Muscle Maker, Inc

Employment Agreement

 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into effective
as of the Effective Date (as defined below), by and between Michael J. Roper
(“Employee”) and Muscle Maker, Inc, a California corporation (the “Company”).
The Employee and the Company are sometimes referred to herein, each individually
as a “Party” or collectively as the “Parties”.

 

WHEREAS, the Company desires to (i) continue to employ Employee as Chief
Executive Officer of the Company, and the Employee desires to continue to serve
in such capacities on behalf of the Company, on the terms and conditions set
forth in this Agreement.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties agree as follows:

 

Section 1. Position and Duties.

 

1.1 During the Initial Employment Term (as defined below), the Employee shall
serve as the Chief Executive Officer of the Company and shall report solely and
directly to the Board. The Employee shall be responsible for oversight and
management of all operations and activities of the Company. In addition, the
Employee shall perform all other duties and accept all other responsibilities
incident to such position as may be reasonably assigned to him by the Board.

 

1.2 During the Initial Employment Term, Employee shall serve the Company
faithfully and to the best of his ability and shall devote substantially all of
his business time, attention and efforts to the performance of such duties as
may be assigned to him from time to time by the Board. Employee shall confer
with the Board and must have the written approval prior to any mergers,
acquisitions or significant contracts by the company or prior to entering into
any new financial agreements on behalf of the company outside of his normal day
to day responsibilities.

 

1.3 Employee expressly represents and warrants to the Company that Employee is
not a party to any contract or agreement and is not otherwise obligated in any
way, and is not subject to any rules or regulations, whether governmentally
imposed or otherwise, which will or may restrict in any way the Employee’s
ability to fully perform his duties and responsibilities under this Agreement.
Employee further expressly represents and warrants that he is eligible to work
in the United States and shall take all necessary action to comply with requests
for verification of employment eligibility.

 

1.4 Employee will perform his duties and responsibilities located at the
corporate headquarters or elsewhere within reason to perform the position’s
responsibilities.

 

1.5 To the extent Employee is asked to serve as an officer, director or manager
of the subsidiaries (“Subsidiaries”) of the Company (such as Muscle Maker
Development, LLC and Muscle Maker Corp., LLC), Employee’s duties to the
Subsidiaries shall be deemed to have been included in this Agreement, shall not
be entitled to any additional compensation hereunder, and shall be covered by
all provisions of the Agreement mutatis mutandis.

 

Section 2. Term. Employee shall be employed by the Company (the “Initial
Employment Term”) under this Agreement commencing as of the date signed below
(“Effective Date”), and for a period of one (1) year, subject to earlier
termination or extension as provided herein. The term of this Agreement may be
extended by mutual written agreement between the Parties. If the Parties agree
to any such extension, the Parties shall specify the terms and conditions of the
Employee’s continuing employment, and the provisions of this Agreement that
applied during the Initial Term shall not apply during any extension period
except as explicitly provided under this Agreement or by the Parties in
connection with the extension.

 

1

 

 

Section 3. Compensation and Benefits.

 

3.1 Base Salary. Commencing on the Effective Date, the Company shall pay
Employee during the Initial Employment Term an annual salary of $250,000, less
ordinary withholdings (the “Annual Salary”). Such Annual Salary will be payable
less ordinary withholdings in accordance with the normal payroll cycle as
presently exists (currently weekly) or may hereafter be adopted by the Company.

 

3.2 Bonus. As additional compensation and as further consideration for Employee
entering into this Agreement for services to be rendered by Employee, the
Company may pay Employee annually following the end of each fiscal year, a cash
bonus. The Company’s Board, together with the Compensation Committee of the
Company’s Board, will review Employee’s performance and may award Employee
performance-based compensation (“Bonus”) in its sole discretion, if deemed
warranted. Any such Bonus may be in cash or in securities of the Company, or any
combination thereof, and shall be subject to such timing of receipt, vesting and
any other conditions (including but not limited to conditions which may extend
beyond the termination of this contract) as imposed by the Board at the time of
such grant and at the time of adoption of any plan under which such Bonus may be
granted, if any.

