EXHIBIT 10.23
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into
effective as of the 1st day of January, 2004, by and between CNL RESTAURANT
INVESTMENTS, INC., a Delaware corporation ("CNL"), and XXXXXX X. XXXXXXX, XX.
("Executive").
Preliminary Statement
WHEREAS, CNL desires to continue to employ Executive, and Executive
desires to continue to be employed by CNL; and
WHEREAS, CNL and Executive desire to enter into this Agreement which
sets forth the terms and conditions of Executive's employment by CNL.
NOW, THEREFORE, in consideration of the mutual covenants set forth
below, the Company and Executive agree as follows:
1. Employment. CNL hereby employs the Executive, and Executive agrees
to serve CNL, for the period and upon terms and conditions set forth below.
Except as otherwise provided in this Agreement, Executive's employment shall be
subject to the employment policies and practices of CNL in effect from time to
time during the term of Executive's employment.
2. Term of Agreement. The term of Executive's employment pursuant to
this Agreement shall commence on January 1, 2004 (the "Effective Date"), and
shall continue in effect for a period of twelve (12) months to and including
December 31, 2004, unless terminated earlier in accordance with Section 5 below.
Thereafter, this Agreement may be renewed by CNL for additional one-year terms,
upon written notice by CNL to Executive no later than sixty (60) days prior to
the termination date of any such term, unless terminated sooner in accordance
with Section 5 below. (The natural termination date of the initial term or any
successive term of this Agreement shall be referred to as the "Termination
Date.")
3. Position and Duties. Executive shall serve as the Senior Vice
President of CNL and shall have such duties, authority and responsibilities as
are normally associated with and appropriate for such position, and shall
perform such other services for CNL consistent with such position as may be
reasonably assigned to him by the CEO of CNL. Executive shall devote
substantially all of his working time and efforts to the business and affairs of
CNL, except that Executive may engage in personal or charitable activities which
do not interfere with Executive's employment duties. Executive shall comply with
the policies, standards, and regulations established from time to time by CNL.
4. Compensation and Related Matters.
4.1 Base Salary. During the term of this Agreement, CNL shall pay to
Executive a base salary at an annual rate as specified in Attachment "A" to this
Agreement ("Base Salary"). The Base Salary shall be paid in equal installments
in accordance with CNL's usual and customary payroll practices, but not less
frequently than monthly. The Base Salary may be increased each year in the sole
and absolute discretion of CNL's Board of Directors.
4.2 Bonus and Additional Compensation. Executive may be entitled to
an annual bonus as set forth in Attachment "A". Pending CNL's approval,
Executive may also be entitled to participate in a long-term compensation
program to be implemented by CNL at a later date.
4.3 Benefit Plans and Arrangements. Executive shall be entitled, to
the extent Executive is eligible, to participate in and to receive benefits
under all existing and future employee benefit plans, perquisites and fringe
benefit programs of CNL that are provided generally to other similarly situated
executives of CNL, on terms similar to those provided to such other executives.
4.4 Expenses. CNL shall reimburse Executive for all reasonable and
customary expenses incurred by Executive in performing services for CNL,
including all reasonable and customary expenses of travel while away from home
on business or at the request of and in the service of CNL, provided that such
expenses are incurred and accounted for by Executive in accordance with the
policies and procedures established from time to time by CNL.
4.5 Paid Time Off. Executive shall be entitled to no fewer than
twenty (20) days of paid time off (PTO) per year.
5. Termination. The term of Executive's employment pursuant to this
Agreement may be terminated under the following circumstances:
5.1 Death. The term of Executive's employment shall terminate upon
his death.
5.2 Disability. CNL may terminate the term of Executive's employment
as a result of Executive's Disability. For purposes of this Agreement,
"Disability" is defined as the inability, by reason of illness or other physical
or mental incapacity or limitation, of Executive substantially to perform the
duties of his employment with the Company, as determined in good faith by CNL,
which inability continues for at least one hundred twenty (120) consecutive
days, or for shorter periods aggregating one hundred twenty (120) days during
any consecutive twelve (12) month period.
