UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD
FROM____ TO____
Commission File Number 0-10943
RYAN'S FAMILY STEAK HOUSES, INC.
(Exact name of registrant as specified in its charter)
South Carolina 57-0657895
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
405 Lancaster Avenue, Greer, South Carolina 29650
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (864) 879-1000
Securities registered pursuant to Section 12(b) of the Act:
None None
(Title of class) (Name of each exchange
on which registered)
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $1.00 Par Value
(Title of class)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90
days. Yes [ X ] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of the registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III
of this Form 10-K or any amendment to this Form 10-K. [ X ]
The aggregate market value of the voting stock held by non-
affiliates (shareholders holding less than 5% of the outstanding
common stock, excluding directors and officers), computed by reference
to the average high and low prices of such stock, as of March 4, 1998,
was $375,007,000.
The number of shares outstanding of the registrant's Common Stock,
$1.00 Par Value, was 45,113,580 at March 4, 1998.
DOCUMENTS INCORPORATED BY REFERENCE
Incorporated Document Location in Form 10-K
Portions of 1997 Annual Report of Shareholders Parts I and II
Portions of Proxy Statement dated March 27, 1998 Part III
PART I
ITEM 1. BUSINESS.
General
Ryan's Family Steak Houses, Inc., the Registrant (together with its
subsidiaries referred to hereafter as the "Company"), is a South
Carolina corporation that operates a chain of restaurants located
principally in the southern and midwestern United States. At March 4,
1998, 272 Company-owned and 25 franchised Ryan's Family Steakhouse
restaurants (restaurants using the Ryan's Family Steakhouse format are
referred to hereafter as "Ryan's" or "Ryan's restaurant") were in
operation. System-wide sales, which include sales by franchised
restaurants, were approximately $636 million and $598 million in 1997
and 1996, respectively. Sales by Company-owned restaurants amounted
to approximately $599 million in 1997 and $565 million in 1996. The
Company, headquartered in Greer, South Carolina, was organized in 1977
and completed its initial public offering in 1982.
The following table indicates the number of Company-owned
restaurants opened each year, net of closings, and the total number of
Company-owned restaurants open at each year-end during the 5-year
period ending 1997:
All Concepts
Restaurant Total Open
Year Openings, Net at Year-End
1993 29 194
1994 18 212
1995 19 231
1996 30 261
1997 9 270
Restaurant Operations
General. A Ryan's restaurant is a family-oriented restaurant
serving a wide variety of foods from its Mega Bar* as well as
traditional grilled entrees, such as charbroiled USDA Choice steaks,
hamburgers, chicken and seafood. The Mega Bar* includes fresh and pre-
made salad items, soups, cheeses, a variety of hot meats and
vegetables, and hot yeast rolls prepared and baked daily on site. All
entree purchases include a trip to a bakery bar. Bakery bars feature
hot and fresh-from-the-oven cookies, brownies and other bakery
products as well as various dessert selections, such as ice cream,
frozen yogurt, fresh fruit, cakes, cobblers and several dessert
toppings. All Ryan's also offer a variety of non-alcoholic beverages.
All restaurants have their Mega Bars* in a scatter bar format. This
format breaks the Mega Bar* into five island bars for easier customer
access and more food variety.
Most Ryan's are open seven days a week. Some new restaurants are
closed on Mondays during their first two to three months of operation.
Typical hours of operation are 11:00 a.m. to 9:30 p.m. Sunday through
Thursday and 11:00 a.m. to 10:30 p.m. Friday and Saturday. The
average customer count per restaurant during 1997 was approximately
7,000 per week, and the average meal price (per person) was $6.22
(including beverage). Management believes that the average table
turns over every 30 to 45 minutes.
Each Company-owned Ryan's is located in a free-standing brick
building that may range in size from approximately 10,000 to 11,500
square feet. The interior of most restaurants contains two or three
dining rooms, seating approximately 300 to 500 persons in total, an
area where customers both order and pay for their meals and a kitchen.
The focal points of the main dining room are the centrally located
scatter bars (referred to in the restaurants as the Mega Bar*) and
bakery bar. An average Ryan's has parking for approximately 180 cars.
Restaurant Management and Supervision. The Company emphasizes
standardized operating and control systems together with comprehensive
recruiting and training programs in order to maintain food and service
quality. In each Ryan's restaurant, the management team typically
consists of a general manager, a manager and two assistant managers.
Management personnel begin employment at the manager trainee level and
complete a formal five-week training program at the Company's
management training center in Greer, South Carolina, prior to being
placed in assistant manager positions.
Each restaurant management team reports to an area supervisor.
Area supervisors normally oversee the operations of four to eight
restaurants and report to one of eight regional directors, a position
that may be at the Vice President level and, in any case, reports to
the Vice President-Operations. Communication and support from all
corporate office departments are designed to assist the area
supervisors and regional directors to respond promptly to local
concerns.
All regional directors, area supervisors, general managers and
managers participate in incentive bonus programs. Bonuses paid to
restaurant management are generally based on the monthly sales volume
of their individual restaurant with deductions for excess spending in
key expense items, such as food cost, payroll and cash shortages. The
bonus program for area supervisors and regional directors is based
principally upon same-store sales, profitability, "hidden shopper"
(service feedback) scores and certain qualitative factors.
In 1997, an Operating Partner Program was initiated in order to
provide general managers with (a) an additional career path and (b) an
opportunity to share in the profitability of their stores. After
being selected and upon a $10,000 investment in Ryan's common stock,
an Operating Partner shares in both the profit improvement and overall
profitability of their restaurant. At December 31, 1997, Operating
Partners were managing 15 restaurants. The Company's goal is to have
100 Operating Partners in place by December 1998.
Advertising. The Company has not relied extensively on
advertising, expending less than one percent of restaurant sales
during each of the years 1997, 1996, and 1995. In 1997, the Company
ran advertising campaigns, consisting of both television and radio, in
18 markets covering 87 Ryan's. Newspaper ads and billboards were used
in certain other markets. Management believes that the restaurant
industry has become increasingly competitive over the past several
years and that advertising will become an important factor in the
development and retention of market share. Based on current budgets,
media campaigns are planned in 1998 for markets covering approximately
35% of all Company-owned Ryan's. Local store marketing will be used
in certain smaller markets
Expansion of Company-Owned Restaurants
General. At March 4, 1998, the Company owned and operated 272
Ryan's restaurants. During the remainder of 1998, 9 additional Ryan's
are scheduled to open, resulting in 11 new Company-owned Ryan's in
1998. Target sites for these new restaurants are spread throughout
the Company's current 21-state operating area with the exception of
one unit to be opened in Pennsylvania. The addition of this first
Pennsylvania unit will expand the Company's coverage to 22 states.
The Company also plans to relocate 4 restaurants during 1998.
Management defines a relocation as a restaurant opened within 18
months after closing another restaurant in the same marketing area. A
relocation represents a redeployment of assets within a market. The
following table summarizes the Company's openings, closings and
relocations during 1997, 1996 and 1995.
1997 1996 1995
Beginning of year 261 231 212
New restaurants 15 30 24
Relocations - opened 1 - -
Closings (6) - (5)
Relocations - closed (1) - -
End of year 270 261 231
Test Concepts. At the beginning of 1997, the Company operated 261
restaurants, consisting of 256 Ryan's and 5 casual-dining restaurants,
representing three different concepts. All five of the casual-dining
restaurants were closed in early-1997 due to unsatisfactory financial
performance. In 1996, a $13.3 million asset valuation charge was
recorded in accordance with Statement of Financial Accounting
Standards No. 121, "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to Be Disposed of" in order to recognize the
estimated losses resulting from the planned disposal of these 5 units.
Four of these units were sold in 1997 with the proceeds from their
sale approximating their aggregate net book value after application of
the $13.3 million asset valuation charge. Management plans to
continue to actively market the remaining closed unit, but currently
cannot estimate its expected disposal date.
Site Selection. The Company employs a real estate manager and uses
independent real estate brokers to locate potential new sites and to
perform all preliminary site investigative work. Final approval is
made by the Company's executive management. Important factors in site
selection include population, demographics, proximity to both business
and residential areas, traffic count and site accessibility. In
addition, site selection for a Ryan's restaurant is also influenced by
the general proximity to other Ryan's in order to improve the
efficiency of the Company's area supervisors, advertising programs and
distribution network.
Construction. The Company presently acts as the general contractor
in the construction of most of its restaurants. Occasionally when
determined cost beneficial, the Company engages non-affiliated general
contractors to construct restaurants on a lump-sum contract basis.
The Company requires performance and payment bonds on certain building
and site work contracts, depending on the size and reputation of, as
well as Company history with, the contractor. The Company closely
supervises and monitors the progress of all construction projects. New
restaurants are generally completed approximately three to four months
from the commencement of construction. The average cost of a new
Ryan's (land, building and equipment) constructed in 1997 was
approximately $2.3 million.
Restaurant Opening. When a new Ryan's is opened, all restaurant
management positions are staffed with personnel who have had prior
management experience in another of the Company's restaurants. Prior
to opening, all staff personnel at the new location undergo one week
of intensive training conducted by a new store opening team.
Franchising. While the Company has granted Ryan's franchises in
the past, management has not actively pursued new franchisees in
recent years in order to concentrate on the operation and development
of Company-owned restaurants. New franchises may be awarded to the
existing franchisee or to new franchisees proposing to operate in
regions significantly outside of the Company's existing or
contemplated operating areas.
The following table indicates the number of franchised restaurants
opened each year, net of closings, and the total number of franchised
restaurants open at each year-end during the 5-year period ending
December 31, 1997:
Net
Restaurants Total Open
Year Opened (Closed) at Year-End
1993 (1) 34
1994 (4) 30
1995 (4) 26
1996 (1) 25
1997 - 25
At December 31, 1997, the Company's sole franchisee was
Family Steak Houses of Florida, Inc. ("Family") which operated 25
Ryan's in central and northern Florida. The present franchise
agreement with Family expires in 2010 with a 10-year renewal
option. The agreement provides that the Company will furnish
Family all the necessary information to construct, equip, manage
and operate a restaurant under the Ryan's Family Steakhouse name
or derivative thereof. The agreement generally provides for the
construction and operation of one restaurant with exclusive
territorial protection within a one to five mile radius.
The franchise agreement with Family provides for exclusive
territorial protection in certain Florida counties as long as Family
opens a specified number of new Ryan's. During the fourth quarter of
1993, Family informed the Company that it would be unable to pay its
royalty fees from August through December 1993, and this nonpayment
condition subsequently continued through the second quarter of 1994.
In July 1994, an agreement was reached with Family regarding both past-
due and future royalty fees. This agreement provided for a $236,000
cash payment by Family, the relinquishment of Family's exclusive
development rights in certain counties in South Florida and the
Florida panhandle (subject to first refusal and buy-back rights of
Family), an $800,000 long-term note payable to the Company and a
reduction in the royalty fee rate from 4.25% to 3% until December 31,
2001, at which time the rate will increase to 4%. The relinquishment
of development rights was valued at $500,000 and treated as a partial
write-off of Family's past-due royalty fees. In addition, the
agreement with Family decreased the required number of Ryan's
restaurants in operation to 24 through the end of 1996 and to 25 at
the end of 1997. Pursuant to the agreement, the required number of
restaurants in operation will then increase by 1 for each year after
1997. All required payments from Family to the Company subsequent to
the agreement have been received in a timely manner. However, due to
Family's payment history, the Company's accounting policy regarding
Family's royalty fees was changed during 1994 to a cash basis.
Accordingly, all royalty fees received thereafter, including payments
required under the long-term note payable, have been recognized as
revenue when received.
Sources and Availability of Raw Materials
The Company has a centralized purchasing program which is designed
to ensure uniform product quality in all restaurants as well as
reduced food, beverage and supply costs. The Company's management
establishes contracts for approximately 92% of its food and other
products from a variety of major suppliers under competitive terms.
Purchases under these contracts are delivered to one of three
warehouses operated by the Company's principal distributor and then
delivered to the restaurants by the distributor. The remaining 8% of
the Company's products (principally fresh produce) are purchased
locally by restaurant management. The beef used by the Company is
obtained from four western suppliers based on price and availability
of product. To ensure against interruption in the flow of beef
supplies due to unforeseen or catastrophic events and to take
advantage of favorable purchasing opportunities, the Company
stockpiles four to eight weeks supply of sirloin at the distributor.
The Company believes that satisfactory sources of supply are generally
available for all the items regularly used.
Working Capital Requirements
Working capital requirements for continuing operations are not
significant. The Company's restaurant sales are primarily derived
from cash sales, and inventories are purchased on credit and are
rapidly converted to cash. Therefore, the Company does not maintain
significant receivables or inventories.
Trademarks and Service Marks
The Company has registered various trademarks and service marks,
including "Ryan's Family Steak House" and "Mega Bar," and their
related designs with the United States Patent and Trademark Office.
All trademarks and service marks have stated expiration dates ranging
from December 2001 to October 2008. However, they are renewable for
an unlimited number of additional 10-year terms at the option of the
Company.
Competition
The food service business is highly competitive and is often
impacted by changes in the taste and eating habits of the public,
economic conditions affecting spending habits, population and traffic
patterns. The principal bases of competition in the industry are the
quality and price of the food products offered. Location, speed of
service and attractiveness of facilities are also important factors.
Ryan's restaurants are in competition with many units operated or
franchised by national, regional and local restaurant companies that
offer steak or buffet-style meals. Although the Company believes that
its price/value to its customers places it in an excellent competitive
posture, it should be noted that during the last few years many
operators have upgraded their restaurants to more closely match the
Ryan's format and particularly the Mega Bar*. The Company is also in
competition with many specialty food outlets and other food vendors.
