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EXHIBIT 10(o)
EMPLOYMENT AGREEMENT
THIS AGREEMENT, made and entered into as of the 30th day of November,
1998, by and between RARE HOSPITALITY INTERNATIONAL, INC., a Georgia corporation
(hereinafter referred to as the "Company"), and XXXXXX X. XXXXXXX, a resident of
the Commonwealth of Massachusetts (hereinafter referred to as the "Executive").
WITNESSETH:
The Company is engaged in the business of owning, operating and
franchising the operation of restaurants under the names LongHorn Steakhouse(R),
The Capital Grille(R), Bugaboo Creek Steak House(R) and others. The Company
desires to employ Executive in an executive capacity and to be assured of his
services in such capacity on the terms and conditions set forth in this
Agreement. Executive desires to accept such employment on such terms and
conditions.
In the course of Executive's employment, Executive will gain knowledge
of the business, affairs, customers, franchisees, plans and methods of the
Company, will be trained at the expense of the Company in the development,
opening, operation and management of the Company's restaurants through the use
of techniques, systems, practices and methods used and devised by the Company,
will have access to information relating to the Company's customers and their
preferences and dining habits and will become personally known to and acquainted
with the Company's suppliers and managers in the Restricted Area thereby
establishing a personal relationship with such suppliers and managers for the
benefit of the Company.
The Company would suffer irreparable harm if Executive were to use such
knowledge, information and personal relationships related to the Company and its
business that are obtained and developed in the course of Executive's employment
with the Company other than in the proper performance of his duties for the
Company.
In consideration of the sum of $1.00 in hand paid by the Company to
Executive, the receipt and sufficiency of which are hereby acknowledged, and the
mutual covenants and obligations contained herein, the Company and Executive
hereby agree as follows:
1. Employment. The Company hereby employs Executive and Executive
hereby accepts such employment and agrees to perform his duties and
responsibilities hereunder, in accordance with the terms and conditions
hereinafter set forth.
1.1. Employment Term. The employment term of this
Agreement shall commence on the date hereof (the "Commencement Date") and shall
continue as employment at will until terminated by the Company or Executive. The
period from the Commencement Date until the employment term is terminated by the
Company or Executive is hereinafter referred to as the "Employment Term."
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1.2 Duties of Executive. Executive agrees that during the
Employment Term, he will devote his full professional and business-related time,
skills and best efforts to the business of the Company, initially in the
capacity of Executive Vice President of Human Resources of the Company. In
addition, Executive shall devote his full time and his best efforts in the
performance of any other reasonable duties as may be assigned to him from time
to time by the Company. Executive shall devote all of his full professional and
business-related skills solely to the affairs of the Company. Executive shall
perform his duties under this Agreement in the Atlanta, Georgia metropolitan
area. Executive agrees to relocate his primary residence to the Atlanta, Georgia
metropolitan area by August 1, 1999. Executive acknowledges that the discharge
of his duties for the Company will involve reasonable travel from the Company's
offices in Atlanta, Georgia.
2. Compensation and Benefits.
2.1 Base Compensation. For all the services rendered by
Executive hereunder, the Company shall pay Executive a salary at the rate of
$185,000 per year plus such additional amounts, if any, as may be approved by
the Company's Board of Directors, ("Base Compensation) payable in installments
at such times as the Company customarily pays its other senior officers (but in
any event no less often than monthly). The Company agrees that the Executive's
salary will be reviewed at least annually by the Compensation Committee of the
Company's Board of Directors to determine if an increase is appropriate, which
increase shall be in the sole discretion of the Company's Board of Directors.
Executive's salary shall be prorated for any partial year during which this
Agreement remains in effect.
2.2 Bonus Awards. Beginning December 28, 1998, in
addition to the Base Compensation, during the Employment Term Executive shall be
eligible for a bonus determined and paid in accordance with the bonus program
for executive officers of the Company as approved by the Company's Board of
Directors from time to time. During the term of this Agreement, Executive's
maximum bonus potential under such bonus program shall be not less than forty
percent (40%) of Executive's base compensation for the fiscal year. Executive
must be employed by the Company on the last day of a fiscal year in order to be
entitled to a bonus for that year.
