly Ice Cream Corporation Key Executive Stock Option Award*
	23.1	Consent of Ernst & Young LLP.*
	23.2	Consent of Brown Rudnick Berlack Israels LLP is included in their legal opinion filed as Exhibit 5 hereof.*
	24	Power of Attorney (included on the signature page of this registration statement).*

* Filed herewith

** Not filed herewith.  In accordance with Rule 411 promulgated pursuant to the Securities Act of 1933, as amended, reference is made to the documents previously filed with the Commission, which are incorporated by reference herein.

Item 9.   Undertakings

(1) The undersigned registrant hereby undertakes:

(A) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i) To include any prospectus required by Section 10(a)(3) of the Securities Act;

(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement;

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(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;

provided, however, that paragraphs (A)(1)(i) and (A)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference into this registration statement.

(B) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(C) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(2) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Wilbraham, Commonwealth of Massachusetts, on the 6th day of March, 2007.

FRIENDLY ICE CREAM CORPORATION
By:	/s/ Paul V. Hoagland
Name: Paul V. Hoagland
Title: Executive Vice President of Administration and Chief Financial Officer

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below constitutes and appoints Gregory A. Pastore and Paul V. Hoagland and each of them (with full power to each of them to act alone), his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments (including post-effective amendments) to this registration statement, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the date indicated.

Name		Title (Capacity)		Date
/s/ George M. Condos	Chief Executive Officer and President		February 28, 2007
George M. Condos	(Principal Executive Officer and Director)
/s/ Paul V. Hoagland	Executive Vice President of Administration
Paul V. Hoagland	and Chief Financial Officer (Principal Financial		February 28, 2007
	and Accounting Officer)
/s/ Donald N. Smith	Chairman of the Board		February 28, 2007
Donald N. Smith
/s/ Steven L. Ezzes	Director		March 1, 2007
Steven L. Ezzes
/s/ Burton J. Manning	Director		February 28, 2007
Burton J. Manning
/s/ Michael J. Daly	Director		February 28, 2007
Michael J. Daly
/s/ Perry D. Odak	Director		February 28, 2007
Perry D. Odak

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INDEX TO EXHIBITS

Exhibit Number		Exhibit Description
	4.1	Restated Articles of Organization of Friendly Ice Cream Corporation (the “Company”) (Incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form S-1, Reg. No. 333-34633).**
	4.2	Amended and Restated By-laws of the Company (Incorporated by reference to Exhibit 3(II) to the Company’s current report on Form 8-K filed September 2, 2003, File No. 001-13579).**
	4.3	Rights Agreement between the Company and The Bank of New York, a Rights Agent (Incorporated by reference to Exhibit 4.3 to the Company’s Registration Statement on Form S-1, Reg. No. 333-34633).**
	5	Legal Opinion of Brown Rudnick Berlack Israels LLP.*
	10.1	Friendly Ice Cream Corporation Key Executive Stock Option Award.*
	23.1	Consent of Ernst & Young LLP.*
	23.2	Consent of Brown Rudnick Berlack Israels LLP is included in their legal opinion filed as Exhibit 5 hereof.*
	24	Power of Attorney (included on the signature page of this registration statement).*

* Filed herewith

** Not filed herewith.  In accordance with Rule 411 promulgated pursuant to the Securities Act of 1933, as amended, reference is made to the documents previously filed with the Commission, which are incorporated by reference herein.

