EXHIBIT 10.2
MUTUAL WAIVER AND RELEASE OF CLAIMS
THIS MUTUAL WAIVER AND RELEASE OF CLAIMS AGREEMENT (hereinafter, the
"Agreement"), effective as of December 1, 2004, is entered into in the County of
Maricopa, State of Arizona, by and between Kona Grill, Inc., a Delaware
corporation (the "Company") and Chandler (the "Executive").
RECITALS
1. Executive has extensive experience in the restaurant business over
the last thirty years, has operated four different concepts in nine states and
three countries, and was employed by Company as an Officer and as a member of
the board of directors of the Company (a "Director").
2. Company and Executive have entered into a Confidential Agreement
attached hereto at Exhibit A (the "Confidential Agreement").
3. Executive has resigned as a Director as attached on Exhibit B.
3. The parties hereto have mutually agreed that it is in their
respective best interests to terminate any and all employment and corporate
relationships between them and bring any and all claims which may arise
therefrom to an amicable resolution.
WHEREFORE, in consideration of the mutual covenants and conditions
contained herein and intending to be legally bound hereby, the parties hereto
agree as follows:
COVENANTS
I.
By execution of this Agreement, Executive hereby acknowledges that he has
resigned from his positions as an employee of Company and as a Director, subject
to the following terms and conditions contained herein:
(a) In consideration for executing this Agreement, and being bound by
all of its covenants and obligations, Executive shall receive the following
consideration and other good and valuable consideration paid to it by the
Company, the receipt of which is hereby acknowledged: (i) in exchange for
releasing the Company from any and all claims arising out of the Executive's
service as a member of the board of directors, the Company shall release
Executive from any and all claims arising therefrom; and (ii) in exchange for
the non-competition sections of this Agreement and for the other obligations and
releases arising from Executive's service as an officer of the Company, the
Company shall grant Executive an option to purchase 48,560 shares of Common
stock of the Company at $1.20 per share (the "Option"), which Option shall vest
as of the date above, subject to the provisions of this Agreement. Executive
hereby agrees to not to exercise or sell, and the Company agrees to not process
the exercise of any Option or transfer any shares obtained by or through the
Option to any third party for a period of 2 years following the date of this
Agreement;
(b) Executive shall promptly return all corporate paper and property in
his possession.
(c) Executive hereby declares that all voting agreements relating to his
stock and/or position as a director or officer of the Company are hereby
terminated. Executive hereby constitutes and appoints the Company and its
successors and assigns as its true and lawful attorneys in fact in connection
with the termination of any and all voting agreements, with full power of
substitution, in the name and stead of the Executive, to terminate and end any
and all voting agreements outstanding.
II.
Both parties agree not to disparage or impugn the business reputation of
the other.
III.
(a) In consideration of the mutual covenants contained herein,
Executive, for himself and, as applicable, his respective agents, attorneys,
successors, and assigns, hereby fully, forever, irrevocably, and unconditionally
releases the Company, including any parent, subsidiary, related and affiliate
entities, any predecessors, successors, and assigns and the current and past
officers, directors, shareholders, agents, and employees of each and all of the
foregoing from any and all claims, charges, complaints, liabilities, and
obligations of any nature whatsoever, which he may have, whether now known or
unknown, and whether asserted or unasserted, arising from any event or omission
occurring from the beginning of time to the date of execution of this Agreement.
This release includes, without limitations:
(i) all rights or claims arising out of Executive's
employment with Company and/or the termination of that employment,
including any and all claims arising out of or which could arise out of
the employment relationship between Executive and Company and the
termination of that employment, including but not limited to: (a) any and
all claims under Title VII of the Civil Rights Act of 1964, the Americans
with Disabilities Act, the Age Discrimination in Employment Act, Section
1981 of the Civil Rights Act of 1866, the Employee Retirement Income
Security Act (ERISA), the Equal Pay Act, applicable whistleblower laws,
the Arizona Civil Rights Act, the Arizona Employment Protection Act, and
any other applicable state and local civil rights laws, Arizona wage
payment laws and any and all similar laws in other states; and (b) any
contract, express or implied, tort, statute or any other provision or
theory of law or equity.
(ii) all rights or claims arising out of Executive's service
as a Director and/or the termination of that service;
(iii) all claims arising under any state or federal statute,
or any common law cause of action, including claims for breach of any
express or implied contract, wrongful discharge, tort, civil rights, age
discrimination, personal injury or any claims for attorneys' fees or other
costs, and
(iv) all rights or claims arising out of any existing
agreements between Executive and the Company;
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(b) Executive represents he has fully disclosed all liabilities and
contracts executed by him on behalf of the Company. Based upon such
representation, Company releases Executive and his heirs, successors or assigns
from all claims of any nature whatsoever whether known or unknown relating to
his employment or service as a Director.
(b) Neither party is releasing the other from any obligation under this
Agreement.