5.3 By CNL for Cause. CNL may terminate the term of Executive's
employment for "Cause" upon written notice to Executive. For purposes of this
Agreement, CNL shall have "Cause" to terminate Executive's employment upon any
of the following events:
(a) Executive's continued failure to perform, or his habitual
neglect of, his duties and obligations hereunder;
(b) Executive's conviction of, or plea of guilty or nolo contendre
to, an indictment or information, or an indictment or
information is filed against Executive and is not discharged or
otherwise resolved within twelve (12) months thereafter, and
said indictment or information charged Executive with a felony,
any crime involving moral turpitude, or any crime which is
likely to result in material injury to CNL;
(c) Executive's breach of a fiduciary duty relating to the
Executive's employment with CNL, including but not limited to an
act of fraud, theft or dishonesty; or
(d) Executive's material breach of this Agreement;
Notwithstanding the foregoing, Executive shall not be deemed to have
been terminated for Cause under subsections (a) or (d) unless CNL provided
written notice to the Executive setting forth in reasonable detail the reasons
for CNL's intention to terminate for Cause, and Executive failed within thirty
(30) days to cure the event or deficiency set forth in the written notice.
5.4 By CNL Without Cause. CNL may terminate the term of Executive's
employment other than for Cause, death or Disability at any time upon sixty (60)
days prior written notice to Executive.
5.5 By Executive for Good Reason. Executive may terminate the term
of his employment for "Good Reason" upon written notice to CNL. For purposes of
this Agreement, "Good Reason" shall include the following events unless
otherwise consented to by Executive:
(a) The assignment to Executive of any duties materially
inconsistent with Executive's position, duties, responsibilities
and status within CNL;
(b) A material reduction in Executive's reporting responsibilities
not pertaining to job performance issues;
(c) A reduction in the Base Salary of the Executive not pertaining
to job performance issues;
(d) A requirement by CNL that Executive's work location be moved
more than fifty (50) miles from CNL's principal place of
business in Orlando, Florida;
(e) CNL's material breach of this Agreement; or
(f) CNL's failure to obtain an agreement from any successor to the
business of CNL by which the successor assumes and agrees to
perform this Agreement.
(g) A "change in control" (as defined below) of CNL occurs.
Notwithstanding the foregoing, Executive shall not be deemed to have
terminated his employment for Good Reason under subsections (a), (b), (c), or
(d), unless Executive provided written notice to CNL setting forth in reasonable
detail the reasons for Executive's intention to terminate his employment for
Good Reason, and CNL failed within thirty (30) days to cure the event or
deficiency set forth in the written notice.
For purposes of this Section 5.5, a "change in control" means that an
act specified in Sections 5.5(a) through 5.5(e) of the Agreement occurs and,
within two (2) years of that act, one of the following events also occurs: (A)
the closing of any sale by CNL Restaurant Properties, Inc. (f/k/a CNL American
Properties Fund, Inc.), a Maryland corporation ("APF"), of all or substantially
all of its assets to an acquiring person or entity that is not an affiliate of
APF, CNL Holdings, Inc., a Florida corporation ("CHI"), Xxxxx X. Xxxxxx, Xx.
("Xxxxxx") or any of their affiliates; (B) the closing of any sale by APF of all
or a majority of the shares of stock of CNL that it owns to an acquiring person
or entity that is not an affiliate of APF, CHI, Seneff, or any of their
affiliates; or (C) the closing of any sale by the holders of voting common stock
of APF of an amount of voting common stock that equals or exceeds a majority of
the shares of voting common stock of APF immediately prior to such closing to a
person or entity that is not CHI, Seneff, or any of their affiliates, such that
the holders of such voting common stock immediately prior to the closing are not
the holders of a majority of the voting common stock of APF after the closing.
5.6 By Executive Without Good Reason. Executive may terminate the
term of Executive's employment other than for Good Reason at any time upon sixty
(60) days prior written notice to CNL
6. Compensation in the Event of Termination. Upon the termination of
this Agreement, CNL shall pay Executive compensation as set forth below:
6.1 By CNL Without Cause; By Executive for Good Reason. In the event
that Executive's employment is terminated by CNL without Cause, or by the
Executive for Good Reason, CNL shall pay the Executive a cash payment equal to
one (1) times the Executive's Base Salary, which is in effect on the date of the
Executive's termination (the "Severance Payment"). The Severance Payment shall
be made payable in equal installments over a twelve (12) month period in
accordance with CNL's usual and customary payroll practices, commencing on the
first payday following Executive's termination. Within thirty (30) days of the
date of termination of Executive's employment, CNL shall also pay Executive a
lump sum equal to the sum of: (a) any accrued but unpaid Base Salary and
vacation due Executive as of the date of termination of employment; and (b)
reimbursements for appropriately submitted expenses which have been incurred,
but have not been paid by CNL, as of the date of termination.
