Exhibit 10.11
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the "Agreement") made
and entered into as of July 20, 1998, by and between CARROLS CORPORATION,
(successor by merger with Pollo Tropical, Inc.), a Delaware corporation (the
"Company"), and XXXXXXXX X. XXXXXXXX ("Employee").
W I T N E S S E T H
WHEREAS, pursuant to the terms of an employment agreement dated
September 19, 1995 between Pollo Tropical, Inc. ("Pollo") and Employee, as
amended May 5, 1997 (together the "Prior Agreement") Employee has been and is
presently employed by the Company.
WHEREAS, in connection with the merger of Pollo into the Company, as
of July 20, 1998, the parties have agreed that the Company and Employee shall
enter into this Agreement which shall supersede in its entirety the Prior
Agreement upon the terms and conditions set forth herein;
WHEREAS, Employee has more than 20 years of experience in the
marketing and sale of consumer products and services, and has more than 15
years of experience in corporate management, strategic planning, concept
design, marketing or sales in the restaurant industry (including with Denny's,
Steak and Ale, Bennigan's, Burger King, and Pollo Tropical).
WHEREAS, the Company desires to retain, engage and employ Employee,
and Employee desires to be so retained, engaged and employed by the Company
and to work for the Company, as the President and Chief Operating Officer
("COO") of the Company's Pollo Tropical Division, upon the terms and
conditions set forth in this Agreement; and
WHEREAS, Employee, by reason of the nature of Employee's duties and
responsibilities, will be provided access to the Company's trade secrets and
other confidential and proprietary information and the Company desires to
maintain the confidentiality of such.
NOW, THEREFORE, for and in consideration of the mutual premises,
covenants and agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
the parties hereto, intending to be legally bound, hereby agree as follows:
1. Employment and Duties
1.1 General. The Company hereby employs Employee, and
Employee hereby accepts employment with the Company, effective as of July 20,
1998, as the President and COO of the Company's Pollo Tropical Division for
the term(s) set forth below in Section 2 below, and upon the terms and
conditions set forth in this Agreement.
1.2 Position. During the term of his employment, Employee
shall be the President and COO of the Company's Pollo Tropical Division
("Pollo Tropical"). During his term of employment, Employee shall have duties
generally associated with the office of President and COO of Pollo Tropical.
During the term of his employment, Employee shall devote his full-time
professional efforts and attention to his services as contemplated hereunder,
shall render such services to the best of his ability, and shall carry out his
employment in a good and professional manner and in the best interests of the
Company. Employee shall perform his duties principally from Pollo Tropical's
executive offices, which are presently located in Miami, Florida. Employee
shall be permitted to serve as an outside director of not more than two other
companies and may perform duties as part-time adjunct teacher at a local
college or university provided such membership and teaching duties do not in
the reasonable discretion of the Board of Directors of Carrols Corporation
(the "Board"), negatively impact Employee's ability to perform the duties of
President and COO of Pollo Tropical.
1.3 Management Committee. Employee shall be a member of the
Management Committee of Pollo Tropical, which shall serve as the Board of
Directors of Pollo Tropical.
2. Term of Employment
2.1 Initial Term. The initial term of this Agreement, and of
Employee's employment hereunder, shall be from the date hereof through
September 30, 2003 (the "Initial Term"), subject to the renewal provisions,
set forth below, and subject to earlier termination pursuant to any of
Sections 6, 7 or 8 hereof. The "Term" shall mean the Initial Term, together
with any "Renewal Term(s)" (as hereinafter defined) exercised by the Company.
2.2 Renewal Terms. The Initial Term of this Agreement, and
of Employee's employment hereunder, may, at the Company's option, exercisable
in its sole and absolute discretion, be renewed and extended as follows:
(i) through September 30, 2004 (the "First Renewal
Term"), provided the Company
provides written notice to Employee of such renewal and extension by no later
than July 31, 2003. If this Agreement, and Employee's employment hereunder, is
not so renewed and extended by the Company, then such Agreement and employment
shall automatically cease and terminate upon the expiration of the Initial
Term; and
(ii) if the Company exercises its option to renew
and extend the term of this Agreement, and of Employee's employment hereunder,
pursuant to clause (i) of this Section 2.2 above, then the Company may, at its
option, exercisable in its sole and absolute discretion, renew and extend same
again through September 30, 2005 (the "Second Renewal Term" and, collectively
with the First Renewal Term, each a "Renewal Term" and together the "Renewal
Terms"), provided the Company provides written notice to Employee of such
renewal and extension by no later than July 31, 2004.
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3. Compensation
3.1 Base Salary. Commencing July 1, 1998 and throughout the
Term of Employee's employment under this Agreement, in consideration for all
services rendered for and on behalf of the Company and Pollo Tropical,
Employee shall receive a base salary (as may be increased from time to time in
accordance with the next succeeding sentence, the "Base Salary") at the annual
rate of $300,000.00, payable in accordance with the Company's regular payroll
practices in effect from time to time. On January 1, 2000 and on each January
1st thereafter during the Term, Employee's base salary shall be increased by a
minimum of 5% per annum and may be increased above the minimum 5% per annum,
in the sole and absolute discretion of the Board of Directors of the Company
(the "Board") (or Compensation Committee thereof), if the Board (or
Compensation Committee) determines that such additional increase is reasonable
and appropriate under the circumstances.
