1
Exhibit 10.1
UNIQUE CASUAL RESTAURANTS, INC.
One Corporate Place
00 Xxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxxxxxx 00000-0000
March 10, 1999
PRIVATE AND CONFIDENTIAL
Atticus Partners, L.P.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This letter agreement confirms our mutual understanding concerning
certain matters related to (i) the solicitation of proxies by Atticus Partners,
L.P. (the "Stockholder") in connection with the 1998 Annual Meeting of
Stockholders (the "1998 Annual Meeting") of Unique Casual Restaurants, Inc., a
Delaware corporation (the "Company"), (ii) the appointment of Xxxxxxx X.
Xxxxxxxx ("Xxxxxxxx") and Xxxxx X. Xxxxxxx (together with Barakett, the "Atticus
Designees") to the Company's Board of Directors and (iii) the election of
Directors at the 1998 Annual Meeting.
In consideration of the mutual covenants and agreements herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. REPRESENTATIONS AND WARRANTIES.
(a) The Stockholder and each Atticus Designee hereby
represents and warrants with respect to itself or himself that this letter
agreement has been duly executed and delivered by the Stockholder or such
Atticus Designee, as the case may be, and that this letter agreement is a valid
and binding obligation of the Stockholder or such Atticus Designee, as the case
may be, enforceable against the Stockholder or such Atticus Designee, as the
case may be, in accordance with its terms.
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Atticus Partners, L.P.
March 10, 1999
Page 2
(b) The Company hereby represents and warrants that this
letter agreement has been duly executed and delivered by the Company and that
this letter agreement is a valid and binding obligation of the Company
enforceable against the Company in accordance with its terms.
(c) Messrs. E.L. Cox, Xxxx X. Xxxxxxxx and Xxxxxx X. X'Xxxxxxx
and Xx. Xxxxxx hereby represents and warrants with respect to himself or herself
that this letter agreement has been duly executed and delivered by such Director
and that their personal agreement set forth in Section 3(f) hereof is a valid
and binding obligation of such Director enforceable against such Director in
accordance with its terms. Messrs. Cox, Xxxxxx X. Xxxxx, Xxxxxxxx and X'Xxxxxxx
and Xx. Xxxxxx shall hereafter be referred to as the "Continuing Directors."
(d) Barakett hereby represents and warrants that as of the
record date with respect to the 1998 Annual Meeting currently called for March
17, 1999 (the "1998 Meeting") and as of the date hereof: (i) he was and is the
beneficial owner (as determined in accordance with the Rule 13d-3 promulgated
under the Securities Exchange Act of 1934 (the "1934 Act")) of 1,908,506 shares
of the Company's Common Stock; and (ii) except for such shares, neither Barakett
nor any of his affiliates beneficially owns any voting securities, or any
securities convertible into or exchangeable for any voting securities, or
options, warrants, contractual rights or other rights of any kind to acquire or
vote any voting securities or any securities convertible into or exchangeable
for any voting securities of the Company.
2. 1998 MEETING. The Company agrees that it will hold the 1998
Annual Meeting prior to April 15, 1999.
3. COMPOSITION OF BOARD OF DIRECTORS.
(a) The Company agrees that it will, concurrently herewith,
duly adopt a resolution to increase the size of the Board of Directors to seven
(7) members pursuant to Article II, Section 2 of the Company's By-Laws and to
appoint as Class I Directors of the Company pursuant to Article II, Section 3 of
the Company's By-Laws, the Atticus Designees. The Company further agrees that it
will not, prior to the 1999 Annual Meeting, take any action to increase the size
of the Board of Directors to more than seven (7) members.
(b) The Company agrees that if at any time an Atticus Designee
(including Messrs. Barakett and Xxxxxxx or their successors) shall leave his
position on the Board of Directors, whether through resignation or otherwise,
other than a result of the failure of such Atticus Designee to be elected as a
member of the Company's Board of Directors at a duly called
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Atticus Partners, L.P.
March 10, 1999
Page 3
and held meeting of the Company's stockholders, the Stockholder shall have the
power to nominate the successor of such departing Atticus Designee to serve out
the remainder of the term of such departing Atticus Designee. Upon such
nomination, the Chairman of the Board shall call a meeting of the Board of
Directors for the purpose of appointing such nominee and the remaining Atticus
Designee and the Continuing Directors agree to vote to appoint such nominee to
the Board of Directors.
