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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 10-K
Annual Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the fiscal year ended October 27, 1996
Commission File Number: 0-11514
Max & Erma's Restaurants, Inc.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware No. 31-1041397
- --------------------------------------- ---------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4849 Evanswood Drive Columbus, Ohio 43229
- --------------------------------------- ---------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (614) 431-5800
--------------------
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
Common Shares, $.10 Par Value
-----------------------------
(title of class)
8% Convertible Subordinated Debentures Due 2004
-----------------------------------------------
(title of class)
Indicate by checkmark 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, and (2) has been subject to the filing requirements for
at least the past 90 days. YES X NO
--- ---
Indicate by checkmark 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 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. [ ]
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State the aggregate market value of the voting stock held by non-affiliates of
the registrant. The aggregate market value has been computed by reference to the
closing bid price of such stock, as of December 31, 1996.
Total shares outstanding 4,169,337
Number of shares owned beneficially 1,786,615
and/or of record by directors
and officers (1)
Number of shares held by persons 2,603,161
other than directors or
officers
Closing bid price $6.75
Market value of shares held by $17,571,337
persons other than directors
or officers
(1) For purposes of this computation all officers and directors are included,
although not all are necessarily "affiliates." Includes options to purchase
220,439 shares of common stock, all of which are presently exercisable.
Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.
4,169,337 Common Shares
were outstanding at December 31, 1996
DOCUMENTS INCORPORATED BY REFERENCE
1. Annual Report to Shareholders for the Fiscal Year Ended October 27, 1996
(in pertinent part, as indicated).....Parts II and IV.
2. Proxy Statement for 1997 Annual Meeting of Shareholders (in pertinent
parts, as indicated).....Part III.
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PART I
Item 1. BUSINESS
- ----------------
Max & Erma's Restaurants, Inc. (the "Company"), directly and through
affiliated partnerships, owns and operates a chain of forty-one Max & Erma's
restaurants at December 31, 1996. The Company is a Delaware corporation
organized in 1982, as the successor to a restaurant business founded in 1971.
The Company has registered the phrase "Max & Erma's - Neighborhood Gathering
Place" and its associated logo as a service mark with the United States Patent
and Trademark Office.
The Company's executive offices are located at 4849 Evanswood Drive,
Columbus, Ohio 43229, and its telephone number is (614) 431-5800.
Description of Business
- -----------------------
Max & Erma's restaurants provide generous servings of consistently high
quality food at moderate prices in the casual setting of a neighborhood
gathering place. The menu includes Max & Erma's signature gourmet hamburgers,
specialty sandwiches, salads, appetizers, pasta dishes, chicken, seafood,
steaks, other entrees prepared in a variety of cuisines, desserts and a full
complement of alcoholic and non-alcoholic beverages. Management believes that
the decor and theme of Max & Erma's restaurants allow the introduction of a
broad range of menu items, thus permitting rapid adjustment to changing customer
preferences.
Max & Erma's restaurants are open for both lunch and dinner seven days a
week. Hours of operation are generally 11:00 a.m. to midnight. During fiscal
1996, the average check was approximately $7.83 at lunch and $9.58 at dinner,
although during the second half of the year the dinner check average was $9.68
as a result of the Company's efforts to increase the dinner check average
through the introduction of higher priced entrees. The lunch and dinner meal
periods accounted for approximately 35.9% and 64.1% of net sales, respectively.
Alcoholic beverages constituted approximately 13.6% of net sales in fiscal 1996.
The Company's strategy is to compete in the casual dining segment of
the restaurant industry by offering a variety of high quality food in a casual,
comfortable and fun atmosphere and with a uniquely personable service style. The
philosophy of the Company is to focus on the details of the customer experience
that instill customer loyalty and promote repeat business.
Management believes that Max & Erma's reputation is built every day
with every customer served and that a key to customer loyalty is the server.
Waiters and waitresses are trained based on the "Fifty-two Moments of Truth," a
program based on the Company's consumer research which measures the events that
impact the customer's dining experience. Food is delivered to the table by the
server instead of a food runner, and servers are required to recheck the table
two minutes after delivering the meal. Moreover, the wait staff is empowered to
address customer problems without the assistance of restaurant management.
