-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IdZjS/8J0Rra/t5rw+odMaZ55ibl2/Dv0M6zLTc9YRQoHAtZ6Yd/2k2pH69BqLSo K2s4wdxwhUsNZhjJ8MSYWw== 0000892569-05-000471.txt : 20050630 0000892569-05-000471.hdr.sgml : 20050630 20050630171055 ACCESSION NUMBER: 0000892569-05-000471 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 7 CONFORMED PERIOD OF REPORT: 20050628 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050630 DATE AS OF CHANGE: 20050630 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CKE RESTAURANTS INC CENTRAL INDEX KEY: 0000919628 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-EATING PLACES [5812] IRS NUMBER: 330602639 STATE OF INCORPORATION: DE FISCAL YEAR END: 0125 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-11313 FILM NUMBER: 05929367 BUSINESS ADDRESS: STREET 1: 6307 CARPINTERIA AVENUE STREET 2: SUITE A CITY: CARPINTERIA STATE: CA ZIP: 93013 BUSINESS PHONE: (805)898-8408 MAIL ADDRESS: STREET 1: 6307 CARPINTERIA AVENUE STREET 2: SUITE A CITY: CARPINTERIA STATE: CA ZIP: 93013 8-K 1 a10398e8vk.htm FORM 8-K e8vk
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)     June 28, 2005

CKE RESTAURANTS, INC.

 
(Exact name of registrant as specified in its charter)
         
Delaware   1-11313   33-0602639
         
(State or other jurisdiction
of incorporation) 		  (Commission File Number)   (IRS Employer Identification No.)
     
6307 Carpinteria Ave., Ste. A, Carpinteria, California   93013
     
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code:     (805) 745-7500

 

 
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
o   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
o   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
o   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 
 

 

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Item 1.01 Entry into a Material Definitive Agreement.
Item 9.01 Financial Statements and Exhibits.
SIGNATURE
EXHIBIT INDEX
EXHIBIT 10.2
EXHIBIT 10.3
EXHIBIT 10.4
EXHIBIT 10.5
EXHIBIT 10.6
EXHIBIT 10.8

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Item 1.01 Entry into a Material Definitive Agreement.

     (a) 2005 Omnibus Incentive Compensation Plan

     On June 28, 2005, at the Annual Meeting of Stockholders, the stockholders of CKE Restaurants, Inc. (the “Company”), approved the CKE Restaurants, Inc. 2005 Omnibus Incentive Compensation Plan (the “2005 Plan”). The purpose of the 2005 Plan is to: (i) further align the interests of employees and directors with those of the stockholders of the Company by providing incentive compensation opportunities tied to the performance of the common stock of the Company and by promoting increased ownership of the common stock of the Company by such individuals; and (ii) advance the interests of the Company and its stockholders by attracting, retaining and motivating key personnel.

     The 2005 Plan includes the following equity compensation awards: (i) incentive stock options; (ii) non-qualified stock options; (iii) restricted stock awards; (iv) unrestricted stock awards; (v) stock appreciation rights; and (vi) stock units. Participants in the 2005 Plan may be granted any one of the above equity awards or any combination thereof, as determined by the Board of Directors. Under the 2005 Plan, the Company may issue and sell a maximum of 2,500,000 shares of common stock under all restricted and unrestricted awards granted by the Company.

     The 2005 Plan will be administered by a committee comprised of no fewer than two members of the Board of Directors (the “Committee”). Subject to the express limitations of the 2005 Plan, the Committee will have the authority to determine the persons to whom, and the time or times at which, awards may be granted, the number of shares, units or other rights subject to each award, the exercise, base or purchase price of an award (if any), the time or times at which an award will become vested, exercisable or payable, the performance goals and other conditions of an award, the duration of the award and all other terms of the award. The Committee may prescribe, amend and rescind rules and regulations relating to the 2005 Plan. In addition, the Committee may delegate to one or more officers of the Company the ability to grant awards and to determine the terms and conditions of awards to certain employees, and the Committee may delegate to any appropriate officer or employee of the Company responsibility for performing certain ministerial functions under the 2005 Plan. Any person who is an employee of the Company or any affiliate thereof, any person to whom an offer of employment with the Company has been extended, or any person who is a non-employee director of the Company is eligible to be designated by the Committee to receive awards and become a participant under the 2005 Plan.

     The Committee may specify that the attainment of certain performance measures will determine the degree of granting, vesting and payout with respect to equity compensation awards that the Committee intends to qualify as performance based awards under Section 162(m) of the Internal Revenue Code. The Committee will choose the performance goals for the grant of such equity compensation awards from among the following performance measures: (i) earnings per share; (ii) economic value created; (iii) market share; (iv) net income; (v) operating income; (vi) adjusted net income after capital charge; (vii) return on assets; (viii) return on capital; (ix) return on equity; (x) return on investment; (xi) cash flow; (xii) operating margin; (xiii) share price; (xiv) share price growth; (xv) total stockholder return; and (xvi) strategic business criteria. Equity compensation awards that are not intended to qualify as performance based awards may be based on the above performance measures or such other performance measures as the Committee may determine.

     The 2005 Plan will terminate on March 22, 2015, the tenth anniversary of the date of its adoption by the Board of Directors. However, the Board of Directors may, in its discretion, terminate the 2005 Plan at an earlier date.

     The foregoing description of the 2005 Plan is qualified in its entirety by reference to the full text of the 2005 Plan, which is filed as Exhibit 10.1 to this Current Report on Form 8-K (incorporating by reference therein Annex A to the Company’s Definitive Proxy Statement on Schedule 14A filed with the Securities and Exchange Commission (the “SEC”) on May 20, 2005). A form of Stock Option Agreement, a form of Restricted Stock Award Agreement, a form of Stock Appreciation Rights Award Agreement, a form of Restricted Stock Unit Award

 

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Agreement and a form of Stock Award Agreement used under the 2005 Plan are attached hereto as Exhibits 10.2, 10.3, 10.4, 10.5 and 10.6, respectively, and are hereby incorporated by reference.

     (b) Amendment to 1994 Employee Stock Purchase Plan

     On June 28, 2005, at the Annual Meeting of Stockholders, the stockholders of the Company approved an amendment to the CKE Restaurants, Inc. 1994 Employee Stock Purchase Plan (the “ESPP”). Under the ESPP, eligible employees of the Company may purchase shares of common stock of the Company on certain beneficial terms. The amendment increases the number of shares reserved for issuance under the ESPP by 1,000,500, bringing the total number of shares issuable thereunder to 3,907,500.

     The foregoing summary of the amendment to the ESPP is qualified in its entirety by reference to the full text of the ESPP, as amended, which is filed as Exhibit 10.7 to this Current Report on Form 8-K (incorporating by reference therein Annex B to the Company’s Definitive Proxy Statement on Schedule 14A filed with the SEC on May 20, 2005).

     (c) Deferred Compensation Plan

     On June 28, 2005, the Board of Directors approved the CKE Restaurants, Inc. Deferred Compensation Plan (the “Plan”). The purpose of the Plan is to: (i) provide a capital accumulation opportunity to a select group comprised of management, highly compensated employees and non-employee directors of the Company by deferring compensation on a pre-tax basis; and (ii) attract and retain key employees and directors.

     The Plan will be administered by a committee appointed by the Board of Directors (the “Plan Committee”). The initial Plan Committee will be the compensation committee of the Board of Directors. Subject to the express limitations of the Plan, the Plan Committee will have the authority to make, amend, interpret and enforce all rules and regulations for the administration of the Plan and will decide or resolve all questions that may arise in the administration of the Plan, including, without limitation, interpretations of the Plan. Only a select group comprised of management, highly compensated employees and non-employee directors may participate in the Plan.

     Under the Plan, participants may elect to defer, on a pre-tax basis, a portion of their base salary (in an amount not to exceed eighty percent (80%)), quarterly or annual bonus (in an amount not to exceed one hundred percent (100%)), or, in the case of non-employee directors, annual stipend and meeting fees (in an amount not to exceed one hundred percent (100%)). Any amounts deferred by a participant will be credited to such participant’s deferred compensation account, a bookkeeping device utilized solely for the purpose of determining the benefits payable to a participant under the Plan. The Plan further states that the Company may make discretionary contributions to a plan participant’s deferred compensation account. Each plan participant will be vested in the amounts held in such plan participant’s deferred compensation account as follows: (i) one hundred percent (100%) vested at all times with respect to all amounts of deferred compensation; and (ii) vested as determined by the Board of Directors and the compensation committee of the Board of Directors with respect to all discretionary contributions made by the Company.

     The Plan provides that any amounts deferred under the Plan may not be distributed to a plan participant earlier than: (i) the plan participant’s separation from service with the Company; (ii) the plan participant’s retirement from the Company; (iii) the plan participant’s disability; (iv) the plan participant’s death; (v) the occurrence of a change in control; (vi) the occurrence of an unforeseeable emergency; or (vii) such other date as set forth in the plan participant’s deferral election, including a date that occurs prior to the plan participant’s separation from service with the Company. Any amounts distributed to a plan participant will be paid in a form specified by the plan participant, or in the form of either a lump sum payment in an amount equal to the plan participant’s deferred compensation account balance or equal annual installments of the plan participant’s deferred compensation account balance over a period not to exceed (i) fifteen (15) years in the case of a distribution on or after a plan participant’s attainment of the Normal Retirement Age set forth in the Plan or (ii) five (5) years in all other cases.

     The Board of Directors may partially or completely terminate the Plan at any time if, in its discretion, the Board of Directors determines that the continuance of the Plan would not be in the best interests of the Company.

 

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     The foregoing description of the Plan is qualified in its entirety by reference to the full text of the Plan, which is filed as Exhibit 10.8 to this Current Report on Form 8-K.

Item 9.01 Financial Statements and Exhibits.

(c)   Exhibits

       
 
Exhibit 10.1
  2005 Omnibus Incentive Compensation Plan (incorporated by reference to Annex A of the Company’s Definitive Proxy Statement on Schedule 14A filed May 20, 2005).
 
 
    
 
Exhibit 10.2
  Form of Stock Option Agreement under the 2005 Omnibus Incentive Compensation Plan.
 
 
    
 
Exhibit 10.3
  Form of Restricted Stock Award Agreement under the 2005 Omnibus Incentive Compensation Plan.
 
 
    
 
Exhibit 10.4
  Form of Stock Appreciation Rights Award Agreement under the 2005 Omnibus Incentive Compensation Plan.
 
 
    
 
Exhibit 10.5
  Form of Restricted Stock Unit Award Agreement under the 2005 Omnibus Incentive Compensation Plan.
 
 
    
 
Exhibit 10.6
  Form of Stock Award Agreement under the 2005 Omnibus Incentive Compensation Plan.
 
 
    
 
Exhibit 10.7
  1994 Employee Stock Purchase Plan, as amended (incorporated by reference to Annex B of the Company’s Definitive Proxy Statement on Schedule 14A filed May 20, 2005).
 
 
    
 
Exhibit 10.8
  Deferred Compensation Plan.

 

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SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
         
  CKE RESTAURANTS, INC.
 		  
Date: June 28, 2005  /s/ Theodore Abajian    
  Theodore Abajian   
  Executive Vice President and Chief Financial Officer   

 

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EXHIBIT INDEX

     
Exhibit No.   Description
10.1
  2005 Omnibus Incentive Compensation Plan (incorporated by reference to Annex A of the Company’s Definitive Proxy Statement on Schedule 14A filed May 20, 2005).
 
    
10.2
  Form of Stock Option Agreement under the 2005 Omnibus Incentive Compensation Plan.
 
    
10.3
  Form of Restricted Stock Award Agreement under the 2005 Omnibus Incentive Compensation Plan.
 
    
10.4
  Form of Stock Appreciation Rights Award Agreement under the 2005 Omnibus Incentive Compensation Plan.
 
    
10.5
  Form of Restricted Stock Unit Award Agreement under the 2005 Omnibus Incentive Compensation Plan.
 
    
10.6
  Form of Stock Award Agreement under the 2005 Omnibus Incentive Compensation Plan.
 
    
10.7
  1994 Employee Stock Purchase Plan, as amended (incorporated by reference to Annex B of the Company’s Definitive Proxy Statement on Schedule 14A filed May 20, 2005).
 
