Exhibit 10
SHAREHOLDER AGREEMENT
OF
COUSIN VINNIE'S FRANCHISE CORPORATION
DBA COUSIN
VINNIE'S ITALIAN DINER
THIS SHAREHOLDER
AGREEMENT (this
"Agreement") is made
and entered into as
of April ___, 2004, by and between BRIAN
RUGGIERO, an Individual ("RUGGIERO")
with address being 3309 Drinkwater Blvd,
Suite 303, Scottsdale,
Arizona 8585251
and BGR CORPORATION, a Nevada corporation ("BGR") with address being 5080
N.
40th Street, Suite 103, Phoenix, Arizona
85018.
ARTICLE I
FORMATION, NAME, PURPOSES, DEFINITIONS
1.1 FORMATION. Pursuant to the Nevada
Corporation
Act (the "Act"),
the
parties have formed a Nevada corporation effective upon the filing of the
Articles of Corporation of this Company
with the Nevada Corporation Commission.
The parties shall immediately, and from time to time hereafter, as may be
required by law, execute all amendments of the
Articles of Corporation, and do
all filing, recording and other acts as may be
appropriate
to operate the
Company in compliance with the Act.
1.2 INTENT.
It is the intent of
the Initial
Shareholders that the Company
shall always be operated in a manner
consistent
with its treatment as a "C"
Corporation for federal and state income tax
purposes. No Initial
Shareholder
shall take any action inconsistent with the
express intent of the parties.
1.3 NAME. The
name of this Company shall be:
COUSIN VINNIE'S FRANCHISE CORPORATION (COUSIN VINNIE'S)
1.4 PLACE OF
BUSINESS. The principal place of business of the Company shall
be at 5080 N. 40th Street, Suite 103, Phoenix, Arizona 85018, or such other
place as the majority consent of all the
Board of Directors shall determine.
1.5 PURPOSE.
(a) The purpose
of this Company shall be to operate a restaurant
franchise
company, and in connection therewith to transact any and all
lawful
business for which a
"C" Corporation may be
organized under Nevada
law.
Subject to the terms
hereof, the Company
shall have the authority to
do any act or
thing necessary or
appropriate
to accomplish the
foregoing
purpose.
(b) Except as
otherwise provided in this Agreement, without the
majority
consent of all the Board of Directors, the Company shall not
engage in any
other activity or business, and no Initial Shareholder acting
in its
capacity as an Initial Shareholder shall have any authority to
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obligate the
Company or any other
Initial Shareholder,
or to hold itself
out as a Initial Shareholder of the Company, with respect to any
transaction or
activity whatsoever other than those entered into or carried
out within the
scope and business
purpose of the
Company as
provided in
Section 1.5(a)
above.
1.6 TERM.
This Company
shall commence upon the filing of its
Articles of
Corporation and shall continue until such time
as it shall be terminated under
the provisions of Article XI hereof.
1.7 INITIAL SHAREHOLDERS. The name and address of each of the Initial
Shareholders of this Company are set forth
on Schedule 1 hereto.
1.8 AGENT FOR
SERVICE OF
PROCESS. The name and business address of the
agent for service of process for the
Company is James Rossie, with address being
301 East Virginia Avenue, Suite 3330, Phoenix, Arizona 85004 or such other
person or address, as the Company shall
appoint from time to time.
1.9 DEFINITIONS.
Whenever used in this Agreement, the following terms shall
have the following meanings:
(a) "ACT" shall mean the Nevada Corporation Act, as amended.
(b) "ADDITIONAL
CAPITAL CONTRIBUTIONS" shall mean any Capital
Contribution to
the Company pursuant to Article II below.
(c) "ADDITIONAL INITIAL SHAREHOLDER" shall mean any person who is
admitted to the
Company as an Additional Initial Shareholder pursuant to
this Operating
Agreement.