 

3.3 Equity Awards. Employee shall receive restricted stock in the amount of
100,000 shares of the Company’s common stock upon his Employment with the
Company, details of the restricted stock to be agreed up and completed within 30
days of the effective date of this agreement. Additional stock rewards may be
approved by the Board of Directors together with the Compensation Committee from
time to time.

 

3.4 Employee Benefits. Effective as of the Effective Date and during the Initial
Employment Term, Employee shall be eligible for employee benefits available to
regular full-time executive management employees of the Company provided that
Employee meets the eligibility requirements for such benefits. The Company
provides no assurance as to the adoption or continuance of any particular
employee benefit plan or program; and Employee’s participation in any such plan
or program shall be subject to the provisions, rules, conditions, exclusions,
regulations and plan documents or policies applicable thereto. The Company
remains free to change the terms of any benefit plan in its sole discretion with
or without notice.

 

3.5 Vacation. Employee shall be entitled to accrue paid vacation at the rate of
two (2) weeks per year. Upon separation, all accrued but not yet used vacation
days will be paid in one lump sum in a final paycheck.

 

3.6 Holidays. Employee shall receive five (5) personal time off days and six (6)
paid Company holidays.

 

3.7 Reimbursement of Expenses. Employee shall be entitled to reimbursement of
reasonable expenses incurred by Employee in the course of Employee’s duties, in
accordance with applicable policies and documentation requirements of the
Company. This will include but not limited to travel to the Company’s Houston
office and other business-related trips.

 

2

 

 

3.8 Relocation. In the event that the Company requires Employee to relocate a
relocation package will be provided up to an amount not to exceed twenty-five
thousand dollars ($25,000).

 

3.9 Technology. A laptop or desktop computer will be issued to the Employee for
Company use. A reimbursement for cell phone usage up to two hundred dollars
($200) per month and a home internet connection up to fifty dollars ($50) per
month will be granted.

 

3.10 Tax Withholding. Notwithstanding anything in this Agreement to the
contrary, the Company may withhold from any amounts payable or benefits provided
under this Agreement all federal, state, city, or other taxes as are legally
required to be withheld.

 

Section 4. Termination.

 

4.1 Termination by Company for Cause. The Company may terminate Employee’s
employment for Cause immediately upon written notice stating the basis for such
termination. If Employee is terminated for Cause, he shall be entitled to
receive all earned but unpaid compensation, bonuses (not subject to a pro-rate
adjustment), and benefits through the date of termination by the Company for
Cause. A termination of Employee by the Company for “Cause” occurs if Employee
is terminated for any of the following reasons:

 

(i) Employee’s refusal to comply with a lawful instruction of the Company’s
Board of Directors;

 

(ii) Any act or omission knowingly undertaken or omitted by Employee without a
reasonable belief that such action was in the best interests of the Company, its
properties, assets or business or its officers, directors or employees, as
determined by the Board in its commercially reasonable discretion (including
disparagement of the Company);

 

(iii) Theft, dishonesty or intentional falsification of any employment or
Company records;

 

(iv) Any fraud or embezzlement involving properties, assets or funds of the
Company;

 

(v) A material breach of this Agreement if Employee fails to cure such breach
within thirty (30) days after written notice from the Company specifying the
action which constitutes the breach and demanding its discontinuance;

 

(vi) Negligence in performing his duties, which has been brought to Employee’s
attention in writing, and which (if curable) has not been cured within thirty
(30) days of the notice thereof;

 

(vii) Intentional and improper disclosure of the Company’s confidential or
proprietary information;

 

(viii) Employee’s conviction (including any plea of guilty or nolo contendere)
to any criminal offense which constitutes a felony, or is punishable by more
than one year in jail, in the jurisdiction where the conviction or plea
occurred; or

 

(ix) Employee’s commission of an act of discrimination or harassment based on
race, sex, national origin, religious, disability, age or other protected
classification in the state where the act occurs.

