Exhibit 10.1
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Effective as of November 12, 2008 between
AFC Enterprises, Inc. (the “Company”) and
Harold M. Cohen (“Employee”)
     WHEREAS, the Company desires to continue the employment of Employee and to
enter into an agreement embodying the terms of such employment; and
     WHEREAS, Employee desires to accept such employment and to enter into such
agreement;
     NOW, THEREFORE, in consideration of the promises and mutual covenants
contained herein and for other good and valuable consideration, the parties
agree as follows:
     1. Term of Agreement.
     This Agreement shall be effective as of the date hereof and, unless earlier
terminated pursuant to Section 8 or Section 9 hereof, shall be for an initial
term of one (1) year (the “Term”). The Term of this Agreement and Employee’s
employment hereunder will automatically be extended for an additional one-year
period following the expiration of each year of employment hereunder (the
“Renewal Date”), without further action by Employee or the Company. Such
automatic one-year renewal shall continue from year to year unless and until
either the Company or Employee gives to the other written notice not less than
thirty (30) days prior to the applicable Renewal Date of its decision not to
renew for an additional one year.
     For purposes of this Section 1 only, the first “year” of the Term shall be
deemed to begin as of the date hereof and end on December 27, 2009, and each one
(1) year period thereafter shall coincide with the Company’s fiscal year.
     2. Employment.
     2.01 Position. Beginning on November 12, 2008 (the “Restatement Date”),
Employee shall serve as Senior Vice President — Legal Affairs, General Counsel,
Chief Administrative Officer and Secretary of the Company and its Popeyes
Chicken & Biscuits division, and shall perform such duties consistent with his
position as may be assigned to him from time to time by the Chief Executive
Officer of the Company (the “CEO”) or the Board of Directors of the Company (the
“Board”). Employee shall perform his duties hereunder at the Company’s offices
at 5555 Glenridge Connector, NE, Suite 300, Atlanta, Georgia, subject to such
reasonable amount of travel as is necessary to render the services provided
hereunder.
     2.02 Time and Efforts. Employee, so long as he is employed hereunder, shall
devote his full business time and attention to the services required of him
hereunder, except as otherwise agreed and for vacation time and reasonable
periods of absence due to sickness or personal
Employee’s Initials:
 

 

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injury, and shall use his best efforts, judgment and energy to perform, improve
and advance the business and interests of the Company in a manner consistent
with the duties of his position. Anything herein to the contrary
notwithstanding, nothing shall preclude Employee from (i) serving on the boards
of directors of trade associations; (ii) engaging in charitable activities and
community affairs; or (iii) managing his personal investments and affairs,
provided that the activities described in the preceding clauses (i) through
(iii) do not interfere with the proper performance of his duties and
responsibilities hereunder.
     3. Base Salary.
     Beginning on the Restatement Date, the Company shall pay Employee, in equal
installments no less frequently than monthly, a base salary at the rate of no
less than Two Hundred Eighty Thousand Dollars ($280,000 U.S.) per annum (the
“Base Salary”) during the term hereof. The Employee’s Base Salary shall be
reviewed by the Board on an annual basis.
     4. Incentive Pay.
     4.01 Annual Plan. The Board of Directors of the Company, acting in its sole
discretion, shall annually, at the beginning of each fiscal year of the Company,
approve an annual incentive plan (the “Annual Incentive Plan”) for Employee,
which Plan shall contain such terms and provisions as the Board shall determine.
The Annual Incentive Plan shall set forth the specific financial and performance
goals which must be achieved for Employee to be entitled to receive payment
under such Annual Incentive Pay. Any amounts payable to Employee pursuant to the
Annual Incentive Plan is hereinafter referred to as “Incentive Pay”.
     4.02 Target Incentive Pay. The target Incentive Pay (“Target Incentive
Pay”) for Employee for the 2008 fiscal year of the Company shall be as follows:
One Hundred Fifty Four Thousand Dollars (U.S. $154,000); provided, however, that
the Target Incentive Pay with respect to any fiscal year is subject to, and may
be modified by, the Annual Incentive Plan approved by the Board pursuant to
Section 4.01 above and this Section 4.02 shall be read accordingly. After 2008,
the Target Incentive Pay for Employee will be set by the Board for each fiscal
year and will be included in the Annual Incentive Plan for such year.
     4.03 Payment of Incentive Pay. If Employee is entitled to payment of any
Incentive Pay for any fiscal year, an accounting will be furnished and payment
will be made to Employee as set forth in the Annual Incentive Plan, but in no
event later than two and one-half months following the end of each fiscal year.
     4.04 Termination of Employment. If Employee’s employment hereunder shall
terminate other than pursuant to Sections 8.03 or 8.04, Employee shall receive,
at the time contemplated by the Annual Incentive Plan, such Incentive Pay, if
any, to which he would have been entitled under the terms of the Annual
Incentive Plan had Employee remained in the employ of the Company for the entire
fiscal year in which such termination occurs. If Employee’s employment hereunder
shall terminate pursuant to (a) Section 8.03, the provisions of Section 8.03
shall determine the amount of Incentive Pay payable to Employee; or
(b) Section 8.04, no Incentive Pay shall be payable to Employee after such
termination.