(d) "AFFILIATE"
means, with respect to any Person,
(i) any Person
directly or
indirectly controlling, controlled by, or under common
control
with such
Person, (ii) any
Person owning or controlling ten percent (10%)
or more of the
outstanding
voting interest of such Person, (iii) any
officer, director, or general partner of such Person,
or (iv) any Person
who is an
officer, director,
general partner,
trustee, or holder of ten
percent
(10%) or more of the
voting interest of any
Person described
in
clauses (i)
through (ii) of this sentence. For purposes of this definition,
the term
"controls," "is
controlled by," or "is under common control with"
shall mean the
possession, direct or of indirect, of the power to direct or
cause the
direction of the
management and
policies of a person or entity,
whether
through the ownership of voting securities, by contract or
otherwise.
(e) "AGREEMENT"
shall mean this
written Shareholder
Agreement.
No
other document
or oral agreement
among the Initial
Shareholders shall
be
treated as part
of or superseding this
Agreement unless it is reduced to
writing and it
has been signed by all of the Initial Shareholders.
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(g) "CAPITAL
CONTRIBUTION" shall mean any contribution to the capital
of the Company
in cash, property
or services by an Initial
Shareholder,
whenever
made.
(h) "CODE" shall mean
the Internal Revenue
Code of 1986, as
amended
from time to
time.
(i) "COMPANY" shall refer to COUSIN VINNIE'S FRANCHISE
CORPORATION.
(j) "CONTRIBUTING
INITIAL
SHAREHOLDER"
shall mean any Initial
Shareholder
who desires to pay an amount due to cure a default of a
Defaulting
Initial Shareholder.
(k) "DEFAULTING
INITIAL
SHAREHOLDER"
shall
mean any Initial
Shareholder
who has caused a
Monetary Default or a
Non-Monetary
Default,
which remains
uncured under this Agreement. All other Initial Shareholders
are
Non-Defaulting Initial Shareholders.
(l) "DISTRIBUTABLE CASH" means all cash, revenues, receipts and funds
generated by, or
received from, Company
operations,
from the sale of
the
Company's assets or
business, and from all
other sources, less
the sum of
the following to
the extent paid or set aside by a majority consent of all
the Board of
Directors:
(i) all principal and interest payments on indebtedness of the
Company and
all other sums paid to lenders, including Initial
Shareholders when acting in the capacity as lenders;
(ii) all cash expenditures incurred incident to the normal
operation of the Company's business; and
(iii) such Reserves as
the Board of Directors
deems reasonably
necessary to the proper operation of the Company's business.
(m) "EXERCISE
DATE" shall mean the date on which
the Company or
Contributing
Initial Shareholder provides notice to Defaulting Initial
Shareholder
that the Company or a
Contributing
Initial Shareholder has
elected
to exercise the option to acquire a Defaulting Initial
Shareholder's
interest.
(n) "FAIR MARKET
VALUE" shall mean, with respect to any asset or
property,
the fair market value
thereof as
determined in good
faith by a
Majority-In-Interest. If a Majority-In-Interest of the Initial
Shareholders
cannot agree
upon a "Fair Market
Value" the
Majority-In-Interest
of the
Initial
Shareholders shall
select a qualified
independent
third-party to
appraise the
assets and property to determine the Fair Market Value,
which
determination
shall be binding on the Initial Shareholders.
(o) "FISCAL YEAR"
means the Company's
fiscal year, which shall be
December 31.
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(p) "INITIAL CAPITAL CONTRIBUTION" shall mean the amount (exclusive
of
Additional
Capital Contributions)
which the Initial Shareholders actually
pay as
Capital Contributions to the Company, whether in cash, by the
transfer of
assets to the Company or by services rendered.
(q) "SHARES"
shall mean the ownership interest, which an Initial
Shareholder owns
in the Company from time to time.
(r)
"MAJORITY-IN-INTEREST"
shall mean Initial
Shareholders owning a
simple majority
of the Percentage Interests in the Company.
(s) "PRESIDENT" shall
mean Bradford Miller as President or any Person
that
becomes the
President under the terms of this
Agreement.