Max & Erma's restaurants have always been known for gourmet hamburgers
and specialty sandwiches; however, one part of the Company's focus on the
customer is an evolving menu that changes to meet consumer tastes. The Company
believes its menu should be fun as
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well as innovative and reviews, and revises as necessary, the menu twice each
year, and in addition offers an annual summer menu. In fiscal 1992, nightly
dinner specials, such as fajitas, southwestern style steak and jumbo fried
shrimp, were introduced to increase weekday dinner volume and to provide variety
for frequent customers. Weekday lunch specials were added in fiscal 1993, and
separate lunch and dinner menus were introduced during 1994. "Five Great Ways to
be Good," a selection of healthy, low fat menu items, was introduced at the
start of 1995. During 1996 the Company expanded its entree offerings in an
effort to increase its per person dinner check average. By periodically
modifying its menu through the introduction of a broad range of appealing new
menu items the Company has achieved a more diversified sales mix.
The Company makes extensive use of consumer focus groups to conduct
marketing research. Management incorporates the findings of this market research
in its advertising, menu development, employee training, and building design and
decor. According to customers, the major point of difference between the Company
and its competitors is that Max & Erma's restaurants are perceived as being more
of a "fun place," an image the Company tries to foster in its advertising. The
Company spends approximately 3.25% of net sales annually on advertising and uses
television, radio, direct mail, billboards, special events and localized store
marketing designed to increase customer awareness and repeat business.
The Company owns thirty-nine of the Max & Erma's restaurants currently
in operation. Two are owned by separate affiliated partnerships. In addition to
the specified percentage interest in the profits and losses of the affiliated
partnerships, the Company is paid an annual fee equal to 6% or 7% of gross
revenues for managing the two Max & Erma's restaurants owned by the
partnerships. Each management contract provides for monthly payments to the
Company for an initial term of two years and renewal terms aggregating 20
additional years upon the mutual agreement of the parties.
Competition
- -----------
The restaurant business, particularly in the casual dining segment, is
highly competitive in terms of quality and value of products served, type and
variety of menu offered, quality and efficiency of service, ambiance and
attractiveness of facilities and site location. Max & Erma's restaurants compete
with food service operations of various types within their respective locations,
including national and regional chains as well as locally-owned and operated
restaurants. Many of the Company's competitors are substantially larger and have
greater financial resources than the Company.
Employees
- ---------
At November 30, 1996, the Company had 3,611 employees, of which 1,054
were full-time restaurant employees, 2,357 were part-time restaurant employees,
53 were corporate staff personnel and 147 were restaurant managerial personnel.
None of the Company's employees are represented by a labor union or a collective
bargaining unit. The Company considers relations with its employees to be good.
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Restaurant Operations
- ---------------------
The Company strives to maintain quality and uniformity in its
restaurants through careful training and supervision of personnel. All
restaurants are operated in accordance with uniform Company specifications,
which are set forth in detailed operating manuals relating to food and beverage
preparation, maintenance of premises and employee conduct. The Company utilizes
an independent shopping service to monitor implementation of Company operating
standards. The Company and the shopping service have developed testing standards
for the major aspects of restaurant operation, including physical appearance,
cleanliness, wait staff and food quality. The shopping service has "mystery
shoppers" visit each restaurant four times each quarter to evaluate and grade
the restaurant. A report is prepared by the shopping service for each visit and
is reviewed by the Company's Chief Operating Officer and the respective regional
and general managers. A portion of the bonus for each regional and general
manager is based on the scores received on the shopping service reports. The
Company also makes available at each table postage-paid comment cards addressed
to the Company's President. The President responds to any negative comments on a
weekly basis.
Restaurant operations are administered by a management staff headed by
the Chief Operating Officer. A Regional Vice President of Operations reports to
the Chief Operating Officer. Nine regional managers, each of whom supervises the
operations of four to five restaurants, report to either the Chief Operating
Officer or the Regional Vice President of Operations. Each restaurant has a
general manager, who is responsible for training and supervising 60 to 125
employees, and two or three assistant managers. Regional managers are
responsible for hiring their general and assistant managers. General managers,
with the assistance of the regional manager, are responsible for hiring
restaurant employees. The Company seeks to hire experienced restaurant personnel
who must complete a 14 week training program conducted by the Company before
becoming an assistant manager. The Company has historically promoted from within
to fill its regional and general manager positions.