 

3

 

 

4.2 Termination upon Death or Disability. This Agreement shall automatically
terminate upon the death or disability of Employee unless employees’ death
occurs while on Company business in which event the employees’ estate will
receive all compensation and benefits through the date of death or disability.
For purposes of this Agreement, the term “disability” shall mean the inability
of Employee to perform with or without reasonable accommodation, the essential
functions of his job duties due to physical or mental disablement which
continues for a period of ninety (90) consecutive days during any six (6) month
period, as determined by an independent qualified physician mutually acceptable
to Employee and the Company. Notwithstanding the foregoing, nothing in this
Agreement shall alleviate any legal responsibility of the Company to provide
reasonable accommodations to Employee as may be required by applicable law.

 

4.3 Termination by Employee with Good Reason or by Company Without Cause. This
Employment Agreement and Employee’s employment with the Company may be
terminated by Employee for good reason (“Good Reason”), or by the Company
without cause (“Without Cause”), upon prior providing thirty (30) days written
notice to the Company (which notice describes such good reason with reasonable
detail) or Employee, respectively. The Company shall pay Employee all earned but
unpaid compensation, bonuses and benefits through the date of termination by
Employee with Good Reason or by the Company Without Cause as well as continue to
pay Employee the per month rate of salary then in effect and provide Employee
with benefits (unless the terms of the applicable benefit plans expressly
prohibit the continuation of such benefits after such termination) for the
balance of the Initial Employment Term that would have remained hereunder had
such termination not occurred. Good Reason shall mean the occurrence of any one
or more of the following events provided Employee has notified the Company in
writing of the occurrence of such event and the event has continued uncured for
thirty (30) days after the Company’s receipt of such notice, unless Employee
specifically agrees in writing that such event shall not be Good Reason:

 

  (i) Any material breach of this Employment Agreement by the Company; or      
  (ii) the failure of the Company to assign this Employment Agreement to a
successor to the Company or the failure of a successor to explicitly assume and
agree to be bound by this Employment Agreement or a similar Employment
Agreement.

 

4.4 Termination by Employee Without Cause. Employee may terminate this
Employment Agreement and his employment with the Company Without Cause upon
providing thirty (30) days prior written notice to the Company. The Company
shall pay Employee all earned but unpaid compensation, bonuses (not subject to a
pro-rate adjustment), and benefits through the date of termination Without Cause
by Employee. The Company shall have no further obligation to pay compensation or
benefits to Employee for the remainder of the balance of the Initial Employment
Term.

 

4.5 Return of Property. Employee agrees, upon the termination of his employment
with the Company, to return all physical, computerized, electronic or other
types of records, documents, proposals, notes, lists, files and any and all
other materials including, without limitation, computerized and/or electronic
information that refers, relates or otherwise pertains to the Company and/or its
affiliates, and any and all business dealings of said persons and entities. In
addition, Employee shall return to the Company all property or equipment that
Employee has been issued during the course of his employment or which he
otherwise currently possesses, including, but not limited to, any computers,
cellular phones, and/or similar items. Employee shall immediately deliver to the
Company any such physical, computerized, electronic or other types of records,
documents, proposals, notes, lists, files, materials, property and equipment
that are in Employee’s possession. Employee acknowledges that Employee is not
authorized to retain any physical, computerized, electronic or other types of
copies of any such physical, computerized, electronic or other types of records,
documents, proposals, notes, lists, files or materials, and is not authorized to
retain any other property or equipment of the Company and/or its affiliates.
Employee further agrees that he will immediately forward to the Company any
business information regarding the Company and/or any of its affiliates that has
been or is inadvertently directed to Employee following Employee’s last day of
employment with the Company. The provisions of this Section are in addition to
any other written agreements on this subject that Employee may have with the
Company and/or any of its affiliates, and are not meant to and do not excuse any
additional obligations that Employee may have under such agreements.