Bradford
Miller shall be
the initial President of the Company, and shall serve until
he resigns or is
removed from office.
(t) "CHIEF FINANCIAL
OFFICER" shall mean BGR Corporation's appointee
or any Person
appointed by BGR that becomes the Chief
Financial Officer
under the terms
of this Agreement. BGR Corporation's appointee shall be the
initial Chief
Financial Officer of the Company,
and shall serve until
he
resigns or is
removed from office.
(u) "INITIAL SHAREHOLDER" shall mean each of the parties who
execute a
counterpart of
this Shareholder
Agreement as an
Initial Shareholder
and
each of the
parties who may
hereafter become
Additional
or Substituted
Initial
Shareholders.
To the extent the
President or the Chief
Financial
Officer has
purchased Interests in the Company, they will have all the
rights of an
Initial Shareholder with respect to such Interests.
(v) "MONETARY
DEFAULT"
shall
mean the failure of an Initial
Shareholder to
pay when due any Additional Capital Contribution or other
sum required to
be paid under this Agreement.
(w) "NON-MONETARY
DEFAULT" shall mean the failure of an Initial
Shareholder to
cure any default under this Agreement (other than a Monetary
Default,
for which there is no
curative period)
within thirty (30) days
after
delivery of a written notice of default from another Initial
Shareholder,
Chief Financial
Officer or the President, which notice shall
set forth in
detail the nature of the alleged default; provided that if
curative
performance cannot reasonably be completed within such thirty
(30)
day period, said period will be extended, provided that curative
performance
was begun within a reasonable time, not to exceed ten (10)
days,
after the delivery of the notice of default, and is diligently
pursued
thereafter.
Without intending to limit the generality of the
foregoing,
the following are included within the definition of a
Non-Monetary
Default:
(i) Attempted
dissolution
of the Company by any Initial
Shareholder other than pursuant to the provisions of this
Agreement;
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(ii) Attempted partitioning of the assets of the Company;
(iii)Withdrawal as an Initial Shareholder without the consent
of
all other Initial Shareholders;
(iv) Attempted or
actual assignment
or transfer of an
Interest
other than pursuant to the provisions of this Agreement.
(x) "ORGANIZATIONAL
EXPENSES" shall mean
those expenses
incurred in
connection with
the formation of the Company.
(y) "PERCENTAGE
INTEREST" shall be the percentage
interest of each
Initial
Shareholder in the capital of this Company as set forth in
Schedule
1, which shall
be the basis for
allocating all
requirements for
contract
payments,
property taxes and other operating cash expenses and needs of
the
Company.
(z) "PERSON" shall mean any individual or any legal entity,
and their
respective
heirs, executors, administrators, legal representatives,
successors, and
assigns.
(aa) "PRIME
RATE" shall mean the
rate of interest,
as of the first
business day of
each month, designated
in the Wall Street
Journal as the
"prime rate,"
the rate of interest charged by banks in the United States to
their
largest and most
credit-worthy
commercial
borrowers for
unsecured
loans
maturing in ninety (90) days, but in no event in excess of the
highest legal
rate in Arizona.
(bb) "PROFITS" shall
mean, for each Fiscal Year, the income and gains
of the Company determined in accordance with accounting principles
consistently
applied from year to year under the method of accounting
selected for the
Company and as reported, separately or in the aggregate,
as appropriate,
on the Company's informational tax return filed for federal
income tax
purposes.
(cc) "RESERVES" shall
mean, with respect to any fiscal period, funds
set aside or
amounts allocated
during such period to
reserves which shall
be maintained in
amounts deemed
sufficient by the majority consent of the
Board of
Directors for fixed and contingent obligations and working
capital
needs
and to pay
taxes, insurance, debt service and other costs and
expenses
incident to the ownership or operation of the Company's
business.
(dd) "TRANSFER" shall mean to sell, assign, exchange, transfer, give,
donate, pledge,
deposit, alienate, bequeath, devise or otherwise dispose of
or encumber to
any Person other than the Company.
