Exhibit 10.2

MICHAEL O’DONNELL

TERMS OF EMPLOYMENT/

LETTER OF UNDERSTANDING AND SALARY CONTINUATION

AGREEMENT

Ruth’s Hospitality Group, Inc. (hereafter referred to as “Employer”) and Michael
O’Donnell, (hereinafter referred to as “Executive”) agree upon the following
terms of employment of Executive by Employer.

1. Duties. Executive shall be employed during the term of this Agreement as set
forth in Section 3 in the position of Executive Chairman. Executive will advance
the best interests of Employer at all times during his employment and shall at
all such times faithfully, industriously and to the best of his ability, perform
all duties as may be required of him by virtue of his title and position and in
accordance with the job description for his title and position as established by
the Employer’s Board of Directors and/or its Designee from time to time.
Executive shall comply with any and all written personnel and corporate policies
and employment manuals of Employer in the conduct of his duties that are applied
on a consistent basis. During the Term and any renewals thereof, Executive will
be nominated to the slate of proposed directors put to shareholder vote for
possible election as a member of the Board of Directors of Employer.

2. Extent of Service. Executive shall devote his full time and best efforts to
the performance of his duties. Executive shall not engage in any business or
perform any services in any capacity that would, in the reasonable judgment of
Employer, interfere with the full and proper performance by Executive of his
duties. Notwithstanding the foregoing, Executive shall be permitted to continue
to serve as a member of the Board of Directors of the following companies:
Logan’s Roadhouse, Hickory Tavern and any others that Employer may also permit
during the term of this Agreement.

 

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3. Term. Unless sooner terminated pursuant to the terms herein, this Agreement
shall remain in full force and effect for a period of one (1) year from the
Effective Date of this Agreement, which is hereinafter defined as August 10,
2018, provided, however, that commencing on the first anniversary of the
Effective Date and each subsequent anniversary of the Effective date, this
Agreement shall automatically renew and extend for additional one (1) year term
if Executive is not otherwise in default, remains in the employ of the Employer,
and this Agreement is not otherwise terminated. Once the Agreement is
terminated, it shall be of no further effect (with the exception of terms herein
which by their terms survive the termination of this Agreement). Notwithstanding
the foregoing, Employer must give Executive a minimum of 60 days’ notice prior
to the expiration of any given Term of its decision not to renew, otherwise this
Agreement shall renew for a successive term.

4. Compensation

a. Salary. For all duties to be performed by Executive in the capacity
referenced herein, Executive shall receive an initial annual base salary of
$675,000.00, which will be reduced on March 31, 2019 to $500,000.00 and paid in
accordance with Employer’s normal payroll practice, subject to annual review by
the Compensation Committee of the Board of Directors for any renewal term.

b. Bonus. Executive will be entitled to a discretionary bonus of up to 100% of
his base salary, subject to meeting or exceeding the budget and performance
targets as defined in writing by the Board of Directors on an annual basis
pursuant to the Employer’s Executive Bonus Plan or Home Office Bonus Program,
whichever is in effect (“Plan”) and which may be increased or decreased
according to the Plan, to be paid to Executive after the issuance of the
Employer’s audited financial statements relating to that year, assuming
Executive is actively employed by Employer at the end of the fiscal year.

 

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c. Equity. Pursuant to the terms and conditions of the Employer’s 2005 Long-Term
Equity Incentive Plan, as amended from time to time and the 2018 Omnibus
Incentive Plans(collectively the “Equity Plan”), Executive shall be granted
options and/or Equity in an amount to be determined by the express terms of the
Equity Plan.

d. Automobile Allowance Executive shall also receive a monthly automobile
allowance of not less than $1,000.00 per month during the term of this
Agreement.