Both regional and general managers receive a base salary plus a bonus
based upon performance against budget and average independent shopping service
scores. General managers prepare quarterly budgets for their stores and regional
managers prepare quarterly budgets for their regions. Bonuses are based on
specific goals derived from these quarterly budgets. Managers may elect to
receive some or all of their bonuses in the Company's common stock at a one-half
discount from fair market value. In addition, all regional managers and general
managers are eligible to receive stock options on a periodic basis. Management
believes that its bonus system and the ability to purchase common stock promote
loyalty and highly motivate managers to meet Company goals.
Management believes that the combination of the authority delegated to
its regional and general managers, particularly with respect to hiring
employees, together with its goal-specific bonus plans, results in a positive
work environment and has contributed to relatively low management turnover.
Purchasing and Inventory Controls
- ---------------------------------
Meat and most other food and restaurant supply items are purchased
through one major distributor in order to obtain favorable prices and to ensure
consistent quality and delivery. For
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major items, the Company typically negotiates prices directly with producers.
For other items, the Company provides the distributor with specifications and
receives monthly prices for such items, generally based upon a "cost plus"
formula. Restaurant managers purchase these items directly from the distributor,
and each restaurant is billed directly for its purchases. Although most of the
Company's food and supplies are presently furnished by one distributor, the
Company believes alternate food suppliers are available and has not experienced
a shortage of food or supplies. A daily inventory is taken for high cost items,
such as steaks, ground meat, seafood and liquor. A physical inventory of all
items is made at the end of each four week accounting period.
Future Expansion
- ----------------
In addition to two restaurants opened during the first quarter of 1997,
the Company intends to open four additional Max & Erma's restaurants during the
remainder of fiscal 1997 and an additional five to six restaurants during fiscal
1998. All but four of the existing Max & Erma's restaurants are located in
suburban areas. Of the existing restaurants, 25 are free-standing and 16 are
in-line shopping center/mall locations. The following table sets forth the
location of each existing Max & Erma's restaurant and the locations of two (all
free-standing) of the four restaurants scheduled to open during the remainder of
1997:
Existing Under Development
-------- -----------------
GEORGIA
Atlanta.......... - 2
ILLINOIS
Chicago.......... 6 -
INDIANA
Indianapolis..... 3 -
KENTUCKY
Lexington........ 2 -
MICHIGAN
Ann Arbor........ 1 -
Detroit............. 6 -
Grand Rapids..... 1 -
NORTH CAROLINA
Charlotte........ 1 -
OHIO
Akron............ 1 -
Cincinnati....... 1 -
Cleveland........ 3 -
Columbus......... 8 -
Dayton........... 3 -
PENNSYLVANIA
Pittsburgh....... 5 -
- -
TOTAL.... 41 2
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The Company's preference is to acquire the land and build new
free-standing restaurants. However, in order to acquire suitable sites, the
Company will utilize ground leases, or lease and convert existing premises.
Management believes that the clustering of three or more restaurants in markets
of sufficient size increases customer awareness, enhances the effectiveness of
advertising and improves management efficiency.
Government Regulation
- ---------------------
The Company is subject to Federal, state and local laws affecting the
operation of its restaurants, including zoning, health, sanitation and safety
regulations and alcoholic beverage licensing requirements. Each restaurant is
operated in accordance with standardized procedures designed to assure
compliance with all applicable codes and regulations. The suspension of a food
service or liquor license could cause an interruption of operations at affected
restaurants.
Business Risks
- --------------
The Company desires to take advantage of the new "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995 (the "Reform
Act"). The Reform Act only became law in late December 1995 and, except for the
Conference Reports, no official interpretations of the Reform Act's provisions
have been published. Many of the following important factors have been
discussed in the Company's prior filings with the Securities and Exchange
Commission.
In addition to the other information in this Report, readers should
carefully consider that the following important factors, among others, in some
case have affected, and in the future could affect, the Company's actual
results and could cause the Company's actual consolidated results of operations
for Fiscal 1997 and beyond, to differ materially from those expressed in any
forward-looking statements made by, or on behalf of the Company.