IV.
Executive covenants and agrees to fully indemnify and defend Company and
to hold it harmless of and from any and all claims, demands or causes of action
which may be brought, threatened or pending against it by reason of any actions
of Executive after the date hereof. Company covenants and agrees to fully
indemnify and defend Executive and to hold him harmless of and from any and all
claims, demands or causes of action to the same extent that Company currently
indemnifies its officers and directors, which may be brought, threatened or
pending against it by reason of any actions of Company or any of its officers or
directors occurring up to the date hereof.
V.
Executive covenants and agrees to be fully bound by the following terms
and conditions:
(a) That, while employed by Company, he has had access to trade secrets
and confidential information of Company, including, but not limited to,
introductions to customers, leads to potential customers, opportunities to meet
and develop relationships with customers, knowledge of Company's production
methods and technologies, and knowledge of Company's competitive strategies and
marketing information, including customer lists and pricing information and
strategies. Executive understands and agrees such information is deemed a trade
secret and confidential information. Executive shall not disclose it to any
subsequent Company or third party at any time. In addition, Executive hereby
agrees:
(b) that he shall not disclose or use any confidential information of the
Company;
(c) that he shall not solicit current employees for a period of ninety
(90) days after the date hereof;
(d) that for a period of 2 years following the date of this Agreement, he
shall not own more than 5% or serve as a principal, consultant or employee to
any entity or business which would directly or indirectly engage in any
activities relating to a restaurant business similar in concept to Kona Grill,
including a sushi bar operation, which compete within a radius of 20 miles to
any restaurants owned or operated by the Company or any of its affiliates,
whether such products or services are offered by the Company as of the date
hereof or at any time in the future (provided such products or services were
offered by the Company during the term of Executive's employment), within the
geographic area consisting of the United States of America;
(e) that if he breaches this Paragraph V of the Agreement, Executive
agrees that the any vested Option shall immediately cancel and any shares of the
Company resulting from the
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Option shall immediately be returned to the Company and the Company shall be
entitled to all remedies available at law or in equity, including injunctive
relief. Executive specifically acknowledges that money damages would be
inadequate where a breach of this Paragraph V is a continuing one and the
applicable restrictive time period described herein is unexpired.
(f) That if any provision of this Paragraph V is, or becomes,
unenforceable, the remaining provisions shall nonetheless remain in full force
and effect, and Executive further agrees that if any provision of this Paragraph
V is found to be over broad or unduly restrictive, the court so finding is
authorized to modify the provision in question to the extent necessary to make
it valid and enforceable.
VI.
It is expressly understood and agreed that the Company, by the
undersigned, has full authority and power to enter into this Agreement, and that
this Agreement shall be deemed drafted equally by all parties hereto and that
the language of all parts of this Agreement shall be construed as a whole,
according to its fair meaning, and any presumption or other principle that the
language herein is to be construed against any party shall not apply.
VII.
Executive, by his execution of this Agreement, avows that the following
statements are true:
(a) That he has been given the opportunity to read this entire Agreement
and has had all questions regarding its meaning and content answered to his
satisfaction.
(b) That he has been advised of his right to seek independent legal advice
and counsel of his own choosing regarding this Agreement.
(c) That he fully understands the content of this Agreement.
(d) That this Agreement is given in return for valuable consideration, as
provided under the terms of this Agreement.
(e) That he enters into this Agreement knowingly and voluntarily in
exchange for the promises made in this Agreement and that no other
representations or promises have been made to him to induce or influence his
execution of this Agreement.
VIII.
This Agreement contains the entire agreement between the parties hereto
and shall be binding upon and inure to the benefit of those parties and the
executors, administrators, personal representatives, estates, heirs, successors
and assigns of each. No provision of this Agreement shall be amended, waived, or
modified except by an instrument in writing signed by the parties hereto.
IX.
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This Agreement shall be governed in all respects, whether as to validity,
construction, capacity, performance or otherwise by the laws of the State of
Arizona, and no action involving this Agreement may be brought except in the
Superior Court of the State of Arizona or in the United States District Court
for the District of Arizona. The parties hereto further consent to the
jurisdiction of the Superior Court of Arizona with respect to any claim arising
under this Agreement. If any provision of this Agreement is held by a court of
competent jurisdiction to be invalid, void, or unenforceable for any reason
whatsoever, the remaining provisions of the Agreement shall nevertheless
continue in full force and effect without being impaired in any manner
whatsoever.
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IN WITNESS WHEREOF, Company has caused this Agreement to be executed by
its duly authorized officer, and Executive has hereunto signed this Agreement as
of the day first above written.
Company:
Kona Grill, Inc. a Delaware corporation
/s/ Xxxx X. Xxxxxxx
By: ______________________________________
CFO
Its: ______________________________________
Executive:
/s/ Chandler
________________________
Chandler
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