Exhibit 10.1.4
EMPLOYMENT
AGREEMENT
THIS AGREEMENT is entered into
effective this 5th day of March, 2009, by and between Western
Sizzlin Corporation, a Delaware corporation (“WSC”),
Western Sizzlin Franchise Corporation a Delaware Corporation and
wholly-owned subsidiary of WSC (“WSFC”), Western
Sizzlin Stores, Inc., a Delaware corporation and wholly owned
subsidiary of WSC (“WSSI”), and Robert Moore
(“Employee”).
WHEREAS, WSFC and WSSI (collectively
the “Company”) are engaged in the restaurant and
restaurant franchising business (the “Business”),
and,
WHEREAS, the Company has offered
employment to Employee subject to the execution of this Agreement
and Employee accepted employment on such terms;
NOW, THEREFORE, in consideration of
the above premises and the mutual covenants contained in this
Agreement and other good and valuable consideration, the receipt
and sufficiency of all of which are hereby acknowledged, the
parties agree as follows:
ARTICLE I: EMPLOYMENT AND
DUTIES
1.1
Effective Date of
Employment . The
Company agrees to employ Employee and Employee agrees to be
employed by the Company, beginning as of July 15, 2008 (the
“Effective Date”), and continuing for the period of
time set forth in Article 2 of this Agreement, subject to the
terms and conditions of this Agreement.
1.2
Location of Employment
. Employee will perform his
services under this Agreement at the principal office of the
Company, located in Roanoke, Virginia.
1.3
Position, Duties, and
Obligations . The
Company and Employee agree that Employee shall serve as Chief
Executive Officer and President of WSFC and WSSI. Employee
shall report to and shall perform such duties and exercise such
powers pertaining to the business of the Company as may be
determined from time to time by the Chief Executive Officer of
WSC. Employee acknowledges receipt of the Company’s
policies and procedures in the form set forth as
“Exhibit A” hereto, and agrees to abide by
and be bound by said policies and procedures as if they were fully
set forth in this Agreement.
1.4
Other Interests
. Employee agrees that his
employment with the Company will be full-time and that he will
devote his best efforts and full professional attention to the
business of the Company. Except for his employment with the
Company, during the term of this Agreement, Employee shall not
enter into any employment, independent contractor relationship, or
consulting arrangement, with any other person or entity, or provide
services to any other person or entity, without the prior written
consent of the Company.
1.5
Duty of Loyalty
. Employee acknowledges and
agrees that at all times while Employee is employed under this
Agreement, Employee owes a fiduciary duty of loyalty, fidelity and
allegiance to act at all times in the best interests of the Company
and to do no act which would injure the business, interests, or
reputation of the Company or any of its subsidiaries or
affiliates. In keeping with these duties, Employee shall make
full disclosure to the Company of all business opportunities
pertaining to the Company’s business and shall not
appropriate for Employee’s own benefit business opportunities
concerning the subject matter of the fiduciary
relationship.
ARTICLE II: TERM, TERMINATION,
AND SEVERANCE
2.1
Initial Term
. Unless otherwise terminated in
accordance with this Agreement, Employee’s employment shall
commence on the Effective Date and shall continue until
December 31, 2009 (the “Initial Term”).
Thereafter, the Agreement shall automatically renew for subsequent
one year terms (Renewal Terms).
2.2
Termination
. Termination of the
Employee’s employment shall be governed solely by this
Agreement and shall not be governed by generally applicable
policies of the Company concerning disciplinary action or
termination of employment. Employee’s employment shall
be terminated only in one of the following ways:
A.
At any time by mutual written
agreement of both parties to this Agreement; or
B.
Notwithstanding anything in
Section 2.1 of this Agreement to the contrary, upon thirty
(30) days written notice from the Company to Employee , or upon
thirty (30) days written notice from Employee to Company;
or
C.
Automatically and immediately should
one of the following events occur:
1.
Death . Employee dies; or
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2.
Disability
. Employee becomes totally and
permanently disabled, meaning Employee’s inability for a
period of three (3) months, to perform his duties contemplated
by this Agreement, such that he does not constitute a Qualified
Individual with a Disability under the terms of the Americans with
Disabilities Act of 1990. Such total and permanent disability
shall be determined by the Company based on medical and other
evidence satisfactory to it; or
D.
For Cause . At any time by the Company, by written
notice to Employee, terminating this Agreement and discharging
Employee for Cause, as defined in this section of this
Agreement.
1.
Cause . Termination by the Company of Employee’s
employment for “Cause” means:
i.
Employee has materially breached
this Agreement. A material breach of this Agreement shall
include but shall not be limited to a habitual or repeated neglect
of Employee’s duties (illness, injury or incapacity of the
Employee shall not constitute “Cause”);
ii.
Employee has breached his duty of
loyalty to the Company;
iii.
Employee has committed an act of
gross negligence, in connection with the performance of his duties
that is injurious to the business of the Company;
iv.
Employee has committed an act of
gross misconduct relating to his employment or the Company’s
business, including, but not limited to, theft or embezzlement of
the Company’s property or money, or an act of fraud against
the Company;
v.
Employee is convicted of a felony,
or a crime involving moral turpitude.