Seasonality
The Company's operations are subject to some seasonal fluctuations.
When compared to average annual sales levels, sales per restaurant
generally increase by approximately 5% during the second and third
quarters and decrease by approximately 5% during the first and fourth
quarters.
Research
The Company maintains ongoing research programs relating to the
development of new products and evaluation of marketing activities.
The Company's management staff includes a Director of Research and
Development, whose responsibilities include enhancing and updating the
Mega Bar* and entree selections. While research and development
activities are important to the Company, past expenditures have not
been and future expenditures are not expected to be material to the
Company's financial results.
Customers
No material part of the Company's business is dependent upon a
single customer or a specific group of customers.
Regulation
The Company is subject to the Fair Labor Standards Act which
regulates matters such as minimum wage requirements, overtime and
other working conditions. A significant number of the Company's
restaurant team members are paid at the minimum wage, and,
accordingly, legislated changes to the minimum wage affect the
Company's payroll costs. In July 1996, the U.S. Congress legislated
an increase in the Federal minimum wage from $4.25 per hour to $4.75
on October 1, 1996 and then to $5.15 on September 1, 1997. The
legislation did not increase the $2.13 rate for servers. Management
estimates that the increase to $5.15 per hour required rate changes
for approximately 20% of the Company's team members. Menu prices were
increased to cover the higher payroll costs.
The Company's restaurants are constructed to meet local and state
building code requirements and are operated in material accordance
with state and local regulations relating to the preparation and
service of food.
The Company's franchise operations are subject to a variety of laws
regulating franchising. The Federal Trade Commission has adopted a
rule that imposes certain disclosure requirements on persons engaged
in the business of offering franchises. Various states in which the
Company has offered franchises have franchising laws that require
registration prior to offering franchises for sale and/or that
regulate the rights of franchisees, including the circumstances under
which franchises may be terminated. Management believes its
operations are in material compliance with all applicable franchising
laws and regulations.
Environmental Matters
While the Company is not aware of any federal, state or local
environmental regulations which will materially affect its operations
or competitive position or result in material capital expenditures, it
cannot predict the impact of possible future legislation or regulation
on its operations.
Employees
At March 4, 1998, the Company employed approximately 18,000
persons, of whom approximately 17,700 were restaurant personnel. The
Company strives to maintain low turnover by offering all full-time
employees a very competitive benefit package, which includes life and
health insurance, vacation pay and a defined contribution retirement
plan. Part-time employees who work at least 15 hours per week are
eligible to participate in the Company's life and health insurance
plans and also receive vacation pay.
None of the Company's employees are represented by a union. The
Company has experienced no work stoppages attributable to labor
disputes and considers its employee relations to be good.
Information as to Classes of Similar Products or Services
The Company operates in only one industry segment. All significant
revenues and pre-tax earnings relate to retail sales of food to the
general public through either Company-operated or franchised
restaurants. At March 4, 1998, the Company had no operations outside
the continental United States.
Information regarding the Company's restaurant sales and assets is
included in the Company's financial statements, which are incorporated
by reference into Part II, Item 8 of this Form 10-K.
ITEM 2. PROPERTIES.
The Company owns substantially all of its restaurant properties,
each of which is a free-standing brick building that covers
approximately 10,000 to 11,500 square feet, with seating for
approximately 300 to 500 persons and parking for approximately 150 to
250 cars on sites of approximately 75,000 to 130,000 square feet. At
March 4, 1998, all restaurant sites, except 12 properties under land
leases, were owned by the Company.
A listing of the number of Ryan's restaurant locations by state as
of March 4, 1998 appears on page 2 of the Company's 1997 Annual Report
to Shareholders and is incorporated herein by reference. A detailed
listing of Ryan's restaurant locations may be obtained without charge
by writing to the Company's principal executive offices, Attention:
Corporate Secretary.
The Company's corporate offices consist of two office buildings
(30,000 square feet and 16,000 square feet) and a 20,000 square foot
warehouse facility. These properties (land and building) are owned by
the Company and located in Greer, SC.
From time to time, the Company offers for sale excess land that was
acquired in connection with its restaurant properties. Also, at March
4, 1998, two closed restaurant properties were offered for sale. The
Company believes that the eventual disposition or non-disposition of
all such properties will not materially affect its business or
financial condition, taken as a whole.
ITEM 3. LEGAL PROCEEDINGS.
From time to time, the Company is a defendant in legal actions
arising in the normal course of its business. The Company believes
that, as a result of its legal defenses and insurance arrangements,
none of these actions, if decided adversely, would have a material
effect on its business or financial condition, taken as a whole.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS.
The information regarding trading of the Company's common stock,
quarterly market prices and dividends appears under "Common Stock
Data" and "Market Price of Common Stock" on page 23 of the Company's
1997 Annual Report to Shareholders and is incorporated herein by
reference.
At March 4, 1998, the Company's common stock was held by
approximately 20,000 stockholders of record through nominee or street
name accounts with brokers.
The Company is party to a long-term credit agreement, expiring in
June 2003, with a group of banks that contains, among other
provisions, requirements for the Company to maintain a minimum net
worth level and certain financial ratios. While not specifically
prohibiting the payment of dividends, the aforementioned provisions
represent a limitation on the Company's ability to do so. At December
31, 1997, the Company exceeded the most restrictive minimum net worth
covenant by approximately $59.5 million.
ITEM 6. SELECTED FINANCIAL DATA.
Selected financial data for the last five years is included in the
"Five Year Financial Summary" on page 10 of the Company's 1997 Annual
Report to Shareholders and is incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS.
"Management's Discussion and Analysis of Financial Condition and
Results of Operations" is included on pages 5 through 9 of the
Company's 1997 Annual Report to Shareholders and is incorporated
herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The Company's financial statements, unaudited quarterly financial
information and the independent auditors' report are included on pages
11 through 21 of the Company's 1997 Annual Report to Shareholders and
are incorporated herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE.
None.
PART III
ITEM 10.DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
The information required under this item is incorporated herein by
reference to the Ryan's Family Steak Houses, Inc. Proxy Statement for
the Annual Meeting of Shareholders to be held April 30, 1998 under the
headings "Election of Directors" and "Executive Officers."
ITEM 11.EXECUTIVE COMPENSATION.
The information required under this item is incorporated herein by
reference to the Ryan's Family Steak Houses, Inc. Proxy Statement for
the Annual Meeting of Shareholders to be held April 30, 1998 under the
headings "Election of Directors - Compensation of Directors",
"Compensation Committee Interlocks, Insider Participation and Related
Party Transactions", "Executive Compensation and Other Information",
"Report of the Compensation Committee and Stock Option Committee" and
"Performance Graph."
ITEM 12.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
The information required under this item is incorporated herein by
reference to the Ryan's Family Steak Houses, Inc. Proxy Statement for
the Annual Meeting of Shareholders to be held April 30, 1998 under the
headings "Election of Directors", "Certain Beneficial Owners of Common
Stock" and "Executive Officers."
ITEM 13.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The information required under this item is incorporated herein by
reference to the Ryan's Family Steak Houses, Inc. Proxy Statement for
the Annual Meeting of Shareholders to be held April 30, 1998 under the
headings "Compensation Committee Interlocks, Insider Participation and
Related Party Transactions" and "Executive Compensation and Other
Information - Deferred Compensation - Salary Continuation Agreement."
PART IV
ITEM 14.EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-
K.
(a)1-2Financial statements filed as part of this Form 10-K are
listed in the "Index to Financial Statements", at page 16.
(a)3 Exhibits (numbered in accordance with Item 601 of Regulation
S-K):
Exhibit # Description
3.1 Articles of Incorporation, as amended
through April 24, 1986, and Bylaws of the Company:
Incorporated by reference to Exhibits 4(a) and 4(b)
from the Registration Statement of the Company filed
with the SEC on Form S-3 (Commission file no. 33-
7245).
3.2 Articles of Amendment to the Articles of
Incorporation, dated April 22, 1987: Incorporated by
reference to Exhibit 3.2 to the Annual Report on Form
10-K for the period ended January 1, 1992 (Commission
file no. 0-10943) (the "1991 10-K").
3.3 Amendment to By-Laws of the Company, dated
October 25, 1990: Incorporated by reference to
Exhibit 3.3 to the 1991 10-K.
3.4 Articles of Amendment to the Articles of
Incorporation, dated May 25, 1989: Incorporated by
reference to Exhibit 4.3 to the Registration
Statement of the Company filed with the SEC on Form S-
8 (Commission file no. 33-53834).
4.1 Specimen of Company common stock
certificate: Incorporated by reference to Exhibit
4.1 to the 1991 10-K.
4.2 See Exhibits 3.1, 3.2, 3.3, 3.4 and 4.1.
4.3 See Exhibit 10.18.
*10.1 Ryan's Family Steak Houses, Inc. Incentive
Stock Option Plan: Incorporated by reference to the
Registration Statement of the Company filed with the
SEC on Form S-8 (Commission file no. 2-83987).
*10.2 Ryan's Family Steak Houses, Inc. 1987
Stock Option Plan: Incorporated by reference to
Exhibit 4 to the Registration Statement of the
Company filed with the SEC on Form S-8 (Commission
file no. 33-15924).
*10.3 Ryan's Family Steak Houses, Inc. 1991
Stock Option Plan: Incorporated by reference to
Exhibit 4.4 to the Registration Statement of the
Company filed with the SEC on Form S-8 (Commission
file no. 33-53834).
*10.4 Ryan's Family Steak Houses, Inc. 1998
Stock Option Plan: Incorporated by reference to
Exhibit A to the Proxy Statement of the Company,
dated March 27, 1998, filed with respect to the
Annual Meeting of Shareholders to be held on April
30, 1998 (Commission file no. 0-10943).
*10.5 Ryan's Employee Retirement Savings Plan,
dated March 1, 1992: Incorporated by reference to
Exhibit 10.4 to the 1991 10-K.
*10.6 Salary Continuation Agreement, dated April
22, 1987, between the Company and Alvin A. McCall,
Jr.; as amended on October 26, 1989: Incorporated by
reference to Exhibit 10.5 to the 1991 10-K.
*10.7 Deferred Compensation - Salary
Continuation Agreement, dated April 22, 1987, between
the Company and Charles D. Way: Incorporated by
reference to Exhibit 10.6 to the 1991 10-K.
*10.8 Agreement and Plan of Restructuring:
Incorporated by reference to Exhibit A to the Proxy
Statement of the Company, dated March 25, 1993, filed
with respect to the Annual Meeting of Shareholders to
be held on April 28, 1993 (Commission file no. 0-
10943).
*10.9 Split Dollar Agreement by and between the
Company and Charles D. Way dated September 1, 1993:
Incorporated by reference to Exhibit 10.8 to the
Annual Report on Form 10-K for the period ended
December 29, 1993 (Commission file no. 0-10943) (the
"1993 10-K").
*10.10 Split Dollar Agreement by and between the
Company and G. Edwin McCranie dated November 12,
1993: Incorporated by reference to Exhibit 10.9 to
the 1993 10-K.
*10.11 Split Dollar Agreement by and between the
Company and John C. Jamison dated November 12, 1993:
Incorporated by reference to Exhibit 10.10 to the
1993 10-K.
*10.12 Split Dollar Agreement by and between the
Company and James R. Hart dated August 8, 1993:
Incorporated by reference to Exhibit 10.11 to the
1993 10-K.
*10.13 Split Dollar Agreement by and between the
Company and Fred T. Grant, Jr. dated November 12,
1993: Incorporated by reference to Exhibit 10.12 to
the 1993 10-K.
*10.14 Split Dollar Agreement by and between the
Company and Alan E. Shaw dated November 12, 1993:
Incorporated by reference to Exhibit 10.13 to the
1993 10-K.
*10.15 Split Dollar Agreement by and between the
Company and Morgan A. Graham dated November 12, 1993.
*10.16 Split Dollar Agreement by and between the
Company and Janet J. Gleitz dated November 12, 1993.
*10.17 Split Dollar Agreement by and between the
Company and Ilene T. Turbow dated November 12, 1995.
*10.18 Deferred Compensation Plan by and between
the Company and Morgan A. Graham dated November 1,
1997.
*10.19 Deferred Compensation Plan by and between
the Company and Janet J. Gleitz dated November 1,
1997.
*10.20 Deferred Compensation Plan by and between
the Company and Ilene T. Turbow dated November 1,
1997.
*10.21 Executive Bonus Plan, commencing in 1994:
Incorporated by reference to Exhibit 10.14 to the
1993 10-K.
*10.22 Executive Bonus Plan, commencing in fiscal
year 1997: Incorporated by reference to Exhibit
10.15 to the Annual Report on Form 10-K for the
period ended January 1, 1997 (Commission file no. 0-
10943) (the "1996 10-K").
*10.23 Executive Bonus Plan, commencing in fiscal
year 1998.
10.24 Agreement between Ryan's Properties, Inc.
and Family Steak Houses of Florida, Inc. dated July
11, 1994 and as amended on October 17, 1994:
Incorporated by reference to Exhibit 10.15 to the
Annual Report on Form 10-K for the period ended
December 28, 1994 (Commission file no. 0-10943).
10.25 Ryan's Family Steak Houses, Inc. and
Wachovia Bank of North Carolina, N.A., as Rights
Agent, Shareholder Rights Agreement dated as of
January 26, 1995: Incorporated by reference to
Exhibit 2 to the report on Form 8-K filed with the
Commission on February 9, 1995 (Commission file no. 0-
10943).
10.26 Credit Agreement dated as of June 5, 1996
among Ryan's Family Steak Houses, Inc., Wachovia Bank
of Georgia, N.A., as Agent, and certain other banks:
Incorporated by reference to Exhibit 10.18 to the
1996 10-K.
