Resignation Agreement - Quality Dining Inc. and Michael G. Sosinski
RESIGNATION AGREEMENT
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This Agreement is made as of October 25, 1996, by and between Quality Dining,
Inc. ("Corporation") and Michael G. Sosinski ("Employee").
RECITALS
A. Employee has been employed by Corporation to perform certain duties as
determined by Corporation during the term of Employee's employment.
B. Employee now desires to resign his employment with the Corporation
(including all offices and directorships) effective October 25, 1996,
according to the terms of this Agreement.
C. Incident to Employee's resignation, the Corporation is willing to pay
certain compensation to Employee and provide certain other benefits which
would not otherwise be due to Employee.
D. Employee and the Corporation desire to confirm by this Agreement the
acceptance of Employee's resignation and the termination of Employee's
employment as well as the acceptance by Employee of the consideration to
be furnished to him by the Corporation in consideration for the full and
complete release by Employee of the Corporation and its officers,
directors, employees, subsidiaries and affiliates.
NOW THEREFORE, in consideration of the terms and conditions set forth below, in
addition to other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties agree as follows:
1. Severance Pay. Corporation and Employee acknowledge that Employee's
employment with the Corporation (including all offices and directorships
with the Corporation) will terminate as of the end of the Corporation's
normal close of business on October 25, 1996 (the "Resignation Date"), and
that the Corporation will make severance payments to Employee in the total
amount of One Hundred Sixty Thousand Dollars ($160,000.00) (less taxes and
other legally required or authorized withholdings and deductions) (the
"Severance Payment"), payable to Employee as follows:
a) Fifty percent (50%) of the Severance Payment on the first regularly
scheduled payroll date following January 1, 1997;
b) Twenty-five percent (25%) of the Severance payment will be paid promptly
upon satisfactory completion of the Corporation's 1996 Fiscal Year audit; as
long as the audit does not reveal or uncover any material irregularities
within the Corporation's accounting practices; and
c) Twenty-five percent (25%) of the Severance Payment will be paid promptly
after the Corporation's annual meeting in March of 1997;
Provided, however, each of the payments specified in Paragraph 1(b) and (c)
above are contingent upon and shall be payable to Employee only if a
committee of outside directors of the Corporation determine, in their sole
discretion, that no issues, conditions, circumstances or complications exist
which would not otherwise exist had Employee discharged the duties of his
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office in the manner expected by the Corporation. Each of the payments in
this Paragraph 1 are severable and independent of each other and all other
provisions of this Agreement.
2. Stock Options. The Corporation agrees that all of the Employee's stock
options with the Corporation, both vested and unvested, will be vested by
the Corporation on the Resignation Date. The parties agree that all of the
Employee's stock options with the Corporation are accurately listed in
Exhibit A, attached hereto and made a part hereof (the "Options"). If not
sooner exercised, the Options will expire and terminate at the close of
business on October 24, 1999.
3. Vacation, Sick Leave and Personal Days. Employee agrees that he shall not be
entitled to and shall not receive any compensation for any accrued sick
days, vacation days and/or personal days, other than the compensation being
paid to him pursuant to this Agreement.
4. Other Benefits. Employee will be entitled to any benefits he is vested in on
the Resignation Date in the Corporation's retirement plan, in accordance
with the terms of such plan. Employee is not entitled to any other
Corporation benefits, except as stated in the Corporation's plans. The
Corporation will pay Employee's COBRA premiums for one (1) year from the
Resignation Date.
5. Corporation Stock. Employee is the owner of 36,927 shares of the
Corporation's common stock ("Stock"). If the Corporation's common stock does
not close at or above Thirty-Five Dollars ($35.00) per share ("Base Share
Price") on any date after the Resignation Date up to and including October
24, 1998, then Employee shall be entitled to the "Price Protection" in
accordance with the terms of this Paragraph. Subject to the foregoing,
Employee shall have the right, but not the obligation, to receive the Price
Protection by written notice to Corporation given no later than November 24,
1998. In such event, Corporation, at its option, shall either (i) pay
Employee the difference between (a) the Base Share Price and (b) the closing
price of Corporation's common stock on October 24, 1998 times the number of
shares of the Stock still owned by Employee on October 24, 1998 or (ii)
purchase the number of shares of the Stock still owned by Employee on
October 24, 1998 at the Base Share Price (the "Price Protection"). If
Corporation elects clause (ii), then upon the delivery of the applicable
purchase price by Corporation to Employee, Employee shall endorse to and
deliver the applicable stock certificates for the Stock and/or stock powers
and such other instruments as may be necessary to transfer the Stock to
Corporation or its designee. The Base Share Price and the number of shares
of the stock shall be equitably adjusted to reflect any mergers,
consolidations, stock splits, stock dividends or other similar events which
may occur subsequent to the Resignation Date.
6. Consulting Services. In consideration for the benefits and payments
specified in Paragraphs 1 and 2 above, Employee agrees to provide consulting
services to the Corporation from the Resignation Date through the date of
the Corporation's Annual Meeting in March of 1997. Employee's consulting
services shall include without limitation advising, consulting, counseling
and providing the Corporation with information concerning or relating to
Corporation's 1996 Fiscal Year audit ("Consulting Services"). The parties
estimate that the Consulting Services will require (but not be limited to)
approximately ten (10) hours per month. In addition to the Consulting
Services, Employee agrees to cooperate with Corporation and sign any
documents necessary to effectuate the intent of this Agreement, including
the execution and delivery of such other documents and records including,
without limitation, corporate minutes relating to any period Employee was an
officer or director of the Corporation.
