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Exhibit 10.15
EMPLOYMENT AGREEMENT
This Agreement is made as of the 14th day of January, 1998,
between Xxxxx'x Roadhouse, Inc., a Tennessee corporation (the "Company"), and
Xxxxx X. XxXxxxxx, a resident of the State of Tennessee ("Employee").
W I T N E S S E T H:
WHEREAS, the Company, which maintains its principal executive
offices at 000 Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxxx 00000, owns and
operates casual dining restaurants under the name "Xxxxx'x Roadhouse;"
WHEREAS, the Company desires to employ Employee and Employee
desires to accept such employment by the Company subject to the terms and
conditions contained herein; and
WHEREAS, in serving as an employee of the Company, Employee
will participate in the use and development of confidential proprietary
information about the Company, its customers and suppliers, and the methods used
by the Company and its employees in competition with other companies, as to
which the Company desires to protect fully its rights;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements herein set forth, the parties hereto agree as
follows:
1. Employment. The Company hereby employs Employee and
Employee accepts such employment with the Company, subject to the terms and
conditions set forth herein. Employee shall be employed as Senior Vice President
of Finance and Chief Financial Officer of the Company, shall perform all duties
and services incident to such positions, and such other duties and services as
may be prescribed by the Bylaws of the Company or established by the Board of
Directors of the Company from time to time. The Company reserves the right to
modify and/or assign other and different offices, titles and duties to Employee
in the future as the Board of Directors may determine. During his employment
hereunder, Employee shall devote his best efforts and attention, on a full-time
basis, to the performance of the duties required of him as an employee of the
Company.
2. Compensation. As compensation for services rendered by
Employee hereunder, Employee shall receive:
(a) An annual salary of $115,000, or such higher
salary as shall be approved unanimously by the Compensation
Committee of the Board of Directors, which salary shall be
payable in arrears in equal biweekly installments, plus
insurance and other benefits equivalent to the benefits
provided other executives of the Company, which are set forth
in Appendix I hereto;
(b) Three (3) weeks of compensated vacation time, to
be taken at any time during each year of the term of this
Agreement;
(c) Bonus compensation to be determined in accordance
with the terms and conditions of the Company's Executive Bonus
Plan; and
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(d) Reimbursement for all reasonable expenses
incurred by Employee in the performance of his duties under
this Agreement, provided that Employee submits verification of
such expenses in accordance with the policies of the Company.
Prior to the end of each fiscal year of the Company, the
Compensation Committee or Board of Directors shall review Employee's salary and
benefits payable hereunder. Any increases in salary or changes in fringe
benefits determined by the Compensation Committee or the Board of Directors at
such annual review shall become effective the following month unless otherwise
determined by the Company.
3. Confidential Information and Trade Secrets.
3.1 Employee recognizes that Employee's position with the
Company requires considerable responsibility and trust, and, in reliance on
Employee's loyalty, the Company may entrust Employee with highly sensitive
confidential, restricted and proprietary information involving Trade Secrets and
Confidential Information.
3.2 For purposes of this Agreement, a "Trade Secret" is any
scientific or technical information, design, process, procedure, formula or
improvement that is valuable and not generally known to competitors of the
Company. "Confidential Information" is any data or information, other than Trade
Secrets, that is important, competitively sensitive, and not generally known by
the public, including, but not limited to, the Company's business plan, training
manuals, product development plans, pricing procedures, market strategies,
internal performance statistics, financial data, confidential personnel
information concerning employees of the Company, supplier data, operational or
administrative plans, policy manuals, and terms and conditions of contracts and
agreements. The terms "Trade Secret" and "Confidential Information" shall not
apply to information which is (i) made available to the general public without
restriction by the Company, (ii) obtained from a third party by Employee in the
ordinary course of Employee's employment by the Company, or (iii) required to be
disclosed by Employee pursuant to subpoena or other lawful process, provided
that Employee notifies the Company in a timely manner to allow the Company to
appear to protect its interests.