2.3 Stock Options. (a) The Company shall grant to
Executive, effective as of the Commencement Date, the following incentive stock
options to acquire shares of the Company's common stock:
(i) an option to acquire a number of whole
shares equal to (x) $100,000 divided by (y) the fair market value of
the Company's common stock on the date of the grant, with an exercise
price equal to the fair market value of the Company's common stock on
the date of grant, which option shall become exercisable on the first
anniversary of the date of this Agreement; and
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(ii) an option to acquire a number of whole
shares equal to (x) $100,000 divided by (y) the sum of the fair market
value of the Company's common stock on the date of grant plus $2.00 per
share, with an exercise price equal to the sum of the fair market value
of the Company's common stock on the date of grant plus $2.00 per
share, which option shall become exercisable on the second anniversary
of the date of this Agreement; and
(iii) an option to acquire a number of whole
shares equal to (x) $100,000 divided by (y) the sum of the fair market
value of the Company's common stock on the date of grant plus $2.00 per
share, with an exercise price equal to the sum of fair market value of
the Company's common stock on the date of grant plus $2.00, which
option shall become exercisable on the third anniversary of the date of
this Agreement.
The options granted to Executive in this Section 2.3(a) shall be granted
pursuant to the Company's 1997 Long-Term Incentive Plan and the terms and
conditions governing such options shall be as set forth in the form of Stock
Option Agreement attached hereto as Exhibit A and made a part hereof.
(b) The Company shall grant to Executive, effective as of
the Commencement Date, the following non-qualified stock options to acquire
shares of the company's common stock;
(i) an option to acquire a number of whole
shares equal to (x) 10,000 less (y) the number of shares subject to the
option described in Section 2.3(a)(i), with an exercise price equal to
the fair market value of the Company's common stock on the date of
grant, which option shall become exercisable on the first anniversary
of the date of this Agreement; and
(ii) an option to acquire a number of whole
shares equal to (x) 10,000 less (y) the number of shares subject to the
option described in Section 2.3(a)(ii), with an exercise price equal to
the sum of the fair market value of the Company's common stock on the
date of grant plus $2.00 per share, which option shall become
exercisable with respect to all of such shares on the second
anniversary of the date of this Agreement; and
(iii) an option to acquire a number of whole
shares equal to (x) 10,000 less (y) the number of shares subject to the
option described in Section 2.3(a)(iii) with an exercise price equal to
the sum of the fair market value of the Company's common stock on the
date of grant plus $2.00 per share, which option shall become
exercisable with respect to all of such shares on the third anniversary
of the date of this Agreement;
The options granted to Executive in this Section 2.3(b) shall be granted to
Executive pursuant to the Company's 1997 Long-Term Incentive Plan and the terms
and conditions
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governing such options shall be as set forth in the form of Stock Option
Agreement attached hereto as Exhibit B and made a part hereof.
2.4 Other Benefits. In addition to all other compensation
paid or payable from the Company to Executive hereunder, during the Employment
Term Executive shall be entitled to participate in any and all other employee
benefit programs maintained by the Company for the benefit of its executive
employees generally, in accordance with and subject to the terms and conditions
of such programs.
2.5 Expenses. In addition to the compensation described
in this Agreement, the Company shall promptly reimburse Executive for all
reasonable expenses incurred by him in the performance of his duties under this
Agreement and vouched to the reasonable satisfaction of the Board of Directors
or appropriate officers of the Company, pursuant to established procedures.
2.6 Additional Bonus.Simultaneously with the execution of
this Agreement, the Company agrees to lend to Executive the sum of Forty
Thousand Dollars ($40,000.00) which loan will be evidenced by a promissory note
in the form of Exhibit E attached hereto and made a part hereof (the "Note"). As
provided in the Note, this loan will be without interest prior to maturity and
will be payable on demand at any time following the termination of the
employment of Executive either by the Company for Cause or by Executive, which
termination occurs within two years following the date of this Agreement. If
Executive remains employed by the Company on the date that is two years
following the date of this Agreement, the Company agrees that the entire
principal amount of the Note shall be forgiven as additional compensation to
Executive for his services under this Agreement.
