Sample Business Contracts

Employment Agreement - BUCA Inc. and Joseph J. Kohaut

Employment Forms

  • Employment Agreement. Employers can customize an employment agreement that states the salary, benefits, working hours and other important provisions for their new or existing employee.
  • Consulting Agreement. Answer simple questions to build a contract with a consultant. Specify the services rendered, when payment is due, as well as IP rights.
  • Commission Agreement. Employers who compensate their sales employees based on commissions can prepare an agreement to reduce misunderstandings by specifying the base salary and how commissions are calculated.
  • Executive Employment Agreement. Companies may offer their business executives a contract that is different from the one provided to their regular employees. Executive employment agreements may be more complex because the compensation structure may include a combination of salary and commissions, provide for bonuses based on sales, stock or other financial targets, and include non-compete, confidentiality and severance provisions.
  • Sales Representative Contract. Independent sales representatives offer companies the potential to increase the sale of products or services without the burden of increasing headcount. Both parties should understand how commissions are calculated, when commissions will be paid, as well as how the representative will treat confidential information from the company and whether the representative may also sell a competing line of products or services.
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                              EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT, is made as of this 9th day of December, 2002
by and between BUCA, Inc., a Minnesota corporation (the "Company") and Joseph J.
Kohaut (the "Employee").

         WHEREAS, the Company desires to employ Employee to devote full time
service to the business of the Company and Employee desires to be so employed.

         NOW THEREFORE, IN CONSIDERATION of the premises and the terms and
conditions hereinafter set forth, the parties hereto agree as follows:

         1.   Employment. Subject to the terms and conditions hereof, the
Company shall employ Employee and Employee agrees to be so employed in the
capacity of Executive Vice President, Chief Financial Officer, Secretary and
Treasurer for a term commencing the date hereof and ending on December 31, 2005.

         2.   Duties. Employee shall diligently and conscientiously devote his
full time and attention to the discharge of his duties as Senior Vice President
of Operations and such other positions as assigned by the Board of Directors. In
such capacity, Employee shall at all times discharge said duties in consultation
with and under the supervision of the President and Chief Executive Officer, the
Executive Vice President, Chief Financial Officer and Treasurer, and the Board
of Directors of the Company. Employee shall perform such duties as may from time
to time be given to him by the President and Chief Executive Officer, the
Executive Vice President, Chief Financial Officer and Treasurer, and the Board
of Directors.

         3.   Base Salary. Commencing at the effective date hereof, the Company
shall pay to Employee an annualized base salary of $180,000 in 2002. The Board
of Directors shall establish Employee's base salary for each subsequent calendar
year in an amount not less than the base salary in effect for the prior year.
The base salary is payable in accordance with the Company's standard payroll
practices as in effect from time to time.

         4.   Bonuses. Employee shall be entitled to receive annual incentive
compensation equal to a percentage of his annual base salary. For the year ended
December 31, 2002, the maximum percentage of such incentive compensation shall
be 60%. For each subsequent calendar year, the maximum percentage shall be
determined by the Board of Directors, but shall not be less than that
established for the prior year. Payment of any incentive compensation shall be
based upon the Company attaining certain performance targets selected by the
Board of Directors and based upon the budget for the applicable year. The
incentive compensation for the year ended December 31, 2002 shall be based upon
achieving the following performance targets in 2002: (i) opening 14 new
restaurants, (ii) generating 490 additional operating weeks, (iii) generating
$255,000,000 in total sales, (iv) keeping general and administrative expenses as
a percentage of sales at 5.6% or less, (v) achieving


earnings per share of 75 cents, and (vi) increasing comparable restaurant sales
by 2%. For each subsequent calendar year, the Board of Directors shall, at the
beginning of each year, (a) select five of the following criteria for measuring
the amount of any incentive compensation to be received by Employee for that
year: (i) number of new restaurant openings, (ii) number of operating weeks,
(iii) restaurant operating profit, (iv) total sales, (v) general and
administrative expenses, (vi) comparable restaurant sales, and (vii) such other
factors as determined by the Board of Directors; (b) determine the performance
target for each selected criterion based upon the budget for the applicable
year; and (c) with respect to each selected criterion, determine the percentage
of annual incentive compensation that Employee is entitled to receive upon the
Company attaining the performance target for such criterion.