3.2 Bonus. For the period July 1, 1998 to December 31, 1998,
and each calendar year thereafter during the Term, Employee shall, in addition
to Base Salary, be eligible to receive an annual bonus (the "Bonus") of up to
one hundred percent (100%) of his Base Salary (of which not more than 50% may
be subject to deferral provisions in the Executive Bonus Plan) for the period,
which Bonus shall become payable in accordance with the then current Executive
Bonus Plan established by the Compensation Committee of the Board and be based
solely upon the achievement by Employee of certain corporate and individual
performance standards during the relevant period as reasonably established by
the Company after consultation with Employee (the "Performance Standards").
Employee and the Company shall endeavor to agree to the applicable Performance
Standards for each year or period by no later than March 30th of such year or
period. Any such amounts payable shall be paid within thirty (30) days
following the applicable year or period end. For the period January 1, 1998
through June 30, 1998, Employee shall receive a bonus based upon the previous
Pollo Tropical, Inc. Executive Bonus Plan, (i.e. up to 50% of salary for the
period with calculations covering the 12-month period ending December 31,
1998). No bonus earned in 1998 shall be subject to any deferral provisions in
the Executive Bonus Plan.)
4. Stock Option or Tracking Stock Option
4.1 Stock Options or Tracking Stock Option. (a) Employee
shall be entitled to be granted non-qualified options or the equivalent to
purchase 5% of the Pollo Tropical's common stock (fully diluted as measured
upon initial grant date) or equity value if no Common Stock has been issued
(the "Stock Options"), subject to approval by the Compensation Committee of,
and upon the terms and conditions set forth in, that certain form of
Non-Qualified Stock Option Agreement between the Company and Employee to be
attached hereto as Exhibit A (the "Option Agreement"). The Stock Options shall
be issued pursuant to the Pollo Tropical's 1998 Stock Option or Tracking Stock
Option Plan (the "Plan"), to be attached hereto as Exhibit B.
5. Benefits; Expense Reimbursement
5.1 Benefits. During the term of Employee's employment under
this Agreement, Employee shall be entitled to receive the following benefits:
(a) Car Allowance. Employee shall receive an automobile
allowance of $600 per month (pro rated for any partial month of employment).
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(b) Vacation. Commencing September 1, 1998 and
thereafter during the Term of this Agreement, Employee shall be entitled to
three (3) weeks paid vacation per year (pro rated for any period of employment
of less than an entire year). Employee shall also be entitled to all paid
holidays provided by the Company from time to time to its senior management
personnel. All paid vacation must be taken during the year in which it is
earned and available; provided, however, that not more than one (1) week of
paid vacation which is earned and available in any year may by accrued and
carried over to the next succeeding year. No cash payments will be made by the
Company in respect of any earned but unused paid vacation time.
(c) Other Benefits. Employee shall be entitled, in
accordance with the Company's general policies and practices for senior
management in effect from time to time, to participate in and receive the
benefits of any and all health, medical, casualty, accident, disability and
life insurance plans, sick leave plans and other executive and employment
benefits as are made available and in effect from time to time by the Company.
5.2 Reimbursement of Expenses. (a) Employee shall be
entitled to reimbursement of all ordinary and reasonable business expenses
actually paid or incurred by Employee in the course of and pursuant to the
performance of his duties hereunder and in furtherance of the best interests
of the Company.
(b) Any reimbursement by the Company under this Section 5.2
shall be made solely against voucher(s) or invoice(s) therefor and in
accordance with the Company's regular reimbursement practices and procedures
in effect from time to time.
6. Termination of Employment Upon Death or Disability
6.1 Death of Employee. In the event that Employee shall die
during the term of his employment under this Agreement, Employee's employment
with the Company shall immediately cease and terminate and Employee's estate,
heirs (at law), devisees, legatees or other proper and legally-entitled
descendants (hereinafter, "descendants"), or the personal representative,
executor, administrator or other proper legal representative on behalf of such
descendants (the "Legal Representative"), shall be entitled to receive and be
paid solely the amounts, on the terms, provided in Section 6.3 below (relating
to payments and benefits due upon a termination as a result of the death of
Employee) (hereinafter, the "Death Benefit"), and the Company shall have no
further obligation or liability hereunder (other than for any reimbursement of
reasonable out-of-pocket business expenses properly incurred by Employee prior
to his death and documented to the Company in accordance with Sections 5.2(a)
and 5.2(b) hereof).
