Document:

ex-10_1.htm

 

FedFirst Financial Corporation 8-K

 

Exhibit 10.1

CHANGE IN CONTROL

SEVERANCE AGREEMENT

THIS CHANGE IN CONTROL SEVERANCE AGREEMENT (the “Agreement”) is entered into as of OCTOBER 14, 2011, by and between FIRST FEDERAL SAVINGS BANK (the “Bank”) and JAMIE L. PRAH (the “Executive”) and FEDFIRST FINANCIAL
CORPORATION, the holding company for the Bank (the “Company”), as guarantor.

WHEREAS, the Executive has made significant contributions to the success of the Bank and the Company; and

WHEREAS, the Bank and the Company wish to provide additional incentives for the Executive to remain in the employment of the Bank and the Company.

NOW THEREFORE, in consideration of these premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows.

1.           Termination after a Change in Control.

(a)           Cash benefit. Notwithstanding any other provisions in this Agreement, if the Executive’s employment terminates involuntarily but without Cause or voluntarily but with Good Reason, in either case within 12 months after a Change in Control, the Bank shall make a lump-sum cash payment to the Executive in an amount equal to three (3) times the Executive’s base salary (at the rate in effect immediately prior to the Change in
Control or, if higher, the rate in effect when the Executive terminates employment).  Unless a delay in payment is required under Section 1(b) of this Agreement, the payment required under this Section 1(a) shall be made within five (5) business days after the Executive’s employment termination.

The amount payable to the Executive hereunder shall not be reduced to account for the time value of money or discounted to present value. If the Executive’s employment terminates involuntarily but without Cause before the Change in Control occurs but after discussions regarding the Change in Control commence, then for purposes of this Agreement the Executive’s employment shall be deemed to have terminated immediately after the Change in Control and, unless delay is required under Section 1(b) of this Agreement, the Executive shall be entitled to the cash benefit under this Section 1(a) within five (5) business days after the Change in
Control.

If, following a Change in Control, the Executive is offered a “Comparable Position” by the acquirer and the Executive declines the position, the Executive will not be entitled to any benefits under this Agreement.  For purposes of this Agreement, a “Comparable Position” shall mean a position that would:

(i) provide the Executive with a base salary and health insurance coverage substantially comparable in the aggregate to that provided to the Executive prior to the Change in Control,

(ii) be in a location that would not require the Executive to increase his one way commute by more than twenty-five (25) miles from his home as of the Change in Control, and

 

  

  

  

 

(iii) have job skill requirements and duties that are substantially comparable to the requirements and duties of the position held by the Executive prior to the Change in Control.

(b)            Payment of the benefit. If the Executive is a “specified employee” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) as of his termination of employment and the cash severance benefit under Section 1(a) of this Agreement is considered deferred compensation under Section 409A of the Code and an exemption from the six-month delay requirement for specified employees under Section 409A(a)(2)(B)(i) of the Code is not available, payment of the benefit under Section 1(a) of this
Agreement shall be delayed and shall be made to the Executive in a single lump sum without interest on the first business day of the seventh (7th) month after the month in which the Executive’s employment terminates.

(c)           Change in Control defined.

 

For purposes of this Agreement, a “Change in Control” means and shall be deemed to have occurred upon the occurrence of any of the following events:

 

	 	
(i) 

	
Merger: The Company merges into or consolidates with another corporation, or merges another corporation into the Company, and as a result, less than a majority of the combined voting power of the resulting corporation immediately after the merger or consolidation is held by persons who were stockholders of the Company immediately before the merger or consolidation.

	 	
(ii)

	
Acquisition of Significant Share Ownership: There is filed, or required to be filed, a report on Schedule 13D or another form or schedule (other than Schedule 13G) required under Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, if the schedule discloses that the filing person or persons acting in concert has or have become the beneficial owner(s) of 25% or more of a class of the Company’s voting securities, but this clause
(ii) shall not apply to beneficial ownership of Company voting shares held in a fiduciary capacity by an entity of which the Company directly or indirectly beneficially owns 50% or more of its outstanding voting securities.

	
  

	
(iii)

	
Change in Board Composition: During any period of two consecutive years, individuals who constitute the Company’s Board of Directors at the beginning of the two-year period cease for any reason to constitute at least a majority of the Company’s Board of Directors; provided, however, that for purposes of this clause (iii), each director who is first elected by the board (or first nominated by the board for election by the stockholders) by a vote of at least two-thirds (2/3) of the directors who were directors
at the beginning of the two-year period shall be deemed to have also been a director at the beginning of such period; or

	
  

	
(iv)

	
Sale of Assets: The Company sells to a third party all or substantially all of its assets.