3.3 Except as required to perform Employee's duties hereunder,
Employee will not use or disclose any Trade Secrets or Confidential Information
of the Company during employment, at any time after termination of employment
and prior to such time as they cease to be Trade Secrets or Confidential
Information through no act of Employee in violation of this Agreement.
3.4 Upon the request of the Company and, in any event, upon
the termination of employment hereunder, Employee will surrender to the Company
all memoranda, notes, records, manuals or other documents pertaining to the
Company's business or Employee's employment (including all copies thereof).
Employee will also leave with the Company all materials involving any Trade
Secrets or Confidential Information of the Company. All such information and
materials, whether or not made or developed by Employee, shall be the sole and
exclusive property of the Company, and Employee hereby assigns to the Company
all of Employee's right, title and interest in and to any and all of such
information and materials.
4. Covenant Not to Compete.
4.1 Employee hereby covenants and agrees with the Company that
during the
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term hereof and for a period expiring 12 months after the termination
or expiration of this Agreement, Employee will not directly or indirectly (i)
operate, develop or own any interest (other than the ownership of less than 5%
of the equity securities of a publicly traded company other than the Company or
any entity controlling the Company) in any business which has significant
(viewed in relation to the business of the Company) activities relating to the
ownership, management or operation of, or consultation regarding a casual dining
restaurant of which steak sales constitute 35% or more of total restaurant sales
(a "Restaurant"); (ii) compete with the Company or its subsidiaries and
affiliates in the operation or development of any Restaurant within the 48
contiguous states of the United States of America; (iii) be employed by or
consult with any business which owns, manages or operates a Restaurant; (iv)
interfere with, solicit, disrupt or attempt to disrupt any past, present or
prospective relationship, contractual or otherwise, between the Company, or its
subsidiaries or affiliates, and any customer, client, supplier or employee of
the Company, or its subsidiaries or affiliates; or (v) solicit any present or
known prospective management employee (including all corporate officers and
managers, all area or divisional directors and all restaurant general managers)
of the Company, or its subsidiaries or affiliates, to leave their employment
with the Company or its subsidiaries or affiliates, or hire any management
employee who was employed by the Company within six months prior to the date of
such hiring to work in any capacity; provided, however, that this Section 4.1
shall not apply if Employee's employment hereunder is terminated without cause
prior to the expiration of the Agreement.
4.2 If a judicial determination is made that any of the
provisions of this Section 4 constitutes an unreasonable or otherwise
unenforceable restriction against Employee, the provisions of this Section 4
shall be rendered void only to the extent that such judicial determination finds
such provisions to be unreasonable or otherwise unenforceable. In this regard,
the parties hereto hereby agree that any judicial authority construing this
Agreement shall be empowered to sever any portion of the territory or prohibited
business activity from the coverage of this Section 4 and to apply the
provisions of this Section 4 to the remaining portion of the territory or the
remaining business activities not so severed by such judicial authority.
Moreover, notwithstanding the fact that any provisions of this Section 4 are
determined not to be specifically enforceable, the Company shall nevertheless be
entitled to recover monetary damages as a result of the breach of such provision
by Employee. The time period during which the prohibitions set forth in this
Section 4 shall apply shall be tolled and suspended as to Employee for a period
equal to the aggregate quantity of time during which Employee violates such
prohibitions in any respect.
5. Specific Enforcement. Employee specifically acknowledges
and agrees that the restrictions set forth in Sections 3 and 4 hereof are
reasonable and necessary to protect the legitimate interests of the Company and
that the Company would not have entered into this Agreement in the absence of
such restrictions. Employee further acknowledges and agrees that any violation
of the provisions of Sections 3 or 4 hereof will result in irreparable injury to
the Company, that the remedy at law for any violation or threatened violation of
such Sections will be inadequate and that in the event of any such breach, the
Company, in addition to any other remedies or damages available to it at law or
in equity, shall be entitled to temporary injunctive relief before trial from
any court of competent jurisdiction as a matter of course and to permanent
injunctive relief without the necessity of proving actual damages.
