AMENDED EMPLOYMENT AGREEMENT
THIS AMENDED EMPLOYMENT AGREEMENT ("Agreement") is made and entered
into as of the 24th day of October, 1996, by and between ROADHOUSE GRILL, INC.,
a Florida corporation (the "Company"), and XXXX XXXXX XXXXX, III ("Executive").
BACKGROUND
Executive is employed by the Company as its President pursuant to that
certain Employment Agreement dated as of October 1, 1994 ("Old Agreement"),
which the Company and Executive desire to amend and supersede as hereinafter
provided.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, the parties hereto hereby agree as
follows:
1. EMPLOYMENT. Effective as of the date hereof, the Old Agreement is
hereby amended and superseded in its entirety by this Agreement, and, as of such
date, upon the terms and conditions hereinafter set forth, the Company hereby
continues Executive's employment as its President and Executive hereby accepts
such employment.
2. TERM. The term ("Term") of Executive's employment hereunder
shall commence on the date hereof and shall end at 5:00 p.m. on October 23,
1999, or such earlier date upon which such employment is terminated in
accordance with the terms of this Agreement.
3. DUTIES AND SERVICES. Executive agrees to serve the Company as its
President for the duration of the Term faithfully and diligently under the
direction of the Board Directors of the Company, and to perform such duties as
are customarily associated with such position and such additional executive
duties as the Board of Directors of the Company shall reasonably request,
PROVIDED that such duties shall be consistent with those normally required of
presidents of comparable companies. Executive shall be required to devote his
best efforts, attention, knowledge and skill to the performance of his duties
hereunder. Executive shall at all times perform his duties hereunder in a
professional manner, in good faith, and in the best interest of the Company.
Executive shall devote substantially his full business time and efforts to the
performance of his duties hereunder. Executive shall be entitled to actively
pursue investment opportunities ("Investment Opportunities") during the Term, so
long as such activity does not materially interfere with the performance of
Executive's duties under this Section 3 and provided such pursuits do not
violate Section 8 hereof. If such Investment Opportunity materially interferes
with Executive's duties under this Section 3, Company may terminate Executive's
employment for Cause and pursuant to Section 5 hereof. No Investment Opportunity
shall be deemed to be a "business opportunity" of the Company and the Company
will have no legal or beneficial right, claim or interest in any Investment
Opportunity except as Executive may otherwise agree in writing, even if the
Investment Opportunity was conceived or developed during Executive's employment
with the Company, nor shall Executive have any fiduciary or other duty to
disclose or offer to Company any such Investment Opportunity.
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4. COMPENSATION. In exchange for the services to be rendered
hereunder by Executive, the Company hereby agrees to compensate Executive with
the following ("Compensation"):
A. SALARY. The Company agrees to pay Executive a
salary ("Salary") at the rate of Two Hundred Thousand Dollars ($200,000) per
annum, payable in accordance with the Company's usual payroll practices, but not
less often than bi-weekly.
B. BONUS. In addition to Salary, Executive shall be
entitled to receive "Bonuses" determined and payable in accordance with the
following:
(1) Executive shall be entitled to a Bonus in
the amount of One Hundred Thousand Dollars ($100,000), payable within ninety
(90) days after the Company's 1996 fiscal year, if Net Income (as hereinafter
defined) for such fiscal year exceeded the Net Income for the immediately
preceding fiscal year or if the net loss as reported by the Company for such
fiscal year is less than the net loss for the immediately preceding fiscal year.
Thereafter, Executive shall be entitled to a Bonus in the amount of One Hundred
Thousand Dollars ($100,000), payable within ninety (90) days after each
subsequent fiscal year of the Company ending during Executive's employment
hereunder, if the Company has Net Income and such Net Income for such fiscal
year exceeded the Net Income for the immediately preceding fiscal year.
(2) Executive shall also be entitled to a
Bonus, without reduction or discount, of One Hundred Thousand Dollars
($100,000), payable within ninety (90) days after the end of each fiscal year
begun but not concluded prior to the expiration or termination of Executive's
employment hereunder (regardless of the reason therefor), if Net Income for the
portion of the fiscal year during which the Executive was employed hereunder
("Employment Period") exceeds Net Income for the same period of the immediately
preceding fiscal year, unless, Executive's employment was terminated by the
Company pursuant to Section 5.A.(1) hereof or by Executive unilaterally other
than in accordance with Section 6 hereof during such fiscal year, or such
termination was a Wrongful Termination (in which event Bonus shall be paid as
set forth in Section 5).
(3) In the event that any fiscal year beginning
or ending during the Term hereof is less than three hundred sixty five (365)
days in duration ("Short Year").
(a) For purposes of determining whether
Net Income in the Short Year was exceeded by the Net Income in the subsequent
fiscal year, Net Income for such fiscal year shall be deemed to be the amount of
the Net Income for the twelve (12) month period ending on the last day of the
Short Year; and
(b) For purposes of determining whether
Net Income for the Short Year exceeded the preceding fiscal year, Net Income for
the Short Year shall be deemed to exceed the Net Income for the preceding year
if it exceeded Net Income for the same period of the preceding fiscal year,
unless Executive's employment hereunder terminated during the Short Year (in
which
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event Section 4.B.(2) shall apply), and if Net Income for the Short Year exceeds
the Net Income for the immediately preceding year (as so determined), Executive
shall be entitled to a Bonus of One Hundred Thousand Dollars ($100,000)
multiplied by the percentage of a full three hundred sixty five (365) day year
that the Short Year represents.
(4) For purposes of this Agreement, "Net
Income" for any period shall be net income before taxes determined in accordance
with Generally Accepted Accounting Principles based upon the Company's audited
financial statements for such period.
C. OTHER COMPENSATION AND BENEFITS.
(1) The Company shall provide Executive throughout the Term
with health insurance and dental insurance for Executive, his spouse and
children, and all other employee benefits made available to executives of the
Company including any pension, profit-sharing, bonus, or stock option plan,
life, health, medical, dental, hospitalization or surgical insurance plan or
policy, and any vacation or fringe benefit plans or programs, whether now
existing or hereafter established (collectively, "Executive Benefits").