6.2 By CNL for Cause; By Executive Without Good Reason. In the event
that CNL terminates Executive's employment for Cause, or Executive terminates
his employment without Good Reason, all compensation or benefits to which
Executive may otherwise be entitled to shall cease on the date of termination,
except for (a) any accrued but unpaid Base Salary due Executive as of the date
of termination of employment, and (b) reimbursements for appropriately submitted
expenses which have been incurred, but have not been paid by CNL, as of the date
of termination.
6.3 Death or Disability. In the event that CNL terminates
Executive's employment due to his death or Disability, the Company shall pay the
Executive or his estate a lump sum equal to one (1) times Executive's Base
Salary, payable within thirty (30) days of Executive's termination. This payment
shall be in addition to, rather than in lieu of, the entitlement of Executive or
his estate to any other insurance or benefit proceeds as a result of his death
or Disability.
6.4 Natural Termination. In the event that Executive's employment by
CNL pursuant to this Agreement naturally terminates on the Termination Date, all
compensation or benefits to which Executive may otherwise be entitled to shall
cease on the Termination Date, except for (i) any accrued but unpaid Base Salary
due Executive as of the Termination Date, and (ii) reimbursements for
appropriately submitted expenses which have been incurred, but have not been
paid by CNL, as of the Termination Date; provided, however, that at the election
of CNL in its sole and absolute discretion and upon written notice to the
Executive on or prior to the Termination Date, CNL shall pay the Executive a
cash payment equal to one (1) times the Executive's Base Salary which is in
effect on the Termination Date, which cash payment shall be made payable over a
twelve (12) month period in equal installments in accordance with CNL's usual
and customary payroll practices, commencing on the first payday following the
Termination Date (the "Optional Severance Payment").
7. Non-Competition; Non-Solicitation; and Confidentiality.
7.1 Confidential Information. Executive acknowledges that CNL shall
provide Executive with confidential and proprietary information regarding the
business in which CNL and its current or future parent company, subsidiaries and
other affiliates (the "CNL Affiliates") are involved, and CNL will also provide
Executive with "trade secrets", as defined in Section 688.002(4) of the Florida
Statutes, of CNL and the CNL Affiliates (hereinafter all such confidential and
proprietary information and trade secretes are referred to as the "Confidential
Information"). For purposes of this Agreement, "Confidential Information"
includes, but is not limited to:
(a) Information related to the business of CNL and the CNL
Affiliates, including but not limited to marketing strategies
and plans, sales procedures, operating policies and procedures,
pricing and pricing strategies, business and strategic plans,
financial statements and projections, accounting and tax
positions and procedures, and other business and financial
information of CNL and the CNL Affiliates;
(b) Information regarding the customers of CNL and the CNL
Affiliates which Executive acquired as a result of his
employment with CNL, including but not limited to, customer
contracts, work performed for customers, customer contacts,
customer requirements and needs, data used by CNL and the CNL
Affiliates to formulate customer bids, customer financial
information and other information regarding the customer's
business;
(c) Information regarding the vendors of CNL and the CNL Affiliates
which Executive acquired as a result of his employment with CNL,
including but not limited to, product and service information
and other information regarding the business activities of such
vendors;
(d) Training materials developed by and utilized by CNL and the CNL
Affiliates;
(e) Any other information which Executive acquired as a result of
his employment with CNL and which Executive has a reasonable
basis to believe CNL or the CNL Affiliates, as the case may be,
would not want disclosed to a business competitor or to the
general public; and
(f) Information which:
(i) is proprietary to, about or created by CNL or the CNL
Affiliates;
(ii)gives CNL or any of the CNL Affiliates some competitive
advantage, the opportunity of obtaining such advantage or
the disclosure of which could be detrimental to the
interests of CNL or the CNL Affiliates;
(iii) is not typically disclosed to non-executives by CNL or
otherwise is treated as confidential by CNL or the CNL
Affiliates; or
(iv)is designated as Confidential Information by CNL or from
all the relevant circumstances should reasonably be assumed
by Executive to be confidential to CNL or any CNL
Affiliates.
