AMENDED AND RESTATED MANAGEMENT CHANGE OF CONTROL SEVERANCE AGREEMENT
Exhibit 10.2
AMENDED
AND RESTATED
This
Amended and Restated Management Change of Control Severance Agreement (this
“Agreement”) is dated this
day of ,
(the “Effective Date”), by and among Cabela’s Incorporated, a Delaware
corporation (the “Company”), and
(the “Executive”).
WHEREAS,
the Executive and the Company are parties to an existing Management Change of
Control Severance Agreement (the “Original Agreement”);
(d) Change in
Control. “Change in Control” shall mean the occurrence of any
of the following events:
(i) any
transaction that would result and does result in the reorganization, merger or
consolidation of the Company, with one or more other Persons, other than a
transaction following which:
(A) at
least fifty-one percent (51%) of the equity ownership interests of the entity
resulting from such transaction are Beneficially Owned by Persons who,
immediately prior to such transaction, Beneficially Owned at least fifty-one
percent (51%) of the outstanding equity ownership interests in the
Company. For purposes of this Section 1(d), the term “Beneficially
Owned” or “Beneficial Ownership” shall have the meaning ascribed to it under
Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”) and the terms “Person” or “Persons” shall have the meaning
ascribed to them under Sections 13(d) and 14(d) of the Exchange Act;
and
(B) at
least fifty-one percent (51%) of the securities entitled to vote generally in
the election of directors of the entity resulting from such transaction are
Beneficially Owned by Persons who, immediately prior to such transaction,
Beneficially Owned at least fifty-one percent (51%) of the securities entitled
to vote generally in the election of directors of the Company;
(ii) the
consummation of the sale or other disposition of all or substantially all of the
assets of the Company, except for any such transaction which does not result in
a Change in Control under Section 1(d)(v);
(iii) an
acquisition (other than directly from the Company) of any voting securities of
the Company (the “Voting Securities”) by any Person, immediately after which
such Person has Beneficial Ownership of more than fifty percent (50%) of the
combined voting power of the Company’s then outstanding Voting
Securities;
(iv) a
complete liquidation or dissolution of the Company;
2
(v) the
occurrence of any event if, immediately following such event, members of the
Board who belong to any of the following groups do not aggregate at least a
majority of the Board:
(A) individuals
who were members of the Board on the Effective Date of this Agreement;
or
(B) individuals
who first became members of the Board after the Effective Date of this Agreement
but prior to such event either:
(1) upon
election to serve as a member of the Board by the affirmative vote of
three-quarters of the members of the Board, or of a nominating committee
thereof, in office at the time of such first election; or
(2) upon
election by the stockholders of the Company to serve as a member of the Board,
but only if nominated for election by the affirmative vote of three-quarters of
the members of the Board, or of a nominating committee thereof, in office at the
time of such first nomination; provided that such individual’s election or
nomination did not result from an actual or threatened election contest or other
actual or threatened solicitation of proxies or consents other than by or on
behalf of the Board;
provided,
however, in no event shall a “Change in Control” be deemed to have occurred as a
result of any acquisition of securities or assets of the Company or a subsidiary
of the Company, by the Company, any subsidiary of the Company or by any employee
benefit plan maintained by the Company.
(i) if
the Executive’s employment is terminated by the Company for Cause, or by the
Executive for Good Reason, the date of receipt of the Notice of Termination or
such later date specified in the Notice of Termination, as the case may
be;
(ii) if
the Executive’s employment is terminated by the Company other than for Cause or
Disability, the date on which the Company notifies the Executive of such
termination;
(iii) if
the Executive resigns without Good Reason, the date on which the Executive
notifies the Company of such termination; and
(iv) if
the Executive’s employment is terminated by reason of death or Disability, the
date of death or Disability of the Executive, as the case may be.
3
(i) a
material diminution in the Executive’s base compensation;
(ii) a
material diminution in the Executive’s authority, duties or
responsibilities;
(iii) a
material diminution in the authority, duties or responsibilities of the
supervisor to whom the Executive is required to report, including, if the
Executive reports directly to the Board, a requirement that the Executive report
to a corporate officer or employee instead of reporting directly to the
Board;
(iv) a
material diminution in the budget over which the Executive retains
authority;
(v) a
change in the Executive’s principal place of employment by a distance in excess
of one hundred (100) miles from its location immediately prior to the Change in
Control;
(vi) any
other action or inaction that constitutes a material breach by the Company of an
agreement under which the Executive provides services to the Company;
or
(vii) The
failure by the Company to obtain the assumption of and agreement to perform this
Agreement by any successor as contemplated in Section 9.
In order
to invoke a termination for Good Reason, the Executive shall provide written
notice to the Company of the existence of one or more of the conditions
described in clauses (i) through (vii) within 90 days following the
Executive’s knowledge of the initial existence of such condition or conditions,
specifying in reasonable detail the conditions constituting Good Reason, and the
Company shall have 30 days following receipt of such written notice (the “Cure
Period”) during which it may remedy the condition. In the event that the Company
fails to remedy the condition constituting Good Reason during the applicable
Cure Period, the Executive’s “separation from service” (within the meaning of
Section 409A of the Code) must occur, if at all, within two years following
such Cure Period in order for such termination as a result of such condition to
constitute a termination for Good Reason. The Executive’s mental or
physical incapacity following the occurrence of an event described above in
clauses (i) through (vii) shall not affect the Executive’s
ability to terminate employment for Good Reason and the Executive’s death
following delivery of a Notice of Termination for Good Reason shall not affect
the Executive’s estate’s entitlement to severance payments benefits provided
hereunder upon a termination of employment for Good Reason.
