EMPLOYMENT AGREEMENT
EXHIBIT 10.1
This EMPLOYMENT AGREEMENT (the “Agreement”), effective as of September 15, 2007, is made and
entered into by and between FLOWERS FOODS, INC., a Georgia corporation (“Flowers”) and XXXXX X.
XXXXXXXX, an individual resident of Georgia (herein referred to as the “Employee”):
WITNESSETH:
WHEREAS, Flowers desires to retain Employee to serve in the capacity of adviser to the
Chairman, CEO and President of Flowers on financial and related matters, upon the terms and
conditions hereinafter set forth; and
WHEREAS, Employee desires to enter into this Agreement with respect to Employee’s services
upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and obligations contained herein,
Flowers and Employee agree as follows:
1. Resignation from Office. Flowers and Employee agree that Employee has voluntarily
resigned as Senior Vice President and Chief Financial Officer of Flowers and in all other officer
positions relating to any affiliate of Flowers as of September 15, 2007 (the “Effective Date”).
After the Effective Date, Employee’s employment with Flowers shall be governed solely by this
Agreement.
2. Termination of Prior Agreements. Flowers and Employee mutually agree that any and
all employment, separation or similar agreements between Flowers and Employee (and/or any of their
respective affiliates) prior to the date hereof are hereby terminated effective on the Effective
Date, it being understood that any outstanding equity award agreements pursuant to the Flowers
Foods, Inc. Equity and Performance Incentive Plan by and between Flowers and Employee (the “Equity
Award Agreements”) continue in full force and effect.
3. Employment. Flowers agrees to retain Employee, and Employee agrees to serve
Flowers, for a period commencing on the Effective Date and terminating on February 28, 2010 (the
“Employment Period”). Employee agrees during the Employment Period to make himself available for
no fewer than five (5) hours per month during the term of this Agreement by telephone and in person
at the offices of Flowers or any other reasonable location for advice and consultation with
management of Flowers on financial and related affairs, including, but not limited to, assisting in
any activity which will facilitate the transition to the successor chief financial officer of
Flowers, assisting in the completion of any current project requiring background information
provided by Employee, advising the Chairman, CEO and President of Flowers on an as-needed basis on
financial and other related topics, and any other similarly related activities. Such services
shall be provided at such times during normal business hours as
may be mutually agreed upon by Flowers and Employee consistent with Employee’s other
commitments and schedule. Employee will not, during the Employment Period, engage in activities
which are detrimental to the business of Flowers, and will use his best efforts to promote good
relations between Flowers and the employees, shareholders, brokers, suppliers, contractors, and
customers of Flowers.
4. Compensation.
(a) In consideration of the services to be rendered by Employee during the Employment Period
under this Agreement, Employee shall be entitled to compensation pursuant to the attached
Schedule A.
(b) In addition, Flowers shall pay or reimburse Employee, in accordance with Flowers’ standard
policies and procedures, for reasonable travel and other business related expenses, if any,
incurred solely in the performance of his duties as an Employee.
(c) From the Effective Date through the date of the Employee’s termination on February 28,
2010, or earlier death, or resignation, Employee shall have the status of a full-time salaried
employee and Flowers shall provide to Employee medical, dental and life benefits (but not
disability benefits) on the same basis as provided to other full-time salaried employees at the
time in question. Employee shall be responsible for and pay the cost (which, to the extent
practicable, shall be the cost generally applicable to similarly situated employees of Flowers) of
all premiums due under such plans attributable to any covered dependents and shall promptly
reimburse Flowers for any premiums paid on behalf of such dependents.
5. Relationship Between Parties. During the Employment Period, Employee’s relation to
Flowers shall be that of an employee, but he shall be free to dispose of such portion of his time,
energy, and skill, to the extent not obligated to devote same to Flowers pursuant to Section 3
above, as he sees fit, and to such persons, firms or corporations as he deems advisable, subject to
the terms of this Agreement. During the Employment Period, Employee is not required to observe any
regular hours of work for Flowers or attend any regular conferences with any personnel of Flowers,
except as requested by Flowers in accordance with the terms of Section 3 of this Agreement.