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     5. Equity Compensation.
     As part of the Employee’s compensation, Employee may be granted stock
options, restricted stock or other forms of equity compensation in the future
based upon Employee’s performance as determined in the sole discretion of the
Board.
     6. Employee Benefits.
     6.01 Life Insurance. During the Term and any renewal term of this Agreement
Employee shall be entitled to term life insurance coverage paid by the Company
with a death benefit in an amount of $1,100,000 (the “Death Benefit”), payable
solely from, and to the extent of, the Death Benefit proceeds payable under such
life insurance policy.
     6.02 Disability Insurance.
          (a) During the Term, and any renewal term of this Agreement, Employee
shall be entitled to disability insurance coverage in an amount not less than
his disability coverage on the Restatement Date of this Agreement and the
Company shall maintain in full force and effect during the Term a Supplemental
Disability Policy which will supplement the benefits payable under any
disability benefit provided to Employee by the Company under its basic employee
health care benefit program. Subject to Section 6.06 below, with respect to a
disability as defined in the Supplemental Disability Policy (a “Policy
Disability”) occurring after the Company has obtained the Supplemental
Disability Policy, the total monthly disability benefit (the “Disability
Benefit”) payable to Employee under all disability policies maintained by the
Company, after a maximum elimination period of ninety (90) days, shall be in
accordance with the terms and conditions of the Company executive disability
program.
          (b) Notwithstanding anything herein to the contrary, if the premiums
for the Supplemental Disability Income Policy for Employee shall exceed regular,
non-rated premiums, the Company may, but shall have no obligation to, fund such
excess. In the event the Company determines not to fund such excess it shall
promptly notify Employee and Employee may, at his option, elect to pay the
excess. If Employee fails to pay such excess or if for any other reason the
Company, after reasonable efforts, is not able to obtain the Supplemental
Disability Policy required herein, then Employee shall not be entitled to the
Supplemental Disability Policy hereunder except as may otherwise be determined
in the discretion of the Company and set forth in writing.
          (c) If the definition of a Policy Disability does not satisfy the
requirements for a payment based on a “disability” under § 409A of the Code and
the related tax regulations, the payment of his Disability Benefit shall begin
when he has a Separation from Service (as defined in Section 8.01) as a result
of his being disabled or, if he is a Specified Employee (as defined in Section
8.01), shall begin on his Delayed Payment Date (as defined in Section 8.01), and
the payment made on his Delayed Payment Date shall include all the payments
which would have

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been made on and after the date of his Separation from Service but for his
status as a Specified Employee.
     6.03 Employee Medical Benefit. The Company, at its expense, shall provide
Employee with an annual physical examination to be conducted by a physician or
physicians as determined by Employee subject to the reasonable approval of the
Company.
     6.04 Other Benefits. Employee shall be provided additional employee
benefits, in addition to those identified in Section 6.01 – 6.03, including,
without limitation, participation in the Company’s 401(k) plan with immediate
full vesting in the Company’s matching contributions beginning with any matching
contribution made for fiscal year 2008, health, accident and disability
insurance under the Company’s regular and ongoing plans, policies and programs
available, from time to time, to senior officers of the Company, in accordance
with the provisions of such plans, policies and programs governing eligibility
and participation; provided, however, that such benefits may be modified,
amended or rescinded by the Board subject to applicable law and the terms of
such plans. The Company shall also pay Employee’s initiation fee as well as
monthly membership dues at the Ashford Club, Atlanta, Georgia.
     6.05 Vacation. Employee shall be entitled to four (4) weeks paid vacation
and three (3) days of paid personal business time each year during the Term
hereof and any renewal hereof. Any vacation or personal business days not used
in any year shall be subject to forfeiture or accrual pursuant to the Company’s
then-current vacation policy.
     6.06 Paramount Provisions.
          (a) Notwithstanding anything in Sections 6.01 and 6.02 above or any
other provision of this Agreement to the contrary, if the Company has met all of
its obligations under this Agreement (and provided that such obligations are not
relieved in accordance with the terms hereof) with respect to obtaining and
maintaining in force (i) the life insurance policy described in Section 6.01
hereof on the life of Employee to fund the minimum death benefit or (ii) the
Supplemental Disability Policy maintained for Employee pursuant to Section 6.02
hereof to fund such Employee’s Disability Benefit, but all or any portion of the
proceeds under any such policy are not actually received by the Employee for any
reason whatsoever, including without limitation the insolvency of the insurer or
any misrepresentation made by Employee in the application for such insurance,
then the right of Employee or his designated beneficiary to receive a Disability
Benefit or a death benefit, as the case may be, shall be reduced (but not below
zero) by the amount by which the Disability Benefit or death benefit otherwise
payable exceeds the insurance proceeds actually received. The Company agrees
that any insurance company issuing the life insurance policy described in
Section 6.01 shall have at least an “A” rating by the Best Rating Service.
          (b) Anything in Sections 6.01, 6.02, 6.03, and 6.04 to the contrary
notwithstanding, the amount of the benefits provided for in Section 6 are
subject to adjustment as shall be provided for in the plan or insurance
contract, as the case may be, pursuant to which such benefit is being paid and
the Employee will be given written notice of any such change. Anything in this
Agreement to the contrary notwithstanding, the Board shall have full authority