4
(a) The
Company shall pay to the Executive in a lump sum as of the Date of Termination
(and in all events within 30 days of the Date of Termination) a cash severance
amount equal to 2.99 times the Executive’s Annual Compensation;
(b) The
Company shall continue, for an eighteen (18) month period from the Date of
Termination, the Executive’s participation in the Company’s group medical,
dental, life and disability insurance programs and, if applicable, Medicare
supplemental coverages (“Continued Benefits”). The Continued Benefits
shall be provided by the Company at the same premium to the
Executive, and at the same coverage levels in effect immediately prior to the
Date of Termination. The Continued Benefits shall be provided to the
Executive in compliance with the terms of COBRA; provided that in the event that
the Executive’s participation in any plan as provided in this Section 2(b) is
barred by the underlying service provider or insurance carrier used by the
Company to provide such benefits, or during such period any such plan is
discontinued, the Company shall arrange to either provide the Executive with
benefits substantially similar to those which the Executive was entitled to
receive under such plans immediately prior to the Date of Termination or a cash
amount equal to the cost the Company would have incurred to provide for such
benefits for the remainder of the continuation period. The Continued
Benefits will be discontinued prior to the end of the eighteen (18) month
period in the event the Executive receives substantially similar benefits from a
subsequent employer, as determined in good faith by the Board. For
purposes of enforcing this Section 2(b), to the extent necessary for the Company
to make an off-set deduction, the Executive shall have a duty to keep the
Company informed as to the terms and conditions of any subsequent employment and
the corresponding benefits from employment and shall provide or cause to provide
to the Company, in writing, correct, complete and timely information concerning
the same;
5
(c) All
unvested stock options, restricted stock, restricted stock units or other equity
interests of the Company issued to the Executive under the Equity Plans or
otherwise that are subject only to time vesting and are not performance stock or
performance units shall fully vest on the Date of Termination (and in all events
within 30 days of the Date of Termination) to the extent such options,
restricted stock, restricted stock units or other equity interests do not
otherwise vest upon the change of control as defined in the applicable Equity
Plan or agreement;
(d) All
performance stock or performance units of the Company issued to the Executive
under the Equity Plans that are intended to qualify for the performance-based
compensation exception provided by Section 162(m) of the Code shall be prorated
to the Date of Termination and paid on actual performance at the end of the
performance period (and in all events not later than March 15th
following the end of the performance period) to the extent such performance
stock or performance units do not otherwise vest upon the change of control as
defined in the applicable Equity Plan or agreement; and
(e) Section
6(b) (Development of Intellectual Property) of this Agreement and similar
provisions (including non-competition and non-solicitation provisions but
excluding confidentiality provisions) in other agreements between the Executive
and the Company shall be terminated and of no further force and effect as of the
Date of Termination, but Section 6(a) (Nondisclosure of Confidential
Information) of this Agreement and similar confidentiality provisions in other
agreements between the Executive and the Company shall remain in full force and
effect after the Date of Termination.
(a) The
Executive shall not be required to mitigate the amount of any benefits under
this Agreement by seeking other employment or otherwise. The amount
of severance to be provided pursuant to Section 2 shall not be reduced by any
compensation earned by the Executive as a result of employment by another
employer after the Date of Termination or otherwise.
(b) If
the Executive is entitled to severance compensation under this Agreement and
severance benefits under any other agreement between the Company and the
Executive, such entitlement shall not be cumulative, and the Executive shall be
entitled to the benefits under either this Agreement or the other agreement
between the Company and the Executive, whichever is greater.
(a) Nothing
contained in this Agreement shall be deemed to create other than a terminable at
will employment relationship between the Company and the Executive, and the
Company may terminate the Executive’s employment at any time, subject to
providing any payments specified in this Agreement in accordance with the terms
of this Agreement.
6
(b) Nothing
contained in this Agreement shall create or require the Company to create a
trust of any kind to fund any benefits which may be payable under this
Agreement, and to the extent that the Executive acquires a right to receive
benefits from the Company under this Agreement, such right shall be no greater
than the right of any unsecured general creditor of the Company.
7
8
(a) Except
as required by law, no right to receive payments under this Agreement shall be
subject to anticipation, commutation, alienation, sale, assignment, encumbrance,
charge, pledge or hypothecation, or to execution, attachment, levy or similar
process or assignment by operation of law, and any attempt, voluntary or
involuntary, to affect any such action shall be null, void and of no
effect.
(b) This
Agreement shall be binding upon, and inure to the benefit of, the Executive, the
Company and their respective successors and permitted assigns.
To the Company:
Cabela’s Incorporated
Xxx Xxxxxx Xxxxx
Xxxxxx,
XX 00000
Attention: Legal
Department
9
To the Executive:
At the most recent address on file at
the Company
13. Governing
Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the United States
where applicable and otherwise by the substantive laws of the State of
Delaware.
10
[The
Remainder of This Page Intentionally Left Blank.]
[Signature
Page Follows.]
11
CABELA’S
INCORPORATED, a Delaware corporation
|
||
By
|
||
Its
|
||
[Executive]
|
Management
Severance Agreement
Signature
Page