13.1 Ryan's Family Steak Houses, Inc. 1997
Report to Shareholders.
21.1 Subsidiaries of the Company.
23.1 Consent of Independent Auditors' with
respect to Form S-8.
27 Financial Data Schedule (electronic filing
only).
99.1 Ryan's Family Steak Houses, Inc. Proxy
Statement for the Annual Meeting of Shareholders,
dated March 27, 1998.
* This is a management contract or
compensatory plan or arrangement.
(b) On October 6, 1997, November 10, 1997 and December 8, 1997,
the Company filed reports on Form 8-K regarding sales
information for September 1997, October 1997 and November
1997, respectively.
(c) The response to this portion of Item 14 is submitted as a
separate section of this report.
(d) The response to this portion of Item 14 is submitted as a
separate section of this report.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.
RYAN'S FAMILY STEAK HOUSES, INC.
March 27, 1998
By:/s/Fred T. Grant, Jr.
Fred T. Grant, Jr.
Vice President - Finance,
Treasurer and Assistant
Secretary (Principal
Financial and Accounting
Officer)
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated.
Signature Title Date
/s/Charles D. Way Chairman, President and March 27, 1998
Charles D. Way Chief Executive Officer
/s/G. Edwin McCranie Director and Executive March 27, 1998
G. Edwin McCranie Vice President
/s/James D. Cockman Director March 27, 1998
James D. Cockman
/s/Barry L. Edwards Director March 27, 1998
Barry L. Edwards
/s/Brian S. MacKenzie Director March 27, 1998
Brian S. MacKenzie
/s/Harold K. Roberts, Jr. Director March 27, 1998
Harold K. Roberts, Jr.
/s/James M. Shoemaker, Jr. Director March 27, 1998
James M. Shoemaker, Jr.
/s/Fred T. Grant, Jr. Vice President - Finance, March 27, 1998
Fred T. Grant, Jr. Treasurer and Assistant
Secretary (Principal Financial
and Accounting Officer)
RYAN'S FAMILY STEAK HOUSES, INC.
INDEX TO FINANCIAL STATEMENTS
The following financial statements of the Registrant included in
the Annual Report to Shareholders for the year ended December 31,
1997, are incorporated herein by reference. With the exception of the
pages listed below and other information incorporated in this report
on Form 10-K, the 1997 Annual Report to Shareholders is not deemed
"filed" as part of this report.
Page Reference
in Annual Report
Independent Auditors' Report 21
Consolidated Statements of Earnings 11
Consolidated Balance Sheets 12
Consolidated Statements of Cash Flows 13
Notes to Financial Statements 14-21
All financial statement schedules have been omitted since the
required information is not applicable or the information required is
included in the consolidated financial statements or the notes
thereto.
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> DEC-31-1998
<CASH> 289
<SECURITIES> 0
<RECEIVABLES> 2,965
<ALLOWANCES> 209
<INVENTORY> 4,294
<CURRENT-ASSETS> 12,089
<PP&E> 617,736
<DEPRECIATION> 137,204
<TOTAL-ASSETS> 495,554
<CURRENT-LIABILITIES> 64,852
<BONDS> 93,000
0
0
<COMMON> 46,978
<OTHER-SE> 270,083
<TOTAL-LIABILITY-AND-EQUITY> 495,554
<SALES> 599,169
<TOTAL-REVENUES> 601,931
<CGS> 408,456
<TOTAL-COSTS> 534,962
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 5,867
<INCOME-PRETAX> 61,102
<INCOME-TAX> 21,892
<INCOME-CONTINUING> 39,210
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 39,210
<EPS-BASIC> 0.83
<EPS-DILUTED> 0.82
</TABLE>
Exhibit 23.1
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Ryan's Family Steak Houses, Inc.:
We consent to incorporation by reference in the Registration Statement
(No. 0-10943) on Form S-8 of Ryan's Family Steak Houses, Inc. and
subsidiaries of our report dated January 21, 1998, relating to the
consolidated balance sheets of Ryan's Family Steak Houses, Inc. as of
December 31, 1997 and January 1, 1997, and the related consolidated
statements of earnings and cash flows for each of the years in the
three-year period ended December 31, 1997, which report is
incorporated by reference in the 1997 annual report on Form 10-K of
Ryan's Family Steak Houses, Inc.
/s/KPMG Peat Marwick LLP
Greenville, South Carolina
March 27, 1998
Exhibit 21.1
RYAN'S FAMILY STEAK HOUSES, INC.
SUBSIDIARIES OF THE COMPANY
AS OF MARCH 27, 1998
Jurisdiction of % of Stock
Name of Subsidiary Incorporation Owned by Parent Status
1. Big R Procurement
Company, Inc. DE 100% Active
2. Caliente Grille, Inc. DE 100% Active
3. Italian Eateries, Inc. DE 100% Active
4. L-1 Beverage Club, Inc. TX 100% Active
5. Laredo Grill, Inc. DE 100% Active
6. Ryan's Family Steak
Houses East, Inc. DE 100% Active
7. Ryan's Properties, Inc. DE 100% Active
8. Ry-Tex Beverage Corporation TX 100% Active
9. Ryan's Capital Holding
Corporation DE 100% Inactive
Exhibit 10.23
RYAN'S
1998 EXECUTIVE BONUS PLAN
OBJECTIVES:
Encourage team building and working together toward
common goals
Communicate key organizational goals
Focus the efforts and attention on the management team
Should reward only excellent/superior performance levels
Should be highly leveraged (20% - 50%)
Annual payment of bonuses
ELIGIBILITY REQUIREMENTS
Corporate Level Officer Based Plan
8 of the 9 Officers Are Covered By This Plan
(Alan Shaw Already Participates in a Separate Plan)
LEVEL OF BONUS AMOUNT
As a Percentage of Base Pay
Target Level Varies Based Upon Performance
PERFORMANCE MEASURES
PLAN WITH DEPARTMENTAL OBJECTIVES:
Approximately 2/3 of Bonus From Company Objectives for 7
Executives:
Ed McCranie Jack Jamison
Morgan Graham Randy Hart
Ilene Turbow Fred Grant
Janet Gleitz
Approximately 1/3 of Bonus From Departmental/Personal
Objectives:
Quantitative and Qualitative Objectives
Participants' Suggestions for Objectives
Approval of Pre-established Measures by CEO
Attached Point System to Determine Extent of Bonus
PLAN WITHOUT DEPARTMENTAL OBJECTIVES:
100 % of Bonus From Company Objectives for 1 Executive
Charlie Way
Attached point system to determine extent of bonus
Individual executive officers'
target bonus level information
has been omitted pursuant to
Instruction 1 to Item 601(b) (10)
of Regulation S-K promulgated
under the Securities Exchange Act of 1934
as amended.
Exhibit 10.15
SPLIT DOLLAR AGREEMENT
THIS AGREEMENT made and entered into effective the 12th day
of November, 1993, by and between RYAN'S FAMILY STEAK HOUSES, INC.
of the City of Greer, State of South Carolina (hereinafter called
"the Corporation") and MORGAN A. GRAHAM a resident of Greenville
County, State of South Carolina (hereinafter called "the
Employee").
WHEREAS, the Employee wants to insure his life, for the
benefit and protection of his family, under a policy to be issued
by Massachusetts Life Insurance Company; and
WHEREAS, the Corporation wants to help the Employee
provide insurance for the benefit and protection of his family by
paying the full amount of the premiums due on the policy on the
Employee's life; and
WHEREAS, the Corporation wants to be the owner of the
policy of insurance on the Employee's life acquired pursuant to
the terms of this Agreement so that it will have security for the
repayment of the amounts which it will pay on the premiums due on
the policy;
NOW, THEREFORE, in consideration of the mutual covenants
contained herein, it is agreed between the parties hereto as
follows:
1
ARTICLE 1
Application for Insurance. The Corporation will apply
to Massachusetts Mutual Life Insurance Company for a Whole Life
policy on the Employee's life in the face amount of Eight Hundred
Forty Five Thousand ($845,000) Dollars. The Corporation and the
Employee will do everything necessary to cause the policy to be
issued. When the policy is issued, the policy number, face amount
and plan of insurance shall be recorded on Schedule A attached
hereto and the policy shall then be subject to the terms of this
Agreement.
ARTICLE 2
Ownership of Insurance. The Corporation will be the
owner of the policy on the Employee's life acquired pursuant to
the terms of this Agreement and it may exercise all the rights of
ownership with respect to the policy except as otherwise
hereinafter provided.
ARTICLE 3
Designation of Beneficiaries and Election of Settlement
Option. The Corporation, upon receipt of a written request from
the Employee, will designate the person or persons named by the
Employee as beneficiaries to receive any proceeds payable under
the policy upon the Employee's life in excess of the amount of the
proceeds payable to the Corporation under Article 10:B of this
Agreement. The Corporation will also elect the settlement option
requested by the Employee in writing. The beneficiary or
2
beneficiaries named upon request by the Employee and the
settlement option elected upon request by the Employee will not be
changed by the Corporation unless the Employee makes a written
request for such a change.
ARTICLE 4
Election of Dividend Option. All dividends declared by
Massachusetts Mutual Life Insurance Company on the policy on the
Employee's life acquired pursuant to the terms of this Agreement
shall be applied to purchase additional paid up insurance on the
life of the Employee.
ARTICLE 5
Payment of Premiums on Policy. On or before the due
date the Corporation will pay to Massachusetts Mutual Life
Insurance Company the full amount of each annual premium on the
policy on the Employee's life acquired pursuant to the terms of
this Agreement.
ARTICLE 6
Employee's Obligation to Corporation. The Employee
shall be obligated to repay to the Corporation the aggregate
amount paid by the Corporation, under Article 5 of this Agreement,
to Massachusetts Mutual Life Insurance Company as premiums on the
policy on the Employee's life acquired pursuant to the terms of
this Agreement. This obligation of the Employee to the
Corporation shall be payable as provided in Article 10 and Article
12 of this Agreement.
3
ARTICLE 7
Additional Policy Benefits and Riders. The Corporation
may add a rider to the policy on the Employee's life, acquired
pursuant to the terms of this Agreement, for its own benefit.
Upon written request made by the Employee the Corporation may add
a rider to the policy for the benefit of the Employee. Any
additional premium for any rider which is added to the policy
shall be paid by the party which will be entitled to receive the
proceeds of the rider.
ARTICLE 8
Corporation's Right to Make Policy Loans.
A. The Corporation shall have the right to obtain loans
secured by the policy on the Employee's life acquired pursuant to
the terms of this Agreement. These loans may be obtained either
from Massachusetts Mutual Life Insurance Company or from others.
The Corporation shall have the right to assign the policy which it
owns on the Employee's life as security for the repayment of such
loans. The amount of such loans together with the interest
thereon shall at no time exceed the aggregate amount of the
premiums for the policy as of the date to which such premiums have
been paid. All interest charges with respect to any such loans
shall be paid by the Corporation.
B. If the policy on the Employee's life acquired
pursuant to the terms of this Agreement is assigned or encumbered
in any way, other than by a policy loan, on the date of the
4
Employee's death, the Corporation will promptly take all the steps
which may be necessary to secure a release or discharge of the
assignment or encumbrance so that the portion of the death
proceeds payable under the policy to the beneficiary or
beneficiaries named by the Employee will be paid promptly.
ARTICLE 9
Assignment or Termination of Policy. Except as
otherwise herein provided, the Corporation agrees that while this
Agreement remains in force and in effect, it will not, without the
Employee's consent, transfer, assign or terminate the policy on
the Employee's life acquired pursuant to the terms of this
Agreement.
ARTICLE 10
Death Claims.
A. When the Employee dies, the Corporation will
promptly take all the steps which may be necessary to obtain the
death benefits provided under the policy on the Employee's life
acquired pursuant to the terms of this Agreement.
B. When the Employee dies, the Corporation shall be
entitled to receive a portion of the death benefits provided under
the policy on the Employee's life acquired pursuant to the terms
of this Agreement. The amount to which the Corporation will be
entitled shall be the total amount which it has paid, pursuant to
Article 5 of this Agreement, as premiums on the policy on the
Employee's life less the amount of any indebtedness
5
which may exist against the policy and any interest due on such
indebtedness. The receipt of this amount by the Corporation shall
constitute satisfaction of the Employee's obligation under Article
6 of this Agreement.
C. When the Employee dies, the beneficiary or
beneficiaries named by the Corporation upon the Employee's request
shall be entitled to receive the amount of the death benefits
provided under the policy on the Employee's life in excess of the
amount payable to the Corporation under paragraph B of this
Article. This amount shall be paid under the settlement option
elected by the Corporation upon the Employee's request.
ARTICLE 11
Termination of Agreement. This Agreement shall
terminate on the occurrence of any of the following events:
(a) cessation of the Corporate business;
(b) bankruptcy, receivership or dissolution of the
Corporation;
(c) termination of the Employee's employment with the
Corporation for any reason whatsoever, whether voluntary or
involuntary; however, in the event the Employee works for the
Corporation until his age sixty-seven (67), then and in such sole
event, this Agreement shall not terminate upon his retirement but
shall continue until December 11, 2005.
(d) after the fifth year of this Agreement, November
12, 1998, the Corporation will transfer ownership of this policy
6
on the Employee's life to the Employee, or his written designee,
at which time all of the Employee's obligations to the
Corporation, as determined under Article 5 of this Agreement,
shall be secured by a collateral assignment duly executed by the
Employee, or his written designee, to the Corporation of an
interest in the policy equal to such obligation of the Employee.
(e) repayment in full by the Employee of the amount paid
by the Corporation, under Article 5 of this Agreement, as premiums
on the policy on the Employee's life, acquired pursuant to the
terms of this Agreement, provided that upon the receipt of such
repayment, the Corporation transfers ownership of the policy to
the Employee.
