Exhibit 10.2
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT ("Agreement") is entered into as of July 12,
2004 (the "Effective Date") by and between TRACTOR SUPPLY COMPANY, a Delaware
corporation (the "Company"), and Xxxxx X. Xxxxxx (the "Executive").
W I T N E S S E T H:
WHEREAS, the Executive is employed as the President and Chief Operating
Officer of the Company and the Company desires that the Executive continue to
serve as President and Chief Operating Officer through September 30, 2004 and to
assume the office of President and Chief Executive Officer on October 1, 2004;
and
WHEREAS, the Company and the Executive wish to memorialize their
understanding of the terms of the Executive's employment with the Company, the
financial obligations of the Company to the Executive and to specify certain
rights, responsibilities and duties of the Executive.
NOW, THEREFORE, based upon the premises set forth herein and for other
good and valuable consideration, the receipt and sufficient of which is hereby
acknowledged, the parties agree as follows:
ARTICLE I. RESPONSIBILITIES
Until September 30, 2004, the Executive shall serve as President and
Chief Operating Officer of the Company, and commencing October 1, 2004, the
Executive shall serve as President and Chief Executive Officer of the Company,
or such other executive position as the Executive shall approve, performing
duties commensurate with the position of President and Chief Executive Officer
and such additional duties as the Board of Directors of the Company (the
"Board") shall reasonably determine from time to time during the term of this
Agreement. The Executive shall report directly to the Board. The Executive
accepts employment upon the terms set forth in this Agreement and will perform
diligently to the best of his abilities those duties contemplated by this
Agreement in a manner that promotes the interests and goodwill of the Company.
The Executive will faithfully devote his commercially reasonable efforts and all
his working time to and for the benefit of the Company. The Executive may devote
reasonable time and attention to civic, charitable, business or social
organizations or speaking engagements so long as such activities do not
interfere with the performance of the Executive's responsibilities under this
Agreement and provided the Executive shall not serve as a director for more than
one publicly traded company in addition to serving as a director of the Company.
The Executive agrees to serve, without any additional compensation, as a
director on the Board and the board of directors of any subsidiary of the
Company, and/or in one or more officer positions with any subsidiary of the
Company. If the Executive's employment is terminated for any reason, whether
such termination is voluntary or involuntary, the Executive shall resign as a
director of the Company (and any of its subsidiaries), such resignation to be
effective no later than the date of termination of the Executive's employment
with the Company. The permanent place of
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employment of the Executive shall be the corporate headquarters of the Company
which shall be located within thirty (30) miles of the metropolitan Nashville,
Tennessee area. The Executive shall not be required to relocate his place of
employment outside of such area at any time during the Term without his prior
consent, which consent may be withheld by the Executive for any reason he deems
appropriate. The Executive may be required to conduct reasonable travel in the
course of the performance of his duties on behalf of the Company.
ARTICLE II. TERM
Subject to termination pursuant to Article IV hereof, the term of the
Executive's employment by the Company pursuant to this Agreement (as the same
may be extended, the "Term") shall commence on the date hereof (the "Effective
Date"), and terminate on December 31, 2007 (the "Initial Term") and shall
automatically renew for successive three (3) year periods (each, a "Renewal
Term") upon all terms, conditions and obligations set forth herein unless either
party shall provide written notice of non-renewal to the other at least one (1)
year prior to the expiration of the Initial Term or any Renewal Term, as
applicable. Notwithstanding any other provision of this Agreement to the
contrary, this Agreement will terminate on the date of the Executive's
retirement from the Company, which for purposes of this Agreement, shall be
deemed to be December 31st of the year in which the Executive attains the age of
65.
ARTICLE III. COMPENSATION
SECTION 3.1 GENERAL TERMS.
(A) BASE SALARY. For the period beginning on the Effective Date through
September 30, 2004, the Company shall continue to pay the Executive base salary
at the rate in effect on the Effective Date. Commencing October 1, 2004, the
Company shall pay the Executive base salary at the rate of $682,500.00 per annum
("Minimum Base Salary"), payable in accordance with the Company's ordinary
payroll policies. Commencing in the Company's fiscal year 2005, Executive's base
salary shall be reviewed annually by the Compensation Committee of the Board and
may be increased in the sole discretion of the Board (such base salary, as the
same may be increased, is hereinafter referred to as the "Base Salary");
provided, however that the Base Salary shall at no time during the Term be below
the Minimum Base Salary. Any increases in Base Salary that are memorialized in
the minutes of the Board shall be incorporated herein by reference without
further action by the Executive or the Company.