    
10.8
  Deferred Compensation Plan.

 

EX-10.2 2 a10398exv10w2.txt EXHIBIT 10.2 EXHIBIT 10.2 FORM OF CKE RESTAURANTS, INC. STOCK OPTION AGREEMENT TYPE OF OPTION (CHECK ONE): [ ] INCENTIVE [ ] NONQUALIFIED This Stock Option Agreement (the "Agreement") is entered into as of ____________, by and between CKE Restaurants, Inc., a Delaware corporation (the "Company"), and ____________________________________ (the "Optionee") pursuant to the Company's 2005 Omnibus Incentive Compensation Plan (the "Plan"). Any capitalized term not defined herein shall have the same meaning ascribed to it in the Plan. 1. GRANT OF OPTION. The Company hereby grants to Optionee an option (the "Option") to purchase all or any portion of a total of ________________________ (_______) shares (the "Shares") of the Common Stock of the Company at a purchase price of ________________________ ($_____) per share (the "Exercise Price"), subject to the terms and conditions set forth herein and the provisions of the Plan. If the box marked "Incentive" above is checked, then this Option is intended to qualify as an "incentive stock option" as defined in Section 422 of the Internal Revenue Code of l986, as amended (the "Code"). If this Option fails in whole or in part to qualify as an incentive stock option, or if the box marked "Nonqualified" is checked, then this Option shall to that extent constitute a nonqualified stock option. 2. VESTING OF OPTION. The right to exercise this Option shall vest in installments, and this Option shall be exercisable from time to time in whole or in part as to any vested installment ("Vested Shares"). [INSERT VESTING SCHEDULE, EITHER TIME-BASED OR PERFORMANCE-BASED] such that 100% of the Shares shall become Vested Shares on the third anniversary of the "Vesting Commencement Date." For these purposes, the Vesting Commencement Date shall be _______________. No additional Shares shall vest after the date of termination of Optionee's "Continuous Service" (as defined below), but this Option shall continue to be exercisable in accordance with Section 3 hereof with respect to that number of shares that have vested as of the date of termination of Optionee's Continuous Service. For purposes of this Agreement, the term "Continuous Service" means (i) employment by either the Company or any parent or subsidiary corporation of the Company, or by a corporation or a parent or subsidiary of a corporation issuing or assuming a stock option in a transaction to which Section 424(a) of the Code applies, which is uninterrupted except for vacations, illness (except for permanent disability, as defined in Section 22(e)(3) of the Code), or leaves of absence which are approved in writing by the Company or any of such other employer corporations, if applicable, (ii) service as a member of the Board of Directors of the Company until Optionee resigns, is removed from office, or Optionee's term of office expires and he or she is not reelected, or (iii) so long as Optionee is engaged as a Consultant or other Service Provider. 3. TERM OF OPTION. The right of the Optionee to exercise this Option shall terminate upon the first to occur of the following: (a) the expiration of ten (10) years from the date of this Agreement; (b) the expiration of twelve (12) months from the date of termination of Optionee's Continuous Service if such termination is due to Disability of the Optionee (as defined in Section 409A(a)(2)(C) of the Code); (c) the expiration of eighteen (18) months from the date of termination of Optionee's Continuous Service if such termination is due to Optionee's death; (d) the expiration of eighteen (18) months from the date of termination of Optionee's Continuous Service if such termination occurred at a time when Optionee is eligible to elect immediate commencement of retirement benefits at a specified retirement age under a pension plan to which the Company or any of its Affiliates had made contributions; (e) the expiration of three (3) months from the date of termination of Optionee's Continuous Service if such termination occurs for any reason other than those listed above; or (f) upon the consummation of a "Change in Control" (as defined in Section 11.2(b) of the Plan), unless otherwise provided pursuant to Section 8 below. 4. EXERCISE OF OPTION. On or after the vesting of any portion of this Option in accordance with Sections 2 or 8 hereof, and until termination of the right to exercise this Option in accordance with Section 3 above, the portion of this Option that has vested may be exercised in whole or in part by the Optionee (or, after his or her death, by the person designated in Section 5 below) upon delivery of the following to the Company at its principal executive offices: (a) a written notice of exercise which identifies this Agreement and states the number of Shares then being purchased (but no fractional Shares may be purchased), with any partial exercise being deemed to cover first vested Shares and then the earliest vesting installments of unvested Shares; (b) a check or cash in the amount of the Exercise Price (or payment of the Exercise Price in such other form of lawful consideration as the Administrator may approve from time to time under the provisions of Section 6.6 of the Plan); (c) a check or cash in the amount reasonably requested by the Company to satisfy the Company's withholding obligations under federal, state or other applicable tax laws with respect to the taxable income, if any, recognized by the Optionee in connection with the exercise of this Option (unless the Company and Optionee shall have made other arrangements for deductions or withholding from Optionee's wages, bonus or other compensation payable to Optionee, or by the withholding of Shares issuable upon exercise of this Option or the delivery of Shares owned by the Optionee in accordance with Section 6.6 of the Plan, provided such arrangements satisfy the requirements of applicable tax laws); and (d) a letter, if requested by the Company, in such form and substance as the Company may require, setting forth the investment intent of the Optionee, or person designated in Section 5 below, as the case may be. 2 5. LIMITED TRANSFERABILITY; DEATH OF OPTIONEE. Except as provided in Section 6.7 of the Plan, the rights of the Optionee under this Agreement may not be assigned or transferred except by will or by the laws of descent and distribution, and may be exercised during the lifetime of the Optionee only by such Optionee. Any attempt to sell, pledge, assign, hypothecate, transfer or dispose of this Option in contravention of this Agreement or the Plan shall be void and shall have no effect. If the Optionee's Continuous Service terminates as a result of his or her death, and provided Optionee's rights hereunder shall have vested pursuant to Section 2 hereof, Optionee's legal representative, his or her legatee, or the person who acquired the right to exercise this Option by reason of the death of the Optionee (individually, a "Successor") shall succeed to the Optionee's rights and obligations under this Agreement. After the death of the Optionee, only a Successor may exercise this Option. 6. RECEIPT OF PLAN. Optionee acknowledges receipt of a copy of the Plan and understands that all rights and obligations connected with this Option are set forth in this Agreement and in the Plan. 7. ADJUSTMENTS UPON CHANGES IN CAPITAL STRUCTURE. In the event that the outstanding shares of Common Stock of the Company are hereafter increased or decreased or changed into or exchanged for a different number or kind of shares or other securities of the Company by reason of a recapitalization, stock split, combination of shares, reclassification, stock dividend or other change in the capital structure of the Company, then appropriate adjustment shall be made by the Administrator to the number of Shares subject to the unexercised portion of this Option and to the Exercise Price per share, in order to preserve, as nearly as practical, but not to increase, the benefits of the Optionee under this Option, in accordance with the provisions of Section 4.3 of the Plan. 8. CHANGE IN CONTROL. In the event of a Change in Control (as defined in Section 11.2(b) of the Plan): (a) The right to exercise this Option shall accelerate automatically and vest in full (notwithstanding the provisions of Section 2 above) effective as of immediately prior to the occurrence of a Triggering Event (as defined below) occurring within the twelve (12) month period beginning with the Change in Control. (b) For purposes of this Section 8, the following terms shall have the meanings set forth below: (i) "Triggering Event" shall mean (i) the termination of Continuous Service of Optionee by the Company or an Affiliate (or any successor thereof) other than on account of death, Disability or Cause, (ii) the occurrence of a Constructive Termination or (iii) any failure by the Company (or a successor entity) to assume, replace, convert or otherwise continue this Option in connection with the Change in Control (or another corporate transaction or other change effecting the Common Stock) on the same terms and conditions as applied immediately prior to such transaction, except for equitable adjustments to reflect changes in the Common Stock pursuant to Section 7 hereof and Section 4.3 of the Plan. 3 (ii) "Cause" shall mean a determination by the Committee that Optionee (i) has been convicted of, or entered a plea of nolo contendere to, a crime that constitutes a felony under Federal or state law, (ii) has engaged in willful gross misconduct in the performance of the Optionee's duties to the Company or an Affiliate or (iii) has committed a material breach of any written agreement with the Company or any Affiliate with respect to confidentiality, noncompetition, nonsolicitation or similar restrictive covenant. In the event that the Optionee is a party to an employment agreement with the Company or any Affiliate that defines a termination on account of "Cause" (or a term having similar meaning), such definition shall apply as the definition of a termination on account of "Cause" for purposes hereof, but only to the extent that such definition provides the Optionee with greater rights. A termination on account of Cause shall be communicated by written notice to the Optionee, and shall be deemed to occur on the date such notice is delivered to the Optionee. (iii) "Constructive Termination" shall mean a termination of employment by Optionee within sixty (60) days following the occurrence of any one or more of the following events without the Optionee's written consent (i) any reduction in position, title (for Vice Presidents or above), overall responsibilities, level of authority, level of reporting (for Vice Presidents or above), base compensation, annual incentive compensation opportunity, aggregate employee benefits or (ii) a request that Optionee's location of employment be relocated by more than fifty (50) miles. In the event that the Optionee is a party to an employment agreement with the Company or any Affiliate (or a successor entity) that defines a termination on account of "Constructive Termination," "Good Reason" or "Breach of Agreement" (or a term having a similar meaning), such definition shall apply as the definition of "Constructive Termination" for purposes hereof in lieu of the foregoing, but only to the extent that such definition provides the Optionee with greater rights. A Constructive Termination shall be communicated by written notice to the Committee, and shall be deemed to occur on the date such notice is delivered to the Committee, unless the circumstances giving rise to the Constructive Termination are cured within five (5) days of such notice. 9. NO EMPLOYMENT CONTRACT CREATED. Neither the granting of this Option nor the exercise hereof shall be construed as granting to the Optionee any right with respect to continuance of employment by the Company or any Affiliate (or a successor entity). The right of the Company or any Affiliate (or successor entity) to terminate at will the Optionee's employment at any time (whether by dismissal, discharge or otherwise), with or without cause, is specifically reserved, subject to any written employment agreement which the Optionee may otherwise have with the Company or any Affiliate (or a successor entity). 10. RIGHTS AS STOCKHOLDER. The Optionee (or transferee of this option by will or by the laws of descent and distribution) shall have no rights as a stockholder with respect to any Shares covered by this Option until such person has duly exercised this Option, paid the Exercise Price and become a holder of record of the Shares purchased. 11. "MARKET STAND-OFF" AGREEMENT. Optionee agrees that, if requested by the Company or the managing underwriter of any proposed public offering of the Company's securities (including any acquisition transaction where the Company securities will be used as all or part of the purchase price), Optionee will not sell or otherwise transfer or dispose of any Shares held by Optionee without the prior written consent of the Company or such underwriter, as the case may be, during such period of time, not to exceed 180 days following the effective date of the registration statement filed by the Company with respect to such offering, as the Company or the underwriter may specify. 4 12. NOTICE OF DISQUALIFYING DISPOSITION. To obtain certain tax benefits afforded to Incentive Options, an Optionee must hold the shares issued upon the exercise of an Incentive Option for two years after the date of grant of the Option and one year from the date of exercise. By executing this Agreement, Optionee hereby agrees to promptly notify the Company's Chief Financial Officer of any disposition of Shares acquired pursuant to an Incentive Stock Option within one year from the date this Option is exercised or within two years of the date of grant of this Option. 13. INTERPRETATION. This Option is granted pursuant to the terms of the Plan, and shall in all respects be interpreted in accordance therewith. The Administrator shall interpret and construe this Option and the Plan, and any action, decision, interpretation or determination made in good faith by the Administrator shall be final and binding on the Company and the Optionee. As used in this Agreement, the term "Administrator" shall refer to the committee of the Board of Directors of the Company appointed to administer the Plan, and if no such committee has been appointed, the term "Administrator" shall mean the Board of Directors. 14. NOTICES. Any notice, demand or request required or permitted to be given under this Agreement shall be in writing and shall be deemed given when delivered personally or three (3) days after being deposited in the United States mail, as certified or registered mail, with postage prepaid, (or by such other method as the Administrator may from time to time deem appropriate), and addressed, if to the Company, at its principal place of business, Attention: the Chief Financial Officer, and if to the Optionee, at his or her most recent address as shown in the employment or stock records of the Company. 15. GOVERNING LAW. The validity, construction, interpretation, and effect of this Option shall be governed by and determined in accordance with the laws of the State of California. 16. SEVERABILITY. Should any provision or portion of this Agreement be held to be unenforceable or invalid for any reason, the remaining provisions and portions of this Agreement shall be unaffected by such holding. 17. ATTORNEYS' FEES. If any party shall bring an action in law or equity against another to enforce or interpret any of the terms, covenants and provisions of this Agreement, the prevailing party in such action shall be entitled to recover reasonable attorneys' fees and costs. 18. COUNTERPARTS. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall be deemed one instrument. [Signature Page Follows] 5 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. THE COMPANY: OPTIONEE: CKE Restaurants, Inc. By: --------------------------------- -------------------------------------- (Signature) Its: --------------------------------- -------------------------------------- (Type or print name) Address: -------------------------------------- -------------------------------------- 6 EX-10.3 3 a10398exv10w3.txt EXHIBIT 10.3 EXHIBIT 10.3 CKE RESTAURANTS, INC. RESTRICTED STOCK AWARD AGREEMENT UNDER 2005 OMNIBUS INCENTIVE COMPENSATION PLAN THIS RESTRICTED STOCK AWARD AGREEMENT (the "Agreement") is entered into as of ___________, 200_ by and between ______________________ (hereinafter referred to as "Purchaser") and CKE Restaurants, Inc., a Delaware corporation (hereinafter referred to as the "Company"), pursuant to the Company's 2005 Omnibus Incentive Compensation Plan (the "Plan"). Any capitalized term not defined herein shall have the same meaning ascribed to it in the Plan. R E C I T A L S: A. Purchaser is an employee or director, and in connection therewith has rendered services for and on behalf of the Company or its Affiliates. B. The Company desires to issue shares of common stock to Purchaser for the consideration set forth herein to provide an incentive for Purchaser to remain a Service Provider of the Company and to exert added effort towards its growth and success. NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth, and for other good and valuable consideration, the parties agree as follows: 1. ISSUANCE OF SHARES. The Company hereby offers to issue to Purchaser an aggregate of _____________ (_____) shares of Common Stock of the Company (the "Shares") on the terms and conditions herein set forth. Unless this offer is earlier revoked in writing by the Company, Purchaser shall have ten (10) days from the date of the delivery of this Agreement to Purchaser to accept the offer of the Company by executing and delivering to the Company two copies of this Agreement, without condition or reservation of any kind whatsoever, together with the consideration to be delivered by Purchaser pursuant to Section 2 below, if applicable. 2. CONSIDERATION. The purchase price for the Shares shall be zero ($0.00). 