exv10w16






Exhibit 10.16




 






EXCHANGE AGREEMENT




dated as of October ____, 2010




by and among




BRAVO BRIO RESTAURANT GROUP, INC.,




BRAVO DEVELOPMENT HOLDINGS LLC




and



ALL OTHER SHAREHOLDERS OF BRAVO BRIO RESTAURANT GROUP, INC.




 











 









 








EXCHANGE AGREEMENT




          This is an Exchange Agreement (this “Agreement”) dated as of October __ 2010, by and
among Bravo Brio Restaurant Group, Inc., an Ohio corporation (the “Company”), Bravo
Development Holdings LLC, a Delaware limited liability company and majority shareholder of the
Company (“Holdings”), and all other shareholders of the Company (which shareholders are
listed on the signature pages hereto) (together with Holdings, the “Shareholders”).




RECITALS




          WHEREAS, the Company is contemplating an initial public offering (the “Offering”) of
its Common Shares, no par value per share (such shares, the “New Common Shares”), pursuant
to a registration statement on Form S-1 filed with the U.S. Securities and Exchange Commission (the
“Commission”) on July 1, 2010, as the same may be amended from time to time (the
“Registration Statement”);




          WHEREAS, as of the date hereof, the Shareholders constitute all the shareholders of the
Company and own of record the number of shares of the Company’s Common Stock, par value $.001 per
share (such shares, the “Existing Common Shares”), and shares of the Company’s Series A 14%
Cumulative Compounding Preferred Stock, par value $.001 per share (such shares, the “Existing
Preferred Shares”), as set forth opposite each of the Shareholders’ names on Exhibit A
hereto, which shares constitute as of the date hereof, and will constitute immediately prior to the
exchange transactions described below, all of the issued and outstanding Existing Common Shares and
Existing Preferred Shares;




          WHEREAS, in anticipation of the Offering, the parties hereto desire that, immediately prior to
the consummation of the Offering, (i) the Existing Common Shares will be exchanged for New Common
Shares in accordance with the terms hereof and (ii) immediately following the exchange of Existing
Common Shares for New Common Shares, the Existing Preferred Shares will be exchanged for New Common
Shares in accordance with the terms hereof;




          WHEREAS, immediately prior to the consummation of the exchange transactions described above,
the Company will adopt and file with the Secretary of State of the State of Ohio its Second Amended
and Restated Articles of Incorporation (the “New Articles of Incorporation”) reflecting the
Company’s new capital structure, including the authorization of the New Common Shares, and certain
other changes necessitated by the Offering;




          WHEREAS, it is contemplated that, immediately after the consummation of the exchange
transactions described above but immediately prior to the consummation of the Offering, Holdings
will effectuate (i) the dissolution of Holdings and (ii) the distribution of the New Common Shares
received by Holdings pursuant to the exchange transactions described above to its members in
proportion to their ownership of outstanding membership units of Holdings; and




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          WHEREAS, the above-referenced changes to the Company’s capital structure are intended to
constitute reorganizations pursuant to Section 368(a)(1) of the Internal Revenue Code of 1986, as
amended (the “Code”), and this Agreement is being entered into in connection with that
certain Agreement and Plan of Reorganization, dated as of the date hereof and attached as
Exhibit B hereto (the “Plan of Reorganization”), which shall be deemed to
constitute a “plan or reorganization” within the meaning of Code Section 368(a) and Treasury
Regulations Section 1.368-2(g).




          NOW, THEREFORE, in consideration of the premises and the mutual representations, warranties,
covenants, agreements and conditions herein contained, and intending to be legally bound, the
parties hereto agree as follows:




AGREEMENT




ARTICLE I



THE EXCHANGES



     1.1 Exchange of Existing Common Shares for New Common Shares.



          (a) At the Closing (as defined below), each Shareholder shall transfer and deliver to the
Company, free and clear of all liens, the number of Existing Common Shares held by such Shareholder
set forth opposite such Shareholder’s name in the second column of Exhibit A hereto, and,
in exchange therefor, the Company shall issue to such Shareholder the number of New Common Shares
set forth opposite such Shareholder’s name in the fourth column
of Exhibit A (such
exchange, the “Common Shares Exchange”). The number of New Common Shares set forth
opposite each such Shareholder’s name in the fourth column of Exhibit A was derived by
multiplying (i) the number of Existing Common Shares to be transferred and delivered by each such
Shareholder by (ii) 6.8898763, rounded to a whole share. The Existing Common Shares so
exchanged shall be deemed to be cancelled without further action of the Company.




