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Exhibit 10.5
SCHEDULE IDENTIFYING OMITTED DOCUMENTS
The only particulars in which the attached document differs from the omitted
documents are the date of the Agreement and name of Officer and his address as
set forth below
DATE NAME OF OFFICER
1/16/90 X. Xxxxxx Xxxxxxxxxx
1/26/95 Xxxxxxx X. Xxxxxxxxx
1/16/90 Xxxxx X. Xxxxxxxx
10/16/95 Xxxxx X. Xxxxx
1/16/90 Xxxxxxxx X. Xxxxxxxx
Agreements executed after 1994 omit those portions of Section 1.3 not relevant
to earlier years. Agreements executed after September 1995 show the address of
the Registrant as 0000 Xxxxxxx Xxxxxxxxx, Xxxx Xxxx Xxxxx, Xxxxxxx 00000
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EMPLOYMENT AGREEMENT
((Date))
COOKER RESTAURANT CORPORATION, an Ohio corporation, with its principal
place of business at 0000 Xxxxxx Xxxx, Xxxxxxxx, Xxxx 00000 (the "Company");
and ((Name)), who resides at ((Address)) (the "Executive") agree as follows:
P R E A M B L E:
1. The Executive is employed by the Company.
2. The Company believes that the Executive's skill and knowledge are
important to its continued success.
3. The Executive desires to be protected from arbitrary dismissal if
there is a change in the control of the Company.
4. The Company believes that the Executive's desire to be so protected is
legitimate and that such protection will be in the best interest of the Company
and its shareholders because such protection will allow the Company to retain
the Executive and will allow the Executive to give advice concerning any
prospective change in control without concern for his own interests and with
consideration for the best interests of the Company and its shareholders only.
T E R M S:
SECTION 1. Effectiveness of this Agreement.
1.1. Conditions Precedent. This Agreement shall not be effective
between the Company and the Executive unless and until a Change in Control of
the Company (as defined in Section 1.2 below) has occurred while the Executive
is an employee of the Company. Furthermore, this Agreement shall not be
effective between the Company and the Executive unless at the time such Change
in Control has occurred, the Company has met or exceeded the financial ratio
targets set forth in Section 1.3 below.
1.2. Definition. For the purpose of this Agreement, a Change in
Control of the Company has occurred when:
1.2.1. any person (defined for the purposes of this Section 1.2
to mean any person within the meaning of Section 13(d) of the Securities
Exchange Act of 1934 (the "Exchange Act")), other than the Company or an
employee benefit plan established by its Board of Directors, acquires, directly
or indirectly, the beneficial ownership (determined under Rule 13d-3 of the
regulations promulgated by the Securities and Exchange Commission under Section
13(d) of the Exchange Act) of securities issued by the Company having 20% or
more of the voting power of all of the voting securities issued by the Company
in the election of directors at the next meeting of the holders of voting
securities to be held for such purpose, and such person acquired such
beneficial ownership without the prior consent of the Board of Directors of the
Company; or
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1.2.2. a majority of the directors elected at any meeting of the
holders of voting securities of the Company are persons who were not nominated
for such election by the Board of Directors of the Company or a duly
constituted committee of the Board of Directors of the Company having authority
in such matters; or
1.2.3. the Company merges or consolidates with or transfers
substantially all of its assets to another person and the Board of Directors
does not adopt a resolution, before the Company enters into any agreement for
such merger, consolidation or transfer, determining that it is not a Change in
Control.
1.3. Financial Ratio Targets. The financial ratio targets referred
to in Section 1.1 above are as follows:
1.3.1. for a Change in Control in 1990, the Company had a return
on assets of 10% in 1989 and a growth in earnings per share in 1989 over 1988
of 15%;
1.3.2. for a Change in Control in 1991, if the Company had an
average annual return on assets in 1989 and 1990 of 10% and an average annual
growth in earnings per share for 1990 over 1989 and 1989 over 1988 of 15%; and
1.3.3. for a Change in Control in 1992 and thereafter, the
Company had an average annual return on assets of 10% in the previous three
fiscal years and an average annual growth in earnings per share of 15% over
such period of time.
1.3.4. For the purposes of this Section 1.3, return on assets
shall be determined by dividing the net earnings of the Company as shown on its
audited financial statement for such fiscal year by the sum of (i) its total
assets on the last day of the previous fiscal year and (ii) its total assets of
the last day of the fiscal year in question, divided by two. Earnings per
share shall be as shown on its audited financial statements for such fiscal
year.