(B) BONUS. The Executive shall be eligible to participate in such bonus
plans during the Term as the Compensation Committee may determine appropriate
for executive officers of the Company.
SECTION 3.2 AWARDS UNDER STOCK OPTION PLAN.
Reference is made to the Tractor Supply Company 2000 Stock Incentive
Plan (the "Plan"). On October 1, 2004, the Company shall grant the Executive a
non-qualified stock option under the Plan to purchase 37,500 shares of the
Company's common stock at an exercise price equal to the closing sale price of
the Company's common stock on the Nasdaq National
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Market on September 30, 2004. Such stock option shall have a term of ten (10)
years from the date of grant and shall vest in equal annual increments on each
of October 1, 2005, October 1, 2006 and October 1, 2007. In the event the
Executive's employment under this Agreement is terminated, such option may be
exercised, to the extent then exercisable and not previously exercised, in
accordance with the provisions of the Plan.
SECTION 3.3 REIMBURSEMENT.
It is acknowledged by the parties that the Executive, in connection
with the services to be performed by him pursuant to the terms of this
Agreement, will be required to make payments for travel, entertainment of
business associates and similar business related expenses. The Company will
reimburse the Executive for all reasonable, documented expenses of types
authorized by the Company and incurred by the Executive in the performance of
his duties hereunder. The Executive will comply with such budget limitations and
approval and reporting requirements with respect to expenses as the Company may
establish from time to time.
SECTION 3.4 EMPLOYEE BENEFITS.
(A) GENERAL. During the Term, the Company shall provide the Executive
with employee and fringe benefits under any and all employee benefit plans and
programs which are from time to time generally made available to the executive
officers of the Company. Nothing in this Agreement shall require the Company to
maintain such plans or programs nor prohibit the Company from terminating,
amending or modifying such plans and programs, as the Company, in its sole
direction, may deem advisable. In all events, including but not limited to, the
funding, operation, management, participation, vesting, termination, amendment
or modification of such plans and programs, the rights and benefits of the
Executive shall be governed solely by the terms of the plans and programs, as
provided in such plans, programs or any contract or agreement related thereto.
Nothing in this Agreement shall be deemed to amend or modify any such plan or
program.
(B) VACATION LEAVE. During the Term, the Executive shall be entitled to
paid vacation in accordance with the Company's standard vacation policies for
its executive officers as may be in effect from time to time.
ARTICLE IV. TERMINATION
The Executive's employment by the Company pursuant to this Agreement
shall not be terminated prior to the end of the Term hereof except as set forth
in this Article IV.
SECTION 4.1 BY MUTUAL CONSENT.
The Executive's employment pursuant to this Agreement may be terminated
at any time by the mutual written agreement of the Company and the Executive. In
the event that the Executive's employment is terminated pursuant to this SECTION
4.1, the Executive shall receive Base Salary and benefits to be paid or provided
to the Executive under this Agreement through the Date of Termination (as
defined in SECTION 4.9 hereof) and any other unpaid benefits to
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which the Executive is otherwise entitled under any plan, policy or program of
the Company (including any bonus plan) applicable to the Executive as of the
Date of Termination.
SECTION 4.2 DEATH.
The Executive's employment pursuant to this Agreement shall be
terminated upon the death of the Executive, in which event the Executive's
spouse or heirs shall receive, when the same would have been paid to the
Executive, all Base Salary and benefits to be paid or provided to the Executive
under this Agreement through the Date of Termination, and any other unpaid
benefits (including death benefits) to which they are entitled under any plan,
policy or program of the Company (including any bonus plan) applicable to the
Executive as of the Date of Termination.
SECTION 4.3 DISABILITY.