3. Payment upon Termination.
(a) Upon termination of the Employment Term for any
reason other than (i) Executive's death, or (ii) by the Company other than for
Cause (as defined in Exhibit C attached hereto) or (iii) by the Company during
Executive's Disability (as defined in Exhibit C attached hereto), Executive
shall be entitled to receive the compensation owed to Executive but unpaid for
performance rendered under this Agreement as of the date of termination and any
additional compensation he may be entitled to receive under the terms of any
employee benefit plan.
(b) Upon termination of the Employment Term by the death
of Executive, Executive's estate shall be entitled to receive the compensation
under Section 2.1 as calculated and owed to Executive but unpaid for performance
rendered under this Agreement as of the date of termination and any additional
compensation he may be entitled to receive under the terms of any employee
benefit plan plus the Company will pay to the personal representative of
Executive, a lump sum amount equal to one-half of Executive's annual Base
Compensation under Section 2.1 as in effect on the date of his death plus, to
the extent reasonably calculable under any bonus program then applicable to
Executive, a pro rata portion (calculated as of the date of Executive's death)
of the bonus
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that Executive would have earned if Executive had remained employed by the
Company at the end of the fiscal year in which his death occurred.
(c) In the event that during the Employment Term
Executive becomes Disabled and the Company thereafter terminates Executive's
employment during the continuation of such Disability, Executive shall be
entitled to receive the compensation under Section 2.1 as calculated and owed to
Executive but unpaid for performance rendered under this Agreement as of the
date of termination and any additional compensation he may be entitled to
receive under the terms of any employee benefit plan plus, to the extent
reasonably calculable under any bonus program then applicable to Executive, a
pro rata portion (calculated as of the date of Executive's Disability) of the
bonus that Executive would have earned if Executive had remained employed by the
Company at the end of the fiscal year in which his Disability occurred. In
addition, the Company shall pay to Executive, for up to ninety (90) days, an
amount equal to the difference between the amount of Executive's then level of
Base Compensation payable pursuant to Section 2.1 and 150% of the amount paid to
Executive under any short-term disability insurance policy obtained by the
Executive and paid by the Company through the Company's group coverage until the
Company's long-term disability insurance begins to pay.
(d) In the event that within two (2) years following the
Commencement Date the Company terminates Executive's employment other than for
Cause, unless the provisions of Section 3(f) apply, Executive shall be entitled
to receive the compensation under Section 2.1 as calculated and owed to
Executive but unpaid for performance rendered under this Agreement as of the
date of termination and the Company will be obligated to pay Executive his
annual Base Compensation under Section 2.1 as of the date of termination of such
employment from the date of such termination for twelve (12) months. Such
payment shall be made as and when otherwise due under this Agreement.
(e) In the event that at any time that is more than two
(2) years following the Commencement Date the Company terminates Executive's
employment other than for Cause, unless the provisions of Section 3(f) apply,
Executive shall be entitled to receive the compensation under Section 2.1 as
calculated and owed to Executive but unpaid for performance rendered under this
Agreement as of the date of termination and the Company will be obligated to pay
Executive at the rate of his annual Base Compensation under Section 2.1 as of
the date of termination of such employment from the date of such termination for
six (6) months. Such payment shall be made as and when otherwise due under this
Agreement.
(f) In the event that the Company terminates Executive's
employment other than for Cause within eighteen (18) months following the
occurrence of a Change in Control (as defined in Exhibit C attached hereto), in
lieu of the amounts payable pursuant to Section 3(d) or (e) Executive shall be
entitled to receive the compensation under Section 2.1 as calculated and owed to
Executive but unpaid for performance rendered under this Agreement as of the
date of termination of such employment and the Company will be
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obligated to pay Executive an additional amount equal to the sum of (x) his
annual Base Compensation as of the date of termination of such employment plus
(y) an amount equal to the bonus paid to Executive pursuant to Section 2.2 for
the calendar year immediately preceding the calendar year in which the
termination of employment occurs. Such payment shall be made within thirty (30)
days following termination of Executive's employment.
(g) Payments made pursuant to this Section 3 are in lieu
of any other obligations to Executive pursuant to the terms of this Agreement.