EX-5

EXHIBIT 5

March 6, 2007

Friendly Ice Cream Corporation
1855 Boston Road
Wilbraham, MA 01095

RE: Registration Statement on Form S-8

Ladies and Gentlemen:

We are general counsel to Friendly Ice Cream Corporation, a Massachusetts corporation (the “Company”).  We have been asked to deliver this opinion in connection with the preparation and filing with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “Act”), of a Registration Statement on Form S-8 (the “Registration Statement”) relating to (i) 75,000 shares of the Company’s Common Stock, $.01 par value (the “Shares”) that may be issued pursuant to the Company’s Key Executive Stock Option Award Agreement (the “Key Executive Stock Option Award”); and (ii) 75,000 Rights (as defined below) that will be issued in connection with the issuance of the Shares pursuant to awards granted under the Key Executive Stock Option Award.  The Rights are issuable pursuant to that certain Rights Agreement between the Company and The Bank of New York, as rights agent, entered into as of November 19, 1997 (the “Rights Agreement”), providing, in effect, for the delivery of a right (a “Right”), along with each share of Common Stock issued by the Company.

In connection with this opinion, we have examined and are familiar with originals or copies, certified or otherwise identified to our satisfaction, of the following documents (collectively, the “Documents”):

1.a copy of the Restated Articles of Organization of the Company, as amended, as in effect on the date hereof;

2.a copy of the Amended and Restated Bylaws of the Company as in effect on the date hereof;

3.the corporate records of the Company relating to the proceedings of stockholders and directors of the Company;

4.the Key Executive Stock Option Award;

5.the Rights Agreement;

6.the Registration Statement; and

7.a certificate from the Vice President, General Counsel and Clerk of the Company as to certain matters.

For purposes of this opinion, we have assumed without any investigation: (1) the legal capacity of each natural person; (2) the genuineness of each signature; (3) the completeness of each document

submitted to us as an original and the conformity with the original of each document submitted to us as a copy; and (4) the completeness, accuracy and proper indexing of all governmental records.

We have not, except as specifically noted herein, made any independent review or investigation of orders, judgments, rules or other regulations or decrees by which the Company or any of its property may be bound.  Nor have we made any independent investigation as to the existence of actions, suits, investigations or proceedings, if any, pending or threatened against the Company.

Our opinions contained herein are limited to the laws of the Commonwealth of Massachusetts.

Our opinions hereafter expressed are based solely upon: (1) our review of the Documents; (2) discussions with those of our attorneys who have devoted substantive attention to the matters contained herein; and (3) such review of published sources of law as we have deemed necessary.

Based upon and subject to the foregoing, we are of the opinion that:

(1)the Shares have been duly authorized and, when issued in accordance with the terms of the Key Executive Stock Option Award, will be validly issued, fully paid and nonassessable; and

(2)the Rights have been duly authorized and, when issued in accordance with the terms of the Rights Agreement, will be validly issued, fully paid and nonassessable.

We hereby consent to the filing of this opinion as Exhibit 5 to the Registration Statement and to the reference to our firm wherever it appears in the Registration Statement.

Very truly yours,

/s/ BROWN RUDNICK BERLACK ISRAELS LLP

EX-10.1

Exhibit 10.1

KEY EXECUTIVE STOCK OPTION AWARD AGREEMENT
FRIENDLY ICE CREAM CORPORATION

THIS KEY EXECUTIVE STOCK OPTION AWARD AGREEMENT (the “Agreement”), dated as of the 8th day of January, 2007 (the “Grant Date”) and entered into by and between Friendly Ice Cream Corporation (the “Company”) and GEORGE M. CONDOS (the “Recipient”).

WITNESSETH THAT:

WHEREAS, as an inducement material to the Recipient’s employment as President and Chief Executive Officer of the Company, the Compensation Committee of the Board of Directors has awarded the Recipient an option to purchase shares of the Company’s common stock, par value $0.01 per share (“Stock”), subject to the terms of this Agreement.

NOW, THEREFORE, IT IS AGREED, by and between the Company and the Recipient as follows:

1.             Definitions.  In addition to the other definitions contained herein, the following definitions shall apply:

(a)“Affiliate” shall have the meaning set forth in Rule 12b-2 of the Exchange Act.

(b)“Board” means the Board of Directors of the Company.

(c)“Code” means the Internal Revenue Code of 1986, as amended. A reference to any provision of the Code shall include reference to any successor provision of the Code.