3. VESTING OF SHARES. (A) Subject to Section 3(b) below, the Shares acquired hereunder shall vest and become "Vested Shares" as to thirty-three and one-third percent (33.33%) of the Shares on the first anniversary of the effective date of this Agreement, and thereafter, thirty-three and one-third percent (33.33%) of the Shares shall become Vested Shares on each subsequent anniversary date of this Agreement, such that 100% of the Shares shall be Vested Shares on the third anniversary of this Agreement. Shares which have not yet become vested are herein called "Unvested Shares." No additional shares shall vest after the date of termination of Purchaser's "Continuous Service" (as defined below). As used herein, the term "Continuous Service" means (i) employment by either the Company or any parent or subsidiary corporation of the Company, or by any successor entity following a Change in Control, which is uninterrupted except for vacations, illness (except for permanent disability, as defined in Section 22(e)(3) of the Code), or leaves of absence which are approved in writing by the Company or any of such other employer corporations, if applicable, or (ii) service as a member of the Board of Directors of the Company until Purchaser resigns, is removed from office, or Purchaser's term of office expires and he or she is not reelected. (B) Notwithstanding Section 3(a), if Purchaser holds Shares at the time a Change in Control occurs, all Repurchase Rights shall automatically terminate effective immediately prior to the occurrence of a Triggering Event (as defined below) occurring within the twelve (12) month period beginning with such Change in Control. (C) For purposes of this Section 3, the following terms shall have the meanings set forth below: (I) "Triggering Event" shall mean (i) the termination of Continuous Service of Purchaser by the Company or an Affiliate (or any successor thereof) other than on account of death, Disability or Cause, (ii) the occurrence of a Constructive Termination or (iii) any failure by the Company (or a successor entity) to assume, replace, convert or otherwise continue this Agreement in connection with the Change in Control (or another corporate transaction or other change effecting the Common Stock) on the same terms and conditions as applied immediately prior to such transaction, except for equitable adjustments to reflect changes in the Common Stock pursuant to Section 6 hereof and Section 4.3 of the Plan. (II) "Cause" shall mean a determination by the Committee that Purchaser (i) has been convicted of, or entered a plea of nolo contendere to, a crime that constitutes a felony under Federal or state law, (ii) has engaged in willful gross misconduct in the performance of the Purchaser's duties to the Company or an Affiliate or (iii) has committed a material breach of any written agreement with the Company or any Affiliate with respect to confidentiality, noncompetition, nonsolicitation or similar restrictive covenant. In the event that the Purchaser is a party to an employment agreement with the Company or any Affiliate that defines a termination on account of "Cause" (or a term having similar meaning), such definition shall apply as the definition of a termination on account of "Cause" for purposes hereof, but only to the extent that such definition provides the Purchaser with greater rights. A termination on account of Cause shall be communicated by written notice to the Purchaser, and shall be deemed to occur on the date such notice is delivered to the Purchaser. (III) "Constructive Termination" shall mean a termination of employment by Purchaser within sixty (60) days following the occurrence of any one or more of the following events without the Purchaser's written consent (i) any reduction in position, title (for Vice Presidents or above), overall responsibilities, level of authority, level of reporting (for Vice Presidents or above), base compensation, annual incentive compensation opportunity, aggregate employee benefits or (ii) a request that Purchaser's location of employment be relocated by more than fifty (50) miles. In the event that the Purchaser is a party to an employment agreement with the Company or any Affiliate (or a successor entity) that defines a termination on account of "Constructive Termination," "Good Reason" or "Breach of Agreement" (or a term having a similar meaning), such definition shall apply as the definition of "Constructive Termination" for purposes hereof in lieu of the foregoing, but only to the extent that such definition provides the Purchaser with greater rights. A Constructive Termination shall be communicated by written notice to the Committee, and shall be deemed to occur on the date such notice is delivered to the Committee, unless the circumstances giving rise to the Constructive Termination are cured within five (5) days of such notice. 2 4. RECONVEYANCE UPON TERMINATION OF SERVICE. (A) REPURCHASE RIGHT. The Company shall have the right (but not the obligation) to repurchase all or any part of the Unvested Shares (the "Repurchase Right") in the event that the Purchaser's Continuous Service terminates for any reason. Upon exercise of the Repurchase Right, the Purchaser shall be obligated to sell his or her Unvested Shares to the Company, as provided in this Section 4. If the Purchase Price is zero, then upon termination of Continuous Service Purchaser shall be obligated to transfer his or her Unvested Shares to the Company for no additional consideration. (B) CONSIDERATION FOR REPURCHASE RIGHT. The repurchase price of the Unvested Shares (the "Repurchase Price") shall be equal to the Purchase Price, if any, of such Unvested Shares. (C) PROCEDURE FOR EXERCISE OF RECONVEYANCE OPTION. For sixty (60) days after the Termination Date or other event described in this Section 4, the Company may exercise the Repurchase Right by giving Purchaser and/or any other person obligated to sell written notice of the number of Unvested Shares which the Company desires to purchase. The Repurchase Price for the Unvested Shares shall be payable, at the option of the Company, by check or by cancellation of all or a portion of any outstanding indebtedness of Purchaser to the Company, or by any combination thereof. (D) NOTIFICATION AND SETTLEMENT. In the event that the Company has elected to exercise the Repurchase Right as to part or all of the Unvested Shares within the period described above, Purchaser or such other person shall deliver to the Company certificate(s) representing the Unvested Shares to be acquired by the Company within thirty (30) days following the date of the notice from the Company. The Company shall deliver to Purchaser against delivery of the Unvested Shares, checks of the Company payable to Purchaser and/or any other person obligated to transfer the Unvested Shares in the aggregate amount of the Repurchase Price, if any, to be paid as set forth in paragraph 4(b) above. (E) DEPOSIT OF UNVESTED SHARES. Purchaser shall deposit with the Company certificates representing the Unvested Shares, together with a duly executed stock assignment separate from certificate in blank, which shall be held by the Secretary of the Company. Purchaser shall be entitled to vote and to receive dividends and distributions on all such deposited Unvested Shares. (F) TERMINATION. The provisions of this Section 4 shall automatically terminate in accordance with Section 3(b) above. (G) ASSIGNMENT. The Company may assign its Repurchase Right under this Section 4 without the consent of the Purchaser. 5. RESTRICTIONS ON UNVESTED SHARES. Unvested Shares may not be sold, transferred, pledged, or otherwise disposed of, except that such Unvested Shares may be transferred to a trust established for the sole benefit of the Purchaser and/or his or her spouse, children or grandchildren. Any Unvested Shares that are transferred as provided herein remain subject to the terms and conditions of this Agreement. 3 6. ADJUSTMENTS UPON CHANGES IN CAPITAL STRUCTURE. In the event that the outstanding Shares of Common Stock of the Company are hereafter increased or decreased or changed into or exchanged for a different number or kind of shares or other securities of the Company by reason of a recapitalization, stock split, combination of shares, reclassification, stock dividend, or other change in the capital structure of the Company, then Purchaser shall be entitled to new or additional or different shares of stock or securities, in order to preserve, as nearly as practical, but not to increase, the benefits of Purchaser under this Agreement, in accordance with the provisions of Section 4.3 of the Plan. Such new, additional or different shares shall be deemed "Shares" for purposes of this Agreement and subject to all of the terms and conditions hereof. 7. SHARES FREE AND CLEAR. All Shares purchased by the Company (or otherwise returned to the Company) pursuant to this Agreement shall be delivered by Purchaser free and clear of all claims, liens and encumbrances of every nature (except the provisions of this Agreement and any conditions concerning the Shares relating to compliance with applicable federal or state securities laws), and the purchaser thereof shall acquire full and complete title and right to all of such Shares, free and clear of any claims, liens and encumbrances of every nature (again, except for the provisions of this Agreement and such securities laws). 8. LIMITATION OF COMPANY'S LIABILITY FOR NONISSUANCE; UNPERMITTED TRANSFERS. (A) The Company agrees to use its reasonable best efforts to obtain from any applicable regulatory agency such authority or approval as may be required in order to issue and sell the Shares to Purchaser pursuant to this Agreement. The inability of the Company to obtain, from any such regulatory agency, authority or approval deemed by the Company's counsel to be necessary for the lawful issuance and sale of the Shares hereunder and under the Plan shall relieve the Company of any liability in respect of the nonissuance or sale of such Shares as to which such requisite authority or approval shall not have been obtained. (B) The Company shall not be required to: (i) transfer on its books any Shares of the Company which shall have been sold or transferred in violation of any of the provisions set forth in this Agreement, or (ii) treat as owner of such shares or to accord the right to vote as such owner or to pay dividends to any transferee to whom such shares shall have been so transferred. 9. NOTICES. Any notice, demand or request required or permitted to be given under this Agreement shall be in writing and shall be deemed given when delivered personally or three (3) days after being deposited in the United States mail, as certified or registered mail, with postage prepaid, (or by such other method as the Administrator may from time to time deem appropriate), and addressed, if to the Company, at its principal place of business, Attention: the Chief Financial Officer, and if to the Purchaser, at his or her most recent address as shown in the employment or stock records of the Company. 10. BINDING OBLIGATIONS. All covenants and agreements herein contained by or on behalf of any of the parties hereto shall bind and inure to the benefit of the parties hereto and their permitted successors and assigns. 11. CAPTIONS AND SECTION HEADINGS. Captions and section headings used herein are for convenience only, and are not part of this Agreement and shall not be used in construing it. 4 12. AMENDMENT. This Agreement may not be amended, waived, discharged, or terminated other than by written agreement of the parties. 13. ENTIRE AGREEMENT. This Agreement and the Plan constitute the entire agreement between the parties with respect to the subject matter hereof and supersede all prior or contemporaneous written or oral agreements and understandings of the parties, either express or implied. 14. ASSIGNMENT. Purchaser shall have no right, without the prior written consent of the Company, to (i) sell, assign, mortgage, pledge or otherwise transfer any interest or right created hereby, or (ii) delegate his or her duties or obligations under this Agreement. This Agreement is made solely for the benefit of the parties hereto, and no other person, partnership, association or corporation shall acquire or have any right under or by virtue of this Agreement. 15. SEVERABILITY. Should any provision or portion of this Agreement be held to be unenforceable or invalid for any reason, the remaining provisions and portions of this Agreement shall be unaffected by such holding. 16. COUNTERPARTS. This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one agreement and any party hereto may execute this Agreement by signing any such counterpart. This Agreement shall be binding upon Purchaser and the Company at such time as the Agreement, in counterpart or otherwise, is executed by Purchaser and the Company. 17. APPLICABLE LAW. This Agreement shall be construed in accordance with the laws of the State of California without reference to choice of law principles, as to all matters, including, but not limited to, matters of validity, construction, effect or performance. 18. NO AGREEMENT TO EMPLOY. Nothing in this Agreement shall affect any right with respect to continuance of employment by the Company or any of its subsidiaries. The right of the Company or any of its subsidiaries to terminate at will the Purchaser's employment at any time (whether by dismissal, discharge or otherwise), with or without cause, is specifically reserved, subject to any other written employment agreement to which the Company and Purchaser may be a party. 19. "MARKET STAND-OFF" AGREEMENT. Purchaser agrees that, if requested by the Company or the managing underwriter of any proposed public offering of the Company's securities (including any acquisition transaction where Company securities will be used as all or part of the purchase price), Purchaser will not sell or otherwise transfer or dispose of any Shares held by Purchaser without the prior written consent of the Company or such underwriter, as the case may be, during such period of time, not to exceed 180 days following the effective date of the registration statement filed by the Company with respect to such offering, as the Company or the underwriter may specify. 20. TAX ELECTIONS. Purchaser understands that Purchaser (and not the Company) shall be responsible for the Purchaser's own tax liability that may arise as a result of the acquisition of the Shares. Purchaser acknowledges that Purchaser has considered the advisability of all tax elections in connection with the purchase of the Shares, including the making of an election under Section 83(b) under the Internal Revenue Code of 1986, as amended ("Code"); Purchaser further 5 acknowledges that the Company has no responsibility for the making of such Section 83(b) election. In the event Purchaser determines to make a Section 83(b) election, Purchaser agrees to timely provide a copy of the election to the Company as required under the Code. 21. ATTORNEYS' FEES. If any party shall bring an action in law or equity against another to enforce or interpret any of the terms, covenants and provisions of this Agreement, the prevailing party in such action shall be entitled to recover reasonable attorneys' fees and costs. [Signature Page Follows] 6 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. THE COMPANY: PURCHASER: CKE RESTAURANTS, INC. By: ---------------------------- -------------------------------------- Name: ---------------------------- -------------------------------------- (Print Name) Title: ---------------------------- Address: -------------------------------------- -------------------------------------- 7 CONSENT AND RATIFICATION OF SPOUSE The undersigned, the spouse of _____________________, a party to the attached Restricted Stock Award Agreement (the "Agreement"), dated as of _______________, hereby consents to the execution of said Agreement by such party; and ratifies, approves, confirms and adopts said Agreement, and agrees to be bound by each and every term and condition thereof as if the undersigned had been a signatory to said Agreement, with respect to the Shares (as defined in the Agreement) made the subject of said Agreement in which the undersigned has an interest, including any community property interest therein. I also acknowledge that I have been advised to obtain independent counsel to represent my interests with respect to this Agreement but that I have declined to do so and I hereby expressly waive my right to such independent counsel. Date: ---------------------------------- ----------------------------------- (Signature) ----------------------------------- (Print Name) EX-10.4 4 a10398exv10w4.txt EXHIBIT 10.4 EXHIBIT 10.4 CKE RESTAURANTS, INC. STOCK APPRECIATION RIGHTS AWARD AGREEMENT UNDER 2005 OMNIBUS INCENTIVE COMPENSATION PLAN THIS STOCK APPRECIATION RIGHTS AWARD AGREEMENT (the "Agreement") is entered into as of ____________, 2005 (the "Grant Date"), by CKE Restaurants, Inc., a Delaware corporation (the "Company"), and _____________ (the "Grantee") pursuant to the Company's 2005 Omnibus Incentive Compensation Plan (the "Plan"). Any capitalized term not defined herein shall have the same meaning ascribed to it in the Plan. R E C I T A L S: A. Grantee is an employee or director, and in connection therewith has rendered services for and on behalf of the Company or its Affiliates. B. The Company desires to issue Stock Appreciation Rights to Grantee to provide an incentive for Grantee to remain a Service Provider of the Company and to exert added effort towards its growth and success. NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth, and for other good and valuable consideration, the parties agree as follows: 1. GRANT OF STOCK APPRECIATION RIGHTS. The Company hereby grants to the Grantee under the Plan and on the terms and on conditions set forth in this Agreement stock appreciation rights with respect to ______________ (_____________) shares of the Company's Common Stock at the "Base Value" per share set forth in Section 2 below (the "SARs"). 