ARTICLE 12
Disposition of Policy on Termination of Agreement. If this
Agreement is terminated under paragraph (a), (b), or (c) of
Article 11, the Employee shall have sixty days in which to pay the
Corporation the amount which it has paid as premiums on the policy
on the Employee's life acquired pursuant to the terms of this
Agreement. Upon payment of this amount to the Corporation, the
Employee shall be entitled to obtain ownership of the policy on
his life. If the policy is encumbered by a policy loan at the
time ownership is to be transferred to the Employee, the
Corporation shall either remove the encumbrance or reduce the
price to be paid by the Employee for the policy by the amount of
the indebtedness. If the policy is assigned to a third party at
7
the time ownership is to be transferred to the Employee, the
Corporation shall take all the steps necessary to secure a release
of the assignment. If the Employee does not exercise his right to
acquire the policy, ownership of the policy by the Corporation
shall constitute satisfaction of the Employee's obligation to the
Corporation under Article 6 of this Agreement and the Employee
shall be discharged completely from his obligation to repay the
amounts paid by the Corporation upon the premiums due on the
policy.
ARTICLE 13
Insurance Company Not a Party. The Massachusetts Mutual
Life Insurance Company:
(a) shall not be deemed to be a party to this Agreement
for any purpose nor in any way responsible for its validity;
(b) shall not be obligated to inquire as to the
distribution of any monies payable or paid by it under the policy
on the Employee's life acquired pursuant to the terms of this
Agreement.
(c) shall be fully discharged from any and all
liability under the terms of any policy issued by it, which is
subject to the terms of this Agreement, upon payment or other
performance of its obligations in accordance with the terms of
such policy.
8
ARTICLE 14
Amendment of Agreement. This Agreement shall not be
modified or amended except by a writing signed by the Corporation
and the Employee. This Agreement shall be binding upon the heirs,
administrators or executors and the successors and assigns of each
party to this Agreement.
ARTICLE 15
State Law. This Agreement shall be subject to and shall
be construed under the laws of the State of South Carolina.
IN WITNESS WHEREOF, the parties hereto have signed and
sealed this Agreement on the date above first written.
IN THE PRESENCE OF:
/s/Freida L. Dunlap /s/Morgan A. Graham
Morgan A. Graham
/s/Lisa D. Sales Employee
RYAN'S FAMILY STEAK
HOUSES, INC.
/s/Freida L. Dunlap By:/s/Fred Grant, Jr.
/s/Lisa D. Sales And:/s/ Charles D. Way
9
Schedule A
Policy Number Type of Policy Face Amount
9-601-428 WHOLE LIFE $845,000
10
Exhibit 10.16
SPLIT DOLLAR AGREEMENT
THER AGREEMENT made and entered into effective the 12th day
of November, 1993, by and between RYAN'S FAMILY STEAK HOUSES, INC.
of the City of Greer, State of South Carolina (hereinafter called
"the Corporation") and JANET J. GLEITZ a resident of Greenville
County, State of South Carolina (hereinafter called "the
Employee").
WHEREAS, the Employee wants to insure her life, for the
benefit and protection of her family, under a policy to be issued
by Massachusetts Life Insurance Company; and
WHEREAS, the Corporation wants to help the Employee
provide insurance for the benefit and protection of her family by
paying the full amount of the premiums due on the policy on the
Employee's life; and
WHEREAS, the Corporation wants to be the owner of the
policy of insurance on the Employee's life acquired pursuant to
the terms of ther Agreement so that it will have security for the
repayment of the amounts which it will pay on the premiums due on
the policy;
NOW, THEREFORE, in consideration of the mutual covenants
contained herein, it is agreed between the parties hereto as
follows:
1
ARTICLE 1
Application for Insurance. The Corporation will apply
to Massachusetts Mutual Life Insurance Company for a Whole Life
policy on the Employee's life in the face amount of Four Hundred
Fifty Thousand ($450,000) Dollars. The Corporation and the
Employee will do everything necessary to cause the policy to be
issued. When the policy is issued, the policy number, face amount
and plan of insurance shall be recorded on Schedule A attached
hereto and the policy shall then be subject to the terms of the
Agreement.
ARTICLE 2
Ownership of Insurance. The Corporation will be the
owner of the policy on the Employee's life acquired pursuant to
the terms of ther Agreement and it may exercise all the rights of
ownership with respect to the policy except as otherwise
hereinafter provided.
ARTICLE 3
Designation of Beneficiaries and Election of Settlement
Option. The Corporation, upon receipt of a written request from
the Employee, will designate the person or persons named by the
Employee as beneficiaries to receive any proceeds payable under
the policy upon the Employee's life in excess of the amount of the
proceeds payable to the Corporation under Article 10:B of ther
Agreement. The Corporation will also elect the settlement option
requested by the Employee in writing. The beneficiary or
2
beneficiaries named upon request by the Employee and the
settlement option elected upon request by the Employee will not be
changed by the Corporation unless the Employee makes a written
request for such a change.
ARTICLE 4
Election of Dividend Option. All dividends declared by
Massachusetts Mutual Life Insurance Company on the policy on the
Employee's life acquired pursuant to the terms of ther Agreement
shall be applied to purchase additional paid up insurance on the
life of the Employee.
ARTICLE 5
Payment of Premiums on Policy. On or before the due
date the Corporation will pay to Massachusetts Mutual Life
Insurance Company the full amount of each annual premium on the
policy on the Employee's life acquired pursuant to the terms of
ther Agreement.
ARTICLE 6
Employee's Obligation to Corporation. The Employee
shall be obligated to repay to the Corporation the aggregate
amount paid by the Corporation, under Article 5 of ther Agreement,
to Massachusetts Mutual Life Insurance Company as premiums on the
policy on the Employee's life acquired pursuant to the terms of
ther Agreement. Ther obligation of the Employee to the
Corporation shall be payable as provided in Article 10 and Article
12 of ther Agreement.
3
ARTICLE 7
Additional Policy Benefits and Riders. The Corporation
may add a rider to the policy on the Employee's life, acquired
pursuant to the terms of ther Agreement, for its own benefit.
Upon written request made by the Employee the Corporation may add
a rider to the policy for the benefit of the Employee. Any
additional premium for any rider which is added to the policy
shall be paid by the party which will be entitled to receive the
proceeds of the rider.
ARTICLE 8
Corporation's Right to Make Policy Loans.
A. The Corporation shall have the right to obtain loans
secured by the policy on the Employee's life acquired pursuant to
the terms of ther Agreement. These loans may be obtained either
from Massachusetts Mutual Life Insurance Company or from others.
The Corporation shall have the right to assign the policy which it
owns on the Employee's life as security for the repayment of such
loans. The amount of such loans together with the interest
thereon shall at no time exceed the aggregate amount of the
premiums for the policy as of the date to which such premiums have
been paid. All interest charges with respect to any such loans
shall be paid by the Corporation.
B. If the policy on the Employee's life acquired
pursuant to the terms of ther Agreement is assigned or encumbered
in any way, other than by a policy loan, on the date of the
4
Employee's death, the Corporation will promptly take all the steps
which may be necessary to secure a release or discharge of the
assignment or encumbrance so that the portion of the death
proceeds payable under the policy to the beneficiary or
beneficiaries named by the Employee will be paid promptly.
ARTICLE 9
Assignment or Termination of Policy. Except as
otherwise herein provided, the Corporation agrees that while ther
Agreement remains in force and in effect, it will not, without the
Employee's consent, transfer, assign or terminate the policy on
the Employee's life acquired pursuant to the terms of ther
Agreement.
ARTICLE 10
Death Claims.
A. When the Employee dies, the Corporation will
promptly take all the steps which may be necessary to obtain the
death benefits provided under the policy on the Employee's life
acquired pursuant to the terms of ther Agreement.
B. When the Employee dies, the Corporation shall be
entitled to receive a portion of the death benefits provided under
the policy on the Employee's life acquired pursuant to the terms
of ther Agreement. The amount to which the Corporation will be
entitled shall be the total amount which it has paid, pursuant to
Article 5 of ther Agreement, as premiums on the policy on the
Employee's life less the amount of any indebtedness
5
which may exist against the policy and any interest due on such
indebtedness. The receipt of ther amount by the Corporation shall
constitute satisfaction of the Employee's obligation under Article
6 of ther Agreement.
C. When the Employee dies, the beneficiary or
beneficiaries named by the Corporation upon the Employee's request
shall be entitled to receive the amount of the death benefits
provided under the policy on the Employee's life in excess of the
amount payable to the Corporation under paragraph B of ther
Article. Ther amount shall be paid under the settlement option
elected by the Corporation upon the Employee's request.
ARTICLE 11
Termination of Agreement. Ther Agreement shall
terminate on the occurrence of any of the following events:
(a) cessation of the Corporate business;
(b) bankruptcy, receivership or dissolution of the
Corporation;
(c) termination of the Employee's employment with the
Corporation for any reason whatsoever, whether voluntary or
involuntary; however, in the event the Employee works for the
Corporation until her age sixty-one (61), then and in such sole
event, ther Agreement shall not terminate upon her retirement but
shall continue until January 15, 2009.
(d) after the fifth year of ther Agreement, November
12, 1998, the Corporation will transfer ownership of ther policy
6
on the Employee's life to the Employee, or her written designee,
at which time all of the Employee's obligations to the
Corporation, as determined under Article 5 of ther Agreement,
shall be secured by a collateral assignment duly executed by the
Employee, or her written designee, to the Corporation of an
interest in the policy equal to such obligation of the Employee.
(e) repayment in full by the Employee of the amount paid
by the Corporation, under Article 5 of ther Agreement, as premiums
on the policy on the Employee's life, acquired pursuant to the
terms of ther Agreement, provided that upon the receipt of such
repayment, the Corporation transfers ownership of the policy to
the Employee.
ARTICLE 12
Disposition of Policy on Termination of Agreement. If ther
Agreement is terminated under paragraph (a), (b), or (c) of
Article 11, the Employee shall have sixty days in which to pay the
Corporation the amount which it has paid as premiums on the policy
on the Employee's life acquired pursuant to the terms of ther
Agreement. Upon payment of ther amount to the Corporation, the
Employee shall be entitled to obtain ownership of the policy on
her life. If the policy is encumbered by a policy loan at the
time ownership is to be transferred to the Employee, the
Corporation shall either remove the encumbrance or reduce the
price to be paid by the Employee for the policy by the amount of
the indebtedness. If the policy is assigned to a third party at
7
the time ownership is to be transferred to the Employee, the
Corporation shall take all the steps necessary to secure a release
of the assignment. If the Employee does not exercise her right to
acquire the policy, ownership of the policy by the Corporation
shall constitute satisfaction of the Employee's obligation to the
Corporation under Article 6 of ther Agreement and the Employee
shall be discharged completely from her obligation to repay the
amounts paid by the Corporation upon the premiums due on the
policy.
ARTICLE 13
Insurance Company Not a Party. The Massachusetts Mutual
Life Insurance Company:
(a) shall not be deemed to be a party to ther Agreement
for any purpose nor in any way responsible for its validity;
(b) shall not be obligated to inquire as to the
distribution of any monies payable or paid by it under the policy
on the Employee's life acquired pursuant to the terms of ther
Agreement.
(c) shall be fully discharged from any and all
liability under the terms of any policy issued by it, which is
subject to the terms of ther Agreement, upon payment or other
performance of its obligations in accordance with the terms of
such policy.
8
ARTICLE 14
Amendment of Agreement. Ther Agreement shall not be
modified or amended except by a writing signed by the Corporation
and the Employee. Ther Agreement shall be binding upon the heirs,
administrators or executors and the successors and assigns of each
party to ther Agreement.
ARTICLE 15
State Law. Ther Agreement shall be subject to and shall
be construed under the laws of the State of South Carolina.
IN WITNESS WHEREOF, the parties hereto have signed and
sealed ther Agreement on the date above first written.
IN THE PRESENCE OF:
/s/Freida L. Dunlap /s/Janet J. Gleitz
Janet J. Gleitz
/s/Lisa D. Sales Employee
RYAN'S FAMILY STEAK
HOUSES, INC.
/s/Freida L. Dunlap By:/s/Fred T. Grant, Jr.
/s/Lisa D. Sales And:/s/Charles D. Way
9
Schedule A
Policy Number Type of Policy Face Amount
9-601-411 WHOLE LIFE $450,000
10
Exhibit 10.17
SPLIT DOLLAR AGREEMENT
THER AGREEMENT made and entered into effective the 12th day
of November, 1993, by and between RYAN'S FAMILY STEAK HOUSES, INC.
of the City of Greer, State of South Carolina (hereinafter called
"the Corporation") and ILENE T. TURBOW a resident of Greenville
County, State of South Carolina (hereinafter called "the
Employee").
WHEREAS, the Employee wants to insure her life, for the
benefit and protection of her family, under a policy to be issued
by Massachusetts Life Insurance Company; and
WHEREAS, the Corporation wants to help the Employee
provide insurance for the benefit and protection of her family by
paying the full amount of the premiums due on the policy on the
Employee's life; and
WHEREAS, the Corporation wants to be the owner of the
policy of insurance on the Employee's life acquired pursuant to
the terms of ther Agreement so that it will have security for the
repayment of the amounts which it will pay on the premiums due on
the policy;
NOW, THEREFORE, in consideration of the mutual covenants
contained herein, it is agreed between the parties hereto as
follows:
1
ARTICLE 1
Application for Insurance. The Corporation will apply
to Massachusetts Mutual Life Insurance Company for a Whole Life
policy on the Employee's life in the face amount of Nine Hundred
Thirty Five Thousand ($935,000) Dollars. The Corporation and the
Employee will do everything necessary to cause the policy to be
issued. When the policy is issued, the policy number, face amount
and plan of insurance shall be recorded on Schedule A attached
hereto and the policy shall then be subject to the terms of the
Agreement.
