Tennessee | 0-25225 | 62-1749513 | ||
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
10.1
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Employment Agreement, dated September 12, 2011, between the Company and Sandra B. Cochran | |
10.2
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Employment Agreement, dated September 12, 2011, between the Company and Michael A. Woodhouse |
Date: September 15, 2011 | CRACKER BARREL OLD COUNTRY STORE, INC. |
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By: | /s/ Lawrence E. Hyatt | |||
Name: | Lawrence E. Hyatt | |||
Title: | Senior Vice President and Chief Financial Officer | |||
(a) | If either the Company or Executive do not intend to continue Executives employment with the Company in the capacity of Chief Executive Officer beyond the Expiration Date, such party shall, at least 180 days prior to such date, provide |
to the other party written notice of its or her intention not to continue her employment in such capacity. |
(b) | If the Company ceases to employ Executive in the capacity of Chief Executive Officer at any time on or after the Expiration Date, for any reason other than on account Cause, then the Company shall pay Executive an amount equal to 1.5 times Base Salary (as defined in Section 4.1) in effect on the Expiration Date, or, if greater, immediately prior to the Executives last day of employment, which amount shall be paid to Executive in equal installments ratably over 18 months, as measured from Executives last day of employment with the Company (whether or not such termination of employment occurs contemporaneously with Executives ceasing to serve as the Companys Chief Executive Officer), and commence to be paid to Executive, unless delay is required pursuant to clause (b) of Section 15.8, on the first regularly scheduled Company payroll date for Peer Executives (as defined in Section 4.2) that occurs after the 30th day from Executives last day of employment with the Company, which payment will include amounts owed to Executive for the period between Executives last day of employment with the Company and the payment date, and the remaining installments shall be paid to Executive in accordance with the Companys regularly scheduled payroll cycles for Peer Executives over the remainder of such 18-month period; provided, that to receive the payments described in this clause (b) of Section 2.2 Executive has executed and delivered the release attached hereto as an addendum and made a part hereof (the Release) and any revocation period applicable to such Release shall have expired as of the end of such 30-day period. Any payments made under this clause (b) of Section 2.2 shall reduce the payments to which the Executive may be entitled to receive pursuant to the Companys severance plan or policy then in effect for Peer Executives. In addition, if (i) (A) prior to the Expiration Date, there occurs a Change in Control (as defined in Section 10.3) or (B) following the Expiration Date, there occurs a Change in Control within the meaning of the Employee Retention Agreement between the Executive and the Company dated March 11, 2009, as amended (the Retention Agreement), and (ii) the Executives employment terminates within the 90-day period before or the two-year period following such a Change in Control, then the Executives severance entitlements shall not be determined pursuant to this Section 2.2(b), but instead shall be determined pursuant to Section 10 (in the case of clause (i)(A) above) or pursuant to the Retention Agreement (in the case of clause (i)(B) above). |
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(a) | Annual Incentive Award. Executive shall be entitled to an annual bonus opportunity, the amount of which shall be determined by the Compensation Committee of the Board (the Committee). The amount of and performance criteria with respect to any such bonus in any year shall be determined not later than the date or time prescribed by Treas. Reg. § 1.162-27(e) in accordance with a formula to be agreed upon by the Company and Executive and approved by the Committee that reflects the financial and other performance of the Company and the Executives contributions thereto. Throughout the Term, the Executives annual target (subject to such performance and other criteria as may be established by the Committee) bonus percentage shall be no less than 100% of the Base Salary. |
(b) | Long Term Incentive Award. Each year, the Executive shall be considered by the Committee for a long term incentive award (an LTI Award), and any such award shall have a target grant date value equal to no less than 250% of the Base Salary, provided, that for any LTI Award granted in 2012, the target grant date value shall equal 243.6% of the Base Salary. A grant of an LTI Award in any year shall be in the discretion of the Committee, provided that the Committee shall be required to grant the Executive an LTI Award if LTI Awards are being made for such year to other senior executives of the Company generally. |
(c) | Welfare Benefit Plans. During the Term, Executive and Executives eligible dependents shall be eligible for participation in, and shall receive all benefits under, the welfare benefit plans, practices, policies and programs provided by the Company (including, without limitation, medical, prescription, dental, disability, executive life, group life, accidental death and travel accident insurance plans and programs) to the extent applicable generally to Peer Executives. Also, throughout the Term, in addition to participating in the other insurance programs provided to Peer Executives, the Company, for the benefit of Executive, shall pay the premiums to maintain in force during the Term a policy of term life insurance covering the Executive, with such carrier as is reasonably acceptable to the Company and Executive, in the face amount of $2.5 million, with benefits payable to the beneficiary or beneficiaries designated by Executive in writing. |
(d) | Vacation. Executive shall be entitled to an annual paid vacation commensurate with the Companys established vacation policy for Peer Executives. The timing of paid vacations shall be scheduled in a reasonable manner by Executive. |
(e) | Business Expenses. The Company shall reimburse Executive for all reasonable business expenses incurred by Executive during the Term in the performance of Executives services under this Agreement. Executive shall follow the Companys expense procedures that generally apply to Peer Executives in accordance with the policies, practices and procedures of the Company to the extent applicable generally to Peer Executives. |
(f) | Perquisites. Executive shall be entitled to receive such executive perquisites, fringe and other benefits as are provided to the most senior executives and their families under any of the Companys plans and/or programs in effect from time to time and such other benefits as are generally available to Peer Executives. |
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(g) | Legal Fees. The Company shall pay up to $25,000 in legal fees and out-of-pocket expenses incurred by Executive in connection with the negotiation and consummation of this Agreement. |
(h) | Clawback of Incentive-Based Compensation. Notwithstanding any other provision to the contrary, any incentive-based compensation within the meaning of Section 10D of the Securities Exchange Act of 1934, as amended (the Exchange Act), will be subject to the Companys clawback policy that is adopted in the manner required by Section 10D(b)(2) of the Exchange Act, as determined by the applicable rules and regulations promulgated thereunder from time to time by the U.S. Securities and Exchange Commission. |
(a) | (1) any act by Executive involving fraud, (2) any breach by Executive of applicable regulations of competent authorities in relation to trading or dealing with stocks, securities, investments and the like or (3) any willful or grossly negligent act by Executive resulting in an investigation by the Securities and Exchange Commission, which, in each of cases (1), (2) and (3) above, a majority of the Board determines in its sole and absolute discretion materially adversely affects the Company or Executives ability to perform her duties under this Agreement; |
(b) | attendance at work in a state of intoxication or otherwise being found in possession at her place of work of any prohibited drug or substance, possession of which would amount to a criminal offense; |
(c) | Executives personal dishonesty or willful misconduct in connection with her duties to the Company; |
(d) | breach of fiduciary duties to the Company involving personal profit by Executive; |
(e) | conviction of Executive for, or Executive pleading guilty or no contest to, any felony or crime involving moral turpitude; |
(f) | material breach by Executive of any provision of this Agreement or of any Company policy adopted by the Board, which breach Executive does not cure within 15 days after the Company provides written notice of such breach to Executive; or |
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(g) | the continued failure of Executive to perform substantially Executives duties with the Company (other than any such failure resulting from incapacity due to Disability, and specifically excluding any failure by Executive, after good faith, reasonable and demonstrable efforts, to meet performance expectations for any reason), after a written demand for substantial performance is delivered to Executive by a majority of the Board that specifically identifies the manner in which such Board believes that Executive has not substantially performed Executives duties. |
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(a) | other than her removal for Cause pursuant to Section 5 and subject to the provisos below, without the prior written consent of Executive, the assignment to Executive of any duties inconsistent in any material respect with Executives position (including status, offices, titles and reporting requirements), authority, duties or responsibilities as in effect on the Effective Date, or any other action by the Company which results in a demonstrable diminution in such position, authority, duties or responsibilities; provided, however, that an isolated, insubstantial and inadvertent action not taken in bad faith, which is remedied by the Company promptly after receipt of written notice thereof given by Executive, shall not constitute Good Reason; and provided further, that the Company may elect to name another executive to the position of President (reporting to Executive), and such action shall not be a violation of this subparagraph 8.2(a) giving rise to Good Reason; |