(d)            Involuntary termination with Cause defined. For purposes of this Agreement involuntary termination of the Executive’s employment shall be considered involuntary termination with Cause if the Executive shall have been terminated for any of the following reasons:

 

	 	
(i) 

	
Executive’s personal dishonesty;

	 	
(ii) 

	
Executive’s incompetence;

 

  

  

  

 

	 	
(iii) 

	
Executive’s willful misconduct;

	 	
(iv)

	
Executive’s breach of fiduciary duty involving personal profit;

	 	
(v) 

	
Executive’s intentional failure to perform the duties and responsibilities of his position with the Company and the Bank; or

	 	
(vi)

	
Executive’s willful violation of any law, rule or regulation (other than traffic violations or similar offenses) that reflects adversely on the reputation of the Bank or the Company, any felony conviction, any violation of law involving moral turpitude, or any violation of a final cease-and-desist order.

For purposes of this Agreement, no act or failure to act on the Executive’s part shall be deemed to have been intentional if it was due primarily to an error in judgment or negligence. An act or failure to act on the Executive’s part shall be considered intentional if it is not in good faith and if it is without a reasonable belief that the action or failure to act is in the Bank’s best interests. Any act or failure to act based upon authority granted by resolutions duly adopted by the board of directors or based upon the advice of counsel for the Bank shall be conclusively presumed to be in good faith and in the Bank’s best interests.

(e)            Voluntary termination with Good Reason defined. For purposes of this Agreement a voluntary termination by the Executive shall be considered a voluntary termination with Good Reason if the conditions stated in both clauses (i) and (ii) of this paragraph (e) are satisfied.

(i)          a voluntary termination by the Executive shall be considered a voluntary termination with Good Reason if any of the following occur without the Executive’s advance written consent, and the term Good Reason shall mean the occurrence of any of the following without the Executive’s advance written consent.

	 	
(A) 

	
a material diminution of the Executive’s base salary,

	 	
(B)

	
a material diminution of the Executive’s authority, duties, or responsibilities, or

	 	
(C) 

	
a change by more than twenty-five (25) miles in the geographic location at which the Executive must perform services which would result in a longer commute in terms of miles for the Executive.

(ii)          the Executive must give notice to the Bank of the existence of one or more of the conditions described in clause (i) within sixty (60) days after the initial existence of the condition, and the Bank shall have thirty (30) days thereafter to remedy the condition. In addition, the Executive’s voluntary termination because of the existence of one or more of the conditions described in clause (i) must occur within six months after the initial existence of the condition.

2.           Continuation of Benefits.

(a)            Benefits. Subject to Section 2(b) of this Agreement, if the Executive’s employment terminates involuntarily but without Cause, or voluntarily but for Good Reason within twelve (12) months after a Change in Control, the Bank shall continue or cause to be continued life and health insurance coverage substantially identical to the coverage maintained for the Executive before termination and in accordance with the same schedule prevailing before employment termination. The insurance coverage shall cease thirty-six (36) months after the
Executive’s termination.

 

  

  

  

 

 (b)           Alternative lump-sum cash payment. If (x) under the terms of the applicable policy or policies for the insurance benefits specified in Section 2(a) of this Agreement it is not possible to continue the Executive’s coverage, or (y) if when employment termination occurs the Executive is a specified employee within the meaning of Section 409A of
the Code, if any of the continued insurance coverage benefits specified in Section 2(a) of this Agreement would be considered deferred compensation under Section 409A of the Code, and finally if an exemption from the six-month delay requirement of Section 409A(a)(2)(B)(i) of the Code is not available for that particular insurance benefit, instead of continued insurance coverage under Section 2(a) of this Agreement, the Bank shall pay or cause to be paid to the Executive in a single lump sum an amount in cash equal to the present value of the Bank’s projected cost to maintain that particular insurance benefit had the Executive’s employment not terminated, assuming continued coverage for thirty-six (36) months. The lump-sum payment shall be made within five (5) business days after employment termination or, if the Executive is a specified employee within the meaning of Section
409A of the Code and an exemption from the six-month delay requirement for specified employees under Section 409A(a)(2)(B)(i) of the Code is not available, on the first business day of the seventh month after the month in which the Executive’s employment terminates.