ARTICLE 2
Ownership of Insurance. The Corporation will be the
owner of the policy on the Employee's life acquired pursuant to
the terms of ther Agreement and it may exercise all the rights of
ownership with respect to the policy except as otherwise
hereinafter provided.
ARTICLE 3
Designation of Beneficiaries and Election of Settlement
Option. The Corporation, upon receipt of a written request from
the Employee, will designate the person or persons named by the
Employee as beneficiaries to receive any proceeds payable under
the policy upon the Employee's life in excess of the amount of the
proceeds payable to the Corporation under Article 10:B of ther
Agreement. The Corporation will also elect the settlement option
requested by the Employee in writing. The beneficiary or
2
beneficiaries named upon request by the Employee and the
settlement option elected upon request by the Employee will not be
changed by the Corporation unless the Employee makes a written
request for such a change.
ARTICLE 4
Election of Dividend Option. All dividends declared by
Massachusetts Mutual Life Insurance Company on the policy on the
Employee's life acquired pursuant to the terms of ther Agreement
shall be applied to purchase additional paid up insurance on the
life of the Employee.
ARTICLE 5
Payment of Premiums on Policy. On or before the due
date the Corporation will pay to Massachusetts Mutual Life
Insurance Company the full amount of each annual premium on the
policy on the Employee's life acquired pursuant to the terms of
ther Agreement.
ARTICLE 6
Employee's Obligation to Corporation. The Employee
shall be obligated to repay to the Corporation the aggregate
amount paid by the Corporation, under Article 5 of ther Agreement,
to Massachusetts Mutual Life Insurance Company as premiums on the
policy on the Employee's life acquired pursuant to the terms of
ther Agreement. Ther obligation of the Employee to the
Corporation shall be payable as provided in Article 10 and Article
12 of ther Agreement.
3
ARTICLE 7
Additional Policy Benefits and Riders. The Corporation
may add a rider to the policy on the Employee's life, acquired
pursuant to the terms of ther Agreement, for its own benefit.
Upon written request made by the Employee the Corporation may add
a rider to the policy for the benefit of the Employee. Any
additional premium for any rider which is added to the policy
shall be paid by the party which will be entitled to receive the
proceeds of the rider.
ARTICLE 8
Corporation's Right to Make Policy Loans.
A. The Corporation shall have the right to obtain loans
secured by the policy on the Employee's life acquired pursuant to
the terms of ther Agreement. These loans may be obtained either
from Massachusetts Mutual Life Insurance Company or from others.
The Corporation shall have the right to assign the policy which it
owns on the Employee's life as security for the repayment of such
loans. The amount of such loans together with the interest
thereon shall at no time exceed the aggregate amount of the
premiums for the policy as of the date to which such premiums have
been paid. All interest charges with respect to any such loans
shall be paid by the Corporation.
B. If the policy on the Employee's life acquired
pursuant to the terms of ther Agreement is assigned or encumbered
in any way, other than by a policy loan, on the date of the
4
Employee's death, the Corporation will promptly take all the steps
which may be necessary to secure a release or discharge of the
assignment or encumbrance so that the portion of the death
proceeds payable under the policy to the beneficiary or
beneficiaries named by the Employee will be paid promptly.
ARTICLE 9
Assignment or Termination of Policy. Except as
otherwise herein provided, the Corporation agrees that while ther
Agreement remains in force and in effect, it will not, without the
Employee's consent, transfer, assign or terminate the policy on
the Employee's life acquired pursuant to the terms of ther
Agreement.
ARTICLE 10
Death Claims.
A. When the Employee dies, the Corporation will
promptly take all the steps which may be necessary to obtain the
death benefits provided under the policy on the Employee's life
acquired pursuant to the terms of ther Agreement.
B. When the Employee dies, the Corporation shall be
entitled to receive a portion of the death benefits provided under
the policy on the Employee's life acquired pursuant to the terms
of ther Agreement. The amount to which the Corporation will be
entitled shall be the total amount which it has paid, pursuant to
Article 5 of ther Agreement, as premiums on the policy on the
Employee's life less the amount of any indebtedness
5
which may exist against the policy and any interest due on such
indebtedness. The receipt of ther amount by the Corporation shall
constitute satisfaction of the Employee's obligation under Article
6 of ther Agreement.
C. When the Employee dies, the beneficiary or
beneficiaries named by the Corporation upon the Employee's request
shall be entitled to receive the amount of the death benefits
provided under the policy on the Employee's life in excess of the
amount payable to the Corporation under paragraph B of ther
Article. Ther amount shall be paid under the settlement option
elected by the Corporation upon the Employee's request.
ARTICLE 11
Termination of Agreement. Ther Agreement shall
terminate on the occurrence of any of the following events:
(a) cessation of the Corporate business;
(b) bankruptcy, receivership or dissolution of the
Corporation;
(c) termination of the Employee's employment with the
Corporation for any reason whatsoever, whether voluntary or
involuntary; however, in the event the Employee works for the
Corporation until her age sixty (60), then and in such sole event,
ther Agreement shall not terminate upon her retirement but shall
continue until December 22, 2014.
(d) after the fifth year of ther Agreement, November
12, 2000, the Corporation will transfer ownership of ther policy
6
on the Employee's life to the Employee, or her written designee,
at which time all of the Employee's obligations to the
Corporation, as determined under Article 5 of ther Agreement,
shall be secured by a collateral assignment duly executed by the
Employee, or her written designee, to the Corporation of an
interest in the policy equal to such obligation of the Employee.
(e) repayment in full by the Employee of the amount paid
by the Corporation, under Article 5 of ther Agreement, as premiums
on the policy on the Employee's life, acquired pursuant to the
terms of ther Agreement, provided that upon the receipt of such
repayment, the Corporation transfers ownership of the policy to
the Employee.
ARTICLE 12
Disposition of Policy on Termination of Agreement. If ther
Agreement is terminated under paragraph (a), (b), or (c) of
Article 11, the Employee shall have sixty days in which to pay the
Corporation the amount which it has paid as premiums on the policy
on the Employee's life acquired pursuant to the terms of ther
Agreement. Upon payment of ther amount to the Corporation, the
Employee shall be entitled to obtain ownership of the policy on
her life. If the policy is encumbered by a policy loan at the
time ownership is to be transferred to the Employee, the
Corporation shall either remove the encumbrance or reduce the
price to be paid by the Employee for the policy by the amount of
the indebtedness. If the policy is assigned to a third party at
7
the time ownership is to be transferred to the Employee, the
Corporation shall take all the steps necessary to secure a release
of the assignment. If the Employee does not exercise her right to
acquire the policy, ownership of the policy by the Corporation
shall constitute satisfaction of the Employee's obligation to the
Corporation under Article 6 of ther Agreement and the Employee
shall be discharged completely from her obligation to repay the
amounts paid by the Corporation upon the premiums due on the
policy.
ARTICLE 13
Insurance Company Not a Party. The Massachusetts Mutual
Life Insurance Company:
(a) shall not be deemed to be a party to ther Agreement
for any purpose nor in any way responsible for its validity;
(b) shall not be obligated to inquire as to the
distribution of any monies payable or paid by it under the policy
on the Employee's life acquired pursuant to the terms of ther
Agreement.
(c) shall be fully discharged from any and all
liability under the terms of any policy issued by it, which is
subject to the terms of ther Agreement, upon payment or other
performance of its obligations in accordance with the terms of
such policy.
8
ARTICLE 14
Amendment of Agreement. Ther Agreement shall not be
modified or amended except by a writing signed by the Corporation
and the Employee. Ther Agreement shall be binding upon the heirs,
administrators or executors and the successors and assigns of each
party to ther Agreement.
ARTICLE 15
State Law. Ther Agreement shall be subject to and shall
be construed under the laws of the State of South Carolina.
IN WITNESS WHEREOF, the parties hereto have signed and
sealed ther Agreement on the date above first written.
IN THE PRESENCE OF:
/s/Freida L. Dunlap /s/Ilene T. Turbow
Ilene T. Turbow
/s/Lisa D. Sales Employee
RYAN'S FAMILY STEAK
HOUSES, INC.
/s/Freida L. Dunlap By:/s/Fred T. Grant, Jr.
/s/Lisa D. Sales And:/s/Charles D. Way
9
Schedule A
Policy Number Type of Policy Face Amount
9-849-769 WHOLE LIFE $935,000
10
Exhibit 10.18
RYAN'S FAMILY STEAK HOUSES, INC.
DEFERRED COMPENSATION PLAN
FOR
MORGAN A. GRAHAM
Effective November 1, 1997
RYAN'S FAMILY STEAK HOUSES, INC.
DEFERRED COMPENSATION PLAN
FOR
MORGAN A. GRAHAM
TABLE OF CONTENTS
Page
ARTICLE I. REFERENCES, CONSTRUCTION AND DEFINITIONS 1
1.1 Benefit 1
1.2 Code 1
1.3 Company 1
1.4 Effective Date 2
1.5 Employee 2
1.6 ERISA 2
1.7 Named Fiduciary 2
1.8 Participant 2
1.9 Plan 2
1.10 Plan Administrator 2
1.11 Plan Year 2
1.12 Retirement 2
1.13 Termination of Service 2
1.14 Total Disability 2
ARTICLE II. ELIGIBILITY 2
2.1 Eligibility 2
ARTICLE III. BENEFITS 3
3.1 Benefit Upon Actual Retirement 3
3.2 Benefit Upon Other Termination of Service 3
3.3 Withholding Taxes 3
ARTICLE IV. VESTING 3
4.1 In General 3
4.2 Upon Total Disability 4
ARTICLE V. AMENDMENT AND TERMINATION 4
ARTICLE VI. CLAIMS PROCEDURE 4
6.1 Filing of a Claim for Benefits 4
6.2 Notification to Claimant of Decision 4
6.3 Procedure for Review 5
6.4 Decision on Review 5
6.5 Action by Authorized Representative of Claimant 6
ARTICLE X. MISCELLANEOUS 6
7.1 Nonalienation of Benefits 6
7.2 No Trust Created 6
7.3 No Employment Agreement 6
7.4 Funding Policy 7
7.5 Binding Effect 7
7.6 Entire Plan 7
7.7 Merger or Consolidation 7
7.8 Payment to Incompetent 7
7.9 No Contributions 7
RYAN'S FAMILY STEAK HOUSES, INC.
DEFERRED COMPENSATION PLAN
FOR
MORGAN A. GRAHAM
Preamble
The Company has established this Plan to contribute to its long-
range growth. It is the intention of the parties that the Plan be
unfunded for tax purposes and for purposes of Title I of ERISA.
Under the Plan, the Company has awarded a member of a select
group of key Employees with a deferred benefit. Such benefit is
payable by the Company to the Employee or his estate upon actual
retirement or other termination of employment. By providing a key
Employee with additional financial security, the Plan enables the
Company to attract and to retain superior key personnel and
provides an additional incentive to such Employee to continue to
make the Company prosperous.
ARTICLE I. REFERENCES, CONSTRUCTION AND DEFINITIONS
Unless otherwise indicated, all references to articles, sections
and subsections shall be to the Plan as set forth in this
agreement. The Plan and all rights thereunder shall be construed
and enforced in accordance with ERISA and, to the extent state
law is applicable, the laws of the State of South Carolina. The
article titles and the captions preceding sections and
subsections have been inserted solely as a matter of convenience
and in no way define or limit the scope or intent of any
provisions. Whenever used herein, the singular includes the
plural, the masculine includes the feminine. Whenever used herein
and capitalized, the following terms shall have the respective
meaning indicated unless the context plainly requires otherwise.
1.1 Benefit. The benefit payable to the Participant
pursuant to the provisions of Article III.
1.2 Code. The Internal Revenue Code of 1986, as now in
effect or as hereafter amended. All citations to sections of the
Code are to such sections as they may from time to time be
amended or renumbered.
1.3 Company. Ryan's Family Steak Houses, Inc. and any
successor thereof.
1.4 Effective Date. The Effective Date of this Plan is
November 1, 1997.
1.5 Employee. An individual in the service of the Company
if the relationship between him and the Company is the legal
relationship of employer and employee.
1.6 ERISA. The Employee Retirement Income Security Act of
1974, as now in effect or as hereafter amended. All citations to
sections of ERISA are to such sections as they may from time to
time be amended or renumbered.
1.7 Named Fiduciary. The Company.
1.8 Participant. Morgan A. Graham.
1.9 Plan. The Ryan's Deferred Compensation Plan for Morgan
A. Graham as contained herein and as may be amended from time to
time hereafter.
1.10 Plan Administrator. The Company.
1.11 Plan Year. The calendar year.
1.12 Retirement. Termination of employment after attaining
age 67.
1.13 Termination of Service. Termination of the
Participant's employment with the Company for any reason other
than Retirement.
1.14 Total Disability. A physical or mental condition under
which the Participant qualifies for disability benefits under the
long-term disability plan of the Company; provided, however, if
the Participant is not covered by such plan, the Participant
shall be Totally Disabled if he would have qualified for
disability benefits under the plan were he covered by the plan;
provided, further, if there is no such plan, the Participant
shall be Totally Disabled if by reason of sickness or injury the
Participant cannot, after 60 days following the expiration of any
sick pay to which the Participant may be entitled, perform each
of the material duties of the Participant's regular occupation as
the Company in the exercise of its sole and absolute discretion
shall determine based upon competent medical evidence
satisfactory to the Company.
ARTICLE II. ELIGIBILITY
2.1 Eligibility. No Employee who is not a member of the
"select group of management" or a "highly compensated employee,"
as defined in 201(2), 301(a)(3) and 401(a) of ERISA shall be
eligible to become a Participant.