1.4. Cancellation of Agreement before Effectiveness. Anything else
in this Agreement to the contrary notwithstanding, this Agreement may be
cancelled by the Board of Directors of the Company or a duly constituted
committee thereof having authority in such matters at any time before the
occurrence of a Change in Control and will be cancelled by the termination of
the Executive's employment by the Company at any time before the occurrence of
a Change in Control for any reason. If this Agreement is so cancelled before
the occurrence of a Change in Control, it shall not thereafter become effective
between the Company and the Executive.
SECTION 2. Employment.
2.1. Term. The term of employment of the Executive under this
Agreement (the "Term of Employment") shall begin upon the first occurrence of a
Change in Control after January 16, 1990 (a "Trigger Event"), and shall
continue until the last day of the fiscal quarter of the Company ending on or
following the fifth anniversary of the date of the occurrence of such Trigger
Event.
2.2. Hiring. The Company hereby agrees to employ Executive during
the Term of Employment and the Executive hereby accepts such employment with
the Company and agrees to perform his duties as an employee of the Company in
accordance with the terms of this Agreement.
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2.3. Duties. During the Term of Employment, the Executive shall have
such titles, authorities and responsibilities as he had immediately before the
Trigger Event and shall have such additional titles, authority and
responsibilities as may be prescribed from time to time by the Board of
Directors of the Company.
2.4. Extent of Service. During the Term of Employment, the Executive
shall devote substantially all of his business hours and attention, reasonable
vacation time and absences for sickness excepted, to the business of the
Company, as necessary to fulfill his duties as an employee of the Company. The
Executive shall perform his duties as an employee of the Company with fidelity
and to the best of his ability. The Executive's duties under this Section 2.4
shall not be construed to prevent him from acting as a director of other
corporations or from engaging in civic, charitable, religious or similar
activities.
2.5. Location. During the Term of Employment, the Executive shall
not be required to perform his duties as an employee of the Company at any
location other than the location at which he performed his duties as an
employee of the Company immediately before the Trigger Event. The Company
shall provide the Executive with an office and assistant and clerical employees
at such location that are comparable to the office and assistant and clerical
employees available to him immediately before the Trigger Event and that are
reasonably necessary for him to discharge his duties hereunder. The Company
shall not require the Executive to travel away from such location for longer
times or greater distances than were required by the Company immediately before
the Trigger Event nor are reasonably necessary for him to perform his duties
hereunder.
SECTION 3. Compensation. As consideration for the services rendered by
the Executive to the Company hereunder during the Term of Employment, the
Company shall pay Executive the types and amounts of compensation as follows:
3.1. Base Salary. The Company shall pay the Executive a base salary,
in monthly or more frequent installments, at not less than the rate that the
Executive was receiving immediately before the Trigger Event. Such base salary
shall be increased at or before the end of each fiscal year of the Company
during the Term of Employment to reflect any increases in the Consumer Price
Index (all urban consumers) since the Trigger Event. The Executive shall have
the opportunity to receive other increases in his base salary comparable to
those awarded to other executives of the Company and commensurate with his
title, authority, responsibility, tenure and performance. No such increase
shall affect any of the Executive's other rights under this Agreement.
3.2. Bonus. The Executive shall be eligible to participate on a
reasonable basis in bonus, stock option, restricted stock and other incentive
compensation plans which provide opportunities to receive compensation which
are the greater of the opportunities provided by the Company for executives
with comparable duties or the opportunities under any such plans in which he
was participating immediately before the Trigger Event.
3.3. Benefits. The Executive shall have the right to receive
vacation, sick pay, life, dental, medical, hospitalization and disability
benefits and other fringe benefits and perquisites that are at least as
valuable to him as those provided by the Company to the Executive immediately
before the Trigger Event or such benefits and perquisites as are provided to
other executives of the Company who have similar titles, authorities,
responsibilities or base salary to the Executive, if such benefits and
perquisites would be more valuable to him.
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3.4. Expenses. The Company shall reimburse the Executive for all
reasonable out-of-pocket expenses incurred by him in the performance of his
duties hereunder, including expenses for travel, entertainment and similar
items, promptly after the presentation by the Executive, from time to time, of
an itemized account of such expenses.
SECTION 4. Covenant Not to Compete. For so long as the Executive is
employed by the Company during the Term of Employment, the Executive shall not
engage, directly or indirectly, in the medium priced full service restaurant
business (other than as an investor owning less than 5% of the voting
securities of any corporation having more than 500 securityholders) within 50
miles of any such restaurant operated by the Company if such activity is
reasonably likely to cause material injury to the Company, unless such activity
was disclosed to the Board of Directors of the Company before the Trigger Event
and the Board of Directors did not disapprove of such activity.
