Exhibit 99(d)(6)
SEVERANCE AGREEMENT
This Severance Agreement ("Agreement") is dated September 26, 2000 among
Xxxxxx Xxxx, an individual resident of the State of Minnesota ("Employee"),
Rainforest Cafe, Inc., a Minnesota corporation ("Rainforest"), and Xxxxxx'x
Seafood Restaurants, Inc., a Delaware corporation ("Xxxxxx'x").
RECITALS
A. The Employee is currently employed by Rainforest and subject to either
the Change of Control Policy adopted by Rainforest on May 9, 2000, or a Change
of Control Agreement between the Employee and Rainforest (the agreement and
policy, collectively, the "Change of Control Policy and Agreement").
B. In the event of a "Change of Control" as defined in the Change of
Control Policy and Agreement, the Employee may be eligible under certain
circumstances to receive certain benefits pursuant to the terms and conditions
of the Change of Control Policy and Agreement.
C. Rainforest has entered into an Agreement and Plan of Merger dated as
of September 26, 2000 (the "Merger Agreement") by and among Rainforest, Xxxxxx'x
and LSR Acquisition Corp., pursuant to which Xxxxxx'x would commence a cash
tender offer for all outstanding shares of Rainforest ("Tender Offer") and, at
the effective time of the merger (the "Effective Time"), Rainforest would become
a wholly-owned subsidiary of Xxxxxx'x (the "Merger").
D. There will be a Change of Control if more than 50% of the outstanding
shares of Rainforest common stock are acquired by Xxxxxx'x pursuant to the
Tender Offer.
E. The parties hereto believe that, given the Tender Offer, it is in the
best interests of such parties for the Employee to terminate and waive all
rights under the Change of Control Policy and Agreement upon the acceptance for
payment of shares of Rainforest common stock under the Tender Offer by Xxxxxx'x
which, together with shares of Rainforest common stock owned by Xxxxxx'x
immediately prior to the launch of the Tender Offer, constitutes at least a
majority of the outstanding shares of Rainforest common stock (the "Closing").
F. In contemplation of the Tender Offer, Xxxxxx'x desires to enter into
this Agreement whereby Employee will receive severance payments based on prior
years of service in consideration for, among other things, Employee's
terminating and waiving all rights under the Change of Control Policy and
Agreement and Employee's relinquishing certain of his or her outstanding stock
options.
G. Attached hereto as Exhibit B is a statement of certain rights relating
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to the ERISA plan of which this Agreement constitutes a part.
NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the sufficiency of which is hereby acknowledged,
Employee, Rainforest and Xxxxxx'x, intending to be legally bound, hereby agree
as follows:
1. Waiver of Rights, etc.
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a. Effective as of and subject to the Closing, the Employee
releases, waives and forever relinquishes all rights to payments,
benefits, compensation or any other consideration under the
Change of Control Policy and Agreement.
b. The Employee agrees that he or she will not exercise any option
to acquire Rainforest's common stock. Each vested option to
acquire Rainforest's common stock held by Employee at the
Effective Time which has an exercise price less than the Offer
Price (as such term is defined in the Merger Agreement) shall be
cancelled and terminated at the Effective Time in consideration
for a payment in cash by Rainforest to Employee promptly
following the Effective Time of an amount equal to the product
obtained by multiplying (x) the excess (if any) of the Offer
Price over the per share exercise price of such option and (y)
the number of shares of Rainforest common stock covered by such
option. Effective as of and subject to the Effective Time,
Employee releases, waives and forever relinquishes any options to
acquire Rainforest's common stock held by Employee at the
Effective Time pursuant to any stock option plan or otherwise,
whether or not such options are vested or unvested, in respect of
which Rainforest is not obligated to make a payment to the
Employee pursuant to the immediately preceding sentence.
c. Sections 2, 3 and 4 of this Agreement shall become effective only
upon the Closing. If the the Closing does not occur, then this
Agreement shall terminate and be of no force or effect.