In the event Employee’s
employment is terminated at any time by mutual written agreement of
both parties, voluntarily terminated by Employee upon thirty (30)
days notice, automatically and immediately terminated upon
Employee’s death or total and permanent disability, or
terminated for “Cause”, as defined in this Agreement,
then following termination, Employee shall not be entitled to
payment of further compensation (whether base salary, bonus
compensation, or severance) or benefits of any type (other than
Employee’s right to “vested” benefits under the
Company’s benefit plans or continuing insurance coverage
under the Company’s Health Benefit Plan pursuant to the
Consolidated Omnibus Budget Reconciliation Act (COBRA) at
Employee’s sole expense) under this Agreement. If
Employee terminates this Agreement upon
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thirty (30) days notice, the Company
shall have the right at its option, to require Employee to
immediately leave the Company’s premises; provided, that the
Company shall be obligated to pay Employee’s base salary
during the 30-day notice period.
In the event Employee’s
employment is terminated by the Company without
“Cause,” as defined in this Agreement, then Employee
shall be entitled to a Severance Benefit as set forth in
Section 2.3, below. Under no circumstances shall
Employee receive severance under this Agreement if Employee, after
termination from the Company, is employed as an executive in a
portfolio company of Western Sizzlin’ Corporation.
“Portfolio company” as used in this Agreement shall
refer to any corporation or other business entity in which Western
Sizzlin’ Corporation owns any interest.
2.3
Severance . In the event that the Company terminates
Employee’s employment at any time, upon thirty (30)
days’ written notice, without Cause, then Employee’s
sole remedy shall be payment of the following Severance
Benefit:
A.
If termination without Cause occurs
during the Initial Term Employee shall be entitled to a severance
payment in an amount equal to three (3) months’ base
salary at the rate then in effect. If termination without
Cause occurs during the first Renewal Term Employee shall be
entitled to a severance payment in an amount equal to six
(6) months’ base salary at the rate then in effect. If
termination without Cause occurs during the second Renewal Term
Employee shall be entitled to a severance payment in an amount
equal to nine (9) months’ base salary at the rate then
in effect. If termination without Cause occurs during the third or
any subsequent Renewal Term Employee shall be entitled to a
severance payment in an amount equal to twelve (12) months’
base salary at the rate then in effect. If the Company terminates
this Agreement without Cause, the Company shall have the right at
its option, to require Employee to immediately leave the
Company’s premises; provided, that the Company shall be
obligated to pay (as additional severance) Employee’s base
salary during the 30-day notice period.
B.
Employee shall not be entitled to,
and shall not receive any cash bonus paid for any year in which the
termination occurs, on or pro rata basis or otherwise. The
base salary portion of the severance shall be payable, at the
Company’s option, in a lump sum or in equal monthly
installments consistent with the Company’s ordinary payroll
practices.
C.
In the event Employee elects
continuing insurance coverage under the Company’s Health
Benefit Plan pursuant to the Consolidated Omnibus Budget
Reconciliation Act (COBRA) following any termination without Cause,
then, in addition to payment of salary as set forth above,
the
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Company shall reimburse Employee for
all premiums paid by Employee for said continuation coverage for a
period of three-months.
ARTICLE III:
COMPENSATION
3.1
Base Salary
. During the Initial Term of
this Agreement, Employee’s gross base salary shall be Two
Hundred Fifty Thousand Dollars ($ 250,000.00) per year, paid in
equal installments in accordance with the Company’s standard
payroll practices. Employee’s base salary may be
reviewed and increased at the commencement of any Renewal Term, or
from time to time by the Chief Executive Officer of WSC in his sole
discretion and, after any such review and change, Employee’s
new level of base salary shall be Employee’s base salary for
purposes of this Agreement until the effective date of any
subsequent change.
3.2
Bonus Compensation
. While Employee is actively
employed under this Agreement, and in addition to Employee’s
Base Salary as set forth above, Employee is eligible to receive an
annual performance-based bonus. Such bonus shall be equal to
twenty percent (20%) of Cash Flows in excess of $ 2.3 million
annually as adjusted by a charge of 20% of any incremental
reinvestment of capital during each year (“Bonus
Compensation”). The charge for reinvestment of capital
shall be applied annually year over year but pro rated based upon
the month in which the invested capital is contributed by the
Company. For purposes hereof, “Cash Flows” shall
mean the Company’s earnings before interest, taxes,
depreciation and amortization (“EBITDA”), less capital
expenditures and excluding any payments to or obligations to make
severance payments to James C. Verney. The Bonus Compensation
shall be due and payable to Employee within thirty (30) days after
it is determined by the Company. The following example
illustrates the computation of Bonus Compensation:
Assumptions:
·
2008 Cash Flow of $2.5
million
·
Reinvestment of capital on
June 30, 2008 of $1 million
·
20% charge for reinvested capital of
$200,000/6 months is $100,000
Bonus Calculation:
·
Increase in Cash Flow of
$200,000
·
20% charge for reinvested capital of
$100,000
·
Adjusted Cash Flow is
$100,000
·
Multiplied by 20% results in Bonus
Compensation of $20,000
3.3
General Employee
Benefits . While
employed by the Company, Employee shall be allowed to participate,
on the same basis generally as other
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