Exhibit 10.6
TRANSITION AND CONSULTING AGREEMENT
This transition and consulting agreement (the "Agreement") is entered into
as of August 29, 1997 between Boston Chicken, Inc., a Delaware corporation (the
"Company" or "BCI"), and Xxxxxxxx Xxxxx ("Xxxxx").
Recitals
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Zwain was employed by the Company as President and Chief Executive Officer
of the Boston Market Concept. The Company has eliminated that position as a
result of an organizational restructuring and the parties now mutually desire to
provide for his transition to a consultant to the Company. Therefore, in
consideration of the mutual covenants hereinafter set forth and in full
satisfaction of any claim Zwain may assert arising from or in any way relating
to Zwain's employment by and separation from the Company, the parties hereto
agree as follows:
Covenants
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1. Consulting Arrangement. (a) Effective August 29, 1997, the Company
shall engage Zwain to render certain consulting services to the Company in
Golden, Colorado through August 28, 1998 (the "Term of Consultation"). Such
consulting services shall include such services as may be mutually agreed upon
from time to time by the Company and Zwain, which services may include advice
and consultation regarding public relations, community relations and customer
relations. The Company agrees that this Agreement shall in no way restrict
Zwain's ability to undertake any business or other activities, including,
without limitation, full-time employment in the food or restaurant industries,
provided such activities and employment are consistent with the terms of that
certain Confidentiality and Non-Compete Agreement dated as of February 7, 1996
by and between the Company and Zwain (the "Confidentiality and Non-Compete
Agreement").
(b) In full satisfaction of any obligations the Company may have to
Zwain relating in any way to his employment at the Company, and in consideration
for Zwain's consulting services during the Term of Consultation, the Company
agrees to (i) pay to Zwain $19,230.77 every two (2) weeks from the date hereof
through August 28, 1998; and (ii) reimburse Zwain for the costs of Zwain's
continued participation in the Company-sponsored group health, medical and
dental plans at Zwain's current level of coverage under the Consolidated Omnibus
Budget Reconciliation Act ("COBRA") through the earlier of August 28, 1998, or
until Zwain is eligible to obtain coverage under an applicable policy of
insurance provided by a subsequent employer. The foregoing is expressly subject
to Zwain's acceptance of, and continued adherence with, all of the terms and
conditions of this Agreement. In no event shall the Company reimburse Zwain for
COBRA benefits beyond August 28, 1998. Zwain agrees to give the Company notice
within five (5) days of obtaining employment with another employer.
(c) In addition to the payments outlined above, the Company shall
reimburse Zwain for all reasonable business expenses incurred by him in
rendering the consulting services hereunder only upon receipt of appropriate
supporting documentation and only if such expenditures are previously approved
by the Chief Executive Officer of the Company and are incurred in accordance
with the Company's policies as they apply to employees.
(d) Zwain's services under this Section will terminate upon his
material breach of any of the covenants contained herein. Upon termination of
Zwain's consulting services as provided in this Section, all obligations of the
Company under this Agreement shall be deemed satisfied, including the payment of
any remaining installments of the fees not yet due and payable under this
Section; provided, however, that such termination shall in no way affect the
validity of Zwain's obligations under, or the rights of the Company with respect
to, the Confidentiality and Non-Compete Agreement or Section 5 of this
Agreement, which shall in each case remain in full force and effect in
accordance with the terms and conditions thereof.
(e) In the event that the Company intends to terminate this Agreement
pursuant to paragraph (d) of this Section, the Company shall first provide Zwain
written notice thereof, which notice shall set forth in reasonable detail
Zwain's breach of covenants hereunder. Upon receipt of such notice Zwain shall
have ten (10) days in which to cure such alleged breach; provided, however, that
no such cure shall be available to Zwain and this Agreement shall terminate
immediately in the event he has breached his obligations under the
Confidentiality and Non-Compete Agreement.
(f) In the event of Zwain's death, disability, illness or other
capacity, the Company shall continue to perform its obligations under Section 1
(b) hereof, and in the event of his death, all payments thereunder shall be made
to his spouse or to such other person or persons as he may previously have
designated in writing.
2. Release. (a) (i) Zwain hereby acknowledges and agrees that the
payments by and obligations of the Company described herein (including the
payments by the Company described in Section 1 hereof) are in partial
consideration of his release of any right to bring any legal claim against BCI
of any nature related in any way, directly or indirectly, to his employment
relationship with BCI, including his separation from employment or his
investment in Market Partners, L.L.C. or Bagel Store Development Funding L.L.C.