(2) Nothing contained herein shall be deemed to be a waiver by
Executive of, or to diminish or modify, any vested rights which Executive may
have or may hereafter acquire under any employee benefit plan of the Company.
Without limiting the foregoing, Executive shall be entitled to stock options as
provided in the Stock Option Agreements attached as composite Exhibit A.
(3) It is contemplated that, in connection with his employment
hereunder, Executive will incur business, entertainment and travel expenses. The
Company agrees to reimburse Executive in full for all reasonable, ordinary and
necessary business, entertainment and other related expenses, including travel
expenses, incurred or expended by him incident to the performance of his duties
hereunder, and incurred or expended in accordance with the Company's policies
with respect to such expenses, upon submission by Executive to the Company of
such vouchers or expense statements satisfactorily evidencing such expenses as
may be reasonably required by the Company.
(4) Executive shall be entitled to at least four (4) weeks of
paid vacation (taken consecutively or in segments) each year during the Term.
Vacation time that is not used in a year will not be carried over to any
subsequent year.
5. TERMINATION OF EXECUTIVE'S EMPLOYMENT.
A. TERMINATION BY THE COMPANY. The Company shall have the
right to terminate Executive's employment under this Agreement prior to the
expiration of the Term only for Cause (as hereinafter defined) or upon
Executive's death or Permanent Disability.
(1) "Cause" for the Company to terminate
Executive's employment shall exist only if any of the following occur subsequent
to the date hereof.
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(a) Executive, other than as a result
of death or any mental or physical, temporary or permanent incapacity or
disability, shall have failed to perform his material duties hereunder;
PROVIDED, HOWEVER, that the Company shall first have notified Executive in
writing and in reasonable detail as to the manner in which Executive has so
failed to perform his duties hereunder, and Executive shall have failed to cure
such nonperformance within thirty (30) days thereafter or, if cure cannot
reasonably be completed within such period, Executive shall have failed to
commence cure during such period and to thereafter diligently pursue such cure
to completion;
(b) Executive shall have unlawfully
sexually harassed employees;
(c) Executive shall have been convicted
of any felony or found guilty of fraud; or
(d) Executive shall have engaged in
illegal drug use.
(2) Executive shall be deemed to have a
"Permanent Disability" if Executive is not able to perform his essential duties
hereunder, notwithstanding reasonable accommodation by Company, for a period of
three (3) consecutive months or in excess of one hundred eighty (180) days in
any one (1) year period, as a result of an illness or other physical or mental
disability.
(3) In the event the Company elects to
terminate Executive's employment pursuant to this Section 5, the Company shall
give written notice to such effect to Executive, which notice shall describe in
reasonable detail the basis for such termination, and Executive's employment
under this Agreement shall thereupon terminate as of the date said notice is
given.
(4) Any termination of Executive's employment
by the Company other than in strict accordance with this Section 5 shall be
deemed a material breach of this Agreement by the Company and a "Wrongful
Termination" of Executive's employment hereunder. The Company recognizes that,
in the event of a Wrongful Termination of Executive, Executive will be subject
to loss and damage, the monetary value of which will not be readily
ascertainable, and that there exists only a limited number of employment
opportunities comparable to the position held by Executive with the Company.
Therefore, in the event of a Wrongful Termination, Executive shall not be
required, either in mitigation of damages by the terms of this Agreement or
otherwise, to seek or accept other employment and the Company shall pay to
Executive, as liquidated damages and not as a penalty (in addition to the
compensation to which Executive is entitled through the date of such termination
and any benefits in which Executive has a vested right under the terms and
conditions of the plan or program pursuant to which such benefits were granted)
all of the following:
(a) continuation of Executive's Salary
until October 23, 1999, payable not less often than bi-weekly;
(b) continuation of all the Executive
Benefits until October 23, 1996; and
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(c) a Bonus of One Hundred Thousand
Dollars ($100,000) for the fiscal year in which termination occurred and Bonuses
of (i) One Hundred Thousand Dollars ($100,000) for each subsequent fiscal year
that ends prior to October 23, 1999, payable within ninety (90) days after the
end of such fiscal year and (ii) for the fiscal year (if any) that begins
subsequent to the date of the termination of Executive's employment hereunder
but ends after October 23, 1999, a Bonus in an amount equal to One Hundred
Thousand Dollars ($100,000) multiplied by the percentage of a full three hundred
sixty five (365) day year that the period between the commencement of such
fiscal year and the end of the Term represents, payable within ninety (90) days
after the end of such fiscal year.
If Executive terminates his employment hereunder for Cause as defined
in Section 6 hereof, such termination shall be deemed to constitute a Wrongful
Termination of Executive for purposes of this Section 5.
6. TERMINATION OF EXECUTIVE'S EMPLOYMENT BY EXECUTIVE. Executive may
terminate his employment hereunder for "Cause" (which, as it pertains to
termination by Executive, is defined below) or upon his death or Permanent
Disability. For purposes of this Agreement, "Cause" for Executive's termination
of his employment hereunder shall exist only if any of the following have
occurred:
A. the Company shall have failed to pay any amount due
Executive hereunder within ten (10) days of written notice thereof by Executive,
or failed to cure a breach of any of its material obligations under this
Agreement within thirty (30) days of written notice thereof by Executive; or
B. Executive is assigned duties inconsistent with his
position, or the Company withdraws any of his material responsibilities.
7. DEDUCTIONS AND WITHHOLDING. Executive agrees that the Company shall
have the right to withhold from any and all payments required to be made to
Executive pursuant to this Agreement all federal, state, local and/or other
taxes which are required to be withheld in accordance with applicable law.
Except for such withholding, the Company shall not have the right to offset any
amount from the Compensation or other amounts payable to Executive hereunder.