SECTION 5. Confidential Information. Executive recognizes and
acknowledges that the customer lists, trade secrets and proprietary information
of the Company ("Confidential Information") are valuable business assets of the
Company. Executive shall not, during or after the Term of Employment, disclose
any such Confidential Information to any person other than directors, officers,
employees, counsel, accountants and agents of the Company and persons, such as
suppliers and contractors, to whom such disclosure is made in furtherance of
the interests of the Company, nor use any such Confidential Information for his
own benefit or the benefit of any person other than the Company if such
disclosure or use would cause a material injury to the business of the Company.
Upon termination of the Term of Employment or at any subsequent time upon
request, Executive will promptly return to the Company all records relating to
Confidential Information which are then in his possession. Confidential
Information shall not include any information known generally to the public or
any information of a type not otherwise considered confidential by persons
engaged in the same business or a business similar to that of the Company.
SECTION 6. Intellectual Property. Executive shall disclose to the Company
all methods, systems, designs, inventions, products, writings and other similar
items that are related to the business of the Company ("Intellectual Property")
invented, developed or created by the Executive with resources provided by the
Company and in the ordinary course of his duties hereunder during the Term of
Employment, and agrees that all such Intellectual Property shall be the
property of the Company. Executive xxxxxx agrees to assign to the Company all
of Executive's rights in any such Intellectual Property and agrees to cooperate
with the Company in the preparation and filing of such patent applications and
other documents as are reasonably necessary to protect the Company's rights in
such Intellectual Property.
SECTION 7. Termination.
7.1. Methods of Termination.
7.1.1. During the Term of Employment, the employment of the
Executive hereunder may only be terminated by:
(A) the death of the Executive;
(B) the voluntary retirement or resignation of the Executive,
which shall become effective upon the delivery of a notice thereof to the
Company or such later date as may be specified in such notice;
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(C) the determination of the Board of Directors of the
Company that the Executive is Permanently and Totally Disabled (as defined in
Section 7.2.1 below); or
(D) the determination of the Board of Directors of the
Company that the Executive has
(i) willfully failed to perform material obligations
under this Agreement;
(ii) committed acts of deliberate dishonesty involving
the business of the Company; or
(iii) been convicted of a felony involving the business
of the Company and all rights of appeal have been
exhausted or lapsed and such conviction has not
been reversed or vacated.
Such determination may only be made after (A) the Company notifies the
Executive of the events or actions that are alleged to constitute the basis for
making such determination, (B) the Executive fails to substantially cure his
failure or the injury to the business of the Company within thirty (30) days
after he receives such notice and (C) the Board of Directors thereafter
conducts a hearing on such allegations and failure at which the Executive may
present evidence and witnesses on his behalf, be represented by legal counsel
and confront his accusers and the witnesses against him. A court may fully
review any determination made by the Board of Directors under clauses (c) or
(d) of this Section 7.1.1.
7.1.2. The Executive is "Permanently and Totally Disabled" for
the purposes of this Agreement if he is unable to perform his duties hereunder
for a continuous period of six months due to a physical or mental condition
that, in the opinion of a licensed physician, will be of indefinite duration or
is without a reasonable probability of recovery. The Executive agrees to
submit to an examination by a licensed physician of his choice in order to
obtain such opinion upon notice by the Company, given after the Executive has
been absent from his place of employment for at least six months, that it
desires to determine whether or not Executive is Permanently and Totally
Disabled. Such examination shall be paid for in advance by the Company. Any
physical or mental condition of the Executive that impairs his performance of
his duties hereunder, other than being Permanently and Totally Disabled, shall
not be the basis for the termination of his employment and shall not affect the
Company's obligations hereunder, as the Company has assumed the risk of such
physical and mental conditions.