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to make all determinations deemed necessary or advisable for the administration
of the benefits described in this Section 6. The good faith interpretation and
construction by the Board of the terms of this Section 6 or the benefit programs
described herein shall be final, conclusive and binding on Employee.
     7. Business Expenses.
     All reasonable and customary business expenses incurred by Employee in the
performance of his duties hereunder shall be paid or reimbursed by the Company
in accordance with the Company’s policies in effect, from time to time. The
amount of reasonable business expenses eligible for reimbursement in any taxable
year of Employee shall not affect the amount of reasonable business expenses
eligible for reimbursement in any other taxable year of Employee.
     8. Termination of Employment.
     8.01 Definitions. For purposes of this Agreement, the following terms shall
have the following meanings:
          The term “Cause” shall mean (i) Employee commits fraud or is convicted
of a crime involving moral turpitude, (ii) Employee, in carrying out his duties
hereunder, has been guilty of gross neglect or gross misconduct resulting in
harm to the Company or any of its subsidiaries or affiliates, (iii) Employee
shall have failed to materially comply with the policies of the Company or shall
have refused to follow or comply with the duly promulgated directives of the CEO
or the Board, (iv) Employee has breached any of the provisions of Sections 10.02
through and including 10.04 or (v) Employee otherwise materially breaches a
material term of this Agreement.
          The term “Code” shall mean the Internal Revenue Code of 1986 as
amended.
          The term “Constructive Discharge” shall mean a Separation from Service
by the Employee on account of a material diminution of or change in his
responsibilities or duties; provided, however, that no Separation from Service
by the Employee shall be considered a Constructive Discharge unless, within one
hundred eighty (180) days of the initial existence of such diminution or change
Employee has first provided written notice to the Company’s Chairman of the
Board of the factual circumstances forming the basis for the claim of
constructive discharge and of his intent to treat those circumstances as a
Constructive Discharge under this Agreement, and has further provided the
Company with a period of at least thirty (30) days in which to cure such alleged
breach.
          The term “Delayed Payment Date” shall mean the date that is six
(6) months and one (1) day after the date of Employee’s Separation from Service.
          The term “Disability” shall mean the good faith determination by the
CEO of the Company or the Board that Employee has failed to or has been unable
to perform his duties as the result of any physical or mental disability for a
period of ninety (90) consecutive days during any one period of Disability.