(b) | a reduction by the Company in Executives Base Salary as in effect on the Effective Date or as the same may be increased from time to time, unless such reduction is a part of an across-the-board proportional decrease in base salaries affecting all Peer Executives which reduction is approved by the Committee; provided, however, that in any event, the Company shall not reduce Executives Base Salary below 90% of the Base Salary as in effect on the Effective Date; |
(c) | a reduction by the Company in Executives (1) annual target bonus percentage to which Executive is entitled pursuant to Section 4.2(a) or (2) target percentage under any long-term incentive plan established by the Company to which Executive is entitled pursuant to Section 4.2(b), unless, in either case (1) or (2), such reduction is a part of an across-the-board proportional decrease in annual |
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target bonuses percentages or target percentages under any long-term incentive plan, as applicable, affecting all other Peer Executives, which reduction is approved by the Committee; provided, however, that in any event, the Company shall not reduce Executives annual target bonus below 90% of the Base Salary as in effect on the Effective Date; |
(d) | a reduction by the Company of benefits under (1) a pension plan or arrangement or (2) a compensation plan or arrangement in which Executive participates, or the elimination of Executives participation in any such plan or arrangement which reduction or elimination results in a reduction, in the aggregate, of the benefits provided thereunder, taking into account any replacement plan or arrangement or other additional compensation provided to Executive in connection with or following such reduction or elimination (except for immaterial reductions or across-the-board plan changes or terminations similarly affecting other Peer Executives); provided, that, subject to Section 15.8, in the event of any such changes or terminations, the Company shall timely pay or provide to Executive any accrued amounts or accrued benefits required to be paid or provided or which Executive is eligible to receive under any such plan or arrangement in accordance with the terms of such plan or arrangement; |
(e) | the Company requiring Executive, without her consent, to be based at any office or location more than 50 miles from the Companys current headquarters in Lebanon, Tennessee; |
(f) | the material breach by the Company of any provision of this Agreement; or |
(g) | the failure of any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. |
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(a) | The Company shall pay to Executive the sum of (i) Executives Base Salary then in effect through the date of termination to the extent not theretofore paid, (ii) a pro-rata portion of amounts payable under any then existing incentive or bonus plan applicable to Executive (including, without limitation, any incentive bonus referred to in Section 4.2(a)) for that portion of the fiscal year in which the termination of employment occurs through the date of termination, (iii) any accrued expenses and vacation pay to the extent not theretofore paid, (iv) any compensation previously deferred by Executive (together with any accrued interest or earnings thereon) to the extent not theretofore paid, and (v) any amounts payable under any then existing incentive or bonus plan applicable to Executive in respect of the fiscal year immediately preceding the fiscal year in which the termination of employment occurs (the sum of the amounts described in subsections (i), (ii), (iii), (iv) and (v) shall be referred to in this Agreement as the Accrued Obligations); provided, that (x) the amounts described in subsections 9.1(a)(i) and (iii) will be paid in a lump sum on the Companys first regularly scheduled payroll date for Peer Executives that occurs following Executives last day of employment, (y) the amount described in subsection 9.1(a)(ii) shall be paid as soon as practicable after the end of the fiscal year to which such bonus relates and the amount that is pro-rated for Executives length of service during the year shall be determined by the actual performance of the Company during such year, and (z) the amounts described in subsection 9.1(a)(iv) and (v) shall be paid at the times provided in the applicable plans under which the deferral was made or the bonus is payable; |
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(b) | The Company shall pay to Executive, commencing, unless delay is required pursuant to clause (b) of Section 15.8, on the first regularly scheduled Company payroll date for Peer Executives that occurs after the 30th day from Executives last day of employment with the Company, which payment will include amounts owed to Executive for the period between Executives last day of employment with the Company and the payment date, and the remaining installments shall be paid to Executive in accordance with the Companys regularly scheduled payroll cycles and procedures for Peer Executives over the remainder of the 24-month period (such 30-day period, the Severance Delay Period), provided, that Executive has executed and delivered the Release and any revocation period applicable to such Release shall have expired as of the end of the Severance Delay Period, the aggregate of the following amounts: |
(1) | in installments ratably over 24 months, as measured from Executives last day of employment with the Company, in accordance with the Companys normal payroll cycle and procedures, the amount equal to 1.5 times the sum of Executives annual Base Salary and target bonus (referred to in Section 4.2(a)), each as in effect as of the date of termination (without giving effect to any reduction by the Company in annual Base Salary or annual target bonus percentage which would constitute Good Reason pursuant to Section 8.2(b) or 8.2(c)(1)); |
(2) | Executives participation in the life, medical and disability insurance programs in effect on the date of termination of employment shall continue for 24 months after the date of termination of employment; provided, however, that notwithstanding the foregoing, the Company shall not be obligated to provide such benefits if Executive becomes employed by another employer and is covered or permitted to be covered by that employers benefit plans, without regard to the extent of such coverage; |
(c) | Unless the applicable award agreements contain more favorable vesting or exercise provisions upon Executives termination of employment, outstanding awards under the Companys equity incentive plans shall vest and become exercisable as follows: |
(1) | (i) all stock options held by Executive that are vested prior to or on the date of Executives termination of employment shall be exercisable in accordance with their terms and (ii) 50% of the shares subject to unvested stock options in each grant held by Executive as of the date of Executives termination of employment shall vest immediately and will be exercisable during such period as set forth in the applicable award agreement or incentive plan; |
(2) | in the event that, as of the date of Executives termination of employment, Executive holds any shares of restricted stock (or restricted stock units or similar awards) whose vesting is subject solely to Executives continued employment with the Company, a percentage of such award shall |
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immediately vest that is equal to a fraction, the numerator of which is the number of days that have elapsed between the date of grant and the date of Executives termination of employment, and the denominator of which is the total number of days in the original vesting term; and |
(3) | in the event that, as of the date of Executives termination of employment, Executive holds any shares of restricted stock (or restricted stock units or similar awards, including, without limitation, performance shares and performance units) whose vesting is subject to performance criteria and the performance period for such award has not been completed, 100% of Completed Period Shares (as defined below) and 50% of Remaining Period Shares (as defined below) shall vest as of the date on which the Board (or applicable committee thereof) determines the actual performance of the Company during the applicable performance period and the actual number of shares (the Actual Number of Shares) of restricted stock (or restricted stock units or similar awards, including, without limitation, performance shares and performance units) that would have otherwise vested in the event Executive had remained employed by the Company through the determination date. For purposes of this Agreement, the term Completed Period Shares shall mean the Actual Number of Shares multiplied by the fraction, the numerator of which is the number of days that have elapsed between the first day of the applicable performance period and the date of the termination of Executives employment, and the denominator of which is the total number of days in the applicable performance period. The term Remaining Period Shares shall mean the Actual Number of Shares multiplied by the fraction, the numerator of which is the number of days that are remaining in the applicable performance period following the date of the termination of Executives employment, and the denominator of which is the total number of days in the applicable performance period. |
(d) | To the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any other accrued amounts or accrued benefits required to be paid or provided or which Executive is eligible to receive under any plan, program, policy, practice, contract or agreement of the Company (such other amounts and benefits shall be referred to in this Agreement as the Other Benefits), which Other Benefits are not subject to the execution of the Release and shall be paid to Executive at the times provided under the applicable plan, program, policy, practice, contract or agreement of the Company. |