8. CONFIDENTIAL INFORMATION AND NONCOMPETITION COVENANT
A. CONFIDENTIAL INFORMATION. Executive hereby
acknowledges that in and as of a result of his employment hereunder, he will be
making use of, acquiring and/or adding to confidential information of a special
and unique nature and value relating to certain Company records, secrets,
documentation, ledgers and general Company information, account receivable and
payable ledgers, customer lists, prospective franchisees and franchisee lists,
financial and other records of the Company, its subsidiaries and affiliates,
franchisees and other similar matters (all such information, being hereinafter
referred to as "Confidential Information"), and the Executive further
acknowledges that the Confidential Information is of great value to the Company.
The parties recognize that the duties and services to be performed by the
Executive are special and unique and
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that, by reason of his employment hereunder, the Executive will acquire the
Confidential Information. Executive hereby agrees that he will not, at any time,
directly or indirectly, except in connection with Executive's employment
hereunder or as otherwise authorized by the Company's Board of Directors for the
benefit of the Company, divulge to any person, firm or corporation other than
the Company (hereinafter referred to as "Third Parties"), or use or cause to
authorize any Third Parties to use, the Confidential Information or any other
information relating to the business or interests of the Company which he knows
or should know is regarded as Confidential and valuable by the Company, except
as required by law or in any legal action arising from this Agreement, and
except for information that is or becomes publicly known other than through a
breach of this Agreement. Executive agrees that upon expiration of his
employment by the Company for any reason, he shall forthwith deliver or cause to
be delivered to the Company any and all Confidential Information, including
drawings, notebooks, keys, data and other documents and materials belonging to
the Company, which is in his possession or under his control relating to the
Company or its business, and will deliver upon such expiration of employment any
other property of the Company which is in this possession or under his control.
B. AGREEMENT NOT TO COMPETE. Executive hereby agrees, to the
extent permitted by law, that during Executive's employment hereunder and the
three (3) year period subsequent to the date of termination of his employment
with the Company hereunder, the Employee shall not either directly or
indirectly, as a proprietor, partner, investor, shareholder, employee, agent or
consultant:
(1) engage in the operation of any restaurant
(other than the Company's restaurants) that has both of the following
characteristics: (i) it usually derives or expects to derive over forty percent
(40%) of its gross revenues from the sale of steak; and also (ii) the average
dinner xxxx per person at the restaurant is less than Twenty Dollars ($20.00).
Nothing herein shall prevent the Executive from owning for investment purposes,
up to an aggregate of five percent (5%) of the capital stock of any such
business, provided that such business is a publicly held corporation, whose
stock is listed and traded on national or regional stock exchange, or through
the National Association of Securities Dealers Automated Quotation System
(NASDAQ), provided that Executive does not control any such company; or
(2) directly or indirectly solicit for
employment for or on behalf of himself or any Third Party any person who, within
one (1) year of the termination of Executive's employment hereunder, was an
employee of the Company.
9. INDEMNIFICATION: ADVANCEMENT OF FEES. To the full extent permitted
by applicable law, the Company shall indemnify Executive against all liability,
cost and expense (including, but not limited to, all reasonable attorney's and
other legal fees and costs through all negotiations and all trial and appellate
levels of litigation) that Executive may incur in connection with any proceeding
to which Executive is or may be made party (and all appeals thereof) by reason
of the fact that he is or was a director, officer, employee or agent of the
Company or is or was serving at the request of the Company as director, officer,
employee or agent of any other corporation, partnership, joint venture, trust or
other enterprise. The Company shall advance to Executive all fees and expenses
that Executive may incur in connection with any such proceeding to the full
extent permitted by applicable law, provided that Executive provides an
undertaking
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reasonably acceptable to the Company's Board of Directors to repay such
advancement if Executive is ultimately determined not to be entitled to
indemnification. The provisions of this Section 9 shall survive the termination
of this Agreement and Executive's employment hereunder.
10. ASSIGNABILITY AND BINDING EFFECT. The rights and obligations
arising under this Agreement shall inure to the benefit of and shall be binding
upon the heirs, executors, administrators, successors, and legal representatives
of Executive, and shall inure to the benefit of and be binding upon the Company
and its respective successors and assignees. The Company shall not assign its
rights or delegate its duties hereunder without the prior written consent of
Executive, other than to a company that has acquired all or substantially all
the assets of the Company, and assumes all the Company's obligations hereunder,
provided the assignment is made contemporaneously with such transaction and the
Company remains liable for all its obligations hereunder. Executive shall not
assign his rights or delegate his duties hereunder without the prior written
consent of the Company.
11. NOTICES. All notices, demands or other communications given
hereunder shall be in writing and shall be deemed to have been duly given only
upon hand delivery thereof or upon receipt, if sent by reputable overnight
courier, addressed as follows or, the fourth (4th) business day after mailing by
United States certified mail, return receipt requested, postage prepaid,
addressed as follows:
To Company: ROADHOUSE GRILL, INC.
0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
To Executive: XXXX XXXXX XXXXX, III
c/o Roadhouse Grill, Inc.
0000 Xxxxx Xxxxxxx, Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
or to such other addresses or such other person as any party shall designate, in
writing, to the other for such purposes and in the manner hereinabove set forth.
12. ENTIRE AGREEMENT. This Agreement supersedes and replaces any and
all prior agreements and understandings between the parties hereto respecting
the employment of Executive by the Company and constitutes the complete
understanding between the parties with respect to the employment of Executive
hereunder, and no statement, representation, warranty or covenant has been made
by any party with respect thereto except as expressly set forth herein.
13. AMENDMENT. The parties hereby irrevocably agree that no
attempted amendment, modification, termination, discharge or change
(collectively, "Amendment") of this Agreement shall be valid and effective,
unless the Company the Executive shall unanimously agree in writing to such
Amendment.
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14. NO WAIVER. No waiver of any provision of this Agreement shall be
effective unless it is in writing and signed by the party against whom it is
asserted, and any such written waiver shall only be applicable to the specific
instance to which it relates and shall not be deemed to be continuing or future
waiver.