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          The term “Separation from Service” shall mean a “separation from
service” with the Company within the meaning of § 409A of the Code and the
related income tax regulations.
          The term “Specified Employee” shall mean a “specified employee” within
the meaning of § 409A of the Code and the related income tax regulations.
     8.02 Termination upon Death or Disability. If Employee has a Separation
from Service due to his death or Disability, the Company shall pay to the estate
of the Employee or to the Employee, as the case may be, within fifteen (15) days
following Employee’s death or upon his termination in the event of Disability,
all amounts then payable to Employee pro rated through the date of termination
pursuant to Section 3, and the amount of any accrued but unused vacation under
Section 6.05 for the year in which such termination occurs and any reimbursable
amounts owed Employee under Section 7. However, if the definition of a
Disability does not satisfy the requirements for a payment based on a
“disability” under § 409A of the Code and the related tax regulations, any
payments due hereunder shall begin when he has a Separation from Service as a
result of his being Disabled or, if he is a Specified Employee, shall begin on
his Delayed Payment Date, and the payment made on his Delayed Payment Date shall
include all the payments which would have been made on and after the date of his
Separation from Service but for his status as a Specified Employee. Finally, the
Company shall pay to Employee any Incentive Pay payable pursuant to Section 4.03
hereof. Such payment shall be made in a lump sum in cash at Employee’s
Separation from Service or, if Employee is a Specified Employee, on Employee’s
Delayed Payment Date.
     8.03 Termination by the Company without Cause or Employee’s Resignation for
a Constructive Discharge. The Company may terminate Employee’s employment under
this Agreement without Cause at any time, upon written notice to Employee. If
Employee has a Separation from Service as a result of a termination without
Cause (other than a Separation of Service described in Section 8.02) or as a
result of his resignation because he has experienced a Constructive Discharge or
as a result of the Company’s decision not to renew the Term pursuant to
Section 1, the Company shall pay or provide to Employee, in lieu of all other
amounts payable hereunder or benefits to be provided hereunder the following:
(a) a payment equal to the sum of (x) and (y) where (x) is two (2) times
Employee’s Base Salary at the time of termination, and (y) is two (2) times
Employee’s Target Incentive Pay for the year in which such termination occurs
(or, if no Target Incentive Pay has been designated for such year, then the
Target Incentive Pay for the last year in which it was designated prior to such
termination); and (b) the acceleration of any unvested rights of Employee under
any restricted stock, stock options (other than stock options for which the
performance criterion required for exercise has not been previously satisfied)
or other equity incentive awards such that they shall immediately vest under the
terms of such awards. As a condition precedent to the requirement of Company to
make such payment or grant such accelerated vesting, Employee shall not be in
breach of his obligations under Section 10 hereof and Employee shall execute and
deliver to Company a general release in favor of the Company in substantially
the same form as the general release then being used by the Company.

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     Any payment required to be made under this Section 8.03 shall be made to
Employee in a lump sum in cash on his Separation from Service or, if he is a
Specified Employee, on his Delayed Payment Date.
     8.04 Voluntary Termination by Employee or Termination for Cause. Employee
may resign his employment hereunder at any time whatsoever, with or without
cause, upon thirty (30) days prior written notice to the Company. The Company
may terminate Employee’s employment hereunder at any time without notice for
Cause. In the event Employee has a Separation from Service as a result of his
resignation (other than as a result of a Constructive Discharge) or as a result
of a termination by the Company for Cause:
          (a) The Company shall pay to Employee a lump sum in cash on his
Separation from Service or, if he is a Specified Employee, on his Delayed
Payment Date all amounts then due under Sections 3, 4 (but only to the extent of
earned but unpaid Incentive Pay), 6 and 7, prorated, through the date of
termination for the year in which he is terminated; and
          (b) The Company shall be under no obligation to make severance
payments to Employee or continue any benefits being provided to Employee beyond
the date of such termination other than benefits to which Employee may be
entitled as a result of Federal or state law.
     If Employee is terminated by the Company for Cause, Employee may within the
ten (10) business day period immediately following such termination request in
writing that the Chairman of the Board provide a written statement of the facts
supporting his termination for Cause, and Employee during the ten (10) business
day period immediately following the delivery of such statement may submit a
written petition to the Chairman of the Board that his employment be reinstated
with full pay retroactive to the date of his termination of employment. Any such
petition shall set forth his reason or reasons why there was no Cause for his
termination, and he may request that he be granted a meeting with the Board of
Directors so he (or Employee and his attorney) can present such reason or
reasons in person and answer any questions which any of the members of the Board
of Directors want to ask Employee. The Board of Directors will promptly act on
his petition, and the decision of the Board of Directors shall be final and
binding on the Company and on Employee.
     9. Change of Control, Change in Responsibilities.
     Upon the occurrence of both of the following events:
          (a) The dissolution or liquidation of the Company, or a
reorganization, merger or consolidation of the Company with one or more
corporations as a result of which the owners of all of the outstanding shares of
Stock immediately prior to such reorganization, merger or consolidation own in
the aggregate, directly and indirectly, less than 50% of the outstanding shares
of Stock of the Company or any other entity into which the Company shall be
merged or consolidated immediately following the consummation thereof, or the
sale, transfer or other disposition of all or substantially all of the assets or
more than 50% of the then outstanding

