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EXHIBIT 10.22
EMPLOYMENT AGREEMENT
AGREEMENT made as of the 1st day of December, 1995, by and between
Xxxxxxx X. Xxxxx, residing at 00 Xxxxxxx, Xxxxxxx, Xxx Xxxx 00000 (hereinafter
referred to as the "Employee") and The Rattlesnake Holding Company, Inc., a
Delaware corporation with principal offices located at 0 Xxxxxxxx Xxxxxxx -
Xxxxx 000, Xxxxxxxx, Xxxxxxxxxxx 00000 (hereinafter referred to as the
"Company").
W I T N E S S E T H :
WHEREAS, the Company and its subsidiaries are engaged in
the business of developing and operating a chain of casual dining
restaurants; and
WHEREAS, the Company desires to employ the Employee and
secure for the Company the experience, ability and services of the
Employee; and
WHEREAS, the Employee desires employment with the Company, pursuant to
the terms and conditions herein set forth, superseding all prior agreements
between the Company, its subsidiaries and/or predecessors and Employee;
NOW, THEREFORE, it is mutually agreed by and between the parties
hereto as follows:
ARTICLE I
EMPLOYMENT
Subject to and upon the terms and conditions of this Agreement, the
Company hereby employs the Employee, and the Employee hereby accepts such
continued employment in his capacity as Vice-Chairman of the Board of Directors
and Chief Administrative
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Officer.
ARTICLE II
DUTIES
(A) The Employee shall, during the term of his employment with
the Company, and subject to the direction and control of the Company's Board of
Directors and Chief Executive Officer, perform such duties and functions as he
may be called upon to perform by the Company's Board of Directors and Chief
Executive Officer during the term of this Agreement.
(B) The Employee agrees to devote such business time as is
necessary to fully perform his duties and shall use his best efforts in the
performance of his duties for the Company and any subsidiary corporation of the
Company. The Company acknowledges that Employee is an executive officer of
another company and has outside business interests which will continue during
the term of this Agreement.
(C) The Employee shall perform, in conjunction with the
Company's Executive Management, to the best of his ability the following
services and duties for the Company and its subsidiary corporations (by way of
example, and not by way of limitation):
(i) Those duties attendant to the position with the
Company for which he is hired;
(ii) Implement the Company's general business plans and
strategy as formulated by the Board of Directors and the Chief Executive
Officer; and
(iii) Promotion of the relationships of the Company
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and its subsidiaries with their respective employees, customers, suppliers and
others in the business community.
(D) Employee shall be based in the New York/Connecticut area, and
shall undertake such occasional travel, within or without the United States as
is or may be reasonably necessary in the interests of the Company.
ARTICLE III
COMPENSATION
(A) Commencing the date hereof and during the term hereof, Employee
shall be compensated at the rate of $90,000 per annum (the "Base Salary"),
increasing 10% per annum, which shall be paid to Employee as in accordance with
the Company's regular payroll periods.
(B) Employee shall be entitled to receive a bonus (the "Bonus") during
each year of this Agreement, determined by the Board of Directors. Prior to the
expiration of six months after the commencement of this Agreement, the Board of
Directors and/or the Compensation Committee shall set forth a formula for
determining the Bonus for each year under this Agreement.
(C) Employee may receive such other additional compensation as may be
determined from time to time by the Board of Directors. Nothing herein shall be
deemed or construed to require the Board to award any bonus or additional
compensation.
(D) The Company shall deduct from Employee's compensation all federal,
state and local taxes which it may now or may hereafter be required to deduct.
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(E) The Company and Employee acknowledge that the position
contemplated hereunder is not a full time position. In the event the parties
desire Employee to be engaged full time in the business of the Company, the
compensation under this Article III shall be subject to renegotiation.