15. HEADINGS. The headings set forth in this Agreement are for
convenience only and shall not be considered as part of this Agreement in any
respect nor shall they in any way affect the substance of any provisions
contained in this Agreement.
16. FURTHER ASSURANCES. The parties hereto will execute and
deliver such further instruments and do such further acts and things as may be
reasonably required to carry out the intent and purposes of this Agreement.
17. GOVERNING LAW. This Agreement shall be governed by, and construed
and enforced in accordance with, the laws of the State of Florida, and any
proceeding arising between the parties in any manner pertaining or related to
this Agreement shall, to the extent permitted by law, be held in Broward County,
Florida.
18. LITIGATION. If any party hereto is required to engage in
litigation against any other party hereto, either as plaintiff or as defendant,
in order to enforce or defend any of its or his rights under this Agreement, and
such litigation results in a final judgment in favor of such party ("Prevailing
Party"), then the party or parties against whom said final judgment is obtained
shall reimburse the Prevailing Party for all direct, indirect or incidental
expenses incurred by the Prevailing Party in so enforcing or defending its or
his rights hereunder, including, but not limited to, all reasonable attorneys'
and other legal fees and court costs and other expenses incurred throughout all
negotiations, trials or appeals undertaken in order to enforce the Prevailing
Party's rights hereunder.
19. SEVERABILITY. If any clause or provision hereof shall be held
invalid or unenforceable in whole or in part in any jurisdiction, then such
invalidity or unenforceability shall affect only such clause or provision, or
part thereof, in such jurisdiction, and shall not in any manner affect such
clause or provision in any other jurisdiction, or any other clause or provision
of this Agreement in any jurisdiction.
20. JOINT DRAFTING RESPONSIBILITY. This Agreement is the result of the
joint efforts and negotiations of the parties hereto, with each party being
represented or having the opportunity to be represented by legal counsel of its
own choice. The parties agree that the rule of judicial interpretation to the
effect that any ambiguity or uncertainty contained in an agreement is to be
construed against the party who drafted the Agreement shall not be applied in
the event of any disagreement or dispute arising out of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the day and year first above written.
Signed, Sealed and Delivered
in the Presence of: COMPANY:
ROADHOUSE GRILL, INC., a
Florida corporation
By: /s/ Tan Xxx Xxx
______________________________ Title: Director
______________________________
By: /s/ Xxxxxxxxx X. Xxxx
______________________________ Title: Director
______________________________
By: /s/ Xxxxxx Xxxxxxxx
______________________________ Title: Director
______________________________
EXECUTIVE:
______________________________ /s/ Xxxx Xxxxx Xxxxx, III
XXXX XXXXX XXXXX, III
______________________________
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EXHIBIT A
Stock Option Agreements
A-1
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT ("Agreement") is made and entered into as
of the 24th day of October, 1996 by and between ROADHOUSE GRILL, INC., a Florida
corporation (the "Company"), and XXXX XXXXX XXXXX, III ("Optionee").
W I T N E S S E T H:
WHEREAS, the Optionee is a key employee of the Company;
WHEREAS, subject to the terms and conditions set forth herein, the
Company desires to grant Optionee an option to acquire up to Four Hundred Fifty
Thousand (450,000) shares of the Company's common stock, par value $0.01 per
share ("Common Stock"); and
WHEREAS, the Company has filed a registration statement under the
Securities Act of 1933 pertaining to an initial public offering of the Common
Stock ("IPO") that contemplates that the Company will effect a 3-for-1 reverse
stock split prior to the IPO ("Reverse Split").
NOW, THEREFORE, in consideration of Ten Dollars ($10.00) in hand paid,
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties hereby agree as follows:
1. RECITALS. The forgoing recitals are true and correct and
are hereby incorporated by reference.
2. OPTION. The Company hereby grants Optionee an option ("Option") to
purchase Four Hundred Fifty Thousand (450,000) shares of Common Stock (the
"Option Stock") for Three Dollars and 60/100 ($3.60) per share ("Option Price"),
subject to adjustment for the Reverse Stock Split and for such other adjustments
as hereinafter provided. If the Reverse Stock Split precedes the IPO and both
occur by January 1, 1997, the number of shares of Option Stock shall be adjusted
as provided in Section 6 hereof but the "Option Price" shall be adjusted as of
the date of the consummation of the IPO to be the price to the public per share
in the IPO net of all underwriting discounts and selling concessions,
notwithstanding anything to the contrary in Section 6 hereof. Thereafter and in
all other cases, the Option Stock and Option Price shall be subject to
adjustment as provided elsewhere herein. Except as otherwise provided herein,
the Option shall become exercisable in accordance with Section 3 hereof and,
unless sooner terminated pursuant to this Agreement, shall remain exercisable
until 5:00 p.m. Eastern Time on October 23, 2004 ("Exercise Period").
3. VESTING AND EXERCISE OF OPTION.
A. VESTING. The Option may be exercised for: (i) One
Hundred Fifty Thousand (150,000) shares of the Option Stock beginning one (1)
year after the date hereof; (ii) an additional One Hundred Fifty Thousand
(150,000) shares of the Option Stock beginning two (2)
1
years after the date hereof; and (iii) an additional One Hundred Fifty Thousand
(150,000) shares of the Option Stock beginning three (3) years after the date
hereof. The Option shall be deemed "vested" as to all Common Stock for which it
is then exercisable.
B. EXERCISE. Optionee may exercise the Option from time to
time for any or all Option Stock for which it is then exercisable by delivering
written notice thereof ("Exercise Notice") to the Company at any time during the
Exercise Period, which Exercise Notice shall specify the number of shares of
Option Stock for which such exercise is made. The Option Notice shall be
accompanied by the Option Price and the amount of any withholding taxes the
Company is required to pay as a result of the exercise of the Option.