The Executive's employment pursuant to this Agreement may be terminated
by written notice to the Executive by the Company or to the Company by the
Executive ("Notice of Termination") in the event that the Executive is unable,
as reasonably determined by the Board, to perform his regular duties and
responsibilities due to physical or mental illness which has lasted (or can
reasonably be expected to last) for a period of six (6) consecutive months. In
the event the Executive's employment is terminated pursuant to this SECTION 4.3,
the Executive shall be entitled to receive, when the same would have been paid
to the Executive, all Base Salary and benefits to be paid or provided to the
Executive under this Agreement through the Date of Termination, and any other
unpaid benefits (including disability benefits) to which he is otherwise
entitled under any plan, policy or program of the Company (including any bonus
plan) applicable to the Executive as of the Date of Termination.
SECTION 4.4 BY THE COMPANY FOR CAUSE.
The Executive's employment pursuant to this Agreement may be terminated
by the Company at any time by delivery of a Notice of Termination to the
Executive upon the occurrence of any of the following events (each of which
shall constitute "Cause" for termination): (i) failure or refusal to carry out
the lawful directions of the Company, which are reasonably consistent with the
responsibilities of the Executive's position; (ii) a material act of dishonesty
or disloyalty related to the business of the Company; (iii) conviction of a
felony, a lesser crime against the Company, or any crime involving dishonest
conduct; (iv) habitual or repeated misuse or habitual or repeated performance of
the Executive's duties under the influence of alcohol or controlled substances;
or (v) any incident materially compromising the Executive's reputation or
ability to represent the Company with the public or any act or omission by the
Executive that substantially impairs the Company's business, good will or
reputation. In the event the Executive's employment is terminated pursuant to
this SECTION 4.4, the Executive shall be entitled to receive all Base Salary and
benefits to be paid or provided to the Executive under this Agreement through
the Date of Termination, and any other unpaid benefits to which he is otherwise
entitled under any plan, policy or program of the Company (not including any
bonus plan) applicable to the Executive as of the Date of Termination.
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SECTION 4.5 BY THE COMPANY WITHOUT CAUSE.
The Executive's employment pursuant to this Agreement may be terminated
by the Company upon thirty (30) days' prior written notice without Cause by
delivery of a Notice of Termination to the Executive. In the event that the
Executive's employment is terminated pursuant to this SECTION 4.5 during the
Term, the Executive shall be entitled to receive: (i) Base Salary to be provided
to the Executive under this Agreement through the second anniversary of the Date
of Termination payable in accordance with the Company's ordinary payroll
policies (whether or not the Term shall have expired during such period); (ii)
bonus equal to the aggregate bonus paid to the Executive for the two fiscal
years immediately preceding the Date of Termination(the "Bonus Amount"), such
amount to be paid ratably over the period in which Base Salary is paid under (i)
above; (iii) health insurance benefits substantially commensurate with the
Company's standard health insurance benefits through the second anniversary of
the Date of Termination; (iv) any other unpaid benefits to which the Executive
is otherwise entitled under any plan, policy or program of the Company
applicable to the Executive as of the Date of Termination; and (v) outplacement
services suitable to the Executive's position not to exceed $50,000 in amount or
for a period exceeding the earlier of one year from the Date of Termination or
the first acceptance by the Executive of an offer of employment. In addition,
the Executive shall be fully vested in all then outstanding options to acquire
stock of the Company, and all then outstanding restricted shares of stock of the
Company held by the Executive and such options shall remain exercisable until
the earlier of (x) the first anniversary of the Date of Termination and (y) the
otherwise applicable normal expiration date of such option (these rights
together with the payments and benefits enumerated in subsection (i) through (v)
above shall be referred to as the "Severance Payments"). To the extent that the
full vesting of any stock option or share of restricted stock, or the full
exercisability of any stock option, provided for herein should violate any law,
rule or regulation of any governmental authority or self-regulatory organization
applicable to the Company, or to the extent otherwise reasonably determined by
the Company, the Company may, in lieu of providing any vesting or exercisability
rights herein cancel any or all of the Executive's outstanding unvested options
in exchange for a lump sum payment, in cash, equal to the excess of the fair
market value of the shares of stock underlying the unvested portion of such
options on the Date of Termination over the aggregate exercise price provided
for in such stock options, and repurchase any shares of unvested restricted
stock at their fair market value as determined by the closing sale price of the
Company's common stock on the Nasdaq National Market on the Date of Termination.
As a condition to receiving the Severance Payments contemplated by this SECTION
4.5, the Executive agrees to sign, at the time of termination of his employment,
a release in favor of the Company, its directors and officers of any and all
employment-law related claims.