3.           Termination for Which No Benefits Are Payable. Despite anything in this Agreement to the contrary, the Executive shall be entitled to no benefits under this Agreement if the Executive’s employment terminates with Cause, if the Executive dies while actively employed by the Bank, or if the Executive becomes totally disabled while actively employed by the Bank.
For purposes of this Agreement, the term “totally disabled” means that because of injury or sickness the Executive is unable to perform the Executive’s duties. The benefits, if any, payable to the Executive or the Executive’s beneficiary or estate relating to the Executive’s death or disability shall be determined solely by such benefit plans or arrangements as the Bank may have with the Executive relating to death or disability, not by this Agreement.

4.           Term of Agreement.

(a)            The term of this Agreement shall include: (i) the initial term, consisting of the period commencing on the date of this Agreement and ending September 30, 2013, plus (ii) any and all extensions of the initial term made pursuant to this Section 4.

(b)            Commencing on September 30, 2012 (the “Renewal Date”) and continuing on each anniversary of the Renewal Date thereafter, the disinterested members of the Boards of Directors may extend the term of this Agreement for an additional year, unless Executive elects not to extend the term of this Agreement by giving proper written notice.  The Board of Directors will review the Agreement and Executive’s performance annually for purposes of determining whether to extend the Agreement term and will include the rationale and results of its review in the minutes of the meetings.  The Board of Directors will
notify Executive as soon as possible after each annual review whether it has determined to extend the Agreement.

(c)            Notwithstanding the foregoing, in the event the Executive terminates employment with the Company and the Bank prior to a Change in Control, this Agreement will terminate as of the effective date of the Executive’s termination of employment.

  

  

  

5.           Limitation of Benefits Under Certain Circumstances.  If the payments and benefits pursuant to Sections 1 and 2 of this Agreement, either alone or together with other payments and benefits the Executive has the right to receive from the Bank, would constitute a “parachute payment” under Section 280G of the Code, the payments and benefits shall
be reduced or revised, in the manner determined by the Executive, by the amount, if any, which is the minimum necessary to result in no portion of the payments and benefits being non-deductible pursuant to Section 280G of the Code and subject to the excise tax imposed under Section 4999 of the code.  The Bank’s independent public accountants will determine any reduction in the payments and benefits; the Bank will pay for the accountants’ opinion.  If the Bank and/or the Executive do not agree with the accountants’ opinion, the Bank will pay to the Executive the maximum amount of payments and benefits pursuant to Sections 1 and 2 of this Agreement, as selected by Executive, that the opinion indicates have a high probability of not causing any of the payments and benefits to be non-deductible and subject to the excise tax imposed under Section 4999 of
the Code.  The Bank may also request, and the Executive has the right to demand that, a ruling from the IRS as to whether the disputed payments and benefits have such tax consequences.  The Bank will promptly prepare and file the request for a ruling from the IRS, but in no event will the Bank make this filing later than thirty (30) days from the date of the accountant’s opinion referred to above.  The request will be subject to the Executive’s approval prior to filing; the Executive shall not unreasonably withhold her approval.  The Bank and the Executive agree to be bound by any ruling received from the IRS and to make appropriate payments to each other to reflect any IRS rulings, together with interest at the applicable federal rate provided for in Section 7872(f)(2) of the Code.  Nothing contained in this Agreement shall
result in a reduction of any payments or benefits to which the Executive may be entitled upon termination of employment other than pursuant to Sections 1 and 2 hereof, or a reduction in the payments and benefits specified below zero.

6.           This Agreement Is Not an Employment Contract. The parties hereto acknowledge and agree that (x) this Agreement is not a management or employment agreement and (y) nothing in this Agreement shall give the Executive any rights or impose any obligations to
continued employment by the Bank or any subsidiary or successor of the Bank.

7.           Withholding of Taxes.  The Bank may withhold from any benefits payable under this Agreement all Federal, state, local or other taxes as may be required by law, governmental regulation, or ruling.