5. Benefits.

a. Vacation/Leave - Executive shall be entitled to four (4) weeks of paid
vacation per calendar year, with normal sick and holiday leave as defined by
Employer’s written policies.

b. Benefit Plan - Executive shall be eligible to participate in the health and
welfare plans provided by Employer for Executives.

c. Retirement Benefits - Executive will be eligible for all applicable
retirement benefits offered by Employer, if any.

d. Summary Plan Descriptions – Where applicable, Executive should refer to the
Summary Plan Descriptions he will receive for a complete detailed explanation of
the benefits described in this paragraph. Executive understands that the Summary
Plan Descriptions are the controlling documents as to the nature of, and
entitlement to, these benefits.

e. Reimbursement of Expenses – In accordance with the Company’s expense
reimbursement policies, Employer agrees to reimburse Executive for reasonable
and appropriate Employer-related expenses (as determined by Employer) paid by
Executive in furtherance of his duties, including, but not limited to, travel
expenses, food, lodging, entertainment expenses and automobile expenses, upon
submission of proper accounting records for such expenses. Employer agrees to
reimburse Executive for in-transition living expenses and moving expenses
pursuant to its written relocation policy, including any terms in addition
thereto as may be agreed by the parties.

 

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6. Disability or Incapacity of Executive.

If, for a period of twelve (12) months during the term of this Employment
Agreement, Executive is disabled or incapacitated for mental, physical or other
cause to the extent that he is unable to perform his duties as herein
contemplated during said twelve (12) months, Employer shall immediately
thereafter have the right to terminate this Employment Agreement upon providing
ten (10) days written notice to Executive and shall be obligated to pay
Executive compensation up to the effective date of said termination. The right
of termination in this section in no way affects or diminishes other rights of
termination as stated in this Employment Agreement, Equity or Bonus Plan.

7. Termination.

a. Notwithstanding any other provision hereof, Executive’s employment shall be
terminated immediately: 1) upon his death; 2) notice after disability as defined
in Section 6; 3) Executive’s discharge with or without Cause; or 4) Executive’s
resignation with or without Good Reason.

b. For purposes of this Agreement, Executive’s employment shall be terminated by
the death of Executive as of the date of death. In the event of the death of
Executive, Company’s obligations hereunder shall automatically cease and
terminate provided, however, that Company shall pay Executive’s accrued and
earned but unpaid Salary, and other compensation and defined benefits

 

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from any Employer policy in effect at the time of death (if any) owed as of the
date of his death to: the beneficiary or beneficiaries designated in writing by
Executive to Company and delivered to Company prior to Executive’s death; or, in
the absence of such designation, in accordance with Section 222.15, Florida
Statutes, or if there are no such family members, then to Executive’s estate. No
other monies will be due and owing to Executive, his beneficiary or
beneficiaries, to any family members, or to his estate.

c. For purposes of this Agreement, “Cause” shall mean (i) Executive’s theft or
embezzlement, or attempted theft or embezzlement, of money or property of
Employer, his perpetuation or attempted perpetuation of fraud, or his
participation in a fraud or attempted fraud, on Employer or his unauthorized
appropriation of, or his attempt to misappropriate, any tangible or intangible
assets or property of Employer, (ii) any act or acts of disloyalty, misconduct
or moral turpitude by Executive injurious to the interest, property, operations,
business or reputation of Employer or his commission of a crime which results in
injury to Employer or (iii) his willful disregard of lawful directive given by
the Board or a violation of an Employer employment policy injurious to the
interest of the Employer. Executive may not be terminated for cause under
(ii) and (iii) unless provided notice and the same has not been cured within 10
business days. Cause shall not include termination due to Death or Disability.

d. Should Employer terminate Executive’s employment for cause, as defined in
Section 7.c, then, Executive is entitled to no more than his salary through the
date of termination, any unused vacation days, unreimbursed expenses, car
allowance, earned but unpaid bonus per Plan. All vested but not exercised option
rights will be subject to repurchase by Employer according to the terms of the
Equity Plan.

 

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e. Employer reserves the right to terminate Executive’s employment without
cause, as defined in Section 7.c. However, in the event that occurs, then: 1)
Executive will receive the remaining cash compensation owed to the Executive
through the remainder of the given Term as if he was still employed through the
end of the Term;; 2) Executive will be eligible to receive eighteen (18) months
continued health, welfare and retirement Benefits (as defined hereinabove),
according to the same terms and conditions Executive would have been entitled to
had Executive’s employment with Employer continued through the end of the
respective reporting period; 3) eighteen (18) monthly payments of the automobile
allowance Executive would have been entitled to had Executive’s employment with
Employer continued through the end of the respective reporting period and that
includes reimbursement for fuel and routine maintenance costs for one
automobile; 4) unreimbursed expenses; and 5) all vesting rights of Executive’s
stock options and restricted stock granted during Executive’s tenure shall
continue as if the Executive was still employed notwithstanding any term of the
Equity Plan to the contrary. The payment of all amounts under this Section 7.e
is contingent on Executive’s compliance with Sections 8 and 9, and the signing
of a customary general release in favor of the Employer. Employer and Executive
intend that any amounts or benefits payable or provided under this Agreement
comply with the provisions of, or exemptions from, Section 409A of the Internal
Revenue Code and the treasury regulations relating thereto so as not to subject
Executive to the payment of the tax, interest, and any tax penalty which may be
imposed under Code Section 409A. The provisions of this Agreement shall be
interpreted in a manner consistent with such intent.