ARTICLE III. BENEFITS
3.1 Benefit Upon Actual Retirement. When the Participant
shall actually retire from employment with the Company on or
after his 67th birthday, he shall receive a benefit equal to
Seventy Eight Thousand and no/100 Dollars ($78,000.00), payable
in two equal installments as follows: (a) $39,000 on the date of
actual retirement; and (b) $39,000 on the first anniversary of
actual retirement. If the Participant shall die on or after his
67th birthday but before actually retiring or before receiving
payment of the entire amount of such benefit, the unpaid portion
of such benefit shall be paid to the Participant's estate.
3.2 Benefit Upon Other Termination of Service. If the
Participant shall Terminate Service with the Company for any
reason (including death or disability), whether voluntarily or
involuntarily, at any time prior to his 67th birthday, he shall
be entitled to a benefit calculated as follows:
(a) the present value of $78,000, payable $39,000 on the
Participant's 67th birthday and $39,000 on the Participant's 68th
birthday shall be calculated. Such present value shall be
calculated, as of the date of Termination of Service, using as a
discount factor an interest rate equal to the "Wall Street Prime
Rate" on the date of Termination of Service. For purposes of the
foregoing, "Wall Street Prime Rate" shall mean the "prime rate"
in effect and as published in the Wall Street Journal under Money
Rates on the date of determination.
(b) the Participant's vested percentage, if any, calculated
pursuant to Article IV below, shall be multiplied times the
amount calculated in 3.2(a) above, and the product shall be paid
to the Participant in a single sum within sixty (60) days of his
termination of employment.
If the Participant shall die before receiving payment of the
benefit described in 3.2(b) above, such benefit shall be paid
to the Participant's estate.
3.3 Withholding Taxes. Any amounts paid to a Participant
shall be reduced by the amount of taxes required by law to be
withheld. The Company shall timely furnish the Participant with
the appropriate tax information form evidencing such payment and
the amount thereof.
ARTICLE IV. VESTING
4.1 In General.
Each Participant shall vest in a portion of his Benefit,
commencing on his 63rd birthday, according to following schedule:
Participant's Birthday Vested Percentage
prior to 63rd 0%
63rd 20%
64th 40%
65th 60%
66th 80%
67th 100%
If, as of the date of his Termination of Service, a Participant
is not fully vested in his Benefit, he shall forfeit the
nonvested portion.
4.2 Upon Total Disability.
In the event that the Participant shall become Totally Disabled
as provided in this Agreement, he shall be fully vested in his
Benefit without regard to the schedule provided in 4.1 above.
ARTICLE V. AMENDMENT AND TERMINATION
The Company reserves the right, at any time and from time to time
to amend or terminate the Plan; provided, however, no such
amendment or termination shall reduce the Participant's vested
Benefit as of the date of such amendment or termination.
ARTICLE VI. CLAIMS PROCEDURE
The following claims procedure shall apply with respect to
the Plan:
6.1 Filing of a Claim for Benefits. If a Participant or his
beneficiary (the "Claimant") believes that he is entitled to
benefits under the Plan which are not being paid to him, he shall
file a written claim therefor with the Plan Administrator.
6.2 Notification to Claimant of Decision. The following
provisions are part of this Plan and are intended to meet the
requirements of Part 5 of Title I of ERISA. Within 90 days after
receipt of a claim by the Plan Administrator (or within 180 days
if special circumstances require an extension of time), the Plan
Administrator shall notify the claimant of his decision with
regard to the claim. In the event of such special circumstances
requiring an extension of time, there shall be furnished to the
claimant prior to expiration of the initial 90-day period written
notice of the extension, which notice shall set forth the special
circumstances and the date by which the decision shall be
furnished. If such claim shall be wholly or partially denied,
notice thereof shall be in writing and worded in a manner
calculated to be understood by the claimant, and shall set forth:
(i) the specific reason or reasons for the denial; (ii) specific
reference to pertinent provisions of the Plan on which the denial
is based; (iii) a description of any additional material or
information necessary for the claimant to perfect the claim and
an explanation of why such material or information is necessary;
and (iv) an explanation of the procedure for review of the
denial. If the Plan Administrator fails to notify the claimant of
the decision in timely manner, the claim shall be deemed denied
as of the close of the initial 90-day period (or the close of the
extension period, if applicable).
6.3 Procedure for Review. Within 60 days following receipt
by the claimant of notice denying his claim in whole or in part
or, if such notice shall not be given, within 60 days following
the latest date on which such notice could have been timely
given, the claimant shall appeal denial of the claim by filing a
written application for review with the Plan Administrator.
Following such request for review, the Plan Administrator shall
fully and fairly review the decision denying the claim. Prior to
the decision of the Plan Administrator, the claimant shall be
given an opportunity to review pertinent documents and to submit
issues and comments in writing.
6.4 Decision on Review. The decision on review of a claim
denied in whole or in part by the Plan Administrator shall be
made in the following manner:
(a) Within 60 days following receipt by the Plan
Administrator of the request for review (or within 120 days if
special circumstances require an extension of time), the Plan
Administrator shall notify the claimant in writing of its
decision with regard to the claim. In the event of such special
circumstances requiring an extension of time, written notice of
the extension shall be furnished to the claimant prior to the
commencement of the extension. If the decision on review is not
furnished in a timely manner, the claim shall be deemed denied as
of the close of the initial 60-day period (or the close of the
extension period, if applicable).
(b) With respect to a claim that is denied in whole or
in part, the decision on review shall set forth specific reasons
for the decision, shall be written in a manner calculated to be
understood by the claimant, and shall cite specific references to
the pertinent plan provisions on which the decision is based.
(c) The decision of the Plan Administrator shall be
final and conclusive.
6.5 Action by Authorized Representative of Claimant. All
actions set forth in this Article VII to be taken by the claimant
may likewise be taken by a representative of the claimant duly
authorized by him to act in his behalf on such matters. The Plan
Administrator may require such evidence as it may reasonably deem
necessary or advisable of the authority to act of any such
representative.
ARTICLE VII. MISCELLANEOUS
7.1 Nonalienation of Benefits. No right or benefit under
the Plan shall be subject to anticipation, alienation, sale,
transfer, assignment, pledge, encumbrance, attachment,
garnishment or charge, and any attempt to anticipate, alienate,
sell, transfer, assign, pledge, encumber, attach, garnish or
charge any right or benefit under the Plan shall be void. No
right or benefit hereunder shall in any manner be liable for or
subject to the debts, contracts, liabilities or torts of the
person entitled to such benefit. If a Participant shall become
bankrupt, or attempt (voluntarily or involuntarily) to
anticipate, alienate, sell, transfer, assign, pledge, encumber,
or charge any right hereunder, or if any creditor shall attempt
to attach, garnish, levy on or otherwise alienate or affect the
right or benefit of any Participant, then such right or benefit
shall, in the discretion of the Company, cease and terminate, and
in such event, the Company may hold or apply the same, or any
part thereof, for the benefit of the Participant in such manner
and in such amounts and proportions as the Company may deem
proper.
7.2 No Trust Created. The Plan constitutes a mere promise
by the Company to make benefit payments in the future, and the
obligation of the Company to make payments hereunder shall
constitute a liability of the Company to the Participant. Such
payments shall be made from the general funds of the Company, and
the Company shall not be required to establish or maintain any
special or separate fund, or to purchase or acquire life
insurance on a Participant's life, or otherwise to segregate
assets to assure that such payments shall be made. The
Participant shall have no interest in any particular asset of the
Company by reason of the obligations hereunder, and the right of
any of them to receive payments under this Plan shall be merely
the right of a general unsecured creditor of the Company. Nothing
contained in the Plan shall create or be construed as creating a
trust of any kind or any other fiduciary relationship between the
Company and a Participant.
7.3 No Employment Agreement. Neither the execution of this
Plan nor any action taken by the Company pursuant to this Plan
shall be held or construed to confer on a Participant any legal
right to be continued as an employee of the Company. This Plan
shall not be deemed to constitute a contract of employment
between the Company and a Participant, nor shall any provision
herein restrict the right of any Participant to terminate his
employment with the Company.
7.4 Funding Policy. This Plan is unfunded, and benefits
shall be paid from the general assets of the Company. However,
the Company may reserve such funds, make such investments or
purchase such insurance policies as it may from time to time
choose to provide a source for payments under the Plan. The
Participant shall have no claim to any such funds, investments or
policies.
7.5 Binding Effect. The obligations incurred pursuant to
this Plan shall be binding upon and inure to the benefit of their
successors and assigns and the Participant.
7.6 Entire Plan. This document, and any written amendments
hereto signed by the parties, contain all of the terms and
provisions of the Plan and shall constitute the entire Plan, any
other alleged terms or provisions, oral or written, being of no
effect. This agreement may be amended or modified only by a
writing signed by the parties hereto.
7.7 Merger or Consolidation. In the event of a merger or a
consolidation of the Company with another corporation or entity,
or the acquisition of substantially all of the assets or
outstanding stock of the Company by another corporation or
entity, then and in such event the obligations and
responsibilities of such merged or acquired corporation under
this Plan shall be assumed by any such successor or acquiring
corporation or entity, and all of the rights, privileges and
benefits of the Participant shall continue.
7.8 Payment to Incompetent. Payments of benefits shall be
made directly to a Participant entitled thereof, or if such
Participant has been determined by a court of competent
jurisdiction to be mentally or physically incompetent, then
payment shall be made to the duly appointed guardian, conservator
or other authorized representative of such Participant. The
Company shall have the right to make payment directly to a
Participant until it has received actual notice of the physical
or mental incapacity of the Participant and notice of the
appointment of a duly authorized representative of his estate.
Any such payment to an authorized representative for the benefit
of a Participant shall be a complete discharge of all liability
of the Company herefor.
7.9 No Contributions. The Participant shall not be permitted
to make any contributions to this plan.
[signatures on the following page]
Executed November 1, 1997
Ryan's Family Steak Houses, Inc.
By: /s/Charles D. Way_
Its: President __
Participant:
/s/Morgan A. Graham
Morgan A. Graham
Exhibit 10.19
DEFERRED COMPENSATION PLAN
FOR
JANET J. GLEITZ
Effective November 1, 1997
RYAN'S FAMILY STEAK HOUSES, INC.
DEFERRED COMPENSATION PLAN
FOR
JANET J. GLEITZ
TABLE OF CONTENTS
Page
ARTICLE I. REFERENCES, CONSTRUCTION AND DEFINITIONS 1
1.1 Benefit 1
1.2 Code 1
1.3 Company 1
1.4 Effective Date 2
1.5 Employee 2
1.6 ERISA 2
1.7 Named Fiduciary 2
1.8 Participant 2
1.9 Plan 2
1.10 Plan Administrator 2
1.11 Plan Year 2
1.12 Retirement 2
1.13 Termination of Service 2
1.14 Total Disability 2
ARTICLE II. ELIGIBILITY 2
2.1 Eligibility 2
ARTICLE III. BENEFITS 3
3.1 Benefit Upon Actual Retirement 3
3.2 Benefit Upon Other Termination of Service 3
3.3 Withholding Taxes 3
ARTICLE IV. VESTING 3
4.1 In General 3
4.2 Upon Total Disability 4
ARTICLE V. AMENDMENT AND TERMINATION 4
ARTICLE VI. CLAIMS PROCEDURE 4
6.1 Filing of a Claim for Benefits 4
6.2 Notification to Claimant of Decision 4
6.3 Procedure for Review 5
6.4 Decision on Review 5
6.5 Action by Authorized Representative of Claimant 6
ARTICLE X. MISCELLANEOUS 6
7.1 Nonalienation of Benefits 6
7.2 No Trust Created 6
7.3 No Employment Agreement 6
7.4 Funding Policy 7
7.5 Binding Effect 7
7.6 Entire Plan 7
7.7 Merger or Consolidation 7
7.8 Payment to Incompetent 7
7.9 No Contributions 7
RYAN'S FAMILY STEAK HOUSES, INC.
DEFERRED COMPENSATION PLAN
FOR
JANET J. GLEITZ
Preamble
The Company has established this Plan to contribute to its long-
range growth. It is the intention of the parties that the Plan be
unfunded for tax purposes and for purposes of Title I of ERISA.
Under the Plan, the Company has awarded a member of a select
group of key Employees with a deferred benefit. Such benefit is
payable by the Company to the Employee or his estate upon actual
retirement or other termination of employment. By providing a key
Employee with additional financial security, the Plan enables the
Company to attract and to retain superior key personnel and
provides an additional incentive to such Employee to continue to
make the Company prosperous.
ARTICLE I. REFERENCES, CONSTRUCTION AND DEFINITIONS
Unless otherwise indicated, all references to articles, sections
and subsections shall be to the Plan as set forth in this
agreement. The Plan and all rights thereunder shall be construed
and enforced in accordance with ERISA and, to the extent state
law is applicable, the laws of the State of South Carolina. The
article titles and the captions preceding sections and
subsections have been inserted solely as a matter of convenience
and in no way define or limit the scope or intent of any
provisions. Whenever used herein, the singular includes the
plural, the masculine includes the feminine. Whenever used herein
and capitalized, the following terms shall have the respective
meaning indicated unless the context plainly requires otherwise.
1.1 Benefit. The benefit payable to the Participant
pursuant to the provisions of Article III.
1.2 Code. The Internal Revenue Code of 1986, as now in
effect or as hereafter amended. All citations to sections of the
Code are to such sections as they may from time to time be
amended or renumbered.
1.3 Company. Ryan's Family Steak Houses, Inc. and any
successor thereof.
1.4 Effective Date. The Effective Date of this Plan is
November 1, 1997.