1. Dependence on Management - The Company's senior management has over 70
years experience with the Company. The loss of one or more key executives
could have an adverse effect on the Company.
2. Competition - The casual dining segment of the restaurant industry is
highly competitive. Many of the Company's competitors are larger national
chains with greater financial resources.
3. Restaurant Industry - The restaurant industry is affected by changing
trends, economic conditions, traffic patterns and weather. Increases in
food, labor and benefits cost along with the availability of employees and
suitable restaurant sites could affect future operating results.
4. Legal - The Company is exposed to various tort and other claims, most
notably liability claims resulting from the sale of alcoholic beverages.
While the Company currently maintains insurance for such claims, there is
no assurance of its adequacy or future availability. An uninsured or
excess claim could have a material adverse affect on the Company.
5. Government Regulation - The restaurant industry is subject to extensive
government regulations relating to the sale of food and alcoholic
beverages, and sanitation, fire and building codes. Suspension or
inability to renew any of the related licenses and permits could adversely
affect the Company's operations. Further more, government actions
affecting minimum wage rates, payroll tax rates and mandated benefits
could affect operating results.
Item 2. PROPERTIES
- -------------------
All but thirteen of the Company's restaurants are occupied under leases
expiring from 1997 to 2025, with renewal options for five to 20 additional
years. The affiliated partnership which owns one of the restaurants in Columbus,
Ohio also owns the premises on which it is located. Restaurant leases are
generally collateralized by liens on leasehold improvements, equipment,
furniture and fixtures. The Company leases its executive offices (15,000 square
feet) and general warehouse and storage facilities (17,000 square feet) in
Columbus, Ohio under an operating lease expiring in October 2000.
The last 21 restaurants opened are based on a new design which the
Company has used as its prototype. The prototype gives Max & Erma's restaurants
a distinct identity and emphasizes an unpretentious neighborhood ambiance. The
prototype design downplays the use of brass, Tiffany lamps and other design
features common to the Company's older restaurants and to many other casual
dining restaurants. Max & Erma's restaurants established prior to the
introduction of the prototype vary in design and appearance, but average 6,000
square feet and seat an average of 160 customers. The freestanding prototype is
approximately 6,700 square feet and seats 200 patrons for dining in addition to
the bar area. A 30 to 40 seat seasonal patio area is optional. The prototype
design is readily adaptable to a variety of sites including shopping center and
mall locations.
The Company believes that its focus on selecting high profile
restaurant sites is critical to its success. The Company's present site
selection strategy is to locate its restaurants in prime, high visibility, high
traffic suburban locations. Management believes that selection of high profile
sites along with the implementation of its prototype restaurant will result in
improved unit economics.
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Item 3. LEGAL PROCEEDINGS
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The Company is a defendant in various legal proceedings regarded as
normal to its business, and in the opinion of management, the ultimate outcome
of such proceedings will not materially affect the Company's financial position
or the results of its operations.
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 contained under the captions "SELECTED QUARTERLY
FINANCIAL DATA" and "SHAREHOLDER INFORMATION" is incorporated herein by
reference to the inside back cover of the Company's Annual Report to
Shareholders for the fiscal year ended October 27, 1996.
Item 6. SELECTED FINANCIAL DATA
- --------------------------------
Information required under this Item is incorporated herein by reference to
the Company's Annual Report to Shareholders for the fiscal year ended October
27, 1996, page 10.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
- --------------------------------------------------------------------
AND RESULTS OF OPERATIONS
-------------------------
Information required under this Item is incorporated herein by
reference to the Company's Annual Report to Shareholders for the fiscal year
ended October 27, 1996, pages 11 through 13.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
- ----------------------------------------------------
The balance sheets as of October 27, 1996 and October 29, 1995 and the
related statements of income, stockholders' equity and cash flows for each of
the three years in the period ended October 27, 1996, and the related notes to
the financial statements together with the independent auditors' report thereon
and the Selected Quarterly Financial Data are incorporated by reference to the
Company's Annual Report to Shareholders for the fiscal year ended October 27,
1996, pages 14 through 24 and the inside back cover.
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Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
- ------------------------------------------------------
ON ACCOUNTING AND FINANCIAL DISCLOSURES
---------------------------------------
None.