f. Should Executive resign his employment for Good Reason, as defined below,
Executive will receive severance equal to that appearing in Section 7.e (1-5).
The payment of all amounts under this Section 7(f) is contingent upon
Executive’s compliance with Sections 8 and 9, and the signing of a customary
general release in favor of the Employer.

 

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g. For purposes of this Agreement, “Good Reason” shall mean (i) the assignment
by the Board to Executive of any material duties that are clearly inconsistent
with Executive’s status, title and position as Executive Chairman; (ii) a
failure by Employer to pay Executive any amounts required to be paid under this
Agreement, which failure continues uncured for a period of fifteen (15) days
after written notice thereof is given by Executive to the Board;
(iii) relocation of Employer requiring Executive to relocate; (iv) Employer
provides Executive notice 60 days before expiration of a given Term of its
decision not to renew this Agreement; or (v) the Agreement is renewed through
and including August 10, 2020 and Executive provides 30 days’ notice to the
Employer that the Executive wishes to retire on August 10, 2020.

h. Executive understands that should Executive resign his employment without
Good Reason, then Executive is entitled to no more than his salary through the
date of termination (said termination date to be determined by Employer upon
notice of resignation), any earned but unused vacation days, unreimbursed
medical, earned by unpaid bonus per Plan. All vested but not exercised option
rights will be subject to repurchase by the Employer according to the terms of
the Equity Plan.

i. Any termination (voluntary or involuntary) of Executive’s employment shall
also trigger Executive’s immediate resignation as a member of the Employer’s
Board of Directors (and all affiliates).

j. Notwithstanding the foregoing, and in the event of a change in the
composition of the Board of Directors at any time between the date that this
Agreement is effective and two years thereafter whereby more than a majority of
the Board members in place at the time this Agreement is effective resign or are
otherwise replaced and Executive is terminated without cause by the newly
comprised Board of Directors, Executive shall receive, in addition to the
benefits in Section 7.e (1-5), an additional payment of fifty-percent (50%) of
his annual base salary as of the date of termination.

 

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k. Notwithstanding the foregoing, and in the event of a sale of Employer or
substantially all of Employer’s assets resulting in a change in control of the
Employer (as such transactions are defined in the Equity Plan) at any time
during the term of this Agreement, in addition to the benefits in Section 7.e
(1-5), there shall be an accelerated vesting of all equity grants
notwithstanding any contrary terms of the Equity Plan.

8. Disclosure of Information. Executive agrees that he will not, during
employment or any time after termination of employment hereunder, without
authorization of Employer, disclose to, or make use of for himself or for any
person, corporation or other entity, any files, videos, trade secrets, papers,
photographs, presentations, recipes, specifications, drawings, salary
structures, sources of income, business plans, minutes of meetings, contractual
arrangements, or other confidential

information concerning the business, clients, methods, operations, financing or
services of Employer. Trade secrets and confidential information shall mean
information disclosed to Executive or known by him as a consequence of his
employment by Employer, and not generally known to the restaurant industry.