SECTION 4.6 BY THE EXECUTIVE FOR GOOD REASON.
The Executive's employment pursuant to this Agreement may be terminated
by the Executive by written notice of his resignation ("Notice of Resignation")
delivered within one (1) month after the occurrence of (i) the assignment to the
Executive of any duties inconsistent with the Executive's status as a senior
executive officer of the Company or a substantial adverse alteration in the
nature or status of the Executive's responsibilities; or (ii) a material breach
of this Agreement by the Company that remains uncured by the Company for a
period of sixty (60) days (each of which shall constitute "Good Reason" for
resignation); provided, however, that
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"Good Reason" shall exclude a decision by the Company not to extend this
Agreement beyond the Initial Term or any Renewal Term. In the event that the
Executive resigns for Good Reason pursuant to this SECTION 4.6 during the Term,
the Executive shall be entitled to receive the Severance Payments. As a
condition to receiving the Severance Payments contemplated by this SECTION 4.6,
the Executive agrees to sign, at the time of termination of his employment, a
release in favor of the Company of any and all employment-law related claims.
SECTION 4.7 BY THE EXECUTIVE WITHOUT GOOD REASON.
The Executive's employment pursuant to this Agreement may be terminated
by the Executive at any time by delivery of a Notice of Resignation to the
Company. In the event that the Executive's employment is terminated pursuant to
this SECTION 4.7, the Executive shall receive Base Salary and benefits to be
paid or provided to the Executive under this Agreement through the Date of
Termination and any other unpaid benefits to which the Executive is otherwise
entitled under any plan, policy or program of the Company (not including any
bonus plan) applicable to the Executive as of the Date of Termination.
SECTION 4.8 BY THE COMPANY OR THE EXECUTIVE FOLLOWING A CHANGE IN
CONTROL.
The parties acknowledge that they are subject to a Change in Control
Agreement dated as of August 1, 2002 (the "Change in Control Agreement") and
that such Change in Control Agreement shall remain in full force and effect in
accordance with its terms notwithstanding the execution and delivery of this
Agreement. The Company and the Executive further acknowledge and agree that in
the event of the termination of the Executive's employment for any reason
following a Change in Control (as defined in the Change in Control Agreement) of
the Company during the term of the Change in Control Agreement, the provisions
of the Change in Control Agreement shall control and provide the exclusive means
for determining the severance benefits payable to the Executive and this Article
IV shall be of no further force or effect.
SECTION 4.9 DATE OF TERMINATION.
The Executive's Date of Termination shall be (i) if the Executive's
employment is terminated pursuant to SECTION 4.1, the date mutually agreed to by
the Company and the Executive, (ii) if the Executive's employment is terminated
pursuant to SECTION 4.2, the last day of the calendar month in which the
Executive's death occurs, (iii) if the Executive's employment is terminated
pursuant to SECTION 4.3, the last day of the calendar month in which a Notice of
Termination is given, (iv) if the Executive's employment is terminated pursuant
to SECTION 4.4, the date on which a Notice of Termination is given; (v) if the
Executive's employment is terminated pursuant to SECTION 4.5, thirty (30) days
after the date of Notice of Termination is given, (vi) if the Executive's
employment is terminated pursuant to SECTION 4.6, thirty (30) days after the
date of Notice of Resignation is given and (vii) if the Executive's employment
is terminated pursuant to SECTION 4.7, thirty (30) days after the date of Notice
of Resignation is given.
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SECTION 4.10 OFFSET; TERMINATION OF OBLIGATION.
(A) Notwithstanding anything contained in this Article IV to the
contrary, in the event the Company terminates the Executive's employment
pursuant to SECTION 4.5 or the Executive terminates his employment pursuant to
SECTION 4.6 and the Executive accepts other employment or provides consulting,
advisory or other services during the period in which the Company is required to
make payments pursuant to SECTION 4.5 or SECTION 4.6, the Executive shall notify
the Company in writing that he has accepted such employment or agreed to provide
such consulting, advisory or other services and the terms of his employment or
engagement. The Company's obligation to make payments pursuant to SECTION 4.5 or
SECTION 4.6 shall be reduced dollar-for-dollar by the amount of compensation
earned by the Executive from such other employment or for providing such
services during the period in which the Company is required to make payments
pursuant to SECTION 4.5 or SECTION 4.6.