2. BASE VALUE AND BENEFIT. The Base Value of each SAR is _______, which is equal to the Fair Market Value of a share of the Company's Common Stock on the Grant Date. Each SAR entitles Grantee to receive from the Company upon the settlement of the SAR an amount, payable in cash, equal to the excess, if any, of (a) the Fair Market Value of one share of Stock on the date of settlement, over (b) the Base Value per share. 3. VESTING OF SARS. (a) The SARs shall vest as follows: [INSERT VESTING SCHEDULE, EITHER TIME-BASED OR PERFORMANCE-BASED] As used herein, the term "Continuous Service" means (i) employment by either the Company or any parent or subsidiary corporation of the Company, or by any successor entity following a Change in Control, which is uninterrupted except for vacations, illness, or leaves of absence which are approved in writing by the Company or any of such other employer corporations, if applicable, or (ii) service as a member of the Board of Directors of the Company until Grantee resigns, is removed from office, or Grantee's term of office expires and he or she is not reelected. (b) Notwithstanding the vesting schedule, if Grantee's employment terminates by reason of his or her death or Disability at any time the SARs shall become fully vested as of such date of termination. (c) If Grantee holds SARs at the time a Change in Control occurs, all of the SARs shall become immediately and unconditionally vested and exercisable, and the restrictions with respect to all of the SARs shall lapse, effective immediately prior to the occurrence of a Triggering Event (as defined below) occurring within the twelve (12) month period beginning with such Change in Control. (d) For purposes of this Section 3, the following terms shall have the meanings set forth below: (i) "Triggering Event" shall mean (i) the termination of Continuous Service of Grantee by the Company or an Affiliate (or any successor thereof) other than on account of death, Disability or Cause, (ii) the occurrence of a Constructive Termination or (iii) any failure by the Company (or a successor entity) to assume, replace, convert or otherwise continue this Agreement in connection with the Change in Control (or another corporate transaction or other change effecting the Common Stock) on the same terms and conditions as applied immediately prior to such transaction, except for equitable adjustments to reflect changes in the Common Stock pursuant to Section 4.3 of the Plan. (ii) "Cause" shall mean a determination by the Committee that Grantee (i) has been convicted of, or entered a plea of nolo contendere to, a crime that constitutes a felony under Federal or state law, (ii) has engaged in willful gross misconduct in the performance of the Grantee's duties to the Company or an Affiliate or (iii) has committed a material breach of any written agreement with the Company or any Affiliate with respect to confidentiality, noncompetition, nonsolicitation or similar restrictive covenant. In the event that the Grantee is a party to an employment agreement with the Company or any Affiliate that defines a termination on account of "Cause" (or a term having similar meaning), such definition shall apply as the definition of a termination on account of "Cause" for purposes hereof, but only to the extent that such definition provides the Grantee with greater rights. A termination on account of Cause shall be communicated by written notice to the Grantee, and shall be deemed to occur on the date such notice is delivered to the Grantee. (iii) "Constructive Termination" shall mean a termination of employment by Grantee within sixty (60) days following the occurrence of any one or more of the following events without the Grantee's written consent (i) any reduction in position, title (for Vice Presidents or above), overall responsibilities, level of authority, level of reporting (for Vice Presidents or above), base compensation, annual incentive compensation opportunity, aggregate employee benefits or (ii) a request that Grantee's location of employment be relocated by more than fifty (50) miles. In the event that the Grantee is a party to an employment agreement with the Company or any Affiliate (or a successor entity) that defines a termination on account of "Constructive Termination," "Good Reason" or "Breach of Agreement" (or a term having a similar meaning), such definition shall apply as the definition of "Constructive Termination" for purposes hereof in lieu of the foregoing, but only to the extent that such definition provides the Grantee with greater rights. A Constructive Termination shall be communicated by written notice to the Committee, and shall be deemed to occur on the date such notice is delivered to the Committee, unless the circumstances giving rise to the Constructive Termination are cured within five (5) days of such notice. 4. TERM OF SARS AND LIMITATIONS ON RIGHT TO EXERCISE. The term of the SARs is a period of [five] years, expiring on the [fifth] anniversary of the Grant Date (the "Expiration Date"). To the extent not previously exercised, the SARs will lapse three months after the termination of the Grantee's employment with the Company for any reason. The Committee may, subject to Section 9(c) below, prior to the lapse of the SARs under the circumstances described in this Section, extend the time to exercise the SARs. If the Grantee or his or her beneficiary exercises a SAR after termination of employment, the SARs may be exercised only with respect to the shares that were otherwise vested as of such termination. 5. VALUE AND SETTLEMENT OF SARS. (a) The value due upon exercise or settlement of the SARs is calculated as follows: the number of SARs being exercised or settled, times the excess, if any, of (i) the Fair Market Value of one share of Stock on the date of exercise or settlement, over (ii) the Base Value of the SAR. (b) SARs subject to this Agreement that vest in accordance with the conditions set forth herein shall result in payment to Grantee of an amount calculated pursuant to Section 5(a) promptly on or as soon as practicable after the vesting date of such SARs. Such payment shall be subject to the tax withholding provisions of Section 9, and shall be in complete satisfaction of such vested SARs. 6. DIVIDEND EQUIVALENTS. No dividend equivalent rights shall attach to the SARs granted hereby. 7. ADJUSTMENTS TO SARS. Upon or in contemplation of any reclassification, recapitalization, stock split, reverse stock split or stock dividend; any merger, combination, consolidation or other reorganization; any split-up, spin-off, or similar extraordinary dividend distribution in respect of the Common Stock (whether in the form of securities or property); any exchange of Common Stock or other securities of the Company, or any similar, unusual or extraordinary corporate transaction in respect of the Common Stock; or a sale of substantially all the assets of the Company as an entirety; then the Company shall, in such manner, to such extent (if any) and at such time as it deems appropriate and equitable in the circumstances, make adjustments if appropriate in the number or terms of the SARs as provided in Section 4.3 of the Plan . 8. LIMITATION OF RIGHTS. The SARs do not confer to Grantee or Grantee's beneficiary any rights of a shareholder of the Company unless and until shares of Stock are in fact issued to such person in connection with the exercise of the SARs. Nothing in this Agreement shall interfere with or limit in any way the right of the Company or any affiliate to terminate Grantee's employment at any time, nor confer upon Grantee any right to continue in the employment of the Company or any affiliate. 9. INCOME TAX MATTERS. (a) In order to comply with all applicable federal or state income tax laws or regulations, the Company may take such action as it deems appropriate to ensure that all applicable federal or state payroll, withholding, income or other taxes, which are the sole and absolute responsibility of Grantee, are withheld or collected from Grantee. (b) The Company shall reasonably determine the amount of any federal, state, local or other income, employment, or other taxes which the Company or any of its affiliates may reasonably be obligated to withhold with respect to the grant, vesting, or other event with respect to the SARs. The Company may, in its sole discretion, withhold an amount from the proceeds of the SARs upon exercise or settlement sufficient to satisfy the amount of any such withholding obligations that arise with respect to the vesting of such SARs. The Company may take such action(s) without notice to the Grantee and shall remit to the Grantee the balance of any proceeds from withholding such proceeds in excess of the amount reasonably determined to be necessary to satisfy such withholding obligations. The Grantee shall have no discretion as to the satisfaction of tax withholding obligations in such manner. If, however, any withholding event occurs with respect to the SARs other than upon the vesting of such SARs, or if the Company for any reason does not satisfy the withholding obligations with respect to the vesting of the SARs as provided above in this Section 9(b), the Company shall be entitled to require a cash payment by or on behalf of the Grantee and/or to deduct from other compensation payable to the Grantee the amount of any such withholding obligations. (c) The SARs evidenced by this Agreement, and the related payments to Grantee in settlement of vested SARs, is intended to be taxed under the provisions of Section 83 of the Internal Revenue Code of 1986, as amended (the "Code"), and is not intended to provide and does not provide for the deferral of compensation within the meaning of Section 409A(d) of the Code. Therefore, the Company intends to report as includible in the Grantee's gross income for any taxable year an amount equal to the Fair Market Value of the shares of Common Stock covered by the SARs that vest (if any) during such taxable year, determined as of the date such SARs vest. In furtherance of this intended tax treatment, all vested Units shall be automatically settled and payment to the Grantee shall be made as provided in Section 1(c) hereof, but in no event later than March 15th of the year following the calendar year in which such Units vest. The Grantee shall have no power to affect the timing of such settlement or payment. The Company reserves the right to amend this Agreement, without the Grantee's consent, to the extent it reasonably determines from time to time that such amendment is necessary in order to achieve the purposes of this Section. 10. NOTICES. All notices, requests, demands and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given and effective (i) when delivered by hand, (ii) when otherwise delivered against receipt therefor, or (iii) three (3) business days after being mailed if sent by registered or certified mail, postage prepaid, return receipt requested. Any notice shall be addressed to the parties as follows or at such other address as a party may designate by notice given to the other party in the manner set forth herein: (a) if to the Company: CKE Restaurants, Inc. 6307 Carpinteria Ave., Ste. A Carpinteria, CA 93013 Attention: Chief Financial Officer (b) if to the Grantee, at the address shown on the signature page of this Agreement or at his most recent address as shown in the employment or stock records of the Company. 11. BINDING OBLIGATIONS. All covenants and agreements herein contained by or on behalf of any of the parties hereto shall bind and inure to the benefit of the parties hereto and their permitted successors and assigns. 12. CAPTIONS AND SECTION HEADINGS. Captions and section headings used herein are for convenience only, and are not part of this Agreement and shall not be used in construing it. 13. AMENDMENT. This Agreement may not be amended, waived, discharged, or terminated other than by written agreement of the parties. 14. ENTIRE AGREEMENT. This Agreement and the Plan constitute the entire agreement between the parties with respect to the subject matter hereof and supersede all prior or contemporaneous written or oral agreements and understandings of the parties, either express or implied. 15. CONFLICT OF PROVISIONS. The terms contained in the Plan are incorporated into and made a part of this Agreement and this Agreement shall be governed by and construed in accordance with the Plan. In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Agreement, the provisions of the Plan shall be controlling and determinative. 16. ASSIGNMENT. Grantee shall have no right, without the prior written consent of the Company, to (i) sell, assign, mortgage, pledge or otherwise transfer any interest or right created hereby, or (ii) delegate his or her duties or obligations under this Agreement. This Agreement is made solely for the benefit of the parties hereto, and no other person, partnership, association or corporation shall acquire or have any right under or by virtue of this Agreement. 17. SEVERABILITY. Should any provision or portion of this Agreement be held to be unenforceable or invalid for any reason, the remaining provisions and portions of this Agreement shall be unaffected by such holding. 18. APPLICABLE LAW. This Agreement shall be construed in accordance with the laws of the State of California without reference to choice of law principles, as to all matters, including, but not limited to, matters of validity, construction, effect or performance. 19. NO AGREEMENT TO EMPLOY. Nothing in this Agreement shall affect any right with respect to continuance of employment by the Company or any of its subsidiaries. The right of the Company or any of its subsidiaries to terminate at will the Grantee's employment at any time (whether by dismissal, discharge or otherwise), with or without cause, is specifically reserved, subject to any other written employment agreement to which the Company and Grantee may be a party. 20. "MARKET STAND-OFF" AGREEMENT. Grantee agrees that, if requested by the Company or the managing underwriter of any proposed public offering of the Company's securities (including any acquisition transaction where Company securities will be used as all or part of the purchase price), Grantee will not sell or otherwise transfer or dispose of any Shares held by Grantee without the prior written consent of the Company or such underwriter, as the case may be, during such period of time, not to exceed 180 days following the effective date of the registration statement filed by the Company with respect to such offering, as the Company or the underwriter may specify. 21. ATTORNEYS' FEES. If any party shall bring an action in law or equity against another to enforce or interpret any of the terms, covenants and provisions of this Agreement, the prevailing party in such action shall be entitled to recover reasonable attorneys' fees and costs. 22. COUNTERPARTS. This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one agreement and any party hereto may execute this Agreement by signing any such counterpart. This Agreement shall be binding upon Grantee and the Company at such time as the Agreement, in counterpart or otherwise, is executed by Grantee and the Company. [Signature Page Follows] IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. THE COMPANY: GRANTEE: CKE RESTAURANTS, INC. By: ------------------------------- -------------------------------------- Name: ------------------------------- -------------------------------------- (Print Name) Title: ------------------------------- Address: -------------------------------------- -------------------------------------- EXHIBIT 10.4 CONSENT AND RATIFICATION OF SPOUSE The undersigned, the spouse of _____________________, a party to the attached Stock Appreciation Rights Award Agreement (the "Agreement"), dated as of _______________, hereby consents to the execution of said Agreement by such party; and ratifies, approves, confirms and adopts said Agreement, and agrees to be bound by each and every term and condition thereof as if the undersigned had been a signatory to said Agreement, with respect to the Stock Appreciation Rights (as defined in the Agreement) made the subject of said Agreement in which the undersigned has an interest, including any community property interest therein. I also acknowledge that I have been advised to obtain independent counsel to represent my interests with respect to this Agreement but that I have declined to do so and I hereby expressly waive my right to such independent counsel. Date: ---------------------------- -------------------------------------- (Signature) -------------------------------------- (Print Name) EX-10.5 5 a10398exv10w5.txt EXHIBIT 10.5 EXHIBIT 10.5 Award Number: ______ CKE RESTAURANTS, INC. RESTRICTED STOCK UNIT AWARD AGREEMENT UNDER 2005 OMNIBUS INCENTIVE COMPENSATION PLAN Award Date Number of Units Final Vesting Date [Restricted Stock Units]