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shares of Stock of the Company in a single transaction or series of related
transactions (a “Change in Control”); and
          (b) Within one (1) year of such Change in Control there is a
termination of employment without Cause or (2) there is a material diminution of
or change in Employee’s responsibilities or duties, and Employee elects, in
writing, within ninety (90) days following the occurrence of such diminution or
change to resign effective thirty (30) days after the Company’s receipt of such
notice then, if Employee has a Separation from Service as a result of such
termination or resignation, he shall be deemed to have been terminated by the
Company other than for Cause and all amounts payable to Employee pursuant to
Section 8.03 shall become payable in a lump sum in cash on his Separation from
Service or, if he is a Specified Employee, on his Delayed Payment Date.
     A Change in Control of the Company shall not be deemed to occur by reason
of any public offering of the Stock of the Company.
     Except as expressly contemplated by this Agreement, or in any other
agreement referred to in Section 5 hereof, no merger, reorganization,
recapitalization, sale of stock, sale of assets or other change in the capital
structure of the Company or in the identity of the legal or beneficial owners of
the Company shall affect the rights or obligations of the Company or Employee
hereunder.
     10. Confidentiality and Non-Competition.
     10.01 Definitions. For purposes of this Section 10, the following terms
shall have the following meanings:
          “Affiliate” means any corporation, limited liability company,
partnership or other entity of which the Company owns at least fifty percent
(50%) of the outstanding equity and voting rights, directly or indirectly,
through any other corporation, limited liability company, partnership or other
entity.
          “Businesses” means the businesses engaged in by the Company directly
or through its Affiliates immediately prior to termination of employment.
          “Confidential Information” means information which does not rise to
the level of a Trade Secret, but is valuable to the Company or any Affiliate and
provided in confidence to Employee.
          “Proprietary Information” means, collectively, Trade Secrets and
Confidential Information.
          “Restricted Period” means the period commencing as of the date hereof
and ending on that date two years (2) year after the termination of Employee’s
employment with the Company for any reason, whether voluntary or involuntary.

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          “Trade Secrets” means information which derives economic value, actual
or potential, from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can obtain economic value
from its disclosure or use, and is the subject of efforts that are reasonable
under the circumstances to maintain its secrecy.
     10.02 Covenant Not-To-Disclose. The Company and Employee recognize that,
during the course of Employee’s employment with the Company, the Company has
disclosed and will continue to disclose to Employee Proprietary Information
concerning the Company and the Affiliates, their products, their franchisees,
their services and other matters concerning their Businesses, all of which
constitute valuable assets of the Company and the Affiliates. The Company and
Employee further acknowledge that the Company has, and will, invest considerable
amounts of time, effort and corporate resources in developing such valuable
assets and that disclosure by Employee of such assets to the public shall cause
irreparable harm, damage and loss to the Company and the Affiliates.
Accordingly, Employee acknowledges and agrees that, except as may be required by
law:
          (a) that the Proprietary Information is and shall remain the exclusive
property of the Company (or the applicable Affiliate);
          (b) to use the Proprietary Information exclusively for the purpose of
fulfilling the obligations under this Agreement;
          (c) to return the Proprietary Information, and any copies thereof, in
his possession or under his control, to the Company (or the applicable
Affiliate) upon request of the Company (or the Affiliate), or expiration or
termination of Employee’s employment hereunder for any reason; and
          (d) to hold the Proprietary Information in confidence and not copy,
publish or disclose to others or allow any other party to copy, publish or
disclose to others in any form, any Proprietary Information without the prior
written approval of an authorized representative of the Company.
     The obligations and restrictions set forth in this Section 10.02 shall
survive the expiration or termination of this Agreement, for any reason, and
shall remain in full force and effect as follows:
          (a) as to Trade Secrets, indefinitely, and
          (b) as to Confidential Information, for a period of two (2) years
after the expiration or termination of this Agreement for any reason.
     The confidentiality, property, and proprietary rights protections available
in this Agreement are in addition to, and not exclusive of, any and all other
corporate rights, including those provided under copyright, corporate officer or
director fiduciary duties, and trade secret and confidential information laws.
The obligations set forth in this Section 10.02 shall not apply or shall
terminate with respect to any particular portion of the Proprietary Information
which (i)

