Commitments and Contingencies

9 Months Ended

Sep. 28, 2014

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 6.  Commitments and Contingencies

Employment Agreements

On January 1, 2012, the Company entered into an employment agreement with Michael Rosenberger pursuant to which Mr. Rosenberger agreed to serve as the Company’s Chief Executive Officer, Chief Financial Officer and Secretary.  The agreement was for a term of two years.  The Company agreed to pay Mr. Rosenberger an annual base salary of $150,000 during the term of the agreement.  In the event Mr. Rosenberger terminated his employment with the Company, or the Company terminated Mr. Rosenberger’s employment without “Cause” (as such term is defined in the agreement), the Company was required to continue paying Mr. Rosenberger his salary for the remainder of the term.

On July 12, 2013, the Company entered into a separation agreement with Mr. Rosenberger and Moose River Management, Inc., a company that is wholly owned by Mr. Rosenberger (“Moose River”).  The separation agreement became effective on July 31, 2013.

Under the terms of the separation agreement, Mr. Rosenberger agreed to resign from his positions as the Chief Executive Officer, Chief Financial Officer and Secretary of the Company, and from any and all other employment positions that he had with the Company, and agreed to resign as a member of the board of directors of the Company, all effective July 31, 2013.  In addition, Moose River agreed to assign to the Company all of the “Dick’s Wings” trademarks (the “Trademarks”) currently being licensed to the Company by Moose River under that certain Trademark License Agreement (the “License Agreement”) dated July 16, 2007 by and between the Company and Moose River.  The Company agreed to pay Mr. Rosenberger $10,000 in settlement of all compensation and reimbursement owed to Mr. Rosenberger arising out of or in connection with his employment with the Company.  In addition, the Company and Mr. Rosenberger agreed to release each other from any and all claims that they may have had against each other.  As a result of the execution of the separation agreement, the employment agreement entered into by and between the Company and Mr. Rosenberger on January 1, 2012 terminated on July 31, 2013.  The Company recognized settlement of related-party debt of $197,550 in connection therewith during the year ended December 29, 2013, which was credited to additional paid-in capital due to the related-party nature of the transaction.

On July 12, 2013, the Company and Mr. Rosenberger also entered into a consulting agreement pursuant to which Mr. Rosenberger agreed to assist the Company with its prior business and future business during a term beginning July 31, 2013 and ending December 31, 2013.  In return, the Company agreed to pay Mr. Rosenberger $70,000 on July 31, 2013 and to make payments of $32,500 to Mr. Rosenberger on September 1, 2013, October 15, 2013, December 1, 2013 and December 31, 2013.  In the event the Company failed to make one or more of these payments to Mr. Rosenberger in the amounts and on the dates specified in the consulting agreement, ownership of the Trademarks would have reverted back to Moose River and the License Agreement would have continued in full force and effect.  The consulting agreement became effective on July 31, 2013.  All payments to Mr. Rosenberger were made in the amounts and on the dates specified in the consulting agreement.  The Company recognized $1,699 of consulting expense in connection therewith during the nine-month period ended September 28, 2014.

On January 22, 2013, the Company appointed Richard W. Akam to serve as its Chief Operating Officer.  In connection therewith, the Company entered into an employment agreement with Mr. Akam pursuant to which it agreed to pay him an annual base salary of $150,000, subject to annual adjustment and discretionary bonuses, plus certain standard and customary fringe benefits.  The initial term of the employment agreement is for one year and automatically renews for additional one year terms until terminated by Mr. Akam or the Company.

The employment agreement provides that, on July 22, 2013, the Company would grant Mr. Akam shares of its common stock equal in value to $50,000 if Mr. Akam is continuously employed by the Company through that date.  The number of shares of common stock that the Company would issue to Mr. Akam would be calculated based on the last sales price of the Company’s common stock as reported on the OTC Bulletin Board on July 22, 2013.  The employment agreement also provides that the Company will grant Mr. Akam additional shares of its common stock equal in value to $50,000 on January 1st of each year thereafter if Mr. Akam is continuously employed by the Company through January 1st of the applicable year.  The number of shares of common stock that the Company will issue to Mr. Akam for each applicable year will be calculated based on the average of the last sales price of shares of the Company’s common stock as reported on the OTC Bulletin Board for the month of January of the applicable year.  

Notwithstanding the above, and in connection therewith, Mr. Akam agreed that the number of shares that may be earned by him under his employment agreement in connection with any particular grant would be equal to the lesser of: (i) 71,429 shares of common stock, or (ii) the number of shares of common stock calculated by dividing $50,000 by the closing price of the Company’s common stock on the day immediately preceding the date the Company’s obligation to issue the shares to him fully accrues.  Mr. Akam also agreed that in the event the Company is unable to fulfill its obligation to issue all of the shares earned by him with respect to any particular grant because it does not have enough shares of common stock authorized and available for issuance, (i) Mr. Akam will not require the Company to issue more shares of common stock than are then authorized and available for issuance by the Company, and (i) the Company may settle any liability to Mr. Akam created as a result thereof in cash.

In the event the Company terminates Mr. Akam’s employment without “cause” (as such term is defined in the employment agreement), Mr. Akam will be entitled to receive the following severance compensation from the Company: (i) if the Company terminates Mr. Akam’s employment during the first year of his employment with the Company, that amount of compensation equal to the salary payable to Mr. Akam during that year, (ii) if the Company terminates Mr. Akam’s employment during the second year of his employment with the Company, that amount of compensation equal to nine months of the salary payable to Mr. Akam during that year, (iii) if the Company terminates Mr. Akam’s employment during the third year of his employment with the Company, that amount of compensation equal to six months of the salary payable to Mr. Akam during that year, and (iv) if the Company terminates Mr. Akam’s employment after the third year of his employment with the Company, that amount of compensation equal to three months of the salary payable to Mr. Akam during the year that such termination occurs.  Mr. Akam will not be entitled to receive any severance compensation from the Company if the Company terminates his employment for “cause” or as a result of his disability, or if Mr. Akam resigns from his employment with the Company.

The employment agreement also contains customary provisions that provide that, during the term of Mr. Akam’s employment with the Company and for a period of one year thereafter, Mr. Akam is prohibited from disclosing confidential information of the Company, soliciting Company employees and certain other persons, and competing with the Company.

On July 22, 2013, the Company issued 71,429 shares of its common stock to Richard Akam pursuant to the terms of the employment agreement. 

On July 31, 2013, the Company appointed Richard Akam as its Chief Executive Officer, Chief Financial Officer and Secretary.  The Company and Mr. Akam did not amend the employment agreement in connection with the above appointments, and Mr. Akam is not receiving any additional compensation in connection with the above appointments.

On August 19, 2013, the Company appointed Daniel Slone as the Company’s Chief Financial Officer.  The Company agreed to pay Mr. Slone an annual base salary of $1.00 in connection with his appointment.  The Company did not enter into an employment agreement with Mr. Slone.  In connection therewith, on August 19, 2013, Richard Akam resigned as the Company’s Chief Financial Officer.  Mr. Akam retained his positions as the Company’s Chief Executive Officer, Chief Operating Officer and Secretary.

On January 1, 2014, Richard Akam earned 28,433 shares of common stock under the terms of his employment agreement with the Company.

Operating Leases

In January 2013, the Company entered into a commercial lease with GGRD II, LLC for its corporate headquarters located at 13453 North Main Street, Jacksonville, Florida pursuant to which the Company leases approximately 1,800 square feet of space.  The lease provides for a fixed monthly rent payment of $1,100 and expires on January 31, 2015.