4. Noncompetition. Executive covenants and agrees that during the
term of his employment by the Company and for a period of one (1) year
immediately following the termination of Executive's employment by the Company
for any reason whatsoever, Executive will not, within the area described on
Exhibit D hereto (the "Restricted Area") directly or indirectly compete with the
Company by carrying on a business any significant portion of which involves the
development, opening, operation or franchising of restaurants that derive more
than thirty percent (30%) of their food sales from steak products, if the
Company is still engaged in such business in such area.
4.1 Definition of "Compete." For the purposes of this
Agreement, the term "compete" shall mean the providing of general management or
supervisory services for the development or operation or franchising of
restaurants that derive more than thirty percent (30%) of their food sales from
steak products.
4.2 Direct or Indirect Competition. For the purposes of
this Agreement, the words "directly or indirectly" as they modify the word
"compete" shall mean (i) acting as an agent, representative, consultant,
officer, director, independent contractor, or employee engaged in a management
capacity with any entity or enterprise which is carrying on a business any
significant portion of which involves the development, opening, or operation of
restaurants offering steak as a principal portion of their menu, (ii)
participating in any such competing entity or enterprise as an owner, partner,
limited partner, joint venturer, creditor or stockholder (except as a
stockholder holding less than one percent (1%) interest in a corporation whose
shares are actively traded on a regional or national securities exchange or in
the over-the-counter market), and (iii) communicating to any such competing
entity or enterprise the names or addresses or any other information concerning
any employee or supplier of the Company or any successor to the goodwill of the
Company with respect to the business of the Company.
5. Confidentiality. Executive recognizes and acknowledges that by
reason of his employment by and service to the Company, he will have access to
all trade secrets and other confidential information of the Company including,
but not limited to, confidential: pricing information, marketing information,
sales techniques of the Company, confidential records, the Company's expansion
plans, restaurant development and marketing techniques, operating procedures,
training programs and materials, business plans, franchise arrangements, plans
and agreements, information regarding suppliers, product
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quality and control procedures, financial statements and projections and other
information regarding the operation of the Company's restaurants (hereinafter
referred to as the "Confidential Information"). Executive acknowledges that such
Confidential Information is a valuable and unique asset of the Company and
covenants that he will not, either during the term of his employment by the
Company or for a period of two (2) years thereafter, disclose any such
Confidential Information to any person for any reason whatsoever (except as his
duties for the Company may require) without the prior written authorization of
the Company's Board of Directors. Executive agrees that he will not copy any
Confidential Information except as the performance of his duties for the Company
may require and that upon the termination of his employment by the Company, he
shall return all Confidential Information and any copies thereof in his
possession to the Company. Executive hereby acknowledges and agrees that the
prohibitions against disclosure of Confidential Information recited herein are
in addition to, and not in lieu of, any rights or remedies which the Company may
have available pursuant to the laws of any jurisdiction or at common law to
prevent the disclosure of trade secrets or proprietary information, and the
enforcement by the Company of its rights and remedies pursuant to this Agreement
shall not be construed as a waiver of any other rights or available remedies
which it may possess in law or equity absent this Agreement. Notwithstanding the
foregoing, the Company acknowledges and agrees that nothing contained herein
shall restrict or otherwise prohibit or prevent (i) disclosure of Confidential
Information pursuant to legal proceedings, subpoena, civil investigative demand
or other similar process. Executive agrees that if disclosure of Confidential
Information is requested or required pursuant to any such process, he shall
provide the Company with prompt written notice of any such request or
requirement so that the Company may seek a protective order or other appropriate
remedy and/or waive compliance with the provisions of this Agreement. If, in the
absence of a protective order or other remedy or the receipt of a waiver by the
Company, Executive is nonetheless, legally compelled to disclose Confidential
Information to any tribunal or other agency, Executive may, without liability
hereunder, disclose to such tribunal or other agency only that portion of the
Confidential Information which Executive is legally required to disclose,
Executive agrees to cooperate with the Company to obtain an appropriate
protective order or other reliable assurance that such tribunal or other agency
will accord the Confidential Information confidential treatment. The Company
also acknowledges and agrees that Confidential Information shall not include any
information (a) known by Executive prior to the date of his employment by the
Company and learned by Executive other than as a result of his employment
relationship with the Company, (b) independently developed by the Executive
outside of the scope of his employment relationship with the Company or (c) is
or becomes publicly available through no breach by the Executive of his
obligation to the Company.
