**Exhibit 10.29**

 

 

November 19, 2004

 

Mr.William G. Shrader

11160E Gold Dust Ave

Scottsdale,Arizona  85259

 

DearBill,

 

Onbehalf of MAIN STREET RESTAURANT GROUP, INC (MSRG). I am pleased to summarizeyour compensation agreement as President and CEO.

 

The term of this agreement is two (2) yearscommencing on January 1, 2005 and ending on April 1, 2007. Your annual salary for2005 will be at an annual rate of $373,800 (payable bi-weekly in the normalpayroll practices of MSRG).  Compensationfor the year 2006 is to be increased by at least $10,000, or such higher amountdetermined and agreed to by the Compensation Committee of the Board ofDirectors.

 

Additionally, this agreement provides for you tocontinue your participation in the Company’s performance bonus, stock option andrestricted stock grant programs.

 

**BONUS**

 

Earned Bonus compensation is determined as apercentage of base compensation, measured by meeting EBITDA (Cash flow) Targetsas follows:

 

•                  30% bonusif Main Street meets last year’s EBITDA target

•                  45% bonusif Main Street meets Budgeted EBITDA target

•                  60% bonusmaximum if Main Street exceeds budgeted EBITDA by the difference of budgetedEBITDA and last year’s actual EBITDA

 

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By way of example only for the bonus computation, iflast year’s EBITDA is $10.0 million and the current year Budgeted EBITDA targetis $12.5 million, then the following bonus percentage would apply to the basecompensation if the actual EBITDA is as follows:

 
| $10.0 million |   | 30% |   | Achieving last year’s EBITDA |
|---------------|--------|-----|--------|-----------------------------------|
| $11.0 million |   | 36% |   | 1.0 m / 2.5 m times 15%           |
| $12.5 million |   | 45% |   | Achieving target EBITDA           |
| $13.0 million |   | 48% |   | .5 m / 2.5 m times 15%            |
| $15.5 million |   | 60% |   | Maximum % that can be earned      |

 

**STOCK OPTIONS OR RESTRICTED STOCK**

 

**Stock Options**

 

If MSRG continues with its current stock optionprogram, Mr. Shrader will be awarded 100,000 ten year options, vesting 1/3 atthe time of issuance, 1/3 after one year and the final 1/3 two years later. Theoption price for all options will be the market price on the date of approvaland grant by the compensation committee of the board of directors.

 

**RestrictedStock Grants**

 

If MSRG discontinues its stock option grant programand replaces it with a Restricted Stock Grant program, then Mr. Shrader will beentitled to receive 25,000 restricted shares each year at the same terms andconditions as set forth by the Compensation committee of the board.

 

**BENEFITS**

 

You will be eligible for the standard employeehealth and welfare package in addition to an annual, company-paid executivephysical and participation in the company’s 401(K) program.

 

**DEATH OR DISABILITY**

 

In the event of your death or permanent disability(as reasonably determined by Main Street) during the term of this agreement,Mr. Shrader will receive a continuation of his salary for (12) twelve months,payable monthly to his estate or designee. In addition he will be entitled tothe prorated bonus which would have accrued under this agreement.  It is expected that during 2005, the companywill evaluate life insurance benefit programs that would be expected to replacethis section.

 

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**SEVERANCE UPON TERMINATIONWITHOUT CAUSE**

 

If you are terminated without cause you will beeligible to receive (12) months of your base pay plus a prorated amount of yourannual bonus (if applicable) earned during your last year of active employment.

 

**CHANGE IN CONTROL**

 

In the event of a Change of Control (an event wherethe control of MSRG becomes vested in stockholders different than those whocontrol today), all non-vested stock options and/or restricted stock grants willbecome immediately vested.  In addition,at your option you will receive 24 months of your base salary, plus a proratedamount of your annual bonus earned for the portion of the year actually workedas severance, or the opportunity to accept, if offered, an equivalent positionand salary with the then new organization

 

Thiscontract supersedes any other promises, offers or previous contracts oragreements.

 

Bill,on behalf of the Company and Board of Directors I would like to congratulateyou on the progress you have made with the company in the short time you havebeen its CEO and wish you the best of luck in continuing this adventure withMain Street.  We believe that you havemade a substantial contribution to the organization and will direct the companyto achieving our present and future goals.

 
| Sincerely,                         |   |
|------------------------------------|--------|
|                               |   |
|                               |   |
| /s/ John F. Antioco                |   |   |
| John F. Antioco                    |   |
|                               |   |
| Chairman of Compensation Committee |   |
| Main Street Restaurant Group, Inc. |   |
| Board of Directors                 |   |
|                               |   |
| **AGREED TO AND ACKNOWLEDGED BY:** |   |
|                               |   |
|                               |   |
| /s/ William G. Shrader             |   | 1/25/05 |   |
|                               | Date   |

 

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