1.5 Employee. An individual in the service of the Company
if the relationship between him and the Company is the legal
relationship of employer and employee.
1.6 ERISA. The Employee Retirement Income Security Act of
1974, as now in effect or as hereafter amended. All citations to
sections of ERISA are to such sections as they may from time to
time be amended or renumbered.
1.7 Named Fiduciary. The Company.
1.8 Participant. Janet J. Gleitz.
1.9 Plan. The Ryan's Deferred Compensation Plan for Janet
J. Gleitz as contained herein and as may be amended from time to
time hereafter.
1.10 Plan Administrator. The Company.
1.11 Plan Year. The calendar year.
1.12 Retirement. Termination of employment after attaining
age 61.
1.13 Termination of Service. Termination of the
Participant's employment with the Company for any reason other
than Retirement.
1.14 Total Disability. A physical or mental condition under
which the Participant qualifies for disability benefits under the
long-term disability plan of the Company; provided, however, if
the Participant is not covered by such plan, the Participant
shall be Totally Disabled if he would have qualified for
disability benefits under the plan were he covered by the plan;
provided, further, if there is no such plan, the Participant
shall be Totally Disabled if by reason of sickness or injury the
Participant cannot, after 60 days following the expiration of any
sick pay to which the Participant may be entitled, perform each
of the material duties of the Participant's regular occupation as
the Company in the exercise of its sole and absolute discretion
shall determine based upon competent medical evidence
satisfactory to the Company.
ARTICLE II. ELIGIBILITY
2.1 Eligibility. No Employee who is not a member of the
"select group of management" or a "highly compensated employee,"
as defined in 201(2), 301(a)(3) and 401(a) of ERISA shall be
eligible to become a Participant.
ARTICLE III. BENEFITS
3.1 Benefit Upon Actual Retirement. When the Participant
shall actually retire from employment with the Company on or
after his 61ST birthday, he shall receive a benefit equal to One
Hundred Thousand and no/100 Dollars ($100,000.00), payable in
five equal installments as follows: (a) $20,000 on the date of
actual retirement; (b) $20,000 on the first anniversary of actual
retirement; (c) $20,000 on the second anniversary of actual
retirement; (d) $20,000 on the third anniversary of actual
retirement; and (e) $20,000 on the fourth anniversary of actual
retirement. If the Participant shall die on or after his 61st
birthday but before actually retiring or before receiving payment
of the entire amount of such benefit, the unpaid portion of such
benefit shall be paid to the Participant's estate.
3.2 Benefit Upon Other Termination of Service. If the
Participant shall Terminate Service with the Company for any
reason (including death or disability), whether voluntarily or
involuntarily, at any time prior to his 61st birthday, he shall
be entitled to a benefit calculated as follows:
(a) the present value of $100,000, payable $20,000 on the
Participant's 61st birthday; $20,000 on the Participant's 62nd
birthday; $20,000 on the Participant's 63rd birthday; $20,000 on
the Participant's 64th birthday; and $20,000 on the Participant's
65th birthday shall be calculated. Such present value shall be
calculated, as of the date of Termination of Service, using as a
discount factor an interest rate equal to the "Wall Street Prime
Rate" on the date of Termination of Service. For purposes of the
foregoing, "Wall Street Prime Rate" shall mean the "prime rate"
in effect and as published in the Wall Street Journal under Money
Rates on the date of determination.
(b) the Participant's vested percentage, if any, calculated
pursuant to Article IV below, shall be multiplied times the
amount calculated in 3.2(a) above, and the product shall be paid
to the Participant in a single sum within sixty (60) days of his
termination of employment.
If the Participant shall die before receiving payment of the
benefit described in 3.2(b) above, such benefit shall be paid
to the Participant's estate.
3.3 Withholding Taxes. Any amounts paid to a Participant
shall be reduced by the amount of taxes required by law to be
withheld. The Company shall timely furnish the Participant with
the appropriate tax information form evidencing such payment and
the amount thereof.
ARTICLE IV. VESTING
4.1 In General.
Each Participant shall vest in a portion of his Benefit,
commencing on his 57th birthday, according to following schedule:
Participant's Birthday Vested Percentage
prior to 57th 0%
57th 20%
58th 40%
59th 60%
60th 80%
61st 100%
If, as of the date of his Termination of Service, a Participant
is not fully vested in his Benefit, he shall forfeit the
nonvested portion.
4.2 Upon Total Disability.
In the event that the Participant shall become Totally Disabled
as provided in this Agreement, he shall be fully vested in his
Benefit without regard to the schedule provided in 4.1 above.
ARTICLE V. AMENDMENT AND TERMINATION
The Company reserves the right, at any time and from time to time
to amend or terminate the Plan; provided, however, no such
amendment or termination shall reduce the Participant's vested
Benefit as of the date of such amendment or termination.
ARTICLE VI. CLAIMS PROCEDURE
The following claims procedure shall apply with respect to
the Plan:
6.1 Filing of a Claim for Benefits. If a Participant or his
beneficiary (the "Claimant") believes that he is entitled to
benefits under the Plan which are not being paid to him, he shall
file a written claim therefor with the Plan Administrator.
6.2 Notification to Claimant of Decision. The following
provisions are part of this Plan and are intended to meet the
requirements of Part 5 of Title I of ERISA. Within 90 days after
receipt of a claim by the Plan Administrator (or within 180 days
if special circumstances require an extension of time), the Plan
Administrator shall notify the claimant of his decision with
regard to the claim. In the event of such special circumstances
requiring an extension of time, there shall be furnished to the
claimant prior to expiration of the initial 90-day period written
notice of the extension, which notice shall set forth the special
circumstances and the date by which the decision shall be
furnished. If such claim shall be wholly or partially denied,
notice thereof shall be in writing and worded in a manner
calculated to be understood by the claimant, and shall set forth:
(i) the specific reason or reasons for the denial; (ii) specific
reference to pertinent provisions of the Plan on which the denial
is based; (iii) a description of any additional material or
information necessary for the claimant to perfect the claim and
an explanation of why such material or information is necessary;
and (iv) an explanation of the procedure for review of the
denial. If the Plan Administrator fails to notify the claimant of
the decision in timely manner, the claim shall be deemed denied
as of the close of the initial 90-day period (or the close of the
extension period, if applicable).
6.3 Procedure for Review. Within 60 days following receipt
by the claimant of notice denying his claim in whole or in part
or, if such notice shall not be given, within 60 days following
the latest date on which such notice could have been timely
given, the claimant shall appeal denial of the claim by filing a
written application for review with the Plan Administrator.
Following such request for review, the Plan Administrator shall
fully and fairly review the decision denying the claim. Prior to
the decision of the Plan Administrator, the claimant shall be
given an opportunity to review pertinent documents and to submit
issues and comments in writing.
6.4 Decision on Review. The decision on review of a claim
denied in whole or in part by the Plan Administrator shall be
made in the following manner:
(a) Within 60 days following receipt by the Plan
Administrator of the request for review (or within 120 days if
special circumstances require an extension of time), the Plan
Administrator shall notify the claimant in writing of its
decision with regard to the claim. In the event of such special
circumstances requiring an extension of time, written notice of
the extension shall be furnished to the claimant prior to the
commencement of the extension. If the decision on review is not
furnished in a timely manner, the claim shall be deemed denied as
of the close of the initial 60-day period (or the close of the
extension period, if applicable).
(b) With respect to a claim that is denied in whole or
in part, the decision on review shall set forth specific reasons
for the decision, shall be written in a manner calculated to be
understood by the claimant, and shall cite specific references to
the pertinent plan provisions on which the decision is based.
(c) The decision of the Plan Administrator shall be
final and conclusive.
6.5 Action by Authorized Representative of Claimant. All
actions set forth in this Article VII to be taken by the claimant
may likewise be taken by a representative of the claimant duly
authorized by him to act in his behalf on such matters. The Plan
Administrator may require such evidence as it may reasonably deem
necessary or advisable of the authority to act of any such
representative.
ARTICLE VII. MISCELLANEOUS
7.1 Nonalienation of Benefits. No right or benefit under
the Plan shall be subject to anticipation, alienation, sale,
transfer, assignment, pledge, encumbrance, attachment,
garnishment or charge, and any attempt to anticipate, alienate,
sell, transfer, assign, pledge, encumber, attach, garnish or
charge any right or benefit under the Plan shall be void. No
right or benefit hereunder shall in any manner be liable for or
subject to the debts, contracts, liabilities or torts of the
person entitled to such benefit. If a Participant shall become
bankrupt, or attempt (voluntarily or involuntarily) to
anticipate, alienate, sell, transfer, assign, pledge, encumber,
or charge any right hereunder, or if any creditor shall attempt
to attach, garnish, levy on or otherwise alienate or affect the
right or benefit of any Participant, then such right or benefit
shall, in the discretion of the Company, cease and terminate, and
in such event, the Company may hold or apply the same, or any
part thereof, for the benefit of the Participant in such manner
and in such amounts and proportions as the Company may deem
proper.
7.2 No Trust Created. The Plan constitutes a mere promise
by the Company to make benefit payments in the future, and the
obligation of the Company to make payments hereunder shall
constitute a liability of the Company to the Participant. Such
payments shall be made from the general funds of the Company, and
the Company shall not be required to establish or maintain any
special or separate fund, or to purchase or acquire life
insurance on a Participant's life, or otherwise to segregate
assets to assure that such payments shall be made. The
Participant shall have no interest in any particular asset of the
Company by reason of the obligations hereunder, and the right of
any of them to receive payments under this Plan shall be merely
the right of a general unsecured creditor of the Company. Nothing
contained in the Plan shall create or be construed as creating a
trust of any kind or any other fiduciary relationship between the
Company and a Participant.
7.3 No Employment Agreement. Neither the execution of this
Plan nor any action taken by the Company pursuant to this Plan
shall be held or construed to confer on a Participant any legal
right to be continued as an employee of the Company. This Plan
shall not be deemed to constitute a contract of employment
between the Company and a Participant, nor shall any provision
herein restrict the right of any Participant to terminate his
employment with the Company.
7.4 Funding Policy. This Plan is unfunded, and benefits
shall be paid from the general assets of the Company. However,
the Company may reserve such funds, make such investments or
purchase such insurance policies as it may from time to time
choose to provide a source for payments under the Plan. The
Participant shall have no claim to any such funds, investments or
policies.
7.5 Binding Effect. The obligations incurred pursuant to
this Plan shall be binding upon and inure to the benefit of their
successors and assigns and the Participant.
7.6 Entire Plan. This document, and any written amendments
hereto signed by the parties, contain all of the terms and
provisions of the Plan and shall constitute the entire Plan, any
other alleged terms or provisions, oral or written, being of no
effect. This agreement may be amended or modified only by a
writing signed by the parties hereto.
7.7 Merger or Consolidation. In the event of a merger or a
consolidation of the Company with another corporation or entity,
or the acquisition of substantially all of the assets or
outstanding stock of the Company by another corporation or
entity, then and in such event the obligations and
responsibilities of such merged or acquired corporation under
this Plan shall be assumed by any such successor or acquiring
corporation or entity, and all of the rights, privileges and
benefits of the Participant shall continue.
7.8 Payment to Incompetent. Payments of benefits shall be
made directly to a Participant entitled thereof, or if such
Participant has been determined by a court of competent
jurisdiction to be mentally or physically incompetent, then
payment shall be made to the duly appointed guardian, conservator
or other authorized representative of such Participant. The
Company shall have the right to make payment directly to a
Participant until it has received actual notice of the physical
or mental incapacity of the Participant and notice of the
appointment of a duly authorized representative of his estate.
Any such payment to an authorized representative for the benefit
of a Participant shall be a complete discharge of all liability
of the Company herefor.
7.9 No Contributions. The Participant shall not be permitted
to make any contributions to this plan.
[signatures on the following page]
Executed November 1, 1997
Ryan's Family Steak Houses, Inc.
By: Charles D. Way_
Its: President___
Participant:
/s/Janet J. Gleitz__
Janet J. Gleitz
Exhibit 10.20
RYAN'S FAMILY STEAK HOUSES, INC.
DEFERRED COMPENSATION PLAN
FOR
ILENE T. TURBOW
Effective November 1, 1997
RYAN'S FAMILY STEAK HOUSES, INC.
DEFERRED COMPENSATION PLAN
FOR
ILENE T. TURBOW
TABLE OF CONTENTS
Page
ARTICLE I. REFERENCES, CONSTRUCTION AND DEFINITIONS 1
1.1 Benefit 1
1.2 Code 1
1.3 Company 1
1.4 Effective Date 2
1.5 Employee 2
1.6 ERISA 2
1.7 Named Fiduciary 2
1.8 Participant 2
1.9 Plan 2
1.10 Plan Administrator 2
1.11 Plan Year 2
1.12 Retirement 2
1.13 Termination of Service 2
1.14 Total Disability 2
ARTICLE II. ELIGIBILITY 2
2.1 Eligibility 2
ARTICLE III. BENEFITS 3
3.1 Benefit Upon Actual Retirement 3
3.2 Benefit Upon Other Termination of Service 3
3.3 Withholding Taxes 3
ARTICLE IV. VESTING 3
4.1 In General 3
4.2 Upon Total Disability 4
ARTICLE V. AMENDMENT AND TERMINATION 4
ARTICLE VI. CLAIMS PROCEDURE 4
6.1 Filing of a Claim for Benefits 4
6.2 Notification to Claimant of Decision 4
6.3 Procedure for Review 5
6.4 Decision on Review 5
6.5 Action by Authorized Representative of Claimant 6
ARTICLE X. MISCELLANEOUS 6
7.1 Nonalienation of Benefits 6
7.2 No Trust Created 6
7.3 No Employment Agreement 6
7.4 Funding Policy 7
7.5 Binding Effect 7
7.6 Entire Plan 7
7.7 Merger or Consolidation 7
7.8 Payment to Incompetent 7
7.9 No Contributions 7
RYAN'S FAMILY STEAK HOUSES, INC.
