- Current report filing (8-K)
December 10 2008 - 6:02AM
Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 4, 2008
VCG Holding
Corp.
(Exact name of registrant as specified in its charter)
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Colorado
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001-32208
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84-1157022
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(State or other jurisdiction
of incorporation)
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(Commission
File Number)
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(IRS Employer
Identification Number)
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390 Union Boulevard, Suite 540
Lakewood, Colorado
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80228
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(Address of Principal Executive Offices)
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(Zip Code)
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(303) 934-2424
(Registrants telephone number, including area code)
(Former name or former address, if changed
since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions
(see General Instruction A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 5.02
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Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
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On December 4, 2008, VCG Holding Corp. (the Company) entered into five-year employment agreements with Troy Lowrie, the Companys
Chairman of the Board, Chief Executive Officer and a Director (the Lowrie Employment Agreement), and Micheal Ocello, the Companys President, Chief Operating Officer and a Director (the Ocello Employment Agreement). The
Lowrie Employment Agreement and the Ocello Employment Agreement are sometimes collectively referred to herein as the Employment Agreements. The Lowrie Employment Agreement and the Ocello Employment Agreement, as more fully described
below, are substantially similar.
The Employment Agreements provide for an annual base salary payable to each officer of $700,000, subject
to review at least every 24 months and potential upward adjustments as determined by the Companys Board of Directors (the Board). In addition, bonuses, if any, are payable at the discretion of the Companys Board. Each officer
is entitled to certain benefits such as health, dental, disability, long term care, paid time off, use of a leased automobile and other fringe benefits as well as participation in the Companys incentive, savings, retirement, profit sharing,
perquisites and other programs, as approved by the Companys Board. The Employment Agreements are automatically renewable for one additional five-year period unless either party provides written notice that the Employment Agreement shall not be
extended and renewed. In the event that the Company does not renew the initial term of an officers Employment Agreement, the Company is required to pay the officer severance in an amount equal to three times the sum of the officers base
salary in effect upon termination of the Employment Agreement plus an amount equal to the highest bonus the officer received in the three years before termination, if any.
Pursuant to the terms of the Employment Agreements, if an officers employment is terminated by reason of such officers death or
disability (as such term is defined in the Employment Agreements), the Company will continue paying the officers base salary plus an amount equal to the highest bonus the officer received in the three years before termination, if
any, for a period of one year following such termination. In addition, health insurance coverage for the officer and his family will continue for three years following such termination. In the event that an officers employment is terminated as
a result of the officers disability, the Company will also pay certain amounts in respect of the officers disability benefits and long-term care policy as more fully described in the Employment Agreements. If an
officers employment is terminated for cause or without good reason (as such terms are defined in the Employment Agreements), the Company will pay the officer his base salary through the date of termination and will have
no further obligations to the officer. Each officer has the right to terminate the Employment Agreement for good reason within nine months following a change of control (as such term is defined in the Employment Agreements)
of the Company.
If the Company terminates an officers employment other than for cause,
death, or disability, or an officer terminates his employment for good reason, the officer will be entitled to a severance payment equal to three times the sum of the officers base salary in effect upon
termination plus an amount equal to the highest bonus the officer received in the three years before termination, if any. In addition, health insurance and disability benefits will be paid by the Company for three years (or until such earlier time
that the officer accepts other employment) following such termination of employment and certain outstanding but unvested options held by the officer at the time of termination, if any, will become immediately vested and exercisable for a period of
180 days following such termination.
The Employment Agreements provide that during the employment period and for one year following the
termination of the Employment Agreement by the Company with cause or by the officer without good reason, each officer may not compete with the Company within a 25 mile radius of any nightclub owned or operated by the Company
or any of its affiliates. The Employment Agreements also contain customary confidentiality, non-solicitation and non-disparagement covenants.
Further, the Employment Agreements provide that if an officers employment is terminated for any reason, the Company shall, at the officers election, promptly pay all outstanding debt owed to the officer and his family or issue
to the officer, with his approval, the number of shares of the Companys common stock determined by dividing (a) the outstanding principal and interest owed to the officer by (b) 50% of the last sale price of the Companys common
stock on the date of termination.
Finally, the Lowrie Employment Agreement provides that if Mr. Lowries employment is
terminated for any reason, the Company must also take all necessary steps to remove Mr. Lowrie as a guarantor of any Company (or its affiliates) obligations to any third party. In the event that the Company is not successful in doing so, the
Company must pay to Mr. Lowrie a cash amount equal to 5% per year of the aggregate amount he is continuously guaranteeing until such time as Mr. Lowrie no longer guarantees the obligations.
The Company has attached hereto as Exhibits 10.86 and 10.87 copies of the Employment Agreements. The foregoing summary is qualified in its entirety by
the contents of the Employment Agreements.
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Exhibit No.
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Description
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10.86
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Employment Agreement between VCG Holding Corp. and Troy Lowrie
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10.87
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Employment Agreement between VCG Holding Corp. and Micheal Ocello
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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VCG HOLDING CORP.
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Date: December 8, 2008
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By:
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/s/ COURTNEY COWGILL
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Courtney Cowgill
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Chief Financial Officer
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