(c) The Atticus Designees and the Stockholder agree that if at
any time a Continuing Director (including Messrs. Cox, Schwartz, Xxxxx or
X'Xxxxxxx or Xx. Xxxxxx or their successors) shall leave his or her position on
the Board of Directors, whether through resignation or otherwise, other than a
result of the failure of such Continuing Director to be elected as a member of
the Company's Board of Directors at a duly called and held meeting of the
Company's stockholders, the Continuing Directors, acting by majority vote, shall
have the power to nominate designate the successor of such departing Continuing
Director to serve out the remainder of the term of such departing Continuing
Director. Upon such nomination, the Chairman of the Board shall call a meeting
of the Board of Directors for the purpose of appointing such nominee and the
Atticus Designees and the Continuing Directors agree to vote to appoint such
nominee to the Board of Directors.
(d) Each of the Atticus Designees and the Stockholder hereby
agrees (i) to cooperate with the Company in the preparation of its proxy
statement relating to the 1998 Meeting in accordance with the 1934 Act and the
rules and regulations under the 1934 Act and (ii) promptly to provide the
Company with any and all information required or necessary pursuant to Schedule
14A of Rule 14a-101 promulgated under the 1934 Act.
(e) The Company agrees that the Board of Directors shall
establish a committee of the Board of Directors (the "Strategic Committee")
pursuant to Article II, Section 12 of the ByLaws of the Company to consist of
two (2) directors, which initially shall be Xxxxxxx X. Xxxxxxxx (the "Atticus
Representative") and Xxxx X. Xxxxxxxx (the "Continuing Board Representative").
The Board of Directors shall delegate to the Strategic Committee the exclusive
power and authority to (i) control and/or oversee the negotiation, preparation
and performance of any agreement with respect to a sale, merger or other
business combination involving the Company (a "Sale Transaction") and provide a
recommendation to the full Board of Directors concerning any potential Sale
Transaction, provided that the Company shall not in any event enter into a
definitive agreement with respect to a Sale Transaction without the approval of
the full Board of Directors and (ii) review and evaluate the Company's executive
officers in light of the Company's strategic needs and objectives and take
action in connection therewith, including entering into,
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Atticus Partners, L.P.
March 10, 1999
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amending or terminating employment agreements and related matters with respect
to duties, responsibilities, terms of employment and the like. The size and
composition of the Strategic Committee can only be changed by the full Board of
Directors of the Company acting with the approval of a Required Majority of
Directors. For purposes of this letter agreement, "Required Majority" shall
mean: (x) four (4) Directors, if the Board of Directors consists of five (5)
members, and (y) six (6) Directors, if the Board of Directors consists of seven
(7) members. The Strategic Committee shall conduct business strictly in
accordance withe the following rules, which can only be amended by the full
Board of Directors of the Company acting with the approval of a Required
Majority of Directors:
(A) MEETINGS. Meetings of the Strategic Committee may be called by
either member of the committee orally or in writing and
members may participate by means of conference telephone in
accordance with Article II, Section 7 of the By-Laws of the
Company.
(B) QUORUM. At any meeting of the Strategic Committee both members
of the committee shall constitute a quorum and under no
circumstances shall a quorum exist at any meeting, including
an adjourned meeting, with or without notice, unless both
members of the committee are present.
(C) ACTION. At any meeting of the Strategic Committee at which a
quorum is present, action may only be taken with the approval
of both members of the committee. No action may be taken by
the Strategic Committee without a meeting.
(D) DEADLOCKED COMMITTEE. If the Strategic Committee is not able
to hold a meeting due to the lack of a quorum or is not able
to act at a meeting due to the lack of approval of the
proposed action by one of the members of the committee, either
member of the Strategic Committee may request that the
Chairman call a meeting of the full Board of Directors to
consider and/or act upon the matter to be considered and/or
acted upon by the Strategic Committee, and the Chairman shall
be obligated to call such a meeting as soon as reasonably
practicable in accordance with Article II of the By-Laws of
the Company to consider and/or act on such matter.
(E) REMOVAL; VACANCIES. If at any time the Atticus Representative
shall leave his position on the Strategic Committee, whether
through resignation or otherwise, the remaining Atticus
Designees shall have the power to nominate a replacement
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Atticus Partners, L.P.
March 10, 1999
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Atticus Representative selected among the Atticus Designees.