C. MANNER OF PAYMENT. The Option Price and the amount of any
such withholding required to be paid by Optionee may be paid at the election of
the Optionee: (i) in cash or by check; (ii) by directing the Company to withhold
shares of Option Stock purchased upon the exercise of such Option, the Fair
Market Value (as hereinafter defined) of which, as of the date of the Exercise
Notice, corresponds to such Option Price and tax withholding liability to be
paid for therewith; or (iii) any combination of (i) or (ii). For purposes of
this Agreement, "Fair Market Value" means, as to any security on a given day,
the average of the closing prices of such security's sales on all domestic
securities exchanges on which such security may at the time be listed, or, if
there have been no sales on any such exchange on such day, the average of the
highest bid and lowest asked prices on all such exchanges at the end of such
day, or, if on such day such security is not so listed, the average of the
representative bid and asked prices quoted in the NASDAQ System as of 4:00 P.M.,
New York time, on such day, or, if on any day such security is not quoted in the
NASDAQ System, the average of the highest bid and lowest asked prices on such
day in the domestic over-the-counter market as reported by the National
Quotation Bureau, Incorporated, or any similar successor organization, or, if
the security is not regularly traded in a public market, as determined by a
valuation prepared by an independent expert mutually agreeable to the Optionee
and the Company.
4. EFFECT OF CERTAIN EVENTS ON VESTING AND TERMINATION.
A. CHANGE OF CONTROL. In the event of a Change of Control (as
hereinafter defined), the Option shall immediately be fully vested and
exercisable for all Option Stock and shall thereafter be exercisable as to all
shares of Option Stock for which the Option has not yet been exercised. For
purposes of this Agreement, "Change of Control" shall mean if: (i) the Company
agrees to sell all or substantially all of its assets for cash or property or
for a combination of cash and property; (ii) the Company agrees to any merger,
consolidation, reorganization, division or other Corporate Transaction (as
hereinafter defined) in which the holders of the Company's Common Stock become
entitled to receive, with respect to their Common Stock, cash, securities or
assets other than, or in addition to, their Common Stock, or in which the
Company will not be the surviving entity; (iii) the approval by the shareholders
of the Company of any plan or proposal for the liquidation or dissolution of the
Company; or (iv) the acquisition by any person or group (as that term is defined
in the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the
rules promulgated pursuant to that act) in a single transaction or a series of
transactions of 30% or more in voting power of the outstanding
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stock of the Company and, within two years after the last of such transactions
took place, the individuals who constituted the Board of Directors of the
Company as of immediately prior to the first of such transactions cease for any
reason to constitute at least a majority of the Board of Directors.
B. TERMINATION FOR CAUSE. In the event of a termination of
Optionee's employment with the Company by the Company for "Cause," as defined in
Optionee's Employment Agreement with the Company dated as of October 24, 1996
("Employment Agreement"), or in the event Optionee's employment under the
Employment Agreement is terminated by Optionee without "Cause" (as defined
therein), then the Option may be exercised for the Option Stock for which the
Option is then exercisable until the expiration of the three (3) month period
immediately following the date of such termination of employment.
C. TERMINATION BECAUSE OF DEATH OR PERMANENT DISABILITY OF
OPTIONEE. In the event of a termination of Optionee's employment with the
Company because of his Permanent Disability (as defined in the Employment
Agreement) or death, then the Option shall immediately be fully vested and
exercisable as to all shares of Option Stock for which the Option has not been
exercised, and shall remain exercisable until the expiration of the twelve (12)
month period immediately following the date of such termination of employment.
D. OTHER TERMINATION OF EMPLOYMENT. Upon expiration of the
term of Optionee's employment under the Employment Agreement, termination by
Optionee of the Employment Agreement with Cause, termination by the Company
other than for Cause or because of Optionee's death or Permanent Disability,
termination by mutual consent of Company and Optionee, or any other termination
of Optionee's employment with the Company other than by the Company for Cause,
by Optionee without Cause, or as a result of Optionee's death or Permanent
Disability, the Option shall immediately be fully vested and exercisable as to
all Option Stock for which the Option has not been exercised, and shall remain
exercisable until 5:00 p.m.
Eastern time on October 23, 2004.
5. CORPORATE TRANSACTIONS. While this Option is outstanding (whether or
not then vested), the Company shall give Optionee thirty (30) days prior written
notice of each Corporate Transaction as a result of which the holders of the
Common Stock will become entitled to receive, with respect to their Common
Stock, cash, securities or assets other than, or in addition to, their Common
Stock. Optionee shall be entitled at any time prior to such Corporate
Transaction to exercise the Option for any or all Option Stock (which exercise
may be conditioned by Optionee upon the consummation of the Corporate
Transaction), which exercise (and the issuance of the Option Stock pursuant
thereto) shall be deemed to have occurred immediately before the record date for
determining the holders of the Common Stock entitled to receive such cash,
securities or assets because of such Corporate Transaction.
6. SUBDIVISION OR COMBINATION OF COMMON STOCK. If the Company at any
time subdivides (by any stock split, stock dividend, recapitalization or
otherwise) one or more classes of its outstanding shares of Common Stock into a
greater number of shares, the Option Price in effect immediately prior to such
subdivision will be proportionately reduced and the number of
3
shares of Option Stock obtainable upon exercise of the Option will be
proportionately increased. If the Company at any time combines (by reverse stock
split or otherwise) one or more classes of its outstanding shares of Common
Stock into a smaller number of shares, the Option Price in effect immediately
prior to such combination will be proportionately increased (except, if the
Reverse Split precedes the IPO and both occur by January 1, 1997, the Option
Price shall be as provided in Section 2 hereof) and the number of shares of
Common Stock obtainable upon exercise of the Option will be proportionately
decreased.
7. REGISTRATION OF OPTION STOCK. In the event that any registration
statement under the Securities Act or any applicable State Securities Law is
filed with respect to Company's securities issued or issuable to employees under
any Company Employee Stock Option Plan, the Options and Option Stock issued or
issuable hereunder shall also be included in such registration statement, as if
the Options granted hereunder where granted under such Stock Option Plan.