(B) Notwithstanding anything contained in this Article IV to the
contrary, the Company's obligation to make payments pursuant to SECTION 4.5 or
SECTION 4.6 shall immediately terminate in the event the Executive violates in
any material respect the provisions of Article V or Article VI of this
Agreement.
ARTICLE V. COVENANTS OF THE EXECUTIVE
SECTION 5.1 DEFINITIONS.
(A) "COMPANY PROPERTY" means all records, data, files, manuals,
memoranda, documents, supplies, computer materials, equipment, inventory and
other materials that have been created, used or obtained by the Company,
including but not limited to pagers, databases, security cards and badges,
insurance cards, keys, computer manuals, company or employee manuals, credit
cards, computers, laptops, printers, fax machines, cellular and landline phones,
and copiers, as well as Confidential and Proprietary Information and Technology
and all business revenues and fees produced or transacted through the efforts of
the Company.
(B) "CONFIDENTIAL AND PROPRIETARY INFORMATION" means all information,
not generally known to the public, that relates to the business, technology,
manner of operation, subscribers, customers, finances, employees, plans,
proposals or practices of the Company or of any third parties doing business
with the Company, and includes, without limitation, the identities of and other
information regarding the Company's subscribers, customers and prospects,
supplier lists, employee information, business plans and proposals, software
programs, marketing plans and proposals, technical plans and proposals, research
and development, budgets and projections, nonpublic financial information, all
other information the Company designates as "confidential," and all other
information and matters not generally known to the public. Excluded from the
definition of Confidential and Proprietary Information is information (A) that
is or becomes part of the public domain, other than through the breach of this
Agreement by the Executive or (B) regarding the Company's business or industry
properly acquired by the Executive in the course of his career as an executive
in the Company's industry and independent of his employment by the Company. For
this purpose, information known or available generally within the trade or
industry of the Company or any subsidiary of the Company shall be deemed to be
known to the public.
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(C) "DISPARAGE THE COMPANY" means, except in the good faith performance
of the Executive's duties, conduct by which he criticizes, denigrates or
otherwise speaks adversely, or discloses negative information about, the
operations, management or performance of the Company, an affiliate of the
Company, or about any director, officer, employee or agent of any of the above.
(D) "SOLICITATION" means (A) the direct or indirect solicitation of,
inducement of, or attempt to induce, any employees, agents, or consultants of
the Company or any of its subsidiaries to leave the employ of, or stop providing
services to, the Company or such subsidiary; (B) the direct or indirect offering
or aiding another to offer employment to, or interfere or attempt to interfere
with, the Company's or such subsidiary's relationship with any employees or
consultants of the Company or such subsidiary; or (C) the direct or indirect
solicitation, or assistance to any entity or person in solicitation of, any
subscribers or customers of the Company to discontinue doing business with the
Company.
(E) "TECHNOLOGY" means all inventions, discoveries, designs,
developments, improvements, copyrightable materials, trade secrets, new
concepts, new ideas and expressions of ideas, (including computer programs and
software), which relate to the Company's present or prospective businesses or
have been created using Company property, Confidential or Proprietary
Information of the Company, the advice or help of other Company employees,
independent contractors or other third parties, or other resources of the
Company. The Executive understands and agrees that this definition of
"Technology" applies even if a patent or copyright cannot be issued or claimed,
and even if the Company does not intend to exploit, work or develop the
Technology.
SECTION 5.2 NONDISCLOSURE OF CONFIDENTIAL AND PROPRIETARY INFORMATION.
The Executive understands and agrees that Confidential and Proprietary
Information will be considered the trade secrets of the Company and will be
entitled to all protections given by law to trade secrets and that the
provisions of this Agreement apply to every form in which Confidential and
Proprietary Information exists, including, without limitation, written or
printed information, films, tapes, computer disks or data, or any other form of
memory device, media or method by which information is stored or maintained. The
Executive acknowledges that in the course of employment with the Company, he has
received and may receive Confidential and Proprietary Information of the
Company. The Executive further acknowledges that Confidential and Proprietary
Information is a valuable, unique and special asset belonging to the Company.