6. Term. This Agreement shall continue for an initial period
of two (2) years from the date hereof, unless sooner terminated by either party
in the manner set forth herein. The date upon which this Agreement and
Employee's employment hereunder shall terminate, whether pursuant to the terms
of this Section or pursuant to any other provision of this Agreement shall
hereafter be referred to as the "Termination Date."
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7. Termination Upon Cessation of Company's Operations or Death
of the Employee. In the event the Company ceases its operations (other than
pursuant to a Change in Control (as defined in Section 11.1)) or the Employee
dies during the term of this Agreement, this Agreement shall immediately
terminate and neither the Employee nor the Company shall have any further
obligations hereunder, except that the Company shall continue to be obligated
under Section 2(a) hereof for any compensation, unpaid salary, bonus,
unreimbursed expenses or payments pursuant to Section 10 hereof owed to Employee
or his estate that have accrued but not been paid as of the Termination Date.
8. Termination by Employee. Employee may at any time terminate
his employment by giving the Company 90 days prior written notice of his intent
to terminate the Agreement. At the Termination Date, the Company shall have no
further obligation to Employee and Employee shall have no further rights or
obligations hereunder, except as set forth in Sections 3 and 4 above, and except
for the Company's obligation under Section 2(a) hereof for compensation, unpaid
salary, bonus or unreimbursed expenses that have accrued but have not been paid
as of the Termination Date.
9. Termination for Cause. The Company shall have the right at
any time to terminate Employee's employment immediately for cause, which shall
include any of the following reasons:
(a) If Employee shall violate the provisions of
Sections 3 or 4 of this Agreement.
(b) If Employee shall be convicted of, or enter a
plea of guilty or nolo contendere to (i) any felony, or (ii)
any misdemeanor involving the Company or reflecting upon
Employee's honesty or truthfulness;
(c) If Employee shall commit an act of dishonesty,
willful mismanagement, fraud or embezzlement involving or
against the Company.
Employee's obligations under Sections 3 and 4 hereof shall survive the
termination of the Agreement pursuant to this Section 9. In the event Employee's
employment hereunder is terminated in accordance with this Section, the Company
shall have no further obligation to make any payments to Employee hereunder
except for compensation, unpaid salary, bonus or unreimbursed expenses that have
accrued but have not been paid as of the Termination Date.
10. Termination Without Cause. In the event that Company
breaches this Agreement or Employee is terminated without cause during the term
hereof (which shall not include a termination pursuant to Sections 7, 8, 9, 11
or 12), the Company shall (a) pay Employee all bonuses and unreimbursed expenses
owed to Employee that have accrued but have not been paid as of the Termination
Date; (b) continue to pay to Employee, as severance compensation, his salary set
forth in Section 2(a) hereof for 12 months if Employee is terminated pursuant to
this Section within the initial two (2) year term of this Agreement; (c)
continue to provide the insurance provided for in Section 2(a) hereof for 12
months; and (d) pay Employee an amount which equals the average monthly bonus
earned by Employee in the two years immediately preceding the Termination Date
(as if such bonus was earned and paid on a monthly basis) for the number of
months for which severance compensation will be paid pursuant to clause (b)
above; provided, that if Employee has not been employed by the Company for two
years, then the bonus amount payable hereunder shall be computed on a pro rata
basis for the number of months Employee was actually employed by the Company (as
if such bonus was earned and paid on a monthly basis). In addition,
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the Employee's unvested stock options shall become fully vested and immediately
exercisable for a period of 90 days from the Termination Date. If Employee is
terminated without cause, the provisions of Section 4 will be void and of no
effect.