2. Severance Payment.
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a. In consideration for Employee's representations, warranties,
covenants and agreements under this Agreement and in addition to
all other compensation due and payable to Employee as of the date
of his or her termination (which, for the avoidance of doubt,
does not include any
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payments, benefits, compensation and other consideration payable
under the Change of Control Policy and Agreement), Rainforest
agrees to pay the Severance Payment to Employee based on
Employee's prior years of service in accordance with, and subject
to, this Section 2 (including Sections 2(d) and 2(e) below). For
purposes of this Agreement, the term "Severance Payment" shall
mean an amount equal to the sum of (i) twenty-four months of the
Employee's monthly base salary as of the date of this Agreement
(the "Compensation Payment"), (ii) an amount equal to the six
month cost to Employee of continuing Employee's present health
care coverage under Rainforest's COBRA program (grossed up to
compensate Employee for the taxable nature of such payment), and
(iii) an amount equal to the six month cost to Rainforest of
continuing to provide Employee's non-electable current life
insurance and insurance coverage for accidental death and
disability insurance assuming Employee had continued as an
employee of Rainforest (all as grossed-up to compensate Employee
for the taxable nature of such payments) (the amounts referred to
in foregoing clauses (ii) and (iii), the "Insurance Payment").
Rainforest agrees to provide Employee with 10 days advance
written notice of employment termination in the event that such
termination will occur before six months following the Closing,
unless termination is for "cause."
b. The Severance Payment shall be paid by Rainforest in accordance
with clause (B) of paragraph (d) below after 6 months of
employment following the Closing, subject to Section 2(f) below.
c. In the case of death or disability (as defined under the Social
Security Act) of Employee after the Severance Payment has become
due and payable to Employee pursuant to Section 2(d) below, any
remaining unpaid portion of the Severance Payment shall be paid
immediately to the extent not previously paid.
d. Subject to the provisions of paragraph (e) below, if (A) (1)
Rainforest terminates Employee other than for "cause" (as defined
in Section 5) or (2) Employee is "constructive[ly] terminat[ed]"
(as defined in Section 5), in case of either clause (A)(1) or
(A)(2), prior to the completion of 6 months of employment
following Closing or (B) Employee has completed 6 months of
employment following the Closing in accordance with paragraph (b)
above, then, in any such case, sixteen days after execution and
delivery of the Release (the "Invocation Date") and assuming that
the Release has not been revoked in such intervening period, the
Employee shall be entitled to the Severance Payment, which shall
be paid in the following manner: (i) the Compensation Payment
shall be paid in
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bi-weekly installments in accordance with Rainforest's normal
compensation schedule following the Invocation Date until the
later of (1) July 1, 2001 and (2) the Invocation Date, upon which
date any remaining unpaid portion shall be paid immediately to
Employee; and (ii) following the Invocation Date, the Employee
shall also receive in twelve equal bi-weekly installments the
Insurance Payment.
e. As a condition for receiving the Severance Payment, Employee
shall execute and deliver to Rainforest a General Release and
Waiver Agreement in the form attached hereto as Exhibit A (the
"Release").
f. If Employee resigns from employment other than due to a
"constructive termination" or is terminated for "cause," Employee
shall not receive the Severance Payment or any other payments,
benefits, compensation or other consideration payable under this
Agreement.
g. Payment of the Severance Payment and other consideration under
this Agreement shall be in lieu of any other payments owed by
Xxxxxx'x or its subsidiaries (including Rainforest) to Employee
pursuant to any severance, vacation, personal time-off, "change
of control," retention, or bonus policy (which, for the avoidance
of doubt, includes any and all amounts and benefits payable under
the Change of Control Policy and Agreement).
3. Continued Employment. Upon the Closing, Employee will immediately
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become an at-will employee of Rainforest and employment with Rainforest will
continue until otherwise terminated by Employee or Rainforest. Employee will be
paid a base salary equal to the salary now paid by Rainforest to the Employee,
and receive benefits received by similarly situated Rainforest employees.
Employee will not be eligible to receive any compensation adjustments, bonuses
and stock options received by other Xxxxxx'x employees. In addition, should
Employee's employment with Rainforest continue through March 1, 2001 and if
Employee is eligible to receive a payment under the Rainforest 5% Bonus
Retention Policy, then Rainforest shall pay to Employee promptly following March
1, 2001 any amounts which would have been due under the Rainforest 5% Bonus
Retention Policy. If either the Employee's employment with Rainforest does not
continue through March 1, 2001 or if Employee is not eligible to receive a
payment under the Rainforest 5% Bonus Retention Policy, then Rainforest shall
not pay to Employee any amount under the Rainforest 5% Bonus Retention Policy.