(ee) "TREASURY
REGULATIONS" shall
mean the Regulations issued by the
Department of
the Treasury under the Code.
(ff) "WITHDRAWAL
EVENT" shall mean those events and circumstances
listed in Act
Section 29-733.
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ARTICLE II
CAPITALIZATION OF THE COMPANY; LOANS
2.1 INITIAL
CAPITAL CONTRIBUTIONS. The Initial Capital Contribution of each
Initial Shareholder is set forth opposite each Initial
Shareholder's
name on
Schedule 1 attached hereto. Each Initial Shareholder is required to
contribute
to the Company its Initial Capital
Contribution promptly
upon execution of this
Operating Agreement.
2.2 INITIAL
SHAREHOLDER LOANS AND
ADDITIONAL CAPITAL
CONTRIBUTIONS.
The
Initial Shareholders acknowledge that, to conduct its business authorized
herein, the Company will require funds to
cover expenses of management, day to
day operations, ordinary business expenses, losses and/or pay Company
obligations as set forth in COUSIN VINNIE'S
Italian Diner Franchise Corporation
Financial Projections to be completed and agreed to by a
majority of the Board
of Directors. To the extent that the Company determines that payments in
addition to scheduled Capital Contributions
are required, and if such additional
amounts cannot be obtained by the Company
from one or more lenders (other than
the Initial Shareholders) under terms and conditions acceptable to a
Majority-In-Interest of the Initial
Shareholders, then the Initial Shareholders,
by a majority vote, shall decide whether or
not such additional amounts shall be
provided to the Company by the Initial
Shareholders
and, if so,
whether such
additional amounts shall be provided by way of loans to the
Company by the
Initial Shareholders or by way of Additional
Capital Contributions from the
Initial Shareholders. Loans to the Company
by Initial Shareholders shall be made
in cash and shall be evidenced by
promissory notes in a form satisfactory to the
Chief Financial Officer. Such loans shall
earn interest at the Prime Rate and be
repayable on such terms as shall be
approved by the Chief Financial Officer with
consent from the majority of the Board of
Directors of the Company. Initial
Shareholder loans shall be fully repaid
(principal and
interest) prior to
any
dividends pursuant to Article IV hereof. Notwithstanding anything to the
contrary set forth herein, no Initial
Shareholder shall be
required to take any
action or perform any act, including,
without limitation,
the payment of money,
on behalf of or for the benefit of any
third party creditor.
2.3 CAPITAL CONTRIBUTIONS IN GENERAL. Except as otherwise expressly
provided for in this Agreement:
(a) no part of the
Capital Contributions of any
Initial Shareholder may be withdrawn
except as otherwise approved in writing by
all Non-Defaulting Initial Shareholders,
and (b) no Initial Shareholder shall be
entitled to demand or to receive property other than cash in return for its
Capital Contributions to the Company.
ARTICLE III
REDEMPTIONS AND DIVIDENDS
3.1 REDEMPTIONS.
As a general rule,
Initial Shareholders are expected to
hold their Interest in the Company for investment during the term of the
Company. Although bound by Article III of
this Agreement, an Initial Shareholder
may apply to redeem part or all of his
Interest, and a redemption may occur,
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upon the unanimous approval of all Initial Shareholders of the Company at a
price agreed upon by all Initial
Shareholders.
3.2
DIVIDENDS.
(a) CASH DIVIDENDS. Any Company Dividends shall be paid to the
Initial
Shareholders
from time to time (and at such intervals, but not less
frequently than
quarterly) as the Chief Financial Officer with the consent
of the majority
of the Board of Directors deems proper. Such proceeds shall
be paid pro rata
to the Initial
Shareholders
in accordance with their
Percentage
Interests.
(b) EFFECT OF
DEFAULTS. If any Initial Shareholder has caused a
Non-Monetary
Default to occur,
no amount shall be
paid to such Defaulting
Initial
Shareholder until the
Non-Monetary Default
has been cured. If any
Initial
Shareholder has caused a Monetary Default to occur, any dividend
to
such Defaulting
Initial Shareholder shall be subject to the right of offset
in favor of the
Company, subject to the rights of Contributing Initial
Shareholders
under any other provisions of this Agreement.