PART III
Items 10, 11, 12 and 13. DIRECTORS AND EXECUTIVE OFFICERS OF THE
- -----------------------------------------------------------------
REGISTRANT: EXECUTIVE COMPENSATION: SECURITY OWNERSHIP OF
-----------------------------------------------------------
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT: AND CERTAIN
------------------------------------------------------
RELATIONSHIPS AND RELATED TRANSACTIONS
--------------------------------------
Information required under these Items is incorporated herein by
reference to the Company's Proxy Statement for 1997 Annual Meeting of
Stockholders, pursuant to Regulation 14A.
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM
- ---------------------------------------------------------------------
8-K.
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(a)(1) and (2) and (d): Financial Statements
The financial statements listed in the accompanying index to
financial statements on page 11 are filed as part of this
report.
(a)(3) and (c): Exhibits
The exhibits listed in the accompanying index to exhibits on
pages 12 through 15 are filed as part of this report.
(b): Reports on Form 8-K
Form 8-K was filed on September 26, 1996.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this Annual Report to be signed on
its behalf by the undersigned, thereunto duly authorized.
Dated: January 13, 1997 Max & Erma's Restaurants, Inc.
By: */s/ Todd B. Barnum
-----------------------------------
Todd B. Barnum
Chairman of the Board,
Chief Executive Officer and President
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 indicated and on the dates indicated.
Signature Title
- --------- -----
*/s/ Todd B. Barnum Chairman of the Board, Chief Executive
- ------------------------------------------- Officer and President, Director (Principal
Todd B. Barnum Executive Officer)
*/s/ Mark F. Emerson Chief Operating Officer, Director
- -------------------------------------------
Mark F. Emerson
*/s/ William C. Niegsch, Jr. Executive Vice President and Chief
- -------------------------------------------- Financial Officer, Director,
William C. Niegsch, Jr. (Principal Financial Officer)
*/s/ William E. Arthur Director
- -------------------------------------------
William E. Arthur
*/s/ Donald W. Kelley Director
- -------------------------------------------
Donald W. Kelley
*/s/ Robert A. Rothman Director
- -------------------------------------------
Robert A. Rothman
*/s/ Roger D. Blackwell Director
- -------------------------------------------
Roger D. Blackwell
*/s/ Michael D. Murphy Director
- -------------------------------------------
Michael D. Murphy
*/s/ Thomas R. Green Director
- -------------------------------------------
Thomas R. Green
*By /s/ William C. Niegsch, Jr.
---------------------------------------
William C. Niegsch, Jr.
Attorney-in-Fact
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MAX & ERMA'S RESTAURANTS, INC. AND SUBSIDIARIES
INDEX TO FINANCIAL STATEMENTS AND SCHEDULES
ITEMS 8, 14(a)(1)
REFERENCE PAGE
--------------
ANNUAL REPORT
TO
SHAREHOLDERS
------------
The following items are required to
be included in Items 8 and 14(a)(1)
and are incorporated by reference
from the attached Annual Report to
Shareholders of Max & Erma's
Restaurants, Inc. for the fiscal
year ended October 27, 1996:
- -Balance Sheets as of
October 27, 1996 and October 29, 1995 14 - 15
- -For the years ended October 27, 1996,
October 29, 1995 and October 30, 1994
-Statements of Income 16
-Statements of Stockholders' Equity 17
-Statements of Cash Flows 18
- -Notes to Financial Statements 19 - 23
- -Independent Auditors' Report 24
- -No financial statement schedules
are required to be filed because
the conditions requiring their
filing do not exist or because the
information is given in the
financial statements or notes
thereto.
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REPORT ON FORM 10-K
MAX & ERMA'S RESTAURANTS, INC.
INDEX TO EXHIBITS
Exhibit Description Page No.
------- ----------- --------
No.
---
2 Plan and Agreement of Reorganization, as amended October Reference is made to Exhibit 2 of
15, 1991. Report on Form 10-K filed January
24, 1992.
3(a) Restated Certificate of Incorporation, as amended April 4, Reference is made to Exhibit 4(c) of
1985. Report on Form 10-Q filed June 26,
1985.
3(b) Restated By-Laws, as amended April 4, 1985. Reference is made to Exhibit 4(d) of
Report on Form 10-Q filed June 26,
1985.