6. Non-Solicitation of Employees. Executive covenants that during
the term of his employment by the Company, and during the two (2) year period
immediately following the termination of such employment, Executive will neither
directly nor indirectly induce or attempt to induce or cause any employee of the
Company to terminate his or her employment to go to work for any other employer
in a business competing with that of the Company.
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7. Hiring of Employees. Executive covenants that during the term
of his employment by the Company, and during the one (1) year period immediately
following the termination of such employment, Executive will neither directly
nor indirectly hire any salaried employee of the Company.
8. Property of Company. Executive acknowledges that from time to
time in the course of providing services pursuant to this Agreement he shall
have the opportunity to inspect and use certain property, both tangible and
intangible, of the Company, and Executive hereby agrees that said property shall
remain the exclusive property of the Company and the Executive shall have no
right or proprietary interest in such property, whether tangible or intangible,
including, without limitation, the Company's franchise and supplier lists,
contract forms, books of account, training and operating materials and similar
property.
9. Developments. All developments, including inventions, whether
patentable or otherwise, trade secrets, discoveries, improvements, ideas and
writings which either directly or indirectly relate to or may be useful in the
business of the Company or any of its affiliates (the "Developments") which
Executive, either by himself or in conjunction with any other person or persons,
has conceived, made, developed, acquired or acquired knowledge of during his
employment by the Company or which Executive, either by himself or in
conjunction with any other person or persons, shall conceive, make, develop,
acquire or acquire knowledge of during the Employment Term, shall become and
remain the sole and exclusive property of the Company. Executive hereby assigns,
transfers and conveys, and agrees to so assign, transfer and convey, all of his
right, title and interest in and to any and all such Developments and to
disclose fully as soon as practicable, in writing, all such Developments to the
Chairman of the Company. At any time and from time to time, upon the request and
at the expense of the Company, Executive will execute and deliver any and all
instruments, documents and papers, give evidence and do any and all other acts
which, in the opinion of counsel for the Company, are or may be necessary or
desirable to document such transfer or to enable the Company to file and
prosecute applications for and to acquire, maintain and enforce any and all
patents, trademark registrations or copyrights under United States or foreign
law with respect to any such Developments or to obtain any extension,
validation, reissue, continuance or renewal of any such patent, trademark or
copyright. The Company will be responsible for the preparation of any such
instruments, documents and papers and for the prosecution of any such
proceedings and will reimburse Executive for all reasonable expenses incurred by
him in compliance with the provisions of this Section.
10. Reasonableness. The restrictions contained in Sections 4,5,6
and 7 are considered by the parties hereto to be fair and reasonable and
necessary for the protection of the legitimate business interests of the
Company.
11. Equitable Relief. Executive acknowledges that the services to
be rendered by him are of a special, unique, unusual, extraordinary, and
intellectual character, which gives them a peculiar value, and the loss of which
cannot reasonably or adequately be
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compensated in damages in an action at law; and that a breach by him of any of
the provisions contained in Sections 4, 5, 6 and 7 of this Agreement will cause
the Company irreparable injury and damage. Executive further acknowledges that
he possesses unique skills, knowledge and ability and that any material breach
of the provisions of Sections 4, 5, 6 and 7 of this Agreement would be extremely
detrimental to the Company. By reason thereof, Executive agrees that the Company
shall be entitled, in addition to any other remedies it may have under this
Agreement or otherwise, to injunctive and other equitable relief to prevent or
curtail any breach of the provisions of Sections 4, 5, 6 and 7 of this Agreement
by him.
12. Survival of Provisions. The provisions of Sections 4 through
14 , inclusive, of this Agreement shall survive the termination of this
Agreement to the extent required to give full effect to the covenants and
agreements contained in those sections. All provisions of this Agreement which
contemplate the making of payments or the provision of consideration or other
items of economic value by the Company to the Executive after the termination of
this Agreement shall likewise survive the termination of this Agreement to the
extent required to give full effect to such undertakings or obligations of the
Company to Executive hereunder.
