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EXHIBIT 10.10
EMPLOYMENT AGREEMENT
This Agreement is made as of August 12, 1996 by and between FAMOUS
DAVE'S OF AMERICA, INC., a Minnesota corporation (the "Company"), and MARK A.
PAYNE (the "Executive").
W I T N E S S E T H
WHEREAS, the Company desires to employ Executive in accordance with
the terms and conditions stated in this Agreement; and
WHEREAS, Executive desires to accept that employment pursuant to the
terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the covenants and agreements
contained herein, the parties hereto agree as follows:
I. EMPLOYMENT
1.1 Employment As Vice President of Finance and Chief Financial
Officer. The Company hereby employs Executive as Vice President of Finance and
Chief Financial Officer and Executive accepts such employment pursuant to the
terms of this Agreement. Executive shall report to and take direction from the
Chairman of the Board and the Board of Directors. The Executive will perform
those duties which are usual and customary for a vice president of finance and
chief financial officer of a restaurant enterprise. Executive shall be
employed at the Company's corporate offices. He shall perform his duties in a
manner reasonably expected of a vice president of finance and chief financial
officer of a restaurant company.
1.2 Term. Employment shall be for a term commencing August 12,
1996 and continuing until the earlier of (i) August 12, 1999 or (ii) the date
Executive's employment terminates pursuant to Article III hereof.
II. COMPENSATION, BENEFITS AND PERQUISITES
2.1 Base Salary. During the term and effectiveness of this
Agreement, the Company shall pay Executive an annualized base salary ("Base
Salary") at the annual rate of $125,000. The Base Salary shall be payable in
equal installments in the time and manner that other employees of the Company
are compensated. The Board of Directors of the Company will review the Base
Salary at least annually, and may, in its sole discretion increase it to
reflect performance, appropriate industry guideline data or other factors.
2.2 Bonus. Executive will receive a bonus in the amount of
$25,000 upon the closing of the Company's Initial Public Offering, if any. The
Company also agrees to consider an annual bonus
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based on Executive's performance to be determined at the end of each year of
service, at the discretion of the Company's Board of Directors.
2.3 Vacations. Executive shall be entitled to three weeks paid
vacation, or such greater amount of time as determined by the Company's Board
of Directors.
2.4 Employee Benefits. Until the Company adopts a benefit plan,
Executive shall be entitled to the usual and customary benefits and perquisites
which the Company generally provides to its other executives under its
applicable plans and policies (including, without limitation, group health,
group dental and group life coverage). The Company also agrees to pay 75% of
the COBRA continuation premiums for Executive's health and dental insurance
currently maintained by Executive and his family for the period provided under
COBRA. Once the Company adopts a benefit plan, Executive shall be entitled to
the benefits which the Company provides to its other executives under such
plan. Executive shall pay any contributions which are generally required of
executives to receive any such benefits.
III. TERMINATION OF EXECUTIVE'S EMPLOYMENT
3.1 Termination of Employment. Executive's employment under this
Agreement may be terminated by the Company or Executive at any time for any
reason; provided, however, that if Executive's employment is terminated by the
Company during the term of this Agreement for a reason or disability other than
for cause as defined in Section 3.2 below he shall continue to receive his Base
Salary under Section 2.1 for a period of six months from the date of
termination, if such termination occurs in the first year of service. If such
termination occurs after the first year of service, during the term of this
Agreement for a reason or disability other than for cause as defined in Section
3.2 below he shall continue to receive his Base Salary under Section 2.1 for a
period of twelve months from the date of termination. The Executive's
employment under this Agreement may be terminated by Executive at any time for
any reason. The termination shall be effective as of the date specified by the
party initiating the termination in a written notice delivered to the other
party, which date shall not be earlier than the date such notice is delivered
to the other party. This Agreement shall terminate in its entirety immediately
upon the death of Executive. Except as expressly provided to the contrary in
this section or applicable law, Executive's rights to pay and benefits shall
cease on the date his employment under this Agreement terminates.