6. Company Stock Transactions. Flowers and Employee recognize and agree that any and
all warrants, options or derivative securities involving Flowers common stock will remain
outstanding during the Employment Period, in accordance with the respective terms of agreements
covering such warrants, options or derivative securities. Furthermore, for purposes of the Equity
Award Agreements, Flowers hereby confirms that its Compensation Committee has determined that
Employee’s position under this Agreement is not a “demotion from the position of employment held”
by the Employee prior to the date of this Agreement, and Employee agrees with such determination.
7. Termination. The following provisions relate solely to termination of the
Employee’s employment during the Employment Period:
(a) Death. Subject to Section 8 below, this Agreement shall terminate automatically
upon the Employee’s death.
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(b) Cause. Flowers may terminate the Employee’s employment for “Cause.” For purposes
of this Agreement, “Cause” means (i) an act or acts of dishonesty, moral turpitude or willful
misconduct taken by the Employee and intended to result in substantial personal enrichment of the
Employee at the expense of Flowers or any of its affiliates or which have a material adverse impact
on the business or reputation of Flowers or any of its affiliates, or (ii) repeated violations by
the Employee of the Employee’s obligations under Section 3 of this Agreement which are demonstrably
willful and deliberate on the Employee’s part and which have a material adverse impact on the
business or reputation of Flowers or any of its affiliates.
(c) Notice of Termination. Any termination by the Employer for Cause shall be
communicated by Notice of Termination to the other party hereto given in accordance with Section 17
of this Agreement. For purposes of this Agreement, a “Notice of Termination” means a written
notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii)
sets forth in reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Employee’s employment under the provision so indicated, and (iii) if the
termination date is other than the date of receipt of such notice, specifies the termination date
(which date shall be not more than 15 days after the giving of such notice).
(d) Date of Termination. “Date of Termination” means the date of receipt of the
Notice of Termination by the Employee or any later date specified therein, as the case may be. If
the Employee’s employment is terminated by Flowers in breach of this Agreement, the Date of
Termination shall be the date on which Flowers notifies the Employee of such termination.
8. Obligations of Flowers Upon Termination. The following provisions apply only in the
event the Employee is terminated during the Employment Period:
(a) Death. If the Employee’s employment is terminated by reason of the Employee’s
death, this Agreement shall terminate without further obligation to the Employee’s legal
representatives under this Agreement other than those payment amounts accrued and payable hereunder
at the date of the Employee’s death.
(b) Cause. If the Employee’s employment shall be terminated for Cause, Flowers shall
pay the Employee any amounts then accrued and payable hereunder through the Date of Termination and
shall provide the Employee, through the Date of Termination, such welfare benefits, fringe
benefits, and other perquisites as were provided to the Employee immediately prior to delivery to
Employee of the Notice of Termination. Flowers shall have no further obligation to the Employee
under this Agreement.
(c) Other Than for Cause. If Flowers shall terminate the Employee’s employment with
Flowers other than for Cause,
(i) Flowers shall pay to the Employee in a lump sum in cash within 30 days after the
Date of Termination any amounts then accrued and payable hereunder through the Date of
Termination; and
(ii) Flowers shall, promptly upon submission by the Employee of supporting
documentation, pay or reimburse to the Employee any business-related costs and expenses paid
or incurred by Employee on or before the Date of Termination or within 30
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days after the Date of Termination which would have been payable under Section 4(b) if
the Employee’s employment had not terminated.
9. Standstill; Voting of Capital Stock.
(a) Employee covenants and agrees that for the duration of the Employment Period, Employee
shall not without the prior specific written consent of Flowers (i) make, or in any way participate
in any solicitation of proxies with respect to any securities of Flowers, whether equity or debt
securities or any direct or indirect options or other rights to acquire any such securities
(“Securities”) (including by the execution of action by written consent), become a participant in
any election contest with respect to Flowers, seek to influence any person with respect to any
Securities or demand a copy of Flowers’ list of its stockholders or other books and records; (ii)
participate in or encourage the formation of any partnership, syndicate, or other group which owns
or seeks or offers to acquire beneficial ownership of any Securities or which seeks to effect
control of Flowers or for the purpose of circumventing any provision of this Agreement; (iii)
otherwise act, alone or in concert with others (including by providing financing for another
person), to seek or to offer to control or influence, in any manner, the management, Board of
Directors or policies of Flowers, or any affiliate of Flowers, or (iv) propose or publicly announce
or otherwise disclose an intent to propose, or enter into or agree to enter into, singly or with
any other person or directly or indirectly, (1) any form of business combination, acquisition or
other transaction relating to Flowers or any affiliate thereof, (2) any form of restructuring,
recapitalization or similar transaction with respect to Flowers or any such affiliate, or (3) any
demand, request or proposal to amend, waive or terminate any provision of this Section.