6.2 Disability of Employee. (a) In the event that Employee
shall become incapacitated by reason of sickness, accident or other mental or
physical disability during the term of his employment hereunder such that he
is substantially unable to perform his duties and responsibilities hereunder
for a period of 60 consecutive days, or for shorter periods aggregating 90
days during any 12-month period (a "Disability"), the Company thereafter shall
have the right, in its sole and absolute discretion, to terminate Employee's
employment under this agreement by sending written notice of such termination
to Employee or his legal guardian or other proper legal representative (the
"Guardian") and thereupon his employment hereunder shall immediately cease and
terminate. In the event of any such termination, Employee shall be entitled to
receive and be paid solely the amounts, on the terms, provided in Section 6.3
below (relating to payments and benefits due upon a termination as a result of
the Disability of Employee) (the "Disability Benefit"), and the Company shall
have no further obligation or liability hereunder (other than for any
reimbursement of reasonable out-of-pocket business expenses
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properly incurred by Employee prior to his Disability and documented to the
Company in accordance with Sections 5.2(a) and 5.2(b) hereof).
(b) Notwithstanding Section 10.4 hereof, in the event
of any good faith dispute which cannot be resolved after reasonable efforts
between the parties as to whether Employee suffers a "Disability" as such term
is defined and used in this Section 6.2, then the issue shall be determined by
the unanimous decision of two Qualifying Physicians (as such term is defined
below), with one physician to be appointed by the Company and the other to be
appointed by Employee. If the two Qualifying Physicians are unable to agree on
the issue, they shall jointly appoint a third Qualifying Physician, and the
decision of a majority of the three Qualifying Physicians shall be final and
binding on all parties as to the issue of Disability. The fees, costs and
expenses associated with such determination, including without limitation the
fees of Qualifying Physicians, shall be assessed against and paid by the
unsuccessful party. Each party shall be entitled to submit testimony,
documents and other competent evidence before the Qualifying Physicians. As
used herein, "Qualifying Physician" shall mean a physician licensed to
practice medicine in the State of Florida for at least five (5) years, and who
has no personal or professional relationship with, or business or financial
interest related to, either party to this Agreement.
6.3 Payments Upon Section 6 Termination. Within forty-five
(45) days of a termination by reason of death or Disability pursuant to
Section 6.1 or Section 6.2 hereof, respectively, the Legal Representative or
Employee (or Employee's Guardian), as the case may be, shall be entitled to
receive and be paid Employee's Base Salary as in effect on the date of
termination, payable at the Company's regular and customary intervals for the
payment of salaries as then in effect, for the lesser of three (3) months or
the remaining term of this Agreement (the "Payment Period"), and, except as
otherwise provided below, no other or further amounts or payments (other than
any previously due and unpaid amounts to which Employee is entitled through
the date of death or Disability, as the case may be). In addition, in the
event of a Disability termination pursuant to Section 6.2 hereof, during such
Payment Period the Company shall continue to provide to Employee, at the
Company's expense, the health and medical insurance benefits described in
Section 5.1(c) hereof as in effect at the date of termination (and solely in
accordance with the terms and provisions of such benefits and related plans).
Employee shall also be entitled to receive in one lump sum, payable within 30
days of the date of termination, any benefits or entitlements, including,
without limitation, any portion of Bonus that was deferred under the Pollo
Tropical Executive Bonus Plan and any vesting of Stock Options, in the case of
such Stock Options, solely as such are specifically provided for, in the event
of death or Disability, as the case may be, under the terms, provisions and
conditions of the Option Agreement. Employee shall accept payment pursuant to
this Section 6 in full discharge and release of the Company of and from any
further obligation or liability under this Agreement.
7. Termination by Company for Cause; By Employee Without Good
Reason
7.1 Termination by Company for Cause. The Company shall have
the right, in its sole and absolute discretion, to terminate the employment of
Employee hereunder, at any time, for cause (as used herein, "Cause"), if:
(i) Employee shall be convicted by a court of competent
jurisdiction of any crime (whether or not involving the Company) which
constitutes a felony in the jurisdiction involved or shall be habitually
drunk, drugged or intoxicated in public or otherwise commit acts of moral
turpitude in such a manner as to publicly and adversely reflect upon the
reputation or stature of the Company; or
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(ii) Employee shall have committed any act of fraud,
embezzlement, misappropriation of funds or similar dishonest and injurious
conduct against the Company, or shall have violated either (x) the Company's
Board-adopted policy regarding trading in the Company's securities on the
basis of material, non-public information, or (y) the restrictive covenant set
forth in Section 9.2 hereof; or
(iii) Employee shall have demonstrated willful and
injurious misconduct, or shall have demonstrated reckless or grossly negligent
and injurious conduct, in connection with the performance of his duties and
responsibilities under, or assigned pursuant to, this Agreement.
In the event of any such termination for Cause, Employee shall be entitled to
receive and be paid solely the amounts, on the terms, provided in Section 7.3
below, and the Company shall have no further obligation or liability to
Employee (other than for any reimbursement of reasonable out-of-pocket
business expenses properly incurred by Employee prior to such termination and
documented to the Company in accordance with Sections 5.2(a) and 5.2(b)
hereof).