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was in Employee’s possession, free of any obligation of confidence, prior to his
receipt from the Company or its Affiliate, (ii) Employee establishes the
Proprietary Information is already in the public domain at the time the Company
or the Affiliate communicates it to Employee, or becomes available to the public
through no breach of this Agreement by Employee, or (iii) Employee establishes
that he received the Proprietary Information independently and in good faith
from a third party lawfully in possession thereof and having no obligation to
keep such information confidential.
     10.03 Covenant of Non-Disparagement and Cooperation. Employee agrees that
he shall not at any time during or following the Term of this Agreement make any
remarks disparaging the conduct or character of the Company or the Affiliates or
any of the Company’s or the Affiliates’ current or former agents, employees,
officers, directors, successors or assigns (collectively the “Related Parties”).
In addition, Employee agrees to cooperate with the Related Parties, at no extra
cost, in any litigation or administrative proceedings (e.g., EEOC charges)
involving any matters with which Employee was involved during Employee’s
employment with the Company. The Company shall reimburse Employee for reasonable
expenses incurred by Employee in providing such assistance.
     10.04 Covenant Not-To-Induce. Employee covenants and agrees that during the
Restricted Period, he will not, directly or indirectly, on his own behalf or in
the service or on behalf of others, hire, solicit, take away or attempt to hire,
solicit or take away any person who is or was an employee of the Company or any
Affiliate during the one (1) year period preceding the termination of Employee’s
employment.
     10.05 Remedies. The Company and Employee expressly agree that a violation
of any of the covenants contained in subsections 10.02 through and including
10.04 of this Section 10, or any provision thereof, shall cause irreparable
injury to the Company and that, accordingly, the Company shall be entitled, in
addition to any other rights and remedies it may have at law or in equity, to an
injunction enjoining and restraining Employee from doing or continuing to do any
such act and any other violation or threatened violation of said Sections 10.02
through and including 10.04 hereof.
     10.06 Severability. In the event any provision of this Agreement shall be
found to be void, the remaining provisions of this Agreement shall nevertheless
be binding with the same effect as though the void part were deleted; provided,
however, if Sections 10.02 through and including 10.04 of this Section 10 shall
be declared invalid, in whole or in part, Employee shall execute, as soon as
possible, a supplemental agreement with the Company, granting the Company, to
the extent legally possible, the protection afforded by said subsections. It is
expressly understood and agreed by the parties hereto that the Company shall not
be barred from enforcing the restrictive covenants contained in each of
subsections 10.02 through and including 10.04, as each are separate and
distinct, so that the invalidity of any one or more of said covenants shall not
affect the enforceability and validity of the other covenants.
     10.07 Ownership of Property. Employee agrees and acknowledges that all
works of authorship and inventions, including but not limited to products,
goods, know-how, Trade Secrets and Confidential Information, and any revisions
thereof, in any form and in whatever

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stage of creation or development, arising out of or resulting from, or in
connection with, the services provided by Employee to the Company or any
Affiliate under this Agreement are works made for hire and shall be the sole and
exclusive property of the Company or such Affiliate. Employee agrees to execute
such documents as the Company may reasonably request for the purpose of
effectuating the rights of the Company or the Affiliate in any such property.
     10.08 No Defense. The existence of any claim, demand, action or cause of
action of the Employee against the Company shall not constitute a defense to the
enforcement by the Company of any of the covenants or agreements in this
Section 10.
     11. Gross Up Payment. The term “Gross Up Payment” as used in this Agreement
shall mean a payment to or on behalf of Employee which shall be sufficient to
pay (1) 100% of any excise tax described in this Section 11, (2) 100% of any
federal, state and local income tax and social security and other employment tax
on the payment made to pay such excise tax as well as any additional taxes on
such payment and (3) 100% of any interest or penalties assessed by the Internal
Revenue Service on Employee which are related to the timely payment of such
excise tax (unless such interest or penalties are attributable to Employee’s
willful misconduct or gross negligence with respect to such timely payment). A
Gross Up Payment shall be made by the Company in a lump sum at the Company’s
option either directly to the United State Treasury or to Employee after either
the Company or the Company’s independent accountants determine that any payments
and benefits called for under this Agreement together with any other payments
and benefits made available to Employee by the Company and any other person will
result in Employee being subject to an excise tax under § 4999 of the Code or
such an excise tax is assessed against Employee as a result of any such payments
and other benefits if Employee takes such action (other than waiving Employee’s
right to any payments or benefits in excess of the payments or benefits which
Employee has expressly agreed to waive under this Section 11) as the Company
reasonably requests under the circumstances to mitigate or challenge such excise
tax; provided, however, if the Company or the Company’s independent accountants
make the determination described in this Section 11 and, further, determine that
Employee will not be subject to any such excise tax if Employee waives
Employee’s right to receive a part of such payments or benefits and such part
does not exceed $10,000, Employee shall irrevocably waive Employee’s right to
receive such part if an independent accountant or lawyer retained by Employee
and paid by the Company agrees with the determination made by the Company or the
Company’s independent accountants with respect to the effect of such reduction
in payments or benefits. Any determinations under this Section 11 shall be made
in accordance with § 280G of the Code and any applicable related regulations
(whether proposed, temporary or final) and any related Internal Revenue Service
rulings and any related case law and, if the Company reasonably requests that
Employee take action to mitigate or challenge, or to mitigate and challenge, any
such tax or assessment (other than waiving Employee’s right to any payments or
benefits in excess of the payments or benefits which Employee has expressly
agreed to waive under this Section 11 and Employee complies with such request,
the Company shall provide Employee with such information and such expert advice
and assistance from the Company’s independent accountants, lawyers and other
advisors as Employee may reasonably request and shall pay for all expenses
incurred in effecting such compliance and any related fines, penalties, interest
and other assessments.