13. Warranties and Representations. In order to induce the Company
to enter into this Employment Agreement, Executive hereby warrants and
represents to the Company that Executive is not under any obligation,
contractual or otherwise, to any party which would prohibit or be contravened by
Executive's acceptance of employment by the Company and the performance of
Executive's duties as Executive Vice President of Human Resources of the Company
or the performance of Executive's obligations under this Agreement.
14. Successors Bound; Assignability. This Agreement shall be
binding upon Executive, the Company and their successors in interest, including
without limitation, any corporation into which the Company may be merged or by
which it may be acquired. This Agreement is nonassignable except that the
Company's rights, duties and obligations under this Agreement may be assigned to
the Company's acquiror in the event the Company is merged, acquired or sells
substantially all of its assets.
15. Severability. In the event that any one or more of the
provisions of this Agreement or any word, phrase, clause, sentence or other
portion thereof shall be deemed to be illegal or unenforceable for any reason,
such provision or portion thereof shall be modified or deleted, to the extent
permissible under applicable law, in such a manner so as to make this Agreement
as modified legal and enforceable to the fullest extent permitted under
applicable laws.
16. Withholding. Notwithstanding any of the terms or provisions of
this Agreement, all amounts payable by the Company hereunder shall be subject to
withholding of such sums related to taxes as the Company may reasonably
determine it should withhold pursuant to applicable law or regulation.
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17. Headings. The headings and captions used in this Agreement are
for convenience of reference only, and shall in no way define, limit, expand or
otherwise affect the meaning or construction of any provision of this Agreement.
18. Notices. Any notice required or permitted to be given pursuant
to this Agreement shall be deemed sufficiently given when delivered in person or
when deposited in the United States mail, registered or certified mail, postage
prepaid, addressed as follows:
If to the Company, to: RARE Hospitality International, Inc.
0000 Xxxxxxx Xxxx
Xxxxxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Chief Executive Officer
With a copy to: Xxxxxx & Bird
One Atlantic Center
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxx
If to Executive, to: Xxxxxx X. Xxxxxxx
000 Xxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxxxxx 00000
Any party may by written notice change the address to which notices to such
party are to be delivered or mailed.
19. Entire Agreement. This Agreement, together with Exhibits A, B,
C and D hereto which are incorporated herein by this reference, constitutes the
entire Agreement between the parties hereto with regard to the subject matter
hereof, and there are no agreements, understandings, specific restrictions,
warranties or representations relating to said subject matter between the
parties other than those set forth herein or herein provided for.
20. Counterparts. This Agreement may be executed in two or more
counterparts, each of which will take effect as an original and all of which
shall evidence one and the same Agreement.
21. Amendment, Modification and Waiver. This Agreement may only be
amended, modified or terminated prior to the end of its term by the mutual
agreement of the parties. The waiver by either party to this Agreement of a
breach of any of the provisions of this Agreement shall not operate or be
construed as a waiver of any subsequent or simultaneous breach.
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22. Mitigation. Executive shall have no duty to attempt to
mitigate the compensation or level of benefits payable by the Company to him
hereunder and the Company shall not be entitled to set off against the amounts
payable by the Company to Executive hereunder any amounts received by the
Executive from any other source, including any subsequent employer.
23. Governing Law. All of the terms and provisions of this
Agreement shall be construed in accordance with and governed by the applicable
laws of the State of Georgia.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
RARE HOSPITALITY INTERNATIONAL, INC.
By: Xxxxxx X. Xxxxxx, Xx.