7.2 Termination by Employee Without Good Reason. In the
event Employee shall terminate his employment with the Company at any time
during the Term, , and such termination of employment shall be for any cause,
reason or justification other than for Good Reason (as such term is defined,
and in accordance with the procedures established, under Section 8.2 below),
excluding only death and Disability (but including, without limitation,
quitting or voluntary resignation or termination), then Employee shall be
entitled to receive and be paid solely the amounts, on the terms, provided in
Section 7.3 below, and the Company shall have no further obligation or
liability (other than for any reimbursement of reasonable out-of-pocket
business expenses properly incurred by Employee prior to such termination and
documented to the Company in accordance with Sections 5.2(a) and 5.2(b)
hereof).
7.3 Payments Upon Section 7 Termination. In the event that
the employment of Employee shall be terminated by the Company for Cause
pursuant to Section 7.1 hereof, or such employment shall be terminated by
Employee for any cause, reason or justification other than for Good Reason as
described in Section 7.2 hereof, then, in either such case, Employee shall be
entitled to receive and be paid his Base Salary then in effect through the
date of such termination, and no other or further amounts or payments. Nothing
contained in this Section 7 shall constitute a waiver or release by the
Company of any rights or claims it may have against Employee, including, but
not limited to, any rights or claims pursuant to Section 9 hereof or arising
from actions or omissions which may give rise to an event causing or leading
to termination of this Agreement pursuant to this Section 7. Employee shall
accept payment pursuant to this Section 7 in full discharge and release of the
Company of and from any further obligation or liability under this Agreement.
8. Termination By Company Without Cause; by Employee for Good
Reason
8.1 Termination by Company Without Cause. The Company shall
have the right, in its sole and absolute discretion, to terminate the
employment of Employee, at any time, without Cause, or otherwise without any
cause, reason or justification, provided that the Company provides to Employee
at least thirty (30) days' prior written notice (the "Termination Notice") of
such termination. In the event of any such termination by the Company, (i)
Employee's employment with the Company shall cease and terminate on the date
specified in the Termination Notice (or, if no date is so specified, on the
date which is 30 days following the date of such notice), and (ii) Employee
shall be entitled to receive and be paid solely the amounts, on the terms,
provided in Section 8.4 below, and the Company shall have no further
obligation or liability to Employee hereunder (other than for any
reimbursement of reasonable out-of-
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pocket business expenses properly incurred by Employee prior to such
termination and documented to the Company in accordance with Sections 5.2(a)
and 5.2(b) hereof).
8.2 Termination by Employee for Good Reason; Procedures. (a)
Employee shall have the right to terminate his employment with the Company, at
any time, for Good Reason (as such term is defined in Section 8.2(c) below),
provided that Employee provides not less than forty-five (45) days' prior
written notice to the Company, which notice shall explain in reasonable detail
the cause or reason for such termination, and provided Employee satisfies the
provisions and procedures set forth in this Section 8.2. On a mutually agreed
date which shall be within fifteen (15) days following receipt of Employee's
notice to the Company, Employee shall meet with representatives of the
Company's Board of Directors and Employee shall present testimony and other
evidence as to the bona fides of his purported termination for Good Reason
hereunder. Within fifteen (15) days following such meeting, the Company shall
have the opportunity to correct or cure the matter, or otherwise to address
Employee's "Good Reason" concerns, such that there is no further reasonable
basis for Employee's purported termination for Good Reason hereunder. If, at
the conclusion of such second fifteen (15) day period, Employee continues to
maintain in good faith that he has grounds to terminate his employment for
Good Reason under this Section 8.2, he shall provide written notice of such,
within five (5) days, to the Company, and thereupon the parties shall
endeavor, for a period not to exceed ten (10) days, to amicably resolve,
settle and compromise the matter. If no such resolution, settlement or
compromise is reached by the conclusion of such 10-day period, the matter
shall promptly be submitted to arbitration in accordance with the procedures
set forth in Section 10.4 hereof. The determination of the arbitration panel
selected pursuant to Section 10.4 hereof -- which shall determine whether
Employee has properly terminated his employment for Good Reason in accordance
with this Agreement and, if so, the date of such termination, and shall assess
the fees and costs associated with arbitration in accordance with Section 10.4
-- shall be final and binding on all parties.
(b) In the event Employee satisfies the provisions of
Section 8.2(a) hereof and thus is found to have properly terminated his
employment for Good Reason in accordance with this Section 8.2, (i) Employee's
employment with the Company shall cease and terminate on the date determined
by the arbitration panel (or, if the issue is agreed upon by both parties, on
the mutually agreed date), and (ii) Employee shall be entitled to receive and
be paid solely the amounts, on the terms, provided in Section 8.4 below, and
the Company shall have no further obligation or liability to Employee
hereunder (other than for any reimbursement of reasonable out-of-pocket
business expenses properly incurred by Employee prior to such termination and
documented to the Company in accordance with Sections 5.2(a) and 5.2(b)
hereof).