Notwithstanding anything to the contrary contained in this Agreement, the
Employee acknowledges and agrees that Xxxxxx'x and its subsidiaries (including
Rainforest) shall have the right to amend from time to time or terminate any
benefit program applicable to Employee (other than the payments provided for
under Section 2 hereof and the Rainforest 5% Bonus Retention Policy).
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4. Job Responsibilities. Rainforest and Employee agree that, without
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Employee's consent, Employee will not incur a significant or material job
description change, taking into consideration Rainforest's new status as a
subsidiary of Xxxxxx'x. Rainforest shall not impose new job responsibilities
beyond Employee's capabilities or expertise. Rainforest shall not, without
cause, harass, intimidate, threaten or coerce Employee to resign, or engage in
any conduct designed for the purpose of terminating Employee's employment to
deprive Employee from receiving any Severance Payment otherwise due Employee.
Nothing contained herein shall prohibit Rainforest from (i) requesting Employee
to travel to conduct business for Xxxxxx'x or Rainforest in furtherance of
normal and routine business practices, or (ii) relocating Rainforest's
headquarters in Minnesota to any other location within fifty (50) miles of
Rainforest's existing headquarters.
5. Definitions.
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a. For Cause Termination. For the purposes of this Agreement,
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"cause" shall mean: (i) dishonesty which is not the result of an
inadvertent or innocent mistake of Employee with respect to
Xxxxxx'x or any of its subsidiaries (including Rainforest); (ii)
a willful or intentional disregard of the lawful and reasonable
instructions of Rainforest, Xxxxxx'x or their supervisors; (iii)
willful misfeasance of duty by Employee intended to injure or
having the effect of injuring the reputation, goodwill, business,
or business relationships of Xxxxxx'x or any of its subsidiaries
(including Rainforest) or any of their respective officers,
directors, or employees; (iv) material violation by Employee of
any term of employment; (v) conviction of Employee of (or a plea
of nolo contendere by Employee to) any felony or misdemeanor or
any other crime (including any crime involving moral turpitude),
other than a misdemeanor vehicular offense; or (vi) failure of
Employee to perform normal and routine duties of employment or to
adhere to policies of employment after having received at least
two (2) written notices of non-compliance ("write-ups") from
Xxxxxx'x or any of its subsidiaries (including Rainforest).
b. Constructive Termination. For purposes of this Agreement,
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"constructive termination" shall mean: (i) a material adverse
change of Employee's responsibilities with respect to Rainforest,
provided that any changes in responsibilities resulting from
Rainforest's new status as a subsidiary of Xxxxxx'x shall not be
deemed grounds for a "constructive termination"; (ii) a material
adverse change of Employee's compensation or benefits, provided
that the provision of benefits to Employee which are generally
available to similarly situated Xxxxxx'x employees shall not be
deemed to be a material adverse change of Employee's benefits;
(iii) a requirement to
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relocate in excess of fifty (50) miles from Employee's then
current place of employment without Employee's consent; or (iv)
the breach by Xxxxxx'x of any material provision of this
Agreement.
6. Confidentiality.
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a. Except to the extent required by law, Employee shall keep
confidential and shall not, without Xxxxxx'x prior, express
written consent, disclose to any third party, other than as
reasonably necessary or appropriate in connection with Employee's
performance of his duties under this Agreement or any employment
agreement, any information regarding Xxxxxx'x or Rainforest's
business, methods of operation, employees, projects, plans and
prospects, which information has not been released to the public
by Xxxxxx'x or any of its subsidiaries (including Rainforest).
The provisions of this Section 6 shall remain in effect
indefinitely after the expiration or termination of this
Agreement.
b. Employee agrees that the restrictions on disclosure in this
Agreement are fair, reasonable and necessary for the protection
of the interests of Xxxxxx'x and Rainforest. Employee further
agrees that a breach of any of the covenants set forth in this
Section 6 or Section 12 of this Agreement will result in
irreparable injury and damage to Xxxxxx'x and Rainforest for
which Xxxxxx'x and Rainforest would have no adequate remedy at
law, and Employee further agrees that in the event of a breach,
Xxxxxx'x will be entitled to an immediate restraining order and
injunction to prevent such violation or continued violation,
without having to prove damages, in addition to any other
remedies to which Xxxxxx'x or Rainforest may be entitled to at
law or in equity.