For these reasons, and except as otherwise directed by the Company, the
Executive agrees, during his employment, and at all times after the termination
of his employment with the Company, that he will not disclose or disseminate to
anyone outside the Company, nor use for any purpose other than his work for the
Company, nor assist anyone else in any such disclosure or use of, any
Confidential or Proprietary Information of the Company.
The Executive further agrees, during his employment and for a period of
two (2) years after his employment terminates, that he will not engage in any
activities or accept any employment or work assignment that would compromise the
confidentiality, or result in the
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direct or indirect disclosure or use, of any Confidential and Proprietary
Information of the Company.
SECTION 5.3 COMPANY TECHNOLOGY/ASSIGNMENT OF INVENTIONS.
The Executive recognizes and agrees that all present and future
Technology, whether conceived, developed or reduced to practice during his
employment by others or by himself, solely or jointly, is and will become the
property of the Company. To the extent permitted under the U.S. Copyright Act
(17 U.S.C. ss. 101 et seq.) and any successor statute thereto, the Executive
agrees that any copyrightable materials that he has created or creates during
his employment that directly relate to the Company's then current or anticipated
business, operations or plans will constitute "works made for hire," and the
ownership of such materials will vest in the Company at the time they are
created. The Executive agrees to assign and does hereby assign to the Company
(or any person or entity designated by the Company) all his rights, title and
interests in and to all Technology and all related patents, patent applications,
copyrights and copyright applications. The Executive further agrees, both while
employed by the Company and at the time his employment with the Company is
terminated, to disclose promptly to the Company all Technology that has been
made or conceived by him while employed by the Company. Both during and at all
times after his employment with the Company is terminated, the Executive will,
upon request, assist the Company to protect the Company's ownership of
Technology and to obtain and protect any and all patents and copyrights covering
any Technology. To this end, the Executive agrees to sign all papers, including,
without limitation, copyright applications, patent applications, declarations,
oaths, formal assignments, assignment of priority rights, and powers of attorney
that the Company may deem necessary or desirable in order to protect its rights
and interests in any Technology.
The Executive understands that his obligation to assign will not apply
to any Technology that he develops or developed entirely on his own time without
using the Company's equipment, supplies, facilities, or Confidential and
Proprietary Information, unless the Technology (a) relates at the time of
conception or reduction to practice directly to the Company's business or actual
or demonstrably anticipated research or development of the Company, or (b)
results from any work performed by him for the Company.
SECTION 5.4 COMPANY PROPERTY.
The Executive agrees to preserve, use and hold Company Property, which
is and remains the property of the Company, only for the benefit of the Company
to carry out the Company's business. The Executive agrees that, on or before the
day on which his employment with the Company is terminated, he will deliver or
return to the Company all the Company Property, including all copies of the
Company Property, in his possession or control. The Executive further agrees not
to use any computer access code or password belonging to the Company and not to
access any computer or database in the possession or control of the Company
after his employment with the Company is terminated.
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SECTION 5.5 NONDISPARAGEMENT.
During the Term and thereafter, the Executive will not Disparage the
Company. This SECTION 5.5 shall not be deemed breached unless the violation is
willful, with the intent to damage, in a public forum or intended to become
public, and is of a material nature.
ARTICLE VI. NONCOMPETITION AND NONSOLICITATION
SECTION 6.1 NONCOMPETITION.
In consideration for the benefits the Executive is receiving hereunder,
the Executive hereby acknowledges, and for other good and valuable
consideration, agrees that during the Executive's employment and for two (2)
years following the termination of his employment, and without the prior written
consent of the Company, the Executive will not, in any manner, serve in a senior
management position for a business with annual sales in excess of $500,000 per
annum that operates a group of retail farm and ranch stores in the United States
focused on supplying the lifestyle needs of recreation farmers and ranchers (a
"Company Competitor") or be associated with or a consultant to, any entity that
(i) is a Company Competitor, or (ii) will inevitably result in the disclosure or
use of Confidential and Proprietary Information.
SECTION 6.2 NONSOLICITATION.
During the Executive's employment and for two (2) years following the
termination of his employment, he will not engage in any Solicitation, provided
that Solicitation will not be considered to have occurred by the general
advertising for hiring of employees by entities with which the Executive is
associated, as long as he does not directly or indirectly induce employees to
leave the Company.
SECTION 6.3 REMEDIES.