7.2. Severance Payment. If the employment of the Executive by the
Company is terminated by the Company before the end of the Term of Employment
and the Board of Directors of the Company has not made a determination as
provided in Section 7.1.1(c) or (d) above or if the Executive resigns before
the end of the Term of Employment, because he has determined in good faith that
his titles, authorities, responsibilities, salary, salary increase and bonus
opportunities, benefits or perquisites have been diminished or that an adverse
change in his working conditions has occurred or that the Company has breached
this Agreement:
7.2.1. the Company shall pay to the Executive an amount equal to
the maximum amount permitted to be paid under Section 280G of the Internal
Revenue Code of 1986, as now in effect ("Section 280G"), which would not result
in the making of an excess parachute payment, as defined in Section 280G;
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7.2.2. if such payment is not made on the date of such
termination or resignation, the amount payable under Section 7.2.1 above shall
bear interest at the rate used for discounting payments to present value under
Section 280G;
7.2.3. the Executive shall be released from any further
obligations to the Company under Sections 2.4, 4, 5 and 6 of this Agreement or
created by law; and
7.2.4. any payment made under this Section 7.2 shall be
accompanied by a statement signed by an executive officer of the Company
setting forth in reasonable detail the amount of such payment and how it was
calculated.
7.3. Effect of Termination. Upon the termination of the employment
of the Executive by the Company, whether or not at the end of the Term of
Employment, the Company shall pay to the Executive any amounts due to him under
Section 3 for services rendered to the Company before such termination, and
shall provide him with all benefits to which he or his beneficiaries are vested
under any employee benefit plans in which he participated. Neither the
termination of the Executive's employment by the Company nor the end of the
Term of Employment shall relieve the Company of its obligations under Sections
7, 8, 9 and 10 of this Agreement which shall continue to be effective in
accordance with their terms.
7.4. Damages. The amounts payable to the Executive under Section 7.2
above are severance pay only and shall not be deemed to be in lieu of any
damages payable by the Company to the Executive for wrongful discharge or
otherwise. The Executive shall make reasonable efforts to mitigate damages
payable to him by the Company for wrongful discharge, breach of this Agreement
or other similar causes by seeking other employment; provided, however, that he
shall not be required to accept employment of substantially different character
than the highest position held by him with the Company or in a different
location than the one established under Section 2.5 above. Any compensation or
benefits from such other employment shall not reduce the amount payable to the
Executive as severance pay under Section 7.2 above.
SECTION 8. Enforcement Costs. The Company is aware that upon the
occurrence of a Change in Control, the Board of Directors or a shareholder of
the Company may then cause or attempt to cause the Company to refuse to comply
with its obligations under this Agreement, or may cause or attempt to cause the
Company to institute, or may institute, litigation seeking to have this
Agreement declared unenforceable, or may take, or attempt to take, other action
to deny the Executive the benefits intended under this Agreement. In these
circumstances, the purpose of this Agreement could be frustrated. It is the
intent of the Company that the Executive not be required to incur the expenses
associated with the enforcement of his rights under this Agreement by
litigation or other legal action because the cost and expense thereof would
substantially detract from the benefits intended to be extended to the
Executive hereunder, nor be bound to negotiate any settlement of his rights
hereunder under threat of incurring such expenses. Accordingly, if following a
Change in Control, it should appear to the Executive that the Company has
failed to comply with any of its obligations under this Agreement or in the
event that the Company or any other person takes any action to declare this
Agreement void or unenforceable, or institutes any litigation or other legal
action designed to deny, diminish or to recover from the Executive the benefits
intended to be provided to the Executive hereunder, and that the Executive has
complied with all of his obligations under this Agreement, the Company
irrevocably authorizes the Executive from time to time to retain counsel of his
choice at the expense of the Company as provided in this Section 8, to
represent the Executive in connection with the initiation or defense of any
litigation or other legal action, whether by or against the Company or any
director, officer, shareholder or other person affiliated with the Company, in
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any jurisdiction. Notwithstanding any existing or prior attorney-client
relationship between the Company and such counsel, the Company irrevocably
consents to the Executive entering into an attorney-client relationship with
such counsel, and in that connection, the Company and the Executive agree that
a confidential relationship shall exist between the Executive and such counsel.
The reasonable fees and expenses of counsel selected from time to time by the
Executive as hereinabove provided shall be paid or reimbursed to the Executive
by the Company on a regular periodic basis upon presentation by the Executive
of a statement or statements prepared by such counsel in accordance with its
customary practices. The payment of such fees and expenses shall not be
contingent upon the success of such counsel.
SECTION 9. Indemnification. The Company shall indemnify the Executive if
he was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (including, without limitation, an action by or
in the right of the Company) 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 a director, trustee, officer, employee, partner,
joint venturer or agent of another corporation, partnership, joint venture,
trust or other enterprise, against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the Company, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. No
indemnification shall be made in respect of any derivative claim, issue or
matter as to which the Executive shall have been adjudged to be liable to the
Company unless, and only to the extent that, the court in which such action or
suit was brought shall determine upon application that, despite the
adjudication of liability, but in view of all the circumstances of the case,
the Executive is fairly and reasonably entitled to indemnify for such expenses.