         5.   Expenses. The Company shall reimburse Employee for all reasonable
and necessary expenses incurred by him in carrying out his duties under this
Agreement. Employee shall present to the Company from time to time an itemized
statement of account of such expenses in such form as may be required by the
Company. In recognition of Employee's need for an automobile for business
purposes, the Company will provide Employee with a $900 per month automobile

         6.   Fringe Benefits. Employee shall be entitled to participate in such
fringe benefit programs maintained by the Company as are available for other
employees similarly situated. The Company shall (i) obtain and pay the premium
for standard family coverage for Employee and his family in the Company's group
health plan; and (ii) provide Employee with long-term disability insurance with
a benefit equal to 60% of his base salary.

         7.   Termination. Employee's employment hereunder shall be terminated
upon the happening of any of the following events;

         (a)  Expiration of the term of this Agreement, without renewal;

         (b)  Death of Employee;

         (c)  Notice to Employee that his employment is terminated due to
Employee's inability to perform his usual and customary duties by reason of
Physical or Mental Disability;

         (d)  Without Cause by the Company at any time upon thirty (30) days
prior written notice to Employee;

         (e)  By Employee upon thirty (30) days prior written notice to the

         (f)  By Employee, if, following a Change in Control of the Company as
defined below, Employee's duties (as in effect immediately prior to such Change
in Control) are Substantially Reduced or Negatively Altered, as defined below,
without his prior written consent, upon thirty (30) days prior written notice to
the Company; or



         (g)  At any time without notice by the Company for Cause.

         For purposes of this Section, "Cause" means (i) Employee's conviction
of a felony which constitutes a crime involving moral turpitude; (ii) Employee's
misappropriation of funds, fraud or embezzlement; (iii) Employee's willful or
gross and repeated neglect of duties hereunder, or willful or gross repeated
misconduct in the performance of such duties, as determined by a majority of the
directors of the Company (collectively, "Misconduct"), and provided that
Employee has been given at least fourteen (14) days prior notice of such
determination and Employee has failed to cure such Misconduct; or (iv)
Misconduct that is deemed by a majority of the directors to have a material
adverse effect on the business, operations, assets, properties, or financial
condition of Company, taken as a whole.

         For purposes of this Section, "Physical or Mental Disability" means any
ailment or incapacity which prevents Employee from performing the duties
incident to Employee's employment hereunder which continued for a period of
either (i) 90 consecutive days in any twelve-month period or (ii) 180 days in
any twelve-month period, and which is expected to be of permanent duration.

         For purposes of this Section, "Change in Control" with respect to the
Company shall have occurred on the earliest of the following dates:

              (i)   the date after the date of this Agreement that any entity or
         person (including a "group" as defined in Section 13(d)(3) of the
         Securities Exchange Act of 1934 (the "Exchange Act")) shall have become
         the beneficial owner of, or shall have obtained voting control over,
         fifty percent (50%) of more of the outstanding common shares of the

              (ii)  the date the shareholders of the Company approve a
         definitive agreement: (A) to merge or consolidate the Company with or
         into another corporation, or to merge another corporation into the
         Company, in which the Company is not the continuing or surviving
         corporation or pursuant to which any common shares of the Company would
         be converted into cash, securities of another corporation, or other
         property (this clause (A) shall not apply to a merger or consolidation
         of the Company in which, immediately following such merger or
         consolidation, more than 70% of both the combined voting power of the
         Company's then outstanding securities entitled to vote generally in the
         election of directors (the "Voting Securities") and the then
         outstanding common stock is then beneficially owned, directly or
         indirectly, by all or substantially all of the persons who beneficially
         owned the Voting Securities and the common stock immediately prior to
         such merger or consolidation in substantially the same proportions as
         their ownership of such Voting Securities and common stock, as the case
         may be, immediately prior to such merger or consolidation); or (B) to
         sell or otherwise dispose of substantially all of the assets of the
         Company; or



               (iii)  the date there shall have been a change in a majority of
         the Board of Directors of the Company within a twelve-month period
         unless the nomination for election by the Company's shareholders of
         each new director was approved by the vote of two-thirds of the
         directors then still in office who were in office at the beginning of
         the twelve-month period.