--------------------------
Title: President
EXECUTIVE
/s/ Xxxxxx X. Xxxxxxx
------------------------------
XXXXXX X. XXXXXXX
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INDEX TO EXHIBITS
EXHIBIT DESCRIPTION
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A INCENTIVE STOCK OPTION AGREEMENT
B NON-QUALIFIED STOCK OPTION AGREEMENT
C DEFINITIONS
D RESTRICTED AREA
E FORM OF PROMISSORY NOTE
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EXHIBIT C
DEFINITIONS
As used in Section 3 of this Agreement, the following terms shall have
the meanings ascribed to each below:
"Cause" means:
(A) Commission by Executive of a willful or grossly negligent act
which causes material harm to the Company,
(B) The commission or perpetration by Executive of any criminal
act involving a felony for which Executive is indicted or with
respect to which Executive pleads nolo contendere (or any
similar response), any act of moral turpitude, or any fraud
upon the Company,
(C) Habitual and unauthorized absenteeism by reason other than
physical or mental illness, chronic alcoholism or other form
of substance abuse resulting in material harm or actual or
potential physical danger to the Company or its employees,
(D) Any material violation by Executive of his obligations under
this Agreement or breach of his fiduciary obligations to the
Company,
(E) Any misrepresentation or breach by Executive of warranty
contained in Section 13 of this Agreement;
provided, however, that if the cause specified in notice to the
Executive of the termination of Employee's employment for Cause is such
that there is a reasonable prospect that it can be cured with diligent
effort within a reasonable time, Executive shall have such reasonable
time (having regard for the nature of the cause) to cure such cause,
which time shall not in any event exceed thirty (30) days from the date
of such notice, and Executive's employment shall continue in effect
during such reasonable time so long as Executive makes diligent efforts
during such time to cure such cause. If such cause shall be cured by
Executive during such reasonable time his employment and the
obligations of the Company hereunder shall not terminate as a result of
the notice which has been given with respect to such cause. Cure of any
cause with or without notice from the Company shall not relieve
Executive from any obligations to the Company under this Agreement or
otherwise and shall not affect the Company's rights upon the
reoccurrence of the same, or the occurrence of any other, cause. If
such cause shall not be cured within such reasonable time the
employment of Executive under this Agreement shall terminate upon the
expiration of such reasonable time.
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"Change in Control" means and includes each of the following:
(1) The acquisition by any individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the 1934 Act) (a
"Person") of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the 0000 Xxx) of 25% or more of the combined voting
power of the then outstanding voting securities of the Company entitled
to vote generally in the election of directors (the "Outstanding
Company Voting Securities"); provided, however, that for purposes of
this subsection (1), the following acquisitions shall not constitute a
Change of Control: (i) any acquisition by a Person who is on the date
of this Agreement (the "Effective Date") the beneficial owner of 25% or
more of the Outstanding Company Voting Securities, (ii) any acquisition
by the Company, (iii) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any
corporation controlled by the Company, or (iv) any acquisition by any
corporation pursuant to a transaction which complies with clauses (i),
(ii) and (iii) of subsection (3) of this definition; or
(2) Individuals who, as of the Effective Date, constitute
the Board of Directors of the Company (the "Incumbent Board") cease for
any reason to constitute at least a majority of the Board of Directors
of the Company; provided, however, that any individual becoming a
director subsequent to October 1, 1997 whose election, or nomination
for election by the Company's shareholders, was approved by a vote of
at least a majority of the directors then comprising the Incumbent
Board shall be considered as though such individual were a member of
the Incumbent Board, but excluding, for this purpose, any such
individual whose initial assumption of office occurs as a result of an
actual or threatened election contest with respect to the election or
removal of directors or other actual or threatened solicitation of
proxies or consents by or on behalf of a Person other than the Board of
Directors of the Company; or
(3) Consummation of a reorganization, share exchange,
merger or consolidation or sale or other disposition of all or
substantially all of the assets of the Company (a "Business
Combination"), in each case, unless, following such Business
Combination, (i) all or substantially all of the individuals and
entities who were the beneficial owners of the Outstanding Company
Voting Securities immediately prior to such Business Combination
beneficially own, directly or indirectly, more than 50% of the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors of the corporation resulting
from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or
all or substantially all of the Company's assets either directly or
through one or more subsidiaries) in substantially the same proportions
as their ownership, immediately prior to such Business Combination of
the Outstanding Company Voting Securities, and (ii) no Person
(excluding any corporation resulting from such Business Combination or
any employee benefit plan (or related trust) of the Company or such
corporation resulting from such Business Combination) beneficially
owns, directly or indirectly, 25% or more of the combined voting power
of the then outstanding voting securities of such corporation except to
the extent that such
-2-
15
ownership existed prior to the Business Combination, and (iii) at least
a majority of the members of the board of directors of the corporation
resulting from such Business Combination were members of the Incumbent
Board at the time of the execution of the initial agreement, or of the
action of the Board of Directors of the Company, providing for such
Business Combination; or
(4) approval by the shareholders of the Corporation of a
complete liquidation or dissolution of the Corporation.