(c) EXCESS DIVIDENDS. If for any reason during a given Fiscal Year
any
Initial
Shareholder
receives dividends in excess of the amount to
which
such Initial
Shareholder should have been entitled pursuant to the terms of
this Agreement, then such excess
dividends shall be returned to the Company
and paid to the
Initial Shareholder
entitled to such
excess amount.
The
amounts of
dividends pursuant to
paragraph 3.2 hereof are to be determined
on a Fiscal Year
basis and any amounts
paid on a more
frequent basis are
for convenience
only and are not
controlling as to the total amounts to be
paid to an
Initial Shareholder for any Fiscal Year.
(d) RECORD DATE.
The Record Date for
the purpose of
receiving cash
dividends from
the Company shall be as set forth in Section 5.6.
3.3 LIMITATION
ON DIVIDENDS. The
power of the Chief
Financial Officer
to
pay dividends may not be used by the Chief
Financial Officer in
its position as
an Initial Shareholder to satisfy its
personal needs or those of its creditors,
nor shall its powers be used to satisfy the needs of any other Initial
Shareholder if making a payment of
dividends would be
contrary to the interests
of the Company and the other Initial
Shareholders. No dividend shall be declared
and paid unless, after the dividend is paid, the assets of the Company are
in
excess of all liabilities of the Company, except liabilities to Initial
Shareholders on account of their
contributions.
ARTICLE IV
RIGHTS AND OBLIGATIONS OF INITIAL SHAREHOLDERS
4.1 APPROVAL OF
SALE OF ALL ASSETS. The Initial Shareholders shall have the
right, by the affirmative vote of a Majority-In-Interest of the Initial
Shareholders, to approve the sale, exchange or other disposition of all, or
substantially all, of the Company's assets
which is to occur as part of a single
transaction or plan.
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4.2 PRIORITY AND RETURN OF CAPITAL. No Initial Shareholder shall have
priority over any other Initial
Shareholder, either as
to the return of Capital
Contributions or as to Profits, Losses or
dividends; provided
that this Section
shall not apply to loans (as distinguished
from capital contributions), which an
Initial Shareholder has made to the
Company.
4.3 LIMITATION OF AUTHORITY. Except as otherwise permitted by this
Agreement, no Initial Shareholder (except one who may also be a Corporate
Officer, and then only in his capacity as a
Corporate Officer
within the scope
of his authority hereunder) shall transact
any business for the Company or shall
have any authority or right to act for or
bind the Company.
4.4 REMOVAL OF INITIAL SHAREHOLDERS. Upon the redemption, either
involuntary or voluntary, of the entire Interest of a
Initial Shareholder,
or
upon the transfer of the entire Interest of
a Initial Shareholder,
he shall no
longer be considered an Initial Shareholder
or included in the definition of the
word "Initial Shareholder" as that term may appear
herein, for any purpose
whatsoever including, but not limited to, the right to
notice, vote or consent
as Initial Shareholder, to participate in or receive any subsequent income,
Profits or Losses of the Company,
make any further
contribution to the
capital
of the Company, or receive any cash
dividends from the Company.
4.5 NO RIGHT TO
DEMAND DIVIDEND.
No Initial
Shareholder
has a right, to
demand a dividend. No Initial Shareholder has a right to receive
any return of
his or her Capital Contribution in property other
than cash.
Specifically, no
Initial Shareholder may demand a dividend
of any portion of any real or personal
property.
4.6 NO RIGHT TO
PARTITION. Each Initial Shareholder waives his or her right
to maintain any action for partition
with respect to any of
the property of the
Company. No Initial Shareholder may call upon a court to divide or
distribute
the Property of the Company.
4.7 AUDIT. The
books of the Company shall be audited unless an audit is not
required for the business of the Company,
and a Majority-In-Interest of the
Initial Shareholders vote not to conduct an
audit.