CKE Restaurants, Inc. (the "Company") has on the Award Date specified above granted to ______________________________ ("Grantee") an award (the "Award") to receive that number of restricted stock units (the "Restricted Stock Units") indicated above in the box labeled "Number of Units," each Restricted Stock Unit representing the right to receive one share of the Company's Common Stock, $.01 par value per share (the "Common Stock"), subject to certain restrictions and on the terms and conditions contained in this Award and the CKE Restaurants, Inc. 2005 Omnibus Incentive Compensation Plan (the "Plan"). Any terms not defined herein shall have the meaning set forth in the Plan. 1. RIGHTS OF THE GRANTEE WITH RESPECT TO THE RESTRICTED STOCK UNITS. (a) NO STOCKHOLDER RIGHTS. The Grantee shall have no rights as a stockholder of the Company until shares of Common Stock are actually issued to and held of record by the Grantee. The rights of Grantee with respect to the Restricted Stock Units shall remain forfeitable at all times prior to the date on which such rights become vested, and the restrictions with respect to the Restricted Stock Units lapse, in accordance with Section 2, 3 or 4 below. (b) ADDITIONAL RESTRICTED STOCK UNITS. As long as Grantee holds Restricted Stock Units granted pursuant to this Award, the Company shall credit to Grantee, on each date that the Company pays a cash dividend to holders of Common Stock generally, an additional number of Restricted Stock Units ("Additional Restricted Stock Units") equal to the total number of whole Restricted Stock Units and Additional Restricted Stock Units previously credited to Grantee under this Award multiplied by the dollar amount of the cash dividend paid per share of Common Stock by the Company on such date, divided by the Fair Market Value of a share of Common Stock on such date. Any fractional Restricted Stock Unit resulting from such calculation shall be included in the Additional Restricted Stock Units. A report showing the number of Additional Restricted Stock Units so credited shall be sent to Grantee periodically, as determined by the Company. The Additional Restricted Stock Units so credited shall be subject to the same terms and conditions as the Restricted Stock Units to which such Additional Restricted Stock Units relate and the Additional Restricted Stock Units shall be forfeited in the event that the Restricted Stock Units with respect to which such Additional Restricted Stock Units were credited are forfeited. (c) CONVERSION OF RESTRICTED STOCK UNITS; ISSUANCE OF COMMON STOCK. No shares of Common Stock shall be issued to Grantee prior to the date on which the Restricted Stock Units vest, and the restrictions with respect to the Restricted Stock Units lapse, in accordance with Section 2, 3 or 4. Neither this Section 1(c) nor any action taken pursuant to or in accordance with this Section 1(c) shall be construed to create a trust of any kind. As soon as practical after any Restricted Stock Units vest pursuant to Section 2, 3 or 4, the Company shall promptly cause to be issued an equivalent number of shares of Common Stock, registered in Grantee's name or in the name of Grantee's legal representatives, beneficiaries or heirs, as the case may be, in payment of such vested whole Restricted Stock Units and any Additional Restricted Stock Units. Such payment shall be subject to the tax withholding provisions of Section 7, and shall be in complete satisfaction of such vested Restricted Stock Units. The value of any fractional Restricted Stock Unit shall be paid in cash at the time certificates are delivered to Grantee in payment of the Restricted Stock Units and any Additional Restricted Stock Units. 2. VESTING. Subject to the terms and conditions of this Award, the Restricted Stock Units shall become vested in installments as follows: [INSERT VESTING SCHEDULE, EITHER TIME-BASED OR PERFORMANCE-BASED]. As used herein, the term "Continuous Service" means (i) employment by either the Company or any parent or subsidiary corporation of the Company, or by any successor entity following a Change in Control, which is uninterrupted except for vacations, illness, or leaves of absence which are approved in writing by the Company or any of such other employer corporations, if applicable, or (ii) service as a member of the Board of Directors of the Company until Grantee resigns, is removed from office, or Grantee's term of office expires and he or she is not reelected. 3. VESTING UPON CHANGE IN CONTROL. (a) Notwithstanding Section 2 above, if Grantee holds Restrictive Stock Units at the time a Change in Control occurs, all of the Restricted Stock Units shall become immediately and unconditionally vested and exercisable, and the restrictions with respect to all of the Restricted Stock Units shall lapse, effective immediately prior to the occurrence of a Triggering Event (as defined below) occurring within the twelve (12) month period beginning with such Change in Control. (b) For purposes of this Section 3, the following terms shall have the meanings set forth below: (i) "Triggering Event" shall mean (i) the termination of Continuous Service of Grantee by the Company or an Affiliate (or any successor thereof) other than on account of death, Disability or Cause, (ii) the occurrence of a Constructive Termination or (iii) any failure by the Company (or a successor entity) to assume, replace, convert or otherwise continue this Agreement in connection with the Change in Control (or another corporate transaction or other change effecting the Common Stock) on the same terms and conditions as applied immediately prior to such transaction, except for equitable adjustments to reflect changes in the Common Stock pursuant to Section 6 hereof and Section 4.3 of the Plan. 2 (ii) "Cause" shall mean a determination by the Committee that Grantee (i) has been convicted of, or entered a plea of nolo contendere to, a crime that constitutes a felony under Federal or state law, (ii) has engaged in willful gross misconduct in the performance of the Grantee's duties to the Company or an Affiliate or (iii) has committed a material breach of any written agreement with the Company or any Affiliate with respect to confidentiality, noncompetition, nonsolicitation or similar restrictive covenant. In the event that the Grantee is a party to an employment agreement with the Company or any Affiliate that defines a termination on account of "Cause" (or a term having similar meaning), such definition shall apply as the definition of a termination on account of "Cause" for purposes hereof, but only to the extent that such definition provides the Grantee with greater rights. A termination on account of Cause shall be communicated by written notice to the Grantee, and shall be deemed to occur on the date such notice is delivered to the Grantee. (iii) "Constructive Termination" shall mean a termination of employment by Grantee within sixty (60) days following the occurrence of any one or more of the following events without the Grantee's written consent (i) any reduction in position, title (for Vice Presidents or above), overall responsibilities, level of authority, level of reporting (for Vice Presidents or above), base compensation, annual incentive compensation opportunity, aggregate employee benefits or (ii) a request that Grantee's location of employment be relocated by more than fifty (50) miles. In the event that the Grantee is a party to an employment agreement with the Company or any Affiliate (or a successor entity) that defines a termination on account of "Constructive Termination," "Good Reason" or "Breach of Agreement" (or a term having a similar meaning), such definition shall apply as the definition of "Constructive Termination" for purposes hereof in lieu of the foregoing, but only to the extent that such definition provides the Grantee with greater rights. A Constructive Termination shall be communicated by written notice to the Committee, and shall be deemed to occur on the date such notice is delivered to the Committee, unless the circumstances giving rise to the Constructive Termination are cured within five (5) days of such notice. 4. FORFEITURE OR EARLY VESTING UPON TERMINATION OF EMPLOYMENT. (a) TERMINATION OF EMPLOYMENT GENERALLY. If, prior to vesting of the Restricted Stock Units pursuant to Section 2 or 3, Grantee ceases to be an employee of the Company, or ceases to serve on the Board of Directors of the Company, for any reason (voluntary or involuntary) other than death or permanent long-term disability, then Grantee's rights to all of the unvested Restricted Stock Units shall be immediately and irrevocably forfeited, including the right to receive any Additional Restricted Stock Units. (b) DEATH OR DISABILITY. If Grantee dies while employed by the Company or its subsidiaries, or if Grantee's employment by the Company or its subsidiaries is terminated due to Grantee's failure to return to work as the result of Grantee's Disability (as defined in the Plan), then all unvested Restricted Stock Units shall become immediately vested, and the restrictions with respect to all of the Restricted Stock Units shall lapse, as of the date of such Disability or death. No transfer by will or the applicable laws of descent and distribution of any Restricted Stock Units that vest by reason of Grantee's death shall be effective to bind the Company unless the Committee shall 3 have been furnished with written notice of such transfer and a copy of the will or such other evidence as the Committee may deem necessary to establish the validity of the transfer. 5. RESTRICTION ON TRANSFER. The Restricted Stock Units and any rights under this Award may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of by Grantee otherwise than by will or by the laws of descent and distribution, and any such purported sale, assignment, transfer, pledge, hypothecation or other disposition shall be void and unenforceable against the Company. Notwithstanding the foregoing, Grantee may, in the manner established by the Committee, designate a beneficiary or beneficiaries to exercise the rights of Grantee and receive any property distributable with respect to the Restricted Stock Units upon the death of Grantee. 6. ADJUSTMENTS TO RESTRICTED STOCK UNITS. Upon or in contemplation of any reclassification, recapitalization, stock split, reverse stock split or stock dividend; any merger, combination, consolidation or other reorganization; any split-up, spin-off, or similar extraordinary dividend distribution in respect of the Common Stock (whether in the form of securities or property); any exchange of Common Stock or other securities of the Company, or any similar, unusual or extraordinary corporate transaction in respect of the Common Stock; or a sale of substantially all the assets of the Company as an entirety; then the Company shall, in such manner, to such extent (if any) and at such time as it deems appropriate and equitable in the circumstances, make adjustments if appropriate in the number of Restricted Stock Units subject to this Agreement and the number and kind of securities that may be issued in respect of such Units. 7. INCOME TAX MATTERS. (a) In order to comply with all applicable federal or state income tax laws or regulations, the Company may take such action as it deems appropriate to ensure that all applicable federal or state payroll, withholding, income or other taxes, which are the sole and absolute responsibility of Grantee, are withheld or collected from Grantee. (b) The Company shall reasonably determine the amount of any federal, state, local or other income, employment, or other taxes which the Company or any of its affiliates may reasonably be obligated to withhold with respect to the grant, vesting, or other event with respect to the Restricted Stock Units. The Company may, in its sole discretion, withhold a sufficient number of shares of Common Stock in connection with the vesting of the Restricted Stock Units at the Fair Market Value (as defined in the Plan) of the Common Stock (determined as of the date of measurement of the amount of income subject to such withholding) to satisfy the amount of any such withholding obligations that arise with respect to the vesting of such Restricted Stock Units. The Company may take such action(s) without notice to the Grantee and shall remit to the Grantee the balance of any proceeds from withholding such shares in excess of the amount reasonably determined to be necessary to satisfy such withholding obligations. The Grantee shall have no discretion as to the satisfaction of tax withholding obligations in such manner. If, however, any withholding event occurs with respect to the Restricted Stock Units other than upon the vesting of such Units, or if the Company for any reason does not satisfy the withholding obligations with respect to the vesting of the Units as provided above in this Section 7(b), the Company shall be entitled to require a cash payment by or on behalf of the Grantee and/or to deduct from other compensation payable to the Grantee the amount of any such withholding obligations. 4 (c) The Restricted Stock Unit Award evidenced by this Agreement, and the issuance of shares of Common Stock to the Grantee in settlement of vested Units, is intended to be taxed under the provisions of Section 83 of the Internal Revenue Code of 1986, as amended (the "Code"), and is not intended to provide and does not provide for the deferral of compensation within the meaning of Section 409A(d) of the Code. Therefore, the Company intends to report as includible in the Grantee's gross income for any taxable year an amount equal to the Fair Market Value of the shares of Common Stock covered by the Units that vest (if any) during such taxable year, determined as of the date such Units vest. In furtherance of this intended tax treatment, all vested Units shall be automatically settled and payment to the Grantee shall be made as provided in Section 1(c) hereof, but in no event later than March 15th of the year following the calendar year in which such Units vest. The Grantee shall have no power to affect the timing of such settlement or payment. The Company reserves the right to amend this Agreement, without the Grantee's consent, to the extent it reasonably determines from time to time that such amendment is necessary in order to achieve the purposes of this Section. 8. COMPLIANCE WITH LAWS. The Award and the offer, issuance and delivery of securities under this Agreement are subject to compliance with all applicable federal and state laws, rules and regulations (including but not limited to state and federal securities laws) and to such approvals by any listing, regulatory or governmental authority as may, in the opinion of counsel for the Company, be necessary or advisable in connection therewith. The Grantee will, if requested by the Company, provide such assurances and representations to the Company as the Company may deem necessary or desirable to assure compliance with all applicable legal requirements. The Company will cause such action to be taken, and such filings to be made, so that the grant hereunder shall comply with the rules of the New York Stock Exchange or the principal stock exchange on which shares of the Company's Common Stock are then listed for trading. 9. NO AGREEMENT TO EMPLOY. Nothing in this Agreement shall affect any right with respect to continuance of employment by the Company or any of its subsidiaries. The right of the Company or any of its subsidiaries to terminate at will the Grantee's employment at any time (whether by dismissal, discharge or otherwise), with or without cause, is specifically reserved, subject to any other written employment agreement to which the Company and Grantee may be a party. 10. ENTIRE AGREEMENT. This Agreement and the Plan constitute the entire agreement between the parties with respect to the subject matter hereof and supersede all prior or contemporaneous written or oral agreements and understandings of the parties, either express or implied. 11. CONFLICT OF PROVISIONS. The terms contained in the Plan are incorporated into and made a part of this Agreement and this Agreement shall be governed by and construed in accordance with the Plan. In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Agreement, the provisions of the Plan shall be controlling and determinative. 12. ASSIGNMENT. Grantee shall have no right, without the prior written consent of the Company, to (i) sell, assign, mortgage, pledge or otherwise transfer any interest or right created hereby, or (ii) delegate his or her duties or obligations under this Agreement. This Agreement is made solely for the benefit of the parties hereto, and no other person, partnership, association or corporation shall acquire or have any right under or by virtue of this Agreement. 5 13. "MARKET STAND-OFF" AGREEMENT. Grantee agrees that, if requested by the Company or the managing underwriter of any proposed public offering of the Company's securities (including any acquisition transaction where Company securities will be used as all or part of the purchase price), Grantee will not sell or otherwise transfer or dispose of any shares of Common Stock held by Grantee without the prior written consent of the Company or such underwriter, as the case may be, during such period of time, not to exceed 180 days following the effective date of the registration statement filed by the Company with respect to such offering, as the Company or the underwriter may specify. 14. SEVERABILITY. Should any provision or portion of this Agreement be held to be unenforceable or invalid for any reason, the remaining provisions and portions of this Agreement shall be unaffected by such holding. 15. NOTICES. All notices, requests, demands and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given and effective (i) when delivered by hand, (ii) when otherwise delivered against receipt therefor, or (iii) three (3) business days after being mailed if sent by registered or certified mail, postage prepaid, return receipt requested. Any notice shall be addressed to the parties as follows or at such other address as a party may designate by notice given to the other party in the manner set forth herein: (a) if to the Company: CKE Restaurants, Inc. 6307 Carpinteria Ave., Ste. A Carpinteria, CA 93013 Attention: Chief Financial Officer (b) if to the Grantee, at the address shown on the signature page of this Agreement or at his most recent address as shown in the employment or stock records of the Company. 16. APPLICABLE LAW. This Agreement shall be construed in accordance with the laws of the State of California without reference to choice of law principles, as to all matters, including, but not limited to, matters of validity, construction, effect or performance. 17. NUMBER AND GENDER. Where the context requires, the singular shall include the plural, the plural shall include the singular, and any gender shall include all other genders. 18. SECTION HEADINGS. The section headings of, and titles of paragraphs and subparagraphs contained in, this Agreement are for the purpose of convenience only, and they neither form a part of this Agreement nor are they to be used in the construction or interpretation thereof. 19. MODIFICATIONS. This Agreement may not be amended, modified or changed (in whole or in part), except by a written agreement expressly referring to this Agreement, which agreement is executed by both of the parties hereto. Notwithstanding the foregoing, amendments made pursuant to Section 7(c) hereof may be effectuated solely by the Company. 6 20. WAIVER. Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver. 21. COUNTERPARTS. This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one agreement and any party hereto may execute this Agreement by signing any such counterpart. This Agreement shall be binding upon Grantee and the Company at such time as the Agreement, in counterpart or otherwise, is executed by Grantee and the Company. [Signature Page Follows] 7 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. THE COMPANY: GRANTEE: CKE RESTAURANTS, INC. By: ------------------------------ ------------------------------------- Name: ------------------------------ ------------------------------------- (Print Name) Title: ------------------------------ Address: ------------------------------------- ------------------------------------- 8 CONSENT AND RATIFICATION OF SPOUSE The undersigned, the spouse of _____________________, a party to the attached Restricted Stock Unit Award Agreement (the "Agreement"), dated as of _______________, hereby consents to the execution of said Agreement by such party; and ratifies, approves, confirms and adopts said Agreement, and agrees to be bound by each and every term and condition thereof as if the undersigned had been a signatory to said Agreement, with respect to the Restricted Stock Units (as defined in the Agreement) made the subject of said Agreement in which the undersigned has an interest, including any community property interest therein. I also acknowledge that I have been advised to obtain independent counsel to represent my interests with respect to this Agreement but that I have declined to do so and I hereby expressly waive my right to such independent counsel. Date: -------------------------------- ------------------------------------- (Signature) ------------------------------------- (Print Name) 9 EX-10.6 6 a10398exv10w6.txt EXHIBIT 10.6 EXHIBIT 10.6 CKE RESTAURANTS, INC. STOCK AWARD AGREEMENT UNDER 2005 OMNIBUS INCENTIVE COMPENSATION PLAN THIS STOCK AWARD AGREEMENT (the "Agreement") is entered into as of ___________, 200_ by and between ______________________ (hereinafter referred to as "Grantee") and CKE Restaurants, Inc., a Delaware corporation (hereinafter referred to as the "Company"), pursuant to the Company's 2005 Omnibus Incentive Compensation Plan (the "Plan"). Any capitalized term not defined herein shall have the same meaning ascribed to it in the Plan. R E C I T A L S: A. Grantee is an employee or director, and in connection therewith has rendered services for and on behalf of the Company or its Affiliates. B. The Company desires to issue shares of common stock to Grantee for the consideration set forth herein to provide an incentive for Grantee to remain a Service Provider of the Company and to exert added effort towards its growth and success. NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth, and for other good and valuable consideration, the parties agree as follows: 1. ISSUANCE OF SHARES. The Company hereby offers to issue to Grantee an aggregate of _____________ (_____) shares of Common Stock of the Company (the "Shares") on the terms and conditions herein set forth. Unless this offer is earlier revoked in writing by the Company, Grantee shall have ten (10) days from the date of the delivery of this Agreement to Grantee to accept the offer of the Company by executing and delivering to the Company two copies of this Agreement, without condition or reservation of any kind whatsoever, together with the consideration to be delivered by Grantee pursuant to Section 2 below, if applicable. 2. CONSIDERATION. The purchase price for the Shares shall be zero ($0.00). 3. VESTING OF SHARES. The Shares shall be fully vested as of the date of this Agreement. 4. LIMITATION OF COMPANY'S LIABILITY FOR NONISSUANCE. The Company agrees to use its reasonable best efforts to obtain from any applicable regulatory agency such authority or approval as may be required in order to issue and sell the Shares to Grantee pursuant to this Agreement. The inability of the Company to obtain, from any such regulatory agency, authority or approval deemed by the Company's counsel to be necessary for the lawful issuance and sale of the Shares hereunder and under the Plan shall relieve the Company of any liability in respect of the nonissuance or sale of such Shares as to which such requisite authority or approval shall not have been obtained. 5. NOTICES. All notices, requests, demands and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given and effective (i) when delivered by hand, (ii) when otherwise delivered against receipt therefor, or (iii) three (3) business days after being mailed if sent by registered or certified mail, postage prepaid, return receipt requested. Any notice shall be addressed to the parties as follows or at such other address as a party may designate by notice given to the other party in the manner set forth herein: (A) if to the Company: CKE Restaurants, Inc. 6307 Carpinteria Ave., Ste. A Carpinteria, CA 93013 Attention: Chief Financial Officer (B) if to the Grantee, at the address shown on the signature page of this Agreement or at his most recent address as shown in the employment or stock records of the Company. 6. BINDING OBLIGATIONS. All covenants and agreements herein contained by or on behalf of any of the parties hereto shall bind and inure to the benefit of the parties hereto and their permitted successors and assigns. 7. CAPTIONS AND SECTION HEADINGS. Captions and section headings used herein are for convenience only, and are not part of this Agreement and shall not be used in construing it. 8. NUMBER AND GENDER. Where the context requires, the singular shall include the plural, the plural shall include the singular, and any gender shall include all other genders. 9. AMENDMENT. This Agreement may not be amended, waived, discharged, or terminated other than by written agreement of the parties. 10. ENTIRE AGREEMENT. This Agreement and the Plan constitute the entire agreement between the parties with respect to the subject matter hereof and supersede all prior or contemporaneous written or oral agreements and understandings of the parties, either express or implied. 11. ASSIGNMENT. Grantee shall have no right, without the prior written consent of the Company, to (i) sell, assign, mortgage, pledge or otherwise transfer any interest or right created hereby, or (ii) delegate his or her duties or obligations under this Agreement. This Agreement is made solely for the benefit of the parties hereto, and no other person, partnership, association or corporation shall acquire or have any right under or by virtue of this Agreement. 12. SEVERABILITY. Should any provision or portion of this Agreement be held to be unenforceable or invalid for any reason, the remaining provisions and portions of this Agreement shall be unaffected by such holding. 13. APPLICABLE LAW. This Agreement shall be construed in accordance with the laws of the State of California without reference to choice of law principles, as to all matters, including, but not limited to, matters of validity, construction, effect or performance. 2 14. NO EMPLOYMENT CONTRACT CREATED. Nothing in this Agreement shall be construed as granting to the Grantee any right with respect to continuance of employment by the Company or any Affiliate (or a successor entity). The right of the Company or any Affiliate (or successor entity) to terminate at will the Grantee's employment at any time (whether by dismissal, discharge or otherwise), with or without cause, is specifically reserved, subject to any written employment agreement which the Grantee may otherwise have with the Company or any Affiliate (or a successor entity). 15. "MARKET STAND-OFF" AGREEMENT. Grantee agrees that, if requested by the Company or the managing underwriter of any proposed public offering of the Company's securities (including any acquisition transaction where Company securities will be used as all or part of the purchase price), Grantee will not sell or otherwise transfer or dispose of any Shares held by Grantee without the prior written consent of the Company or such underwriter, as the case may be, during such period of time, not to exceed 180 days following the effective date of the registration statement filed by the Company with respect to such offering, as the Company or the underwriter may specify. 16. TAX CONSEQUENCES. Grantee understands that Grantee (and not the Company) shall be responsible for the Grantee's own tax liability that may arise as a result of the acquisition of the Shares. The Company has the authority to require Grantee to remit to the Company an amount sufficient to satisfy all federal, state, and local taxes required by law to be withheld with respect to any taxable event arising as a result of the receipt of the Shares. 17. ATTORNEYS' FEES. If any party shall bring an action in law or equity against another to enforce or interpret any of the terms, covenants and provisions of this Agreement, the prevailing party in such action shall be entitled to recover reasonable attorneys' fees and costs. 18. COUNTERPARTS. This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one agreement and any party hereto may execute this Agreement by signing any such counterpart. This Agreement shall be binding upon Grantee and the Company at such time as the Agreement, in counterpart or otherwise, is executed by Grantee and the Company. [Signature Page Follows] 3 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. THE COMPANY: GRANTEE: CKE RESTAURANTS, INC. By: ------------------------------- ------------------------------------- Name: ------------------------------- ------------------------------------- (Print Name) Title: ------------------------------- Address: ------------------------------------- ------------------------------------- 4 CONSENT AND RATIFICATION OF SPOUSE The undersigned, the spouse of _____________________, a party to the attached Stock Award Agreement (the "Agreement"), dated as of _______________, hereby consents to the execution of said Agreement by such party; and ratifies, approves, confirms and adopts said Agreement, and agrees to be bound by each and every term and condition thereof as if the undersigned had been a signatory to said Agreement, with respect to the Shares (as defined in the Agreement) made the subject of said Agreement in which the undersigned has an interest, including any community property interest therein. I also acknowledge that I have been advised to obtain independent counsel to represent my interests with respect to this Agreement but that I have declined to do so and I hereby expressly waive my right to such independent counsel. Date: -------------------------------- ------------------------------------- (Signature) ------------------------------------- (Print Name) EX-10.8 7 a10398exv10w8.txt EXHIBIT 10.8 EXHIBIT 10.8 CKE RESTAURANTS, INC. DEFERRED COMPENSATION PLAN EFFECTIVE JULY 1, 2005 . . . Table of Contents
Page ---- ARTICLE I PURPOSE AND EFFECTIVE DATE 1.1 Purpose................................................................1 1.2 Effective Date.........................................................1 ARTICLE II DEFINITIONS 2.1 Account................................................................1 2.2 Beneficiary............................................................1 2.3 Board of Directors.....................................................1 2.4 Change in Control......................................................1 2.5 Code...................................................................2 2.6 Committee..............................................................2 2.7 Compensation...........................................................2 2.8 Company................................................................3 2.9 Deferral Election......................................................3 2.10 Deferral Period........................................................3 2.11 Determination Date.....................................................3 2.12 Disability.............................................................3 2.13 Discretionary Contribution.............................................3 2.14 Earnings...............................................................3 2.15 Form of Payment Designation............................................3 2.16 Normal Retirement Age..................................................3 2.17 Plan...................................................................4 2.18 Participant............................................................4 2.19 Separation from Service................................................4 2.20 Termination Benefits...................................................4 2.21 Unforeseeable Emergency................................................4 ARTICLE III PARTICIPATION AND DEFERRAL ELECTIONS 3.1 Eligibility and Participation..........................................4 3.2 Form of Deferral.......................................................5 3.3 Limitations on Deferral Elections......................................5 3.4 Election Limited by Separation from Service............................5 3.5 Modification of Deferral Election......................................5 3.6 Modification of Form of Payment Designation............................5
i Table of Contents (continued)
Page ---- ARTICLE IV DEFERRED COMPENSATION ACCOUNT 4.1 Account................................................................6 4.2 Timing of Credits; Withholding.........................................6 4.3 Discretionary Contributions............................................6 4.4 Determination of Accounts..............................................6 4.5 Vesting of Accounts....................................................6 4.6 Statement of Accounts..................................................7 ARTICLE V PLAN BENEFITS 5.1 Distribution Events....................................................7 5.2 Distributions Prior to a Separation from Service.......................7 5.3 Termination Benefits Before the Attainment of Normal Retirement Age....8 5.4 Termination Benefits On or After the Attainment of Normal Retirement Age.................................................................. 8 5.5 Death Benefit..........................................................8 5.6 Form and Commencement of Distribution..................................8 5.7 Withholding; Payroll Taxes.............................................9 5.8 Valuation Date.........................................................9 5.9 Payment to Guardian...................................................10 ARTICLE VI BENEFICIARY DESIGNATION 6.1 Beneficiary Designation...............................................10 6.2 Changing Beneficiary..................................................10 6.3 Change in Marital Status..............................................10 6.4 No Beneficiary Designation............................................11 6.5 Effect of Payment.....................................................11 ARTICLE VII ADMINISTRATION 7.1 Committee; Duties.....................................................11 7.2 Agents................................................................11 7.3 Binding Effect of Decisions...........................................11 7.4 Indemnity of Committee................................................11 7.5 Election of Committee After Change in Control.........................11
ii Table of Contents (continued)
Page ---- ARTICLE VIII CLAIMS PROCEDURE 8.1 Claim.................................................................12 8.2 Denial of Claim.......................................................12 8.3 Review of Claim.......................................................12 8.4 Final Decision........................................................12 ARTICLE IX AMENDMENT AND TERMINATION OF PLAN 9.1 Amendment.............................................................12 9.2 Company's Right to Terminate..........................................13 ARTICLE X MISCELLANEOUS 10.1 Unfunded Plan.........................................................13 10.2 Company Obligation....................................................13 10.3 Unsecured General Creditor............................................14 10.4 Trust Fund............................................................14 10.5 Nonassignability......................................................14 10.6 Not a Contract of Employment..........................................14 10.7 Protective Provisions.................................................14 10.8 Governing Law.........................................................14 10.9 Validity..............................................................14 10.10 Notice................................................................14 10.11 Successors............................................................15