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     12. Indemnification.
     12.01 Company Obligations. The Company hereby indemnifies and agrees to
hold harmless Employee, to the extent allowed by applicable law, against all
liabilities, obligations, claims, demands, actions, causes of action, lawsuits,
judgments, expenses and costs, including but not limited to the reasonable costs
of investigation and attorney’s fees, incurred by the Employee as a result of
any threat, demand, claim action or lawsuits, made, instituted or initiated
against the Employee, which arises out of, results from or relates to this
Agreement or any action taken by Employee in the course of performance of
Employee’s duties hereunder, except for Employee’s own gross negligence or
willful misconduct.
     12.02 Notice and Defense of Claim. If any claim suit or other legal
proceeding shall be commenced, or any claim or demand be asserted against the
Employee and Employee desires indemnification pursuant to this paragraph, the
Company shall be notified to such effect with reasonable promptness and shall
have the right to assume at its full cost and expense the entire control of any
legal proceeding, subject to the right of the Employee to participate at his
full cost and expense and with counsel of his choice in the defense, compromise
or settlement thereof. The Employee shall cooperate fully in all respects with
the Company in any such defense, compromise or settlement, including, without
limitation, making available to the Company all pertinent information under the
control of the Employee. The Company may compromise or settle any such action,
suit, proceeding, claim or demand without Employee’s approval so long as the
Company obtains for Employee’s benefit a release of liability with respect to
such claim from the claimant and the Company assumes and agrees to pay any
amounts due with respect to such settlement. In no event shall the Company be
liable for any settlement entered into by the Employee without the Company’s
prior written consent.
     12.03 Survival. The provisions of Sections 12.01 and 12.02 shall survive
the termination of this Agreement for a period of four (4) years, unless
Employee is terminated for Cause, in which event such provisions shall not
survive termination of this Agreement.
     12.04 Liability Insurance. The Company shall use commercially reasonable
efforts to obtain and maintain directors’ and officers’ liability insurance
covering the Employee to the same extent as the Company covers its other
officers and directors.
     13. Dispute Resolution.
     13.01 Agreement to Arbitrate. In consideration for his continued employment
with the Company, and other consideration, the sufficiency of which is hereby
acknowledged, Employee acknowledges and agrees that any controversy or claim
arising out of or relating to Employee’s employment, termination of employment,
or this Agreement including, but not limited to, controversies and claims that
are protected or covered by any federal, state, or local statute, regulation or
common law, shall be settled by arbitration pursuant to the Federal Arbitration
Act. This includes, but is not limited to, violations or alleged violations of
any federal or state statute or common law (including, but not limited to, the
laws of the United States or of any state, or the Constitution of the United
States or of any state), or of any other law, statute, ordinance, including but
not limited to, the Age Discrimination in Employment Act, Title VII of

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the Civil Rights Act of 1964, as amended, the Americans with Disabilities Act,
the Equal Pay Act, the Employee Retirement Income Security Act of 1972, as
amended, the Rehabilitation Act of 1973, and any other statute or common law.
This provision shall not, however, preclude the Company from seeking equitable
relief as provided in Section 10.06 of this Agreement.
     13.02 Procedure. The arbitration shall be conducted in accordance with the
Employment Arbitration Rules of the American Arbitration Association: a single
arbitrator who is experienced in employment law shall be selected under those
Rules, and the arbitration shall be initiated in Atlanta, Georgia, unless the
parties agree in writing to a different location or the Arbitrator directs the
arbitration to be held at a different location. Except for filing fees, all
costs of the arbitrator shall be allocated by the arbitrator. If the arbitrator
awards monetary relief to Employee, the arbitrator shall have the discretion to
award Employee’s attorney’s fees and costs if the arbitrator deems it
appropriate. The award rendered by the arbitrator shall be final and binding on
the parties hereto and judgment thereon may be entered in any court having
jurisdiction thereof. In addition to that provided for in the Employment
Arbitration Rules, the arbitrator has sole discretion to permit discovery
consistent with the Federal Rules of Civil Procedure and the judicial
interpretation of those rules upon request by any party; provided, however, it
is the intent of the parties that the arbitrator limit the time and scope of any
such discovery to the greatest extent practicable and provide a decision as
rapidly as possible given the circumstances of the claims to be determined. The
arbitrator also shall have the power and authority to grant injunctive relief
for any violation of Sections 10.02 through and including 10.04 and the
arbitrator’s order granting such relief may be entered in any court of competent
jurisdiction. The agreement to arbitrate any claim arising out of the employment
relationship or termination of employment shall not apply to those claims which
cannot be made subject to this provision by statute, regulation or common law.
These include, but are not limited to, any claims relating to work related
injuries and claims for unemployment benefits under applicable state laws.
     13.03 Rights of Parties. Nothing in this clause shall be construed to
prevent the Company from asking a court of competent jurisdiction to enter
appropriate equitable relief to enjoin any violation of this Agreement by
Employee. The Company shall have the right to seek such relief in connection
with or apart from the parties’ rights under this clause to arbitrate all
disputes. With respect to disputes arising under this Agreement that are
submitted to a court rather than an arbitrator, including actions to compel
arbitration or for equitable relief in aid of arbitration, the parties agree
that venue and jurisdiction are proper in any state or federal court lying
within Atlanta, Georgia and specifically consent to the jurisdiction and venue
of such court for the purpose of any proceedings contemplated by this paragraph.
By entering into this Agreement the parties have waived any right which may
exist for a trial by jury and have expressly agreed to resolve any disputes
covered by this Agreement through the arbitration process described herein.
     14. Employee Acknowledgment.
     By signing this Agreement, Employee acknowledges that the Company has
advised Employee of his right to consult with an attorney prior to executing
this Agreement; that he has the right to retain counsel of his own choosing
concerning the agreement to arbitrate or any