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(a) | Unless delay is required pursuant to clause (b) of Section 15.8, the Company shall pay to Executive in a single lump sum cash payment on the first regularly scheduled Company payroll date for Peer Executives that occurs after the 30th day from Executives last day of employment with the Company, provided, that Executive has executed and delivered the Release and any revocation period applicable to such Release shall have expired as of the end of the Severance Delay Period, the aggregate of the following amounts: |
(1) | the Accrued Obligations (as defined in Section 9.1(a)(1), except that solely for purposes of this Section 10.2(a)(1), (x) Executives target bonus shall be prorated based solely on the portion of the fiscal year in which the termination of employment occurs through the date of termination (and not on the Companys actual performance for such period) and such prorated amount shall be paid contemporaneously with the amounts payable pursuant to Section 10.2(a)(2) and (y) the Accrued Obligations described in clauses (a)(i), (a)(iii) and (a)(iv) of Section 9.1 shall not be conditioned on the execution of the Release and shall be paid to Executive at the time periods described in clause (a) of Section 9.1; and |
(2) | the amount equal to 3 times the sum of (x) Executives Base Salary and (y) Executives target bonus (described in Section 4.2(a)), each as in effect as of the date of Executives termination of employment without regard to any action taken by the Company constituting Good Reason. |
(b) | (i) All stock options held by Executive that are vested (including, without limitation, those vested by reason of subpargraph 10.2(b)(ii) and any Change in Control occurring prior to Executives termination of employment) on the effective date of the termination shall be exercisable in accordance with their terms and (ii) all unvested stock options held by Executive on the date of Executives termination of employment shall become immediately vested and exercisable. |
(c) | In the event that, as of the date of Executives termination of employment, Executive holds any shares of restricted stock (or restricted stock units or similar awards) whose vesting is subject solely to Executives continued employment with the Company, such award shall vest immediately. |
(d) | In the event that, as of the date of Executives termination of employment, Executive holds any shares of restricted stock (or restricted stock units or similar |
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awards, including, without limitation, performance shares and performance units) whose vesting is subject to performance criteria and the performance period for such awards has not been completed, the target number or value, as applicable, of such awards shall vest immediately. |
(e) | Executives participation in the life, medical and disability insurance programs in effect on the date of termination of employment shall continue for 24 months after the date of termination of employment; provided, however, that notwithstanding the foregoing, the Company shall not be obligated to provide such benefits if Executive becomes employed by another employer and is covered or permitted to be covered by that employers benefit plans, without regard to the extent of such coverage; and |
(f) | To the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any Other Benefits (as defined in Section 9.1(d)), which Other Benefits are not subject to the execution of the Release and shall be paid to Executive at the times provided under the applicable plan, program, policy, practice, contract or agreement of the Company. |
(a) | any person (as defined in Section 13(h)(8)(E) of the Exchange Act), other than the Company or any of its subsidiaries or any employee benefit plan of the Company or any of its subsidiaries, becomes the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company (or any successor to all or substantially all of the Companys assets) representing more than 35% of the combined voting power of the Companys (or such successors) then outstanding voting securities that may be cast for the election of directors of the Company (other than as a result of an issuance of securities initiated by the Company (or such successor) in the ordinary course of business); |
(b) | as the result of, or in connection with, any cash tender or exchange offer, merger or other business combination or contested election, or any combination of the foregoing transactions, less than a majority of the combined voting power of the then outstanding securities of the Company or any successor company or entity entitled to vote generally in the election of the directors of the Company or such other corporation or entity after such transaction are held in the aggregate by the holders of the Companys securities entitled to vote generally in the election of directors of the Company immediately prior to such transaction; |
(c) | all or substantially all of the assets of the Company are sold, exchanged or otherwise transferred; |
(d) | the Companys shareholders approve a plan of liquidation or dissolution of the Company; or |
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(e) | during the Term, Continuing Directors cease for any reason to constitute at least a majority of the Board. For this purpose, a Continuing Director is any person who at the beginning of the Term was a member of the Board, or any person first elected to the Board during the Term whose election, or the nomination for election by the Companys shareholders, was approved by a vote of at least two-thirds of the Continuing Directors then in office, but excluding any person (1) initially appointed or elected to office as result of either an actual or threatened election and/or proxy contest by or on behalf of any person or group (within the meaning of Section 13(d) of the Exchange Act) other than the Board, or (2) designated by any person or group (within the meaning of Section 13(d) of the Exchange Act) ) who has entered into an agreement with the Company to effect a transaction described in Section 10.3(a) through (d). |
(a) | Notwithstanding any other provision to the contrary, if any payments or benefits Executive would receive from the Company pursuant to this Agreement or otherwise (collectively, the Payments) would, either separately or in the aggregate, (i) constitute parachute payments within the meaning of Section 280G of the Code, and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the Excise Tax), then the Payments will be equal to the Reduced Amount (defined below). The Reduced Amount will be either (1) the entire amount of the Payments, or (2) an amount equal to the largest portion of the Payments that would result in no portion of any of the Payments (after reduction) being subject to the Excise Tax, whichever amount after taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate, net of the maximum reduction in federal income taxes which could be obtained from a deduction of such state and local taxes), results in the Executives receipt, on an after-tax basis, of the greatest amount of the Payments. If a reduction in the Payments is to be made so that the amount of the Payments equals the Reduced Amount, the Payments will be paid only to the extent permitted under the Reduced Amount alternative; provided, that in the event the Reduced Amount is paid, the cash payments set forth in Section 10.2(a) shall be reduced as required by the operation of this Section 10.4. |
(b) | The Company shall engage the accounting firm engaged by the Company for general audit purposes at least 20 business days prior to the effective date of the Change in Control to perform any calculation necessary to determine the amount, if any, payable to Executive pursuant to Article 10, as limited by this Section 10.4. |
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If the accounting firm so engaged by the Company is also serving as accountant or auditor for the individual, entity or group that will control the Company following the Change in Control, the Company may appoint a nationally recognized accounting firm other than the accounting firm engaged by the Company for general audit purposes to make the determinations required hereunder. The Company shall bear all expenses with respect to the determinations by such accounting firm required to be made hereunder. |
(c) | The accounting firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to the Company and Executive within 20 days after the date on which such accounting firm has been engaged to make such determinations or within such other time period as agreed to by the Company and Executive. Any good faith determinations of the accounting firm made hereunder shall be final, binding and conclusive upon the Company and Executive. |
(d) | Notwithstanding the foregoing, in determining the reduction, if any, that shall occur as a result of this Section 10.4, the amounts payable or benefits to be provided to Executive shall be reduced such that the economic loss to Executive as a result of the Excise Tax elimination is minimized. In applying this principle, the reduction shall be made in a manner consistent with the requirements of Section 409A of the Code and where two economically equivalent amounts are subject to reduction but payable at different times, such amounts shall be reduced on a pro rata basis but not below zero. |
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(a) | Competitive Position shall mean any employment, consulting, advisory, directorship, agency, promotional or independent contractor arrangement between Executive and any person or Entity engaged, wholly or in material part, or that is an investor or prospective investor in an Entity that is engaged, wholly or in material part, in the restaurant business that is the same or similar to that in which the Company or any of its subsidiaries or affiliates (collectively, the CBRL Entities) is engaged on the date of the termination of Executives employment, whereby Executive is required to or performs services on behalf of or for the benefit of such person or Entity which are substantially similar to the services in which Executive participated or that she directed or oversaw while employed by the Company. |
(b) | Confidential Information shall mean the proprietary or confidential data, information, documents or materials (whether oral, written, electronic or otherwise) belonging to or pertaining to any of the CBRL Entities, other than Trade Secrets (as defined below), which is of tangible or intangible value to any of the CBRL Entities and the details of which are not generally known to the competitors of the CBRL Entities. Confidential Information shall also include: any items that any of the CBRL Entities have marked CONFIDENTIAL or some similar designation or are otherwise identified as being confidential. |