11. Termination Upon a Change in Control.
11.1 For purposes of this Agreement, a "Change in Control"
shall mean (i) a tender offer or exchange offer has been made for shares of the
Company's equity securities, provided that the corporation, person or entity
making such offer purchases or otherwise acquires shares of the Company's equity
securities representing 50% or more of the outstanding shares of the Company's
equity securities pursuant to such offer, (ii) the shareholders of the Company
have approved a definitive agreement to merge or consolidate with or into
another corporation pursuant to which the Company will not survive or will
survive only as a subsidiary of another corporation, or to sell or otherwise
dispose of all or substantially all of its assets, (iii) the time that the
Company first determines that any person and all other persons who constitute a
group (within the meaning of Section 13(d)(3) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")), have acquired direct or indirect
beneficial ownership (within the meaning of Section 13(d)(3) under the Exchange
Act) of twenty percent (20%) or more of the Company's outstanding securities,
unless a majority of the Continuing Directors, as hereinafter defined, approves
the acquisition not later than ten (10) business days after the Company makes
that determination or (iv) the first day on which a majority of the members of
the Company's Board of Directors are not Continuing Directors.
11.2 For purposes of this Agreement, "Continuing Directors"
shall mean, as of any date of determination, any member of the Board of
Directors of the Company who (i) was a member of the Board of Directors on
October 1, 1997, (ii) has been a member of the Board of Directors for the two
years immediately preceding such date of determination or (iii) was nominated
for election or elected to the Board of Directors with the affirmative vote of a
majority of Continuing Directors who were members of the Board at the time of
such nomination or election.
11.3 In the event of a termination upon a Change in Control,
Employee shall immediately be paid all accrued salary, bonus compensation to the
extent earned, vested deferred compensation (other than plan benefits which will
be paid in accordance with the applicable plan), any benefits under any plans of
the Company in which Employee is a participant to the full extent of Employee's
rights under such plans (including accelerated vesting of any awards granted to
Employee under the Company's 1995 Incentive Stock Plan, as amended), accrued
vacation pay and any appropriate business expenses incurred by Employee in
connection with his duties hereunder, all to the Termination Date, and all
severance compensation provided in Section 11.4, but no other compensation or
reimbursement of any kind.
11.4 In addition, Employee shall be paid as severance
compensation his base salary in monthly installments (at the rate payable at the
time of such termination) for 12 months if Employee is terminated pursuant to
this Section within the initial two (2) year term of this Agreement. Employee is
under no obligation to mitigate the amount owed Employee pursuant to this
Section 11.4 by seeking other employment or otherwise. Notwithstanding anything
in this Section 11.4 to the contrary, Employee may in Employee's sole
discretion, by delivery of a notice to the Company within thirty (30) days
following a termination upon a Change in Control, elect to receive from the
Company a lump sum severance payment by bank cashier's check equal to the
present value of the flow of cash payments that would otherwise be paid to
Employee pursuant to this Section 11.4. Such present value shall be determined
as of the date of delivery of the notice of election by Employee and shall be
based on a discount rate equal to the interest rate on 90-day U.S.
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Treasury bills, as reported in the Wall Street Journal (or similar publication),
on the date of delivery of the election notice. If Employee elects to receive a
lump sum severance payment, the Company shall make such payment to Employee
within ten (10) days following the date on which Employee notifies the Company
of Employee's election. In addition to the severance payment payable under this
Section 11.4, Employee shall be paid an amount which equals the average monthly
bonus earned by Employee in the two years immediately preceding the Termination
Date (as if such bonus was earned and paid on a monthly basis) for the number of
months for which severance compensation will be paid pursuant to the first
sentence of this Section 11.4; provided, that if Employee has not been employed
by the Company for two years, then the bonus amount payable hereunder shall be
computed on a pro rata basis for the number of months Employee was actually
employed by the Company (as if such bonus was earned and paid on a monthly
basis). Employee shall also be entitled to an accelerated vesting of any awards
granted to Employee under the Company's 1995 Incentive Stock Plan, as amended.
Employee shall continue to accrue retirement benefits and shall continue to
enjoy any benefits under any plans of the Company in which Employee is a
participant to the full extent of Employee's rights under such plans, including
any perquisites provided under this Agreement, through the remaining term of
this Agreement; provided, however, that the benefits under any such plans of the
Company in which Employee is a participant, including any such perquisites,
shall cease upon re-employment by a new employer.