iii EXHIBIT 10.8 CKE RESTAURANTS, INC. DEFERRED COMPENSATION PLAN ARTICLE I PURPOSE AND EFFECTIVE DATE 1.1 Purpose. The purpose of the CKE Restaurants, Inc. Deferred Compensation Plan is to provide current tax planning to a select group of management and highly compensated employees of the Company and to non-employee directors. It is intended that the Plan will aid in attracting and retaining key employees and directors of exceptional ability by providing them with these opportunities. 1.2 Effective Date. The Plan shall be effective as of July 1, 2005. ARTICLE II DEFINITIONS For the purposes of this Plan, the following terms shall have the meanings indicated, unless the context clearly indicates otherwise: 2.1 Account. "Account" means the vehicle used by Company to measure and determine the amounts to be paid to a Participant under the Plan. 2.2 Beneficiary. "Beneficiary" means the person, persons or entity as designated by the Participant, entitled under Article VI to receive any Plan benefits payable after the Participant's death. 2.3 Board of Directors. "Board of Directors" means the Board of Directors of the Company. 2.4 Change in Control. "Change in Control" of the Company means, and shall be deemed to have occurred upon, the first to occur of any of the following events: (a) Any "Person" (other than those Persons in control of the Company as of the Effective Date, or other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company, or a corporation owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company) becomes the "Beneficial Owner," directly or indirectly, of securities of the Company representing twenty-five percent (25%) or more of the combined voting power of the Company's then outstanding securities; or (b) During any period of two (2) consecutive years after an employee becomes a Plan Participant, individuals who at the beginning of such period constitute the Board of Directors (and any new Director, whose election by the Company's stockholders was approved by a vote of at least two-thirds (2/3) of the Directors then still in office who either were Directors at the beginning of the period or whose election or nomination for election was so approved), cease for any reason to constitute a majority thereof; or (c) The stockholders of the Company approve: (i) a plan of complete liquidation of the Company; or (ii) an agreement for the sale or disposition of all or substantially all of the Company's assets; or (iii) a merger, consolidation, or reorganization of the Company with or involving any other corporation, other than a merger, consolidation, or reorganization that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least fifty percent (50%) of the combined voting power of the voting securities of the Company (or such surviving entity) outstanding immediately after such merger, consolidation, or reorganization. However, in no event shall a "Change in Control" be deemed to have occurred, with respect to the Participant, if the Participant is part of a purchasing group which consummates the Change in Control transaction. The Participant shall be deemed "part of a purchasing group" for purposes of the preceding sentence if the Participant is an equity participant in the purchasing company or group except for: (i) passive ownership of less than two percent (2%) of the stock of the purchasing company; or (ii) ownership of equity participation in the purchasing company or group which is otherwise not significant, as determined prior to the Change in Control by a majority of the non-employee continuing Directors. For purposes of this Section, the terms "Person" and "Beneficial Owner" shall have the meanings given those terms in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, and Rule 13d-3 under that Act. 2.5 Code. "Code" means the Internal Revenue Code of 1986, as amended. 2.6 Committee. "Committee" means the committee appointed by the Board of Directors to administer the Plan pursuant to Article VII. The initial committee so designated by the Board of Directors shall be its standing Compensation Committee. 2.7 Compensation. "Compensation" shall mean only: (a) the base salary payable to and any quarterly or annual bonus earned by an employee of the Company and considered to be "wages" for purposes of federal income tax withholding, and (b) the annual stipend and periodic meeting fees payable to a non-employee member of the Company's Board of Directors for the performance of directorial services. 2 Compensation does not include any other form of remuneration paid by the Corporation, including, without limitation, the amount paid in the form of an auto allowance, reimbursement for employee business expense, or any fringe benefits. Compensation shall be determined before reduction for any amounts deferred by the Participant either pursuant to the Company's tax-qualified plans, which may be established and maintained under Section 401(k) or Section 125 of the Code, or under this Plan. 2.8 Company. "Company" means CKE Restaurants, Inc., a Delaware corporation, and directly or indirectly affiliated subsidiary corporations, any other affiliate designated by the Board of Directors, or any successor to the business thereof. 2.9 Deferral Election. "Deferral Election" means a written election made by a Participant to defer a percentage of Compensation pursuant to Article III. The Deferral Election shall apply to each payment of salary, bonus and Board of Director's fees payable to a Participant. In no event shall the Deferral Election exceed eighty percent (80%) of the Participant's base salary and one hundred percent (100%) of the Participant's bonus less applicable taxes. A Deferral Election shall remain in effect until amended or revoked as provided under Section 3.2. 2.10 Deferral Period. "Deferral Period" means each calendar year. Notwithstanding the foregoing, the initial Deferral Period shall be the period commending July 1, 2005 and ending December 31, 2005. 2.11 Determination Date. "Determination Date" means the last day of each calendar quarter. 2.12 Disability. "Disability" means a condition due to which the Participant is (a) Unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or (b) by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last of a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Participant's employer. 2.13 Discretionary Contribution. "Discretionary Contribution" means the Company contribution credited to a Participant's Account under Section 4.4. 2.14 Earnings. "Earnings" means the hypothetical rate of growth credited to an Account on each Determination Date in a calendar year, which shall be equal the rate of growth that would have resulted from the investment of the Participant's Account from among a range of investment options as determined by the Committee, in its sole discretion, from time to time. 2.15 Form of Payment Designation. "Form of Payment Designation" means the form prescribed by the Committee and completed by the Participant, indicating the chosen form of payment for benefits payable under this Plan, as elected by the Participant. 2.16 Normal Retirement Age. "Normal Retirement Age" means the earliest of the following dates: (1) the later of the attainment of age sixty-five (65) and one (1) years of continuous 3 service with the Corporation, or (2) the later of the attainment of age fifty-five (55) and five (5) years of continuous service with the Corporation. 2.17 Plan. "Plan" means this CKE Restaurants, Inc. Deferred Compensation Plan, as amended from time to time 2.18 Participant. "Participant" means any employee or non-employee director who is eligible, pursuant to Section 3.1, to participate in this Plan, and who has elected to defer Compensation under this Plan. 2.19 Separation from Service. "Separation from Service" means either the Participant's termination of employment by the Company, in the case of an employee, due to voluntary quit or discharge or due to the Participant's retirement or the Participant's termination as a member of the Company's Board of Directors for any reason. 2.20 Termination Benefits. "Termination Benefits" means those benefits that are payable upon a Participant's Separation from Service as set forth in Section 5.3 below. 2.21 Unforeseeable Emergency. "Unforeseeable Emergency" means a severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Participant's spouse or a dependent (as defined in Section 152(a) of the Code) or the Participant, loss of the Participant's property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. ARTICLE III PARTICIPATION AND DEFERRAL ELECTIONS 3.1 Eligibility and Participation. (a) Eligibility. Eligibility to participate in the Plan shall be limited to (i) those select key employees of Company whose regular rate of base compensation is at least equal to the dollar amount specified in Section 414(q)(1)(b)(i) of the Code and the regulations published thereunder, and (ii) the non-employee members of the Company's Board of Directors. (b) Participation. An employee's or a director's participation in the Plan shall be effective upon notification to the employee or the director by the Committee of eligibility to participate, and completion and submission of a Deferral Election and a Form of Payment Designation to the Committee by the November 30 of the calendar year immediately preceding the beginning of the Deferral Period. Such Deferral Election and Form of Payment Designation shall remain in effect with respect to each succeeding Deferral Period, until such time as another Deferral Election is filed with the Committee as described in Section 3.2(b) below. (c) Part-Year Participation. When an individual first becomes eligible to participate during a Deferral Period, a Deferral Election may be submitted to the Committee within thirty (30) days after the Committee notifies the individual of eligibility to participate. Such Deferral 4 Election will be effective only with regard to Compensation earned following submission of the Deferral Election to the Committee. 3.2 Form of Deferral. A Participant may elect a Deferral Election as follows: (a) Form of Deferral Election. A Deferral Election shall be with respect to each payment of salary and bonus payable by Company to a Participant during the Deferral Period. (b) Period of Election. Once a Participant has made a Deferral Election, that election shall remain in effect for that Deferral Period and shall remain in effect for all future Deferral Periods unless revoked or amended in writing by the Participant and delivered to the Committee no later than November 30 of the year preceding a subsequent Deferral Period. 3.3 Limitations on Deferral Elections. The following limitations shall apply to a Deferral Election: (a) Maximum. The maximum percentage of Compensation deferred shall be eighty percent (80%) of each payment of base salary and one hundred percent (100%) of bonus payable less applicable taxes and Board of Directors fees. (b) Minimum. The minimum deferral amount for Plan Years beginning after December 31, 2005 shall be twenty-five hundred dollars ($2,500.00). The minimum deferral amount for the first short Plan Year (July 1, 2005 to December 31, 2005) shall be twelve-hundred and fifty dollars ($1,250.00). (c) The amount to be deferred shall be stated either as a sum of money in United States currency or as a full percentage of each payment of base salary or bonus amount and as a full percentage of each payment of Board of Directors fees. (d) Changes in Minimum or Maximum. The Committee may change the minimum or maximum deferral amounts from time to time by giving written notice to all Participants. No such change may affect a Deferral Election entered into prior to the Committee's action. 3.4 Election Limited by Separation from Service. If a Participant has a Separation from Service with Company prior to the end of the Deferral Period, the Deferral Period shall end as of the date of such separation. 3.5 Modification of Deferral Election. A Deferral Election shall be irrevocable by the Participant during a Deferral Period. 3.6 Modification of Form of Payment Designation. The following limitations shall apply to the modification of a Form of Payment Designation. (a) A Form of Payment Designation with respect to the distribution of benefits other than Termination Benefits may be modified by submitting a Form of Payment Designation Change Form to the Administrator at least twelve (12) months prior to the Participant's scheduled date of distribution. However, in no event shall such modification allow for the acceleration of the payment or payments that would be payable under the Form of Payment Designation then in effect. Any such modification may only extend the Deferral Period and must result in an extension of the 5 Deferral Period for at least five (5) years from the date on which payment would have commenced under the Form of Payment Designation then in effect. (b) A Form of Payment Designation with respect to the distribution of Termination Benefits is irrevocable and may not be modified. ARTICLE IV DEFERRED COMPENSATION ACCOUNT 4.1 Account. The amounts deferred by a Participant under the Plan, any Company contributions and Earnings shall be credited to the Participant's Account. Separate subaccounts may be maintained to reflect different forms of distribution. The Account shall be a bookkeeping device utilized for the sole purpose of determining the benefits payable under the Plan and shall not constitute a separate fund of assets. 4.2 Timing of Credits; Withholding. A Participant's deferred Compensation shall be credited to the Account as of the date that is five (5) business days following the date it would have been payable to the Participant. Any withholding of taxes or other amounts with respect to deferred Compensation that is required by local, state or federal law shall be withheld from the Participant's corresponding nondeferred Compensation to the maximum extent possible, and any remaining amount shall reduce the amount credited to the Participant's Account. 4.3 Discretionary Contributions. Company may make Discretionary Contributions to a Participant's Account. Discretionary Contributions shall be credited at such times and in such amounts as recommended by the Committee and approved by the Compensation Committee of the Board, or the Board in its sole discretion shall determine. 4.4 Determination of Accounts. Each Participant's Account as of each Determination Date shall consist of the balance of the Account as of the immediately preceding Determination Date, adjusted as follows: (a) New Deferrals. The Account shall be increased by any deferred Compensation credited since such Determination Date. (b) Company Contributions. The Account shall be increased by any Discretionary Contributions credited since such Determination Date. (c) Distributions. The Account shall be reduced by any benefits distributed to the Participant since such Determination Date. (d) Earnings. The Account shall be increased by the Earnings on the average daily balance in the Account since such Determination Date. 4.5 Vesting of Accounts. Each Participant shall be vested in the amounts credited to such Participant's Account and Earnings thereon as follows: (a) Amounts Deferred. A Participant shall be one hundred percent (100%) vested at all times in the amount of Compensation elected to be deferred under this Plan and Earnings thereon. 6 (b) Discretionary Contributions. A Participant's Discretionary Contributions and Earnings thereon shall become vested as determined by the Compensation Committee of the Board, or the Board. 4.6 Statement of Accounts. The Committee shall give to each Participant a statement showing the balances in the Participant's Account on a quarterly basis and at such times as may be determined by the Committee. ARTICLE V PLAN BENEFITS 5.1 Distribution Events. Amounts deferred under the Plan may not be distributed to the Participant or the Participant's beneficiary, in the event of the Participant's death, earlier than: (a) the Participant's Separation from Service, (b) the Participant's Separation from Service on or after the attainment of Normal Retirement Age, (c) the date the Participant incurs a Disability, (d) the Participant's death, (e) the occurrence of a Change in Control, (f) the occurrence of an Unforeseeable Emergency, or (g) pursuant to a fixed date or dates specified in a Deferral Election set forth in Section 5.2 below. 5.2 Distributions Prior to a Separation from Service. A Participant's Account may be distributed to the Participant before a Separation from Service occurs as follows: (a) Elective Distributions. A Participant may elect to receive a distribution of all or any portion of the Participant's Account as of a date or dates specified in a Deferral Election and the related Form of Payment Designation. (b) Unforeseeable Emergency or Disability Withdrawals. Upon a written request by the Participant and a finding that the Participant has suffered an Unforeseeable Emergency or Disability, which the Committee shall determine in its sole discretion, the Committee may make distributions from the Participant's Account. The amount of such distribution shall be limited to the amount reasonably necessary to meet the Participant's needs resulting from the Unforeseeable Emergency or Disability, and will not exceed the Participant's Account balance. If payment is made due to Unforeseeable Emergency, the Participant's deferrals under this Plan shall cease for a twelve (12)-month period. Any resumption of the Participant's deferrals under the Plan after such twelve (12)-month period shall be made only at the election of the Participant in accordance with Article III herein. 7 (c) Small Account. Notwithstanding the form of payment set forth in the Participant's Form of Payment Designation, if the value of the Participant's Account is less than ten thousand dollars ($10,000) on the Valuation Date as defined in Section 5.8(b), the benefit shall be paid in a lump sum. 5.3 Termination Benefits Before the Attainment of Normal Retirement Age. (a) Form of Payment. If a Participant has a Separation from Service with Company before the attainment of the Normal Retirement Age for any reason other than death, Company shall distribute the Participant's Account in the manner specified in the related Form of Payment Designation. The number of annual installment payments may not exceed five (5). (b) Small Account. Notwithstanding the form of payment set forth in the Participant's Form of Payment Designation, if the value of the Participant's Account is less than ten thousand dollars ($10,000) on the Valuation Date as defined in Section 5.8(a), the benefit shall be paid in a lump sum. 5.4 Termination Benefits On or After the Attainment of Normal Retirement Age. (a) Form of Payment. If a Participant has a Separation from Service with Company, on or after the attainment of the Normal Retirement Age, for any reason other than death, Company shall distribute the Participant's Account in the manner specified in the related Form of Payment Designation. The number of annual installment payments may not exceed fifteen (15). (b) Small Account. Notwithstanding the form of payment set forth in the Participant's Form of Payment Designation, if the value of the Participant's Account is less than fifty thousand dollars ($50,000) on the Valuation Date as defined in Section 5.8(a), the benefit shall be paid in a lump sum. 5.5 Death Benefit. Upon the death of a Participant, Company shall pay to the Participant's Beneficiary the value of the Participant's Account in a lump sum. 5.6 Form and Commencement of Distribution. (a) Distributions payable under Sections 5.2 above shall be paid in the form specified by the Participant in the applicable Form of Payment Designation unless the benefit is based on a Small Account as defined in paragraph (c) therein. (b) Optional forms of benefit payment payable under Section 5.2 are: (i) a lump sum amount which is equal to the value of the Participant's Account, and (ii) equal annual installments of the Participant's Account balance amortized over a period not to exceed five (5) years. (c) Distributions payable under Section 5.3 above shall be paid in the form specified by the Participant in the applicable Form of Payment Designation unless the benefit is based on a Small Account as defined in paragraph (b) therein. 