(b) Employee covenants and agrees that for the duration of the Employment Period, at all
annual or special meetings of shareholders of Flowers or any written consent action to be taken by
the shareholders of Flowers, Employee shall take all actions necessary to vote all shares of
Flowers common stock currently owned of record or beneficially owned or hereafter directly or
indirectly acquired (of record or beneficially) by Employee in a manner consistent with the
recommendation of the Board of Directors of Flowers with respect to any proposal (including
nominees for election of directors).
(c) As used in this Agreement, (a) the terms or phrases “affiliate,” “beneficial owner,”
“election contest,” “equity security,” “group,” “participant,” “person,” “proxy,” and “security,”
(and the plurals thereof) will be ascribed meanings no less broad than the broadest definition or
meaning of such terms under the Securities Exchange Act of 1934, as amended, (the “Exchange Act”)
and the rules and regulations promulgated thereunder and (b) the term “immediate family” shall mean
the spouse, lineal descendant, father, mother, brother or sister of Employee.
10. Confidentiality.
(a) Each of the parties to this Agreement represents and agrees that it will keep the terms,
amount and facts of this Agreement completely confidential, and that it will not hereafter disclose
any information concerning this Agreement to anyone other than, in the case of the Employee, his
immediate family and professional representatives and, in the case of Flowers, its professional
representatives, who, in each case, will be informed of and bound by this confidentiality clause;
provided, however, that Employee shall be free to disclose to others any
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information relating to the terms, amount and facts of this Agreement to the extent Flowers
discloses any such information to the public, including, without limitation, any information
disclosed in Flowers’ filings with the Securities and Exchange Commission and Flowers shall be
permitted to disclose such information as it shall deem appropriate in its filings with the
Securities and Exchange Commission.
(b) Employee shall maintain in confidence and shall not, either during or at any time after
the Employment Period, communicate or disclose to, or use for the benefit of Employee or any other
person, firm, association or corporation any proprietary or confidential information, trade secret
or know-how belonging to Flowers (together, the “Proprietary Information”), whether or not such
information is in written or permanent form. Such Proprietary Information includes, but is not
limited to, techniques, processes, plans, or methods of Flowers in the manufacturing, distribution,
marketing and sale of bakery products, bread, or bread-type rolls, and technical and business
information relating to Flowers’ inventions or products, research and development, finances,
existing and potential customers and suppliers, marketing, and future business plans.
Notwithstanding the foregoing, the term Proprietary Information shall not include any information
that was in the public domain at the time it was disclosed or subsequently becomes in the public
domain, including information that is publicly known or generally utilized by others engaged in the
same business or activities as that in the course of which Flowers utilized, developed or otherwise
acquired such information, other than as a result of a disclosure by Employee in violation of this
Agreement. Employee hereby acknowledges and agrees that the prohibitions against disclosure of
Proprietary Information recited herein are in addition to, and not in lieu of, any rights or
remedies that Flowers may have available pursuant to the laws of any jurisdiction or common law or
judicial precedent to prevent the disclosure of trade secrets or proprietary information, and the
enforcement by Flowers of its rights and remedies pursuant to this Agreement shall not be construed
as a waiver of any other rights or available remedies that it may possess in law or equity absent
this Agreement.
(c) All Proprietary Information consisting of records, reports, notes, compilations or other
recorded matter, and copies or reproductions thereof, relating to Flowers’ operations, activities
or business, made or received by Employee during the Employment Period are and shall be Flowers’
exclusive property, and Employee shall keep the same at all times in his custody and subject to his
control, and will surrender the same to Flowers at the termination of the Employment Period, if not
before.