11.5 Notwithstanding anything else in this Agreement and
solely in the event of a termination upon a Change in Control, the amount of
severance compensation paid to Employee under this Section 11, but exclusive of
any payments to Employee in respect of any stock options then held by Employee
(or any compensation deemed to be received by Employee in connection with the
exercise of any stock options at any time), shall not include any amount the
Company is prohibited from deducting for federal income tax purposes by virtue
of Section 280G of the Internal Revenue Code or any successor provision.
12. Disability of Employee. If, on account of physical or
mental disability, Employee shall fail or be unable to perform his assigned
duties in any material respect for a period of 60 consecutive days, the Company
shall pay Employee his full salary as set forth in Section 2(a) hereof and shall
provide the insurance, bonus and other benefits of Section 2(a) for a period of
six months from the date such disability began or for such shorter period as
Employee is unable to perform his duties hereunder; provided, however, that
Employee's salary shall be reduced by any disability income paid to him pursuant
to any disability insurance policy maintained under this Agreement. In the event
Employee is unable to perform his duties hereunder after the expiration of the
six-month period, this Agreement shall automatically terminate. Employee shall
not be required to perform his obligations under Section 1 hereof during any
period of disability.
13. Assignment.
(a) The rights and benefits of Employee under this
Agreement, other than accrued and unpaid amounts due under
Section 2(a) hereof, are personal to him and shall not be
assignable. Discharge of Employee's undertakings in Sections 3
and 4 hereof shall be an obligation of Employee's executors,
administrators, or other legal representatives or heirs.
(b) This Agreement may not be assigned by the Company
except to an affiliate of the Company, provided, however, that
if the Company shall merge or effect a share exchange with or
into, or sell or otherwise transfer substantially all its
assets to, another corporation, the Company shall assign its
rights hereunder to that corporation and cause such
corporation to assume the Company's obligations under
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this Agreement.
14. Notices. Any notice or other communications under this
Agreement shall be in writing, signed by the party making the same, and shall be
delivered personally or sent by certified or registered mail, postage prepaid,
addressed as follows:
If to Employee: Xxxxx X. XxXxxxxx
0000 Xxxxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
With a copy to:
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If to the Company: Xxxxx'x Roadhouse, Inc.
000 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: Chairman of the Compensation
Committee of the Board of
Directors
With a copy to: X. Xxxxx Xxxx, Esq.
Xxxxxx Xxxxxxx Xxxxxx & Xxxxx,
A Professional Limited Liability Company
0000 Xxxxxxxxx Xxxx Xxxxxx
000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
or to such other address as may hereafter be designated by either party hereto.
All such notices shall be deemed given on the date personally delivered or
mailed.
15. Governing Law. This Agreement shall be interpreted and
enforced in accordance with the laws of the State of Tennessee.
16. Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid, but
if any one or more of the provisions contained in this Agreement shall be
invalid, illegal or unenforceable in any respect for any reason, the validity,
legality and enforceability for any such provisions in every other respect and
of the remaining provisions of this Agreement shall not be in any way impaired.
17. Modification. No waiver of modification of this Agreement
or of any covenant, condition, or limitation herein contained shall be valid
unless in writing and duly executed by the party to be charged therewith and no
evidence of any waiver or modification shall be offered or received in evidence
of any proceeding, arbitration or litigation between the parties hereunder,
unless such waiver or modification is in writing, duly executed as aforesaid and
the parties further agree that the provisions of this section may not be waived
except as herein set forth.
18. Entire Agreement. This Agreement contains the entire
agreement of the
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parties hereto with respect to the subject matter contained herein. There are no
restrictions, promises, covenants or undertakings, other than those expressly
set forth herein. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter. This
Agreement may not be changed except by a writing executed by the parties.
IN WITNESS WHEREOF, the undersigned have executed this
Employment Agreement on the day and year first above written.
XXXXX'X ROADHOUSE, INC.
By: /s/ Xxxxxx X. Xxxxx
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Title: Chairman of the Compensation
Committee of the Board of Directors
EMPLOYEE
/s/ Xxxxx X. XxXxxxxx
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Xxxxx X. XxXxxxxx
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