8. TRANSFERABILITY. The Option will not be assignable or transferable
other than by will or the laws of descent and distribution or pursuant to a
qualified domestic relations order as defined by the Code or Title I of the
Employee Retirement Income Security Act of 1974, as amended. In the event the
Option is transferred by will or the laws of descent, the Option may be
exercised only by an executor or administrator or by the person or persons who
shall have acquired the Option directly from the Optionee by bequest or
inheritance.
9. RESTRICTIONS ON RESALES. The Optionee acknowledges that the Option
and the Option Stock have not been requested under the Securities Act of 1933,
as amended ("Securities Act") or applicable state securities laws and may not be
resold except pursuant to registration under the Securities Act and such state
securities laws or an exemption therefrom.
10. RIGHTS OF THE OPTIONEE. The grant of this Option, execution of this
Agreement or exercise of any portion of this Option shall not confer upon the
Optionee any right to, or guaranty of, a position as an employee, consultant,
advisor or director of the Company or any of its subsidiaries.
11. MISCELLANEOUS.
A. NOTICES. All notices, demands or other
communications given hereunder shall be in writing and shall be deemed to have
been duly given only upon hand delivery thereof or upon the first business day
after mailing by United States registered or certified mail, return receipt
requested, postage prepaid, addressed as follows:
To Company: Roadhouse Grill, Inc.
0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
4
To Optionee: Xxxx Xxxxx Xxxxx, III
Roadhouse Grill, Inc.
0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
or to such other address or such other person as any party shall designate, in
writing, to the other for such purposes and in the manner hereinabove set forth.
B. AMENDMENT. The parties hereby irrevocably agree
that no attempted amendment, modification, termination, discharge or change
(collectively, "Amendment") of this Agreement shall be valid and effective,
unless the parties shall unanimously agree in writing to such Amendment.
C. NO WAIVER. No waiver of any provision of this
Agreement shall be effective unless it is in writing and signed by the party
against whom it is asserted, and any such written waiver shall only be
applicable to the specific instance to which it relates and shall not be deemed
to be a continuing or future waiver.
D. GOVERNING LAW. This Agreement shall be construed
in accordance with the laws of the State of Florida and any proceeding arising
between the parties in any manner pertaining or related to this Agreement shall,
to the extent permitted by law, be held in Broward County, Florida.
E. FURTHER ASSURANCES. The parties hereto will execute
and deliver such further instruments and do such further acts and things as may
be reasonably required to carry out the intent and purposes of this Agreement.
F. ENTIRE AGREEMENT. This Agreement sets forth all
the promises, covenants, agreements, conditions and understandings between the
parties hereto, and supersedes all prior and contemporaneous agreements,
understandings, inducements or conditions, expressed or implied, oral or
written, between the parties with respect to the matters contained herein.
G. PREVAILING PARTY. If any party hereto is required
to engage in litigation against any other party hereto, either as a plaintiff or
as defendant, in order to enforce or defend any rights under this Agreement and
such litigation results in a final judgment in favor of such party ("Prevailing
Party"), then the party or parties against whom said final judgment is obtained
shall reimburse the Prevailing Party for all direct, indirect or incidental
expenses incurred including, but not limited to all attorneys' fees, paralegals'
fees, court costs and other expenses incurred throughout all negotiations,
trials or appeals undertaken in order to enforce the Prevailing Party's rights
hereunder.
H. BINDING EFFECT; ASSIGNMENT. This Agreement shall
be binding upon the parties hereto, their beneficiaries, heirs and
administrators and inure to the benefit of Optionee and his assigns, and shall
be binding upon the Company, its successors and assigns.
5
I. JOINT DRAFTING RESPONSIBILITY. This Agreement is the result
of the joint efforts and negotiations of the parties hereto, with each party
being represented or having the opportunity to be represented by legal counsel
of its own choice. The parties agree that the rule of judicial interpretation to
the effect that any ambiguity or uncertainty contained in an agreement is to be
construed against the party who drafted the Agreement shall not be applied in
the event of any disagreement or dispute arising out of this Agreement.
J. INCENTIVE STOCK OPTION PLAN. In the event that the
Company adopts a Stock Option plan that permits the issuance of incentive stock
options within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended, Optionee shall be entitled to exchange the unexercised options
granted hereunder for incentive stock options granted under such plan which
shall be upon the same terms and conditions as are set forth herein, except for
such changes thereto as are necessary to qualify them as incentive stock options
or to permit their issuance under such plan.
6
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date and year set forth above.
Signed, Sealed and Delivered
in the Presence of: COMPANY:
ROADHOUSE GRILL, INC., a
Florida corporation
__________________________________ By:___________________________________
Its:__________________________________
__________________________________
__________________________________ By:___________________________________
Its:__________________________________
__________________________________
__________________________________ By:___________________________________
Its:__________________________________
__________________________________
OPTIONEE:
___________________________________ _______________________________________
XXXX XXXXX XXXXX, III
___________________________________
7
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT ("Agreement") is made and entered into as
of the 1st day of October, 1994 by and between ROADHOUSE GRILL, INC., a Florida
corporation (the "Company"), and XXXX XXXXX XXXXX, III ("Optionee").
W I T N E S S E T H:
WHEREAS, the Optionee is a key employee of the Company; and
WHEREAS, effective as of October 1, 1994, in connection with that
certain Stock Purchase Agreement dated as of September 26, 1994 by and among
Roadhouse Grill Inc. and Berjaya Group (Cayman), and subject to the terms and
conditions set forth herein, the Company granted Optionee an option to acquire
up to Five Hundred Thousand (500,000) shares of the Company's common stock, par
value $0.01 per share ("Common Stock").
NOW, THEREFORE, in consideration of Ten Dollars ($10.00) in hand paid,
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties hereby agree as follows:
1. RECITALS. The forgoing recitals are true and correct and are
hereby incorporated by reference.