3.2 Cause. For purposes of this Article III, "cause" shall mean
only the following: (i) commission of a felony; (ii) theft or embezzlement of
Company property or commission of similar acts involving moral turpitude; or
(iii) the failure by Executive to substantially perform his material duties
under this Agreement (excluding nonperformance resulting from Executive's
disability) which willful failure is not cured within thirty (30) days after
written notice from the Chairman of the Board of Directors of the Company
specifying the act of willful nonperformance or within such longer period (but
no longer than ninety (90) days in any event) as is reasonably required to cure
such willful nonperformance. Notwithstanding the foregoing, Executive shall
not be deemed to have been terminated for "cause" unless and until there shall
have been delivered to Executive a copy of a
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resolution duly adopted by the affirmative vote of the Board at a meeting of
the Board called and held for this specific purpose.
3.3 Disability. If Executive has become disabled such that he
cannot perform the essential functions of his job with or without reasonable
accommodation, and the disability has continued for a period of more than
ninety (90) days, the Board of Directors of the Company may, in its discretion,
terminate his employment under this Agreement. Upon any such termination for
disability, Executive shall be entitled to such disability, medical, life
insurance, and other benefits as may be provided generally for disabled
employees of the Company during the period he remains disabled.
3.4 Notice. Executive must provide the Company with at least 30
days written notice if Executive desires to terminate his employment under this
Agreement.
IV. CONFIDENTIALITY
4.1 Prohibitions Against Use. Both parties to this Agreement
acknowledge and agree that during the term of this Agreement they may have
access to various trade secrets and confidential business information
("Confidential Information") of each other. Each party agrees that it shall
use such Confidential Information solely in connection with his obligations
under this Agreement and shall maintain in strictest confidence and shall not
disclose any such Confidential Information, directly or indirectly or use such
information in any other way during the term of this Agreement or for a period
of one (1) year after the termination of this Agreement. The parties further
agree to take all reasonable steps necessary to preserve and protect the
Confidential Information. The provisions of this Section shall be equally
applicable to each parties' officers, directors, agents or employees. The
provisions of this Section shall not apply to information which (i) was in
possession of a party prior to receipt from the other party, or (ii) is or
becomes generally available to the public other than as a result of a
disclosure by a party, its directors, officers, employees, agents or advisors,
or (iii) becomes available to a party from a third party having the right to
make such disclosure.
4.2 Remedies. Executive acknowledges that the Company's remedy at
law for any breach or threatened breach by Executive of Section 4.1 will be
inadequate. Therefore, the Company shall be entitled to injunctive and other
equitable relief restraining Executive from violating those requirements, in
addition to any other remedies that may be available to the Company under this
Agreement or applicable law.
V. NON-COMPETITION
5.1 Agreement Not to Compete. Executive agrees that, on or before
the date which is two (2) years after the date Executive's employment under
this Agreement terminates, he will not, unless he receives the prior approval
of the Board of Directors of the Company, directly or indirectly engage in any
of the following actions:
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(a) Own an interest in (except as provided below),
manage, operate, join, control, lend money or render financial or
other assistance to, or participate in or be connected with, as an
officer, employee, partner, stockholder, consultant or otherwise, any
entity whose primary business is the retail sale of barbeque food.
However, nothing in this subsection (a) shall preclude Executive from
holding less than one percent of the outstanding capital stock of any
corporation required to file periodic reports with the Securities and
Exchange Commission under Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the securities of which are listed
on any securities exchange, quote on the National Association of
Securities Dealers Automated Quotation System or traded in the
over-the-counter market.
(b) Intentionally solicit, endeavor to entice away from
the Company, or otherwise interfere with the relationship of the
Company, any person who is employed by or otherwise engaged to perform
services for the Company (including, but not limited to, any
independent sales representatives or organizations), whether for
Executive's own account or for the account of any other individual,
partnership, firm, corporation or other business organization.