"Substantially Reduced or Negatively Altered" means, without Employee's express
written consent:

               (i)    the assignment to Employee of any duties inconsistent with
         Employee's positions, duties, responsibilities and status with the
         Company immediately prior to a Change in Control or a change in
         Employee's reporting responsibilities, titles or offices, or any
         removal of Employee from, or any failure to re-elect Employee to, any
         of such positions, except in connection with the termination of
         Employee's employment for Cause, upon the Physical or Mental Disability
         or death of Employee, or upon the voluntary termination by Employee;

               (ii)   a reduction in Employee's Base Salary below the minimum
         Base Salary in Section 3 hereof;

               (iii)  requiring Employee to move his residence more than 100

               (iv)   the failure by Company to continue in effect benefit plans
         substantially equivalent to the benefit plans in effect at the
         effective date of this Agreement or established during the term of this
         Agreement; the taking of any action by Company not required by law
         which would adversely affect Employee's participation in or materially
         reduce Employee's benefits under any of such plans or deprive Employee
         of any material fringe benefit enjoyed by Employee; or the failure by
         Company to provide Employee with the number of paid vacation days,
         holidays and personal days to which Employee was then entitled in
         accordance with Company' normal leave policy in effect the effective
         date of this Agreement; or

               (v)    failure of any successor to the Company not otherwise
         bound by this Agreement to expressly assume and agree to perform the
         obligations of the Company under this Agreement.

         8.    Effect of Termination. If Employee is terminated by the Company
for Cause as defined in Section 7(g) or if Employee terminates employment under
Section 7(e), Employee shall be paid only to the date of actual termination of
employment and Employee shall not be entitled to any additional compensation for
the year in which termination of employment occurs or any other termination

         If Employee is terminated by reason of death or Physical or Mental
Disability, Employee or his estate shall be entitled to a termination payment
equal to eighteen (18)



month's base salary then in effect. The termination payment in the case of
termination due to Physical or Mental Disability shall be made in eighteen (18)
substantially equal monthly installments, beginning on the first day of the
month following termination of employment, and the termination payment shall be
reduced by all disability insurance payments received by Employee during such
period under disability insurance policies provided by the Company under Section
6 hereof.

         If Employee terminates employment for the reason specified in Section
7(f) or Employee is terminated by the Company without Cause following a Change
in Control, or within one hundred eighty (180) days prior to a Change in Control
and such termination is related to the Change in Control, Employee shall be
entitled to a termination payment equal to eighteen (18) month's base salary
then in effect, payable in eighteen (18) equal installments, beginning on the
first day of the month following termination of employment and the Company shall
continue Employee's health benefits for one (1) year or, at its option, pay
Employee's COBRA coverage premiums during the COBRA period. If Employee
terminates employment as a result of a Change in Control but Employee's duties
have not been Substantially Reduced or Negatively Altered, Employee shall be
entitled to a termination payment equal to twelve (12) month's base salary then
in effect, payable in twelve (12) equal installments beginning the first day of
the month following termination of employment.

         If Employee is terminated by the Company without Cause and other than
associated with a Change in Control as outlined above, Employee shall be
entitled to a termination payment equal to eighteen (18) month's base salary
then in effect, payable in eighteen (18) equal installments beginning on the
first day of the month following termination of employment.

         9.    Excise Tax. Unless otherwise prohibited by applicable law, if an
amount paid to Employee under this Agreement is subject to the excise tax
imposed by Section 4999 of the Internal Revenue Code, or any successor provision
thereto, the Company shall pay to Employee an additional amount in cash equal to
the amount necessary to cause the aggregate remuneration received by Employee
under this Agreement, including such additional cash payment (net of all
federal, state, and local income taxes and all taxes payable as a result of the
application of Section 280G and 4999 of the Internal Revenue Code or any
successor provisions thereto) to be equal to the aggregate remuneration
executive would have received, excluding such additional payment (net of all
federal, state, and local income taxes), if Section 280G and 4999 (and any
successors thereto) have not been enacted into law. The adjustments, if any,
required by this Section shall be determined by tax counsel selected by
Company's independent accountants with Employee's approval.

         10.   Confidentiality. "Confidential Information" means any information
or compilation of information possessed by the Company that derives independent
economic value, actual or potential, from not being generally known to, and not
being readily ascertainable by proper means by other persons who can obtain
economic value from its disclosure or use, including by not limited to: (a) any
information not generally known in the industry of the Company regarding the
Company's pricing of services, research,



development, marketing, servicing, business systems, and techniques; (b)
financial information concerning the Company; and (c) any information that the
Company may from time to time designate as "confidential," "proprietary," or
"trade secrets" which is not generally known in the industry of the Company.