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waiver of rights or claims; that he has read and fully understands the terms of
this Agreement and/or has had the right to have it reviewed and approved by
counsel of choice, with adequate opportunity and time for such review; and that
he is fully aware of its contents and of its legal effect. Accordingly, this
Agreement shall not be construed against any party on the grounds that the party
drafted this Agreement. Instead, this Agreement shall be interpreted as though
drafted equally by all parties.
     15. Amendments.
     This Agreement may not be altered, modified or amended except by a written
instrument signed by each of the parties hereto.
     16. Successors.
     As used in this Agreement, the term the Company shall include any
successors to all or substantially all of the business and/or assets of the
Company which assumes and agrees to perform this Agreement.
     17. Assignment.
     Neither this Agreement nor any of the rights or obligations of either party
hereunder shall be assigned or delegated by any party hereto without the prior
written consent of the other party, except that the Company may without the
consent of Employee assign its rights and delegate its duties hereunder to any
successor to the business of the Company. In the event of the assignment by the
Company of its rights and the delegation of its duties to a successor to the
business of the Company and the assumption of such rights and obligations by
such successor, the Company shall, effective upon such assumption, be relieved
from any and all obligations whatsoever to Employee hereunder.
     18. Waiver.
     Waiver by any party hereto of any breach or default by any other party of
any of the terms of this Agreement shall not operate as a waiver of any other
breach or default, whether similar to or different from the breach or default
waived.
     19. Severability.
     In the event that any one or more of the provisions of this Agreement shall
be or become invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not be affected thereby.
     20. Survival.
     Notwithstanding anything herein to the contrary, the provisions of
Sections 6.06, 7, 8.03, 9, 10, 11, 12 and 13 shall survive the termination of
this Agreement.

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     21. Entire Terms.
     This Agreement contains the entire understanding of the parties with
respect to the employment of Employee by the Company. There are no restrictions,
agreements, promises, warranties, covenants or undertakings other than those
expressly set forth herein. This Agreement supersedes all prior agreements,
arrangements and understandings between the parties, whether oral or written,
with respect to the employment of Employee.
     22. Notices.
     Notices and all other communications provided for in this Agreement shall
be in writing and shall be deemed to have been duly given when personally
delivered or if mailed in the manner herein specified, five (5) days after
postmark of such mailing when mailed by United States registered mail, return
receipt requested, postage prepaid, addressed as follows:
If to Employee:
Harold M. Cohen
5555 Glenridge Connector NE
Suite 300
Atlanta, Georgia 30342
If to the Company to:
AFC Enterprises, Inc.
5555 Glenridge Connector NE
Suite 300
Atlanta, Georgia 30342
Attn: Chief Executive Officer
or to such other address or such other person as Employee or the Company shall
designate in writing in accordance with this Section 22 except that notices
regarding changes in notices shall be effective only upon receipt.
     23. Headings.
     Headings to Sections in this Agreement are for the convenience of the
parties only and are not intended to be a part of, or to affect the meaning or
interpretation of, this Agreement.
     24. Governing Laws.
     The Agreement shall be governed by the laws of the State of Georgia without
reference to the principles of conflict of laws.

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     25. Compliance with § 409A of the Code.
     To the extent this Agreement is subject to § 409A of the Code, the Company
and Employee intend all payments under this Agreement to comply with the
requirements of such section, and this Agreement shall, to the extent reasonably
practicable, be operated and administered to effectuate such intent

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     IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
and Employee has hereunto set his hand as of the day and year first above
written.

                  COMPANY:
 
                AFC ENTERPRISES, INC.
 
           
 
  By:   /s/ John M. Cranor, III
 
John M. Cranor, III    
 
      Chairman of the Board    
 
                EMPLOYEE:
 
                /s/ Harold M. Cohen                 Harold M. Cohen

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