Upon such nomination, the Chairman of the Board of Directors
shall call a meeting of the Board of Directors for the purpose
of appointing such successor Atticus Representative and the
Continuing Directors and the Atticus Designees agree to vote
to appoint such successor Atticus Representative. If at any
time the Continuing Board Representative shall leave his
position on the Strategic Committee, whether through
resignation or otherwise, a majority of the Continuing
Directors shall have the power to nominate a replacement
Continuing Board Representative selected from among the
Continuing Directors. Upon such nomination, the Chairman of
the Board of Directors shall call a meeting of the Board of
Directors for the purpose of appointing such successor
Continuing Board Representative and the Continuing Directors
and the Atticus Designees agree to vote to appoint such
successor Continuing Board Representative.
(f) The Company agrees that, in the event that (i) on or
before May 31, 1999 ("Target Date") the Company does not enter into a definitive
agreement with respect to a Sale Transaction or (ii) any such definitive
agreement is terminated by any party for any reason prior to consummation of the
Sale Transaction (either event described in clause (i) or (ii) being referred to
herein as a "Triggering Event"), as promptly as practicable after the date of
the Triggering Event the Board of Directors will duly adopt a resolution to
reduce the number of members of the Company's Board of Directors to five (5) and
will not thereafter take any action to increase the size of the Company's Board
of Directors to more than five (5) members unless such increase is approved by
the full Board of Directors of the Company acting with the approval of a
Required Majority of Directors. The Target Date may be extended one or more
times without limitation by the Strategic Committee. If after the occurrence of
a Triggering Event the Board of Directors is reduced to five (5) members, two
(2) of the Continuing Directors (or such lesser number as may be necessary to
reduce the size of the Board of Directors to five (5) members) selected by a
majority of the Continuing Directors (or failing such selection, selected by Xx.
Xxx as Chairman) shall voluntarily resign, effective as of the date of the
Triggering Event, as members of the Board of Directors. Each of Messrs. Cox,
Xxxxxxxx and X'Xxxxxxx and Xx. Xxxxxx hereby agree that, if requested to resign
in accordance with the foregoing sentence, they shall immediately tender their
resignation to the Company.
(g) With respect to Sections 2(a) and 2(f) hereof, the Company
agrees that it will, immediately upon the appointment of the Atticus Designees
to the Board of Directors, amend: (i) Article II, Section 2 of its Amended and
Restated By-laws (the "By-laws") to provide that the size of the Board of
Directors shall not exceed seven (7) members and that, upon the taking of any
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Atticus Partners, L.P.
March 10, 1999
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action pursuant to Section 2(f) hereof to reduce the size of the Board of
Directors to five (5) members, the size of the Board of Directors shall not
exceed five (5) members; and (ii) Article VI, Section 7(a) of the By-laws to
provide that Article II, Section 2 of the Bylaws may not be amended except by
the full Board of Directors acting with the approval of a Required Majority of
Directors.
4. STOCKHOLDER NOMINATIONS. The Stockholder hereby withdraws any and
all nominations of candidates for election as Directors of the Company at the
1998 Meeting previously submitted to the Company. Barakett and his affiliates
agree not to submit or cause the submission of any proposals or nominations of
candidates for election as Directors of the Company at the 1998 Meeting, and no
nominees thereof shall be placed on the ballot or otherwise considered at the
1998 Meeting. Effective immediately, the Stockholder shall terminate any
"solicitation" (as such term is defined in the proxy rules of the Securities and
Exchange Commission) of proxies with respect to the 1998 Meeting. With respect
to all proxies solicited to date by or on behalf of the Stockholder, the
Stockholder agrees not to vote, deliver or otherwise use, or attempt to vote,
deliver or use, such proxies. Xx. Xxxxxxxx and his affiliates hereby agree not
to solicit any proxies from the date hereof with respect to the 1998 Meeting,
except on behalf of the Company.
5. AGREEMENT NOT TO XXX. Each of the Atticus Representatives and the
Stockholder hereby agree to waive his, her or its right to challenge the change
in the number and the identity of directors to be nominated at the 1998 Meeting
as set forth herein. Each of the Atticus Representatives and the Stockholder
further hereby agrees to forbear from commencing any and all civil litigation
against the Company relating to the change described in the preceding sentence.
Notwithstanding the foregoing, the terms of this Section shall not limit the
right of the parties hereto to enforce their respective rights under this letter
agreement.