8.           Successors and Assigns.

(a)            This Agreement shall be binding upon the Bank and any successor to the Bank, including any persons acquiring directly or indirectly all or substantially all of the business or assets of the Bank by purchase, merger, consolidation, reorganization, or otherwise. But this Agreement and the Bank’s obligations under this Agreement are not otherwise assignable, transferable, or delegable by the Bank. By agreement in form and substance satisfactory to the Executive, the Bank shall require any successor to all or substantially all of the business or assets of the Bank expressly to assume and agree to perform this Agreement in the same manner
and to the same extent the Bank would be required to perform had no succession occurred.

(b)            This Agreement shall inure to the benefit of and be enforceable by the Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributees, and legatees.

(c)            This Agreement is personal in nature. Without written consent of the other party, neither party shall assign, transfer, or delegate this Agreement or any rights or obligations under this Agreement except as expressly provided in this Section 8. Without limiting the generality of the foregoing, the Executive’s right to receive payments hereunder is not assignable or transferable, whether by pledge, creation of a security interest, or otherwise, except for a transfer by Executive’s will or by the laws of descent and distribution. If the Executive attempts an assignment or transfer that is contrary to this Section 8, the Bank
shall have no liability to pay any amount to the assignee or transferee.

 

  

  

  

 

9.           Notices. Any notice under this Agreement shall be deemed to have been effectively made or given if in writing and personally delivered, delivered by mail properly addressed in a sealed envelope, postage prepaid by certified or registered mail, delivered by a reputable overnight delivery service, or sent by facsimile. Unless otherwise changed by notice, notice shall
be properly addressed to the Executive if addressed to the address of the Executive on the books and records of the Bank at the time of the delivery of the notice, and properly addressed to the Bank if addressed to the board of directors at the Bank’s executive offices.

10.           Captions and Counterparts. The headings and subheadings in this Agreement are included solely for convenience and shall not affect the interpretation of this Agreement. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same agreement.

11.           Amendments and Waivers. No provision of this Agreement may be modified, waived, or discharged unless the waiver, modification, or discharge is agreed to in a writing signed by the Executive and by the Bank. No waiver by either party hereto at any time of any breach by the other party hereto or waiver of compliance with any condition or provision of this Agreement
to be performed by the other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

12.           Severability. The provisions of this Agreement are severable. The invalidity or unenforceability of any provision shall not affect the validity or enforceability of the other provisions of this Agreement. Any provision held to be invalid or unenforceable shall be reformed to the extent and solely to the extent necessary to make it valid and enforceable.

13.           Governing Law, Jurisdiction and Forum. This Agreement shall be construed under and governed by the internal laws of the Commonwealth of Pennsylvania, without giving effect to any conflict of laws provision or rule that would cause the application of the laws of any jurisdiction other than Pennsylvania.  By entering into this Agreement, the Executive
acknowledges that the Executive is subject to the jurisdiction of both the federal and state courts in Pennsylvania.

14.           Entire Agreement. This Agreement constitutes the entire agreement between the Bank, the Company and the Executive concerning the subject matter. No rights are granted to the Executive under this Agreement other than those specifically set forth. No agreements or representations, oral or otherwise, expressed or implied concerning the subject matter hereof have been
made by either party that are not set forth expressly in this Agreement.

15.           No Mitigation Required.  The Executive shall not be required to mitigate the amount of any payment provided for in this Agreement by seeking other employment or otherwise, nor shall any profits, income, earnings, or other benefits from any source whatsoever create any mitigation, offset, reduction, or any other obligation on the part of the Executive
hereunder or otherwise.

16.           Internal Revenue Code Section 409A.  The Bank, the Company and the Executive intend that their exercise of authority or discretion under this Agreement shall comply with Section 409A of the Code.  If any provision of this Agreement does not satisfy the requirements of Section 409A of the Code, the provision shall be applied in a manner
consistent with those requirements, despite any contrary provision of this Agreement. If any provision of this Agreement would subject the Executive to additional tax or interest under Section 409A of the Code, the Bank shall reform the provision. However, the Bank shall maintain to the maximum extent practicable the original intent of the applicable provision without subjecting the Executive to additional tax or interest, and the Bank shall not be required to incur any additional compensation expense as a result of the reformed provision. References in this Agreement to Section 409A of the Code include rules, regulations, and guidance of general application issued by the Department of the Treasury under Section 409A of the Code.

 

  

  

  

 

17.           Source of Payments. All payments provided in this Agreement shall be timely paid in cash or check from the general funds of the Bank.  The Company, however, unconditionally guarantees payment and
provision of all amounts and benefits due hereunder to Executive and, if such amounts and benefits due from the Bank are not timely paid or provided by the Bank, such amounts and benefits shall be paid or provided by the Company.