8 (d) Optional forms of benefit payment payable under Section 5.3 are: (i) a lump sum amount which is equal to the value of the Participant's Account, and (ii) equal annual installments of the Participant's Account balance amortized over a period not to exceed five (5) years. (e) Distributions payable under Section 5.4 above shall be paid in the form specified by the Participant in the applicable Form of Payment Designation unless the benefit is based on a Small Account as defined in paragraph (b) therein. (f) Optional forms of benefit payment payable under Section 5.4 are: (i) a lump sum amount which is equal to the value of the Participant's Account, and (ii) equal annual installments of the Participant's Account balance amortized over a period not to exceed fifteen (15) years. 5.7 Withholding; Payroll Taxes. Company shall withhold from payments hereunder any taxes required to be withheld from such payments under local, state or federal law. A Beneficiary, however, may elect not to have withholding of federal income tax pursuant to Section 3405(a)(2) of the Code, or any successor provision thereto. 5.8 Valuation Date. The following limitations shall apply to the valuation of benefits under the Plan. (a) Termination Benefits. (i) The Valuation Date for Termination Benefits shall be the last day of the calendar quarter in which the employee's Separation from Service occurs. The amount of a lump sum payment and the initial amount of installments shall be based on the value of the Participant's Account on the Valuation Date. With regard to installment payments, each September 30 during the payment period shall constitute a new Valuation Date. (ii) All amounts payable in installments shall be made as soon as administratively practicable as of the first day of each period for which an installment is due. Notwithstanding the foregoing, with respect to Termination Benefits that are payable to Participants who are "Key Employees," as defined in Section 416(i) of the Code, the Valuation Date shall be the last day of the calendar month in which the six-month anniversary of the Participant's Separation from Service occurs and the Settlement Date shall the earliest date on which distribution is administratively practicable following such Valuation Date. (b) Benefits other than Termination Benefits. The Valuation Date for benefits other than Termination Benefits shall be the last day of the calendar year preceding the date of distribution selected by the employee in the applicable Deferral Election. With regard to installment payments, each September 30 during the payment period shall constitute a new Valuation Date. 9 5.9 Payment to Guardian. If a benefit under the Plan is payable to a minor or a person declared incompetent or to a person incapable of handling the disposition of property, the Committee may direct payment to the guardian, legal representative or person having the care and custody of such minor, incompetent or person. The Committee may require proof of incompetency, minority, incapacity or guardianship as it may deem appropriate prior to distribution. Such distribution shall completely discharge the Committee and Company from all liability with respect to such benefit. ARTICLE VI BENEFICIARY DESIGNATION 6.1 Beneficiary Designation. Each Participant shall have the right, at any time, to designate one (1) or more persons or entity as Beneficiary (both primary as well as secondary) to whom benefits under this Plan shall be paid in the event of Participant's death prior to complete distribution of the Participant's Account. Each Beneficiary designation shall be in a written form prescribed by the Committee and shall be effective only when filed with the Committee during the Participant's lifetime. Designation by a married Participant to the Participant's spouse of less than a fifty percent (50%) interest in the benefit due shall not be effective unless the spouse executes a written consent that acknowledges the effect of the designation, or it is established that the consent cannot be obtained because the spouse cannot be located. 6.2 Changing Beneficiary. Any Beneficiary designation may be changed by an unmarried Participant without the consent of the previously named Beneficiary by the filing of a new Beneficiary designation with the Committee. A married Participant's Beneficiary designation may be changed by a Participant with the consent of the Participant's spouse as provided for in Section 6.1 above, by the filing of a new Beneficiary designation with the Committee. The filing of a new designation shall cancel all designations previously filed. 6.3 Change in Marital Status. If the Participant's marital status changes after the Participant has designated a Beneficiary, the following shall apply: (a) If the Participant is married at death but was unmarried when the designation was made, the designation shall be void unless the spouse has consented to it in the manner prescribed in Section 6.1 above. (b) If the Participant is unmarried at death but was married when the designation was made: (i) The designation shall be void if the spouse was named as Beneficiary. (ii) The designation shall remain valid if a non-spouse Beneficiary was named. (c) If the Participant was married when the designation was made and is married to a different spouse at death, the designation shall be void unless the new spouse has consented to it in the manner prescribed in Section 6.1 above. 10 6.4 No Beneficiary Designation. If any Participant fails to designate a Beneficiary in the manner provided above, if the designation is void, or if the Beneficiary designated by a deceased Participant dies before the Participant or before complete distribution of the Participant's benefits, the Participant's Beneficiary shall be the person in the first of the following classes in which there is a survivor: (a) the Participant's surviving spouse; (b) the Participant's children in equal shares, except that if any of the children predeceases the Participant but leaves issue surviving, then such issue shall take by right of representation the share the deceased child would have taken if living; or (c) the Participant's estate. 6.5 Effect of Payment. Payment to the Beneficiary shall completely discharge the Company's obligations under this Plan. ARTICLE VII ADMINISTRATION 7.1 Committee; Duties. This Plan shall be administered by the Committee, except after a Change in Control as provided in Section 7.5 below. The Committee shall have the authority to make, amend, interpret and enforce all appropriate rules and regulations for the administration of the Plan and decide or resolve any and all questions, including interpretations of the Plan, as may arise in such administration. A majority vote of the Committee members shall control any decision. Members of the Committee may be Participants under this Plan. 7.2 Agents. The Committee may, from time to time, employ agents and delegate to them such administrative duties as it sees fit, and may from time to time consult with counsel who may be counsel to the Company. 7.3 Binding Effect of Decisions. The decision or action of the Committee with respect to any question arising out of or in connection with the administration, interpretation and application of the Plan and the rules and regulations promulgated hereunder shall be final, conclusive and binding upon all persons having any interest in the Plan. 7.4 Indemnity of Committee. The Company shall indemnify and hold harmless the members of the Committee against any and all claims, loss, damage, expense or liability arising from any action or failure to act with respect to this Plan on account of such member's service on the Committee, except in the case of gross negligence or willful misconduct. 7.5 Election of Committee After Change in Control. After a Change in Control, vacancies on the Committee shall be filled by majority vote of the remaining Committee members and Committee members may be removed only by such a vote. If no Committee members remain, a new Committee shall be elected by majority vote of the Participants in the Plan immediately preceding such Change in Control. No amendment shall be made to Article VII or other Plan provisions regarding Committee authority with respect to the Plan without prior approval by the Committee. 11 ARTICLE VIII CLAIMS PROCEDURE 8.1 Claim. Any person or entity claiming a benefit, requesting an interpretation or ruling under the Plan (hereinafter referred to as "Claimant"), or requesting information under the Plan shall present the request in writing to the Committee, which shall respond in writing as soon as practicable. 8.2 Denial of Claim. If the claim or request is denied, the written notice of denial shall state: (a) the reasons for denial, with specific reference to the Plan provisions on which the denial is based; (b) a description of any additional material or information required and an explanation of why it is necessary; and (c) an explanation of the Plan's claim review procedure. 8.3 Review of Claim. Any Claimant whose claim or request is denied or who has not received a response within sixty (60) days may request a review by notice given in writing to the Committee. Such request must be made within sixty (60) days after receipt by the Claimant of the written notice of denial, or in the event Claimant has not received a response sixty (60) days after receipt by the Committee of Claimant's claim or request. The claim or request shall be reviewed by the Committee which may, but shall not be required to, grant the Claimant a hearing. On review, the Claimant may have representation, examine pertinent documents, and submit issues and comments in writing. 8.4 Final Decision. The decision on review shall normally be made within sixty (60) days after the Committee's receipt of Claimant's claim or request. If an extension of time is required for a hearing or other special circumstances, the Claimant shall be notified and the time limit shall be one hundred twenty (120) days. The decision shall be in writing and shall state the reasons and the relevant Plan provisions. All decisions on review shall be final and bind all parties concerned. ARTICLE IX AMENDMENT AND TERMINATION OF PLAN 9.1 Amendment. The Board of Directors may at any time amend the Plan by written instrument, notice of which is given to all Participants and to Beneficiaries receiving installment payments, subject to the following: (a) Preservation of Account. No amendment shall reduce the amount accrued in any Account to the date such notice of the amendment is given. (b) Changes in Earnings Rate. No amendment shall reduce, either prospectively or retroactively, the rate of Earnings to be credited to the amount already accrued in Participant's 12 Account and any amounts credited to the Account under Deferral Elections already in effect on that date. 9.2 Company's Right to Terminate. The Board of Directors may at any time partially or completely terminate the Plan if, in its judgment, the tax, accounting or other effects of the continuance of the Plan, or potential payments thereunder would not be in the best interests of Company. (a) Partial Termination. The Board of Directors may partially terminate the Plan by instructing the Committee not to accept any additional Deferral Elections. If such a partial termination occurs, the Plan shall continue to operate and be effective with regard to Deferral Elections entered into prior to the effective date of such partial termination. (b) Complete Termination. The Board of Directors may completely terminate the Plan by instructing the Committee not to accept any additional Deferral Elections, and by terminating all ongoing Deferral Elections. In the event of complete termination, the Plan shall cease to operate and Company shall pay out each Account. Notwithstanding any Form of Payment Designation then effect, distributions shall be made as a lump sum or in equal monthly installments over the following period, as determined by the Committee in its sole discretion and based on the Participant's Account balance:
ACCOUNT BALANCE PAYOUT PERIOD Less than $50,000 Lump sum $50,000 but not more than $100,000 2 Years $100,000 or more 5 Years
Earnings shall continue to be credited on the unpaid balance in each Account until the Account has been completed distributed. ARTICLE X MISCELLANEOUS 10.1 Unfunded Plan. This plan is an unfunded plan maintained primarily to provide deferred compensation benefits for a select group of "management or highly-compensated employees" within the meaning of Sections 201, 301 and 401 of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and therefore is exempt from the provisions of Parts 2, 3 and 4 of Title I of ERISA. Accordingly, the Board of Directors may terminate the Plan and make no further benefit payments or remove certain employees as Participants if it is determined by the United States Department of Labor, a court of competent jurisdiction, or an opinion of counsel that the Plan constitutes an employee pension benefit plan within the meaning of Section 3(2) of ERISA (as currently in effect or hereafter amended) which is not so exempt. 10.2 Company Obligation. The obligation to make benefit payments to any Participant under the Plan shall be an obligation solely of the Company with respect to the deferred Compensation receivable from, and contributions by, that Company and shall not be an obligation of another Company. 13 10.3 Unsecured General Creditor. Except as provided in Section 10.4, Participants and Beneficiaries shall be unsecured general creditors, with no secured or preferential right to any assets of Company or any other party for payment of benefits under this Plan. Any property held by Company for the purpose of generating the cash flow for benefit payments shall remain its general, unpledged and unrestricted assets. Company's obligation under the Plan shall be an unfunded and unsecured promise to pay money in the future. 10.4 Trust Fund. Company shall be responsible for the payment of all benefits provided under the Plan. At its discretion, Company may establish one (1) or more trusts, with such trustees as the Board of Directors may approve, for the purpose of providing for the payment of such benefits. Although such a trust shall be irrevocable, its assets shall be held for payment of all Company's general creditors in the event of insolvency. To the extent any benefits provided under the Plan are paid from any such trust, Company shall have no further obligation to pay them. If not paid from the trust, such benefits shall remain the obligation of Company. 10.5 Nonassignability. Neither a Participant nor any other person shall have any right to commute, sell, assign, transfer, pledge, anticipate, mortgage or otherwise encumber, transfer, hypothecate or convey in advance of actual receipt the amounts, if any, payable hereunder, or any part thereof, which are, and all rights to which are, expressly declared to be unassignable and non-transferable. No part of the amounts payable shall, prior to actual payment, be subject to seizure or sequestration for the payment of any debts, judgments, alimony or separate maintenance owed by a Participant or any other person, nor be transferable by operation of law in the event of a Participant's or any other person's bankruptcy or insolvency. 10.6 Not a Contract of Employment. This Plan shall not constitute a contract of employment between Company and the Participant. Nothing in this Plan shall give a Participant the right to be retained in the service of Company or to interfere with the right of Company to discipline or discharge a Participant at any time. 10.7 Protective Provisions. A Participant will cooperate with Company by furnishing any and all information requested by Company, in order to facilitate the payment of benefits hereunder, and by taking such physical examinations as Company may deem necessary and taking such other action as may be requested by Company. 10.8 Governing Law. The provisions of this Plan shall be construed and interpreted according to the laws of the State of California, except as preempted by federal law. 10.9 Validity. If any provision of this Plan shall be held illegal or invalid for any reason, said illegality or invalidity shall not affect the remaining parts hereof, but this Plan shall be construed and enforced as if such illegal and invalid provision had never been inserted herein. 10.10 Notice. Any notice required or permitted under the Plan shall be sufficient if in writing and hand delivered or sent by registered or certified mail. Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification. Mailed notice to the Committee shall be directed to the Company's address. Mailed notice to a Participant or Beneficiary shall be directed to the individual's last known address in Company's records. 14 10.11 Successors. The provisions of this Plan shall bind and inure to the benefit of Company and its successors and assigns. The term successors as used herein shall include any corporate or other business entity which shall, whether by merger, consolidation, purchase or otherwise acquire all or substantially all of the business and assets of Company, and successors of any such corporation or other business entity. CKE RESTAURANTS, INC. Dated: __________________ By:_______________________________________ 15 -----END PRIVACY-ENHANCED MESSAGE-----