6. VOTING. Barakett hereby agrees that he will (i) vote or cause to be
voted all shares of the Company's Common Stock beneficially owned by him or over
which he exercises voting control for the election of the nominees designated by
the Board of Directors with respect to the 1998 Annual Meeting (Xx. Xxxxxx and
Xx. X'Xxxxxxx); and (ii) if requested by the Company, take all reasonable
actions to ensure that he carries out his obligations under this Section 6
including, without limitation, delivering signed proxies for all shares of
Common Stock owned beneficially by Barakett to the Company's designees to be
voted by such designees in accordance with the terms of clause (i) of this
Section 6 at the 1998 Meeting and/or execute such other documents as the Company
may reasonably request in order to confirm that he has complied with his
obligations under this Section 6.
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Atticus Partners, L.P.
March 10, 1999
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7. EXPENSES. Simultaneously with the execution and delivery of
this letter agreement, the Company is delivering to the Stockholder a check in
the amount of $150,000 made payable to Atticus Capital, LLC for the benefit of
the Stockholder and its affiliates as a group as reimbursement for a portion of
the out-of-pocket fees and expenses incurred by the Stockholder and its
affiliates to date in connection with their solicitation of the Company's
stockholders. The Stockholder agrees that the payment referred to above shall
constitute payment in full by the Company with respect to any fees or expenses
incurred or to be incurred by or on behalf of the Stockholder and the Atticus
Designees in connection with the matters referred to in this letter agreement,
including without limitation any Sale Transaction and the operation of the
Strategic Committee.
8. PUBLIC ANNOUNCEMENT; PUBLICITY.
(a) The Company and the Atticus Designees shall consult with
each other before issuing any press release or otherwise making any public
statements or making any filing with the Securities and Exchange Commission,
including, without limitation, a Current Report on Form 8-K or a Schedule 13D,
with respect to this letter agreement and the matters contemplated herein and
shall not issue any such press release or make any such public statement or
filing with the Securities and Exchange Commission with respect to this letter
agreement and the matters contemplated herein without the prior consent of (i) a
majority of the Continuing Directors and (ii) the Atticus Designees, which
consents in each case shall not be unreasonably withheld; provided, however,
that either the Company or the Stockholder or any of their respective affiliates
may, without the prior consent of the other persons, as the case may be, issue
such press release or make such public statement or filing with the Securities
Exchange Commission with respect to this letter agreement and the matters
contemplated herein as may be required by law or the applicable rules of Nasdaq
if it has used its best efforts to consult with such other person and to obtain
such other person's consent but has been unable to do so in a timely manner. In
this regard, the Company shall after consultation with and the consent of the
Stockholder, make a public announcement of the matters contemplated by this
letter agreement no later than (i) the close of trading on the Nasdaq Stock
Market on the day this letter agreement is signed, if such signing occurs during
the business day or (ii) the opening of trading on the Nasdaq Stock Market on
the business day following the date on which this Agreement is signed, if such
signing does not occur during the business day.
(b) None of Barakett, the Stockholder, or his or its
affiliates (collectively, "Atticus"), on the one hand, or the Company or any of
its directors, officers, employees and affiliates (collectively, "Unique"), on
the other hand, shall, directly or indirectly make or issue
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Atticus Partners, L.P.
March 10, 1999
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or cause to have made or issued any disclosure, announcement or statement
concerning Unique or Atticus, respectively, which portrays Unique or Atticus,
respectively, in an unfavorable light and (a) which is made or issued or caused
to be made or issued to the general public or to stockholders of the Company or
(b) which is made or issued or caused to be made or issued under circumstances
reasonably likely to result in the dissemination thereof to the general public
or to stockholders of the Company. The provisions of this paragraph (b) shall
not apply to statements made in connection with a solicitation of the Company's
stockholders with respect to the Company's 1999 Annual Meeting of Stockholders,
provided that such statements are made after October 1, 1999.
9. REMEDIES. It is understood and agreed that money damages would
not be a sufficient remedy for any breach of this letter agreement by any of the
parties hereto or any of their respective affiliates or representatives, and
that in addition to all other remedies available at law or equity, all of the
parties hereto shall be entitled to equitable relief, including injunction and
specific performance, as a remedy for any such breach by any of the other
parties hereto or their respective affiliates or representatives, and each of
the parties hereto further agrees to waive any requirement for the securing or
posting of any bond in connection with such remedy.
10. WAIVERS; AMENDMENT. No failure or delay by any party hereto in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise thereof preclude any other or
future exercise thereof or the exercise of any other right, power or privilege
hereunder. No provision of this letter agreement can be amended without the
specific written consent of the Company acting with the approval of a majority
of the Continuing Directors and the Stockholder.