IN WITNESS WHEREOF, the parties have executed this Change in Control Severance Agreement as of the date first written above.

 

	 	FIRST FEDERAL SAVINGS BANK	 
	 	 	 
	 	/s/ Patrick G. O’Brien	 
	 	Duly Authorized Officer	 
	 	 	 
	 	 	 
	 	 	 
	 	/s/ Jamie L. Prah	 
	 	
Jamie L. Prah

	 
	 	 	 
	 	 	 
	 	 	 
	 	
FEDFIRST FINANCIAL CORPORATION

(as guarantor)

	 
	 	 	 
	 	 	 
	 	/s/ Patrick G. O’Brien	 
	 	Duly Authorized Officerex10-3.htm

Exhibit 10.3

 

SECOND AMENDMENT TO ASSET PURCHASE AGREEMENT

This Second Amendment to Asset Purchase Agreement (this “Agreement”) dated August 31, 2011, to be effective (except as provided below) as of August 12, 2011 (the “Effective Date”), is by and among Petron Energy Special Corp. (formerly Petron Energy II, Inc.), a Nevada corporation (the “Seller”), Restaurant Concepts of America Inc., a Nevada corporation
(“Purchaser”), and Floyd L. Smith, an individual (“Seller Representative”), each a “Party” and collectively the “Parties.”

 

	
W I T N E S S E T H:

WHEREAS, the Parties previously entered into an Asset Purchase Agreement on August 12, 2011, pursuant to which Seller agreed to sell substantially all of its assets to Purchaser (the “Asset Purchase Agreement”), a copy of which is attached hereto as Exhibit A;

WHEREAS, the Parties previously entered into the First Amendment to Asset Purchase Agreement on August 15, 2011, pursuant to which the Parties modified and amended certain terms of the Asset Purchase Agreement, a copy of which is attached hereto as Exhibit B (the “First Amendment”);

WHEREAS, this Agreement shall not amend or modify any terms and conditions of the First Amendment, which shall stay in full force and effect following the Parties’ entry into this Agreement;

WHEREAS, capitalized terms used herein, but not otherwise defined shall have the meanings ascribed to such terms in the Asset Purchase Agreement, unless the context requires otherwise;

WHEREAS, the Parties desire to amend, modify and add certain terms and conditions to the Asset Purchase Agreement (“Modifications and Amendments”); and

WHEREAS, the Parties desire to enter into this Agreement to affect the Modifications and Amendments to, the Asset Purchase Agreement, as set forth below pursuant to the terms and conditions of this Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual covenants, agreements, and considerations herein contained, and other consideration, which consideration the Parties hereby acknowledge and confirm the sufficiency thereof, the Parties hereto agree as follows:

  

  

  

1. Amendments and Modifications to Asset Purchase Agreement.

(a) The Parties agree to amend and modify the Asset Purchase Agreement to provide for the acquisition by the Purchaser of all of Seller’s right, title and interest in the equipment of Seller as set forth in greater detail on Exhibit A to the Asset Purchase Agreement (under the heading “The following Lease Equipment”) and the last page of Exhibit C to the Asset Purchase Agreement
(under the heading “Equipment”)(collectively the “Equipment”)  prior to the date of the Closing (“Equipment Purchase”) as follows:

(i) The acquisition of the Equipment by the Purchaser shall occur immediately upon the Parties’ entry into this Agreement for aggregate consideration of 30,000 shares of the Purchaser’s restricted common stock (the “Equipment Shares”), which shall be issued to Purchaser concurrently with the Parties entry into this Agreement.

(ii) The issuance of the Equipment Shares in consideration for the Equipment shall reduce the total Common Stock Shares due at the Closing of the acquisition of the remaining Assets to be purchased pursuant to the Asset Purchase Agreement and payable to the Seller at the Closing of the Asset Purchase Agreement to 170,000 shares of restricted common stock.

(iii) The Equipment Purchase shall be treated for all purposes as a partial closing of the Asset Purchase Agreement, effective as of the date of the Parties’ entry into this Agreement, only as to the Equipment.

