<PAGE>
As filed with the Securities and Exchange Commission on May 15, 1996.
Registration No. 333-____________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
450 FIFTH STREET N.W.
WASHINGTON, D.C. 20549
_______________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
_______________________
SCHLOTZSKY'S, INC.
(Exact name of registrant as specified in its charter)
TEXAS 74-2654208
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
200 WEST FOURTH STREET 78701
AUSTIN, TEXAS (Zip Code)
(Address of Principal Executive Offices)
SCHLOTZSKY'S, INC.
1993 STOCK OPTION PLAN
1995 NONEMPLOYEE DIRECTORS STOCK OPTION PLAN
(Full title of the plan)
CHARLES E. HARVEY, JR. COPY TO:
EXECUTIVE VICE PRESIDENT AND PHILLIP M. SLINKARD, ESQ.
CHIEF FINANCIAL OFFICER HUGHES & LUCE, L.L.P.
200 WEST FOURTH STREET 111 CONGRESS AVENUE
AUSTIN, TEXAS 78701 SUITE 900
(512) 469-7500 AUSTIN, TEXAS 78701
(Name, address and telephone number, (512) 482-6836
including area code, of agent for service)
_______________________
CALCULATION OF REGISTRATION FEE
================================================================================
PROPOSED
PROPOSED MAXIMUM
TITLE OF CLASS AMOUNT MAXIMUM AGGREGATE AMOUNT OF
OF SECURITIES TO BE OFFERING PRICE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED(1) PER SHARE(2)(3) PRICE(2)(3) FEE(3)
- --------------------------------------------------------------------------------
Shares of Common Stock,
no par value per share.. 680,000 $11.25 $6,190,311 $2,134.42
================================================================================
(1) Pursuant to Rule 416 of the Securities Act of 1933 (the "Securities
Act"), this Registration Statement is deemed to include additional shares of
Common Stock issuable under the terms of the 1993 Stock Option Plan and the 1995
Non-Employee Directors Stock Option Plan to prevent dilution resulting from any
future stock split, stock dividend or similar transaction.
(2) Estimated solely for the purpose of calculating the registration fee.
(3) Calculated pursuant to Rule 457(c) and (h) of the Securities Act.
Accordingly, the price per share of the Common Stock offered hereunder pursuant
to the 1993 Stock Option Plan and the 1995 Non-Employee Directors Stock Option
Plan is based on (i) 70,105 shares of Common Stock originally reserved for
issuance under the 1993 Stock Option Plan and the 1995 Non-Employee Directors
Stock Option Plan and that are not currently subject to outstanding Stock
Options, at a price per share of $11.25, which is based upon the average bid and
asked price of the Common Stock on NASDAQ on May 9, 1996; and (ii) the following
609,895 shares of Common Stock reserved for issuance under the 1993 Stock Option
Plan and the 1995 Non-Employee Directors Stock Option Plan subject to Stock
Options already granted thereunder at the following prices:
No. of Shares of Common Stock Exercise Price
Reserved for Issuance Per Share
- ------------------------------- --------------
113,281 $ 5.60
277,565 8.00
2,500 9.50
10,000 10.50
56,563 11.00
55,861 11.20
1,000 11.50
5,000 11.75
78,125 12.80
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
EXPLANATORY NOTE
The information required by Items 1 and 2 of Part I of Form S-8 to be
contained in the Section 10(a) prospectus is omitted from this Registration
Statement on Form S-8 in accordance with Rule 428 of the Securities Act of 1933,
as amended (the "Securities Act"), and the Note to Part I of Form S-8.
I-2
<PAGE>
PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The registrant hereby incorporates by reference in this Registration
Statement the following documents previously filed by the registrant with the
Securities and Exchange Commission (the "Commission"):
(1) the registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995;
(2) the registrant's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1996; and
(3) the descriptions of the Common Stock, no par value per share, of the
registrant (the "Common Stock") set forth in the registration statement filed
pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and all amendments and reports which have been filed for the
purpose of updating such descriptions.
All documents filed by the registrant with the Commission pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, subsequent to the date
of this Registration Statement, shall be deemed to be incorporated herein by
reference and to be a part hereof from the date of the filing of such documents
until such time as there shall have been filed a post-effective amendment that
indicates that all securities offered hereby have been sold or that deregisters
all securities remaining unsold at the time of such amendment.
ITEM 4. DESCRIPTION OF SECURITIES.