ARTICLE IV
BENEFITS
(A) During the term hereof, the Company shall (i) provide Employee
with group health care and insurance benefits as generally made available to the
Company's senior management; provided, however, that the Company will provide
term life insurance in the face amount of $500,000 (as long as Employee is
insurable without special exception or premium), at Employee's election, in lieu
of the group health care and insurance benefits in this subparagraph (A) (i);
(ii) reimburse the Employee, upon presentation of appropriate vouchers, for all
reasonable business expenses incurred by the Employee on behalf of the Company
upon presentation of suitable documentation, provided that reimbursement for any
expenses in excess of $500 per month shall be approved by the Chairman of the
Audit Committee; and (iii) pay to Employee the sum of $500 per month as and for
an automobile allowance.
(B) In the event the Company wishes to obtain Key Man life
insurance on the life of Employee, Employee agrees to cooperate with the Company
in completing any applications necessary to obtain such insurance and promptly
submit to such physical
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examinations and furnish such information as any proposed insurance
carrier may request.
(C) For each year of the term hereof, Employee shall be entitled
to three weeks paid vacation.
ARTICLE V
NON-DISCLOSURE
The Employee shall not, at any time during or after the termination of
his employment hereunder except when acting on behalf of and with the
authorization of the Company, make use of or disclose to any person,
corporation, or other entity, for any purpose whatsoever, any trade secret or
other confidential information concerning the Company's business, finances,
marketing, restaurant operations and future expansion and business plans of the
Company and its subsidiaries including information relating to any customer of
the Company or employee, or any other nonpublic business information of the
Company and/or its subsidiaries learned as a consequence of Employee's
employment with the Company (collectively referred to as the "Proprietary
Information"). For the purposes of this Agreement, trade secrets and
confidential information shall mean information disclosed to the Employee or
known by him as a consequence of his employment by the Company, whether or not
pursuant to this Agreement, and not generally known in the industry. The
Employee acknowledges that trade secrets and other items of confidential
information, as they may exist from time to time, are valuable and unique assets
of the
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Company, and that disclosure of any such information would cause substantial
injury to the Company.
ARTICLE VI
RESTRICTIVE COVENANT
(A) In the event of the voluntary termination of employment
with the Company prior to the expiration of the term hereof, or Employee's
discharge for gross misconduct as defined in Article IX, or the expiration of
the term hereof, Employee agrees that he will not, for a period of one year
following such termination (or expiration, as the case may be) directly or
indirectly enter into or become associated with or engage in any other
business (whether as a partner, officer, director, shareholder, employee,
consultant, or otherwise), which business is involved in the business of
developing, operating, franchising a chain of southwestern style casual
dining restaurants.
(B) In furtherance of the foregoing, Employee shall not during
the aforesaid period of non-competition, directly or indirectly, in connection
with any southwestern style casual dining restaurant chain, solicit any customer
or employee of the Company who was a customer or employee of the Company during
the tenure of his employment.
(C) If any court shall hold that the duration of
non-competition or any other restriction contained in this paragraph is
unenforceable, it is our intention that same shall not thereby be terminated but
shall be deemed amended to delete therefrom such
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provision or portion adjudicated to be invalid or unenforceable or in the
alternative such judicially substituted term may be substituted therefor.
ARTICLE VII
TERM
This Agreement shall be for a term commencing on the date
first set forth above and terminating December 31, 1998, unless sooner
terminated pursuant to the terms hereof.
ARTICLE VIII
DISABILITY DURING TERM
In the event Employee becomes totally disabled so that he is
unable or prevented from performing a material portion of his usual duties
hereunder for a period of four (4) months out of any six month period, and the
Company elects to terminate this agreement in accordance with Article IX,
paragraph (B) then, and in that event, Employee shall receive his Base Salary as
provided under Article III of this Agreement for a period of six (6) months
commencing from the date of such total disability but in no event to exceed the
expiration of the original term of this agreement. The obligation of the Company
to make the aforesaid payments shall be modified and reduced and the Company
shall receive a credit for all disability insurance payments which Employee may
receive from insurance policies provided by the Company.