         Employee may have access to Confidential Information which the Company
desires to protect at all times. Employee understands, acknowledges, and agrees
that the Company has expended substantial sums of money, time and effort in
developing such Confidential Information and the Company will be substantially
harmed in the competitive marketplace if the Confidential Information is used to
its detriment or to the benefit of others.

         In recognition of the foregoing, Employee agrees that:

               (a)   Employee will not, during or after employment with the
         Company, directly or indirectly knowingly use or disclose any
         Confidential Information to any other person, firm or company, or in
         any way use for his benefit, or to the detriment of the Company, any
         information or knowledge obtained during the course of his employment
         with the Company, except as required in the conduct of the Company's
         business or as authorized in writing by the Company; and

               (b)   All memoranda, notes, records, papers and other documents
         and all copies thereof relating to the Company's operations and all
         objects related thereto are and remain the property of the Company;
         including, but not limited to, those developed, investigated, or
         considered by the Company. Employee will not copy or duplicate any of
         the aforementioned documents or objects nor use any information
         contained therewith, except for the Company's benefit, either during or
         after his employment.

         11.   Covenant Not to Compete. The parties agree that the Company would
be substantially harmed if Employee competes with the Company during employment
with the Company or after termination of employment with the Company. Therefore,
in exchange for the benefits provided to Employee hereunder, Employee agrees
that during his employment with the Company and for a period of one (1) year
after termination of such employment for any reason, Employee will not directly
or indirectly, without the written consent of the Company;

               (a)   Own, operate or render services to any entity engaged,
         directly or indirectly, in owning or operating Italian restaurants
         within fifty (50) miles of any restaurant owned or managed by the
         Company; or

               (b)   Hire, offer to hire, entice away, or in any other way,
         persuade or attempt to persuade any entity or any employee, officer,
         agent, independent contractor, supplier, customer, or subcontractor of
         the Company to discontinue their relationship with the Company.



         12.   Disparagement. The Company and Employee agree that during and
after the term of this Agreement, they will not knowingly vilify, disparage,
slander or defame the other party or, in the case of the Company, its officers,
directors, employees, business or business practices.

         13.   Remedy. Employee and the Company acknowledge that in the event of
a breach of this Agreement by either party, money damages would be inadequate
and the non-breaching party would have no adequate remedy at law. Accordingly,
in the event of any controversy concerning the rights or obligations under this
Agreement, such rights or obligations shall be enforceable in a court of equity
by a decree of specific performance. Such remedy, however, shall be cumulative
and nonexclusive and shall be in addition to any other remedy to which the
parties may be entitled to by law.

         14.   Notices. All notices required or permitted to be given under this
Agreement shall be given by certified mail, return receipt requested, to the
parties at the following addresses or to such other addresses as either may
designate in writing to the other party:

               If to Company:             BUCA, INC.
                                          1300 Nicollet Avenue
                                          Suite 5003
                                          Minneapolis, MN 55403

               If to Employee:            Joseph J. Kohaut
                                          1112 West 139th Street
                                          Burnsville, MN 55337

         15.   Governing Law. This Agreement shall be construed and enforced in
accordance with the internal laws of the State of Minnesota.

         16.   Entire Contract. This Agreement constitutes the entire
understanding and agreement between the Company and Employee with regard to the
matters stated herein. There are no other agreements, conditions or
representations, oral or written, express or implied, with regard to the
employment of Employee by the Company. This Agreement may be amended only in
writing, signed by both parties hereto.

         17.   Binding Effect. This Agreement shall inure to the benefit of and
be binding upon the Company, its successors and assigns, and shall inure to the
benefit of and be binding upon Employee, his heirs, distributees and personal
representatives. In the event of Employee's death, any amounts payable hereunder
shall be paid in accordance with the terms of this Agreement to Employee's
designee, or if there is no such designee, to Employee's estate.



         IN WITNESS WHEREOF, the parties have executed this Agreement the date
and year first above written.

                                        BUCA, INC.

                                        By:  /s/ Joseph P. Micatrotto
                                             Its:  Chairman, President and
                                                   Chief Executive Officer

                                        /s/ Joseph J. Kohaut
                                        Joseph J. Kohaut