(iv) Notwithstanding the effectiveness of the Equipment Purchase, upon the Parties’ entry into this Agreement, the Seller agrees and hereby re-confirms and re-acknowledges the representations made by the Seller in the Asset Purchase Agreement relating to (a) the Common Stock Shares (including, but not limited to those representations made in Section 4.19 of the Asset Purchase Agreement)(treating the Equipment Shares for all purposes as Common Stock Shares for the purposes of such reconfirmations and acknowledgements); and (b) Seller’s ownership of, rights to and ability to sell
and transfer the Equipment (which for purposes of the Asset Purchase Agreement were included in the definition of Assets as used throughout such agreement).

(v) Regardless of whether the Closing of the sale of the remaining Assets occurs pursuant to the terms and conditions of the Asset Purchase Agreement, the Equipment Purchase shall be considered final and effective as of the Parties’ entry into this Agreement.  In the event the Closing of the remaining Assets set forth in the Asset Purchase Agreement does not occur, the Asset Purchase Agreement and the representations and warranties made therein shall remain in full force and effect, effective only as to the Equipment Purchase.

  

  

  

(b) Notwithstanding the fact that the Closing has not yet occurred, and in partial consideration for the Equipment Purchase, the Purchaser hereby assumes all rights, liabilities and obligations under and the Seller hereby assigns all of its rights, liabilities and obligations under that certain:

(i) Management Services Agreement between Seller and ASL Energy Corp., dated August 8, 2011, a copy of which is attached hereto as Exhibit C; and

 

 

(ii) Asset Acquisition Agreement between Seller and ONE Energy Capital Corp., ONE Energy International Corp. and their affiliated parties, dated August 8, 2011, a copy of which is attached hereto as Exhibit D (collectively Section 1(b)(i) and (ii), the “Assumed Agreements”).

(iii) Effective upon the Parties entry into this Agreement, the Assumed Agreements shall be considered assumed by and assigned to Purchaser for any and all purposes and any and all references therein to Seller shall automatically be modified to refer to Purchaser (the “Assumption”).

(iv) Seller shall have no further rights, obligations or liabilities under the Assumed Agreements (except as otherwise specifically set forth therein) following the effectiveness of the Assumption.

(c) Section 2.4 of the Asset Purchase Agreement is hereby amended and restated in its entirety by the following Section 2.4, which shall supersede and replace Section 2.4 of Asset Purchase Agreement and Section 2.4(b) of the Asset Purchase Agreement as amended by the First Amendment in their entirety:

 “2.4        Purchase Price.  In consideration ofor the purchase of the Assets, the Purchaser shall issue Seller an aggregate of:

(a) 200,000 restricted shares of the Purchaser’s common stock (the “Common Stock Shares”), of which 30,000 shares of common stock shall be issued in connection with the acquisition of Seller’s equipment by the Purchaser, pursuant to that certain Second Amendment to Asset Purchase Agreement dated August 31, 2011 (collectively the “Purchaser Stock” or the
“Purchase Price”).”

 

(d) For the sake of clarity and in an abundance of caution, Section 2.4(b) of the Asset Purchase Agreement, as amended by the First Amendment, shall be removed in its entirety from the Asset Purchase Agreement.

 

(e) Section 2.9 of the Asset Purchase Agreement, as added to the Asset Purchase Agreement by the First Amendment is hereby amended and restated in its entirety by the following Section 2.9:

 “2.9           Employment Agreement.  A required term and condition of the Closing shall be the entry by the Purchaser into an Executive Employment Agreement with Floyd L. Smith (the “Employment Agreement”), pursuant to which Mr. Smith shall serve as President of the Company for a term of five years; be paid $200,000 per year in consideration; be granted stock options to purchase up to 120,000 shares of the Company’s common stock at an exercise price of $.39 per share (the
“Options”, and such document evidencing the Options, the “Option Agreement”); and be issued 1,000 shares (representing all such shares) of a class of Preferred Stock (the “Preferred Stock”), which shall provide Floyd L. Smith the right, voting in aggregate and as a class, to vote 51% of the Purchaser’s outstanding voting shares on any and all shareholder matters; and shall include such other terms and conditions as the Seller may request, including, but not limited to the requirement that in the event Mr. Smith dies or becomes disabled within the first 18 months following the issuance of the shares
of Preferred Stock to Mr. Smith; ASL Energy Corp. and or its assigns (with whom the Purchaser is required to enter into a Services Agreement as provided below as part of the Closing) shall have the right with 61 days prior notice to transfer the ownership of and/or the rights associated with such shares to ASL (the “Assignment Rights”).”