3(c) Certificate of Amendment of Certificate of Incorporation Reference is made to Exhibit 3(c) of
September 22, 1986. Report on Form 10-K filed January
23, 1987.
3(d) Certificate of Amendment of Certificate of Incorporation May Reference is made to Exhibit 3(d) of
30, 1990. Report on Form 10-K filed January
25, 1991.
4(a) Form of Common Stock Certificate. Reference is made to Exhibit 4(a) of
Registration Statement on Form S-1
(Registration No. 2-85585).
4(b) Form of Indenture dated as of August 18, 1994, between Max Reference is made to Exhibit 4(a) of
& Erma's Restaurants, Inc. and The Huntington National Bank, Registration Statement on Form S-2
as Trustee. (Registration No. 33-80090).
4(c) Form of Debenture. Reference is made to Exhibit 4(b) of
Registration Statement on Form S-2
(Registration No. 33-80090).
10(a) Max & Erma's, Ltd. Agreement of Limited Partnership, dated Reference is made to Exhibit 10(b) of
May 17, 1972. Registration Statement on Form S-1
(Registration No. 2-85585).
10(b) First Amendment to Agreement of Limited Partnership of Max Reference is made to Exhibit 10(b) of
& Erma's, Ltd., dated September 9, 1974. Registration Statement on Form S-1
(Registration No. 2-85585).
10(c) Max & Erma's Convention Center Ltd. Agreement of Limited Reference is made to Exhibit 10(k) of
Partnership, dated July 27, 1981. Registration Statement on Form S-1
(Registration No. 2-85585).
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13
Exhibit Description Page No.
------- ----------- --------
No.
---
10(d) Letter Agreement between Nine Limited Leasing, Max & Reference is made to Exhibit 10(bb)
Erma's, Inc., and Max & Erma's Indianapolis, Ltd., dated April of Registration Statement on Form S-
24, 1977. 1 (Registration No. 2-85585).
10(e) Letter Agreement between Nine Limited Leasing, Max & Reference is made to Exhibit 10(dd)
Erma's, Inc., and Max & Erma's East, Ltd., dated May 27, 1977. of Registration Statement on Form S-
1 (Registration No. 2-85585).
10(f) Letter Agreement between Nine Limited Leasing, Max & Reference is made to Exhibit 10(ee)
Erma's, Inc., and Max & Erma's Dayton, Ltd., dated October 1, of Registration Statement on Form S-
1977. 1 (Registration No. 2-85585).
10(g) Letter Agreement between Nine Limited Leasing, Max & Reference is made to Exhibit 10(ff) of
Erma's, Inc., and Max & Erma's Lexington, Ltd., dated Registration Statement on Form S-1
September 27, 1978. (Registration No. 2-85585).
10(h) Letter Agreement between Nine Limited Leasing, Max & Reference is made to Exhibit 10(gg)
Erma's, Inc., and Max & Erma's North, Ltd., dated December of Registration Statement on Form S-
28, 1981. 1 (Registration No. 2-85585).
10(i)* Employment Agreement with Todd Barnum, dated December Reference is made to Exhibit 10(b) of
12, 1984. Report on Form 10-K filed January
25, 1985.
10(j)* Employment Agreement with Mark F. Emerson, dated Reference is made to Exhibit 10(c) of
December 12, 1984. Report on Form 10-K filed January
25, 1985.
10(k)* Employment Agreement with William C. Niegsch, Jr., dated Reference is made to Exhibit 10(d) of
December 12, 1984. Report on Form 10-K filed January
25, 1985.
10(l)* Third Amended and Restated 1984 Incentive Stock Option Reference is made to Exhibit 10(n) of
Plan. Report on Form 10-K filed January
25, 1993.
10(m)* Third Amended and Restated 1984 Non-Statutory Stock Option Reference is made to Exhibit 10(o) of
Plan. Report on Form 10-K filed January
25, 1993.
10(n)* Board of Directors' resolution dated October 19, 1992 relating Reference is made to Exhibit 10(p) of
to amendment to Third Amended and Restated 1984 Non- Report on Form 10-K filed January
Statutory Stock Option Plan. 25, 1993.