The information required by this item is not applicable to this
Registration Statement.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The information required by this item is not applicable to this
Registration Statement.
ITEM 6. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
The Registrant has authority under Articles 2.02 (A) (16) and 2.02-1 of the
Texas Business Corporation Act (the "TBCA") to indemnify its directors and
officers to the extent provided for in such statute. The Registrant's Articles
of Incorporation and Bylaws allow indemnification of directors and officers to
the extent permitted by said provisions of the TBCA.
The TBCA provides in part that a corporation may indemnify a director or
officer or other person who was, is, or is threatened to be made a named
defendant or respondent in a proceeding because the person is or was a director,
officer, employee or agent of the corporation, if it is determined that (i) such
person conducted himself in good faith; (ii) reasonably believed, in the case of
conduct in his official capacity as a director or officer of the corporation,
that his conduct was in the corporation's best interests, and, in all other
cases, that his conduct was at least not opposed to the corporation's best
II-1
<PAGE>
interest; and (iii) in the case of any criminal proceeding, had no reasonable
cause to believe that his conduct was unlawful.
A corporation may indemnify a person under the TBCA against judgments,
penalties (including excise and similar taxes), fines, settlements, and
reasonable expenses actually incurred by the person in connection with the
proceeding. If the person is found liable to the corporation or is found liable
on the basis that personal benefit was improperly received by the person, the
indemnification is limited to reasonable expenses actually incurred by the
person in connection with the proceeding, and shall not be made in respect of
any proceeding in which the person shall have been found liable for willful or
intentional misconduct in the performance of his duty to the corporation.
A corporation may also pay or reimburse expenses incurred by a person in
connection with his appearance as a witness or other participation in a
proceeding at a time when he is not a named defendant or respondent in the
proceeding.
Reference is also made to the Articles of Incorporation, which limit or
eliminate a director's liability for monetary damages to the Registrant or its
shareholders for acts or omissions in the director's capacity as a director,
except that the articles of incorporation do not eliminate the liability of a
director for (i) a breach of the director's duty of loyalty to the Registrant or
its shareholders, (ii) an act or omission not in good faith that constitutes a
breach of duty of the director to the Registrant of an act or omission that
involves intentional misconduct or a knowing violation of the law, (iii) a
transaction from a director received an improper benefit, whether or not the
benefit resulted from an action taken within the scope of the director's office,
or (iv) an act or omission for which the liability of a director is expressly
provided for by an applicable statute. The Registrant's Bylaws further provide
that the Registrant may indemnify its officers and directors to the fullest
extent permitted by law.
Pursuant to a policy of directors' and officers' liability and corporation
reimbursement insurance, with total annual limits of $3,000,000 the registrant's
officers and directors are insured, subject to the limits, retention, exceptions
and other terms and conditions of such policy, against liability for any actual
or alleged breach of duty, neglect, error, misstatement, misleading statement,
omission or other act done or wrongfully attempted while acting in their
capacities as directors or officers of the registrant.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
The information required by this item is not applicable to this
Registration Statement.
II-2
<PAGE>
ITEM 8. EXHIBITS.
The following documents are filed as a part of this Registration Statement.
Exhibit
Number Description of Exhibit
------ ----------------------
* 4.1 - Articles of Incorporation of the Registrant,
as amended
* 4.2 - Bylaws of the Registrant, as amended
* 4.3 - Schlotzsky's, Inc. 1993 Amended and Restated Stock Option Plan
of the Registrant and form of Incentive Stock Option Agreement
* 4.4 - Schlotzsky's 1995 Non-Employee Directors Stock Option Plan, and
form of Stock Option Agreement.
4.5 - Form of Non-Qualified Option Agreement under the Registrant's
1993 Amended and Restated Stock Plan.
5.1 - Opinion of Hughes & Luce, LLP regarding legality of securities
being registered.
23.1 - Consent of Hughes & Luce, LLP (included in the firm's opinion
filed as Exhibit 5.1).
23.2 - Consent of Independent Accountant.
24.1 - Power of Attorney (see signature page of this Registration
Statement).
* Filed as an Exhibit to the registrant's Form S-1
ITEM 9. UNDERTAKINGS.
A. The undersigned registrant hereby undertakes:
(1) to file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement to include any material
information with respect to the plan of distribution not previously disclosed in
the Registration Statement or any material change to such information in the
Registration Statement;
(2) that, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof; and
(3) to remove from registration by means of a post-effective amendment any
of the securities being registered that remain unsold at the termination of the
offering.
B. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration
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<PAGE>
Statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question of whether such indemnification by it is against
public policy as expressed in the Securities Act and will be governed by the
final adjudication of such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Austin, Texas, on May 13, 1996:
SCHLOTZSKY'S, INC.
By: /s/ JOHN C. WOOLEY
-----------------------
John C. Wooley
Chairman of the Board
and President
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature
appears below constitutes and appoints John C. Wooley and Charles E. Harvey,
Jr., each of them, his true and lawful attorneys-in-fact and agents with full
power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments to this
Registration Statement, and to file the same with all exhibits, thereto, and all
documents in connection therewith, with the Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said attorneys-in-
fact and agents or either of them, or their or his substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated:
SIGNATURE CAPACITY DATE
--------- -------- ----
/s/ JOHN C. WOOLEY Chairman of the Board and President May 13, 1996
- --------------------------- (Principal Executive Officer)
John C. Wooley
/s/ CHARLES E. HARVEY, JR. Executive Vice President and Chief May 13, 1996
- --------------------------- Financial Officer (Principal
Charles E. Harvey, Jr. Financial Officer)
/s/ JEFFREY J. WOOLEY Senior Vice President, Secretary, May 13, 1996
- --------------------------- General Counsel, Director
Jeffrey J. Wooley
/s/ MONICA GILL Controller, Treasurer (Principal May 13, 1996
- --------------------------- Accounting Officer)
Monica Gill
II-5
<PAGE>
/s/ JOHN L. HILL, JR. Director May 13, 1996
- ---------------------------
John L. Hill, Jr.
/s/ AZIE TAYLOR MORTON Director May 13, 1996
- ---------------------------
Azie Taylor Morton
/s/ JOHN M. ROSILLO Director May 13, 1996
- ---------------------------
John M. Rosillo
/s/ RAYMOND A. RODRIGUEZ Director May 13, 1996
- ---------------------------
Raymond A. Rodriguez
/s/ FLOOR MOUTHAAN Director May 13, 1996
- ---------------------------
Floor Mouthaan
II-6
<PAGE>
EXHIBIT 4.5
SCHLOTZSKY'S, INC.
Nonqualified Stock Option Agreement
This Agreement ("Agreement") is entered into as of ____________,
199__, between SCHLOTZSKY'S, INC., a Texas corporation (the "Company"), and
____________________, a consultant of the Company (the "Consultant").
R E C I T A L S:
---------------
The Company desires to grant to the Consultant an Option to purchase
shares of its Common Stock, no par value (the "Shares") pursuant to the
Company's 1993 Stock Option Plan (the "Plan") in consideration for certain
covenants from the Consultant. The Company and the Consultant understand and
agree that any terms used herein have the same meanings as in the Plan.
The parties agree as follows:
1. Grant of Option. The Company hereby irrevocably grants to the
---------------
Consultant the right and option to purchase all or any part of an aggregate of
________ Shares on the terms and conditions and subject to all the limitations
set forth herein and in the Plan, which is incorporated herein by reference.
The Consultant acknowledges receipt of a copy of the Plan.
The Option granted hereunder is a Non-Qualified Option, as defined
under the Plan.
2. Purchase Price. The purchase price of the Shares covered by the
--------------
Option shall be $______ per share.
3. Exercise of Option. Subject to the other terms and conditions of
------------------
this Agreement, the Option granted hereby shall vest and become exercisable only
on and after the dates set forth below as to the number of shares set forth
opposite such dates below:
______________________ ____________
______________________ ____________
______________________ ____________
4. Term of Option. The Option shall terminate ten years from the
--------------
date of this Agreement, but shall be subject to earlier termination as provided
herein or in the Plan.
(a) Voluntary Termination or Termination Without Cause
--------------------------------------------------
If the Consultant ceases to be a consultant of the Company or of an
Affiliate (for any reason other than termination of the Consultant for cause),
the Option shall be exercisable only to the extent that the right to purchase
shares under the Plan has vested and accrued and is in effect at the date of
such cessation of employment until the date upon which the Option terminates, as
<PAGE>
originally prescribed by this Agreement; provided, however, that the Option
-------- -------
shall terminate (and shall not vest) as to the number of shares vesting on
__________, 199__ if Consultant shall have ___________________________.
(b) Termination for Cause.