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ARTICLE IX
TERMINATION
This Agreement may be terminated:
(A) By the Company, upon the death of Employee during the term hereof,
except that the Employee's legal representatives, successors, assigns and heirs
shall have those rights and interests as otherwise provided in this Agreement,
including the right to receive accrued but unpaid incentive compensation and any
special bonus compensation awarded by the Board of Directors in its discretion.
(B) Subject to the terms of Article VIII herein, by the Company, upon
written notice to the Employee, if Employee becomes totally disabled and as a
result of such total disability, has been prevented from and unable to perform a
material portion of his duties hereunder for a consecutive period of four (4)
months out of any six month period.
(C) By the Company, upon written notice from the Company to the
Employee, if the Employee has committed gross misconduct in the performance of
his duties and/or a material breach of the terms of this Agreement, and Employee
has failed to cure such breach within twenty (20) days from the date
notification setting forth such misconduct and/or breach in reasonable detail is
given to Employee by the Company.
(D) Upon thirty (30) days prior written notice by the Company or
Employee in the event Employee, due to professional commitments existing as of
the date hereof, preclude the Employee
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from devoting the necessary professional time to the business and
affairs of the Company.
(E) In the event of the termination of this Agreement and the
discharge of Employee by the Company in breach and violation of this Agreement,
Employee shall not be obligated to mitigate damages by seeking or obtaining
alternate employment.
ARTICLE X
STOCK OPTIONS
As an inducement to Employee to enter into this Agreement the
Company hereby grants to Employee, options to purchase shares of the Company's
Common Stock, $.001 par value, upon and subject to the following conditions:
(a) Subject to the terms and conditions of the Company's 1994
Employee Stock Option Plan (the "Plan"), a copy of which Employee acknowledges
having been received, and the terms and conditions set forth in the Stock Option
Certificate which are incorporated herein by reference, the Employee is hereby
granted options to purchase 120,000 shares of the Company's Common Stock of
which options to purchase 40,000 shares shall be vested on each anniversary
hereof. The option shall contain such other terms and conditions as set forth in
the stock option agreement. The exercise price of the options shall be $____.
The foregoing options are not qualified as incentive stock options.
The Options provided for herein are not transferable by
Employee and shall be exercised only by Employee, unless otherwise
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permitted by the Plan, or by his legal representative or executor,
as provided in the Plan. Such Option shall terminate as provided
in the Plan.
ARTICLE XI
EXTRAORDINARY TRANSACTIONS
The Company's Board of Directors has determined that it is
appropriate to reinforce and encourage the continued attention and dedication of
members of the Company's management, including the Employee, to their assigned
duties without distraction in potentially disturbing circumstances arising from
the possibility of a change in control of the Company. A "Change in Control" of
the Company shall be deemed to have occurred if there shall be consummated
(i)(x) any consolidation or merger of the Company in which the Company is not
the continuing or surviving corporation or pursuant to which shares of the
Company's Common Stock would be converted into cash, securities or other
property, other than a merger of the Company in which the holders of the
Company's Common Stock immediately prior to the merger have the same
proportionate ownership of common stock of the surviving corporation immediately
after the merger, or (y) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all, or substantially all,
of the assets of the Company, or (ii) the stockholders of the Company approved
any plan or proposal for the liquidation or dissolution of the Company, or (iii)
any person
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(as such term is used in Sections 13(d) and 13(d)(2) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act")), shall become the beneficial owner
(within the meaning of Rule l3d-3 under the Exchange Act) of 20% or more of the
Company's outstanding Common Stock, or (iv) during any period of two consecutive
years, individuals who at the beginning of such period constituted the entire
Board of Directors shall cease for any reason to constitute a majority thereof
unless the election, or the nomination for election by the Company's
stockholders, of each new director was approved by a vote of at least two-thirds
of the directors then still in office who were directors at the beginning of the
period.