11. NOTICES. For purposes of this letter agreement, notices and
all other communications to any party hereunder shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
certified or registered mail, return receipt requested, postage prepaid, to the
respective addresses of the Company and each of the Atticus Stockholders set
forth on page one of this letter agreement, or to such other address as any
party shall designate by giving written notice of such change to the other
parties hereto.
12. GOVERNING LAW. This letter agreement shall be governed and
construed in accordance with the laws of the State of Delaware without regard to
any applicable principles of conflicts of law. Each of the parties hereto
irrevocably and unconditionally consents to the sole and exclusive jurisdiction
of the courts of the State of Delaware and the United States District Court for
the District of Delaware for any action, suit or proceeding arising out of or
relating to
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Atticus Partners, L.P.
March 10, 1999
Page 9
this letter agreement or the terms thereof, and agrees not to commence any
action, suit or proceeding related thereto except in such courts. Each of the
parties hereto further hereby irrevocably and unconditionally waives any
objection to the laying of venue of any lawsuit, claim or other proceeding
arising out of or relating to this letter agreement in the courts of the State
of Delaware or the United States District Court for the District of Delaware,
and hereby further irrevocably and unconditionally waive and agree not to plead
or claim in any such court that any such lawsuit, claim or other proceeding
brought in any such court has been brought in an inconvenient forum. Each of the
parties hereto further agrees that service of any process, summons, notice or
document by U.S. registered mail to its address set forth above (with a copy to
the persons at the addresses listed below) shall be effective service of process
for any action, suit or proceeding brought against it in any such court.
The Company: Unique Casual Restaurants, Inc.
Xxx Xxxxxxxxx Xxxxx
00 Xxxxxxxxx Xxxx
Xxxxxxx, XX 00000-0000
Attn: General Counsel
with a copy to: Xxxxxxx, Procter & Xxxx XXX
Xxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxx, P.C.
The Stockholder Atticus Capital LLC
or the Atticus 000 Xxxxxxx Xxxxxx, 00xx Floor
Representatives: Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxxxxxx
with a copy to: Xxxxxxxxxx & Xxxxx LLP
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxxxx, Esq.
13. ENFORCEABILITY. This letter agreement shall inure to the
benefit of and be enforceable by each of the parties hereto and their respective
successors.
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Atticus Partners, L.P.
March 10, 1999
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14. SEVERABILITY. In case provisions of this letter agreement
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions of the letter agreement shall not in
any way be affected or impaired thereby.
15. COUNTERPARTS; FACSIMILE SIGNATURE. This letter agreement may
be executed in two or more counterparts, each of which shall be deemed an
original, but all of which shall constitute the same agreement. This letter
agreement may be executed by facsimile signature, which shall be deemed an
original.
16. HEADINGS. The descriptive headings herein are inserted for
convenience only and are not intended to be part of or to affect the meaning or
interpretation of this letter agreement.
17. ENTIRE AGREEMENT. This letter agreement and the schedules
hereto contain the entire understanding of the parties with respect to the
subject matter hereof and may be amended only by an agreement in writing
executed by the parties.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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Atticus Partners, L.P.
March 10, 1999
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Please confirm your agreement with the foregoing by signing and
returning one copy of this letter agreement to the undersigned, whereupon this
letter agreement shall become a binding agreement among all of the parties
hereto upon receipt of the signatures of all of the parties hereto.
Very truly yours,
UNIQUE CASUAL RESTAURANTS,
INC.
By: /s/ E. L. Cox
-----------------------------
E. L. Cox
Chairman of the Board of Directors
ATTICUS PARTNERS, L.P.
By: Atticus Holdings, LLC
its general partner
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------
Xxxxxxx X. Xxxxxxxx
Managing Member
/s/ Xxxxxxx X. Xxxxxxxx
---------------------------------
Xxxxxxx X. Xxxxxxxx
/s/ Xxxxx X. Xxxxxxx
---------------------------------
Xxxxx X. Xxxxxxx
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ONLY FOR PURPOSES OF SECTIONS 1(c) AND 3(f) HEREOF:
/s/ E.L. Cox
----------------------------------
E.L. Cox
/s/ Xxxxxx Xxxxxx
----------------------------------
Xxxxxx Xxxxxx
/s/ Xxxxxx X. X'Xxxxxxx
----------------------------------
Xxxxxx X. X'Xxxxxxx
/s/ Xxxx X. Xxxxxxxx
----------------------------------
Xxxx X. Xxxxxxxx