ARTICLE V
MEETINGS OF INITIAL SHAREHOLDERS
5.1 ANNUAL
MEETING. An annual meeting of the Initial Shareholders shall be
held on the second Friday in April, or at
such other time as shall be determined
by the President or by a Majority-In-Interest of the Initial Shareholders,
commencing with the year 2005, for the purpose of the transaction of such
business as may come before the
meeting.
5.2 SPECIAL
MEETINGS. Special meetings of the Initial Shareholders, for any
purpose or purposes, unless otherwise prescribed by statute,
may be called by
the President or by a Majority-In-Interest
of the Initial Shareholders.
5.3 PLACE OF
MEETINGS. The party calling the meeting may
designate any
place, either within or outside the State of
Arizona, as the place
of meeting
for any meeting of the Initial
Shareholders. If no
designation is made, or if a
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special meeting be otherwise called, the place of meeting shall be held
at the
place of business designated in Section 1.4
above.
5.4 NOTICE OF
MEETINGS. Except as
provided in Section 5.5, written notice
stating the place, day and hour for which
the meeting is called shall be
delivered not less than three nor more than
fifty days
before the date of
the
meeting, either personally or by mail, by or at the direction of the party
calling the meeting, to each Initial Shareholder entitled to vote at such
meeting. If mailed, such notice shall be deemed to be
delivered two calendar
days after being deposited in the United States
mail, addressed to the
Initial
Shareholder at the Initial Shareholder's address as it appears on the books
of
the Company, with postage thereon prepaid.
If transmitted by way
of facsimile,
such notice shall be deemed to be delivered on the date of such facsimile
transmission to the telephone number for
the Initial Shareholder, which has been
supplied by such Initial Shareholder to the Company and identified as such
Initial Shareholder's facsimile number.
5.5 MEETING OF
ALL INITIAL SHAREHOLDERS. If all of the Initial Shareholders
shall meet at any time and place, either within or outside of the State of
Arizona, and consent to the holding of a meeting at such time
and place, such
meeting shall be valid without call or
notice, and at such meeting lawful action
may be taken.
5.6 RECORD DATE
FOR MEETINGS AND DIVIDENDS. For the purpose of determining
Initial Shareholders entitled to notice of or to vote
at any meeting of Initial
Shareholders or any adjournment
thereof, or Initial Shareholders entitled to
receive payment of any dividends, or in
order to make a determination of Initial
Shareholders for any other purpose,
the date on which
notice of the meeting is
mailed or the date on which the
resolution
declaring such
dividend is adopted,
as the case may be, shall be the record
date for such
determination of
Initial
Shareholders. When a determination of Initial
Shareholders entitled
to vote at
any meeting of Initial Shareholders has been made as provided in this
Section,
such determination shall apply to any
adjournment thereof.
5.7 QUORUM. A
Majority-In-Interest of the Initial Shareholders, represented
in person or by proxy, shall constitute a quorum at any meeting of Initial
Shareholders. In the absence of a quorum at any
such meeting, a majority of the
Interests so represented may adjourn the meeting from time
to time for a period
not to exceed 60 days without further
notice. However, if the adjournment is for
more than 60 days, or if after the adjournment a new record date is fixed for
the adjourned meeting, a notice of the adjourned
meeting shall be given to each
Initial Shareholder of record entitled to
vote at a meeting.
5.8 MANNER OF
ACTING. If a quorum is
present, the
affirmative
vote of a
Majority-In-Interest of the Initial
Shareholders shall be the act of the Initial
Shareholders, unless the vote of a greater or lesser
proportion
or number is
otherwise required by the Act, by the Articles of Organization, or by this
Operating Agreement.
5.9 PROXIES. At all meetings of Initial Shareholders, an Initial
Shareholder may vote in person or by proxy
executed in writing by the Initial
Shareholder or by a duly authorized
attorney-in-fact. Such
proxy shall be filed
with the President of the Company before or
at the time of the meeting. No proxy
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shall be valid after eleven months from the date of its execution, unless
otherwise provided in the proxy.