 

4

 

 

Section 5. Miscellaneous Provisions.

 

5.1 Confidentiality. At all times Employee both during and after employment will
regard and preserve as confidential all trade secrets and other confidential
information pertaining to the business of the Company, including financial data,
strategic business plans, product development, marketing plans, and other
non-public proprietary information.

 

5.2 Non-Competition and Non-Solicitation. For a period commencing on the date of
Employment with the Company and ending on the one year anniversary of the last
day payment is received from the Company, without prior written consent of the
Company, Employee shall not, directly or indirectly, as a principal, manager,
agent, consultant, or other similar role solicit or hire any employees of the
Company and/or its affiliates.

 

5.3 Assignment by Employee. This Agreement may not be assigned by Employee in
whole or in part; provided, however, if Employee should die or become disabled
while any amount is owed but unpaid to him hereunder, all such amounts, unless
otherwise provided herein, shall be paid to his devisees, legatees, legal
guardian or other designees.

 

5.4 Assignment by Employer. Employee hereby acknowledges and agrees that the
Company may, in its sole discretion assign this Agreement to a comparable
affiliate, successor, assign (including any direct or indirect successor by
purchase, merger, consolidation or otherwise to all or substantially all of the
assets or business of the Company). This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective spouses, heirs
and personal and legal representatives. Any such successor or assign of the
Company shall be included in the term “Company” as used in this Agreement

 

5.5 Notices. Any notice required to be delivered hereunder shall be in writing
and shall be addressed as follows:

 

If to the Company, to:

2200 Space Park Drive, Suite 310

Houston, TX 77058

Attention: Chairman of the Board

 

If to Employee:

2205 Mockingbird Lane

Flower Mound, TX 75022

Attention: Michael J. Roper

 

5

 

 

or, in each case, to such other address as such party may hereafter specify for
the purpose by written notice to the other party hereto. Any such notice shall
be deemed received on the date of receipt by the recipient thereof if received
prior to 5:00 p.m. in the place of receipt and such day is a business day in the
place of receipt. Otherwise, any such notice shall be deemed not to have been
received until the next succeeding business day in the place of receipt.

 

5.6 Entire Agreement. This Agreement represents the entire agreement between
Employee and the Company and its affiliates with respect to Employee’s
employment, and supersedes all prior discussions, negotiations, and agreements,
written or oral. 

 

5.7 Waiver of Rights. The waiver by either party of a breach of any provision of
this Agreement shall not operate or be construed as a continuing waiver or as a
consent to or waiver of any subsequent breach hereof.

 

5.8 Severability. In the event any provision of the Agreement shall be held
illegal or invalid for any reason, the illegality or invalidity shall not affect
the remaining parts of the Agreement, and the Agreement shall be construed and
enforced as if the illegal or invalid provision had not been included.

 

5.9 Governing Law; Venue. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas without reference to principles
of conflict of laws. Any action at law, suit in equity or judicial proceeding
arising directly, indirectly, or otherwise in connection with, out of, related
to or from this Agreement, or any provision hereof, shall be litigated only in
the courts of the State of Texas.

 

5.10 Counterparts. This Agreement may be signed in several counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were on the same instrument.

 

5.11 Employee Counsel. Employee acknowledges that he has had the opportunity to
review this Agreement and the transactions contemplated hereby with his own
legal counsel.

 

6

 

 

IN WITNESS WHEREOF, the Company and Employee have executed this Employment
Agreement effective as of the date first set forth above.

 

  COMPANY: Muscle Maker, Inc             By: /s/ Kevin Mohan       Kevin Mohan-
Interim President             Date: 5/1/18           EMPLOYEE:                
By: /s/ Michael J. Roper       Michael J. Roper             Date: 5/1/18

 

7