---------------------
In the event the Consultant's contract is terminated by the Company
(or an Affiliate) for "cause" (as defined in the Plan) or for a material breach
of this Agreement, the Consultant's right to exercise any unexercised portion of
this Option shall cease immediately, and this Option shall thereupon terminate.
(c) Death.
-----
In the event of the death of the Consultant, the Option may be
exercised by the Consultant's legal representatives or any person who acquired
the Consultant's rights to the Option by will or by the laws of descent and
distribution.
5. Non-Assignability. The Option shall not be transferable by the
-----------------
Consultant otherwise than by will or by the laws of descent and distribution and
shall be exercisable, during the Consultant's lifetime, only by the Consultant
or his or her guardian or legal representative. The Option shall not be
assigned, pledged or hypothecated in any way (whether by operation of law of
otherwise) and shall not be subject to execution, attachment or similar process.
Any attempted transfer, assignment, pledge, hypothecation or other disposition
of the Option or of any rights granted hereunder contrary to the provisions of
this paragraph 5, or the levy of any attachment or similar process upon the
Option or such rights, shall be null and void.
6. Exercise of Option and Issue of Shares. The Option may be
--------------------------------------
exercised in whole or in part (to the extent that it is exercisable in
accordance with its terms) by giving written notice to the Company, together
with the tender of the Option price. Such written notice shall be signed by the
person exercising the Option, shall state the number of Shares with respect to
which the Option is being exercised, shall contain any representation required
by paragraph 7 below and shall otherwise comply with the terms and conditions of
this Agreement and the Plan. The Company shall pay all transfer or original
issue taxes with respect to the issue of the Shares pursuant hereto and all
other fees and expenses necessarily incurred by the Company in connection
herewith. Except as specifically set forth herein, the holder acknowledges that
any income or other taxes due form him or her with respect to this Option or the
shares issuable pursuant to this Option shall be the responsibility of the
holder and that the Company may, in accordance with the Internal Revenue Code,
require the holder to pay additional withholding taxes in respect of the amount
that is considered compensation includable in such holders' gross income. The
holder of this Option shall have rights as a shareholder only with respect to
any Shares covered by the Option after due exercise of the Option and tender of
the full exercise price for the shares being purchased pursuant to such
exercise.
7. Purchase for Investment. Unless the offering and sale of the
-----------------------
Shares to be issued upon the particular exercise of the Option shall have been
effectively registered under the Securities Act of 1933, as amended, or any
successor legislation (the "Act"), the Company shall
2
<PAGE>
be under no obligation to issue the Shares covered by such exercise unless and
until the following conditions have been fulfilled.
The person(s) who exercise the Option shall represent to the Company,
at the time of such exercise, that such person(s) are acquiring such Shares for
his or her own account, for investment and not with a view to, or for sale in
connection with, the distribution of any such Shares, in which event the
person(s) acquiring such Shares shall be bound by the provisions of the
following legend which shall be endorsed upon the certificate(s) evidencing
their option Shares issued pursuant to such exercise;
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE FEDERAL SECURITIES
ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE. WITHOUT
SUCH REGISTRATION, SUCH SECURITIES MAY NOT BE SOLD, PLEDGED,
HYPOTHECATED OR OTHERWISE TRANSFERRED, EXCEPT UPON DELIVERY TO THE
COMPANY OF AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT
REGISTRATION IS NOT REQUIRED FOR SUCH TRANSFER OR THE SUBMISSION TO
THE COMPANY OF SUCH OTHER EVIDENCE AS MAY BE SATISFACTORY TO THE
COMPANY TO THE EFFECT THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION
OF THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE
SECURITIES LAWS OR ANY RULE OR REGULATION PROMULGATED THEREUNDER."
Without limiting the generality of the foregoing, the Company may delay
issuance of the Shares until completion of any action or obtaining of any
consent, which the Company deems necessary under any applicable law (including
without limitation state securities or "blue sky" laws).
8. Consultant Covenants.
--------------------
(a) Confidential Information. The Consultant acknowledges that the
------------------------
information, observations and data obtained by him while employed by the Company
(including those obtained by him while employed at the Company prior to the date
of this Agreement) concerning the business or affairs of the Company
("Confidential Information") are the property of the Company. Therefore,
Consultant agrees that he shall not disclose to any unauthorized person or use
for his own account any Confidential Information, unless and to the extent that
the aforementioned matters become generally known to and available for use by
the public other than as a result of Consultant's acts or omissions to act.