10(o)* 1992 Stock Option Plan. Reference is made to Exhibit 10(q) of
Report on Form 10-K filed January
25, 1993.
10(p)* 1996 Stock Option Plan. Reference is made to Exhibit 10(p) of
Report on Form 10-K filed January
1996.
10(q)* Indemnification Agreement (form) between Max & Erma's Reference is made to Exhibit 10(y) of
Restaurants, Inc. and each of its directors dated as of June 18,Report on Form 10-K filed January
1986. 23, 1987.
- -----------------------------------------------------------------------------------------------------------------------
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14
Exhibit Description Page No.
------- ----------- --------
No.
---
10(s)* Promissory Note from Karen Brennan, dated February 12, Reference is made to Exhibit 10(ee)
1988. of Report on Form 10-K filed January
27, 1989.
10(t)* Stock Pledge and Option Agreement with Karen Brennan, Reference is made to Exhibit 10(ff) of
dated February 12, 1988. Report on Form 10-K filed January
27, 1989.
10(u) Lease between Max & Erma's Dublin, Inc. and Mango Reference is made to Exhibit 10(ee)
Investments, dated February 9, 1989. of Report on Form 10-K filed January
26, 1990.
10(v)* Employment Agreement with Karen Brennan, dated June 20, Reference is made to Exhibit 10(ff) of
1989. Report on Form 10-K filed January
26, 1990.
10(w)* Board of Directors' Resolution adopted October 29, 1993 Reference is made to Exhibit 10(w)
relating to officers' bonuses. of Report on Form 10-K filed January
27, 1994.
10(x)* Board of Directors' Resolution adopted October 4, 1994 Reference is made to Exhibit 10(x) of
relating to officers' bonuses. Report on Form 10-K filed January
23, 1995.
10(y)* Board of Directors' Resolution adopted October 23, 1995 Reference is made to Exhibit 10(y) of
relating to officers' bonuses. Report on Form 10-K filed January
16, 1995.
10(z)* Written description of split dollar life insurance program for Reference is made to footnote 3 to the
officers. Summary Compensation Table
presented in the Company's Proxy
Statement for the 1996 Annual
Meeting of Shareholders, which is
incorporated by Reference herein.
10(aa)* Board of Directors' Resolution adopted November 2, 1987 Reference is made to Exhibit 10(dd)
relating to split dollar life insurance program for officers. of Report on Form 10-K filed January
25, 1993.
10(bb)* Board of Directors' Resolution adopted October 19, 1992 Reference is made to Exhibit 10(ee)
relating to split dollar life insurance program for officers. of Report on Form 10-K filed January
25, 1993.
10(cc) Revolving Credit Agreement dated October 25, 1993 between Reference is made to Exhibit 10(aa)
Max & Erma's Restaurants, Inc. and The Provident Bank. of Report on Form 10-K filed January
27, 1994.
10(dd) Letter Agreement dated July 20, 1994 between Max & Erma's Reference is made to Exhibit 10(ab)
Restaurants, Inc. and The Provident Bank. of Registration Statement on Form S-
2 (Registration No. 33-80090).
10(ee) Second Amendment to Revolving Credit Agreement dated Reference is made to Exhibit 10(ee)
August 25, 1995 between Max & Erma's Restaurants, Inc. and of Report on Form 10-K filed January
The Provident Bank. 16, 1996.
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Exhibit Description Page No.
------- ----------- --------
No.
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10(ff) Mortgage Commitment Letter dated November 7, 1995 Reference is made to Exhibit 10(ff)
between Max & Erma's Restaurants, Inc. and MetLife Capital of Report on Form 10-K filed January
Financial Corporation. 16, 1996.
10(gg)* Board of Directors' Resolution adopted October 8, 1996
relating to officers' bonuses.
13 Portions of the Annual Report to Stockholders for the
Fiscal Year ended October 27, 1996, incorporated herein
by reference (except for those pages which are
specifically incorporated by reference, the Company's Annual
Report to Stockholders is not to be deemed as filed as part of this
report.)
23 Consents of Experts and Counsel.
24 Power of Attorney.
27 Financial Data Schedule
* Management contract or compensatory plan or arrangement required to be filed
as an exhibit to this Report on Form 10-K pursuant to Item 14(c) of the Report
on Form 10-K.
15