October 13, 1999
Xxxxxxx X. Xxxxxxx
0000 Xxxxxx Xxxx
Xxxxxxxxx, XX 00000
Re: Employee Severance Benefit Agreement
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Dear Xxx:
The Board of Directors of CBRL Group, Inc. recognizes the contribution
that you have made to CBRL Group, Inc. or one of its direct or indirect
subsidiaries (collectively, the "Company") and wishes to ensure your continuing
commitment to the Company and its business operations. Accordingly, in exchange
for your continuing commitment to the Company, and your energetic focus on
continually improving operations, the Company promises you the following
severance benefits if your employment with the Company is terminated in certain
circumstances:
1. DEFINITIONS. As used in this Agreement, the following terms have the
following meanings:
1.1 "Cause" means any one of the following:
(a) personal dishonesty;
(b) willful misconduct;
(c) breach of fiduciary duty; or
(d) conviction of any felony or crime involving moral
turpitude.
1.2 "Change in Control" means: (a) that after the date of this
Agreement, a person becomes the beneficial owner, directly or indirectly, of
securities of the Company representing 20% or more of the combined voting power
of the Company's then outstanding voting securities, unless that acquisition was
approved by a vote of at least 2/3 of the directors in office immediately prior
to the acquisition; (b) that during any period of 2 consecutive years following
the date of this Agreement, individuals who at the beginning of the period
constitute members of the Board of Directors of the Company cease for any reason
to constitute a majority of the Board unless the election, or the nomination for
election by the Company's shareholders, of each new director was approved by a
vote of at least 2/3 of the directors then still in office who were directors at
the beginning of the 2-year period; (c) a merger, consolidation or
reorganization of the Company (but this provision does not apply to a
recapitalization or similar financial restructuring which does not involve a
material change in ownership of equity of the Company and which does not result
in a change in membership of the Board of Directors); or (d) a sale of all or
substantially all of the Company's assets.
1.3 "Change in Control Period" means a 1-year year period beginning the
day after a Change in Control occurs.
2. TERMINATION OF EMPLOYMENT; SEVERANCE. Your immediate supervisor or the
Company's Board of Directors may terminate your employment, with or without
cause, at any time by giving you written notice of your termination, such
termination of employment to be effective on the date specified in the notice.
You also may terminate your employment with the Company at any time. The
effective date of termination (the "Effective Date") shall be the last day of
your employment with the Company, as specified in a notice by you, or if you are
terminated by the Company, the date that is specified by the Company in its
notice to you. The following subsections set forth your rights to severance in
the event of the termination of your employment in certain circumstances by
either the Company or you. Section 5 also sets forth certain restrictions on
your activities if your employment with the Company is terminated, whether by
the Company or you. That section shall survive any termination of this Agreement
or your employment with the Company.
2.1 Termination by the Company for Cause. If you are terminated for
Cause, the Company shall have no further obligation to you, and your
participation in all of the Company's benefit plans and programs shall cease as
of the Effective Date. In the event of a termination for Cause, you shall not be
entitled to receive severance benefits described in Section 3.
2.2 Termination by the Company Without Cause Other Than During a Change
in Control Period. If your employment with the Company is terminated by the
Company without Cause at a time other than during a Change in Control Period,
you shall be entitled to only those severance benefits provided by the Company's
severance policy or policies then in effect. You shall not be entitled to
receive benefits pursuant to Section 3 of this Agreement.
2.3 Termination by the Company Without Cause During a Change in Control
Period. If your employment with the Company is terminated by the Company without
Cause during a Change in Control Period, you shall be entitled to receive
Benefits pursuant to Section 3.
3. SEVERANCE BENEFITS. If your employment with the Company is terminated as
described in Section 2.3, you shall be entitled to the benefits specified in
subsections 3.1 and 3.2 for the period of time set forth in the applicable
section.
3.1 Salary Payment. You will be paid a lump sum equal to 18 months of
your base monthly salary, at the level in effect immediately preceding the
Effective Date. The determination of the amount of this payment shall be made by
the Company's payroll accountants and, absent manifest error, shall be final,
binding and conclusive upon you and the Company.
3.2 Continuation of COBRA Benefits. For a period of 18 months, you
shall continue to receive the medical, prescription and dental benefits at the
levels to which you were entitled on the day preceding the Effective Date,
pursuant to COBRA, and the Company will continue to pay premiums following the
Effective Date for those benefits in the same amount as it did prior to the
Effective Date. However, if you become reemployed with another employer and
receive healthcare benefits under another employer-provided plan, these COBRA
premium subsidy benefits shall cease.
4. EFFECT OF TERMINATION ON STOCK OPTIONS AND RESTRICTED STOCK. In the
event of any termination of your employment, all stock options and restricted
stock held by you that are vested prior to the Effective Date shall be owned or
exercisable in accordance with their terms; all stock options and restricted
stock held by you that are not vested prior to the Effective Date shall lapse
and be void; however, if your employment with the Company is terminated as
described in Sections 2.3 or 2.4, then, if your option or restricted stock
grants provide for immediate vesting in the event of a Change in Control, the
terms of your option or restricted stock agreement shall control. If your option
or restricted stock agreement does not provide for immediate vesting, you shall
receive, within 30 days after the Effective Date, a lump sum cash distribution
equal to: (a) the number of shares of the Company's ordinary shares that are
subject to options or restricted stock grants held by you that are not vested as
of the Effective Date multiplied by (b) the difference between: (i) the closing
price of a share of the Company's ordinary shares on the NASDAQ National Market
System as reported by The Wall Street Journal as of the day prior to the
Effective Date (or, if the market is closed on that date, on the last preceding
date on which the market was open for trading), and (ii) the applicable exercise
prices or stock grant value of those non-vested shares.