Consultant shall deliver to the Company at the termination of employment, or at
any other time the Company may request, all memoranda, notes, plans, records,
reports and other documents (and copies thereof) relating to the Confidential
Information or the business of the Company which he may then possess or have
under his control.
3
<PAGE>
(b) Inventions, Copyrights and Patents.
----------------------------------
(i) Consultant agrees that all inventions, innovations,
improvements, developments, methods, designs, analyses, drawings, reports, works
of authorship and all similar or related information which relates to the
Company's actual or anticipated business, research and development or existing
or future products or services and which are conceived, developed, authored or
made by Consultant while employed by the Company ("Work Product") belong to the
Company. Consultant will promptly disclose such Work Product to the President
and perform all actions reasonably requested by the President to establish and
confirm such ownership, including, but not limited to, executing documents filed
with appropriate authorities to register the Work Product and assign title to
the Company. In order to effectuate the intent of the foregoing provision,
Consultant agrees to and hereby does appoint the Company as its irrevocable
attorney-in-fact for the purpose of executing all documentation reasonably
necessary to register the Work Product with appropriate authorities and assign
title thereto to the Company.
(ii) Consultant is hereby advised that Section 8(b)(i) of this
Agreement regarding the Company's ownership of intellectual property does not
apply to any invention for which no equipment, supplies, facilities or trade
secret information of the Company was used and which was developed entirely on
Consultant's own time, unless (i) the invention relates to the business of the
Company or to the Company's actual or demonstrably anticipated research or
development or (ii) the invention results from any work performed by another
consultant or employee of the Company.
(c) Non-Solicitation. Consultant acknowledges that in the course of
----------------
his employment with the Company he will become familiar, and during his
employment with the Company he has become familiar, with the Company's trade
secrets and with other confidential information concerning the Company and that
his services will be of special, unique and extraordinary value to the Company.
Consultant agrees that during employment, Consultant shall not (i) induce or
attempt to induce any employee of the Company to leave the employ of the Company
or in any way interfere with the relationship between the Company and any
employee thereof, (ii) hire directly or through another entity any person who
was an employee of the Company at any time during employment or (iii) induce or
attempt to induce any customer, supplier, licensee or other business relation of
the Company to ceases doing business with the Company or in any what interfere
with the relationship between any such customer, supplier, licensee or business
relation and the Company.
(d) Engagement. Consultant agrees to devote his best efforts and that
----------
amount of business time and attention as is necessary to prudently dispense his
fiduciary and other obligations to the Company consistent with the agreement
between himself and the Company concerning his engagement.
(e) Enforcement. If, at the time of enforcement of paragraphs 8 (a),
-----------
(b), (c) or (d) of this Agreement, a court holds that the restrictions stated
herein are unreasonable under circumstances then existing, the parties hereto
agree that the maximum period, scope or geographical area reasonable under such
circumstances shall be substituted for the stated period, scope or area. Because
Consultant's services are unique and because Consultant has access to
4
<PAGE>
Confidential Information and Work Product, the parties hereto agree that money
damages would be inadequate remedy for any breach of this Agreement. Therefore,
in the event a breach or threatened breach of this Agreement, the Company or its
successors or assigns may, in addition to other rights and remedies existing in
their favor, apply to any court of competent jurisdiction for specific
performance or injunction or other relief in order to enforce, or prevent any
violations of, the provisions hereof.
(f) Shareholder Agreement. Consultant agrees to execute and become
---------------------
bound by the Shareholders Agreement attached hereto as Exhibit A upon the first
exercise of all or part of the Option.
9. Notices. Any notices required or permitted by the terms of this
-------
Agreement or the Plan shall be given by personal delivery or registered or
certified mail, return receipt requested, addressed as follows:
To the Company: SCHLOTZSKY'S, INC.
200 West 4th Street
Austin, Texas 78701
Attn: President
To the Consultant, to the
address shown below,
or to such other address or addresses of which notice in the same manner has
previously been given. Any such notice shall be deemed to have been given when
given in accordance with these provisions.
10. Governing Law. This Agreement shall be construed and enforced in
-------------
accordance with the internal laws, and not the laws of conflict, of the State of
Texas.
11. Benefit of Agreement. This Agreement shall be for the benefit of
--------------------
and shall be binding upon the heirs, executors, administrators and successors of
the parties hereto. Notwithstanding anything else contained herein or in the
Plan, the Consultant shall have no contractual right to be retained as a
consultant to or to be employed by the Company or its subsidiaries for any
period of time.