(c) For purposes of this Agreement, the term "Good Reason"
shall mean and include the following:
(i) any failure by the Company to pay to Employee the
then applicable Base Salary and/or Bonus as such is required (or, in the case
of the Bonus, as such may be required) to be paid under and in accordance with
the terms of Section 3 of this Agreement, other than an isolated,
insubstantial or inadvertent failure not occurring in bad faith and which is
remedied promptly by the Company after receipt of written notice thereof from
Employee; or
(ii) the assignment to Employee, without Employee's
consent, of a title or position which is materially inconsistent with
Employee's title or position as provided for or contemplated under this
Agreement, or action by the Company which results in the material diminution
of such title or position; or
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(iii) the requirement by the Company that Employee,
without Employee's consent, perform the services, duties and responsibilities
required of Employee as contemplated hereunder from a location or office which
is located outside of the South Florida area (which includes Miami Dade,
Broward and Palm Beach counties), excluding business travel, road shows, trade
shows and restaurant, franchise and site visits reasonably required in the
course of performance of his duties as President and COO of Pollo Tropical
hereunder.
8.3 Non-Renewal or Expiration of Employment Term. Pursuant
to Section 2.2 hereof, the Company, in its sole and absolute discretion, has
the option, among other things, to renew and extend this Agreement, and the
employment of Employee hereunder. Pursuant to such Section 2.2, the Company
also has the right, in its sole and absolute discretion, not to renew or
extend this Agreement, and the employment of Employee hereunder, beyond the
Initial Term. In the event this Agreement is not renewed and extended by the
Company beyond the expiration of the Initial Term or any Renewal Term, or
otherwise expires in accordance with its terms (in each case, an
"Expiration"), then (i) this Agreement and Employee's employment shall
automatically cease and terminate upon such Expiration, and (ii) Employee
shall be entitled to receive and be paid solely the amounts, on the terms,
provided in Section 8.4 below, and the Company shall have no further
obligation or liability to Employee hereunder (other than for any
reimbursement of reasonable out-of-pocket business expenses properly incurred
by Employee prior to such termination and documented to the Company in
accordance with Sections 5.2(a) and 5.2(b) hereof). Notwithstanding any other
term or provision in this Agreement (except as expressly provided in Section
8.4 hereof), no right to payments or benefits shall arise hereunder or
otherwise in the event the Company does not elect to renew or extend
Employee's employment term (or this Agreement) beyond the Initial Term or any
Renewal Term.
8.4 Payments Upon Section 8 Termination or Expiration. (a)
In the event of either (x) a termination of Employee's employment under,
pursuant to and in compliance with Section 8.1 or Section 8.2 hereof, which
termination of employment occurs at any time, or (y) in the event of an
Expiration (as such term is defined in Section 8.3 hereof) of this Agreement,
then Employee shall be entitled solely to the following payments and benefits:
(i) An amount equal to the greater of (x) the Employee's
Base Salary then in effect, from the date on which Employee's employment is
terminated or expires under the terms of this Agreement (the "Termination
Date") until twelve (12) months after the Termination Date or (y) the
Employee's Base Salary from the Termination Date through the end of the
Initial Term as set forth in Section 2.1. The foregoing shall be payable as
follows: a lump sum equal to one year's then current Base Salary payable
within ten (10) days of the Termination Date and the balance, if any, payable
in 24 equal monthly installments (i.e. through the end of the term of the
2-year non-competition agreement in Section 9.2).
(ii) Employee's Stock Options to be granted under
the Option Agreement (as such terms are defined and described in Section 4.1
hereof) shall vest as set forth in and in accordance with the terms and
provisions of the Option Agreement;
(iii) Employee's health and medical insurance
benefits described under Section 5.1(c) (in accordance with the terms and
provisions of such benefits and related plans), shall be continued at the
Company's expense through the date which is 24 months following the
Termination Date.
(iv) Any portion of Bonus that was deferred under
the Pollo Tropical Executive Bonus Plan, shall be payable in a lump sum within
ten (10) days of the Termination Date.
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(b) Employee shall accept payment pursuant to this Section 8
in full discharge and release of the Company of and from any further
obligation or liability under this Agreement.
9. Restrictive Covenants
9.1 Confidentiality Agreement. (a) Employee recognizes and
acknowledges that, as a consequence of his duties hereunder, Employee from
time to time will be provided access to or will otherwise come into contact
with confidential and/or proprietary information of or regarding the Company.
Accordingly, Employee agrees that he will not, during or after the term of his
engagement, except with the prior written consent of the Company (or as
expressly provided herein), disclose any confidential information relating to
the Company to any individual or entity (other than employees or
representatives of the Company who need to know such information to further
the best interests of the Company, and other than third parties, such as
analysts, potential franchisees, potential investors or lenders, who are
either bound by a confidentiality agreement with respect to such information
or, where such an agreement is not advisable or appropriate, are reasonably
expected to further the best interests of the Company). The provisions of this
Section 9.1 shall not apply to information which is or shall become generally
known to the public, the trade or similarly employed persons (except by reason
of Employee's breach of his obligations hereunder), information which is or
shall become available in trade or other publications (except by reason of
Employee's breach of his obligations hereunder), and information which
Employee is required to disclose by law or by order of a court of competent
jurisdiction (but only to the extent specifically required by law or ordered
by such court and only if Employee, where possible, shall give the Company
prior notice of such intended disclosure so that it has the opportunity to
seek a protective order if it deems such appropriate).