5. DISCLOSURE OF INFORMATION. You recognize and acknowledge that, as a
result of your employment by the Company, you have or will become familiar with
and acquire knowledge of confidential information and certain trade secrets that
are valuable, special, and unique assets of the Company. You agree that all that
confidential information and trade secrets are the property of the Company.
Therefore, you agree that, for and during your employment with the Company and
continuing following the termination of your employment for any reason, all
confidential information and trade secrets shall be considered to be proprietary
to the Company and kept as the private records of the Company and will not be
divulged to any firm, individual, or institution, or used to the detriment of
the Company. The parties agree that nothing in this Section 6 shall be construed
as prohibiting the Company from pursuing any remedies available to it for any
breach or threatened breach of this Section 6, including, without limitation,
the recovery of damages from you or any person or entity acting in concert with
you.
6. GENERAL PROVISIONS.
6.1 Other Plans. Nothing in this Agreement shall affect your rights
during your employment to receive increases in compensation, responsibilities or
duties or to participate in and receive benefits from any pension plan, benefit
plan or profit sharing plans except plans which specifically address benefits of
the type addressed in Sections 3 and 4 of this Agreement.
6.2 Death During Severance Period. If you die during the Severance
Period, any Benefits remaining to be paid to you shall be paid to the
beneficiary designated by you to receive those Benefits (or in the absence of
designation, to your surviving spouse or next of kin).
6.3 Notices. Any notices to be given under this Agreement may be
effected by personal delivery in writing or by mail, registered or certified,
postage prepaid with return receipt requested. Mailed notices shall be addressed
to the parties at the addresses appearing on the first page of this Agreement
(to the attention of the Secretary in the case of notices to the Company), but
each party may change the delivery address by written notice in accordance with
this Section 7.3. Notices delivered personally shall be deemed communicated as
of actual receipt; mailed notices shall be deemed communicated as of the second
day following deposit in the United States Mail.
6.4 Entire Agreement. This Agreement supersedes all previous oral or
written agreements, understandings or arrangements between the Company and you
regarding a termination of your employment with the Company or a change in your
status, scope or authority and the salary, benefits or other compensation that
you receive from the Company as a result of the termination of your employment
with the Company (the "Subject Matter"), all of which are wholly terminated and
canceled. This Agreement contains all of the covenants and agreements between
the parties with respect to the Subject Matter. Each party to this Agreement
acknowledges that no representations, inducements, promises, or agreements,
orally or otherwise, have been made with respect to the Subject Matter by any
party, or anyone acting on behalf of any party, which are not embodied in this
Agreement. Any subsequent agreement relating to the Subject Matter or any
modification of this Agreement will be effective only if it is in writing signed
by the party against whom enforcement of the modification is sought.
6.5 Partial Invalidity. If any provision in this Agreement is held by a
court of competent jurisdiction to be invalid, void, or unenforceable, the
remaining provisions shall nevertheless continue in full force without being
impaired or invalidated in any way.
6.6 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Tennessee, and it shall be enforced or
challenged only in the courts of the State of Tennessee.
6.7 Waiver of Jury Trial. The Company and you expressly waive any right
to a trial by jury in any action or proceeding to enforce or defend any rights
under this Agreement, and agree that any such action or proceeding shall be
tried before a court and not a jury. You irrevocably waive, to the fullest
extent permitted by law, any objection that you may have now or hereafter to the
specified venue of any such action or proceeding and any claim that any such
action or proceeding has been brought in an inconvenient forum.
6.8 Miscellaneous. Failure or delay of either party to insist upon
compliance with any provision of this Agreement will not operate as and is not
to be construed to be a waiver or amendment of the provision or the right of the
aggrieved party to insist upon compliance with the provision or to take remedial
steps to recover damages or other relief for noncompliance. Any express waiver
of any provision of this Agreement will not operate, and is not to be construed,
as a waiver of any subsequent breach, irrespective of whether occurring under
similar or dissimilar circumstances. You may not assign any of your rights under
this Agreement. The rights and obligations of the Company under this Agreement
shall benefit and bind the successors and assigns of the Company. The Company
agrees that if it assigns this Agreement to any successor company, it will
ensure that its terms are continued.
If all of the terms and conditions in this Agreement are agreed to by
you, please signify your agreement by executing the enclosed duplicate of this
letter and returning it to us. At the date of your return, this letter shall
constitute a fully enforceable agreement between us.
CBRL GROUP, INC.
By: /s/Xxx X. Xxxxx
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Xxx X. Xxxxx
Chairman and Chief Executive Officer
The foregoing is fully agreed to and accepted by:
Company Employee's Signature: /s/Xxxxxxx X. Xxxxxxx
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Please Print or Type Name: Xxxxxxx X. Xxxxxxx
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Please Print or Type Title: Assistant Treasurer
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