* * *
5
<PAGE>
EXECUTED on _________ ____, 199__.
SCHLOTZSKY'S, INC.
By: /s/ John C. Wooley, President
---------------------------------------
John C. Wooley, President
-------------------------------------------
[Name]
Address:
-------------------------------------------
-------------------------------------------
6
<PAGE>
EXHIBIT 5.1
[LETTERHEAD OF HUGHES & LUCE, LLP APPEARS HERE]
May 14, 1996
Schlotzsky's, Inc.
200 W. Fourth Street
Austin, Texas 78701
Re: REGISTRATION STATEMENT ON FORM S-8
Ladies and Gentlemen:
We have acted as counsel to Schlotzsky's, Inc., a Texas corporation (the
"Company"), in connection with the preparation of the Registration Statement on
Form S-8 (the "Registration Statement") to be filed with the Securities and
Exchange Commission on May 15, 1996, under the Securities Act of 1933, as
amended (the "Securities Act"), relating to 680,000 shares (the "Shares") of the
no par value common stock (the "Common Stock") of the Company that may be
offered on the exercise of any stock options (the "Stock Options"), granted or
that may be granted under the 1993 Stock Option Plan, as amended, and the 1995
Nonemployee Directors Stock Option Plan, as amended (the "Plans").
You have requested the opinion of this firm with respect to certain legal
aspects of the proposed offering. In connection therewith, we have examined and
relied upon the original, or copies identified to our satisfaction, of (1) the
certificate of incorporation and the bylaws of the Company, as amended; (2)
minutes and records of the corporate proceedings of the Company with respect to
the establishment of the Plans, the issuance of shares of Common Stock pursuant
to the Plans and related matters; (3) the Registration Statement and exhibits
thereto, including the Plan; and (4) such other documents and instruments as we
have deemed necessary for the expression of opinions herein contained. In
making the foregoing examinations, we have assumed the genuineness of all
signatures and the authenticity of all documents submitted to us as originals,
and the conformity to original documents of all documents submitted to us as
certified or photostatic copies. As to various questions of fact material to
this opinion, and as to the content and form of the certificate of
incorporation, the bylaws, minutes, records, resolutions and other documents or
writings of the Company, we have relied, to the extent we deem reasonably
appropriate, upon representations and certificates of officers or directors of
the Company and upon documents, records and instruments furnished to us by the
Company, without independent investigation or verification of their accuracy.
<PAGE>
May 14, 1996
Page 2
Based upon our examination and consideration of, and reliance on the
documents and other matters described above, we are of the opinion that the
Company presently has available at least 680,000 shares of authorized and
unissued Common Stock and/or treasury shares of Common Stock currently issuable
pursuant to the Plans from which the 680,000 shares of Common Stock proposed to
be sold pursuant to the exercise of Stock Options granted or to be granted under
the Plans may be issued. Assuming that (i) the outstanding Stock Options were
duly granted, and the Stock Options to be granted in the future are duly granted
in accordance with the terms of the Plans and the shares of Common Stock to be
issued in the future are duly issued in accordance with the terms of the Plans
and their respective Stock Options, (ii) the Company maintains an adequate
number of authorized but unissued shares and/or treasury shares of Common Stock
available for issuance for those persons who exercise Stock Options granted
under the Plans, and (iii) the consideration for shares of Common Stock issued
pursuant to such Stock Options is actually received by the Company as provided
in the Plans and the respective Stock Options and exceeds the par value of such
shares, then the shares of Common Stock issued pursuant to the exercise of the
Stock Options granted under and in accordance with the terms of the Plans will
be duly and validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to references to our firm included in or made a part
of the Registration Statement. In giving this consent, we do not admit that we
come within the category of person whose consent is required under Section 7 of
the Securities Act or the Rules and Regulations of the Securities and Exchange
Commission thereunder.
Very truly yours,
HUGHES & LUCE, L.L.P.
By: /s/ PHILLIP M. SLINKARD
-------------------------------
Phillip M. Slinkard, Authored Signatory
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the inclusion in this registration statement on Form S-8 of our
report dated March 6, 1996, on our audits of the consolidated financial
statements and financial statement schedules of Schlotzsky's, Inc. and
Subsidiaries.
Coopers & Lybrand L.L.P.
Austin, Texas
May 14, 1996
