Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: TUESDAY, March 14, 1995 TAG: 9503140141
SECTION: BUSINESS PAGE: B6 EDITION: METRO
SOURCE: GREG EDWARDS STAFF WRITER
DATELINE: LENGTH: Medium
David Wachtel Jr. filed suit in Davidson County, Tenn., Chancery Court seeking $1.32 million in compensatory damages from the corporation for breach of his employment contract.
Wachtel also alleges in the suit that the breach was induced by two company officials, Victor Foti of Roanoke and Joe Cowart of Twin City, Ga. Wachtel wants $4.96 million each from Foti and Cowart.
The Western Sizzlin board fired Wachtel on Feb. 28 after he announced a $13 million tender offer to buy out other company shareholders. Wachtel, who owns 13 percent of the company and is its largest shareholder, made the offer after the board rejected his plan for company growth, opting for a more conservative approach.
The board replaced Wachtel with Foti, Western Sizzlin's former chief financial officer and a board member. Foti could not be reached Monday for comment.
Wachtel, Foti and other franchise owners bought Western Sizzlin in 1993 from a Dallas group that had filed for bankruptcy protection, claiming a $23.5 million debt. The company emerged from bankruptcy in 1994 and reported a pretax profit of $1.1 million on $9.1 million in sales.
Wachtel, a former president and chief executive of Shoney's Inc., another Nashville-based restaurant chain, said last week the major issue was not his contract but that the board had abandoned the plan for growth it had presented the company's shareholders.
Western Sizzlin was founded in 1962. The company owns only one of 279 steak houses that carry its name. The others are franchised operations in a business that Wachtel says is worth $350 million.
by CNB