          (b) Prior to or at the Closing, each Shareholder shall surrender to the Company all stock
certificates evidencing Existing Common Shares owned by such Shareholder, free and clear of any
lien, claim or encumbrance, duly endorsed for transfer or accompanied by stock powers or
assignments duly executed with all necessary stock transfer stamps attached thereto. The
obligation of each party to close the Common Shares Exchange shall be conditioned on the
simultaneous closing by all the other parties to the Common Shares Exchange.




     1.2 Exchange of Existing Preferred Shares for New Common Shares.



          (a) Prior to the consummation of the Offering and immediately subsequent to the Common Shares
Exchange, at the Closing, each Shareholder shall transfer and deliver to the Company, free and
clear of liens, the number of Existing Preferred Shares held by such Shareholder set forth opposite
such Shareholder’s name in the third column of Exhibit A hereto,






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and, in exchange therefor, the Company shall issue to such Shareholder the number of New
Common Shares set forth opposite such Shareholder’s name in the
fifth column of Exhibit A (such exchange, the “Preferred Shares Exchange”). The number of New Common Shares set
forth opposite each such Shareholder’s name in the fifth column of Exhibit A was derived by
multiplying (i) the number of Existing Preferred Shares to be transferred and delivered by each
such Shareholder by (ii) 117.90974568263, rounded to a whole share. The Existing Preferred
Shares so exchanged shall be deemed to be cancelled without further action of the Company.




          (b) Prior to or at the Closing, each Shareholder shall surrender all stock certificates
evidencing Existing Preferred Shares owned by such Shareholder, free and clear of any lien, claim
or encumbrance, duly endorsed for transfer or accompanied by stock powers or assignments duly
executed with all necessary stock transfer stamps attached thereto. The obligation of each party
to close the Preferred Shares Exchange shall be conditioned on the simultaneous closing by all the
other parties to the Preferred Shares Exchange.




     1.3 Restrictive Legends. It is understood and agreed that the certificates evidencing
the shares of New Common Shares to be delivered at the Closing, and each certificate issued upon
transfer thereof, shall bear the following legend, in addition to any other legends required by
Ohio law:




THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY BE
OFFERED AND SOLD ONLY IF SO REGISTERED OR IN A MANNER EXEMPT FROM
REGISTRATION UNDER SUCH ACT.



     1.4 Transfer Taxes. The Company will assume and pay all transfer taxes (but not
income, franchise or other taxes measured by receipts or income) which are payable in connection
with the execution, delivery and performance of this Agreement or the authorization and issuance of
or exchange for New Common Shares hereunder or in connection with any modification of this
Agreement. Each Shareholder will cooperate with the Company to obtain a refund of any such taxes
from governmental authorities, if applicable.



ARTICLE II




THE CLOSING



     2.1 Closing.



          (a) Unless this Agreement shall have been earlier terminated in accordance with the terms of
this Agreement, the closing of the Preferred Shares Exchange shall take place on the date of but
immediately prior to the consummation of the Offering and the closing of the Common Shares Exchange
shall occur, without any action on the part of any party hereto, on the date of but immediately
prior to the closing of the Preferred Shares Exchange and simultaneously with the moment upon which
the New Articles of Incorporation filed with the Secretary of State






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of the State of Ohio shall become effective (together, the “Closing”). The Closing
shall take place at the offices of the Company, 777 Goodale Blvd., Suite 100, Columbus, Ohio 43212.
The date of the Closing is referred to herein as the “Closing Date.”




          (b) All obligations of the parties under this Agreement are subject to the condition precedent
that, concurrently with the closing of the Common Shares Exchange, the New Articles of
Incorporation shall have been filed with the Secretary of State of the State of Ohio and shall have
become effective.




ARTICLE III




REPRESENTATIONS AND WARRANTIES



     3.1 Representations and Warranties of the Company. The Company hereby represents and
warrants to the Shareholders, as of the date hereof and as of the Closing, as set forth below:



          (a) Existence, Qualification and Authority. The Company is a corporation duly
organized, validly existing and in good standing under the laws of Ohio. The Company has all
requisite power and authority to execute, deliver and perform this Agreement and to consummate the
transactions contemplated hereby. The execution, delivery and performance by the Company of this
Agreement have been duly authorized by all necessary action. This Agreement has been duly executed
and delivered by the Company and constitutes the legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms, except to the extent such
enforcement may be limited by applicable bankruptcy laws and other similar laws affecting
creditors’ rights generally.