5.10 ACTION BY
INITIAL SHAREHOLDERS
WITHOUT A MEETING.
Action required or
permitted to be taken at a meeting of
Initial Shareholders
may be taken without
a meeting if the action is evidenced by one
or more written consents describing
the action taken, delivered to each Initial Shareholder entitled to vote,
executed by the unanimous consent of all
Initial Shareholders
entitled to vote,
a Majority-In-Interest or such other number
of Initial Shareholders required for
such action, and delivered to the President of
the Company for inclusion in the
minutes or for filing with the Company
records. Action taken
under this Section
is effective when Initial Shareholders
holding the requisite number of Interests
entitled to vote have signed the consents, unless the consents specify a
different effective date. The record date
for determining
Initial
Shareholders
entitled to take action without a meeting shall be the date the first
Initial
Shareholder signs a written consent.
5.11
WAIVER OF NOTICE. When any notice is required to be given to any
Initial Shareholder, a waiver thereof in writing signed
by any Person entitled
to act on behalf of the Initial
Shareholder
which is entitled to
such notice,
whether before, at, or after the time
stated therein, shall be equivalent to the
giving of such notice.
5.12 LOST
INITIAL SHAREHOLDERS.
In circumstances where a unanimous vote of
the Initial Shareholders is required and
one or more Initial Shareholders cannot
be located after legal notice under this Agreement is sent and a good faith
effort to find the Initial Shareholder(s) based on all
information available to
the President is made, the President may
vote for the Initial
Shareholder(s) or
appoint another Person to vote for the Initial Shareholder(s) with the
understanding that the Person casting the vote for the absent Initial
Shareholder(s) shall act prudently and in the best interests of the Initial
Shareholder(s) in light of the information
available at the time.
ARTICLE VI
RIGHTS AND DUTIES OF PRESIDENT,
CHIEF FINANCIAL OFFICER AND INITIAL SHAREHOLDERS
6.1 PRESIDENT.
Bradford Miller the shall be the initial
President of the
Company, and shall serve as the
President of the
Company until April
30, 2009
provided that, and as long as, the Company meets
the business
objectives set
forth in COUSIN VINNIE'S Franchise Corporation Financial Projections to be
completed and agreed to by a majority of
the Board of Directors (the "Financial
Projections"). The day-to-day business and affairs of the Company shall be
managed by its designated President. The President shall direct, manage and
control the business of the Company to the best of its
ability and shall have
full and complete authority, power and discretion to make any
and all decisions
and to do any and all things which the President shall deem to be reasonably
required to accomplish the business and objectives of the Company.
No Initial
Shareholder, or the President shall have the authority to act
for or bind the
Company without the vote of a
Majority-In-Interest of the Initial Shareholders.
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6.2 CHIEF
FINANCIAL OFFICER. BGR Corporation's appointee shall be the
initial Chief Financial Officer of the Company,
and shall serve as the
Chief
Financial Officer of the Company until
April 30, 2009 provided that, and as long
as, the Company meets the financial
business objectives set forth from time
to
time by the Board of the Directors of the
Company (the "Business
Objectives"),
the day-to-day financial business affairs of the Company shall be managed
exclusively by its designated Chief Financial Officer. The Chief Financial
Officer shall direct, manage and control the financial
business of the
Company
to the best of its ability and shall have
full and complete authority, power and
discretion to make any and all decisions and
to do any and all things which the
Chief Financial Officer shall deem to be
reasonably required to
accomplish the
business and objectives of the Company subject to overview of the Board of
Directors of the Company. The Chief Financial Officer shall not have the
authority to act for or bind the Company
without the consent of
the majority of
the Board of Directors of the Company.
6.3 NUMBER,
TENURE AND
QUALIFICATIONS.