(b) As used in this Agreement, "confidential information"
shall mean and include studies, plans, reports, surveys, analyses, budgets,
projections, sketches, drawings, notes, records, renditions, promotional
materials, agreements, memoranda or documents, and all other information
relating to the Company's activities, operations, products, services, layouts,
plans, strategies, systems, prospects and finances, including, without
limitation, all methods, processes, recipes, techniques, shop practices,
equipment, research data, marketing and sales information, personnel data,
customer lists, supplier lists, franchisee lists, location lists, employee
lists, financial data, data compilations, and all other techniques, know-how
and trade secrets, including improvements thereof or know-how related thereto,
which presently or in the future relate to the Company, or were conceived,
originated, discovered or developed by the Company or any employee, agent,
consultant or representative thereof (including, without limitation,
Employee), or were or are in the possession of the Company. "Confidential
information" shall not include general knowledge, expertise or skills gained
by Employee with respect to the industry or markets in which the Company
operates or information which Employee can prove by documentary evidence was
known to Employee prior to his employment with the Company.
9.2 Non-Competition Agreement. (a) For so long as he is
employed by the Company and for a period of two (2) years following the
Termination Date, Employee shall not, directly or indirectly, for himself or
for or on behalf of (either as principal, agent or consultant for, or in which
he is or may be or become an officer, director, trustee, employee, significant
shareholder, partner, member, or with which he is otherwise affiliated) any
corporation, partnership, company, association, firm, entity or organization:
(i) provide services to, or engage in any business for
profit with, any food service operation which:
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(a) is a quick-service format restaurant operation,
or "home meal replacement" food preparation or delivery operation, in each
case, which derives 30 percent (30%) or more of its gross food product
revenues from the retail sale of poultry products (and, of such 30%, at least
half of such revenues shall relate to the retail sale of bone-in poultry
products); or
(b) is a Latin, tropical or Caribbean-theme restaurant
operation (whether quick-service, sit-down, casual dining or other format) in
the United States (including its territories);
or
(ii) attempt to employ, solicit the employment of, offer
employment to or enter into any employment or consulting agreement,
arrangement, understanding or relationship with any employee or former
employee of the Company, unless such employee or former employee has not been
employed by the Company for a period of more than one (1) year.
(b) Employee acknowledges that Section 9.2(a) above shall
not be construed to limit in any way Employee's obligations regarding use or
disclosure of confidential information as set forth in Section 9.1 above. If
Employee violates this restrictive covenant and the Company brings legal
action for injunctive or other relief and prevails in any such action, the
Company shall not, as a result of the time involved in obtaining the relief,
be deprived of the benefit of the full period of the restrictive covenant.
Employee's obligations pursuant to Section 9.1 above regarding the
nondisclosure of confidential or proprietary information shall survive and
continue after the two year restrictive time period provided in Section 9.2.
9.3 Property of Company. All files, records, lists, notes,
books, documents, materials, literature, discs, tapes, software, recordings,
products and other materials (collectively, "Materials") owned by the Company
or used by the Company in connection with its business or operations shall at
all times remain the property of the Company, and, upon termination of
Employee's employment, irrespective of the time, manner, cause or
circumstances of termination, Employee shall surrender all of such Materials
to the Secretary (or other properly authorized officer) of the Company.
9.4 No Modification; Conflicts. Employee understands and
agrees that, unless he receives the prior written consent of the Company, his
covenants, agreements and obligations under this Agreement (and each of them)
may not be modified, released, amended, waived or terminated, and shall
survive any termination of employment, irrespective of the time, manner, cause
or circumstances of termination. Employee shall advise the Company's Board of
Directors in writing of any matter which appears to present a conflict of
interest with the interests of the Company, and Employee will promptly comply
with any reasonable action requested by the Company to resolve or remedy any
such conflicts as, when and if they arise.
9.5 Enforcement; Injunctive Relief. Notwithstanding any term
or provision of this Agreement to the contrary (including, without limitation,
Section 10.4 hereof), the restrictions, covenants and agreements set forth in
this Section 9 shall be subject to interpretation and enforcement solely in
accordance with this Section 9.5. Employee acknowledges that the services to
be rendered by him are of a special, unique and extraordinary character, that,
in connection with such services, he will have access to confidential and
proprietary information vital to the Company's business, and that therefore
the restrictive covenants set forth in this Section 9 hereof are bargained
for, fair and reasonable. Accordingly, Employee consents and agrees that if he
violates any of the provisions of this Section 9, the
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Company would sustain irreparable harm and damage, the monetary amount of
which may be impossible to ascertain. Therefore, in addition to any other
remedies which may be available to it, Employee acknowledges and agrees that
the Company shall be entitled to apply to any court of competent jurisdiction
for an injunction enjoining and restraining Employee from committing or
continuing any such violation of any provision of this Agreement. Nothing in
this Agreement shall be construed as prohibiting or limiting the Company from
pursuing any other remedy or remedies, at law or in equity, before any court
of competent jurisdiction, including, without limitation, recovery of damages.