11. Non-competition Covenant.
(a) Covenant Not to Compete. The Employee covenants and agrees that he will not
compete with Flowers, directly or indirectly, by working as an employee, consultant or otherwise as
a Chief Financial Officer or other senior member of management in a business that is substantially
similar to the Business (as defined below) anywhere in the locations listed on Schedule B
(the “Proscribed Territory”), which the parties hereto agree represent the territories where
Flowers currently manufactures, distributes, markets and/or sells products or where Flowers has
active plans to manufacture, distribute, market or sell products for the term of the Employment
Period plus a period of one (1) year.
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(b) “Compete” Defined. For purposes of this Section, the term “compete” shall mean,
in each case with respect to “carrying on a business that is substantially similar to the
Business”: (i) entering into or attempting to enter into any business substantially similar to the
Business in the Proscribed Territory; (ii) calling on, soliciting, or actively taking away as a
customer — or attempting to call on, solicit, or actively take away as a customer — any
individual, partnership, corporation, or association that was a customer of Flowers immediately
prior to the date hereof for purpose of a business substantially similar to the Business; (iii)
hiring, soliciting, actively taking away — or attempting to hire, solicit or actively take away
— either on the Employee’s behalf or on behalf of any other person or entity, any person serving
immediately prior to the date hereof as an employee, or, to the extent not an employee, any person
providing substantial services as a director or officer of Flowers, in connection with the
Business; or (iv) entering into or attempting to enter into any business substantially similar to
or competing in any way with the Business, either alone or with any individual, partnership,
corporation, limited liability company, or other legal entity.
(c) “Directly or Indirectly” Defined. For purposes this Section, the words “directly
or indirectly” as they modify the word “compete” shall mean: (i) acting as an agent,
representative, consultant, officer, director, independent contractor, or employee of any entity or
enterprise that is competing (as defined above) with the Business; (ii) participating in any entity
or enterprise that is competing with the Business as an owner, partner, limited partner, member,
manager, joint venturer, creditor, or shareholder (except as a shareholder holding less than a
five-percent (5%) interest in a corporation whose shares are actively traded on a regional or
national securities exchange or in the over-the-counter market); and (iii) communicating to any
entity or enterprise that is competing with the Business the names or addresses or any other
information concerning any past, present, or currently identified prospective client or customer of
Flowers.
(d) “Business” Defined. For purposes of this Agreement, the term “Business” shall
mean the operations of Flowers, which the parties hereto agree include the manufacturing,
distribution, marketing and sale of bakery products, bread, or bread-type rolls.
12. Future Cooperation. During the term of this Agreement and with the exception of
litigation wherein Employee is an individually-named and properly served defendant and wishes to
take such actions as he deems appropriate to defend himself, Employee shall, upon request by and at
the expense of Flowers, assist and cooperate with Flowers in any complaints brought or threatened
by any party (other than Employee) against Flowers or any affiliate, successor or subsidiary
thereof in any lawsuits, disputes, differences, grievances, claims, charges, or complaints brought
or threatened by any party or brought by Flowers or any affiliate, successor or subsidiary thereof,
against any party
13. Successors Bound; Assignability. This Agreement shall be binding upon Employee,
Flowers and their respective successors in interest, including without limitation, any corporation
into which Flowers may be merged or by which it or all or any substantial portion of its assets or
business may be acquired. This Agreement is non-assignable except that the rights, duties and
obligations of Flowers under this Agreement may be assigned to any affiliate of it and to any
acquiror of the business conducted by Flowers, in the event Flowers is merged, liquidated, acquired
or sells substantially all of the assets used in such business.
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14. Severability. In the event that any one or more of the provisions of this
Agreement or any word, phrase, clause, sentence, or other portion thereof shall be deemed to be
illegal or unenforceable for any reasons, such provision or portion thereof shall be modified or
deleted in such a manner as to make this Agreement as modified legal and enforceable to the fullest
extent permitted under applicable laws.