The Executive acknowledges and agrees that the violation of the
covenants in this Article VI would cause irreparable injury to the Company and
that the remedy at law for any violation or threatened violation would be
inadequate and that the Company shall be entitled to seek temporary and
permanent injunctive relief or other equitable relief without the necessity of
proving actual damages. The Executive represents that enforcement of a remedy by
way of injunction will not prevent him from earning a livelihood. The Executive
further represents and admits that time periods contained in this Article VI are
reasonably necessary to protect the interest of the Company and would not
unfairly or unreasonably restrict the Executive. Such relief shall be in
addition to any other remedies available to the Company, including specifically
without intending any limitation, the recovery of damages.
SECTION 6.4 REFORMATION AND SEVERANCE.
If a judicial determination is made that any of the provisions of the
restrictions contained in this Article VI constitute an unreasonable or
otherwise unenforceable restriction against the Executive, it shall be rendered
void only to the extent that such judicial determination finds such
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provisions to be unreasonable or otherwise unenforceable. In this regard, the
parties hereby agree that any judicial authority construing this Agreement shall
be empowered to sever any portion of the prohibited business activity from the
coverage of this restriction and to apply the restriction to the remaining
portion of the business activities not so severed by such judicial authority.
ARTICLE VII. ARBITRATION
SECTION 7.1 SCOPE. The Company and the Executive acknowledge and agree
that any claim or controversy arising out of or relating to ARTICLE IV of this
Agreement shall be settled by nonbinding arbitration in Nashville, Tennessee, in
accordance with the National Rules of the American Arbitration Association for
the Resolution of Employment Disputes in effect on the date of the event giving
rise to the claim or controversy. The Company and the Executive further
acknowledge and agree that either party must request arbitration of any claim or
controversy within ninety (90) days of the date of the event giving rise to the
claim or controversy by giving written notice of the party's request for
arbitration. Failure to give notice of any claim or controversy within ninety
(90) days of the event giving rise to the claim or controversy shall constitute
waiver of the claim or controversy.
SECTION 7.2 PROCEDURES. All claims or controversies subject to
arbitration shall be submitted to arbitration within six months from the date
that a written notice of request for arbitration is effective. All claims or
controversies shall be resolved by a panel of three arbitrators who are licensed
to practice law in the State of Tennessee and who are experienced in the
arbitration of employment disputes. These arbitrators shall be selected in
accordance with the National Rules of the American Arbitration Association for
the Resolution of Employment Disputes in effect at the time the claim or
controversy arises. The arbitrators shall issue a written decision with respect
to all claims or controversies within 30 days from the date the claims or
controversies are submitted to arbitration. The parties shall be entitled to be
represented by legal counsel at any arbitration proceedings. The Executive and
the Company acknowledge and agree that the prevailing party in such arbitration
will bear the cost of the arbitration proceeding, and each party shall be
responsible for paying its own attorneys' fees, if any, unless the arbitrators
determine otherwise.
SECTION 7.3 ENFORCEMENT. The Company and the Executive acknowledge and
agree that the arbitration provisions in this Agreement may be specifically
enforced by either party, and that submission to arbitration proceedings may be
compelled by any court of competent jurisdiction. The Company and the Executive
further acknowledge and agree that the decision of the arbitrators may be
specifically enforced by either party in any court of competent jurisdiction.
SECTION 7.4 LIMITATIONS. Notwithstanding the arbitration provisions set
forth herein, Employee and the Company acknowledge and agree that nothing in
this Agreement shall be construed to require the arbitration of any claim or
controversy arising under ARTICLES V or VI of this Agreement. These provisions
shall be enforceable by any court of competent jurisdiction and shall not be
subject to arbitration except by mutual written consent of the parties signed
after the dispute arises, any such consent, and the terms and conditions
thereof, then becoming
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binding on the parties. The Executive and the Company further acknowledge and
agree that nothing in this Agreement shall be construed to require arbitration
of any claim for workers' compensation or unemployment compensation.
ARTICLE VIII. GENERAL TERMS
SECTION 8.1 NOTICES.