7. Payments. All payments made to Employee pursuant to this Agreement
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shall be subject to withholding as required by applicable law, and such
withholding shall, to the extent permitted by applicable law, be calculated in
the same manner as regular wages.
8. Governing Law. This Agreement shall be governed by and construed an
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enforced in accordance with the laws of the State of Minnesota.
9. Counterparts. This Agreement may be executed simultaneously in two or
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more counterparts and via fax, each of which will be deemed an original, but all
of which together will constitute one and the same instrument.
10. Binding Agreement; Assignment. This Agreement shall be binding upon,
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and inure to the benefit of and be enforceable by, the parties hereto and their
respective heirs,
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personal representatives, successors and assigns; provided, however, Employee
may not assign any of Employee's rights or obligations under this Agreement.
11. Complete Agreement. This Agreement and the recitals set forth above
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contain the full and complete understanding between the parties pertaining to
the subject matter hereof and cannot be modified except by a written instrument
signed by the parties.
12. Non-Solicitation. Commencing as of the date hereof and continuing for
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a period of two (2) years following Employee's termination of employment with
Xxxxxx'x and its subsidiaries (including Rainforest), Employee will not, either
directly or indirectly, on Employee's behalf or on behalf of others, solicit,
divert or hire away, or attempt to solicit, divert or hire away, any person
employed by Xxxxxx'x or any of its subsidiaries (including Rainforest), whether
such person is a full-time or temporary employee engaged by Xxxxxx'x or any of
its subsidiaries (including Rainforest), and will not make known to any person
or entity the names and addresses of any of the employees of Xxxxxx'x and its
subsidiaries (including Rainforest) or any information pertaining to the
employees of Xxxxxx'x and its subsidiaries (including Rainforest).
13. Amendment, Modification and Waiver. This Agreement may not be
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amended, modified or waived except by an instrument or instruments in writing
signed and delivered on behalf of each of the parties hereto.
14. Interpretation. The parties have participated jointly in the
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negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties hereto, and no presumption or burden of
proof shall arise favoring or disfavoring any party by virtue of the authorship
of any provisions of this Agreement.
15. Jurisdiction. Each of the parties hereto irrevocably and
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unconditionally submits to the exclusive jurisdiction of any federal court
located in the State of Minnesota or, if such court will not accept
jurisdiction, any state court of competent civil jurisdiction sitting in
Hennepin County, Minnesota. In any action, suit or other proceeding, each of
the parties hereto irrevocably and unconditionally waives and agrees not to
assert by way of motion, as a defense or otherwise any claims that it is not
subject to the jurisdiction of the above courts, that such action or suit is
brought in an inconvenient forum or that the venue of such action, suit or other
proceeding is improper. Each of the parties hereto also agrees that any final
and unappealable judgment against a party hereto in connection with any action,
suit or other proceeding shall be conclusive and binding on such party and that
such award or judgment may be enforced in any court of competent jurisdiction,
either within or outside of the United States. A certified or exemplified copy
of such award or judgment shall be conclusive evidence of the fact and amount of
such award or judgment.
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16. Guarantee. Xxxxxx'x guarantees the performance of all obligations of
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Xxxxxx'x subsidiaries (including Rainforest) under this Agreement (including,
without limitation, the payments payable by Rainforest under this Agreement).
17. Attorney Fees. Should either party bring an action in connection with
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a breach of, or failure to perform, any of the terms of this Agreement, then the
prevailing party shall be entitled to recovery of its attorney's fees and
expenses from the non-prevailing party.
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THIS SEVERANCE AGREEMENT has been executed by and among the parties as
of the date indicated above.
Employee
/s/ Xxxxxx Xxxx
____________________________
Name: Xxxxxx Xxxx
XXXXXX'X SEAFOOD
RESTAURANTS, INC.
/s/ Xxxxxx Xxxxxxxxxx
By__________________________
Vice President
Title ______________________
RAINFOREST CAFE, INC.
/s/ Xxxx Xxxxxx
By__________________________
President
Title ______________________
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