2. OPTION. The Company hereby grants Optionee an option ("Option") to
purchase Five Hundred Thousand (500,000) shares of Common Stock (the "Option
Stock") for Two and 50/100 Dollars ($2.50) per share ("Option Price"), subject
to adjustment as hereinafter provided. Except as otherwise provided herein, the
Option shall become exercisable in accordance with Section 3 hereof and, unless
sooner terminated pursuant to this Agreement, shall remain exercisable until
5:00 p.m. Eastern Time on September 30, 2002 ("Exercise Period").
3. VESTING AND EXERCISE OF OPTION.
A. VESTING. The Option may be exercised for: (i) One Hundred
Sixty Six Thousand Six Hundred Sixty Seven (166,667) shares of the Option Stock
beginning on September 30,1995; (ii) an additional One Hundred Sixty Six
Thousand Six Hundred Sixty Seven (166,667) shares of the Option Stock beginning
on September 30, 1996, and (iii) an additional One Hundred Sixty Six Thousand
Six Hundred Sixty Six (166,666) shares of the Option Stock beginning on
September 30, 1997. The Option shall be deemed "vested" as to all Common Stock
for which it is then exercisable.
B. EXERCISE. Optionee may exercise the Option from
time to time for any or all Option Stock for which it is then exercisable by
delivering written notice thereof ("Exercise Notice") to the Company at any time
during the Exercise Period, which Exercise Notice shall specify the number of
shares of Option Stock for which such exercise is made. The Option Notice
1
shall be accompanied by the Option Price and the amount of any withholding taxes
the Company is required to pay as a result of the exercise of the Option.
C. MANNER OF PAYMENT. The Option Price and the amount of any
such withholding required to be paid by Optionee may be paid at the election of
the Optionee: (i) in cash or by check; (ii) by directing the Company to withhold
shares of Option Stock purchased upon the exercise of such Option, the Fair
Market Value (as hereinafter defined) of which, as of the date of the Exercise
Notice, corresponds to such Option Price and tax withholding liability to be
paid for therewith; or (iii) any combination of (i) or (ii). For purposes of
this Agreement, "Fair Market Value" means, as to any security on a given day,
the average of the closing prices of such security's sales on all domestic
securities exchanges on which such security may at the time be listed, or, if
there have been no sales on any such exchange on such day, the average of the
highest bid and lowest asked prices on all such exchanges at the end of such
day, or, if on such day such security is not so listed, the average of the
representative bid and asked prices quoted in the NASDAQ System as of 4:00 P.M.,
New York time, on such day, or, if on any day such security is not quoted in the
NASDAQ System, the average of the highest bid and lowest asked prices on such
day in the domestic over-the-counter market as reported by the National
Quotation Bureau, Incorporated, or any similar successor organization, or, if
the security is not regularly traded in a public market, as determined by a
valuation prepared by an independent expert mutually agreeable to the Optionee
and the Company.
4. EFFECT OF CERTAIN EVENTS ON VESTING AND TERMINATION.
A. CHANGE OF CONTROL. In the event of a Change of Control (as
hereinafter defined), the Option shall immediately be fully vested and
exercisable for all Option Stock and shall thereafter be exercisable as to all
shares of Option Stock for which the Option has not yet been exercised. For
purposes of this Agreement, "Change of Control" shall mean if: (i) the Company
agrees to sell all or substantially all of its assets for cash or property or
for a combination of cash and property; (ii) the Company agrees to any merger,
consolidation, reorganization, division or other Corporate Transaction (as
hereinafter defined) in which the holders of the Company's Common Stock become
entitled to receive, with respect to their Common Stock, cash, securities or
assets other than, or in addition to, their Common Stock, or in which the
Company will not be the surviving entity; (iii) the approval by the shareholders
of the Company of any plan or proposal for the liquidation or dissolution of the
Company; or (iv) the acquisition by any person or group (as that term is defined
in the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the
rules promulgated pursuant to that act) in a single transaction or a series of
transactions of 30% or more in voting power of the outstanding stock of the
Company and, within two years after the last of such transactions took place,
the individuals who constituted the Board of Directors of the Company as of
immediately prior to the first of such transactions cease for any reason to
constitute at least a majority of the Board of Directors.
B. TERMINATION FOR CAUSE. In the event of a
termination of Optionee's employment with the Company by the Company for
"Cause," as defined in Optionee's Employment Agreement with the Company dated as
of October 24. 1996 ("Employment
2
Agreement"), or in the event Optionee's employment under the Employment
Agreement is terminated by Optionee without "Cause" (as defined therein), then
the Option may be exercised for the Option Stock for which the Option is then
exercisable until the expiration of the three (3) month period immediately
following the date of such termination of employment.
C. TERMINATION BECAUSE OF DEATH OR TOTAL DISABILITY OF
OPTIONEE. In the event of a termination of Optionee's employment with the
Company because of his Permanent Disability (as defined in the Employment
Agreement) or death, then the Option shall immediately be fully vested and
exercisable as to all shares of Option Stock for which the Option has not been
exercised, and shall remain exercisable until the expiration of the twelve (12)
month period immediately following the date of such termination of employment.
D. OTHER TERMINATION OF EMPLOYMENT. Upon expiration of the
term of Optionee's employment under the Employment Agreement, termination by
Optionee of the Employment Agreement with Cause, termination by the Company
other than for Cause (or because of Optionee's death or Permanent Disability),
termination by mutual consent of Company and Optionee, or any other termination
of Optionee's employment with the Company other than by the Company for Cause,
by Optionee without Cause, or as a result of Optionee's death or Permanent
Disability, the Option shall immediately be fully vested and exercisable as to
all Option Stock for which the Option has not been exercised, and shall remain
exercisable until 5:00 p.m.
Eastern time on September 30, 2004.
5. CORPORATE TRANSACTIONS. While this Option is outstanding (whether or
not then vested), the Company shall give Optionee thirty (30) days prior written
notice of each Corporate Transaction as a result of which the holders of the
Common Stock will become entitled to receive, with respect to their Common
Stock, cash, securities or assets other than, or in addition to, their Common
Stock. Optionee shall be entitled at any time prior to such Corporate
Transaction to exercise the Option for any or all Option Stock (which exercise
may be conditioned by Optionee upon the consummation of the Corporate
Transaction), which exercise (and the issuance of the Option Stock pursuant
thereto) shall be deemed to have occurred immediately before the record date for
determining the holders of the Common Stock entitled to receive such cash,
securities or assets because of such Corporate Transaction.