(d)“Committee” means the Compensation Committee of the Board, or such other committee consisting solely of two or more Independent Directors of the Board appointed by the Board to administer the Agreement, or if there is no such committee, the Board.

(e)“Employee” means any person employed by the Company or an Affiliate.  Service as a director or payment of a director’s fee by the Company or an Affiliate shall not be sufficient to constitute “employment” by the Company or an Affiliate.

(f)“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

(g)“Independent Director” means a director who is not an Employee and who qualifies as an Independent Director under the applicable rules of the American

Stock Exchange (and/or the similar rules of any other stock exchange(s) on which the Company’s securities become publicly traded).

(h)“Retirement” shall be deemed to occur upon any termination of service from the Company after the Recipient’s attainment of age 60.

2.             Award and Exercise Price.  Subject to the terms of this Agreement, the Recipient is hereby granted an option (the “Option”) to purchase 75,000 shares of Stock (the “Award”).  The price of each share of Stock subject to the Option shall be $11.80 (the “Exercise Price”).  The Option is not intended to constitute an “incentive stock option” as that term is used in Code Section 422.

3.             Vesting.  Subject to Section 9 hereof, this Option shall become exercisable in accordance with the following schedule provided the Recipient is employed by the Company on the respective date:

Vesting Date	Exercisable for the Number of Shares
January 8, 2008	33.4% of Award
January 8, 2009	33.3% of Award
January 8, 2010	33.3% of Award

Notwithstanding the foregoing provisions of this paragraph 3, this Option may vest and become immediately exercisable if the Recipient’s employment with the Company is terminated by reason of death or disability (as defined in Code Section 22(e)(3) (“Disability”)), as determined by the Committee in its sole discretion.

4.             Expiration; Forfeiture.  This Option shall expire on the earliest to occur of:

(a)the five-year anniversary of the Grant Date;

(b)if the Recipient’s termination of employment with the Company occurs by reason of death or Disability, the one-year anniversary of such Date of Termination;

(c)if the Recipient’s termination of employment with the Company occurs by reason of Retirement, the three-year anniversary of the date of such termination; or

(d)if the Recipient’s termination of employment with the Company occurs for reasons other than death, Disability or Retirement, the three-month anniversary of the date of such termination;

which shall be the “Expiration Date” for the Option.  Notwithstanding the foregoing provisions of this paragraph 4, except as provided in paragraph 3 above, no portion of the Option shall be

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exercisable after the Recipient’s termination of employment with the Company except to the extent that it is exercisable as of the date immediately prior to the date of termination of employment with the Company.

5.             Method of Option Exercise.  Any portion of the Option that is exercisable may be exercised in whole or in part by filing a written notice with the Clerk of the Company at its corporate headquarters, provided that the notice is filed prior to the Expiration Date of the Option.  Such notice shall specify the number of shares of Stock which the Recipient elects to purchase, and shall be accompanied by payment of the Exercise Price for such shares indicated by the Recipient’s election.  Payment shall be by cash.

6.             Withholding.  Pursuant to applicable federal, state, local or foreign laws, the Company may be required to collect income or other taxes on the grant of this Option, the exercise of this Option, the lapse of a restriction placed on this Option or the shares of Stock issued upon exercise of this Option, or at other times.  The Company may require, at such time as it considers appropriate, that the Recipient pay the Company the amount of any taxes which the Company may determine is required to be withheld or collected, and the Recipient shall comply with the requirement or demand of the Company.  In its discretion, the Company may withhold shares of Stock to be issued upon exercise of this Option or offset against any amount owed by the Company to the Recipient, including compensation amounts, if in its sole discretion it deems this to be an appropriate method for withholding or collecting taxes.

7.             Transferability.  This Option is not transferable except as designated by the Recipient by will or by the laws of descent and distribution.