15. Entire Agreement. This Agreement constitutes the entire Agreement between the
parties hereto with regard to the subject matter hereof and supersedes all other agreements
relating to the subject matter hereof. There are no agreements, understandings, specific
restrictions, warranties or representations relating to said subject matter between the parties
other than those set forth herein or herein provided.
16. Counterparts. This Agreement may be executed in two or more counterparts, each of
which will take effect as an original, and all of which shall evidence one and the same Agreement.
17. Notices. All notices, requests, demands and other communications hereunder shall
be in writing and shall be delivered by hand or mailed by registered or certified mail, return
receipt requested, first class postage prepaid, or sent by Federal Express or similarly recognized
overnight delivery service with receipt acknowledged, addressed as follows:
If to Employee:
Xxxxx X. Xxxxxxxx
000 Xxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
000 Xxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
If to Flowers:
Flowers Foods, Inc.
0000 Xxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxx 00000
Attn: General Counsel
0000 Xxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxx 00000
Attn: General Counsel
with a copy to:
Xxxxxxx Xxxxxx, Esq.
Xxxxx Day
Suite 800
1420 Peachtree Street, N.E.
Xxxxxxx, Xxxxxxx 00000-0000
Xxxxx Day
Suite 800
1420 Peachtree Street, N.E.
Xxxxxxx, Xxxxxxx 00000-0000
If delivered personally, the date on which a notice, request, instruction or document is
delivered shall be the date on which such delivery is made and, if delivered by mail or by
overnight delivery service, the date on which such notice, request, instruction or document is
received shall be the date of delivery. In the event any such notice, request, instruction or
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document is mailed or shipped by overnight delivery service to a party in accordance with this
Section and is returned to the sender as nondeliverable, then such notice, request, instruction or
document shall be deemed to have been delivered or received on the fifth day following the deposit
of such notice, request, instruction, or document in the United States mails or the delivery to the
overnight delivery service. Any party may change its address specified for notices herein by
designating a new address by notice in accordance with this Section.
18. Remedies. Each party acknowledges that a breach by any party of the covenants
contained in this Agreement cannot reasonably or adequately be compensated in damages in an action
at law; and that a breach by any party of any of his or its covenants contained in this Agreement
will cause the other party and their respective businesses irreparable injury and damage. By
reason thereof, each party shall be entitled, in addition to any other remedies he, she or it may
have under this Agreement or otherwise, to preliminary and permanent injunctive and other equitable
relief, without the necessity of providing any proof that monetary damages would be inadequate, to
prevent or curtail any breach of this Agreement by the other party; provided, however, that no
specification in this Agreement of a specific legal or equitable remedy shall be construed as a
waiver or prohibition against the pursuing of other legal or equitable remedies in the event of
such a breach.
19. Amendment and Modification. This Agreement may only be amended, modified or
terminated prior to the end of its term by the mutual agreement of the parties.
20. Governing Law. The terms of this Agreement shall be governed by and construed in
accordance with the laws of the State of Georgia.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date and year first
above written.
| “EMPLOYEE” |
||||
| /s/ Xxxxx X. Xxxxxxxx | ||||
| XXXXX X. XXXXXXXX | ||||
| FLOWERS FOODS, INC. |
||||
| By: | /s/ Xxxxxxx X. Xxxxx | |||
| Name: | Xxxxxxx X. Xxxxx | |||
| Title: | Senior Vice President, Secretary & General Counsel | |||
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SCHEDULE A
COMPENSATION SCHEDULE
COMPENSATION SCHEDULE
Compensation for the period from the Effective Date through February 28, 2010, is to be paid
consistent with Flowers’ then applicable payroll practices, including, without limitation,
applicable withholding. Compensation for the remainder of FY 2007 shall be based upon a per annum
salary of $383,089, and shall include the bonus otherwise payable to the Employee pursuant to the
bonus opportunity for FY 2007 previously communicated to Employee.
For the period commencing FY 2008 and ending on February 28, 2010, compensation of $10,000 per
annum shall be paid on the following dates:
December 30, 2007 — $10,000.00
January 3, 2009 — $10,000.00
February 28, 2010 — $1,667.00
SCHEDULE B
PROSCRIBED TERRITORY
PROSCRIBED TERRITORY
The forty-eight states of the continental United States and the District of Columbia
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