9.6 Modification or Elimination of Restrictions. In the
event that, notwithstanding Employee's acknowledgment that the restrictive
covenants set forth in Section 9 hereof are bargained for, fair and
reasonable, any of the restrictions contained in Section 9 shall be held to be
in any way an unreasonable or otherwise unenforceable restriction on Employee,
then, and only in such event, the parties hereto specifically agree that the
court so holding may reduce the territory and/or period of time in which such
restrictions operate, or modify, reduce or eliminate any such restriction, in
each case, to the extent necessary to render such section enforceable to the
maximum extent permitted under applicable law. The parties hereto desire that
the restrictive covenants included in this Section 9 be enforced as written
and, if not as written, to the maximum extent possible.
9.7 Employee's Address. Upon any termination of employment
with the Company by Employee and for a period of two years thereafter,
Employee shall advise the Company of his home and business addresses and the
identity of his employer, including any changes thereto.
10. Miscellaneous
10.1 Attorneys' Fees. Each party hereto shall be responsible
for its own attorney's or other fees associated with drafting and negotiating
this Agreement. In the event of any dispute which results in a proceeding
between the parties (including any arbitration pursuant to Section 10.4
hereof) arising out of or relating to this Agreement, the unsuccessful party
shall pay to the successful party all costs and expenses incurred therein by
the successful party, including, without limitation, reasonable attorneys'
fees and expenses, which costs, expenses and fees shall be included in and
made a part of any judgment or award rendered in such proceeding.
10.2 Notices. All notices, requests, demands, waivers,
consents, approvals or other communications required or permitted hereunder
shall be in writing and shall be deemed to have been given when received if
delivered personally or by recognized overnight courier, or three (3) days
after being sent if sent by certified or registered mail, postage prepaid,
return receipt requested, to the following addresses:
If to the Company, to: CARROLS CORPORATION
000 Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Chairman
General Counsel
(or to such other address as the Company makes publicly
known as the address of its principal executive offices).
If to Employee, to his last known address as set forth in
the Company's employment and payroll records.
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Any party may by proper notice change the address to which notice or
other communications to it are to be delivered or mailed.
10.3 Entire Agreement; Employee Representations; Amendments;
Waivers; Headings; Drafting. (a) This Agreement (together with the other
written agreements specifically referred to herein) represents the entire
agreement between the parties with respect to the subject matter hereof and
shall not be modified or affected by, and supersedes, any and all prior
offers, proposals, statements, understandings, promises, assurances,
warranties or representations, oral or written, made by, for or on behalf of
either party. Notwithstanding any other term or provision hereof (or any
descriptions contained herein), the terms, provisions and conditions of the
Stock Options shall be as set forth in, and shall be governed solely by, the
Option Agreement (in its final form as executed and delivered by both
parties).
(b) As a material inducement for the Company to enter into
this Agreement, Employee represents and warrants to the Company as follows:
(i) the Company (including, for purposes of this Section 10.3(b), includes its
officers, directors, employees, agents, representatives and controlling
shareholders, or any of them), has not made, and does not make, any
representation, warranty, promise or assurance to Employee regarding the
Company, or its business, operations, affairs, financial condition, capital
resources, personnel, plans, prospects or related or other matters regarding
the Company, and (ii) with respect to any information or materials
(hereinafter, "materials") the Company may have provided to Employee prior to
and including the date hereof, although the Company has endeavored to include
in any such materials information known to it which it believes to be relevant
and useful for the purposes of Employee's evaluation and investigation,
Employee specifically understands and agrees that the Company has not made,
and does not make, any representation, warranty, promise or assurance as to
the accuracy or completeness of any such information (provided, however, that
the Company represents that any such materials which have been filed with the
Securities and Exchange Commission and made publicly available are, as of the
date of which they speak, true and correct in all material respects).
(c) This Agreement may not be amended or modified except by
an instrument in writing signed by the Company and Employee. The waiver by
either party of a breach or violation of any term or provision of this
Agreement shall not operate nor be construed as a waiver of any subsequent
breach or violation.
(d) The captions and headings set forth herein are for
convenience of reference only, and shall in no way effect the meaning,
construction or interpretation of this Agreement.
(e) The fact that one party initially prepared the first
draft, or was responsible for revising subsequent drafts, of this Agreement
shall be accorded no weight, shall give rise to no presumption regarding
bargaining position, and otherwise shall not affect the construction, meaning
or interpretation of any term or provision hereof, each party having been
represented by counsel having reviewed and discussed the document and having
thoughtfully considered and weighed the relative merits and costs, benefits
and detriments, of each of the provisions hereof before entering into this
Agreement.