8.             Adjustment of Option.  In the event of any stock dividend, stock split, reverse stock split, extraordinary cash dividend, recapitalization, reorganization, merger, consolidation, split-up, spin-off, combination or exchange of shares or similar corporate transaction, the Committee may adjust the Option to preserve the benefits or potential benefits of the Option. Action by the Committee may include: (i) adjustment of the number and kind of securities which may be delivered under this Agreement; (ii) adjustment of the Exercise Price; and (iii) any other adjustments that the Committee determines to be equitable (which may include, without limitation, (I) replacement of the Option with other awards which the Committee determines have comparable value and which are based on the securities of a company resulting from the transaction, and (II) cancellation of the vested and unvested portion of the Option in return for cash payment of the current value of Option, determined as though the Option is fully vested at the time of payment, provided that the amount of such payment may be the excess of value of the Stock subject to the Option at the time of the transaction over the Exercise Price).  Any such adjustment to an outstanding Option, shall be effected in a manner that precludes the enlargement of Recipient’s rights and benefits under such Option.

9.             Change in Control.  If the Recipient is employed by the Company or an Affiliate at the time of a Change in Control, all outstanding Options subject to this Agreement then held by the Recipient shall become fully exercisable on and after the date of the Change in Control (subject to the expiration provisions otherwise applicable to the Options).  A “Change in Control” shall be deemed to occur on the earliest of the existence of one of the following events:

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(a)(i) any “person” (as such term is used in Sections 13(d) or 14(d) of the Exchange Act), other than one or more Permitted Holders (as defined below), is or becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more than 35% of the total voting power of the Voting Stock (as defined below) of the Company and (ii) the Permitted Holders “beneficially own” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, in the aggregate a lesser percentage of the voting power of the Voting Stock of the Company than such other person and do not have the right or ability by voting power, contract or otherwise to elect or designate for election a majority of the Board of Directors of the Company;

(b)individuals who constitute the Board as of the date hereof (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board, provided that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office is in connection with an actual or threatened “election contest” relating to the election of the directors of the Company; or

(c)approval by the Company’s shareholders of a reorganization, merger or consolidation of the Company, in each case, with respect to which all or substantially all of the individuals and entities who were the respective beneficial owners of the common stock and voting securities of the Company immediately prior to such reorganization, merger or consolidation do not, following such reorganization, merger or consolidation, beneficially own, directly and indirectly, more than 70% of, respectively, the then outstanding shares of common stock or the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such reorganization, merger or consolidation, or of a complete liquidation or dissolution of the Company or of the sale or other disposition of all or substantially all of the assets of the Company.

For purposes of this paragraph 9, the term “Permitted Holders” means Donald N. Smith, the Company’s then existing executive officers and their respective Affiliates.  The term “Voting Stock” of the Company means all classes of capital stock of the Company then outstanding and normally entitled to vote in the election of directors.

10.           Administration.

(a)The authority to control and manage the operation and administration of this Agreement shall be vested in the Committee.  The Committee has the authority and discretion to interpret this Agreement, to establish, amend,

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and rescind any rules and regulations relating to the Agreement, and to make all other determinations that may be necessary or advisable for the administration of the Agreement.  Any interpretation of this Agreement by the Committee and any decision made by it under this Agreement is final and binding on all persons.  In controlling and managing the operation and administration of this Agreement, the Committee shall take action in a manner that conforms to the articles and by-laws of the Company, applicable state corporate law and applicable stock exchange requirements.

(b)Except to the extent prohibited by applicable law or the applicable rules of a stock exchange, the Committee may allocate all or any portion of its responsibilities and powers to any one or more of its members and may delegate all or any part of its responsibilities and powers to any person or persons selected by it.  Any such allocation or delegation may be revoked by the Committee at any time.

(c)The Company and its subsidiaries shall furnish the Committee with such data and information as it determines may be required for it to discharge its duties.  The records of the Company and its subsidiaries as to Recipient’s employment, termination of employment, leave of absence, reemployment and compensation shall be conclusive on all persons unless determined to be incorrect.  Recipient must furnish the Committee such evidence, data or information as the Committee considers desirable to carry out the terms of the Agreement.