The Company agrees that, if during the term hereof, or during such
time as the Employee is otherwise employed by the Company, a Change in Control
shall occur, all options to purchase Common Stock of the Company held by
Employee, either pursuant to this Agreement or otherwise, shall immediately vest
and become exercisable on the first day following a Change in Control. Further,
the options shall be deemed amended to provide that in the event of termination
after an event enumerated in this Article X, the options shall remain
exercisable for the duration of their term; and further, at the Employee's
option, an amount equal to three times the aggregate annual compensation paid to
the Employee during the calendar year preceding the Change in Control shall be
credited against the exercise price of any options held by Employee at the time
Employee elects to exercise such options; provided, however, that if the lump
sum severance payment under this Article XI, either alone or
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together with other payments which the Employee has the right to receive from
the Company, would constitute a "parachute payment" (as defined in Section 280G
of the Internal Revenue Code of l954, as amended (the "Code")), such credit
shall be reduced to the largest amount as will result in no portion of the
credit under this Article XI being subject to the excise tax imposed by Section
4999 of the Code.
ARTICLE XII
TERMINATION OF PRIOR AGREEMENTS
This Agreement sets forth the entire agreement between the
parties and supersedes all prior agreements between the parties, whether oral or
written, without prejudice to Employee's right to all accrued compensation prior
to the effective date of this Agreement.
ARTICLE XIII
ARBITRATION
Any dispute arising out of the interpretation, application
and/or performance of this Agreement with the sole exception of any claim,
breach or violation arising under Articles V or VI hereof shall be settled
through final and binding arbitration before a single arbitrator in the State of
Connecticut in accordance with the rules of the American Arbitration
Association. The arbitrator shall be selected by the Association and shall be an
attorney at law experienced in the field of corporate law. Any
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judgment upon any arbitration award may be entered in any court, federal or
state, having competent jurisdiction of the parties.
ARTICLE XIV
SEVERABILITY
If any provision of this Agreement shall be held invalid and
unenforceable, the remainder of this Agreement shall remain in full force and
effect. If any provision is held invalid or unenforceable with respect to
particular circumstances, it shall remain in full force and effect in all other
circumstances.
ARTICLE XV
NOTICE
All notices required to be given under the terms of this Agreement
shall be in writing and shall be deemed to have been duly given only if
delivered to the addressee in person, with written acknowledgment received, or
mailed by certified mail, return receipt requested, as follows:
IF TO THE COMPANY: The Rattlesnake Holding Company, Inc.
0 Xxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx
IF TO THE EMPLOYEE: Xx. Xxxxxxx X. Xxxxx
60 Foxwood
Jericho, NY 11753
or to any such other address as the party to receive the notice shall advise by
due notice given in accordance with this paragraph.
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Notice shall be effective three (3) days after delivery or mailing.
ARTICLE XVI
BENEFIT
This Agreement shall inure to, and shall be binding upon, the parties
hereto, the successors and assigns of the Company, and the heirs and personal
representatives of the Employee.
ARTICLE XVII
WAIVER
The waiver by either party of any breach or violation of any provision
of this Agreement shall not operate or be construed as a waiver of any
subsequent breach of construction and validity.
ARTICLE XVIII
GOVERNING LAW
This Agreement has been negotiated and executed in the State of
Connecticut, and Connecticut law shall govern its construction and validity.
ARTICLE XIX
JURISDICTION
Any or all actions or proceedings which may be brought by the Company
or Employee under this Agreement shall be brought in courts having a situs
within either the State of Connecticut, and Employee and the Company each hereby
consent to the jurisdiction of
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any local, state or federal court located within the State of
Connecticut.
ARTICLE XX
ENTIRE AGREEMENT
This Agreement contains the entire agreement between the parties
hereto. No change, addition or amendment shall be made hereto, except by written
agreement signed by the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
and affixed their hands and seals the day and year first above written.
(Corporate Seal) THE RATTLESNAKE HOLDING COMPANY, INC.
By: /s/Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx
Chairman of the Board
/s/XXXXXXX X. XXXXX
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XXXXXXX X. XXXXX (Employee)
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