DEFERRED COMPENSATION PLAN
FOR
ILENE T. TURBOW
Preamble
The Company has established this Plan to contribute to its long-
range growth. It is the intention of the parties that the Plan be
unfunded for tax purposes and for purposes of Title I of ERISA.
Under the Plan, the Company has awarded a member of a select
group of key Employees with a deferred benefit. Such benefit is
payable by the Company to the Employee or his estate upon actual
retirement or other termination of employment. By providing a key
Employee with additional financial security, the Plan enables the
Company to attract and to retain superior key personnel and
provides an additional incentive to such Employee to continue to
make the Company prosperous.
ARTICLE I. REFERENCES, CONSTRUCTION AND DEFINITIONS
Unless otherwise indicated, all references to articles, sections
and subsections shall be to the Plan as set forth in this
agreement. The Plan and all rights thereunder shall be construed
and enforced in accordance with ERISA and, to the extent state
law is applicable, the laws of the State of South Carolina. The
article titles and the captions preceding sections and
subsections have been inserted solely as a matter of convenience
and in no way define or limit the scope or intent of any
provisions. Whenever used herein, the singular includes the
plural, the masculine includes the feminine. Whenever used herein
and capitalized, the following terms shall have the respective
meaning indicated unless the context plainly requires otherwise.
1.1 Benefit. The benefit payable to the Participant
pursuant to the provisions of Article III.
1.2 Code. The Internal Revenue Code of 1986, as now in
effect or as hereafter amended. All citations to sections of the
Code are to such sections as they may from time to time be
amended or renumbered.
1.3 Company. Ryan's Family Steak Houses, Inc. and any
successor thereof.
1.4 Effective Date. The Effective Date of this Plan is
November 1, 1997.
1.5 Employee. An individual in the service of the Company
if the relationship between him and the Company is the legal
relationship of employer and employee.
1.6 ERISA. The Employee Retirement Income Security Act of
1974, as now in effect or as hereafter amended. All citations to
sections of ERISA are to such sections as they may from time to
time be amended or renumbered.
1.7 Named Fiduciary. The Company.
1.8 Participant. Ilene T. Turbow.
1.9 Plan. The Ryan's Deferred Compensation Plan for Ilene
T. Turbow as contained herein and as may be amended from time to
time hereafter.
1.10 Plan Administrator. The Company.
1.11 Plan Year. The calendar year.
1.12 Retirement. Termination of employment after attaining
age 60.
1.13 Termination of Service. Termination of the
Participant's employment with the Company for any reason other
than Retirement.
1.14 Total Disability. A physical or mental condition under
which the Participant qualifies for disability benefits under the
long-term disability plan of the Company; provided, however, if
the Participant is not covered by such plan, the Participant
shall be Totally Disabled if he would have qualified for
disability benefits under the plan were he covered by the plan;
provided, further, if there is no such plan, the Participant
shall be Totally Disabled if by reason of sickness or injury the
Participant cannot, after 60 days following the expiration of any
sick pay to which the Participant may be entitled, perform each
of the material duties of the Participant's regular occupation as
the Company in the exercise of its sole and absolute discretion
shall determine based upon competent medical evidence
satisfactory to the Company.
ARTICLE II. ELIGIBILITY
2.1 Eligibility. No Employee who is not a member of the
"select group of management" or a "highly compensated employee,"
as defined in 201(2), 301(a)(3) and 401(a) of ERISA shall be
eligible to become a Participant.
ARTICLE III. BENEFITS
3.1 Benefit Upon Actual Retirement. When the Participant
shall actually retire from employment with the Company on or
after his 60th birthday, he shall receive a benefit equal to One
Hundred Fifty Thousand and no/100 Dollars ($150,000.00), payable
in three equal installments as follows: (a) $50,000 on the date
of actual retirement; (b) $50,000 on the first anniversary of
actual retirement; and (c) $50,000 on the second anniversary of
actual retirement. If the Participant shall die on or after his
60th birthday but before actually retiring or before receiving
payment of the entire amount of such benefit, the unpaid portion
of such benefit shall be paid to the Participant's estate.
3.2 Benefit Upon Other Termination of Service. If the
Participant shall Terminate Service with the Company for any
reason (including death or disability), whether voluntarily or
involuntarily, at any time prior to his 60th birthday, he shall
be entitled to a benefit calculated as follows:
(a) the present value of $150,000, payable $50,000 on the
Participant's 60th birthday, $50,000 on the Participant's 61st
birthday and $50,000 on the Participant's 62nd birthday shall be
calculated. Such present value shall be calculated, as of the
date of Termination of Service, using as a discount factor an
interest rate equal to the "Wall Street Prime Rate" on the date
of Termination of Service. For purposes of the foregoing, "Wall
Street Prime Rate" shall mean the "prime rate" in effect and as
published in the Wall Street Journal under Money Rates on the
date of determination.
(b) the Participant's vested percentage, if any, calculated
pursuant to Article IV below, shall be multiplied times the
amount calculated in 3.2(a) above, and the product shall be paid
to the Participant in a single sum within sixty (60) days of his
termination of employment.
If the Participant shall die before receiving payment of the
benefit described in 3.2(b) above, such benefit shall be paid
to the Participant's estate.
3.3 Withholding Taxes. Any amounts paid to a Participant
shall be reduced by the amount of taxes required by law to be
withheld. The Company shall timely furnish the Participant with
the appropriate tax information form evidencing such payment and
the amount thereof.
ARTICLE IV. VESTING
4.1 In General.
Each Participant shall vest in a portion of his Benefit,
commencing on his 51st birthday, according to following schedule:
Participant's Birthday Vested Percentage
prior to 51st 0%
51st 10%
52nd 20%
53rd 30%
54th 40%
55th 50%
56th 60%
57th 70%
58th 80%
59th 90%
60th 100%
If, as of the date of his Termination of Service, a Participant
is not fully vested in his Benefit, he shall forfeit the
nonvested portion.
4.2 Upon Total Disability.
In the event that the Participant shall become Totally Disabled
as provided in this Agreement, he shall be fully vested in his
Benefit without regard to the schedule provided in 4.1 above.
ARTICLE V. AMENDMENT AND TERMINATION
The Company reserves the right, at any time and from time to time
to amend or terminate the Plan; provided, however, no such
amendment or termination shall reduce the Participant's vested
Benefit as of the date of such amendment or termination.
ARTICLE VI. CLAIMS PROCEDURE
The following claims procedure shall apply with respect to
the Plan:
6.1 Filing of a Claim for Benefits. If a Participant or his
beneficiary (the "Claimant") believes that he is entitled to
benefits under the Plan which are not being paid to him, he shall
file a written claim therefor with the Plan Administrator.
6.2 Notification to Claimant of Decision. The following
provisions are part of this Plan and are intended to meet the
requirements of Part 5 of Title I of ERISA. Within 90 days after
receipt of a claim by the Plan Administrator (or within 180 days
if special circumstances require an extension of time), the Plan
Administrator shall notify the claimant of his decision with
regard to the claim. In the event of such special circumstances
requiring an extension of time, there shall be furnished to the
claimant prior to expiration of the initial 90-day period written
notice of the extension, which notice shall set forth the special
circumstances and the date by which the decision shall be
furnished. If such claim shall be wholly or partially denied,
notice thereof shall be in writing and worded in a manner
calculated to be understood by the claimant, and shall set forth:
(i) the specific reason or reasons for the denial; (ii) specific
reference to pertinent provisions of the Plan on which the denial
is based; (iii) a description of any additional material or
information necessary for the claimant to perfect the claim and
an explanation of why such material or information is necessary;
and (iv) an explanation of the procedure for review of the
denial. If the Plan Administrator fails to notify the claimant of
the decision in timely manner, the claim shall be deemed denied
as of the close of the initial 90-day period (or the close of the
extension period, if applicable).
6.3 Procedure for Review. Within 60 days following receipt
by the claimant of notice denying his claim in whole or in part
or, if such notice shall not be given, within 60 days following
the latest date on which such notice could have been timely
given, the claimant shall appeal denial of the claim by filing a
written application for review with the Plan Administrator.
Following such request for review, the Plan Administrator shall
fully and fairly review the decision denying the claim. Prior to
the decision of the Plan Administrator, the claimant shall be
given an opportunity to review pertinent documents and to submit
issues and comments in writing.
6.4 Decision on Review. The decision on review of a claim
denied in whole or in part by the Plan Administrator shall be
made in the following manner:
(a) Within 60 days following receipt by the Plan
Administrator of the request for review (or within 120 days if
special circumstances require an extension of time), the Plan
Administrator shall notify the claimant in writing of its
decision with regard to the claim. In the event of such special
circumstances requiring an extension of time, written notice of
the extension shall be furnished to the claimant prior to the
commencement of the extension. If the decision on review is not
furnished in a timely manner, the claim shall be deemed denied as
of the close of the initial 60-day period (or the close of the
extension period, if applicable).
(b) With respect to a claim that is denied in whole or
in part, the decision on review shall set forth specific reasons
for the decision, shall be written in a manner calculated to be
understood by the claimant, and shall cite specific references to
the pertinent plan provisions on which the decision is based.
(c) The decision of the Plan Administrator shall be
final and conclusive.
6.5 Action by Authorized Representative of Claimant. All
actions set forth in this Article VII to be taken by the claimant
may likewise be taken by a representative of the claimant duly
authorized by him to act in his behalf on such matters. The Plan
Administrator may require such evidence as it may reasonably deem
necessary or advisable of the authority to act of any such
representative.
ARTICLE VII. MISCELLANEOUS
7.1 Nonalienation of Benefits. No right or benefit under
the Plan shall be subject to anticipation, alienation, sale,
transfer, assignment, pledge, encumbrance, attachment,
garnishment or charge, and any attempt to anticipate, alienate,
sell, transfer, assign, pledge, encumber, attach, garnish or
charge any right or benefit under the Plan shall be void. No
right or benefit hereunder shall in any manner be liable for or
subject to the debts, contracts, liabilities or torts of the
person entitled to such benefit. If a Participant shall become
bankrupt, or attempt (voluntarily or involuntarily) to
anticipate, alienate, sell, transfer, assign, pledge, encumber,
or charge any right hereunder, or if any creditor shall attempt
to attach, garnish, levy on or otherwise alienate or affect the
right or benefit of any Participant, then such right or benefit
shall, in the discretion of the Company, cease and terminate, and
in such event, the Company may hold or apply the same, or any
part thereof, for the benefit of the Participant in such manner
and in such amounts and proportions as the Company may deem
proper.
7.2 No Trust Created. The Plan constitutes a mere promise
by the Company to make benefit payments in the future, and the
obligation of the Company to make payments hereunder shall
constitute a liability of the Company to the Participant. Such
payments shall be made from the general funds of the Company, and
the Company shall not be required to establish or maintain any
special or separate fund, or to purchase or acquire life
insurance on a Participant's life, or otherwise to segregate
assets to assure that such payments shall be made. The
Participant shall have no interest in any particular asset of the
Company by reason of the obligations hereunder, and the right of
any of them to receive payments under this Plan shall be merely
the right of a general unsecured creditor of the Company. Nothing
contained in the Plan shall create or be construed as creating a
trust of any kind or any other fiduciary relationship between the
Company and a Participant.
7.3 No Employment Agreement. Neither the execution of this
Plan nor any action taken by the Company pursuant to this Plan
shall be held or construed to confer on a Participant any legal
right to be continued as an employee of the Company. This Plan
shall not be deemed to constitute a contract of employment
between the Company and a Participant, nor shall any provision
herein restrict the right of any Participant to terminate his
employment with the Company.
7.4 Funding Policy. This Plan is unfunded, and benefits
shall be paid from the general assets of the Company. However,
the Company may reserve such funds, make such investments or
purchase such insurance policies as it may from time to time
choose to provide a source for payments under the Plan. The
Participant shall have no claim to any such funds, investments or
policies.
7.5 Binding Effect. The obligations incurred pursuant to
this Plan shall be binding upon and inure to the benefit of their
successors and assigns and the Participant.
7.6 Entire Plan. This document, and any written amendments
hereto signed by the parties, contain all of the terms and
provisions of the Plan and shall constitute the entire Plan, any
other alleged terms or provisions, oral or written, being of no
effect. This agreement may be amended or modified only by a
writing signed by the parties hereto.
7.7 Merger or Consolidation. In the event of a merger or a
consolidation of the Company with another corporation or entity,
or the acquisition of substantially all of the assets or
outstanding stock of the Company by another corporation or
entity, then and in such event the obligations and
responsibilities of such merged or acquired corporation under
this Plan shall be assumed by any such successor or acquiring
corporation or entity, and all of the rights, privileges and
benefits of the Participant shall continue.
7.8 Payment to Incompetent. Payments of benefits shall be
made directly to a Participant entitled thereof, or if such
Participant has been determined by a court of competent
jurisdiction to be mentally or physically incompetent, then
payment shall be made to the duly appointed guardian, conservator
or other authorized representative of such Participant. The
Company shall have the right to make payment directly to a
Participant until it has received actual notice of the physical
or mental incapacity of the Participant and notice of the
appointment of a duly authorized representative of his estate.
Any such payment to an authorized representative for the benefit
of a Participant shall be a complete discharge of all liability
of the Company herefor.
7.9 No Contributions. The Participant shall not be permitted
to make any contributions to this plan.
[signatures on the following page]
Executed November 1, 1997
Ryan's Family Steak Houses, Inc.
By: /s/Charles D. Way
Its: _President____
Participant:
/s/Ilene T. Turbow
Ilene T. Turbow