9. Non-Compete.

a. In further consideration of the compensation to be paid to Executive
hereunder, Executive acknowledges that in the course of his employment with
Employer and its Subsidiaries and Affiliates he shall become familiar, and
during his employment with Employer he has become familiar, with Employer’s
trade secrets and with other Confidential Information concerning

 

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Employer and its predecessors and its Subsidiaries and Affiliates and that his
services have been and shall be of special, unique and extraordinary value to
Employer. Therefore, Executive agrees that during his employment and for a
period of one year following his last day of employment (hereafter referred to
as the “Non-compete Period”), Executive shall not directly or indirectly own any
interest in, manage, control, participate in, consult with, render services for,
or in any manner engage in any business or enterprise identical to or similar to
any such business which is engaged in by Employer, its Subsidiaries or
Affiliates or any of their respective franchises, which shall include any
restaurant business that derives more than 25% of its revenues from the sale of,
steak and steak dishes and which has an average guest check greater than $65,
escalating by five percent (5%) per year, (the “Business”), as of the date of
this Agreement and which is located in the United States, which shall for
purposes of illustration and not limitation include the following chains and
their parent companies, subsidiaries and other affiliates: Morton’s Restaurant
Group, The Palm, Smith & Wollensky, Del Frisco’s, Sullivan’s, The Capital
Grille, Mastro’s and Fleming’s. Nothing herein shall prohibit Executive from
being a passive owner of not more than 2% of the outstanding stock of any class
of a corporation that is publicly traded, so long as Executive has no active
participation in the business of such corporation. This restriction will not
apply if Executive is employed as an officer of a business, including, but not
limited to, a casino or hotel, that as an ancillary service provides fine dining
as defined in this paragraph. The term “ancillary” assumes that less than
fifty-percent 50% of the business revenues are derived from its dining
facilities.

b. During the Non-compete Period, Executive shall not directly or indirectly
through another entity (i) induce or attempt to induce any non-hourly or
management Executive of Employer or any Subsidiary or Affiliate to leave the
employ of Employer or such Subsidiary or Affiliate, or in any way interfere with
the relationship between Employer or any Subsidiary or Affiliate and

 

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any Executive thereof, (ii) solicit, directly or indirectly, any person who was
an Executive of Employer or any Subsidiary or Affiliate at any time during the
Employment Period, unless such person responded to a general solicitation or
(iii) induce or attempt to induce any customer, supplier, licensee, licensor,
franchisee or other business relation of Employer or any Subsidiary or Affiliate
to cease doing business between any such customer, supplier, licensee or
business relation and Employer or any Subsidiary or Affiliate (including,
without limitation, making any negative, derogatory or disparaging statements or
communications regarding Employer or its Subsidiaries, Affiliates, Executives or
franchisees).

10. Surrender of Books and Records. Executive acknowledges that all files,
lists, books, records, photographs, videotapes, slides, specifications, drawings
or any other materials used or created by Executive or used or created by
Employer in connection with the conduct of its business, shall at all times
remain the

property of Employer and that upon termination of employment hereunder,
irrespective of the time, manner or cause of said termination, Executive will
surrender to Employer all such files, lists, books, records, photographs,
videotapes, slides, specifications, drawings or any other materials.

11. Severability. If any provision of this Agreement shall be held invalid or
unenforceable, the remainder of this Letter shall, nevertheless, remain in full
force and effect. If any provision is held invalid or unenforceable with respect
to particular circumstances, it shall, nevertheless, remain in full force and
effect in all other circumstances.

12. Notice. All notices required to be given under the terms expressed hereunder
shall be in writing, shall be effective upon receipt, and shall be delivered to
the addressee in person or mailed by certified mail, returned receipt requested:

 

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If to Employer, addressed to:

Ruth’s Hospitality Group, Inc.

Ruth’s Hospitality Group, Inc.

1030 W. Canton Avenue, Suite 100

Orlando, FL 32789

Attn: General Counsel

If to Executive, addressed to:

Michael O’Donnell

at the address contained in records of the Employer as updated from time to time

or such other address as a party shall have designated for notices to be given
to him or it by notice given in accordance with this paragraph.

13. Governing Law and Resolution of Dispute. Executive’s terms of employment
shall be governed by and construed in accordance with the laws of or applicable
to the State of Florida. Any dispute, controversy or claim arising out of or
relating to Executive’s terms of employment, or the breach therefore, shall be
resolved by arbitration conducted in accordance with the rules then existing of
the American Arbitration Association, applying the substantive law of the State
of Florida. The parties further agree that any such arbitration shall be
conducted in Seminole County, Florida.

Date: June 4, 2018

 

WITNESS:     RUTH’S HOSPITALITY GROUP, INC.

 

        By:  

/s/ Robin Selati

      Title:   Lead Director

 

   

/s/ Michael O’Donnell

      MICHAEL O’DONNELL

 

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