(c) | Entity or Entities shall mean any business, individual, partnership, joint venture, agency, governmental agency, body or subdivision, association, firm, corporation, limited liability company or other entity of any kind. |
(d) | Restricted Period shall mean, with respect to Section 13.3, four years following the termination of Executives employment (which shall include, without limitation, the circumstances set forth in Section 2.2(b)), and, with respect to Sections 13.4 and 13.5, two years following the termination of Executives employment (which shall include, without limitation, the circumstances set forth in Section 2.2(b)). Notwithstanding the foregoing, the Restricted Period shall be extended for a period of time equal to any period(s) of time that Executive is determined by a final non-appealable judgment from a court of competent jurisdiction to have engaged in any conduct that violates any provision of this Article 13 (the purpose of this provision is to secure for the benefit of the Company the entire Restricted Period being bargained for by the Company for the restrictions upon the Executives activities). |
(e) | Territory shall mean each of the United States of America and any foreign country in which the Company operates its business at the time of the termination of Executives employment. |
(f) | Trade Secrets shall mean information or data of or about any of the CBRL Entities, including, but not limited to, technical or non-technical data, recipes, formulas, patterns, compilations, programs, devices, methods, techniques, drawings, processes, financial data, financial plans, product plans or lists of actual or potential suppliers that: (1) derives economic value, actual or potential, from |
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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; (2) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy; and (3) any other information which is defined as a trade secret under applicable law. |
(g) | Work Product shall mean all tangible work product, property, data, documentation, know-how, concepts or plans, inventions, improvements, techniques and processes relating to any of the CBRL Entities that were conceived, discovered, created, written, revised or developed by Executive during the term of her employment with the Company. |
(a) | In recognition of the need of the CBRL Entities to protect their legitimate business interests, Confidential Information and Trade Secrets, Executive hereby covenants and agrees that Executive shall regard and treat Trade Secrets and all Confidential Information as strictly confidential and wholly-owned by the CBRL Entities and shall not, for any reason, in any fashion, either directly or indirectly, use, sell, lend, lease, distribute, license, give, transfer, assign, show, disclose, disseminate, reproduce, copy, misappropriate or otherwise communicate any such item or information to any third party or Entity for any purpose other than in accordance with this Agreement or as required by applicable law, court order or other legal process: (1) with regard to each item constituting a Trade Secret, at all times such information remains a trade secret under applicable law, and (2) with regard to any Confidential Information, for the Restricted Period. |
(b) | Executive shall exercise best efforts to ensure the continued confidentiality of all Trade Secrets and Confidential Information, and she shall immediately notify the Company of any unauthorized disclosure or use of any Trade Secrets or Confidential Information of which Executive becomes aware. Executive shall assist the CBRL Entities, to the extent necessary, in the protection of or procurement of any intellectual property protection or other rights in any of the Trade Secrets or Confidential Information. |
(c) | All Work Product shall be owned exclusively by the CBRL Entities. To the greatest extent possible, any Work Product shall be deemed to be work made for hire (as defined in the Copyright Act, 17 U.S.C.A. § 101 et seq., as amended), and Executive hereby unconditionally and irrevocably transfers and assigns to the applicable CBRL Entity all right, title and interest Executive currently has or may have by operation of law or otherwise in or to any Work Product, including, without limitation, all patents, copyrights, trademarks (and the goodwill associated therewith), trade secrets, service marks (and the goodwill associated therewith) and other intellectual property rights. Executive agrees to execute and deliver to the applicable CBRL Entity any transfers, assignments, documents or other instruments which the Company may deem necessary or appropriate, from time to time, to protect the rights granted herein or to vest complete title and |
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ownership of any and all Work Product, and all associated intellectual property and other rights therein, exclusively in the applicable CBRL Entity. |
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(a) | Notwithstanding the other provisions hereof, this Agreement is intended to comply with the requirements of Section 409A of the Code, to the extent applicable, and this Agreement shall be interpreted to avoid any penalty sanctions under Section 409A of the Code. Accordingly, all provisions herein, or incorporated by reference, shall be construed and interpreted to comply with Section 409A and, if necessary, any such provision shall be deemed amended to comply with Section 409A and regulations thereunder. If any payment or benefit cannot be provided or made at the time specified herein without incurring sanctions under Section 409A of the Code, then such benefit or payment shall be provided in full at the earliest time thereafter when such sanctions will not be imposed. Except to the extent permitted under Section 409A, in no event may Executive, directly or indirectly, designate the calendar year of any payment |
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under this Agreement. Each payment made under this Agreement shall be treated as a separate payment and the right to a series of installment payments under this Agreement is to be treated as a right to a series of separate payments. |
(b) | Notwithstanding any provision to the contrary in this Agreement, if on the date of the Executives termination of employment, the Executive is a specified employee (as such term is defined in section 409A(a)(2)(B)(i) of the Code and its corresponding regulations) as determined by the Board (or its delegate) in accordance with its specified employee determination policy, then all severance benefits payable to the Executive under this Agreement that constitute deferred compensation subject to the requirements of Section 409A of the Code that are payable to Executive within the six (6) month period following Executives separation from service shall be postponed for a period of six (6) months following Executives separation from service with the Company (or any successor thereto). Any payments delayed pursuant to this Section 15.8(b) will be made in a lump sum on the Companys first regularly scheduled payroll date for Peer Executives that follows such six (6) month period or, if earlier, the date of the Executives death, and any remaining payments required to be made under this Agreement will be paid upon the schedule otherwise applicable to such payments under this Agreement. |
(c) | Notwithstanding any other provision to the contrary, a termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of deferred compensation (as such term is defined in Section 409A of the Code and the Treasury Regulations promulgated thereunder) upon or following a termination of employment unless such termination is also a separation from service from the Company within the meaning of Section 409A of the Code and Section 1.409A-1(h) of the Treasury Regulations and, for purposes of any such provision of this Agreement, references to a separation, termination, termination of employment or like terms shall mean separation from service. |
(d) | Notwithstanding any other provision to the contrary, in no event shall any payment under this Agreement that constitutes deferred compensation for purposes of Section 409A of the Code and the Treasury Regulations promulgated thereunder be subject to offset by any other amount unless otherwise permitted by Section 409A of the Code. |
(e) | To the extent that any reimbursement, fringe benefit or other similar plan or arrangement in which Executive participates during the term of Executives employment under this Agreement or thereafter provides for a deferral of compensation within the meaning of Section 409A of the Code, (1) the amount eligible for reimbursement or payment under such plan or arrangement in one calendar year may not affect the amount eligible for reimbursement or payment in any other calendar year (except that a plan providing medical or health benefits may impose a generally applicable limit on the amount that may be reimbursed or paid); (2) subject to any shorter time periods provided herein or the applicable |
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plans or arrangements, any reimbursement or payment of an expense under such plan or arrangement must be made on or before the last day of the calendar year following the calendar year in which the expense was incurred; and (3) any such reimbursement or payment may not be subject to liquidation or exchange for another benefit, all in accordance with Section 1.409A-3(i)(1)(iv) of the Treasury Regulations. |
(f) | By accepting this Agreement, Executive hereby agrees and acknowledges that the Company does not make any representations with respect to the application of Section 409A of the Code to any tax, economic or legal consequences of any payments payable to Executive hereunder. Additionally, by the acceptance of this Agreement, Executive acknowledges that Executive has obtained independent tax advice regarding the application of Section 409A of the Code to the payments due to Executive hereunder. |
If to Company to: | Cracker Barrel Old Country Store, Inc. Attn: Chief Legal Officer P.O. Box 787 305 Hartmann Drive Lebanon, TN 37088-0787 Facsimile: (615) 443-9818 |
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If to Executive to: | Executives most recent address on file with the Company |