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7. Non-Compete Restrictions. For a period of two (2) years after the
Resignation Date, Employee will not anywhere in the United States or Canada
independently or in association with others, engage in any work for, accept
any employment with, or render, directly or indirectly, advice, consulting
services or assistance of any kind to any person, partnership, corporation,
limited liability company, association, entity or other organization whose
principal or primary business is the baking, preparation and/or sale of
bagels, bagel sandwiches, cream cheeses and/or other such related products
of any sort for the duration of this period. Provided, however, the
foregoing shall not preclude Employee from rendering any such advice or
services to any bagel business operating in St. Joseph County provided such
business is not part of a system that has more than twenty-five (25) retail
outlets.
8. Full and Complete Release. Employee hereby unconditionally releases and
discharges Corporation from any claims, known or unknown, directly or
indirectly related to or in any way connected with Employee's employment
with Corporation or the resignation of Employee's employment with
Corporation. The parties agree and acknowledge that the claims or actions
released herein include, but are not limited to, those based on any common
law tort action or based on allegations of wrongful discharge and/or breach
of contract, and those alleging any violation or discrimination on the basis
of race, color, sex, religion, national origin, age, disability, or any
other basis under Title VII of the Civil Rights Act, Americans With
Disabilities Act, Family and Medical Leave Act, all as amended, or those
alleging any claim under any other federal, state, or local law, rule, or
regulation. Employee also agrees that Employee's rights under the
aforementioned statutes or any other federal, state, or local law, rule or
regulation are effectively waived by this Agreement.
9. Return of Property. Employee agrees that no later than five (5) days after
the Resignation Date, Employee shall return to Corporation all Corporation
property in Employee's possession or control, including, but not limited to,
Corporation documents, materials, computer disks, and other records.
10. Announcements. The Corporation and Employee agree not to make any derogatory
or negative comments concerning the other. Whenever Employee or Corporation
discuss, refer to, comment on or make any statements with regard to the
other party, both parties agree to discuss, refer to, comment on and make
any such statements with regards to the other party substantially in the
form and content as set forth in Exhibit B.
11. Definition of Corporation. The parties understand that as used in this
Agreement, "Corporation" includes Quality Dining, Inc. and all of their past
and present officers, directors, employees, trustees, agents, parents,
partners, shareholders, affiliates, principals, insurers, any and all
employee benefit plans (and any fiduciary of such plans) sponsored by the
aforesaid entities, and each of them, and each entity's subsidiaries,
predecessors, successors, and assigns, and all other entities, persons,
firms, or corporations liable or who might be subject to any claim or cause
of action arising out of or related to Employee's employment or Employee's
resignation of employment with the Corporation.
12. Enforceable. Employee further understands, and it is Employee's intent, that
in the event this Agreement is ever held to be invalid or unenforceable (in
whole or in part) as to any particular type of claim or charge or as to any
particular circumstances or provision, it shall remain fully valid and
enforceable as to all other claims, charges, circumstances and provisions.
As to any actions, claims, or charges that would not be released because of
the revocation, invalidity, or unenforceability of this Agreement, Employee
understands that the return of the severance payments described above, with
legal interest, is a prerequisite to asserting or bringing any such claims,
charges, or actions.
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13. Voluntary Agreement. Employee expressly acknowledges and agrees that he has
entered into this Agreement freely, knowingly and voluntarily and with full
knowledge and understanding of its terms and that it constitutes a binding
agreement releasing the Corporation from all claims arising out of
Employee's employment and separation from employment. Employee further
acknowledges that he has been given an opportunity to consult with
Employee's legal advisor prior to execution hereof.
14. Effective Date. This Agreement shall take effect seven (7) days after the
Employee executes it. The Employee shall have the right to revoke this
Agreement during the period of seven (7) days following his execution of
this Agreement. In order to revoke the Agreement, the Employee must notify
the undersigned representative of the Corporation, in writing, of his
decision to revoke, and said notice must be received by the undersigned
representative of the Corporation no later than seven (7) days following the
execution of this Agreement. If the Employee revokes this Agreement, he
shall promptly repay to the Corporation all consideration paid to the
Employee under Paragraphs 1 and 2 of this Agreement.
15. This Agreement shall be binding upon and inure to the benefit of the parties
and their heirs, successors and assigns.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date first
above written.
EMPLOYEE QUALITY DINING, INC.
/s/ Michael G. Sosinski By: /s/ Daniel B. Fitzpatrick
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Michael G. Sosinski Daniel B. Fitzpatrick
President and CEO
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EXHIBIT A
EMPLOYEE STOCK OPTIONS
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EXHIBIT B
Mike Sosinski was employed by Quality Dining, Inc. from February of 1983
through October of 1996. During that time, Quality Dining grew from 7 Burger
King restaurants with approximately $6,000,000.00 in annual sales to a Company
that operated and franchised a total of 558 quick service and casual theme
dining restaurants with approximately $450,000,000.00 in system-wide sales.
From the time this Company went public in March of 1994, Mike served as its
Chief Financial Officer with responsibility for the Corporation's financial, tax
and accounting functions. Mike has left the Company to pursue other business
interests and spend more time with his family. Mike is pleased to have had the
opportunity to work at Quality Dining as it grew to one of the nation's pre-
eminent restaurant companies and Mike believes that under the strong leadership
of Dan Fitzpatrick, Quality Dining will continue to enjoy the dynamic growth and
success which has been its hallmark.