All notices and other communications hereunder will be in writing or by
written telecommunication, and will be deemed to have been duly given if
delivered personally or if sent by overnight courier or by written
telecommunication, to the relevant address set forth below, or to such other
address as the recipient of such notice or communication will have specified to
the other party hereto in accordance with this SECTION 8.1:
If to the Company, to:
Tractor Supply Company
000 Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: General Counsel
If to the Executive, to:
Xxxxx X. Xxxxxx
0000 Xxxxxxxxxx Xxx
Xxxxxxxxx, Xxxxxxxxx 00000
SECTION 8.2 WITHHOLDING.
All payments required to be made by the Company under this Agreement to
the Executive will be subject to the withholding of such amounts, if any,
relating to federal, state and local taxes as may be required by law.
SECTION 8.3 ENTIRE AGREEMENT; MODIFICATION.
This Agreement and the Change in Control Agreement constitute the
complete and entire agreement between the parties with respect to the subject
matter hereof and supersede all prior agreements between the parties. The
parties have executed this Agreement based upon the express terms and provisions
set forth herein and have not relied on any communications or representations,
oral or written, which are not set forth in this Agreement.
SECTION 8.4 AMENDMENT.
The covenants or provisions of this Agreement may not be modified by an
subsequent agreement unless the modifying agreement: (i) is in writing; (ii)
contains an express provision referencing this Agreement; (iii) is signed and
executed on behalf of the Company by an officer
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of the Company other than the Executive; (iv) is approved by resolution of the
Board; and (v) is signed by the Executive.
SECTION 8.5 LEGAL CONSULTATION.
Both parties have been accorded a reasonable opportunity to review this
Agreement with legal counsel prior to executing this Agreement.
SECTION 8.6 CHOICE OF LAW.
This Agreement and the performance hereof will be construed and
governed in accordance with the laws of the State of Delaware, without regard to
its choice of law principles.
SECTION 8.7 SUCCESSORS AND ASSIGNS.
(a) The obligations, duties and responsibilities of the Executive under
this Agreement are personal and shall not be assignable. In the event of the
Executive's death or disability, this Agreement shall be enforceable by the
Executive's estate, executors or legal representatives.
(b) In addition to any obligations imposed by law upon any successor to
the Company, the Company will require any successor (whether direct or indirect,
by purchase, merger, consolidation or otherwise) to all or substantially all of
the business or assets of the Company to expressly assume and agree to perform
this Agreement in accordance with its terms. Failure of the Company to obtain
such assumption and agreement prior to or upon the effectiveness of any such
succession shall constitute a material breach of this Agreement. If the Company
successfully obtains such assumption and agreement prior to or upon the
effectiveness of any such succession and the successor extends an offer of
employment to the Executive, any termination of the Executive's employment with
the Company incident to such succession shall be ignored for purposes of this
Agreement.
SECTION 8.8 WAIVER OF PROVISIONS.
Any waiver of any terms and conditions hereof must be in writing and
signed by the parties hereto. The waiver of any of the terms and conditions of
this Agreement shall not be construed as a waiver of any subsequent breach of
the same or any other terms and conditions hereof.
SECTION 8.9 SEVERABILITY.
The provisions of this Agreement shall be deemed severable, and if any
portion shall be held invalid, illegal or enforceable for any reason, the
remainder of this Agreement shall be effective and binding upon the parties
provided that the substance of the economic relationship created by this
Agreement remains materially unchanged.
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SECTION 8.10 REMEDIES.
The parties hereto acknowledge and agree that upon any breach by the
Executive of his obligations under Article V hereof, the Company will have no
adequate remedy at law, and accordingly will be entitled to seek specific
performance and other appropriate injunctive and equitable relief. No remedy set
forth in this Agreement or otherwise conferred upon or reserved to any party
shall be considered exclusive of any other remedy available to any party, but
the same shall be distinct, separate and cumulative and may be exercised from
time to time as often as occasion may arise or as may be deemed expedient.
SECTION 8.11 COUNTERPARTS.
This Agreement may be executed in multiple counterparts, each of which
will be deemed an original, and all of which together will constitute one and
the same instrument.
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IN WITNESS WHEREOF, the Company and the Executive have caused this
Agreement to be executed on the Effective Date.
EXECUTIVE:
/s/ Xxxxx X. Xxxxxx
--------------------------------------------------------------
Xxxxx X. Xxxxxx
COMPANY:
TRACTOR SUPPLY COMPANY
By:
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Its:
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