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(a) | The parties shall first use their best efforts to discuss and negotiate a resolution of the dispute. |
(b) | If efforts to negotiate a resolution do not succeed within five business days after a written request for negotiation has been made, a party may submit the dispute to mediation by sending a letter to the other party requesting mediation. The dispute shall be mediated by a mediator agreeable to the parties or, if the parties cannot agree to a mediator, by a mediator selected by the American Arbitration Association. If the parties cannot agree to a mediator within five business days, either party may submit the dispute to the American Arbitration Association for the appointment of a mediator. Mediation shall commence within ten business days after the mediator has been named. |
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(c) | The provisions of this Section 15.16 shall not apply to any dispute relating to the ability of the Company to terminate Executives employment pursuant to Article 5 (Termination for Cause) or Article 9 (Termination Without Cause) of this Agreement nor shall they apply to any action by the Company seeking to enforce its rights arising out of or related to the provisions of Article 13 of this Agreement. |
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CRACKER BARREL OLD COUNTRY STORE, INC. |
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By: | /s/ N.B. Forrest Shoaf | |||
Name: | N.B. Forrest Shoaf | |||
Title: | Senior Vice President, Secretary and Chief Legal Officer | |||
EXECUTIVE |
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/s/ Sandra B. Cochran | ||||
Sandra B. Cochran | ||||
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Acknowledged and Agreed To: COMPANY CRACKER BARREL OLD COUNTRY STORE, INC. |
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By: | ||||
Name: | ||||
Title: | ||||
Date: | ||||
EMPLOYEE |
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Sandra B. Cochran | ||||
Date: | ||||
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(a) | Incentive Bonus. Executive shall be entitled to an annual bonus opportunity, the amount of which shall be determined by the Compensation Committee of the Board (the Committee). The amount of and performance criteria with respect to any such bonus in any year shall be determined not later than the date or time prescribed by Treas. Reg. § 1.162-27(e) in accordance with a formula to be agreed upon by the Company and Executive and approved by the Committee that reflects the financial and other performance of the Company and the Executives contributions thereto. Throughout the Term, the Executives annual target (subject to such performance and other criteria as may be established by the Committee) bonus percentage shall be no less than 100% of the Base Salary. | ||
(b) | Long-Term Incentive Plan. With respect to any long-term incentive plan established by the Company, the Executives target percentage under such a plan shall be no less than 150% of the Base Salary. Any long-term incentive plan award granted during the Term shall provide that (subject to achievement of applicable performance criteria) it shall vest at the earlier of : (1) the regular vesting or performance term of the award, as applicable; or (2) Executives cessation of service as a member of the Board (other than as a result of his voluntary resignation or refusal to stand for reelection). | ||
(c) | Welfare Benefit Plans. During the Term, Executive and Executives eligible dependents shall be eligible for participation in, and shall receive all benefits under, the welfare benefit plans, practices, policies and programs provided by the Company (including, without limitation, medical, prescription, dental, disability, executive life, group life, accidental death and travel accident insurance plans and programs) to the extent applicable generally to Peer Executives. Also, throughout the Term, in addition to participating in the other insurance programs provided to Peer Executives, the Company, for the benefit of Executive, shall pay the |
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premiums to maintain in force during the Term a policy of term life insurance covering the Executive, with such carrier as is reasonably acceptable to the Company and Executive, in the face amount of $2.5 million, with benefits payable to the beneficiary or beneficiaries designated by Executive in writing, or in the absence of such writing, to Executives estate. | |||
(d) | Vacation. Executive shall be entitled to an annual paid vacation commensurate with the Companys established vacation policy for Peer Executives. The timing of paid vacations shall be scheduled in a reasonable manner by Executive. | ||
(e) | Business Expenses. The Company shall reimburse Executive for all reasonable business expenses incurred by Executive during the Term in the performance of Executives services under this Agreement. Executive shall follow the Companys expense procedures that generally apply to Peer Executives in accordance with the policies, practices and procedures of the Company to the extent applicable generally to Peer Executives. | ||
(f) | Perquisites. Executive shall be entitled to receive such executive perquisites, fringe and other benefits as are provided to the most senior executives and their families under any of the Companys plans and/or programs in effect from time to time and such other benefits as are generally available to Peer Executives. | ||
(g) | Clawback of Incentive-Based Compensation. Notwithstanding any other provision to the contrary, any incentive-based compensation within the meaning of Section 10D of the Securities Exchange Act of 1934, as amended (the Exchange Act), will be subject to clawback by the Company in the manner required by Section 10D(b)(2) of the Exchange Act, as determined by the applicable rules and regulations promulgated thereunder from time to time by the U.S. Securities and Exchange Commission. |
(a) | (1) any act by Executive involving fraud, (2) any breach by Executive of applicable regulations of competent authorities in relation to trading or dealing with stocks, securities, investments and the like or (3) any willful or grossly negligent act by Executive resulting in an investigation by the Securities and Exchange Commission, which, in each of cases (1), (2) and (3) above, a majority of the Board determines in its sole and absolute discretion materially adversely affects the Company or Executives ability to perform his duties under this Agreement; |
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(b) | attendance at work in a state of intoxication or otherwise being found in possession at his place of work of any prohibited drug or substance, possession of which would amount to a criminal offense; | ||
(c) | Executives personal dishonesty or willful misconduct in connection with his duties to the Company; | ||
(d) | breach of fiduciary duties to the Company involving personal profit by the Executive; | ||
(e) | conviction of Executive for, or Executive pleading guilty or no contest to, any felony or crime involving moral turpitude; | ||
(f) | material breach by Executive of any provision of this Agreement or of any Company policy adopted by the Board, which breach Executive does not cure within 15 days after the Company provides written notice of such breach to Executive; or | ||
(g) | the continued failure of Executive to perform substantially Executives duties with the Company (other than any such failure resulting from incapacity due to Disability, and specifically excluding any failure by Executive, after good faith, reasonable and demonstrable efforts, to meet performance expectations for any reason), after a written demand for substantial performance is delivered to Executive by a majority of the Board that specifically identifies the manner in which such Board believes that Executive has not substantially performed Executives duties. |
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(a) | other than his removal for Cause pursuant to Section 5 and subject to the provisos below, without the prior written consent of Executive, the assignment to Executive of any duties inconsistent in any material respect with Executives position (including status, offices (inclusive of Chairman of the Board), titles and reporting requirements), authority, duties or responsibilities as in effect on the Effective Date, or any other action by the Company which results in a demonstrable diminution in such position, authority, duties or responsibilities; provided, however, that an isolated, insubstantial and inadvertent action not taken in bad faith, which is remedied by the Company promptly after receipt of written notice thereof given by Executive, shall not constitute Good Reason; |
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(b) | a reduction by the Company in Executives Base Salary as in effect on the Effective Date or as the same may be increased from time to time, unless such reduction is a part of an across-the-board decrease in base salaries affecting all Peer Executives which reduction is approved by the Committee; provided, however, that in any event, the Company shall not reduce Executives Base Salary below 90% of the Base Salary as in effect on the Effective Date; | ||
(c) | a reduction by the Company in Executives (1) annual target bonus percentage to which Executive is entitled pursuant to Section 4.2(a) or (2) target percentage under any long-term incentive plan established by the Company to which Executive is entitled pursuant to Section 4.2(b), unless, in either case (1) or (2), such reduction is a part of an across-the-board proportional decrease in annual target bonuses percentages or target percentages under any long-term incentive plan, as applicable, affecting all other Peer Executives, which reduction is approved by the Committee; provided, however, that in any event, the Company shall not reduce Executives annual target bonus below 90% of the Base Salary as in effect on the Effective Date; | ||