This release is intended to be interpreted in the broadest possible manner in
favor of BCI, to include all actual or potential legal claims that Zwain may
have against BCI, except as specifically provided otherwise herein.
Specifically, Zwain acknowledges and agrees that he, for himself and his
successors, assigns and legal representatives, fully and forever releases and
discharges BCI, its subsidiaries and area developers and their respective
officers, directors, employees, agents, representatives and insurers
(collectively, the "Released Parties") from and against any and all claims,
liabilities, demands, obligations, damages, actions, or causes of actions of any
nature or type whatsoever, whether or not presently known, including future
claims, liabilities, demands, obligations, damages, actions or causes of actions
if based in whole or part on acts or omissions occurring before he delivers this
release to BCI, in any way relating to his employment with BCI, including his
separation from employment or his investment in Market Partners, L.L.C. or Bagel
Store
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Development Funding, L.L.C., except for his rights described in this Agreement,
rights under the Company's Director and Officer Insurance Policy and under the
indemnification provisions of the Company's Certificate of Incorporation, in
each case as they relate to his duties and service as an officer and director of
the Company, and his COBRA, unemployment compensation and worker's compensation
rights, if any. Zwain acknowledges and agrees that the legal rights and claims
that he is giving up include, but are not limited to, his rights, if any, under
all state and federal statutes that protect him from discrimination in
employment on the basis of sex, race, national origin, religion, disability and
age, such as the Age Discrimination in Employment Act of 1987, Title VII of the
Civil Rights Act of 1964, as amended, the Rehabilitation Act of 1973, the
Americans With Disabilities Act, the Family and Medical Leave Act, the Equal Pay
Act, and the Colorado Civil Rights Act, as well as all common law rights and
claims, such as breach of contract, express or implied, tort, whether negligent
or intentional, wrongful discharge and any claim for fraud, omission or
misrepresentation against the Released Parties.
(ii) Zwain is not releasing Market Partners, L.L.C. or Bagel Store
Development Funding, L.L.C. or their successors and assigns with respect to any
rights he may have against such entities, including any rights as an investor.
(iii) In the event that Zwain, or any of his successors, assigns or legal
representatives brings any action or legal claim against the Released Parties
that he has released herein, he will be in material breach of this Agreement and
will be obligated to pay, among other fees and expenses, all legal fees and
other costs and expenses incurred by any of the Released Parties in defending
such action or legal claim. Zwain acknowledges that he has up to twenty-one
(21) days after he has received this Agreement to consider whether to sign it.
In addition, after he has signed and delivered this Agreement to the Company, it
will not be effective or enforceable until the end of a seven-day (7) revocation
period beginning the day that he delivers it to the Company. During this seven-
day (7) period, Zwain may revoke this Agreement, without reason and in his sole
judgment, but he may do so only by delivering a written statement of revocation
to BCI as provided in Section 17. If BCI does not receive Zwain's written
statement of revocation by the end of the revocation period, then this Agreement
will become legally enforceable and Zwain may not thereafter revoke it. Any
termination of this Agreement in accordance with its terms shall not effect the
validity of the release contained in this Section 2.
(b) BCI hereby acknowledges and agrees that its obligations described
herein are in partial consideration of its release of any right to bring any
legal claim against Zwain of any nature related in any way, directly or
indirectly, to his employment relationship with BCI. This release is intended
to be interpreted in the broadest possible manner in favor of Zwain to include
all actual or potential legal claims that BCI may have against Zwain, except as
specifically provided otherwise herein. Specifically BCI acknowledges and
agrees that it, for itself and its successors and assigns, fully and forever
releases and discharges Zwain, his successors, assigns, and legal
representatives (collectively the "Released Parties") from and against any and
all claims, liabilities, demands, obligations, damages, actions, or causes of
actions of any nature or type whatsoever, whether or not presently known,
including future claims, liabilities, demands, obligations, damages, actions or
causes of action if based in whole or part on acts or omissions occurring before
it delivers this release to Zwain, in any way relating to his employment with
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BCI, except for its rights described in this Agreement and the Confidentiality
and Non-Compete Agreement, and any such claims, liabilities, demands,
obligations, damages, actions, or causes of action involving fraudulent actions
or intentional misconduct involving personal dishonesty.
3. Confidentiality and Non-Compete Agreement. Zwain acknowledges that
the Confidentiality and Non-Compete Agreement remains in full force and effect
and that any breach of that agreement shall be deemed to be a breach of this
Agreement which shall terminate this Agreement and the Company's obligations
hereunder immediately.
4. Resignation from the Board of Directors. Zwain hereby resigns as a
director of the Company, effective immediately.
