Agreement

EXHIBIT 10.76


AGREEMENT


THIS AGREEMENT ("Agreement") is made as of this first day of March, 1998, by and among Patrick C. Wells, a Minnesota resident ("Wells"), Peter Pflaum, a Minnesota resident ("Pflaum"), and Lundgren Bros. Construction, Inc., a Minnesota corporation ("Lundgren").


RECITALS


A. On January 2, 1997, Wells resigned as an officer, director and full-time employee of Lundgren. Since January 2, 1997, Wells has continued to serve Lundgren as a part-time independent consultant.


B. Wells owns no voting common shares of Lundgren; Wells owns 1,845 non-voting common shares of Lundgren (the "Shares"). The Shares owned by Wells represent 17.37% of all issued and outstanding shares of Lundgren, including both voting and non-voting common shares.


C. Wells and Lundgren wish to document the severance of Wells' relationship with Lundgren.


D. Wells desires to sell the Shares to Pflaum and to Lundgren, and will grant to Pflaum and to Lundgren an option to purchase the Shares on the terms and conditions herein contained. Pflaum and Lundgren are referred to collectively herein as the "Optionees."


E. The Optionees desire to purchase the Shares, and are prepared to purchase the Shares on the terms and conditions herein, as a condition to maintaining an option to purchase said Shares.


AGREEMENT


1. TERMINATION OF CONSULTING RELATIONSHIP.


1.1 Wells and Lundgren agree that:


a. Wells resigned as an officer, director and employee on January 2, 1997;


b. on January 2, 1997, Wells commenced working as a part-time independent consultant to Lundgren;


c. on September 25, 1997, Wells terminated his consulting relationship with Lundgren;


d. Lundgren has paid Wells in full for his services as an independent consultant for the period January 2, 1997 through September 25, 1997; and


e. Wells is responsible for reporting and paying state and federal withholding taxes and charges on Wells' consulting income for such period.


Wells acknowledges that Lundgren has no further obligations to Wells resulting from Wells' resignation as an officer and employee of Lundgren, and Wells' services as an independent consultant from January 2, 1997 to and through September 25, 1997.


1.2 Lundgren agrees to sell to Wells the company truck that Wells has used to date for business purposes, for the sum of $6,900, on March 2, 1998. Lundgren is electing to apply the $6,900 purchase price of the truck to the option payment of $16,900 due under paragraph 2.1.e. hereunder on said date.


1.3 As a shareholder of Lundgren, Wells was the beneficiary of certain life insurance policies, the disposition of which the parties hereto agree as follows:


a. Wells, together with the other shareholders of Lundgren, is a participant in and beneficiary of that certain Amended and Restated Lundgren Bros. Construction, Inc. Stock Purchase Agreement dated February 1, 1993, as amended ("Stock Purchase Agreement"). Lundgren has purchased and maintains life insurance on each of the shareholders of Lundgren pursuant to the Stock Purchase Agreement to fund the repurchase by Lundgren pursuant to the Stock Purchase Agreement of the shares of such shareholder in the event of that shareholder's death. Lundgren is the owner and beneficiary of all such insurance policies purchased by Lundgren to fund Lundgren's obligations under the Stock Purchase Agreement. Lundgren currently pays all of the premiums on the insurance detailed on Exhibit A to this Agreement on the life of Wells ("Wells Insurance"). Lundgren agrees, so long as Lundgren pays the premiums on life insurance for the other shareholders of Lundgren pursuant to the Stock Purchase Agreement, Lundgren will pay the premiums on the Wells Insurance, and continue to be the owner and beneficiary of the Wells Insurance. In the event of Wells' death, Lundgren will use the Wells insurance to purchase, pursuant to the Stock Purchase Agreement, all of the Shares not previously sold to either Lundgren or Pflaum pursuant to the option contained herein, at the price, and on the terms provided in the Stock Purchase Agreement.


b. Lundgren maintains so-called "split dollar plan" life insurance on Wells and on the other shareholders of Lundgren. The Lundgren split dollar insurance insuring Wells is detailed on Exhibit B to this Agreement ("Wells Split Dollar Insurance"). The premiums on the Wells Split Dollar Insurance are divided between Lundgren and Wells, with Wells paying a portion of the annual premium equal to the then economic benefit cost. The Wells Split Dollar Insurance is owned by Wells, and is subject to a collateral assignment of the portion of the cash value and death benefit thereof equal to the lesser of the total premiums paid or the net cash surrender value of the policies. The cash value of the Wells Split Dollar Insurance (and the Wells Insurance) is owned by Lundgren and is used by Lundgren as collateral for Lundgren's working capital credit facility. At any time on or after the date hereof, Lundgren may elect to (i)


convert the Wells Split Dollar Insurance to either term or whole-life insurance on the life of Wells, wholly owned by Lundgren, or (ii) terminate the Wells Split Dollar Insurance.


c. Lundgren pays the premiums on, and holds title to, disability insurance on Wells, as detailed on Exhibit C hereto ("Wells Disability Insurance"). The Wells Disability Insurance is maintained to fund the purchase of the Shares in the event of Wells' permanent disability as defined in the Stock Purchase Agreement, while Wells is a full-time employee of Lundgren. Inasmuch as Wells has terminated his employment with Lundgren, the parties hereto agree that the Stock Purchase Agreement will be amended in the form attached hereto as Exhibit D to eliminate Wells from the disability provisions of the Stock Purchase Agreement. Lundgren will continue to pay the premiums on the Wells Disability Insurance to and through the first anniversary of this Agreement ("Anniversary Date"). At any time on or before the Anniversary Date, Wells may elect, by so informing Lundgren in writing, to assume the Disability Insurance, by agreeing to pay all future premiums due thereon. In the event Wells does not elect to assume the Wells Disability Insurance, any premiums paid by Lundgren thereunder shall remain the property of Lundgren.


1.4 Wells, as a shareholder of Lundgren, will remain personally liable on guarantees made by him to date on Lundgren's indebtedness to financial institutions. Lundgren will exclude Wells from any such future guarantees. From and after the date hereof, Wells will not participate in any partnerships or companies (i) consisting otherwise exclusively of Lundgren shareholders, and (ii) doing business with Lundgren.


2. OPTION TO PURCHASE SHARES


2.1 Wells hereby grants first to Pflaum, and then to Lundgren, the right and option to purchase the Shares for $1,284,685, or $696.30 per share, on the following terms and conditions:


a. The term of the option hereby granted shall run from the date hereof to and through September 1, 2005 (the "Term"), subject to the terms and conditions set forth below.


b. The initial price per share for each Share purchased pursuant to this Agreement is $696.30 per share. The purchase price per Share shall increase at the rate of 6% per annum during the Term, computed as of each anniversary date of this Agreement. In the event any Shares are purchased between anniversary dates of this Agreement, the price per share shall be adjusted PRO RATA to reflect the portion of the year lapsed since the preceding anniversary date.


c. All payments made pursuant ...