(d) | a reduction by the Company of benefits under (1) a pension plan or arrangement or (2) a compensation plan or arrangement in which Executive participates, or the elimination of Executives participation in any such plan or arrangement which reduction or elimination results in a reduction, in the aggregate, of the benefits provided thereunder, taking into account any replacement plan or arrangement or other additional compensation provided to Executive in connection with or following such reduction or elimination (except for immaterial reductions or across-the-board plan changes or terminations similarly affecting other Peer Executives); provided, that, subject to Section 15.8, in the event of any such changes or terminations, the Company shall timely pay or provide to Executive any accrued amounts or accrued benefits required to be paid or provided or which Executive is eligible to receive under any such plan or arrangement in accordance with the terms of such plan or arrangement; | ||
(e) | the Company requiring Executive, without his consent, to be based at any office or location more than 50 miles from the Companys current headquarters in Lebanon, Tennessee; | ||
(f) | the material breach by the Company of any provision of this Agreement; or | ||
(g) | the failure of any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. |
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(a) | The Company shall pay to Executive immediately following the expiration of the 30-day period beginning on the date of Executives termination of employment (such 30-day period, the Severance Delay Period), provided, that Executive has executed and delivered the Release and any revocation period applicable to such Release shall have expired as of the end of the Severance Delay Period, the aggregate of the following amounts: |
(1) | in a lump sum in cash, immediately following the end of the Severance Delay Period, the sum of (i) Executives Base Salary then in effect through the date of termination to the extent not theretofore paid, (ii) a pro-rata portion of amounts payable under any then existing incentive or bonus plan applicable to Executive (including, without limitation, any incentive bonus referred to in Section 4.2(a)) for that portion of the fiscal year in |
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which the termination of employment occurs through the date of termination, (iii) any accrued expenses and vacation pay to the extent not theretofore paid, and (iv) unless Executive has elected a different payout date in a prior deferral election, any compensation previously deferred by Executive (together with any accrued interest or earnings thereon) to the extent not theretofore paid (the sum of the amounts described in subsections (i), (ii), (iii) and (iv) shall be referred to in this Agreement as the Accrued Obligations); provided, that the amount described in subsection 9.1(a)(1)(ii) shall be paid as soon as practicable after the end of the fiscal year to which such bonus relates and the amount that is pro-rated for Executives length of service during the year shall be determined by the actual performance of the Company during such year; and | |||
(2) | in installments ratably over 24 months in accordance with the Companys normal payroll cycle and procedures, the amount equal to 1.5 times Executives annual Base Salary in effect as of the date of termination. |
(b) | All stock options (or stock units or restricted shares) held by the Executive that are vested prior to the effective date of the termination shall be exercisable in accordance with their terms. With respect to any stock options (or stock units or restricted shares) held by the Executive that, by their terms do not immediately vest and become exercisable upon a termination of employment without Cause, the Executive shall receive a lump sum cash distribution equal: (i) in the case of stock options, to: (A) the number of shares of the Companys $0.01 par value common stock (Shares) that is subject to options held by the Executive which are not vested on the date of termination of employment; multiplied by (B) the difference between: (1) the closing price of a Share as of the day prior to the effective date of termination of employment (or, if the United States securities trading markets are closed on that date, on the last preceding date on which the United States securities trading markets were open for trading), and (2) the applicable exercise price(s) of the non-vested options; and (ii) in the case of stock units or restricted shares, to: (A) the number of Shares (at target) that is subject to units held by the Executive which are not vested on the date of termination of employment; multiplied by (B) the closing price of a Share as of the day prior to the effective date of termination of employment (or, if the United States securities trading markets are closed on that date, on the last preceding date on which the United States securities trading markets were open for trading). | ||
(c) | The Executives participation in the life and medical insurance programs in effect on the date of termination of employment shall continue until the later of (i) 18 months after Executives date of termination of employment, or (ii) the expiration of the Term (as in effect at the time of termination); provided, however, that notwithstanding the foregoing, the Company shall not be obligated to provide such benefits if Executive becomes employed by another employer and is covered or permitted to be covered by that employers benefit plans without regard to the extent of such coverage; and provided further that upon the Executives becoming eligible for and covered by Medicare, the medical coverage required by this |
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subsection will be converted to an obligation on the part of the Company to reimburse the Executive for premiums paid to purchase Medicare Supplement coverage during any remaining period of time referred to in subsection (c)(i) above. | |||
(d) | To the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any other accrued amounts or accrued benefits required to be paid or provided or which Executive is eligible to receive under any plan, program, policy, practice, contract or agreement of the Company (such other amounts and benefits shall be referred to in this Agreement as the Other Benefits). | ||
(e) | Notwithstanding anything in this Agreement to the contrary, in the event that the Executives employment is terminated by the Company without Cause prior to the expiration of the Term, the provisions of Section 13.5 shall not apply to the Executives activities during the Restricted Period. |
(a) | The Company shall pay to Executive immediately following the expiration of the Severance Delay Period, provided, that Executive has executed and delivered the Release and any revocation period applicable to such Release shall have expired as of the end of the Severance Delay Period, the aggregate of the following amounts: |
(1) | the Accrued Obligations (as defined in Section 9(a)(1), except that solely for purposes of this Section 10.2(a)(1), Executives target bonus shall be prorated based solely on the portion of the fiscal year in which the termination of employment occurs through the date of termination (and not on the Companys actual performance for such period) and such prorated amount shall be paid contemporaneously with the amounts payable pursuant to Section 10.2(a)(2))); and | ||
(2) | the amount determined by multiplying two times the sum of (A) Executives average annual Base Salary for the five fiscal years prior to the termination, and (B) Executives Applicable Annual Bonus (as defined |
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below). For purposes of this Agreement, Applicable Annual Bonus means the greater of Executives actual annual incentive bonus from the Company earned in the fiscal year immediately preceding the fiscal year in which Executives termination date falls or Executives target annual incentive bonus for the year in which Executives termination date falls. |
(b) | All stock options (or stock units or restricted shares) held by Executive that are vested (including, without limitation, those vested by reason of any Change in Control occurring prior to the Executives termination) prior to the effective date of the termination shall be exercisable in accordance with their terms. With respect to any stock options held by Executive that, by their terms do not immediately vest and become exercisable upon a termination of employment without Cause, Executive shall receive a lump sum cash distribution equal (i) in the case of stock options, to: (A) the number of Shares that is subject to options held by the Executive which are not vested on the date of termination of employment; multiplied by (B) the difference between: (1) the closing price of a Share as of the day prior to the effective date of termination of employment (or, if the United States securities trading markets are closed on that date, on the last preceding date on which the United States securities trading markets were open for trading), and (2) the applicable exercise price(s) of the non-vested options and (ii) in the case of stock units or restricted shares, to: (A) the number of Shares (at target) that is subject to units held by the Executive which are not vested on the date of termination of employment; multiplied by (B) the closing price of a Share as of the day prior to the effective date of termination of employment (or, if the United States securities trading markets are closed on that date, on the last preceding date on which the United States securities trading markets were open for trading). | ||
(c) | Executives participation in the life and medical insurance programs in effect on the date of termination of employment shall continue until the later of (i) 18 months after Executives date of termination of employment, or (ii) the expiration of the Term (as in effect at the time of termination); provided, however, that notwithstanding the foregoing, the Company shall not be obligated to provide such benefits if Executive becomes employed by another employer and is covered or permitted to be covered by that employers benefit plans without regard to the extent of such coverage; and provided further, that upon the Executives becoming eligible for and covered by Medicare, the medical coverage required by this subsection will be converted to an obligation on the part of the Company to reimburse the premiums paid by the Executive to purchase Medicare Supplement coverage during any remaining period of time referred to in subsection 10.2(c)(i) above. | ||
(d) | To the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any Other Benefits (as defined in Section 9.1(d)). |