The President and
Chief Financial
Officer of the Company and its respective
term shall be fixed
from time to time
by the affirmative vote from a majority of the Board of Directors of the
Company. The President and Chief Financial Officer shall hold office for
the
term for which it is elected and until its
successor shall have been elected and
qualified, unless earlier removed under Section 6.10. The
President and Chief
Financial Officer need not be a resident of the
State of Arizona or an Initial
Shareholder of the Company. If the President fails to meet the Business
Objectives, then Bradford Miller shall, upon
the request of the Company, resign
as President, and the Company shall elect a new President. If the Chief
Financial Officer fails to meet the
Business Objectives,
then BGR Corporation's
appointee shall, upon the request of the
Company, resign as Chief Financial
Officer, and the Company shall elect a new
Chief Financial Officer.
6.4 CERTAIN
POWERS OF THE
PRESIDENT.
Without limiting the generality of
Section 6.1, the President shall have power and authority, on behalf of the
Company subject to the affirmative
vote of a majority of
the Board of Directors
of the Company:
(a) To acquire property from any Person as the President may
determine.
The fact that an
Initial Shareholder is
directly or indirectly
affiliated
or connected with any such Person shall not prohibit the
President from
dealing with that Person;
(b) To purchase
liability and other
insurance,
including,
without
limitation,
life insurance on the President and key employees, and to
protect the
Company's property and business;
(c) To hold and own any Company real and/or personal properties in
the
name of the
Company;
(d) To borrow such amounts (not to exceed $100,000 in the aggregate)
as the President
may deem appropriate
for the business of the Company, to
make all
investment
decisions and to invest any Company funds
(by way of
example but not
limitation)
in time deposits,
governmental
obligations,
various
securities
including shares in
mutual funds, various
derivative
securities
including options or other investments;
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(e) To execute on behalf of the Company all instruments and
documents,
including,
without limitation,
checks; drafts;
promissory notes; security
instruments;
partnership agreements; and any other instruments or documents
necessary to the
business of the Company;
(f) To employ accountants, legal counsel, investment advisers,
managing agents
or other experts to perform services for the Company and to
compensate them
from Company funds;
(g) To act as "tax
matters partner"
pursuant to Section
6221 of the
Code;
(h) To enter into
any and all
other agreements on behalf of the
Company, with
any other Person or entity for any purpose;
(i) Employ, supervise
and coordinate
on behalf of the
Company, all
personnel,
except that the compensation paid to any Affiliate of an
Initial
Shareholder or
President must be approved by at least 80% of the Percentage
Interests;
(j) Pay all bills,
invoices and expenses
properly incurred by and on
behalf of the
Company;
(k) Except as
otherwise restricted
in this Agreement, to make all
decisions
regarding dividends including, but not limited to, deciding
when
and if dividends
shall be paid, determining the amounts and record date and
authorizing the
payments thereof to Initial Shareholders of record;
(l) Any matter relating to the purchase or acquisition, or the sale,
transfer,
conveyance, exchange,
or grant of option relating to any real or
personal
property;
(m) Obligate
the Company as a
guarantor,
endorser, accommodations
endorser or
surety for the obligation of any other Person;
(n) Institute
any proceeding at law or in equity or before
administrative
agencies or compromise
or settle claims against the Company
in any civil or
administrative action or proceeding;
(o) Acquire by lease,
purchase or otherwise any real or personal
property;
(p) Loan money to any Person;
(q) To substitute
in its stead as
President any entity which has, by
merger,
consolidation
or otherwise, acquired substantially all of the
President's
assets or equity
interests and continued its business, except
that, as a
Initial Shareholder, the President shall be subject to the
terms
and conditions
of Article VIII of this Agreement; and
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(r) To do and perform all other acts as may be necessary or
appropriate to
the conduct of the Company's business.
The President may act by a duly authorized attorney-in-fact. Unless
authorized to do so by this Agreement or by a Majority-In-Interest of the
Initial Shareholders, no Initial
Shareholder, agent, or
employee of the Company
shall have any power or authority to bind the Company in
any way, to pledge its
credit or to render it liable for any
purpose.
6.5 RESTRICTIONS AND