          (b) New Common Shares. The New Common Shares to be issued to the Shareholders
pursuant to this Agreement will be, when issued, (i) duly authorized, validly issued, fully paid
and nonassessable, (ii) free and clear of all liens, encumbrances, equities and claims (other than
securities law restrictions and restrictions under that certain (x) New Investors Securities
Holders Agreement, dated as of June 29, 2006, by and among the Company, Holdings and the other
investors and parties named therein (the “New Investors Securities Holders Agreement”) and
(y) Securities Holders Agreement, dated as of June 29, 2006, by and among the Company, Holdings,
Alton F. Doody III, John C. Doody and the other investors and parties named therein (the
“Securities Holders Agreement”)) and (iii) issued without violation of any preemptive
rights.




     3.2 Representations and Warranties of the Shareholders. Each Shareholder, severally
and not jointly, hereby represents and warrants to the Company, as of the date hereof and as of the
Closing, as set forth below:



          (a) Existence, Qualification and Authority.




               (i) In respect of Holdings, Holdings is a limited liability company, duly organized, validly
existing and in good standing under the laws of Delaware. The



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execution, delivery and performance by Holdings of this Agreement have been duly authorized by
all necessary action. Holdings has the requisite power, authority and legal right to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.




               (ii) In respect of each Shareholder, other than Holdings, such Shareholder has the legal
capacity to execute and deliver this Agreement and to consummate the transactions contemplated
hereby.



               (iii) This Agreement has been duly executed and delivered by such Shareholder and constitutes
the legal, valid and binding obligation of such Shareholder, enforceable against such Shareholder
in accordance with its terms, except to the extent such enforcement may be limited by applicable
bankruptcy laws and other similar laws affecting creditors’ rights generally.



          (b) Existing Common Shares and Existing Preferred Shares. Such Shareholder owns of
record 100% of the Existing Common Shares and Existing Preferred Shares set forth opposite such
Shareholder’s name on Exhibit A hereto, free and clear of any lien, claim or encumbrance,
and, other than (x) the New Investors Securities Holders Agreement, (y) that certain Registration
Rights Agreement, dated as of June 29, 2006, by and among the Company, Holdings and the other
investors named therein and (z) the Securities Holders Agreement, as of the date hereof, there are
no, and immediately prior to the Closing there will be no, shareholder agreements, voting trusts,
proxies or other agreements or understandings with respect to the outstanding shares of capital
stock of the Company to which such Shareholder is a party.




          (c) Provisions Relating to Securities Laws. Such Shareholder acknowledges that the
shares of New Common Shares received pursuant to the Common Shares Exchange and/or the Preferred
Shares Exchange, as the case may be, have not been registered under the Securities Act of 1933, as
amended (the “Securities Act”), or under any applicable state securities laws, and are
being issued in reliance on exemptions from the registration requirements of the Securities Act and
any applicable state securities or blue sky laws. Each Shareholder agrees to refrain from
transferring or otherwise disposing of the New Common Shares (other than, in the case of Holdings,
to its members) or any interest therein in such manner as to cause the Company to violate the
registration requirements of the Securities Act or any applicable state securities or blue sky
laws.




ARTICLE IV




OTHER MATTERS



     4.1 Termination. Anything herein or elsewhere to the contrary notwithstanding, this
Agreement may be terminated (and the transactions contemplated herein may be abandoned) at any time
before the Closing (a) by mutual written consent of Holdings, on the one hand, and the Company, on
the other hand or (b) by Holdings, on the one hand, or the Company, on the other hand, upon notice
given to the other, if any governmental authority shall have issued an order, decree or ruling or
taken any other action permanently restraining, enjoining or otherwise



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prohibiting the transactions contemplated by this Agreement. In the event of any termination
of this Agreement as provided in this Section 4.1, (i) written notice thereof shall promptly be
given to the other parties hereto and this Agreement shall forthwith become wholly void and
terminate and of no further force and effect except for this Section 4.1 (Termination) and Sections
4.3 (Further Assurances; Lock-up), 4.5 (Assignment and Binding Effect), 4.6 (Amendment and Waiver),
4.7 (Notices), 4.8 (Applicable Law; Consent to Jurisdiction), 4.9 (No Benefit to Others), 4.10
(Headings), 4.11 (Severability), 4.12 (Counterparts) and 4.13 (Independent Nature of Obligations
and Rights), and (ii) there shall be no liability on the part of any of the parties hereto, except
that such termination shall not preclude any party from pursuing judicial remedies for damages
and/or other relief as a result of the breach by the other party of any representation, warranty,
covenant or agreement contained herein prior to such termination.