10.4 Arbitration. (a) Except as set forth in subsection (b)
of this Section 10.4, in the event that any good faith dispute arises between
the parties regarding the terms or provisions of this Agreement, and
specifically as provided under Section 8.2 hereof (regarding a purported "Good
Reason" termination by Employee), the following provisions and procedures
shall apply for reaching a final resolution of such dispute. The matters
and/or issues which cannot be resolved after the parties have used reasonable
efforts to reach an amicable resolution or settlement shall be settled by
arbitration in
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accordance with the Commercial Arbitration Rules of the American Arbitration
Association (or any successor thereof), and judgment upon the determination or
award rendered by the arbitration panel may be entered in any court having
competent jurisdiction over such. Venue of the arbitration shall be Miami,
Florida. Any controversy or claim shall be submitted to a panel of three
arbitrators selected from the panels of arbitrators of the American
Arbitration Association. In the event of any such arbitration, (i) the
arbitrators shall interpret the terms, provisions and conditions, and the
rights, duties, responsibilities, entitlements and benefits, hereunder based
solely upon the language set forth in this Agreement, it being understood and
agreed by the parties that each party has carefully considered, negotiated and
bargained for the language as set forth in this Agreement, and (ii) the fees,
costs and expenses associated with such arbitration, including without
limitation, the fees of members of the arbitration panel, shall be assessed
and paid in accordance with Section 10.1 hereof. Each party shall be entitled
to submit testimony, documents and other competent evidence before the panel.
The determination of the arbitration panel pursuant to this Section 10.4 shall
be final and binding on all parties.
(b) Notwithstanding any other term or provision of this
Agreement, the provisions and procedures set forth in subsection (a) of this
Section 10.4 shall not apply to any dispute, interpretation or enforcement of
any term, provision or restriction set forth in Section 9 hereof.
10.5 Further Assurances; Releases. Each party shall execute
and deliver such other and further agreements, instruments, releases and
documents as the other party may reasonably request in order to more fully
implement the agreements and obligations provided for under this Agreement.
Any failure or refusal by a party to provide a further implementing agreement,
instrument, release or document requested by the other party, or required
pursuant to the terms of this Agreement, shall in no way affect the substance,
meaning, validity or enforceability of the provision or agreement (whether a
representation, covenant, release, discharge or otherwise) which is sought to
be more fully implemented, or implemented, pursuant to this Agreement.
Employee affirms that he has carefully read and fully understands all of the
provisions of this Agreement, that he has had the opportunity to consult with
legal counsel regarding the contents and consequences of this Agreement, that
he signed this Agreement knowingly, voluntarily and of his own free will
intending to be legally bound hereby. Employee recognizes that this Agreement
requires, under the circumstances specified herein, the full discharge and
release (the "Release") by Employee (on behalf of himself and his assigns,
estate, descendants, Guardian(s) and other representative(s), including Legal
Representatives), of the Company (and its successors, assigns, officers and
directors) of and from any further obligation or liability under this
Agreement. The requirement of the Release, under the circumstances specified
in this Agreement, was bargained for between the parties and constitutes a
material provision, or provisions, of this Agreement.
10.6 Successors and Assigns: Severability. This Agreement
shall inure to the benefit of and be binding upon and enforceable against the
Company, its successors and assigns, and Employee and his descendants,
executors, administrators and other representatives, including Legal
Representatives. This Agreement is not assignable, and the obligations
hereunder are not delegable, by Employee. Should any section, provision or
clause hereof be held to be invalid, void or unenforceable, such holding shall
not affect any other section, provision or clause hereof which can be given
effect without such invalid, void or unenforceable provision.
10.7 Governing Law Venue. This Agreement, and all questions
as to its validity, interpretation, meaning, performance and enforcement,
shall be governed by and construed and enforced in accordance with the
internal laws of the State of Florida. The Federal and state courts of Miami -
Dade County, Florida shall be the exclusive venue for any litigation or other
proceeding that may arise out of or by reason of this Agreement.
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10.8 Counterparts. This Agreement may be executed in
separate counterparts, each of which shall be deemed to be an original as
against any party whose signature (or, in the case of the Company, whose
officer's signature) appears thereon, and all of which together shall
constitute one and the same instrument and agreement. This agreement shall be
and become binding when all parties hereto have signed or executed one or more
counterparts.
10.9 Directors and Officers Liability Insurance. Employee
shall be covered under the Carrols Corporation Officers and Directors
liability insurance policy as long as such policy is in effect. The Company
shall notify Employee, in writing, thirty (30) days prior to the cancellation
or termination of such insurance coverage.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first above written.
Witnesses: CARROLS CORPORATION
By: /s/ Xxxx Xxxxxx
------------------------------------ -------------------------------
Name: Xxxx Xxxxxx
Title: Chairman and Chief
Executive Officer
EMPLOYEE
/s/ Xxxxxxxx X. Xxxxxxxx
------------------------------------- ----------------------------------
Xxxxxxxx X. Xxxxxxxx
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