7.2 Covenant Not to Compete. While employed by CNL or any CNL
Affiliate and for a period of one (1) year thereafter, in consideration of the
obligations of CNL hereunder, including without limitation their disclosure of
Confidential Information to Executive, Executive shall not, directly or
indirectly, for compensation or otherwise, engage in or have any interest in any
sole proprietorship, partnership, corporation, company, association, business or
any other person or entity (whether as an employee, officer, corporation,
business or any creditor, consultant or otherwise) that, directly or indirectly,
competes with any of the business enterprises in which CNL or any CNL Affiliate
or any of its current or future subsidiaries, parent, partners, or affiliates
(collectively, the "CNL Group") are now or during Executive's employment become
engaged in including, but not limited to, all aspects of commercial real estate
development, leasing and financing (collectively, "CNL's Business") in any and
all states in which CNL or any other member of the CNL Group conducts such
business while Executive is employed by CNL or any CNL Affiliate; provided,
however, Executive may continue to hold securities of CNL or any CNL Affiliate
or acquire, solely as an investment, shares of capital stock or other equity
securities of any company which are traded on any national securities exchange
or are regularly quoted in the over-the-counter market, so long as Executive
does not control, acquire a controlling interest in, or become a member of a
group which exercises direct or indirect control of more than five percent (5%)
of any class of capital stock of such corporation. Notwithstanding the
foregoing, in the event that Executive's employment by CNL naturally terminates
on the Termination Date and CNL elects not to pay Executive the Optional
Severance Payment pursuant to Section 6.4 above, then the prohibitions contained
in this Section 7.2 shall terminate on the Termination Date.
7.3 Nonsolicitation of Clients. While employed by CNL or any CNL
Affiliate and for a period of one (1) year thereafter, in consideration of the
obligations of CNL hereunder, including without limitation their disclosure of
Confidential Information to Executive, Executive shall not, directly or
indirectly, for himself or as principal, agent, independent contractor,
consultant, director, officer, member, or employee of any other person, firm,
corporation, partnership, company, association, business or other entity,
solicit, attempt to contract with, or enter into a contractual or business
relationship of any kind pertaining to any aspect of CNL's Business, or any
other business conducted by CNL or any other member of the CNL Group with any
person or entity with which CNL or any other member of the CNL Group, had any
contractual or business relationship or engaged in negotiations toward a
contract or business relationship in the previous twenty-four (24) months.
7.4 Nonsolicitation of Employees. While employed by CNL or any CNL
Affiliate and for a period of one (1) year thereafter, in consideration of the
obligations of CNL hereunder, including without limitation their disclosure of
Confidential Information to Executive, Executive shall not directly or
indirectly, for himself or as principal, agent, independent contractor,
consultant, director, officer, member, or employee of any other person, firm,
corporation, partnership, company, association or other entity, either (a) hire,
attempt to employ, contact, solicit with respect to hiring or enter into any
contractual arrangement with any employee or former employee of CNL or any CNL
Affiliate, or (b) induce or otherwise advise or encourage any employee of CNL or
any CNL Affiliate to leave his or her employment unless, in each such case, such
employee or former employee has not been employed by CNL or an CNL Affiliate for
a period in excess of six (6) months prior to such hire, attempt to employ,
employment contract, solicitation, or inducement.