     4.2 Termination of Agreements. The Company and the Shareholders party to the New
Investors Securities Holders Agreement and/or the Securities Holders Agreement agree that,
effective as of the Closing, such agreements automatically shall be terminated in their entirety,
shall be null and void and shall no longer be in full force and effect and that all rights and
obligations thereunder shall cease upon the Closing.



     4.3 Further Assurances. Each of the parties shall from time to time after the Closing
Date, at the reasonable request of any other party, execute, acknowledge and deliver to such other
party such other instruments of conveyance and transfer or assumption and will take such other
actions and execute and deliver such other documents, certifications and further assurances as such
other party may reasonably require in order to effect the transactions contemplated hereby and will
use commercially reasonable efforts to cooperate with the other parties and execute and deliver to
the other parties such other instruments and documents and take such other actions as may be
reasonably requested from time to time by such other party as necessary to carry out, evidence and
confirm the intended purposes of this Agreement.



     4.4 Contents of Agreement. This Agreement, including the Exhibits hereto, and, with
respect to the Company and Holdings only, the Plan of Reorganization, sets forth the entire
understanding of the parties hereto with respect to the transactions contemplated hereby and
supersedes any and all previous agreements and understandings, oral or written, between or among
the parties regarding the transactions contemplated hereby. The transactions contemplated hereby
constitute a reclassification within the meaning of Rule 16b-7 promulgated under the Securities
Exchange Act of 1934, as amended.



     4.5 Assignment and Binding Effect. This Agreement may not be assigned by any party
without the prior written consent of the other parties. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each party.



     4.6 Amendment and Waiver. Except for as expressly set forth herein, this Agreement
shall not be amended or modified, and no provision hereof shall be waived, except by written
instrument duly executed by each of the parties hereto. The grant of a waiver in one instance does
not constitute a continuing waiver in all similar instances. No failure to exercise, and no



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delay in exercising, by any party, any right, remedy, power or privilege hereunder shall
operate as a waiver thereof.




     4.7 Notices. Any notice, request, demand, waiver, consent, approval or other
communication which is required or permitted hereunder shall be in writing and shall be deemed
given only if delivered personally, delivered by courier or sent by registered or certified mail or
by Federal Express or other overnight mail service, postage prepaid, or by facsimile, with written
confirmation to follow, as follows:


If to the Company, to:



Bravo Brio Restaurant Group, Inc.

777 Goodale Blvd.

Suite 100

Columbus, Ohio 43212

Attention: Chief Executive Officer

Facsimile No.: (614) 326-7943



With a required copy to (which shall not itself constitute notice):



Dechert LLP

Cira Centre

2929 Arch Street

Philadelphia, PA 19104

Attention: Carmen J. Romano, Esq. and James A. Lebovitz, Esq.

Facsimile No.: (215) 994-2222



If to Holdings:



c/o Bruckmann, Rosser, Sherrill & Co., Inc.

126 East 56th Street, 29th Floor

New York, NY 10022

Attention: Harold O. Rosser, II

Facsimile No.: (212) 521-3799



With a required copy to (which shall not itself constitute notice):



Bruckmann, Rosser, Sherrill & Co., Inc.

126 East 56th Street, 29th Floor

New York, NY 10022

Attention: Harold O. Rosser, II

Facsimile No.: (212) 521-3799



Castle Harlan, Inc.

150 East 58th Street




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New York, NY 10155

Attention: David B. Pittaway

Facsimile No.: (212) 593-5955



Dechert LLP

Cira Centre

2929 Arch Street

Philadelphia, PA 19104

Attention: Carmen J. Romano, Esq. and James A. Lebovitz, Esq.