Expenses (including attorneys' fees) incurred in defending any civil or
criminal action, suit or proceeding referred to in this Section shall be paid
by the Company in advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of the Executive to
repay such amount, unless it shall ultimately be determined that he is entitled
to be indemnified by the Company as authorized in the preceding sentences. The
indemnification provided by this Section shall not be deemed exclusive of any
other rights to which the Executive may be entitled under the common law, the
Ohio General Corporation Law or the Articles of Incorporation or Code of
Regulations of the Company or any agreement, vote of its shareholders or
directors, or otherwise, both or as to action in his official capacity or as to
action in another capacity while holding such office.
SECTION 10. General.
10.1. Payment Obligations. The Company's obligation during and
after the Term of Employment to pay the Executive the amounts and to make the
arrangements provided herein is absolute and unconditional and shall not be
affected by any circumstance, including, without limitation, any setoff,
counterclaim, recoupment, defense or other right which the Company may have
against him or anyone else. All amounts payable by the Company hereunder shall
be paid without notice or demand. Each payment made hereunder by the Company
shall be final and the Company will not seek to recover any part of such
payment from the Executive or anyone else, for any reason. The Company may
withhold from amounts to be paid to the Executive hereunder any federal, state
or local withholding or other taxes or charges which it is from time to time
required by law to withhold.
10.2. This Agreement. This Agreement sets forth the entire
understanding between the parties hereto with respect to the subject matter
hereof. There are no agreements, understandings or representations (oral or
written) between the parties hereto relating to the subject matter of this
Agreement
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other than those set forth herein. There are no oral conditions precedent to
the effectiveness of this Agreement.
10.3. Non-Waiver. Neither the failure of nor any delay by any party
to this Agreement to enforce any right hereunder or to demand compliance with
its terms is a waiver of any right hereunder. No action taken pursuant to this
Agreement on one or more occasions is a waiver of any right hereunder or
constitutes a course of dealing that modifies this Agreement.
10.4. Waivers; Amendments. No waiver of any right or remedy under
this Agreement and no amendment, change or modification of the terms hereof or
rescission or termination hereof shall be binding on any party hereto unless it
is in writing and is signed by the party to be charged. No such waiver of any
right or remedy under any term of this Agreement shall in any event be deemed
to apply to any subsequent default under the same or any other term contained
herein.
10.5. Severability. The terms of this Agreement are severable and
the invalidity of all or any part of any term of this Agreement shall not
render invalid the remainder of this Agreement or the remainder of such term.
If any term of this Agreement is so broad as to be unenforceable, such term
shall be interpreted to be only so broad as is enforceable.
10.6. Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the Company and its successors and assigns and
shall be binding upon and inure to the benefit of the Executive and his legal
representatives and heirs. If the Company transfers a majority or more of its
operating assets to one or more persons who do not assume the Company's
obligations under this Agreement by agreement or operation of law, such
transfer shall be deemed to be a material breach of this Agreement by the
Company. This Agreement shall not be terminated by the dissolution,
liquidation or winding up of the Company or by the cessation of its business.
10.7. Notices. Any notice or other communication required or
permitted to be given under this Agreement shall be in writing and deemed to be
properly given when delivered in person or three days after being sent by
certified or registered United States mail, return receipt requested, postage
prepaid, and addressed to the party to whom it is directed at the address first
set forth above. Either party may change his or its address for notices in the
manner set forth above.
10.8. Rules of Construction. In this Agreement, unless the context
otherwise requires, words in the singular number include the plural, and in the
plural include the singular; and words of the masculine gender include the
feminine and the neuter, and when the sense so indicates, words of the neuter
gender may refer to any gender. The names of the parties hereto, the date and
the preamble first above written are part of this Agreement. The captions and
section numbers appearing in this Agreement are inserted only as a matter of
convenience. They do not define, limit or describe the scope or intent of the
terms of this Agreement.
10.9. Choice of Law. The validity, terms, performance and
enforcement of this Agreement shall be governed by those laws of the State of
Ohio that are applicable to agreements which are negotiated, executed,
delivered and performed solely in the State of Ohio.
10.10. Counterparts. This Agreement may be executed in any number of
counterparts, all of which shall constitute one and the same instrument, and
either party hereto may execute this Agreement by signing one or more
counterparts.
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S I G N A T U R E S:
COOKER RESTAURANT CORPORATION
By:__________________________________
((Signature))
((Title))
THE EXECUTIVE
_____________________________________
((Executive))
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