7.5 Nondisparagement. While employed by CNL or any CNL Affiliate and
after Executive's employment terminates, in consideration of the obligations of
CNL hereunder, including without limitation their disclosure of Confidential
Information to Executive, Executive shall not disparage, denigrate or comment
negatively upon, either orally or in writing, CNL, any other member of the CNL
Group, or any of their officers or directors, including, but not limited to,
Xxxxx X. Xxxxxx, Xx. and Xxxxxx X. Xxxxxx, (collectively, the "Benefited
Persons"), to or in the presence of any person or entity unless compelled to act
by a valid subpoena or other legal mandate; provided, however, if Executive
receives such a subpoena or other legal mandate he shall provide CNL with
written notice of same at least five (5) business days prior to the date on
which Executive is required to make the disclosure. Unless Executive is
terminated for Cause, CNL shall not disparage, denigrate or comment negatively
upon, either orally or in writing, the Executive to any prospective employer or
third party after Executive's employment terminates unless compelled to do so by
subpoena or other legal mandate; provided however, if CNL receives such a
subpoena or other legal mandate it shall provide Executive with written notice
of same at least five (5) business days prior to the date on which CNL is
required to make the disclosure.
7.6 Confidentiality. While employed by CNL or any CNL Affiliate and
after Executive's employment terminates, in consideration of the obligations of
CNL hereunder, including without limitation their disclosure of Confidential
Information to Executive, Executive shall keep secret and retain in strictest
confidence, and shall not use disclose to any third-party or for his benefit or
the benefit of others, except in connection with the business affairs of CNL or
any other Benefited Persons, all information relating to the business of CNL or
any of the other Benefited Persons, including, without limitation, information
concerning the financial condition, prospects, methods of doing business,
marketing and promotion of services, disclosed to or known by the Executive as a
consequence of his employment by CNL or any CNL Affiliate, which information is
not generally known or otherwise obtainable in the public domain, unless
compelled to do so by a valid subpoena or other legal mandate. In the event
Executive receives such a subpoena or other legal mandate, he shall provide CNL
with written notice of same at least five (5) business days prior to the date
Executive is required to make such disclosure.
8. Tangible Items. All files, records, documents, manuals, books,
forms, reports, memoranda, studies, data, calculations, recordings, or
correspondence, in whatever form they may exist, and all copies, abstracts and
summaries of the foregoing, and all physical items related to the business of
CNL or any other Benefited Person, whether of a public nature or not, and
whether prepared by Executive or not, are and shall remain the exclusive
property of CNL or any other Benefited Person, as the case may be, and shall not
be removed from their premises, except as required in the course of Executive's
employment by CNL, without the prior written consent of CNL. Such items,
including any copies or other reproductions thereof, shall be promptly returned
by Executive upon the termination of Executive's employment with CNL or any CNL
Affiliate, or at any earlier time upon the written request of CNL.
9. Remedies.
9.1 Injunctive Relief. CNL and Executive acknowledge and agree that
a breach by Executive of any of the covenants contained in Sections 7 or 8 of
this Agreement will cause immediate and irreparable harm and damage to CNL
and/or any other Benefited Person, and that monetary damages will be inadequate
to compensate CNL, and/or any other Benefited Person, as the case may be, for
such breach. Accordingly, Executive acknowledges that CNL and/or any other
Benefited Person affected shall, in addition to any other remedies available to
them at law or in equity, be entitled to an injunction from any court of
competent jurisdiction enjoining and restraining any violation of said covenants
by Executive or any of his affiliates, associates, partners or agents, either
directly or indirectly, without the necessity of proving the inadequacy of legal
remedies or irreparable harm. In addition, Executive acknowledges that in the
event of his breach of any of the provisions of Sections 7 or 8 of this
Agreement, in addition to any other remedies CNL may have, CNL may cease making
the balance of the payments specified in Section 6.1 or 6.4 and recover in full
from Executive any such payments previously made.
9.2 Arbitration. Except with regard to Section 7, all disputes
between the parties or any claims concerning the performance, breach,
construction or interpretation of this Agreement, or in any manner arising out
of this Agreement, shall be submitted to binding arbitration in accordance with
the Commercial Arbitration Rules, as amended from time to time, of the American
Arbitration Association (the "AAA"), which arbitration shall be carried out in
the manner set forth below:
(a) Within fifteen (15) days after written notice by one party to
the other party of its demand for arbitration, which demand
shall set forth the name and address of its designated
arbitrator, the other party shall appoint its designated
arbitrator and so notify the demanding party. Within fifteen
(15) days thereafter, the two arbitrators so appointed shall
appoint the third arbitrator. If the two appointed arbitrators
cannot agree on the third arbitrator, then the AAA shall appoint
an independent arbitrator as the third arbitrator. The dispute
shall be heard by the arbitrators within ninety (90) days after
appointment of the third arbitrator. The decision of any two or
all three of the arbitrators shall be binding upon the parties
without any right of appeal. The decision of the arbitrators
shall be final and binding upon CNL, its successors and assigns,
and upon Executive, his heirs, personal representatives, and
legal representatives.
