KKD » Topics » Compensation and Employee Benefits.

This excerpt taken from the KKD 8-K filed Nov 1, 2005.
Compensation and Employee Benefits. During the Term of this Agreement, Executive shall receive the following compensation and benefits:

(a)          Executive shall be paid an annual salary of Three Hundred Twenty-Five Thousand Dollars ($325,000) or such higher salary as shall be established by the Company’s President or Board of Directors, which salary shall be subject to applicable withholdings and payable in arrears in equal monthly installments or on such other periodic dates as the Company normally pays its employees pursuant to its payroll practices and administration.

(b)          In consideration of Executive joining the Company on or before November 1, 2005 and his forgoing a bonus opportunity at his current employment, within ten days after Executive’s first day of employment with the Company, Executive shall be paid a bonus in the amount One Hundred Thousand Dollars ($100,000), which shall be subject to applicable withholdings. Executive agrees that if he voluntarily resigns his employment or is terminated for “Good Cause,” as defined in section 5, within the first year after his initial date of employment with the Company, he shall be obligated to repay, and he hereby promises to pay, to the Company a pro rata portion of this bonus amount. The pro rata portion shall be determined by multiplying $100,000 by a fraction, the denominator of which is twelve (12) and the numerator of which is the number of thirty-day periods remaining between his date of termination of employment and the first anniversary of his employment with the Company, but in no event shall the amount to be repaid exceed the net amount of the bonus paid to Executive.

(c)          Executive shall not be eligible for a bonus for the fiscal year ending on or about January 31, 2006. For the fiscal year ending on or about January 31, 2007, the Company agrees that Executive shall receive a minimum bonus in the gross amount, before applicable withholdings, of Twenty-two and one-half percent (22.5%) of his then-current base salary, provided that he is still employed by the Company at the end of such fiscal year. After the fiscal year ending on or about January 31, 2007, Executive shall be eligible for a bonus or such other incentive compensation under such plans and arrangements as are then generally provided for the senior executives of the Company.

(d)          On the next occasion that the Company grants stock options, restricted stock or other equity compensation to senior executives of the Company, Executive will receive such equity compensation in an amount and on a basis that is substantially similar to other senior executives of the Company at Executive’s level of responsibility. Such equity compensation, when granted, shall be governed by the applicable Krispy Kreme plan and any grant agreement issued by the Company.

(e)          The Executive shall be entitled to participate in and receive any other employee benefits and incentive compensation arrangements provided to a majority of the Company’s executive vice presidents or senior vice presidents; provided that the Company reserves the right to amend its benefit plans and/or eliminate any of its employee benefit plans at any time.

 

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(f)           The Company shall reimburse Executive for the reasonable and necessary out-of-pocket expenses, including entertainment, travel and similar items, incurred by him in performing his duties hereunder upon presentation of such documentation thereof as the Company may normally and customarily require of executive vice presidents and senior vice presidents.

(g)          For any compensation payable to Executive as set out above, Executive agrees that the Company shall have a right of offset for any and all damages, costs and expenses arising from a breach or breaches of this Employment Agreement or any other contractual obligation of Executive to the Company or its affiliates, and Executive agrees that such damages, costs, and expenses may be deducted and withheld from any salary, bonus, expense reimbursement or other compensation provided above. Nothing in this subsection (g) shall be read to limit or preclude either party to this Agreement from seeking any additional remedies as may be available through any other means.

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