Sample Business Contracts

Consulting and Resignation Agreement - Quality Dining Inc. and William R. Schonsheck

Sponsored Links


made  to be  effective as of the 13th day of August, 1999,
by and between William R. Schonsheck ("Consultant") and Quality
Dining, Inc., an Indiana corporation ("Company").


1.    Consultant has  been employed  by  the
Company pursuant  to an Employment Agreement dated as of
August 14, 1995 (the  "Employment Agreement") the term of
which  expires  on  the effective date hereof.

2.    Consultant desires to resign his employment  with the
Company upon the effective date of this Agreement.

3.    Consultant is also a party to a  NonCompetition
Agreement  with  the  Company dated  as  of  August   14,
1995 ("NonCompetition Agreement") the term of which expires
on  the date hereof.

4.     Consultant is,  and  will  continue to be,
knowledgeable concerning the Company's business and through
years of experience has gained valuable knowledge and
expertise in the Burger King restaurant business.

5.    The  Company  desires to retain Consultant  as  a
consultant  and Consultant desires to be so retained,  upon the terms and
conditions set forth in this Agreement.


NOW,  THEREFORE, in consideration of the foregoing  and the

mutual  undertakings contained herein,  the  parties  hereto

agree as follows:



Section   1.1.   Term.   The  term ("Term")  of
this Agreement  shall commence on August 13, 1999, and shall
continue through August 12, 2001.



Section 2.1.  Resignation.
Consultant hereby  resigns his  employment with the Company
effective as of  the effective date hereof.

Section  2.2  Stock Options.
Consultant acknowledges that any and all stock options to
acquire shares of the Company's common  stock  are
"underwater" and hereby agrees that  all  such options shall
be terminated as of the effective date hereof.

Consulting Services

Section  3.1.  Creation of the Relationship.
Upon  the terms of  this  Agreement,  and in recognition  of  Consultant's
extensive experience and expertise, the Company hereby
agrees  to retain Consultant, and Consultant hereby agrees
to be retained by the Company, during the Term of this Agreement and on the
terms and  conditions set forth herein, in the capacity of a
consultant to the Company.

Section  3.2.  Duties of Consultant.
During  the  Term hereof, Consultant agrees to render
service to the Company  as  a consultant  from time to time
as may be reasonably  requested  by the  Company, including
but not limited to, advising the Company with respect to (i)
the operations, marketing and development of the Company's
Burger King business, (ii) assisting the Company in
evaluating any potential Burger King acquisitions and (iii)
such other matters  as may reasonably be requested  by the
Company. There  shall  not  be a prescribed minimum or
maximum  number  of hours  to be devoted by Consultant in
fulfillment of Consultant's duties hereunder.  Consultant
may provide services to the Company under  this Agreement
from Consultant's home or business location by telephone  or
in  such  other manner  as is  acceptable  to Consultant  and the Company.
The relationship of  Consultant to the Company hereunder shall
be that of independent contractor and not as employee.



Section   4.1. Compensation. Consultant  shall  be entitled
to a consulting fee of $100,000 per year during the Term of
this   Agreement,  payable  in arrears  in  equal   monthly
installments of  $8,333.34  on  the  15th  day  of  each month
commencing September 15, 1999, with the last installment
due  on August  12, 2001.  In the event of Consultant's
death during  the Term of this Agreement, Consultant shall
be entitled only to  the compensation provided for herein
through the date of his death.

Non-Competition Provisions

Section 5.1.    Covenant   Not-to-Compete.
Until August 13, 2002, except as may be for the benefit of the Company
or  as  the Company may otherwise consent in writing,
Consultant shall  not, directly or indirectly, own, manage,
operate, control or otherwise engage or participate in the
ownership, management, operation   or control  of  (as
principal,  agent, proprietor, partner,   member,
shareholder, director,  trustee,   officer, administrator,
employee, consultant, independent contractor,  or
otherwise),  any business or entity which as one of its
business activities  competes, directly or indirectly,
with  the  Company within any city, town, or metropolitan
area in which the Company, during  such  period, owns or
operates a restaurant  or  has  the right
to  own or operate a restaurant. Notwithstanding anything
to the contrary in this Agreement, the Consultant may
directly or indirectly, (a) continue to engage in the
ownership and operation of  two  Burger
King restaurants (store #7900 and store #8732), (b)  own
securities of the Company, and (c) own securities of any
person  or entity  which securities are  publicly traded
on  a national  or  regional stock exchange or on  an  over-
the-counter market as long as Consultant does not own 5% or
more of any class of securities of any such person or

Section   5.2.   Trade Secrets.
For  purposes  of  this Agreement,  the term  "Trade
Secret"  includes  not  only that confidential  or
proprietary information  defined  as  a  "Trade Secret"
under  the  Indiana  Trade Secrets  Act, I.C.  24-2-3-1 et
seq.  (the "Act"), but also that information which
possesses independent  economic benefit to the Company (including
without limitation customer lists) and, from not being generally known
by other persons who can obtain economic benefit from its disclosure or use.
Consultant covenants that Consultant will, at all times,
conform  Consultant's conduct to the requirements of the
Act  and will not  misappropriate (e.g., use or  disclose
to  any  third party)  any  Trade Secret of the Company.
Consultant  recognizes that the  penalties  for a Trade Secret violation may
include disgorgement  of  profits, payment  of  royalties,
compensatory damages,  punitive  damages,  and
attorney's  fees. Consultant understands that (a) Consultant may ask the
Company to render  an opinion as to whether the Company considers
certain knowledge  to be  a Trade Secret, if such a
question should arise, and (b) upon termination  of this
Agreement for any reason,  Consultant will continue   to
be  prohibited  from any  time  thereafter   from
misappropriating any Trade Secret of the Company.