6. SUBDIVISION OR COMBINATION OF COMMON STOCK. If the Company at any
time subdivides (by any stock split, stock dividend, recapitalization or
otherwise) one or more classes of its outstanding shares of Common Stock into a
greater number of shares, the Option Price in effect immediately prior to such
subdivision will be proportionately reduced and the number of shares of Option
Stock obtainable upon exercise of the Option will be proportionately increased.
If the Company at any time combines (by reverse stock split or otherwise) one or
more classes of its outstanding shares of Common Stock into a smaller number of
shares, the Option Price in effect immediately prior to such combination will be
proportionately increased and the number of shares of Common Stock obtainable
upon exercise of the Option will be proportionately decreased.
3
7. REGISTRATION OF OPTION STOCK. In the event that any registration
statement under the Securities Act or any applicable State Securities Law is
filed with respect to Company's securities issued or issuable to employees under
the Company's 1994 Employee Stock Option Plan, the Options and Option Stock
issued or issuable hereunder shall also be included in such registration
statement, as if the Options granted hereunder where granted under the 1994
Employee Stock Option Plan.
8. TRANSFERABILITY. The Option will not be assignable or transferable
other than by will or the laws of descent and distribution or pursuant to a
qualified domestic relations order as defined by the Code or Title I of the
Employee Retirement Income Security Act of 1974, as amended. In the event the
Option is transferred by will or the laws of descent, the Option may be
exercised only by an executor or administrator or by the person or persons who
shall have acquired the Option directly from the Optionee by bequest or
inheritance.
9. RESTRICTIONS ON RESALES. The Optionee acknowledges that the Option
and the Option Stock have not been requested under the Securities Act of 1933,
as amended ("Securities Act") or applicable state securities laws and may not be
resold except pursuant to registration under the Securities Act and such state
securities laws or an exemption therefrom.
10. RIGHTS OF THE OPTIONEE. The grant of this Option, execution of this
Agreement or exercise of any portion of this Option shall not confer upon the
Optionee any right to, or guaranty of, a position as an employee, consultant,
advisor or director of the Company or any of its subsidiaries.
11. MISCELLANEOUS.
A. NOTICES. All notices, demands or other
communications given hereunder shall be in writing and shall be deemed to have
been duly given only upon hand delivery thereof or upon the first business day
after mailing by United States registered or certified mail, return receipt
requested, postage prepaid, addressed as follows:
To Company: Roadhouse Grill, Inc.
0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
To Optionee: Xxxx Xxxxx Xxxxx, III
Roadhouse Grill, Inc.
0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
or to such other address or such other person as any party shall designate, in
writing, to the other for such purposes and in the manner hereinabove set forth.
B. AMENDMENT. The parties hereby irrevocably agree
that no attempted amendment, modification, termination, discharge or change
(collectively, "Amendment") of this
4
Agreement shall be valid and effective, unless the parties shall unanimously
agree in writing to such Amendment.
C. NO WAIVER. No waiver of any provision of this
Agreement shall be effective unless it is in writing and signed by the party
against whom it is asserted, and any such written waiver shall only be
applicable to the specific instance to which it relates and shall not be deemed
to be a continuing or future waiver.
D. GOVERNING LAW. This Agreement shall be construed
in accordance with the laws of the State of Florida and any proceeding arising
between the parties in any manner pertaining or related to this Agreement shall,
to the extent permitted by law, be held in Broward County, Florida.
E. FURTHER ASSURANCES. The parties hereto will execute
and deliver such further instruments and do such further acts and things as may
be reasonably required to carry out the intent and purposes of this Agreement.
F. ENTIRE AGREEMENT. This Agreement sets forth all
the promises, covenants, agreements, conditions and understandings between the
parties hereto, and supersedes all prior and contemporaneous agreements,
understandings, inducements or conditions, expressed or implied, oral or
written, between the parties with respect to the matters contained herein.
G. PREVAILING PARTY. If any party hereto is required
to engage in litigation against any other party hereto, either as a plaintiff or
as defendant, in order to enforce or defend any rights under this Agreement and
such litigation results in a final judgment in favor of such party ("Prevailing
Party"), then the party or parties against whom said final judgment is obtained
shall reimburse the Prevailing Party for all direct, indirect or incidental
expenses incurred including, but not limited to all attorneys' fees, paralegals'
fees, court costs and other expenses incurred throughout all negotiations,
trials or appeals undertaken in order to enforce the Prevailing Party's rights
hereunder.
H. BINDING EFFECT; ASSIGNMENT. This Agreement shall
be binding upon the parties hereto, their beneficiaries, heirs and
administrators and inure to the benefit of Optionee and his assigns, and shall
be binding upon the Company, its successors and assigns.
I. JOINT DRAFTING RESPONSIBILITY. This Agreement is the result
of the joint efforts and negotiations of the parties hereto, with each party
being represented or having the opportunity to be represented by legal counsel
of its own choice. The parties agree that the rule of judicial interpretation to
the effect that any ambiguity or uncertainty contained in an agreement is to be
construed against the party who drafted the Agreement shall not be applied in
the event of any disagreement or dispute arising out of this Agreement.
5
IN WITNESS WHEREOF, the parties have executed this Agreement as of
October 24, 1996.
Signed, Sealed and Delivered
in the Presence of: COMPANY:
ROADHOUSE GRILL, INC., a
Florida corporation
________________________________ By:___________________________________
Its:__________________________________
________________________________
________________________________ By:___________________________________
Its:__________________________________
________________________________
________________________________ By:___________________________________
Its:__________________________________
________________________________
OPTIONEE:
_________________________________ ________________________________________
XXXX XXXXX XXXXX, III
_________________________________
6