(b) The arbitration proceedings shall take place in Orlando,
Florida, and the judgment and determination of such proceedings
shall be binding on all parties. Judgment upon any award
rendered by the arbitrators may be entered into any court having
competent jurisdiction without any right of appeal.
(c) Each party shall pay its or his own expenses of arbitration, and
the expenses of the arbitrators and the arbitration proceeding
shall be shared equally. However, if in the opinion of a
majority of the arbitrators, any claim or defense was
unreasonable, the arbitrators may assess, as part of their
award, all or any part of the arbitration expenses of the other
party (including reasonable attorneys' fees) and of the
arbitrators and the arbitration proceeding.
10. Severability. As the provisions of this Agreement are independent
of and severable from each other, CNL and Executive agree that if, in any action
before any court or agency legally empowered to enforce this Agreement, any
term, restriction, covenant, or promise is found to be unreasonable or otherwise
unenforceable, then such decision shall not effect the validity of the other
provisions of this Agreement, and such invalid term, restriction, covenant, or
promise shall be deemed modified to the extent necessary to make it enforceable.
11. Notice. For purposes of this Agreement, notices, demands and all
other communications provided for in the Agreement shall be in writing and shall
be deemed to have been duly given when received if delivered in person, the next
business day if delivered by overnight commercial courier (e.g. Federal
Express), or the third (3rd) business day if mailed by United States certified
mail, return receipt requested, postage prepaid, to the following addresses:
If to Executive:
Xxxxxx X. Xxxxxxx, Xx.
0000 X. Xxxxxxxx Xxx.
Xxxxxx Xxxx, XX 00000
If to CNL:
CNL Restaurant Investments, Inc.
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attn: Chief Executive Officer
Either party may change its address for notices in accordance with this
Section 11 by providing written notice of such change to the other party.
12. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida.
13. Benefits; Binding Effect; Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective heirs,
personal representatives, legal representatives, successors and permitted
assigns. Executive shall not assign this Agreement. However, CNL may assign this
Agreement to a CNL Affiliate upon written notice to Executive, provided that the
assignee assumes all of the obligations of CNL under this Agreement.
14. Entire Agreement. This Agreement, including its incorporated
Attachment "A", constitutes the entire agreement between the parties, and all
prior understandings, agreements or undertakings between the parties concerning
Executive's employment or the other subject matters of this Agreement are
superseded in their entirety by this Agreement. This Agreement may not be
modified or amended other than by an agreement in writing executed an delivered
by both parties hereto.
[SIGNATURE PAGE TO FOLLOW]
IN WITNESS WHEREOF, the undersigned have executed this Agreement to be
effective as of the date first above written.
"Executive"
/S/ XXXXXXXXX XXXXX /S/ XXXXXX X. XXXXXXX, XX.
---------------------------- --------------------------
Witness Xxxxxx X. Xxxxxxx, Xx.
"CNL"
CNL Restaurant Investments, Inc.
/S/ XXXXXXX X. XXXXXXXXXX By: /S/ XXXXXX X. XXXXXXXXXX
---------------------------- -----------------------------
Witness Xxxxxx X. XxXxxxxxxx
Chief Executive Officer
EMPLOYMENT AGREEMENT OF XXXXXX X. XXXXXXX, XX.
ATTACHMENT "A"
1. Base Salary. Executive's Base Salary shall be $155,000.00 per year.
2. Annual Bonus Compensation. Executive may receive annual bonus
compensation up to a maximum of forty percent (40%) of the Executive's current
Base Salary at the sole and absolute discretion of CNL's Chief Executive
Officer. Executive's bonus compensation shall be based, in part, on his
achieving his Key Performance Indicators (KPIs) for the year, CNL's performance
for the year, and determined in accordance with CNL executive compensation
policies.