5. Interest in Options to Acquire Common Stock of BCI and ENBC. Zwain
acknowledges and agrees that all of his options to acquire from the company
shares of common stock of BCI or Einstein/Noah Bagel Corporation (ENBC) have
terminated and that he has no further right to exercise such options or to
acquire from the Company any such shares of common stock.
6. Future Cooperation. Zwain agrees to cooperate in good faith with the
Company in any third-party litigation instituted by or against the Company with
respect to matters which occurred during the period in which Zwain was employed
by or served as a director or officer of the Company. The Company agrees to
reimburse Zwain for reasonable expenses incurred by him in connection with such
cooperation with respect to such matters.
7. Independent Contractor. Zwain shall be considered an independent
contractor for purposes of this Agreement, and in connection therewith, except
as specifically provided in Section 1 hereof, shall not be entitled to employee
benefits normally associated with employment of individuals by the Company.
Zwain shall assume all liabilities for all taxes on any amounts received by him
hereunder, and except as specifically provided in Section 1 hereof, the Company
shall not be required to, but may if legally required, withhold taxes on such
amounts.
8. Communications. Zwain and the Company each agree not to disparage, or
otherwise speak negatively of, the other. The Company further agrees to use
reasonable best efforts to cause its directors, officers and employees not to
disparage, or otherwise speak negatively of, Zwain. Zwain further agrees not to
disparage, or otherwise speak negatively of, any BCI service-marked or
trademarked concept, or past or present employee, officer or director of BCI.
The Company agrees to provide Zwain, to the extent he is available, the
opportunity to review any press release to be issued by the Company that
mentions his name, provided, however, that this section shall not be interpreted
to limit Company's ability to issue any press release that mentions Zwain's name
that the Company deems necessary, based on the advice of its counsel, with or
without Zwain's review. Zwain agrees to provide BCI the opportunity to review
any press release to be issued by Zwain that mentions BCI, provided, however,
that Zwain shall not be obligated to provide BCI such opportunity in connection
with any press release he may choose to issue for the purpose of responding to
any press release issued by BCI
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that identifies him by name and that he was not given an opportunity to review
or that did not reflect any comments made by him in his review.
9. Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such a manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of the Agreement.
10. Descriptive Headings. The descriptive headings used herein are
inserted for convenience only and do not constitute a part of this Agreement.
11. Governing Law. This Agreement and the rights and obligations of the
parties hereto shall be governed, construed and enforced in accordance with the
internal laws of the state of Colorado applicable to contracts made and to be
performed therein.
12. Complete Agreement. This Agreement and the Confidentiality and Non-
Compete Agreement embody the complete agreement and understanding between the
parties with respect to the subject matter hereof, and supersede and preempt any
prior understanding, agreement, or representation by or between the parties,
written or oral, which may have related to the subject matter hereof.
13. Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original.
14. Amendment. The parties hereto may amend, modify and supplement this
Agreement in such a manner as may be agreed upon by them in writing.
15. Waiver. The waiver by either party of a breach of any provision of
this Agreement by the other party shall not operate or be construed as a waiver
of any subsequent breach by such other party.
16. Notices. Any notice, request, information or other document to be
given hereunder shall be in writing and delivered personally, sent by facsimile
transmission or registered or certified mail, postage prepaid, or overnight
delivery service, as follows:
If to the Company:
Boston Chicken, Inc.
00000 Xxxxxx Xxxx Xxxxxxx
Xxxxxx, XX 00000
Attention: Xxxx Xxx, Chief Personnel Officer
Facsimile: (000) 000-0000
If to Zwain:
Xxxxxxxx Xxxxx
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00000 Xxx Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
Either party may change the address to which notices hereunder are to be sent to
it by giving written notice of such change of address in the manner herein
provided for giving notice.
17. Expenses. BCI agrees to reimburse Zwain for the fees and
expenses of Xxxxxxx & Xxxxxxxxx, counsel to Zwain, incurred in connection with
the negotiation, execution and delivery of this Agreement, such amount in no
event to exceed $10,000. Except as provided in the preceding sentence, each
party hereto shall pay its own legal fees and expenses incurred in negotiating
and executing this Agreement.
18. Survival of Certain Provisions. The provisions of Sections 6
and 8 shall survive any termination of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
Consultant BOSTON CHICKEN, INC.
/s/ Xxxxxxxx Xxxxx By: /s/ Xxxxxxxx Xxx
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Xxxxxxxx Xxxxx Name: Xxxxxxxx Xxx
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Title: Chief Personnel Officer
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