Section 5.3.  Confidentiality.
During the Term of this Agreement, Consultant shall keep
confidential all Trade Secrets of the Company; maintain in
trust, as the Company's property, all information
concerning the Company's business; and return to  the
Company, all documents that belong to the Company and any
and all copies thereof in Consultant's possession or under
Consultant's control  when  this Agreement terminates, or
at  any  time  upon request by the Company.

Section 5.4. Covenant Not to Raid Employees.
Until August 13,  2002, Consultant shall not, directly or  indirectly,
employ, engage  for personal service or favor (whether  or  not
compensated),  solicit for employment or advise or
recommend  to any other  person  that  such  person
employ, or  solicit  for employment,  any individual now or
hereafter  employed  by  the Company,  or any affiliate of
the Company; nor induce  or  entice any  such  employee to
leave his or her employment; nor adversely interfere with
past, present or prospective relationships between the
Company  and  any  of their clients, customers,  suppliers,
dealers,  employees, agents or other persons  or  entities
with which  any of such companies deals. Notwithstanding
anything  to the  contrary in this Agreement, the
restrictions set forth  in this  Section  5.4  above  will
not  apply  with  regard  to  any individual (a) who has
been terminated by the Company or any such affiliate,  or
(b)  beginning six months after  such  individual ceases
or terminates his relationship (for any reason) with  the
Company or any such affiliate.

Section   5.5.  Separate Covenants.
The parties  hereto acknowledge  and agree that the
covenants contained herein  shall be  construed  as a
series of separate covenants.  In  the  event that any of
the covenants as to a geographical area shall be held
invalid  or  unenforceable,  then the remaining  provisions
and covenants thereof shall nevertheless continue to  be valid  and
enforceable as though the invalid or unenforceable parts
had  not been included  therein  to the extent necessary to
permit  the remaining  separate provisions and  covenants
to  be  enforced. Additionally,  if  such  geographical
area, class  of  protected clients or any time period
referenced herein shall be declared by a  court  of
competent jurisdiction to exceed the maximum  area, class
of clients or time period such court deems reasonable and
enforceable,  such area of restriction or time  period
shall  be deemed  to become  and thereafter be the maximum  area or  time
period which such court deems reasonable and enforceable.

Section  5.6.   Remedies.
Consultant acknowledges  and agrees that the Company would
suffer irreparable harm as a result of  any  breach of the
covenants contained herein and, therefore, agrees that, in
the event of any actual or threatened breach  of any such
covenant, in addition to any other right or remedy which
the  Company  may have (including monetary damages), the
Company shall  be entitled to specific enforcement through
injunctive  or other  equitable  relief obtained from a
court  with  appropriate equity jurisdiction.


Company Stock

Section 6.1.  Restrictions on Transfer; Right of  First Refusal.

(a)   Consultant  owns  an  aggregate  of 349,234 shares
of the Company's common stock ("Company Stock") as  of  the
date of this Agreement.  Consultant  agrees that, without
the prior written consent of the Company, he  will  not,
during  the  Term of  this  Agreement, transfer,  pledge,
grant  a security  interest  in  or otherwise encumber any
shares of Company Stock  now  or hereafter owned by him.

(b)  Consultant hereby agrees that, should he wish to  sell
any  Company Stock during the  term  of  this Agreement,
he  will give the  Company  prior  written notice of
the number of shares of Company Common Stock he  wishes to
sell.  Within 60 days after the  date  of such  notice, the
Company (or its designee) shall  have the right  to
acquire from Consultant the number  of shares  specified in
such notice at a per  share  price equal  to  the average
of the closing  prices  of  the Company  Stock on the Nasdaq National
Market System  on the five  trading  days commencing  on  the  date  of
Consultant's notice to the Company.  The  Company  (or its
designee)  shall  exercise  this  right of  first refusal
by written notice to the Consultant and closing of  the
purchase shall take place within five business days after
the date of the notice of exercise  by the Company  (or its
designee).  Payment for the shares  of Company  Stock
shall be made in immediately  available funds at the
closing.  If the Company (or its designee) does  not
exercise  its  right  of  first refusal  to purchase the
shares of Company Stock specified  in  the Consultant's
notice to the Company within 60 days after the
date   of  such  notice,  the  Consultant shall thereafter
have the right to sell such specified shares of  Company
Common Stock for a period of 120 days after the  date  of
such  notice to  the  Company.If  the Consultant  does not
sell the specified shares  within such  period, such shares
of Company Common Stock shall again   be subject  to  the
right  of  first  refusal described in this Section 6.1.