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(a) | any person (as defined in Section 13(h)(8)(E) of the Exchange Act), other than the Company or any of its subsidiaries or any employee benefit plan of the Company or any of its subsidiaries, becomes the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company (or any successor to all or substantially all of the Companys assets) representing more than 35% of the combined voting power of the Companys (or such successors) then outstanding voting securities that may be cast for the election of directors of the Company (other than as a result of an issuance of securities initiated by the Company (or such successor) in the ordinary course of business); | ||
(b) | as the result of, or in connection with, any cash tender or exchange offer, merger or other business combination or contested election, or any combination of the foregoing transactions, less than a majority of the combined voting power of the then outstanding securities of the Company or any successor company or entity entitled to vote generally in the election of the directors of the Company or such other corporation or entity after such transaction are held in the aggregate by the holders of the Companys securities entitled to vote generally in the election of directors of the Company immediately prior to such transaction; | ||
(c) | all or substantially all of the assets of the Company are sold, exchanged or otherwise transferred; | ||
(d) | the Companys shareholders approve a plan of liquidation or dissolution of the Company; or | ||
(e) | during the Term, Continuing Directors cease for any reason to constitute at least a majority of the Board. For this purpose, a Continuing Director is any person who at the beginning of the Term was a member of the Board, or any person first elected to the Board during the Term whose election, or the nomination for election by the Companys shareholders, was approved by a vote of at least two-thirds of the Continuing Directors then in office, but excluding any person (1) initially appointed or elected to office as result of either an actual or threatened election and/or proxy contest by or on behalf of any person or group (within the meaning of Section 13(d) of the Exchange Act) other than the Board, or (2) designated by any person or group (within the meaning of Section 13(d) of the Exchange Act) ) who has entered into an agreement with the Company to effect a transaction described in Section 10.3(a) through (d). |
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(a) | Notwithstanding any other provision to the contrary, if any payments or benefits Executive would receive from the Company pursuant to this Agreement or otherwise (collectively, the Payments) would, either separately or in the aggregate, (i) constitute parachute payments within the meaning of Section 280G of the Code, and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the Excise Tax), then the Payments will be equal to the Reduced Amount (defined below). The Reduced Amount will be either (1) the entire amount of the Payments, or (2) an amount equal to the largest portion of the Payments that would result in no portion of any of the Payments (after reduction) being subject to the Excise Tax, whichever amount after taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate, net of the maximum reduction in federal income taxes which could be obtained from a deduction of such state and local taxes), results in the Executives receipt, on an after-tax basis, of the greatest amount of the Payments. If a reduction in the Payments is to be made so that the amount of the Payments equals the Reduced Amount, the Payments will be paid only to the extent permitted under the Reduced Amount alternative; provided, that in the event the Reduced Amount is paid, the cash payments set forth in Section 10.2(a)(2) shall be reduced as required by the operation of this Section 10.4(a). | ||
(b) | The accounting firm engaged by the Company for general audit purposes as of the day prior to the effective date of the Change in Control shall perform any calculation necessary to determine the amount, if any, payable to Executive pursuant to this Section 10, as limited by this Section 10.4. If the accounting firm so engaged by the Company is also serving as accountant or auditor for the individual, entity or group that will control the Company following a Change in Control, the Company shall appoint a nationally recognized accounting firm other than the accounting firm engaged by the Company for general audit purposes to make the determinations required hereunder. The Company shall bear all expenses with respect to the determinations by such accounting firm required to be made hereunder. | ||
(c) | The accounting firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to the Company and Executive within 20 calendar days after the date on which such accounting firm has been engaged to make such determinations or such other time as requested by the Company or Executive. Any good faith determinations of the accounting firm made hereunder shall be final, binding, and conclusive upon the Company and Executive. |
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(a) | Competitive Position shall mean any employment, consulting, advisory, directorship, agency, promotional or independent contractor arrangement between Executive and any person or Entity engaged, wholly or in material part, or that is an investor or prospective investor in an Entity that is engaged, wholly or in material part, in the restaurant business that is the same or similar to that in which the Company or any of its subsidiaries or affiliates (collectively, the CBRL Entities) is engaged on the date of the termination of Executives employment, whereby Executive is required to or performs services on behalf of or for the benefit of such person or Entity which are substantially similar to the services in which Executive participated or that he directed or oversaw while employed by the Company. | ||
(b) | Confidential Information shall mean the proprietary or confidential data, information, documents or materials (whether oral, written, electronic or otherwise) belonging to or pertaining to any of the CBRL Entities, other than Trade Secrets (as defined below), which is of tangible or intangible value to any of the CBRL Entities and the details of which are not generally known to the competitors of the CBRL Entities. Confidential Information shall also include: any items that any of the CBRL Entities have marked CONFIDENTIAL or some similar designation or are otherwise identified as being confidential. | ||
(c) | Entity or Entities shall mean any business, individual, partnership, joint venture, agency, governmental agency, body or subdivision, association, firm, corporation, limited liability company or other entity of any kind. | ||
(d) | Restricted Period shall mean two years following termination of Executives employment hereunder; provided, however that the Restricted Period shall be extended for a period of time equal to any period(s) of time within the two-year |
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period following termination of Executives employment hereunder that Executive is determined by a final non-appealable judgment from a court of competent jurisdiction to have engaged in any conduct that violates this Article 13 or any sections thereof, the purpose of this provision being to secure for the benefit of the Company the entire Restricted Period being bargained for by the Company for the restrictions upon the Executives activities. | |||
(e) | Territory shall mean each of the United States of America and any foreign country in which the Company operates its business at the time of the termination of Executives employment. | ||
(f) | Trade Secrets shall mean information or data of or about any of the CBRL Entities, including, but not limited to, technical or non-technical data, recipes, formulas, patterns, compilations, programs, devices, methods, techniques, drawings, processes, financial data, financial plans, product plans or lists of actual or potential suppliers that: (1) derives 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; (2) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy; and (3) any other information which is defined as a trade secret under applicable law. | ||
(g) | Work Product shall mean all tangible work product, property, data, documentation, know-how, concepts or plans, inventions, improvements, techniques and processes relating to any of the CBRL Entities that were conceived, discovered, created, written, revised or developed by Executive during the term of his employment with the Company. |
(a) | In recognition of the need of the CBRL Entities to protect their legitimate business interests, Confidential Information and Trade Secrets, Executive hereby covenants and agrees that Executive shall regard and treat Trade Secrets and all Confidential Information as strictly confidential and wholly-owned by the CBRL Entities and shall not, for any reason, in any fashion, either directly or indirectly, use, sell, lend, lease, distribute, license, give, transfer, assign, show, disclose, disseminate, reproduce, copy, misappropriate or otherwise communicate any such item or information to any third party or Entity for any purpose other than in accordance with this Agreement or as required by applicable law, court order or other legal process: (1) with regard to each item constituting a Trade Secret, at all times such information remains a trade secret under applicable law, and (2) with regard to any Confidential Information, for the Restricted Period. | ||
(b) | Executive shall exercise best efforts to ensure the continued confidentiality of all Trade Secrets and Confidential Information, and he shall immediately notify the Company of any unauthorized disclosure or use of any Trade Secrets or Confidential Information of which Executive becomes aware. Executive shall |
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assist the CBRL Entities, to the extent necessary, in the protection of or procurement of any intellectual property protection or other rights in any of the Trade Secrets or Confidential Information. | |||