  

  

  

(f) The Deadline as defined in Section 3.1 of the Asset Purchase Agreement shall be amended and shall require that the Closing occur prior to October 15, 2011, as mutually agreed to be extended by the Parties from time to time.

2. Consideration.  Each of the Parties agrees and confirms by signing below that they have received valid consideration in connection with this Agreement and the transactions contemplated herein.

 

 

3. Mutual Representations, Covenants and Warranties.  Each of the Parties, for themselves and for the benefit of each of the other Parties hereto, represents, covenants and warranties that:

(a)           Such Party has all requisite power and authority, corporate or otherwise, to execute and deliver this Agreement and to consummate the transactions contemplated hereby and thereby. This Agreement constitutes the legal, valid and binding obligation of such Party enforceable against such Party in accordance with its terms, except as such enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and general equitable principles; and

(b)           The execution and delivery by such Party and the consummation of the transactions contemplated hereby and thereby do not and shall not, by the lapse of time, the giving of notice or otherwise: (i) constitute a violation of any law; or (ii) constitute a breach of any provision contained in, or a default under, any governmental approval, any writ, injunction, order, judgment or decree of any governmental authority or any contract to which such Party is bound or affected.

 

 

  

  

  

4. Further Assurances.  The Parties agree that, from time to time, each of them will take such other action and to execute, acknowledge and deliver such contracts, deeds, or other documents as may be reasonably requested and necessary or appropriate to carry out the purposes and intent of this Agreement and the transactions contemplated herein.

5. Reconfirmation of Asset Purchase Agreement. Each Party hereby reaffirms all terms, conditions, covenants, representations and warranties made by such Party in the Asset Purchase Agreement, to the extent the same are not amended or modified hereby.

 

6. Effect of Agreement. Upon the effectiveness of this Agreement, each reference in the Asset Purchase Agreement to “Agreement,” “hereunder,” “hereof,”
“herein” or words of like import shall mean and be a reference to such Asset Purchase Agreement as modified or waived hereby.

 

7. Asset Purchase Agreement to Continue in Full Force and Effect.  Except as specifically modified or amended herein, the Asset Purchase Agreement and the terms and conditions thereof shall remain in full force and effect.

8. Benefit and Burden.  This Agreement shall inure to the benefit of, and shall be binding upon, the Parties hereto and their successors and permitted assigns.

9. Severability.  Should any clause, sentence, paragraph, subsection, Section or Article of this Agreement be judicially declared to be invalid, unenforceable or void, such decision will not have the effect of invalidating or voiding the remainder of this Agreement, and the Parties agree that the part or parts of this Agreement so held to be invalid, unenforceable or void will be deemed to have been stricken herefrom by the Parties, and the remainder will have the same force and effectiveness as if
such stricken part or parts had never been included herein.

10. Entire Agreement.  This Agreement sets forth all of the promises, agreements, conditions, understandings, warranties and representations among the Parties with respect to the transactions contemplated hereby and thereby, and supersedes all prior agreements, arrangements and understandings between the Parties, whether written, oral or otherwise.

11. Construction.  In this Agreement words importing the singular number include the plural and vice versa; words importing the masculine gender include the feminine and neuter genders.

12. Effect of Facsimile and Photocopied Signatures. This Agreement may be executed in several counterparts, each of which is an original.  It shall not be necessary in making proof of this Agreement or any counterpart hereof to produce or account for any of the other counterparts.  A copy of this Agreement
signed by one Party and faxed to another Party shall be deemed to have been executed and delivered by the signing Party as though an original.  A photocopy of this Agreement shall be effective as an original for all purposes.

  

  

  

IN WITNESS WHEREOF, the parties have duly executed and delivered this Agreement as of the day and year first above written to be effective as of the Effective Date.

	  	
"SELLER"

	  	  
	  	
Petron Energy Special Corp.

	  	
(Formerly Petron Energy II, Inc.)

 

	  	
/s/ Floyd L. Smith

	 	 
Floyd L. Smith

	  	
President

	  	  
	  	
"PURCHASER"

	  	  
	  	
Restaurant Concepts of America Inc.

	  	  
	  	
/s/ Floyd L. Smith

	  	
Floyd L. Smith

	  	
President

	  	  
	  	
“SELLER REPRESENTATIVE”

	  	  
	  	
/s/ Floyd L. Smith

	  	
Floyd L. Smith

	  	
Individually

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