Section 6.2. Covenant Regarding Joining Group.

The Consultant  hereby  covenants  that, during  the  term
of  this Agreement and for one (1) year following the
expiration of  this Agreement,  he  will not, directly or indirectly,
join  with  any other individual,  entity  or  group
(within  the meaning  of Section  13(d)(3) or 14(d)(2) of
the Securities Exchange  Act  of 1934,  as amended,  for
the purpose of  acquiring, holding  or disposing of any
shares of Company Stock, soliciting any  proxies for any
meetings of the holders of Company Stock, or  otherwise
attempting  to influence in any manner how any holder of
Company Stock votes on any matters presented to such


Section  7.1.  Termination and Release.
The Consultant and  the  Company acknowledge and  agree
that  the  Employment Agreement is hereby terminated and
each hereby releases the other from  any claims each may
have under those agreements except that the Company  shall
pay to the Consultant, the sum of  $49,783.65 representing
the bonus to which Consultant is entitled in respect of his
employment during the Company's 1999 fiscal year  though
the date of termination of his employment.  Such amount
shall  be paid  to  Consultant  at the time of and in
accordance  with  the Company's usual practice for paying

Section   7.2.    Benefit   and   Burden.
Consultant acknowledges  that  the covenants of Consultant  are
unique  and personal; accordingly,  Consultant  may  not
assign any  of Consultant's  rights  or delegate any of
Consultant's  duties  or obligations under this Agreement.
The rights and obligations  of the  Company under this
Agreement shall inure to the benefit  of, and  be  binding
upon, the successors and assigns of the Company. The
rights  and obligations of Consultant under this Agreement
shall  inure  to  the benefit of and be binding upon  the
heirs, legal representatives,  successors  and  permitted
assigns   of Consultant.

Section 7.3.  Nature of Relationship.

The relationship of  Consultant  to  the Company hereunder
shall  be  that  of  an independent  contractor, and not as
an employee,  a  partner  or joint  venturer of the Company
for any purpose.  Consultant shall not  have  any right to
make contracts or commitments for  or  on behalf   of  the
Company,  or  to  act  in  any  manner   as a
representative of the Company.

Section  7.4.   Notices.

Any  notices  to  be   given hereunder shall be deemed
sufficiently given when in writing and when  (a)  actually
served  on the party  to  be  notified,  or (b)  deposited
in  a  receptacle  of  the  United  States mail, certified
or registered, postage prepaid, addressed appropriately as

If to Company at:  Daniel B. Fitzpatrick
                   Quality Dining,Inc.
                   4220 Edison Lakes Parkway
                   Mishawaka, IN 46545

If to Consultant at: William R. Schonsheck
                     9024 Thornbury Lane
                     Las Vegas, NV 89134

Such  addresses  may be changed by any party by  written
advice given pursuant to this Section.

Section 7.5.  Applicable Law.
This Agreement shall  be governed  by  and construed in
accordance with the  laws  of the State of Indiana.

Section 7.6.  No Waiver.
No failure on the part of any party  at any time to require
the performance by any other party of  any  term of this
Agreement shall be taken or held  to  be  a waiver  of such
term or in any way affect such parties' right  to enforce
such term, and no waiver on the part of any party of  any
term  of this Agreement shall be deemed a continuing waiver
or  a waiver of any other term hereof or the breach

Section 7.7.  Modifications.
This Agreement may not be amended,  modified, or supplemented without the
written agreement of  the  parties at the time of such amendment,
modification,  or supplement.

Section 7.8.  Captions.
The captions in this Agreement are for convenience and
identification purposes only, are not  an integral part of
this Agreement, and are not to be considered  in the
interpretation of any part hereof.

Section 7.9.  Attorneys' Fees.
In any action at law or in equity to enforce any of the provisions or rights
under this Agreement,  the unsuccessful party or parties to such
litigation, as  determined by the court in a final judgment
or decree, shall pay  the  successful  party or parties all
costs,  expenses,  and reasonable attorneys' fees incurred
by the successful party  or parties (including without
limitation, costs, expenses, and  fees on any appeals), and
if the successful party or parties recovers judgment  in
any such action or proceeding, such costs, expenses, or
attorneys' fees shall be included as part of the judgment.

Section   7.10.    Severability.
The  invalidity or unenforceability of any particular
provision, or part thereof, of this  Agreement shall not
affect the other provisions,  and  this Agreement  shall
continue in all respects as if such  invalid or
unenforceable  provision had not been contained herein.
If  any provision  of this Agreement is in conflict with
any applicable statute, rule, or other law, it shall be
deemed, if possible,  to be modified or altered to conform
thereto or, if not possible, to be omitted herefrom.

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


Daniel     B. Fitzpatrick, President
William R. Schonsheck