"Disability" or "Disabled" means that by reason of any physical or mental
incapacity Executive has been unable, or it is reasonably expected that he will
be unable, for a period of at least one hundred and eighty (180) substantially
continuous days to perform his regular duties and responsibilities hereunder. In
the event of any disagreement between Executive and the Company as to whether
Executive is physically or mentally incapacitated, the question of such
incapacity shall be submitted to an impartial and reputable physician for
determination, selected by mutual agreement of Executive and the Company or,
failing such agreement, selected by two physicians (one of which shall be
selected by the Company and the other by Executive), and such determination of
the question of such incapacity by such physician shall be final and binding on
Executive and the Company. The Executive shall pay the fees and expenses of such
physician.
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16
EXHIBIT D
The area within the Metropolitan Statistical Area ("MSA") surrounding each city
listed below, as said MSA is determined from time to time by the U. S. Bureau of
the Census, or for each city with no MSA within fifty (50) miles of the city
limits.
Alabama Florida
Auburn Altamonte Springs
Birmingham Boynton Beach
Dothan Xxxxxxx
Huntsville Coral Springs
Mobile Xxxxx
Xxxxxxxxxx Destin
Ft. Lauderdale
California Ft. Xxxxx
Jacksonville Beach
San Francisco Jacksonville
Xxxxxx Beach
Connecticut Kissimmee
Lake Xxxx
Xxxxxxxx Largo
Xxxxxxx Island
Delaware Miami
Naples
Wilmington Ocala
Orlando
District of Columbia Sarasota
Xx. Xxxxxxxxx
Xx. Xxxxxxxxxx
Xxxxxxxxxxx
Xxxxx
X-0
17
Georgia Maine
Albany Augusta
Athens Bangor
Atlanta Portland
Augusta
Austell Maryland
Cartersville
Chamblee Gaithersburg
College Park
Columbus Massachusetts
Conyers
Douglasville Boston
Duluth Braintree
Gainesville Framingham
Jonesboro Milford
Kennesaw Xxxxxx
Lawrenceville North Attleboro
Macon Xxxxxxx
Xxxxxxxx Seekonk
Montgomery Watertown
Peachtree City
Rome Michigan
Roswell
Savannah Xxx Arbor
Snellville Detroit
Xxxxxx Xxxx
Valdosta
Minnesota
Illinois
Chicago Minneapolis
Vairview Heights
Missouri
Kentucky
St. Xxxxx
Xxxxxxxx
New Hampshire
Concord
Newington
New York
Albany
Poughkeepsie
Rochester
White Plains
D-2
18
North Carolina Pennsylvania
Burlington Philadelphia
Charlotte
Concord Rhode Island
Gastonia
Greensboro Providence
High Point Warwick
Huntersville
Pineville South Carolina
Winston-Salem
Columbia
Ohio Greenville
Hilton Head
Athens Spartanburg
Cincinnati
Cleveland Tennessee
Columbus
Cuyahoga Falls Antioch
Dublin Chattanooga
Fairview Park Hermitage
Xxxxxxxx Heights Xxxxxxx
Mentor Knoxville
North Canton Nashville
Xxxxx Xxxxxxx
Springdale
Strongsville Texas
Dallas
Houston
San Antonio
Executive acknowledges and agrees that the geographical area described above is
the area in which Executive will initially perform his services for the Company,
and that the area in which such services are performed is intended to expand as
the business of the Company grows. Executive and the Company agree that as the
geographical area in which the Company conducts its business expands, the list
of cities described on this Exhibit D shall be deemed to be amended, from time
to time, without any further consent, action or notice on the part of the
Company or Executive, to include each additional city in which the Company
operates a restaurant or a franchisee of the Company operates a restaurant under
the terms of a franchise from the Company. Executive agrees to execute one or
more amendments hereto upon the request of the Company from time to time in
order to confirm such amended list.
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