(c) | All Work Product shall be owned exclusively by the CBRL Entities. To the greatest extent possible, any Work Product shall be deemed to be work made for hire (as defined in the Copyright Act, 17 U.S.C.A. § 101 et seq., as amended), and Executive hereby unconditionally and irrevocably transfers and assigns to the applicable CBRL Entity all right, title and interest Executive currently has or may have by operation of law or otherwise in or to any Work Product, including, without limitation, all patents, copyrights, trademarks (and the goodwill associated therewith), trade secrets, service marks (and the goodwill associated therewith) and other intellectual property rights. Executive agrees to execute and deliver to the applicable CBRL Entity any transfers, assignments, documents or other instruments which the Company may deem necessary or appropriate, from time to time, to protect the rights granted herein or to vest complete title and ownership of any and all Work Product, and all associated intellectual property and other rights therein, exclusively in the applicable CBRL Entity. |
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(a) | The parties intend that (1) each payment or installment of payments provided under this Agreement will be a separate payment for purposes of Section 409A of the Code, and (2) the payments will satisfy, to the greatest extent possible, the exemptions from the application of Section 409A of the Code, including those provided under Treasury Regulations 1.409A-1(b)(4) (regarding short-term deferrals), 1.409A-1(b)(9)(iii) (regarding the two-times, two-year exception), and 1.409A-1(b)(9)(v) (regarding reimbursements and other separation pay). Notwithstanding any other provision to the contrary, if (x) on the date the Executives employment with the Company terminates or at such other time that is relevant under Section 409A of the Code, the Company determines that Executive is a specified employee (as such term is defined under Treasury Regulation 1.409A-1(i)(1)) of the Company and (y) the Company determines that any payments to be provided to Executive pursuant to this Agreement are or may become subject to the additional tax under Section 409A(a)(1)(B) of the Code or any other taxes or penalties imposed under Section 409A of the Code if provided at the time otherwise required under this Agreement, then such payments will be delayed until the date that is six months after the date of the Executives termination of employment with the Company or, if earlier, the date of the Executives death. Any payments delayed pursuant to this Section 16.8(a) will be made in a lump sum on the first day of the seventh month following the Executives termination of employment or, if earlier, the date of the Executives death, and any remaining payments required to be made under this Agreement will be paid upon the schedule otherwise applicable to such payments under this Agreement. | ||
(b) | Notwithstanding any other provision to the contrary, a termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of deferred compensation (as such term is defined in Section 409A of the Code and the Treasury Regulations promulgated thereunder) upon or following a termination of employment unless such termination is also a separation from service from the Company within the meaning of Section 409A of the Code and Section 1.409A-1(h) of the Treasury Regulations and, for purposes of any such provision of this Agreement, references to a separation, termination, termination of employment or like terms shall mean separation from service. |
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(c) | Notwithstanding any other provision to the contrary, in no event shall any payment under this Agreement that constitutes deferred compensation for purposes of Section 409A of the Code and the Treasury Regulations promulgated thereunder be subject to offset by any other amount unless otherwise permitted by Section 409A of the Code. | ||
(d) | For the avoidance of doubt, any payment due under this Agreement within a period following the Executives termination of employment or other event, shall be made on a date during such period as determined by the Company in its sole discretion. | ||
(e) | It is intended that this Agreement, to the extent practicable, comply and be interpreted in accordance with Section 409A of the Code, and the Company shall, as necessary, adopt such conforming amendments as are necessary to comply with Section 409A of the Code without reducing the benefits payable hereunder without the express written consent of Executive. | ||
(f) | To the extent that any reimbursement, fringe benefit or other similar plan or arrangement in which Executive participates during the term of Executives employment under this Agreement or thereafter provides for a deferral of compensation within the meaning of Section 409A of the Code, (1) the amount eligible for reimbursement or payment under such plan or arrangement in one calendar year may not affect the amount eligible for reimbursement or payment in any other calendar year (except that a plan providing medical or health benefits may impose a generally applicable limit on the amount that may be reimbursed or paid); (2) subject to any shorter time periods provided herein or the applicable plans or arrangements, any reimbursement or payment of an expense under such plan or arrangement must be made on or before the last day of the calendar year following the calendar year in which the expense was incurred; and (3) any such reimbursement or payment may not be subject to liquidation or exchange for another benefit, all in accordance with Section 1.409A-3(i)(1)(iv) of the Treasury Regulations. | ||
(g) | By accepting this Agreement, Executive hereby agrees and acknowledges that the Company does not make any representations with respect to the application of Section 409A of the Code to any tax, economic or legal consequences of any payments payable to Executive hereunder. Additionally, by the acceptance of this Agreement, Executive acknowledges that (1) Executive has obtained independent tax advice regarding the application of Section 409A of the Code to the payments due to Executive hereunder; (2) Executive retains full responsibility for the potential application of Section 409A of the Code to the tax and legal consequences of payments payable to Executive hereunder; and (3) the Company shall not indemnify or otherwise compensate Executive for any violation of Section 409A of the Code that may occur in connection with this Agreement. | ||
(h) | Notwithstanding any other provision to the contrary, in the event that Executives separation from service occurs in connection with an exit incentive program or |
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other employment termination program offered to a group or class of employees, as defined under the Older Worker Benefit Protection Act, 29 U.S.C. Section 626, the Severance Delay Period shall mean the period beginning the termination of Executives employment and ending on the 60th day thereafter. |
If to Company to: | Cracker Barrel Old Country Store, Inc. | |||
Attn: Chief Legal Officer | ||||
P.O. Box 787 | ||||
305 Hartmann Drive | ||||
Lebanon, TN 37088-0787 | ||||
Facsimile: (615) 443-9818 | ||||
If to Executive to: | Executives most recent address on file with the Company |
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(a) | The parties shall first use their best efforts to discuss and negotiate a resolution of the dispute. | ||
(b) | If efforts to negotiate a resolution do not succeed within five business days after a written request for negotiation has been made, a party may submit the dispute to mediation by sending a letter to the other party requesting mediation. The dispute shall be mediated by a mediator agreeable to the parties or, if the parties cannot agree to a mediator, by a mediator selected by the American Arbitration Association. If the parties cannot agree to a mediator within five business days, either party may submit the dispute to the American Arbitration Association for the appointment of a mediator. Mediation shall commence within ten business days after the mediator has been named. | ||
(c) | The provisions of this Section 16.16 shall not apply to any dispute relating to the ability of the Company to terminate Executives employment pursuant to Article 5 (Termination for Cause) or Article 9 (Termination Without Cause) of this Agreement nor shall they apply to any action by the Company seeking to enforce its rights arising out of or related to the provisions of Article 13 of this Agreement. |
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CRACKER BARREL OLD COUNTRY STORE, INC. |
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By: | /s/ Sandra B. Cochran | |||
Name: | Sandra B. Cochran | |||
Title: | President and Chief Executive Officer | |||
EXECUTIVE |
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/s/ Michael A. Woodhouse | ||||
Michael A. Woodhouse | ||||
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(a) | claims for violations of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967, the Fair Labor Standards Act, the Civil Rights Act of 1866, the Civil Rights Act of 1991, the Older Workers Benefit Protection Act of 1990, the Americans With Disabilities Act, the Equal Pay Act of 1963, the Family and Medical Leave Act, 42 U.S.C. § 1981, the |
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Worker Adjustment and Retraining Notification Act, the National Labor Relations Act, the Labor Management Relations Act, Executive Order 11246, Executive Order 11141, the Rehabilitation Act of 1973, or the Employee Retirement Income Security Act, the Tennessee Human Rights Act, the Tennessee Employment of the Handicapped Act, the Genetic Information Nondiscrimination Act, or any other law relating to discrimination or retaliation in employment (in each case, as amended); | |||
(b) | claims for violations of any other federal or state statute or regulation or local ordinance; | ||
(c) | claims for lost or unpaid wages, compensation, or benefits, defamation, intentional or negligent infliction of emotional distress, assault, battery, wrongful or constructive discharge, negligent hiring, retention or supervision, misrepresentation, conversion, tortious interference, breach of contract, or breach of fiduciary duty; | ||
(d) | claims to benefits under any bonus, severance, workforce reduction, early retirement, outplacement, or any other similar type plan sponsored by the Company; or | ||
(e) | any other claims under state law arising in tort or contract. |
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Acknowledged and Agreed To: COMPANY CRACKER BARREL OLD COUNTRY STORE, INC. |
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By: | ||||
Its: | ||||
Date: | ||||
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