If the scope of the restrictions in this section are determined by a court of
competent jurisdiction to be too broad to permit enforcement of such
restrictions to their full extent, then such restrictions shall be construed or
rewritten (blue-lined) so as to be enforceable to the maximum extent permitted
by law, and Executive hereby consents, to the extent he may lawfully do so, to
the judicial modification of the scope of such restrictions in any proceeding
brought to enforce them.
VI. MISCELLANEOUS
6.1 Amendment. This Agreement may be amended only in writing,
signed by both parties.
6.2 Entire Agreement. This Agreement contains the entire
understanding of the parties with regard to all matters contained herein.
There are no other agreements, conditions or representations, oral or written,
expressed or implied, with regard thereto. This Agreement supersedes all prior
agreements relating to the employment of Executive by the Company.
6.3 Assignment. This Agreement shall be binding upon, and shall
inure to the benefit of parties and their respective successors, assigns, heirs
and personal representatives and any entity with which the Company may merge or
consolidate or to which the Company may sell substantially all of its assets.
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6.4 Notices. Any notice required to be given under this Agreement
shall be in writing and shall be delivered either in person or by certified or
registered mail, return receipt requested. Any notice by mail shall be
addressed as follows:
If to the Company, to:
Famous Dave's of America, Inc.
12700 Industrial Park Boulevard
Suite 60
Plymouth, MN 55441
Attention: President
If to Executive, to:
Mark A. Payne
8860 Flesher Circle
Eden Prairie, MN 55347
or to such other addresses as either party may designate in writing to the
other party from time to time.
6.6 Waiver of Breach. Any waiver by either party of compliance
with any provision of this Agreement by the other party shall not operate or be
construed as a waiver of any other provision of this Agreement, or of any
subsequent breach by such party of a provision of this Agreement.
6.7 Severability. If any one or more of the provisions (or
portions thereof) of this Agreement shall for any reason be held by a final
determination of a court of competent jurisdiction to be invalid, illegal, or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions (or portions of the provisions) of this
Agreement, and the invalid, illegal or unenforceable provisions shall be deemed
replaced by a provision that is valid, legal and enforceable and that comes
closest to expressing the intention of the parties hereto.
6.8 Governing Law. This Agreement shall be interpreted and
enforced in accordance with the laws of the State of Minnesota, without giving
effect to conflict of law principles.
6.9 Arbitration. Any controversy or claim arising out of or
relating to this Agreement or the breach of this Agreement or the breach of any
exhibits attached to this Agreement shall be settled by arbitration in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association, and a judgment upon the award rendered by the arbitrator(s) may be
entered in any court having jurisdiction. The arbitration award shall be
subject to review only in the manner provided in the Uniform Arbitration Act as
adopted in Chapter 572, Minnesota Statutes, as the Act is amended at the time
of submission of the issue to arbitration. The arbitrator(s) shall have the
authority to award the prevailing party its costs and reasonable attorney's
fees which shall be paid by the non-
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prevailing party. In the event the parties hereto agree that it is necessary
to litigate any dispute hereunder in a court, the non-prevailing party shall
pay the prevailing party its costs and reasonable attorney's fees.
Notwithstanding anything in this Section 6.9 to the contrary, Executive shall
be entitled to seek specific performance of Executive's rights to be paid until
the date of termination during the pendency of any dispute or controversy
arising under or in connection with this Agreement or exhibits attached to this
Agreement. Further, the Company shall be entitled to seek an injunction or
restraining order in a court of competent jurisdiction to enforce the provision
of Article IV and Article V.
IN WITNESS WHEREOF, the parties have executed this Agreement effective
as of the date set forth above.
FAMOUS DAVE'S OF AMERICA, INC.
By
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Its Chairman of the Board
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Mark A. Payne
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