Facsimile No.: (215) 994-2222




          If to any other Shareholder, to such Shareholder’s address as set forth in the records of the
Company,



or to such other address or facsimile numbers as the addressee may have specified in a notice duly
given to the sender as provided herein. Such notice, request, demand, waiver, consent, approval or
other communication will be deemed to have been given as of the date so delivered or, if such date
is not a business day, on the next business day.




     4.8 Applicable Law; Consent to Jurisdiction. This Agreement shall be governed by and
construed in accordance with the laws of the State of Ohio, without giving effect to such State’s
laws and principles regarding the conflict of laws. Each of the parties hereto (a) consents to
submit itself to the personal jurisdiction of any federal court located in the State of Ohio or any
Ohio state court in connection with any dispute that arises out of this Agreement or any of the
transactions contemplated by this Agreement, (b) agrees that it will not attempt to deny or defeat
such personal jurisdiction by motion or other request for leave from any such court, (c) agrees
that it will not bring any action relating to this Agreement or any of the transactions
contemplated by this Agreement in any court other than a federal court sitting in the State of Ohio
or an Ohio state court unless venue would not be proper under rules applicable in such courts and
(d) waives any right to which it may be entitled, on account of place of residence or domicile.



     4.9 No Benefit to Others. The representations, warranties, covenants and agreements
contained in this Agreement are for the sole benefit of the parties hereto and their respective
heirs, executors, administrators, legal representatives, successors and permitted assigns, and they
shall not be construed as conferring any rights on any other persons.



     4.10 Headings. The headings in this Agreement are solely for convenience of reference
and shall not limit or otherwise affect the meaning of this Agreement.



     4.11 Severability. Any provision of this Agreement which is invalid or unenforceable
in any jurisdiction shall be ineffective to the extent of such invalidity or unenforceability
without invalidating or rendering unenforceable the remaining provisions hereof, and such
invalidity or unenforceability in any jurisdiction shall not invalidate or render unenforceable
such provisions in any other jurisdiction.



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     4.12 Counterparts. This Agreement may be executed in any number of counterparts and
any party hereto may execute any such counterpart, each of which when executed and delivered shall
be deemed to be an original and all of which counterparts taken together shall constitute but one
and the same instrument. This Agreement shall only become binding when one or more counterparts
taken together shall have been executed and delivered by all of the parties.



     4.13 Independent Nature of Obligations and Rights. The obligations of each Shareholder
under this Agreement are several and not joint with the obligations of each other party, and no
Shareholder shall be responsible in any way for the performance of the obligations of any other
party under this Agreement.



     4.14 Remedies. Each party to this Agreement acknowledges and agrees that in the event
of any breach of this Agreement by such party, any of the other parties hereto would be irreparably
harmed and could not be made whole by monetary damages. Each party accordingly agrees (i) to waive
the defense in any action for specific performance that a remedy at law would be adequate and (ii)
any of the other parties hereto, in addition to any other remedy to which it may be entitled at law
or in equity, shall be entitled to compel specific performance of this Agreement.



[Signature Pages Follow]




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          IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of the date first
written above.




	 	 	 	 	 
	 	BRAVO BRIO RESTAURANT GROUP, INC.

 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	SHAREHOLDERS


BRAVO DEVELOPMENT HOLDINGS LLC

 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



	 	 	 

	 

	 	 
	 

	 	Alton F. Doody, III
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Saed Mohseni
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	James J. O’Connor






[Signature Page to Exchange Agreement]




 









 





	 	 	 

	 

	 	 
	 

	 	Bret Adams
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Kathleen L. Chugh
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Mike Creedon
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Ronald F. Dee
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	John C. Doody
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Alice Elliot
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Gary Ertl
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Vernessa W. Gates
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Matt Harding
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Joe Isbell






[Signature Page to Exchange Agreement]




 









 





	 	 	 

	 

	 	 
	 

	 	Lance Juhas
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Timothy M. Kenrick
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Michael L. Moser
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Brian T. O’Malley
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	John Odachowski
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Jeff Ramm
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Diane Reed
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Lou Rios
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Nicole Roope
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Justin Stratford





[Signature Page to Exchange Agreement]



 









 






	 	 	 

	 

	 	 
	 

	 	Laura Tappen
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Debbie Ticknor
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Tom Vahle
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Mike Woodburn
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Philip S. Yandolino






[Signature Page to Exchange Agreement]