11.           General Restrictions.  Notwithstanding any other provision of this Agreement, the Company shall have no obligation or liability to deliver any shares of Stock under this Agreement or make any other distribution of benefits under this Agreement unless such delivery or distribution would comply with all applicable laws (including, without limitation, the requirements of the Securities Act of 1933, as amended), and the applicable requirements of any stock exchange or similar entity.  The Company may also require the Recipient to execute and deliver such other representations and agreements, and take such other action, as may be required by the Company to comply with applicable law.

12.           Limitation of Implied Rights.

(a)Recipient shall not, by reason of this Agreement, acquire any right in or title to any assets, funds or property of the Company or any subsidiary whatsoever, including, without limitation, any specific funds, assets, or other property which the Company or any subsidiary, in its sole discretion, may set aside in anticipation of a liability under the Agreement.  A Recipient shall have only a contractual right to the Stock issuable upon exercise of the Option in accordance with this Agreement, unsecured by any assets of the Company or any subsidiary, and nothing contained in this

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Agreement shall constitute a guarantee that the assets of the Company or any Subsidiary shall be sufficient to pay any benefits to any person.

(b)This Agreement does not constitute a contract of employment, and the Award granted to Recipient pursuant to this Agreement does not give the Recipient the right to be retained in the employ of the Company or any subsidiary, nor any right or claim to any benefit under this Agreement, unless such right or claim has specifically accrued under the terms of this Agreement.  Except as otherwise provided in this Agreement, the Award does not confer upon the Recipient any rights as a shareholder of the Company prior to the date on which the individual fulfills all conditions for receipt of such rights and is issued shares.

13.           Amendment.  This Agreement may only be modified or amended by a writing signed by both parties.

14.           Notices.  Any notices required to be given under this Agreement shall be sufficient if in writing and if hand-delivered or if sent by first class mail and addressed as follows:

if to the Company:

Friendly Ice Cream Corporation
1855 Boston Road
Wilbraham, MA  01095
Attn:  Vice President, Human Resources

if to the Recipient:

George M. Condos
299 Great Bay Street
East Falmouth, MA  02536

or to such other address as either party may designate under the provisions hereof.

15.           Successors and Assigns.  The rights and obligations of the Company under this Agreement shall inure to the benefit of and be binding upon the successors and assigns of the Company.

16.           Entire Agreement.   This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and supersedes in their entirety all prior undertakings and agreements of the Company and Recipient with respect to the subject matter hereof including, without limitation, the offer letter and employment agreement.

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17.           Governing Law.  The terms of this Agreement shall be governed by and interpreted in accordance with the laws of the Commonwealth of Massachusetts.

IN WITNESS WHEREOF, the Recipient has hereunto set his hand, and the Company has caused these presents to be executed in its name and on its behalf, all as of the Grant Date.

RECIPIENT
/s/ George M. Condos
GEORGE M. CONDOS
FRIENDLY ICE CREAM CORPORATION
By	/s/ Garrett J. Ulrich
	GARRETT J. ULRICH,
	VICE PRESIDENT, HUMAN RESOURCES

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EX-23.1

EXHIBIT 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in the Registration Statement (Form S-8) pertaining to the Friendly Ice Cream Corporation Key Executive Stock Option Award, of our reports dated February 21, 2007, with respect to the consolidated financial statements and schedule of Friendly Ice Cream Corporation, Friendly Ice Cream Corporation management’s assessment of the effectiveness of internal control over financial reporting, and the effectiveness of internal control over financial reporting of Friendly Ice Cream Corporation included in its Annual Report (Form 10-K) for the year ended December 31, 2006, filed with the Securities and Exchange Commission.

/s/ ERNST & YOUNG LLP

Boston, Massachusetts
March 5, 2007